(Bloomberg) — Manulife Financial Corp., Canada’s largest life insurer, said profit rose 6.4 percent in the third quarter as wealth and insurance sales jumped in Asia, countering declines in Canada and the U.S.
Net income climbed to C$1.1 billion ($972 million), or 57 cents a share, from C$1.03 billion, or 54 cents, a year earlier, the Toronto-based company said in a statement today. Profit excluding some items was 39 cents a share, missing the 40-cent average estimate of 15 analysts surveyed by Bloomberg.
“Our results were highlighted by very strong sales from Asia, partially offset by some weaker results in Canada and the U.S.,” Chief Executive Officer Donald Guloien, 57, said in the statement. “Owing to widespread global economic uncertainty prevalent in the third quarter, wealth sales were slower.”
Manulife benefited from increased marketing of insurance and wealth products from Japan to Indonesia, where an expanding middle class is fueling demand. The company operates in 11 Asian markets and relies on the region for about a third of its profit.
Sales of insurance products in the unit hit a record, jumping 46 percent to $352 million. Its biggest boost was from Japan corporate products and new offerings in Hong Kong.
Wealth sales also gained in the region, rallying 74 percent to $2.2 billion as the firm began selling a floating rate loan fund in Japan and ran a marketing campaign for pension and mutual funds in Hong Kong.
Manulife is among insurers that have increasingly relied on asset management to fuel growth. Last quarter, as fees from U.S. and Asian wealth units rose, the firm raised its dividend — the first major Canadian life insurer to do so. This quarter, Manulife’s North America results lagged amid pressure from competitors and fluctuating equity markets.
In Canada, loans in its banking unit slid 27 percent to C$927 million due to “intense rate competition driven by the slowdown in the residential mortgage market.” Wealth product sales declined 15 percent over the year-ago period. Insurance sales dipped 23 percent to $143 million on a decline in group benefits product sales.
In the U.S., where Manulife operates John Hancock Investments, wealth management sales declined 6 percent and insurance revenue slipped 19 percent from last year. Long-term care insurance sales fell to $12 million, from $15 million.
Manulife rose 3.4 percent this year to close at C$21.65 yesterday in Toronto. It’s the second-best performer on the Standard & Poor’s/TSX Life & Health Insurance Index.