☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 80-0873306 | ||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) | ||
6620 West Broad Street Richmond, Virginia | 23230 | ||
(Address of principal executive offices) | (Zip Code) |
$.001 per share |
Large accelerated filer | ☒ | Accelerated filer | ☐ | ||||||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | ||||||
Emerging growth company | ☐ |
Title of Each Class | Trading Symbol | Name of each exchange on which registered | ||
Class A Common Stock, par value $.001 per share | GNW | New York Stock Exchange |
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Item 2. | 79 | |||||||||
Item 3. | 173 | |||||||||
Item 4. | 173 | |||||||||
174 | ||||||||||
Item 1. | 174 | |||||||||
Item 1A. | 174 | |||||||||
Item 6. | 175 | |||||||||
176 |
Item 1. | Financial Statements |
June 30, | December 31, | |||||||
2019 | 2018 | |||||||
(Unaudited) | ||||||||
Assets | ||||||||
Investments: | ||||||||
Fixed maturity securities available-for-sale, at fair value | $ | 63,774 | $ | 59,661 | ||||
Equity securities, at fair value | 644 | 655 | ||||||
Commercial mortgage loans ($56 and $62 are restricted as of June 30, 2019 and December 31, 2018, respectively, related to a securitization entity) | 7,019 | 6,749 | ||||||
Policy loans | 2,076 | 1,861 | ||||||
Other invested assets | 1,535 | 1,188 | ||||||
Total investments | 75,048 | 70,114 | ||||||
Cash, cash equivalents and restricted cash | 1,938 | 2,177 | ||||||
Accrued investment income | 626 | 675 | ||||||
Deferred acquisition costs | 2,105 | 3,263 | ||||||
Intangible assets and goodwill | 244 | 347 | ||||||
Reinsurance recoverable | 17,211 | 17,278 | ||||||
Other assets | 564 | 474 | ||||||
Deferred tax asset | 383 | 736 | ||||||
Separate account assets | 6,187 | 5,859 | ||||||
Total assets | $ | 104,306 | $ | 100,923 | ||||
Liabilities and equity | ||||||||
Liabilities: | ||||||||
Future policy benefits | $ | 39,583 | $ | 37,940 | ||||
Policyholder account balances | 22,673 | 22,968 | ||||||
Liability for policy and contract claims | 10,677 | 10,379 | ||||||
Unearned premiums | 3,488 | 3,546 | ||||||
Other liabilities | 1,723 | 1,682 | ||||||
Non-recourse funding obligations | 311 | 311 | ||||||
Long-term borrowings | 4,044 | 4,025 | ||||||
Deferred tax liability | 28 | 24 | ||||||
Separate account liabilities | 6,187 | 5,859 | ||||||
Total liabilities | 88,714 | 86,734 | ||||||
Commitments and contingencies | ||||||||
Equity: | ||||||||
Class A common stock, $0.001 par value; 1.5 billion shares authorized; 592 million and 589 million shares issued as of June 30, 2019 and December 31, 2018, respectively; 504 million and 501 million shares outstanding as of June 30, 2019 and December 31, 2018, respectively | 1 | 1 | ||||||
Additional paid-in capital | 11,983 | 11,987 | ||||||
Accumulated other comprehensive income (loss): | ||||||||
Net unrealized investment gains (losses): | ||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired | 1,294 | 585 | ||||||
Net unrealized gains (losses) on other-than-temporarily impaired securities | 11 | 10 | ||||||
Net unrealized investment gains (losses) | 1,305 | 595 | ||||||
Derivatives qualifying as hedges | 1,983 | 1,781 | ||||||
Foreign currency translation and other adjustments | (275 | ) | (332 | ) | ||||
Total accumulated other comprehensive income (loss) | 3,013 | 2,044 | ||||||
Retained earnings | 1,460 | 1,118 | ||||||
Treasury stock, at cost (88 million shares as of June 30, 2019 and December 31, 2018) | (2,700 | ) | (2,700 | ) | ||||
Total Genworth Financial, Inc.’s stockholders’ equity | 13,757 | 12,450 | ||||||
Noncontrolling interests | 1,835 | 1,739 | ||||||
Total equity | 15,592 | 14,189 | ||||||
Total liabilities and equity | $ | 104,306 | $ | 100,923 |
June 30, 2020 | December 31, 2019 | |||||||
(Unaudited) | ||||||||
Assets | ||||||||
Investments: | ||||||||
Fixed maturity securities available-for-sale, 2020) | $ | 63,544 | $ | 60,339 | ||||
Equity securities, at fair value | 206 | 239 | ||||||
Commercial mortgage loans (net of unamortized balance of loan origination fees and costs of $4 as of June 30, 2020 and December 31, 2019) | 6,945 | 6,976 | ||||||
Less: Allowance for credit losses | (28 | ) | (13 | ) | ||||
Commercial mortgage loans, net | 6,917 | 6,963 | ||||||
Policy loans | 2,182 | 2,058 | ||||||
Other invested assets | 2,473 | 1,632 | ||||||
Total investments | 75,322 | 71,231 | ||||||
Cash, cash equivalents and restricted cash | 2,597 | 3,341 | ||||||
Accrued investment income | 601 | 654 | ||||||
Deferred acquisition costs | 1,718 | 1,836 | ||||||
Intangible assets and goodwill | 223 | 201 | ||||||
Reinsurance recoverable | 16,944 | 17,103 | ||||||
Less: Allowance for credit losses | (44 | ) | — | |||||
Reinsurance recoverable, net | 16,900 | 17,103 | ||||||
Other assets | 454 | 443 | ||||||
Deferred tax asset | 286 | 425 | ||||||
Separate account assets | 5,536 | 6,108 | ||||||
Total assets | $ | 103,637 | $ | 101,342 | ||||
Liabilities and equity | ||||||||
Liabilities: | ||||||||
Future policy benefits | $ | 41,463 | $ | 40,384 | ||||
Policyholder account balances | 22,921 | 22,217 | ||||||
Liability for policy and contract claims | 11,280 | 10,958 | ||||||
Unearned premiums | 1,804 | 1,893 | ||||||
Other liabilities | 2,075 | 1,428 | ||||||
Non-recourse funding obligations | — | 311 | ||||||
Long-term borrowings | 2,817 | 3,277 | ||||||
Separate account liabilities | 5,536 | 6,108 | ||||||
Liabilities related to discontinued operations | 653 | 134 | ||||||
Total liabilities | 88,549 | 86,710 | ||||||
Commitments and contingencies | ||||||||
Equity: | ||||||||
Class A common stock, $0.001 par value; 1.5 billion shares authorized; 594 million and 592 million shares issued as of June 30, 2020 and December 31, 2019, respectively; 506 million and 504 million shares outstanding as of June 30, 2020 and December 31, 2019, respectively | 1 | 1 | ||||||
Additional paid-in capital | 11,996 | 11,990 | ||||||
Accumulated other comprehensive income (loss) | 4,447 | 3,433 | ||||||
Retained earnings | 899 | 1,461 | ||||||
Treasury stock, at cost (88 million shares as of June 30, 2020 and December 31, 2019) | (2,700 | ) | (2,700 | ) | ||||
Total Genworth Financial, Inc.’s stockholders’ equity | 14,643 | 14,185 | ||||||
Noncontrolling interests | 445 | 447 | ||||||
Total equity | 15,088 | 14,632 | ||||||
Total liabilities and equity | $ | 103,637 | $ | 101,342 | ||||
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 1,126 | $ | 1,136 | $ | 2,240 | $ | 2,276 | ||||||||
Net investment income | 852 | 828 | 1,681 | 1,632 | ||||||||||||
Net investment gains (losses) | (45 | ) | (14 | ) | 29 | (45 | ) | |||||||||
Policy fees and other income | 223 | 209 | 410 | 411 | ||||||||||||
Total revenues | 2,156 | 2,159 | 4,360 | 4,274 | ||||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 1,270 | 1,205 | 2,571 | 2,516 | ||||||||||||
Interest credited | 146 | 152 | 293 | 308 | ||||||||||||
Acquisition and operating expenses, net of deferrals | 247 | 253 | 498 | 493 | ||||||||||||
Amortization of deferred acquisition costs and intangibles | 95 | 112 | 186 | 216 | ||||||||||||
Interest expense | 73 | 77 | 145 | 153 | ||||||||||||
Total benefits and expenses | 1,831 | 1,799 | 3,693 | 3,686 | ||||||||||||
Income before income taxes | 325 | 360 | 667 | 588 | ||||||||||||
Provision for income taxes | 107 | 111 | 219 | 174 | ||||||||||||
Net income | 218 | 249 | 448 | 414 | ||||||||||||
Less: net income attributable to noncontrolling interests | 50 | 59 | 106 | 112 | ||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | $ | 168 | $ | 190 | $ | 342 | $ | 302 | ||||||||
Net income available to Genworth Financial, Inc.’s common stockholders per share: | ||||||||||||||||
Basic | $ | 0.33 | $ | 0.38 | $ | 0.68 | $ | 0.60 | ||||||||
Diluted | $ | 0.33 | $ | 0.38 | $ | 0.67 | $ | 0.60 | ||||||||
Weighted-average common shares outstanding: | ||||||||||||||||
Basic | 503.4 | 500.6 | 502.3 | 500.1 | ||||||||||||
Diluted | 508.7 | 502.6 | 508.7 | 502.6 | ||||||||||||
Supplemental disclosures: | ||||||||||||||||
Total other-than-temporary impairments | $ | — | $ | — | $ | — | $ | — | ||||||||
Portion of other-than-temporary impairments included in other comprehensive income (loss) | — | — | — | — | ||||||||||||
Net other-than-temporary impairments | — | — | — | — | ||||||||||||
Other investments gains (losses) | (45 | ) | (14 | ) | 29 | (45 | ) | |||||||||
Total net investment gains (losses) | $ | (45 | ) | $ | (14 | ) | $ | 29 | $ | (45 | ) | |||||
Three ended June 30, | Six ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 1,019 | $ | 1,001 | $ | 2,034 | $ | 1,989 | ||||||||
Net investment income | 786 | 816 | 1,579 | 1,610 | ||||||||||||
Net investment gains (losses) | 159 | (46 | ) | 7 | 29 | |||||||||||
Policy fees and other income | 174 | 223 | 355 | 410 | ||||||||||||
Total revenues | 2,138 | 1,994 | 3,975 | 4,038 | ||||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 1,486 | 1,251 | 2,847 | 2,533 | ||||||||||||
Interest credited | 139 | 146 | 280 | 293 | ||||||||||||
Acquisition and operating expenses, net of deferrals | 223 | 229 | 472 | 466 | ||||||||||||
Amortization of deferred acquisition costs and intangibles | 93 | 84 | 209 | 165 | ||||||||||||
Goodwill impairment | 5 | — | 5 | — | ||||||||||||
Interest expense | 44 | 60 | 96 | 120 | ||||||||||||
Total benefits and expenses | 1,990 | 1,770 | 3,909 | 3,577 | ||||||||||||
Income from continuing operations before income taxes | 148 | 224 | 66 | 461 | ||||||||||||
Provision for income taxes | 46 | 66 | 36 | 135 | ||||||||||||
Income from continuing operations | 102 | 158 | 30 | 326 | ||||||||||||
Income (loss) from discontinued operations, net of taxes | (520 | ) | 60 | (520 | ) | 122 | ||||||||||
Net income (loss) | (418 | ) | 218 | (490 | ) | 448 | ||||||||||
Less: net income from continuing operations attributable to noncontrolling interests | 23 | 15 | 17 | 35 | ||||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests | — | 35 | — | 71 | ||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (441 | ) | $ | 168 | $ | (507 | ) | $ | 342 | ||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
Income from continuing operations available to Genworth Financial, Inc.’s common stockholders | $ | 79 | $ | 143 | $ | 13 | $ | 291 | ||||||||
Income (loss) from discontinued operations available to Genworth Financial, Inc.’s common stockholders | (520 | ) | 25 | (520 | ) | 51 | ||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (441 | ) | $ | 168 | $ | (507 | ) | $ | 342 | ||||||
Income from continuing operations available to Genworth Financial, Inc.’s common stockholders per share: | ||||||||||||||||
Basic | $ | 0.16 | $ | 0.29 | $ | 0.03 | $ | 0.58 | ||||||||
Diluted | $ | 0.15 | $ | 0.28 | $ | 0.03 | $ | 0.57 | ||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders per share: | ||||||||||||||||
Basic | $ | (0.87 | ) | $ | 0.33 | $ | (1.00 | ) | $ | 0.68 | ||||||
Diluted | $ | (0.86 | ) | $ | 0.33 | $ | (0.99 | ) | $ | 0.67 | ||||||
Weighted-average common shares outstanding: | ||||||||||||||||
Basic | 505.4 | 503.4 | 504.8 | 502.3 | ||||||||||||
Diluted | 512.5 | 508.7 | 511.1 | 508.7 | ||||||||||||
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Net income | $ | 218 | $ | 249 | $ | 448 | $ | 414 | ||||||||
Other comprehensive income (loss), net of taxes: | ||||||||||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired | 376 | (185 | ) | 755 | (526 | ) | ||||||||||
Net unrealized gains (losses) on other-than-temporarily impaired securities | — | (2 | ) | 1 | (2 | ) | ||||||||||
Derivatives qualifying as hedges | 133 | (64 | ) | 202 | (216 | ) | ||||||||||
Foreign currency translation and other adjustments | 43 | (98 | ) | 97 | (185 | ) | ||||||||||
Total other comprehensive income (loss) | 552 | (349 | ) | 1,055 | (929 | ) | ||||||||||
Total comprehensive income (loss) | 770 | (100 | ) | 1,503 | (515 | ) | ||||||||||
Less: comprehensive income attributable to noncontrolling interests | 81 | 10 | 192 | 14 | ||||||||||||
Total comprehensive income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | 689 | $ | (110 | ) | $ | 1,311 | $ | (529 | ) | ||||||
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Net income (loss) | $ | (418 | ) | $ | 218 | $ | (490 | ) | $ | 448 | ||||||
Other comprehensive income (loss), net of taxes: | ||||||||||||||||
Net unrealized gains (losses) on securities without an allowance for credit losses | 682 | — | 362 | — | ||||||||||||
Net unrealized gains (losses) on securities with an allowance for credit losses | (8 | ) | — | (8 | ) | — | ||||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired | — | 376 | — | 755 | ||||||||||||
Net unrealized gains (losses) on other-than-temporarily impaired securities | — | — | — | 1 | ||||||||||||
Derivatives qualifying as hedges | (78 | ) | 133 | 675 | 202 | |||||||||||
Foreign currency translation and other adjustments | 73 | 43 | (25 | ) | 97 | |||||||||||
Total other comprehensive income (loss) | 669 | 552 | 1,004 | 1,055 | ||||||||||||
Total comprehensive income | 251 | 770 | 514 | 1,503 | ||||||||||||
Less: comprehensive income attributable to noncontrolling interests | 60 | 81 | 7 | 192 | ||||||||||||
Total comprehensive income available to Genworth Financial, Inc.’s common stockholders | $ | 191 | $ | 689 | $ | 507 | $ | 1,311 | ||||||||
Three months ended June 30, 2019 | ||||||||||||||||||||||||||||||||
Total | ||||||||||||||||||||||||||||||||
Genworth | ||||||||||||||||||||||||||||||||
Accumulated | Financial, | |||||||||||||||||||||||||||||||
Additional | other | Treasury | Inc.’s | |||||||||||||||||||||||||||||
Common | paid-in | comprehensive | Retained | stock, at | stockholders’ | Noncontrolling | Total | |||||||||||||||||||||||||
stock | capital | income (loss) | earnings | cost | equity | interests | equity | |||||||||||||||||||||||||
Balances as of March 31, 2019 | $ | 1 | $ | 11,989 | $ | 2,492 | $ | 1,292 | $ | (2,700 | ) | $ | 13,074 | $ | 1,808 | $ | 14,882 | |||||||||||||||
Repurchase of subsidiary shares | — | — | — | — | — | — | (32 | ) | (32 | ) | ||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||
Net income | — | — | — | 168 | — | 168 | 50 | 218 | ||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | 521 | — | — | 521 | 31 | 552 | ||||||||||||||||||||||||
Total comprehensive income | — | 689 | 81 | 770 | ||||||||||||||||||||||||||||
Dividends to noncontrolling interests | — | — | — | — | — | — | (25 | ) | (25 | ) | ||||||||||||||||||||||
Stock-based compensation expense and exercises and other | — | (6 | ) | — | — | — | (6 | ) | 3 | (3 | ) | |||||||||||||||||||||
Balances as of June 30, 2019 | $ | 1 | $ | 11,983 | $ | 3,013 | $ | 1,460 | $ | (2,700 | ) | $ | 13,757 | $ | 1,835 | $ | 15,592 | |||||||||||||||
Three months ended June 30, 2018 | ||||||||||||||||||||||||||||||||
Total | ||||||||||||||||||||||||||||||||
Genworth | ||||||||||||||||||||||||||||||||
Accumulated | Financial, | |||||||||||||||||||||||||||||||
Additional | other | Treasury | Inc.’s | |||||||||||||||||||||||||||||
Common | paid-in | comprehensive | Retained | stock, at | stockholders’ | Noncontrolling | Total | |||||||||||||||||||||||||
stock | capital | income (loss) | earnings | cost | equity | interests | equity | |||||||||||||||||||||||||
Balances as of March 31, 2018 | $ | 1 | $ | 11,979 | $ | 2,627 | $ | 1,111 | $ | (2,700 | ) | $ | 13,018 | $ | 1,844 | $ | 14,862 | |||||||||||||||
Repurchase of subsidiary shares | — | — | — | — | — | — | (13 | ) | (13 | ) | ||||||||||||||||||||||
Comprehensive income (loss): | ||||||||||||||||||||||||||||||||
Net income | — | — | — | 190 | — | 190 | 59 | 249 | ||||||||||||||||||||||||
Other comprehensive loss, net of taxes | — | — | (300 | ) | — | — | (300 | ) | (49 | ) | (349 | ) | ||||||||||||||||||||
Total comprehensive income (loss) | (110 | ) | 10 | (100 | ) | |||||||||||||||||||||||||||
Dividends to noncontrolling interests | — | — | — | — | — | — | (14 | ) | (14 | ) | ||||||||||||||||||||||
Stock-based compensation expense and exercises and other | — | 2 | — | — | — | 2 | 4 | 6 | ||||||||||||||||||||||||
Balances as of June 30, 2018 | $ | 1 | $ | 11,981 | $ | 2,327 | $ | 1,301 | $ | (2,700 | ) | $ | 12,910 | $ | 1,831 | $ | 14,741 | |||||||||||||||
Three months ended June 30, 2020 | ||||||||||||||||||||||||||||||||
Total | ||||||||||||||||||||||||||||||||
Genworth | ||||||||||||||||||||||||||||||||
Accumulated | Financial, | |||||||||||||||||||||||||||||||
Additional | other | Treasury | Inc.’s | |||||||||||||||||||||||||||||
Common | paid-in | comprehensive | Retained | stock, at | stockholders’ | Noncontrolling | Total | |||||||||||||||||||||||||
stock | capital | income (loss) | earnings | cost | equity | interests | equity | |||||||||||||||||||||||||
Balances as of March 31, 2020 | $ | 1 | $ | 11,993 | $ | 3,815 | $ | 1,340 | $ | (2,700 | ) | $ | 14,449 | $ | 385 | $ | 14,834 | |||||||||||||||
Comprehensive income (loss): | ||||||||||||||||||||||||||||||||
Net loss | — | — | — | (441 | ) | — | (441 | ) | 23 | (418 | ) | |||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | 632 | — | — | 632 | 37 | 669 | ||||||||||||||||||||||||
Total comprehensive income | 191 | 60 | 251 | |||||||||||||||||||||||||||||
Stock-based compensation expense and exercises and other | — | 3 | — | — | — | 3 | — | 3 | ||||||||||||||||||||||||
Balances as of June 30, 2020 | $ | 1 | $ | 11,996 | $ | 4,447 | $ | 899 | $ | (2,700 | ) | $ | 14,643 | $ | 445 | $ | 15,088 | |||||||||||||||
Three months ended June 30, 2019 | ||||||||||||||||||||||||||||||||
Total | ||||||||||||||||||||||||||||||||
Genworth | ||||||||||||||||||||||||||||||||
Accumulated | Financial, | |||||||||||||||||||||||||||||||
Additional | other | Treasury | Inc.’s | |||||||||||||||||||||||||||||
Common | paid-in | comprehensive | Retained | stock, at | stockholders’ | Noncontrolling | Total | |||||||||||||||||||||||||
stock | capital | income (loss) | earnings | cost | equity | interests | equity | |||||||||||||||||||||||||
Balances as of March 31, 2019 | $ | 1 | $ | 11,989 | $ | 2,492 | $ | 1,292 | $ | (2,700 | ) | $ | 13,074 | $ | 1,808 | $ | 14,882 | |||||||||||||||
Repurchase of subsidiary shares | — | — | — | — | — | — | (32 | ) | (32 | ) | ||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||
Net income | — | — | — | 168 | — | 168 | 50 | 218 | ||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | 521 | — | — | 521 | 31 | 552 | ||||||||||||||||||||||||
Total comprehensive income | 689 | 81 | 770 | |||||||||||||||||||||||||||||
Dividends to noncontrolling interests | — | — | — | — | — | — | (25 | ) | (25 | ) | ||||||||||||||||||||||
Stock-based compensation expense and exercises and other | — | (6 | ) | — | — | — | (6 | ) | 3 | (3 | ) | |||||||||||||||||||||
Balances as of June 30, 2019 | $ | 1 | $ | 11,983 | $ | 3,013 | $ | 1,460 | $ | (2,700 | ) | $ | 13,757 | $ | 1,835 | $ | 15,592 | |||||||||||||||
Six months ended June 30, 2019 | ||||||||||||||||||||||||||||||||
Total | ||||||||||||||||||||||||||||||||
Genworth | ||||||||||||||||||||||||||||||||
Accumulated | Financial, | |||||||||||||||||||||||||||||||
Additional | other | Treasury | Inc.’s | |||||||||||||||||||||||||||||
Common | paid-in | comprehensive | Retained | stock, at | stockholders’ | Noncontrolling | Total | |||||||||||||||||||||||||
stock | capital | income (loss) | earnings | cost | equity | interests | equity | |||||||||||||||||||||||||
Balances as of December 31, 2018 | $ | 1 | $ | 11,987 | $ | 2,044 | $ | 1,118 | $ | (2,700 | ) | $ | 12,450 | $ | 1,739 | $ | 14,189 | |||||||||||||||
Repurchase of subsidiary shares | — | — | — | — | — | — | (44 | ) | (44 | ) | ||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||
Net income | — | — | — | 342 | — | 342 | 106 | 448 | ||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | 969 | — | — | 969 | 86 | 1,055 | ||||||||||||||||||||||||
Total comprehensive income | 1,311 | 192 | 1,503 | |||||||||||||||||||||||||||||
Dividends to noncontrolling interests | — | — | — | — | — | — | (53 | ) | (53 | ) | ||||||||||||||||||||||
Stock-based compensation expense and exercises and other | — | (4 | ) | — | — | — | (4 | ) | 1 | (3 | ) | |||||||||||||||||||||
Balances as of June 30, 2019 | $ | 1 | $ | 11,983 | $ | 3,013 | $ | 1,460 | $ | (2,700 | ) | $ | 13,757 | $ | 1,835 | $ | 15,592 | |||||||||||||||
Six months ended June 30, 2018 | ||||||||||||||||||||||||||||||||
Total | ||||||||||||||||||||||||||||||||
Genworth | ||||||||||||||||||||||||||||||||
Accumulated | Financial, | |||||||||||||||||||||||||||||||
Additional | other | Treasury | Inc.’s | |||||||||||||||||||||||||||||
Common | paid-in | comprehensive | Retained | stock, at | stockholders’ | Noncontrolling | Total | |||||||||||||||||||||||||
stock | capital | income (loss) | earnings | cost | equity | interests | equity | |||||||||||||||||||||||||
Balances as of December 31, 2017 | $ | 1 | $ | 11,977 | $ | 3,027 | $ | 1,113 | $ | (2,700 | ) | $ | 13,418 | $ | 1,910 | $ | 15,328 | |||||||||||||||
Cumulative effect of change in accounting, net of taxes | — | — | 131 | (114 | ) | — | 17 | — | 17 | |||||||||||||||||||||||
Repurchase of subsidiary shares | — | — | — | — | — | — | (49 | ) | (49 | ) | ||||||||||||||||||||||
Comprehensive income (loss): | ||||||||||||||||||||||||||||||||
Net income | — | — | — | 302 | — | 302 | 112 | 414 | ||||||||||||||||||||||||
Other comprehensive loss, net of taxes | — | — | (831 | ) | — | — | (831 | ) | (98 | ) | (929 | ) | ||||||||||||||||||||
Total comprehensive income (loss) | (529 | ) | 14 | (515 | ) | |||||||||||||||||||||||||||
Dividends to noncontrolling interests | — | — | — | — | — | — | (50 | ) | (50 | ) | ||||||||||||||||||||||
Stock-based compensation expense and exercises and other | — | 4 | — | — | — | 4 | 6 | 10 | ||||||||||||||||||||||||
Balances as of June 30, 2018 | $ | 1 | $ | 11,981 | $ | 2,327 | $ | 1,301 | $ | (2,700 | ) | $ | 12,910 | $ | 1,831 | $ | 14,741 | |||||||||||||||
Six months ended June 30, 2020 | ||||||||||||||||||||||||||||||||
Total | ||||||||||||||||||||||||||||||||
Genworth | ||||||||||||||||||||||||||||||||
Accumulated | Financial, | |||||||||||||||||||||||||||||||
Additional | other | Treasury | Inc.’s | |||||||||||||||||||||||||||||
Common | paid-in | comprehensive | Retained | stock, at | stockholders’ | Noncontrolling | Total | |||||||||||||||||||||||||
stock | capital | income (loss) | earnings | cost | equity | interests | equity | |||||||||||||||||||||||||
Balances as of December 31, 2019 | $ | 1 | $ | 11,990 | $ | 3,433 | $ | 1,461 | $ | (2,700 | ) | $ | 14,185 | $ | 447 | $ | 14,632 | |||||||||||||||
Cumulative effect of change in accounting, net of taxes | — | — | — | (55 | ) | — | (55 | ) | — | (55 | ) | |||||||||||||||||||||
Comprehensive income (loss): | ||||||||||||||||||||||||||||||||
Net loss | — | — | — | (507 | ) | — | (507 | ) | 17 | (490 | ) | |||||||||||||||||||||
Other comprehensive income (loss), net of taxes | — | — | 1,014 | — | — | 1,014 | (10 | ) | 1,004 | |||||||||||||||||||||||
Total comprehensive income | 507 | 7 | 514 | |||||||||||||||||||||||||||||
Dividends to noncontrolling interests | — | — | — | — | — | — | (9 | ) | (9 | ) | ||||||||||||||||||||||
Stock-based compensation expense and exercises and other | — | 6 | — | — | — | 6 | — | 6 | ||||||||||||||||||||||||
Balances as of June 30, 2020 | $ | 1 | $ | 11,996 | $ | 4,447 | $ | 899 | $ | (2,700 | ) | $ | 14,643 | $ | 445 | $ | 15,088 | |||||||||||||||
Six months ended June 30, 2019 | ||||||||||||||||||||||||||||||||
Total | ||||||||||||||||||||||||||||||||
Genworth | ||||||||||||||||||||||||||||||||
Accumulated | Financial, | |||||||||||||||||||||||||||||||
Additional | other | Treasury | Inc.’s | |||||||||||||||||||||||||||||
Common | paid-in | comprehensive | Retained | stock, at | stockholders’ | Noncontrolling | Total | |||||||||||||||||||||||||
stock | capital | income (loss) | earnings | cost | equity | interests | equity | |||||||||||||||||||||||||
Balances as of December 31, 2018 | $ | 1 | $ | 11,987 | $ | 2,044 | $ | 1,118 | $ | (2,700 | ) | $ | 12,450 | $ | 1,739 | $ | 14,189 | |||||||||||||||
Repurchase of subsidiary shares | — | — | — | — | — | — | (44 | ) | (44 | ) | ||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||
Net income | — | — | — | 342 | — | 342 | 106 | 448 | ||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | 969 | — | — | 969 | 86 | 1,055 | ||||||||||||||||||||||||
Total comprehensive income | 1,311 | 192 | 1,503 | |||||||||||||||||||||||||||||
Dividends to noncontrolling interests | — | — | — | — | — | — | (53 | ) | (53 | ) | ||||||||||||||||||||||
Stock-based compensation expense and exercises and other | — | (4 | ) | — | — | — | (4 | ) | 1 | (3 | ) | |||||||||||||||||||||
Balances as of June 30, 2019 | $ | 1 | $ | 11,983 | $ | 3,013 | $ | 1,460 | $ | (2,700 | ) | $ | 13,757 | $ | 1,835 | $ | 15,592 | |||||||||||||||
Six months ended | ||||||||
June 30, | ||||||||
2019 | 2018 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 448 | $ | 414 | ||||
Adjustments to reconcile net income to net cash from operating activities: | ||||||||
Amortization of fixed maturity securities discounts and premiums | (54 | ) | (62 | ) | ||||
Net investment (gains) losses | (29 | ) | 45 | |||||
Charges assessed to policyholders | (364 | ) | (359 | ) | ||||
Acquisition costs deferred | (35 | ) | (40 | ) | ||||
Amortization of deferred acquisition costs and intangibles | 186 | 216 | ||||||
Deferred income taxes | 134 | 83 | ||||||
Derivative instruments and limited partnerships | 22 | (195 | ) | |||||
Stock-based compensation expense | 12 | 16 | ||||||
Change in certain assets and liabilities: | ||||||||
Accrued investment income and other assets | (290 | ) | (89 | ) | ||||
Insurance reserves | 609 | 691 | ||||||
Current tax liabilities | 27 | (37 | ) | |||||
Other liabilities, policy and contract claims and other policy-related balances | 129 | (122 | ) | |||||
Net cash from operating activities | 795 | 561 | ||||||
Cash flows used by investing activities: | ||||||||
Proceeds from maturities and repayments of investments: | ||||||||
Fixed maturity securities | 1,929 | 1,979 | ||||||
Commercial mortgage loans | 285 | 350 | ||||||
Restricted commercial mortgage loans related to a securitization entity | 6 | 16 | ||||||
Proceeds from sales of investments: | ||||||||
Fixed maturity and equity securities | 2,859 | 1,920 | ||||||
Purchases and originations of investments: | ||||||||
Fixed maturity and equity securities | (4,681 | ) | (4,082 | ) | ||||
Commercial mortgage loans | (561 | ) | (489 | ) | ||||
Other invested assets, net | (227 | ) | 93 | |||||
Policy loans, net | 39 | 15 | ||||||
Net cash used by investing activities | (351 | ) | (198 | ) | ||||
Cash flows used by financing activities: | ||||||||
Deposits to universal life and investment contracts | 444 | 503 | ||||||
Withdrawals from universal life and investment contracts | (1,096 | ) | (1,177 | ) | ||||
Proceeds from issuance of long-term debt | 77 | 441 | ||||||
Repayment and repurchase of long-term debt | (78 | ) | (597 | ) | ||||
Repayment of borrowings related to a securitization entity | — | (12 | ) | |||||
Repurchase of subsidiary shares | (44 | ) | (49 | ) | ||||
Dividends paid to noncontrolling interests | (53 | ) | (50 | ) | ||||
Other, net | 55 | (2 | ) | |||||
Net cash used by financing activities | (695 | ) | (943 | ) | ||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 12 | (52 | ) | |||||
Net change in cash, cash equivalents and restricted cash | (239 | ) | (632 | ) | ||||
Cash, cash equivalents and restricted cash at beginning of period | 2,177 | 2,875 | ||||||
Cash, cash equivalents and restricted cash at end of period | $ | 1,938 | $ | 2,243 | ||||
Six months ended June 30, | ||||||||
2020 | 2019 | |||||||
Cash flows from operating activities: | ||||||||
Net income (loss) | $ | (490 | ) | $ | 448 | |||
Less (income) loss from discontinued operations, net of taxes | 520 | (122 | ) | |||||
Adjustments to reconcile net income (loss) to net cash from operating activities: | ||||||||
Amortization of fixed maturity securities discounts and premiums | (50 | ) | (57 | ) | ||||
Net investment (gains) losses | (7 | ) | (29 | ) | ||||
Charges assessed to policyholders | (314 | ) | (364 | ) | ||||
Acquisition costs deferred | (9 | ) | (16 | ) | ||||
Amortization of deferred acquisition costs and intangibles | 209 | 165 | ||||||
Goodwill impairment | 5 | — | ||||||
Deferred income taxes | 28 | 98 | ||||||
Derivative instruments, limited partnerships and other | 191 | 18 | ||||||
Stock-based compensation expense | 19 | 10 | ||||||
Change in certain assets and liabilities: | ||||||||
Accrued investment income and other assets | (131 | ) | (284 | ) | ||||
Insurance reserves | 674 | 609 | ||||||
Current tax liabilities | (1 | ) | 13 | |||||
Other liabilities, policy and contract claims and other policy-related balances | 655 | 134 | ||||||
Cash from operating activities—discontinued operations | — | 172 | ||||||
Net cash from operating activities | 1,299 | 795 | ||||||
Cash flows used by investing activities: | ||||||||
Proceeds from maturities and repayments of investments: | ||||||||
Fixed maturity securities | 1,687 | 1,774 | ||||||
Commercial mortgage loans | 302 | 291 | ||||||
Other invested assets | 71 | 51 | ||||||
Proceeds from sales of investments: | ||||||||
Fixed maturity and equity securities | 1,657 | 2,362 | ||||||
Purchases and originations of investments: | ||||||||
Fixed maturity and equity securities | (4,166 | ) | (4,054 | ) | ||||
Commercial mortgage loans | (271 | ) | (561 | ) | ||||
Other invested assets | (236 | ) | (235 | ) | ||||
Short-term investments, net | 59 | 3 | ||||||
Policy loans, net | 10 | 39 | ||||||
Cash used by investing activities—discontinued operations | — | (21 | ) | |||||
Net cash used by investing activities | (887 | ) | (351 | ) | ||||
Cash flows used by financing activities: | ||||||||
Deposits to universal life and investment contracts | 516 | 444 | ||||||
Withdrawals from universal life and investment contracts | (914 | ) | (1,096 | ) | ||||
Redemption of non-recourse funding obligations | (315 | ) | — | |||||
Repayment and repurchase of long-term debt | (471 | ) | (1 | ) | ||||
Repurchase of subsidiary shares | — | (22 | ) | |||||
Dividends paid to noncontrolling interests | (9 | ) | (14 | ) | ||||
Other, net | 49 | 55 | ||||||
Cash used by financing activities—discontinued operations | — | (61 | ) | |||||
Net cash used by financing activities | (1,144 | ) | (695 | ) | ||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash (includes $—and $12 related to discontinued operations) | (12 | ) | 12 | |||||
Net change in cash, cash equivalents and restricted cash | (744 | ) | (239 | ) | ||||
Cash, cash equivalents and restricted cash at beginning of period | 3,341 | 2,177 | ||||||
Cash, cash equivalents and restricted cash at end of period | 2,597 | 1,938 | ||||||
Less cash, cash equivalents and restricted cash of discontinued operations at end of period | — | 223 | ||||||
Cash, cash equivalents and restricted cash of continuing operations at end of period | $ | 2,597 | $ | 1,715 | ||||
• | A partial settlement payment in the amount of £100 million ($125 million) paid to AXA S.A. (“AXA”) on July 21 , 2020 in connection with a settlement reached regarding the case titled AXA S.A. v. Genworth Financial International Holdings, LLC et al. As part of the settlement agreement, we issued a secured promissory note agreeing to pay AXA two installments in 2022. Under the settlement, certain cash flows to GenworthHoldings, including dividends and capital raises, above defined thresholds must be paid to AXA until the promissory note is fully repaid. In addition, over the next year, we expect to pay AXA approximately $25 million in interest on the promissory note, assuming we do not make any pre-payments, and we may make an additional one-time payment of approximately $40 million for an |
unrelated liability and other expenses. See note 12 for additional details on the case. See note 14 for additional details related to the sale of our former lifestyle protection insurance business and amounts recorded related to loss from discontinued operations. |
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions, except per share amounts) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Weighted-average shares used in basic earnings per share calculations | 503.4 | 500.6 | 502.3 | 500.1 | ||||||||||||
Potentially dilutive securities: | ||||||||||||||||
Stock options, restricted stock units and stock appreciation rights | 5.3 | 2.0 | 6.4 | 2.5 | ||||||||||||
Weighted-average shares used in diluted earnings per share calculations | 508.7 | 502.6 | 508.7 | 502.6 | ||||||||||||
Net income: | ||||||||||||||||
Net income | $ | 218 | $ | 249 | $ | 448 | $ | 414 | ||||||||
Less: net income attributable to noncontrolling interests | 50 | 59 | 106 | 112 | ||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | $ | 168 | $ | 190 | $ | 342 | $ | 302 | ||||||||
Basic earnings per share: | ||||||||||||||||
Net income | $ | 0.44 | $ | 0.50 | $ | 0.89 | $ | 0.83 | ||||||||
Less: net income attributable to noncontrolling interests | 0.10 | 0.12 | 0.21 | 0.22 | ||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders (1) | $ | 0.33 | $ | 0.38 | $ | 0.68 | $ | 0.60 | ||||||||
Diluted earnings per share: | ||||||||||||||||
Net income | $ | 0.43 | $ | 0.50 | $ | 0.88 | $ | 0.82 | ||||||||
Less: net income attributable to noncontrolling interests | 0.10 | 0.12 | 0.21 | 0.22 | ||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | $ | 0.33 | $ | 0.38 | $ | 0.67 | $ | 0.60 | ||||||||
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions, except per share amounts) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Weighted-average shares used in basic earnings per share calculations | 505.4 | 503.4 | 504.8 | 502.3 | ||||||||||||
Potentially dilutive securities: | ||||||||||||||||
Stock options, restricted stock units and stock appreciation rights | 7.1 | 5.3 | 6.3 | 6.4 | ||||||||||||
Weighted-average shares used in diluted earnings per share calculations | 512.5 | 508.7 | 511.1 | 508.7 | ||||||||||||
Income from continuing operations: | �� | |||||||||||||||
Income from continuing operations | $ | 102 | $ | 158 | $ | 30 | $ | 326 | ||||||||
Less: net income from continuing operations attributable to noncontrolling interests | 23 | 15 | 17 | 35 | ||||||||||||
Income from continuing operations available to Genworth Financial, Inc.’s common stockholders | $ | 79 | $ | 143 | $ | 13 | $ | 291 | ||||||||
Basic per share | $ | 0.16 | $ | 0.29 | $ | 0.03 | $ | 0.58 | ||||||||
Diluted per share | $ | 0.15 | $ | 0.28 | $ | 0.03 | $ | 0.57 | ||||||||
Income (loss) from discontinued operations: | ||||||||||||||||
Income (loss) from discontinued operations, net of taxes | $ | (520 | ) | $ | 60 | $ | (520 | ) | $ | 122 | ||||||
Less: net income from discontinued operations attributable to noncontrolling interests | — | 35 | — | 71 | ||||||||||||
Income (loss) from discontinued operations available to Genworth Financial, Inc.’s common stockholders | $ | (520 | ) | $ | 25 | $ | (520 | ) | $ | 51 | ||||||
Basic per share | $ | (1.03 | ) | $ | 0.05 | $ | (1.03 | ) | $ | 0.10 | ||||||
Diluted per share | $ | (1.01 | ) | $ | 0.05 | $ | (1.02 | ) | $ | 0.10 | ||||||
Net income (loss): | ||||||||||||||||
Income from continuing operations | $ | 102 | $ | 158 | $ | 30 | $ | 326 | ||||||||
Income (loss) from discontinued operations, net of taxes | (520 | ) | 60 | (520 | ) | 122 | ||||||||||
Net income (loss) | (418 | ) | 218 | (490 | ) | 448 | ||||||||||
Less: net income attributable to noncontrolling interests | 23 | 50 | 17 | 106 | ||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (441 | ) | $ | 168 | $ | (507 | ) | $ | 342 | ||||||
Basic per share (1) | $ | (0.87 | ) | $ | 0.33 | $ | (1.00 | ) | $ | 0.68 | ||||||
Diluted per share | $ | (0.86 | ) | $ | 0.33 | $ | (0.99 | ) | $ | 0.67 | ||||||
(1) | May not total due to whole number calculation. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Fixed maturity securities—taxable | $ | 665 | $ | 651 | $ | 1,308 | $ | 1,286 | ||||||||
Fixed maturity securities—non-taxable | 2 | 3 | 4 | 6 | ||||||||||||
Equity securities | 10 | 10 | 19 | 20 | ||||||||||||
Commercial mortgage loans | 84 | 77 | 165 | 159 | ||||||||||||
Restricted commercial mortgage loans related to a securitization entity | 1 | 2 | 2 | 4 | ||||||||||||
Policy loans | 45 | 41 | 91 | 84 | ||||||||||||
Other invested assets | 59 | 53 | 118 | 92 | ||||||||||||
Cash, cash equivalents, restricted cash and short-term investments | 11 | 14 | 23 | 26 | ||||||||||||
Gross investment income before expenses and fees | 877 | 851 | 1,730 | 1,677 | ||||||||||||
Expenses and fees | (25 | ) | (23 | ) | (49 | ) | (45 | ) | ||||||||
Net investment income | $ | 852 | $ | 828 | $ | 1,681 | $ | 1,632 | ||||||||
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Fixed maturity securities—taxable | $ | 601 | $ | 634 | $ | 1,223 | $ | 1,247 | ||||||||
Fixed maturity securities—non-taxable | 1 | 2 | 3 | 4 | ||||||||||||
Equity securities | 2 | 5 | 4 | 9 | ||||||||||||
Commercial mortgage loans | 84 | 85 | 169 | 167 | ||||||||||||
Policy loans | 49 | 45 | 98 | 91 | ||||||||||||
Other invested assets | 66 | 59 | 113 | 118 | ||||||||||||
Cash, cash equivalents, restricted cash and short-term investments | 4 | 11 | 15 | 22 | ||||||||||||
Gross investment income before expenses and fees | 807 | 841 | 1,625 | 1,658 | ||||||||||||
Expenses and fees | (21 | ) | (25 | ) | (46 | ) | (48 | ) | ||||||||
Net investment income | $ | 786 | $ | 816 | $ | 1,579 | $ | 1,610 | ||||||||
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Available-for-sale fixed maturity securities: | ||||||||||||||||
Realized gains | $ | 5 | $ | 13 | $ | 86 | $ | 20 | ||||||||
Realized losses | (6 | ) | (21 | ) | (28 | ) | (37 | ) | ||||||||
Net realized gains (losses) on available-for-sale fixed maturity securities | (1 | ) | (8 | ) | 58 | (17 | ) | |||||||||
Impairments: | ||||||||||||||||
Total other-than-temporary impairments | — | — | — | — | ||||||||||||
Portion of other-than-temporary impairments included inother comprehensive income (loss) | — | — | — | — | ||||||||||||
Net other-than-temporary impairments | — | — | — | — | ||||||||||||
Net realized gains (losses) on equity securities sold | — | 8 | 3 | 10 | ||||||||||||
Net unrealized gains (losses) on equity securities still held | (12 | ) | 3 | (4 | ) | (15 | ) | |||||||||
Limited partnerships | (11 | ) | (2 | ) | 4 | 5 | ||||||||||
Commercial mortgage loans | 1 | — | — | — | ||||||||||||
Derivative instruments (1) | (22 | ) | (15 | ) | (32 | ) | (28 | ) | ||||||||
Net investment gains (losses) | $ | (45 | ) | $ | (14 | ) | $ | 29 | $ | (45 | ) | |||||
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Available-for-sale | ||||||||||||||||
Realized gains | $ | 119 | $ | 10 | $ | 133 | $ | 74 | ||||||||
Realized losses | (5 | ) | (21 | ) | (6 | ) | (27 | ) | ||||||||
Net realized gains (losses) on available-for-sale | 114 | (11 | ) | 127 | 47 | |||||||||||
Impairments: | ||||||||||||||||
Total other-than-temporary impairments | — | — | — | — | ||||||||||||
Portion of other-than-temporary impairments included in other comprehensive income (loss) | — | — | — | — | ||||||||||||
Net other-than-temporary impairments | — | — | — | — | ||||||||||||
Net change in allowance for credit losses on available-for-sale | (7 | ) | — | (7 | ) | — | ||||||||||
Net realized gains (losses) on equity securities sold | — | — | — | 3 | ||||||||||||
Net unrealized gains (losses) on equity securities still held | 9 | 5 | (10 | ) | 17 | |||||||||||
Limited partnerships | 37 | (11 | ) | (3 | ) | 4 | ||||||||||
Commercial mortgage loans | 1 | 1 | 1 | — | ||||||||||||
Derivative instruments (1) | 10 | (30 | ) | (95 | ) | (42 | ) | |||||||||
Other | (5 | ) | — | (6 | ) | — | ||||||||||
Net investment gains (losses) | $ | 159 | $ | (46 | ) | $ | 7 | $ | 29 | |||||||
(1) | See note 5 for additional information on the impact of derivative instruments included in net investment gains (losses). |
Increase from | Increase | |||||||||||||||||||||||||||||||
securities | (decrease) | Decrease | ||||||||||||||||||||||||||||||
without | from securities | due to change | ||||||||||||||||||||||||||||||
allowance in | with allowance | in intent or | ||||||||||||||||||||||||||||||
Beginning | previous | in previous | Securities | requirement | Ending | |||||||||||||||||||||||||||
(Amounts in millions) | balance | periods | periods | sold | to sell | Write-offs | Recoveries | balance | ||||||||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||||||||||||||
Non-U.S. corporate | $ | — | $ | 4 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 4 | ||||||||||||||||
Commercial mortgage-backed | — | 3 | — | — | — | — | — | 3 | ||||||||||||||||||||||||
Total available-for-sale | $ | — | $ | 7 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 7 | ||||||||||||||||
As of or for the three months ended June 30, | As of or for the six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Beginning balance | $ | 23 | $ | 28 | $ | 24 | $ | 32 | ||||||||
Reductions: | ||||||||||||||||
Securities sold, paid down or disposed | — | (3 | ) | (1 | ) | (7 | ) | |||||||||
Ending balance | $ | 23 | $ | 25 | $ | 23 | $ | 25 | ||||||||
Three months | Six months | |||||||
ended | ended | |||||||
June 30, | June 30, | |||||||
(Amounts in millions) | 2019 | 2019 | ||||||
Beginning balance | $ | 23 | $ | 24 | ||||
Reductions: | ||||||||
Securities sold, paid down or disposed | — | (1 | ) | |||||
Ending balance | $ | 23 | $ | 23 | ||||
(Amounts in millions) | June 30, 2019 | December 31, 2018 | ||||||
Net unrealized gains (losses) on fixed maturity securities (1) | $ | 5,673 | $ | 1,775 | ||||
Adjustments to deferred acquisition costs, present value of future profits, salesinducements and benefit reserves | (3,879 | ) | (952 | ) | ||||
