Manulife Expects $250 Million Loss for Third Quarter
October 19, 2008
Manulife, Canada’s largest insurer and the parent company of John Hancock Financial Services in the U.S., expects to take a $250 million charge on credit losses in the third quarter.
The firm, which is also North America’s largest insurer by market value, announced that the decline in equity markets since the end of September has hurt its capital ratios. But the company expects its regulatory capital ratio to be within its targeted operating range of 180% to 200% for the third quarter.
Manulife last month revealed its exposure to troubled American International Group and the bankrupt Lehman Brothers Holdings Inc. The $250 million loss includes an increase of about $50 million in reserves after downgrades of investments owned by the company.
The company said it had a reserve fund of $1.4 billion to protect against any shortfall in its variable annuity and segregated funds business. Manulife also said that the quality of its assets remained high.
“Manulife remains conservatively reserved, has a high-quality balance sheet and strong and leading business franchises around the world,” said Dominic D’Alessandro, the company’s CEO.
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