Manulife Reports Second Quarter 2025 Results

Executive Summary

• Manulife reported second quarter 2025 results with net income attributed to shareholders of $1.8 billion, an increase of $0.7 billion compared to the prior year period.
• Core earnings were $1.7 billion, a 2% decrease on a constant exchange rate basis, driven by unfavorable life insurance claims experience in the U.S. and strengthened expected credit loss provisions, which were partially offset by strong growth in Asia and Global Wealth and Asset Management.
• The company announced the agreement to acquire a 75% stake in Comvest Credit Partners, adding US$14.7 billion to its Global WAM platform, expected to close in Q4 2025.

Key Details

• Financial Performance (Q2 2025 vs Q2 2024):
  • Net income attributed to shareholders: $1.8 billion (up from $1.0 billion).
  • Core earnings: $1.7 billion (down 2% on a constant exchange rate basis).
  • Core earnings excluding the impact of the change in expected credit loss (ECL): $1.8 billion (up 2%).
  • Earnings per share (EPS): $0.98 (up 88%).
  • Core EPS: $0.95 (up 2%).
  • Core EPS excluding the impact of the change in ECL: $0.99 (up 7%).
  • Core Return on Equity (ROE): 15.0%.
  • ROE: 15.6%.
  • Book value per common share: $24.90 (up 5%).
  • Adjusted book value per common share: $35.78 (up 7%).
  • Life Insurance Capital Adequacy Test (LICAT) ratio: 136%.
• Business Segment Highlights:
  • Asia: Core earnings of $520 million (up 13%); APE sales up 31%; New business CSM up 34%; NBV up 28%.
  • Canada: Core earnings of $419 million (up 4%); APE sales down 34% (due to non-recurrence of a large-case Group Insurance sale); New business CSM up 32%; NBV up 1%.
  • U.S.: Core earnings of $141 million (down 53%); APE sales up 40%; New business CSM up 59%; NBV up 12%.
  • Global Wealth and Asset Management (Global WAM): Core earnings of $463 million (up 19%); Net inflows of $0.9 billion (up from $0.1 billion); Core EBITDA margin of 30.1% (up 380 basis points).
• New Business Metrics:
  • Aggregate APE sales: $2.2 billion (up 15%).
  • New business CSM: $882 million (up 37%).
  • New business value (NBV): $846 million (up 20%).
• Strategic Initiatives & Operations:
  • AI Integration: Ranked first in the life insurance sector for AI maturity in the inaugural Evident AI Index for Insurance. Launched AI-powered sales enablement in U.S. Retirement, GenAI call analysis tool "VOICE" in Asia, GenAI for long-term care claims processing in the U.S., and a digital travel insurance platform in Canada.
  • Distribution & Product: Established a dedicated office in the Dubai International Financial Centre for high-net-worth customers; launched a diversified real assets strategy in Malaysia; introduced four new actively managed ETF series in Canada; partnered with Maven Clinic for virtual health support.
  • Shareholder Returns: $1.1 billion in common share buybacks since the start of the year.
• M&A Activity:
  • Agreed to acquire a 75% stake in Comvest Credit Partners.
  • Transaction adds US$14.7 billion to the Global WAM platform (includes US$11 billion fee-paying AUM and US$3.7 billion committed capital).
  • Expected to close in the fourth quarter of 2025, subject to customary closing conditions.

Notable Quotes

• Phil Witherington, President & CEO: "Our second-quarter results underscore the strength and resilience of our global franchise, as we continue to deliver high-quality growth across a diversified portfolio... Investing in our high-potential businesses with strategically focused intent is critical, and I'm excited to announce our acquisition of Comvest Credit Partners, adding highly complementary and scaled capabilities in private credit..."
• Colin Simpson, CFO: "While core EPS growth was dampened by headwinds related to unfavourable life insurance claims experience in the U.S. and strengthened expected credit loss provisions, the underlying fundamentals of our businesses remained robust and we are reporting strong earnings growth in Global WAM, Asia and Canada... Book value per common share was resilient with a 5% increase year over year, and we continue buying back common shares, including $1.1 billion since the start of the year, demonstrating our steadfast commitment to enhancing shareholder value."