Income taxes, net | (405 | ) | (190 | ) | ||||
Net unrealized investment gains (losses) | 1,389 | 633 | ||||||
Less: net unrealized investment gains (losses) attributable to noncontrolling interests | 84 | 38 | ||||||
Net unrealized investment gains (losses) attributable to Genworth Financial, Inc. | $ | 1,305 | $ | 595 | ||||
|
(1) | Excludes foreign exchange. |
As of or for the three months ended June 30, | ||||||||
(Amounts in millions) | 2019 | 2018 | ||||||
Beginning balance | $ | 943 | $ | 917 | ||||
Unrealized gains (losses) arising during the period: | ||||||||
Unrealized gains (losses) on fixed maturity securities | 1,957 | (905 | ) | |||||
Adjustment to deferred acquisition costs | (52 | ) | 467 | |||||
Adjustment to present value of future profits | (2 | ) | 20 | |||||
Adjustment to sales inducements | (12 | ) | 9 | |||||
Adjustment to benefit reserves | (1,412 | ) | 162 | |||||
Provision for income taxes | (104 | ) | 54 | |||||
Change in unrealized gains (losses) on investment securities | 375 | (193 | ) | |||||
Reclassification adjustments to net investment (gains) losses, net of taxes of $(1) and $(2) | 1 | 6 | ||||||
Change in net unrealized investment gains (losses) | 376 | (187 | ) | |||||
Less: change in net unrealized investment gains (losses) attributable to noncontrolling interests | 14 | (6 | ) | |||||
Ending balance | $ | 1,305 | $ | 736 | ||||
As of or for the six months ended June 30, | ||||||||
(Amounts in millions) | 2019 | 2018 | ||||||
Beginning balance | $ | 595 | $ | 1,085 | ||||
Cumulative effect of changes in accounting: | ||||||||
Stranded tax effects | — | 189 | ||||||
Recognition and measurement of financial assets and liabilities, net of taxes of $— and $18 | — | (25 | ) | |||||
Total cumulative effect of changes in accounting | — | 164 | ||||||
Unrealized gains (losses) arising during the period: | ||||||||
Unrealized gains (losses) on fixed maturity securities | 3,956 | (2,586 | ) | |||||
Adjustment to deferred acquisition costs | (1,041 | ) | 909 | |||||
Adjustment to present value of future profits | (55 | ) | 56 | |||||
Adjustment to sales inducements | (31 | ) | 29 | |||||
Adjustment to benefit reserves | (1,800 | ) | 902 | |||||
Provision for income taxes | (227 | ) | 149 | |||||
Change in unrealized gains (losses) on investment securities | 802 | (541 | ) | |||||
Reclassification adjustments to net investment (gains) losses, net of taxes of $12 and $(3) | (46 | ) | 13 | |||||
Change in net unrealized investment gains (losses) | 756 | (528 | ) | |||||
Less: change in net unrealized investment gains (losses) attributable to noncontrolling interests | 46 | (15 | ) | |||||
Ending balance | $ | 1,305 | $ | 736 | ||||
As of or for the | ||||||||
three months ended | ||||||||
June 30, | ||||||||
(Amounts in millions) | 2020 | 2019 | ||||||
Beginning balance | $ | 1,140 | $ | 943 | ||||
Unrealized gains (losses) arising during the period: | ||||||||
Unrealized gains (losses) on fixed maturity securities | 3,911 | 1,957 | ||||||
Adjustment to deferred acquisition costs | (111 | ) | (52 | ) | ||||
Adjustment to present value of future profits | 5 | (2 | ) | |||||
Adjustment to sales inducements | (34 | ) | (12 | ) | ||||
Adjustment to benefit reserves | (2,802 | ) | (1,412 | ) | ||||
Provision for income taxes | (207 | ) | (104 | ) | ||||
Change in unrealized gains (losses) on investment securities | 762 | 375 | ||||||
Reclassification adjustments to net investment (gains) losses, net of taxes of $24 and $(1) | (88 | ) | 1 | |||||
Change in net unrealized investment gains (losses) | 674 | 376 | ||||||
Less: change in net unrealized investment gains (losses) attributable to noncontrolling interests | 3 | 14 | ||||||
Ending balance | $ | 1,811 | $ | 1,305 | ||||
As of or for the | ||||||||
six months ended | ||||||||
June 30, | ||||||||
(Amounts in millions) | 2020 | 2019 | ||||||
Beginning balance | $ | 1,456 | $ | 595 | ||||
Unrealized gains (losses) arising during the period: | ||||||||
Unrealized gains (losses) on fixed maturity securities | 2,199 | 3,956 | ||||||
Adjustment to deferred acquisition costs | 57 | (1,041 | ) | |||||
Adjustment to present value of future profits | 4 | (55 | ) | |||||
Adjustment to sales inducements | 2 | (31 | ) | |||||
Adjustment to benefit reserves | (1,694 | ) | (1,800 | ) | ||||
Provision for income taxes | (120 | ) | (227 | ) | ||||
Change in unrealized gains (losses) on investment securities | 448 | 802 | ||||||
Reclassification adjustments to net investment (gains) losses, net of taxes of $25 and $12 | (94 | ) | (46 | ) | ||||
Change in net unrealized investment gains (losses) | 354 | 756 | ||||||
Less: change in net unrealized investment gains (losses) attributable to noncontrolling interests | (1 | ) | 46 | |||||
Ending balance | $ | 1,811 | $ | 1,305 | ||||
Amortized | Gross | Gross | Allowance | |||||||||||||||||
cost or | unrealized | unrealized | for credit | Fair | ||||||||||||||||
(Amounts in millions) | cost | gains | losses | losses | value | |||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises | $ | 3,877 | $ | 1,725 | $ | — | $ | — | $ | 5,602 | ||||||||||
State and political subdivisions | 2,503 | 496 | (1 | ) | — | 2,998 | ||||||||||||||
Non-U.S. government | 1,424 | 125 | (7 | ) | — | 1,542 | ||||||||||||||
U.S. corporate: | ||||||||||||||||||||
Utilities | 4,392 | 879 | (1 | ) | — | 5,270 | ||||||||||||||
Energy | 2,454 | 203 | (63 | ) | — | 2,594 | ||||||||||||||
Finance and insurance | 7,400 | 1,017 | (14 | ) | — | 8,403 | ||||||||||||||
Consumer—non-cyclical | 5,132 | 1,147 | (2 | ) | — | 6,277 | ||||||||||||||
Technology and communications | 2,912 | 503 | (4 | ) | — | 3,411 | ||||||||||||||
Industrial | 1,350 | 157 | (4 | ) | — | 1,503 | ||||||||||||||
Capital goods | 2,580 | 454 | (6 | ) | — | 3,028 | ||||||||||||||
Consumer—cyclical | 1,748 | 224 | (6 | ) | — | 1,966 | ||||||||||||||
Transportation | 1,335 | 254 | (24 | ) | — | 1,565 | ||||||||||||||
Other | 340 | 38 | — | — | 378 | |||||||||||||||
Total U.S. corporate | 29,643 | 4,876 | (124 | ) | — | 34,395 | ||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||
Utilities | 811 | 68 | — | — | 879 | |||||||||||||||
Energy | 1,141 | 148 | (14 | ) | — | 1,275 | ||||||||||||||
Finance and insurance | 2,199 | 284 | (16 | ) | (1 | ) | 2,466 | |||||||||||||
Consumer—non-cyclical | 692 | 86 | (1 | ) | — | 777 | ||||||||||||||
Technology and communications | 1,066 | 182 | (1 | ) | — | 1,247 | ||||||||||||||
Industrial | 883 | 116 | (4 | ) | — | 995 | ||||||||||||||
Capital goods | 565 | 50 | (2 | ) | — | 613 | ||||||||||||||
Consumer—cyclical | 380 | 27 | — | — | 407 | |||||||||||||||
Transportation | 560 | 84 | (6 | ) | (3 | ) | 635 | |||||||||||||
Other | 1,376 | 218 | (3 | ) | — | 1,591 | ||||||||||||||
Total non-U.S. corporate | 9,673 | 1,263 | (47 | ) | (4 | ) | 10,885 | |||||||||||||
Residential mortgage-backed | 1,927 | 259 | (2 | ) | — | 2,184 | ||||||||||||||
Commercial mortgage-backed | 2,800 | 225 | (52 | ) | (3 | ) | 2,970 | |||||||||||||
Other asset-backed | 2,987 | 30 | (49 | ) | — | 2,968 | ||||||||||||||
Total available-for-sale | $ | 54,834 | $ | 8,999 | $ | (282 | ) | $ | (7 | ) | $ | 63,544 | ||||||||
Gross unrealized gains | Gross unrealized losses | ||||||||||||||||||||||||
(Amounts in millions) | Amortized cost or cost | Not other-than- temporarily impaired | Other-than- temporarily impaired | Not other-than- temporarily impaired | Other-than- temporarily impaired | Fair value | |||||||||||||||||||
Fixed maturity securities: | |||||||||||||||||||||||||
U.S. government, agencies and government- sponsored enterprises | $ | 4,151 | $ | 837 | $ | — | $ | (1 | ) | $ | — | $ | 4,987 | ||||||||||||
State and political subdivisions | 2,319 | 317 | — | — | — | 2,636 | |||||||||||||||||||
Non-U.S. government | 2,496 | 155 | — | (2 | ) | — | 2,649 | ||||||||||||||||||
U.S. corporate: | |||||||||||||||||||||||||
Utilities | 4,327 | 565 | — | (13 | ) | — | 4,879 | ||||||||||||||||||
Energy | 2,468 | 255 | — | (10 | ) | — | 2,713 | ||||||||||||||||||
Finance and insurance | 6,974 | 633 | — | (10 | ) | — | 7,597 | ||||||||||||||||||
Consumer—non-cyclical | 4,954 | 616 | — | (18 | ) | — | 5,552 | ||||||||||||||||||
Technology and communications | 2,893 | 269 | — | (6 | ) | — | 3,156 | ||||||||||||||||||
Industrial | 1,242 | 98 | — | (4 | ) | — | 1,336 | ||||||||||||||||||
Capital goods | 2,323 | 303 | — | (6 | ) | — | 2,620 | ||||||||||||||||||
Consumer—cyclical | 1,619 | 127 | — | (5 | ) | — | 1,741 | ||||||||||||||||||
Transportation | 1,263 | 152 | — | (4 | ) | — | 1,411 | ||||||||||||||||||
Other | 356 | 40 | — | — | — | 396 | |||||||||||||||||||
Total U.S. corporate | 28,419 | 3,058 | — | (76 | ) | — | 31,401 | ||||||||||||||||||
Non-U.S. corporate: | |||||||||||||||||||||||||
Utilities | 1,114 | 54 | — | (3 | ) | — | 1,165 | ||||||||||||||||||
Energy | 1,349 | 168 | — | (1 | ) | — | 1,516 | ||||||||||||||||||
Finance and insurance | 2,438 | 191 | — | (1 | ) | — | 2,628 | ||||||||||||||||||
Consumer—non-cyclical | 674 | 40 | — | (4 | ) | — | 710 | ||||||||||||||||||
Technology and communications | 1,179 | 94 | — | — | — | 1,273 | |||||||||||||||||||
Industrial | 936 | 81 | — | — | — | 1,017 | |||||||||||||||||||
Capital goods | 663 | 33 | — | (1 | ) | — | 695 | ||||||||||||||||||
Consumer—cyclical | 542 | 16 | — | (1 | ) | — | 557 | ||||||||||||||||||
Transportation | 761 | 82 | — | (2 | ) | — | 841 | ||||||||||||||||||
Other | 2,061 | 186 | — | (2 | ) | — | 2,245 | ||||||||||||||||||
Total non-U.S. corporate | 11,717 | 945 | — | (15 | ) | — | 12,647 | ||||||||||||||||||
Residential mortgage-backed | 2,511 | 215 | 14 | (2 | ) | — | 2,738 | ||||||||||||||||||
Commercial mortgage-backed | 2,882 | 121 | — | (14 | ) | — | 2,989 | ||||||||||||||||||
Other asset-backed | 3,699 | 38 | — | (10 | ) | — | 3,727 | ||||||||||||||||||
Total available-for-sale fixedmaturity securities | $ | 58,194 | $ | 5,686 | $ | 14 | $ | (120 | ) | $ | — | $ | 63,774 | ||||||||||||
Gross unrealized gains | Gross unrealized losses | |||||||||||||||||||||||
Amortized | Not other-than- | Other-than- | Not other-than- | Other-than- | ||||||||||||||||||||
cost or | temporarily | temporarily | temporarily | temporarily | Fair | |||||||||||||||||||
(Amounts in millions) | cost | impaired | impaired | impaired | impaired | value | ||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises | $ | 4,073 | $ | 952 | $ | — | $ | — | $ | — | $ | 5,025 | ||||||||||||
State and political subdivisions | 2,394 | 355 | — | (2 | ) | — | 2,747 | |||||||||||||||||
Non-U.S. government | 1,235 | 117 | — | (2 | ) | — | 1,350 | |||||||||||||||||
U.S. corporate: | ||||||||||||||||||||||||
Utilities | 4,322 | 675 | — | — | — | 4,997 | ||||||||||||||||||
Energy | 2,404 | 303 | — | (8 | ) | — | 2,699 | |||||||||||||||||
Finance and insurance | 6,977 | 798 | — | (1 | ) | — | 7,774 | |||||||||||||||||
Consumer—non-cyclical | 4,909 | 796 | — | (4 | ) | — | 5,701 | |||||||||||||||||
Technology and communications | 2,883 | 363 | — | (1 | ) | — | 3,245 | |||||||||||||||||
Industrial | 1,271 | 125 | — | — | — | 1,396 | ||||||||||||||||||
Capital goods | 2,345 | 367 | — | (1 | ) | — | 2,711 | |||||||||||||||||
Consumer—cyclical | 1,590 | 172 | — | (2 | ) | — | 1,760 | |||||||||||||||||
Transportation | 1,320 | 187 | — | (1 | ) | — | 1,506 | |||||||||||||||||
Other | 292 | 30 | — | — | — | 322 | ||||||||||||||||||
Total U.S. corporate | 28,313 | 3,816 | — | (18 | ) | — | 32,111 | |||||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||||||
Utilities | 779 | 50 | — | — | — | 829 | ||||||||||||||||||
Energy | 1,140 | 179 | — | — | — | 1,319 | ||||||||||||||||||
Finance and insurance | 2,087 | 232 | — | — | — | 2,319 | ||||||||||||||||||
Consumer—non-cyclical | 631 | 55 | — | (2 | ) | — | 684 | |||||||||||||||||
Technology and communications | 1,010 | 128 | — | — | — | 1,138 | ||||||||||||||||||
Industrial | 896 | 92 | — | — | — | 988 | ||||||||||||||||||
Capital goods | 565 | 40 | — | — | — | 605 | ||||||||||||||||||
Consumer—cyclical | 373 | 24 | — | — | — | 397 | ||||||||||||||||||
Transportation | 557 | 73 | — | (1 | ) | — | 629 | |||||||||||||||||
Other | 1,431 | 188 | — | (2 | ) | — | 1,617 | |||||||||||||||||
Total non-U.S. corporate | 9,469 | 1,061 | — | (5 | ) | — | 10,525 | |||||||||||||||||
Residential mortgage-backed | 2,057 | 199 | 15 | (1 | ) | — | 2,270 | |||||||||||||||||
Commercial mortgage-backed | 2,897 | 137 | — | (8 | ) | — | 3,026 | |||||||||||||||||
Other asset-backed | 3,262 | 30 | — | (7 | ) | — | 3,285 | |||||||||||||||||
Total available-for-sale | $ | 53,700 | $ | 6,667 | $ | 15 | $ | (43 | ) | $ | — | $ | 60,339 | |||||||||||
Gross unrealized gains | Gross unrealized losses | ||||||||||||||||||||||||
(Amounts in millions) | Amortized cost or cost | Not other-than- temporarily impaired | Other-than- temporarily impaired | Not other-than- temporarily impaired | Other-than- temporarily impaired | Fair value | |||||||||||||||||||
Fixed maturity securities: | |||||||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises | $ | 4,175 | $ | 473 | $ | — | $ | (17 | ) | $ | — | $ | 4,631 | ||||||||||||
State and political subdivisions | 2,406 | 168 | — | (22 | ) | — | 2,552 | ||||||||||||||||||
Non-U.S. government | 2,345 | 72 | — | (24 | ) | — | 2,393 | ||||||||||||||||||
U.S. corporate: | |||||||||||||||||||||||||
Utilities | 4,439 | 331 | — | (95 | ) | — | 4,675 | ||||||||||||||||||
Energy | 2,382 | 101 | — | (64 | ) | — | 2,419 | ||||||||||||||||||
Finance and insurance | 6,705 | 249 | — | (132 | ) | — | 6,822 | ||||||||||||||||||
Consumer—non-cyclical | 4,891 | 294 | — | (137 | ) | — | 5,048 | ||||||||||||||||||
Technology and communications | 2,823 | 110 | — | (78 | ) | — | 2,855 | ||||||||||||||||||
Industrial | 1,230 | 41 | — | (33 | ) | — | 1,238 | ||||||||||||||||||
Capital goods | 2,277 | 165 | — | (51 | ) | — | 2,391 | ||||||||||||||||||
Consumer—cyclical | 1,592 | 53 | — | (48 | ) | — | 1,597 | ||||||||||||||||||
Transportation | 1,283 | 78 | — | (41 | ) | — | 1,320 | ||||||||||||||||||
Other | 376 | 24 | — | (3 | ) | — | 397 | ||||||||||||||||||
Total U.S. corporate | 27,998 | 1,446 | — | (682 | ) | — | 28,762 | ||||||||||||||||||
Non-U.S. corporate: | |||||||||||||||||||||||||
Utilities | 1,056 | 17 | — | (32 | ) | — | 1,041 | ||||||||||||||||||
Energy | 1,320 | 72 | — | (23 | ) | — | 1,369 | ||||||||||||||||||
Finance and insurance | 2,391 | 72 | — | (40 | ) | — | 2,423 | ||||||||||||||||||
Consumer—non-cyclical | 756 | 8 | — | (25 | ) | — | 739 | ||||||||||||||||||
Technology and communications | 1,168 | 23 | — | (26 | ) | — | 1,165 | ||||||||||||||||||
Industrial | 926 | 36 | — | (17 | ) | — | 945 | ||||||||||||||||||
Capital goods | 615 | 10 | — | (10 | ) | — | 615 | ||||||||||||||||||
Consumer—cyclical | 532 | 1 | — | (13 | ) | — | 520 | ||||||||||||||||||
Transportation | 689 | 46 | — | (15 | ) | — | 720 | ||||||||||||||||||
Other | 2,218 | 105 | — | (23 | ) | — | 2,300 | ||||||||||||||||||
Total non-U.S. corporate | 11,671 | 390 | — | (224 | ) | — | 11,837 | ||||||||||||||||||
Residential mortgage-backed | 2,888 | 160 | 13 | (17 | ) | — | 3,044 | ||||||||||||||||||
Commercial mortgage-backed | 3,054 | 43 | — | (81 | ) | — | 3,016 | ||||||||||||||||||
Other asset-backed | 3,444 | 10 | 1 | (29 | ) | — | 3,426 | ||||||||||||||||||
Total available-for-sale fixed maturity securities | $ | 57,981 | $ | 2,762 | $ | 14 | $ | (1,096 | ) | $ | — | $ | 59,661 | ||||||||||||
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||||||||||||||
(Dollar amounts in millions) | Fair value | Gross unrealized losses | Number of securities | Fair value | Gross unrealized losses | Number of securities | Fair value | Gross unrealized losses | Number of securities | |||||||||||||||||||||||||||
Description of Securities | ||||||||||||||||||||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||||||||||||||||||
U.S. government, agenciesand government-sponsored enterprises | $ | — | $ | — | — | $ | 51 | $ | (1 | ) | 9 | $ | 51 | $ | (1 | ) | 9 | |||||||||||||||||||
Non-U.S. government | — | — | — | 198 | (2 | ) | 14 | 198 | (2 | ) | 14 | |||||||||||||||||||||||||
U.S. corporate | 372 | (15 | ) | 33 | 1,907 | (61 | ) | 256 | 2,279 | (76 | ) | 289 | ||||||||||||||||||||||||
Non-U.S. corporate | 34 | (2 | ) | 5 | 526 | (13 | ) | 82 | 560 | (15 | ) | 87 | ||||||||||||||||||||||||
Residential mortgage-backed | — | — | — | 166 | (2 | ) | 39 | 166 | (2 | ) | 39 | |||||||||||||||||||||||||
Commercial mortgage-backed | — | — | — | 399 | (14 | ) | 53 | 399 | (14 | ) | 53 | |||||||||||||||||||||||||
Other asset-backed | 832 | (5 | ) | 160 | 425 | (5 | ) | 101 | 1,257 | (10 | ) | 261 | ||||||||||||||||||||||||
Total for fixed maturity securities inan unrealized loss position | $ | 1,238 | $ | (22 | ) | 198 | $ | 3,672 | $ | (98 | ) | 554 | $ | 4,910 | $ | (120 | ) | 752 | ||||||||||||||||||
% Below cost: | ||||||||||||||||||||||||||||||||||||
<20% Below cost | $ | 1,238 | $ | (22 | ) | 198 | $ | 3,647 | $ | (88 | ) | 549 | $ | 4,885 | $ | (110 | ) | 747 | ||||||||||||||||||
20%-50% Below cost | — | — | — | 22 | (7 | ) | 3 | 22 | (7 | ) | 3 | |||||||||||||||||||||||||
>50% Below cost | — | — | — | 3 | (3 | ) | 2 | 3 | (3 | ) | 2 | |||||||||||||||||||||||||
Total for fixed maturity securities inan unrealized loss position | $ | 1,238 | $ | (22 | ) | 198 | $ | 3,672 | $ | (98 | ) | 554 | $ | 4,910 | $ | (120 | ) | 752 | ||||||||||||||||||
Investment grade | $ | 1,096 | $ | (11 | ) | 185 | $ | 3,463 | $ | (83 | ) | 524 | $ | 4,559 | $ | (94 | ) | 709 | ||||||||||||||||||
Below investment grade | 142 | (11 | ) | 13 | 209 | (15 | ) | 30 | 351 | (26 | ) | 43 | ||||||||||||||||||||||||
Total for fixed maturity securities inan unrealized loss position | $ | 1,238 | $ | (22 | ) | 198 | $ | 3,672 | $ | (98 | ) | 554 | $ | 4,910 | $ | (120 | ) | 752 | ||||||||||||||||||
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||||||||||||||
Gross | Gross | Gross | ||||||||||||||||||||||||||||||||||
Fair | unrealized | Number of | Fair | unrealized | Number of | Fair | unrealized | Number of | ||||||||||||||||||||||||||||
(Dollar amounts in millions) | value | losses | securities | value | losses | securities | value | losses | securities | |||||||||||||||||||||||||||
Description of Securities | ||||||||||||||||||||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||||||||||||||||||
State and political subdivisions | $ | 23 | $ | (1 | ) | 6 | $ | — | $ | — | — | $ | 23 | $ | (1 | ) | 6 | |||||||||||||||||||
Non-U.S. government | 207 | (7 | ) | 18 | — | — | — | 207 | (7 | ) | 18 | |||||||||||||||||||||||||
U.S. corporate | 1,785 | (107 | ) | 291 | 182 | (17 | ) | 18 | 1,967 | (124 | ) | 309 | ||||||||||||||||||||||||
Non-U.S. corporate | 613 | (37 | ) | 125 | 12 | (2 | ) | 2 | 625 | (39 | ) | 127 | ||||||||||||||||||||||||
Residential mortgage-backed | 36 | (1 | ) | 11 | 8 | (1 | ) | 4 | 44 | (2 | ) | 15 | ||||||||||||||||||||||||
Commercial mortgage-backed | 625 | (50 | ) | 105 | — | — | — | 625 | (50 | ) | 105 | |||||||||||||||||||||||||
Other asset-backed | 1,329 | (38 | ) | 291 | 263 | (11 | ) | 62 | 1,592 | (49 | ) | 353 | ||||||||||||||||||||||||
Total for fixed maturity securities in an unrealized loss position | $ | 4,618 | $ | (241 | ) | 847 | $ | 465 | $ | (31 | ) | 86 | $ | 5,083 | $ | (272 | ) | 933 | ||||||||||||||||||
% Below cost: | ||||||||||||||||||||||||||||||||||||
<20% Below cost | $ | 4,538 | $ | (211 | ) | 825 | $ | 442 | $ | (24 | ) | 83 | $ | 4,980 | $ | (235 | ) | 908 | ||||||||||||||||||
20%-50% Below cost | 80 | (30 | ) | 22 | 22 | (6 | ) | 2 | 102 | (36 | ) | 24 | ||||||||||||||||||||||||
>50% Below cost | — | — | — | 1 | (1 | ) | 1 | 1 | (1 | ) | 1 | |||||||||||||||||||||||||
Total for fixed maturity securities in an unrealized loss position | $ | 4,618 | $ | (241 | ) | 847 | $ | 465 | $ | (31 | ) | 86 | $ | 5,083 | $ | (272 | ) | 933 | ||||||||||||||||||
Investment grade | $ | 3,731 | $ | (163 | ) | 701 | $ | 330 | $ | (18 | ) | 71 | $ | 4,061 | $ | (181 | ) | 772 | ||||||||||||||||||
Below investment grade | 887 | (78 | ) | 146 | 135 | (13 | ) | 15 | 1,022 | (91 | ) | 161 | ||||||||||||||||||||||||
Total for fixed maturity securities in an unrealized loss position | $ | 4,618 | $ | (241 | ) | 847 | $ | 465 | $ | (31 | ) | 86 | $ | 5,083 | $ | (272 | ) | 933 | ||||||||||||||||||
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||||||||||||||
(Dollar amounts in millions) | Fair value | Gross unrealized losses | Number of securities | Fair value | Gross unrealized losses | Number of securities | Fair value | Gross unrealized losses | Number of securities | |||||||||||||||||||||||||||
Description of Securities | ||||||||||||||||||||||||||||||||||||
U.S. corporate: | ||||||||||||||||||||||||||||||||||||
Utilities | $ | 46 | $ | (4 | ) | 4 | $ | 326 | $ | (9 | ) | 50 | $ | 372 | $ | (13 | ) | 54 | ||||||||||||||||||
Energy | 60 | (2 | ) | 11 | 143 | (8 | ) | 17 | 203 | (10 | ) | 28 | ||||||||||||||||||||||||
Finance and insurance | — | — | — | 343 | (10 | ) | 46 | 343 | (10 | ) | 46 | |||||||||||||||||||||||||
Consumer—non-cyclical | 93 | (7 | ) | 12 | 383 | (11 | ) | 49 | 476 | (18 | ) | 61 | ||||||||||||||||||||||||
Technology andcommunications | 173 | (2 | ) | 6 | 198 | (4 | ) | 22 | 371 | (6 | ) | 28 | ||||||||||||||||||||||||
Industrial | — | — | — | 94 | (4 | ) | 14 | 94 | (4 | ) | 14 | |||||||||||||||||||||||||
Capital goods | — | — | — | 128 | (6 | ) | 18 | 128 | (6 | ) | 18 | |||||||||||||||||||||||||
Consumer—cyclical | — | — | — | 175 | (5 | ) | 24 | 175 | (5 | ) | 24 | |||||||||||||||||||||||||
Transportation | — | — | — | 117 | (4 | ) | 16 | 117 | (4 | ) | 16 | |||||||||||||||||||||||||
Subtotal, U.S. corporatesecurities | 372 | (15 | ) | 33 | 1,907 | (61 | ) | 256 | 2,279 | (76 | ) | 289 | ||||||||||||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||||||||||||||||||
Utilities | 21 | (1 | ) | 3 | 103 | (2 | ) | 13 | 124 | (3 | ) | 16 | ||||||||||||||||||||||||
Energy | 13 | (1 | ) | 2 | — | — | — | 13 | (1 | ) | 2 | |||||||||||||||||||||||||
Finance and insurance | — | — | — | 113 | (1 | ) | 23 | 113 | (1 | ) | 23 | |||||||||||||||||||||||||
Consumer—non-cyclical | — | — | — | 72 | (4 | ) | 10 | 72 | (4 | ) | 10 | |||||||||||||||||||||||||
Capital goods | — | — | — | 44 | (1 | ) | 5 | 44 | (1 | ) | 5 | |||||||||||||||||||||||||
Consumer—cyclical | — | — | — | 64 | (1 | ) | 10 | 64 | (1 | ) | 10 | |||||||||||||||||||||||||
Transportation | — | — | — | 51 | (2 | ) | 8 | 51 | (2 | ) | 8 | |||||||||||||||||||||||||
Other | — | — | — | 79 | (2 | ) | 13 | 79 | (2 | ) | 13 | |||||||||||||||||||||||||
Subtotal, non-U.S. corporatesecurities | 34 | (2 | ) | 5 | 526 | (13 | ) | 82 | 560 | (15 | ) | 87 | ||||||||||||||||||||||||
Total for corporate securities in anunrealized loss position | $ | 406 | $ | (17 | ) | 38 | $ | 2,433 | $ | (74 | ) | 338 | $ | 2,839 | $ | (91 | ) | 376 | ||||||||||||||||||
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||||||||||||||
Gross | Gross | Gross | ||||||||||||||||||||||||||||||||||
Fair | unrealized | Number of | Fair | unrealized | Number of | Fair | unrealized | Number of | ||||||||||||||||||||||||||||
(Dollar amounts in millions) | value | losses | securities | value | losses | securities | value | losses | securities | |||||||||||||||||||||||||||
Description of Securities | ||||||||||||||||||||||||||||||||||||
U.S. corporate: | ||||||||||||||||||||||||||||||||||||
Utilities | $ | 35 | $ | (1 | ) | 6 | $ | — | $ | — | — | $ | 35 | $ | (1 | ) | 6 | |||||||||||||||||||
Energy | 594 | (50 | ) | 93 | 88 | (13 | ) | 11 | 682 | (63 | ) | 104 | ||||||||||||||||||||||||
Finance and insurance | 429 | (14 | ) | 56 | — | — | — | 429 | (14 | ) | 56 | |||||||||||||||||||||||||
Consumer—non-cyclical | 80 | (1 | ) | 17 | 43 | (1 | ) | 2 | 123 | (2 | ) | 19 | ||||||||||||||||||||||||
Technology and communications | 89 | (4 | ) | 20 | — | — | — | 89 | (4 | ) | 20 | |||||||||||||||||||||||||
Industrial | 98 | (4 | ) | 9 | — | — | — | 98 | (4 | ) | 9 | |||||||||||||||||||||||||
Capital goods | 90 | (5 | ) | 14 | 14 | (1 | ) | 1 | 104 | (6 | ) | 15 | ||||||||||||||||||||||||
Consumer—cyclical | 181 | (4 | ) | 32 | 37 | (2 | ) | 4 | 218 | (6 | ) | 36 | ||||||||||||||||||||||||
Transportation | 189 | (24 | ) | 44 | — | — | — | 189 | (24 | ) | 44 | |||||||||||||||||||||||||
Subtotal, U.S. corporate securities | 1,785 | (107 | ) | 291 | 182 | (17 | ) | 18 | 1,967 | (124 | ) | 309 | ||||||||||||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||||||||||||||||||
Energy | 150 | (14 | ) | 23 | — | — | — | 150 | (14 | ) | 23 | |||||||||||||||||||||||||
Finance and insurance | 215 | (10 | ) | 43 | — | — | — | 215 | (10 | ) | 43 | |||||||||||||||||||||||||
Consumer—non-cyclical | — | — | — | 6 | (1 | ) | 1 | 6 | (1 | ) | 1 | |||||||||||||||||||||||||
Technology and communications | 34 | (1 | ) | 16 | — | — | — | 34 | (1 | ) | 16 | |||||||||||||||||||||||||
Industrial | 80 | (4 | ) | 11 | — | — | — | 80 | (4 | ) | 11 | |||||||||||||||||||||||||
Capital goods | 62 | (2 | ) | 8 | — | — | — | 62 | (2 | ) | 8 | |||||||||||||||||||||||||
Transportation | 42 | (4 | ) | 15 | — | — | — | 42 | (4 | ) | 15 | |||||||||||||||||||||||||
Other | 30 | (2 | ) | 9 | 6 | (1 | ) | 1 | 36 | (3 | ) | 10 | ||||||||||||||||||||||||
Subtotal, non-U.S. corporate securities | 613 | (37 | ) | 125 | 12 | (2 | ) | 2 | 625 | (39 | ) | 127 | ||||||||||||||||||||||||
Total for corporate securities in an unrealized loss position | $ | 2,398 | $ | (144 | ) | 416 | $ | 194 | $ | (19 | ) | 20 | $ | 2,592 | $ | (163 | ) | 436 | ||||||||||||||||||
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||||||||||||||
Gross | Number | Gross | Number | Gross | Number | |||||||||||||||||||||||||||||||
Fair | unrealized | of | Fair | unrealized | of | Fair | unrealized | of | ||||||||||||||||||||||||||||
(Dollar amounts in millions) | value | losses | securities | value | losses | securities | value | losses | securities | |||||||||||||||||||||||||||
Description of Securities | ||||||||||||||||||||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||||||||||||||||||
U.S. government, agenciesand government-sponsoredenterprises | $ | 545 | $ | (8 | ) | 17 | $ | 161 | $ | (9 | ) | 26 | $ | 706 | $ | (17 | ) | 43 | ||||||||||||||||||
State and political subdivisions | 371 | (10 | ) | 63 | 233 | (12 | ) | 57 | 604 | (22 | ) | 120 | ||||||||||||||||||||||||
Non-U.S. government | 261 | (7 | ) | 51 | 508 | (17 | ) | 35 | 769 | (24 | ) | 86 | ||||||||||||||||||||||||
U.S. corporate | 9,975 | (472 | ) | 1,342 | 2,449 | (210 | ) | 365 | 12,424 | (682 | ) | 1,707 | ||||||||||||||||||||||||
Non-U.S. corporate | 4,172 | (150 | ) | 614 | 1,274 | (74 | ) | 209 | 5,446 | (224 | ) | 823 | ||||||||||||||||||||||||
Residential mortgage-backed | 363 | (6 | ) | 57 | 579 | (11 | ) | 96 | 942 | (17 | ) | 153 | ||||||||||||||||||||||||
Commercial mortgage-backed | 758 | (19 | ) | 115 | 870 | (62 | ) | 130 | 1,628 | (81 | ) | 245 | ||||||||||||||||||||||||
Other asset-backed | 1,597 | (23 | ) | 326 | 604 | (6 | ) | 137 | 2,201 | (29 | ) | 463 | ||||||||||||||||||||||||
Total for fixed maturity securities inan unrealized loss position | $ | 18,042 | $ | (695 | ) | 2,585 | $ | 6,678 | $ | (401 | ) | 1,055 | $ | 24,720 | $ | (1,096 | ) | 3,640 | ||||||||||||||||||
% Below cost: | ||||||||||||||||||||||||||||||||||||
<20% Below cost | $ | 18,008 | $ | (685 | ) | 2,581 | $ | 6,624 | $ | (383 | ) | 1,045 | $ | 24,632 | $ | (1,068 | ) | 3,626 | ||||||||||||||||||
20%-50% Below cost | 34 | (10 | ) | 4 | 54 | (18 | ) | 10 | 88 | (28 | ) | 14 | ||||||||||||||||||||||||
Total for fixed maturity securities inan unrealized loss position | $ | 18,042 | $ | (695 | ) | 2,585 | $ | 6,678 | $ | (401 | ) | 1,055 | $ | 24,720 | $ | (1,096 | ) | 3,640 | ||||||||||||||||||
Investment grade | $ | 16,726 | $ | (615 | ) | 2,393 | $ | 6,508 | $ | (379 | ) | 1,024 | $ | 23,234 | $ | (994 | ) | 3,417 | ||||||||||||||||||
Below investment grade | 1,316 | (80 | ) | 192 | 170 | (22 | ) | 31 | 1,486 | (102 | ) | 223 | ||||||||||||||||||||||||
Total for fixed maturity securities inan unrealized loss position | $ | 18,042 | $ | (695 | ) | 2,585 | $ | 6,678 | $ | (401 | ) | 1,055 | $ | 24,720 | $ | (1,096 | ) | 3,640 | ||||||||||||||||||
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||||||||||||||
(Dollar amounts in millions) | Fair value | Gross unrealized losses | Number securities | Fair value | Gross unrealized losses | Number securities | Fair value | Gross unrealized losses | Number securities | |||||||||||||||||||||||||||
Description of Securities | ||||||||||||||||||||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||||||||||||||||||
State and political subdivisions | $ | 91 | $ | (2 | ) | 14 | $ | — | $ | — | — | $ | 91 | $ | (2 | ) | 14 | |||||||||||||||||||
Non-U.S. government | 224 | (2 | ) | 20 | — | — | — | 224 | (2 | ) | 20 | |||||||||||||||||||||||||
U.S. corporate | 123 | (5 | ) | 27 | 302 | (13 | ) | 33 | 425 | (18 | ) | 60 | ||||||||||||||||||||||||
Non-U.S. corporate | 79 | (1 | ) | 12 | 62 | (4 | ) | 7 | 141 | (5 | ) | 19 | ||||||||||||||||||||||||
Residential mortgage-backed | 22 | (1 | ) | 10 | — | — | — | 22 | (1 | ) | 10 | |||||||||||||||||||||||||
Commercial mortgage-backed | 381 | (5 | ) | 51 | 14 | (3 | ) | 3 | 395 | (8 | ) | 54 | ||||||||||||||||||||||||
Other asset-backed | 532 | (2 | ) | 97 | 439 | (5 | ) | 115 | 971 | (7 | ) | 212 | ||||||||||||||||||||||||
Total for fixed maturity securities in an unrealized loss position | $ | 1,452 | $ | (18 | ) | 231 | $ | 817 | $ | (25 | ) | 158 | $ | 2,269 | $ | (43 | ) | 389 | ||||||||||||||||||
% Below cost: | ||||||||||||||||||||||||||||||||||||
<20% Below cost | $ | 1,452 | $ | (18 | ) | 231 | $ | 807 | $ | (20 | ) | 155 | $ | 2,259 | $ | (38 | ) | 386 | ||||||||||||||||||
20%-50% Below cost | — | — | — | 10 | (5 | ) | 3 | 10 | (5 | ) | 3 | |||||||||||||||||||||||||
Total for fixed maturity securities in an unrealized loss position | $ | 1,452 | $ | (18 | ) | 231 | $ | 817 | $ | (25 | ) | 158 | $ | 2,269 | $ | (43 | ) | 389 | ||||||||||||||||||
Investment grade | $ | 1,408 | $ | (14 | ) | 223 | $ | 702 | $ | (15 | ) | 145 | $ | 2,110 | $ | (29 | ) | 368 | ||||||||||||||||||
Below investment grade | 44 | (4 | ) | 8 | 115 | (10 | ) | 13 | 159 | (14 | ) | 21 | ||||||||||||||||||||||||
Total for fixed maturity securities in an unrealized loss position | $ | 1,452 | $ | (18 | ) | 231 | $ | 817 | $ | (25 | ) | 158 | $ | 2,269 | $ | (43 | ) | 389 | ||||||||||||||||||
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||||||||||||||
Gross | Number | Gross | Number | Gross | Number | |||||||||||||||||||||||||||||||
Fair | unrealized | of | Fair | unrealized | of | Fair | unrealized | of | ||||||||||||||||||||||||||||
(Dollar amounts in millions) | value | losses | securities | value | losses | securities | value | losses | securities | |||||||||||||||||||||||||||
Description of Securities | ||||||||||||||||||||||||||||||||||||
U.S. corporate: | ||||||||||||||||||||||||||||||||||||
Utilities | $ | 1,246 | $ | (61 | ) | 173 | $ | 343 | $ | (34 | ) | 60 | $ | 1,589 | $ | (95 | ) | 233 | ||||||||||||||||||
Energy | 944 | (47 | ) | 135 | 152 | (17 | ) | 23 | 1,096 | (64 | ) | 158 | ||||||||||||||||||||||||
Finance and insurance | 2,393 | (92 | ) | 326 | 688 | (40 | ) | 95 | 3,081 | (132 | ) | 421 | ||||||||||||||||||||||||
Consumer—non-cyclical | 1,826 | (101 | ) | 203 | 389 | (36 | ) | 55 | 2,215 | (137 | ) | 258 | ||||||||||||||||||||||||
Technology andcommunications | 1,135 | (51 | ) | 152 | 263 | (27 | ) | 34 | 1,398 | (78 | ) | 186 | ||||||||||||||||||||||||
Industrial | 506 | (27 | ) | 63 | 74 | (6 | ) | 13 | 580 | (33 | ) | 76 | ||||||||||||||||||||||||
Capital goods | 704 | (31 | ) | 103 | 184 | (20 | ) | 27 | 888 | (51 | ) | 130 | ||||||||||||||||||||||||
Consumer—cyclical | 738 | (35 | ) | 123 | 162 | (13 | ) | 26 | 900 | (48 | ) | 149 | ||||||||||||||||||||||||
Transportation | 435 | (25 | ) | 60 | 179 | (16 | ) | 31 | 614 | (41 | ) | 91 | ||||||||||||||||||||||||
Other | 48 | (2 | ) | 4 | 15 | (1 | ) | 1 | 63 | (3 | ) | 5 | ||||||||||||||||||||||||
Subtotal, U.S. corporatesecurities | 9,975 | (472 | ) | 1,342 | 2,449 | (210 | ) | 365 | 12,424 | (682 | ) | 1,707 | ||||||||||||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||||||||||||||||||
Utilities | 404 | (19 | ) | 58 | 173 | (13 | ) | 24 | 577 | (32 | ) | 82 | ||||||||||||||||||||||||
Energy | 439 | (15 | ) | 64 | 136 | (8 | ) | 20 | 575 | (23 | ) | 84 | ||||||||||||||||||||||||
Finance and insurance | 899 | (25 | ) | 151 | 294 | (15 | ) | 52 | 1,193 | (40 | ) | 203 | ||||||||||||||||||||||||
Consumer—non-cyclical | 377 | (16 | ) | 51 | 102 | (9 | ) | 14 | 479 | (25 | ) | 65 | ||||||||||||||||||||||||
Technology andcommunications | 611 | (24 | ) | 75 | 50 | (2 | ) | 12 | 661 | (26 | ) | 87 | ||||||||||||||||||||||||
Industrial | 275 | (11 | ) | 48 | 72 | (6 | ) | 8 | 347 | (17 | ) | 56 | ||||||||||||||||||||||||
Capital goods | 226 | (7 | ) | 27 | 69 | (3 | ) | 13 | 295 | (10 | ) | 40 | ||||||||||||||||||||||||
Consumer—cyclical | 268 | (11 | ) | 42 | 117 | (2 | ) | 19 | 385 | (13 | ) | 61 | ||||||||||||||||||||||||
Transportation | 232 | (7 | ) | 27 | 67 | (8 | ) | 11 | 299 | (15 | ) | 38 | ||||||||||||||||||||||||
Other | 441 | (15 | ) | 71 | 194 | (8 | ) | 36 | 635 | (23 | ) | 107 | ||||||||||||||||||||||||
Subtotal, non-U.S. corporatesecurities | 4,172 | (150 | ) | 614 | 1,274 | (74 | ) | 209 | 5,446 | (224 | ) | 823 | ||||||||||||||||||||||||
Total for corporate securities in anunrealized loss position | $ | 14,147 | $ | (622 | ) | 1,956 | $ | 3,723 | $ | (284 | ) | 574 | $ | 17,870 | $ | (906 | ) | 2,530 | ||||||||||||||||||
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||||||||||||||
(Dollar amounts in millions) | Fair value | Gross unrealized losses | Number of securities | Fair value | Gross unrealized losses | Number of securities | Fair value | Gross unrealized losses | Number of securities | |||||||||||||||||||||||||||
Description of Securities | ||||||||||||||||||||||||||||||||||||
U.S. corporate: | ||||||||||||||||||||||||||||||||||||
Energy | $ | 54 | $ | (3 | ) | 10 | $ | 80 | $ | (5 | ) | 10 | $ | 134 | $ | (8 | ) | 20 | ||||||||||||||||||
Finance and insurance | — | — | — | 34 | (1 | ) | 4 | 34 | (1 | ) | 4 | |||||||||||||||||||||||||
Consumer—non-cyclical | 34 | (1 | ) | 9 | 93 | (3 | ) | 9 | 127 | (4 | ) | 18 | ||||||||||||||||||||||||
Technology and communications | — | — | — | 18 | (1 | ) | 2 | 18 | (1 | ) | 2 | |||||||||||||||||||||||||
Capital goods | 35 | (1 | ) | 8 | — | — | — | 35 | (1 | ) | 8 | |||||||||||||||||||||||||
Consumer—cyclical | — | — | — | 54 | (2 | ) | 6 | 54 | (2 | ) | 6 | |||||||||||||||||||||||||
Transportation | — | — | — | 23 | (1 | ) | 2 | 23 | (1 | ) | 2 | |||||||||||||||||||||||||
Subtotal, U.S. corporate securities | 123 | (5 | ) | 27 | 302 | (13 | ) | 33 | 425 | (18 | ) | 60 | ||||||||||||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||||||||||||||||||
Consumer—non-cyclical | — | — | — | 31 | (2 | ) | 3 | 31 | (2 | ) | 3 | |||||||||||||||||||||||||
Transportation | — | — | — | 25 | (1 | ) | 3 | 25 | (1 | ) | 3 | |||||||||||||||||||||||||
Other | 79 | (1 | ) | 12 | 6 | (1 | ) | 1 | 85 | (2 | ) | 13 | ||||||||||||||||||||||||
Subtotal, non-U.S. corporate securities | 79 | (1 | ) | 12 | 62 | (4 | ) | 7 | 141 | (5 | ) | 19 | ||||||||||||||||||||||||
Total for corporate securities in an unrealized loss position | $ | 202 | $ | (6 | ) | 39 | $ | 364 | $ | (17 | ) | 40 | $ | 566 | $ | (23 | ) | 79 | ||||||||||||||||||
Amortized | ||||||||
cost or | Fair | |||||||
(Amounts in millions) | cost | value | ||||||
Due one year or less | $ | 1,957 | $ | 1,973 | ||||
Due after one year through five years | 11,198 | 11,602 | ||||||
Due after five years through ten years | 12,300 | 13,197 | ||||||
Due after ten years | 23,647 | 27,548 | ||||||
Subtotal | 49,102 | 54,320 | ||||||
Residential mortgage-backed | 2,511 | 2,738 | ||||||
Commercial mortgage-backed | 2,882 | 2,989 | ||||||
Other asset-backed | 3,699 | 3,727 | ||||||
Total | $ | 58,194 | $ | 63,774 |
(Amounts in millions) | Amortized cost or cost | Fair value | ||||||
Due one year or less | $ | 1,494 | $ | 1,517 | ||||
Due after one year through five years | 9,518 | 10,054 | ||||||
Due after five years through ten years | 12,978 | 14,478 | ||||||
Due after ten years | 23,130 | 29,373 | ||||||
Subtotal | 47,120 | 55,422 | ||||||
Residential mortgage-backed | 1,927 | 2,184 | ||||||
Commercial mortgage-backed | 2,800 | 2,970 | ||||||
Other asset-backed | 2,987 | 2,968 | ||||||
Total | $ | 54,834 | $ | 63,544 | ||||
June 30, 2019 | December 31, 2018 | |||||||||||||||
Carrying | % of | Carrying | % of | |||||||||||||
(Amounts in millions) | value | total | value | total | ||||||||||||
Property type: | ||||||||||||||||
Retail | $ | 2,581 | 37 | % | $ | 2,463 | 37 | % | ||||||||
Industrial | 1,699 | 24 | 1,659 | 25 | ||||||||||||
Office | 1,656 | 24 | 1,548 | 23 | ||||||||||||
Apartments | 525 | 7 | 495 | 7 | ||||||||||||
Mixed use | 247 | 4 | 254 | 4 | ||||||||||||
Other | 270 | 4 | 281 | 4 | ||||||||||||
Subtotal | 6,978 | 100 | % | 6,700 | 100 | % | ||||||||||
Unamortized balance of loan origination fees and costs | (4 | ) | (4 | ) | ||||||||||||
Allowance for credit losses | (11 | ) | (9 | ) | ||||||||||||
Total | $ | 6,963 | $ | 6,687 | ||||||||||||
June 30, 2019 | December 31, 2018 | |||||||||||||||
Carrying | % of | Carrying | % of | |||||||||||||
(Amounts in millions) | value | total | value | total | ||||||||||||
Geographic region: | ||||||||||||||||
South Atlantic | $ | 1,747 | 25 | % | $ | 1,709 | 26 | % | ||||||||
Pacific | 1,701 | 24 | 1,684 | 25 | ||||||||||||
Middle Atlantic | 1,000 | 14 | 950 | 14 | ||||||||||||
Mountain | 717 | 10 | 667 | 10 | ||||||||||||
West North Central | 490 | 7 | 470 | 7 | ||||||||||||
East North Central | 457 | 7 | 405 | 6 | ||||||||||||
West South Central | 387 | 6 | 364 | 6 | ||||||||||||
New England | 261 | 4 | 228 | 3 | ||||||||||||
East South Central | 218 | 3 | 223 | 3 | ||||||||||||
Subtotal | 6,978 | 100 | % | 6,700 | 100 | % | ||||||||||
Unamortized balance of loan origination fees and costs | (4 | ) | (4 | ) | ||||||||||||
Allowance for credit losses | (11 | ) | (9 | ) | ||||||||||||
Total | $ | 6,963 | $ | 6,687 | ||||||||||||
June 30, 2020 | December 31, 2019 | |||||||||||||||
(Amounts in millions) | Carrying value | % of total | Carrying value | % of total | ||||||||||||
Property type: | ||||||||||||||||
Retail | $ | 2,531 | 36 | % | $ | 2,590 | 37 | % | ||||||||
Industrial | 1,655 | 24 | 1,670 | 24 | ||||||||||||
Office | 1,636 | 24 | 1,632 | 23 | ||||||||||||
Apartments | 583 | 8 | 541 | 8 | ||||||||||||
Mixed use | 279 | 4 | 281 | 4 | ||||||||||||
Other | 261 | 4 | 266 | 4 | ||||||||||||
Subtotal | 6,945 | 100 | % | 6,980 | 100 | % | ||||||||||
Unamortized balance of loan origination fees | — | (4 | ) | |||||||||||||
Allowance for credit losses | (28 | ) | (13 | ) | ||||||||||||
Total | $ | 6,917 | $ | 6,963 | ||||||||||||
June 30, 2020 | December 31, 2019 | |||||||||||||||
(Amounts in millions) | Carrying value | % of total | Carrying value | % of total | ||||||||||||
Geographic region: | ||||||||||||||||
South Atlantic | $ | 1,751 | 25 | % | $ | 1,715 | 25 | % | ||||||||
Pacific | 1,623 | 23 | 1,673 | 24 | ||||||||||||
Middle Atlantic | 989 | 14 | 992 | 14 | ||||||||||||
Mountain | 765 | 11 | 753 | 11 | ||||||||||||
West North Central | 476 | 7 | 488 | 7 | ||||||||||||
East North Central | 457 | 7 | 455 | 6 | ||||||||||||
West South Central | 436 | 6 | 433 | 6 | ||||||||||||
New England | 254 | 4 | 257 | 4 | ||||||||||||
East South Central | 194 | 3 | 214 | 3 | ||||||||||||
Subtotal | 6,945 | 100 | % | 6,980 | 100 | % | ||||||||||
Unamortized balance of loan origination fees | — | (4 | ) | |||||||||||||
Allowance for credit losses | (28 | ) | (13 | ) | ||||||||||||
Total | $ | 6,917 | $ | 6,963 | ||||||||||||
June 30, 2019 | ||||||||||||||||||||||||
Greater than | ||||||||||||||||||||||||
31 - 60 days | 61 - 90 days | 90 days past | Total | |||||||||||||||||||||
(Amounts in millions) | past due | past due | due | past due | Current | Total | ||||||||||||||||||
Property type: | ||||||||||||||||||||||||
Retail | $ | — | $ | — | $ | — | $ | — | $ | 2,581 | $ | 2,581 | ||||||||||||
Industrial | — | — | — | — | 1,699 | 1,699 | ||||||||||||||||||
Office | — | — | — | — | 1,656 | 1,656 | ||||||||||||||||||
Apartments | — | — | — | — | 525 | 525 | ||||||||||||||||||
Mixed use | — | — | — | — | 247 | 247 | ||||||||||||||||||
Other | — | — | — | — | 270 | 270 | ||||||||||||||||||
Total recorded investment | $ | — | $ | — | $ | — | $ | — | $ | 6,978 | $ | 6,978 | ||||||||||||
% of total commercial mortgage loans | — | % | — | % | — | % | — | % | 100 | % | 100 | % | ||||||||||||
December 31, 2018 | ||||||||||||||||||||||||
Greater than | ||||||||||||||||||||||||
31 - 60 days | 61 - 90 days | 90 days past | Total | |||||||||||||||||||||
(Amounts in millions) | past due | past due | due | past due | Current | Total | ||||||||||||||||||
Property type: | ||||||||||||||||||||||||
Retail | $ | 3 | $ | — | $ | — | $ | 3 | $ | 2,460 | $ | 2,463 | ||||||||||||
Industrial | — | — | — | — | 1,659 | 1,659 | ||||||||||||||||||
Office | — | — | 3 | 3 | 1,545 | 1,548 | ||||||||||||||||||
Apartments | — | — | — | — | 495 | 495 | ||||||||||||||||||
Mixed use | — | — | — | — | 254 | 254 | ||||||||||||||||||
Other | — | — | — | — | 281 | 281 | ||||||||||||||||||
Total recorded investment | $ | 3 | $ | — | $ | 3 | $ | 6 | $ | 6,694 | $ | 6,700 | ||||||||||||
% of total commercial mortgage loans | — | % | — | % | — | % | — | % | 100 | % | 100 | % | ||||||||||||
June 30, 2020 | ||||||||||||||||||||||||
(Amounts in millions) | 31 - 60 days past due | 61 - 90 days past due | Greater than 90 days past due | Total past due | Current | Total | ||||||||||||||||||
Property type: | ||||||||||||||||||||||||
Retail | $ | 10 | $ | — | $ | — | $ | 10 | $ | 2,521 | $ | 2,531 | ||||||||||||
