LOGO

 

Exhibit 99.2

 


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

 

Table of Contents

   Page  

Investor Letter

     3  

Use of Non-GAAP Measures

     4  

Results of Operations and Selected Operating Performance Measures

     5  

Financial Highlights

     6  

Consolidated Quarterly Results

  

Consolidated Net Income (Loss) by Quarter

     8  

Reconciliation of Net Income (Loss) to Adjusted Operating Income (Loss)

     9  

Consolidated Balance Sheets

     10-11  

Consolidated Balance Sheets by Segment

     12-13  

Quarterly Results by Business

  

Adjusted Operating Income and New Insurance Written—Enact Segment

     15-20  

Adjusted Operating Income (Loss) and Statutory Impact of In-Force Rate Actions—Long-Term Care Insurance Segment

     22-23  

Adjusted Operating Income (Loss)—Life and Annuities Segment

     25-28  

Adjusted Operating Loss—Corporate and Other

     30  

Additional Financial Data

  

Investments Summary

     32  

Fixed Maturity Securities Summary

     33  

U.S. GAAP Net Investment Income Yields

     34  

Net Investment Gains (Losses)—Detail

     35  

Reconciliations of Non-GAAP Measures

  

Reconciliation of Operating Return On Equity (ROE)

     37  

Reconciliation of Consolidated Expense Ratio

     38  

Reconciliation of Reported Yield to Core Yield

     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

FIRST QUARTER 2024

 

Dear Investor,

Thank you for your continued interest in Genworth Financial, Inc.

Please see the accompanying press release and summary presentation posted to the company’s website at http://investor.genworth.com for additional information regarding its first quarter 2024 earnings results.

Investors are encouraged to listen to the company’s earnings call on the first quarter 2024 results at 9:00 a.m. (ET) on May 2, 2024.

Regards,

Sarah Crews, Investor Relations

InvestorInfo@genworth.com

 

3


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

 

Use of Non-GAAP Measures

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) 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 company’s 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 company’s 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 company’s 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 determined 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 company’s 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.

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

FIRST QUARTER 2024

 

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 segment’s 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 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.

This financial supplement contains selected operating performance measures including “new insurance written,” “insurance in-force” and “risk in-force,” which are commonly used in the insurance industry as measures of operating performance.

Management regularly monitors and reports new insurance written for the company’s Enact segment as a measure of volume of new business generated in a period. 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 mortgage 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 company’s 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 company’s U.S. mortgage insurance subsidiaries. Risk in-force is based on the coverage percentage applied to the estimated current outstanding loan balance. These metrics are presented on a direct basis and exclude reinsurance. 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.

Management also regularly monitors and reports a loss ratio for the company’s Enact segment, which 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

FIRST QUARTER 2024

 

Financial Highlights

(amounts in millions, except per share data)

 

Balance Sheet Data

   March 31,
  2024  
    December 31,
  2023  
    September 30,
  2023  
    June 30,
  2023  
    March 31,
  2023  
 

Total Genworth Financial, Inc.’s stockholders’ equity, excluding accumulated other comprehensive income (loss)

   $ 10,100     $ 10,035     $ 10,276     $ 10,321     $ 10,292  

Total accumulated other comprehensive income (loss)(1)

     (2,094     (2,555     (2,220     (2,861     (2,853
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Genworth Financial, Inc.’s stockholders’ equity

   $ 8,006     $ 7,480     $ 8,056     $ 7,460     $ 7,439  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Book value per share

   $ 18.21     $ 16.74     $ 17.80     $ 15.98     $ 15.28  

Book value per share, excluding accumulated other comprehensive income (loss)

   $ 22.98     $ 22.46     $ 22.70     $ 22.11     $ 21.14  

Common shares outstanding as of the balance sheet date

     439.6       446.8       452.7       466.8       486.9  
     Twelve months ended  

Twelve Month Rolling Average ROE

   March 31,
2024
    December 31,
2023
    September 30,
2023
    June 30,
2023
    March 31,
2023
 

U.S. GAAP Basis ROE

     0.9     0.7     6.6     7.7     8.0

Operating ROE(2)

     (0.2 )%      0.4     6.0     7.2     8.0
     Three months ended  

Quarterly Average ROE

   March 31,
2024
    December 31,
2023
    September 30,
2023
    June 30,
2023
    March 31,
2023
 

U.S. GAAP Basis ROE

     5.5     (8.4 )%      1.1     5.3     4.8

Operating ROE(2)

     3.4     (9.1 )%      1.6     3.3     5.6

Basic and Diluted Shares

   Three months ended
March 31, 2024
                         

Weighted-average common shares used in basic earnings per share calculations

     443.0          

Potentially dilutive securities:

          

Performance stock units, restricted stock units and other equity-based awards

     7.3          
  

 

 

         

Weighted-average common shares used in diluted earnings per share calculations

     450.3          
  

 

 

         

 

(1)

As of March 31, 2024, December 31, 2023, September 30, 2023, June 30, 2023 and March 31, 2023, total accumulated other comprehensive income (loss) includes $(334) million, $(1,439) million, $1,826 million, $(964) million and $(1,628) 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.

 

6


 

 Consolidated Quarterly Results

  

 

 

7


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

Consolidated Net Income (Loss) by Quarter

(amounts in millions, except per share amounts)

 

     2024      2023  
     1Q      4Q     3Q     2Q     1Q     Total  

REVENUES:

               

Premiums

   $ 875      $ 904     $ 915     $ 902     $ 915     $ 3,636  

Net investment income

     782        810       801       785       787       3,183  

Net investment gains (losses)

     49        38       (43     39       (11     23  

Policy fees and other income

     158        159       158       166       163       646  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     1,864        1,911       1,831       1,892       1,854       7,488  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

BENEFITS AND EXPENSES:

               

Benefits and other changes in policy reserves

     1,203        1,233       1,199       1,175       1,176       4,783  

Liability remeasurement (gains) losses

     (8      416       116       70       (15     587  

Changes in fair value of market risk benefits and associated hedges

     (23      14       (24     (19     17       (12

Interest credited

     125        124       127       126       126       503  

Acquisition and operating expenses, net of deferrals

     236        248       228       226       240       942  

Amortization of deferred acquisition costs and intangibles

     65        63       65       64       72       264  

Interest expense

     30        30       30       29       29       118  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total benefits and expenses

     1,628        2,128       1,741       1,671       1,645       7,185  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

     236        (217     90       221       209       303  

Provision (benefit) for income taxes

     66        (36     30       55       55       104  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INCOME (LOSS) FROM CONTINUING OPERATIONS

     170        (181     60       166       154       199  

Income (loss) from discontinued operations, net of taxes(1)

     (1      (2     —        2       —        —   
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

NET INCOME (LOSS)

     169        (183     60       168       154       199  

Less: net income attributable to noncontrolling interests

     30        29       31       31       32       123  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

NET INCOME (LOSS) AVAILABLE TO GENWORTH FINANCIAL, INC.’S COMMON STOCKHOLDERS

   $ 139      $ (212   $ 29     $ 137     $ 122     $ 76  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
                   

Earnings (Loss) Per Share Data:

             

Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders per share

             

Basic

   $ 0.32      $ (0.47   $ 0.06     $ 0.28     $ 0.25     $ 0.16  

Diluted

   $ 0.31      $ (0.47   $ 0.06     $ 0.28     $ 0.24     $ 0.16  

Net income (loss) available to Genworth Financial, Inc.’s common stockholders per share

             

Basic

   $ 0.31      $ (0.47   $ 0.06     $ 0.29     $ 0.25     $ 0.16  

Diluted

   $ 0.31      $ (0.47   $ 0.06     $ 0.29     $ 0.24     $ 0.16  

Weighted-average common shares outstanding

             

