Exhibit 99.2
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i
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Cautionary Note Regarding Forward-Looking Statements
This financial supplement contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as expects, intends, anticipates, plans, believes, seeks, estimates, will or words of similar meaning and include, but are not limited to, statements regarding the outlook for future business and financial performance of Genworth Financial, Inc. and its consolidated subsidiaries. Forward-looking statements are based on managements current expectations and assumptions, which are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Actual outcomes and results may differ materially from those in the forward-looking statements due to global political, economic, inflation, business, competitive, market, regulatory and other factors and risks, including but not limited to, risks discussed in the risk factor section of the companys Annual Report on Form 10-K, filed with the United States Securities and Exchange Commission on February 28, 2023. Therefore, the company cautions you against relying on any forward-looking statements. The company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required under applicable securities laws.
ii
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Table of Contents |
Page | |||
3 | ||||
4 | ||||
Results of Operations and Selected Operating Performance Measures |
5 | |||
6 | ||||
Consolidated Quarterly Results |
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8 | ||||
Reconciliation of Net Income (Loss) to Adjusted Operating Income (Loss) |
9 | |||
10-11 | ||||
12-13 | ||||
Quarterly Results by Business |
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15-20 | ||||
22-23 | ||||
25-28 | ||||
30 | ||||
Additional Financial Data |
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32 | ||||
33 | ||||
34 | ||||
35 | ||||
Reconciliations of Non-GAAP Measures |
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37 | ||||
38 | ||||
39 |
Note:
Unless otherwise stated, all references in this financial supplement to income (loss) from continuing operations, income (loss) from continuing operations per share, net income (loss), net income (loss) per share, adjusted operating income (loss), adjusted operating income (loss) per share, book value and book value per share should be read as income (loss) from continuing operations available to Genworth Financial, Inc.s common stockholders, income (loss) from continuing operations available to Genworth Financial, Inc.s common stockholders per share, net income (loss) available to Genworth Financial, Inc.s common stockholders, net income (loss) available to Genworth Financial, Inc.s common stockholders per share, non-U.S. Generally Accepted Accounting Principles (U.S. GAAP) adjusted operating income (loss) available to Genworth Financial, Inc.s common stockholders, non-GAAP adjusted operating income (loss) available to Genworth Financial, Inc.s common stockholders per share, book value available to Genworth Financial, Inc.s common stockholders and book value available to Genworth Financial, Inc.s common stockholders per share, respectively.
2
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Thank you for your continued interest in Genworth Financial, Inc.
All information included herein is currently unaudited. It is possible that the final audited financial results may differ, perhaps materially, from the information included in this financial supplement. In addition, the unaudited financial results reported in this financial supplement are not indicative of future financial results, although as the company has indicated, it does expect the quarterly volatility of results, particularly in its Long-Term Care Insurance and Life and Annuities segments, to extend to future periods.
In the fourth quarter of 2023, the company completed its annual assumption review in its long-term care insurance and life insurance businesses. Additional information on these updates is included on pages 22 and 26.
Please see the accompanying press release posted to the companys website at http://investor.genworth.com for additional information regarding its fourth quarter 2023 results.
Investors are encouraged to listen to the companys earnings call on the fourth quarter 2023 results at 9:00 a.m. (ET) on February 22, 2024.
Regards,
Brian Johnson, Investor Relations
InvestorInfo@genworth.com
3
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
This financial supplement includes the non-GAAP financial measures entitled adjusted operating income (loss) and adjusted operating income (loss) per share. Adjusted operating income (loss) per share is derived from adjusted operating income (loss). Management evaluates segment performance and allocates resources on the basis of adjusted operating income (loss). The company defines adjusted operating income (loss) as income (loss) from continuing operations excluding the after-tax effects of income (loss) from continuing operations attributable to noncontrolling interests, net investment gains (losses), changes in fair value of market risk benefits and associated hedges, gains (losses) on the sale of businesses, gains (losses) on the early extinguishment of debt, restructuring costs and infrequent or unusual non-operating items. A component of the companys net investment gains (losses) is the result of estimated future credit losses, the size and timing of which can vary significantly depending on market credit cycles. In addition, the size and timing of other investment gains (losses) can be subject to the companys discretion and are influenced by market opportunities, as well as asset-liability matching considerations. The company excludes net investment gains (losses), changes in fair value of market risk benefits and associated hedges, gains (losses) on the sale of businesses, gains (losses) on the early extinguishment of debt, restructuring costs and infrequent or unusual non-operating items from adjusted operating income (loss) because, in the companys opinion, they are not indicative of overall operating performance.
While some of these items may be significant components of net income (loss) available to Genworth Financial, Inc.s common stockholders in accordance with U.S. GAAP, the company believes that adjusted operating income (loss) and measures that are derived from or incorporate adjusted operating income (loss), including adjusted operating income (loss) per share on a basic and diluted basis, are appropriate measures that are useful to investors because they identify the income (loss) attributable to the ongoing operations of the business. Management also uses adjusted operating income (loss), among other key performance indicators, as a basis for determining awards and compensation for senior management and to evaluate performance on a basis comparable to that used by analysts. However, the items excluded from adjusted operating income (loss) have occurred in the past and could, and in some cases will, recur in the future. Adjusted operating income (loss) and adjusted operating income (loss) per share on a basic and diluted basis are not substitutes for net income (loss) available to Genworth Financial, Inc.s common stockholders or net income (loss) available to Genworth Financial, Inc.s common stockholders per share on a basic and diluted basis determined in accordance with U.S. GAAP. In addition, the companys definition of adjusted operating income (loss) may differ from the definitions used by other companies.
Adjustments to reconcile net income (loss) available to Genworth Financial, Inc.s common stockholders to adjusted operating income (loss) assume a 21% tax rate and are net of the portion attributable to noncontrolling interests. Changes in fair value of market risk benefits and associated hedges are adjusted to exclude changes in reserves, attributed fees and benefit payments.
In the third and fourth quarters of 2022, the company incurred $6 million and $2 million, respectively, of pre-tax pension plan termination costs related to one of its defined benefit pension plans. There were no other infrequent or unusual items excluded from adjusted operating income (loss) during the periods presented.
The table on page 9 of this financial supplement provides a reconciliation of net income (loss) available to Genworth Financial, Inc.s common stockholders to adjusted operating income (loss) for the periods presented and reflects adjusted operating income (loss) as determined in accordance with accounting guidance related to segment reporting. This financial supplement includes other non-GAAP measures management believes enhances the understanding and comparability of performance by highlighting underlying business activity and profitability drivers. These additional non-GAAP measures are on pages 37 to 39 of this financial supplement.
Statutory Accounting Data
The company presents certain supplemental statutory data for Genworth Life Insurance Company (GLIC) and its consolidating life insurance subsidiaries that has been prepared on the basis of statutory accounting principles (SAP). GLIC and its consolidating life insurance subsidiaries file financial statements with state insurance regulatory authorities and the National Association of Insurance Commissioners that are prepared using SAP, an accounting basis either prescribed or permitted by such authorities. Due to differences in methodology between SAP and U.S. GAAP, the values for assets, liabilities and equity, and the recognition of income and expenses, reflected in financial statements prepared in accordance with U.S. GAAP are materially different from those reflected in financial statements prepared under SAP. This supplemental statutory data should not be viewed as an alternative to, or used in lieu of, U.S. GAAP.
This supplemental statutory data includes the impact from in-force rate actions on pre-tax long-term care insurance statutory earnings. Statutory pre-tax earnings represent the net gain from operations, including the impact from in-force rate actions, before dividends to policyholders, refunds to members and federal income taxes and before realized capital gains or (losses). Management uses and provides this supplemental statutory data because it believes it provides a useful measure of, among other things, statutory pre-tax earnings and the adequacy of capital. Management uses this data to measure against its policy to manage the U.S. life insurance companies with internally generated capital.
4
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Results of Operations and Selected Operating Performance Measures
The company taxes its businesses at the U.S. corporate federal income tax rate of 21%. Each segment is then adjusted to reflect the unique tax attributes of that segment, such as permanent differences between U.S. GAAP and tax law. The difference between the consolidated provision for income taxes and the sum of the provision for income taxes in each segment is reflected in Corporate and Other.
The annually-determined tax rates and adjustments to each segments provision for income taxes are estimates which are subject to review and could change from year to year. U.S. GAAP generally requires an annualized effective tax rate to be used for interim reporting periods, utilizing projections of full year results. However, in certain circumstances it is appropriate to record the actual effective tax rate for the period if a reliable full year estimate cannot be made. For the three months ended March 31, 2023, June 30, 2023 and September 30, 2023, the company utilized the actual effective tax rate for the interim period to record the provision for income taxes for its Long-Term Care Insurance and Life and Annuities segments and the annualized projected effective tax rate for its Enact segment and Corporate and Other. The company utilized the effective tax rate for the year ended December 31, 2022 in determining the re-presented provision for income taxes for the quarters in 2022.
This financial supplement contains selected operating performance measures including sales and insurance in-force or risk in-force which are commonly used in the insurance industry as measures of operating performance.
Management regularly monitors and reports sales metrics as a measure of volume of new business generated in a period. Sales refer to new insurance written for mortgage insurance products included in the companys Enact segment. The company considers new insurance written to be a measure of the operating performance of its Enact segment because it represents a measure of new sales of insurance policies during a specified period, rather than a measure of revenues or profitability during that period.
Management regularly monitors and reports insurance in-force and risk in-force for the companys Enact segment. Insurance in-force is a measure of the aggregate unpaid principal balance as of the respective reporting date for loans insured by the companys U.S. mortgage insurance subsidiaries. Risk in-force is based on the coverage percentage applied to the estimated current outstanding loan balance. The company considers insurance in-force and risk in-force to be measures of the operating performance of its Enact segment because they represent measures of the size of its business at a specific date which will generate revenues and profits in a future period, rather than measures of its revenues or profitability during that period. These metrics are presented on a direct basis and exclude reinsurance.
Management also regularly monitors and reports a loss ratio for the companys Enact segment. The loss ratio is the ratio of benefits and other changes in policy reserves to net earned premiums. The company considers the loss ratio to be a measure of underwriting performance and helps to enhance the understanding of the operating performance of the Enact segment.
These operating performance measures enable the company to compare its operating performance across periods without regard to revenues or profitability related to policies or contracts sold in prior periods or from investments or other sources.
5
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
(amounts in millions, except per share data)
Balance Sheet Data |
December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
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Total Genworth Financial, Inc.s stockholders equity, excluding accumulated other comprehensive income (loss) |
$ | 10,035 | $ | 10,276 | $ | 10,321 | $ | 10,292 | $ | 10,245 | ||||||||||
Total accumulated other comprehensive income (loss)(1) |
(2,555 | ) | (2,220 | ) | (2,861 | ) | (2,853 | ) | (2,614 | ) | ||||||||||
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Total Genworth Financial, Inc.s stockholders equity |
$ | 7,480 | $ | 8,056 | $ | 7,460 | $ | 7,439 | $ | 7,631 | ||||||||||
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Book value per share |
$ | 16.74 | $ | 17.80 | $ | 15.98 | $ | 15.28 | $ | 15.40 | ||||||||||
Book value per share, excluding accumulated other comprehensive income (loss) |
$ | 22.46 | $ | 22.70 | $ | 22.11 | $ | 21.14 | $ | 20.68 | ||||||||||
Common shares outstanding as of the balance sheet date |
446.8 | 452.7 | 466.8 | 486.9 | 495.4 | |||||||||||||||
Three months ended | ||||||||||||||||||||
Quarterly Average ROE |
December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
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U.S. GAAP Basis ROE |
(8.4 | )% | 1.1 | % | 5.3 | % | 4.8 | % | 15.1 | % | ||||||||||
Operating ROE(2) |
(9.1 | )% | 1.6 | % | 3.3 | % | 5.6 | % | 13.4 | % | ||||||||||
Basic and Diluted Shares |
Three months ended December 31, 2023 |
Twelve months ended December 31, 2023 |
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Weighted-average common shares used in basic earnings per share calculations |
449.4 | 468.8 | ||||||||||||||||||
Potentially dilutive securities: |
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Performance stock units, restricted stock units and other equity-based awards |
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Weighted-average common shares used in diluted earnings per share calculations(3) |
449.4 | 474.9 | ||||||||||||||||||
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(1) | As of December 31, 2023, September 30, 2023, June 30, 2023, March 31, 2023 and December 31, 2022, total accumulated other comprehensive income (loss) includes $(1,439) million, $1,826 million, $(964) million, $(1,628) million and $(403) million, net of taxes, respectively, related to changes in the discount rate used to remeasure the liability for future policy benefits and related reinsurance recoverables. |
(2) | See page 37 herein for a reconciliation of U.S. GAAP Basis ROE to Operating ROE. |
(3) | Under applicable accounting guidance, companies in a loss position are required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share. Therefore, as a result of the loss from continuing operations for the three months ended December 31, 2023, the company was required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share for the three months ended December 31, 2023, as the inclusion of shares for performance stock units, restricted stock units and other equity-based awards of 6.3 million would have been antidilutive to the calculation. If the company had not incurred a loss from continuing operations for the three months ended December 31, 2023, dilutive potential weighted-average common shares outstanding would have been 455.7 million. |
6
Consolidated Quarterly Results
7
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Consolidated Net Income (Loss) by Quarter
(amounts in millions, except per share amounts)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
REVENUES: |
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Premiums |
$ | 904 | $ | 915 | $ | 902 | $ | 915 | $ | 3,636 | $ | 918 | $ | 929 | $ | 916 | $ | 917 | $ | 3,680 | ||||||||||||||||||||