Industrial | — | — | — | — | 1,655 | 1,655 | ||||||||||||||||||
Office | — | — | — | — | 1,636 | 1,636 | ||||||||||||||||||
Apartments | — | — | — | — | 583 | 583 | ||||||||||||||||||
Mixed use | — | — | — | — | 279 | 279 | ||||||||||||||||||
Other | — | — | — | — | 261 | 261 | ||||||||||||||||||
Total amortized cost | $ | 10 | $ | — | $ | — | $ | 10 | $ | 6,935 | $ | 6,945 | ||||||||||||
% of total commercial mortgage loans | — | % | — | % | — | % | — | % | 100 | % | 100 | % | ||||||||||||
December 31, 2019 | ||||||||||||||||||||||||
(Amounts in millions) | 31 - 60 days past due | 61 - 90 days past due | Greater than 90 days past due | Total past due | Current | Total | ||||||||||||||||||
Property type: | ||||||||||||||||||||||||
Retail | $ | — | $ | — | $ | — | $ | — | $ | 2,590 | $ | 2,590 | ||||||||||||
Industrial | — | — | — | — | 1,670 | 1,670 | ||||||||||||||||||
Office | — | — | — | — | 1,632 | 1,632 | ||||||||||||||||||
Apartments | — | — | — | — | 541 | 541 | ||||||||||||||||||
Mixed use | — | — | — | — | 281 | 281 | ||||||||||||||||||
Other | — | — | — | — | 266 | 266 | ||||||||||||||||||
Total recorded investment | $ | — | $ | — | $ | — | $ | — | $ | 6,980 | $ | 6,980 | ||||||||||||
% of total commercial mortgage loans | — | % | — | % | — | % | — | % | 100 | % | 100 | % | ||||||||||||
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Allowance for credit losses: | ||||||||||||||||
Beginning balance | $ | 10 | $ | 9 | $ | 9 | $ | 9 | ||||||||
Charge-offs | — | — | — | — | ||||||||||||
Recoveries | — | — | — | — | ||||||||||||
Provision | 1 | — | 2 | — | ||||||||||||
Ending balance | $ | 11 | $ | 9 | $ | 11 | $ | 9 | ||||||||
Ending allowance for individually impaired loans | $ | — | $ | — | $ | — | $ | — | ||||||||
Ending allowance for loans not individually impaired that were evaluated collectively for impairment | $ | 11 | $ | 9 | $ | 11 | $ | 9 | ||||||||
Recorded investment: | ||||||||||||||||
Ending balance | $ | 6,978 | $ | 6,492 | $ | 6,978 | $ | 6,492 | ||||||||
Ending balance of individually impaired loans | $ | — | $ | 6 | $ | — | $ | 6 | ||||||||
Ending balance of loans not individually impaired that were evaluated collectively for impairment | $ | 6,978 | $ | 6,486 | $ | 6,978 | $ | 6,486 | ||||||||
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Allowance for credit losses: | ||||||||||||||||
Beginning balance | $ | 29 | $ | 10 | $ | 13 | $ | 9 | ||||||||
Cumulative effect of change in accounting | — | — | 16 | — | ||||||||||||
Provision | (1 | ) | 1 | (1 | ) | 2 | ||||||||||
Write-offs | — | — | — | — | ||||||||||||
Recoveries | — | — | — | — | ||||||||||||
Ending balance | $ | 28 | $ | 11 | $ | 28 | $ | 11 | ||||||||
June 30, 2020 | ||||||||||||||||||||||||
(Amounts in millions) | 0% - 50% | 51% - 60% | 61% - 75% | 76% - 100% | Greater than 100% | Total | ||||||||||||||||||
Property type: | ||||||||||||||||||||||||
Retail | $ | 963 | $ | 572 | $ | 996 | $ | — | $ | — | $ | 2,531 | ||||||||||||
Industrial | 758 | 344 | 553 | — | — | 1,655 | ||||||||||||||||||
Office | 530 | 359 | 739 | 8 | — | 1,636 | ||||||||||||||||||
Apartments | 218 | 98 | 267 | — | — | 583 | ||||||||||||||||||
Mixed use | 104 | 67 | 108 | — | — | 279 | ||||||||||||||||||
Other | 57 | 65 | 139 | — | — | 261 | ||||||||||||||||||
Total amortized cost | $ | 2,630 | $ | 1,505 | $ | 2,802 | $ | 8 | $ | — | $ | 6,945 | ||||||||||||
% of total | 38 | % | 22 | % | 40 | % | — | % | — | % | 100 | % | ||||||||||||
Weighted-average debt service coverage ratio | 2.31 | 1.80 | 1.56 | 1.42 | — | 1.90 | ||||||||||||||||||
December 31, 2019 | ||||||||||||||||||||||||
(Amounts in millions) | 0% - 50% | 51% - 60% | 61% - 75% | 76% - 100% | Greater than 100% | Total | ||||||||||||||||||
Property type: | ||||||||||||||||||||||||
Retail | $ | 986 | $ | 579 | $ | 1,025 | $ | — | $ | — | $ | 2,590 | ||||||||||||
Industrial | 808 | 337 | 525 | — | — | 1,670 | ||||||||||||||||||
Office | 529 | 380 | 723 | — | — | 1,632 | ||||||||||||||||||
Apartments | 211 | 110 | 220 | — | — | 541 | ||||||||||||||||||
Mixed use | 104 | 70 | 107 | — | — | 281 | ||||||||||||||||||
Other | 56 | 69 | 141 | — | — | 266 | ||||||||||||||||||
Total recorded investment | $ | 2,694 | $ | 1,545 | $ | 2,741 | $ | — | $ | — | $ | 6,980 | ||||||||||||
% of total | 39 | % | 22 | % | 39 | % | — | % | — | % | 100 | % | ||||||||||||
Weighted-average debt service coverage ratio | 2.32 | 1.81 | 1.55 | — | — | 1.90 | ||||||||||||||||||
June 30, 2019 | ||||||||||||||||||||||||
(Amounts in millions) | 0% - 50% | 51% - 60% | 61% - 75% | 76% - 100% | Greater than 100% (1) | Total | ||||||||||||||||||
Property type: | ||||||||||||||||||||||||
Retail | $ | 882 | $ | 534 | $ | 1,152 | $ | 13 | $ | — | $ | 2,581 | ||||||||||||
Industrial | 732 | 284 | 674 | 7 | 2 | 1,699 | ||||||||||||||||||
Office | 587 | 378 | 691 | — | — | 1,656 | ||||||||||||||||||
Apartments | 200 | 97 | 223 | 5 | — | 525 | ||||||||||||||||||
Mixed use | 102 | 43 | 102 | — | — | 247 | ||||||||||||||||||
Other | 47 | 63 | 160 | — | — | 270 | ||||||||||||||||||
Total recorded investment | $ | 2,550 | $ | 1,399 | $ | 3,002 | $ | 25 | $ | 2 | $ | 6,978 | ||||||||||||
% of total | 37 | % | 20 | % | 43 | % | — | % | — | % | 100 | % | ||||||||||||
Weighted-average debt service coverage ratio | 2.39 | 1.84 | 1.57 | 1.34 | 0.88 | 1.92 | ||||||||||||||||||
December 31, 2018 | ||||||||||||||||||||||||
(Amounts in millions) | 0% - 50% | 51% - 60% | 61% - 75% | 76% - 100% | Greater than 100% (1) | Total | ||||||||||||||||||
Property type: | ||||||||||||||||||||||||
Retail | $ | 866 | $ | 565 | $ | 1,017 | $ | 15 | $ | — | $ | 2,463 | ||||||||||||
Industrial | 749 | 279 | 615 | 14 | 2 | 1,659 | ||||||||||||||||||
Office | 585 | 373 | 588 | 2 | — | 1,548 | ||||||||||||||||||
Apartments | 206 | 95 | 189 | 5 | — | 495 | ||||||||||||||||||
Mixed use | 105 | 36 | 113 | — | — | 254 | ||||||||||||||||||
Other | 43 | 78 | 160 | — | — | 281 | ||||||||||||||||||
Total recorded investment | $ | 2,554 | $ | 1,426 | $ | 2,682 | $ | 36 | $ | 2 | $ | 6,700 | ||||||||||||
% of total | 38 | % | 21 | % | 40 | % | 1 | % | — | % | 100 | % | ||||||||||||
Weighted-average debt service coverage ratio | 2.42 | 2.04 | 1.59 | 1.38 | 0.88 | 2.00 | ||||||||||||||||||
June 30, 2019 | ||||||||||||||||||||||||
(Amounts in millions) | Less than 1.00 | 1.00 - 1.25 | 1.26 - 1.50 | 1.51 - 2.00 | Greater than 2.00 | Total | ||||||||||||||||||
Property type: | ||||||||||||||||||||||||
Retail | $ | 33 | $ | 147 | $ | 604 | $ | 1,238 | $ | 559 | $ | 2,581 | ||||||||||||
Industrial | 22 | 68 | 254 | 711 | 644 | 1,699 | ||||||||||||||||||
Office | 51 | 47 | 213 | 833 | 512 | 1,656 | ||||||||||||||||||
Apartments | 4 | 24 | 107 | 196 | 194 | 525 | ||||||||||||||||||
Mixed use | 3 | 18 | 52 | 79 | 95 | 247 | ||||||||||||||||||
Other | 12 | 132 | 52 | 40 | 34 | 270 | ||||||||||||||||||
Total recorded investment | $ | 125 | $ | 436 | $ | 1,282 | $ | 3,097 | $ | 2,038 | $ | 6,978 | ||||||||||||
% of total | 2 | % | 6 | % | 18 | % | 45 | % | 29 | % | 100 | % | ||||||||||||
Weighted-average loan-to-value | 55 | % | 61 | % | 64 | % | 59 | % | 42 | % | 55 | % | ||||||||||||
December 31, 2018 | ||||||||||||||||||||||||
(Amounts in millions) | Less than 1.00 | 1.00 - 1.25 | 1.26 - 1.50 | 1.51 - 2.00 | Greater than 2.00 | Total | ||||||||||||||||||
Property type: | ||||||||||||||||||||||||
Retail | $ | 43 | $ | 157 | $ | 448 | $ | 1,234 | $ | 581 | $ | 2,463 | ||||||||||||
Industrial | 22 | 75 | 233 | 653 | 676 | 1,659 | ||||||||||||||||||
Office | 57 | 56 | 156 | 765 | 514 | 1,548 | ||||||||||||||||||
Apartments | 4 | 24 | 104 | 168 | 195 | 495 | ||||||||||||||||||
Mixed use | 3 | 19 | 51 | 80 | 101 | 254 | ||||||||||||||||||
Other | 13 | 134 | 50 | 50 | 34 | 281 | ||||||||||||||||||
Total recorded investment | $ | 142 | $ | 465 | $ | 1,042 | $ | 2,950 | $ | 2,101 | $ | 6,700 | ||||||||||||
% of total | 2 | % | 7 | % | 16 | % | 44 | % | 31 | % | 100 | % | ||||||||||||
Weighted-average loan-to-value | 57 | % | 61 | % | 62 | % | 59 | % | 42 | % | 54 | % | ||||||||||||
June 30, 2020 | ||||||||||||||||||||||||
(Amounts in millions) | Less than 1.00 | 1.00 - 1.25 | 1.26 - 1.50 | 1.51 - 2.00 | Greater than 2.00 | Total | ||||||||||||||||||
Property type: | ||||||||||||||||||||||||
Retail | $ | 63 | $ | 136 | $ | 599 | $ | 1,118 | $ | 615 | $ | 2,531 | ||||||||||||
Industrial | 24 | 64 | 215 | 670 | 682 | 1,655 | ||||||||||||||||||
Office | 28 | 112 | 269 | 751 | 476 | 1,636 | ||||||||||||||||||
Apartments | 11 | 25 | 178 | 184 | 185 | 583 | ||||||||||||||||||
Mixed use | 3 | 18 | 37 | 106 | 115 | 279 | ||||||||||||||||||
Other | 33 | 145 | 19 | 31 | 33 | 261 | ||||||||||||||||||
Total amortized cost | $ | 162 | $ | 500 | $ | 1,317 | $ | 2,860 | $ | 2,106 | $ | 6,945 | ||||||||||||
% of total | 3 | % | 7 | % | 19 | % | 41 | % | 30 | % | 100 | % | ||||||||||||
Weighted-average debt-to-value | 57 | % | 61 | % | 63 | % | 58 | % | 41 | % | 54 | % | ||||||||||||
December 31, 2019 | ||||||||||||||||||||||||
(Amounts in millions) | Less than 1.00 | 1.00 - 1.25 | 1.26 - 1.50 | 1.51 - 2.00 | Greater than 2.00 | Total | ||||||||||||||||||
Property type: | ||||||||||||||||||||||||
Retail | $ | 68 | $ | 141 | $ | 596 | $ | 1,148 | $ | 637 | $ | 2,590 | ||||||||||||
Industrial | 24 | 51 | 221 | 658 | 716 | 1,670 | ||||||||||||||||||
Office | 44 | 89 | 277 | 751 | 471 | 1,632 | ||||||||||||||||||
Apartments | 16 | 32 | 129 | 175 | 189 | 541 | ||||||||||||||||||
Mixed use | 4 | 16 | 37 | 107 | 117 | 281 | ||||||||||||||||||
Other | 34 | 147 | 20 | 31 | 34 | 266 | ||||||||||||||||||
Total recorded investment | $ | 190 | $ | 476 | $ | 1,280 | $ | 2,870 | $ | 2,164 | $ | 6,980 | ||||||||||||
% of total | 3 | % | 7 | % | 18 | % | 41 | % | 31 | % | 100 | % | ||||||||||||
Weighted-average debt-to-value | 59 | % | 61 | % | 63 | % | 58 | % | 41 | % | 54 | % | ||||||||||||
(Amounts in millions) | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 and prior | Total | |||||||||||||||||||||
Debt-to-value: | ||||||||||||||||||||||||||||
0% - 50% | $ | 4 | $ | 15 | $ | 36 | $ | 105 | $ | 118 | $ | 2,352 | $ | 2,630 | ||||||||||||||
51% - 60% | 29 | 33 | 190 | 289 | 155 | 809 | 1,505 | |||||||||||||||||||||
61% - 75% | 236 | 748 | 766 | 337 | 226 | 489 | 2,802 | |||||||||||||||||||||
76% - 100% | — | — | 8 | — | — | — | 8 | |||||||||||||||||||||
Greater than 100% | — | — | — | — | — | — | — | |||||||||||||||||||||
Total amortized cost | $ | 269 | $ | 796 | $ | 1,000 | $ | 731 | $ | 499 | $ | 3,650 | $ | 6,945 | ||||||||||||||
Debt service coverage ratio: | ||||||||||||||||||||||||||||
Less than 1.00 | $ | — | $ | — | $ | 33 | $ | 3 | $ | — | $ | 126 | $ | 162 | ||||||||||||||
1.00 - 1.25 | 39 | 12 | 107 | 73 | 13 | 256 | 500 | |||||||||||||||||||||
1.26 - 1.50 | 62 | 359 | 261 | 97 | 88 | 450 | 1,317 | |||||||||||||||||||||
1.51 - 2.00 | 130 | 357 | 505 | 322 | 268 | 1,278 | 2,860 | |||||||||||||||||||||
Greater than 2.00 | 38 | 68 | 94 | 236 | 130 | 1,540 | 2,106 | |||||||||||||||||||||
Total amortized cost | $ | 269 | $ | 796 | $ | 1,000 | $ | 731 | $ | 499 | $ | 3,650 | $ | 6,945 | ||||||||||||||
Write-offs, gross | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||
Recoveries | — | — | — | — | — | — | — | |||||||||||||||||||||
Write-offs, net | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||
Derivative assets | Derivative liabilities | |||||||||||||||||||
Fair value | Fair value | |||||||||||||||||||
(Amounts in millions) | Balance sheet classification | June 30, 2019 | December 31, 2018 | Balance sheet classification | June 30, 2019 | December 31, 2018 | ||||||||||||||
Derivatives designated ashedges | ||||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||||
Interest rate swaps | Other invested assets | $ | 144 | $ | 42 | Other liabilities | $ | 10 | $ | 102 | ||||||||||
Foreign currency swaps | Other invested assets | 5 | 6 | Other liabilities | 1 | — | ||||||||||||||
Total cash flow hedges | 149 | 48 | 11 | 102 | ||||||||||||||||
Total derivativesdesignated as hedges | 149 | 48 | 11 | 102 | ||||||||||||||||
Derivatives not designated ashedges | ||||||||||||||||||||
Interest rate swaps in aforeign currency | Other invested assets | 35 | 74 | Other liabilities | — | — | ||||||||||||||
Interest rate caps and floors | Other invested assets | 16 | 7 | Other liabilities | — | — | ||||||||||||||
Foreign currency swaps | Other invested assets | 1 | — | Other liabilities | 7 | 23 | ||||||||||||||
Equity index options | Other invested assets | 65 | 39 | Other liabilities | — | — | ||||||||||||||
Financial futures | Other invested assets | — | — | Other liabilities | — | — | ||||||||||||||
Equity return swaps | Other invested assets | — | — | Other liabilities | — | 1 | ||||||||||||||
Other foreign currencycontracts | Other invested assets | 14 | 10 | Other liabilities | 25 | 42 | ||||||||||||||
GMWB embeddedderivatives | Reinsurance recoverable (1) | 20 | 20 | Policyholderaccount balances (2) | 325 | 337 | ||||||||||||||
Fixed index annuity embeddedderivatives | Other assets | — | — | Policyholderaccount balances (3) | 438 | 389 | ||||||||||||||
Indexed universal lifeembedded derivatives | Reinsurancerecoverable | — | — | Policyholderaccount balances (4) | 15 | 12 | ||||||||||||||
Total derivatives notdesignated as hedges | 151 | 150 | 810 | 804 | ||||||||||||||||
Total derivatives | $ | 300 | $ | 198 | $ | 821 | $ | 906 | ||||||||||||
Derivative assets | Derivative liabilities | |||||||||||||||||||||||
Fair value | Fair value | |||||||||||||||||||||||
(Amounts in millions) | Balance sheet | June 30, 2020 | December 31, 2019 | Balance sheet | June 30, 2020 | December 31, 2019 | ||||||||||||||||||
Derivatives designated as hedges | ||||||||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||||||||
Interest rate swaps | Other invested assets | $ | 939 | $ | 197 | Other liabilities | $ | — | $ | 10 | ||||||||||||||
Foreign currency swaps | Other invested assets | 17 | 4 | Other liabilities | — | — | ||||||||||||||||||
Total cash flow hedges | 956 | 201 | — | 10 | ||||||||||||||||||||
Total derivatives designated as hedges | 956 | 201 | — | 10 | ||||||||||||||||||||
Derivatives not designated as hedges | ||||||||||||||||||||||||
Equity index options | Other invested assets | 66 | 81 | Other liabilities | — | — | ||||||||||||||||||
Financial futures | Other invested assets | — | — | Other liabilities | — | — | ||||||||||||||||||
Other foreign currency contracts | Other invested assets | 2 | 8 | Other liabilities | 1 | 1 | ||||||||||||||||||
GMWB embedded derivatives | Reinsurance (1) | | 38 | 20 | Policyholder account balances (2) | | 559 | 323 | ||||||||||||||||
Fixed index annuity embedded derivatives | Other assets | — | — | Policyholder account balances (3) | | 447 | 452 | |||||||||||||||||
Indexed universal life embedded derivatives | Reinsurance | | — | — | Policyholder account balances (4) | | 23 | 19 | ||||||||||||||||
Total derivatives not designated as hedges | 106 | 109 | 1,030 | 795 | ||||||||||||||||||||
Total derivatives | $ | 1,062 | $ | 310 | $ | 1,030 | $ | 805 | ||||||||||||||||
(1) | Represents embedded derivatives associated with the reinsured portion of our guaranteed minimum withdrawal benefits (“GMWB”) liabilities. |
(2) | Represents the embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
(3) | Represents the embedded derivatives associated with our fixed index annuity liabilities. |
(4) | Represents the embedded derivatives associated with our indexed universal life liabilities. |
(Notional in millions) | Measurement | December 31, 201 8 | Additions | Maturities/ terminations | June 30, 2019 | |||||||||||||||
Derivatives designated as hedges | ||||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||||
Interest rate swaps | Notional | $ | 9,924 | $ | 469 | $ | ( 1,338 | ) | $ | 9,055 | ||||||||||
Foreign currency swaps | Notional | 80 | 52 | (22 | ) | 110 | ||||||||||||||
Total cash flow hedges | 10,004 | 521 | (1,360 | ) | 9,165 | |||||||||||||||
Total derivatives designated as hedges | 10,004 | 521 | (1,360 | ) | 9,165 | |||||||||||||||
Derivatives not designated as hedges | ||||||||||||||||||||
Interest rate swaps | Notional | 4,674 | — | — | 4,674 | |||||||||||||||
Interest rate swaps in a foreign currency | Notional | 2,565 | 187 | (77 | ) | 2,675 | ||||||||||||||
Interest rate caps and floors | Notional | 2,624 | 160 | (66 | ) | 2,718 | ||||||||||||||
Foreign currency swaps | Notional | 453 | — | (2 | ) | 451 | ||||||||||||||
Equity index options | Notional | 2,628 | 939 | (1,035 | ) | 2,532 | ||||||||||||||
Financial futures | Notional | 1,415 | 3,029 | (3,217 | ) | 1,227 | ||||||||||||||
Equity return swaps | Notional | 17 | 2 | (2 | ) | 17 | ||||||||||||||
Other foreign currency contracts | Notional | 1,080 | 2,925 | (2,704 | ) | 1,301 | ||||||||||||||
Total derivatives not designated as hedges | 15,456 | 7,242 | (7,103 | ) | 15,595 | |||||||||||||||
Total derivatives | $ | 25,460 | $ | 7,763 | $ | ( 8,463 | ) | $ | 24,760 | |||||||||||
(Number of policies) | Measurement | December 31, 2018 | Additions | Maturities/ terminations | June 30, 2019 | |||||||||||||||
Derivatives not designated as hedges | ||||||||||||||||||||
GMWB embedded derivatives | Policies | 27,886 | — | (1,139 | ) | 26,747 | ||||||||||||||
Fixed index annuity embedded derivatives | Policies | 16,464 | — | (410 | ) | 16,054 | ||||||||||||||
Indexed universal life embedded derivatives | Policies | 929 | — | (21 | ) | 908 |
(Notional in millions) | Measurement | December 31, 2019 | Additions | Maturities/ terminations | June 30, 2020 | |||||||||||||
Derivatives designated as hedges | ||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||
Interest rate swaps | Notional | $ | 8,968 | $ | 1,158 | $ | (1,880 | ) | $ | 8,246 | ||||||||
Foreign currency swaps | Notional | 110 | — | — | 110 | |||||||||||||
Total cash flow hedges | 9,078 | 1,158 | (1,880 | ) | 8,356 | |||||||||||||
Total derivatives designated as hedges | 9,078 | 1,158 | (1,880 | ) | 8,356 | |||||||||||||
Derivatives not designated as hedges | ||||||||||||||||||
Interest rate swaps | Notional | 4,674 | — | — | 4,674 | |||||||||||||
Equity index options | Notional | 2,451 | 883 | (1,126 | ) | 2,208 | ||||||||||||
Financial futures | Notional | 1,182 | 3,082 | (2,914 | ) | 1,350 | ||||||||||||
Other foreign currency contracts | Notional | 628 | 3,009 | (2,618 | ) | 1,019 | ||||||||||||
Total derivatives not designated as hedges | 8,935 | 6,974 | (6,658 | ) | 9,251 | |||||||||||||
Total derivatives | $ | 18,013 | $ | 8,132 | $ | (8,538 | ) | $ | 17,607 | |||||||||
(Number of policies) | Measurement | December 31, 2019 | Additions | Maturities/ terminations | June 30, 2020 | |||||||||||||
Derivatives not designated as hedges | ||||||||||||||||||
GMWB embedded derivatives | Policies | 25,623 | — | (992 | ) | 24,631 | ||||||||||||
Fixed index annuity embedded derivatives | Policies | 15,441 | — | (668 | ) | 14,773 | ||||||||||||
Indexed universal life embedded derivatives | Policies | 884 | — | (28 | ) | 856 |
Gain (loss) reclassified into | Classification of gain (loss) | Gain (loss) | Classification of gain (loss) | |||||||||||||||||
Gain (loss) | net income | reclassified into | recognized in | recognized in net | ||||||||||||||||
(Amounts in millions) | recognized in OCI | from OCI | net income | net income | income | |||||||||||||||
Interest rate swaps hedging assets | $ | 216 | $ | 42 | Net investment income | $ | — | Net investment gains (losses) | ||||||||||||
Interest rate swaps hedging assets | — | (4 | ) | Net investment gains (losses) | — | Net investment gains (losses) | ||||||||||||||
Interest rate swaps hedging liabilities | (20 | ) | — | Interest expense | — | Net investment gains (losses) | ||||||||||||||
Foreign currency swaps | 2 | (1 | ) | Net investment income | — | Net investment gains (losses) | ||||||||||||||
Total | $ | 198 | $ | 37 | $ | — | ||||||||||||||
Gain (loss) reclassified into | Classification of gain (loss) | Gain (loss) | Classification of gain (loss) | |||||||||||||||||
Gain (loss) | net income | reclassified into | recognized in | recognized in net | ||||||||||||||||
(Amounts in millions) | recognized in OCI | from OCI | net income | net income | income | |||||||||||||||
Interest rate swaps hedging assets | $ | (54 | ) | $ | 39 | Net investment income | $ | — | Net investment gains (losses) | |||||||||||
Interest rate swaps hedging liabilities | 5 | — | Interest expense | — | Net investment gains (losses) | |||||||||||||||
Foreign currency swaps | 1 | — | Net investment income | — | Net investment gains (losses) | |||||||||||||||
Total | $ | (48 | ) | $ | 39 | $ | — | |||||||||||||
(Amounts in millions) | Gain (loss) recognized in OCI | Gain (loss) reclassified into net income (loss) from OCI | Classification of gain (loss) reclassified into net income (loss) | Gain (loss) recognized in net income (loss) | Classification of gain (loss) recognized in net income (loss) | |||||||||||
Interest rate swaps hedging assets | $ | (57 | ) | $ | 46 | Net investment income | $ | — | Net investment gains (losses) | |||||||
Interest rate swaps hedging liabilities | 1 | — | Interest expense | — | Net investment gains (losses) | |||||||||||
Foreign currency swaps | (4 | ) | — | Net investment income | — | Net investment gains (losses) | ||||||||||
Total | $ | (60 | ) | $ | 46 | $ | — | |||||||||
(Amounts in millions) | Gain (loss) recognized in OCI | Gain (loss) reclassified into net income (loss) from OCI | Classification of gain (loss) reclassified into net income (loss) | Gain (loss) recognized in net income (loss) | Classification of gain (loss) recognized in net income (loss) | ||||||||||
Interest rate swaps hedging assets | $ | 216 | $ | 42 | Net investment income | $ | — | Net investment gains (losses) | |||||||
Interest rate swaps hedging assets | — | (4 | ) | Net investment gains (losses) | — | Net investment gains (losses) | |||||||||
Interest rate swaps hedging liabilities | (20 | ) | — | Interest expense | — | Net investment gains (losses) | |||||||||
Foreign currency swaps | 2 | (1 | ) | Net investment income | — | Net investment gains (losses) | |||||||||
Total | $ | 198 | $ | 37 | $ | — | |||||||||
(Amounts in millions) | Gain (loss) recognized in OCI | Gain (loss) reclassified into net income (loss) from OCI | Classification of gain (loss) reclassified into net income (loss) | Gain (loss) recognized in net income (loss) | Classification of gain (loss) recognized in net income (loss) | ||||||||||
Interest rate swaps hedging assets | $ | 984 | $ | 89 | Net investment income | $ | — | Net investment gains (losses) | |||||||
Interest rate swaps hedging assets | — | 4 | Net investment gains (losses) | — | Net investment gains (losses) | ||||||||||
Interest rate swaps hedging liabilities | (62 | ) | — | Interest expense | — | Net investment gains (losses) | |||||||||
Foreign currency swaps | 13 | — | Net investment income | — | Net investment gains (losses) | ||||||||||
Total | $ | 935 | $ | 93 | $ | — | |||||||||
Gain (loss) reclassified into | Classification of gain (loss) | Gain (loss) | Classification of gain (loss) | |||||||||||||||||
Gain (loss) | net income | reclassified into | recognized in | recognized in | ||||||||||||||||
(Amounts in millions) | recognized in OCI | from OCI | net income | net income | net income | |||||||||||||||
Interest rate swaps hedging assets | $ | 353 | $ | 80 | Net investment income | $ | — | Net investment gains (losses) | ||||||||||||
Interest rate swaps hedging assets | — | 2 | Net investment gains (losses) | — | Net investment gains (losses) | |||||||||||||||
Interest rate swaps hedging liabilities | (32 | ) | — | Interest expense | — | Net investment gains (losses) | ||||||||||||||
Foreign currency swaps | (1 | ) | (1 | ) | Net investment income | — | Net investment gains (losses) | |||||||||||||
Foreign currency swaps | — | — | Net investment gains (losses) | 2 | Net investment gains (losses) | |||||||||||||||
Total | $ | 320 | $ | 81 | $ | 2 | ||||||||||||||
(Amounts in millions) | Gain (loss) recognized in OCI | Gain (loss) reclassified into net income (loss) from OCI | Classification of gain (loss) reclassified into net income (loss) | Gain (loss) recognized in net income (loss) | Classification of gain (loss) recognized in net income (loss) | |||||||||||
Interest rate swaps hedging assets | $ | 353 | $ | 80 | Net investment income | $ | — | Net investment gains (losses) | ||||||||
Interest rate swaps hedging assets | — | 2 | Net investment gains (losses) | — | Net investment gains (losses) | |||||||||||
Interest rate swaps hedging liabilities | (32 | ) | — | Interest expense | — | Net investment gains (losses) | ||||||||||
Foreign currency swaps | (1 | ) | (1 | ) | Net investment income | — | Net investment gains (losses) | |||||||||
Foreign currency swaps | — | — | Net investment gains (losses) | 2 | Net investment gains (losses) | |||||||||||
Total | $ | 320 | $ | 81 | $ | 2 | ||||||||||
Gain (loss) reclassified into | Classification of gain (loss) | Gain (loss) | Classification of gain (loss) | |||||||||||||||||
Gain (loss) | net income | reclassified into | recognized in | recognized in | ||||||||||||||||
(Amounts in millions) | recognized in OCI | from OCI | net income | net income | net income | |||||||||||||||
Interest rate swaps hedging assets | $ | (227 | ) | $ | 74 | Net investment income | $ | — | Net investment gains (losses) | |||||||||||
Interest rate swaps hedging assets | — | 5 | Net investment gains (losses) | — | Net investment gains (losses) | |||||||||||||||
Interest rate swaps hedging liabilities | 22 | — | Interest expense | — | Net investment gains (losses) | |||||||||||||||
Total | $ | (205 | ) | $ | 79 | $ | — | |||||||||||||
Three months ended June 30, | ||||||||
(Amounts in millions) | 2019 | 2018 | ||||||
Derivatives qualifying as effective accounting hedges as of April 1 | $ | 1,850 | $ | 1,927 | ||||
Current period increases (decreases) in fair value, net of deferred taxes of $(41) and $9 | 157 | (39 | ) | |||||
Reclassification to net (income), net of deferred taxes of $13 and $14 | (24 | ) | (25 | ) | ||||
Derivatives qualifying as effective accounting hedges as of June 30 | $ | 1,983 | $ | 1,863 | ||||
Three months ended June 30, | ||||||||
(Amounts in millions) | 2020 | 2019 | ||||||
Derivatives qualifying as effective accounting hedges as of April 1 | $ | 2,755 | $ | 1,850 | ||||
Current period increases (decreases) in fair value, net of deferred taxes of $12 and $(41) | (48 | ) | 157 | |||||
Reclassification to net (income), net of deferred taxes of $16 and $13 | (30 | ) | (24 | ) | ||||
Derivatives qualifying as effective accounting hedges as of June 30 | $ | 2,677 | $ | 1,983 | ||||
Six months ended June 30, | ||||||||
(Amounts in millions) | 2019 | 2018 | ||||||
Derivatives qualifying as effective accounting hedges as of January 1 | $ | 1,781 | $ | 2,065 | ||||
Cumulative effect of changes in accounting: | ||||||||
Stranded tax effects | — | 12 | ||||||
Changes to the hedge accounting model, net of deferred taxes of $— and $(1) | — | 2 | ||||||
Total cumulative effect of changes in accounting | — | 14 | ||||||
Current period increases (decreases) in fair value, net of deferred taxes of $(66) and $43 | 254 | (165 | ) | |||||
Reclassification to net (income), net of deferred taxes of $29 and $28 | (52 | ) | (51 | ) | ||||
Derivatives qualifying as effective accounting hedges as of June 30 | $ | 1,983 | $ | 1,863 | ||||
Six months ended June 30, | ||||||||
(Amounts in millions) | 2020 | 2019 | ||||||
Derivatives qualifying as effective accounting hedges as of January 1 | $ | 2,002 | $ | 1,781 | ||||
Current period increases (decreases) in fair value, net of deferred taxes of $(200) and $(66) | 735 | 254 | ||||||
Reclassification to net (income), net of deferred taxes of $33 and $29 | (60 | ) | (52 | ) | ||||
Derivatives qualifying as effective accounting hedges as of June 30 | $ | 2,677 | $ | 1,983 | ||||
Three months ended June 30, | Classification of gain (loss) recognized | ||||||||||
(Amounts in millions) | 2019 | 2018 | in net income | ||||||||
Interest rate swaps | $ | (3 | ) | $ | (2 | ) | Net investment gains (losses) | ||||
Interest rate swaps in a foreign currency | (6 | ) | — | Net investment gains (losses) | |||||||
Interest rate caps and floors | 3 | — | Net investment gains (losses) | ||||||||
Foreign currency swaps | 6 | (10 | ) | Net investment gains (losses) | |||||||
Equity index options | 10 | 8 | Net investment gains (losses) | ||||||||
Financial futures | 17 | (13 | ) | Net investment gains (losses) | |||||||
Equity return swaps | 1 | 1 | Net investment gains (losses) | ||||||||
Other foreign currency contracts | (3 | ) | 1 | Net investment gains (losses) | |||||||
GMWB embedded derivatives | (22 | ) | 13 | Net investment gains (losses) | |||||||
Fixed index annuity embedded derivatives | (20 | ) | (15 | ) | Net investment gains (losses) | ||||||
Indexed universal life embedded derivatives | (1 | ) | 2 | Net investment gains (losses) | |||||||
Total derivatives not designated as hedges | $ | (18 | ) | $ | (15 | ) | |||||
Three months ended June 30, | Classification of gain (loss) recognized in net income (loss) | |||||||||
(Amounts in millions) | 2020 | 2019 | ||||||||
Interest rate swaps | $ | (2 | ) | $ | (3 | ) | Net investment gains (losses) | |||
Equity index options | 4 | 10 | Net investment gains (losses) | |||||||
Financial futures | (123 | ) | 17 | Net investment gains (losses) | ||||||
Other foreign currency contracts | 44 | (7 | ) | Net investment gains (losses) | ||||||
GMWB embedded derivatives | 129 | (22 | ) | Net investment gains (losses) | ||||||
Fixed index annuity embedded derivatives | (45 | ) | (20 | ) | Net investment gains (losses) | |||||
Indexed universal life embedded derivatives | 3 | (1 | ) | Net investment gains (losses) | ||||||
Total derivatives not designated as hedges | $ | 10 | $ | (26 | ) | |||||
Six months ended June 30, | Classification of gain (loss) recognized in net income (loss) | |||||||||
(Amounts in millions) | 2020 | 2019 | ||||||||
Interest rate swaps | $ | (12 | ) | $ | (4 | ) | Net investment gains (losses) | |||
Equity index options | (9 | ) | 27 | Net investment gains (losses) | ||||||
Financial futures | 138 | (27 | ) | Net investment gains (losses) | ||||||
Other foreign currency contracts | (3 | ) | (7 | ) | Net investment gains (losses) | |||||
GMWB embedded derivatives | (207 | ) | 23 | Net investment gains (losses) | ||||||
Fixed index annuity embedded derivatives | (13 | ) | (58 | ) | Net investment gains (losses) | |||||
Indexed universal life embedded derivatives | 7 | — | Net investment gains (losses) | |||||||
Total derivatives not designated as hedges | $ | (99 | ) | $ | (46 | ) | ||||
Six months ended June 30, | Classification of gain (loss) recognized | ||||||||||
(Amounts in millions) | 2019 | 2018 | in net income | ||||||||
Interest rate swaps | $ | (4 | ) | $ | (3 | ) | Net investment gains (losses) | ||||
Interest rate swaps in a foreign currency | (29 | ) | — | Net investment gains (losses) | |||||||
Interest rate caps and floors | 9 | — | Net investment gains (losses) | ||||||||
Foreign currency swaps | 16 | (18 | ) | Net investment gains (losses) | |||||||
Equity index options | 27 | (7 | ) | Net investment gains (losses) | |||||||
Financial futures | (27 | ) | (37 | ) | Net investment gains (losses) | ||||||
Equity return swaps | 1 | (4 | ) | Net investment gains (losses) | |||||||
Other foreign currency contracts | 6 | 9 | Net investment gains (losses) | ||||||||
GMWB embedded derivatives | 23 | 27 | Net investment gains (losses) | ||||||||
Fixed index annuity embedded derivatives | (58 | ) | (7 | ) | Net investment gains (losses) | ||||||
Indexed universal life embedded derivatives | — | 7 | Net investment gains (losses) | ||||||||
Total derivatives not designated as hedges | $ | (36 | ) | $ | (33 | ) | |||||
June 30, 2019 | December 31, 2018 | |||||||||||||||||||||||
(Amounts in millions) | Derivatives assets (1) | Derivatives liabilities (2) | Net derivatives | Derivatives assets (1) | Derivatives liabilities (2) | Net derivatives | ||||||||||||||||||
Amounts presented in the balance sheet: | ||||||||||||||||||||||||
Gross amounts recognized | $ | 287 | $ | 44 | $ | 243 | $ | 185 | $ | 169 | $ | 16 | ||||||||||||
Gross amounts offset in the balance sheet | — | — | — | — | — | — | ||||||||||||||||||
Net amounts presented in the balance sheet | 287 | 44 | 243 | 185 | 169 | 16 | ||||||||||||||||||
Gross amounts not offset in the balance sheet: | ||||||||||||||||||||||||
Financial instruments (3) | (35 | ) | (35 | ) | — | (66 | ) | (66 | ) | — | ||||||||||||||
Collateral received | (77 | ) | — | (77 | ) | (84 | ) | — | (84 | ) | ||||||||||||||
Collateral pledged | — | (327 | ) | 327 | — | (536 | ) | 536 | ||||||||||||||||
Over collateralization | — | 318 | (318 | ) | 10 | 433 | (423 | ) | ||||||||||||||||
Net amount | $ | 175 | $ | — | $ | 175 | $ | 45 | $ | — | $ | 45 | ||||||||||||
June 30, 2020 | December 31, 2019 | |||||||||||||||||||||||
(Amounts in millions) | Derivative assets (1) | Derivative liabilities (2) | Net derivatives | Derivative assets (1) | Derivative liabilities (2) | Net derivatives | ||||||||||||||||||
Amounts presented in the balance sheet: | ||||||||||||||||||||||||
Gross amounts recognized | $ | 1,024 | $ | 1 | $ | 1,023 | $ | 291 | $ | 11 | $ | 280 | ||||||||||||
Gross amounts offset in the balance sheet | — | — | — | — | — | — | ||||||||||||||||||
Net amounts presented in the balance sheet | 1,024 | 1 | 1,023 | 291 | 11 | 280 | ||||||||||||||||||
Gross amounts not offset in the balance sheet: | ||||||||||||||||||||||||
Financial instruments (3) | (1 | ) | (1 | ) | — | (7 | ) | (7 | ) | — | ||||||||||||||
Collateral received | (864 | ) | — | (864 | ) | (179 | ) | — | (179 | ) | ||||||||||||||
Collateral pledged | — | (434 | ) | 434 | — | (405 | ) | 405 | ||||||||||||||||
Over collateralization | 19 | 433 | (414 | ) | 18 | 401 | (383 | ) | ||||||||||||||||
Net amount | $ | 178 | $ | (1 | ) | $ | 179 | $ | 123 | $ | — | $ | 123 | |||||||||||
(1) | Included |
(2) |
(3) | Amounts represent derivative assets and/or liabilities that are presented gross within the balance sheet but are held with the same counterparty where we have a master netting arrangement. This adjustment results in presenting the net asset and net liability position for each counterparty. |
June 30, 2019 | ||||||||||||||||||||||||
Notional | Carrying | Fair value | ||||||||||||||||||||||
(Amounts in millions) | amount | amount | Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Commercial mortgage loans | (1 | ) | $ | 6,963 | $ | 7,241 | $ | — | $ | — | $ | 7,241 | ||||||||||||
Restricted commercial mortgage loans | ( 1 | ) | 56 | 61 | — | — | 61 | |||||||||||||||||
Other invested assets: | ||||||||||||||||||||||||
Bank loan investments | ( 1 | ) | 337 | 336 | — | — | 336 | |||||||||||||||||
Liabilities: | ||||||||||||||||||||||||
Long-term borrowings | ( 1 | ) | 4,044 | 3,622 | — | 3,480 | 142 | |||||||||||||||||
Non-recourse funding obligations | ( 1 | ) | 311 | 215 | — | — | 215 | |||||||||||||||||
Investment contracts | ( 1 | ) | 12,364 | 13,194 | — | — | 13,194 | |||||||||||||||||
Other firm commitments: | ||||||||||||||||||||||||
Commitments to fund limited partnerships | 903 | — | — | — | — | — | ||||||||||||||||||
Commitments to fund bank loan investments | 52 | — | — | — | — | — | ||||||||||||||||||
Ordinary course of business lendingcommitments | 188 | — | — | — | — | — |
December 31, 2018 | ||||||||||||||||||||||||
Notional | Carrying | Fair value | ||||||||||||||||||||||
(Amounts in millions) | amount | amount | Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Commercial mortgage loans | (1) | $ | 6,687 | $ | 6,737 | $ | — | $ | — | $ | 6,737 | |||||||||||||
Restricted commercial mortgage loans | (1) | 62 | 66 | — | — | 66 | ||||||||||||||||||
Other invested assets: | ||||||||||||||||||||||||
Bank loan investments | (1) | 248 | 248 | — | — | 248 | ||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||
Long-term borrowings | (1) | 4,025 | 3,577 | — | 3,434 | 143 | ||||||||||||||||||
Non-recourse funding obligations | (1) | 311 | 215 | — | — | 215 | ||||||||||||||||||
Investment contracts | (1) | 13,105 | 13,052 | — | — | 13,052 | ||||||||||||||||||
Other firm commitments: | ||||||||||||||||||||||||
Commitments to fund limited partnerships | 539 | — | — | — | — | — | ||||||||||||||||||
Commitments to fund bank loan investments | 33 | — | — | — | — | — | ||||||||||||||||||
Ordinary course of business lendingcommitments | 73 | — | — | — | — | — |
(Amounts in millions) | Fair value | Primary methodologies | Significant inputs | |||||
U.S. government, agencies and government-sponsored enterprises | $ | 4,987 | Price quotes from trading desk, broker feeds | Bid side prices, trade prices, Option Adjusted Spread (“OAS”) to swap curve, Bond Market Association OAS, Treasury Curve, Agency Bullet Curve, maturity to issuer spread | ||||
State and political subdivisions | $ | 2,575 | Multi-dimensional attribute-based modeling systems, third-party pricing vendors | Trade prices, material event notices, Municipal Market Data benchmark yields, broker quotes | ||||
Non-U.S. government | $ | 2,634 | Matrix pricing, spread priced to benchmark curves, price quotes from market makers | Benchmark yields, trade prices, broker quotes, comparative transactions, issuer spreads, bid-offer spread, market research publications, third-party pricing sources | ||||
U.S. corporate | $ | 28,118 | Multi-dimensional attribute-based modeling systems, broker quotes, price quotes from market makers, OAS-based models | Bid side prices to Treasury Curve, Issuer Curve, which includes sector, quality, duration, OAS percentage and change for spread matrix, trade prices, comparative transactions, Trade Reporting and Compliance Engine (“TRACE”) reports | ||||
Non-U.S. corporate | $ | 10,417 | Multi-dimensional attribute-based modeling systems, OAS-based models, price quotes from market makers | Benchmark yields, trade prices, broker quotes, comparative transactions, issuer spreads, bid-offer spread, market research publications, third-party pricing sources | ||||
Residential mortgage-backed | $ | 2,697 | OAS-based models,single factor binomial models, internally priced | Prepayment and default assumptions, aggregation of bonds with similar characteristics, including collateral type, vintage, tranche type, weighted-average life, weighted-average loan age, issuer program and delinquency ratio, pay up and pay down factors, TRACE reports | ||||
Commercial mortgage-backed | $ | 2,897 | Multi-dimensional attribute-based modeling systems, pricing matrix, spread matrix priced to swap curves, Trepp commercial mortgage-backed securities analytics model | Credit risk, interest rate risk, prepayment speeds, new issue data, collateral performance, origination year, tranche type, original credit ratings, weighted-average life, cash flows, spreads derived from broker quotes, bid side prices, spreads to daily updated swaps curves, TRACE reports | ||||
Other asset-backed | $ | 3,492 | Multi-dimensional attribute-based modeling systems, spread matrix priced to swap curves, price quotes from market makers | Spreads to daily updated swaps curves, spreads derived from trade prices and broker quotes, bid side prices, new issue data, collateral performance, analysis of prepayment speeds, cash flows, collateral loss analytics, historical issue analysis, trade data from market makers, TRACE reports |
(Amounts in millions) | Fair value | Primary methodologies | Significant inputs | |||||
U.S. government, agencies and government-sponsored enterprises | $ | 5,602 | Price quotes from trading desk, broker feeds | Bid side prices, trade prices, Option Adjusted Spread (“OAS”) to swap curve, Bond Market Association OAS, Treasury Curve, Agency Bullet Curve, maturity to issuer spread | ||||
State and political subdivisions | $ | 2,935 | Multi-dimensional attribute-based modeling systems, third-party pricing vendors | Trade prices, material event notices, Municipal Market Data benchmark yields, broker quotes | ||||
Non-U.S. government | $ | 1,527 | Matrix pricing, spread priced to benchmark curves, price quotes from market makers | Benchmark yields, trade prices, broker quotes, comparative transactions, issuer spreads, bid-offer spread, market research publications, third-party pricing sources | ||||
U.S. corporate | $ | 30,874 | Multi-dimensional attribute-based modeling systems, broker quotes, price quotes from market makers, OAS-based models | Bid side prices to Treasury Curve, Issuer Curve, which includes sector, quality, duration, OAS percentage and change for spread matrix, trade prices, comparative transactions, Trade Reporting and Compliance Engine (“TRACE”) reports | ||||
Non-U.S. corporate | $ | 8,589 | Multi-dimensional attribute-based modeling systems, OAS-based models, price quotes from market makers | Benchmark yields, trade prices, broker quotes, comparative transactions, issuer spreads, bid-offer spread, market research publications, third-party pricing sources | ||||
Residential mortgage-backed | $ | 2,160 | OAS-based models, single factor binomial models, internally priced | Prepayment and default assumptions, aggregation of bonds with similar characteristics, including collateral type, vintage, tranche type, weighted-average life, weighted-average loan age, issuer program and delinquency ratio, pay up and pay down factors, TRACE reports |
Commercial mortgage-backed | $ | 2,949 | Multi-dimensional attribute-based modeling systems, pricing matrix, spread matrix priced to swap curves, Trepp commercial mortgage-backed securities analytics model | Credit risk, interest rate risk, prepayment speeds, new issue data, collateral performance, origination year, tranche type, original credit ratings, weighted-average life, cash flows, spreads derived from broker quotes, bid side prices, spreads to daily updated swaps curves, TRACE reports | ||||
