Sun Life Financial Inc. has reported net income of $391-million for the first quarter of 2020, compared to $623-million for Q1 2019 – a decrease of 37 per cent. Underlying net income, however, increased seven per cent to $770-million, up from $717-million reported in the first quarter of 2019.

Impact of COVID-19 pandemic

“Our reported net income for the quarter of $391-million was impacted by market declines brought on by the COVID-19 pandemic,” says Sun Life’s president and CEO, Dean Connor. “While it’s difficult to determine today how the business will be impacted by future claims and investment experience, we entered the second quarter in a position of strength, with a strong balance sheet, and with a LICAT ratio of 143 per cent.”

The company says notwithstanding market effects on its reported net income in the first quarter of 2020, COVID-19 impacts on underlying net income and other financial metrics, including sales, claims and benefits, premiums and fee income were not significant.

Canadian division loss

The company’s Canadian division reported a net loss of $42-million in the first quarter, compared to reported net income of $237-million in the same period in 2019. Canadian insurance sales were $295-million, a decrease of $67-million or 19 per cent, compared to the same period in 2019. Wealth sales were up to $5.6-billion, an increase of $2.8-billion, driven by higher retained sales in the large case group retirement services market and strong sales in individual wealth.

Alongside its earnings announcement, the company’s board of directors also announced that Sun Life will pay a dividend of $0.55 per share on common shares of the company, payable June 30, 2020 to shareholders of record on May 27, 2020. Preferred share dividends ranging from $0.14 per share to $0.30 per share were also declared, payable on June 30 to shareholders of record at the close of business on May 27.