Weak sales, writedown knock Manulife to loss

Thu Feb 9, 2012 11:13am EST
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By Cameron French

(Reuters) - Weaker insurance sales and a big writedown at it U.S. operation dropped Manulife Financial (MFC.TO: Quote) to a quarterly loss, Canada's biggest life insurer said on Thursday.

The company, the first Canadian life insurer to report year-end results, also said that its chief financial officer, Michael Bell, would step down once a replacement can be found.

Manulife lost C$69 million ($69 million), or 5 Canadian cents a share in the fourth quarter, ended December 31, compared with a year-earlier profit of C$1.8 billion, or C$1.00 a share.

Analysts, on average, had expected a loss of 11 Canadian cents a share, according to Thomson Reuters I/B/E/S.

Peter Routledge, an analyst at National Bank Financial, called it an "in line" result, but said core insurance earnings were actually a bit on the low side.

"They had some investment-related gains related to non fixed income investments and oil and gas properties, so that bolstered earnings," he said.

The company took a C$665 million noncash writedown on its U.S.-based John Hancock insurance unit to reflect the current and expected low interest rate environment.

CFO LEAVING   Continued...