Genworth Financial Inc (GNW)’s Risk-Based Capital Ratio Falls to 430% In 4Q

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Genworth Financial Inc (NYSE:GNW) said that its risk-based capital ratio in its life insurance segment witnessed a fall to about 430% in the fourth quarter from approximately 445% in the third quarter. The company’s President and CEO, Tom McInerney, said that Long Term Care continued to be challenging. The company was planning to capitalize on its leadership position to fuel regulatory changes to sustain the business in the long-term.

Genworth Financial Inc (NYSE:GNW) CEO expressed his disappointment over the continuous challenges in its older LTC blocks, which overshadows its strong results and momentum in other units. He said that the company undertook a thorough review of its portfolio and explored every option to maximize shareholder value on a long-term basis. It has also decided to leverage its strengths in the Global Mortgage Insurance segment and rationalize its portfolio.

4Q Results

The company suffered a net loss of $760 million or a loss of $1.53 a share in the fourth quarter compared to a profit of $208 million or 41 cents a share in the year-ago quarter. Genworth’s operating loss was $416 million or a loss of 84 cents a share versus net operating income of $193 million or 38 cents a share in the prior year quarter. Street analysts’ were predicting a loss of 13 cents a share.

Top line of Genworth Financial Inc (NYSE:GNW) remained flat at $2.42 billion in the fourth quarter. Analysts estimated $2.41 billion revenue. Its premium revenue advanced 5.8% to $1.39 billion while net investment income fell 2% to $819 million in the December quarter.

The company believes that long term care remained a priority with the need for structural, as well as, regulatory reform. Its cash, cash equivalents, and invested assets were worth $78.84 billion at the end of the quarter.

Full Year Results

Genworth Financial Inc (NYSE:GNW) suffered a net loss of $1.24 billion or a loss of $2.51 a share versus net profit of $560 million or $1.12 a share in the previous year. Its net operating loss was $381 million or a loss of 77 cents a share compared to net operating income of $616 million or $1.24 a share in the prior year. Total revenue for the year 2014 grew 1.7% to $9.565 billion from $9.40 billion in the previous year.

Viraj Shah

Viraj Shah has completed M.Com (Finance) and is currently pursuing his CFP. He tracks US markets along with other global markets like India very closely. He is very passionate about stocks, real estate, and technology. He also believes that money can always be made in the market.

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