Net investment income |
810 | 801 | 785 | 787 | 3,183 | 787 | 808 | 787 | 764 | 3,146 | ||||||||||||||||||||||||||||||
Net investment gains (losses) |
38 | (43 | ) | 39 | (11 | ) | 23 | (5 | ) | (58 | ) | 19 | 42 | (2 | ) | |||||||||||||||||||||||||
Policy fees and other income |
159 | 158 | 166 | 163 | 646 | 167 | 169 | 165 | 170 | 671 | ||||||||||||||||||||||||||||||
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Total revenues |
1,911 | 1,831 | 1,892 | 1,854 | 7,488 | 1,867 | 1,848 | 1,887 | 1,893 | 7,495 | ||||||||||||||||||||||||||||||
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BENEFITS AND EXPENSES: |
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Benefits and other changes in policy reserves |
1,233 | 1,199 | 1,175 | 1,176 | 4,783 | 1,209 | 1,159 | 768 | 1,167 | 4,303 | ||||||||||||||||||||||||||||||
Liability remeasurement (gains) losses |
416 | 116 | 70 | (15 | ) | 587 | (267 | ) | 17 | 24 | (64 | ) | (290 | ) | ||||||||||||||||||||||||||
Changes in fair value of market risk benefits and associated hedges |
14 | (24 | ) | (19 | ) | 17 | (12 | ) | (56 | ) | (27 | ) | 20 | (41 | ) | (104 | ) | |||||||||||||||||||||||
Interest credited |
124 | 127 | 126 | 126 | 503 | 125 | 128 | 126 | 125 | 504 | ||||||||||||||||||||||||||||||
Acquisition and operating expenses, net of deferrals |
248 | 228 | 226 | 240 | 942 | 225 | 245 | 579 | 236 | 1,285 | ||||||||||||||||||||||||||||||
Amortization of deferred acquisition costs and intangibles |
63 | 65 | 64 | 72 | 264 | 74 | 80 | 84 | 88 | 326 | ||||||||||||||||||||||||||||||
Interest expense |
30 | 30 | 29 | 29 | 118 | 28 | 26 | 26 | 26 | 106 | ||||||||||||||||||||||||||||||
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Total benefits and expenses |
2,128 | 1,741 | 1,671 | 1,645 | 7,185 | 1,338 | 1,628 | 1,627 | 1,537 | 6,130 | ||||||||||||||||||||||||||||||
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INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES |
(217 | ) | 90 | 221 | 209 | 303 | 529 | 220 | 260 | 356 | 1,365 | |||||||||||||||||||||||||||||
Provision (benefit) for income taxes |
(36 | ) | 30 | 55 | 55 | 104 | 119 | 54 | 62 | 84 | 319 | |||||||||||||||||||||||||||||
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INCOME (LOSS) FROM CONTINUING OPERATIONS |
(181 | ) | 60 | 166 | 154 | 199 | 410 | 166 | 198 | 272 | 1,046 | |||||||||||||||||||||||||||||
Net income (loss) from discontinued operations, net of taxes(1) |
(2 | ) | | 2 | | | (2 | ) | 5 | (1 | ) | (2 | ) | | ||||||||||||||||||||||||||
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NET INCOME (LOSS) |
(183 | ) | 60 | 168 | 154 | 199 | 408 | 171 | 197 | 270 | 1,046 | |||||||||||||||||||||||||||||
Less: net income from continuing operations attributable to noncontrolling interests |
29 | 31 | 31 | 32 | 123 | 27 | 35 | 38 | 30 | 130 | ||||||||||||||||||||||||||||||
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NET INCOME (LOSS) AVAILABLE TO GENWORTH FINANCIAL, INC.S COMMON STOCKHOLDERS |
$ | (212 | ) | $ | 29 | $ | 137 | $ | 122 | $ | 76 | $ | 381 | $ | 136 | $ | 159 | $ | 240 | $ | 916 | |||||||||||||||||||
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NET INCOME (LOSS) AVAILABLE TO GENWORTH FINANCIAL, INC.S COMMON STOCKHOLDERS: |
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Income (loss) from continuing operations available to Genworth Financial, Inc.s common stockholders |
$ | (210 | ) | $ | 29 | $ | 135 | $ | 122 | $ | 76 | $ | 383 | $ | 131 | $ | 160 | $ | 242 | $ | 916 | |||||||||||||||||||
Income (loss) from discontinued operations available to Genworth Financial, Inc.s common stockholders |
(2 | ) | | 2 | | | (2 | ) | 5 | (1 | ) | (2 | ) | | ||||||||||||||||||||||||||
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NET INCOME (LOSS) AVAILABLE TO GENWORTH FINANCIAL, INC.S COMMON STOCKHOLDERS |
$ | (212 | ) | $ | 29 | $ | 137 | $ | 122 | $ | 76 | $ | 381 | $ | 136 | $ | 159 | $ | 240 | $ | 916 | |||||||||||||||||||
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Earnings (Loss) Per Share Data: |
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Income (loss) from continuing operations available to Genworth Financial, Inc.s common stockholders per share |
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Basic |
$ | (0.47 | ) | $ | 0.06 | $ | 0.28 | $ | 0.25 | $ | 0.16 | $ | 0.77 | $ | 0.26 | $ | 0.32 | $ | 0.48 | $ | 1.82 | |||||||||||||||||||
Diluted |
$ | (0.47 | ) | $ | 0.06 | $ | 0.28 | $ | 0.24 | $ | 0.16 | $ | 0.76 | $ | 0.26 | $ | 0.31 | $ | 0.47 | $ | 1.79 | |||||||||||||||||||
Net income (loss) available to Genworth Financial, Inc.s common stockholders per share |
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Basic |
$ | (0.47 | ) | $ | 0.06 | $ | 0.29 | $ | 0.25 | $ | 0.16 | $ | 0.77 | $ | 0.27 | $ | 0.31 | $ | 0.47 | $ | 1.82 | |||||||||||||||||||
Diluted |
$ | (0.47 | ) | $ | 0.06 | $ | 0.29 | $ | 0.24 | $ | 0.16 | $ | 0.76 | $ | 0.27 | $ | 0.31 | $ | 0.46 | $ | 1.79 | |||||||||||||||||||
Weighted-average common shares outstanding |
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Basic |
449.4 | 460.5 | 473.2 | 492.3 | 468.8 | 496.5 | 503.8 | 508.9 | 508.3 | 504.4 | ||||||||||||||||||||||||||||||
Diluted(2) |
449.4 | 466.0 | 478.1 | 500.1 | 474.9 | 502.9 | 509.3 | 514.1 | 517.4 | 510.9 |
(1) | Income (loss) from discontinued operations primarily relates to a settlement agreement involving the companys former lifestyle protection insurance business that was sold on December 1, 2015. |
(2) | Under applicable accounting guidance, companies in a loss position are required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share. Therefore, as a result of the loss from continuing operations for the three months ended December 31, 2023, the company was required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share for the three months ended December 31, 2023, as the inclusion of shares for performance stock units, restricted stock units and other equity-based awards of 6.3 million would have been antidilutive to the calculation. If the company had not incurred a loss from continuing operations for the three months ended December 31, 2023, dilutive potential weighted-average common shares outstanding would have been 455.7 million. |
8
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Reconciliation of Net Income (Loss) to Adjusted Operating Income (Loss)
(amounts in millions, except per share amounts)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
NET INCOME (LOSS) AVAILABLE TO GENWORTH FINANCIAL, INC.S COMMON STOCKHOLDERS |
$ | (212 | ) | $ | 29 | $ | 137 | $ | 122 | $ | 76 | $ | 381 | $ | 136 | $ | 159 | $ | 240 | $ | 916 | |||||||||||||||||||
Add: net income from continuing operations attributable to noncontrolling interests |
29 | 31 | 31 | 32 | 123 | 27 | 35 | 38 | 30 | 130 | ||||||||||||||||||||||||||||||
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NET INCOME (LOSS) |
(183 | ) | 60 | 168 | 154 | 199 | 408 | 171 | 197 | 270 | 1,046 | |||||||||||||||||||||||||||||
Less: income (loss) from discontinued operations, net of taxes |
(2 | ) | | 2 | | | (2 | ) | 5 | (1 | ) | (2 | ) | | ||||||||||||||||||||||||||
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INCOME (LOSS) FROM CONTINUING OPERATIONS |
(181 | ) | 60 | 166 | 154 | 199 | 410 | 166 | 198 | 272 | 1,046 | |||||||||||||||||||||||||||||
Less: net income from continuing operations attributable to noncontrolling interests |
29 | 31 | 31 | 32 | 123 | 27 | 35 | 38 | 30 | 130 | ||||||||||||||||||||||||||||||
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INCOME (LOSS) FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL, INC.S COMMON STOCKHOLDERS |
(210 | ) | 29 | 135 | 122 | 76 | 383 | 131 | 160 | 242 | 916 | |||||||||||||||||||||||||||||
ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL, INC.S COMMON STOCKHOLDERS: |
||||||||||||||||||||||||||||||||||||||||
Net investment (gains) losses, net(1) |
(38 | ) | 43 | (41 | ) | 11 | (25 | ) | 5 | 58 | (19 | ) | (42 | ) | 2 | |||||||||||||||||||||||||
Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges(2) |
13 | (26 | ) | (23 | ) | 14 | (22 | ) | (64 | ) | (32 | ) | 8 | (54 | ) | (142 | ) | |||||||||||||||||||||||
(Gains) losses on early extinguishment of debt |
(1 | ) | | | (1 | ) | (2 | ) | (1 | ) | 3 | 1 | 3 | 6 | ||||||||||||||||||||||||||
Expenses related to restructuring |
| | 1 | 3 | 4 | 1 | | 1 | | 2 | ||||||||||||||||||||||||||||||
Pension plan termination costs |
| | | | | 2 | 6 | | | 8 | ||||||||||||||||||||||||||||||
Taxes on adjustments |
6 | (4 | ) | 13 | (5 | ) | 10 | 12 | (8 | ) | 2 | 20 | 26 | |||||||||||||||||||||||||||
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|||||||||||||||||||||
ADJUSTED OPERATING INCOME (LOSS) |
$ | (230 | ) | $ | 42 | $ | 85 | $ | 144 | $ | 41 | $ | 338 | $ | 158 | $ | 153 | $ | 169 | $ | 818 | |||||||||||||||||||
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|
|||||||||||||||||||||
ADJUSTED OPERATING INCOME (LOSS): |
||||||||||||||||||||||||||||||||||||||||
Enact segment |
$ | 129 | $ | 134 | $ | 146 | $ | 143 | $ | 552 | $ | 120 | $ | 156 | $ | 167 | $ | 135 | $ | 578 | ||||||||||||||||||||
Long-Term Care Insurance segment |
(151 | ) | (71 | ) | (43 | ) | 23 | (242 | ) | 204 | 26 | 17 | 73 | 320 | ||||||||||||||||||||||||||
Life and Annuities segment: |
||||||||||||||||||||||||||||||||||||||||
Life Insurance |
(206 | ) | (25 | ) | (17 | ) | (27 | ) | (275 | ) | 1 | (28 | ) | (37 | ) | (47 | ) | (111 | ) | |||||||||||||||||||||
Fixed Annuities |
9 | 17 | 10 | 14 | 50 | 14 | 15 | 20 | 13 | 62 | ||||||||||||||||||||||||||||||
Variable Annuities |
14 | 5 | 9 | 9 | 37 | 8 | 7 | 2 | 4 | 21 | ||||||||||||||||||||||||||||||
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Total Life and Annuities segment |
(183 | ) | (3 | ) | 2 | (4 | ) | (188 | ) | 23 | (6 | ) | (15 | ) | (30 | ) | (28 | ) | ||||||||||||||||||||||
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Corporate and Other |
(25 | ) | (18 | ) | (20 | ) | (18 | ) | (81 | ) | (9 | ) | (18 | ) | (16 | ) | (9 | ) | (52 | ) | ||||||||||||||||||||
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|
|||||||||||||||||||||
ADJUSTED OPERATING INCOME (LOSS) |
$ | (230 | ) | $ | 42 | $ | 85 | $ | 144 | $ | 41 | $ | 338 | $ | 158 | $ | 153 | $ | 169 | $ | 818 | |||||||||||||||||||
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Earnings (Loss) Per Share Data: |
||||||||||||||||||||||||||||||||||||||||
Net income (loss) available to Genworth Financial, Inc.s common stockholders per share |
||||||||||||||||||||||||||||||||||||||||
Basic |
$ | (0.47 | ) | $ | 0.06 | $ | 0.29 | $ | 0.25 | $ | 0.16 | $ | 0.77 | $ | 0.27 | $ | 0.31 | $ | 0.47 | $ | 1.82 | |||||||||||||||||||
Diluted |
$ | (0.47 | ) | $ | 0.06 | $ | 0.29 | $ | 0.24 | $ | 0.16 | $ | 0.76 | $ | 0.27 | $ | 0.31 | $ | 0.46 | $ | 1.79 | |||||||||||||||||||
Adjusted operating income (loss) per share |
||||||||||||||||||||||||||||||||||||||||
Basic |
$ | (0.51 | ) | $ | 0.09 | $ | 0.18 | $ | 0.29 | $ | 0.09 | $ | 0.68 | $ | 0.31 | $ | 0.30 | $ | 0.33 | $ | 1.62 | |||||||||||||||||||
Diluted |
$ | (0.51 | ) | $ | 0.09 | $ | 0.18 | $ | 0.29 | $ | 0.09 | $ | 0.67 | $ | 0.31 | $ | 0.30 | $ | 0.33 | $ | 1.60 | |||||||||||||||||||
Weighted-average common shares outstanding |
||||||||||||||||||||||||||||||||||||||||
Basic |
449.4 | 460.5 | 473.2 | 492.3 | 468.8 | 496.5 | 503.8 | 508.9 | 508.3 | 504.4 | ||||||||||||||||||||||||||||||
Diluted(3) |
449.4 | 466.0 | 478.1 | 500.1 | 474.9 | 502.9 | 509.3 | 514.1 | 517.4 | 510.9 |
(1) | Net investment (gains) losses were adjusted for the portion attributable to noncontrolling interests (see page 35 for reconciliation). |
(2) | Changes in fair value of market risk benefits and associated hedges were adjusted to exclude changes in reserves, attributed fees and benefit payments (see page 25 for reconciliation). |
(3) | Under applicable accounting guidance, companies in a loss position are required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share. Therefore, as a result of the loss from continuing operations for the three months ended December 31, 2023, the company was required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share for the three months ended December 31, 2023, as the inclusion of shares for performance stock units, restricted stock units and other equity-based awards of 6.3 million would have been antidilutive to the calculation. If the company had not incurred a loss from continuing operations for the three months ended December 31, 2023, dilutive potential weighted-average common shares outstanding would have been 455.7 million. |
9
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
(amounts in millions)
December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
||||||||||||||||
ASSETS |
||||||||||||||||||||
Investments: |
||||||||||||||||||||
Fixed maturity securities available-for-sale, at fair value(1) |
$ | 46,781 | $ | 43,968 | $ | 46,070 | $ | 47,381 | $ | 46,583 | ||||||||||
Equity securities, at fair value |
396 | 363 | 378 | 364 | 319 | |||||||||||||||
Commercial mortgage loans(2) |
6,829 | 6,818 | 6,876 | 6,915 | 7,032 | |||||||||||||||
Less: Allowance for credit losses |
(27 | ) | (25 | ) | (24 | ) | (24 | ) | (22 | ) | ||||||||||
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|
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|
|
|
|||||||||||
Commercial mortgage loans, net |
6,802 | 6,793 | 6,852 | 6,891 | 7,010 | |||||||||||||||
Policy loans |
2,220 | 2,233 | 2,270 | 2,133 | 2,139 | |||||||||||||||
Limited partnerships |
2,821 | 2,699 | 2,585 | 2,456 | 2,331 | |||||||||||||||
Other invested assets |
731 | 645 | 648 | 617 | 566 | |||||||||||||||
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|
|
|
|
|
|
|
|||||||||||
Total investments |
59,751 | 56,701 | 58,803 | 59,842 | 58,948 | |||||||||||||||
Cash, cash equivalents and restricted cash |
2,215 | 1,993 | 2,173 | 1,752 | 1,799 | |||||||||||||||
Accrued investment income |
647 | 620 | 553 | 700 | 643 | |||||||||||||||
Deferred acquisition costs |
1,988 | 2,042 | 2,096 | 2,150 | 2,211 | |||||||||||||||
Intangible assets |
198 | 199 | 201 | 203 | 203 | |||||||||||||||
Reinsurance recoverable |
19,054 | 17,623 | 19,113 | 19,606 | 19,059 | |||||||||||||||
Less: Allowance for credit losses |
(29 | ) | (28 | ) | (64 | ) | (64 | ) | (63 | ) | ||||||||||
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|
|||||||||||
Reinsurance recoverable, net |
19,025 | 17,595 | 19,049 | 19,542 | 18,996 | |||||||||||||||
Other assets |
489 | 453 | 445 | 478 | 488 | |||||||||||||||
Deferred tax asset |
1,952 | 1,580 | 1,954 | 2,002 | 1,983 | |||||||||||||||
Market risk benefit assets |
43 | 39 | 37 | 28 | 26 | |||||||||||||||
Separate account assets |
4,509 | 4,244 | 4,533 | 4,479 | 4,417 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total assets |
$ | 90,817 | $ | 85,466 | $ | 89,844 | $ | 91,176 | $ | 89,714 | ||||||||||
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|||||||||||
(1) | Amortized cost of $49,365 million, $49,855 million, $49,864 million, $50,461 million and $50,834 million as of December 31, 2023, September 30, 2023, June 30, 2023, March 31, 2023 and December 31, 2022, respectively, and allowance for credit losses of $7 million, $6 million, $4 million, $15 million and $ as of December 31, 2023, September 30, 2023, June 30, 2023, March 31, 2023 and December 31, 2022, respectively. |
(2) | Net of unamortized balance of loan origination fees and costs of $4 million as of December 31, 2023, September 30, 2023, June 30, 2023, March 31, 2023, and December 31, 2022. |
10
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Consolidated Balance Sheets
(amounts in millions)
December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
||||||||||||||||
LIABILITIES AND EQUITY |
||||||||||||||||||||
Liabilities: |
||||||||||||||||||||
Future policy benefits |
$ | 57,655 | $ | 51,740 | $ | 56,443 | $ | 57,531 | $ | 55,407 | ||||||||||
Policyholder account balances |
15,540 | 15,590 | 15,922 | 16,202 | 16,564 | |||||||||||||||
Market risk benefit liabilities |
625 | 579 | 666 | 761 | 748 | |||||||||||||||
Liability for policy and contract claims |
652 | 631 | 628 | 665 | 683 | |||||||||||||||
Unearned premiums |
149 | 162 | 175 | 189 | 203 | |||||||||||||||
Other liabilities |
1,768 | 2,038 | 1,607 | 1,510 | 1,687 | |||||||||||||||
Long-term borrowings |
1,584 | 1,602 | 1,601 | 1,600 | 1,611 | |||||||||||||||
Separate account liabilities |
4,509 | 4,244 | 4,533 | 4,479 | 4,417 | |||||||||||||||
Liabilities related to discontinued operations(1) |
| 2 | 2 | 7 | 8 | |||||||||||||||
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|
|
|
|
|
|
|
|
|||||||||||
Total liabilities |
82,482 | 76,588 | 81,577 | 82,944 | 81,328 | |||||||||||||||
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|
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|
|
|||||||||||
Equity: |
||||||||||||||||||||
Common stock |
1 | 1 | 1 | 1 | 1 | |||||||||||||||
Additional paid-in capital |
11,884 | 11,877 | 11,869 | 11,863 | 11,869 | |||||||||||||||
Accumulated other comprehensive income (loss): |
||||||||||||||||||||
Change in the discount rate used to measure future policy benefits |
(1,439 | ) | 1,826 | (964 | ) | (1,628 | ) | (403 | ) | |||||||||||
All other |
(1,116 | ) | (4,046 | ) | (1,897 | ) | (1,225 | ) | (2,211 | ) | ||||||||||
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|
|||||||||||
Total accumulated other comprehensive income (loss) |
(2,555 | ) | (2,220 | ) | (2,861 | ) | (2,853 | ) | (2,614 | ) | ||||||||||
Retained earnings |
1,213 | 1,426 | 1,398 | 1,261 | 1,139 | |||||||||||||||
Treasury stock, at cost |
(3,063 | ) | (3,028 | ) | (2,947 | ) | (2,833 | ) | (2,764 | ) | ||||||||||
|
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|
|
|
|
|
|
|
|
|||||||||||
Total Genworth Financial, Inc.s stockholders equity |
7,480 | 8,056 | 7,460 | 7,439 | 7,631 | |||||||||||||||
Noncontrolling interests |
855 | 822 | 807 | 793 | 755 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total equity |
