Manulife Financial Corporation (MFC) has reported net income attributed to shareholders of USD1,117 million for the third quarter of 2016, fully diluted earnings per common share of USD0.55 and return on common shareholders' equity (ROE) of 11.1 per cent.
This compares with USD622 million, USD0.30, and 6.5 per cent, respectively, for the third quarter of 2015.
The increase in net income attributed to shareholders was primarily due to investment-related experience gains recorded in Q3 2016, compared with investment-related experience charges in Q3 2015.
For Q3 2016, MFC generated core earnings of USD996 million, diluted core earnings per common share of USD0.49 and core return on common shareholders' equity of 9.8 per cent, compared with USD870 million, USD0.43, and 9.2 per cent, respectively, for Q3 2015.
Year-to-date 2016 net income attributed to shareholders was USD2,866 million, fully diluted earnings per common share was USD1.40 and ROE was 9.7 per cent compared with USD1,945 million, USD0.94 and 7.1 per cent, respectively, for the same period in 2015.
Year-to-date 2016 core earnings was USD2,734 million, diluted core earnings per common share was USD1.34 and core ROE was 9.2 per cent compared with USD2,569 million, USD1.27 and 9.5 per cent, respectively, for the same period in 2015.
Donald Guloien (pictured), president and chief executive officer, says: "We delivered strong core earnings this quarter thanks to improved results across our operations which, combined with favourable markets and excellent returns from our investment portfolio, led to an increase in net income to above USD1 billion."
"While we are pleased with these results, we continue to operate in a difficult macroeconomic environment and we remain focused on optimising the performance of all of our businesses and on growing aggressively those which deliver the highest returns.
"This quarter, we once again delivered strong growth in Asia and generated positive net flows in our wealth and asset management businesses around the world."
Steve Roder, chief financial officer, says: "We achieved USD297 million of broad-based investment gains, reflecting our high quality portfolio and disciplined approach to extending credit. With the strong investment results this quarter, we now have a cumulative gain for the year so far.
"We completed our annual review of actuarial methods and assumptions in the third quarter, resulting in a net reserve strengthening of USD455 million. This amount included updates to policyholder assumptions across a number of products, including long-term care in the US, as well as a charge of USD313 million related to a proactive 10 basis point downward revision to our ultimate reinvestment rate assumptions.”
