MFC 0001086888-24-000016 6-K as filed: Nov 6, 2024

Third Quarter

Report to

Shareholders

Three and nine months ended

September 30, 2024

Manulife Financial Corporation

1 Record levels of total company annualized premium equivalent (“APE”) sales, new business contractual service margin (“new business CSM”) and new business

value (“NBV”).

2 Core earnings is a non-GAAP financial measure. For more information on non-GAAP and other financial measures, see “Non-GAAP and other financial

measures” in our 3Q24 Management’s Discussion and Analysis (“3Q24 MD&A”).

3 Percentage growth / declines in core earnings, diluted core earnings per common share (“core EPS”), diluted earnings (loss) per share (“EPS”), core EPS

excluding the impact of GMT, and new business contractual service margin net of NCI (“new business CSM”) are stated on a constant exchange rate basis and

are non-GAAP ratios.

4 Core EPS, core EPS excluding the impact of GMT, core ROE, core EBITDA margin, highest potential businesses core earnings contribution, and expense

efficiency ratio are non-GAAP ratios.

5 On June 20, 2024, Canada enacted the Global Minimum Tax Act. The impact was reflected in Corporate & Other in situations where GMT was not substantively

enacted in local jurisdictions where we operated as of September 30, 2024.

6 Life Insurance Capital Adequacy Test (“LICAT”) ratio of The Manufacturers Life Insurance Company (“MLI”) as at September 30, 2024. LICAT ratio is disclosed

under the Office of the Superintendent of Financial Institutions Canada’s (“OSFI’s”) Life Insurance Capital Adequacy Test Public Disclosure Requirements

guideline.

7 For more information on APE sales, NBV, and Global Wealth and Asset Management (“Global WAM”) net flows, see “Non-GAAP and other financial measures” in

our 3Q24 MD&A. Percentage growth/decline in APE sales and NBV are stated on a constant exchange rate basis.

8 Refer to “Results at a Glance” for 3Q24 and 3Q23 results.

9 As of October 31, 2024.


Manulife Financial Corporation – Third Quarter 2024		1

Manulife Financial Corporation (“Manulife” or the “Company”) reported its third quarter results for the

period ended September 30, 2024, delivering record core earnings and insurance new business results1.

Key highlights for the third quarter of 2024 (“3Q24”) include:

•Core earnings2 of $1.8 billion, up 4% on a constant exchange rate basis3 from the third quarter of 2023

(“3Q23”)

•Net income attributed to shareholders of $1.8 billion, up $0.8 billion from 3Q23

•Core EPS4 of $1.00, up 7%3 from 3Q23. EPS of $1.00, up 91%3 from 3Q23

•Excluding the impact of Global Minimum Taxes (“GMT”)5, core EPS4 was $1.03, up 11%3 from 3Q23

•Core ROE4 of 16.6% and ROE of 16.6%

•LICAT ratio6 of 137%

•APE sales up 40%7, new business CSM up 47%3 and new business value (“NBV”) up 39%7 from 3Q238

•Global Wealth and Asset Management net inflows7 of $5.2 billion, up from net outflows of $0.8 billion in 3Q23

“We continued to drive momentum and delivered strong results in the third quarter, evident in record total

company core earnings, substantial top-line growth across our operating segments and steady growth in our

book value per share. In Global WAM, we generated a 37% increase in core earnings year-over-year, and our

core EBITDA margin4 further improved to 27.8% driven by strong AUMA growth and higher operating leverage.

In Asia, we reached record levels of APE sales, new business CSM and NBV, while delivering 17% growth in

core earnings. On a year-to-date basis, we generated 70% of core earnings from our highest potential

businesses4 which contributed to a 14% growth in core EPS excluding the impact of GMT. We remain focused

on executing against our strategic priorities and delivering on our financial targets to bring a strong close to

2024, and I am optimistic in our ability to continue generating value to our shareholders.”

— Roy Gori, Manulife President & Chief Executive Officer

“We have made progress on our financial targets unveiled at our Investor Day this year. Core ROE of 16.6%

reflects strong business performance and disciplined capital allocation. We remain diligent in our expense

management with 45.0% expense efficiency ratio4 on a year-to-date basis, in-line with our medium-term target

of less than 45%. Our balance sheet is strong, and we returned more than $2 billion to our shareholders

through our common share buyback program since the start of 20249.”

— Colin Simpson, Manulife Chief Financial Officer

1 Percentage growth / declines in net income attributed to shareholders is stated on a constant exchange rate basis and is a non-GAAP ratio.

2 For more information on gross flows and average asset under management and administration (“average AUMA”), see “Non-GAAP and other financial measures”

in our 3Q24 MD&A. Percentage growth/decline in net flows, gross flows and average AUMA are stated on a constant exchange rate basis.

3 Adjusted book value per common share (“adjusted BV per common share”) and financial leverage ratio are non-GAAP ratios.


Manulife Financial Corporation – Third Quarter 2024		2

Results at a Glance


($ millions, unless otherwise stated)	Quarterly Results					YTD Results
($ millions, unless otherwise stated)	3Q24		3Q23		Change1,2	2024		2023		Change
Net income attributed to shareholders	$	1,839	$	1,013	82%	$	3,747	$	3,444	8%
Core earnings	$	1,828	$	1,743	4%	$	5,319	$	4,911	8%
EPS ($)	$	1.00	$	0.52	91%	$	1.97	$	1.76	11%
Core EPS ($)	$	1.00	$	0.92	7%	$	2.84	$	2.55	12%
ROE		16.6%		9.5%	7.1 pps		11.3%		10.8%	0.5 pps
Core ROE		16.6%		16.8%	-0.2 pps		16.3%		15.7%	0.6 pps
Book value per common share ($)	$	24.40	$	22.42	9%	$	24.40	$	22.42	9%
Adjusted BV per common share ($)3	$	34.97	$	30.67	14%	$	34.97	$	30.67	14%
Financial leverage ratio (%)3		23.5%		25.2%	-1.7 pps		23.5%		25.2%	-1.7 pps
APE sales	$	2,347	$	1,657	40%	$	6,137	$	4,890	26%
New business CSM	$	759	$	507	47%	$	2,045	$	1,541	33%
NBV	$	843	$	600	39%	$	2,235	$	1,694	32%
Global WAM net flows ($ billions)	$	5.2	$	(0.8)	-%	$	12.0	$	5.8	110%

