Manulife Financial Corporation

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Manulife Financial Corporation

200 Bloor Street East, North Tower 11
Toronto, Ontario M4W 1E5
Telephone: (416) 926-3000
Toll Free: (800) 795-9767
Fax: (416) 926-5410
Web site:

Public Company
Incorporated: 1887 as The Manufacturers Life Insurance Company
Employees: 20,000
Total Assets: CAD 344.43 billion ($295.52 billion) (2005)
Stock Exchanges: Toronto New York Hong Kong Philippines
Ticker Symbol: MFC
NAIC: 524113 Direct Life Insurance Carriers; 551111 Offices of Bank Holding Companies

Manulife Financial Corporation ranks among the largest insurance companies in the world. Establishing foreign operations early in its history, Manulife serves customers in the United States and Asia, as well as in its home country of Canada. The 2004 merger with U.S.-based John Hancock Financial Services allowed the insurer to compete toe to toe with the world's toughest competitors.


Manulife Financial dates back to late 19th-century Canada. The Manufacturers Life Insurance Company was incorporated by an Act of Parliament in 1887 with the country's first prime minister serving as president, according to the company's web site history. During its first decade of operation, the insurer led all Canadian companies in terms of growth, exceeding $1.2 million in assets by 1896. Its early years of operation were also marked by entry into foreign markets, including Bermuda, China, and Hong Kong. The company began selling basic life insurance in the United States in 1903, at first out of Detroit, Michigan; geographic and product expansion followed.

By 1918, the company's total insurance in force reached $100 million, doubling the amount of about a decade earlier. Midway into the 1920s, Manulife designated Toronto, Ontario, as home to its head office.

World War II pulled several hundred employees into battle, and business in many of the company's Asian markets ground to a halt. Manulife resumed its solid growth in the postwar years: total business in force climbed from $1 billion to $3 billion between 1947 and 1959. During the 1960s the company moved into mutualization, coming under the private ownership of its policyholders. By the end of the 1970s total company assets topped $5 billion. A lively period of acquisitions followed, driving growth in the United States and Canada. The company also entered into joint ventures in Singapore and Indonesia during the 1980s.

Thomas Di Giacomo replaced Sydney Jackson as CEO in February 1987. Jackson continued as chairman of Manulife. Under Jackson, the company's assets grew from $2.2 billion in the early 1970s to $19.1 billion in 1986. The acquisition-driven growth, however, failed to move the company past Sun Life Assurance Co. of Canada into position as the country's largest insurer. Sun Life's 1986 assets of $19.25 billion were just slightly ahead of Manulife's. Yet it well outpaced its rival in terms of revenue, $5.5 billion versus Manulife's $4.5 billion. Manulife's premium income had climbed only 4 percent.

Under Di Giacomo, Manulife looked to broader measures of success. A jump of 17 percent, during 1986, had already helped Manulife surpass Sun Life in terms of net profits, $208 million to $184 million, respectively. "Sales volume can no longer be the sole driving force," Di Giacomo told the National Post. "We must be oriented toward profitable sales growth. We will not sell products whose margins are so low they will draw on our strong surplus position."

Increased crossover in the financial services industry had pared down margins and depressed rates. Moreover, insurers saw increased product development costs as they tried to keep pace with the rapidly changing marketplace. Manulife had yet to fully realize the savings expected from its 1984 purchase of Dominion Life Assurance of Canada, according to the Toronto Star.


The 1990s started out with a name change. Manulife Financial reflected the company's growing product diversification. In 1993, Manulife opened a bank, a first among Canadian insurers. Another industry first was registered in 1996, when the life insurer passed the CAD 500 million mark in earnings.

The company demutualized in 1999. Manulife Financial Corporation began trading on the Toronto Stock Exchange, the New York Stock Exchange, and in Asia. In 2000, Manulife topped CAD 1 billion in net income. When measured by market valuation, the company was among the largest financial institutions in Canada.

As the new century began, the Canadian Parliament was working through the details of financial services legislation. The act would affect eight other financial laws, including the Bank Act and the Insurance Companies Act, Alan Toulin reported for the National Post. The proposed law enabled banks and insurers to form holding companies which in turn could own a range of operating subsidiaries; one delay in the passage of the legislation related to the taxation of those subsidiary companies. Additionally, the percentage of ownership allowed by a group or individual would increase from 10 to 20 percent.

An aspect of the legislation pertaining particularly to Manulife was a policy declaration protecting it, and Sun Life, from acquisition during a two-year period. Concerns over a rising tide of merger and acquisition activity in the wake of the legislation prompted the action. While the House of Commons and the Senate were poised to create new opportunities in the financial services sector, new regulatory and oversight rules were also pending. The insurance industry, regulated at the provincial level, had balked at creation of a new independent ombudsman office. Some of the country's largest insurers had switched from policyholder ownership to stock companies in anticipation of the new financial services industry climate.

In the years that followed, Canadian financial services companies began turning increasingly to the United States to drive growth. "If you look at the size of the Canadian economy and the Canadian population, it's clear that to achieve your goals you have to be present in markets other than your own," Manulife's CEO Dominic D'Alessandro told the New York Times in 2003. The Canadian government's prohibition on the country's banks merging among themselves had set off a buying spree: about CAD 13 billion on U.S. acquisitions since 1996.


As for Manulife, it was poised to acquire John Hancock Financial Services for $11 billion in stock. The resulting company, managing $246 billion in assets, would be the second biggest company on the Toronto Stock Exchange, when measured by market value.