Basic

     443.0        449.4       460.5       473.2       492.3       468.8  

Diluted(2)

     450.3        449.4       466.0       478.1       500.1       474.9  

 

(1)

Income (loss) from discontinued operations primarily relates to a settlement agreement involving the company’s 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

FIRST QUARTER 2024

 

Reconciliation of Net Income (Loss) to Adjusted Operating Income (Loss)

(amounts in millions, except per share amounts)

 

     2024      2023  
     1Q      4Q     3Q     2Q     1Q     Total  

NET INCOME (LOSS) AVAILABLE TO GENWORTH FINANCIAL, INC.’S COMMON STOCKHOLDERS

   $ 139      $ (212   $ 29     $ 137     $ 122     $ 76  

Add: net income attributable to noncontrolling interests

     30        29       31       31       32       123  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

NET INCOME (LOSS)

     169        (183     60       168       154       199  

Less: income (loss) from discontinued operations, net of taxes

     (1      (2     —        2       —        —   
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INCOME (LOSS) FROM CONTINUING OPERATIONS

     170        (181     60       166       154       199  

Less: net income from continuing operations attributable to noncontrolling interests

     30        29       31       31       32       123  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INCOME (LOSS) FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL, INC.’S COMMON STOCKHOLDERS

     140        (210     29       135       122       76  
 

ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL, INC.’S COMMON STOCKHOLDERS:

               

Net investment (gains) losses, net(1)

     (50      (38     43       (41     11       (25

Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges(2)

     (26      13       (26     (23     14       (22

(Gains) losses on early extinguishment of debt

     (1      (1     —        —        (1     (2

Expenses related to restructuring

     7        —        —        1       3       4  

Taxes on adjustments

     15        6       (4     13       (5     10  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

ADJUSTED OPERATING INCOME (LOSS)

   $ 85      $ (230   $ 42     $ 85     $ 144     $ 41  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

ADJUSTED OPERATING INCOME (LOSS):

               

Enact segment

   $ 135      $ 129     $ 134     $ 146     $ 143     $ 552  

Long-Term Care Insurance segment

     3        (151     (71     (43     23       (242

Life and Annuities segment:

               

Life Insurance

     (33      (206     (25     (17     (27     (275

Fixed Annuities

     11        9       17       10       14       50  

Variable Annuities

     7        14       5       9       9       37  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Life and Annuities segment

     (15      (183     (3     2       (4     (188
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Corporate and Other

     (38      (25     (18     (20     (18     (81
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

ADJUSTED OPERATING INCOME (LOSS)

   $ 85      $ (230   $ 42     $ 85     $ 144     $ 41  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
                   

Earnings (Loss) Per Share Data:

             

Net income (loss) available to Genworth Financial, Inc.’s common stockholders per share

             

Basic

   $ 0.31      $ (0.47   $ 0.06     $ 0.29     $ 0.25     $ 0.16  

Diluted

   $ 0.31      $ (0.47   $ 0.06     $ 0.29     $ 0.24     $ 0.16  

Adjusted operating income (loss) per share

             

Basic

   $ 0.19      $ (0.51   $ 0.09     $ 0.18     $ 0.29     $ 0.09  

Diluted

   $ 0.19      $ (0.51   $ 0.09     $ 0.18     $ 0.29     $ 0.09  

Weighted-average common shares outstanding

             

Basic

     443.0        449.4       460.5       473.2       492.3       468.8  

Diluted(3)

     450.3        449.4       466.0       478.1       500.1       474.9  

 

(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

FIRST QUARTER 2024

 

Consolidated Balance Sheets

(amounts in millions)

 

     March 31,
2024
     December 31,
2023
    September 30,
2023
    June 30,
2023
    March 31,
2023
 

ASSETS

             

Investments:

             

Fixed maturity securities available-for-sale, at fair value(1)

   $ 46,065      $ 46,781     $ 43,968     $ 46,070     $ 47,381  

Equity securities, at fair value

     427        396       363       378       364  

Commercial mortgage loans(2)

     6,748        6,829       6,818       6,876       6,915  

Less: Allowance for credit losses

     (29      (27     (25     (24     (24
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Commercial mortgage loans, net

     6,719        6,802       6,793       6,852       6,891  

Policy loans

     2,219        2,220       2,233       2,270       2,133  

Limited partnerships

     2,949        2,821       2,699       2,585       2,456  

Other invested assets

     683        731       645       648       617  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total investments

     59,062        59,751       56,701       58,803       59,842  

Cash, cash equivalents and restricted cash

     1,952        2,215       1,993       2,173       1,752  

Accrued investment income

     707        647       620       553       700  

Deferred acquisition costs

     1,934        1,988       2,042       2,096       2,150  

Intangible assets

     197        198       199       201       203  

Reinsurance recoverable

     18,315        19,054       17,623       19,113       19,606  

Less: Allowance for credit losses

     (27      (29     (28     (64     (64
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Reinsurance recoverable, net

     18,288        19,025       17,595       19,049       19,542  

Other assets

     516        489       453       445       478  

Deferred tax asset

     1,839        1,952       1,580       1,954       2,002  

Market risk benefit assets

     52        43       39       37       28  

Separate account assets

     4,645        4,509       4,244       4,533       4,479  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total assets

   $ 89,192      $ 90,817     $ 85,466     $ 89,844     $ 91,176  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 
                 

 

(1) 

Amortized cost of $49,281 million, $49,365 million, $49,855 million, $49,864 million and $50,461 million as of March 31, 2024, December 31, 2023, September 30, 2023, June 30, 2023 and March 31, 2023, respectively, and allowance for credit losses of $7 million, $7 million, $6 million, $4 million and $15 million as of March 31, 2024, December 31, 2023, September 30, 2023, June 30, 2023 and March 31, 2023, respectively.

(2) 

Net of unamortized balance of loan origination fees and costs of $4 million as of March 31, 2024, December 31, 2023, September 30, 2023, June 30, 2023 and March 31, 2023.

 

10


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

 

Consolidated Balance Sheets

(amounts in millions)

 

    March 31,
2024
     December 31,
2023
    September 30,
2023
    June 30,
2023
    March 31,
2023
 

LIABILITIES AND EQUITY

            

Liabilities:

            

Future policy benefits

  $ 55,545      $ 57,655     $ 51,740     $ 56,443     $ 57,531  

Policyholder account balances

    15,315        15,540       15,590       15,922       16,202  

Market risk benefit liabilities

    528        625       579       666       761  

Liability for policy and contract claims

    673        652       631       628       665  

Unearned premiums

    139        149       162       175       189  

Other liabilities

    1,889        1,768       2,038       1,607       1,510  

Long-term borrowings

    1,579        1,584       1,602       1,601       1,600  

Separate account liabilities

    4,645        4,509       4,244       4,533       4,479  

Liabilities related to discontinued operations(1)

    —         —        2       2       7  
 

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total liabilities

    80,313        82,482       76,588       81,577       82,944  
 

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Equity:

            

Common stock

    1        1       1       1       1  

Additional paid-in capital

    11,873        11,884       11,877       11,869       11,863  

Accumulated other comprehensive income (loss):

            

Change in the discount rate used to measure future policy benefits

    (334      (1,439     1,826       (964     (1,628

All other

    (1,760      (1,116     (4,046     (1,897     (1,225
 

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total accumulated other comprehensive income (loss)

    (2,094      (2,555     (2,220     (2,861     (2,853

Retained earnings

    1,352        1,213       1,426       1,398       1,261  

Treasury stock, at cost

    (3,126      (3,063     (3,028     (2,947     (2,833
 

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total Genworth Financial, Inc.’s stockholders’ equity

    8,006        7,480       8,056       7,460       7,439  

Noncontrolling interests

    873        855       822       807       793  
 

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total equity

    8,879        8,335       8,878       8,267       8,232  
 

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total liabilities and equity

  $ 89,192      $ 90,817     $ 85,466     $ 89,844     $ 91,176  
 

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 
                

 

(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 company’s former lifestyle protection insurance business.

