Earnings Release Q2 2023

Genworth Financial Announces Second Quarter 2023 Results

Net Income of $137 Million and Adjusted Operating Income of $85 Million Announced $350 Million Expansion of Existing Share Repurchase Program

• Enact segment adjusted operating income of $146M; PMIERs1 sufficiency ratio of 162%2
• Continued progress on Long-Term Care Insurance (LTC) multi-year rate action plan, with $94M of gross incremental premium approved in second quarter and approximately $24.4B net present value achieved from in-force rate actions (IFAs) since 2012
• LTC adjusted operating loss of $(43)M; Life and Annuities adjusted operating income of $2M
• U.S. life insurance companies' statutory pre-tax income3 of $63M2 driving RBC4 ratio of 293%2
• Genworth holding company cash and liquid assets of $222M at quarter-end
• Executed $112M in share repurchases in the quarter; $264M in total executed through July 2023 at an average price of $5.11 per share

Richmond, VA (August 8, 2023) - Genworth Financial, Inc. (NYSE: GNW) today reported results for the quarter ended June 30, 2023.

"Enact continues to perform well and has increased its planned capital retuto Genworth and other shareholders. Based on strong free cash flow, the Genworth Board increased the share repurchase authorization by $350 million." - Tom McInerney, President & CEO

Consolidated Metrics		Q2 2023		Q1 2023		Q2 2022
(Amounts in millions, except per share data)
Net income5	$	137	$	122	$	159
Earnings per diluted share5	$	0.29	$	0.24	$	0.31
Adjusted operating income5,6	$	85	$	144	$	153
Adjusted operating income per diluted share5,6	$	0.18	$	0.29	$	0.30
Weighted-average diluted shares		478.1		500.1		514.1

1. Private Mortgage Insurer Eligibility Requirements.
2. Company estimate for the second quarter of 2023 due to timing of the preparation of the filing(s).
3. Net gain from operations before dividends to policyholders, refunds to members and federal income taxes for Genworth Life Insurance

Company (GLIC), Genworth Life and Annuity Insurance Company (GLAIC) and Genworth Life Insurance Company of New York (GLICNY), and before realized capital gains or (losses).

1. Risk-basedcapital ratio based on company action level for GLIC consolidated.
2. All references reflect amounts available to Genworth's common stockholders excluding noncontrolling interests.
3. This is a financial measure that is not calculated based on U.S. Generally Accepted Accounting Principles (GAAP). See the Use of Non-GAAP Measures section of this press release for additional information.

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Consolidated GAAP Financial Highlights

• Net income was driven by Enact, which had strong operating performance resulting from favorable loss performance and increased net investment income
• Net investment gains, net of taxes and other adjustments, increased net income by $33 million in the current quarter, compared with $15 million in the prior year. The investment gains in the current quarter were primarily from mark-to-market adjustments on limited partnership and equity investments held in the LTC business, partially offset by net trading losses
• Changes in fair value of market risk benefits and associated hedges, net of taxes and other adjustments, increased net income by $18 million in the current quarter compared with a decrease of $6 million in the prior year
• Adjusted operating income reflects Enact's strong operating performance, partially offset by losses in LTC and Corporate and Other
• Net investment income was $785 million in the quarter, a slight decrease from $787 million in the prior year due to lower income from limited partnerships and U.S. Government Treasury Inflation-Protected Securities (TIPS), mostly offset by higher investment yields
• The effective tax rate on income from continuing operations was approximately 24.9 percent in the current quarter, primarily reflecting a higher tax rate of 35 percent on certain forward starting swap gains, consistent with prior quarters
  In the second quarter of 2023, the company changed its accounting for the liability for future policy benefits under long-duration targeted improvements accounting guidance (LDTI) to include an estimate in assumptions for cash payments to policyholders associated with previously disclosed LTC legal settlements. This is consistent with the treatment of the estimate for benefit reductions associated with these settlements as part of the liability for future policy benefits. The change impacted the balance sheet and income statement results for prior periods after the adoption of LDTI on January 1, 2023. All prior period amounts reflected herein have been updated to reflect this change. LTC's GAAP results were impacted as a result, but there was no impact to Enact, the company's cash flows, capital levels, or statutory accounting results.

