TORONTO (Reuters) - Sun Life Financial (SLF.TO), Canada’s No. 3 life insurer, said on Tuesday its first-quarter net income fell 22 percent due to the impact of last year’s sale of its U.S. annuities business as well as financial markets losses.
Sun life reported net earnings of C$400 million ($367.23 million), or 65 Canadian cents a share, in the quarter, down from C$513 million, or 85 Canadian cents a share, a year earlier.
On a continuing operations basis, which excludes the impact of the U.S. annuities business, operating income was C$454 million, or 74 Canadian cents a share, up from C$448 million, or 75 Canadian cents per share.
That result topped the profit of 67 Canadian cents a share expected by analysts, according to Thomson Reuters’ I/B/E/S.
Toronto-based Sun Life sold the annuities business as part of a push to reduce its exposure to uncertain stock markets and interest rates.
In addition to the direct impact of the sale -- the business earned C$103 million in the year-before quarter -- fixed-income rate movements stripped C$64 million from the bottom line.
Sun Life, which also owns U.S. investment manager MFS and has a growing presence in Asia, has spent the last several quarters working to reduce its market exposure through hedging and re-aligning its business.
Assets under management rose by 17.6 percent to C$671.1 billion, while premiums and deposits totaled C$32.7 billion in the quarter, up 7.3 percent from the year-before period.
Last week, rival Manulife Financial Corp (MFC.TO) posted a 50 percent rise in first-quarter profit as a stronger investment performance and higher wealth management fees more than offset weaker insurance sales.
Reporting by Cameron French; Editing by David Gregorio and Leslie Adler