February 14, 2008 / 6:42 PM / in 10 years

Great-West raises dividend as profit increases

TORONTO (Reuters) - Quarterly profit rose 9 percent at Great-West Lifeco Inc (GWO.TO) with higher earnings in Canada and the United States being weighed down by flat profit in Europe, the insurance holding company said on Thursday.

The company also said it increased its quarterly dividend by 6 percent to 29.25 cents per share.

Great-West, Canada’s second-biggest life insurer, said net income was $537 million ($538 million), or 60 Canadian cents a share, in the three months ended December 31. That compared with profit of $491 million, or 55 cents, a year earlier.

Great-West said the strong Canadian dollar reduced reported net income by $38 million, or about 4 cents a share.

Analysts had expected the company, which last year bought U.S. money manager Putnam Investments Trust, to earn 63 cents a share in the quarter, according to Reuters Estimates.

Putnam’s asset management business has been included in Great-West’s financial results since August 3, 2007.

Great-West, which is based in Winnipeg, Manitoba, and controlled by Montreal’s Power Financial Corp (PWF.TO), said overall group premiums and deposits surged 83 percent to $19.3 billion in the fourth quarter due to higher mutual fund deposits because of the Putnam acquisition.

However, Putnam saw outflows of US$12.5 billion in stock and bond funds in 2007, the most in the U.S. industry, according to Financial Research Corp.

Reporting by Lynne Olver; Editing by Peter Galloway

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