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Enact

favorable pre-tax reserve release of $63 million, primarily from cure performance on 2020 through first half 2022 delinquencies, including COVID-19 related delinquencies. The prior quarter and prior year included favorable pre-tax reserves releases of $70 million and $96 million, respectively, primarily related to cures on COVID-19 delinquencies

• Net investment income was $50 million pre-tax in the current quarter, up from $36 million pre-tax in the prior year from rising interest rates and higher average invested assets

• Primary insurance in-force increased nine percent versus the prior year to $258 billion, driven by new insurance written (NIW) and continued elevated persistency

• Primary NIW was down 14 percent versus the prior year, primarily from lower originations as a result of elevated interest rates, and increased 15 percent sequentially primarily driven by higher originations

• New delinquencies increased 17 percent to 9,205 from 7,847 in the prior year, primarily from the aging of large, new books

• Enact announced on August 1, 2023 that its Board of Directors has authorized a new share repurchase program of $100 million shares. Enact increased its full year 2023 capital retuguidance and now expects to retua total of $300 million of capital to its shareholders

• Enact paid a quarterly dividend of $0.16 per share in the current quarter

• Estimated PMIERs sufficiency ratio was 162 percent, $1,958 million above requirements, down two points from the prior quarter as a result of NIW, partially offset by lapse

1. Reflects Genworth's ownership excluding noncontrolling interests of $31 million, $32 million and $38 million in the second and first quarters of 2023 and second quarter of 2022, respectively.
2. The PMIERs sufficiency ratio is calculated as available assets divided by required assets as defined within PMIERs.

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Long-Term Care Insurance

• Premiums related to IFAs of $245 million pre-tax, up $19 million versus the prior year
• Lower net investment income of $16 million pre-tax versus the prior year, primarily from limited partnerships and TIPS, partially offset by higher bank loan income and investment yields
• Current quarter results reflected a liability remeasurement loss of $61 million pre-tax. The unfavorable actual experience versus best estimate liability assumptions of $85 million was driven by lower terminations and higher claims as the blocks age, primarily on unprofitable, capped LTC cohorts. This was partially offset by a favorable quarterly assumption update of $24 million related to the implementation timing and approval amounts of certain IFAs

Life and Annuities

Life Insurance

• Current quarter results reflected lower mortality experience
• Deferred acquisition costs amortization expense was lower, primarily driven by lower lapses and block runoff

Annuities

• Fixed annuities results reflected lower fixed payout annuity mortality and lower net spreads, primarily related to block runoff
• Variable annuities reported higher adjusted operating income versus the prior year from favorable impacts of the aging of the block

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U.S. Life Insurance Companies Statutory Results and RBC

• Statutory pre-tax income estimated at $63 million for the current quarter, driven by:

1. LTC, which continues to benefit from premium increases and benefit reductions from IFAs, including more favorable impacts from reduced benefit selections on policies subject to legal settlements versus the prior year, but experienced pressure from seasonally lower terminations, higher claims as the blocks age, and legal settlement expenses

1. Improved mortality in life insurance

• 1. Favorable impacts to variable annuity reserves from equity market and interest rate movements
• The U.S life insurance companies estimate quarter-end RBC to be 293 percent, down slightly from the prior quarter

Corporate and Other

• The current quarter adjusted operating loss of $20 million was higher versus the prior quarter and prior year's adjusted operating losses of $18 million and $16 million, respectively. Expenses related to the company's new growth initiatives with its CareScout business increased versus the prior year

Holding Company Cash and Liquid Assets

• Cash and liquid assets of $222 million remained above the company's cash target of two-times annual debt service
• Cash inflows during the quarter consisted of $63 million from intercompany tax payments and $54 million from Enact capital returns, which included a $21 million quarterly dividend and $33 million in share repurchase proceeds

1. Genworth's principal U.S. life insurance companies: GLIC, GLAIC and GLICNY.
2. Holding company cash and liquid assets comprises assets held in Genworth Holdings, Inc. (the issuer of outstanding public debt) which is a wholly-owned subsidiary of Genworth Financial, Inc.
3. Genworth Holdings, Inc. had $222 million, $233 million and $178 million of cash and cash equivalents as of June 30, 2023, March 31, 2023 and June 30, 2022, respectively. Genworth Holdings, Inc. also held $50 million in U.S. government securities as of June 30, 2022.

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