Results by Segment


($ millions, unless otherwise stated)	Quarterly Results					YTD Results
($ millions, unless otherwise stated)	3Q24		3Q23		Change2	2024		2023		Change
Asia (US$)
Net income attributed to shareholders	$	606	$	63	877%	$	1,300	$	543	136%
Core earnings		453		390	17%		1,413		1,104	31%
APE sales		1,372		835	64%		3,242		2,582	28%
New business CSM		435		300	45%		1,148		845	38%
NBV		481		310	55%		1,194		900	35%
Canada
Net income attributed to shareholders	$	430	$	290	48%	$	782	$	826	(5)%
Core earnings		412		408	1%		1,178		1,135	4%
APE sales		343		431	(20)%		1,313		1,046	26%
New business CSM		95		51	86%		241		154	56%
NBV		143		153	(7)%		459		351	31%
U.S. (US$)
Net income attributed to shareholders	$	5	$	53	(91)%	$	23	$	327	(93)%
Core earnings		302		329	(8)%		940		955	(2)%
APE sales		97		79	23%		303		275	10%
New business CSM		52		40	30%		178		187	(5)%
NBV		34		25	36%		112		99	13%
Global WAM
Net income attributed to shareholders	$	498	$	318	55%	$	1,213	$	932	29%
Core earnings		499		361	37%		1,255		968	29%
Gross flows ($ billions)2		41.3		34.3	19%		128.2		108.2	18%
Average AUMA ($ billions)2		963		813	16%		924		812	13%
Core EBITDA margin (%)		27.8%		26.9%	90 bps		26.6%		24.7%	190 bps

1 Manulife Pro is available in Singapore, Vietnam, Indonesia, Japan and Hong Kong.

2 Net promoter score (“NPS”).

3 Compared with registration in May 2024, prior to the soft launch of the app in June 2024.

4 Jianhui Zhao, Liying Xu, et al - Global trends in incidence, death, burden and risk factors of early-onset cancer from 1990 to 2019: BMJ Oncology 2023.


Manulife Financial Corporation – Third Quarter 2024		3

Strategic Highlights

We are driving profitable top-line growth through product and distribution innovations

In Asia, we continued the rollout of Manulife Pro, our proprietary recognition and activation program for top-tier

agents, to Hong Kong in July. This key initiative contributed to improved productivity, reflecting our investments in

our agency force and contributing to over 20% year-over-year growth in agency NBV and agency APE sales in

3Q24. With this expansion Manulife Pro is now available in five of our markets1.

In addition, we further enhanced our high-net-worth offerings with the launch of two innovative new products:

Manulife Global Indexed UL PRO in our International High Net Worth business and Signature Indexed Income in

Singapore. These offerings build on our capabilities to meet the complex and evolving protection, legacy planning

and wealth management needs of high-net-worth customers.

In the U.S., we expanded a differentiated enhancement to our entire suite of survivorship solutions, allowing

customers to proactively address their estate planning needs now in anticipation of potential estate tax changes in

2026.

In Global WAM, we announced the closing of a $1.1 billion institutional fund - Manulife Private Equity Partners II.

This fund is part of our ongoing effort to provide specialized solutions for institutional investors seeking greater

exposure to opportunities in the growing North American private equity market.

We are elevating the customer experience with continued digital and AI enhancements

In Asia, we improved customer experience and the operational efficiency of our Japan contact centre as part of

global contact centre transformation initiatives. Our further enhancement of voice bot capabilities and the

application of AI contributed to a record high transactional NPS2 on a year-to-date basis. AI-enabled speech-to-text

and call summarization enhancements reduced average contact centre handling time by 28% compared with

3Q23.

Furthermore, we launched new mobile apps in Vietnam and Indonesia as part of our program to create a unified

customer app experience in each of our Asia markets. These apps now enable customers to seamlessly conduct a

wide range of policy management activities including accessing policy information, making premium payments,

tracking claim status, updating personal information and downloading contracts. Since the launch of the new

mobile app in Vietnam in August, monthly customer registrations have nearly doubled3.

In the U.S., we entered into a strategic distribution partnership with Ethos – a life insurance technology company

focused on simplifying the purchase experience – to provide prospective customers and nearly 9,000 newly

appointed agents with instant coverage decisions for our Simple Term solution via the Ethos platform.

In Global WAM, we launched an AI-powered planning tool in our wealth platform in Canada Retail to enhance

support for advisors and their clients, delivering an elevated service experience through streamlined financial

planning processes and personalized advice and solutions.

We are helping our customers live longer, healthier, and better lives

In Canada, we further enhanced our mobile app for the Manulife Vitality program with tailored activity

recommendations to provide customers with a more personalized app experience to help them achieve their

health and wellness goals. Continuous improvements have resulted in a 9% increase in utilization year-over-year.

In the U.S., we provided access to GRAIL’s Galleri® multi-cancer early detection test to certain eligible John

Hancock Vitality members ages 40 to 49 (previously ages 50 and up). This change aligns our offering with recent

medical research indicating a significant increase in early-onset cancer diagnoses4, reinforcing our commitment to

early detection and better health outcomes for our members.

1 See section A1 “Profitability” in our 3Q24 MD&A for more information on notable items attributable to core earnings and net income attributed to shareholders.

