Manulife takes hit from continued Covid restrictions in Asia

MANULIFE Financial took a hit from continued pandemic-related restrictions that weighed on its Asia business, extending a patch of rocky results for the insurer in the region.

Third-quarter core earnings in the Asia unit fell 3.8 per cent from a year earlier to C$513 million (S$532 million), the Toronto-based company said on Wednesday (Nov 9) in a statement.

Manulife has faced a difficult macroeconomic environment in recent quarters, with measures intended to fight Covid-19 hurting its Asia business and plunging equity markets weighing on the wealth- and asset-management unit. Annualised premium equivalent sales in Asia fell 8.2 per cent to C$854 million, hurt by lower sales in Hong Kong, which only recently began lifting Covid-related restrictions. By contrast, core earnings in Canada rose 13 per cent to C$350 million.

“Many of our markets in Asia are experiencing significant Covid case counts and significant restrictions,” chief executive officer Roy Gori said in an interview. “The strength that we have is that we can see some of those headwinds and offset them with strengths in other markets, in this case in Canada.”

Net income fell 15 per cent to C$1.35 billion, or 68 US cents a share. Excluding some items, profit was 67 US cents a share, missing the 68-cent average estimate of 11 analysts in a Bloomberg survey.

Manulife shares have fallen 7.8 per cent this year, compared with a 12 per cent drop for the S&P/TSX Composite Financials index.

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Manulife’s global wealth and asset-management business largely withstood an industrywide decline that’s being driven by falling equity markets. Core earnings in the unit fell 1.7 per cent to C$345 million in the quarter, while it generated C$3 billion of net inflows. BLOOMBERG