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Manulife Reports 1Q Net Income Of $818 Million

PR Newswire Association LLC


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Substantive progress made on growth strategies in the first quarter of 2014:

  • Developing our Asian opportunity to the fullest - Improved momentum in insurance sales1 with a significant increase in Japan and double digit growth in most other territories supported by new product launches and marketing efforts; and wealth sales continued to be at the levels seen in the second half of last year, down from the first half of last year, as rising interest rates and market uncertainty continued to impact some markets.
  • Growing our wealth and asset management businesses around the world - Our 22nd consecutive quarter of record funds under management1; Manulife Asset Management reported strong results including: record institutional advisory assets under management; new mandates in Asia and North America; and with the majority of public asset classes outperforming their benchmarks on a 1, 3, and 5-year basis.
  • Building on our balanced Canadian business - Continued momentum in mutual fund sales and strong group pension sales drove record wealth sales; retail insurance sales increased due to our actions to improve our competitive positioning; and Manulife Bank lending volumes declined reflecting slowing consumer credit and aggressive rate competition.
  • Continuing to drive sustainable earnings and opportunistic growth in the U.S. - Record mutual fund sales and funds under management; 10th consecutive quarter of positive net mutual fund sales; Retirement Plan Services sales declined reflecting competitive pressures, but reported meaningful sales in the new mid-market product; and insurance sales slowed reflecting prior year pricing actions, however recently introduced product enhancements and more competitive prices are expected to improve sales momentum2.

TORONTO, May 1, 2014 /PRNewswire/ - Manulife Financial Corporation ("MFC") announced today net income attributed to shareholders of $818 million for the quarter ended March 31, 2014 ("1Q14"), fully diluted earnings per common share of $0.42 and return on common shareholders' equity ("ROE") of 11.9%. In 1Q14, MFC generated core earnings1 of $719 million, fully diluted core earnings per common share1 of $0.37 and core return on common shareholders' equity ("Core ROE")1 of 10.4 %.

Donald Guloien, President and Chief Executive Officer, said, "We are pleased with our solid start to 2014, which demonstrates measurable progress against our longer-term objectives.  We delivered strong core earnings, most notably in Asia, net income, wealth sales, and a very healthy capital ratio, as well as another quarter of record funds under management."

Mr. Guloien added, "We have increased our momentum in life insurance sales in Asia and Canada. While insurance sales in the U.S. were below expectations in the first quarter, we recently introduced product enhancements and more competitive pricing which we expect to improve sales."

Steve Roder, Chief Financial Officer said, "We continue to make steady progress on growing our core earnings. New business embedded value improved relative to the first quarter last year, reaffirming that the profitability of our new business continues to improve."

"We also generated strong investment-related experience reflecting our high quality portfolio and disciplined approach to extending credit and other investment activities," added Mr. Roder.

1 This item is a non-GAAP measure.  See "Performance and Non-GAAP Measures" below.
2 See "Caution regarding forward-looking statements" below.


Highlights for the First Quarter of 2014:

  • Reported net income attributed to shareholders of $818 million for 1Q14. This compares with net income of $540 million for the quarter ended March 31, 2013 ("1Q13"). Our 1Q14 net income benefited by $275 million from strong investment-related experience which was partly offset by the negative impact of market-related factors totalling $90 million.
  • Generated core earnings of $719 million in 1Q14, an improvement of



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