8,335 | 8,878 | 8,267 | 8,232 | 8,386 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total liabilities and equity |
$ | 90,817 | $ | 85,466 | $ | 89,844 | $ | 91,176 | $ | 89,714 | ||||||||||
|
|
|
|
|
|
|
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|
|||||||||||
(1) | Liabilities related to discontinued operations relates to a liability recorded in connection with a settlement agreement reached with AXA and other unrelated liabilities involving the sale of the companys former lifestyle protection insurance business. |
11
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Consolidated Balance Sheet by Segment
(amounts in millions)
December 31, 2023 | ||||||||||||||||||||
Enact | Long-Term Care Insurance |
Life and Annuities |
Corporate and Other(1) |
Total | ||||||||||||||||
ASSETS |
||||||||||||||||||||
Cash and investments |
$ | 5,964 | $ | 35,923 | $ | 19,032 | $ | 1,694 | $ | 62,613 | ||||||||||
Deferred acquisition costs and intangible assets |
44 | 900 | 1,228 | 14 | 2,186 | |||||||||||||||
Reinsurance recoverable, net |
1 | 7,572 | 11,452 | | 19,025 | |||||||||||||||
Deferred tax and other assets |
184 | 1,800 | 253 | 204 | 2,441 | |||||||||||||||
Market risk benefit assets |
| | 43 | | 43 | |||||||||||||||
Separate account assets |
| | 4,509 | | 4,509 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total assets |
$ | 6,193 | $ | 46,195 | $ | 36,517 | $ | 1,912 | $ | 90,817 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
LIABILITIES AND EQUITY |
||||||||||||||||||||
Liabilities: |
||||||||||||||||||||
Future policy benefits |
$ | | $ | 43,929 | $ | 13,726 | $ | | $ | 57,655 | ||||||||||
Policyholder account balances |
| | 15,540 | | 15,540 | |||||||||||||||
Market risk benefit liabilities |
| | 625 | | 625 | |||||||||||||||
Liability for policy and contract claims |
518 | | 126 | 8 | 652 | |||||||||||||||
Unearned premiums |
149 | | | | 149 | |||||||||||||||
Other liabilities |
141 | 775 | 273 | 579 | 1,768 | |||||||||||||||
Borrowings |
745 | | | 839 | 1,584 | |||||||||||||||
Separate account liabilities |
| | 4,509 | | 4,509 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total liabilities |
1,553 | 44,704 | 34,799 | 1,426 | 82,482 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Equity: |
||||||||||||||||||||
Allocated equity, excluding accumulated other comprehensive income (loss) |
3,974 | 2,572 | 2,552 | 937 | 10,035 | |||||||||||||||
Allocated accumulated other comprehensive income (loss) |
(189 | ) | (1,081 | ) | (834 | ) | (451 | ) | (2,555 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total Genworth Financial, Inc.s stockholders equity |
3,785 | 1,491 | 1,718 | 486 | 7,480 | |||||||||||||||
Noncontrolling interests |
855 | | | | 855 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total equity |
4,640 | 1,491 | 1,718 | 486 | 8,335 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total liabilities and equity |
$ | 6,193 | $ | 46,195 | $ | 36,517 | $ | 1,912 | $ | 90,817 | ||||||||||
|
|
|
|
|
|
|
|
|
|
(1) | Includes inter-segment eliminations and other businesses, including start-up growth initiatives and certain international businesses, that are managed outside the operating segments. |
12
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Consolidated Balance Sheet by Segment
(amounts in millions)
September 30, 2023 | ||||||||||||||||||||
Enact | Long-Term Care Insurance |
Life and Annuities |
Corporate and Other(1) |
Total | ||||||||||||||||
ASSETS |
||||||||||||||||||||
Cash and investments |
$ | 5,750 | $ | 33,890 | $ | 18,457 | $ | 1,217 | $ | 59,314 | ||||||||||
Deferred acquisition costs and intangible assets |
41 | 917 | 1,273 | 10 | 2,241 | |||||||||||||||
Reinsurance recoverable, net |
| 6,814 | 10,781 | | 17,595 | |||||||||||||||
Deferred tax and other assets |
209 | 1,306 | 317 | 201 | 2,033 | |||||||||||||||
Market risk benefit assets |
| | 39 | | 39 | |||||||||||||||
Separate account assets |
| | 4,244 | | 4,244 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total assets |
$ | 6,000 | $ | 42,927 | $ | 35,111 | $ | 1,428 | $ | 85,466 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
LIABILITIES AND EQUITY |
||||||||||||||||||||
Liabilities: |
||||||||||||||||||||
Future policy benefits |
$ | | $ | 38,928 | $ | 12,812 | $ | | $ | 51,740 | ||||||||||
Policyholder account balances |
| | 15,590 | | 15,590 | |||||||||||||||
Market risk benefit liabilities |
| | 579 | | 579 | |||||||||||||||
Liability for policy and contract claims |
501 | | 123 | 7 | 631 | |||||||||||||||
Unearned premiums |
162 | | | | 162 | |||||||||||||||
Other liabilities |
124 | 1,175 | 250 | 489 | 2,038 | |||||||||||||||
Borrowings |
745 | | | 857 | 1,602 | |||||||||||||||
Separate account liabilities |
| | 4,244 | | 4,244 | |||||||||||||||
Liabilities related to discontinued operations |
| | | 2 | 2 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total liabilities |
1,532 | 40,103 | 33,598 | 1,355 | 76,588 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Equity: |
||||||||||||||||||||
Allocated equity, excluding accumulated other comprehensive income (loss) |
3,974 | 2,690 | 2,940 | 672 | 10,276 | |||||||||||||||
Allocated accumulated other comprehensive income (loss) |
(328 | ) | 134 | (1,427 | ) | (599 | ) | (2,220 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total Genworth Financial, Inc.s stockholders equity |
3,646 | 2,824 | 1,513 | 73 | 8,056 | |||||||||||||||
Noncontrolling interests |
822 | | | | 822 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total equity |
4,468 | 2,824 | 1,513 | 73 | 8,878 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total liabilities and equity |
$ | 6,000 | $ | 42,927 | $ | 35,111 | $ | 1,428 | $ | 85,466 | ||||||||||
|
|
|
|
|
|
|
|
|
|
(1) | Includes inter-segment eliminations and other businesses, including start-up growth initiatives and certain international businesses, that are managed outside the operating segments. |
13
Enact Segment
14
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Adjusted Operating Income and SalesEnact Segment
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
REVENUES: |
||||||||||||||||||||||||||||||||||||||||
Premiums |
$ | 240 | $ | 243 | $ | 239 | $ | 235 | $ | 957 | $ | 233 | $ | 235 | $ | 238 | $ | 234 | $ | 940 | ||||||||||||||||||||
Net investment income |
57 | 55 | 50 | 46 | 208 | 45 | 39 | 36 | 35 | 155 | ||||||||||||||||||||||||||||||
Net investment gains (losses) |
(1 | ) | | (13 | ) | | (14 | ) | (1 | ) | | (1 | ) | | (2 | ) | ||||||||||||||||||||||||
Policy fees and other income |
| 1 | 1 | | 2 | | 1 | | 1 | 2 | ||||||||||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total revenues |
296 | 299 | 277 | 281 | 1,153 | 277 | 275 | 273 | 270 | 1,095 | ||||||||||||||||||||||||||||||
|
|
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
BENEFITS AND EXPENSES: |
||||||||||||||||||||||||||||||||||||||||
Benefits and other changes in policy reserves |
24 | 18 | (4 | ) | (11 | ) | 27 | 18 | (40 | ) | (62 | ) | (10 | ) | (94 | ) | ||||||||||||||||||||||||
Acquisition and operating expenses, net of deferrals |
56 | 52 | 52 | 52 | 212 | 60 | 55 | 58 | 54 | 227 | ||||||||||||||||||||||||||||||
Amortization of deferred acquisition costs and intangibles |
3 | 3 | 2 | 3 | 11 | 2 | 4 | 3 | 3 | 12 | ||||||||||||||||||||||||||||||
Interest expense |
13 | 13 | 13 | 13 | 52 | 14 | 12 | 13 | 13 | 52 | ||||||||||||||||||||||||||||||
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Total benefits and expenses |
96 | 86 | 63 | 57 | 302 | 94 | 31 | 12 | 60 | 197 | ||||||||||||||||||||||||||||||
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INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES |
200 | 213 | 214 | 224 | 851 | 183 | 244 | 261 | 210 | 898 | ||||||||||||||||||||||||||||||
Provision for income taxes |
43 | 48 | 46 | 49 | 186 | 39 | 53 | 57 | 45 | 194 | ||||||||||||||||||||||||||||||
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INCOME FROM CONTINUING OPERATIONS |
157 | 165 | 168 | 175 | 665 | 144 | 191 | 204 | 165 | 704 | ||||||||||||||||||||||||||||||
Less: net income from continuing operations attributable to noncontrolling interests |
29 | 31 | 31 | 32 | 123 | 27 | 35 | 38 | 30 | 130 | ||||||||||||||||||||||||||||||
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INCOME FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL, INC.S COMMON STOCKHOLDERS |
128 | 134 | 137 | 143 | 542 | 117 | 156 | 166 | 135 | 574 | ||||||||||||||||||||||||||||||
ADJUSTMENTS TO INCOME FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL, INC.S COMMON STOCKHOLDERS: |
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Net investment (gains) losses, net(1) |
1 | | 11 | | 12 | 1 | | 1 | | 2 | ||||||||||||||||||||||||||||||
Expenses related to restructuring |
| | | | | 3 | | | | 3 | ||||||||||||||||||||||||||||||
Taxes on adjustments |
| | (2 | ) | | (2 | ) | (1 | ) | | | | (1 | ) | ||||||||||||||||||||||||||
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ADJUSTED OPERATING INCOME |
$ | 129 | $ | 134 | $ | 146 | $ | 143 | $ | 552 | $ | 120 | $ | 156 | $ | 167 | $ | 135 | $ | 578 | ||||||||||||||||||||
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SALES: |
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Direct Primary New Insurance Written (NIW) |
$ | 10,453 | $ | 14,391 | $ | 15,083 | $ | 13,154 | $ | 53,081 | $ | 15,145 | $ | 15,069 | $ | 17,448 | $ | 18,823 | $ | 66,485 | ||||||||||||||||||||
(1) | Net investment (gains) losses were adjusted for the portion attributable to noncontrolling interests of $2 million in the second quarter of 2023. |
15
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Direct Primary New Insurance Written MetricsEnact Segment
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Direct Primary NIW |
% of Direct Primary NIW |
Direct Primary NIW |
% of Direct Primary NIW |
Direct Primary NIW |
% of Direct Primary NIW |
Direct Primary NIW |
% of Direct Primary NIW |
Direct Primary NIW |
% of Direct Primary NIW |
Direct Primary NIW |
% of Direct Primary NIW |
Direct Primary NIW |
% of Direct Primary NIW |
Direct Primary NIW |
% of Direct Primary NIW |
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Payment Type |
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Monthly |
$ | 10,187 | 98 | % | $ | 14,099 | 98 | % | $ | 14,774 | 98 | % | $ | 12,809 | 97 | % | $ | 13,745 | 91 | % | $ | 14,138 | 94 | % | $ | 16,169 | 93 | % | $ | 17,071 | 91 | % | ||||||||||||||||||||||||||||||||
Single |
246 | 2 | 269 | 2 | 281 | 2 | 318 | 3 | 1,368 | 9 | 890 | 6 | 1,218 | 7 | 1,690 | 9 | ||||||||||||||||||||||||||||||||||||||||||||||||
Other(1) |
20 | | 23 | | 28 | | 27 | | 32 | | 41 | | 61 | | 62 | | ||||||||||||||||||||||||||||||||||||||||||||||||
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Total |
$ | 10,453 | 100 | % | $ | 14,391 | 100 | % | $ | 15,083 | 100 | % | $ | 13,154 | 100 | % | $ | 15,145 | 100 | % | $ | 15,069 | 100 | % | $ | 17,448 | 100 | % | $ | 18,823 | 100 | % | ||||||||||||||||||||||||||||||||
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Origination |
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Purchase |
$ | 10,169 | 97 | % | $ | 14,073 | 98 | % | $ | 14,720 | 98 | % | $ | 12,761 | 97 | % | $ | 14,744 | 97 | % | $ | 14,634 | 97 | % | $ | 16,802 | 96 | % | $ | 17,326 | 92 | % | ||||||||||||||||||||||||||||||||
Refinance |
284 | 3 | 318 | 2 | 363 | 2 | 393 | 3 | 401 | 3 | 435 | 3 | 646 | 4 | 1,497 | 8 | ||||||||||||||||||||||||||||||||||||||||||||||||
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Total |
$ | 10,453 | 100 | % | $ | 14,391 | 100 | % | $ | 15,083 | 100 | % | $ | 13,154 | 100 | % | $ | 15,145 | 100 | % | $ | 15,069 | 100 | % | $ | 17,448 | 100 | % | $ | 18,823 | 100 | % | ||||||||||||||||||||||||||||||||
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FICO Scores |
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Over 760 |
$ | 5,086 | 49 | % | $ | 6,679 | 46 | % | $ | 6,911 | 46 | % | $ | 6,004 | 46 | % | $ | 6,951 | 46 | % | $ | 6,948 | 46 | % | $ | 7,981 | 45 | % | $ | 8,359 | 45 | % | ||||||||||||||||||||||||||||||||
740 - 759 |
1,680 | 16 | 2,438 | 17 | 2,608 | 17 | 2,268 | 17 | 2,709 | 18 | 2,554 | 17 | 2,916 | 17 | 3,085 | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||
720 - 739 |
1,378 | 13 | 1,928 | 13 | 2,097 | 14 | 1,817 | 14 | 2,226 | 15 | 2,106 | 14 | 2,530 | 15 | 2,515 | 13 | ||||||||||||||||||||||||||||||||||||||||||||||||
700 - 719 |
997 | 10 | 1,422 | 10 | 1,499 | 10 | 1,296 | 10 | 1,489 | 10 | 1,531 | 10 | 1,917 | 11 | 1,952 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||
680 - 699 |
664 | 6 | 974 | 7 | 1,060 | 7 | 954 | 7 | 1,035 | 7 | 1,085 | 7 | 1,099 | 6 | 1,316 | 7 | ||||||||||||||||||||||||||||||||||||||||||||||||
660 - 679(2) |
409 | 4 | 592 | 4 | 568 | 4 | 517 | 4 | 478 | 3 | 527 | 3 | 598 | 3 | 931 | 5 | ||||||||||||||||||||||||||||||||||||||||||||||||
640 - 659 |
181 | 2 | 282 | 2 | 260 | 2 | 229 | 2 | 189 | 1 | 234 | 2 | 297 | 2 | 486 | 3 | ||||||||||||||||||||||||||||||||||||||||||||||||
620 - 639 |
53 | | 74 | 1 | 76 | | 65 | | 66 | | 79 | 1 | 106 | 1 | 173 | 1 | ||||||||||||||||||||||||||||||||||||||||||||||||
<620 |
5 | | 2 | | 4 | | 4 | | 2 | | 5 | | 4 | | 6 | | ||||||||||||||||||||||||||||||||||||||||||||||||
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Total |
$ | 10,453 | 100 | % | $ | 14,391 | 100 | % | $ | 15,083 | 100 | % | $ | 13,154 | 100 | % | $ | 15,145 | 100 | % | $ | 15,069 | 100 | % | $ | 17,448 | 100 | % | $ | 18,823 | 100 | % | ||||||||||||||||||||||||||||||||
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Loan-To-Value Ratio |
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95.01% and above |
$ | 1,820 | 18 | % | $ | 2,677 | 18 | % | $ | 2,692 | 18 | % | $ | 2,106 | 16 | % | $ | 2,423 | 16 | % | $ | 1,741 | 11 | % | $ | 2,177 | 12 | % | $ | 3,146 | 17 | % | ||||||||||||||||||||||||||||||||
90.01% to 95.00% |
3,759 | 36 | 5,431 | 38 | 5,743 | 38 | 4,928 | 38 | 5,684 | 37 | 6,184 | 41 | 7,458 | 43 | 6,682 | 35 | ||||||||||||||||||||||||||||||||||||||||||||||||
85.01% to 90.00% |
3,489 | 33 | 4,568 | 32 | 4,753 | 31 | 4,390 | 33 | 4,971 | 33 | 5,094 | 34 | 5,207 | 30 | 5,620 | 30 | ||||||||||||||||||||||||||||||||||||||||||||||||
85.00% and below |
1,385 | 13 | 1,715 | 12 | 1,895 | 13 | 1,730 | 13 | 2,067 | 14 | 2,050 | 14 | 2,606 | 15 | 3,375 | 18 | ||||||||||||||||||||||||||||||||||||||||||||||||
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Total |
$ | 10,453 | 100 | % | $ | 14,391 | 100 | % | $ | 15,083 | 100 | % | $ | 13,154 | 100 | % | $ | 15,145 | 100 | % | $ | 15,069 | 100 | % | $ | 17,448 | 100 | % | $ | 18,823 | 100 | % | ||||||||||||||||||||||||||||||||
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Debt-To-Income Ratio |
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45.01% and above |
$ | 3,158 | 30 | % | $ | 4,437 | 31 | % | $ | 4,467 | 30 | % | $ | 3,538 | 27 | % | $ | 4,294 | 28 | % | $ | 3,728 | 25 | % | $ | 4,067 | 23 | % | $ | 4,452 | 24 | % | ||||||||||||||||||||||||||||||||
38.01% to 45.00% |
3,816 | 37 | 4,936 | 34 | 5,214 | 34 | 4,940 | 38 | 5,518 | 37 | 5,681 | 38 | 6,436 | 37 | 6,361 | 34 | ||||||||||||||||||||||||||||||||||||||||||||||||
38.00% and below |
3,479 | 33 | 5,018 | 35 | 5,402 | 36 | 4,676 | 35 | 5,333 | 35 | 5,660 | 37 | 6,945 | 40 | 8,010 | 42 | ||||||||||||||||||||||||||||||||||||||||||||||||
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Total |
$ | 10,453 | 100 | % | $ | 14,391 | 100 | % | $ | 15,083 | 100 | % | $ | 13,154 | 100 | % | $ | 15,145 | 100 | % | $ | 15,069 | 100 | % | $ | 17,448 | 100 | % | $ | 18,823 | 100 | % | ||||||||||||||||||||||||||||||||
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(1) | Includes loans with annual and split payment types. |
(2) | Loans with unknown FICO scores are included in the 660-679 category. |
16
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Other MetricsEnact Segment
(dollar amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
Direct Primary Insurance In-Force |
$ | 262,937 | $ | 262,014 | $ | 257,816 | $ | 252,516 | $ | 248,262 | $ | 241,813 | $ | 237,563 | $ | 231,853 | ||||||||||||||||||||||||
Direct Risk In-Force |
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Primary |
$ | 67,529 | $ | 67,056 | $ | 65,714 | $ | 64,106 | $ | 62,791 | $ | 61,124 | $ | 59,911 | $ | 58,295 | ||||||||||||||||||||||||
Pool |
69 | 70 | 73 | 76 | 79 | 84 | 89 | 97 | ||||||||||||||||||||||||||||||||
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Total Direct Risk In-Force |
$ | 67,598 | $ | 67,126 | $ | 65,787 | $ | 64,182 | $ | 62,870 | $ | 61,208 | $ | 60,000 | $ | 58,392 | ||||||||||||||||||||||||
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Expense Ratio(1) |
25 | % | 23 | % | 23 | % | 23 | % | 23 | % | 27 | % | 25 | % | 26 | % | 24 | % | 25 | % | ||||||||||||||||||||
Primary Persistency Rate |
86 | % | 84 | % | 84 | % | 85 | % | 85 | % | 86 | % | 82 | % | 80 | % | 76 | % | 85 | % | ||||||||||||||||||||
Combined Risk To Capital Ratio(2) |
11.6:1 | 11.6:1 | 11.8:1 | 12.6:1 | 12.8:1 | 12.3:1 | 12.6:1 | 12.0:1 | ||||||||||||||||||||||||||||||||
EMICO Risk To Capital Ratio(2),(3) |
11.6:1 | 11.6:1 | 11.9:1 | 12.7:1 | 12.9:1 | 12.3:1 | 12.6:1 | 12.1:1 | ||||||||||||||||||||||||||||||||
PMIERs Available Assets(4) |
$ | 5,006 | $ | 5,268 | $ | 5,093 | $ | 5,357 | $ | 5,206 | $ | 5,292 | $ | 5,147 | $ | 5,222 | ||||||||||||||||||||||||
PMIERs Required Assets(4) |
$ | 3,119 | $ | 3,251 | $ | 3,135 | $ | 3,259 | $ | 3,156 | $ | 3,043 | $ | 3,100 | $ | 2,961 | ||||||||||||||||||||||||
Available Assets Above PMIERs Requirements(4) |
$ | 1,887 | $ | 2,017 | $ | 1,958 | $ | 2,098 | $ | 2,050 | $ | 2,249 | $ | 2,047 | $ | 2,261 | ||||||||||||||||||||||||
PMIERs Sufficiency Ratio(4) |
161 | % | 162 | % | 162 | % | 164 | % | 165 | % | 174 | % | 166 | % | 176 | % | ||||||||||||||||||||||||
Average Primary Loan Size (in thousands) |
$ | 270 | $ | 268 | $ | 265 | $ | 262 | $ | 259 | $ | 255 | $ | 251 | $ | 246 |
The expense ratio included above was calculated using whole dollars and may be different than the ratio calculated using the rounded numbers included herein.
