Manulife announces deal to reinsure $5.8-billion block of its business, freeing up capital for a share buyback

  • 📰 globebusiness
  • ⏱ Reading Time:
  • 53 sec. here
  • 2 min. at publisher
  • 📊 Quality Score:
  • News: 25%
  • Publisher: 66%

United States News News

United States United States Latest News,United States United States Headlines

The transaction will also allow the insurer to sell $600-million of alternative long-duration assets that were backing life insurance contracts

Manulife Insurance Toronto headquarters seen in Toronto in September, 2017. Manulife stock climbed 32 cents to close at $32.98 on the TSX.Manulife Financial Corp. has signed a deal to reinsure more than $5.8-billion of risk on its books, freeing up about $800-million in capital that will be used for future share buybacks.announced on Monday that RGA Life Reinsurance Company of Canada will reinsure $5.

Reinsurers are insurers to the insurance industry, and they help spread the cost of risk in certain areas of the business. Over the past several years, Manulife has been concluding reinsurance deals to cut down on the amount of risk it holds in its insurance portfolio.more than $13-billion of risk, including $6-billion in its long-term care insurance business.

RGA is a subsidiary of Reinsurance Group of America Inc., a Missouri-based global reinsurance company founded in 1973 that specializes in life and health insurance. This is the third reinsurance deal Manulife has concluded with RGA. In 2012, Manulife completed a U.S. deal with RGA and did a second transaction about four years ago, according to Marc Costantini, Manulife’s global head of inforce management.

While the transaction will also see an annual reduction to core earnings of about $50-million and net income to shareholders of about $40-million, Mr. Costantini says it will be “accretive” to core earnings per share as Manulife completes the share buybacks.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 31. in US

United States United States Latest News, United States United States Headlines