2 For more information on new business value margin (“NBV margin”), see “Non-GAAP and other financial measures” below.


Manulife Financial Corporation – Third Quarter 2024		4

Strong earnings driven by continued business growth and improved market experience1

Core earnings of $1.8 billion in 3Q24, up 4% from 3Q23

The increase reflected strong business growth led by Global WAM and Asia, and a lower net charge in the

provision for Expected Credit Loss (“ECL”), more than offsetting the impacts of GMT and reinsurance transactions

closed earlier this year.

•Asia core earnings were up 17%, reflecting continued business growth momentum and benefits from

updates to actuarial methods and assumptions in 2023 and 2024.

•Global WAM core earnings hit a record level in 3Q24 and grew 37%, driven by higher net fee income

from favourable market impacts and positive net flows, favourable tax true-ups and benefits, and

continued expense discipline.

•Canada core earnings increased 1% as strong business growth in Group Insurance more than offset the

impact of less favourable claims experience in 3Q24.

•U.S. core earnings were down 8%, primarily due to lower investment spreads, impact from the previously

completed reinsurance transaction and the annual review of actuarial methods and assumptions, partially

offset by a lower charge in the ECL provision and more favourable claims experience in life.

•Corporate and Other core earnings decreased $123 million, mainly due to the impact of GMT and higher

interest on capital allocated to operating segments.

Net Income attributed to shareholders of $1.8 billion in 3Q24, $0.8 billion higher compared with 3Q23

The $0.8 billion increase in net income reflects improved market experience and core earnings growth, partially

offset by lower tax-related benefits and a higher net charge from the annual review of actuarial methods and

assumptions. The net gain from market experience in 3Q24 was primarily related to higher-than-expected returns

from public equity and net realized gains from the sale of debt instruments, partially offset by lower-than-expected

returns on alternative long-duration assets mainly related to real estate investments.

Record levels across all three insurance new business metrics for total company and Asia segment, and

strong net inflows in Global WAM

Significant momentum continued into 3Q24 as the insurance business generated year-over-year growth

of 40%, 47% and 39% in APE sales, new business CSM and NBV, respectively.

•Asia led with broad-based growth, generating 64%, 45% and 55% year-over-year growth in APE sales,

new business CSM and NBV, respectively, reflecting higher sales volumes in Hong Kong, mainland

China, Singapore and Japan. NBV margin2 remained resilient at 38.8%.

•Canada delivered solid new business results; higher sales in participating life insurance and Group

Insurance were more than offset by the non-recurrence of a large affinity market sale in 3Q23. APE sales

and NBV were down 20% and 7%, respectively, while new business CSM increased 86% due to strong

individual insurance and segregated fund sales.

•U.S. delivered double-digit growth in APE sales, new business CSM and NBV of 23%, 30% and 36%,

respectively, reflecting a rebound in demand from affluent customers for accumulation insurance

products.

Global WAM net inflows of $5.2 billion in 3Q24, increased $6.0 billion compared with net outflows of $0.8

billion in 3Q23, reflecting strong Retail net flows across all geographies

•Retirement net inflows of $0.6 billion in 3Q24 increased from net outflows of $3.4 billion in 3Q23, primarily

driven by the non-recurrence of a large-case retirement plan redemption in the U.S. in 3Q23.

•Retail net inflows of $3.9 billion in 3Q24 increased from net outflows of $0.2 billion in 3Q23, due to

increased demand for investment products amid an equity market recovery and improved investor

sentiment, as well as the onboarding of several new advisors in Canada wealth.

•Institutional Asset Management net inflows of $0.7 billion in 3Q24 decreased compared with net inflows of

$2.8 billion in 3Q23, reflecting higher redemptions in fixed income mandates.

1 Net of non-controlling interests (“NCI”).

2 Post-tax contractual service margin net of NCI (“post-tax CSM net of NCI”) is a non-GAAP financial measure. For more information on non-GAAP and other

financial measures, see “Non-GAAP and other financial measures” in our 3Q24 MD&A.

3 This amount excludes the portion related to NCI.


Manulife Financial Corporation – Third Quarter 2024		5

Growth in new business continues to drive higher organic CSM and CSM balance

CSM1 was $20,930 million as at September 30, 2024

CSM increased $490 million compared with December 31, 2023. Organic CSM movement contributed $724

million of the increase for the first three quarters of 2024, primarily driven by the impact of new business and

interest accretion, partially offset by amortization recognized in core earnings and adverse insurance experience.

Inorganic CSM movement was a decrease of $234 million for the same period, primarily driven by the impacts of

reinsurance transactions and the annual review of actuarial methods and assumptions, partially offset by

favourable impacts of changes in foreign currency exchange rates and equity market performance. Post-tax CSM

net of NCI2 was $18,595 million as at September 30, 2024.

Annual Review of Actuarial Methods and Assumptions

We completed our annual review of actuarial methods and assumptions, which resulted in a net favourable impact

of a $174 million3 decrease in pre-tax fulfillment cash flows. Under IFRS 17, the impact of the annual review of

actuarial methods and assumptions is reported in several places. The $174 million decrease in pre-tax fulfillment

cash flows in 3Q24 was comprised of a decrease in pre-tax net income attributed to shareholders of $250 million

($199 million post-tax), an increase in pre-tax net income attributed to participating policyholders of $29 million

($21 million post-tax), a decrease in CSM of $421 million, an increase in pre-tax other comprehensive income

attributed to shareholders of $771 million ($632 million post-tax), and an increase in pre-tax other comprehensive

income attributed to participating policyholders of $45 million ($32 million post-tax). The actuarial review this year

included updates to our lapse assumptions for non-participating products in our U.S. life insurance business and

in our International High Net Worth business in Asia segment, updates to discount rates used in the valuation of

our non-participating business, a review of our reinsurance contracts and risk adjustment, updates to our global

expense assumptions, updates to mortality and morbidity assumptions in certain products in Asia, as well as other

methodology refinements.


