Genworth Executive Says China Oceanwide Deal Is Still on Track

Genworth ended up using an alternative financing strategy to make the debt payments, and it has given up on the idea of separating the LTCI operations from the other life and annuity operations, because of resistance from regulators in Delaware.

Deal Update

Now, China Oceanwide and Genworth are working on new capital investment plan, McInerney said.

The current version of the plan would have China Oceanwide contribute about $1.5 billion to Genworth over time after the deal closes, McInerney said.

“We expect to finalize the details of this plan with Oceanwide in the near future,” McInerney said.

Genworth has received approvals for the deal from some agencies in the United States but still needs approvals from regulators in New York state.

China Oceanwide needs approvals from three agencies in China.

Genworth does not believe it has any significant regulatory review issues with U.S. regulators, and China Oceanwide has not talked about having any problems with regulators in China, McInerney said.

Operating Performance

Kelly Groh, Genworth’s chief financial officer, noted that getting approvals from state insurance regulators for LTCI premium increases is important, because Genworth expects the U.S. life companies that hold the life, annuity and LTCI blocks to support themselves.

“We intend to manage the U.S. life entities on a stand-alone basis,” Groh said. “We have no current plans to infuse capital in these businesses, nor do we expect to extract capital.”

Given the poor performance of the LTCI blocks, Genworth believes the company will get little or not value from the life insurance unit and its subsidiaries, Groh said.

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