(1) | The ratio of an insurers general expenses to net earned premiums. In the business, general expenses consist of acquisition and operating expenses, net of deferrals, and amortization of DAC and intangibles. |
(2) | Certain states limit a private mortgage insurers risk in-force to 25 times the total of the insurers policyholders surplus plus the statutory contingency reserve, commonly known as the risk to capital requirement. The current period risk to capital ratio is an estimate due to the timing of the filing of statutory statements and is prepared consistent with the presentation of the statutory financial statements in the combined annual statement of the companys U.S. mortgage insurance subsidiaries. |
(3) | Enact Mortgage Insurance Corporation (EMICO), the companys principal U.S. mortgage insurance subsidiary. |
(4) | The Private Mortgage Insurer Eligibility Requirements (PMIERs) sufficiency ratio is calculated as available assets divided by required assets as defined within PMIERs. The current period PMIERs sufficiency ratio is an estimate due to the timing of the PMIERs filing. The PMIERs sufficiency ratios for the four quarters of 2022 did not take into consideration the impact of restrictions previously imposed by the government-sponsored enterprises on EMICO. |
17
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Loss MetricsEnact Segment
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
Average Paid Claim (in thousands)(1) |
$ | 42.9 | $ | 46.8 | $ | 46.6 | $ | 46.9 | $ | 48.7 | $ | 42.2 | $ | 50.1 | $ | 51.6 | ||||||||||||||||||||||||
Average Reserve Per Primary Delinquency (in thousands)(2) |
$ | 23.3 | $ | 23.9 | $ | 25.0 | $ | 24.8 | $ | 24.0 | $ | 25.2 | $ | 27.0 | $ | 26.2 | ||||||||||||||||||||||||
Reserves: |
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Direct primary case(3) |
$ | 477 | $ | 460 | $ | 452 | $ | 462 | $ | 479 | $ | 476 | $ | 526 | $ | 591 | ||||||||||||||||||||||||
All other(3) |
41 | 41 | 38 | 40 | 40 | 34 | 33 | 34 | ||||||||||||||||||||||||||||||||
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Total Reserves |
$ | 518 | $ | 501 | $ | 490 | $ | 502 | $ | 519 | $ | 510 | $ | 559 | $ | 625 | ||||||||||||||||||||||||
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Beginning Reserves |
$ | 501 | $ | 490 | $ | 502 | $ | 519 | $ | 519 | $ | 510 | $ | 559 | $ | 625 | $ | 641 | $ | 641 | ||||||||||||||||||||
Paid claims |
(7 | ) | (7 | ) | (8 | ) | (6 | ) | (28 | ) | (9 | ) | (9 | ) | (4 | ) | (6 | ) | (28 | ) | ||||||||||||||||||||
Increase (decrease) in reserves |
24 | 18 | (4 | ) | (11 | ) | 27 | 18 | (40 | ) | (62 | ) | (10 | ) | (94 | ) | ||||||||||||||||||||||||
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Ending Reserves |
$ | 518 | $ | 501 | $ | 490 | $ | 502 | $ | 518 | $ | 519 | $ | 510 | $ | 559 | $ | 625 | $ | 519 | ||||||||||||||||||||
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Loss Ratio |
10 | % | 7 | % | (2 | )% | (5 | )% | 3 | % | 8 | % | (17 | )% | (26 | )% | (4 | )% | (10 | )% | ||||||||||||||||||||
The loss ratio included above was calculated using whole dollars and may be different than the ratio calculated using the rounded numbers included herein.
(1) | Average paid claims in the fourth quarter of 2023 and the fourth and third quarters of 2022 include payments in relation to agreements on non-performing loans. |
(2) | Direct primary case reserves divided by primary delinquency count. |
(3) | Direct primary case reserves exclude loss adjustment expenses (LAE), pool, incurred but not reported (IBNR) and reinsurance reserves. Other includes LAE, pool, IBNR and reinsurance reserves. |
18
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Delinquency MetricsEnact Segment
(dollar amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
Primary Loans |
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Primary loans in-force |
974,516 | 977,832 | 973,280 | 965,544 | 960,306 | 949,052 | 946,891 | 941,689 | ||||||||||||||||||||||||||||||||
Primary delinquent loans |
20,432 | 19,241 | 18,065 | 18,633 | 19,943 | 18,856 | 19,513 | 22,571 | ||||||||||||||||||||||||||||||||
Primary delinquency rate |
2.10 | % | 1.97 | % | 1.86 | % | 1.93 | % | 2.08 | % | 1.99 | % | 2.06 | % | 2.40 | % | ||||||||||||||||||||||||
Beginning Number of Primary Delinquencies |
19,241 | 18,065 | 18,633 | 19,943 | 19,943 | 18,856 | 19,513 | 22,571 | 24,820 | 24,820 | ||||||||||||||||||||||||||||||
New delinquencies |
11,706 | 11,107 | 9,205 | 9,599 | 41,617 | 10,304 | 9,121 | 7,847 | 8,724 | 35,996 | ||||||||||||||||||||||||||||||
Delinquency cures |
(10,317 | ) | (9,778 | ) | (9,609 | ) | (10,771 | ) | (40,475 | ) | (9,024 | ) | (9,588 | ) | (10,806 | ) | (10,860 | ) | (40,278 | ) | ||||||||||||||||||||
Paid claims |
(186 | ) | (147 | ) | (156 | ) | (126 | ) | (615 | ) | (190 | ) | (187 | ) | (90 | ) | (107 | ) | (574 | ) | ||||||||||||||||||||
Rescissions and claim denials |
(12 | ) | (6 | ) | (8 | ) | (12 | ) | (38 | ) | (3 | ) | (3 | ) | (9 | ) | (6 | ) | (21 | ) | ||||||||||||||||||||
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|||||||||||||||||||||
Ending Number of Primary Delinquencies |
20,432 | 19,241 | 18,065 | 18,633 | 20,432 | 19,943 | 18,856 | 19,513 | 22,571 | 19,943 | ||||||||||||||||||||||||||||||
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Composition of Cures |
||||||||||||||||||||||||||||||||||||||||
Reported delinquent and cured-intraquarter |
2,058 | 1,877 | 1,661 | 2,016 | 1,489 | 1,598 | 1,306 | 1,581 | ||||||||||||||||||||||||||||||||
Number of missed payments delinquent prior to cure: |
||||||||||||||||||||||||||||||||||||||||
3 payments or less |
5,235 | 4,792 | 4,516 | 5,238 | 4,179 | 3,719 | 4,037 | 3,902 | ||||||||||||||||||||||||||||||||
4 - 11 payments |
2,331 | 2,265 | 2,448 | 2,431 | 2,001 | 2,279 | 2,484 | 2,315 | ||||||||||||||||||||||||||||||||
12 payments or more |
693 | 844 | 984 | 1,086 | 1,355 | 1,992 | 2,979 | 3,062 | ||||||||||||||||||||||||||||||||
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Total |
10,317 | 9,778 | 9,609 | 10,771 | 9,024 | 9,588 | 10,806 | 10,860 | ||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||||
Primary Delinquencies by Missed Payment Status |
||||||||||||||||||||||||||||||||||||||||
3 payments or less |
10,166 | 9,398 | 8,162 | 7,876 | 8,920 | 7,446 | 6,442 | 6,837 | ||||||||||||||||||||||||||||||||
4 - 11 payments |
6,934 | 6,381 | 6,229 | 6,714 | 6,466 | 6,119 | 6,372 | 6,875 | ||||||||||||||||||||||||||||||||
12 payments or more |
3,332 | 3,462 | 3,674 | 4,043 | 4,557 | 5,291 | 6,699 | 8,859 | ||||||||||||||||||||||||||||||||
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Primary Delinquencies |
20,432 | 19,241 | 18,065 | 18,633 | 19,943 | 18,856 | 19,513 | 22,571 | ||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||||
December 31, 2023 | ||||||||||||||||||||||||||||||||||||||||
Direct Primary Case Reserves(1) and Percentage Reserved by Payment Status |
Direct Primary Case Reserves |
Direct Primary Risk In-Force |
Reserves as % of Risk In-Force |
|||||||||||||||||||||||||||||||||||||
3 payments or less in default |
$ | 88 | $ | 629 | 14 | % | ||||||||||||||||||||||||||||||||||
4 - 11 payments in default |
205 | 469 | 44 | % | ||||||||||||||||||||||||||||||||||||
12 payments or more in default |
184 | 200 | 92 | % | ||||||||||||||||||||||||||||||||||||
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Total |
$ | 477 | $ | 1,298 | 37 | % | ||||||||||||||||||||||||||||||||||
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December 31, 2022 | ||||||||||||||||||||||||||||||||||||||||
Direct Primary Case Reserves(1) and Percentage Reserved by Payment Status |
Direct Primary Case Reserves |
Direct Primary Risk In-Force |
Reserves as % of Risk In-Force |
|||||||||||||||||||||||||||||||||||||
3 payments or less in default |
$ | 69 | $ | 509 | 14 | % | ||||||||||||||||||||||||||||||||||
4 - 11 payments in default |
166 | 390 | 43 | % | ||||||||||||||||||||||||||||||||||||
12 payments or more in default |
244 | 248 | 98 | % | ||||||||||||||||||||||||||||||||||||
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Total |
$ | 479 | $ | 1,147 | 42 | % | ||||||||||||||||||||||||||||||||||
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(1) | Direct primary case reserves exclude loss adjustment expenses, pool, incurred but not reported and reinsurance reserves. |
19
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Portfolio Quality MetricsEnact Segment
(amounts in millions)
December 31, 2023 | ||||||||||||||||||||||||
Policy Year |
% of Direct Primary Case Reserves(1) |
Direct Primary Insurance In-Force |
% of Total | Direct Primary Risk In-Force |
% of Total | Delinquency Rate |
||||||||||||||||||
2008 and prior |
18 | % | $ | 5,621 | 2 | % | $ | 1,449 | 2 | % | 8.61 | % | ||||||||||||
2009-2015 |
4 | 3,383 | 1 | 881 | 1 | 4.55 | % | |||||||||||||||||
2016 |
4 | 4,659 | 2 | 1,248 | 2 | 3.20 | % | |||||||||||||||||
2017 |
5 | 5,321 | 2 | 1,403 | 2 | 3.59 | % | |||||||||||||||||
2018 |
6 | 5,750 | 2 | 1,476 | 2 | 4.42 | % | |||||||||||||||||
2019 |
8 | 13,773 | 5 | 3,544 | 5 | 2.77 | % | |||||||||||||||||
2020 |
15 | 44,486 | 17 | 11,697 | 17 | 1.70 | % | |||||||||||||||||
2021 |
21 | 70,045 | 27 | 17,846 | 27 | 1.65 | % | |||||||||||||||||
2022 |
16 | 59,267 | 23 | 14,907 | 22 | 1.57 | % | |||||||||||||||||
2023 |
3 | 50,632 | 19 | 13,078 | 20 | 0.47 | % | |||||||||||||||||
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Total |
100 | % | $ | 262,937 | 100 | % | $ | 67,529 | 100 | % | 2.10 | % | ||||||||||||
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December 31, 2023 | September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
Direct Primary Risk In-Force |
% of Total | Direct Primary Risk In-Force |
% of Total | Direct Primary Risk In-Force |
% of Total | |||||||||||||||||||
Loan-to-value ratio |
||||||||||||||||||||||||
95.01% and above |
$ | 12,878 | 19 | % | $ | 12,595 | 19 | % | $ | 11,136 | 18 | % | ||||||||||||
90.01% to 95.00% |
31,781 | 47 | 31,696 | 47 | 30,079 | 48 | ||||||||||||||||||
85.01% to 90.00% |
19,163 | 28 | 18,945 | 28 | 17,621 | 28 | ||||||||||||||||||
85.00% and below |
3,707 | 6 | 3,820 | 6 | 3,955 | 6 | ||||||||||||||||||
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Total |
$ | 67,529 | 100 | % | $ | 67,056 | 100 | % | $ | 62,791 | 100 | % | ||||||||||||
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|
December 31, 2023 | September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
Direct Primary Risk In-Force |
% of Total | Direct Primary Risk In-Force |
% of Total | Direct Primary Risk In-Force |
% of Total | |||||||||||||||||||
Credit Quality |
||||||||||||||||||||||||
Over 760 |
$ | 28,363 | 42 | % | $ | 28,014 | 42 | % | $ | 25,807 | 41 | % | ||||||||||||
740 - 759 |
11,096 | 17 | 11,009 | 17 | 10,154 | 16 | ||||||||||||||||||
720 - 739 |
9,621 | 14 | 9,553 | 14 | 8,931 | 14 | ||||||||||||||||||
700 - 719 |
7,623 | 11 | 7,615 | 12 | 7,317 | 12 | ||||||||||||||||||
680 - 699 |
5,557 | 8 | 5,582 | 8 | 5,428 | 9 | ||||||||||||||||||
660 - 679(2) |
2,908 | 4 | 2,901 | 4 | 2,767 | 5 | ||||||||||||||||||
640 - 659 |
1,565 | 3 | 1,569 | 2 | 1,540 | 2 | ||||||||||||||||||
620 - 639 |
635 | 1 | 647 | 1 | 665 | 1 | ||||||||||||||||||
<620 |
161 | | 166 | | 182 | | ||||||||||||||||||
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Total |
$ | 67,529 | 100 | % | $ | 67,056 | 100 | % | $ | 62,791 | 100 | % | ||||||||||||
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(1) | Direct primary case reserves exclude loss adjustment expenses, pool, incurred but not reported and reinsurance reserves. |
(2) | Loans with unknown FICO scores are included in the 660-679 category. |
20
Long-Term Care Insurance Segment
21
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Adjusted Operating Income (Loss)Long-Term Care Insurance Segment