Other asset-backed | $ | 2,847 | Multi-dimensional attribute-based modeling systems, spread matrix priced to swap curves, price quotes from market makers | Spreads to daily updated swaps curves, spreads derived from trade prices and broker quotes, bid side prices, new issue data, collateral performance, analysis of prepayment speeds, cash flows, collateral loss analytics, historical issue analysis, trade data from market makers, TRACE reports |
• | Broker quotes: non-U.S. corporate, residential mortgage-backed, commercial mortgage-backed and other asset-backed securities are |
valued using broker quotes. Broker quotes are obtained from third-party providers that have current market knowledge to provide a reasonable price for securities not routinely priced by third-party pricing services. Brokers utilized for valuation of assets are reviewed annually. The fair value of our Level 3 fixed maturity securities priced by broker quotes was $863 million as of June 30, 2020. |
• | Internal models: non-U.S. corporate, residential mortgage-backed and other asset-backed securities are valued using internal models. The primary inputs to the valuation of the bond population include quoted prices for identical assets, or similar assets in markets that are not active, contractual cash flows, duration, call provisions, issuer rating, benchmark yields and credit spreads. Certain private fixed maturity securities are valued using an internal model using market observable inputs such as the interest rate yield curve, as well as published credit spreads for similar securities, which includes significant unobservable inputs. Additionally, we may apply certain price caps and liquidity premiums in the valuation of private fixed maturity securities. Price caps are established using inputs from market participants. For structured securities, the primary inputs to the valuation include quoted prices for identical assets, or similar assets in markets that are not active, contractual cash flows, weighted-average coupon, weighted-average maturity, issuer rating, structure of the security, expected prepayment speeds and volumes, collateral type, current and forecasted loss severity, average delinquency rates, vintage of the loans, geographic region, debt service coverage ratios, payment priority with the tranche, benchmark yields and credit spreads. The fair value of our Level 3 fixed maturity securities priced using internal models was $3,392 million as of June 30, 2020. |
June 30, 2019 | ||||||||||||||||||||
(Amounts in millions) | Total | Level 1 | Level 2 | Level 3 | NAV (1) | |||||||||||||||
Assets | ||||||||||||||||||||
Investments: | ||||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||
U.S. government, agencies and government-sponsoredenterprises | $ | 4,987 | $ | — | $ | 4,987 | $ | — | $ | — | ||||||||||
State and political subdivisions | 2,636 | — | 2,575 | 61 | — | |||||||||||||||
Non-U.S. government | 2,649 | — | 2,649 | — | — | |||||||||||||||
U.S. corporate: | ||||||||||||||||||||
Utilities | 4,879 | — | 4,090 | 789 | — | |||||||||||||||
Energy | 2,713 | — | 2,591 | 122 | — | |||||||||||||||
Finance and insurance | 7,597 | — | 6,990 | 607 | — | |||||||||||||||
Consumer—non-cyclical | 5,552 | — | 5,463 | 89 | — | |||||||||||||||
Technology and communications | 3,156 | — | 3,112 | 44 | — | |||||||||||||||
Industrial | 1,336 | — | 1,296 | 40 | — | |||||||||||||||
Capital goods | 2,620 | — | 2,522 | 98 | — | |||||||||||||||
Consumer—cyclical | 1,741 | — | 1,556 | 185 | — | |||||||||||||||
Transportation | 1,411 | — | 1,357 | 54 | — | |||||||||||||||
Other | 396 | — | 197 | 199 | — | |||||||||||||||
Total U.S. corporate | 31,401 | — | 29,174 | 2,227 | — | |||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||
Utilities | 1,165 | — | 748 | 417 | — | |||||||||||||||
Energy | 1,516 | — | 1,275 | 241 | — | |||||||||||||||
Finance and insurance | 2,628 | — | 2,449 | 179 | — | |||||||||||||||
Consumer—non-cyclical | 710 | — | 642 | 68 | — | |||||||||||||||
Technology and communications | 1,273 | — | 1,246 | 27 | — | |||||||||||||||
Industrial | 1,017 | — | 953 | 64 | — | |||||||||||||||
Capital goods | 695 | — | 514 | 181 | — | |||||||||||||||
Consumer—cyclical | 557 | — | 431 | 126 | — | |||||||||||||||
Transportation | 841 | — | 642 | 199 | — | |||||||||||||||
Other | 2,245 | — | 2,116 | 129 | — | |||||||||||||||
Total non-U.S. corporate | 12,647 | — | 11,016 | 1,631 | — | |||||||||||||||
Residential mortgage-backed | 2,738 | — | 2,697 | 41 | — | |||||||||||||||
Commercial mortgage-backed | 2,989 | — | 2,897 | 92 | — | |||||||||||||||
Other asset-backed | 3,727 | — | 3,492 | 235 | — | |||||||||||||||
Total fixed maturity securities | 63,774 | — | 59,487 | 4,287 | — | |||||||||||||||
Equity securities | 644 | 519 | 69 | 56 | — | |||||||||||||||
Other invested assets: | ||||||||||||||||||||
Derivative assets: | ||||||||||||||||||||
Interest rate swaps | 144 | — | 144 | — | — | |||||||||||||||
Interest rate swaps in a foreign currency | 35 | — | 35 | — | — | |||||||||||||||
Interest rate caps and floors | 16 | — | 16 | — | — | |||||||||||||||
Foreign currency swaps | 6 | — | 6 | — | — | |||||||||||||||
Equity index options | 65 | — | — | 65 | — | |||||||||||||||
Other foreign currency contracts | 14 | — | 14 | — | — | |||||||||||||||
Total derivative assets | 280 | — | 215 | 65 | — | |||||||||||||||
Securities lending collateral | 113 | — | 113 | — | — | |||||||||||||||
Short-term investments | 273 | — | 273 | — | — | |||||||||||||||
Limited partnerships | 401 | — | — | — | 401 | |||||||||||||||
Total other invested assets | 1,067 | — | 601 | 65 | 401 | |||||||||||||||
Reinsurance recoverable (2) | 20 | — | — | 20 | — | |||||||||||||||
Separate account assets | 6,187 | 6,187 | — | — | — | |||||||||||||||
Total assets | $ | 71,692 | $ | 6,706 | $ | 60,157 | $ | 4,428 | $ | 401 | ||||||||||
June 30, 2020 | ||||||||||||||||||||
(Amounts in millions) | Total | Level 1 | Level 2 | Level 3 | NAV (1) | |||||||||||||||
Assets | ||||||||||||||||||||
Investments: | ||||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises | $ | 5,602 | $ | — | $ | 5,602 | $ | — | $ | — | ||||||||||
State and political subdivisions | 2,998 | — | 2,935 | 63 | — | |||||||||||||||
Non-U.S. government | 1,542 | — | 1,542 | — | — | |||||||||||||||
U.S. corporate: | ||||||||||||||||||||
Utilities | 5,270 | — | 4,334 | 936 | — | |||||||||||||||
Energy | 2,594 | — | 2,471 | 123 | — | |||||||||||||||
Finance and insurance | 8,403 | — | 7,852 | 551 | — | |||||||||||||||
Consumer—non-cyclical | 6,277 | — | 6,174 | 103 | — | |||||||||||||||
Technology and communications | 3,411 | — | 3,345 | 66 | — | |||||||||||||||
Industrial | 1,503 | — | 1,464 | 39 | — | |||||||||||||||
Capital goods | 3,028 | — | 2,931 | 97 | — | |||||||||||||||
Consumer—cyclical | 1,966 | — | 1,768 | 198 | — | |||||||||||||||
Transportation | 1,565 | — | 1,511 | 54 | — | |||||||||||||||
Other | 378 | — | 213 | 165 | — | |||||||||||||||
Total U.S. corporate | 34,395 | — | 32,063 | 2,332 | — | |||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||
Utilities | 879 | — | 522 | 357 | — | |||||||||||||||
Energy | 1,275 | — | 1,038 | 237 | — | |||||||||||||||
Finance and insurance | 2,466 | — | 2,155 | 311 | — | |||||||||||||||
Consumer—non-cyclical | 777 | — | 723 | 54 | — | |||||||||||||||
Technology and communications | 1,247 | — | 1,219 | 28 | — | |||||||||||||||
Industrial | 995 | — | 903 | 92 | — | |||||||||||||||
Capital goods | 613 | — | 440 | 173 | — | |||||||||||||||
Consumer—cyclical | 407 | — | 251 | 156 | — | |||||||||||||||
Transportation | 635 | — | 494 | 141 | — | |||||||||||||||
Other | 1,591 | — | 1,446 | 145 | — | |||||||||||||||
Total non-U.S. corporate | 10,885 | — | 9,191 | 1,694 | — | |||||||||||||||
Residential mortgage-backed | 2,184 | — | 2,160 | 24 | — | |||||||||||||||
Commercial mortgage-backed | 2,970 | — | 2,949 | 21 | — | |||||||||||||||
Other asset-backed | 2,968 | — | 2,847 | 121 | — | |||||||||||||||
Total fixed maturity securities | 63,544 | — | 59,289 | 4,255 | — | |||||||||||||||
Equity securities | 206 | 45 | 108 | 53 | — | |||||||||||||||
Other invested assets: | ||||||||||||||||||||
Derivative assets: | ||||||||||||||||||||
Interest rate swaps | 939 | — | 939 | — | — | |||||||||||||||
Foreign currency swaps | 17 | — | 17 | — | — | |||||||||||||||
Equity index options | 66 | — | — | 66 | — | |||||||||||||||
Other foreign currency contracts | 2 | — | 2 | — | — | |||||||||||||||
Total derivative assets | 1,024 | — | 958 | 66 | — | |||||||||||||||
Securities lending collateral | 59 | — | 59 | — | — | |||||||||||||||
Short-term investments | 190 | — | 190 | — | — | |||||||||||||||
Limited partnerships | 598 | — | — | — | 598 | |||||||||||||||
Total other invested assets | 1,871 | — | 1,207 | 66 | 598 | |||||||||||||||
Reinsurance recoverable (2) | 38 | — | — | 38 | — | |||||||||||||||
Separate account assets | 5,536 | 5,536 | — | — | — | |||||||||||||||
Total assets | $ | 71,195 | $ | 5,581 | $ | 60,604 | $ | 4,412 | $ | 598 | ||||||||||
(1) |
December 31, 2018 | ||||||||||||||||||||
(Amounts in millions) | Total | Level 1 | Level 2 | Level 3 | NAV (1) | |||||||||||||||
Assets | ||||||||||||||||||||
Investments: | ||||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||
U.S. government, agencies and government-sponsoredenterprises | $ | 4,631 | $ | — | $ | 4,631 | $ | — | $ | — | ||||||||||
State and political subdivisions | 2,552 | — | 2,501 | 51 | — | |||||||||||||||
Non-U.S. government | 2,393 | — | 2,393 | — | — | |||||||||||||||
U.S. corporate: | ||||||||||||||||||||
Utilities | 4,675 | — | 4,032 | 643 | — | |||||||||||||||
Energy | 2,419 | — | 2,298 | 121 | — | |||||||||||||||
Finance and insurance | 6,822 | — | 6,288 | 534 | — | |||||||||||||||
Consumer—non-cyclical | 5,048 | — | 4,975 | 73 | — | |||||||||||||||
Technology and communications | 2,855 | — | 2,805 | 50 | — | |||||||||||||||
Industrial | 1,238 | — | 1,199 | 39 | — | |||||||||||||||
Capital goods | 2,391 | — | 2,299 | 92 | — | |||||||||||||||
Consumer—cyclical | 1,597 | — | 1,386 | 211 | — | |||||||||||||||
Transportation | 1,320 | — | 1,263 | 57 | — | |||||||||||||||
Other | 397 | — | 219 | 178 | — | |||||||||||||||
Total U.S. corporate | 28,762 | — | 26,764 | 1,998 | — | |||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||
Utilities | 1,041 | — | 637 | 404 | — | |||||||||||||||
Energy | 1,369 | — | 1,152 | 217 | — | |||||||||||||||
Finance and insurance | 2,423 | — | 2,252 | 171 | — | |||||||||||||||
Consumer—non-cyclical | 739 | — | 633 | 106 | — | |||||||||||||||
Technology and communications | 1,165 | — | 1,139 | 26 | — | |||||||||||||||
Industrial | 945 | — | 884 | 61 | — | |||||||||||||||
Capital goods | 615 | — | 442 | 173 | — | |||||||||||||||
Consumer—cyclical | 520 | — | 398 | 122 | — | |||||||||||||||
Transportation | 720 | — | 549 | 171 | — | |||||||||||||||
Other | 2,300 | — | 2,219 | 81 | — | |||||||||||||||
Total non-U.S. corporate | 11,837 | — | 10,305 | 1,532 | — | |||||||||||||||
Residential mortgage-backed | 3,044 | — | 3,009 | 35 | — | |||||||||||||||
Commercial mortgage-backed | 3,016 | — | 2,921 | 95 | — | |||||||||||||||
Other asset-backed | 3,426 | — | 3,261 | 165 | — | |||||||||||||||
Total fixed maturity securities | 59,661 | — | 55,785 | 3,876 | — | |||||||||||||||
Equity securities | 655 | 533 | 64 | 58 | — | |||||||||||||||
Other invested assets: | ||||||||||||||||||||
Derivative assets: | ||||||||||||||||||||
Interest rate swaps | 42 | — | 42 | — | — | |||||||||||||||
Interest rate swaps in a foreign currency | 74 | — | 74 | — | — | |||||||||||||||
Interest rate caps and floors | 7 | — | 7 | — | — | |||||||||||||||
Foreign currency swaps | 6 | — | 6 | — | — | |||||||||||||||
Equity index options | 39 | — | — | 39 | — | |||||||||||||||
Other foreign currency contracts | 10 | — | 10 | — | — | |||||||||||||||
Total derivative assets | 178 | — | 139 | 39 | — | |||||||||||||||
Securities lending collateral | 102 | — | 102 | — | — | |||||||||||||||
Short-term investments | 230 | — | 230 | — | — | |||||||||||||||
Limited partnerships | 318 | — | — | — | 318 | |||||||||||||||
Total other invested assets | 828 | — | 471 | 39 | 318 | |||||||||||||||
Reinsurance recoverable (2 ) | 20 | — | — | 20 | — | |||||||||||||||
Separate account assets | 5,859 | 5,859 | — | — | — | |||||||||||||||
Total assets | $ | 67,023 | $ | 6,392 | $ | 56,320 | $ | 3,993 | $ | 318 | ||||||||||
Limited partnerships that are measured at fair value using the NAV per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. |
(2) | Represents embedded derivatives associated with the reinsured portion of our GMWB liabilities. |
December 31, 2019 | ||||||||||||||||||||
(Amounts in millions) | Total | Level 1 | Level 2 | Level 3 | NAV (1) | |||||||||||||||
Assets | ||||||||||||||||||||
Investments: | ||||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises | $ | 5,025 | $ | — | $ | 5,025 | $ | — | $ | — | ||||||||||
State and political subdivisions | 2,747 | — | 2,645 | 102 | — | |||||||||||||||
Non-U.S. government | 1,350 | — | 1,350 | — | — | |||||||||||||||
U.S. corporate: | ||||||||||||||||||||
Utilities | 4,997 | — | 4,132 | 865 | — | |||||||||||||||
Energy | 2,699 | — | 2,570 | 129 | — | |||||||||||||||
Finance and insurance | 7,774 | — | 7,202 | 572 | — | |||||||||||||||
Consumer—non-cyclical | 5,701 | — | 5,607 | 94 | — | |||||||||||||||
Technology and communications | 3,245 | — | 3,195 | 50 | — | |||||||||||||||
Industrial | 1,396 | — | 1,356 | 40 | — | |||||||||||||||
Capital goods | 2,711 | — | 2,609 | 102 | — | |||||||||||||||
Consumer—cyclical | 1,760 | — | 1,587 | 173 | — | |||||||||||||||
Transportation | 1,506 | — | 1,428 | 78 | — | |||||||||||||||
Other | 322 | — | 186 | 136 | — | |||||||||||||||
Total U.S. corporate | 32,111 | — | 29,872 | 2,239 | — | |||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||
Utilities | 829 | — | 455 | 374 | — | |||||||||||||||
Energy | 1,319 | — | 1,072 | 247 | — | |||||||||||||||
Finance and insurance | 2,319 | — | 2,085 | 234 | — | |||||||||||||||
Consumer—non-cyclical | 684 | — | 625 | 59 | — | |||||||||||||||
Technology and communications | 1,138 | — | 1,110 | 28 | — | |||||||||||||||
Industrial | 988 | — | 884 | 104 | — | |||||||||||||||
Capital goods | 605 | — | 444 | 161 | — | |||||||||||||||
Consumer—cyclical | 397 | — | 250 | 147 | — | |||||||||||||||
Transportation | 629 | — | 438 | 191 | — | |||||||||||||||
Other | 1,617 | — | 1,477 | 140 | — | |||||||||||||||
Total non-U.S. corporate | 10,525 | — | 8,840 | 1,685 | — | |||||||||||||||
Residential mortgage-backed | 2,270 | — | 2,243 | 27 | — | |||||||||||||||
Commercial mortgage-backed | 3,026 | — | 3,020 | 6 | — | |||||||||||||||
Other asset-backed | 3,285 | — | 3,153 | 132 | — | |||||||||||||||
Total fixed maturity securities | 60,339 | — | 56,148 | 4,191 | — | |||||||||||||||
Equity securities | 239 | 62 | 126 | 51 | — | |||||||||||||||
Other invested assets: | ||||||||||||||||||||
Derivative assets: | ||||||||||||||||||||
Interest rate swaps | 197 | — | 197 | — | — | |||||||||||||||
Foreign currency swaps | 4 | — | 4 | — | — | |||||||||||||||
Equity index options | 81 | — | — | 81 | — | |||||||||||||||
Other foreign currency contracts | 8 | — | 8 | — | — | |||||||||||||||
Total derivative assets | 290 | — | 209 | 81 | — | |||||||||||||||
Securities lending collateral | 51 | — | 51 | — | — | |||||||||||||||
Short-term investments | 211 | — | 211 | — | — | |||||||||||||||
Limited partnerships | 503 | — | — | — | 503 | |||||||||||||||
Total other invested assets | 1,055 | — | 471 | 81 | 503 | |||||||||||||||
Reinsurance recoverable (2) | 20 | — | — | 20 | — | |||||||||||||||
Separate account assets | 6,108 | 6,108 | — | — | — | |||||||||||||||
Total assets | $ | 67,761 | $ | 6,170 | $ | 56,745 | $ | 4,343 | $ | 503 | ||||||||||
(1) | Limited partnerships that are measured at fair value using the NAV per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. |
(2) | Represents embedded derivatives associated with the reinsured portion of our GMWB liabilities. |
Total gains | |||||||||||||||||||||||||||||||||||||||||||||
Total realized and | (losses) | ||||||||||||||||||||||||||||||||||||||||||||
Beginning | unrealized gains | Ending | included in | ||||||||||||||||||||||||||||||||||||||||||
balance | (losses) | balance | net income | ||||||||||||||||||||||||||||||||||||||||||
as of April 1, | Included in net | Included | Transfer into | Transfer out of | as of June 30, | attributable to assets | |||||||||||||||||||||||||||||||||||||||
(Amounts in millions) | 2019 | income | in OCI | Purchases | Sales | Issuances | Settlements | Level 3 (1) | Level 3 (1) | 2019 | still held | ||||||||||||||||||||||||||||||||||
Fixed maturity securities: | |||||||||||||||||||||||||||||||||||||||||||||
State and political subdivisions | $ | 52 | $ | 1 | $ | 8 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 61 | $ | — | |||||||||||||||||||||||
U.S. corporate: | |||||||||||||||||||||||||||||||||||||||||||||
Utilities | 748 | — | 20 | 82 | (13 | ) | — | (38 | ) | — | (10 | ) | 789 | — | |||||||||||||||||||||||||||||||
Energy | 115 | — | 3 | 5 | — | — | (1 | ) | — | — | 122 | — | |||||||||||||||||||||||||||||||||
Finance and insurance | 590 | — | 15 | 10 | — | — | (8 | ) | — | — | 607 | — | |||||||||||||||||||||||||||||||||
Consumer— non-cyclical | 74 | — | 1 | 14 | — | — | — | — | — | 89 | — | ||||||||||||||||||||||||||||||||||
Technology andcommunications | 52 | — | 3 | — | — | — | — | — | (11 | ) | 44 | — | |||||||||||||||||||||||||||||||||
Industrial | 40 | — | — | — | — | — | — | — | — | 40 | — | ||||||||||||||||||||||||||||||||||
Capital goods | 95 | — | 3 | — | — | — | — | — | — | 98 | — | ||||||||||||||||||||||||||||||||||
Consumer—cyclical | 195 | — | 3 | — | — | — | (13 | ) | — | — | 185 | — | |||||||||||||||||||||||||||||||||
Transportation | 54 | — | — | — | — | — | — | — | — | 54 | — | ||||||||||||||||||||||||||||||||||
Other | 199 | — | 3 | — | — | — | (3 | ) | — | — | 199 | — | |||||||||||||||||||||||||||||||||
Total U.S. corporate | 2,162 | — | 51 | 111 | (13 | ) | — | (63 | ) | — | (21 | ) | 2,227 | — | |||||||||||||||||||||||||||||||
Non-U.S. corporate: | |||||||||||||||||||||||||||||||||||||||||||||
Utilities | 435 | — | 7 | — | (7 | ) | — | (17 | ) | — | (1 | ) | 417 | — | |||||||||||||||||||||||||||||||
Energy | 221 | — | 5 | 15 | — | — | — | — | — | 241 | — | ||||||||||||||||||||||||||||||||||
Finance and insurance | 182 | 1 | 7 | 2 | — | — | (13 | ) | — | — | 179 | 1 | |||||||||||||||||||||||||||||||||
Consumer— non-cyclical | 67 | — | 1 | — | — | — | — | — | — | 68 | — | ||||||||||||||||||||||||||||||||||
Technology andcommunications | 27 | — | — | — | — | — | — | — | — | 27 | — | ||||||||||||||||||||||||||||||||||
Industrial | 63 | — | 1 | — | — | — | — | — | — | 64 | — | ||||||||||||||||||||||||||||||||||
Capital goods | 173 | — | 3 | 5 | — | — | — | — | — | 181 | — | ||||||||||||||||||||||||||||||||||
Consumer—cyclical | 125 | — | 2 | — | — | — | (1 | ) | — | — | 126 | — | |||||||||||||||||||||||||||||||||
Transportation | 192 | — | 3 | 4 | — | — | — | — | — | 199 | — | ||||||||||||||||||||||||||||||||||
Other | 90 | — | 4 | 35 | — | — | — | — | — | 129 | — | ||||||||||||||||||||||||||||||||||
Total non-U.S. corporate | 1,575 | 1 | 33 | 61 | (7 | ) | — | (31 | ) | — | (1 | ) | 1,631 | 1 | |||||||||||||||||||||||||||||||
Residential mortgage-backed | 35 | — | 2 | 5 | — | — | (1 | ) | — | — | 41 | — | |||||||||||||||||||||||||||||||||
Commercial mortgage-backed | 98 | — | 7 | 1 | — | — | — | — | (14 | ) | 92 | — | |||||||||||||||||||||||||||||||||
Other asset-backed | 202 | — | 1 | 41 | — | — | (28 | ) | 27 | (8 | ) | 235 | — | ||||||||||||||||||||||||||||||||
Total fixed maturity securities | 4,124 | 2 | 102 | 219 | (20 | ) | — | (123 | ) | 27 | (44 | ) | 4,287 | 1 | |||||||||||||||||||||||||||||||
Equity securities | 55 | — | — | 2 | (1 | ) | — | — | — | — | 56 | — | |||||||||||||||||||||||||||||||||
Other invested assets: | |||||||||||||||||||||||||||||||||||||||||||||
Derivative assets: | |||||||||||||||||||||||||||||||||||||||||||||
Equity index options | 60 | 10 | — | 9 | — | — | (14 | ) | — | — | 65 | 7 | |||||||||||||||||||||||||||||||||
Total derivative assets | 60 | 10 | — | 9 | — | — | (14 | ) | — | — | 65 | 7 | |||||||||||||||||||||||||||||||||
Total other invested assets | 60 | 10 | — | 9 | — | — | (14 | ) | — | — | 65 | 7 | |||||||||||||||||||||||||||||||||
Reinsurance recoverable (2) | 18 | 2 | — | — | — | — | — | — | — | 20 | 2 | ||||||||||||||||||||||||||||||||||
Total Level 3 assets | $ | 4,257 | $ | 14 | $ | 102 | $ | 230 | $ | (21 | ) | $ | — | $ | (137 | ) | $ | 27 | $ | (44 | ) | $ | 4,428 | $ | 10 | ||||||||||||||||||||
Beginning balance as of April 1, 2020 | Total realized and unrealized gains (losses) | Ending balance as of June 30, 2020 | Total gains (losses) attributable to assets still held | |||||||||||||||||||||||||||||||||||||||||||||
(Amounts in millions) | Included net (loss) | Included in OCI | Purchases | Sales | Issuances | Settlements | Transfer into Level 3 (1) | Transfer out of Level 3 (1) | Included in net income | Included in OCI | ||||||||||||||||||||||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||||||||||||||||||||||||||||||
State and political subdivisions | $ | 83 | $ | — | $ | 7 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (27 | ) | $ | 63 | $ | 1 | $ | 6 | |||||||||||||||||||||||
Non-U.S. government | 1 | — | — | — | — | — | (1 | ) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||
U.S. corporate: | ||||||||||||||||||||||||||||||||||||||||||||||||
Utilities | 843 | — | 37 | 32 | — | — | (2 | ) | 26 | — | 936 | — | 37 | |||||||||||||||||||||||||||||||||||
Energy | 124 | 1 | 13 | — | — | — | (2 | ) | — | (13 | ) | 123 | — | 9 | ||||||||||||||||||||||||||||||||||
Finance and insurance | 510 | — | 33 | 21 | — | — | (12 | ) | — | (1 | ) | 551 | — | 33 | ||||||||||||||||||||||||||||||||||
Consumer—non-cyclical | 88 | — | 8 | 8 | — | — | (1 | ) | — | — | 103 | — | 8 | |||||||||||||||||||||||||||||||||||
Technology and communications | 61 | — | 5 | — | — | — | — | — | — | 66 | — | 5 | ||||||||||||||||||||||||||||||||||||
Industrial | 37 | — | 2 | — | — | — | — | — | — | 39 | — | 2 | ||||||||||||||||||||||||||||||||||||
Capital goods | 90 | — | 7 | — | — | — | — | — | — | 97 | — | 7 | ||||||||||||||||||||||||||||||||||||
Consumer—cyclical | 179 | — | 11 | — | — | — | (1 | ) | 9 | — | 198 | — | 11 | |||||||||||||||||||||||||||||||||||
Transportation | 43 | — | 2 | — | — | — | (1 | ) | 10 | — | 54 | — | 2 | |||||||||||||||||||||||||||||||||||
Other | 138 | — | 2 | — | — | — | (2 | ) | 27 | — | 165 | — | 2 | |||||||||||||||||||||||||||||||||||
Total U.S. corporate | 2,113 | 1 | 120 | 61 | — | — | (21 | ) | 72 | (14 | ) | 2,332 | — | 116 | ||||||||||||||||||||||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||||||||||||||||||||||||||||||
Utilities | 355 | — | 23 | 1 | — | — | — | — | (22 | ) | 357 | — | 23 | |||||||||||||||||||||||||||||||||||
Energy | 236 | — | 22 | — | — | — | (26 | ) | 5 | — | 237 | — | 22 | |||||||||||||||||||||||||||||||||||
Finance and insurance | 223 | 1 | 50 | — | — | — | — | 37 | — | 311 | 1 | 49 | ||||||||||||||||||||||||||||||||||||
Consumer—non-cyclical | 58 | — | 5 | — | — | — | — | — | (9 | ) | 54 | — | 4 | |||||||||||||||||||||||||||||||||||
Technology and communications | 27 | — | 1 | — | — | — | — | — | — | 28 | — | 1 | ||||||||||||||||||||||||||||||||||||
Industrial | 92 | — | 8 | — | — | — | — | — | (8 | ) | 92 | — | 7 | |||||||||||||||||||||||||||||||||||
Capital goods | 135 | — | 9 | — | — | — | — | 29 | — | 173 | — | 9 | ||||||||||||||||||||||||||||||||||||
Consumer—cyclical | 164 | — | 12 | — | — | — | (3 | ) | — | (17 | ) | 156 | — | 11 | ||||||||||||||||||||||||||||||||||
Transportation | 108 | — | 11 | — | — | — | — | 22 | — | 141 | — | 11 | ||||||||||||||||||||||||||||||||||||
Other | 131 | — | 9 | 5 | — | — | — | — | — | 145 | — | 9 | ||||||||||||||||||||||||||||||||||||
Total non-U.S. corporate | 1,529 | 1 | 150 | 6 | — | — | (29 | ) | 93 | (56 | ) | 1,694 | 1 | 146 | ||||||||||||||||||||||||||||||||||
Residential mortgage-backed | 24 | — | 1 | — | — | — | (1 | ) | 3 | (3 | ) | 24 | — | — | ||||||||||||||||||||||||||||||||||
Commercial mortgage-backed | — | — | 1 | — | — | — | — | 20 | — | 21 | — | 1 | ||||||||||||||||||||||||||||||||||||
Other asset-backed | 118 | — | 2 | 6 | — | — | (5 | ) | — | — | 121 | — | 3 | |||||||||||||||||||||||||||||||||||
Total fixed maturity securities | 3,868 | 2 | 281 | 73 | — | — | (57 | ) | 188 | (100 | ) | 4,255 | 2 | 272 | ||||||||||||||||||||||||||||||||||
Equity securities | 50 | — | — | 6 | (3 | ) | — | — | — | — | 53 | — | — | |||||||||||||||||||||||||||||||||||
Other invested assets: | ||||||||||||||||||||||||||||||||||||||||||||||||
Derivative assets: | ||||||||||||||||||||||||||||||||||||||||||||||||
Equity index options | 62 | 4 | — | 7 | — | — | (7 | ) | — | — | 66 | 8 | — | |||||||||||||||||||||||||||||||||||
Total derivative assets | 62 | 4 | — | 7 | — | — | (7 | ) | — | — | 66 | 8 | — | |||||||||||||||||||||||||||||||||||
Total other invested assets | 62 | 4 | — | 7 | — | — | (7 | ) | — | — | 66 | 8 | — | |||||||||||||||||||||||||||||||||||
Reinsurance recoverable (2) | 47 | (9 | ) | — | — | — | — | — | — | — | 38 | (9 | ) | — | ||||||||||||||||||||||||||||||||||
Total Level 3 assets | $ | 4,027 | $ | (3 | ) | $ | 281 | $ | 86 | $ | (3 | ) | $ | — | $ | (64 | ) | $ | 188 | $ | (100 | ) | $ | 4,412 | $ | 1 | $ | 272 | ||||||||||||||||||||
(1) | The transfers into and out of Level 3 for fixed maturity securities were related to changes in the primary pricing source and changes in the observability of external information used in determining the fair value, such as external ratings or credit spreads, as well as changes in the industry sectors assigned to specific securities. |
(2) | Represents embedded derivatives associated with the reinsured portion of our GMWB liabilities. |
Beginning balance as of April 1, 2019 | Total realized and unrealized gains (losses) | Purchases | Sales | Issuances | Settlements | Transfer into Level 3 (1) | Transfer out of Level 3 (1) | Ending balance as of June 30, 2019 | Total gains (losses) included in net income (loss) attributable to assets still held | |||||||||||||||||||||||||||||||||||
(Amounts in millions) | Included (loss) | Included in OCI | ||||||||||||||||||||||||||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||||||||||||||||||||||||||
State and political subdivisions | $ | 52 | $ | 1 | $ | 8 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 61 | $ | — | ||||||||||||||||||||||
U.S. corporate: | ||||||||||||||||||||||||||||||||||||||||||||
Utilities | 748 | — | 20 | 82 | (13 | ) | — | (38 | ) | — | (10 | ) | 789 | — | ||||||||||||||||||||||||||||||
Energy | 115 | — | 3 | 5 | — | — | (1 | ) | — | — | 122 | — | ||||||||||||||||||||||||||||||||
Finance and insurance | 590 | — | 15 | 10 | — | — | (8 | ) | — | — | 607 | — | ||||||||||||||||||||||||||||||||
Consumer—non-cyclical | 74 | — | 1 | 14 | — | — | — | — | — | 89 | — | |||||||||||||||||||||||||||||||||
Technology and communications | 52 | — | 3 | — | — | — | — | — | (11 | ) | 44 | — | ||||||||||||||||||||||||||||||||
Industrial | 40 | — | — | — | — | — | — | — | — | 40 | — | |||||||||||||||||||||||||||||||||
Capital goods | 95 | — | 3 | — | — | — | — | — | — | 98 | — | |||||||||||||||||||||||||||||||||
Consumer—cyclical | 195 | — | 3 | — | — | — | (13 | ) | — | — | 185 | — | ||||||||||||||||||||||||||||||||
Transportation | 54 | — | — | — | — | — | — | — | — | 54 | — | |||||||||||||||||||||||||||||||||
Other | 199 | — | 3 | — | — | — | (3 | ) | — | — | 199 | — | ||||||||||||||||||||||||||||||||
Total U.S. corporate | 2,162 | — | 51 | 111 | (13 | ) | — | (63 | ) | — | (21 | ) | 2,227 | — | ||||||||||||||||||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||||||||||||||||||||||||||
Utilities | 435 | — | 7 | — | (7 | ) | — | (17 | ) | — | (1 | ) | 417 | — | ||||||||||||||||||||||||||||||
Energy | 221 | — | 5 | 15 | — | — | — | — | — | 241 | — | |||||||||||||||||||||||||||||||||
Finance and insurance | 182 | 1 | 7 | 2 | — | — | (13 | ) | — | — | 179 | 1 | ||||||||||||||||||||||||||||||||
Consumer—non-cyclical | 67 | — | 1 | — | — | — | — | — | — | 68 | — | |||||||||||||||||||||||||||||||||
Technology and communications | 27 | — | — | — | — | — | — | — | — | 27 | — | |||||||||||||||||||||||||||||||||
Industrial | 63 | — | 1 | — | — | — | — | — | — | 64 | — | |||||||||||||||||||||||||||||||||
Capital goods | 173 | — | 3 | 5 | — | — | — | — | — | 181 | — | |||||||||||||||||||||||||||||||||
Consumer—cyclical | 125 | — | 2 | — | — | — | (1 | ) | — | — | 126 | — | ||||||||||||||||||||||||||||||||
Transportation | 192 | — | 3 | 4 | — | — | — | — | — | 199 | — | |||||||||||||||||||||||||||||||||
Other | 90 | — | 4 | 35 | — | — | — | — | — | 129 | — | |||||||||||||||||||||||||||||||||
Total non-U.S. corporate | 1,575 | 1 | 33 | 61 | (7 | ) | — | (31 | ) | — | (1 | ) | 1,631 | 1 | ||||||||||||||||||||||||||||||
Residential mortgage-backed | 35 | — | 1 | — | — | — | — | — | — | 36 | — | |||||||||||||||||||||||||||||||||
Commercial mortgage-backed | 98 | — | 7 | 1 | — | — | — | — | (14 | ) | 92 | — | ||||||||||||||||||||||||||||||||
Other asset-backed | 197 | — | 1 | 42 | — | — | (29 | ) | 27 | (4 | ) | 234 | — | |||||||||||||||||||||||||||||||
Total fixed maturity securities | 4,119 | 2 | 101 | 215 | (20 | ) | — | (123 | ) | 27 | (40 | ) | 4,281 | 1 | ||||||||||||||||||||||||||||||
Equity securities | 55 | — | — | 2 | (1 | ) | — | — | — | — | 56 | — | ||||||||||||||||||||||||||||||||
Other invested assets: | ||||||||||||||||||||||||||||||||||||||||||||
Derivative assets: | ||||||||||||||||||||||||||||||||||||||||||||
Equity index options | 60 | 10 | — | 9 | — | — | (14 | ) | — | — | 65 | 7 | ||||||||||||||||||||||||||||||||
Total derivative assets | 60 | 10 | — | 9 | — | — | (14 | ) | — | — | 65 | 7 | ||||||||||||||||||||||||||||||||
Total other invested assets | 60 | 10 | — | 9 | — | — | (14 | ) | — | — | 65 | 7 | ||||||||||||||||||||||||||||||||
Reinsurance recoverable (2) | 18 | 2 | — | — | — | — | — | — | — | 20 | 2 | |||||||||||||||||||||||||||||||||
Total Level 3 assets | $ | 4,252 | $ | 14 | $ | 101 | $ | 226 | $ | (21 | ) | $ | — | $ | (137 | ) | $ | 27 | $ | (40 | ) | $ | 4,422 | $ | 10 | |||||||||||||||||||
Total gains | |||||||||||||||||||||||||||||||||||||||||||||
Total realized and | (losses) | ||||||||||||||||||||||||||||||||||||||||||||
Beginning | unrealized gains | Ending | included in | ||||||||||||||||||||||||||||||||||||||||||
balance | (losses) | balance | net income | ||||||||||||||||||||||||||||||||||||||||||
as of | Included | Transfer | Transfer | as of | attributable | ||||||||||||||||||||||||||||||||||||||||
(Amounts in millions) | April 1, 2018 | in net income | Included in OCI | Purchases | Sales | Issuances | Settlements | into Level 3 (1) | out of Level 3 (1) | June 30, 2018 | to assets still held | ||||||||||||||||||||||||||||||||||
Fixed maturity securities: | |||||||||||||||||||||||||||||||||||||||||||||
State and political subdivisions | $ | 53 | $ | — | $ | (1 | ) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 52 | $ | — | ||||||||||||||||||||||
U.S. corporate: | |||||||||||||||||||||||||||||||||||||||||||||
Utilities | 553 | (1 | ) | (7 | ) | 66 | (12 | ) | — | (2 | ) | 25 | — | 622 | — | ||||||||||||||||||||||||||||||
Energy | 146 | — | — | — | — | — | (1 | ) | — | (7 | ) | 138 | — | ||||||||||||||||||||||||||||||||
Finance and insurance | 580 | — | (41 | ) | — | — | — | (74 | ) | — | (7 | ) | 458 | — | |||||||||||||||||||||||||||||||
Consumer— non-cyclical | 79 | — | — | — | — | — | — | — | — | 79 | — | ||||||||||||||||||||||||||||||||||
Technology andcommunications | 25 | — | 1 | 4 | — | — | (18 | ) | — | — | 12 | — | |||||||||||||||||||||||||||||||||
Industrial | 39 | — | 1 | — | — | — | — | — | — | 40 | — | ||||||||||||||||||||||||||||||||||
Capital goods | 103 | — | (1 | ) | 24 | — | — | — | — | (7 | ) | 119 | — | ||||||||||||||||||||||||||||||||
Consumer—cyclical | 252 | — | (1 | ) | 7 | (3 | ) | — | (1 | ) | — | — | 254 | — | |||||||||||||||||||||||||||||||
Transportation | 57 | — | — | — | — | — | (1 | ) | — | — | 56 | — | |||||||||||||||||||||||||||||||||
Other | 166 | — | — | — | (10 | ) | — | (3 | ) | — | — | 153 | — | ||||||||||||||||||||||||||||||||
Total U.S. corporate | 2,000 | (1 | ) | (48 | ) | 101 | (25 | ) | — | (100 | ) | 25 | (21 | ) | 1,931 | — | |||||||||||||||||||||||||||||
Non-U.S. corporate: | |||||||||||||||||||||||||||||||||||||||||||||
Utilities | 336 | — | (4 | ) | — | — | — | — | 15 | (14 | ) | 333 | — | ||||||||||||||||||||||||||||||||
Energy | 195 | — | (2 | ) | — | — | — | (18 | ) | — | — | 175 | — | ||||||||||||||||||||||||||||||||
Finance and insurance | 153 | 1 | (3 | ) | 1 | — | — | (1 | ) | — | (1 | ) | 150 | 1 | |||||||||||||||||||||||||||||||
Consumer— non-cyclical | 120 | — | (1 | ) | — | — | — | (11 | ) | — | — | 108 | — | ||||||||||||||||||||||||||||||||
Technology andcommunications | 28 | — | 1 | — | — | — | (13 | ) | — | — | 16 | — | |||||||||||||||||||||||||||||||||
Industrial | 108 | — | (1 | ) | 3 | — | — | (5 | ) | — | — | 105 | — | ||||||||||||||||||||||||||||||||
Capital goods | 186 | 1 | — | — | — | — | (21 | ) | — | — | 166 | 1 | |||||||||||||||||||||||||||||||||
Consumer—cyclical | 52 | — | — | — | (1 | ) | — | (3 | ) | — | — | 48 | — | ||||||||||||||||||||||||||||||||
Transportation | 166 | — | (2 | ) | 22 | — | — | — | 17 | — | 203 | — | |||||||||||||||||||||||||||||||||
Other | 83 | — | (1 | ) | — | — | — | — | — | — | 82 | — | |||||||||||||||||||||||||||||||||
Total non-U.S. corporate | 1,427 | 2 | (13 | ) | 26 | (1 | ) | — | (72 | ) | 32 | (15 | ) | 1,386 | 2 | ||||||||||||||||||||||||||||||
Residential mortgage-backed | 34 | — | 1 | 17 | — | — | (1 | ) | — | (17 | ) | 34 | — | ||||||||||||||||||||||||||||||||
Commercial mortgage-backed | 6 | — | — | 28 | — | — | — | 13 | (3 | ) | 44 | — | |||||||||||||||||||||||||||||||||
Other asset-backed | 172 | — | (1 | ) | 6 | — | — | (24 | ) | 45 | (32 | ) | 166 | — | |||||||||||||||||||||||||||||||
Total fixed maturity securities | 3,692 | 1 | (62 | ) | 178 | (26 | ) | — | (197 | ) | 115 | (88 | ) | 3,613 | 2 | ||||||||||||||||||||||||||||||
Equity securities | 45 | — | — | 1 | — | — | — | — | — | 46 | — | ||||||||||||||||||||||||||||||||||
Other invested assets: | |||||||||||||||||||||||||||||||||||||||||||||
Derivative assets: | |||||||||||||||||||||||||||||||||||||||||||||
Equity index options | 60 | 8 | — | 15 | — | — | (13 | ) | — | — | 70 | 8 | |||||||||||||||||||||||||||||||||
Total derivative assets | 60 | 8 | — | 15 | — | — | (13 | ) | — | — | 70 | 8 | |||||||||||||||||||||||||||||||||
Total other invested assets | 60 | 8 | — | 15 | — | — | (13 | ) | — | — | 70 | 8 | |||||||||||||||||||||||||||||||||
Reinsurance recoverable (2) | 13 | (1 | ) | — | — | — | — | — | — | — | 12 | (1 | ) | ||||||||||||||||||||||||||||||||
Total Level 3 assets | $ | 3,810 | $ | 8 | $ | (62 | ) | $ | 194 | $ | (26 | ) | $ | — | $ | (210 | ) | $ | 115 | $ | (88 | ) | $ | 3,741 | $ | 9 | |||||||||||||||||||
(1) | The transfers into and out of Level 3 for fixed maturity securities were related to changes in the primary pricing source and changes in the observability of external information used in determining the fair value, such as external ratings or credit spreads, as well as changes in the industry sectors assigned to specific securities. |
(2) | Represents embedded derivatives associated with the reinsured portion of our GMWB liabilities. |
Total gains | |||||||||||||||||||||||||||||||||||||||||||||
Total realized and | (losses) | ||||||||||||||||||||||||||||||||||||||||||||
Beginning | unrealized gains | Ending | included in | ||||||||||||||||||||||||||||||||||||||||||
balance | (losses) | balance | net income | ||||||||||||||||||||||||||||||||||||||||||
as of | Included | Transfer | Transfer | as of | attributable | ||||||||||||||||||||||||||||||||||||||||
January 1, | in net | Included | into | out of | June 30, | to assets | |||||||||||||||||||||||||||||||||||||||
(Amounts in millions) | 2019 | income | in OCI | Purchases | Sales | Issuances | Settlements | Level 3 (1) | Level 3 (1) | 2019 | still held | ||||||||||||||||||||||||||||||||||
Fixed maturity securities: | |||||||||||||||||||||||||||||||||||||||||||||
State and political subdivisions | $ | 51 | $ | 2 | $ | 8 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 61 | $ | 1 | |||||||||||||||||||||||
U.S. corporate: | |||||||||||||||||||||||||||||||||||||||||||||
Utilities | 643 | — | 42 | 96 | (14 | ) | — | (40 | ) | 72 | (10 | ) | 789 | — | |||||||||||||||||||||||||||||||
Energy | 121 | — | 7 | 5 | — | — | (11 | ) | — | — | 122 | — | |||||||||||||||||||||||||||||||||
Finance and insurance | 534 | — | 38 | 40 | — | — | (12 | ) | 7 | — | 607 | — | |||||||||||||||||||||||||||||||||
Consumer—non-cyclical | 73 | — | 3 | 14 | — | — | (10 | ) | 9 | — | 89 | — | |||||||||||||||||||||||||||||||||
Technology and communications | 50 | — | 5 | — | — | — | — | — | (11 | ) | 44 | — | |||||||||||||||||||||||||||||||||
Industrial | 39 | — | 1 | — | — | — | — | — | — | 40 | — | ||||||||||||||||||||||||||||||||||
Capital goods | 92 | — | 6 | — | — | — | — | — | — | 98 | — | ||||||||||||||||||||||||||||||||||
Consumer—cyclical | 211 | — | 10 | — | (13 | ) | — | (14 | ) | — | (9 | ) | 185 | — | |||||||||||||||||||||||||||||||
Transportation | 57 | — | 1 | 4 | — | — | (8 | ) | — | — | 54 | — | |||||||||||||||||||||||||||||||||
Other | 178 | — | 6 | 22 | — | — | (15 | ) | 8 | — | 199 | — | |||||||||||||||||||||||||||||||||
Total U.S. corporate | 1,998 | — | 119 | 181 | (27 | ) | — | (110 | ) | 96 | (30 | ) | 2,227 | — | |||||||||||||||||||||||||||||||
Non-U.S. corporate: | |||||||||||||||||||||||||||||||||||||||||||||
Utilities | 404 | — | 23 | 30 | (7 | ) | — | (17 | ) | — | (16 | ) | 417 | — | |||||||||||||||||||||||||||||||
Energy | 217 | — | 12 | 16 | — | — | (4 | ) | — | — | 241 | — | |||||||||||||||||||||||||||||||||
Finance and insurance | 171 | 2 | 18 | 7 | — | — | (13 | ) | — | (6 | ) | 179 | 2 | ||||||||||||||||||||||||||||||||
Consumer—non-cyclical | 106 | 2 | 4 | — | — | — | (44 | ) | — | — | 68 | — | |||||||||||||||||||||||||||||||||
Technology andcommunications | 26 | — | 1 | — | — | — | — | — | — | 27 | — | ||||||||||||||||||||||||||||||||||
Industrial | 61 | — | 3 | — | — | — | — | — | — | 64 | — | ||||||||||||||||||||||||||||||||||
Capital goods | 173 | — | 9 | 10 | — | — | (11 | ) | — | — | 181 | — | |||||||||||||||||||||||||||||||||
Consumer—cyclical | 122 | — | 8 | — | — | — | (4 | ) | — | — | 126 | — | |||||||||||||||||||||||||||||||||
Transportation | 171 | — | 9 | 19 | — | — | — | — | — | 199 | — | ||||||||||||||||||||||||||||||||||
Other | 81 | — | 8 | 35 | — | — | (1 | ) | 6 | — | 129 | — | |||||||||||||||||||||||||||||||||
Total non-U.S. corporate | 1,532 | 4 | 95 | 117 | (7 | ) | — | (94 | ) | 6 | (22 | ) | 1,631 | 2 | |||||||||||||||||||||||||||||||
Residential mortgage-backed | 35 | — | 2 | 5 | — | — | (1 | ) | — | — | 41 | — | |||||||||||||||||||||||||||||||||
Commercial mortgage-backed | 95 | — | 9 | 2 | — | — | — | — | (14 | ) | 92 | — | |||||||||||||||||||||||||||||||||
Other asset-backed | 165 | — | 2 | 95 | — | — | (41 | ) | 28 | (14 | ) | 235 | — | ||||||||||||||||||||||||||||||||
Total fixed maturity securities | 3,876 | 6 | 235 | 400 | (34 | ) | — | (246 | ) | 130 | (80 | ) | 4,287 | 3 | |||||||||||||||||||||||||||||||
Equity securities | 58 | — | — | 2 | (4 | ) | — | — | — | — | 56 | — | |||||||||||||||||||||||||||||||||
Other invested assets: | |||||||||||||||||||||||||||||||||||||||||||||
Derivative assets: | |||||||||||||||||||||||||||||||||||||||||||||
Equity index options | 39 | 27 | — | 21 | — | — | (22 | ) | — | — | 65 | 11 | |||||||||||||||||||||||||||||||||
Total derivative assets | 39 | 27 | — | 21 | — | — | (22 | ) | — | — | 65 | 11 | |||||||||||||||||||||||||||||||||
Total other invested assets | 39 | 27 | — | 21 | — | — | (22 | ) | — | — | 65 | 11 | |||||||||||||||||||||||||||||||||
Reinsurance recoverable (2) | 20 | (1 | ) | — | — | — | 1 | — | — | — | 20 | (1 | ) | ||||||||||||||||||||||||||||||||
Total Level 3 assets | $ | 3,993 | $ | 32 | $ | 235 | $ | 423 | $ | (38 | ) | $ | 1 | $ | (268 | ) | $ | 130 | $ | (80 | ) | $ | 4,428 | $ | 13 | ||||||||||||||||||||
Beginning balance as of January 1, 2020 | Total realized and unrealized gains (losses) | Ending balance as of June 30, 2020 | Total gains (losses) attributable to assets still held | |||||||||||||||||||||||||||||||||||||||||||||
(Amounts in millions) | Included in net income (loss) | Included in OCI | Purchases | Sales | Issuances | Settlements | Transfer into Level 3 (1) | Transfer out of Level 3 (1) | Included in net income (loss) | Included in OCI | ||||||||||||||||||||||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||||||||||||||||||||||||||||||
State and political subdivisions | $ | 102 | $ | 1 | $ | (12 | ) | $ | — | $ | — | $ | — | $ | (1 | ) | $ | — | $ | (27 | ) | $ | 63 | $ | 2 | $ | (13 | ) | ||||||||||||||||||||
Non-U.S. government | — | — | — | — | — | — | (1 | ) | 1 | — | — | — | — | |||||||||||||||||||||||||||||||||||
U.S. corporate: | ||||||||||||||||||||||||||||||||||||||||||||||||
Utilities | 865 | — | 12 | 32 | — | — | (2 | ) | 42 | (13 | ) | 936 | — | 14 | ||||||||||||||||||||||||||||||||||
Energy | 129 | 1 | (2 | ) | 10 | (21 | ) | — | (3 | ) | 22 | (13 | ) | 123 | — | (5 | ) | |||||||||||||||||||||||||||||||
Finance and insurance | 572 | 2 | 2 | 21 | — | — | (24 | ) | — | (22 | ) | 551 | — | 5 | ||||||||||||||||||||||||||||||||||
Consumer—non-cyclical | 94 | — | 2 | 8 | — | — | (1 | ) | — | — | 103 | — | 2 | |||||||||||||||||||||||||||||||||||
Technology and communications | 50 | — | 1 | 20 | — | — | — | — | (5 | ) | 66 | — | 2 | |||||||||||||||||||||||||||||||||||
