Manulife weighs a John Hancock IPO or spin-off

Persistently low interest rates have hammered insurance company profitability.
JUL 13, 2017

Persistently low interest rates that have hammered insurance company profitability seem to be behind a move by Manulife Financial Corp. to explore an initial public offering or spin-off of its John Hancock Financial Services Inc. unit, The Wall Street Journal reports. Other insurance firms, including MetLife and AXA, already have trimmed their U.S. operations. The Journal cites two sources as saying the Toronto-based insurance giant Manulife has been under pressure from some of its shareholders to sell Hancock after years of disappointing returns. The Canadian insurer, which is now focusing on Asia, bought the Boston-based Hancock in 2004 for roughly $10.3 billion. (More: John Hancock picks robo for retirement accounts) At recent investor events, Manulife executives have discussed divesting less profitable parts of John Hancock. These included at least some blocks of long-term-care insurance and lifetime-income guarantees, according to a company presentation.

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