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q(1) | 3Q | 2Q | 1Q | Total | 4Q(2) | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
REVENUES: |
||||||||||||||||||||||||||||||||||||||||
Premiums |
$ | 615 | $ | 621 | $ | 611 | $ | 616 | $ | 2,463 | $ | 639 | $ | 637 | $ | 617 | $ | 607 | $ | 2,500 | ||||||||||||||||||||
Net investment income |
489 | 482 | 470 | 473 | 1,914 | 470 | 497 | 486 | 447 | 1,900 | ||||||||||||||||||||||||||||||
Net investment gains (losses) |
64 | (21 | ) | 62 | 9 | 114 | 20 | (47 | ) | 5 | 41 | 19 | ||||||||||||||||||||||||||||
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Total revenues |
1,168 | 1,082 | 1,143 | 1,098 | 4,491 | 1,129 | 1,087 | 1,108 | 1,095 | 4,419 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
BENEFITS AND EXPENSES: |
||||||||||||||||||||||||||||||||||||||||
Benefits and other changes in policy reserves |
964 | 953 | 941 | 944 | 3,802 | 965 | 956 | 942 | 925 | 3,788 | ||||||||||||||||||||||||||||||
Liability remeasurement (gains) losses |
188 | 104 | 61 | (32 | ) | 321 | (255 | ) | 3 | 23 | (88 | ) | (317 | ) | ||||||||||||||||||||||||||
Acquisition and operating expenses, net of deferrals |
116 | 109 | 108 | 119 | 452 | 100 | 122 | 95 | 96 | 413 | ||||||||||||||||||||||||||||||
Amortization of deferred acquisition costs and intangibles |
18 | 17 | 18 | 18 | 71 | 18 | 19 | 18 | 19 | 74 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
Total benefits and expenses |
1,286 | 1,183 | 1,128 | 1,049 | 4,646 | 828 | 1,100 | 1,078 | 952 | 3,958 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES |
(118 | ) | (101 | ) | 15 | 49 | (155 | ) | 301 | (13 | ) | 30 | 143 | 461 | ||||||||||||||||||||||||||
Provision (benefit) for income taxes |
(18 | ) | (13 | ) | 10 | 18 | (3 | ) | 79 | (1 | ) | 9 | 38 | 125 | ||||||||||||||||||||||||||
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|||||||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS |
(100 | ) | (88 | ) | 5 | 31 | (152 | ) | 222 | (12 | ) | 21 | 105 | 336 | ||||||||||||||||||||||||||
ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS: |
||||||||||||||||||||||||||||||||||||||||
Net investment (gains) losses |
(64 | ) | 21 | (62 | ) | (9 | ) | (114 | ) | (20 | ) | 47 | (5 | ) | (41 | ) | (19 | ) | ||||||||||||||||||||||
Expenses related to restructuring |
| | 1 | (1 | ) | | (2 | ) | | 1 | | (1 | ) | |||||||||||||||||||||||||||
Taxes on adjustments |
13 | (4 | ) | 13 | 2 | 24 | 4 | (9 | ) | | 9 | 4 | ||||||||||||||||||||||||||||
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|||||||||||||||||||||
ADJUSTED OPERATING INCOME (LOSS) |
$ | (151 | ) | $ | (71 | ) | $ | (43 | ) | $ | 23 | $ | (242 | ) | $ | 204 | $ | 26 | $ | 17 | $ | 73 | $ | 320 | ||||||||||||||||
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Liability remeasurement (gains) losses: |
||||||||||||||||||||||||||||||||||||||||
Cash flow assumption updates |
$ | 61 | $ | (6 | ) | $ | (24 | ) | $ | 21 | $ | 52 | $ | (303 | ) | $ | (10 | ) | $ | (20 | ) | $ | (2 | ) | $ | (335 | ) | |||||||||||||
Actual to expected experience |
127 | 110 | 85 | (53 | ) | 269 | 48 | 13 | 43 | (86 | ) | 18 | ||||||||||||||||||||||||||||
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Total |
$ | 188 | $ | 104 | $ | 61 | $ | (32 | ) | $ | 321 | $ | (255 | ) | $ | 3 | $ | 23 | $ | (88 | ) | $ | (317 | ) | ||||||||||||||||
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Ratio of the liability remeasurement (gains) losses to beginning reserves(3) |
0.45 | % | 0.25 | % | 0.15 | % | (0.08 | )% | 0.77 | % | (0.62 | )% | | % | 0.06 | % | (0.22 | )% | (0.78 | )% | ||||||||||||||||||||
(1) | In the fourth quarter of 2023, the liability remeasurement loss of $188 million in the companys long-term care insurance business reflected an unfavorable impact from annual cash flow assumption updates of $61 million, including updates to its healthy life assumptions to better align near-term experience for cost of care, mortality, incidence and lapse. These adverse assumption updates were partially offset by a favorable update to disabled life mortality assumptions to reflect an expectation that mortality will continue at elevated levels in the near term post-COVID-19. The company also evaluated its assumptions regarding expectations of future premium rate increase approvals and benefit reductions and made no significant changes to its 2023 multi-year in-force rate action plan. However, the company did increase the value of its assumption for future approvals and benefit reductions based on recent rate increase approval experience, regulatory support and legal settlement results. In addition, the company updated its assumptions for the third long-term care insurance legal settlement primarily impacting its Choice II policies, which represents approximately 35% of the overall block. As previously disclosed, the third legal settlement was mostly comprised of profitable uncapped cohorts. Cohorts with profits or margin have a net premium ratio below 100% and therefore have less of an impact on the liability remeasurement (gain) loss in the income statement. |
(2) | In the fourth quarter of 2022, the liability remeasurement gain of $255 million in the companys long-term care insurance business reflected favorable assumption updates of $303 million, largely from an update to legal settlement elections attributable to the inclusion of a second legal settlement and the resulting expected reserve reduction. This settlement, comprised of PCS I and PCS II policies, represents approximately 15% of the overall block and impacts older unprofitable capped cohorts. While a favorable assumption impact was recognized in the fourth quarter of 2022, differences between actual experience and expectations will flow through earnings in subsequent periods. The companys long-term care insurance business also updated its interest rate assumptions to reflect the impact of the higher interest rate environment. |
(3) | The ratio of the liability remeasurement (gains) losses to beginning reserves is calculated by dividing the liability remeasurement (gains) losses by the beginning liability for future policy benefits at the locked-in discount rate as of each applicable quarter. |
22
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Statutory Impact of In-Force Rate ActionsLong-Term Care Insurance Segment
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
Impact of in-force rate actions on pre-tax statutory earnings(1) |
||||||||||||||||||||||||||||||||||||||||
Premiums, premium tax, commissions and other expenses, net(2) |
$ | 232 | $ | 231 | $ | 224 | $ | 219 | $ | 906 | $ | 224 | $ | 220 | $ | 207 | $ | 192 | $ | 843 | ||||||||||||||||||||
Reserve changes(2) |
119 | 99 | 104 | 94 | 416 | 124 | 120 | 113 | 132 | 489 | ||||||||||||||||||||||||||||||
Settlement impacts - reserve changes |
232 | 169 | 97 | 93 | 591 | 78 | 9 | 19 | 148 | 254 | ||||||||||||||||||||||||||||||
Settlement impacts - litigation expenses and settlement payments |
(116 | ) | (102 | ) | (54 | ) | (56 | ) | (328 | ) | (45 | ) | (10 | ) | (6 | ) | (43 | ) | (104 | ) | ||||||||||||||||||||
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Settlement impacts, net |
116 | 67 | 43 | 37 | 263 | 33 | (1 | ) | 13 | 105 | 150 | |||||||||||||||||||||||||||||
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|||||||||||||||||||||
Statutory earnings from in-force rate actions |
$ | 467 | $ | 397 | $ | 371 | $ | 350 | $ | 1,585 | $ | 381 | $ | 339 | $ | 333 | $ | 429 | $ | 1,482 | ||||||||||||||||||||
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|||||||||||||||||||||
(1) | Includes all implemented in-force rate actions since 2012. |
(2) | Earned premium and reserve change estimates for statutory earnings reflect certain simplifying assumptions that may vary materially from actual historical results, including but not limited to, a uniform rate of coinsurance and premium taxes in addition to consistent policyholder behavior over time. Actual behavior may differ significantly from these assumptions and these impacts exclude reserve updates. |
23
Life and Annuities Segment
24
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Adjusted Operating Income (Loss)Life and Annuities Segment
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q(1) | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
REVENUES: |
||||||||||||||||||||||||||||||||||||||||
Premiums |
$ | 47 | $ | 48 | $ | 50 | $ | 62 | $ | 207 | $ | 45 | $ | 55 | $ | 60 | $ | 74 | $ | 234 | ||||||||||||||||||||
Net investment income |
256 | 261 | 261 | 264 | 1,042 | 268 | 271 | 265 | 279 | 1,083 | ||||||||||||||||||||||||||||||
Net investment gains (losses) |
(14 | ) | (18 | ) | (7 | ) | (10 | ) | (49 | ) | (3 | ) | (15 | ) | | 14 | (4 | ) | ||||||||||||||||||||||
Policy fees and other income |
160 | 158 | 165 | 163 | 646 | 167 | 169 | 164 | 169 | 669 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
Total revenues |
449 | 449 | 469 | 479 | 1,846 | 477 | 480 | 489 | 536 | 1,982 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
BENEFITS AND EXPENSES: |
||||||||||||||||||||||||||||||||||||||||
Benefits and other changes in policy reserves |
248 | 229 | 240 | 246 | 963 | 226 | 247 | (108 | ) | 255 | 620 | |||||||||||||||||||||||||||||
Liability remeasurement (gains) losses |
228 | 12 | 9 | 17 | 266 | (12 | ) | 14 | 1 | 24 | 27 | |||||||||||||||||||||||||||||
Changes in fair value of market risk benefits and associated hedges |
14 | (24 | ) | (19 | ) | 17 | (12 | ) | (56 | ) | (27 | ) | 20 | (41 | ) | (104 | ) | |||||||||||||||||||||||
Interest credited |
124 | 127 | 126 | 126 | 503 | 125 | 128 | 126 | 125 | 504 | ||||||||||||||||||||||||||||||
Acquisition and operating expenses, net of deferrals |
55 | 54 | 51 | 53 | 213 | 54 | 57 | 416 | 77 | 604 | ||||||||||||||||||||||||||||||
Amortization of deferred acquisition costs and intangibles |
41 | 45 | 44 | 51 | 181 | 54 | 57 | 63 | 66 | 240 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
Total benefits and expenses |
710 | 443 | 451 | 510 | 2,114 | 391 | 476 | 518 | 506 | 1,891 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES |
(261 | ) | 6 | 18 | (31 | ) | (268 | ) | 86 | 4 | (29 | ) | 30 | 91 | ||||||||||||||||||||||||||
Provision (benefit) for income taxes |
(56 | ) | 1 | 3 | (7 | ) | (59 | ) | 17 | | (7 | ) | 6 | 16 | ||||||||||||||||||||||||||
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|
|||||||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS |
(205 | ) | 5 | 15 | (24 | ) | (209 | ) | 69 | 4 | (22 | ) | 24 | 75 | ||||||||||||||||||||||||||
ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS: |
||||||||||||||||||||||||||||||||||||||||
Net investment (gains) losses |
14 | 18 | 7 | 10 | 49 | 3 | 15 | | (14 | ) | 4 | |||||||||||||||||||||||||||||
Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges(2) |
13 | (26 | ) | (23 | ) | 14 | (22 | ) | (64 | ) | (32 | ) | 8 | (54 | ) | (142 | ) | |||||||||||||||||||||||
Expenses related to restructuring |
| | | | | (1 | ) | | | | (1 | ) | ||||||||||||||||||||||||||||
Pension plan termination costs |
| | | | | 2 | 6 | | | 8 | ||||||||||||||||||||||||||||||
Taxes on adjustments |
(5 | ) | | 3 | (4 | ) | (6 | ) | 14 | 1 | (1 | ) | 14 | 28 | ||||||||||||||||||||||||||
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|||||||||||||||||||||
ADJUSTED OPERATING INCOME (LOSS) |
$ | (183 | ) | $ | (3 | ) | $ | 2 | $ | (4 | ) | $ | (188 | ) | $ | 23 | $ | (6 | ) | $ | (15 | ) | $ | (30 | ) | $ | (28 | ) | ||||||||||||
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|||||||||||||||||||||
(1) In the fourth quarter of 2023, the liability remeasurement loss of $228 million was primarily driven by an unfavorable impact from cash flow assumption updates in the companys life insurance products reflecting updates to persistency and mortality assumptions. Additional information is included on page 26.