Industrial | 40 | — | (1 | ) | — | — | — | — | — | — | 39 | — | (1 | ) | ||||||||||||||||||||||||||||||||||
Capital goods | 102 | — | (1 | ) | — | — | — | (4 | ) | — | — | 97 | — | (1 | ) | |||||||||||||||||||||||||||||||||
Consumer—cyclical | 173 | — | 4 | — | — | — | (3 | ) | 24 | — | 198 | — | 4 | |||||||||||||||||||||||||||||||||||
Transportation | 78 | — | (2 | ) | — | — | — | (2 | ) | 10 | (30 | ) | 54 | — | 1 | |||||||||||||||||||||||||||||||||
Other | 136 | — | 1 | 5 | — | — | (4 | ) | 27 | — | 165 | — | 1 | |||||||||||||||||||||||||||||||||||
Total U.S. corporate | 2,239 | 3 | 16 | 96 | (21 | ) | — | (43 | ) | 125 | (83 | ) | 2,332 | — | 22 | |||||||||||||||||||||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||||||||||||||||||||||||||||||
Utilities | 374 | — | 3 | 12 | — | — | — | 21 | (53 | ) | 357 | — | 3 | |||||||||||||||||||||||||||||||||||
Energy | 247 | — | (8 | ) | — | — | — | (26 | ) | 24 | — | 237 | — | (8 | ) | |||||||||||||||||||||||||||||||||
Finance and insurance | 234 | 2 | 9 | 15 | — | — | — | 58 | (7 | ) | 311 | 2 | 10 | |||||||||||||||||||||||||||||||||||
Consumer—non-cyclical | 59 | — | 2 | 8 | — | — | — | 1 | (16 | ) | 54 | — | 1 | |||||||||||||||||||||||||||||||||||
Technology and communications | 28 | — | — | — | — | — | — | — | — | 28 | — | — | ||||||||||||||||||||||||||||||||||||
Industrial | 104 | — | 1 | — | — | — | (5 | ) | — | (8 | ) | 92 | — | — | ||||||||||||||||||||||||||||||||||
Capital goods | 161 | 1 | (2 | ) | — | — | — | (16 | ) | 29 | — | 173 | — | (1 | ) | |||||||||||||||||||||||||||||||||
Consumer—cyclical | 147 | — | (3 | ) | 4 | — | — | (7 | ) | 32 | (17 | ) | 156 | — | (5 | ) | ||||||||||||||||||||||||||||||||
Transportation | 191 | — | 2 | — | — | — | — | 22 | (74 | ) | 141 | — | 6 | |||||||||||||||||||||||||||||||||||
Other | 140 | — | — | 5 | — | — | (1 | ) | 1 | — | 145 | — | — | |||||||||||||||||||||||||||||||||||
Total non-U.S. corporate | 1,685 | 3 | 4 | 44 | — | — | (55 | ) | 188 | (175 | ) | 1,694 | 2 | 6 | ||||||||||||||||||||||||||||||||||
Residential mortgage-backed | 27 | — | — | — | — | — | (1 | ) | 4 | (6 | ) | 24 | — | — | ||||||||||||||||||||||||||||||||||
Commercial mortgage-backed | 6 | — | 2 | — | — | — | — | 20 | (7 | ) | 21 | — | 1 | |||||||||||||||||||||||||||||||||||
Other asset-backed | 132 | — | (2 | ) | 15 | — | — | (22 | ) | — | (2 | ) | 121 | — | (2 | ) | ||||||||||||||||||||||||||||||||
Total fixed maturity securities | 4,191 | 7 | 8 | 155 | (21 | ) | — | (123 | ) | 338 | (300 | ) | 4,255 | 4 | 14 | |||||||||||||||||||||||||||||||||
Equity securities | 51 | — | — | 6 | (4 | ) | — | — | — | — | 53 | — | — | |||||||||||||||||||||||||||||||||||
Other invested assets: | ||||||||||||||||||||||||||||||||||||||||||||||||
Derivative assets: | ||||||||||||||||||||||||||||||||||||||||||||||||
Equity index options | 81 | (9 | ) | — | 18 | — | — | (24 | ) | — | — | 66 | 5 | — | ||||||||||||||||||||||||||||||||||
Total derivative assets | 81 | (9 | ) | — | 18 | — | — | (24 | ) | — | — | 66 | 5 | — | ||||||||||||||||||||||||||||||||||
Total other invested assets | 81 | (9 | ) | — | 18 | — | — | (24 | ) | — | — | 66 | 5 | — | ||||||||||||||||||||||||||||||||||
Reinsurance recoverable (2) | 20 | 17 | — | — | — | 1 | — | — | — | 38 | 17 | — | ||||||||||||||||||||||||||||||||||||
Total Level 3 assets | $ | 4,343 | $ | 15 | $ | 8 | $ | 179 | $ | (25 | ) | $ | 1 | $ | (147 | ) | $ | 338 | $ | (300 | ) | $ | 4,412 | $ | 26 | $ | 14 | |||||||||||||||||||||
(1) | The transfers into and out of Level 3 for fixed maturity securities were related to changes in the primary pricing source and changes in the observability of external information used in determining the fair value, such as external ratings or credit spreads, as well as changes in the industry sectors assigned to specific securities. |
(2) | Represents embedded derivatives associated with the reinsured portion of our GMWB liabilities. |
Total gains | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total realized and | (losses) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning | unrealized gains | Ending | included in | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
balance | (losses) | balance | net income | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
as of | Included | Transfer | Transfer | as of | attributable | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
January 1, | in net | Included | into | out of | June 30, | to assets | Beginning balance as of January 1, 2019 | Total realized and unrealized gains (losses) | Purchases | Sales | Issuances | Settlements | Transfer into Level 3 (1) | Transfer out of Level 3 (1) | Ending balance as of June 30, 2019 | Total gains (losses) included in net income (loss) attributable to assets still held | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Amounts in millions) | 2018 | income | in OCI | Purchases | Sales | Issuances | Settlements | Level 3 (1) | Level 3 (1) | 2018 | still held | Included (loss) | Included in OCI | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fixed maturity securities: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. government, agencies and government-sponsoredenterprises | $ | 1 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (1 | ) | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
State and political subdivisions | 37 | 1 | (4 | ) | — | — | — | — | 18 | — | 52 | 1 | $ | 51 | $ | 2 | $ | 8 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 61 | $ | 1 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. corporate: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Utilities | 574 | (1 | ) | (25 | ) | 69 | (12 | ) | — | (4 | ) | 25 | (4 | ) | 622 | — | 643 | — | 42 | 96 | (14 | ) | — | (40 | ) | 72 | (10 | ) | 789 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Energy | 147 | — | (5 | ) | 22 | — | — | (19 | ) | — | (7 | ) | 138 | — | 121 | — | 7 | 5 | — | — | (11 | ) | — | — | 122 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Finance and insurance | 626 | 1 | (67 | ) | 26 | — | — | (110 | ) | — | (18 | ) | 458 | 1 | 534 | — | 38 | 40 | — | — | (12 | ) | 7 | — | 607 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer—non-cyclical | 81 | — | (2 | ) | — | — | — | — | — | — | 79 | — | 73 | — | 3 | 14 | — | — | (10 | ) | 9 | — | 89 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Technology andcommunications | 73 | — | (5 | ) | 4 | — | — | (60 | ) | — | — | 12 | — | 50 | — | 5 | — | — | — | — | — | (11 | ) | 44 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Industrial | 39 | — | 1 | — | — | — | — | — | — | 40 | — | 39 | — | 1 | — | — | — | — | — | — | 40 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Capital goods | 121 | — | (9 | ) | 24 | — | — | (10 | ) | — | (7 | ) | 119 | — | 92 | — | 6 | — | — | — | — | — | — | 98 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer—cyclical | 262 | — | (10 | ) | 17 | (3 | ) | — | (12 | ) | — | — | 254 | — | 211 | — | 10 | — | (13 | ) | — | (14 | ) | — | (9 | ) | 185 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Transportation | 60 | — | (1 | ) | — | — | — | (3 | ) | — | — | 56 | — | 57 | — | 1 | 4 | — | — | (8 | ) | — | — | 54 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other | 169 | — | (1 | ) | — | (10 | ) | — | (5 | ) | — | — | 153 | — | 178 | — | 6 | 22 | — | — | (15 | ) | 8 | — | 199 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total U.S. corporate | 2,152 | — | (124 | ) | 162 | (25 | ) | — | (223 | ) | 25 | (36 | ) | 1,931 | 1 | 1,998 | — | 119 | 181 | (27 | ) | — | (110 | ) | 96 | (30 | ) | 2,227 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-U.S. corporate: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Utilities | 343 | — | (13 | ) | 22 | — | — | (20 | ) | 15 | (14 | ) | 333 | — | 404 | — | 23 | 30 | (7 | ) | — | (17 | ) | — | (16 | ) | 417 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Energy | 176 | — | (6 | ) | 23 | — | — | (18 | ) | — | — | 175 | — | 217 | — | 12 | 16 | — | — | (4 | ) | — | — | 241 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Finance and insurance | 161 | 2 | (11 | ) | 1 | — | — | (2 | ) | — | (1 | ) | 150 | 2 | 171 | 2 | 18 | 7 | — | — | (13 | ) | — | (6 | ) | 179 | 2 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer—non-cyclical | 124 | — | (4 | ) | — | — | — | (12 | ) | — | — | 108 | — | 106 | 2 | 4 | — | — | — | (44 | ) | — | — | 68 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Technology andcommunications | 29 | — | — | — | — | — | (13 | ) | — | — | 16 | — | 26 | — | 1 | — | — | — | — | — | — | 27 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Industrial | 116 | — | (4 | ) | 3 | — | — | (10 | ) | — | — | 105 | — | 61 | — | 3 | — | — | — | — | — | — | 64 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Capital goods | 191 | 1 | (5 | ) | — | — | — | (21 | ) | — | — | 166 | 1 | 173 | — | 9 | 10 | — | — | (11 | ) | — | — | 181 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer—cyclical | 54 | — | (2 | ) | — | (1 | ) | — | (3 | ) | — | — | 48 | — | 122 | — | 8 | — | — | — | (4 | ) | — | — | 126 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Transportation | 170 | — | (6 | ) | 22 | — | — | — | 17 | — | 203 | — | 171 | — | 9 | 19 | — | — | — | — | — | 199 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other | 52 | — | (3 | ) | 33 | — | — | — | — | — | 82 | — | 81 | — | 8 | 35 | — | — | (1 | ) | 6 | — | 129 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total non-U.S. corporate | 1,416 | 3 | (54 | ) | 104 | (1 | ) | — | (99 | ) | 32 | (15 | ) | 1,386 | 3 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total n on-U.S. | 1,532 | 4 | 95 | 117 | (7 | ) | — | (94 | ) | 6 | (22 | ) | 1,631 | 2 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage-backed | 77 | — | — | 29 | — | — | (1 | ) | — | (71 | ) | 34 | — | 35 | — | 1 | — | — | — | — | — | — | 36 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial mortgage-backed | 30 | — | (2 | ) | 35 | — | — | — | 13 | (32 | ) | 44 | — | 95 | — | 9 | 2 | — | — | — | — | (14 | ) | 92 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other asset-backed | 237 | — | (3 | ) | 61 | — | — | (56 | ) | 48 | (121 | ) | 166 | — | 154 | — | 2 | 96 | — | — | (42 | ) | 28 | (4 | ) | 234 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total fixed maturity securities | 3,950 | 4 | (187 | ) | 391 | (26 | ) | — | (380 | ) | 136 | (275 | ) | 3,613 | 5 | 3,865 | 6 | 234 | 396 | (34 | ) | — | (246 | ) | 130 | (70 | ) | 4,281 | 3 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity securities | 44 | — | — | 5 | (3 | ) | — | — | — | — | 46 | — | 58 | — | — | 2 | (4 | ) | — | — | — | — | 56 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other invested assets: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative assets: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity index options | 80 | (7 | ) | — | 29 | — | — | (32 | ) | — | — | 70 | (4 | ) | 39 | 27 | — | 21 | — | — | (22 | ) | — | — | 65 | 11 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total derivative assets | 80 | (7 | ) | — | 29 | — | — | (32 | ) | — | — | 70 | (4 | ) | 39 | 27 | — | 21 | — | — | (22 | ) | — | — | 65 | 11 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total other invested assets | 80 | (7 | ) | — | 29 | — | — | (32 | ) | — | — | 70 | (4 | ) | 39 | 27 | — | 21 | — | — | (22 | ) | — | — | 65 | 11 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance recoverable (2) | 14 | (3 | ) | — | — | — | 1 | — | — | — | 12 | (3 | ) | 20 | (1 | ) | — | — | — | 1 | — | — | — | 20 | (1 | ) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total Level 3 assets | $ | 4,088 | $ | (6 | ) | $ | (187 | ) | $ | 425 | $ | (29 | ) | $ | 1 | $ | (412 | ) | $ | 136 | $ | (275 | ) | $ | 3,741 | $ | (2 | ) | $ | 3,982 | $ | 32 | $ | 234 | $ | 419 | $ | (38 | ) | $ | 1 | $ | (268 | ) | $ | 130 | $ | (70 | ) | $ | 4,422 | $ | 13 | ||||||||||||||||||||||||||||||||||||
(1) | The transfers into and out of Level 3 for fixed maturity securities were related to changes in the primary pricing source and changes in the observability of external information used in determining the fair value, such as external ratings or credit spreads, as well as changes in the industry sectors assigned to specific securities. |
(2) | Represents embedded derivatives associated with the reinsured portion of our GMWB liabilities. |
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Total realized and unrealized gains (losses) included in net income: | ||||||||||||||||
Net investment income | $ | 2 | $ | 2 | $ | 6 | $ | 5 | ||||||||
Net investment gains (losses) | 12 | 6 | 26 | (11 | ) | |||||||||||
Total | $ | 14 | $ | 8 | $ | 32 | $ | (6 | ) | |||||||
Total gains (losses) included in net income attributable to assets still held: | ||||||||||||||||
Net investment income | $ | 1 | $ | 2 | $ | 3 | $ | 5 | ||||||||
Net investment gains (losses) | 9 | 7 | 10 | (7 | ) | |||||||||||
Total | $ | 10 | $ | 9 | $ | 13 | $ | (2 | ) | |||||||
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Total realized and unrealized gains (losses) included in net income (loss): | ||||||||||||||||
Net investment income | $ | 2 | $ | 2 | $ | 6 | $ | 6 | ||||||||
Net investment gains (losses) | (5 | ) | 12 | 9 | 26 | |||||||||||
Total | $ | (3 | ) | $ | 14 | $ | 15 | $ | 32 | |||||||
Total gains (losses) included in net income (loss) attributable to assets still held: | ||||||||||||||||
Net investment income | $ | 2 | $ | 1 | $ | 4 | $ | 3 | ||||||||
Net investment gains (losses) | (1 | ) | 9 | 22 | 10 | |||||||||||
Total | $ | 1 | $ | 10 | $ | 26 | $ | 13 | ||||||||
(Amounts in millions) | Valuation technique | Fair value | Unobservable input | Range | Weighted-average | |||||||||
Fixed maturity securities: | ||||||||||||||
U.S. corporate: | ||||||||||||||
Utilities | Internal models | $ | 719 | Credit spreads | 66bps - 326bps | 146 bps | ||||||||
Energy | Internal models | 99 | Credit spreads | 82bps - 311bps | 167 bps | |||||||||
Finance and insurance | Internal models | 595 | Credit spreads | 68bps - 246bps | 158 bps | |||||||||
Consumer—non-cyclical | Internal models | 89 | Credit spreads | 93bps - 311bps | 159 bps | |||||||||
Technology andcommunications | Internal models | 44 | Credit spreads | 137bps - 311bps | 217 bps | |||||||||
Industrial | Internal models | 40 | Credit spreads | 118bps - 212bps | 155 bps | |||||||||
Capital goods | Internal models | 98 | Credit spreads | 103bps - 277bps | 157 bps | |||||||||
Consumer—cyclical | Internal models | 170 | Credit spreads | 70bps - 218bps | 144 bps | |||||||||
Transportation | Internal models | 54 | Credit spreads | 63bps - 215bps | 109 bps | |||||||||
Other | Internal models | 168 | Credit spreads | 68bps - 131bps | 85 bps | |||||||||
Total U.S. corporate | Internal models | $ | 2,076 | Credit spreads | 63bps - 326bps | 147 bps | ||||||||
Non-U.S. corporate: | ||||||||||||||
Utilities | Internal models | $ | 417 | Credit spreads | 84bps - 215bps | 140 bps | ||||||||
Energy | Internal models | 221 | Credit spreads | 103bps - 277bps | 162 bps | |||||||||
Finance and insurance | Internal models | 179 | Credit spreads | 70bps - 189bps | 128 bps | |||||||||
Consumer—non-cyclical | Internal models | 68 | Credit spreads | 70bps - 170bps | 135 bps | |||||||||
Technology andcommunications | Internal models | 27 | Credit spreads | 124bps - 150bps | 141 bps | |||||||||
Industrial | Internal models | 64 | Credit spreads | 99bps - 157bps | 113 bps | |||||||||
Capital goods | Internal models | 181 | Credit spreads | 93bps - 277bps | 169 bps | |||||||||
Consumer—cyclical | Internal models | 123 | Credit spreads | 81bps - 277bps | 193 bps | |||||||||
Transportation | Internal models | 198 | Credit spreads | 70bps - 218bps | 134 bps | |||||||||
Other | Internal models | 125 | Credit spreads | 109bps - 218bps | 162 bps | |||||||||
Total non-U.S. corporate | Internal models | $ | 1,603 | Credit spreads | 70bps - 277bps | 149 bps | ||||||||
Derivative assets: | ||||||||||||||
Discounted cash | Equity index | |||||||||||||
Equity index options | flows | $ | 65 | volatility | 6 % -29 % | 17% |
(Amounts in millions) | Valuation technique | Fair value | Unobservable input | Range | Weighted-average (1) | |||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||
U.S. corporate: | ||||||||||||||||||||
Utilities | Internal models | $ | 826 | Credit spreads | 71bps - 427bps | 194bps | ||||||||||||||
Energy | Internal models | 8 | Credit spreads | 108bps | N/A | |||||||||||||||
Finance and insurance | Internal models | 497 | Credit spreads | 73bps - 380bps | 206bps | |||||||||||||||
Consumer—non-cyclical | Internal models | 102 | Credit spreads | 83bps - 395bps | 202bps | |||||||||||||||
Technology and communications | Internal models | 66 | Credit spreads | 212bps - 395bps | 271bps | |||||||||||||||
Industrial | Internal models | 39 | Credit spreads | 199bps - 483bps | 293bps | |||||||||||||||
Capital goods | Internal models | 97 | Credit spreads | 120bps - 294bps | 214bps | |||||||||||||||
Consumer—cyclical | Internal models | 161 | Credit spreads | 131bps - 307bps | 208bps | |||||||||||||||
Transportation | Internal models | 44 | Credit spreads | 76bps - 199bps | 144bps | |||||||||||||||
Other | Internal models | 165 | Credit spreads | 99bps - 213bps | 122bps | |||||||||||||||
Total U.S. corporate | Internal models | $ | 2,005 | Credit spreads | 71bps - 483bps | 197bps | ||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||
Utilities | Internal models | $ | 357 | Credit spreads | 97bps - 286bps | 176bps | ||||||||||||||
Energy | Internal models | 82 | Credit spreads | 120bps - 272bps | 175bps | |||||||||||||||
Finance and insurance | Internal models | 209 | Credit spreads | 136bps - 188bps | 133bps | |||||||||||||||
Consumer—non-cyclical | Internal models | 53 | Credit spreads | 107bps - 182bps | 160bps | |||||||||||||||
Technology and communications | Internal models | 28 | Credit spreads | 153bps - 260bps | 221bps | |||||||||||||||
Industrial | Internal models | 92 | Credit spreads | 108bps - 272bps | 193bps | |||||||||||||||
Capital goods | Internal models | 144 | Credit spreads | 107bps - 294bps | 215bps | |||||||||||||||
Consumer—cyclical | Internal models | 45 | Credit spreads | 97bps - 272bps | 194bps | |||||||||||||||
Transportation | Internal models | 114 | Credit spreads | 83bps - 294bps | 175bps | |||||||||||||||
Other | Internal models | 144 | Credit spreads | 121bps - 507bps | 300bps | |||||||||||||||
Total non-U.S. corporate | Internal models | $ | 1,268 | Credit spreads | 83bps - 507bps | 196bps | ||||||||||||||
Derivative assets: | ||||||||||||||||||||
Equity index options | Discounted cash flows | | $ | 66 | Equity index volatility | | 6% - 38% | 28% |
(1) | Unobservable inputs weighted by the relative fair value of the associated instrument for fixed maturity securities and by notional for derivative assets. |
June 30, 2019 | ||||||||||||||||
(Amounts in millions) | Total | Level 1 | Level 2 | Level 3 | ||||||||||||
Liabilities | ||||||||||||||||
Policyholder account balances: | ||||||||||||||||
GMWB embedded derivatives (1) | $ | 325 | $ | — | $ | — | $ | 325 | ||||||||
Fixed index annuity embedded derivatives | 438 | — | — | 438 | ||||||||||||
Indexed universal life embedded derivatives | 15 | — | — | 15 | ||||||||||||
Total policyholder account balances | 778 | — | — | 778 | ||||||||||||
Derivative liabilities: | ||||||||||||||||
Interest rate swaps | 10 | — | 10 | — | ||||||||||||
Foreign currency swaps | 8 | — | 8 | — | ||||||||||||
Other foreign currency contracts | 25 | — | 25 | — | ||||||||||||
Total derivative liabilities | 43 | — | 43 | — | ||||||||||||
Total liabilities | $ | 821 | $ | — | $ | 43 | $ | 778 | ||||||||
June 30, 2020 | ||||||||||||||||
(Amounts in millions) | Total | Level 1 | Level 2 | Level 3 | ||||||||||||
Liabilities | ||||||||||||||||
Policyholder account balances: | ||||||||||||||||
GMWB embedded derivatives (1) | $ | 559 | $ | — | $ | — | $ | 559 | ||||||||
Fixed index annuity embedded derivatives | 447 | — | — | 447 | ||||||||||||
Indexed universal life embedded derivatives | 23 | — | — | 23 | ||||||||||||
Total policyholder account balances | 1,029 | — | — | 1,029 | ||||||||||||
Derivative liabilities: | ||||||||||||||||
Other foreign currency contracts | 1 | — | 1 | — | ||||||||||||
Total derivative liabilities | 1 | — | 1 | — | ||||||||||||
Total liabilities | $ | 1,030 | $ | — | $ | 1 | $ | 1,029 | ||||||||
(1) | Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
December 31, 2018 | ||||||||||||||||
(Amounts in millions) | Total | Level 1 | Level 2 | Level 3 | ||||||||||||
Liabilities | ||||||||||||||||
Policyholder account balances: | �� | |||||||||||||||
GMWB embedded derivatives (1) | $ | 337 | $ | — | $ | — | $ | 337 | ||||||||
Fixed index annuity embedded derivatives | 389 | — | — | 389 | ||||||||||||
Indexed universal life embedded derivatives | 12 | — | — | 12 | ||||||||||||
Total policyholder account balances | 738 | — | — | 738 | ||||||||||||
Derivative liabilities: | ||||||||||||||||
Interest rate swaps | 102 | — | 102 | — | ||||||||||||
Foreign currency swaps | 23 | — | 23 | — | ||||||||||||
Equity return swaps | 1 | — | 1 | — | ||||||||||||
Other foreign currency contracts | 42 | — | 42 | — | ||||||||||||
Total derivative liabilities | 168 | — | 168 | — | ||||||||||||
Total liabilities | $ | 906 | $ | — | $ | 168 | $ | 738 | ||||||||
December 31, 2019 | ||||||||||||||||
(Amounts in millions) | Total | Level 1 | Level 2 | Level 3 | ||||||||||||
Liabilities | ||||||||||||||||
Policyholder account balances: | ||||||||||||||||
GMWB embedded derivatives (1) | $ | 323 | $ | — | $ | — | $ | 323 | ||||||||
Fixed index annuity embedded derivatives | 452 | — | — | 452 | ||||||||||||
Indexed universal life embedded derivatives | 19 | — | — | 19 | ||||||||||||
Total policyholder account balances | 794 | — | — | 794 | ||||||||||||
Derivative liabilities: | ||||||||||||||||
Interest rate swaps | 10 | — | 10 | — | ||||||||||||
Other foreign currency contracts | 1 | — | 1 | — | ||||||||||||
Total derivative liabilities | 11 | — | 11 | — | ||||||||||||
Total liabilities | $ | 805 | $ | — | $ | 11 | $ | 794 | ||||||||
(1) | Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
Total (gains) | |||||||||||||||||||||||||||||||||||||||||||||
Total realized and | losses | ||||||||||||||||||||||||||||||||||||||||||||
Beginning | unrealized (gains) | Ending | included in | ||||||||||||||||||||||||||||||||||||||||||
balance | losses | balance | net (income) | ||||||||||||||||||||||||||||||||||||||||||
as of | Transfer | Transfer | as of | attributable | |||||||||||||||||||||||||||||||||||||||||
April 1, | Included in | Included | into | out of | June 30, | to liabilities | |||||||||||||||||||||||||||||||||||||||
(Amounts in millions) | 2019 | net (income) | in OCI | Purchases | Sales | Issuances | Settlements | Level 3 | Level 3 | 2019 | still held | ||||||||||||||||||||||||||||||||||
Policyholder account balances: | |||||||||||||||||||||||||||||||||||||||||||||
GMWB embeddedderivatives (1) | $ | 295 | $ | 24 | $ | — | $ | — | $ | — | $ | 6 | $ | — | $ | — | $ | — | $ | 325 | $ | 24 | |||||||||||||||||||||||
Fixed index annuityembedded derivatives | 423 | 20 | — | — | — | — | (5 | ) | — | — | 438 | 20 | |||||||||||||||||||||||||||||||||
Indexed universal lifeembedded derivatives | 13 | 1 | — | — | — | 1 | — | — | — | 15 | 1 | ||||||||||||||||||||||||||||||||||
Total policyholder accountbalances | 731 | 45 | — | — | — | 7 | (5 | ) | — | — | 778 | 45 | |||||||||||||||||||||||||||||||||
Total Level 3 liabilities | $ | 731 | $ | 45 | $ | — | $ | — | $ | — | $ | 7 | $ | (5 | ) | $ | — | $ | — | $ | 778 | $ | 45 | ||||||||||||||||||||||
(Amounts in millions) | Beginning balance as of April 1, 2020 | Total realized and unrealized (gains) losses | Purchases | Sales | Issuances | Settlements | Transfer into Level 3 | Transfer out of Level 3 | Ending balance as of June 30, 2020 | Total (gains) losses attributable to liabilities still held | ||||||||||||||||||||||||||||||||||||||
Included in net (income) loss | Included in OCI | Included in net (income) loss | Included in OCI | |||||||||||||||||||||||||||||||||||||||||||||
Policyholder account balances: | ||||||||||||||||||||||||||||||||||||||||||||||||
GMWB embedded derivatives (1) | $ | 691 | $ | (138 | ) | $ | — | $ | — | $ | — | $ | 6 | $ | — | $ | — | $ | — | $ | 559 | $ | (137 | ) | $ | — | ||||||||||||||||||||||
Fixed index annuity embedded derivatives | 413 | 45 | — | — | — | — | (11 | ) | — | — | 447 | 45 | — | |||||||||||||||||||||||||||||||||||
Indexed universal life embedded derivatives | 21 | (3 | ) | — | — | — | 5 | — | — | — | 23 | (3 | ) | — | ||||||||||||||||||||||||||||||||||
Total policyholder account balances | 1,125 | (96 | ) | — | — | — | 11 | (11 | ) | — | — | 1,029 | (95 | ) | — | |||||||||||||||||||||||||||||||||
Total Level 3 liabilities | $ | 1,125 | $ | (96 | ) | $ | — | $ | — | $ | — | $ | 11 | $ | (11 | ) | $ | — | $ | — | $ | 1,029 | $ | (95 | ) | $ | — | |||||||||||||||||||||
(1) | Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
Total (gains) | |||||||||||||||||||||||||||||||||||||||||||||
Total realized and | losses | ||||||||||||||||||||||||||||||||||||||||||||
Beginning | unrealized (gains) | Ending | included in | ||||||||||||||||||||||||||||||||||||||||||
balance | losses | balance | net (income) | ||||||||||||||||||||||||||||||||||||||||||
as of | Transfer | Transfer | as of | attributable | |||||||||||||||||||||||||||||||||||||||||
April 1, | Included in | Included | into | out of | June 30, | to liabilities | |||||||||||||||||||||||||||||||||||||||
(Amounts in millions) | 2018 | net (income) | in OCI | Purchases | Sales | Issuances | Settlements | Level 3 | Level 3 | 2018 | still held | ||||||||||||||||||||||||||||||||||
Policyholder account balances: | |||||||||||||||||||||||||||||||||||||||||||||
GMWB embeddedderivatives (1) | $ | 242 | $ | (14 | ) | $ | — | $ | — | $ | — | $ | 7 | $ | — | $ | — | $ | — | $ | 235 | $ | (14 | ) | |||||||||||||||||||||
Fixed index annuityembedded derivatives | 408 | 15 | — | — | — | — | (3 | ) | — | — | 420 | 15 | |||||||||||||||||||||||||||||||||
Indexed universal lifeembedded derivatives | 13 | (2 | ) | — | — | — | 2 | — | — | — | 13 | (2 | ) | ||||||||||||||||||||||||||||||||
Total policyholder accountbalances | 663 | (1 | ) | — | — | — | 9 | (3 | ) | — | — | 668 | (1 | ) | |||||||||||||||||||||||||||||||
Total Level 3 liabilities | $ | 663 | $ | (1 | ) | $ | — | $ | — | $ | — | $ | 9 | $ | (3 | ) | $ | — | $ | — | $ | 668 | $ | (1 | ) | ||||||||||||||||||||
Beginning balance as of April 1, 2019 | Total realized and unrealized (gains) losses | Purchases | Sales | Issuances | Settlements | Transfer into Level 3 | Transfer out of Level 3 | Ending balance as of June 30, 2019 | Total (gains) losses included in net (income) loss attributable to liabilities still held | |||||||||||||||||||||||||||||||||||
(Amounts in millions) | Included in net (income) loss | Included in OCI | ||||||||||||||||||||||||||||||||||||||||||
Policyholder account balances: | ||||||||||||||||||||||||||||||||||||||||||||
GMWB embedded derivatives (1) | $ | 295 | $ | 24 | $ | — | $ | — | $ | — | $ | 6 | $ | — | $ | — | $ | — | $ | 325 | $ | 24 | ||||||||||||||||||||||
Fixed index annuity embedded derivatives | 423 | 20 | — | — | — | — | (5 | ) | — | — | 438 | 20 | ||||||||||||||||||||||||||||||||
Indexed universal life embedded derivatives | 13 | 1 | — | — | — | 1 | — | — | — | 15 | 1 | |||||||||||||||||||||||||||||||||
Total policyholder account balances | 731 | 45 | — | — | — | 7 | (5 | ) | — | — | 778 | 45 | ||||||||||||||||||||||||||||||||
Total Level 3 liabilities | $ | 731 | $ | 45 | $ | — | $ | — | $ | — | $ | 7 | $ | (5 | ) | $ | — | $ | — | $ | 778 | $ | 45 | |||||||||||||||||||||
(1) | Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
Total (gains) | |||||||||||||||||||||||||||||||||||||||||||||
Total realized and | losses | ||||||||||||||||||||||||||||||||||||||||||||
Beginning | unrealized (gains) | Ending | included in | ||||||||||||||||||||||||||||||||||||||||||
balance | losses | balance | net (income) | ||||||||||||||||||||||||||||||||||||||||||
as of | Included in | Transfer | Transfer | as of | attributable | ||||||||||||||||||||||||||||||||||||||||
January 1, | net | Included | into | out of | June 30, | to liabilities | |||||||||||||||||||||||||||||||||||||||
(Amounts in millions) | 2019 | (income) | in OCI | Purchases | Sales | Issuances | Settlements | Level 3 | Level 3 | 2019 | still held | ||||||||||||||||||||||||||||||||||
Policyholder account balances: | |||||||||||||||||||||||||||||||||||||||||||||
GMWB embeddedderivatives (1) | $ | 337 | $ | (24 | ) | $ | — | $ | — | $ | — | $ | 12 | $ | — | $ | — | $ | — | $ | 325 | $ | (20 | ) | |||||||||||||||||||||
Fixed index annuity embedded derivatives | 389 | 58 | — | — | — | — | (9 | ) | — | — | 438 | 58 | |||||||||||||||||||||||||||||||||
Indexed universal lifeembedded derivatives | 12 | — | — | — | — | 3 | — | — | — | 15 | — | ||||||||||||||||||||||||||||||||||
Total policyholder accountbalances | 738 | 34 | — | — | — | 15 | (9 | ) | — | — | 778 | 38 | |||||||||||||||||||||||||||||||||
Total Level 3 liabilities | $ | 738 | $ | 34 | $ | — | $ | — | $ | — | $ | 15 | $ | (9 | ) | $ | — | $ | — | $ | 778 | $ | 38 | ||||||||||||||||||||||
(Amounts in millions) | Beginning balance as of January 1, 2020 | Total realized and unrealized (gains) losses | Purchases | Sales | Issuances | Settlements | Transfer into Level 3 | Transfer out of Level 3 | Ending balance as of June 30, 2020 | Total (gains) losses attributable to liabilities still held | ||||||||||||||||||||||||||||||||||||||
Included in net (income) loss | Included in OCI | Included in net (income) loss | Included in OCI | |||||||||||||||||||||||||||||||||||||||||||||
Policyholder account balances: | ||||||||||||||||||||||||||||||||||||||||||||||||
GMWB embedded derivatives (1) | $ | 323 | $ | 224 | $ | — | $ | — | $ | — | $ | 12 | $ | — | $ | — | $ | — | $ | 559 | $ | 231 | $ | — | ||||||||||||||||||||||||
Fixed index annuity embedded derivatives | 452 | 13 | — | — | — | — | (18 | ) | — | — | 447 | 13 | — | |||||||||||||||||||||||||||||||||||
Indexed universal life embedded derivatives | 19 | (7 | ) | — | — | — | 11 | — | — | — | 23 | (7 | ) | — | ||||||||||||||||||||||||||||||||||
Total policyholder account balances | 794 | 230 | — | — | — | 23 | (18 | ) | — | — | 1,029 | 237 | — | |||||||||||||||||||||||||||||||||||
Total Level 3 liabilities | $ | 794 | $ | 230 | $ | — | $ | — | $ | — | $ | 23 | $ | (18 | ) | $ | — | $ | — | $ | 1,029 | $ | 237 | $ | — | |||||||||||||||||||||||
(1) | Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
Total (gains) | |||||||||||||||||||||||||||||||||||||||||||||
Total realized and | losses | ||||||||||||||||||||||||||||||||||||||||||||
Beginning | unrealized (gains) | Ending | included in | ||||||||||||||||||||||||||||||||||||||||||
balance | losses | balance | net (income) | ||||||||||||||||||||||||||||||||||||||||||
as of | Included in | Transfer | Transfer | as of | attributable | ||||||||||||||||||||||||||||||||||||||||
January 1, | net | Included | into | out of | June 30, | to liabilities | |||||||||||||||||||||||||||||||||||||||
(Amounts in millions) | 2018 | (income) | in OCI | Purchases | Sales | Issuances | Settlements | Level 3 | Level 3 | 2018 | still held | ||||||||||||||||||||||||||||||||||
Policyholder account balances: | |||||||||||||||||||||||||||||||||||||||||||||
GMWB embeddedderivatives (1) | $ | 250 | $ | (30 | ) | $ | — | $ | — | $ | — | $ | 15 | $ | — | $ | — | $ | — | $ | 235 | $ | (26 | ) | |||||||||||||||||||||
Fixed index annuityembedded derivatives | 419 | 7 | — | — | — | — | (6 | ) | — | — | 420 | 7 | |||||||||||||||||||||||||||||||||
Indexed universal lifeembedded derivatives | 14 | (7 | ) | — | — | — | 6 | — | — | — | 13 | (7 | ) | ||||||||||||||||||||||||||||||||
Total policyholder accountbalances | 683 | (30 | ) | — | — | — | 21 | (6 | ) | — | — | 668 | (26 | ) | |||||||||||||||||||||||||||||||
Total Level 3 liabilities | $ | 683 | $ | (30 | ) | $ | — | $ | — | $ | — | $ | 21 | $ (6 | ) | $ | — | $ | — | $ | 668 | $ | (26 | ) | |||||||||||||||||||||
Beginning balance as of January 1, 2019 | Total realized and unrealized (gains) losses | Purchases | Sales | Issuances | Settlements | Transfer into Level 3 | Transfer out of Level 3 | Ending balance as of June 30, 2019 | Total (gains) losses included in net (income) loss attributable to still | |||||||||||||||||||||||||||||||||||
(Amounts in millions) | Included loss | Included in OCI | ||||||||||||||||||||||||||||||||||||||||||
Policyholder account balances: | ||||||||||||||||||||||||||||||||||||||||||||
GMWB embedded derivatives (1) | $ | 337 | $ | (24 | ) | $ | — | $ | — | $ | — | $ | 12 | $ | — | $ | — | $ | — | $ | 325 | $ | (20 | ) | ||||||||||||||||||||
Fixed index annuity embedded derivatives | 389 | 58 | — | — | — | — | (9 | ) | — | — | 438 | 58 | ||||||||||||||||||||||||||||||||
Indexed universal life embedded derivatives | 12 | — | — | — | — | 3 | — | — | — | 15 | — | |||||||||||||||||||||||||||||||||
Total policyholder account balances | 738 | 34 | — | — | — | 15 | (9 | ) | — | — | 778 | 38 | ||||||||||||||||||||||||||||||||
Total Level 3 liabilities | $ | 738 | $ | 34 | $ | — | $ | — | $ | — | $ | 15 | $ | (9 | ) | $ | — | $ | — | $ | 778 | $ | 38 | |||||||||||||||||||||
(1) | Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Total realized and unrealized (gains) losses included in net (income): | ||||||||||||||||
Net investment income | $ | — | $ | — | $ | — | $ | — | ||||||||
Net investment (gains) losses | 45 | (1 | ) | 34 | (30 | ) | ||||||||||
Total | $ | 45 | $ | (1 | ) | $ | 34 | $ | (30 | ) | ||||||
Total (gains) losses included in net (income) attributable to liabilities still held: | ||||||||||||||||
Net investment income | $ | — | $ | — | $ | — | $ | — | ||||||||
Net investment (gains) losses | 45 | (1 | ) | 38 | (26 | ) | ||||||||||
Total | $ | 45 | $ | (1 | ) | $ | 38 | $ | (26 | ) |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Total realized and unrealized (gains) losses included in net (income) loss: | ||||||||||||||||
Net investment income | $ | — | $ | — | $ | — | $ | — | ||||||||
Net investment (gains) losses | (96 | ) | 45 | 230 | 34 | |||||||||||
Total | $ | (96 | ) | $ | 45 | $ | 230 | $ | 34 | |||||||
Total (gains) losses included in net (income) loss attributable to liabilities still held: | ||||||||||||||||
Net investment income | $ | — | $ | — | $ | — | $ | — | ||||||||
Net investment (gains) losses | (95 | ) | 45 | 237 | 38 | |||||||||||
Total | $ | (95 | ) | $ | 45 | $ | 237 | $ | 38 | |||||||
(Amounts in millions) | Valuation technique | Fair value | Unobservable input | Range | Weighted-average | |||||||||||
Policyholder account balances: | ||||||||||||||||
Withdrawal utilization rate | 45 % -88 % | 70 | % | |||||||||||||
Lapse rate | 2 % -9 % | 3 | % | |||||||||||||
Non-performance risk(credit spreads) | 18 bps - 83 bps | 66 bps | ||||||||||||||
GMWB embeddedderivatives (1) | Stochastic cash flow model | $ | 325 | Equity index volatility | 13 23 | 20 | % | |||||||||
Fixed index annuity embeddedderivatives | Option budget method | $ | 438 | Expected future interest credited | – 3 | 1 | % | |||||||||
Indexed universal life embeddedderivatives | Option budget method | $ | 15 | Expected future interest credited | 3 8 % | 5 | % | |||||||||
(Amounts in millions) | Valuation technique | Fair value | Unobservable input | Range | Weighted-average (1) | |||||||||||||
Policyholder account balances: | Withdrawal utilization rate | 56% - 88% | 73 | % | ||||||||||||||
Lapse rate | 2% - 9% | 3 | % | |||||||||||||||
Non-performance risk | ||||||||||||||||||
(credit spreads) | 9bps - 83bps | 67 | bps | |||||||||||||||
GMWB embedded derivatives (2) | Stochastic cash flow model | $ | 559 | Equity index volatility | 21% - 30% | 24 | % | |||||||||||
Fixed index annuity embedded derivatives | Option budget method | $ | 447 | Expected future interest credited | — % - 3% | 1 | % | |||||||||||
Indexed universal life embedded derivatives | Option budget method | $ | 23 | Expected future interest credited | 3% - 11% | 6 | % |
(1) |
(2) | Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. The unobservable inputs associated with GMWB embedded derivatives are not interrelated and therefore, a directional change in one input will not affect the other inputs. |
June 30, 2020 | ||||||||||||||||||||||||
Notional amount | Carrying amount | Fair value | ||||||||||||||||||||||
(Amounts in millions) | Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Commercial mortgage loans | (1) | $ | 6,917 | $ | 7,225 | $ | — | $ | — | $ | 7,225 | |||||||||||||
Other invested assets | (1) | 418 | 421 | — | 22 | 399 | ||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||
Long-term borrowings | (1) | 2,817 | 2,153 | — | 2,016 | 137 | ||||||||||||||||||
Investment contracts | (1) | 11,258 | 12,227 | — | — | 12,227 | ||||||||||||||||||
Other firm commitments: | ||||||||||||||||||||||||
Commitments to fund limited partnerships | 1,135 | — | — | — | — | — | ||||||||||||||||||
Commitments to fund bank loan investments | 35 | — | — | — | — | — | ||||||||||||||||||
Ordinary course of business lending commitments | 116 | — | — | — | — | — |
(1) | These financial instruments do not have notional amounts. |
December 31, 2019 | ||||||||||||||||||||||||
Notional amount | Carrying amount | Fair value | ||||||||||||||||||||||
(Amounts in millions) | Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Commercial mortgage loans | (1) | $ | 6,963 | $ | 7,239 | $ | — | $ | — | $ | 7,239 | |||||||||||||
Other invested assets | (1) | 432 | 432 | — | 49 | 383 | ||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||
Long-term borrowings | (1) | 3,277 | 3,093 | — | 2,951 | 142 | ||||||||||||||||||
Non-recourse funding obligations | (1) | 311 | 207 | — | — | 207 | ||||||||||||||||||
Investment contracts | (1) | 11,466 | 12,086 | — | — | 12,086 | ||||||||||||||||||
Other firm commitments: | ||||||||||||||||||||||||
Commitments to fund limited partnerships | 976 | — | — | — | — | — | ||||||||||||||||||
Commitments to fund bank loan investments | 52 | — | — | — | — | — | ||||||||||||||||||
Ordinary course of business lending commitments | 69 | — | — | — | — | — |
(1) | These financial instruments do not have notional amounts. |
As of or for the six | ||||||||
months ended | ||||||||
June 30, | ||||||||
(Amounts in millions) | 2019 | 2018 | ||||||
Beginning balance | $ | 10,379 | $ | 9,594 | ||||
Less reinsurance recoverables | (2,379 | ) | (2,419 | ) | ||||
Net beginning balance | 8,000 | 7,175 | ||||||
Incurred related to insured events of: | ||||||||
Current year | 2,009 | 1,946 | ||||||
Prior years | (214 | ) | (244 | ) | ||||
Total incurred | 1,795 | 1,702 | ||||||
Paid related to insured events of: | ||||||||
Current year | (410 | ) | (434 | ) | ||||
Prior years | (1,287 | ) | (1,266 | ) | ||||
Total paid | (1,697 | ) | (1,700 | ) | ||||
Interest on liability for policy and contract claims | 188 | 163 | ||||||
Foreign currency translation | 3 | (16 | ) | |||||
Net ending balance | 8,289 | 7,324 | ||||||
Add reinsurance recoverables | 2,388 | 2,341 | ||||||
Ending balance | $ | 10,677 | $ | 9,665 | ||||
As of or for the six months ended June 30, | ||||||||
(Amounts in millions) | 2020 | 2019 | ||||||
Beginning balance | $ | 10,958 | $ | 10,295 | ||||
Less reinsurance recoverables | (2,406 | ) | (2,379 | ) | ||||
Net beginning balance | 8,552 | 7,916 | ||||||
Incurred related to insured events of: | ||||||||
Current year | 2,238 | 1,961 | ||||||
Prior years | (255 | ) | (206 | ) | ||||
Total incurred | 1,983 | 1,755 | ||||||
Paid related to insured events of: | ||||||||
Current year | (436 | ) | (407 | ) | ||||
Prior years | (1,339 | ) | (1,253 | ) | ||||
Total paid | (1,775 | ) | (1,660 | ) | ||||
Interest on liability for policy and contract claims | 205 | 188 | ||||||
Foreign currency translation | (4 | ) | (1 | ) | ||||
Net ending balance | 8,961 | 8,198 | ||||||
Add reinsurance recoverables | 2,319 | 2,388 | ||||||
Ending balance | $ | 11,280 | $ | 10,586 | ||||
Three months ended June 30, | Six months ended June 30, | |||||||
(Amounts in millions) | 2020 | 2020 | ||||||
Allowance for credit losses: | ||||||||
Beginning balance | $ | 42 | $ | — | ||||
Cumulative effect of change in accounting | — | 40 | ||||||
Provision | 2 | 4 | ||||||
Write-offs | — | — | ||||||
Recoveries | — | — | ||||||
Ending balance | $ | 44 | $ | 44 | ||||
(Amounts in millions) | Collateralized | Non-collateralized | Total | |||||||||
Credit rating: | ||||||||||||
A++ | $ | — | $ | 508 | $ | 508 | ||||||
A+ | 1,267 | 1,467 | 2,734 | |||||||||
A | 20 | 58 | 78 | |||||||||
B+ | — | 2 | 2 | |||||||||
Not rated | 13,542 | 80 | 13,622 | |||||||||
Total reinsurance recoverable | $ | 14,829 | $ | 2,115 | $ | 16,944 | ||||||
June 30, | December 31, | |||||||
(Amounts in millions) | 2019 | 2018 | ||||||
Genworth Holdings (1) | ||||||||
Floating Rate Senior Secured Term Loan Facility, due 2023 | $ | 444 | $ | 445 | ||||
7.70% Senior Notes, due 2020 | 397 | 397 | ||||||
7.20% Senior Notes, due 2021 | 381 | 381 | ||||||
7.625% Senior Notes, due 2021 | 703 | 703 | ||||||
4.90% Senior Notes, due 2023 | 399 | 399 | ||||||
4.80% Senior Notes, due 2024 | 400 | 400 | ||||||
6.50% Senior Notes, due 2034 | 297 | 297 | ||||||
Floating Rate Junior Subordinated Notes, due 2066 | 598 | 598 | ||||||
Subtotal | 3,619 | 3,620 | ||||||
Bond consent fees | (29 | ) | (32 | ) | ||||
Deferred borrowing charges | (19 | ) | (21 | ) | ||||
Total Genworth Holdings | 3,571 | 3,567 | ||||||
Canada (2) | ||||||||
5.68% Senior Notes, due 2020 | 134 | 202 | ||||||
4.24% Senior Notes, due 2024 | 201 | 117 | ||||||
Subtotal | 335 | 319 | ||||||
Deferred borrowing charges | (2 | ) | (1 | ) | ||||
Total Canada | 333 | 318 | ||||||