Manulife Financial Corporation – Third Quarter 2024		6

MANAGEMENT’S DISCUSSION AND ANALYSIS

This Management’s Discussion and Analysis (“MD&A”) is current as of November 6, 2024, unless otherwise noted.

This MD&A should be read in conjunction with our unaudited Interim Consolidated Financial Statements for the

three and nine months ended September 30, 2024 and the MD&A and audited Consolidated Financial Statements

contained in our 2023 Annual Report.

For further information relating to our risk management practices and risk factors affecting the Company, see “Risk

Management and Risk Factors” and “Critical Actuarial and Accounting Policies” in the MD&A in our 2023 Annual

Report (“2023 MD&A”) and the “Risk Management” note to the Consolidated Financial Statements in our most

recent annual and interim reports.

In this MD&A, the terms “Company”, “Manulife”, “we” and “our” mean Manulife Financial Corporation (“MFC”) and

its subsidiaries. All amounts are reported in Canadian dollars, unless otherwise indicated. Any information

contained in, or otherwise accessible through, websites mentioned in this MD&A does not form a part of this

document.

CONTENTS

A. TOTAL COMPANY PERFORMANCE

1.Profitability

2.Business performance

3.Financial strength

4.Assets under management and administration

5.Impact of foreign currency exchange rates

6.Business highlights

7.Strategic priorities

B. PERFORMANCE BY SEGMENT

1.Asia

2.Canada

3.U.S.

4.Global Wealth and Asset Management

5.Corporate and Other

C. RISK MANAGEMENT AND RISK FACTORS

UPDATE

1.Variable annuity and segregated fund guarantees

2.Caution related to sensitivities

3.Publicly traded equity performance risk sensitivities

and exposure measures

4.Interest rate and spread risk sensitivities and

exposure measures

5.Alternative long-duration asset performance risk

sensitivities and exposure measures

6.Strategic and product risk factors update

D. CRITICAL ACTUARIAL AND ACCOUNTING

POLICIES

1.Critical actuarial and accounting policies

2.Actuarial methods and assumptions

3.Sensitivity to changes in assumptions

4.Accounting and reporting changes

E. OTHER

1.Outstanding common shares - selected information

2.Legal and regulatory proceedings

3.Non-GAAP and other financial measures

4.Caution regarding forward-looking statements

5.Quarterly financial information

6.Revenue

7.Other

1 Percentage growth / declines in core earnings, pre-tax core earnings, core expenses, general expenses, contractual service margin (“CSM”) net of non-

controlling interests (“NCI”), new business contractual service margin (“new business CSM”), assets under management and administration (“AUMA”), assets

under management (“AUM”), core earnings before interest, taxes, depreciation and amortization (“core EBITDA”), and Manulife Bank average net lending assets

are stated on a constant exchange rate basis, a non-GAAP ratio. See “Non-GAAP and other financial measures” below for more information.

2 For more information on this metric, see “Non-GAAP and other financial measures” below.

3 The GA Reinsurance Transaction closed February 22, 2024 with an effective date of January 1, 2024. The RGA Reinsurance Transaction closed April 2, 2024.


Manulife Financial Corporation – Third Quarter 2024		7

A TOTAL COMPANY PERFORMANCE

A1 Profitability


	Quarterly Results			YTD Results
($ millions, unless otherwise stated)	3Q24	2Q24	3Q23	2024	2023
Net income (loss) attributed to shareholders	$1,839	$1,042	$1,013	$3,747	$3,444
Core earnings(1)	$1,828	$1,737	$1,743	$5,319	$4,911
Diluted earnings (loss) per common share ($)	$1.00	$0.52	$0.52	$1.97	$1.76
Diluted core earnings per common share (“Core EPS”) ($)(2)	$1.00	$0.91	$0.92	$2.84	$2.55
ROE	16.6%	9.0%	9.5%	11.3%	10.8%
Core return on shareholders’ equity (“Core ROE”)(2)	16.6%	15.7%	16.8%	16.3%	15.7%
Expense efficiency ratio(2)	44.4%	45.4%	44.3%	45.0%	45.5%
General expenses	$1,204	$1,225	$1,042	$3,531	$3,150
Core expenses(1)	$1,716	$1,713	$1,622	$5,102	$4,825
(1) This item is a non-GAAP financial measure. See “Non-GAAP and other financial measures” below for more information. (2) This item is a non-GAAP ratio. See “Non-GAAP and other financial measures” below for more information.

Quarterly profitability

Manulife’s net income attributed to shareholders was $1,839 million in the third quarter of 2024 (“3Q24”) compared

with $1,013 million in the third quarter of 2023 (“3Q23”). Net income attributed to shareholders is comprised of core

earnings (consisting of items we believe reflect the underlying earnings capacity of the business), which amounted

to $1,828 million in 3Q24 compared with $1,743 million in 3Q23, and items excluded from core earnings, which

amounted to a net gain of $11 million in 3Q24 compared with a net charge of $730 million in 3Q23. The effective

tax rate on net income (loss) attributed to shareholders was a tax expense of 11% in 3Q24 compared with a

recovery of 7% in 3Q23 reflecting $100 million of tax benefits in 3Q24 compared with $290 million in 3Q23, a

charge related to Global Minimum Taxes (“GMT”) in 3Q24 and the jurisdictional mix of pre-tax profits.

Net income attributed to shareholders in 3Q24 increased $826 million compared with 3Q23, primarily reflecting

improved market experience and core earnings growth, partially offset by lower tax-related benefits, a higher net

charge from the annual review of actuarial methods and assumptions and a charge to items excluded from core

earnings related to GMT. The net gain from market experience of $186 million in 3Q24 was primarily related to

higher-than-expected returns from public equity and net realized gains from the sale of debt instruments, partially

offset by lower-than-expected returns on alternative long-duration assets (“ALDA”) mainly related to real estate

investments.