(2) Changes in fair value of market risk benefits and associated hedges were adjusted to exclude changes in reserves, attributed fees and benefit payments as reconciled below:
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Changes in fair value of market risk benefits and associated hedges |
$ | 14 | $ | (24 | ) | $ | (19 | ) | $ | 17 | $ | (12 | ) | $ | (56 | ) | $ | (27 | ) | $ | 20 | $ | (41 | ) | $ | (104 | ) | |||||||||||||
Adjustment for changes in reserves, attributed fees and benefit payments |
(1 | ) | (2 | ) | (4 | ) | (3 | ) | (10 | ) | (8 | ) | (5 | ) | (12 | ) | (13 | ) | (38 | ) | ||||||||||||||||||||
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Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges |
$ | 13 | $ | (26 | ) | $ | (23 | ) | $ | 14 | $ | (22 | ) | $ | (64 | ) | $ | (32 | ) | $ | 8 | $ | (54 | ) | $ | (142 | ) | |||||||||||||
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25
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Adjusted Operating Income (Loss)Life and Annuities SegmentLife Insurance
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q(1),(2) | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
REVENUES: |
||||||||||||||||||||||||||||||||||||||||
Premiums |
$ | 47 | $ | 48 | $ | 50 | $ | 62 | $ | 207 | $ | 45 | $ | 55 | $ | 60 | $ | 74 | $ | 234 | ||||||||||||||||||||
Net investment income |
167 | 169 | 165 | 164 | 665 | 167 | 166 | 164 | 164 | 661 | ||||||||||||||||||||||||||||||
Net investment gains (losses) |
(6 | ) | | (1 | ) | (2 | ) | (9 | ) | 1 | (7 | ) | 2 | 9 | 5 | |||||||||||||||||||||||||
Policy fees and other income |
131 | 130 | 136 | 134 | 531 | 138 | 138 | 133 | 134 | 543 | ||||||||||||||||||||||||||||||
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Total revenues |
339 | 347 | 350 | 358 | 1,394 | 351 | 352 | 359 | 381 | 1,443 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
BENEFITS AND EXPENSES: |
||||||||||||||||||||||||||||||||||||||||
Benefits and other changes in policy reserves |
207 | 184 | 197 | 199 | 787 | 181 | 197 | 217 | 203 | 798 | ||||||||||||||||||||||||||||||
Liability remeasurement (gains) losses |
229 | 22 | 7 | 18 | 276 | (10 | ) | 16 | 4 | 22 | 32 | |||||||||||||||||||||||||||||
Interest credited |
98 | 99 | 98 | 98 | 393 | 97 | 98 | 96 | 94 | 385 | ||||||||||||||||||||||||||||||
Acquisition and operating expenses, net of deferrals |
38 | 36 | 34 | 36 | 144 | 39 | 40 | 32 | 56 | 167 | ||||||||||||||||||||||||||||||
Amortization of deferred acquisition costs and intangibles |
35 | 38 | 36 | 44 | 153 | 45 | 49 | 55 | 57 | 206 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
Total benefits and expenses |
607 | 379 | 372 | 395 | 1,753 | 352 | 400 | 404 | 432 | 1,588 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES |
(268 | ) | (32 | ) | (22 | ) | (37 | ) | (359 | ) | (1 | ) | (48 | ) | (45 | ) | (51 | ) | (145 | ) | ||||||||||||||||||||
Benefit for income taxes |
(57 | ) | (7 | ) | (5 | ) | (8 | ) | (77 | ) | (1 | ) | (10 | ) | (10 | ) | (11 | ) | (32 | ) | ||||||||||||||||||||
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|||||||||||||||||||||
LOSS FROM CONTINUING OPERATIONS |
(211 | ) | (25 | ) | (17 | ) | (29 | ) | (282 | ) | | (38 | ) | (35 | ) | (40 | ) | (113 | ) | |||||||||||||||||||||
ADJUSTMENTS TO LOSS FROM CONTINUING OPERATIONS: |
||||||||||||||||||||||||||||||||||||||||
Net investment (gains) losses |
6 | | 1 | 2 | 9 | (1 | ) | 7 | (2 | ) | (9 | ) | (5 | ) | ||||||||||||||||||||||||||
Expenses related to restructuring |
| | | | | (1 | ) | | | | (1 | ) | ||||||||||||||||||||||||||||
Pension plan termination costs |
| | | | | 2 | 6 | | | 8 | ||||||||||||||||||||||||||||||
Taxes on adjustments |
(1 | ) | | (1 | ) | | (2 | ) | 1 | (3 | ) | | 2 | | ||||||||||||||||||||||||||
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|||||||||||||||||||||
ADJUSTED OPERATING INCOME (LOSS) |
$ | (206 | ) | $ | (25 | ) | $ | (17 | ) | $ | (27 | ) | $ | (275 | ) | $ | 1 | $ | (28 | ) | $ | (37 | ) | $ | (47 | ) | $ | (111 | ) | |||||||||||
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|||||||||||||||||||||
(1) In the fourth quarter of 2023, the companys life insurance products had an unfavorable impact from cash flow assumption updates of $226 million reflecting updates to its persistency and mortality assumptions. The company made an unfavorable update to its persistency assumptions particularly in certain universal life insurance products with secondary guarantees to better reflect emerging experience, consistent with others in the industry. The company also made unfavorable updates to its mortality assumption in its term universal, universal and term life insurance products to better reflect emerging experience related to more modest mortality improvement and to include an expectation that mortality will continue at elevated levels in the near term post-COVID-19. (2) Effective December 31, 2023, the company entered into a binding letter of intent with a third-party to cede, on a yearly renewable term basis, certain term and universal life insurance products. Policy fees and other income included $6 million of ceded deposits and the remeasurement loss reflected higher ceded universal life insurance reserves of $40 million. As a result, this transaction resulted in a gain of $34 million that was deferred as cost of reinsurance in benefits and other changes in policy reserves. Therefore, there was no impact to net income (loss). |
|
26
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Adjusted Operating IncomeLife and Annuities SegmentFixed Annuities
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
REVENUES: |
||||||||||||||||||||||||||||||||||||||||
Net investment income |
$ | 82 | $ | 85 | $ | 87 | $ | 91 | $ | 345 | $ | 93 | $ | 96 | $ | 93 | $ | 108 | $ | 390 | ||||||||||||||||||||
Net investment gains (losses) |
(8 | ) | (18 | ) | (5 | ) | (8 | ) | (39 | ) | (4 | ) | (7 | ) | (2 | ) | 5 | (8 | ) | |||||||||||||||||||||
Policy fees and other income |
2 | 1 | 2 | 2 | 7 | 1 | 2 | 2 | 2 | 7 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
Total revenues |
76 | 68 | 84 | 85 | 313 | 90 | 91 | 93 | 115 | 389 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
BENEFITS AND EXPENSES: |
||||||||||||||||||||||||||||||||||||||||
Benefits and other changes in policy reserves(1) |
35 | 36 | 35 | 39 | 145 | 37 | 42 | (332 | ) | 46 | (207 | ) | ||||||||||||||||||||||||||||
Liability remeasurement (gains) losses |
(1 | ) | (10 | ) | 2 | (1 | ) | (10 | ) | (2 | ) | (2 | ) | (3 | ) | 2 | (5 | ) | ||||||||||||||||||||||
Changes in fair value of market risk benefits and associated hedges |
16 | (18 | ) | (4 | ) | 8 | 2 | | (15 | ) | (12 | ) | (13 | ) | (40 | ) | ||||||||||||||||||||||||
Interest credited |
26 | 26 | 27 | 27 | 106 | 27 | 28 | 29 | 30 | 114 | ||||||||||||||||||||||||||||||
Acquisition and operating expenses, net of deferrals(1) |
8 | 9 | 7 | 8 | 32 | 7 | 7 | 372 | 9 | 395 | ||||||||||||||||||||||||||||||
Amortization of deferred acquisition costs and intangibles |
2 | 3 | 4 | 3 | 12 | 4 | 4 | 4 | 4 | 16 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
Total benefits and expenses |
86 | 46 | 71 | 84 | 287 | 73 | 64 | 58 | 78 | 273 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES |
(10 | ) | 22 | 13 | 1 | 26 | 17 | 27 | 35 | 37 | 116 | |||||||||||||||||||||||||||||
Provision (benefit) for income taxes |
(2 | ) | 5 | 3 | | 6 | 4 | 6 | 7 | 8 | 25 | |||||||||||||||||||||||||||||
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|
|||||||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS |
(8 | ) | 17 | 10 | 1 | 20 | 13 | 21 | 28 | 29 | 91 | |||||||||||||||||||||||||||||
ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS: |
||||||||||||||||||||||||||||||||||||||||
Net investment (gains) losses |
8 | 18 | 5 | 8 | 39 | 4 | 7 | 2 | (5 | ) | 8 | |||||||||||||||||||||||||||||
Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges(2) |
14 | (18 | ) | (5 | ) | 8 | (1 | ) | (3 | ) | (14 | ) | (13 | ) | (15 | ) | (45 | ) | ||||||||||||||||||||||
Taxes on adjustments |
(5 | ) | | | (3 | ) | (8 | ) | | 1 | 3 | 4 | 8 | |||||||||||||||||||||||||||
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|||||||||||||||||||||
ADJUSTED OPERATING INCOME |
$ | 9 | $ | 17 | $ | 10 | $ | 14 | $ | 50 | $ | 14 | $ | 15 | $ | 20 | $ | 13 | $ | 62 | ||||||||||||||||||||
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|||||||||||||||||||||
(1) In the second quarter of 2022, the recapture of certain single premium immediate annuity contracts by a third party reduced benefits and other changes in policy reserves by $372 million and increased acquisition and operating expenses, net of deferrals, by $365 million. (2) Changes in fair value of market risk benefits and associated hedges were adjusted to exclude changes in reserves, attributed fees and benefit payments as reconciled below:
|
| |||||||||||||||||||||||||||||||||||||||
Changes in fair value of market risk benefits and associated hedges |
$ | 16 | $ | (18 | ) | $ | (4 | ) | $ | 8 | $ | 2 | $ | | $ | (15 | ) | $ | (12 | ) | $ | (13 | ) | $ | (40 | ) | ||||||||||||||
Adjustment for changes in reserves, attributed fees and benefit payments |
(2 | ) | | (1 | ) | | (3 | ) | (3 | ) | 1 | (1 | ) | (2 | ) | (5 | ) | |||||||||||||||||||||||
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|||||||||||||||||||||
Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges |
$ | 14 | $ | (18 | ) | $ | (5 | ) | $ | 8 | $ | (1 | ) | $ | (3 | ) | $ | (14 | ) | $ | (13 | ) | $ | (15 | ) | $ | (45 | ) | ||||||||||||
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27
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Adjusted Operating IncomeLife and Annuities SegmentVariable Annuities
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
REVENUES: |
||||||||||||||||||||||||||||||||||||||||
Net investment income |
$ | 7 | $ | 7 | $ | 9 | $ | 9 | $ | 32 | $ | 8 | $ | 9 | $ | 8 | $ | 7 | $ | 32 | ||||||||||||||||||||
Net investment gains (losses) |
| | (1 | ) | | (1 | ) | | (1 | ) | | | (1 | ) | ||||||||||||||||||||||||||
Policy fees and other income |
27 | 27 | 27 | 27 | 108 | 28 | 29 | 29 | 33 | 119 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
Total revenues |
34 | 34 | 35 | 36 | 139 | 36 | 37 | 37 | 40 | 150 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
BENEFITS AND EXPENSES: |
||||||||||||||||||||||||||||||||||||||||
Benefits and other changes in policy reserves |
6 | 9 | 8 | 8 | 31 | 8 | 8 | 7 | 6 | 29 | ||||||||||||||||||||||||||||||
Changes in fair value of market risk benefits and associated hedges |
(2 | ) | (6 | ) | (15 | ) | 9 | (14 | ) | (56 | ) | (12 | ) | 32 | (28 | ) | (64 | ) | ||||||||||||||||||||||
Interest credited |
| 2 | 1 | 1 | 4 | 1 | 2 | 1 | 1 | 5 | ||||||||||||||||||||||||||||||
Acquisition and operating expenses, net of deferrals |
9 | 9 | 10 | 9 | 37 | 8 | 10 | 12 | 12 | 42 | ||||||||||||||||||||||||||||||
Amortization of deferred acquisition costs and intangibles |
4 | 4 | 4 | 4 | 16 | 5 | 4 | 4 | 5 | 18 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
Total benefits and expenses |
17 | 18 | 8 | 31 | 74 | (34 | ) | 12 | 56 | (4 | ) | 30 | ||||||||||||||||||||||||||||
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|||||||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES |
17 | 16 | 27 | 5 | 65 | 70 | 25 | (19 | ) | 44 | 120 | |||||||||||||||||||||||||||||
Provision (benefit) for income taxes |
3 | 3 | 5 | 1 | 12 | 14 | 4 | (4 | ) | 9 | 23 | |||||||||||||||||||||||||||||
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|||||||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS |
14 | 13 | 22 | 4 | 53 | 56 | 21 | (15 | ) | 35 | 97 | |||||||||||||||||||||||||||||
ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS: |
||||||||||||||||||||||||||||||||||||||||
Net investment (gains) losses |
| | 1 | | 1 | | 1 | | | 1 | ||||||||||||||||||||||||||||||
Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges(1) |
(1 | ) | (8 | ) | (18 | ) | 6 | (21 | ) | (61 | ) | (18 | ) | 21 | (39 | ) | (97 | ) | ||||||||||||||||||||||
Taxes on adjustments |
1 | | 4 | (1 | ) | 4 | 13 | 3 | (4 | ) | 8 | 20 | ||||||||||||||||||||||||||||
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|||||||||||||||||||||
ADJUSTED OPERATING INCOME |
$ | 14 | $ | 5 | $ | 9 | $ | 9 | $ | 37 | $ | 8 | $ | 7 | $ | 2 | $ | 4 | $ | 21 | ||||||||||||||||||||
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|||||||||||||||||||||
(1) Changes in fair value of market risk benefits and associated hedges were adjusted to exclude changes in reserves, attributed fees and benefit payments as reconciled below: |
|
|||||||||||||||||||||||||||||||||||||||
Changes in fair value of market risk benefits and associated hedges |
$ | (2 | ) | $ | (6 | ) | $ | (15 | ) | $ | 9 | $ | (14 | ) | $ | (56 | ) | $ | (12 | ) | $ | 32 | $ | (28 | ) | $ | (64 | ) | ||||||||||||
Adjustment for changes in reserves, attributed fees and benefit payments |
1 | (2 | ) | (3 | ) | (3 | ) | (7 | ) | (5 | ) | (6 | ) | (11 | ) | (11 | ) | (33 | ) | |||||||||||||||||||||
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|||||||||||||||||||||
Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges |
$ | (1 | ) | $ | (8 | ) | $ | (18 | ) | $ | 6 | $ | (21 | ) | $ | (61 | ) | $ | (18 | ) | $ | 21 | $ | (39 | ) | $ | (97 | ) | ||||||||||||
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28
Corporate and Other
29
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Adjusted Operating LossCorporate and Other(1)
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
REVENUES: |
||||||||||||||||||||||||||||||||||||||||
Premiums |
$ | 2 | $ | 3 | $ | 2 | $ | 2 | $ | 9 | $ | 1 | $ | 2 | $ | 1 | $ | 2 | $ | 6 | ||||||||||||||||||||
Net investment income |
8 | 3 | 4 | 4 | 19 | 4 | 1 | | 3 | 8 | ||||||||||||||||||||||||||||||
Net investment gains (losses) |
(11 | ) | (4 | ) | (3 | ) | (10 | ) | (28 | ) | (21 | ) | 4 | 15 | (13 | ) | (15 | ) | ||||||||||||||||||||||
Policy fees and other income |
(1 | ) | (1 | ) | | | (2 | ) | | (1 | ) | 1 | | | ||||||||||||||||||||||||||
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Total revenues |
(2 | ) | 1 | 3 | (4 | ) | (2 | ) | (16 | ) | 6 | 17 | (8 | ) | (1 | ) | ||||||||||||||||||||||||
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BENEFITS AND EXPENSES: |
||||||||||||||||||||||||||||||||||||||||
Benefits and other changes in policy reserves |
(3 | ) | (1 | ) | (2 | ) | (3 | ) | (9 | ) | | (4 | ) | (4 | ) | (3 | ) | (11 | ) | |||||||||||||||||||||
Acquisition and operating expenses, net of deferrals |
21 | 13 | 15 | 16 | 65 | 11 | 11 | 10 | 9 | 41 | ||||||||||||||||||||||||||||||
Amortization of deferred acquisition costs and intangibles |
1 | | | | 1 | | | | | | ||||||||||||||||||||||||||||||
Interest expense |
17 | 17 | 16 | 16 | 66 | 14 | 14 | 13 | 13 | 54 | ||||||||||||||||||||||||||||||
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Total benefits and expenses |
36 | 29 | 29 | 29 | 123 | 25 | 21 | 19 | 19 | 84 | ||||||||||||||||||||||||||||||
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LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES |
(38 | ) | (28 | ) | (26 | ) | (33 | ) | (125 | ) | (41 | ) | (15 | ) | (2 | ) | (27 | ) | (85 | ) | ||||||||||||||||||||
Provision (benefit) for income taxes |
(5 | ) | (6 | ) | (4 | ) | (5 | ) | (20 | ) | (16 | ) | 2 | 3 | (5 | ) | (16 | ) | ||||||||||||||||||||||
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LOSS FROM CONTINUING OPERATIONS |
(33 | ) | (22 | ) | (22 | ) | (28 | ) | (105 | ) | (25 | ) | (17 | ) | (5 | ) | (22 | ) | (69 | ) | ||||||||||||||||||||
ADJUSTMENTS TO LOSS FROM CONTINUING OPERATIONS: |
||||||||||||||||||||||||||||||||||||||||
Net investment (gains) losses |
11 | 4 | 3 | 10 | 28 | 21 | (4 | ) | (15 | ) | 13 | 15 | ||||||||||||||||||||||||||||
(Gains) losses on early extinguishment of debt |
(1 | ) | | | (1 | ) | (2 | ) | (1 | ) | 3 | 1 | 3 | 6 | ||||||||||||||||||||||||||
Expenses related to restructuring |
| | | 4 | 4 | 1 | | | | 1 | ||||||||||||||||||||||||||||||
Taxes on adjustments |
(2 | ) | | (1 | ) | (3 | ) | (6 | ) | (5 | ) | | 3 | (3 | ) | (5 | ) | |||||||||||||||||||||||
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ADJUSTED OPERATING LOSS |
