NU Online News Service, Oct. 25, 12:19 p.m. – Nationwide Financial Services Inc., Columbus, Ohio, is reporting $133 million in net income for the third quarter on $790 million in revenue, compared with $117 million in net income on $804 million in revenue for the third quarter of 2000.
Operating income, which includes $26 million in gains on investments sold or re-valued during the quarter, fell to $106 million, from $119 million.
Nationwide cut expenses sharply during the quarter.
Operating income for traditional individual life insurance held steady at $18 million, and operating income for individual investment life insurance products increased 18%, to $26 million, Nationwide says.
But confusion surrounding estate tax planning issues hurt sales of life products aimed at the estate planning market, and the soft economy hurt sales of life products aimed at the corporate market, Nationwide says.
“The weak economic climate has had a sharp impact on sales of corporate-owned life insurance, as fewer businesses are creating new employee benefit programs,” Nationwide says.
At the institutional products unit, sales of fixed investment options helped make up for some of the drop in group annuity balances.
But “the impact of higher asset levels was offset by declining yields, which drove interest spread to 179 basis points for the quarter, a decline from 197 basis points reported a year ago and 185 basis points in the second quarter,” Nationwide says.