Manulife posts $947M loss as accounting charges offset operational improvements
Canada’s largest life insurance provider, Manulife Financial Corp., posted a $947-million loss in the third quarter as the company recorded a number of charges that more than offset improvements in operational earnings.
One of the big negatives was a $1.04 billion charge to goodwill that reflects the impaired value of Manulife’s U.S. insurance business, due to the weak economic outlook and a repositioning of that business.
Manulife also reported $2.03 billion in charges resulting from an annual review of all actuarial methods and assumptions, which the company uses to estimate its future liabilities.
The company said a significant portion of the change in assumptions related to its John Hancock long-term car business following a comprehensive analysis of claims and an assessment of the impact of rate increases.
Those negative charges more than offset $1.04 billion in gains from investment activities, including a $569-million gain from the sale of bonds.
The third-quarter loss amounted to 55 cents per common share, compared with 12 cents per share a year earlier but an improvement from a loss of $1.36 per share in the second quarter of 2010.
Manulife’s total revenue declined to $13.1 billion from $13.7 billion.
Premium income fell to $4.65 billion from $5.52 billion, investment income rose to $3.08 billion from $2.08 billion, gains on assets were $3.87 billion down from $4.66 billion and other revenue was $1.54 billion, up from $1.49 billion.