$ | (25 | ) | $ | (18 | ) | $ | (20 | ) | $ | (18 | ) | $ | (81 | ) | $ | (9 | ) | $ | (18 | ) | $ | (16 | ) | $ | (9 | ) | $ | (52 | ) | ||||||||||
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(1) | Includes inter-segment eliminations and the results of other businesses, including start-up growth initiatives and certain international businesses, that are managed outside the operating segments. |
30
Additional Financial Data
31
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
(amounts in millions)
December 31, 2023 | September 30, 2023 | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||||||||
Carrying Amount |
% of Total |
Carrying Amount |
% of Total |
Carrying Amount |
% of Total |
Carrying Amount |
% of Total |
Carrying Amount |
% of Total |
|||||||||||||||||||||||||||||||||
Composition of Investment Portfolio |
||||||||||||||||||||||||||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||||||||||||||||||||||||
Investment grade: |
||||||||||||||||||||||||||||||||||||||||||
Public fixed maturity securities |
$ | 27,302 | 43 | % | $ | 25,148 | 42 | % | $ | 26,413 | 43 | % | $ | 26,894 | 44 | % | $ | 26,047 | 43 | % | ||||||||||||||||||||||
Private fixed maturity securities |
11,016 | 18 | 10,432 | 17 | 10,808 | 18 | 11,182 | 18 | 11,126 | 19 | ||||||||||||||||||||||||||||||||
Residential mortgage-backed securities(1) |
907 | 1 | 891 | 2 | 935 | 1 | 986 | 2 | 995 | 2 | ||||||||||||||||||||||||||||||||
Commercial mortgage-backed securities |
1,413 | 2 | 1,495 | 3 | 1,674 | 3 | 1,814 | 3 | 1,900 | 3 | ||||||||||||||||||||||||||||||||
Other asset-backed securities |
2,199 | 4 | 2,163 | 4 | 2,164 | 4 | 2,113 | 3 | 2,117 | 3 | ||||||||||||||||||||||||||||||||
State and political subdivisions |
2,302 | 4 | 2,164 | 4 | 2,343 | 4 | 2,403 | 4 | 2,399 | 4 | ||||||||||||||||||||||||||||||||
Non-investment grade fixed maturity securities |
1,642 | 3 | 1,675 | 3 | 1,733 | 3 | 1,989 | 3 | 1,999 | 3 | ||||||||||||||||||||||||||||||||
Equity securities: |
||||||||||||||||||||||||||||||||||||||||||
Common stocks and mutual funds |
347 | 1 | 316 | 1 | 326 | 1 | 306 | 1 | 258 | 1 | ||||||||||||||||||||||||||||||||
Preferred stocks |
49 | | 47 | | 52 | | 58 | | 61 | | ||||||||||||||||||||||||||||||||
Commercial mortgage loans, net |
6,802 | 10 | 6,793 | 11 | 6,852 | 11 | 6,891 | 11 | 7,010 | 11 | ||||||||||||||||||||||||||||||||
Policy loans |
2,220 | 4 | 2,233 | 4 | 2,270 | 4 | 2,133 | 3 | 2,139 | 3 | ||||||||||||||||||||||||||||||||
Limited partnerships |
2,821 | 5 | 2,699 | 5 | 2,585 | 4 | 2,456 | 4 | 2,331 | 4 | ||||||||||||||||||||||||||||||||
Cash, cash equivalents, restricted cash and short-term investments |
2,242 | 4 | 2,023 | 3 | 2,196 | 3 | 1,759 | 3 | 1,802 | 3 | ||||||||||||||||||||||||||||||||
Other invested assets: |
Derivatives: | |||||||||||||||||||||||||||||||||||||||||
Interest rate swaps |
55 | | 12 | | 30 | | 42 | | 24 | | ||||||||||||||||||||||||||||||||
Foreign currency swaps |
10 | | 15 | | 16 | | 17 | | 20 | | ||||||||||||||||||||||||||||||||
Equity index options |
15 | | 11 | | 15 | | 10 | | 6 | | ||||||||||||||||||||||||||||||||
Forward bond purchase commitments |
51 | | | | | | | | | | ||||||||||||||||||||||||||||||||
Other |
573 | 1 | 577 | 1 | 564 | 1 | 541 | 1 | 513 | 1 | ||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||
Total invested assets and cash |
$ | 61,966 | 100 | % | $ | 58,694 | 100 | % | $ | 60,976 | 100 | % | $ | 61,594 | 100 | % | $ | 60,747 | 100 | % | ||||||||||||||||||||||
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Public Fixed Maturity SecuritiesCredit Quality: |
||||||||||||||||||||||||||||||||||||||||||
NRSRO(2) Designation |
||||||||||||||||||||||||||||||||||||||||||
AAA |
$ | 2,559 | 8 | % | $ | 2,533 | 8 | % | $ | 5,936 | 19 | % | $ | 6,112 | 19 | % | $ | 6,067 | 19 | % | ||||||||||||||||||||||
AA |
6,170 | 19 | 5,650 | 19 | 2,896 | 9 | 2,872 | 9 | 2,859 | 9 | ||||||||||||||||||||||||||||||||
A |
9,287 | 29 | 8,359 | 28 | 8,597 | 27 | 8,699 | 27 | 8,398 | 27 | ||||||||||||||||||||||||||||||||
BBB |
13,645 | 42 | 12,923 | 43 | 13,649 | 43 | 14,056 | 43 | 13,623 | 43 | ||||||||||||||||||||||||||||||||
BB |
498 | 2 | 519 | 2 | 564 | 2 | 786 | 2 | 776 | 2 | ||||||||||||||||||||||||||||||||
B |
30 | | 20 | | 23 | | 41 | | 34 | | ||||||||||||||||||||||||||||||||
CCC and lower |
| | | | | | | | | | ||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||
Total public fixed maturity securities |
$ | 32,189 | 100 | % | $ | 30,004 | 100 | % | $ | 31,665 | 100 | % | $ | 32,566 | 100 | % | $ | 31,757 | 100 | % | ||||||||||||||||||||||
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Private Fixed Maturity SecuritiesCredit Quality: |
||||||||||||||||||||||||||||||||||||||||||
NRSRO(2) Designation |
||||||||||||||||||||||||||||||||||||||||||
AAA |
$ | 832 | 6 | % | $ | 867 | 6 | % | $ | 863 | 6 | % | $ | 860 | 6 | % | $ | 825 | 6 | % | ||||||||||||||||||||||
AA |
1,477 | 10 | 1,352 | 10 | 1,416 | 10 | 1,422 | 10 | 1,421 | 10 | ||||||||||||||||||||||||||||||||
A |
4,043 | 28 | 3,960 | 28 | 4,135 | 29 | 4,217 | 28 | 4,170 | 28 | ||||||||||||||||||||||||||||||||
BBB |
7,126 | 48 | 6,649 | 48 | 6,845 | 47 | 7,154 | 48 | 7,221 | 48 | ||||||||||||||||||||||||||||||||
BB |
975 | 7 | 993 | 7 | 1,016 | 7 | 1,012 | 7 | 1,076 | 7 | ||||||||||||||||||||||||||||||||
B |
117 | 1 | 121 | 1 | 122 | 1 | 150 | 1 | 113 | 1 | ||||||||||||||||||||||||||||||||
CCC and lower |
7 | | 7 | | 8 | | | | | | ||||||||||||||||||||||||||||||||
Not rated |
15 | | 15 | | | | | | | | ||||||||||||||||||||||||||||||||
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|
|||||||||||||||||||||||
Total private fixed maturity securities |
$ | 14,592 | 100 | % | $ | 13,964 | 100 | % | $ | 14,405 | 100 | % | $ | 14,815 | 100 | % | $ | 14,826 | 100 | % | ||||||||||||||||||||||
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|||||||||||||||||||||||
(1) | The company does not have any material exposure to residential mortgage-backed securities collateralized debt obligations (CDOs). |
(2) | Nationally Recognized Statistical Rating Organizations. |
32
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Fixed Maturity Securities Summary
(amounts in millions)
December 31, 2023 | September 30, 2023 | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||||||
Fair Value |
% of Total |
Fair Value |
% of Total |
Fair Value |
% of Total |
Fair Value |
% of Total |
Fair Value |
% of Total |
|||||||||||||||||||||||||||||||
Fixed Maturity Securities - Security Sector: |
||||||||||||||||||||||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises |
$ | 3,494 | 7 | % | $ | 3,112 | 7 | % | $ | 3,389 | 7 | % | $ | 3,441 | 7 | % | $ | 3,341 | 7 | % | ||||||||||||||||||||
State and political subdivisions |
2,302 | 5 | 2,164 | 5 | 2,343 | 5 | 2,403 | 5 | 2,399 | 5 | ||||||||||||||||||||||||||||||
Foreign government |
626 | 1 | 583 | 1 | 625 | 1 | 630 | 1 | 645 | 1 | ||||||||||||||||||||||||||||||
U.S. corporate |
27,985 | 60 | 25,956 | 60 | 27,043 | 59 | 27,872 | 59 | 27,119 | 59 | ||||||||||||||||||||||||||||||
Foreign corporate |
7,811 | 17 | 7,554 | 17 | 7,838 | 17 | 8,059 | 17 | 8,010 | 17 | ||||||||||||||||||||||||||||||
Residential mortgage-backed securities |
907 | 2 | 891 | 2 | 934 | 2 | 985 | 2 | 995 | 2 | ||||||||||||||||||||||||||||||
Commercial mortgage-backed securities |
1,418 | 3 | 1,503 | 3 | 1,690 | 4 | 1,831 | 4 | 1,908 | 4 | ||||||||||||||||||||||||||||||
Other asset-backed securities |
2,238 | 5 | 2,205 | 5 | 2,208 | 5 | 2,160 | 5 | 2,166 | 5 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
Total fixed maturity securities |
$ | 46,781 | 100 | % | $ | 43,968 | 100 | % | $ | 46,070 | 100 | % | $ | 47,381 | 100 | % | $ | 46,583 | 100 | % | ||||||||||||||||||||
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|||||||||||||||||||||
Corporate Bond Holdings - Industry Sector: |
||||||||||||||||||||||||||||||||||||||||
Investment Grade: |
||||||||||||||||||||||||||||||||||||||||
Finance and insurance |
$ | 9,045 | 25 | % | $ | 8,541 | 26 | % | $ | 8,871 | 26 | % | $ | 9,149 | 26 | % | $ | 8,986 | 26 | % | ||||||||||||||||||||
Utilities |
4,904 | 14 | 4,503 | 13 | 4,653 | 14 | 4,788 | 13 | 4,591 | 13 | ||||||||||||||||||||||||||||||
Energy |
3,181 | 9 | 2,967 | 9 | 3,022 | 9 | 2,882 | 8 | 2,813 | 8 | ||||||||||||||||||||||||||||||
Consumer - non-cyclical |
4,979 | 14 | 4,573 | 14 | 4,863 | 14 | 4,998 | 14 | 4,872 | 14 | ||||||||||||||||||||||||||||||
Consumer - cyclical |
1,659 | 5 | 1,497 | 4 | 1,558 | 4 | 1,602 | 4 | 1,594 | 5 | ||||||||||||||||||||||||||||||
Capital goods |
2,593 | 7 | 2,406 | 7 | 2,490 | 7 | 2,554 | 7 | 2,517 | 7 | ||||||||||||||||||||||||||||||
Industrial |
1,869 | 5 | 1,773 | 5 | 1,857 | 5 | 1,944 | 6 | 1,863 | 5 | ||||||||||||||||||||||||||||||
Technology and communications |
3,686 | 10 | 3,422 | 10 | 3,599 | 10 | 3,713 | 10 | 3,564 | 10 | ||||||||||||||||||||||||||||||
Transportation |
1,498 | 4 | 1,371 | 4 | 1,428 | 4 | 1,459 | 4 | 1,439 | 4 | ||||||||||||||||||||||||||||||
Other |
895 | 3 | 933 | 3 | 973 | 3 | 1,022 | 3 | 1,048 | 3 | ||||||||||||||||||||||||||||||
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|
|||||||||||||||||||||
Subtotal |
34,309 | 96 | 31,986 | 95 | 33,314 | 96 | 34,111 | 95 | 33,287 | 95 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
Non-Investment Grade: |
||||||||||||||||||||||||||||||||||||||||
Finance and insurance |
181 | 1 | 176 | 1 | 154 | | 164 | 1 | 153 | 1 | ||||||||||||||||||||||||||||||
Utilities |
54 | | 72 | | 46 | | 47 | | 47 | | ||||||||||||||||||||||||||||||
Energy |
218 | 1 | 218 | 1 | 228 | 1 | 407 | 1 | 409 | 1 | ||||||||||||||||||||||||||||||
Consumer - non-cyclical |
142 | | 135 | | 139 | | 150 | | 151 | | ||||||||||||||||||||||||||||||
Consumer - cyclical |
211 | 1 | 262 | 1 | 273 | 1 | 291 | 1 | 299 | 1 | ||||||||||||||||||||||||||||||
Capital goods |
149 | | 157 | 1 | 172 | 1 | 178 | 1 | 167 | 1 | ||||||||||||||||||||||||||||||
Industrial |
161 | | 145 | | 149 | | 155 | | 152 | | ||||||||||||||||||||||||||||||
Technology and communications |
228 | 1 | 212 | 1 | 226 | 1 | 247 | 1 | 277 | 1 | ||||||||||||||||||||||||||||||
Transportation |
28 | | 29 | | 35 | | 37 | | 36 | | ||||||||||||||||||||||||||||||
Other |
115 | | 118 | | 145 | | 144 | | 151 | | ||||||||||||||||||||||||||||||
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|
|||||||||||||||||||||
Subtotal |
1,487 | 4 | 1,524 | 5 | 1,567 | 4 | 1,820 | 5 | 1,842 | 5 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
Total |
$ | 35,796 | 100 | % | $ | 33,510 | 100 | % | $ | 34,881 | 100 | % | $ | 35,931 | 100 | % | $ | 35,129 | 100 | % | ||||||||||||||||||||
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|||||||||||||||||||||
Fixed Maturity Securities - Contractual Maturity Dates: |
||||||||||||||||||||||||||||||||||||||||
Due in one year or less |
$ | 1,372 | 3 | % | $ | 1,426 | 3 | % | $ | 1,375 | 3 | % | $ | 1,328 | 3 | % | $ | 1,234 | 3 | % | ||||||||||||||||||||
Due after one year through five years |
8,205 | 18 | 8,115 | 18 | 8,000 | 17 | 8,245 | 17 | 7,931 | 17 | ||||||||||||||||||||||||||||||
Due after five years through ten years |
12,114 | 26 | 11,368 | 26 | 11,662 | 25 | 11,746 | 25 | 11,915 | 26 | ||||||||||||||||||||||||||||||
Due after ten years |
20,527 | 43 | 18,460 | 43 | 20,201 | 44 | 21,086 | 44 | 20,434 | 43 | ||||||||||||||||||||||||||||||
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|
|||||||||||||||||||||
Subtotal |
42,218 | 90 | 39,369 | 90 | 41,238 | 89 | 42,405 | 89 | 41,514 | 89 | ||||||||||||||||||||||||||||||
Mortgage and asset-backed securities |
4,563 | 10 | 4,599 | 10 | 4,832 | 11 | 4,976 | 11 | 5,069 | 11 | ||||||||||||||||||||||||||||||
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|
|||||||||||||||||||||
Total fixed maturity securities |
$ | 46,781 | 100 | % | $ | 43,968 | 100 | % | $ | 46,070 | 100 | % | $ | 47,381 | 100 | % | $ | 46,583 | 100 | % | ||||||||||||||||||||
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|||||||||||||||||||||
33
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
U.S. GAAP Net Investment Income Yields
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
U.S. GAAP Net Investment Income |
||||||||||||||||||||||||||||||||||||||||
Fixed maturity securities - taxable |
$ | 557 | $ | 559 | $ | 567 | $ | 561 | $ | 2,244 | $ | 562 | $ | 576 | $ | 578 | $ | 580 | $ | 2,296 | ||||||||||||||||||||
Fixed maturity securities - non-taxable |
| 1 | 1 | 1 | 3 | 1 | 2 | 1 | 1 | 5 | ||||||||||||||||||||||||||||||
Equity securities |
5 | 1 | 3 | 2 | 11 | 3 | 3 | 2 | 2 | 10 | ||||||||||||||||||||||||||||||
Commercial mortgage loans |
75 | 76 | 75 | 76 | 302 | 81 | 81 | 78 | 81 | 321 | ||||||||||||||||||||||||||||||
Policy loans |
57 | 58 | 54 | 55 | 224 | 55 | 55 | 51 | 50 | 211 | ||||||||||||||||||||||||||||||
Limited partnerships |
41 | 31 | 17 | 28 | 117 | 22 | 38 | 32 | 7 | 99 | ||||||||||||||||||||||||||||||
Other invested assets |
72 | 69 | 70 | 68 | 279 | 71 | 67 | 66 | 63 | 267 | ||||||||||||||||||||||||||||||
Cash, cash equivalents, restricted cash and short-term investments |
27 | 28 | 22 | 18 | 95 | 12 | 7 | 1 | | 20 | ||||||||||||||||||||||||||||||
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Gross investment income before expenses and fees |
834 | 823 | 809 | 809 | 3,275 | 807 | 829 | 809 | 784 | 3,229 | ||||||||||||||||||||||||||||||
Expenses and fees |
(24 | ) | (22 | ) | (24 | ) | (22 | ) | (92 | ) | (20 | ) | (21 | ) | (22 | ) | (20 | ) | (83 | ) | ||||||||||||||||||||
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Net investment income |
$ | 810 | $ | 801 | $ | 785 | $ | 787 | $ | 3,183 | $ | 787 | $ | 808 | $ | 787 | $ | 764 | $ | 3,146 | ||||||||||||||||||||
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Annualized Yields |
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Fixed maturity securities - taxable |
4.5 | % | 4.5 | % | 4.5 | % | 4.4 | % | 4.5 | % | 4.4 | % | 4.5 | % | 4.5 | % | 4.4 | % | 4.5 | % | ||||||||||||||||||||
Fixed maturity securities - non-taxable |
| % | 5.6 | % | 4.9 | % | 4.6 | % | 4.2 | % | 4.0 | % | 7.1 | % | 3.6 | % | 3.6 | % | 4.7 | % | ||||||||||||||||||||
Equity securities |
5.3 | % | 1.1 | % | 3.2 | % | 2.3 | % | 3.0 | % | 4.0 | % | 4.6 | % | 3.4 | % | 3.7 | % | 4.0 | % | ||||||||||||||||||||
Commercial mortgage loans |
4.4 | % | 4.5 | % | 4.4 | % | 4.4 | % | 4.4 | % | 4.6 | % | 4.6 | % | 4.5 | % | 4.7 | % | 4.6 | % | ||||||||||||||||||||
Policy loans |
10.2 | % | 10.3 | % | 9.8 | % | 10.3 | % | 10.2 | % | 10.3 | % | 10.2 | % | 9.7 | % | 9.8 | % | 10.0 | % | ||||||||||||||||||||
Limited partnerships(1) |
5.9 | % | 4.7 | % | 2.7 | % | 4.7 | % | 4.5 | % | 3.9 | % | 7.0 | % | 6.2 | % | 1.4 | % | 4.7 | % | ||||||||||||||||||||
Other invested assets(2) |
50.1 | % | 48.3 | % | 50.7 | % | 51.6 | % | 50.5 | % | 56.6 | % | 57.0 | % | 62.6 | % | 64.8 | % | 59.9 | % | ||||||||||||||||||||
Cash, cash equivalents, restricted cash and short-term investments |
5.1 | % | 5.3 | % | 4.5 | % | 4.0 | % | 4.7 | % | 2.9 | % | 1.7 | % | 0.3 | % | | % | 1.2 | % | ||||||||||||||||||||
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Gross investment income before expenses and fees |
5.2 | % | 5.1 | % | 5.0 | % | 5.0 | % | 5.1 | % | 5.0 | % | 5.1 | % | 4.9 | % | 4.8 | % | 5.0 | % | ||||||||||||||||||||
Expenses and fees |
(0.2 | )% | (0.1 | )% | (0.1 | )% | (0.1 | )% | (0.2 | )% | (0.2 | )% | (0.1 | )% | (0.1 | )% | (0.1 | )% | (0.2 | )% | ||||||||||||||||||||
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Net investment income |
5.0 | % | 5.0 | % | 4.9 | % | 4.9 | % | 4.9 | % | 4.8 | % | 5.0 | % | 4.8 | % | 4.7 | % | 4.8 | % | ||||||||||||||||||||
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Yields are based on net investment income as reported under U.S. GAAP and are consistent with how the company measures its investment performance for management purposes. Yields are annualized, for interim periods, and are calculated as net investment income as a percentage of average quarterly asset carrying values except for fixed maturity securities, derivatives and derivative counterparty collateral, which exclude unrealized fair value adjustments. See page 39 herein for average invested assets and cash used in the yield calculation.