 

11


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

 

Consolidated Balance Sheet by Segment

(amounts in millions)

 

     March 31, 2024  
     Enact     Long-Term
Care Insurance
    Life and
Annuities
    Corporate
and
Other
(1)
    Total  

ASSETS

          

Cash and investments

   $ 6,045     $ 35,652     $ 18,552     $ 1,472     $ 61,721  

Deferred acquisition costs and intangible assets

     46       886       1,184       15       2,131  

Reinsurance recoverable, net

     2       7,228       11,058       —        18,288  

Deferred tax and other assets

     210       1,681       275       189       2,355  

Market risk benefit assets

     —        —        52       —        52  

Separate account assets

     —        —        4,645       —        4,645  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total assets

   $ 6,303     $ 45,447     $ 35,766     $ 1,676     $ 89,192  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

LIABILITIES AND EQUITY

          

Liabilities:

          

Future policy benefits

   $ —      $ 42,339     $ 13,206     $ —      $ 55,545  

Policyholder account balances

     —        —        15,315       —        15,315  

Market risk benefit liabilities

     —        —        528       —        528  

Liability for policy and contract claims

     532       —        134       7       673  

Unearned premiums

     139       —        —        —        139  

Other liabilities

     167       893       293       536       1,889  

Borrowings

     746       —        —        833       1,579  

Separate account liabilities

     —        —        4,645       —        4,645  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total liabilities

     1,584       43,232       34,121       1,376       80,313  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Equity:

          

Allocated equity, excluding accumulated other comprehensive income (loss)

     4,041       2,727       2,552       780       10,100  

Allocated accumulated other comprehensive income (loss)

     (195     (512     (907     (480     (2,094
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Genworth Financial, Inc.’s stockholders’ equity

     3,846       2,215       1,645       300       8,006  

Noncontrolling interests

     873       —        —        —        873  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total equity

     4,719       2,215       1,645       300       8,879  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total liabilities and equity

   $ 6,303     $ 45,447     $ 35,766     $ 1,676     $ 89,192  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(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

FIRST QUARTER 2024

 

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.

 

13


 

Enact Segment

  

 

 

 

14


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

Adjusted Operating Income—Enact Segment

(amounts in millions)

 

     2024      2023  
     1Q      4Q     3Q      2Q     1Q     Total  

REVENUES:

                

Premiums

   $ 241      $ 240     $ 243      $ 239     $ 235     $ 957  

Net investment income

     57        57       55        50       46       208  

Net investment gains (losses)

     (6      (1     —         (13     —        (14

Policy fees and other income

     —         —        1        1       —        2  
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

 

Total revenues

     292        296       299        277       281       1,153  
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

 

BENEFITS AND EXPENSES:

                

Benefits and other changes in policy reserves

     20        24       18        (4     (11     27  

Acquisition and operating expenses, net of deferrals

     51        56       52        52       52       212  

Amortization of deferred acquisition costs and intangibles

     2        3       3        2       3       11  

Interest expense

     13        13       13        13       13       52  
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

 

Total benefits and expenses

     86        96       86        63       57       302  
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

 

INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

     206        200       213        214       224       851  

Provision for income taxes

     45        43       48        46       49       186  
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

 

INCOME FROM CONTINUING OPERATIONS

     161        157       165        168       175       665  

Less: net income attributable to noncontrolling interests

     30        29       31        31       32       123  
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

 

INCOME FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL, INC.’S COMMON STOCKHOLDERS

     131        128       134        137       143       542  
 

ADJUSTMENTS TO INCOME FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL, INC.’S COMMON STOCKHOLDERS:

                

Net investment (gains) losses, net(1)

     5        1       —         11       —        12  

Taxes on adjustments

     (1      —        —         (2     —        (2
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

 

ADJUSTED OPERATING INCOME

   $ 135      $ 129     $ 134      $ 146     $ 143     $ 552  
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

 
                    
              

Direct Primary New Insurance Written (NIW)

   $ 10,526      $ 10,453     $ 14,391      $ 15,083     $ 13,154     $ 53,081  
                    

 

(1) 

Net investment (gains) losses were adjusted for the portion attributable to noncontrolling interests of $1 million in the first quarter of 2024 and $2 million in the second quarter of 2023.

 

15


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

 

Direct Primary New Insurance Written Metrics—Enact Segment

(amounts in millions)

 

     2024      2023  
     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
 

Payment Type

                            

Monthly

   $ 10,034        95    $ 10,187        98   $ 14,099        98   $ 14,774        98   $ 12,809        97

Single

     475        5        246        2       269        2       281        2       318        3  

Other(1)

     17        —         20        —        23        —        28        —        27        —   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total

   $ 10,526        100    $ 10,453        100   $ 14,391        100   $ 15,083        100   $ 13,154        100
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Origination

                            

Purchase

   $ 10,072        96    $ 10,169        97   $ 14,073        98   $ 14,720        98   $ 12,761        97

Refinance

     454        4        284        3       318        2       363        2       393        3  
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total

   $ 10,526        100    $ 10,453        100   $ 14,391        100   $ 15,083        100   $ 13,154        100
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

FICO Scores

                            

Over 760

   $ 5,218        49    $ 5,086        49   $ 6,679        46   $ 6,911        46   $ 6,004        46

740 - 759

     1,664        16        1,680        16       2,438        17       2,608        17       2,268        17  

720 - 739

     1,368        13        1,378        13       1,928        13       2,097        14       1,817        14  

700 - 719

     990        9        997        10       1,422        10       1,499        10       1,296        10  

680 - 699

     629        6        664        6       974        7       1,060        7       954        7  

660 - 679(2)

     388        4        409        4       592        4       568        4       517        4  

640 - 659

     193        2        181        2       282        2       260        2       229        2  

620 - 639

     73        1        53        —        74        1       76        —        65        —   

<620

     3        —         5        —        2        —        4        —        4        —   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total

   $ 10,526        100    $ 10,453        100   $ 14,391        100   $ 15,083        100   $ 13,154        100
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Loan-To-Value Ratio

                            

95.01% and above

   $ 2,262        21    $ 1,820        18   $ 2,677        18   $ 2,692        18   $ 2,106        16

90.01% to 95.00%

     3,876        37        3,759        36       5,431        38       5,743        38       4,928        38  

85.01% to 90.00%

     3,177        30        3,489        33       4,568        32       4,753        31       4,390        33  

85.00% and below

     1,211        12        1,385        13       1,715        12       1,895        13       1,730        13  
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total

   $ 10,526        100    $ 10,453        100   $ 14,391        100   $ 15,083        100   $ 13,154        100
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Debt-To-Income Ratio

                            

45.01% and above

   $ 3,165        30    $ 3,158        30   $ 4,437        31   $ 4,467        30   $ 3,538        27

38.01% to 45.00%

     3,824        36        3,816        37       4,936        34       5,214        34       4,940        38  

38.00% and below

     3,537        34        3,479        33       5,018        35       5,402        36       4,676        35  
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total

   $ 10,526        100    $ 10,453        100   $ 14,391        100   $ 15,083        100   $ 13,154        100
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 
                                      

 

(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

FIRST QUARTER 2024

 

Other Metrics—Enact Segment

(dollar amounts in millions)

