By Nichola Saminather
TORONTO (Reuters) – Canada’s two largest life insurers, Manulife Financial and Sun Life Financial, on Wednesday reported third quarter earnings growth, driven by new business growth and increased assets under management.
Sun Life exceeded analysts’ expectations, helped by a 23% increase in profits from its asset management business that offset losses in the United States and Asia from COVID-related claims, but Manulife has missed estimates due to weather charges.
As the pandemic and related claims, much of it outside of Canada, weighed on parts of insurers’ businesses, growth in wealth, supported by foreclosure-induced savings and stimulus measures in the government, has proven to be a boon to their wealth management units.
Base profits for Manulife, Canada’s largest life insurer, reached C $ 1.5 billion ($ 1.2 billion), or 76 cents Cdn per share, in the quarter ended September 30, versus C $ 1.45 billion, or 73 cents, a year earlier. Analysts were expecting 79 cents Canadian.
The company has taken a charge of C $ 152 million in its property and casualty reinsurance business due to estimated losses from Hurricane Ida on the US Gulf Coast and flooding in Europe, above about 135 million. Canadian dollars expected by Canaccord Genuity analysts.
Manulife reported an increase in assets under management which boosted its global wealth and asset management business and helped offset declining earnings in Asia and the United States.
The smaller Sun Life’s underlying earnings were C $ 902 million, or C $ 1.54 per share, in the quarter ended September 30, compared to C $ 842 million, or C $ 1.44 , one year earlier. Analysts were expecting C $ 1.52 in Canadian cents.
Profits fell 19% in the United States and 12% in Asia, in part due to COVID-19-related claims in the United States, Indonesia and the Philippines, as well as the negative impacts of currency movements. However, this was offset by a 23% increase in profits for its asset management unit.
($ 1 = 1.2390 Canadian dollars)
(Reporting by Nichola Saminather; Editing by Richard Pullin)