Australia (3) | ||||||||
Floating Rate Junior Subordinated Notes, due 2025 | 141 | 141 | ||||||
Deferred borrowing charges | (1 | ) | (1 | ) | ||||
Total Australia | 140 | 140 | ||||||
Total | $ | 4,044 | $ | 4,025 | ||||
(Amounts in millions) | June 30, 2020 | December 31, 2019 | ||||||
Genworth Holdings (1) | ||||||||
7.70% Senior Notes, due 2020 | $ | — | $ | 397 | ||||
7.20% Senior Notes, due 2021 | 356 | 382 | ||||||
7.625% Senior Notes, due 2021 | 661 | 701 | ||||||
4.90% Senior Notes, due 2023 | 399 | 399 | ||||||
4.80% Senior Notes, due 2024 | 400 | 400 | ||||||
6.50% Senior Notes, due 2034 | 297 | 297 | ||||||
Floating Rate Junior Subordinated Notes, due 2066 | 598 | 598 | ||||||
Subtotal | 2,711 | 3,174 | ||||||
Bond consent fees | (22 | ) | (25 | ) | ||||
Deferred borrowing charges | (10 | ) | (12 | ) | ||||
Total Genworth Holdings | 2,679 | 3,137 | ||||||
Australia (2) | ||||||||
Floating Rate Junior Subordinated Notes, due 2025 | 138 | 140 | ||||||
Total Australia | 138 | 140 | ||||||
Total | $ | 2,817 | $ | 3,277 | ||||
(1) | We have the option to redeem all or a portion of the senior notes at any time with notice to the noteholders at a price equal to the greater of 100% of principal or the sum of the present value of the remaining scheduled payments of principal and interest discounted at the then-current treasury rate plus an applicable spread. |
(2) |
Subordinated floating rate notes issued by Genworth Financial Mortgage Insurance Pty Limited (“GFMIPL”), our indirect |
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Statutory U.S. federal income tax rate | 21.0 | % | 21.0 | % | 21.0 | % | 21.0 | % | ||||||||
Increase (reduction) in rate resulting from: | ||||||||||||||||
Effect of foreign operations | 5.0 | 3.4 | 5.2 | 3.2 | ||||||||||||
U.S. shareholder tax on foreign operations | 4.4 | — | 4.6 | — | ||||||||||||
Swaps terminated prior to the TCJA | 2.1 | 3.9 | 2.4 | 3.2 | ||||||||||||
TCJA, impact from change in tax rate | — | 5.4 | — | 3.3 | ||||||||||||
Valuation allowance | — | (2.0 | ) | — | (1.3 | ) | ||||||||||
Provision to return adjustments | — | (1.6 | ) | — | (0.7 | ) | ||||||||||
Other, net | 0.4 | 0.7 | (0.4 | ) | 0.9 | |||||||||||
Effective rate | 32.9 | % | 30.8 | % | 32.8 | % | 29.6 | % | ||||||||
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Statutory U.S. federal income tax rate | 21.0 | % | 21.0 | % | 21.0 | % | 21.0 | % | ||||||||
Increase (reduction) in rate resulting from: | ||||||||||||||||
Swaps terminated prior to the TCJA | 4.8 | 3.2 | 19.1 | 3.9 | ||||||||||||
Effect of foreign operations | 3.7 | 2.3 | 7.3 | 2.7 | ||||||||||||
Non-deductible goodwill | 1.2 | — | 2.7 | — | ||||||||||||
Non-deductible expense | 0.7 | 0.6 | 2.8 | 0.7 | ||||||||||||
Tax favored investments | (0.8 | ) | (0.5 | ) | (3.2 | ) | (0.5 | ) | ||||||||
Stock-based compensation | 0.1 | 0.1 | 2.9 | — | ||||||||||||
Other, net | 0.4 | 2.8 | 1.9 | 1.5 | ||||||||||||
Effective rate | 31.1 | % | 29.5 | % | 54.5 | % | 29.3 | % |
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Revenues: | ||||||||||||||||
U.S. Mortgage Insurance segment | $ | 235 | $ | 208 | $ | 458 | $ | 408 | ||||||||
Canada Mortgage Insurance segment | 161 | 150 | 320 | 308 | ||||||||||||
Australia Mortgage Insurance segment | 96 | 136 | 206 | 243 | ||||||||||||
U.S. Life Insurance segment: | ||||||||||||||||
Long-term care insurance | 1,055 | 1,035 | 2,169 | 2,055 | ||||||||||||
Life insurance | 382 | 367 | 754 | 746 | ||||||||||||
Fixed annuities | 151 | 176 | 310 | 358 | ||||||||||||
U.S. Life Insurance segment | 1,588 | 1,578 | 3,233 | 3,159 | ||||||||||||
Runoff segment | 78 | 80 | 160 | 148 | ||||||||||||
Corporate and Other activities | (2 | ) | 7 | (17 | ) | 8 | ||||||||||
Total revenues | $ | 2,156 | $ | 2,159 | $ | 4,360 | $ | 4,274 | ||||||||
Three June 30, | Six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | ||||||||||||||
Revenues: | ||||||||||||||||
U.S. Mortgage Insurance segment | $ | 274 | $ | 235 | $ | 535 | $ | 458 | ||||||||
Australia Mortgage Insurance segment | 136 | 96 | 163 | 206 | ||||||||||||
U.S. Life Insurance segment: | ||||||||||||||||
Long-term care insurance | 1,200 | 1,055 | 2,206 | 2,169 | ||||||||||||
Life insurance | 335 | 382 | 683 | 754 | ||||||||||||
Fixed annuities | 129 | 151 | 262 | 310 | ||||||||||||
U.S. Life Insurance segment | 1,664 | 1,588 | 3,151 | 3,233 | ||||||||||||
Runoff segment | 90 | 78 | 97 | 160 | ||||||||||||
Corporate and Other activities | (26 | ) | (3 | ) | 29 | (19 | ) | |||||||||
Total revenues | $ | 2,138 | $ | 1,994 | $ | 3,975 | $ | 4,038 | ||||||||
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Net income | $ | 218 | $ | 249 | $ | 448 | $ | 414 | ||||||||
Less: net income attributable to noncontrolling interests | 50 | 59 | 106 | 112 | ||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | 168 | 190 | 342 | 302 | ||||||||||||
Adjustments to net income available to Genworth Financial, Inc.’scommon stockholders: | ||||||||||||||||
Net investment (gains) losses, net (1) | 43 | 12 | (28 | ) | 29 | |||||||||||
(Gains) losses on early extinguishment of debt, net (2) | 1 | — | 1 | — | ||||||||||||
Expenses related to restructuring | — | — | 4 | — | ||||||||||||
Taxes on adjustments | (8 | ) | (2 | ) | 6 | (6 | ) | |||||||||
Adjusted operating income available to Genworth Financial, Inc.’scommon stockholders | $ | 204 | $ | 200 | $ | 325 | $ | 325 | ||||||||
Three months June 30, | Six months June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (441 | ) | $ | 168 | $ | (507 | ) | $ | 342 | ||||||
Add: net income from continuing operations attributable to noncontrolling interests | 23 | 15 | 17 | 35 | ||||||||||||
Add: net income from discontinued operations attributable to noncontrolling interests | — | 35 | — | 71 | ||||||||||||
Net income (loss) | (418 | ) | 218 | (490 | ) | 448 | ||||||||||
Less: income (loss) from discontinued operations, net of taxes | (520 | ) | 60 | (520 | ) | 122 | ||||||||||
Income from continuing operations | 102 | 158 | 30 | 326 | ||||||||||||
Less: net income from continuing operations attributable to noncontrolling interests | 23 | 15 | 17 | 35 | ||||||||||||
Income from continuing operations available to Genworth Financial, Inc.’s common stockholders | 79 | 143 | 13 | 291 | ||||||||||||
Adjustments to income from continuing operations available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
Net investment (gains) losses, net (1) | (131 | ) | 43 | (16 | ) | (28 | ) | |||||||||
Goodwill impairment, net (2) | 3 | — | 3 | — | ||||||||||||
(Gains) losses on early extinguishment of debt | (3 | ) | — | 9 | — | |||||||||||
Expenses related to restructuring | 1 | — | 2 | 4 | ||||||||||||
Taxes on adjustments | 30 | (8 | ) | 1 | 6 | |||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (21 | ) | $ | 178 | $ | 12 | $ | 273 | |||||||
(1) | For the three months ended June 30, |
(2) | For the three and |
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
U.S. Mortgage Insurance segment | $ | 147 | $ | 137 | $ | 271 | $ | 248 | ||||||||
Canada Mortgage Insurance segment | 41 | 46 | 82 | 95 | ||||||||||||
Australia Mortgage Insurance segment | 13 | 22 | 27 | 41 | ||||||||||||
U.S. Life Insurance segment: | ||||||||||||||||
Long-term care insurance | 37 | 22 | 17 | (10 | ) | |||||||||||
Life insurance | 10 | 4 | 8 | 3 | ||||||||||||
Fixed annuities | 19 | 31 | 36 | 59 | ||||||||||||
U.S. Life Insurance segment | 66 | 57 | 61 | 52 | ||||||||||||
Runoff segment | 9 | 13 | 29 | 23 | ||||||||||||
Corporate and Other activities | (72 | ) | (75 | ) | (145 | ) | (134 | ) | ||||||||
Adjusted operating income available to Genworth Financial, Inc.’s common stockholders | $ | 204 | $ | 200 | $ | 325 | $ | 325 | ||||||||
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
U.S. Mortgage Insurance segment | $ | (3 | ) | $ | 147 | $ | 145 | $ | 271 | |||||||
Australia Mortgage Insurance segment | 1 | 13 | 10 | 27 | ||||||||||||
U.S. Life Insurance segment: | ||||||||||||||||
Long-term care insurance | 48 | 37 | 49 | 17 | ||||||||||||
Life insurance | (81 | ) | 10 | (158 | ) | 8 | ||||||||||
Fixed annuities | 28 | 19 | 34 | 36 | ||||||||||||
U.S. Life Insurance segment | (5 | ) | 66 | (75 | ) | 61 | ||||||||||
Runoff segment | 24 | 9 | 11 | 29 | ||||||||||||
Corporate and Other activities | (38 | ) | (57 | ) | (79 | ) | (115 | ) | ||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (21 | ) | $ | 178 | $ | 12 | $ | 273 | |||||||
(Amounts in millions) | June 30, 2020 | December 31, 2019 | ||||||
Assets: | ||||||||
U.S. Mortgage Insurance segment | $ | 4,944 | $ | 4,504 | ||||
Australia Mortgage Insurance segment | 2,439 | 2,406 | ||||||
U.S. Life Insurance segment | 83,829 | 81,640 | ||||||
Runoff segment | 9,783 | 9,953 | ||||||
Corporate and Other activities | 2,642 | 2,839 | ||||||
Total assets | $ | 103,637 | $ | 101,342 | ||||
(Amounts in millions) | June 30, 2019 | December 31, 2018 | ||||||
Assets: | ||||||||
U.S. Mortgage Insurance segment | $ | 3,977 | $ | 3,583 | ||||
Canada Mortgage Insurance segment | 5,272 | 5,038 | ||||||
Australia Mortgage Insurance segment | 2,524 | 2,534 | ||||||
U.S. Life Insurance segment | 81,002 | 79,799 | ||||||
Runoff segment | 10,018 | 9,963 | ||||||
Corporate and Other activities | 1,513 | 6 | ||||||
Total assets | $ | 104,306 | $ | 100,923 | ||||
(Amounts in millions) | Net unrealized investment gains (losses) (1) | Derivatives qualifying as hedges (2) | Foreign currency translation and other adjustments | Total | ||||||||||||
Balances as of April 1, 2019 | $ | 943 | $ | 1,850 | $ | (301 | ) | $ | 2,492 | |||||||
OCI before reclassifications | 375 | 157 | 43 | 575 | ||||||||||||
Amounts reclassified from (to) OCI | 1 | (24 | ) | — | (23 | ) | ||||||||||
Current period OCI | 376 | 133 | 43 | 552 | ||||||||||||
Balances as of June 30, 2019 before noncontrolling interests | 1,319 | 1,983 | (258 | ) | 3,044 | |||||||||||
Less: change in OCI attributable to noncontrolling interests | 14 | — | 17 | 31 | ||||||||||||
Balances as of June 30, 2019 | $ | 1,305 | $ | 1,983 | $ | (275 | ) | $ | 3,013 | |||||||
(Amounts in millions) | Net unrealized investment gains (losses) (1) | Derivatives qualifying hedges (2) | Foreign currency translation and other adjustments | Total | ||||||||||||
Balances as of April 1, 2020 | $ | 1,140 | $ | 2,755 | $ | (80 | ) | $ | 3,815 | |||||||
OCI before reclassifications | 762 | (48 | ) | 73 | 787 | |||||||||||
Amounts reclassified from (to) OCI | (88 | ) | (30 | ) | — | (118 | ) | |||||||||
Current period OCI | 674 | (78 | ) | 73 | 669 | |||||||||||
Balances as of June 30, 2020 before noncontrolling interests | 1,814 | 2,677 | (7 | ) | 4,484 | |||||||||||
Less: change in OCI attributable to noncontrolling interests | 3 | — | 34 | 37 | ||||||||||||
Balances as of June 30, 2020 | $ | 1,811 | $ | 2,677 | $ | (41 | ) | $ | 4,447 | |||||||
(1) | Net of adjustments to DAC, present value of future profits, sales inducements and benefit reserves. See note 4 for additional information. |
(2) | See note 5 for additional information. |
(Amounts in millions) | Net unrealized investment gains (losses) (1) | Derivatives qualifying as hedges (2) | Foreign currency translation and other adjustments | Total | ||||||||||||
Balances as of April 1, 2018 | $ | 917 | $ | 1,927 | $ | (217 | ) | $ | 2,627 | |||||||
OCI before reclassifications | (193 | ) | (39 | ) | (98 | ) | (330 | ) | ||||||||
Amounts reclassified from (to) OCI | 6 | (25 | ) | — | (19 | ) | ||||||||||
Current period OCI | (187 | ) | (64 | ) | (98 | ) | (349 | ) | ||||||||
Balances as of June 30, 2018 before noncontrolling interests | 730 | 1,863 | (315 | ) | 2,278 | |||||||||||
Less: change in OCI attributable to noncontrolling interests | (6 | ) | — | (43 | ) | (49 | ) | |||||||||
Balances as of June 30, 2018 | $ | 736 | $ | 1,863 | $ | (272 | ) | $ | 2,327 | |||||||
(Amounts in millions) | Net unrealized investment gains (losses) (1) | Derivatives qualifying hedges (2) | Foreign currency translation and other adjustments | Total | ||||||||||||
Balances as of April 1, 2019 | $ | 943 | $ | 1,850 | $ | (301 | ) | $ | 2,492 | |||||||
OCI before reclassifications | 375 | 157 | 43 | 575 | ||||||||||||
Amounts reclassified from (to) OCI | 1 | (24 | ) | — | (23 | ) | ||||||||||
Current period OCI | 376 | 133 | 43 | 552 | ||||||||||||
Balances as of June 30, 2019 before noncontrolling interests | 1,319 | 1,983 | (258 | ) | 3,044 | |||||||||||
Less: change in OCI attributable to noncontrolling interests | 14 | — | 17 | 31 | ||||||||||||
Balances as of June 30, 2019 | $ | 1,305 | $ | 1,983 | $ | (275 | ) | $ | 3,013 | |||||||
(1) | Net of adjustments to DAC, present value of future profits, sales inducements and benefit reserves. See note 4 for additional information. |
(2) | See note 5 for additional information. |
(Amounts in millions) | Net unrealized investment gains (losses) (1) | Derivatives qualifying hedges (2) | Foreign currency translation and other adjustments | Total | ||||||||||||
Balances as of January 1, 2020 | $ | 1,456 | $ | 2,002 | $ | (25 | ) | $ | 3,433 | |||||||
OCI before reclassifications | 448 | 735 | (25 | ) | 1,158 | |||||||||||
Amounts reclassified from (to) OCI | (94 | ) | (60 | ) | — | (154 | ) | |||||||||
Current period OCI | 354 | 675 | (25 | ) | 1,004 | |||||||||||
Balances as of June 30, 2020 before noncontrolling interests | 1,810 | 2,677 | (50 | ) | 4,437 | |||||||||||
Less: change in OCI attributable to noncontrolling interests | (1 | ) | — | (9 | ) | (10 | ) | |||||||||
Balances as of June 30, 2020 | $ | 1,811 | $ | 2,677 | $ | (41 | ) | $ | 4,447 | |||||||
(Amounts in millions) | Net unrealized investment gains (losses) (1) | Derivatives qualifying as hedges (2) | Foreign currency translation and other adjustments | Total | ||||||||||||
Balances as of January 1, 2019 | $ | 595 | $ | 1,781 | $ | (332 | ) | $ | 2,044 | |||||||
OCI before reclassifications | 802 | 254 | 97 | 1,153 | ||||||||||||
Amounts reclassified from (to) OCI | (46 | ) | (52 | ) | — | (98 | ) | |||||||||
Current period OCI | 756 | 202 | 97 | 1,055 | ||||||||||||
Balances as of June 30, 2019 before noncontrolling interests | 1,351 | 1,983 | (235 | ) | 3,099 | |||||||||||
Less: change in OCI attributable to noncontrolling interests | 46 | — | 40 | 86 | ||||||||||||
Balances as of June 30, 2019 | $ | 1,305 | $ | 1,983 | $ | (275 | ) | $ | 3,013 | |||||||
(1) | Net of adjustments to DAC, present value of future profits, sales inducements and benefit reserves. See note 4 for additional information. |
(2) | See note 5 for additional information. |
(Amounts in millions) | Net unrealized investment gains (losses) (1) | Derivatives qualifying as hedges (2) | Foreign currency translation and other adjustments | Total | ||||||||||||
Balances as of January 1, 2018 | $ | 1,085 | $ | 2,065 | $ | (123 | ) | $ | 3,027 | |||||||
Cumulative effect of changes in accounting | 164 | 14 | (47 | ) | 131 | |||||||||||
OCI before reclassifications | (541 | ) | (165 | ) | (185 | ) | (891 | ) | ||||||||
Amounts reclassified from (to) OCI | 13 | (51 | ) | — | (38 | ) | ||||||||||
Current period OCI | (528 | ) | (216 | ) | (185 | ) | (929 | ) | ||||||||
Balances as of June 30, 2018 before noncontrolling interests | 721 | 1,863 | (355 | ) | 2,229 | |||||||||||
Less: change in OCI attributable to noncontrolling interests | (15 | ) | — | (83 | ) | (98 | ) | |||||||||
Balances as of June 30, 2018 | $ | 736 | $ | 1,863 | $ | (272 | ) | $ | 2,327 | |||||||
(Amounts in millions) | Net unrealized investment gains (losses) (1) | Derivatives qualifying hedges (2) | Foreign currency translation and other adjustments | Total | ||||||||||||
Balances as of January 1, 2019 | $ | 595 | $ | 1,781 | $ | (332 | ) | $ | 2,044 | |||||||
OCI before reclassifications | 802 | 254 | 97 | 1,153 | ||||||||||||
Amounts reclassified from (to) OCI | (46 | ) | (52 | ) | — | (98 | ) | |||||||||
Current period OCI | 756 | 202 | 97 | 1,055 | ||||||||||||
Balances as of June 30, 2019 before noncontrolling interests | 1,351 | 1,983 | (235 | ) | 3,099 | |||||||||||
Less: change in OCI attributable to noncontrolling interests | 46 | — | 40 | 86 | ||||||||||||
Balances as of June 30, 2019 | $ | 1,305 | $ | 1,983 | $ | (275 | ) | $ | 3,013 | |||||||
(1) | Net of adjustments to DAC, present value of future profits, sales inducements and benefit reserves. See note 4 for additional information. |
(2) | See note 5 for additional information. |
Amount reclassified from accumulated other comprehensive income (loss) | Affected line item in the consolidated statements of income | ||||||||||||||||||
Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | |||||||||||||||
Net unrealized investment (gains) losses: | |||||||||||||||||||
Unrealized (gains) losses oninvestments (1) | $ | 2 | $ | 8 | $ | (58 | ) | $ | 16 | Net investment (gains) losses | |||||||||
(Provision) benefit for income taxes | (1 | ) | (2 | ) | 12 | (3 | ) | Provision for income taxes | |||||||||||
Total | $ | 1 | $ | 6 | $ | (46 | ) | $ | 13 | ||||||||||
Derivatives qualifying as hedges: | |||||||||||||||||||
Interest rate swaps hedging assets | $ | (42 | ) | $ | (39 | ) | $ | (80 | ) | $ | (74 | ) | Net investment income | ||||||
Interest rate swaps hedging assets | 4 | — | (2 | ) | (5 | ) | Net investment (gains) losses | ||||||||||||
Foreign currency swaps | 1 | — | 1 | — | Net investment income | ||||||||||||||
Benefit for income taxes | 13 | 14 | 29 | 28 | Provision for income taxes | ||||||||||||||
Total | $ | (24 | ) | $ | (25 | ) | $ | (52 | ) | $ | (51 | ) | |||||||
Amount reclassified from accumulated | ||||||||||||||||||
other comprehensive income (loss) | Affected line item in the consolidated statements of income | |||||||||||||||||
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||||
Net unrealized investment (gains) losses: | ||||||||||||||||||
Unrealized (gains) losses on investments (1) | $ | (112 | ) | $ | 2 | $ | (119 | ) | $ | (58 | ) | Net investment (gains) losses | ||||||
Income taxes | 24 | (1 | ) | 25 | 12 | Provision for income taxes | ||||||||||||
Total | $ | (88 | ) | $ | 1 | $ | (94 | ) | $ | (46 | ) | |||||||
Derivatives qualifying as hedges: | ||||||||||||||||||
Interest rate swaps hedging assets | $ | (46 | ) | $ | (42 | ) | $ | (89 | ) | $ | (80 | ) | Net investment income | |||||
Interest rate swaps hedging assets | — | 4 | (4 | ) | (2 | ) | Net investment (gains) losses | |||||||||||
Foreign currency swaps | — | 1 | — | 1 | Net investment income | |||||||||||||
Income taxes | 16 | 13 | 33 | 29 | Provision for income taxes | |||||||||||||
Total | $ | (30 | ) | $ | (24 | ) | $ | (60 | ) | $ | (52 | ) | ||||||
(1) | Amounts exclude adjustments to DAC, present value of future profits, sales inducements and benefit reserves. |
(Amounts in millions) | Three months June 30, 2019 | Six months June 30, | ||||||
Revenues: | ||||||||
Premiums | $ | 125 | $ | 251 | ||||
Net investment income | 36 | 71 | ||||||
Net investment gains (losses) | 1 | — | ||||||
Total revenues | 162 | 322 | ||||||
Benefits and expenses: | ||||||||
Benefits and other changes in policy reserves | 19 | 38 | ||||||
Acquisition and operating expenses, net of deferrals | 18 | 32 | ||||||
Amortization of deferred acquisition costs and intangibles | 11 | 21 | ||||||
Interest expense (1) | 13 | 25 | ||||||
Total benefits and expenses | 61 | 116 | ||||||
Income before income taxes (2) | 101 | 206 | ||||||
Provision for income taxes | 41 | 84 | ||||||
Income from discontinued operations, net of taxes | 60 | 122 | ||||||
Less: net income from discontinued operations attributable to noncontrolling interests | 35 | 71 | ||||||
Income from discontinued operations available to Genworth Financial, Inc.’s common stockholders | $ | 25 | $ | 51 | ||||
(1) | Interest on debt assumed by Brookfield and interest on debt that was repaid as a result of the sale of Genworth Canada was allocated and reported in discontinued operations. A senior secured term loan facility (“Term Loan”), owed by Genworth Holdings and secured by GFIH’s ownership interest in Genworth Canada’s outstanding common shares, was repaid in connection with the close of the Genworth Canada sale. Accordingly, interest expense related to the Term Loan of $8 million and $16 million for the three and six months ended June 30, 2019, respectively, was allocated and reported in discontinued operations. |
(2) | The three and six months ended June 30, 2019 includes pre-tax income from discontinued operations available to Genworth Financial, Inc.’s common stockholders of $55 million and $111 million, respectively. |
(Amounts in millions) | Parent Guarantor | Issuer | All Other Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Assets | ||||||||||||||||||||
Investments: | ||||||||||||||||||||
Fixed maturity securities available-for-sale, at fair value | $ | — | $ | — | $ | 63,974 | $ | (200 | ) | $ | 63,774 | |||||||||
Equity securities, at fair value | — | — | 644 | — | 644 | |||||||||||||||
Commercial mortgage loans ($56 are restricted related to a securitization entity) | — | — | 7,019 | — | 7,019 | |||||||||||||||
Policy loans | — | — | 2,076 | — | 2,076 | |||||||||||||||
Other invested assets | — | 49 | 1,493 | (7 | ) | 1,535 | ||||||||||||||
Investments in subsidiaries | 13,938 | 12,439 | — | (26,377 | ) | — | ||||||||||||||
Total investments | 13,938 | 12,488 | 75,206 | (26,584 | ) | 75,048 | ||||||||||||||
Cash, cash equivalents and restricted cash | — | 358 | 1,580 | — | 1,938 | |||||||||||||||
Accrued investment income | — | — | 630 | (4 | ) | 626 | ||||||||||||||
Deferred acquisition costs | — | — | 2,105 | — | 2,105 | |||||||||||||||
Intangible assets and goodwill | — | — | 244 | — | 244 | |||||||||||||||
Reinsurance recoverable | — | — | 17,211 | — | 17,211 | |||||||||||||||
Other assets | 5 | 55 | 505 | (1 | ) | 564 | ||||||||||||||
Intercompany notes receivable | — | 273 | — | (273 | ) | — | ||||||||||||||
Deferred tax assets | (35 | ) | 841 | (423 | ) | — | 383 | |||||||||||||
Separate account assets | — | — | 6,187 | — | 6,187 | |||||||||||||||
Total assets | $ | 13,908 | $ | 14,015 | $ | 103,245 | $ | (26,862 | ) | $ | 104,306 | |||||||||
Liabilities and equity | ||||||||||||||||||||
Liabilities: | ||||||||||||||||||||
Future policy benefits | $ | — | $ | — | $ | 39,583 | $ | — | $ | 39,583 | ||||||||||
Policyholder account balances | — | — | 22,673 | — | 22,673 | |||||||||||||||
Liability for policy and contract claims | — | — | 10,677 | — | 10,677 | |||||||||||||||
Unearned premiums | — | — | 3,488 | — | 3,488 | |||||||||||||||
Other liabilities | — | 47 | 1,689 | (13 | ) | 1,723 | ||||||||||||||
Intercompany notes payable | 151 | 200 | 122 | (473 | ) | — | ||||||||||||||
Non-recourse funding obligations | — | — | 311 | — | 311 | |||||||||||||||
Long-term borrowings | — | 3,571 | 473 | — | 4,044 | |||||||||||||||
Deferred tax liability | — | — | 28 | — | 28 | |||||||||||||||
Separate account liabilities | — | — | 6,187 | — | 6,187 | |||||||||||||||
Total liabilities | 151 | 3,818 | 85,231 | (486 | ) | 88,714 | ||||||||||||||
Equity: | ||||||||||||||||||||
Common stock | 1 | — | 3 | (3 | ) | 1 | ||||||||||||||
Additional paid-in capital | 11,983 | 9,094 | 18,428 | (27,522 | ) | 11,983 | ||||||||||||||
Accumulated other comprehensive income (loss) | 3,013 | 2,982 | 3,051 | (6,033 | ) | 3,013 | ||||||||||||||
Retained earnings | 1,460 | (1,879 | ) | (5,603 | ) | 7,482 | 1,460 | |||||||||||||
Treasury stock, at cost | (2,700 | ) | — | — | — | (2,700 | ) | |||||||||||||
Total Genworth Financial, Inc.’s stockholders’ equity | 13,757 | 10,197 | 15,879 | (26,076 | ) | 13,757 | ||||||||||||||
Noncontrolling interests | — | — | 2,135 | (300 | ) | 1,835 | ||||||||||||||
Total equity | 13,757 | 10,197 | 18,014 | (26,376 | ) | 15,592 | ||||||||||||||
Total liabilities and equity | $ | 13,908 | $ | 14,015 | $ | 103,245 | $ | (26,862 | ) | $ | 104,306 | |||||||||
• | the consummation of certain qualifying debt transactions in which total gross proceeds of at least $750 million are raised; |
• | the consummation of certain qualifying equity issuances or dispositions with respect to GMHI, or any of our subsidiaries, in which total net cash proceeds of at least $475 million are raised; |
• | certain dispositions of our U.S. mortgage insurance business; |
• | the consummation of the China Oceanwide merger and the funding of the contemplated capital investment plan; |
• | transactions involving a change of control of Genworth, other than the China Oceanwide transaction; and |
• | receipt of dividends and sale proceeds from certain Genworth subsidiaries above certain threshold amounts. |
(Amounts in millions) | Parent Guarantor | Issuer | All Other Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Assets | ||||||||||||||||||||
Investments: | ||||||||||||||||||||
Fixed maturity securities available-for-sale, at fair value | $ | — | $ | — | $ | 59,861 | $ | (200 | ) | $ | 59,661 | |||||||||
Equity securities, at fair value | — | — | 655 | — | 655 | |||||||||||||||
Commercial mortgage loans ($62 are restricted related to a securitization entity) | — | — | 6,749 | — | 6,749 | |||||||||||||||
Policy loans | — | — | 1,861 | — | 1,861 | |||||||||||||||
Other invested assets | — | 86 | 1,104 | (2 | ) | 1,188 | ||||||||||||||
Investments in subsidiaries | 12,570 | 11,462 | — | (24,032 | ) | — | ||||||||||||||
Total investments | 12,570 | 11,548 | 70,230 | (24,234 | ) | 70,114 | ||||||||||||||
Cash, cash equivalents and restricted cash | — | 429 | 1,748 | — | 2,177 | |||||||||||||||
Accrued investment income | — | — | 679 | (4 | ) | 675 | ||||||||||||||
Deferred acquisition costs | — | — | 3,263 | — | 3,263 | |||||||||||||||
Intangible assets and goodwill | — | — | 347 | — | 347 | |||||||||||||||
Reinsurance recoverable | — | — | 17,278 | — | 17,278 | |||||||||||||||
Other assets | 15 | 62 | 397 | — | 474 | |||||||||||||||
Intercompany notes receivable | — | 180 | 6 | (186 | ) | — | ||||||||||||||
Deferred tax assets | 14 | 907 | (185 | ) | — | 736 | ||||||||||||||
Separate account assets | — | — | 5,859 | — | 5,859 | |||||||||||||||
Total assets | $ | 12,599 | $ | 13,126 | $ | 99,622 | $ | (24,424 | ) | $ | 100,923 | |||||||||
Liabilities and equity | ||||||||||||||||||||
Liabilities: | ||||||||||||||||||||
Future policy benefits | $ | — | $ | — | $ | 37,940 | $ | — | $ | 37,940 | ||||||||||
Policyholder account balances | — | — | 22,968 | — | 22,968 | |||||||||||||||
Liability for policy and contract claims | — | — | 10,379 | — | 10,379 | |||||||||||||||
Unearned premiums | — | — | 3,546 | — | 3,546 | |||||||||||||||
Other liabilities | 27 | 97 | 1,565 | (7 | ) | 1,682 | ||||||||||||||
Intercompany notes payable | 122 | 207 | 57 | (386 | ) | — | ||||||||||||||
Non-recourse funding obligations | — | — | 311 | — | 311 | |||||||||||||||
Long-term borrowings | — | 3,567 | 458 | — | 4,025 | |||||||||||||||
Deferred tax liability | — | — | 24 | — | 24 | |||||||||||||||
Separate account liabilities | — | — | 5,859 | — | 5,859 | |||||||||||||||
Total liabilities | 149 | 3,871 | 83,107 | (393 | ) | 86,734 | ||||||||||||||
Equity: | ||||||||||||||||||||
Common stock | 1 | — | 3 | (3 | ) | 1 | ||||||||||||||
Additional paid-in capital | 11,987 | 9,095 | 18,425 | (27,520 | ) | 11,987 | ||||||||||||||
Accumulated other comprehensive income (loss) | 2,044 | 2,144 | 2,060 | (4,204 | ) | 2,044 | ||||||||||||||
Retained earnings | 1,118 | (1,984 | ) | (6,012 | ) | 7,996 | 1,118 | |||||||||||||
Treasury stock, at cost | (2,700 | ) | — | — | — | (2,700 | ) | |||||||||||||
Total Genworth Financial, Inc.’s stockholders’ equity | 12,450 | 9,255 | 14,476 | (23,731 | ) | 12,450 | ||||||||||||||
Noncontrolling interests | — | — | 2,039 | (300 | ) | 1,739 | ||||||||||||||
Total equity | 12,450 | 9,255 | 16,515 | (24,031 | ) | 14,189 | ||||||||||||||
Total liabilities and equity | $ | 12,599 | $ | 13,126 | $ | 99,622 | $ | (24,424 | ) | $ | 100,923 | |||||||||
Parent | All Other | |||||||||||||||||||
(Amounts in millions) | Guarantor | Issuer | Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Revenues: | ||||||||||||||||||||
Premiums | $ | — | $ | — | $ | 1,126 | $ | — | $ | 1,126 | ||||||||||
Net investment income | — | 1 | 854 | (3 | ) | 852 | ||||||||||||||
Net investment gains (losses) | — | (9 | ) | (36 | ) | — | (45 | ) | ||||||||||||
Policy fees and other income | — | 2 | 223 | (2 | ) | 223 | ||||||||||||||
Total revenues | — | (6 | ) | 2,167 | (5 | ) | 2,156 | |||||||||||||
Benefits and expenses: | ||||||||||||||||||||
Benefits and other changes in policy reserves | — | — | 1,270 | — | 1,270 | |||||||||||||||
Interest credited | — | — | 146 | — | 146 | |||||||||||||||
Acquisition and operating expenses, net of deferrals | 3 | — | 244 | — | 247 | |||||||||||||||
Amortization of deferred acquisition costs and intangibles | — | — | 95 | — | 95 | |||||||||||||||
Interest expense | 1 | 65 | 12 | (5 | ) | 73 | ||||||||||||||
Total benefits and expenses | 4 | 65 | 1,767 | (5 | ) | 1,831 | ||||||||||||||
Income (loss) before income taxes and equity in income of subsidiaries | (4 | ) | (71 | ) | 400 | — | 325 | |||||||||||||
Provision (benefit) for income taxes | 23 | (14 | ) | 98 | — | 107 | ||||||||||||||
Equity in income of subsidiaries | 195 | 93 | — | (288 | ) | — | ||||||||||||||
Net income | 168 | 36 | 302 | (288 | ) | 218 | ||||||||||||||
Less: net income attributable to noncontrolling interests | — | — | 50 | — | 50 | |||||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | $ | 168 | $ | 36 | $ | 252 | $ | (288 | ) | $ | 168 | |||||||||
Parent | All Other | |||||||||||||||||||
(Amounts in millions) | Guarantor | Issuer | Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Revenues: | ||||||||||||||||||||
Premiums | $ | — | $ | — | $ | 1,136 | $ | — | $ | 1,136 | ||||||||||
Net investment income | — | 4 | 828 | (4 | ) | 828 | ||||||||||||||
Net investment gains (losses) | — | (8 | ) | (6 | ) | — | (14 | ) | ||||||||||||
Policy fees and other income | — | 1 | 209 | (1 | ) | 209 | ||||||||||||||
Total revenues | — | (3 | ) | 2,167 | (5 | ) | 2,159 | |||||||||||||
Benefits and expenses: | ||||||||||||||||||||
Benefits and other changes in policy reserves | — | — | 1,205 | — | 1,205 | |||||||||||||||
Interest credited | — | — | 152 | — | 152 | |||||||||||||||
Acquisition and operating expenses, net of deferrals | 7 | — | 246 | — | 253 | |||||||||||||||
Amortization of deferred acquisition costs and intangibles | — | — | 112 | — | 112 | |||||||||||||||
Interest expense | 1 | 70 | 11 | (5 | ) | 77 | ||||||||||||||
Total benefits and expenses | 8 | 70 | 1,726 | (5 | ) | 1,799 | ||||||||||||||
Income (loss) before income taxes and equity in income of subsidiaries | (8 | ) | (73 | ) | 441 | — | 360 | |||||||||||||
Provision (benefit) for income taxes | 32 | (14 | ) | 93 | — | 111 | ||||||||||||||
Equity in income of subsidiaries | 230 | 151 | — | (381 | ) | — | ||||||||||||||
Net income | 190 | 92 | 348 | (381 | ) | 249 | ||||||||||||||
Less: net income attributable to noncontrolling interests | — | — | 59 | — | 59 | |||||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | $ | 190 | $ | 92 | $ | 289 | $ | (381 | ) | $ | 190 | |||||||||
Parent | All Other | |||||||||||||||||||
(Amounts in millions) | Guarantor | Issuer | Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Revenues: | ||||||||||||||||||||
Premiums | $ | — | $ | — | $ | 2,240 | $ | — | $ | 2,240 | ||||||||||
Net investment income | (1 | ) | 4 | 1,685 | (7 | ) | 1,681 | |||||||||||||
Net investment gains (losses) | — | (12 | ) | 41 | — | 29 | ||||||||||||||
Policy fees and other income | — | 2 | 411 | (3 | ) | 410 | ||||||||||||||
Total revenues | (1 | ) | (6 | ) | 4,377 | (10 | ) | 4,360 | ||||||||||||
Benefits and expenses: | ||||||||||||||||||||
Benefits and other changes in policy reserves | — | — | 2,571 | — | 2,571 | |||||||||||||||
Interest credited | — | — | 293 | — | 293 | |||||||||||||||
Acquisition and operating expenses, net of deferrals | 7 | (2 | ) | 493 | — | 498 | ||||||||||||||
Amortization of deferred acquisition costs and intangibles | — | — | 186 | — | 186 | |||||||||||||||
Interest expense | 3 | 130 | 22 | (10 | ) | 145 | ||||||||||||||
Total benefits and expenses | 10 | 128 | 3,565 | (10 | ) | 3,693 | ||||||||||||||
Income (loss) before income taxes and equity in income of subsidiaries | (11 | ) | (134 | ) | 812 | — | 667 | |||||||||||||
Provision (benefit) for income taxes | 44 | (26 | ) | 201 | — | 219 | ||||||||||||||
Equity in income of subsidiaries | 397 | 213 | — | (610 | ) | — | ||||||||||||||
Net income | 342 | 105 | 611 | (610 | ) | 448 | ||||||||||||||
Less: net income attributable to noncontrolling interests | — | — | 106 | — | 106 | |||||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | $ | 342 | $ | 105 | $ | 505 | $ | (610 | ) | $ | 342 | |||||||||
Parent | All Other | |||||||||||||||||||
(Amounts in millions) | Guarantor | Issuer | Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Revenues: | ||||||||||||||||||||
Premiums | $ | — | $ | — | $ | 2,276 | $ | — | $ | 2,276 | ||||||||||
Net investment income | (1 | ) | 7 | 1,633 | (7 | ) | 1,632 | |||||||||||||
Net investment gains (losses) | — | (2 | ) | (43 | ) | — | (45 | ) | ||||||||||||
Policy fees and other income | — | 1 | 412 | (2 | ) | 411 | ||||||||||||||
Total revenues | (1 | ) | 6 | 4,278 | (9 | ) | 4,274 | |||||||||||||
Benefits and expenses: | ||||||||||||||||||||
Benefits and other changes in policy reserves | — | — | 2,516 | — | 2,516 | |||||||||||||||
Interest credited | — | — | 308 | — | 308 | |||||||||||||||
Acquisition and operating expenses, net of deferrals | 14 | — | 479 | — | 493 | |||||||||||||||
Amortization of deferred acquisition costs and intangibles | — | — | 216 | — | 216 | |||||||||||||||
Interest expense | 1 | 138 | 23 | (9 | ) | 153 | ||||||||||||||
Total benefits and expenses | 15 | 138 | 3,542 | (9 | ) | 3,686 | ||||||||||||||
Income (loss) before income taxes and equity in income of subsidiaries | (16 | ) | (132 | ) | 736 | — | 588 | |||||||||||||
Provision (benefit) for income taxes | 38 | (31 | ) | 167 | — | 174 | ||||||||||||||
Equity in income of subsidiaries | 356 | 196 | — | (552 | ) | — | ||||||||||||||
Net income | 302 | 95 | 569 | (552 | ) | 414 | ||||||||||||||
Less: net income attributable to noncontrolling interests | — | — | 112 | — | 112 | |||||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | $ | 302 | $ | 95 | $ | 457 | $ | (552 | ) | $ | 302 | |||||||||
Parent | All Other | |||||||||||||||||||
(Amounts in millions) | Guarantor | Issuer | Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Net income | $ | 168 | $ | 36 | $ | 302 | $ | (288 | ) | $ | 218 | |||||||||
Other comprehensive income (loss), net of taxes: | ||||||||||||||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired | 362 | 311 | 376 | (673 | ) | 376 | ||||||||||||||
Derivatives qualifying as hedges | 133 | 133 | 148 | (281 | ) | 133 | ||||||||||||||
Foreign currency translation and other adjustments | 26 | 17 | 43 | (43 | ) | 43 | ||||||||||||||
Total other comprehensive income (loss) | 521 | 461 | 567 | (997 | ) | 552 | ||||||||||||||
Total comprehensive income | 689 | 497 | 869 | (1,285 | ) | 770 | ||||||||||||||
Less: comprehensive income attributable to noncontrolling interests | — | — | 81 | — | 81 | |||||||||||||||
Total comprehensive income available to Genworth Financial, Inc.’s common stockholders | $ | 689 | $ | 497 | $ | 788 | $ | (1,285 | ) | $ | 689 | |||||||||
Parent | All Other | |||||||||||||||||||
(Amounts in millions) | Guarantor | Issuer | Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Net income | $ | 190 | $ | 92 | $ | 348 | $ | (381 | ) | $ | 249 | |||||||||
Other comprehensive income (loss), net of taxes: | ||||||||||||||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired | (179 | ) | (167 | ) | (185 | ) | 346 | (185 | ) | |||||||||||
Net unrealized gains (losses) on other-than-temporarily impaired securities | (2 | ) | (1 | ) | (2 | ) | 3 | (2 | ) | |||||||||||
Derivatives qualifying as hedges | (64 | ) | (64 | ) | (68 | ) | 132 | (64 | ) | |||||||||||
Foreign currency translation and other adjustments | (55 | ) | (46 | ) | (97 | ) | 100 | (98 | ) | |||||||||||
Total other comprehensive income (loss) | (300 | ) | (278 | ) | (352 | ) | 581 | (349 | ) | |||||||||||
Total comprehensive loss | (110 | ) | (186 | ) | (4 | ) | 200 | (100 | ) | |||||||||||
Less: comprehensive income attributable to noncontrolling interests | — | — | 10 | — | 10 | |||||||||||||||
Total comprehensive loss available to Genworth Financial, Inc.’s common stockholders | $ | (110 | ) | $ | (186 | ) | $ | (14 | ) | $ | 200 | $ | (110 | ) | ||||||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Parent | All Other | |||||||||||||||||||
(Amounts in millions) | Guarantor | Issuer | Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Net income | $ | 342 | $ | 105 | $ | 611 | $ | (610 | ) | $ | 448 | |||||||||
Other comprehensive income (loss), net of taxes: | ||||||||||||||||||||
Net unrealized gains (losses) on securities not other-than- temporarily impaired | 709 | 594 | 755 | (1,303 | ) | 755 | ||||||||||||||
Net unrealized gains (losses) on other-than-temporarily impaired securities | 1 | 1 | 1 | (2 | ) | 1 | ||||||||||||||
Derivatives qualifying as hedges | 202 | 202 | 225 | (427 | ) | 202 | ||||||||||||||
Foreign currency translation and other adjustments | 57 | 41 | 96 | (97 | ) | 97 | ||||||||||||||
Total other comprehensive income (loss) | 969 | 838 | 1,077 | (1,829 | ) | 1,055 | ||||||||||||||
Total comprehensive income | 1,311 | 943 | 1,688 | (2,439 | ) | 1,503 | ||||||||||||||
Less: comprehensive income attributable to noncontrolling interests | — | — | 192 | — | 192 | |||||||||||||||
Total comprehensive income available to Genworth Financial, Inc.’s common stockholders | $ | 1,311 | $ | 943 | $ | 1,496 | $ | (2,439 | ) | $ | 1,311 | |||||||||
Parent | All Other | |||||||||||||||||||
(Amounts in millions) | Guarantor | Issuer | Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Net income | $ | 302 | $ | 95 | $ | 569 | $ | (552 | ) | $ | 414 | |||||||||
Other comprehensive income (loss), net of taxes: | ||||||||||||||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired | (511 | ) | (462 | ) | (526 | ) | 973 | (526 | ) | |||||||||||
Net unrealized gains (losses) on other-than-temporarily impaired securities | (2 | ) | (1 | ) | (2 | ) | 3 | (2 | ) | |||||||||||
Derivatives qualifying as hedges | (216 | ) | (217 | ) | (233 | ) | 450 | (216 | ) | |||||||||||
Foreign currency translation and other adjustments | (102 | ) | (82 | ) | (185 | ) | 184 | (185 | ) | |||||||||||
Total other comprehensive income (loss) | (831 | ) | (762 | ) | (946 | ) | 1,610 | (929 | ) | |||||||||||
Total comprehensive loss | (529 | ) | (667 | ) | (377 | ) | 1,058 | (515 | ) | |||||||||||
Less: comprehensive income attributable to noncontrolling interests | — | — | 14 | — | 14 | |||||||||||||||
Total comprehensive loss available to Genworth Financial, Inc.’s common stockholders | $ | (529 | ) | $ | (667 | ) | $ | (391 | ) | $ | 1,058 | $ | (529 | ) | ||||||
Parent | All Other | |||||||||||||||||||
(Amounts in millions) | Guarantor | Issuer | Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Cash flows from (used by) operating activities: | ||||||||||||||||||||
Net income | $ | 342 | $ | 105 | $ | 611 | $ | (610 | ) | $ | 448 | |||||||||
Adjustments to reconcile net income to net cash from (used by) operating activities: | ||||||||||||||||||||
Equity in income from subsidiaries | (397 | ) | (213 | ) | — | 610 | — | |||||||||||||
Dividends from subsidiaries | — | 105 | (105 | ) | — | — | ||||||||||||||
Amortization of fixed maturity securities discounts and premiums | — | 3 | (57 | ) | — | (54 | ) | |||||||||||||
Net investment (gains) losses | — | 12 | (41 | ) | — | (29 | ) | |||||||||||||
Charges assessed to policyholders | — | — | (364 | ) | — | (364 | ) | |||||||||||||
Acquisition costs deferred | — | — | (35 | ) | — | (35 | ) | |||||||||||||
Amortization of deferred acquisition costs and intangibles | — | — | 186 | — | 186 | |||||||||||||||
Deferred income taxes | 49 | 74 | 11 | — | 134 | |||||||||||||||
Derivative instruments and limited partnerships | — | (30 | ) | 52 | — | 22 | ||||||||||||||
Stock-based compensation expense | 10 | — | 2 | — | 12 | |||||||||||||||
Change in certain assets and liabilities: | ||||||||||||||||||||
Accrued investment income and other assets | (1 | ) | — | (290 | ) | 1 | (290 | ) | ||||||||||||
Insurance reserves | — | — | 609 | — | 609 | |||||||||||||||
Current tax liabilities | (4 | ) | (40 | ) | 71 | — | 27 | |||||||||||||
Other liabilities, policy and contract claims and other policy-related balances | (18 | ) | (3 | ) | 156 | (6 | ) | 129 | ||||||||||||
Net cash from (used by) operating activities | (19 | ) | 13 | 806 | (5 | ) | 795 | |||||||||||||
Cash flows used by investing activities: | ||||||||||||||||||||
Proceeds from maturities and repayments of investments: | ||||||||||||||||||||
Fixed maturity securities | — | — | 1,929 | — | 1,929 | |||||||||||||||
Commercial mortgage loans | — | — | 285 | — | 285 | |||||||||||||||
Restricted commercial mortgage loans related to a securitization entity | — | — | 6 | — | 6 | |||||||||||||||
Proceeds from sales of investments: | ||||||||||||||||||||
Fixed maturity and equity securities | — | — | 2,859 | — | 2,859 | |||||||||||||||
Purchases and originations of investments: | ||||||||||||||||||||
Fixed maturity and equity securities | — | — | (4,681 | ) | — | (4,681 | ) | |||||||||||||
Commercial mortgage loans | — | — | (561 | ) | — | (561 | ) | |||||||||||||
Other invested assets, net | — | 29 | (261 | ) | 5 | (227 | ) | |||||||||||||
Policy loans, net | — | — | 39 | — | 39 | |||||||||||||||
Intercompany notes receivable | — | (93 | ) | 6 | 87 | — | ||||||||||||||
Capital contributions to subsidiaries | (3 | ) | — | 3 | — | — | ||||||||||||||
Net cash used by investing activities | (3 | ) | (64 | ) | (376 | ) | 92 | (351 | ) | |||||||||||