 

     2024     2023  
     1Q     4Q     3Q     2Q     1Q     Total  
   

Direct Primary Insurance In-Force

   $ 263,645     $ 262,937     $ 262,014     $ 257,816     $ 252,516    
   

Direct Risk In-Force

              

Primary

   $ 67,950     $ 67,529     $ 67,056     $ 65,714     $ 64,106    

Pool

     67       69       70       73       76    
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

Total Direct Risk In-Force

   $ 68,017     $ 67,598     $ 67,126     $ 65,787     $ 64,182    
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   
   

Expense Ratio(1)

     22     25     23     23     23     23
   

Primary Persistency Rate

     85     86     84     84     85     85
   

Combined Risk To Capital Ratio(2)

     11.2:1       11.6:1       11.6:1       11.8:1       12.6:1    
   

EMICO Risk To Capital Ratio(2),(3)

     11.2:1       11.6:1       11.6:1       11.9:1       12.7:1    
   

PMIERs Available Assets(4)

   $ 4,853     $ 5,006     $ 5,268     $ 5,093     $ 5,357    
   

PMIERs Required Assets(4)

   $ 2,970     $ 3,119     $ 3,251     $ 3,135     $ 3,259    
   

Available Assets Above PMIERs Requirements(4)

   $ 1,883     $ 1,887     $ 2,017     $ 1,958     $ 2,098    
   

PMIERs Sufficiency Ratio(4)

     163     161     162     162     164  
   

Average Primary Loan Size (in thousands)

   $ 272     $ 270     $ 268     $ 265     $ 262    

 

(1)

The ratio of an insurer’s 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. The expense ratio is calculated using whole dollars and may be different than the ratio calculated using the rounded numbers included herein.

(2)

Certain states limit a private mortgage insurer’s risk in-force to 25 times the total of the insurer’s 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 company’s U.S. mortgage insurance subsidiaries.

(3)

Enact Mortgage Insurance Corporation (EMICO), the company’s 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.

 

17


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

 

Loss Metrics—Enact Segment

(amounts in millions)

 

     2024      2023  
     1Q      4Q     3Q     2Q     1Q     Total  

Average Direct Primary Paid Claim (in thousands)(1)

   $ 37.5      $ 37.2     $ 38.7     $ 37.4     $ 39.0    

Average Reserve Per Primary Delinquency (in thousands)(2)

   $ 24.9      $ 23.3     $ 23.9     $ 25.0     $ 24.8    
 

Reserves:

               

Direct primary case(3)

   $ 486      $ 477     $ 460     $ 452     $ 462    

All other(3)

     46        41       41       38       40    
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

Total Reserves

   $ 532      $ 518     $ 501     $ 490     $ 502    
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   
 

Beginning Reserves

   $ 518      $ 501     $ 490     $ 502     $ 519     $ 519  

Paid claims

     (6      (7     (7     (8     (6     (28

Increase (decrease) in reserves

     20        24       18       (4     (11     27  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Ending Reserves

   $ 532      $ 518     $ 501     $ 490     $ 502     $ 518  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Loss Ratio(4)

     8      10     7     (2 )%      (5 )%      3
                   

 

(1)

Paid claims on direct primary case reserves divided by the number of paid claims. Average direct primary paid claims in the first quarter of 2024 and the fourth quarter of 2023 include payments in relation to agreements on non-performing loans. Prior year amounts have been reclassified to conform to the current year presentation.

(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.

(4)

The loss ratio is calculated using whole dollars and may be different than the ratio calculated using the rounded numbers included herein.

 

18


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

 

Delinquency Metrics—Enact Segment

(dollar amounts in millions)

 

    2024     2023  
    1Q     4Q     3Q     2Q     1Q     Total  

Primary Loans

             

Primary loans in-force

    969,866       974,516       977,832       973,280         965,544    

Primary delinquent loans

    19,492       20,432       19,241       18,065       18,633    

Primary delinquency rate

    2.01     2.10     1.97     1.86     1.93  
 

Beginning Number of Primary Delinquencies

    20,432       19,241       18,065       18,633       19,943       19,943  

New delinquencies

    11,395       11,706       11,107       9,205       9,599       41,617  

Delinquency cures

    (12,160     (10,317     (9,778     (9,609     (10,771     (40,475

Paid claims

    (172     (186     (147     (156     (126     (615

Rescissions and claim denials

    (3     (12     (6     (8     (12     (38
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Ending Number of Primary Delinquencies

    19,492       20,432       19,241       18,065       18,633         20,432  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
 

Composition of Cures

             

Reported delinquent and cured-intraquarter

    2,726       2,058       1,877       1,661       2,016    

Number of missed payments delinquent prior to cure:

             

3 payments or less

    5,994       5,235       4,792       4,516       5,238    

4 - 11 payments

    2,749       2,331       2,265       2,448       2,431    

12 payments or more

    691       693       844       984       1,086    
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

Total

    12,160       10,317       9,778       9,609       10,771    
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

Primary Delinquencies by Missed Payment Status

             

3 payments or less

    9,506       10,166       9,398       8,162       7,876    

4 - 11 payments

    6,853       6,934       6,381       6,229       6,714    

12 payments or more

    3,133       3,332       3,462       3,674       4,043    
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

Primary Delinquencies

    19,492       20,432       19,241       18,065       18,633    
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   
                 
    March 31, 2024                    

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

  $ 87     $ 600       14      

4 - 11 payments in default

    220       468       47      

12 payments or more in default

    179       197       91      
 

 

 

   

 

 

         

Total

  $ 486     $ 1,265       38      
 

 

 

   

 

 

         
    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      
 

 

 

   

 

 

         

Total

  $ 477     $ 1,298       37      
 

 

 

   

 

 

         

 

(1)

Direct primary case reserves exclude loss adjustment expenses, pool, incurred but not reported and reinsurance reserves.

 

19


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

 

Portfolio Quality Metrics—Enact Segment

(amounts in millions)

 

     March 31, 2024  

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

     15   $ 5,420        2   $ 1,397        2     8.12

2009-2016

     7       7,368        3       1,943        3       3.74

2017

     4       5,015        2       1,324        2       3.41

2018

     6       5,524        2       1,419        2       4.13

2019

     8       13,126        5       3,403        5       2.70

2020

     14       42,183        16       11,181        16       1.67

2021

     22       66,971        25       17,174        25       1.63

2022

     19       58,051        22       14,629        22       1.61

2023

     5       49,556        19       12,810        19       0.67

2024

     —        10,431        4       2,670        4       0.02
  

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

Total

     100   $ 263,645        100   $ 67,950        100     2.01
  

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

     March 31, 2024     December 31, 2023     March 31, 2023  
     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

   $ 13,250        20   $ 12,878        19   $ 11,545        18

90.01% to 95.00%

     31,881        47       31,781        47       30,589        48  

85.01% to 90.00%

     19,265        28       19,163        28       18,054        28  

85.00% and below

     3,554        5       3,707        6       3,918        6  
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total

   $ 67,950        100   $ 67,529        100   $ 64,106        100
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

 

     March 31, 2024     December 31, 2023     March 31, 2023  
     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

   $ 28,703        42   $ 28,363        42   $ 26,480        41

740 - 759

     11,167        17       11,096        17       10,418        16  

720 - 739

     9,669        14       9,621        14       9,126        14  

700 - 719

     7,629        11       7,623        11       7,406        12  

680 - 699

     5,524        8       5,557        8       5,481        9  

660 - 679(2)

     2,908        4       2,908        4       2,809        4  

640 - 659

     1,562        3       1,565        3       1,549        3  

620 - 639

     632        1       635        1       660        1  

<620

     156        —        161        —        177        —   
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total