(1) | Limited partnership investments are primarily equity-based and do not have fixed returns by period. |
(2) | Investment income for other invested assets includes amortization of terminated cash flow hedges, which have no corresponding book value within the yield calculation. |
34
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Net Investment Gains (Losses)Detail
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | |||||||||||||||||||||||||||||||
Realized investment gains (losses): |
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Net realized gains (losses) on available-for-sale securities: |
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Fixed maturity securities: |
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U.S. corporate |
$ | (15 | ) | $ | (5 | ) | $ | (39 | ) | $ | (8 | ) | $ | (67 | ) | $ | (25 | ) | $ | (23 | ) | $ | (2 | ) | $ | (12 | ) | $ | (62 | ) | ||||||||||
U.S. government, agencies and government-sponsored enterprises |
(30 | ) | 2 | 1 | 1 | (26 | ) | | 9 | | 6 | 15 | ||||||||||||||||||||||||||||
Foreign corporate |
(5 | ) | (3 | ) | 1 | (3 | ) | (10 | ) | (6 | ) | (7 | ) | (1 | ) | (2 | ) | (16 | ) | |||||||||||||||||||||
Foreign government |
| | | (1 | ) | (1 | ) | | | | | | ||||||||||||||||||||||||||||
Mortgage-backed securities |
(18 | ) | (5 | ) | (2 | ) | (5 | ) | (30 | ) | (4 | ) | (5 | ) | (1 | ) | | (10 | ) | |||||||||||||||||||||
Asset-backed securities |
| | 9 | | 9 | | (1 | ) | | | (1 | ) | ||||||||||||||||||||||||||||
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Total net realized gains (losses) on available-for-sale securities |
(68 | ) | (11 | ) | (30 | ) | (16 | ) | (125 | ) | (35 | ) | (27 | ) | (4 | ) | (8 | ) | (74 | ) | ||||||||||||||||||||
Net realized gains (losses) on equity securities sold |
| | (1 | ) | | (1 | ) | | | | | | ||||||||||||||||||||||||||||
Net realized gains (losses) on limited partnerships |
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Total net realized investment gains (losses) |
(68 | ) | (11 | ) | (31 | ) | (16 | ) | (126 | ) | (35 | ) | (27 | ) | (4 | ) | (8 | ) | (74 | ) | ||||||||||||||||||||
Net change in allowance for credit losses on available-for-sale fixed maturity securities |
(1 | ) | (2 | ) | 11 | (15 | ) | (7 | ) | | | | | | ||||||||||||||||||||||||||
Write-down of available-for-sale fixed maturity securities |
| | (1 | ) | | (1 | ) | | | | (2 | ) | (2 | ) | ||||||||||||||||||||||||||
Net unrealized gains (losses) on equity securities still held |
33 | (12 | ) | 21 | 11 | 53 | 11 | (14 | ) | (26 | ) | (6 | ) | (35 | ) | |||||||||||||||||||||||||
Net unrealized gains (losses) on limited partnerships |
57 | 14 | 40 | | 111 | 36 | (24 | ) | 24 | 35 | 71 | |||||||||||||||||||||||||||||
Commercial mortgage loans |
(2 | ) | (1 | ) | | (2 | ) | (5 | ) | 1 | | 2 | 1 | 4 | ||||||||||||||||||||||||||
Derivative instruments |
24 | (28 | ) | (1 | ) | 12 | 7 | (12 | ) | 7 | 18 | 19 | 32 | |||||||||||||||||||||||||||
Other |
(5 | ) | (3 | ) | | (1 | ) | (9 | ) | (6 | ) | | 5 | 3 | 2 | |||||||||||||||||||||||||
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Net investment gains (losses), gross |
38 | (43 | ) | 39 | (11 | ) | 23 | (5 | ) | (58 | ) | 19 | 42 | (2 | ) | |||||||||||||||||||||||||
Adjustment for net investment (gains) losses attributable to noncontrolling interests |
| | 2 | | 2 | | | | | | ||||||||||||||||||||||||||||||
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Net investment gains (losses), net |
$ | 38 | $ | (43 | ) | $ | 41 | $ | (11 | ) | $ | 25 | $ | (5 | ) | $ | (58 | ) | $ | 19 | $ | 42 | $ | (2 | ) | |||||||||||||||
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35
Reconciliations of Non-GAAP Measures
36
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Reconciliation of Operating ROE
(amounts in millions)
Quarterly Average ROE |
Three months ended | |||||||||||||||||||
U.S. GAAP Basis ROE | December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
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Net income (loss) available to Genworth Financial, Inc.s common stockholders for the period ended(1) |
$ | (212 | ) | $ | 29 | $ | 137 | $ | 122 | $ | 381 | |||||||||
Quarterly average Genworth Financial, Inc.s stockholders equity for the period, excluding accumulated other comprehensive income (loss)(2) |
$ | 10,156 | $ | 10,299 | $ | 10,307 | $ | 10,269 | $ | 10,069 | ||||||||||
Annualized U.S. GAAP Quarterly Basis ROE(1)/(2) |
(8.4 | )% | 1.1 | % | 5.3 | % | 4.8 | % | 15.1 | % | ||||||||||
Operating ROE |
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Adjusted operating income (loss) for the period ended(1) |
$ | (230 | ) | $ | 42 | $ | 85 | $ | 144 | $ | 338 | |||||||||
Quarterly average Genworth Financial, Inc.s stockholders equity for the period, excluding accumulated other comprehensive income (loss)(2) |
$ | 10,156 | $ | 10,299 | $ | 10,307 | $ | 10,269 | $ | 10,069 | ||||||||||
Annualized Operating Quarterly Basis ROE(1)/(2) |
(9.1 | )% | 1.6 | % | 3.3 | % | 5.6 | % | 13.4 | % |
Non-GAAP Definition for Operating ROE
The company references the non-GAAP financial measure entitled operating return on equity or operating ROE. The company defines operating ROE as adjusted operating income (loss) divided by average ending Genworth Financial, Inc.s stockholders equity, excluding accumulated other comprehensive income (loss) over two consecutive quarters. Management believes that analysis of operating ROE enhances understanding of the efficiency with which the company deploys its capital. However, operating ROE is not a substitute for net income (loss) available to Genworth Financial, Inc.s common stockholders divided by average ending Genworth Financial, Inc.s stockholders equity determined in accordance with U.S. GAAP.
(1) | Net income (loss) available to Genworth Financial, Inc.s common stockholders and adjusted operating income (loss) from page 9 herein. |
(2) | Quarterly average Genworth Financial, Inc.s stockholders equity, excluding accumulated other comprehensive income (loss), is derived by averaging ending Genworth Financial, Inc.s stockholders equity, excluding accumulated other comprehensive income (loss) over two consecutive quarters. |
37
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Reconciliation of Consolidated Expense Ratio
(amounts in millions)
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||||
GAAP Basis Expense Ratio | 4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | ||||||||||||||||||||||||||||||||
(A) |
Acquisition and operating expenses, net of deferrals | $ | 248 | $ | 228 | $ | 226 | $ | 240 | $ | 942 | $ | 225 | $ | 245 | $ | 579 | $ | 236 | $ | 1,285 | |||||||||||||||||||||
(B) |
Premiums | $ | 904 | $ | 915 | $ | 902 | $ | 915 | $ | 3,636 | $ | 918 | $ | 929 | $ | 916 | $ | 917 | $ | 3,680 | |||||||||||||||||||||
(A) / (B) |
GAAP Basis Expense Ratio | 27 | % | 25 | % | 25 | % | 26 | % | 26 | % | 25 | % | 26 | % | 63 | % | 26 | % | 35 | % | |||||||||||||||||||||
Adjusted Expense Ratio | ||||||||||||||||||||||||||||||||||||||||||
Acquisition and operating expenses, net of deferrals | $ | 248 | $ | 228 | $ | 226 | $ | 240 | $ | 942 | $ | 225 | $ | 245 | $ | 579 | $ | 236 | $ | 1,285 | ||||||||||||||||||||||
Less: Reinsurance recapture payment(1) | | | | | | | | 365 | | 365 | ||||||||||||||||||||||||||||||||
Less: Legal settlement expenses(2) | | | 1 | 13 | 14 | | 20 | | | 20 | ||||||||||||||||||||||||||||||||
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(C) |
Adjusted acquisition and operating expenses, net of deferrals | $ | 248 | $ | 228 | $ | 225 | $ | 227 | $ | 928 | $ | 225 | $ | 225 | $ | 214 | $ | 236 | $ | 900 | |||||||||||||||||||||
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Premiums | $ | 904 | $ | 915 | $ | 902 | $ | 915 | $ | 3,636 | $ | 918 | $ | 929 | $ | 916 | $ | 917 | $ | 3,680 | ||||||||||||||||||||||
Add: Policy fees and other income | 159 | 158 | 166 | 163 | 646 | 167 | 169 | 165 | 170 | 671 | ||||||||||||||||||||||||||||||||
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(D) |
Adjusted revenues | $ | 1,063 | $ | 1,073 | $ | 1,068 | $ | 1,078 | $ | 4,282 | $ | 1,085 | $ | 1,098 | $ | 1,081 | $ | 1,087 | $ | 4,351 | |||||||||||||||||||||
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(C) / (D) |
Adjusted expense ratio(3) | 23 | % | 21 | % | 21 | % | 21 | % | 22 | % | 21 | % | 20 | % | 20 | % | 22 | % | 21 | % | |||||||||||||||||||||
Non-GAAP Definition for Adjusted Expense Ratio
The company references the non-GAAP financial measure entitled adjusted expense ratio as a measure of its operating performance. The company defines adjusted expense ratio as acquisition and operating expenses, net of deferrals, less certain reinsurance expenses, less legal settlement expenses incurred in the companys long-term care insurance business divided by the sum of premiums, policy fees and other income. Management believes that the expense ratio analysis enhances understanding of the operating performance of the company. However, the adjusted expense ratio as defined by the company should not be viewed as a substitute for the GAAP basis expense ratio.
(1) | In the second quarter of 2022, the company paid $365 million to a third party in connection with the recapture of certain single premium immediate annuity contracts. |
(2) | Estimated pre-tax class action attorney fees incurred in connection with legal settlements in the companys long-term care insurance business. These amounts are accrued in the period the court settlement occurs. |
(3) | In the first quarter of 2022, the company recorded a legal settlement accrual of $25 million in its life insurance business, which increased the adjusted expense ratio by three percentage points for the three months ended March 31, 2022. |
38
GENWORTH FINANCIAL, INC.
FINANCIAL SUPPLEMENT
FOURTH QUARTER 2023
Reconciliation of Reported Yield to Core Yield
2023 | 2022 | |||||||||||||||||||||||||||||||||||||||||
(Assets - amounts in billions) | 4Q | 3Q | 2Q | 1Q | Total | 4Q | 3Q | 2Q | 1Q | Total | ||||||||||||||||||||||||||||||||
Reported - Total Invested Assets and Cash | $ | 62.0 | $ | 58.7 | $ | 61.0 | $ | 61.6 | $ | 62.0 | $ | 60.7 | $ | 60.1 | $ | 63.2 | $ | 68.2 | $ | 60.7 | ||||||||||||||||||||||
Subtract: | ||||||||||||||||||||||||||||||||||||||||||
Unrealized gains (losses) |
(2.4 | ) | (5.8 | ) | (3.7 | ) | (3.0 | ) | (2.4 | ) | (4.2 | ) | (4.9 | ) | (1.9 | ) | 3.0 | (4.2 | ) | |||||||||||||||||||||||
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Adjusted end of period invested assets and cash | $ | 64.4 | $ | 64.5 | $ | 64.7 | $ | 64.6 | $ | 64.4 | $ | 64.9 | $ | 65.0 | $ | 65.1 | $ | 65.2 | $ | 64.9 | ||||||||||||||||||||||
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(A) |
Average Invested Assets and Cash Used in Reported and Core Yield Calculation | $ | 64.5 | $ | 64.6 | $ | 64.6 | $ | 64.8 | $ | 64.6 | $ | 65.0 | $ | 65.0 | $ | 65.2 | $ | 65.4 | $ | 65.2 | |||||||||||||||||||||
(Income - amounts in millions) | ||||||||||||||||||||||||||||||||||||||||||
(B) |
Reported - Net Investment Income | $ | 810 | $ | 801 | $ | 785 | $ | 787 | $ | 3,183 | $ | 787 | $ | 808 | $ | 787 | $ | 764 | $ | 3,146 | |||||||||||||||||||||
Subtract: | ||||||||||||||||||||||||||||||||||||||||||
Bond calls and commercial mortgage loan prepayments |
| 1 | | 2 | 3 | 6 | 6 | 7 | 10 | 29 | ||||||||||||||||||||||||||||||||
Other non-core items(1) |
4 | 1 | 3 | 1 | 9 | (1 | ) | | | | (1 | ) | ||||||||||||||||||||||||||||||
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(C) |
Core Net Investment Income | $ | 806 | $ | 799 | $ | 782 | $ | 784 | $ | 3,171 | $ | 782 | $ | 802 | $ | 780 | $ | 754 | $ | 3,118 | |||||||||||||||||||||
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(B) / (A) |
Reported Yield | 5.03 | % | 4.96 | % | 4.86 | % | 4.86 | % | 4.92 | % | 4.84 | % | 4.97 | % | 4.83 | % | 4.67 | % | 4.83 | % | |||||||||||||||||||||
(C) / (A) |
Core Yield | 5.00 | % | 4.95 | % | 4.84 | % | 4.84 | % | 4.91 | % | 4.81 | % | 4.93 | % | 4.79 | % | 4.61 | % | 4.79 | % | |||||||||||||||||||||
Note: Yields have been annualized.
Non-GAAP Definition for Core Yield
The company references the non-GAAP financial measure entitled core yield as a measure of investment yield. The company defines core yield as the investment yield adjusted for items that do not reflect the underlying performance of the investment portfolio. Management believes that analysis of core yield enhances understanding of the investment yield of the company. However, core yield is not a substitute for investment yield determined in accordance with U.S. GAAP.
(1) | Includes cost basis adjustments on structured securities and various other immaterial items. |
39