NU Online News Service, Oct. 29, 2003, 5:29 p.m. EST – Sun Life Financial Inc., Toronto, says it increased net income 9.1% in the third quarter despite the effects of the weak dollar and low interest rates on the results at its U.S. division.
The company as a whole is reporting the equivalent of $291 million in net income for the latest quarter on $3.9 billion in revenue, compared with $229 million in net income on $3.7 billion in revenue for the third quarter of 2002.
At home, Sun Life is reporting 394 million Canadian dollars in net income on 5.3 billion Canadian dollars in revenue, compared with 361 million Canadian dollars in net income on 5.8 billion Canadian dollars in revenue for the comparable quarter in 2002.
The conversions here use an exchange rate of $1=1.3536 Canadian dollars for the 2003 results, and an exchange rate of $1=1.5785 Canadian dollars for the 2002 results. The exchange rates come from OANDA Corp., New York.
The shift in exchange rates means that a U.S. dollar that Sun Life’s U.S. division sends the parent company today is worth about 14% less than a U.S. dollar sent to Canada a year ago.
The U.S. division is reporting 97 million Canadian dollars in net income on 2.2 billion in revenue, down from 101 million Canadian dollars in net income on 2.6 billion in revenue for the third quarter of 2002.
Interest rates are starting to rebound, but lingering low rates are continuing to compress the spread between the yield that Sun Life gets on its own investments and the rates that it has promised to holders of fixed annuities, the company says.