   $ 67,950        100   $ 67,529        100   $ 64,106        100
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

 

(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

FIRST QUARTER 2024

Adjusted Operating Income (Loss)—Long-Term Care Insurance Segment

(amounts in millions)

 

     2024      2023  
     1Q      4Q(1)     3Q     2Q     1Q     Total  

REVENUES:

               

Premiums

   $ 578      $ 615     $ 621     $ 611     $ 616     $ 2,463  

Net investment income

     464        489       482       470       473       1,914  

Net investment gains (losses)

     63        64       (21     62       9       114  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     1,105        1,168       1,082       1,143       1,098       4,491  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

BENEFITS AND EXPENSES:

               

Benefits and other changes in policy reserves

     936        964       953       941       944       3,802  

Liability remeasurement (gains) losses

     (16      188       104       61       (32     321  

Acquisition and operating expenses, net of deferrals

     102        116       109       108       119       452  

Amortization of deferred acquisition costs and intangibles

     17        18       17       18       18       71  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total benefits and expenses

     1,039        1,286       1,183       1,128       1,049       4,646  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

     66        (118     (101     15       49       (155

Provision (benefit) for income taxes

     14        (18     (13     10       18       (3
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INCOME (LOSS) FROM CONTINUING OPERATIONS

     52        (100     (88     5       31       (152

ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS:

               

Net investment (gains) losses

     (63      (64     21       (62     (9     (114

Expenses related to restructuring

     1        —        —        1       (1     —   

Taxes on adjustments

     13        13       (4     13       2       24  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

ADJUSTED OPERATING INCOME (LOSS)

   $ 3      $ (151   $ (71   $ (43   $ 23     $ (242
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Liability remeasurement (gains) losses:

               

Cash flow assumption updates

   $ (2    $ 61     $ (6   $ (24   $ 21     $ 52  

Actual to expected experience

     (14      127       110       85       (53     269  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ (16    $ 188     $ 104     $ 61     $ (32   $ 321  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Ratio of the liability remeasurement (gains) losses to beginning reserves(2)

     (0.04 )%       0.45     0.25     0.15     (0.08 )%      0.77
                   

 

(1) 

In the fourth quarter of 2023, the liability remeasurement loss of $188 million in the company’s 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 the coronavirus pandemic (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 its assumption for future approvals and benefit reductions given its current plans for rate increase filings and historical experience regarding approvals and regulatory support, as well as benefit reductions 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 and therefore had a muted favorable impact on the liability remeasurement (gain) loss in the income statement.

(2) 

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

FIRST QUARTER 2024

 

Statutory Impact of In-Force Rate Actions—Long-Term Care Insurance Segment

(amounts in millions)

 

     2024      2023  
     1Q      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)

   $ 217      $ 232     $ 231     $ 224     $ 219     $ 906  

Reserve changes(2)

     114        119       99       104       94       416  
 

Settlement impacts - reserve changes

     240        232       169       97       93       591  

Settlement impacts - litigation expenses and settlement payments

     (109      (116     (102     (54     (56     (328
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Settlement impacts, net

     131        116       67       43       37       263  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Statutory earnings from in-force rate actions

   $ 462      $ 467     $ 397     $ 371     $ 350     $ 1,585  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
                   

 

(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

FIRST QUARTER 2024

Adjusted Operating Income (Loss)—Life and Annuities Segment

(amounts in millions)

 

     2024      2023  
     1Q      4Q(1)     3Q     2Q     1Q     Total  

REVENUES:

               

Premiums

   $ 53      $ 47     $ 48     $ 50     $ 62     $ 207  

Net investment income

     254        256       261       261       264       1,042  

Net investment gains (losses)

     (4      (14     (18     (7     (10     (49

Policy fees and other income

     158        160       158       165       163       646  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     461        449       449       469       479       1,846  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

BENEFITS AND EXPENSES:

               

Benefits and other changes in policy reserves

     250        248       229       240       246       963  

Liability remeasurement (gains) losses

     8        228       12       9       17       266  

Changes in fair value of market risk benefits and associated hedges

     (23      14       (24     (19     17       (12

Interest credited

     125        124       127       126       126       503  

Acquisition and operating expenses, net of deferrals

     54        55       54       51       53       213  

Amortization of deferred acquisition costs and intangibles

     45        41       45       44       51       181  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total benefits and expenses

     459        710       443       451       510       2,114  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

     2        (261     6       18       (31     (268

Provision (benefit) for income taxes

     —         (56     1       3       (7     (59
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INCOME (LOSS) FROM CONTINUING OPERATIONS

     2        (205     5       15       (24     (209
 

ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS:

               

Net investment (gains) losses

     4        14       18       7       10       49  

Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges(2)

     (26      13       (26     (23     14       (22

Taxes on adjustments

     5        (5     —        3       (4     (6
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

ADJUSTED OPERATING INCOME (LOSS)

   $ (15    $ (183   $ (3   $ 2     $ (4   $ (188
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
                   

 

(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 company’s 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:

 

   

Changes in fair value of market risk benefits and associated hedges

   $ (23    $ 14     $ (24   $ (19   $ 17     $ (12

Adjustment for changes in reserves, attributed fees and benefit payments

     (3      (1     (2     (4     (3     (10
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges

   $ (26    $ 13     $ (26   $ (23   $ 14     $ (22
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

25


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

 

Adjusted Operating Loss—Life and Annuities Segment—Life Insurance

(amounts in millions)

 

     2024      2023  
     1Q      4Q(1),(2)      3Q     2Q     1Q     Total  

REVENUES:

                

Premiums

   $ 53      $ 47      $ 48     $ 50     $ 62     $ 207  

Net investment income

     167        167        169       165       164       665  

Net investment gains (losses)

     5        (6      —        (1     (2     (9

Policy fees and other income

     129        131        130       136       134       531  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     354        339        347       350       358       1,394  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

BENEFITS AND EXPENSES:

                

Benefits and other changes in policy reserves

     208        207        184       197       199       787  

Liability remeasurement (gains) losses

     11        229        22       7       18       276  

Interest credited

     99        98        99       98       98       393  

Acquisition and operating expenses, net of deferrals

     35        38        36       34       36       144  

Amortization of deferred acquisition costs and intangibles

     38        35        38       36       44       153  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total benefits and expenses

     391        607        379       372       395       1,753  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

     (37      (268      (32     (22     (37     (359

Benefit for income taxes

     (8      (57      (7     (5     (8     (77
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

LOSS FROM CONTINUING OPERATIONS

     (29      (211      (25     (17     (29     (282
 

ADJUSTMENTS TO LOSS FROM CONTINUING OPERATIONS:

                

Net investment (gains) losses

     (5      6        —        1       2       9  

Taxes on adjustments

     1        (1      —        (1     —        (2
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

ADJUSTED OPERATING LOSS

   $ (33    $ (206    $ (25   $ (17   $ (27   $ (275
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 
                    

 

(1) 

In the fourth quarter of 2023, the company’s 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 $5 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 $35 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

FIRST QUARTER 2024

 

Adjusted Operating Income—Life and Annuities Segment—Fixed Annuities

(amounts in millions)

 

     2024      2023  
     1Q      4Q     3Q     2Q     1Q     Total  

REVENUES:

               

Net investment income

   $ 80      $ 82     $ 85     $ 87     $ 91     $ 345  

Net investment gains (losses)

     (9      (8     (18     (5     (8     (39

Policy fees and other income

     2        2       1       2       2       7  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     73        76       68       84       85       313  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

BENEFITS AND EXPENSES:

               