Core earnings increased $85 million or 4% on a constant exchange rate basis1 compared with 3Q23. The increase

was driven by higher core earnings in Global Wealth and Asset Management (“Global WAM”), largely reflecting an

increase in net fee income from higher average assets under management and administration2 (“average AUMA”)

and positive net flows2, along with disciplined expense management and favourable tax true-ups and tax benefits.

In addition, growth in our insurance business, a lower charge in the expected credit loss (“ECL”) provision in 3Q24

and the impact of updates to actuarial methods and assumptions in 2023 also contributed to higher core earnings.

These increases were partially offset by lower expected investment earnings and a charge related to GMT. The

reinsurance transaction with Global Atlantic (“GA Reinsurance Transaction”)3 reduced core earnings by $21 million

in 3Q24 compared with 3Q23 reflecting the impact on expected earnings on insurance contracts, expected

investment earnings, and insurance experience. The reinsurance transaction with the RGA Life Insurance

Company of Canada (“RGA Reinsurance Transaction”)3 reduced core earnings by $2 million in 3Q24 compared

with 3Q23.

The components of the items excluded from core earnings are outlined in the table below and the annual review of

actuarial methods and assumptions that flow directly through income is discussed in section D2 “Actuarial methods

and assumptions” below.


Manulife Financial Corporation – Third Quarter 2024		8

Year-to-date profitability

Net income attributed to shareholders for the nine months ended September 30, 2024 was $3,747 million

compared with $3,444 million for the nine months ended September 30, 2023. Year-to-date core earnings

amounted to $5,319 million in 2024 compared with $4,911 million in the same period of 2023, and items excluded

from year-to-date core earnings amounted to a net charge of $1,572 million in 2024 compared with a net charge of

$1,467 million in the same period of 2023. The effective tax rate on year-to-date net income (loss) attributed to

shareholders was 16% in 2024 compared with 12% for the same period in 2023.

Year-to-date net income attributed to shareholders in 2024 increased $303 million compared with 2023 due to

improved market experience in public equities, ALDA, and derivatives and hedge accounting ineffectiveness, and

growth in core earnings. This was partially offset by the impact of the $958 million net loss attributed to the GA and

RGA Reinsurance Transactions recorded in items excluded from core earnings, primarily related to market

experience from the sale of fair value through Other Comprehensive Income (“FVOCI”) debt instruments (there is

an offsetting change in other comprehensive income (“OCI”) attributed to shareholders resulting in a neutral impact

to book value), lower tax-related benefits, a higher net charge from the annual review of actuarial methods and

assumptions and a charge to items excluded from core earnings related to GMT. Year-to-date market experience

was a net charge of $1,258 million in 2024 primarily reflecting the net loss from above-noted GA and RGA

Reinsurance Transactions, lower-than-expected returns on ALDA, largely related to real estate and private equity

investments, partially offset by higher-than-expected returns on public equities and a gain from derivatives and

hedge accounting ineffectiveness.

Year-to-date core earnings in 2024 increased $408 million or 8% compared with the same period of 2023. The

increase was driven by higher core earnings in Global WAM, reflecting an increase in net fee income from higher

average AUMA and positive net flows, along with disciplined expense management and tax true-ups and tax

benefits. In addition, strong growth in our insurance business, a lower charge in the ECL provision in 2024 and the

impact of updates to actuarial methods and assumptions in 2023 also contributed to higher core earnings. These

increases were partially offset by a charge related to GMT, lower expected investment earnings, higher workforce-

related costs, including higher performance-related costs, and lower gains from updates to provisions for estimated

losses in our Property & Casualty Reinsurance business compared with prior year. In addition, year-to-date core

earnings reflected adverse net insurance experience in the U.S., partially offset by improved experience in Asia.

The GA Reinsurance Transaction reduced year-to-date core earnings by $64 million in 2024 compared with 2023,

attributable to the impact on expected earnings on insurance contracts, expected investment earnings, the change

in ECL, and insurance experience. The RGA Reinsurance Transaction reduced year-to-date core earnings by $1

million in 2024 compared with 2023.

Core earnings by segment is presented in the table below.


Core earnings by segment	Quarterly Results			YTD Results
($ millions, unaudited)	3Q24	2Q24	3Q23	2024	2023
Asia	$619	$647	$522	$1,923	$1,484
Canada	412	402	408	1,178	1,135
U.S.	411	415	442	1,278	1,285
Global Wealth and Asset Management	499	399	361	1,255	968
Corporate and Other	(113)	(126)	10	(315)	39
Total core earnings	$1,828	$1,737	$1,743	$5,319	$4,911


Manulife Financial Corporation – Third Quarter 2024		9

The table below presents net income attributed to shareholders consisting of core earnings and items excluded

from core earnings.


	Quarterly Results			YTD Results
($ millions, unaudited)	3Q24	2Q24	3Q23	2024	2023
Core earnings	$1,828	$1,737	$1,743	$5,319	$4,911
Items excluded from core earnings:
Market experience gains (losses)(1)	186	(665)	(1,022)	(1,258)	(1,657)
Realized gains (losses) on debt instruments	101	(350)	(24)	(919)	(79)
Derivatives and hedge accounting ineffectiveness	(9)	143	(266)	92	(186)
Actual less expected long-term returns on public equity	198	11	(273)	425	(79)
Actual less expected long-term returns on ALDA	(167)	(450)	(400)	(872)	(1,242)
Other investment results	63	(19)	(59)	16	(71)
Changes in actuarial methods and assumptions that flow directly through income(2)	(199)	-	(14)	(199)	(14)
Restructuring charge(3)	(20)	-	-	(20)	-
Reinsurance transactions, tax-related items and other(4)	44	(30)	306	(95)	204
Total items excluded from core earnings	11	(695)	(730)	(1,572)	(1,467)
Net income (loss) attributed to shareholders	$1,839	$1,042	$1,013	$3,747	$3,444
(1)Market experience was a net gain of $186 million in 3Q24, driven by higher-than-expected returns on public equity, net realized gains from the sale of debt instruments which are classified as FVOCI and favourable foreign exchange impacts. These were partially offset by lower-than-expected returns on ALDA mainly related to real estate, and a modest loss from derivatives and hedge accounting ineffectiveness. Market experience was a net charge of $1,022 million in 3Q23, primarily driven by lower-than-expected returns on ALDA mainly related to real estate, lower-than-expected returns on public equity, a charge from derivatives and hedge accounting ineffectiveness, net realized losses from the sale of debt instruments which are classified as FVOCI and a charge in other investment results. (2)Refer to section D2 “Actuarial methods and assumptions” below for detail. (3)In 3Q24, we reported a restructuring charge of $20 million post-tax ($25 million pre-tax) in Global WAM. (4)The 3Q24 net gain of $44 million mainly included tax related benefits and true-ups of $69 million and a charge of $28 million related to Global Minimum Taxes (“GMT”) (an additional $61 million charge was recorded in core earnings). The 3Q23 net gain of $306 million included a one-time tax-related benefit of $290 million, additional tax-related true-ups of $11 million and a gain of $5 million related to a reinsurance transaction in Vietnam.

