Reinsurance Group in C$5.8 Billion Coinsurance Deal With Canada's Manulife
By Robb M. Stewart
Reinsurance Group of America has struck a deal with Manulife Financial to reinsure roughly $4.4 billion of reserves, the third large block reinsurance transaction between the companies in what they say is the largest universal life reinsurance transaction in the Canadian market to date.
RGA's Canadian arm said it completed a coinsurance transaction with Manulife's Manufacturers Life Insurance unit to reinsure about 5.8 billion Canadian dollars of reserves, with an accompanied equivalent asset transfer.
The effective date of the transaction is April 1 and Manulife will continue to administer all policies as part of the arrangement.
The move comes after RGA last week said it reached an agreement with Japan Post Insurance for an affiliate of RGA to reinsure an about 700 billion yen ($4.62 billion) in-force block of individual life annuities through coinsurance.
Toronto-based Manulife said its deal with RGA Canada will see it reinsure reserves at a 16.2 times earnings multiple and about 1 times book value multiple. Manulife said that with the deal it expects to dispose of C$600 million of alternative long-duration assets.
The coinsurance transaction is expected to cut annual net income by about C$40 million, but result in a capital release of C$800 million, Manulife said.
It added it has approval from Canada's Office of the Superintendent of Financial Institutions to amend its existing normal course issuer bid, allowing it to buy back for cancellation up to 90 million shares, 40 million more than previously planned. Under the buyback program, which is set to expire Feb. 22, 2025, it has already bought almost 5 million shares.
Write to Robb M. Stewart at robb.stewart@wsj.com
(END) Dow Jones Newswires
March 25, 2024 09:51 ET (13:51 GMT)
Copyright (c) 2024 Dow Jones & Company, Inc.-
Why Immigration Has Boosted Job Gains and the Economy
-
What to Invest in During High Inflation
-
Never Mind Market Efficiency: Are the Markets Sensible?
-
Starbucks Stock Could Use a Pick-Me-Up After Big Selloff; Is it a Buy?
-
5 Cheap Stocks to Buy From an Attractive Part of the Market
-
Markets Brief: All Eyes On Inflation
-
5 Things We Learned From the Q1 Earnings Season
-
After Earnings, Is Palantir Stock a Buy, a Sell, or Fairly Valued?
-
Going Into Earnings, Is Target Stock a Buy, a Sell, or Fairly Valued?
-
Walmart Earnings: Low Prices and Strong Digital Presence Drive Market Share Gains
-
After Earnings and a Big Selloff, Is Shopify Stock a Buy, a Sell, or Fairly Valued?
-
Cisco Earnings: Positive Guidance and Splunk Inclusion Align With Our Long-Term Thesis
-
3 Warren Buffett Stocks to Buy After Berkshire Hathaway’s Just-Released 13F Filing
-
Going Into Earnings, Is Nvidia Stock a Buy, a Sell, or Fairly Valued?
-
After Earnings, Is Arista Stock a Buy, a Sell, or Fairly Valued?
-
A Cheap Dividend Aristocrat to Buy Before It Bounces Back