Sun Life’s net income declines in third quarter

By The IJ Staff | November 13 2018 09:30AM

Dean Connor

Sun Life Financial reported net income of $567 million for the third quarter of 2018 compared to $817 million for the same quarter of 2017.

The company’s Q3 2018 net income included “the unfavourable impact of $166 million of assumption changes and management actions  in 2018, compared to the favourable impact of $103 million in 2017. As well, the change in market impacts between the two periods was unfavourable by $88 million,” explained Sun Life in a Nov. 7 announcement.

Q3 2018 underlying net income increased $87 million to $730 million compared to 2017. This improvement was “primarily driven by business growth, the lower income tax rate in the U.S., and favourable investment experience, partially offset by new business strain in SLF Asia and in SLF Canada as well as less favourable mortality experience.”

"In the third quarter, underlying net income was strong at $730 million, and (underlying) return on equity was 14 per cent, at the high end of our target range," said Dean Connor, President and CEO, Sun Life Financial. "We are pleased to announce an increase in our common share dividend of 5 per cent to $0.50, reflecting confidence in our strong capital position and growth prospects."

Canadian results

SLF Canada's reported net income was $335 million for the quarter. This is a decline of $5 million compared to the same period in 2017, which mainly reflects less favourable market related impacts, says the company.

SLF Canada insurance sales declined 6 per cent during the third quarter, mainly “as a result of large case sales in Group Benefits in 2017,” says the company.