AHN Staff
Toronto, Ontario (AHN) - Two major Canadian insurers reported on Thursday losses for the third quarter of 2009. Manulife Financial Corporation reported a Q3 loss of $172 million, while Sun Life Financial Incorporated logged a Q3 loss of $140 million.
For the same quarter last year, Manulife had a net income of $510 million, while Sun Life suffered a bigger net loss of $396 million. Manulife's Q3 performance translates into a 12 cents loss per share, while for Sun Life the loss was 25 cents per share.
According to Manulife, its third quarter results was a reflection of equity market increases offset by lower corporate bond rates and changes in actuarial assumptions.
Manulife Chief Executive Officer Donald Guloien explained in a statement, "Underlying earnings and performance were solid this quarter, but our results were negatively impacted by lower corporate bond rates and strengthening of reserves for changes in actuarial assumptions. We took actions to improve margins, increased our sales of products other than variable annuities, further improved our equity risk profile and continued to build toward fortress capital levels."
Sun Life attributed its Q3 loss to implementation of some equity and interest rate-related actuarial assumption updates the firm announced on Aug. 6, 2009. Although better equity markets gave the company some earnings, Q3 results were adversely affected by reserve increases for downgrades on Sun Life's investment portfolio.
Sun Life Chief Executive Officer Donald Stewart said the company's Canadian business reflects a strong brand and distribution, while its U.S. business benefits from enhanced distribution and strong annuity sales. Stewart pointed out, "There is underlying strength in our business but we continue to face challenging economic headwinds."
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