Cash flows from (used by) financing activities: | ||||||||||||||||||||
Deposits to universal life and investment contracts | — | — | 444 | — | 444 | |||||||||||||||
Withdrawals from universal life and investment contracts | — | — | (1,096 | ) | — | (1,096 | ) | |||||||||||||
Proceeds from the issuance of long-term debt | — | — | 77 | — | 77 | |||||||||||||||
Repayment and repurchase of long-term debt | — | (1 | ) | (77 | ) | — | (78 | ) | ||||||||||||
Repurchase of subsidiary shares | — | — | (44 | ) | — | (44 | ) | |||||||||||||
Dividends paid to noncontrolling interests | — | — | (53 | ) | — | (53 | ) | |||||||||||||
Intercompany notes payable | 29 | (7 | ) | 65 | (87 | ) | — | |||||||||||||
Other, net | (7 | ) | (12 | ) | 74 | — | 55 | |||||||||||||
Net cash from (used by) financing activities | 22 | (20 | ) | (610 | ) | (87 | ) | (695 | ) | |||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | — | — | 12 | — | 12 | |||||||||||||||
Net change in cash, cash equivalents and restricted cash | — | (71 | ) | (168 | ) | — | (239 | ) | ||||||||||||
Cash, cash equivalents and restricted cash at beginning of period | — | 429 | 1,748 | — | 2,177 | |||||||||||||||
Cash, cash equivalents and restricted cash at end of period | $ | — | $ | 358 | $ | 1,580 | $ | — | $ | 1,938 | ||||||||||
Parent | All Other | |||||||||||||||||||
(Amounts in millions) | Guarantor | Issuer | Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Cash flows from (used by) operating activities: | ||||||||||||||||||||
Net income | $ | 302 | $ | 95 | $ | 569 | $ | (552 | ) | $ | 414 | |||||||||
Adjustments to reconcile net income to net cash from (used by) operating activities: | ||||||||||||||||||||
Equity in income from subsidiaries | (356 | ) | (196 | ) | — | 552 | — | |||||||||||||
Dividends from subsidiaries | 50 | 91 | (141 | ) | — | — | ||||||||||||||
Amortization of fixed maturity securities discounts and premiums | — | 3 | (65 | ) | — | (62 | ) | |||||||||||||
Net investment losses | — | 2 | 43 | — | 45 | |||||||||||||||
Charges assessed to policyholders | — | — | (359 | ) | — | (359 | ) | |||||||||||||
Acquisition costs deferred | — | — | (40 | ) | — | (40 | ) | |||||||||||||
Amortization of deferred acquisition costs and intangibles | — | — | 216 | — | 216 | |||||||||||||||
Deferred income taxes | 42 | (117 | ) | 158 | — | 83 | ||||||||||||||
Derivative instruments and limited partnerships | — | 22 | (217 | ) | — | (195 | ) | |||||||||||||
Stock-based compensation expense | 15 | — | 1 | — | 16 | |||||||||||||||
Change in certain assets and liabilities: | ||||||||||||||||||||
Accrued investment income and other assets | (1 | ) | 59 | (147 | ) | — | (89 | ) | ||||||||||||
Insurance reserves | — | — | 691 | — | 691 | |||||||||||||||
Current tax liabilities | (27 | ) | 87 | (97 | ) | — | (37 | ) | ||||||||||||
Other liabilities, policy and contract claims and other policy-related balances | (15 | ) | (50 | ) | (49 | ) | (8 | ) | (122 | ) | ||||||||||
Net cash from (used by) operating activities | 10 | (4 | ) | 563 | (8 | ) | 561 | |||||||||||||
Cash flows used by investing activities: | ||||||||||||||||||||
Proceeds from maturities and repayments of investments: | ||||||||||||||||||||
Fixed maturity securities | — | — | 1,979 | — | 1,979 | |||||||||||||||
Commercial mortgage loans | — | — | 350 | — | 350 | |||||||||||||||
Restricted commercial mortgage loans related to a securitization entity | — | — | 16 | — | 16 | |||||||||||||||
Proceeds from sales of investments: | ||||||||||||||||||||
Fixed maturity and equity securities | — | — | 1,920 | — | 1,920 | |||||||||||||||
Purchases and originations of investments: | ||||||||||||||||||||
Fixed maturity and equity securities | — | — | (4,082 | ) | — | (4,082 | ) | |||||||||||||
Commercial mortgage loans | — | — | (489 | ) | — | (489 | ) | |||||||||||||
Other invested assets, net | — | — | 85 | 8 | 93 | |||||||||||||||
Policy loans, net | — | — | 15 | — | 15 | |||||||||||||||
Intercompany notes receivable | — | (10 | ) | 58 | (48 | ) | — | |||||||||||||
Capital contributions to subsidiaries | (1 | ) | — | 1 | — | — | ||||||||||||||
Net cash used by investing activities | (1 | ) | (10 | ) | (147 | ) | (40 | ) | (198 | ) | ||||||||||
Cash flows used by financing activities: | ||||||||||||||||||||
Deposits to universal life and investment contracts | — | — | 503 | — | 503 | |||||||||||||||
Withdrawals from universal life and investment contracts | — | — | (1,177 | ) | — | (1,177 | ) | |||||||||||||
Proceeds from the issuance of long-term debt | — | 441 | — | — | 441 | |||||||||||||||
Repayment and repurchase of long-term debt | — | (597 | ) | — | — | (597 | ) | |||||||||||||
Repayment of borrowings related to a securitization entity | — | — | (12 | ) | — | (12 | ) | |||||||||||||
Repurchase of subsidiary shares | — | — | (49 | ) | — | (49 | ) | |||||||||||||
Dividends paid to noncontrolling interests | — | — | (50 | ) | — | (50 | ) | |||||||||||||
Intercompany notes payable | (7 | ) | (59 | ) | 18 | 48 | — | |||||||||||||
Other, net | (2 | ) | (19 | ) | 19 | — | (2 | ) | ||||||||||||
Net cash used by financing activities | (9 | ) | (234 | ) | (748 | ) | 48 | (943 | ) | |||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | — | — | (52 | ) | — | (52 | ) | |||||||||||||
Net change in cash, cash equivalents and restricted cash | — | (248 | ) | (384 | ) | — | (632 | ) | ||||||||||||
Cash, cash equivalents and restricted cash at beginning of period | — | 795 | 2,080 | — | 2,875 | |||||||||||||||
Cash, cash equivalents and restricted cash at end of period | $ | — | $ | 547 | $ | 1,696 | $ | — | $ | 2,243 | ||||||||||
delay the transaction, make it more costly or ultimately preclude it; the risk that the proposed China Oceanwide transaction disrupts our current plans and operations as a result of the announcement and consummation of the transaction; potential adverse reactions or changes to our business relationships with clients, employees, suppliers or other parties or other business uncertainties resulting from the announcement of the China Oceanwide transaction or during the pendency of the transaction, including but not limited to such changes that could affect our financial performance; certain restrictions during the pendency of the China Oceanwide transaction that may impact our ability to pursue certain business opportunities or strategic transactions; continued availability of capital and financing to us before, or in the absence of, the consummation of the |
business and profitability; deterioration in economic conditions or a decline in home prices that adversely affect our loss experience in mortgage insurance; political and economic instability or changes in government policies; and fluctuations in foreign currency exchange rates and international securities markets; |
overall mortality experience was also higher for the three months ended June 30, 2020 compared to three months ended June 30, 2019, attributable in part to COVID-19. |
to the efforts to contain the spread of COVID-19, including close inspection of investments in industries directly impacted, such as travel, energy, leisure, lodging and auto. Our monitoring also includes inspection of other credit risk attributes, such as high leverage, supply chain interruptions and service disruptions/stoppages. We recognized a $7 million credit loss on ouravailable-for-sale COVID-19. |
Given the options available, we believe our operating subsidiaries will be able to meet the near-term liquidity demands given the current market impacts from COVID-19. For additional details on our overall liquidity and future dividend sources, see “—Liquidity and Capital Resources.” |
June 30, 2020 and 2019, respectively. The increase was primarily due to an increase in claim and policy terminations driven mostly by higher mortality in the current year and from favorable development on prior year incurred but not reported claims. The increase was also attributable to higher premiums in the current year from in-force rate actions approved and implemented. These increases were partially offset by higher frequency and severity of new claims in the current year. |
assets of 143% of the required assets under PMIERs compared to 142% as of March 31, 2020. The estimated sufficiency as of June 30, 2020 was $1,275 million of available assets above the PMIERs requirements compared to $1,171 million as of March 31, 2020. The improvement in PMIERs sufficiency as compared to March 31, 2020 was driven in part by business cash flows increasing PMIERs available assets, elevated lapse of existing business driven by low prevailing interest rates and an increase in reinsurance credit. In addition, our second quarter of 2020 PMIERs required assets benefited from the application of a 0.30 multiplier applied to the risk-based required asset amount factor for certain non-performing loans. These factors were partially offset by incremental new delinquencies driving higher PMIERs required assets and capital consumed by new insurance written in the second quarter of 2020. See “Item 2—U.S. Mortgage Insurance segment—trends and conditions” for additional details. |
pre-tax gain of $3 million. In March 2020, Genworth Holdings also repurchased $14 million principal amount of its senior notes with 2021 maturity dates for apre-tax gain of $1 million. |
Three months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 1,126 | $ | 1,136 | $ | (10 | ) | (1 | )% | |||||||
Net investment income | 852 | 828 | 24 | 3 | % | |||||||||||
Net investment gains (losses) | (45 | ) | (14 | ) | (31 | ) | NM | (1) | ||||||||
Policy fees and other income | 223 | 209 | 14 | 7 | % | |||||||||||
Total revenues | 2,156 | 2,159 | (3 | ) | — | % | ||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 1,270 | 1,205 | 65 | 5 | % | |||||||||||
Interest credited | 146 | 152 | (6 | ) | (4 | )% | ||||||||||
Acquisition and operating expenses, net of deferrals | 247 | 253 | (6 | ) | (2 | )% | ||||||||||
Amortization of deferred acquisition costs and intangibles | 95 | 112 | (17 | ) | (15 | )% | ||||||||||
Interest expense | 73 | 77 | (4 | ) | (5 | )% | ||||||||||
Total benefits and expenses | 1,831 | 1,799 | 32 | 2 | % | |||||||||||
Income before income taxes | 325 | 360 | (35 | ) | (10 | )% | ||||||||||
Provision for income taxes | 107 | 111 | (4 | ) | (4 | )% | ||||||||||
Net income | 218 | 249 | (31 | ) | (12 | )% | ||||||||||
Less: net income attributable to noncontrolling interests | 50 | 59 | (9 | ) | (15 | )% | ||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | $ | 168 | $ | 190 | $ | (22 | ) | (12 | )% | |||||||
Three months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 1,019 | $ | 1,001 | $ | 18 | 2 | % | ||||||||
Net investment income | 786 | 816 | (30 | ) | (4 | )% | ||||||||||
Net investment gains (losses) | 159 | (46 | ) | 205 | NM | (1) | ||||||||||
Policy fees and other income | 174 | 223 | (49 | ) | (22 | )% | ||||||||||
Total revenues | 2,138 | 1,994 | 144 | 7 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 1,486 | 1,251 | 235 | 19 | % | |||||||||||
Interest credited | 139 | 146 | (7 | ) | (5 | )% | ||||||||||
Acquisition and operating expenses, net of deferrals | 223 | 229 | (6 | ) | (3 | )% | ||||||||||
Amortization of deferred acquisition costs and intangibles | 93 | 84 | 9 | 11 | % | |||||||||||
Goodwill impairment | 5 | — | 5 | NM | (1) | |||||||||||
Interest expense | 44 | 60 | (16 | ) | (27 | )% | ||||||||||
Total benefits and expenses | 1,990 | 1,770 | 220 | 12 | % | |||||||||||
Income from continuing operations before income taxes | 148 | 224 | (76 | ) | (34 | )% | ||||||||||
Provision for income taxes | 46 | 66 | (20 | ) | (30 | )% | ||||||||||
Income from continuing operations | 102 | 158 | (56 | ) | (35 | )% | ||||||||||
Income (loss) from discontinued operations, net of taxes | (520 | ) | 60 | (580 | ) | NM | (1) | |||||||||
Net income (loss) | (418 | ) | 218 | (636 | ) | NM | (1) | |||||||||
Less: net income from continuing operations attributable to noncontrolling interests | 23 | 15 | 8 | 53 | % | |||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests | — | 35 | (35 | ) | (100 | )% | ||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (441 | ) | $ | 168 | $ | (609 | ) | NM | (1) | ||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
Income from continuing operations available to Genworth Financial, Inc.’s common stockholders | $ | 79 | $ | 143 | $ | (64 | ) | (45 | )% | |||||||
Income (loss) from discontinued operations available to Genworth Financial, Inc.’s common stockholders | (520 | ) | 25 | (545 | ) | NM | (1) | |||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (441 | ) | $ | 168 | $ | (609 | ) | NM | (1) | ||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
during this period will ultimately return to normal levels, partially offsetting the favorable development on in-force block (including higher frequency of new claims), higher incremental reserves of $43 million recorded in connection with an accrual for profits followed by losses and higher severity of new claims in the current year. The decrease was also partially offset by $15 million of a less favorable impact from reduced benefits in the current year in-force rate actions approved and implemented. Our life insurance business increased 10-year term universal life insurance block entering its post-level premium period during the COVID-19. Our fixed annuities business |
Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 2,240 | $ | 2,276 | $ | (36 | ) | (2 | )% | |||||||
Net investment income | 1,681 | 1,632 | 49 | 3 | % | |||||||||||
Net investment gains (losses) | 29 | (45 | ) | 74 | 164 | % | ||||||||||
Policy fees and other income | 410 | 411 | (1 | ) | — | % | ||||||||||
Total revenues | 4,360 | 4,274 | 86 | 2 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 2,571 | 2,516 | 55 | 2 | % | |||||||||||
Interest credited | 293 | 308 | (15 | ) | (5 | )% | ||||||||||
Acquisition and operating expenses, net of deferrals | 498 | 493 | 5 | 1 | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 186 | 216 | (30 | ) | (14 | )% | ||||||||||
Interest expense | 145 | 153 | (8 | ) | (5 | )% | ||||||||||
Total benefits and expenses | 3,693 | 3,686 | 7 | — | % | |||||||||||
Income before income taxes | 667 | 588 | 79 | 13 | % | |||||||||||
Provision for income taxes | 219 | 174 | 45 | 26 | % | |||||||||||
Net income | 448 | 414 | 34 | 8 | % | |||||||||||
Less: net income attributable to noncontrolling interests | 106 | 112 | (6 | ) | (5 | )% | ||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | $ | 342 | $ | 302 | $ | 40 | 13 | % | ||||||||
Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 2,034 | $ | 1,989 | $ | 45 | 2 | % | ||||||||
Net investment income | 1,579 | 1,610 | (31 | ) | (2 | )% | ||||||||||
Net investment gains (losses) | 7 | 29 | (22 | ) | (76 | )% | ||||||||||
Policy fees and other income | 355 | 410 | (55 | ) | (13 | )% | ||||||||||
Total revenues | 3,975 | 4,038 | (63 | ) | (2 | )% | ||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 2,847 | 2,533 | 314 | 12 | % | |||||||||||
Interest credited | 280 | 293 | (13 | ) | (4 | )% | ||||||||||
Acquisition and operating expenses, net of deferrals | 472 | 466 | 6 | 1 | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 209 | 165 | 44 | 27 | % | |||||||||||
Goodwill impairment | 5 | — | 5 | NM | (1) | |||||||||||
Interest expense | 96 | 120 | (24 | ) | (20 | )% | ||||||||||
Total benefits and expenses | 3,909 | 3,577 | 332 | 9 | % | |||||||||||
Income from continuing operations before income taxes | 66 | 461 | (395 | ) | (86 | )% | ||||||||||
Provision for income taxes | 36 | 135 | (99 | ) | (73 | )% | ||||||||||
Income from continuing operations | 30 | 326 | (296 | ) | (91 | )% | ||||||||||
Income (loss) from discontinued operations, net of taxes | (520 | ) | 122 | (642 | ) | NM | (1) | |||||||||
Net income (loss) | (490 | ) | 448 | (938 | ) | NM | (1) | |||||||||
Less: net income from continuing operations attributable to noncontrolling interests | 17 | 35 | (18 | ) | (51 | )% | ||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests | — | 71 | (71 | ) | (100 | )% | ||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (507 | ) | $ | 342 | $ | (849 | ) | NM | (1) | ||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
Income from continuing operations available to Genworth Financial, Inc.’s common stockholders | $ | 13 | $ | 291 | $ | (278 | ) | (96 | )% | |||||||
Income (loss) from discontinued operations available to Genworth Financial, Inc.’s common stockholders | (520 | ) | 51 | (571 | ) | NM | (1) | |||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (507 | ) | $ | 342 | $ | (849 | ) | NM | (1) | ||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Net income | $ | 218 | $ | 249 | $ | 448 | $ | 414 | ||||||||
Less: net income attributable to noncontrolling interests | 50 | 59 | 106 | 112 | ||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | 168 | 190 | 342 | 302 | ||||||||||||
Adjustments to net income available to Genworth Financial, Inc.’scommon stockholders: | ||||||||||||||||
Net investment (gains) losses, net (1) | 43 | 12 | (28 | ) | 29 | |||||||||||
(Gains) losses on early extinguishment of debt, net (2) | 1 | — | 1 | — | ||||||||||||
Expenses related to restructuring | — | — | 4 | — | ||||||||||||
Taxes on adjustments | (8 | ) | (2 | ) | 6 | (6 | ) | |||||||||
Adjusted operating income available to Genworth Financial, Inc.’scommon stockholders | $ | 204 | $ | 200 | $ | 325 | $ | 325 | ||||||||
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (441 | ) | $ | 168 | $ | (507 | ) | $ | 342 | ||||||
Add: net income from continuing operations attributable to noncontrolling interests | 23 | 15 | 17 | 35 | ||||||||||||
Add: net income from discontinued operations attributable to noncontrolling interests | — | 35 | — | 71 | ||||||||||||
Net income (loss) | (418 | ) | 218 | (490 | ) | 448 | ||||||||||
Less: income (loss) from discontinued operations, net of taxes | (520 | ) | 60 | (520 | ) | 122 | ||||||||||
Income from continuing operations | 102 | 158 | 30 | 326 | ||||||||||||
Less: net income from continuing operations attributable to noncontrolling interests | 23 | 15 | 17 | 35 | ||||||||||||
Income from continuing operations available to Genworth Financial, Inc.’s common stockholders | 79 | 143 | 13 | 291 | ||||||||||||
Adjustments to income from continuing operations available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
Net investment (gains) losses, net (1) | (131 | ) | 43 | (16 | ) | (28 | ) | |||||||||
Goodwill impairment, net (2) | 3 | — | 3 | — | ||||||||||||
(Gains) losses on early extinguishment of debt, net | (3 | ) | — | 9 | — | |||||||||||
Expenses related to restructuring | 1 | — | 2 | 4 | ||||||||||||
Taxes on adjustments | 30 | (8 | ) | 1 | 6 | |||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (21 | ) | $ | 178 | $ | 12 | $ | 273 | |||||||
(1) | For the three months ended June 30, |
(2) | For the three and six months ended June 30, |
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions, except per share amounts) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Net income available to Genworth Financial, Inc.’s commonstockholders per share: | ||||||||||||||||
Basic | $ | 0.33 | $ | 0.38 | $ | 0.68 | $ | 0.60 | ||||||||
Diluted | $ | 0.33 | $ | 0.38 | $ | 0.67 | $ | 0.60 | ||||||||
Adjusted operating income available to Genworth Financial,Inc.’s common stockholders per share: | ||||||||||||||||
Basic | $ | 0.40 | $ | 0.40 | $ | 0.65 | $ | 0.65 | ||||||||
Diluted | $ | 0.40 | $ | 0.40 | $ | 0.64 | $ | 0.65 | ||||||||
Weighted-average common shares outstanding: | ||||||||||||||||
Basic | 503.4 | 500.6 | 502.3 | 500.1 | ||||||||||||
Diluted | 508.7 | 502.6 | 508.7 | 502.6 | ||||||||||||
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
(Amounts in millions, except per share amounts) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Income from continuing operations available to Genworth Financial, Inc.’s common stockholders per share: | ||||||||||||||||
Basic | $ | 0.16 | $ | 0.29 | $ | 0.03 | $ | 0.58 | ||||||||
Diluted | $ | 0.15 | $ | 0.28 | $ | 0.03 | $ | 0.57 | ||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders per share: | ||||||||||||||||
Basic | $ | (0.87 | ) | $ | 0.33 | $ | (1.00 | ) | $ | 0.68 | ||||||
Diluted | $ | (0.86 | ) | $ | 0.33 | $ | (0.99 | ) | $ | 0.67 | ||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders per share: | ||||||||||||||||
Basic | $ | (0.04 | ) | $ | 0.35 | $ | 0.02 | $ | 0.54 | |||||||
Diluted | $ | (0.04 | ) | $ | 0.35 | $ | 0.02 | $ | 0.54 | |||||||
Weighted-average common shares outstanding: | ||||||||||||||||
Basic | 505.4 | 503.4 | 504.8 | 502.3 | ||||||||||||
Diluted | 512.5 | 508.7 | 511.1 | 508.7 | ||||||||||||
Three months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 206 | $ | 184 | $ | 22 | 12 | % | ||||||||
Net investment income | 28 | 23 | 5 | 22 | % | |||||||||||
Net investment gains (losses) | — | — | — | — | % | |||||||||||
Policy fees and other income | 1 | 1 | — | — | % | |||||||||||
Total revenues | 235 | 208 | 27 | 13 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | — | (14 | ) | 14 | 100 | % | ||||||||||
Acquisition and operating expenses, net of deferrals | 44 | 45 | (1 | ) | (2 | )% | ||||||||||
Amortization of deferred acquisition costs and intangibles | 4 | 3 | 1 | 33 | % | |||||||||||
Total benefits and expenses | 48 | 34 | 14 | 41 | % | |||||||||||
Income before income taxes | 187 | 174 | 13 | 7 | % | |||||||||||
Provision for income taxes | 40 | 37 | 3 | 8 | % | |||||||||||
Net income | 147 | 137 | 10 | 7 | % | |||||||||||
Adjustments to net income: | ||||||||||||||||
Net investment (gains) losses | — | — | — | — | % | |||||||||||
Taxes on adjustments | — | — | — | — | % | |||||||||||
Adjusted operating income available to Genworth Financial, Inc.’s common stockholders | $ | 147 | $ | 137 | $ | 10 | 7 | % | ||||||||
Three months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 243 | $ | 206 | $ | 37 | 18 | % | ||||||||
Net investment income | 31 | 28 | 3 | 11 | % | |||||||||||
Net investment gains (losses) | (1 | ) | — | (1 | ) | NM | (1) | |||||||||
Policy fees and other income | 1 | 1 | — | — | % | |||||||||||
Total revenues | 274 | 235 | 39 | 17 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 228 | — | 228 | NM | (1) | |||||||||||
Acquisition and operating expenses, net of deferrals | 47 | 44 | 3 | 7 | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 4 | 4 | — | — | % | |||||||||||
Total benefits and expenses | 279 | 48 | 231 | NM | (1) | |||||||||||
Income (loss) from continuing operations before income taxes | (5 | ) | 187 | (192 | ) | (103 | )% | |||||||||
Provision (benefit) for income taxes | (1 | ) | 40 | (41 | ) | (103 | )% | |||||||||
Income (loss) from continuing operations | (4 | ) | 147 | (151 | ) | (103 | )% | |||||||||
Adjustments to income (loss) from continuing operations: | ||||||||||||||||
Net investment (gains) losses | 1 | — | 1 | NM | (1) | |||||||||||
Taxes on adjustments | — | — | — | — | % | |||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (3 | ) | $ | 147 | $ | (150 | ) | (102 | )% | ||||||
Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 400 | $ | 363 | $ | 37 | 10 | % | ||||||||
Net investment income | 56 | 44 | 12 | 27 | % | |||||||||||
Net investment gains (losses) | — | — | — | — | % | |||||||||||
Policy fees and other income | 2 | 1 | 1 | 100 | % | |||||||||||
Total revenues | 458 | 408 | 50 | 12 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 16 | 2 | 14 | NM | (1) | |||||||||||
Acquisition and operating expenses, net of deferrals | 90 | 84 | 6 | 7 | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 8 | 7 | 1 | 14 | % | |||||||||||
Total benefits and expenses | 114 | 93 | 21 | 23 | % | |||||||||||
Income before income taxes | 344 | 315 | 29 | 9 | % | |||||||||||
Provision for income taxes | 73 | 67 | 6 | 9 | % | |||||||||||
Net income | 271 | 248 | 23 | 9 | % | |||||||||||
Adjustments to net income: | ||||||||||||||||
Net investment (gains) losses | — | — | — | — | % | |||||||||||
Taxes on adjustments | — | — | — | — | % | |||||||||||
Adjusted operating income available to Genworth Financial, Inc.’s common stockholders | $ | 271 | $ | 248 | $ | 23 | 9 | % | ||||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
Increase | ||||||||||||||||
(decrease) and | ||||||||||||||||
Six months ended | percentage | |||||||||||||||
June 30, | change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 469 | $ | 400 | $ | 69 | 17 | % | ||||||||
Net investment income | 64 | 56 | 8 | 14 | % | |||||||||||
Net investment gains (losses) | (1 | ) | — | (1 | ) | NM | (1) | |||||||||
Policy fees and other income | 3 | 2 | 1 | 50 | % | |||||||||||
Total revenues | 535 | 458 | 77 | 17 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 247 | 16 | 231 | NM | (1) | |||||||||||
Acquisition and operating expenses, net of deferrals | 97 | 90 | 7 | 8 | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 8 | 8 | — | — | % | |||||||||||
Total benefits and expenses | 352 | 114 | 238 | NM | (1) | |||||||||||
Income from continuing operations before income taxes | 183 | 344 | (161 | ) | (47 | )% | ||||||||||
Provision for income taxes | 39 | 73 | (34 | ) | (47 | )% | ||||||||||
Income from continuing operations | 144 | 271 | (127 | ) | (47 | )% | ||||||||||
Adjustments to income from continuing operations: | ||||||||||||||||
Net investment (gains) losses | 1 | — | 1 | NM | (1) | |||||||||||
Taxes on adjustments | — | — | — | — | % | |||||||||||
Adjusted operating income available to Genworth Financial, Inc.’s common stockholders | $ | 145 | $ | 271 | $ | (126 | ) | (46 | )% | |||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
As of June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Primary insurance in-force (1) | $ | 178,500 | $ | 159,500 | $ | 19,000 | 12 | % | ||||||||
Risk in-force | $ | 43,100 | $ | 38,700 | $ | 4,400 | 11 | % |
Increase (decrease) and | ||||||||||||||||
As of June 30, | percentage change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Primary insurance in-force (1) | $ | 207,400 | $ | 178,500 | $ | 28,900 | 16 | % | ||||||||
Risk in-force | $ | 50,000 | $ | 43,100 | $ | 6,900 | 16 | % |
(1) | Primary insurance in-force represents the aggregate original loan balance for outstanding insurance policies and is used to determine premiums. Original loan balances are presented for policies with level renewal premiums. Amortized loan balances are presented for policies with annual, amortizing renewal premiums. |
Three months ended June 30, | Increase (decrease) and percentage change | Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | 2019 | 2018 | 2019 vs. 2018 | ||||||||||||||||||||||||||
New insurance written | $ | 15,800 | $ | 11,400 | $ | 4,400 | 39 | % | $ | 25,400 | $ | 20,400 | $ | 5,000 | 25 | % | ||||||||||||||||
Net premiums written | $ | 204 | $ | 191 | $ | 13 | 7 | % | $ | 397 | $ | 376 | $ | 21 | 6 | % |
Increase | Increase | |||||||||||||||||||||||||||||||
(decrease) and | (decrease) and | |||||||||||||||||||||||||||||||
Three months ended | percentage | Six months ended | percentage | |||||||||||||||||||||||||||||
June 30, | change | June 30, | change | |||||||||||||||||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | 2020 | 2019 | 2020 vs. 2019 | ||||||||||||||||||||||||||
New insurance written | $ | 28,400 | $ | 15,800 | $ | 12,600 | 80 | % | $ | 46,300 | $ | 25,400 | $ | 20,900 | 82 | % | ||||||||||||||||
Net premiums written | $ | 217 | $ | 204 | $ | 13 | 6 | % | $ | 425 | $ | 397 | $ | 28 | 7 | % |
Three months ended June 30, | Increase (decrease) | Six months ended June 30, | Increase (decrease) | |||||||||||||||||||||
2019 | 2018 | 2019 vs. 2018 | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||||||||
Loss ratio | — | % | (8 | )% | 8 | % | 4 | % | — | % | 4 | % | ||||||||||||
Expense ratio (net earned premiums) | 24 | % | 26 | % | (2 | )% | 25 | % | 25 | % | — | % | ||||||||||||
Expense ratio (net premiums written) | 24 | % | 25 | % | (1 | )% | 25 | % | 24 | % | 1 | % |
Three months ended | Six months ended | |||||||||||||||||||||||
June 30, | Increase (decrease) | June 30, | Increase (decrease) | |||||||||||||||||||||
2020 | 2019 | 2020 vs. 2019 | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||||||||
Loss ratio | 94 | % | — | % | 94 | % | 53 | % | 4 | % | 49 | % | ||||||||||||
Expense ratio (net earned premiums) | 21 | % | 24 | % | (3 | )% | 22 | % | 25 | % | (3 | )% | ||||||||||||
Expense ratio (net premiums written) | 23 | % | 24 | % | (1 | )% | 25 | % | 25 | % | — | % |
June 30, 2019 | December 31, 2018 | June 30, 2018 | ||||||||||
Primary insurance: | ||||||||||||
Insured loans in-force | 818,358 | 783,288 | 762,727 | |||||||||
Delinquent loans | 15,482 | 17,159 | 18,051 | |||||||||
Percentage of delinquent loans (delinquency rate) | 1.89 | % | 2.19 | % | 2.37 | % | ||||||
Flow loans in-force | 806,739 | 770,657 | 748,497 | |||||||||
Flow delinquent loans | 15,070 | 16,670 | 17,505 | |||||||||
Percentage of flow delinquent loans (delinquency rate) | 1.87 | % | 2.16 | % | 2.34 | % | ||||||
Bulk loans in-force | 11,619 | 12,631 | 14,230 | |||||||||
Bulk delinquent loans (1) | 412 | 489 | 546 | |||||||||
Percentage of bulk delinquent loans (delinquency rate) | 3.55 | % | 3.87 | % | 3.84 | % | ||||||
A minus and sub-prime loans in-force | 14,180 | 15,348 | 16,928 | |||||||||
A minus and sub-prime delinquent loans | 2,367 | 2,727 | 3,058 | |||||||||
Percentage of A minus and sub-prime delinquent loans (delinquency rate) | 16.69 | % | 17.77 | % | 18.06 | % | ||||||
Pool insurance: | ||||||||||||
Insured loans in-force | 4,331 | 4,535 | 4,774 | |||||||||
Delinquent loans | 177 | 220 | 204 | |||||||||
Percentage of delinquent loans (delinquency rate) | 4.09 | % | 4.85 | % | 4.27 | % |
June 30, | December 31, | June 30, | ||||||||||
2020 | 2019 | 2019 | ||||||||||
Primary insurance: | ||||||||||||
Insured loans in-force | 904,753 | 860,214 | 818,358 | |||||||||
Delinquent loans | 53,894 | 16,607 | 15,482 | |||||||||
Percentage of delinquent loans (delinquency rate) | 5.96 | % | 1.93 | % | 1.89 | % | ||||||
Flow loans in-force | 894,715 | 846,472 | 806,739 | |||||||||
Flow delinquent loans | 53,372 | 16,209 | 15,070 | |||||||||
Percentage of flow delinquent loans (delinquency rate) | 5.97 | % | 1.91 | % | 1.87 | % | ||||||
Bulk loans in-force | 10,038 | 10,742 | 11,619 | |||||||||
Bulk delinquent loans (1) | 522 | 398 | 412 | |||||||||
Percentage of bulk delinquent loans (delinquency rate) | 5.20 | % | 3.71 | % | 3.55 | % | ||||||
A minus and sub-prime loansin-force | 11,712 | 12,792 | 14,180 | |||||||||
A minus and sub-prime delinquent loans | 2,470 | 2,283 | 2,367 | |||||||||
Percentage of A minus and sub-prime delinquent loans (delinquency rate) | 21.09 | % | 17.85 | % | 16.69 | % | ||||||
Pool insurance: | ||||||||||||
Insured loans in-force | 3,818 | 4,122 | 4,331 | |||||||||
Delinquent loans | 151 | 167 | 177 | |||||||||
Percentage of delinquent loans (delinquency rate) | 3.95 | % | 4.05 | % | 4.09 | % |
(1) | Included loans where we were in a secondary loss position for which no reserve was established due to an existing deductible. Excluding these loans, bulk delinquent loans were 422 as of June 30, 2020, 348 as of December 31, 2019 and 347 as of June 30, |
June 30, 2019 | ||||||||||||||||
(Dollar amounts in millions) | Delinquencies | Direct case reserves (1) | Risk in-force | Reserves as % of risk in-force | ||||||||||||
Payments in default: | ||||||||||||||||
3 payments or less | 7,629 | $ | 26 | $ | 341 | 8 | % | |||||||||
4 - 11 payments | 4,162 | 75 | 190 | 39 | % | |||||||||||
12 payments or more | 3,279 | 121 | 167 | 72 | % | |||||||||||
Total | 15,070 | $ | 222 | $ | 698 | 32 | % | |||||||||
June 30, 2020 | ||||||||||||||||
Direct case | Risk | Reserves as % | ||||||||||||||
(Dollar amounts in millions) | Delinquencies | reserves (1) | in-force | of risk in-force | ||||||||||||
Payments in default: | ||||||||||||||||
3 payments or less | 43,044 | $ | 162 | $ | 2,687 | 6 | % | |||||||||
4 - 11 payments | 7,404 | 111 | 388 | 29 | % | |||||||||||
12 payments or more | 2,924 | 105 | 147 | 71 | % | |||||||||||
Total | 53,372 | $ | 378 | $ | 3,222 | 12 | % | |||||||||
(1) | Direct flow case reserves exclude loss adjustment expenses, incurred but not reported and reinsurance reserves. |
December 31, 2019 | ||||||||||||||||
Direct case | Risk | Reserves as % | ||||||||||||||
(Dollar amounts in millions) | Delinquencies | reserves (1) | in-force | of risk in-force | ||||||||||||
Payments in default: | ||||||||||||||||
3 payments or less | 8,524 | $ | 27 | $ | 386 | 7 | % | |||||||||
4 - 11 payments | 4,836 | 78 | 224 | 35 | % | |||||||||||
12 payments or more | 2,849 | 99 | 145 | 68 | % | |||||||||||
Total | 16,209 | $ | 204 | $ | 755 | 27 | % | |||||||||
December 31, 2018 | ||||||||||||||||
(Dollar amounts in millions) | Delinquencies | Direct case reserves (1) | Risk in-force | Reserves as % of risk in-force | ||||||||||||
Payments in default: | ||||||||||||||||
3 payments or less | 8,360 | $ | 31 | $ | 365 | 8 | % | |||||||||
4 - 11 payments | 4,591 | 88 | 208 | 42 | % | |||||||||||
12 payments or more | 3,719 | 142 | 188 | 76 | % | |||||||||||
Total | 16,670 | $ | 261 | $ | 761 | 34 | % | |||||||||
(1) | Direct flow case reserves exclude loss adjustment expenses, incurred but not reported and reinsurance reserves. |
Percent of primary | Percent of total | Delinquency rate | ||||||||||||||||||
risk in-force as of June 30, 2019 | reserves as of June 30, 2019 (1) | June 30, 2019 | December 31, 2018 | June 30, 2018 | ||||||||||||||||
By Region: | ||||||||||||||||||||
Southeast (2) | 18 | % | 21 | % | 2.18 | % | 2.63 | % | 3.15 | % | ||||||||||
Pacific (3) | 17 | 10 | 1.22 | % | 1.29 | % | 1.30 | % | ||||||||||||
South Central (4) | 16 | 11 | 1.79 | % | 2.11 | % | 2.30 | % | ||||||||||||
Northeast (5) | 12 | 28 | 2.87 | % | 3.43 | % | 3.74 | % | ||||||||||||
North Central (6) | 11 | 9 | 1.79 | % | 1.98 | % | 1.96 | % | ||||||||||||
Great Lakes (7) | 11 | 7 | 1.56 | % | 1.72 | % | 1.72 | % | ||||||||||||
Mid-Atlantic (8) | 6 | 5 | 1.81 | % | 2.16 | % | 2.19 | % | ||||||||||||
New England (9) | 5 | 6 | 1.95 | % | 2.23 | % | 2.27 | % | ||||||||||||
Plains (10) | 4 | 3 | 1.67 | % | 1.87 | % | 1.88 | % | ||||||||||||
Total | 100 | % | 100 | % | 1.89 | % | 2.19 | % | 2.37 | % | ||||||||||
Percent of primary risk in-force as of June 30, 2020 | Percent of total reserves as of June 30, 2020 (1) | Delinquency rate | ||||||||||||||||||
June 30, | December 31, | June 30, | ||||||||||||||||||
2020 | 2019 | 2019 | ||||||||||||||||||
By Region: | ||||||||||||||||||||
Southeast (2) | 19 | % | 21 | % | 6.68 | % | 2.15 | % | 2.18 | % | ||||||||||
Pacific (3) | 18 | 17 | 7.24 | % | 1.36 | % | 1.22 | % | ||||||||||||
South Central (4) | 17 | 14 | 6.02 | % | 1.84 | % | 1.79 | % | ||||||||||||
Northeast (5) | 12 | 21 | 8.01 | % | 2.72 | % | 2.87 | % | ||||||||||||
Great Lakes (6) | 10 | 6 | 3.81 | % | 1.69 | % | 1.56 | % | ||||||||||||
North Central (7) | 10 | 9 | 4.97 | % | 1.91 | % | 1.79 | % | ||||||||||||
Mid-Atlantic (8) | 6 | 5 | 6.31 | % | 1.90 | % | 1.81 | % | ||||||||||||
New England (9) | 5 | 5 | 5.22 | % | 1.92 | % | 1.95 | % | ||||||||||||
Plains (10) | 3 | 2 | 3.31 | % | 1.69 | % | 1.67 | % | ||||||||||||
Total | 100 | % | 100 | % | 5.96 | % | 1.93 | % | 1.89 | % | ||||||||||
(1) | Total reserves were |
(2) | Alabama, Arkansas, Florida, Georgia, Mississippi, North Carolina, South Carolina and Tennessee. |
(3) | Alaska, California, Hawaii, Nevada, Oregon and Washington. |
(4) | Arizona, Colorado, Louisiana, New Mexico, Oklahoma, Texas and Utah. |
(5) | New Jersey, New York and Pennsylvania. |
(6) |
(7) | Illinois, Minnesota, Missouri and Wisconsin. |
Delaware, Maryland, Virginia, Washington D.C. and West Virginia. |
(9) | Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont. |
(10) | Idaho, Iowa, Kansas, Montana, Nebraska, North Dakota, South Dakota and Wyoming. |
Percent of primary risk in-force as of June 30, 2020 | Percent of total reserves as of June 30, 2020 (1) | Delinquency rate | ||||||||||||||||||
June 30, | December 31, | June 30, | ||||||||||||||||||
2020 | 2019 | 2019 | ||||||||||||||||||
By State: | ||||||||||||||||||||
California | 11 | % | 10 | % | 7.63 | % | 1.42 | % | 1.26 | % | ||||||||||
Texas | 7 | % | 7 | % | 7.30 | % | 2.02 | % | 1.86 | % | ||||||||||
Florida | 7 | % | 11 | % | 9.04 | % | 2.13 | % | 2.26 | % | ||||||||||
New York | 5 | % | 12 | % | 8.90 | % | 3.00 | % | 3.12 | % | ||||||||||
Illinois | 5 | % | 6 | % | 6.12 | % | 2.27 | % | 2.10 | % | ||||||||||
Washington | 4 | % | 3 | % | 5.59 | % | 1.10 | % | 0.90 | % | ||||||||||
Michigan | 4 | % | 2 | % | 4.08 | % | 1.44 | % | 1.28 | % | ||||||||||
Pennsylvania | 4 | % | 3 | % | 5.46 | % | 2.15 | % | 2.24 | % | ||||||||||
North Carolina | 4 | % | 3 | % | 4.99 | % | 1.79 | % | 1.82 | % | ||||||||||
Ohio | 3 | % | 2 | % | 4.01 | % | 1.84 | % | 1.69 | % |
Percent of primary | Percent of total | Delinquency rate | ||||||||||||||||||
risk in-force as of June 30, 2019 | reserves as of June 30, 2019 (1) | June 30, 2019 | December 31, 2018 | June 30, 2018 | ||||||||||||||||
By State: | ||||||||||||||||||||
California | 10 | % | 5 | % | 1.26 | % | 1.28 | % | 1.21 | % | ||||||||||
Texas | 7 | % | 5 | % | 1.86 | % | 2.29 | % | 2.77 | % | ||||||||||
Florida | 6 | % | 12 | % | 2.26 | % | 2.91 | % | 4.57 | % | ||||||||||
Illinois | 5 | % | 6 | % | 2.10 | % | 2.26 | % | 2.27 | % | ||||||||||
New York | 5 | % | 16 | % | 3.12 | % | 3.64 | % | 3.99 | % | ||||||||||
Washington | 5 | % | 2 | % | 0.90 | % | 1.04 | % | 1.05 | % | ||||||||||
Michigan | 4 | % | 2 | % | 1.28 | % | 1.40 | % | 1.26 | % | ||||||||||
Pennsylvania | 4 | % | 4 | % | 2.24 | % | 2.79 | % | 2.80 | % | ||||||||||
North Carolina | 4 | % | 3 | % | 1.82 | % | 2.27 | % | 2.15 | % | ||||||||||
Ohio | 3 | % | 3 | % | 1.69 | % | 1.97 | % | 1.98 | % |
(1) | Total reserves were |
(Amounts in millions) | Average rate | Percent of total reserves (1) | Primary insurance in-force | Percent of total | Primary risk in-force | Percent of total | ||||||||||||||||||
Policy Year | ||||||||||||||||||||||||
2004 and prior | 6.10 | % | 8.4 | % | $ | 1,515 | 0.9 | % | $ | 285 | 0.7 | % | ||||||||||||
2005 - 2008 | 5.47 | % | 58.2 | 17,576 | 9.8 | 4,037 | 9.4 | |||||||||||||||||
2009 - 2012 | 4.29 | % | 2.2 | 3,934 | 2.2 | 913 | 2.1 | |||||||||||||||||
2013 | 4.11 | % | 1.8 | 4,755 | 2.7 | 1,162 | 2.7 | |||||||||||||||||
2014 | 4.45 | % | 4.4 | 8,277 | 4.6 | 2,013 | 4.7 | |||||||||||||||||
2015 | 4.15 | % | 6.2 | 16,648 | 9.3 | 4,023 | 9.3 | |||||||||||||||||
2016 | 3.89 | % | 7.5 | 30,515 | 17.1 | 7,348 | 17.0 | |||||||||||||||||
2017 | 4.25 | % | 7.2 | 33,245 | 18.6 | 8,087 | 18.8 | |||||||||||||||||
2018 | 4.77 | % | 3.9 | 36,887 | 20.7 | 9,025 | 20.9 | |||||||||||||||||
2019 | 4.75 | % | 0.2 | 25,129 | 14.1 | 6,191 | 14.4 | |||||||||||||||||
Total portfolio | 4.53 | % | 100.0 | % | $ | 178,481 | 100.0 | % | $ | 43,084 | 100.0 | % | ||||||||||||
Primary | Primary | |||||||||||||||||||||||
Average | Percent of total | insurance | Percent | risk | Percent | |||||||||||||||||||
(Amounts in millions) | rate | reserves (1) | in-force | of total | in-force | of total | ||||||||||||||||||
Policy Year | ||||||||||||||||||||||||
2004 and prior | 6.15 | % | 4.2 | % | $ | 1,241 | 0.6 | % | $ | 231 | 0.5 | % | ||||||||||||
2005 to 2008 | 5.47 | % | 30.2 | 14,017 | 6.8 | 3,193 | 6.4 | |||||||||||||||||
2009 to 2013 | 4.23 | % | 2.7 | 5,461 | 2.6 | 1,267 | 2.5 | |||||||||||||||||
2014 | 4.46 | % | 3.1 | 5,719 | 2.8 | 1,367 | 2.7 | |||||||||||||||||
2015 | 4.16 | % | 5.1 | 11,858 | 5.7 | 2,843 | 5.7 | |||||||||||||||||
2016 | 3.89 | % | 9.2 | 22,566 | 10.9 | 5,415 | 10.8 | |||||||||||||||||
2017 | 4.25 | % | 11.5 | 23,845 | 11.5 | 5,752 | 11.5 | |||||||||||||||||
2018 | 4.77 | % | 12.9 | 24,767 | 11.9 | 5,975 | 12.0 | |||||||||||||||||
2019 | 4.25 | % | 18.4 | 52,068 | 25.1 | 12,690 | 25.4 | |||||||||||||||||
2020 | 3.58 | % | 2.7 | 45,816 | 22.1 | 11,253 | 22.5 | |||||||||||||||||
Total portfolio | 4.29 | % | 100.0 | % | $ | 207,358 | 100.0 | % | $ | 49,986 | 100.0 | % | ||||||||||||
(1) | Total reserves were |
Three months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 125 | $ | 131 | $ | (6 | ) | (5 | )% | |||||||
Net investment income | 35 | 34 | 1 | 3 | % | |||||||||||
Net investment gains (losses) | 1 | (15 | ) | 16 | 107 | % | ||||||||||
Total revenues | 161 | 150 | 11 | 7 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 19 | 19 | — | — | % | |||||||||||
Acquisition and operating expenses, net of deferrals | 22 | 20 | 2 | 10 | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 11 | 11 | — | — | % | |||||||||||
Interest expense | 5 | 4 | 1 | 25 | % | |||||||||||
Total benefits and expenses | 57 | 54 | 3 | 6 | % | |||||||||||
Income before income taxes | 104 | 96 | 8 | 8 | % | |||||||||||
Provision for income taxes | 29 | 24 | 5 | 21 | % | |||||||||||
Net income | 75 | 72 | 3 | 4 | % | |||||||||||
Less: net income attributable to noncontrolling interests | 35 | 32 | 3 | 9 | % | |||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | 40 | 40 | — | — | % | |||||||||||
Adjustments to net income available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
Net investment (gains) losses, net (2) | — | 8 | (8 | ) | (100 | )% | ||||||||||
(Gains) losses on early extinguishment of debt, net (3) | 1 | — | 1 | NM | (1) | |||||||||||
Taxes on adjustments | — | (2 | ) | 2 | 100 | % | ||||||||||
Adjusted operating income available to Genworth Financial, Inc.’s common stockholders | $ | 41 | $ | 46 | $ | (5 | ) | (11 | )% | |||||||
Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 251 | $ | 270 | $ | (19 | ) | (7 | )% | |||||||
Net investment income | 69 | 68 | 1 | 1 | % | |||||||||||
Net investment gains (losses) | — | (30 | ) | 30 | 100 | % | ||||||||||
Total revenues | 320 | 308 | 12 | 4 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 38 | 37 | 1 | 3 | % | |||||||||||
