Reinsurance Group of America, Inc. posted a solid start to the year with first-quarter net income of US$286 million, or US$4.27 per diluted share, up from US$210 million and US$3.16 per share in the same quarter of 2024.
Adjusted operating income was US$378 million, or US$5.66 per diluted share, compared to US$401 million and US$6.02 per share a year ago, with results impacted by lower variable investment income and currency headwinds.
CEO Tony Cheng called the results “very good” and praised the strength of the company’s Traditional segment, which saw favorable biometric claims across all regions, generating a positive economic impact of US$196 million and contributing US$58 million to the quarter’s financial results.
RGA deployed US$418 million in capital to in-force block transactions during the quarter and maintained a robust financial position with an estimated US$1.9 billion in excess capital and US$1.3 billion in deployable capital, not including the pending transaction with Equitable Holdings, expected to close mid-year.
|
Metric |
Q1 2025 |
Q1 2024 |
|---|---|---|
|
Net income per diluted share |
US$4.27 |
US$3.16 |
|
Adjusted operating income per share |
US$5.66 |
US$6.02 |
|
Book value per share (ex-AOCI) |
US$153.80 |
US$145.83 |
|
ROE (Trailing 12 Months) |
7.5% |
— |
|
Adjusted Operating ROE (TTM) |
13.4% |
— |
|
Adjusted Operating ROE ex-notable items (TTM) |
15.0% |
— |
Consolidated net premiums totaled US$4.02 billion, a 25% decrease from Q1 2024 primarily due to a US$1.8 billion decline in US Financial Solutions premiums compared to last year’s large single premium pension risk transfer transaction. Adjusting for this, net premiums rose 13%, supported by continued strength in Traditional business lines across all geographies.
Investment income rose 13% (excluding spread-based business) due to higher average invested assets, although overall yields decreased slightly to 4.64% due to lower variable income.
The effective tax rate for the quarter was 21.9%, below expectations, due to US tax benefits linked to foreign taxes.
The Corporate and Other segment recorded a US$70 million loss, affected by one-time items and weaker variable investment income.
RGA reaffirmed the pending US$32 billion reinsurance agreement with Equitable Holdings, announced in February. The transaction will cover 75% of Equitable’s in-force life insurance liabilities, including US$18 billion in general account and US$14 billion in separate account reserves. It is expected to close in mid-2025 and expand RGA’s position in the in-force solutions space.
The board of directors declared a quarterly dividend of US$0.89 per share, payable May 27.
RGA will host its Q1 earnings call on May 2 at 10 a.m. ET. Supporting materials, including an investor presentation and financial supplement, are available on rgare.com.
Do these Q1 results reflect underlying strength or one-off gains? Let us know what you think.
