Manulife Philippines sales, premiums up in first semester

Despite increased domestic political concerns and the widely reported financial difficulties of some major players in the pre-need market, Manulife Financial Philippines has posted positive growth in the first half of 2005.

Overall sales increased by two percent with life sales increasing by 10 percent in the first half of 2005, compared to the same period in 2004. Total assets under management (AUM) increased by 18 percent, driven by strong positive cash flows and good investment returns.

"Manulife Philippines continues to respond to its clients’ evolving needs," Renato Vergel de Dios, president and chief executive officer of Manulife Philippines said in a statement.

Vergel de Dios further revealed that the Philippine operations will introduce two new products in the third quarter of the year, as well as initiate talks with banks for the sale of its products.

As of December 2004, Manulife’s trust fund assets of P 2.4 billion exceeded actuarial reserve liabilities (ARL) by P257 million. These assets, drawn for its pre-need operations, are primarily invested in highly marketable medium to long term government securities with small holdings of blue chip stocks listed in the Philippine Stock Exchange (PSE).

Meanwhile, mother unit Manulife Financial Corp. reported shareholders’ net income of $839 million for the second quarter of 2005, an increase of 28 percent over a year earlier. Earnings per common share increased by 13 percent to $1.05 from $0.93 reported in the second quarter of 2004.

In addition, its return on common shareholders’ equity increased from 14.1 percent in the first quarter of 2005 to 14.3 percent this quarter.

"This quarter marked the one year anniversary of the John Hancock transaction," said Dominic D’Alessandro, president and chief executive officer of Manulife Financial. "We are very pleased with the enhanced scale, strong product portfolio and diversified distribution that the organization has realized through this acquisition. The anticipated synergies are evident in the impressive sales results, particularly those recorded in US, individual insurance and annuities segments, and our record level of shareholders’ earnings.

Total premiums and deposits for the second quarter of $14.3 billion were $1.4 billion higher than reported in the second quarter of 2004. The increase from the prior year period reflects an additional month of John Hancock contribution, strong variable annuity sales in Japan and the US, and strong sales in Canadian Group Pensions. These results were partially offset by the decline of the US dollar versus the Canadian dollar over the past year.

Funds under management were $364 billion end June, or an increase of $14 billion over the previous quarter. Compared to the same period last year, funds under management were up $4 billion, primarily driven by gains in US Wealth Management and Canada.

Year-to-date shareholders’ net income was $1.6 billion, up 52 percent from the $1 billion reported in 2004.

Total capital was $28.8 billion in the first semester down slightly from $29.2 billion last year. Net income in the past 12 months and the addition of $350 million of preferred shares issued on Feb. 10, 2005 were more than offset by shareholder dividends, the repurchase of shares and the negative impact of a strengthening Canadian dollar.

Manulife declared a quarterly shareholders’ dividend of $0.30 per share on the common shares, payable on and after Sept. 19, 2005 to shareholders of record at the close of business on Aug. 16, 2005. A dividend of $0.25625 per share was also declared on the non-cumulative Class A shares Series 1, payable on and after Sept. 19, 2005 to shareholders of record at the close of business on Aug. 16, 2005.