Net income attributed to shareholders by segment is presented in the following table.


Net income (loss) attributed to shareholders by segment	Quarterly Results			YTD Results
($ millions, unaudited)	3Q24	2Q24	3Q23	2024	2023
Asia	$827	$582	$84	$1,772	$733
Canada	430	79	290	782	826
U.S.	5	135	72	32	441
Global Wealth and Asset Management	498	350	318	1,213	932
Corporate and Other	79	(104)	249	(52)	512
Total net income attributed to shareholders	$1,839	$1,042	$1,013	$3,747	$3,444

Expense efficiency ratio

The expense efficiency ratio is a financial measure which we use to measure progress on our strategic priority of

expense efficiency and reflects expenses that flow directly through core earnings (“core expenses”). Core

expenses include core general expenses, directly attributable maintenance expenses and directly attributable

acquisition expenses for products measured using the premium allocation approach (“PAA”) and for other products

without a CSM. Core expenses exclude certain expenses directly attributable to acquiring new business that are

capitalized into the CSM instead of flowing directly through core earnings.

Our focus on expense efficiency has enabled us to drive the benefits of scale across our businesses. We believe

there are further opportunities to leverage our global scale and operating environment, streamline processes and

further digitize our business. As a result, in the second quarter of 2024 (“2Q24”) we updated our medium-term

target for the expense efficiency ratio from less than 50% to less than 45%.

1 This is a non-GAAP financial measure. See “Non-GAAP and other financial measures” below for more information.


Manulife Financial Corporation – Third Quarter 2024		10

Quarterly expense efficiency ratio

The expense efficiency ratio was 44.4% in 3Q24, compared with 44.3% in 3Q23. The 0.1 percentage point

increase in the ratio compared with 3Q23 reflects a 4% increase in pre-tax core earnings1, and a 5% increase in

core expenses. The increase in core expenses was driven by higher workforce-related costs, including higher

performance-related costs, and the inclusion of ongoing operating expenses related to our acquisition of the CQS

business.

Total 3Q24 general expenses increased 16% on an actual exchange rate basis and 15% on a constant exchange

rate basis compared with 3Q23, driven by the items noted above related to the growth in core expenses, as well as

a reclassification of expenses from directly attributable maintenance to general expenses, and a restructuring

charge in Global WAM. General expenses excluded from core earnings in 3Q24 were mainly related to the above-

noted restructuring charge in Global WAM.

Year-to-date expense efficiency ratio

The year-to-date expense efficiency ratio was 45.0% in 2024, compared with 45.5% in the same period of 2023.

The 0.5 percentage point improvement in the year-to-date ratio compared with the same period of 2023 reflects an

8% increase in year-to-date pre-tax core earnings, and a 6% increase in year-to-date core expenses. The increase

in year-to-date core expenses was driven by similar items noted above related to the increase in core expenses in

3Q24.

Total year-to-date general expenses in 2024 increased 12% on an actual and constant exchange rate basis

compared with the same period of 2023 driven by the similar items noted above related to the increase in general

expenses in 3Q24. Year-to-date general expenses excluded from core earnings were mainly related to the

acquisition of CQS and a restructuring charge in Global WAM in 2024, and consisted primarily of a true-up of an

existing legal provision in 2023.

1 Percentage growth / declines in APE sales and NBV are stated on a constant exchange rate basis.

2 For more information on this metric, see “Non-GAAP and other financial measures” below.


Manulife Financial Corporation – Third Quarter 2024		11

A2Business performance


	Quarterly Results			YTD Results
($ millions, unless otherwise stated) (unaudited)	3Q24	2Q24	3Q23	2024	2023
Asia APE sales	$1,872	$1,259	$1,120	$4,412	$3,474
Canada APE sales	343	520	431	1,313	1,046
U.S. APE sales	132	128	106	412	370
Total APE sales(1)	2,347	1,907	1,657	6,137	4,890
Asia new business value	655	506	414	1,624	1,210
Canada new business value	143	159	153	459	351
U.S. new business value	45	58	33	152	133
Total new business value(1)	843	723	600	2,235	1,694
Asia new business CSM(2)	593	478	402	1,562	1,135
Canada new business CSM	95	76	51	241	154
U.S. new business CSM	71	74	54	242	252
Total new business CSM(2)	759	628	507	2,045	1,541
Asia CSM net of NCI	14,715	13,456	10,030	14,715	10,030
Canada CSM	4,036	3,769	3,662	4,036	3,662
U.S. CSM	2,171	3,522	3,651	2,171	3,651
Corporate and Other CSM	8	11	26	8	26
Total CSM net of NCI	20,930	20,758	17,369	20,930	17,369
Post-tax CSM net of NCI(3)	18,595	18,290	14,992	18,595	14,992
Global WAM gross flows ($ billions)(1)	41.3	41.4	34.3	128.2	108.2
Global WAM net flows ($ billions)(1)	5.2	0.1	(0.8)	12.0	5.8
Global WAM assets under management and administration ($ billions)(3)	990.9	943.9	806.7	990.9	806.7
Global WAM total invested assets ($ billions)	9.5	9.0	6.7	9.5	6.7
Global WAM segregated funds net assets ($ billions)	282.0	270.1	233.9	282.0	233.9
Total assets under management and administration ($ billions)(3),(4)	1,551.5	1,481.5	1,321.7	1,551.5	1,321.7
Total invested assets ($ billions)(4)	429.2	410.6	398.7	429.2	398.7
Segregated funds net assets ($ billions)(4)	423.0	406.1	356.9	423.0	356.9
(1) For more information on this metric, see “Non-GAAP and other financial measures” below. (2) New business CSM is net of NCI. (3) This item is a non-GAAP financial measure. See “Non-GAAP and other financial measures” below for more information. (4) See section A4 below for more information.

