Manulife Financial Corporation

Manulife said Q2 2026 core EPS increased 16% year over year, driven by 12% core earnings growth and share buybacks. Net income was $2.1 billion, helped by higher-than-expected public equity returns, and core ROE was 16.3%, up 130 basis points from the prior year quarter. APE sales rose 21% year over year, new business CSM increased 16%, CSM balance grew 20%, and Global WAM reported $0.4 billion of net inflows. On the balance sheet, LICAT was 136% and financial leverage was 22.2%. For guidance, management said Canada insurance experience should trend neutral by the end of 2026, and the company remains on track with its 2.5% share buyback program and 2027 remittances target. They also said the corporate result should be between $300 million and $400 million, likely toward the top end, and that the LTC deal has a modest negative cede with little impact on core earnings or net income.

Phil Witherington emphasized disciplined execution, portfolio diversification and continued strategic progress, highlighting strong sales, earnings and capital strength. He framed the LTC reinsurance deal as another step in de-risking the in-force book while preserving asset management, earnings potential and capital generation from the retained portfolio. His tone was constructive and confident, especially around Asia growth, AI adoption, customer innovation and the company’s ability to manage LTC organically while keeping strategic flexibility.

Colin Simpson focused on the quarter’s financial strength and the drivers behind it. He cited 16% core EPS growth, $2.1 billion of net income, 136% LICAT, $26 billion of excess capital over the supervisory target and a 22.2% leverage ratio, while noting $1.4 billion returned to shareholders in the quarter and $5.3 billion over the last 12 months. He also highlighted margin improvement in Global WAM to 31.2%, explained that Canada core earnings fell 10% on unfavorable claims and expense experience, and said the company is still pursuing the 2.5% buyback program without needing materially higher repurchases to reach the 18% ROE goal.

Analysts focused heavily on two issues: the China/Hong Kong tax and regulatory backdrop for offshore/MCV sales, and the economics of the new LTC reinsurance structure. Management said Hong Kong’s domestic franchise is the main strength, that MCV sales are important but not the whole business, and that any regulatory changes may create short-term noise but are not expected to destroy the outlook; they also said there was no evidence of front-running in the quarter. On LTC, management clarified that the deal is a biometric-risk-only transfer, with no asset transfer, and that retaining the assets preserves earnings and capital generation; they also said the current 2.5% buyback pace is still consistent with the 18% ROE objective. Canada LTD and group insurance were another area of focus, with management saying current actions, case management and annual repricing support a year-end move toward neutral experience.