Manulife Financial Corporation reported net income attributed to shareholders of C$1.8 billion for the second quarter of 2025, an increase of C$0.7 billion from the same period in 2024.
The company’s core earnings for the quarter totaled C$1.7 billion, a 2% decline compared to the prior-year period.
The drop in core earnings reflected adverse life insurance claims in the US and increased expected credit loss (ECL) provisions, which offset growth in other business segments. Global Wealth and Asset Management (Global WAM), Asia, and Canada all recorded higher core earnings year over year.
Asia saw a 13% increase in core earnings, supported by continued business growth, improved claims experience, and better contribution from new business. These gains were partially reduced by strengthened ECL provisions.
Global WAM posted a 19% increase in core earnings, driven by higher net fee income from favorable market performance over the past year, net inflows, performance fees, and controlled expenses. However, the business faced pressure from lower fee spreads and higher taxes.
In Canada, core earnings rose 4%, as growth in Group Insurance and wider investment spreads more than compensated for the absence of a release in ECL provisions and the impact of a prior reinsurance transaction with RGA.
In contrast, US core earnings declined 53%, reflecting unfavorable life insurance claims experience, lower investment spreads, and higher ECL provisions. The Corporate and Other segment improved by C$12 million, mainly due to lower long-term incentive compensation.
The second-quarter results followed a mixed first quarter in 2025, where Manulife posted core earnings of C$1.8 billion, down 1% on a constant exchange rate basis. Net income for the first quarter had declined to approximately C$500 million, as the company dealt with higher ECL provisions and losses related to wildfires.
“As we write Manulife's next chapter, I'm confident our strong commitment to customers, digital and AI-enabled solutions, will set new standards for excellence, efficiency, and sustainable growth across our global franchise,” president and CEO Phil Witherington said.
Manulife reported strong gains in new business metrics, with annualized premium equivalent (APE) sales, new business contractual service margin (CSM), and new business value (NBV) rising 15%, 37%, and 20%, respectively.
In Asia, APE sales increased 31%, new business CSM rose 34%, and NBV grew 28%, supported by higher volumes in Hong Kong and other Asian markets. The NBV margin was 40%, holding steady year over year and improving sequentially.
In Canada, APE sales declined 34%, attributed to the absence of a large Group Insurance case in Q2 2024. Despite this, NBV edged up by 1%, helped by a more favorable product mix, while new business CSM rose 32% due to growth in Individual Insurance.
In the US, APE sales increased 40%, new business CSM climbed 59%, and NBV grew 12%, reflecting continued interest in accumulation insurance products.
Global WAM reported net inflows of C$0.9 billion, an increase from C$0.1 billion a year earlier. Retirement net inflows totaled C$2.0 billion, compared to net outflows of C$1.3 billion in Q2 2024, reflecting higher sales across all regions and the absence of a large redemption that occurred in the US last year.
Retail net outflows widened to C$3.2 billion, up from C$0.1 billion in the prior-year quarter, driven by weaker sales through third-party intermediaries in North America and money market funds in mainland China. These outflows were partially offset by stronger sales through Manulife’s retail wealth platform.
Institutional Asset Management recorded net inflows of C$2.1 billion, up from C$1.4 billion a year ago, supported by reduced redemptions in fixed income mandates. This was partially offset by increased redemptions in equity mandates.
During the first half of the year, Manulife finalized a reinsurance transaction with Reinsurance Group of America (RGA) involving the transfer of approximately C$2.4 billion in long-term care reserves. Effective Jan. 1, the deal reduced Manulife's long-term care reserves by 18% and released C$800 million in capital.
Manulife’s brand value also saw notable growth in 2025, increasing by 22% to C$9.5 billion, according to the Canada 100 rankings. This marked the fastest growth among the top 10 Canadian insurance brands and was largely attributed to business momentum across Asian markets.
As of June 30, 2025, Manulife reported a contractual service margin balance of C$22.316 billion, supported by new business activity.
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