Annualized premium equivalent (“APE”) sales were $2,347 million in 3Q24, an increase of 40%1 compared with

3Q23, new business CSM was $759 million in 3Q24, an increase of 47% compared with 3Q23 and new

business value (“NBV”) was $843 million in 3Q24, an increase of 39%1 compared with 3Q23. New business

results by segment were as follows:

•Asia led with broad-based growth, generating 64%, 45% and 55%, growth compared with 3Q23 in APE

sales, new business CSM and NBV, respectively, reflecting higher sales volumes in Hong Kong, mainland

China, Singapore and Japan. New business value margin2 (“NBV margin”) remained resilient at 38.8%.

•Canada delivered solid new business results; higher sales in participating life insurance and Group

Insurance were more than offset by the non-recurrence of a large affinity market sale in 3Q23. APE sales

and NBV were down 20% and 7%, respectively, compared with 3Q23, while new business CSM increased

86%, compared with 3Q23 due to strong individual insurance and segregated fund sales.

•U.S. delivered double-digit growth in APE sales, new business CSM and NBV of 23%, 30% and 36%,

respectively, compared with 3Q23, reflecting a rebound in demand from affluent customers for

accumulation insurance products.


Manulife Financial Corporation – Third Quarter 2024		12

Year-to-date APE sales were $6,137 million in 2024, an increase of 26% compared with the same period of 2023,

year-to-date new business CSM was $2,045 million in 2024, an increase of 33% compared with the same period

of 2023 and year-to-date NBV was $2,235 million in 2024, an increase of 32% compared with the same period of

2023. New business results by segment were as follows:

•Asia year-to-date APE sales increased 28% compared with 2023, driven by growth in Hong Kong,

mainland China, Japan and Singapore. Business mix and the impact of updates to actuarial methods and

assumptions in the second half of 2023 further contributed to a 38% increase in year-to-date new business

CSM compared with 2023. Year-to-date NBV increased 35% compared with 2023 due to higher sales

volumes and business mix.

•Canada generated 26% growth in year-to-date APE sales compared with 2023, driven by higher large-

case sales in Group Insurance, along with higher participating life insurance and segregated fund sales,

partially offset by the non-recurrence of a large affinity markets sale in 3Q23. Combined with favourable

product mix, year-to-date NBV increased 31% compared with 2023. New business CSM increased 56%

compared with 2023 driven by favourable product mix in Individual Insurance and higher sales volumes in

segregated fund and Individual Insurance products.

•U.S. year-to-date APE sales increased 10% compared with 2023, reflecting increased demand from

affluent customers for accumulation insurance products, partially offset by lower sales of protection

insurance products. Combined with product mix, this led to a 13% increase in year-to-date NBV,

compared with 2023. Year-to-date new business CSM decreased 5% compared with 2023, primarily

driven by product mix and the impact of interest rates partially offset by higher sales volumes.

CSM net of NCI was $20,930 million as at September 30, 2024, an increase of $490 million compared with

December 31, 2023. Organic CSM movement was $724 million for the nine months ended September 30, 2024,

primarily driven by the impact of new business and interest accretion, partially offset by amortization recognized in

core earnings and adverse insurance experience. Inorganic CSM movement was $(234) million for the nine

months ended September 30, 2024, primarily driven by the impact of reinsurance transactions, and the annual

review of actuarial methods and assumptions that adjust the CSM, partially offset by favourable impacts of

changes in foreign currency exchange rates and equity market performance.

Global WAM reported net inflows were $5.2 billion in 3Q24 compared with net outflows of $0.8 billion in 3Q23.

By business line, the results were:

•Retirement net inflows were $0.6 billion in 3Q24 compared with net outflows of $3.4 billion in 3Q23,

primarily driven by the non-recurrence of a large-case retirement plan redemption in the U.S in 3Q23.

•Retail net inflows were $3.9 billion in 3Q24 compared with net outflows of $0.2 billion in 3Q23, due to

increased demand for investment products amid an equity market recovery and improved investor

sentiment, as well as the onboarding of several new advisors in Canada wealth.

•Institutional Asset Management net inflows were $0.7 billion in 3Q24 compared with net inflows of $2.8

billion in 3Q23, reflecting higher redemptions in fixed income mandates.

Year-to-date net inflows were $12.0 billion in 2024, compared with $5.8 billion in the same period of 2023. The

increase was primarily due to higher retail net inflows from increased demand for investment products. Retirement

net inflows increased driven by the non-recurrence of a large-case retirement plan redemption as mentioned

above and higher retirement plan sales partially offset by higher member withdrawals. Institutional net inflows

decreased due to higher fixed income redemptions.

1 The net issuance of subordinated debt consists of the issuance of $1.1 billion of subordinated debt in the first quarter of 2024 (“1Q24”) and $0.5 billion of

subordinated debt in 2Q24, partially offset by the redemption of $0.6 billion of JHUSA Surplus Notes in 1Q24 and $0.75 billion of subordinated debt in 3Q24.