Benefits and other changes in policy reserves

     36        35       36       35       39       145  

Liability remeasurement (gains) losses

     (3      (1     (10     2       (1     (10

Changes in fair value of market risk benefits and associated hedges

     (7      16       (18     (4     8       2  

Interest credited

     25        26       26       27       27       106  

Acquisition and operating expenses, net of deferrals

     8        8       9       7       8       32  

Amortization of deferred acquisition costs and intangibles

     3        2       3       4       3       12  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total benefits and expenses

     62        86       46       71       84       287  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

     11        (10     22       13       1       26  

Provision (benefit) for income taxes

     2        (2     5       3       —        6  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INCOME (LOSS) FROM CONTINUING OPERATIONS

     9        (8     17       10       1       20  
 

ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS:

               

Net investment (gains) losses

     9        8       18       5       8       39  

Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges(1)

     (7      14       (18     (5     8       (1

Taxes on adjustments

     —         (5     —        —        (3     (8
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

ADJUSTED OPERATING INCOME

   $ 11      $ 9     $ 17     $ 10     $ 14     $ 50  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
                   

 

(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

   $ (7    $ 16     $ (18   $ (4   $ 8     $ 2  

Adjustment for changes in reserves, attributed fees and benefit payments

     —         (2     —        (1     —        (3
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges

   $ (7    $ 14     $ (18   $ (5   $ 8     $ (1
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

27


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

 

Adjusted Operating Income—Life and Annuities Segment—Variable Annuities

(amounts in millions)

 

     2024      2023  
     1Q      4Q     3Q     2Q     1Q     Total  

REVENUES:

               

Net investment income

   $ 7      $ 7     $ 7     $ 9     $ 9     $ 32  

Net investment gains (losses)

     —         —        —        (1     —        (1

Policy fees and other income

     27        27       27       27       27       108  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     34        34       34       35       36       139  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

BENEFITS AND EXPENSES:

               

Benefits and other changes in policy reserves

     6        6       9       8       8       31  

Changes in fair value of market risk benefits and associated hedges

     (16      (2     (6     (15     9       (14

Interest credited

     1        —        2       1       1       4  

Acquisition and operating expenses, net of deferrals

     11        9       9       10       9       37  

Amortization of deferred acquisition costs and intangibles

     4        4       4       4       4       16  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total benefits and expenses

     6        17       18       8       31       74  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

     28        17       16       27       5       65  

Provision for income taxes

     6        3       3       5       1       12  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INCOME FROM CONTINUING OPERATIONS

     22        14       13       22       4       53  
 

ADJUSTMENTS TO INCOME FROM CONTINUING OPERATIONS:

               

Net investment (gains) losses

     —         —        —        1       —        1  

Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges(1)

     (19      (1     (8     (18     6       (21

Taxes on adjustments

     4        1       —        4       (1     4  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

ADJUSTED OPERATING INCOME

   $ 7      $ 14     $ 5     $ 9     $ 9     $ 37  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
                   

 

(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

   $ (16    $ (2   $ (6   $ (15   $ 9     $ (14

Adjustment for changes in reserves, attributed fees and benefit payments

     (3      1       (2     (3     (3     (7
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Changes in fair value of market risk benefits attributable to interest rates, equity markets and associated hedges

   $ (19    $ (1   $ (8   $ (18   $ 6     $ (21
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

28


 

 

Corporate and Other

  

 

29


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

Adjusted Operating Loss—Corporate and Other(1)

(amounts in millions)

 

     2024      2023  
     1Q      4Q     3Q     2Q     1Q     Total  
                                       

REVENUES:

               

Premiums

   $ 3      $ 2     $ 3     $ 2     $ 2     $ 9  

Net investment income

     7        8       3       4       4       19  

Net investment gains (losses)

     (4      (11     (4     (3     (10     (28

Policy fees and other income

     —         (1     (1     —        —        (2
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     6        (2     1       3       (4     (2
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

BENEFITS AND EXPENSES:

               

Benefits and other changes in policy reserves

     (3      (3     (1     (2     (3     (9

Acquisition and operating expenses, net of deferrals

     29        21       13       15       16       65  

Amortization of deferred acquisition costs and intangibles

     1        1       —        —        —        1  

Interest expense

     17        17       17       16       16       66  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total benefits and expenses

     44        36       29       29       29       123  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

     (38      (38     (28     (26     (33     (125

Provision (benefit) for income taxes

     7        (5     (6     (4     (5     (20
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

LOSS FROM CONTINUING OPERATIONS

     (45      (33     (22     (22     (28     (105
 

ADJUSTMENTS TO LOSS FROM CONTINUING OPERATIONS:

               

Net investment (gains) losses

     4        11       4       3       10       28  

(Gains) losses on early extinguishment of debt

     (1      (1     —        —        (1     (2

Expenses related to restructuring

     6        —        —        —        4       4  

Taxes on adjustments

     (2      (2     —        (1     (3     (6
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

ADJUSTED OPERATING LOSS

   $ (38    $ (25   $ (18   $ (20   $ (18   $ (81
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
                   

 

(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

FIRST QUARTER 2024

Investments Summary

(amounts in millions)

 

     March 31, 2024      December 31, 2023     September 30, 2023     June 30, 2023     March 31, 2023  
     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

   $ 26,667        43    $ 27,302        43   $ 25,148        42   $ 26,413        43   $ 26,894        44

Private fixed maturity securities

     11,021        18        11,016        18       10,432        17       10,808        18       11,182        18  

Residential mortgage-backed securities(1)

     876        1        907        1       891        2       935        1       986        2  

Commercial mortgage-backed securities

     1,315        2        1,413        2       1,495        3       1,674        3       1,814        3  

Other asset-backed securities

     2,264        4        2,199        4       2,163        4       2,164        4       2,113        3  

State and political subdivisions

     2,266        4        2,302        4       2,164        4       2,343        4       2,403        4  

Non-investment grade fixed maturity securities

     1,656        3        1,642        3       1,675        3       1,733        3       1,989        3  

Equity securities:

                            

Common stocks and mutual funds

     377        1        347        1       316        1       326        1       306        1  

Preferred stocks

     50        —         49        —        47        —        52        —        58        —   

Commercial mortgage loans, net

     6,719        11        6,802        10       6,793        11       6,852        11       6,891        11  

Policy loans

     2,219        4        2,220        4       2,233        4       2,270        4       2,133        3  

Limited partnerships

     2,949        5        2,821        5       2,699        5       2,585        4       2,456        4  

Cash, cash equivalents, restricted cash and short-term investments

     1,962        3        2,242        4       2,023        3       2,196        3       1,759        3  

Other invested assets:

   Derivatives:                             
  

Interest rate swaps

     35        —         55        —        12        —        30        —        42        —   
  

Foreign currency swaps

     11        —         10        —        15        —        16        —        17        —   
  

Equity index options

     20        —         15        —        11        —        15        —        10        —   
  

Forward bond purchase commitments

     41        —         51        —        —         —        —         —        —         —   
  

Other

     566        1        573        1       577        1       564        1       541        1  
     

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total invested assets and cash

   $ 61,014        100    $ 61,966        100   $ 58,694        100   $ 60,976        100   $ 61,594        100
     

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Public Fixed Maturity Securities—Credit Quality:

                                                                  

NRSRO(2) Designation

                          
   

       AAA

   $ 2,472        8    $ 2,559        8   $ 2,533        8   $ 5,936        19   $ 6,112        19

        AA

     6,113        19        6,170        19       5,650        19       2,896        9       2,872        9  

        A

     8,945        28        9,287        29       8,359        28       8,597        27       8,699        27  

       BBB

     13,336        43        13,645        42       12,923        43       13,649        43       14,056        43  