Manulife's key competitor, Sun Life, controlled Boston-based mutual fund distributor MFS Investment Management and had paid $2.6 billion in 2001 for Keyport Life, a Boston-based annuities specialist. Thirty-four percent of Manulife's 2002 earnings came from American operations, according to the New York Times.


Manulife Financial's vision is to be the most professional life insurance company in the world: providing the very best financial protection and investment management services tailored to customers in every market where we do business.

The John Hancock deal brought Manulife a widely recognizable brand name, a greater product range, and a stronger sales force. The combined company rose among the ranks of the major players in the industry, allowing it to compete head to head against giants MetLife and Prudential Financial.

Initially, Dominic D'Alessandro would serve as both president and CEO of the combined company, headquartered in Toronto. John Hancock's CEO David D'Alessandrothe two leaders shared a common name but were not relatedwas slated to head the Boston-based North American operations and eventually move into position as president of the combined companies. Manulife USA would become a John Hancock unit. Hancock's Maritime Life subsidiary would go under Manulife's Canadian operation.

The market value of the new company was nearly $26 billion, ranking it as the second largest life insurance company in North America following the American International Group, Inc., based in New York. Combined total net income in 2002 was $1.4 billion, 67 percent from North American operations. In terms of U.S. individual life insurance sales, the new company climbed to the number four slot. Hancock had ranked eighth and Manulife 16th in 2002.

The amalgamation of the two companies was completed in April 2004. David D'Alessandro stepped down as president and CEO of John Hancock in November and was succeeded by John D. DesPrez III.

An epidemic of wrongdoing marred the corporate world during the early 2000s. A referral relationship with fraud-ridden Portus Alternative Management Inc. threatened Manulife's reputation. "But not for long. Manulife CEO Dominic D'Alessandro quickly steered the company onto the high road, publicly assuring clients that any money they had with Portus would be coveredsomething competitors have yet to do. Within days, he took Manulife from being branded 'possible accomplice' and repositioned it as 'outraged victim.' Crisis averted, it seems. Just another feather in D'Alessandro's cap during his remarkable tenure at Manulife, a company that under his leadership has rapidly become one of Canada's foremost contributors to global business," reported Canadian Business in the spring of 2005.

Manulife was among three corporations controlling 65 percent of the assets in Canada's life insurance industry. Manulife, Sun Life Assurance Company of Canada, and GreatWest also collected about 60 percent of the premiums according to a November 2005 Best's Review article. The trio rose to dominance as the industry consolidated. The small Canadian insurers concentrated their efforts in niche markets, which rewarded fast-paced innovation and were less regulated than in the United States.

Already benefiting from broad product offerings and sweeping distribution systems, D'Alessandro was an advocate of some regulatory changes that could create even larger networks. He was an advocate of loosening restrictions on mergers within the Canadian financial industry.

"I don't want you to conclude that somehow I'm lusting after acquiring a bank or merging with a bankthat's not the case at all. I'm just saying that, perhaps, that ought to be a possibility that should be available," D'Alessandro told the Globe and Mail in June 2006.

While future possibilities remained in the hands of lawmakers in its homeland, Manulife envisioned revenue growth from its Asian concerns on a more immediate basis. The company had been regularly opening new branches in China and planned continued expansion. Manulife had also established itself in the Vietnamese market, which had a growing middle class.


The Manufacturers Life Insurance Company is incorporated.
First policy is sold outside of Canada.
Operations expand into Asia.
Company enters U.S. insurance market.
Total amount of insurance in force hits $100 million.
Toronto is designated as headquarters.
One millionth policy is sold.
Shareholders vote for mutualization.
Manulife is introduced as corporate wordmark.
Total insurance in force reaches $100 billion.
Manulife becomes first Canadian insurance company to open a bank.
Demutualized, Manulife begins trading on public market.
Merger with John Hancock creates fifth largest insurance company worldwide.

If the first half-decade of the century held true for the later, Manulife shareholders would continue to see gains. The company had outperformed the S&P/TSX Composite Index and the S&P/TSX Composite Financials Index in total cumulative shareholder return, assuming the reinvestment of all dividends, since the end of 1999.

Kathleen Peippo


John Hancock Holdings LLC; The Manufacturers Life Insurance Company.


American International Group Inc.; Power Financial Corporation; Sun Life Financial Inc.


"Chief of Manulife's John Hancock Unit Is Retiring," New York Times, June 11, 2004.

Daw, James, "Manulife's New Chief Aims to Avoid 'Irrational Pricing,'" Toronto Star, February 20, 1987, p. E3.

Panko, Ron, "Game's On: Canada's Life Insurance Market Is Dominated by Three Big Corporations, but Smaller Insurers Find Ways to Compete," Best's Review, November 2005, pp. 60+.

Sanford, Jeff, and John Gray, "Top CFO 2005: Laurence Sellyn, Gildan Activewear Inc.," Canadian Business, April 25May 8, 2005.

Simon, Bernard, "Deal to Acquire U.S. Insurer Is Part of a Canadian Trend," New York Times, September 30, 2003, p. C12.

Thomas, Trevor, "The Manulife-Hancock MergerStart of Something Big?" National Underwriter Life & HealthFinancial Services Edition, October 6, 2003, pp. 48+.

Toulin, Alan, "Ottawa Planning to Single Out Two Big Insurers: Manulife, Sun Life," National Post, March 6, 2000. C1.

Trichur, Rita, "Manulife Chief Sees China As Next Frontier," Globe and Mail, June 14, 2006, p. B5.

Waxer, Cindy, "Manulife Taps Vietnamese Insurance Market," Canadian Business Online, June 619, 2005.

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