2 This item is a non-GAAP financial measure. See “Non-GAAP and other financial measures” below for more information.

3 Includes cash & cash equivalents, comprised of cash on deposit, Canadian and U.S. Treasury Bills and high quality short-term investments, and marketable

assets, comprised of investment grade government and agency bonds, investment grade corporate bonds, investment grade securitized instruments, publicly

traded common stocks and preferred shares. Included in this balance is $11.9 billion encumbered cash and cash equivalents and marketable securities as at

September 30, 2024 (December 31, 2023 – $11.0 billion).

4 See “Caution regarding forward-looking statements” below.


Manulife Financial Corporation – Third Quarter 2024		13

A3Financial strength


	Quarterly Results			YTD Results
(unaudited)	3Q24	2Q24	3Q23	2024	2023
MLI’s LICAT ratio(1)	137%	139%	137%	137%	137%
Financial leverage ratio(2)	23.5%	24.6%	25.2%	23.5%	25.2%
Consolidated capital ($ billions)(3)	$78.3	$77.6	$71.4	$78.3	$71.4
Book value per common share ($)	$24.40	$23.71	$22.42	$24.40	$22.42
Adjusted book value per common share ($)(2)	$34.97	$33.96	$30.67	$34.97	$30.67
(1)This item is disclosed under the Office of the Superintendent of Financial Institutions’ (“OSFI”) Life Insurance Capital Adequacy Test Public Disclosure Requirements guideline. (2)This item is a non-GAAP ratio. See “Non-GAAP and other financial measures” below for more information. (3)This item is a capital management measure. For more information on this metric, see “Non-GAAP and other financial measures” below.

The Life Insurance Capital Adequacy Test (“LICAT”) ratio for The Manufacturers Life Insurance Company

(“MLI”) as at September 30, 2024 was 137% compared with 139% as at June 30, 2024. The two percentage point

decrease was mainly driven by common share buybacks and the redemption of subordinated debt. MFC’s LICAT

ratio was 125% as at September 30, 2024 compared with 127% as at June 30, 2024, with the decrease driven by

similar factors that impacted the movement in MLI’s LICAT ratio. The difference between the MLI and MFC ratios

as at September 30, 2024 was largely due to the $6.2 billion of MFC senior debt outstanding that does not qualify

as available capital for MFC but, based on the form it was down-streamed, qualifies as regulatory capital for MLI.

MFC’s financial leverage ratio as at September 30, 2024 was 23.5%, a decrease of 1.1 percentage points from

24.6% as at June 30, 2024. The decrease in the ratio was driven by the redemption of capital instruments1 during

the quarter, an increase in total equity, and higher post-tax CSM2. The increase in total equity was mainly from total

comprehensive income, which was partially offset by dividends and common share buybacks.

MFC’s consolidated capital was $78.3 billion as at September 30, 2024, an increase of $4.4 billion compared

with $73.9 billion as at December 31, 2023. The increase was driven by growth in total equity, higher post-tax

CSM, and a net issuance of capital instruments1. The growth in total equity was from year-to-date total

comprehensive income, which was partially offset by dividends and common share buybacks.

Cash and cash equivalents and marketable securities3 was $254.5 billion as at September 30, 2024 compared

with $250.7 billion as at December 31, 2023. The increase was primarily driven by higher market value of debt

instruments due to lower interest rates, favourable changes in foreign exchange rates and higher equity markets,

mostly offset by the impact of the GA and RGA Reinsurance Transaction.

Book value per common share as at September 30, 2024 was $24.40, a 9% increase compared with $22.36 as

at December 31, 2023. The number of common shares outstanding was 1,759 million as at September 30, 2024, a

net decrease of 47 million common shares from 1,806 million as at December 31, 2023, primarily driven by

common share buybacks. We’ve purchased for cancellation 51 million common shares as of September 30, 2024,

and plan to purchase the maximum 90 million common shares approved for purchase under our current amended

normal course issuer bid which runs until February 25, 2025.4

Adjusted book value per common share as at September 30, 2024 was $34.97, a 9% increase compared with

$32.19 as at December 31, 2023 driven by an increase in the adjusted book value2 and a lower number of

common shares outstanding. Adjusted book value increased $3.4 billion due to growth in total common

shareholders’ equity and an increase in post-tax CSM, net of NCI. The increase in common shareholders’ equity

reflects the impact of growth in total comprehensive income, partially offset by dividends and common share

buybacks.

1 Manulife Pro is available in Singapore, Vietnam, Indonesia, Japan and Hong Kong.

2 Net promoter score (“NPS”).

3 Compared with registration in May 2024, prior to the soft launch of the app in June 2024.


Manulife Financial Corporation – Third Quarter 2024		14

A4Assets under management and administration (“AUMA”)

AUMA as at September 30, 2024 was $1.6 trillion, an increase of 10% compared with December 31, 2023,

primarily due to the favourable impact of interest rates and equity markets, and net inflows. Total invested assets

increased 3% on an actual exchange rate basis, primarily due to the impact of interest rates on debt instruments

and equity markets, partially offset by the transfer of invested assets related to the GA and RGA Reinsurance

Transactions. Segregated funds net assets increased 12% on an actual exchange rate basis, primarily due to the

impact of equity markets.

A5 Impact of foreign currency exchange rates

Changes in foreign currency exchange rates from 3Q23 to 3Q24 increased core earnings by $20 million in 3Q24,

primarily due to a weaker Canadian dollar compared with the U.S. dollar. Changes in foreign currency exchange

rates decreased year-to-date core earnings by $4 million in 2024 compared with the same period of 2023 primarily

due to a stronger Canadian dollar compared with the Japanese yen. The impact of foreign currency exchange

rates on items excluded from core earnings does not provide relevant information given the nature of those items.

A6 Business highlights