        BB

     519        2        498        2       519        2       564        2       786        2  

        B

     27        —         30        —        20        —        23        —        41        —   

     CCC and lower

     —         —         —         —        —         —        —         —        —         —   
     

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total public fixed maturity securities

   $ 31,412        100    $ 32,189        100   $ 30,004        100   $ 31,665        100   $ 32,566        100
     

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Private Fixed Maturity Securities—Credit Quality:

                                                                  

NRSRO(2) Designation

                          
   

       AAA

   $ 851        6    $ 832        6   $ 867        6   $ 863        6   $ 860        6

        AA

     1,570        11        1,477        10       1,352        10       1,416        10       1,422        10  

        A

     4,078        28        4,043        28       3,960        28       4,135        29       4,217        28  

       BBB

     7,044        47        7,126        48       6,649        48       6,845        47       7,154        48  

        BB

     991        7        975        7       993        7       1,016        7       1,012        7  

        B

     104        1        117        1       121        1       122        1       150        1  

     CCC and lower

     —         —         7        —        7        —        8        —        —         —   

      Not rated

     15        —         15        —        15        —        —         —        —         —   
     

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total private fixed maturity securities

   $ 14,653        100    $ 14,592        100   $ 13,964        100   $ 14,405        100   $ 14,815        100
     

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 
                                         

 

 

(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

FIRST QUARTER 2024

 

Fixed Maturity Securities Summary

(amounts in millions)

 

     March 31, 2024      December 31, 2023     September 30, 2023     June 30, 2023     March 31, 2023  
     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

   $ 3,460        8    $ 3,494        7   $ 3,112        7   $ 3,389        7   $ 3,441        7

State and political subdivisions

     2,266        5        2,302        5       2,164        5       2,343        5       2,403        5  

Foreign government

     613        1        626        1       583        1       625        1       630        1  

U.S. corporate

     27,437        59        27,985        60       25,956        60       27,043        59       27,872        59  

Foreign corporate

     7,802        17        7,811        17       7,554        17       7,838        17       8,059        17  

Residential mortgage-backed securities

     876        2        907        2       891        2       934        2       985        2  

Commercial mortgage-backed securities

     1,321        3        1,418        3       1,503        3       1,690        4       1,831        4  

Other asset-backed securities

     2,290        5        2,238        5       2,205        5       2,208        5       2,160        5  
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total fixed maturity securities

   $ 46,065        100    $ 46,781        100   $ 43,968        100   $ 46,070        100   $ 47,381        100
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Corporate Bond Holdings - Industry Sector:

                            
   

Investment Grade:

                            

Finance and insurance

   $ 8,876        25    $ 9,045        25   $ 8,541        26   $ 8,871        26   $ 9,149        26

Utilities

     4,902        14        4,904        14       4,503        13       4,653        14       4,788        13  

Energy

     3,153        9        3,181        9       2,967        9       3,022        9       2,882        8  

Consumer - non-cyclical

     4,981        15        4,979        14       4,573        14       4,863        14       4,998        14  

Consumer - cyclical

     1,588        5        1,659        5       1,497        4       1,558        4       1,602        4  

Capital goods

     2,559        7        2,593        7       2,406        7       2,490        7       2,554        7  

Industrial

     1,832        5        1,869        5       1,773        5       1,857        5       1,944        6  

Technology and communications

     3,491        10        3,686        10       3,422        10       3,599        10       3,713        10  

Transportation

     1,466        4        1,498        4       1,371        4       1,428        4       1,459        4  

Other

     870        2        895        3       933        3       973        3       1,022        3  
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Subtotal

     33,718        96        34,309        96       31,986        95       33,314        96       34,111        95  
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Non-Investment Grade:

                            

Finance and insurance

     204        1        181        1       176        1       154        —        164        1  

Utilities

     52        —         54        —        72        —        46        —        47        —   

Energy

     197        1        218        1       218        1       228        1       407        1  

Consumer - non-cyclical

     139        —         142        —        135        —        139        —        150        —   

Consumer - cyclical

     260        1        211        1       262        1       273        1       291        1  

Capital goods

     134        —         149        —        157        1       172        1       178        1  

Industrial

     170        —         161        —        145        —        149        —        155        —   

Technology and communications

     213        1        228        1       212        1       226        1       247        1  

Transportation

     27        —         28        —        29        —        35        —        37        —   

Other

     125        —         115        —        118        —        145        —        144        —   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Subtotal

     1,521        4        1,487        4       1,524        5       1,567        4       1,820        5  
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total

   $ 35,239        100    $ 35,796        100   $ 33,510        100   $ 34,881        100   $ 35,931        100
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Fixed Maturity Securities - Contractual Maturity Dates:

                            
   

Due in one year or less

   $ 1,298        3    $ 1,372        3   $ 1,426        3   $ 1,375        3   $ 1,328        3

Due after one year through five years

     8,112        18        8,205        18       8,115        18       8,000        17       8,245        17  

Due after five years through ten years

     11,851        26        12,114        26       11,368        26       11,662        25       11,746        25  

Due after ten years

     20,317        43        20,527        43       18,460        43       20,201        44       21,086        44  
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Subtotal

     41,578        90        42,218        90       39,369        90       41,238        89       42,405        89  

Mortgage and asset-backed securities

     4,487        10        4,563        10       4,599        10       4,832        11       4,976        11  
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total fixed maturity securities

   $ 46,065        100    $ 46,781        100   $ 43,968        100   $ 46,070        100   $ 47,381        100
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 
                                      

 

33


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

 

 

U.S. GAAP Net Investment Income Yields

(amounts in millions)

 

     2024      2023  
     1Q      4Q     3Q     2Q     1Q     Total  

U.S. GAAP Net Investment Income

               

Fixed maturity securities - taxable

   $ 554      $ 557     $ 559     $ 567     $ 561     $ 2,244  

Fixed maturity securities - non-taxable

     1        —        1       1       1       3  

Equity securities

     2        5       1       3       2       11  

Commercial mortgage loans

     75        75       76       75       76       302  

Policy loans

     58        57       58       54       55       224  

Limited partnerships

     20        41       31       17       28       117  

Other invested assets

     68        72       69       70       68       279  

Cash, cash equivalents, restricted cash and short-term investments

     27        27       28       22       18       95  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross investment income before expenses and fees

     805        834       823       809       809       3,275  

Expenses and fees

     (23      (24     (22     (24     (22     (92
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

   $ 782      $ 810     $ 801     $ 785     $ 787     $ 3,183  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Annualized Yields

               

Fixed maturity securities - taxable

     4.5      4.5     4.5     4.5     4.4     4.5

Fixed maturity securities - non-taxable

     10.8      —      5.6     4.9     4.6     4.2

Equity securities

     1.9      5.3     1.1     3.2     2.3     3.0

Commercial mortgage loans

     4.4      4.4     4.5     4.4     4.4     4.4

Policy loans

     10.5      10.2     10.3     9.8     10.3     10.2

Limited partnerships(1)

     2.8      5.9     4.7     2.7     4.7     4.5

Other invested assets(2)

     47.7      50.1     48.3     50.7     51.6     50.5

Cash, cash equivalents, restricted cash and short-term investments

     5.1      5.1     5.3     4.5     4.0     4.7
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross investment income before expenses and fees

     5.0      5.2     5.1     5.0     5.0     5.1

Expenses and fees

     (0.1 )%       (0.2 )%      (0.1 )%      (0.1 )%      (0.1 )%      (0.2 )% 
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

     4.9      5.0     5.0     4.9     4.9     4.9
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
                   

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

FIRST QUARTER 2024

 

 

Net Investment Gains (Losses)—Detail

(amounts in millions)

