Manulife Financial Corporation

Reported Q2 2026 results included APE sales growth of 21% year over year, new business CSM growth of 16%, CSM balance growth of 20%, core EPS growth of 16%, core earnings growth of 12%, and core ROE of 16.3% (up 130 basis points). Global WAM reported net inflows of $0.4 billion and core EBITDA margin of 31.2% (up 110 basis points). Net income was $2.1 billion. On the balance sheet, LICAT was 136%, leverage was 22.2%, adjusted book value per share was $41.12, and Manulife said it returned $1.4 billion to shareholders in the quarter and $5.3 billion over the past 12 months. For guidance, management said Canada insurance experience is expected to trend neutral by year-end, the LTC transaction is largely capital neutral with foregone core earnings of CAD 30 million annually in year one, and the company remains on track for its 2027 / medium-term targets, including a 2.5% share buyback program and an 18%-plus core ROE target.

Phil Witherington framed the quarter as evidence of disciplined execution across a diversified platform, citing strong sales, earnings growth and a solid capital position. Strategically, he emphasized AI, longevity solutions, agency force quality in Asia, and continued product innovation, while also highlighting a third LTC reinsurance transaction as another step in derisking the in-force book. His tone was constructive and confident, but not complacent; he repeatedly pointed to preserving earnings power and optionality while improving the risk profile.

Colin Simpson focused on the financial drivers behind the quarter: 21% APE sales growth, 16% core EPS growth, 12% core earnings growth, and net income of $2.1 billion. He noted that Global WAM’s 9% core earnings growth came despite eMPF transition pressure, that Canada core earnings fell 10% due to unfavorable claims and expenses, and that the U.S. improved on claims and lower ECL charges. He also highlighted a strong capital position with a 136% LICAT ratio, $26 billion of excess capital versus the supervisory target, leverage of 22.2%, and meaningful shareholder returns through dividends and buybacks; he said the buyback pace is consistent with achieving the 18% ROE objective without needing outsized repurchases.

Analysts focused heavily on the Hong Kong / China offshore policy tax headlines and whether they could disrupt MCV sales. Management said the domestic Hong Kong franchise is the core strength, MCV is an important but not dominant part of the business, and they do not expect those sales to go to zero; they see any impacts as potentially short term and manageable. Another major topic was the new LTC reinsurance structure: management said it is a biometric-risk-only transfer, not an asset transfer, with a modest negative cede and no major capital release, but it preserves asset management economics and earnings power. Analysts also pressed on Canada LTD weakness and buyback capacity; management said disability claims are being hit by mental health and economic softness, but targeted claims management, recoveries and annual repricing should help experience move toward neutral by year-end.