Manulife Q4 loss hits $1.87B

Manulife Financial said it lost $1.87 billion in fourth quarter, surpassing the $1.5-billion loss it forecast in early December.

The Toronto-based company said unfavourable movements late in the quarter exacerbated the "impact of unprecedented declines in equity markets."

The company said it lost $1.24 a share in the quarter. In the same three-month period of 2007, Manulife made a profit of $1.14 billion, or 75 cents a share.

Manulife 3-month TSX chartThe firm's fourth-quarter results for last year include $2.41 billion to cover segregated fund guarantees, other equity related losses of $513 million, plus credit impairments and downgrades of $128 million.

"As previously disclosed, our results have been negatively impacted by the downturn in global equity markets, particularly in the fourth quarter," said Dominic D'Alessandro, Manulife's president and CEO.

"We have reacted quickly by strengthening our capital base and ensuring that our product strategies remain appropriate for the long term," he said in a statement.

Investors reacted by sending Manulife shares down 68 cents to $18.68 in morning trading on the Toronto Stock Exchange.

For the full year, Manulife posted a profit of $517 million, off from $4.3 billion in 2007.

The firm's funds under management as of Dec. 31 were $404.5 billion, an increase of two per cent over the prior year.

Manulife said increases from currency movements of $64 billion, policyholder cash flows of $18 billion and investment income of $13 billion were overshadowed by a $90-billion decrease in assets due to market value declines.