 

     2024     2023  
     1Q     4Q     3Q     2Q     1Q     Total  

Realized investment gains (losses):

              

Net realized gains (losses) on available-for-sale securities:

              

Fixed maturity securities:

              

U.S. corporate

   $ (17   $ (15   $ (5   $ (39   $ (8   $ (67

U.S. government, agencies and government-sponsored enterprises

     1       (30     2       1       1       (26

Foreign corporate

     (3     (5     (3     1       (3     (10

Foreign government

     —        —        —        —        (1     (1

Mortgage-backed securities

     (3     (18     (5     (2     (5     (30

Asset-backed securities

     —        —        —        9       —        9  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total net realized gains (losses) on available-for-sale securities

     (22     (68     (11     (30     (16     (125

Net realized gains (losses) on equity securities sold

     —        —        —        (1     —        (1
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total net realized investment gains (losses)

     (22     (68     (11     (31     (16     (126
 

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

Net unrealized gains (losses) on equity securities still held

     32       33       (12     21       11       53  

Net unrealized gains (losses) on limited partnerships

     43       57       14       40       —        111  

Commercial mortgage loans

     (2     (2     (1     —        (2     (5

Derivative instruments

     1       24       (28     (1     12       7  

Other

     (3     (5     (3     —        (1     (9
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment gains (losses), gross

     49       38       (43     39       (11     23  

Adjustment for net investment (gains) losses attributable to noncontrolling interests

     1       —        —        2       —        2  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment gains (losses), net

   $ 50     $ 38     $ (43   $ 41     $ (11   $ 25  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
                  

 

35


 

Reconciliations of Non-GAAP Measures

  

 

 

 

 

36


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

Reconciliation of Operating ROE

(amounts in millions)

 

Twelve Month Rolling Average ROE

  Twelve months ended  
U.S. GAAP Basis ROE   March 31,
2024
    December 31,
2023
    September 30,
2023
    June 30,
2023
    March 31,
2023
 

Net income available to Genworth Financial, Inc.’s common stockholders for the twelve months ended(1)

  $ 93     $ 76     $ 669     $ 776     $ 798  

Quarterly average Genworth Financial, Inc.’s stockholders’ equity, excluding accumulated other comprehensive income (loss)(2)

  $ 10,205     $ 10,234     $ 10,205     $ 10,104     $ 9,964  

U.S. GAAP Basis ROE (1)/(2)

    0.9     0.7     6.6     7.7     8.0

Operating ROE

         

Adjusted operating income (loss) for the twelve months ended(1)

  $ (18   $ 41     $ 609     $ 725     $ 793  

Quarterly average Genworth Financial, Inc.’s stockholders’ equity, excluding accumulated other comprehensive income (loss)(2)

  $ 10,205     $ 10,234     $ 10,205     $ 10,104     $ 9,964  

Operating ROE (1)/(2)

    (0.2 )%      0.4     6.0     7.2     8.0

 

Quarterly Average ROE

  Three months ended  
U.S. GAAP Basis ROE   March 31,
2024
    December 31,
2023
    September 30,
2023
    June 30,
2023
    March 31,
2023
 

Net income (loss) available to Genworth Financial, Inc.’s common stockholders for the period ended(3)

  $ 139     $ (212   $ 29     $ 137     $ 122  

Quarterly average Genworth Financial, Inc.’s stockholders’ equity for the period, excluding accumulated other comprehensive income (loss)(4)

  $ 10,068     $ 10,156     $ 10,299     $ 10,307     $ 10,269  

Annualized U.S. GAAP Quarterly Basis ROE(3)/(4)

    5.5     (8.4 )%      1.1     5.3     4.8

Operating ROE

         

Adjusted operating income (loss) for the period ended(3)

  $ 85     $ (230   $ 42     $ 85     $ 144  

Quarterly average Genworth Financial, Inc.’s stockholders’ equity for the period, excluding accumulated other comprehensive income (loss)(4)

  $ 10,068     $ 10,156     $ 10,299     $ 10,307     $ 10,269  

Annualized Operating Quarterly Basis ROE(3)/(4)

    3.4     (9.1 )%      1.6     3.3     5.6

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). 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) 

The twelve months ended information is derived by adding the four quarters of 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), for the most recent five quarters.

(3) 

Net income (loss) available to Genworth Financial, Inc.’s common stockholders and adjusted operating income (loss) from page 9 herein.

(4) 

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

FIRST QUARTER 2024

 

 

Reconciliation of Consolidated Expense Ratio

(amounts in millions)

 

          2024      2023  
     GAAP Basis Expense Ratio    1Q      4Q     3Q     2Q     1Q     Total  

(A)

   Acquisition and operating expenses, net of deferrals    $ 236      $ 248     $ 228     $ 226     $ 240     $ 942  

(B)

   Premiums    $ 875      $ 904     $ 915     $ 902     $ 915     $ 3,636  
 

(A) / (B)

   GAAP Basis Expense Ratio      27      27     25     25     26     26
 
   Adjusted Expense Ratio                
   Acquisition and operating expenses, net of deferrals    $ 236      $ 248     $ 228     $ 226     $ 240     $ 942  
   Less: Legal settlement (recoveries) expenses(1)      (4      —        —        1       13       14  
     

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(C)

   Adjusted acquisition and operating expenses, net of deferrals    $ 240      $ 248     $ 228     $ 225     $ 227     $ 928  
     

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
   Premiums    $ 875      $ 904     $ 915     $ 902     $ 915     $ 3,636  
   Add: Policy fees and other income      158        159       158       166       163       646  
     

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(D)

   Adjusted revenues    $ 1,033      $ 1,063     $ 1,073     $ 1,068     $ 1,078     $ 4,282  
     

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(C) / (D)

   Adjusted expense ratio      23      23     21     21     21     22
                                             

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 company’s 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) 

Estimated pre-tax class action attorney fees incurred in connection with legal settlements in the company’s long-term care insurance business. These amounts are accrued in the period the court settlement occurs. Amounts in the first quarter of 2024 represent insurance recoveries on legal costs incurred in connection with legal settlements in the company’s long-term care insurance business.

 

38


GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

FIRST QUARTER 2024

 

Reconciliation of Reported Yield to Core Yield

 

          2024      2023  
     (Assets - amounts in billions)    1Q      4Q     3Q     2Q     1Q     Total  
   Reported - Total Invested Assets and Cash    $ 61.0      $ 62.0     $ 58.7     $ 61.0     $ 61.6     $ 62.0  
   Subtract:                
  

Unrealized gains (losses)

     (3.1      (2.4     (5.8     (3.7     (3.0     (2.4
     

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
   Adjusted end of period invested assets and cash    $ 64.1      $ 64.4     $ 64.5     $ 64.7     $ 64.6     $ 64.4  
     

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(A)

   Average Invested Assets and Cash Used in Reported and Core Yield Calculation    $ 64.3      $ 64.5     $ 64.6     $ 64.6     $ 64.8     $ 64.6  
 
   (Income - amounts in millions)                
 

(B)

   Reported - Net Investment Income    $ 782      $ 810     $ 801     $ 785     $ 787     $ 3,183  
   Subtract:                
  

Bond calls and commercial mortgage loan prepayments

     1        —        1       —        2       3  
  

Other non-core items(1)

     2        4       1       3       1       9  
     

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(C)

   Core Net Investment Income    $ 779      $ 806     $ 799     $ 782     $ 784     $ 3,171  
     

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(B) / (A)

   Reported Yield      4.87      5.03     4.96     4.86     4.86     4.92

(C) / (A)

   Core Yield      4.85      5.00     4.95     4.84     4.84     4.91
                                             

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