Acquisition and operating expenses, net of deferrals | 42 | 37 | 5 | 14 | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 21 | 21 | — | — | % | |||||||||||
Interest expense | 9 | 9 | — | — | % | |||||||||||
Total benefits and expenses | 110 | 104 | 6 | 6 | % | |||||||||||
Income before income taxes | 210 | 204 | 6 | 3 | % | |||||||||||
Provision for income taxes | 58 | 54 | 4 | 7 | % | |||||||||||
Net income | 152 | 150 | 2 | 1 | % | |||||||||||
Less: net income attributable to noncontrolling interests | 71 | 68 | 3 | 4 | % | |||||||||||
Net income available to Genworth Financial, Inc.’s commonstockholders | 81 | 82 | (1 | ) | (1 | )% | ||||||||||
Adjustments to net income available to Genworth Financial, Inc.’scommon stockholders: | ||||||||||||||||
Net investment (gains) losses, net (2) | — | 17 | (17 | ) | (100 | )% | ||||||||||
(Gains) losses on early extinguishment of debt, net (3) | 1 | — | 1 | NM | (1) | |||||||||||
Taxes on adjustments | — | (4 | ) | 4 | 100 | % | ||||||||||
Adjusted operating income available to Genworth Financial, Inc.’scommon stockholders | $ | 82 | $ | 95 | $ | (13 | ) | (14 | )% | |||||||
As of June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Primary insurance in-force | $ | 395,700 | $ | 380,200 | $ | 15,500 | 4 | % | ||||||||
Risk in-force | $ | 138,500 | $ | 133,100 | $ | 5,400 | 4 | % |
Three months ended June 30, | Increase (decrease) and percentage change | Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | 2019 | 2018 | 2019 vs. 2018 | ||||||||||||||||||||||||||
New insurance written | $ | 5,800 | $ | 4,600 | $ | 1,200 | 26 | % | $ | 8,700 | $ | 8,000 | $ | 700 | 9 | % | ||||||||||||||||
Net premiums written | $ | 145 | $ | 133 | $ | 12 | 9 | % | $ | 224 | $ | 225 | $ | (1 | ) | — | % |
Three months ended June 30, | Increase (decrease) | Six months ended June 30, | Increase (decrease) | |||||||||||||||||||||
2019 | 2018 | 2019 vs. 2018 | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||||||||
Loss ratio | 15 | % | 15 | % | — | % | 15 | % | 14 | % | 1 | % | ||||||||||||
Expense ratio (net earned premiums) | 26 | % | 23 | % | 3 | % | 25 | % | 21 | % | 4 | % | ||||||||||||
Expense ratio (net premiums written) | 22 | % | 23 | % | (1 | )% | 28 | % | 26 | % | 2 | % |
June 30, 2019 | December 31, 2018 | June 30, 2018 | ||||||||||
Primary insured loans in-force (1) | 2,174,084 | 2,143,191 | 2,137,221 | |||||||||
Delinquent loans | 1,701 | 1,684 | 1,742 | |||||||||
Percentage of delinquent loans (delinquency rate) (1) | 0.08 | % | 0.08 | % | 0.08 | % | ||||||
Flow loans in-force | 1,523,128 | 1,499,304 | 1,470,826 | |||||||||
Flow delinquent loans | 1,340 | 1,310 | 1,406 | |||||||||
Percentage of flow delinquent loans (delinquency rate) | 0.09 | % | 0.09 | % | 0.10 | % | ||||||
Bulk loans in-force | 650,956 | 643,887 | 666,395 | |||||||||
Bulk delinquent loans | 361 | 374 | 336 | |||||||||
Percentage of bulk delinquent loans (delinquency rate) | 0.06 | % | 0.06 | % | 0.05 | % |
Percent of primary risk in-force as of June 30, 2019 | Delinquency rate | |||||||||||||||
June 30, | December 31, | June 30, | ||||||||||||||
2019 | 2018 | 2018 | ||||||||||||||
By province and territory: | ||||||||||||||||
Ontario | 47 | % | 0.03 | % | 0.03 | % | 0.03 | % | ||||||||
Alberta | 17 | 0.21 | % | 0.18 | % | 0.17 | % | |||||||||
British Columbia | 14 | 0.04 | % | 0.04 | % | 0.04 | % | |||||||||
Quebec | 13 | 0.07 | % | 0.10 | % | 0.10 | % | |||||||||
Saskatchewan | 3 | 0.27 | % | 0.28 | % | 0.28 | % | |||||||||
Nova Scotia | 2 | 0.13 | % | 0.13 | % | 0.15 | % | |||||||||
Manitoba | 2 | 0.09 | % | 0.10 | % | 0.10 | % | |||||||||
New Brunswick | 1 | 0.08 | % | 0.10 | % | 0.15 | % | |||||||||
All other | 1 | 0.20 | % | 0.19 | % | 0.20 | % | |||||||||
Total | 100 | % | 0.08 | % | 0.08 | % | 0.08 | % | ||||||||
Increase | ||||||||||||||||
(decrease) and | ||||||||||||||||
Three months ended | percentage | |||||||||||||||
June 30, | change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 62 | $ | 80 | $ | (18 | ) | (23 | )% | |||||||
Net investment income | 8 | 15 | (7 | ) | (47 | )% | ||||||||||
Net investment gains (losses) | 66 | 1 | 65 | NM | (1) | |||||||||||
Total revenues | 136 | 96 | 40 | 42 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 39 | 26 | 13 | 50 | % | |||||||||||
Acquisition and operating expenses, net of deferrals | 18 | 17 | 1 | 6 | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 6 | 9 | (3 | ) | (33 | )% | ||||||||||
Goodwill impairment | 5 | — | 5 | NM | (1) | |||||||||||
Interest expense | 2 | 2 | — | — | % | |||||||||||
Total benefits and expenses | 70 | 54 | 16 | 30 | % | |||||||||||
Income from continuing operations before income taxes | 66 | 42 | 24 | 57 | % | |||||||||||
Provision for income taxes | 20 | 13 | 7 | 54 | % | |||||||||||
Income from continuing operations | 46 | 29 | 17 | 59 | % | |||||||||||
Less: net income from continuing operations attributable to noncontrolling interests | 23 | 15 | 8 | 53 | % | |||||||||||
Income from continuing operations available to Genworth Financial, Inc.’s common stockholders | 23 | 14 | 9 | 64 | % | |||||||||||
Adjustments to income from continuing operations available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
Net investment (gains) losses, net (2) | (34 | ) | (1 | ) | (33 | ) | NM | (1) | ||||||||
Goodwill impairment (3) | 3 | — | 3 | NM | (1) | |||||||||||
Taxes on adjustments | 9 | — | 9 | NM | (1) | |||||||||||
Adjusted operating income available to Genworth Financial, Inc.’s common stockholders | $ | 1 | $ | 13 | $ | (12 | ) | (92 | )% | |||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
(2) | For the three months ended June 30, 2020, net investment (gains) losses were adjusted for the portion of net investment gains (losses) attributable to noncontrolling interests of $32 million. |
(3) | For the three months ended June 30, 2020, goodwill impairment was adjusted for the portion attributable to noncontrolling interests of $2 million. |
Three months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 80 | $ | 106 | $ | (26 | ) | (25 | )% | |||||||
Net investment income | 15 | 18 | (3 | ) | (17 | )% | ||||||||||
Net investment gains (losses) | 1 | 12 | (11 | ) | (92 | )% | ||||||||||
Total revenues | 96 | 136 | (40 | ) | (29 | )% | ||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 26 | 29 | (3 | ) | (10 | )% | ||||||||||
Acquisition and operating expenses, net of deferrals | 17 | 17 | — | — | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 9 | 12 | (3 | ) | (25 | )% | ||||||||||
Interest expense | 2 | 2 | — | — | % | |||||||||||
Total benefits and expenses | 54 | 60 | (6 | ) | (10 | )% | ||||||||||
Income before income taxes | 42 | 76 | (34 | ) | (45 | )% | ||||||||||
Provision for income taxes | 13 | 23 | (10 | ) | (43 | )% | ||||||||||
Net income | 29 | 53 | (24 | ) | (45 | )% | ||||||||||
Less: net income attributable to noncontrolling interests | 15 | 27 | (12 | ) | (44 | )% | ||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders | 14 | 26 | (12 | ) | (46 | )% | ||||||||||
Adjustments to net income available to Genworth Financial, Inc.’s | ||||||||||||||||
Net investment (gains) losses, net (1) | (1 | ) | (6 | ) | 5 | 83 | % | |||||||||
Taxes on adjustments | — | 2 | (2 | ) | (100 | )% | ||||||||||
Adjusted operating income available to Genworth Financial, Inc.’scommon stockholders | $ | 13 | $ | 22 | $ | (9 | ) | (41 | )% | |||||||
Increase | ||||||||||||||||
(decrease) and | ||||||||||||||||
Six months ended | percentage | |||||||||||||||
June 30, | change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 131 | $ | 163 | $ | (32 | ) | (20 | )% | |||||||
Net investment income | 18 | 31 | (13 | ) | (42 | )% | ||||||||||
Net investment gains (losses) | 13 | 13 | — | — | % | |||||||||||
Policy fees and other income | 1 | (1 | ) | 2 | 200 | % | ||||||||||
Total revenues | 163 | 206 | (43 | ) | (21 | )% | ||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 63 | 54 | 9 | 17 | % | |||||||||||
Acquisition and operating expenses, net of deferrals | 35 | 34 | 1 | 3 | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 14 | 18 | (4 | ) | (22 | )% | ||||||||||
Goodwill impairment | 5 | — | 5 | NM | (1) | |||||||||||
Interest expense | 3 | 4 | (1 | ) | (25 | )% | ||||||||||
Total benefits and expenses | 120 | 110 | 10 | 9 | % | |||||||||||
Income from continuing operations before income taxes | 43 | 96 | (53 | ) | (55 | )% | ||||||||||
Provision for income taxes | 13 | 29 | (16 | ) | (55 | )% | ||||||||||
Income from continuing operations | 30 | 67 | (37 | ) | (55 | )% | ||||||||||
Less: net income from continuing operations attributable to noncontrolling interests | 17 | 35 | (18 | ) | (51 | )% | ||||||||||
Income from continuing operations available to Genworth Financial, Inc.’s common stockholders | 13 | 32 | (19 | ) | (59 | )% | ||||||||||
Adjustments to income from continuing operations available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
Net investment (gains) losses, net (2) | (7 | ) | (7 | ) | — | — | % | |||||||||
Goodwill impairment (3) | 3 | — | 3 | NM | (1) | |||||||||||
Taxes on adjustments | 1 | 2 | (1 | ) | (50 | )% | ||||||||||
Adjusted operating income available to Genworth Financial, Inc.’s common stockholders | $ | 10 | $ | 27 | $ | (17 | ) | (63 | )% | |||||||
Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 163 | $ | 204 | $ | (41 | ) | (20 | )% | |||||||
Net investment income | 31 | 35 | (4 | ) | (11 | )% | ||||||||||
Net investment gains (losses) | 13 | 3 | 10 | NM | (1) | |||||||||||
Policy fees and other income | (1 | ) | 1 | (2 | ) | (200 | )% | |||||||||
Total revenues | 206 | 243 | (37 | ) | (15 | )% | ||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 54 | 59 | (5 | ) | (8 | )% | ||||||||||
Acquisition and operating expenses, net of deferrals | 34 | 34 | — | — | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 18 | 23 | (5 | ) | (22 | )% | ||||||||||
Interest expense | 4 | 4 | — | — | % | |||||||||||
Total benefits and expenses | 110 | 120 | (10 | ) | (8 | )% | ||||||||||
Income before income taxes | 96 | 123 | (27 | ) | (22 | )% | ||||||||||
Provision for income taxes | 29 | 37 | (8 | ) | (22 | )% | ||||||||||
Net income | 67 | 86 | (19 | ) | (22 | )% | ||||||||||
Less: net income attributable to noncontrolling interests | 35 | 44 | (9 | ) | (20 | )% | ||||||||||
Net income available to Genworth Financial, Inc.’scommon stockholders | 32 | 42 | (10 | ) | (24 | )% | ||||||||||
Adjustments to net income available to GenworthFinancial, Inc.’s common stockholders: | ||||||||||||||||
Net investment (gains) losses, net (2) | (7 | ) | (2 | ) | (5 | ) | NM | (1) | ||||||||
Taxes on adjustments | 2 | 1 | 1 | 100 | % | |||||||||||
Adjusted operating income available to Genworth Financial, Inc.’s commonstockholders | $ | 27 | $ | 41 | $ | (14 | ) | (34 | )% | |||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
(2) | For the six months ended June 30, |
(3) | For the six months ended June 30, 2020, goodwill impairment was adjusted for the portion attributable to noncontrolling interests of $2 million. |
As of June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Primary insurance in-force | $ | 215,600 | $ | 229,400 | $ | (13,800 | ) | (6 | )% | |||||||
Risk in-force | $ | 75,100 | $ | 79,900 | $ | (4,800 | ) | (6 | )% |
Increase | ||||||||||||||||
(decrease) and | ||||||||||||||||
As of June 30, | percentage change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Primary insurance in-force | $ | 210,200 | $ | 215,600 | $ | (5,400 | ) | (3 | )% | |||||||
Risk in-force | $ | 73,200 | $ | 75,100 | $ | (1,900 | ) | (3 | )% |
Three months ended June 30, | Increase (decrease) and percentage change | Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | 2019 | 2018 | 2019 vs. 2018 | ||||||||||||||||||||||||||
New insurance written | $ | 4,900 | $ | 4,600 | $ | 300 | 7 | % | $ | 8,800 | $ | 8,000 | $ | 800 | 10 | % | ||||||||||||||||
Net premiums written | $ | 58 | $ | 56 | $ | 2 | 4 | % | $ | 110 | $ | 116 | $ | (6 | ) | (5 | )% |
Increase | Increase | |||||||||||||||||||||||||||||||
(decrease) and | (decrease) and | |||||||||||||||||||||||||||||||
Three months ended | percentage | Six months ended | percentage | |||||||||||||||||||||||||||||
June 30, | change | June 30, | change | |||||||||||||||||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | 2020 | 2019 | 2020 vs. 2019 | ||||||||||||||||||||||||||
New insurance written | $ | 4,500 | $ | 4,900 | $ | (400) | (8) | % | $ | 8,800 | $ | 8,800 | $ | — | — | % | ||||||||||||||||
Net premiums written | $ | 70 | $ | 58 | $ | 12 | 21 | % | $ | 132 | $ | 110 | $ | 22 | 20 | % |
Three months ended June 30, | Increase (decrease) | Six months ended June 30, | Increase (decrease) | |||||||||||||||||||||
2019 | 2018 | 2019 vs. 2018 | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||||||||
Loss ratio | 34 | % | 28 | % | 6 | % | 34 | % | 29 | % | 5 | % | ||||||||||||
Expense ratio (net earned premiums) | 33 | % | 27 | % | 6 | % | 32 | % | 28 | % | 4 | % | ||||||||||||
Expense ratio (net premiums written) | 44 | % | 50 | % | (6 | )% | 47 | % | 48 | % | (1 | )% |
Three months ended June 30, | Increase (decrease) | Six months ended June 30, | Increase (decrease) | |||||||||||||||||||||
2020 | 2019 | 2020 vs. 2019 | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||||||||
Loss ratio | 63 | % | 34 | % | 29 | % | 48 | % | 34 | % | 14 | % | ||||||||||||
Expense ratio (net earned premiums) | 47 | % | 33 | % | 14 | % | 41 | % | 32 | % | 9 | % | ||||||||||||
Expense ratio (net premiums written) | 41 | % | 44 | % | (3 | )% | 41 | % | 47 | % | (6 | )% |
June 30, 2019 | December 31, 2018 | June 30, 2018 | ||||||||||
Primary insured loans in-force | 1,308,811 | 1,332,906 | 1,354,614 | |||||||||
Delinquent loans | 7,891 | 7,145 | 7,306 | |||||||||
Percentage of delinquent loans (delinquency rate) | 0.60 | % | 0.54 | % | 0.54 | % | ||||||
Flow loans in-force | 1,200,603 | 1,226,219 | 1,247,229 | |||||||||
Flow delinquent loans | 7,642 | 6,931 | 7,076 | |||||||||
Percentage of flow delinquent loans (delinquency rate) | 0.64 | % | 0.57 | % | 0.57 | % | ||||||
Bulk loans in-force | 108,208 | 106,687 | 107,385 | |||||||||
Bulk delinquent loans | 249 | 214 | 230 | |||||||||
Percentage of bulk delinquent loans (delinquency rate) | 0.23 | % | 0.20 | % | 0.21 | % |
June 30, 2020 | December 31, 2019 | June 30, 2019 | ||||||||||
Primary insured loans in-force | 1,236,657 | 1,290,216 | 1,308,811 | |||||||||
Delinquent loans | 7,614 | 7,221 | 7,891 | |||||||||
Percentage of delinquent loans (delinquency rate) | 0.62 | % | 0.56 | % | 0.60 | % | ||||||
Flow loans in-force | 1,137,784 | 1,189,019 | 1,200,603 | |||||||||
Flow delinquent loans | 7,380 | 7,003 | 7,642 | |||||||||
Percentage of flow delinquent loans (delinquency rate) | 0.65 | % | 0.59 | % | 0.64 | % | ||||||
Bulk loans in-force | 98,873 | 101,197 | 108,208 | |||||||||
Bulk delinquent loans | 234 | 218 | 249 | |||||||||
Percentage of bulk delinquent loans (delinquency rate) | 0.24 | % | 0.22 | % | 0.23 | % |
Percent of primary risk in-force as of June 30, 2019 | Delinquency rate | |||||||||||||||
June 30, 2019 | December 31, 2018 | June 30, 2018 | ||||||||||||||
By state and territory: | ||||||||||||||||
New South Wales | 27 | % | 0.45 | % | 0.38 | % | 0.37 | % | ||||||||
Queensland | 23 | 0.81 | % | 0.70 | % | 0.73 | % | |||||||||
Victoria | 23 | 0.45 | % | 0.40 | % | 0.42 | % | |||||||||
Western Australia | 13 | 1.10 | % | 0.98 | % | 0.99 | % | |||||||||
South Australia | 6 | 0.68 | % | 0.68 | % | 0.67 | % | |||||||||
Australian Capital Territory | 3 | 0.25 | % | 0.17 | % | 0.18 | % | |||||||||
Tasmania | 2 | 0.31 | % | 0.31 | % | 0.34 | % | |||||||||
New Zealand | 2 | 0.02 | % | 0.05 | % | 0.06 | % | |||||||||
Northern Territory | 1 | 0.83 | % | 0.68 | % | 0.61 | % | |||||||||
Total | 100 | % | 0.60 | % | 0.54 | % | 0.54 | % | ||||||||
Percent of primary risk in-force as of June 30, 2020 | Delinquency rate | |||||||||||||||
June 30, | December 31, | June 30, | ||||||||||||||
2020 | 2019 | 2019 | ||||||||||||||
By state and territory: | ||||||||||||||||
New South Wales | 27 | % | 0.51 | % | 0.42 | % | 0.45 | % | ||||||||
Queensland | 23 | 0.78 | % | 0.75 | % | 0.81 | % | |||||||||
Victoria | 23 | 0.46 | % | 0.41 | % | 0.45 | % | |||||||||
Western Australia | 13 | 1.06 | % | 1.00 | % | 1.10 | % | |||||||||
South Australia | 6 | 0.70 | % | 0.65 | % | 0.68 | % | |||||||||
Australian Capital Territory | 3 | 0.27 | % | 0.24 | % | 0.25 | % | |||||||||
Tasmania | 2 | 0.27 | % | 0.29 | % | 0.31 | % | |||||||||
New Zealand | 2 | 0.03 | % | 0.02 | % | 0.02 | % | |||||||||
Northern Territory | 1 | 0.87 | % | 0.71 | % | 0.83 | % | |||||||||
Total | 100 | % | 0.62 | % | 0.56 | % | 0.60 | % | ||||||||
Three months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 713 | $ | 712 | $ | 1 | — | % | ||||||||
Net investment income | 724 | 707 | 17 | 2 | % | |||||||||||
Net investment gains (losses) | (36 | ) | (10 | ) | (26 | ) | NM | (1) | ||||||||
Policy fees and other income | 187 | 169 | 18 | 11 | % | |||||||||||
Total revenues | 1,588 | 1,578 | 10 | 1 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 1,211 | 1,163 | 48 | 4 | % | |||||||||||
Interest credited | 106 | 116 | (10 | ) | (9 | )% | ||||||||||
Acquisition and operating expenses, net of deferrals | 142 | 146 | (4 | ) | (3 | )% | ||||||||||
Amortization of deferred acquisition costs and intangibles | 67 | 78 | (11 | ) | (14 | )% | ||||||||||
Interest expense | 4 | 4 | — | — | % | |||||||||||
Total benefits and expenses | 1,530 | 1,507 | 23 | 2 | % | |||||||||||
Income before income taxes | 58 | 71 | (13 | ) | (18 | )% | ||||||||||
Provision for income taxes | 19 | 21 | (2 | ) | (10 | )% | ||||||||||
Net income | 39 | 50 | (11 | ) | (22 | )% | ||||||||||
Adjustments to net income: | ||||||||||||||||
Net investment (gains) losses, net (2) | 35 | 9 | 26 | NM | (1) | |||||||||||
Expenses related to restructuring | (1 | ) | — | (1 | ) | NM | (1) | |||||||||
Taxes on adjustments | (7 | ) | (2 | ) | (5 | ) | NM | (1) | ||||||||
Adjusted operating income available to Genworth Financial, Inc.’scommon stockholders | $ | 66 | $ | 57 | $ | 9 | 16 | % | ||||||||
Increase | ||||||||||||||||
(decrease) and | ||||||||||||||||
Three months ended | percentage | |||||||||||||||
June 30, | change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 712 | $ | 713 | $ | (1 | ) | — | % | |||||||
Net investment income | 692 | 724 | (32 | ) | (4 | )% | ||||||||||
Net investment gains (losses) | 118 | (36 | ) | 154 | NM | (1) | ||||||||||
Policy fees and other income | 142 | 187 | (45 | ) | (24 | )% | ||||||||||
Total revenues | 1,664 | 1,588 | 76 | 5 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 1,213 | 1,211 | 2 | — | % | |||||||||||
Interest credited | 97 | 106 | (9 | ) | (8 | )% | ||||||||||
Acquisition and operating expenses, net of deferrals | 147 | 142 | 5 | 4 | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 83 | 67 | 16 | 24 | % | |||||||||||
Interest expense | — | 4 | (4 | ) | (100 | )% | ||||||||||
Total benefits and expenses | 1,540 | 1,530 | 10 | 1 | % | |||||||||||
Income from continuing operations before income taxes | 124 | 58 | 66 | 114 | % | |||||||||||
Provision for income taxes | 33 | 19 | 14 | 74 | % | |||||||||||
Income from continuing operations | 91 | 39 | 52 | 133 | % | |||||||||||
Adjustments to income from continuing operations: | ||||||||||||||||
Net investment (gains) losses, net (2) | (121 | ) | 35 | (156 | ) | NM | (1) | |||||||||
Expenses related to restructuring | — | (1 | ) | 1 | 100 | % | ||||||||||
Taxes on adjustments | 25 | (7 | ) | 32 | NM | (1) | ||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (5 | ) | $ | 66 | $ | (71 | ) | (108 | )% | ||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
(2) | For the three months ended June 30, |
Three months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Adjusted operating income available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
Long-term care insurance | $ | 37 | $ | 22 | $ | 15 | 68 | % | ||||||||
Life insurance | 10 | 4 | 6 | 150 | % | |||||||||||
Fixed annuities | 19 | 31 | (12 | ) | (39 | )% | ||||||||||
Total adjusted operating income available to Genworth Financial, Inc.’s common stockholders | $ | 66 | $ | 57 | $ | 9 | 16 | % | ||||||||
Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 1,422 | $ | 1,434 | $ | (12 | ) | (1 | )% | |||||||
Net investment income | 1,425 | 1,395 | 30 | 2 | % | |||||||||||
Net investment gains (losses) | 48 | (2 | ) | 50 | NM | (1) | ||||||||||
Policy fees and other income | 338 | 332 | 6 | 2 | % | |||||||||||
Total revenues | 3,233 | 3,159 | 74 | 2 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 2,447 | 2,401 | 46 | 2 | % | |||||||||||
Interest credited | 212 | 235 | (23 | ) | (10 | )% | ||||||||||
Acquisition and operating expenses, net of deferrals | 290 | 287 | 3 | 1 | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 133 | 149 | (16 | ) | (11 | )% | ||||||||||
Interest expense | 9 | 8 | 1 | 13 | % | |||||||||||
Total benefits and expenses | 3,091 | 3,080 | 11 | — | % | |||||||||||
Income before income taxes | 142 | 79 | 63 | 80 | % | |||||||||||
Provision for income taxes | 43 | 27 | 16 | 59 | % | |||||||||||
Net income | 99 | 52 | 47 | 90 | % | |||||||||||
Adjustments to net income: | ||||||||||||||||
Net investment (gains) losses, net (2) | (51 | ) | — | (51 | ) | NM | (1) | |||||||||
Expenses related to restructuring | 3 | — | 3 | NM | (1) | |||||||||||
Taxes on adjustments | 10 | — | 10 | NM | (1) | |||||||||||
Adjusted operating income available to Genworth Financial,Inc.’s common stockholders | $ | 61 | $ | 52 | $ | 9 | 17 | % | ||||||||
Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
Long-term care insurance | $ | 17 | $ | (10 | ) | $ | 27 | NM | (1) | |||||||
Life insurance | 8 | 3 | 5 | 167 | % | |||||||||||
Fixed annuities | 36 | 59 | (23 | ) | (39 | )% | ||||||||||
Total adjusted operating income available to Genworth Financial, Inc.’s common stockholders | $ | 61 | $ | 52 | $ | 9 | 17 | % | ||||||||
Increase | ||||||||||||||||
(decrease) and | ||||||||||||||||
Three months ended | percentage | |||||||||||||||
June 30, | change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
Long-term care insurance | $ | 48 | $ | 37 | $ | 11 | 30 | % | ||||||||
Life insurance | (81 | ) | 10 | (91 | ) | NM | (1) | |||||||||
Fixed annuities | 28 | 19 | 9 | 47 | % | |||||||||||
Total adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (5 | ) | $ | 66 | $ | (71 | ) | (108 | )% | ||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
Increase | ||||||||||||||||
(decrease) and | ||||||||||||||||
Six months ended | percentage | |||||||||||||||
June 30, | change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 1,430 | $ | 1,422 | $ | 8 | 1 | % | ||||||||
Net investment income | 1,387 | 1,425 | (38 | ) | (3 | )% | ||||||||||
Net investment gains (losses) | 48 | 48 | — | — | % | |||||||||||
Policy fees and other income | 286 | 338 | (52 | ) | (15 | )% | ||||||||||
Total revenues | 3,151 | 3,233 | (82 | ) | (3 | )%�� | ||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 2,510 | 2,447 | 63 | 3 | % | |||||||||||
Interest credited | 197 | 212 | (15 | ) | (7 | )% | ||||||||||
Acquisition and operating expenses, net of deferrals | 298 | 290 | 8 | 3 | % | |||||||||||
Amortization of deferred acquisition costs and intangibles | 170 | 133 | 37 | 28 | % | |||||||||||
Interest expense | 5 | 9 | (4 | ) | (44 | )% | ||||||||||
Total benefits and expenses | 3,180 | 3,091 | 89 | 3 | % | |||||||||||
Income (loss) from continuing operations before income taxes | (29 | ) | 142 | (171 | ) | (120 | )% | |||||||||
Provision for income taxes | 6 | 43 | (37 | ) | (86 | )% | ||||||||||
Income (loss) from continuing operations | (35 | ) | 99 | (134 | ) | (135 | )% | |||||||||
Adjustments to income (loss) from continuing operations: | ||||||||||||||||
Net investment (gains) losses, net (2) | (54 | ) | (51 | ) | (3 | ) | (6 | )% | ||||||||
(Gains) losses on early extinguishment of debt | 4 | — | 4 | NM | (1) | |||||||||||
Expenses related to restructuring | — | 3 | (3 | ) | (100 | )% | ||||||||||
Taxes on adjustments | 10 | 10 | — | — | % | |||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (75 | ) | $ | 61 | $ | (136 | ) | NM | (1) | ||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
(2) | For the six months ended June 30, 2020 and 2019, net investment (gains) losses were adjusted for DAC and other intangible amortization and certain benefit reserves of $(6) million and $(3) million, respectively. |
Increase | ||||||||||||||||
(decrease) and | ||||||||||||||||
Six months ended | percentage | |||||||||||||||
June 30, | change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders: | ||||||||||||||||
Long-term care insurance | $ | 49 | $ | 17 | $ | 32 | 188 | % | ||||||||
Life insurance | (158 | ) | 8 | (166 | ) | NM | (1) | |||||||||
Fixed annuities | 34 | 36 | (2 | ) | (6 | )% | ||||||||||
Total adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (75 | ) | $ | 61 | $ | (136 | ) | NM | (1) | ||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
Three months ended June 30, | Increase (decrease) and percentage change | Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | 2019 | 2018 | 2019 vs. 2018 | ||||||||||||||||||||||||||
Net earned premiums: | ||||||||||||||||||||||||||||||||
Individual long-term care insurance | $ | 610 | $ | 604 | $ | 6 | 1 | % | $ | 1,209 | $ | 1,207 | $ | 2 | — | % | ||||||||||||||||
Group long-term care insurance | 30 | 28 | 2 | 7 | % | 59 | 56 | 3 | 5 | % | ||||||||||||||||||||||
Total | $ | 640 | $ | 632 | $ | 8 | 1 | % | $ | 1,268 | $ | 1,263 | $ | 5 | — | % | ||||||||||||||||
Loss ratio | 74 | % | 75 | % | (1 | )% | 78 | % | 79 | % | (1 | )% |
Increase | Increase | |||||||||||||||||||||||||||||||
(decrease) and | (decrease) and | |||||||||||||||||||||||||||||||
Three months ended | percentage | Six months ended | percentage | |||||||||||||||||||||||||||||
June 30, | change | June 30, | change | |||||||||||||||||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | 2020 | 2019 | 2020 vs. 2019 | ||||||||||||||||||||||||||
Net earned premiums: | ||||||||||||||||||||||||||||||||
Individual long-term care insurance | $ | 618 | $ | 610 | $ | 8 | 1 | % | $ | 1,229 | $ | 1,209 | $ | 20 | 2 | % | ||||||||||||||||
Group long-term care insurance | 31 | 30 | 1 | 3 | % | 62 | 59 | 3 | 5 | % | ||||||||||||||||||||||
Total | $ | 649 | $ | 640 | $ | 9 | 1 | % | $ | 1,291 | $ | 1,268 | $ | 23 | 2 | % | ||||||||||||||||
Loss ratio | 69 | % | 74 | % | (5 | )% | 74 | % | 78 | % | (4 | )% |
Three months ended June 30, | Increase (decrease) and percentage change | Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | 2019 | 2018 | 2019 vs. 2018 | ||||||||||||||||||||||||||
Term and whole life insurance | ||||||||||||||||||||||||||||||||
Net earned premiums | $ | 73 | $ | 80 | $ | (7 | ) | (9 | )% | $ | 154 | $ | 171 | $ | (17 | ) | (10 | )% | ||||||||||||||
Term universal life insurance | ||||||||||||||||||||||||||||||||
Net deposits | 59 | 61 | (2 | ) | (3 | )% | 117 | 122 | (5 | ) | (4 | )% | ||||||||||||||||||||
Universal life insurance | ||||||||||||||||||||||||||||||||
Net deposits | 141 | 126 | 15 | 12 | % | 217 | 258 | (41 | ) | (16 | )% | |||||||||||||||||||||
Total life insurance | ||||||||||||||||||||||||||||||||
Net earned premiums and deposits | $ | 273 | $ | 267 | $ | 6 | 2 | % | $ | 488 | $ | 551 | $ | (63 | ) | (11 | )% | |||||||||||||||
Increase | Increase | |||||||||||||||||||||||||||||||
(decrease) and | (decrease) and | |||||||||||||||||||||||||||||||
Three months | percentage | Six months | percentage | |||||||||||||||||||||||||||||
ended June 30, | change | ended June 30, | change | |||||||||||||||||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | 2020 | 2019 | 2020 vs. 2019 | ||||||||||||||||||||||||||
Term and whole life insurance | ||||||||||||||||||||||||||||||||
Net earned premiums | $ | 63 | $ | 73 | $ | (10 | ) | (14 | )% | $ | 139 | $ | 154 | $ | (15 | ) | (10 | )% | ||||||||||||||
Term universal life insurance | ||||||||||||||||||||||||||||||||
Net deposits | $ | 57 | $ | 59 | $ | (2 | ) | (3 | )% | $ | 113 | $ | 117 | $ | (4 | ) | (3 | )% | ||||||||||||||
Universal life insurance | ||||||||||||||||||||||||||||||||
Net deposits | $ | 65 | $ | 141 | $ | (76 | ) | (54 | )% | $ | 136 | $ | 217 | $ | (81 | ) | (37 | )% | ||||||||||||||
Total life insurance | ||||||||||||||||||||||||||||||||
Net earned premiums and deposits | $ | 185 | $ | 273 | $ | (88 | ) | (32 | )% | $ | 388 | $ | 488 | $ | (100 | ) | (20 | )% | ||||||||||||||
As of June 30, | Percentage change | |||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||
Term and whole life insurance | ||||||||||||
Life insurance in-force, net of reinsurance | $ | 91,386 | $ | 100,475 | (9 | )% | ||||||
Life insurance in-force before reinsurance | $ | 419,246 | $ | 447,429 | (6 | )% | ||||||
Term universal life insurance | ||||||||||||
Life insurance in-force, net of reinsurance | $ | 114,214 | $ | 117,141 | (2 | )% | ||||||
Life insurance in-force before reinsurance | $ | 114,999 | $ | 117,957 | (3 | )% | ||||||
Universal life insurance | ||||||||||||
Life insurance in-force, net of reinsurance | $ | 34,581 | $ | 36,054 | (4 | )% | ||||||
Life insurance in-force before reinsurance | $ | 39,357 | $ | 41,136 | (4 | )% | ||||||
Total life insurance | ||||||||||||
Life insurance in-force, net of reinsurance | $ | 240,181 | $ | 253,670 | (5 | )% | ||||||
Life insurance in-force before reinsurance | $ | 573,602 | $ | 606,522 | (5 | )% |
Percentage | ||||||||||||
As of June 30, | change | |||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||
Term and whole life insurance | ||||||||||||
Life insurance in-force, net of reinsurance | $ | 69,969 | $ | 91,386 | (23 | )% | ||||||
Life insurance in-force before reinsurance | $ | 379,972 | $ | 419,246 | (9 | )% | ||||||
Term universal life insurance | ||||||||||||
Life insurance in-force, net of reinsurance | $ | 110,705 | $ | 114,214 | (3 | )% | ||||||
Life insurance in-force before reinsurance | $ | 111,465 | $ | 114,999 | (3 | )% | ||||||
Universal life insurance | ||||||||||||
Life insurance in-force, net of reinsurance | $ | 33,212 | $ | 34,581 | (4 | )% | ||||||
Life insurance in-force before reinsurance | $ | 37,753 | $ | 39,357 | (4 | )% | ||||||
Total life insurance | ||||||||||||
Life insurance in-force, net of reinsurance | $ | 213,886 | $ | 240,181 | (11 | )% | ||||||
Life insurance in-force before reinsurance | $ | 529,190 | $ | 573,602 | (8 | )% |
As of or for the three months ended June 30, | As of or for the six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Account value, beginning of period | $ | 14,109 | $ | 15,881 | $ | 14,348 | $ | 16,401 | ||||||||
Premiums and deposits | 16 | 22 | 45 | 44 | ||||||||||||
Surrenders, benefits and product charges | (486 | ) | (593 | ) | (1,002 | ) | (1,129 | ) | ||||||||
Net flows | (470 | ) | (571 | ) | (957 | ) | (1,085 | ) | ||||||||
Interest credited and investment performance | 119 | 128 | 261 | 234 | ||||||||||||
Effect of accumulated net unrealized investment gains (losses) | 117 | (66 | ) | 223 | (178 | ) | ||||||||||
Account value, end of period | $ | 13,875 | $ | 15,372 | $ | 13,875 | $ | 15,372 | ||||||||
As of or for the three | As of or for the six | |||||||||||||||
months ended June 30, | months ended June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Account value, beginning of period | $ | 12,487 | $ | 14,109 | $ | 13,023 | $ | 14,348 | ||||||||
Premiums and deposits | 17 | 16 | 39 | 45 | ||||||||||||
Surrenders, benefits and product charges | (375 | ) | (486 | ) | (842 | ) | (1,002 | ) | ||||||||
Net flows | (358 | ) | (470 | ) | (803 | ) | (957 | ) | ||||||||
Interest credited and investment performance | 134 | 119 | 195 | 261 | ||||||||||||
Effect of accumulated net unrealized investment gains (losses) | (7 | ) | 117 | (159 | ) | 223 | ||||||||||
Account value, end of period | $ | 12,256 | $ | 13,875 | $ | 12,256 | $ | 13,875 | ||||||||
Three months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Net investment income | $ | 47 | $ | 43 | $ | 4 | 9 | % | ||||||||
Net investment gains (losses) | (4 | ) | (1 | ) | (3 | ) | NM | (1) | ||||||||
Policy fees and other income | 35 | 38 | (3 | ) | (8 | )% | ||||||||||
Total revenues | 78 | 80 | (2 | ) | (3 | )% | ||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 13 | 7 | 6 | 86 | % | |||||||||||
Interest credited | 40 | 36 | 4 | 11 | % | |||||||||||
Acquisition and operating expenses, net of deferrals | 13 | 14 | (1 | ) | (7 | )% | ||||||||||
Amortization of deferred acquisition costs and intangibles | 4 | 8 | (4 | ) | (50 | )% | ||||||||||
Total benefits and expenses | 70 | 65 | 5 | 8 | % | |||||||||||
Income before income taxes | 8 | 15 | (7 | ) | (47 | )% | ||||||||||
Provision for income taxes | 1 | 3 | (2 | ) | (67 | )% | ||||||||||
Net income | 7 | 12 | (5 | ) | (42 | )% | ||||||||||
Adjustments to net income: | ||||||||||||||||
Net investment (gains) losses, net (2) | 2 | 1 | 1 | 100 | % | |||||||||||
Taxes on adjustments | — | — | — | — | % | |||||||||||
Adjusted operating income available to Genworth Financial, Inc.’scommon stockholders | $ | 9 | $ | 13 | $ | (4 | ) | (31 | )% | |||||||
Increase | ||||||||||||||||
(decrease) and | ||||||||||||||||
Three months ended | percentage | |||||||||||||||
June 30, | change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Net investment income | $ | 54 | $ | 47 | $ | 7 | 15 | % | ||||||||
Net investment gains (losses) | 4 | (4 | ) | 8 | 200 | % | ||||||||||
Policy fees and other income | 32 | 35 | (3 | ) | (9 | )% | ||||||||||
Total revenues | 90 | 78 | 12 | 15 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 4 | 13 | (9 | ) | (69 | )% | ||||||||||
Interest credited | 42 | 40 | 2 | 5 | % | |||||||||||
Acquisition and operating expenses, net of deferrals | 11 | 13 | (2 | ) | (15 | )% | ||||||||||
Amortization of deferred acquisition costs and intangibles | (1 | ) | 4 | (5 | ) | (125 | )% | |||||||||
Total benefits and expenses | 56 | 70 | (14 | ) | (20 | )% | ||||||||||
Income from continuing operations before income taxes | 34 | 8 | 26 | NM | (1) | |||||||||||
Provision for income taxes | 6 | 1 | 5 | NM | (1) | |||||||||||
Income from continuing operations | 28 | 7 | 21 | NM | (1) | |||||||||||
Adjustments to income from continuing operations: | ||||||||||||||||
Net investment (gains) losses, net (2) | (5 | ) | 2 | (7 | ) | NM | (1) | |||||||||
Taxes on adjustments | 1 | — | 1 | NM | (1) | |||||||||||
Adjusted operating income available to Genworth Financial, Inc.’s common stockholders | $ | 24 | $ | 9 | $ | 15 | 167 | % | ||||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
(2) | For the three months ended June 30, 2020 and 2019, net investment (gains) losses were adjusted for DAC and other intangible amortization and certain benefit reserves of $(1) million and $(2) |
Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Net investment income | $ | 94 | $ | 85 | $ | 9 | 11 | % | ||||||||
Net investment gains (losses) | (4 | ) | (15 | ) | 11 | 73 | % | |||||||||
Policy fees and other income | 70 | 78 | (8 | ) | (10 | )% | ||||||||||
Total revenues | 160 | 148 | 12 | 8 | % | |||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 14 | 15 | (1 | ) | (7 | )% | ||||||||||
Interest credited | 81 | 73 | 8 | 11 | % | |||||||||||
Acquisition and operating expenses, net of deferrals | 26 | 29 | (3 | ) | (10 | )% | ||||||||||
Amortization of deferred acquisition costs and intangibles | 6 | 15 | (9 | ) | (60 | )% | ||||||||||
Total benefits and expenses | 127 | 132 | (5 | ) | (4 | )% | ||||||||||
Income before income taxes | 33 | 16 | 17 | 106 | % | |||||||||||
Provision for income taxes | 6 | 3 | 3 | 100 | % | |||||||||||
Net income | 27 | 13 | 14 | 108 | % | |||||||||||
Adjustments to net income: | ||||||||||||||||
Net investment (gains) losses, net (1) | 2 | 13 | (11 | ) | (85 | )% | ||||||||||
Taxes on adjustments | — | (3 | ) | 3 | 100 | % | ||||||||||
Adjusted operating income available to Genworth Financial, Inc.’scommon stockholders | $ | 29 | $ | 23 | $ | 6 | 26 | % | ||||||||
Increase | ||||||||||||||||
(decrease) and | ||||||||||||||||
Six months ended | percentage | |||||||||||||||
June 30, | change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Net investment income | $ | 103 | $ | 94 | $ | 9 | 10 | % | ||||||||
Net investment gains (losses) | (71 | ) | (4 | ) | (67 | ) | NM | (1) | ||||||||
Policy fees and other income | 65 | 70 | (5 | ) | (7 | )% | ||||||||||
Total revenues | 97 | 160 | (63 | ) | (39 | )% | ||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 24 | 14 | 10 | 71 | % | |||||||||||
Interest credited | 83 | 81 | 2 | 2 | % | |||||||||||
Acquisition and operating expenses, net of deferrals | 24 | 26 | (2 | ) | (8 | )% | ||||||||||
Amortization of deferred acquisition costs and intangibles | 16 | 6 | 10 | 167 | % | |||||||||||
Total benefits and expenses | 147 | 127 | 20 | 16 | % | |||||||||||
Income (loss) from continuing operations before income taxes | (50 | ) | 33 | (83 | ) | NM | (1) | |||||||||
Provision (benefit) for income taxes | (12 | ) | 6 | (18 | ) | NM | (1) | |||||||||
Income (loss) from continuing operations | (38 | ) | 27 | (65 | ) | NM | (1) | |||||||||
Adjustments to income (loss) from continuing operations: | ||||||||||||||||
Net investment (gains) losses, net (2) | 62 | 2 | 60 | NM | (1) | |||||||||||
Taxes on adjustments | (13 | ) | — | (13 | ) | NM | (1) | |||||||||
Adjusted operating income available to Genworth Financial, Inc.’s common stockholders | $ | 11 | $ | 29 | $ | (18 | ) | (62 | )% | |||||||
(1) |
(2) | For the six months ended June 30, |
As of or for the three months ended June 30, | As of or for the six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Account value, beginning of period | $ | 5,113 | $ | 5,619 | $ | 4,918 | $ | 5,884 | ||||||||
Deposits | 6 | 5 | 13 | 12 | ||||||||||||
Surrenders, benefits and product charges | (158 | ) | (203 | ) | (319 | ) | (411 | ) | ||||||||
Net flows | (152 | ) | (198 | ) | (306 | ) | (399 | ) | ||||||||
Interest credited and investment performance | 160 | 48 | 509 | (16 | ) | |||||||||||
Account value, end of period | $ | 5,121 | $ | 5,469 | $ | 5,121 | $ | 5,469 | ||||||||
As of or for the three | As of or for the six | |||||||||||||||
months ended June 30, | months ended June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Account value, beginning of period | $ | 4,521 | $ | 5,113 | $ | 5,042 | $ | 4,918 | ||||||||
Deposits | 6 | 6 | 10 | 13 | ||||||||||||
Surrenders, benefits and product charges | (122 | ) | (158 | ) | (288 | ) | (319 | ) | ||||||||
Net flows | (116 | ) | (152 | ) | (278 | ) | (306 | ) | ||||||||
Interest credited and investment performance | 377 | 160 | 18 | 509 | ||||||||||||
Account value, end of period | $ | 4,782 | $ | 5,121 | $ | 4,782 | $ | 5,121 | ||||||||
As of or for the three months ended June 30, | As of or for the six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
FABNs (1) and Funding Agreements | ||||||||||||||||
Account value, beginning of period | $ | 305 | $ | 185 | $ | 381 | $ | 260 | ||||||||
Surrenders and benefits | (2 | ) | (6 | ) | (80 | ) | (82 | ) | ||||||||
Net flows | (2 | ) | (6 | ) | (80 | ) | (82 | ) | ||||||||
Interest credited | 2 | 1 | 4 | 2 | ||||||||||||
Account value, end of period | $ | 305 | $ | 180 | $ | 305 | $ | 180 | ||||||||
As of or for the three | As of or for the six | |||||||||||||||
months ended June 30, | months ended June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Funding Agreements | ||||||||||||||||
Account value, beginning of period | $ | 253 | $ | 305 | $ | 253 | $ | 381 | ||||||||
Deposits | 150 | — | 150 | — | ||||||||||||
Surrenders and benefits | (51 | ) | (2 | ) | (52 | ) | (80 | ) | ||||||||
Net flows | 99 | (2 | ) | 98 | (80 | ) | ||||||||||
Interest credited | 1 | 2 | 2 | 4 | ||||||||||||
Account value, end of period | $ | 353 | $ | 305 | $ | 353 | $ | 305 | ||||||||
Three months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 2 | $ | 3 | $ | (1 | ) | (33 | )% | |||||||
Net investment income | 3 | 3 | — | — | % | |||||||||||
Net investment gains (losses) | (7 | ) | — | (7 | ) | NM | (1) | |||||||||
Policy fees and other income | — | 1 | (1 | ) | (100 | )% | ||||||||||
Total revenues | (2 | ) | 7 | (9 | ) | (129 | )% | |||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 1 | 1 | — | — | % | |||||||||||
Acquisition and operating expenses, net of deferrals | 9 | 11 | (2 | ) | (18 | )% | ||||||||||
Interest expense | 62 | 67 | (5 | ) | (7 | )% | ||||||||||
Total benefits and expenses | 72 | 79 | (7 | ) | (9 | )% | ||||||||||
Loss before income taxes | (74 | ) | (72 | ) | (2 | ) | (3 | )% | ||||||||
Provision for income taxes | 5 | 3 | 2 | 67 | % | |||||||||||
Net loss | (79 | ) | (75 | ) | (4 | ) | (5 | )% | ||||||||
Adjustments to net loss: | ||||||||||||||||
Net investment (gains) losses | 7 | — | 7 | NM | (1) | |||||||||||
Expenses related to restructuring | 1 | — | 1 | NM | (1) | |||||||||||
Taxes on adjustments | (1 | ) | — | (1 | ) | NM | (1) | |||||||||
Adjusted operating loss available to Genworth Financial, Inc.’s common stockholders | $ | (72 | ) | $ | (75 | ) | $ | 3 | 4 | % | ||||||
Increase | ||||||||||||||||
(decrease) and | ||||||||||||||||
Three months ended | percentage | |||||||||||||||
June 30, | change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 2 | $ | 2 | $ | — | — | % | ||||||||
Net investment income | 1 | 2 | (1 | ) | (50 | )% | ||||||||||
Net investment gains (losses) | (28 | ) | (7 | ) | (21 | ) | NM | (1) | ||||||||
Policy fees and other income | (1 | ) | — | (1 | ) | NM | (1) | |||||||||
Total revenues | (26 | ) | (3 | ) | (23 | ) | NM | (1) | ||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 2 | 1 | 1 | 100 | % | |||||||||||
Acquisition and operating expenses, net of deferrals | — | 13 | (13 | ) | (100 | )% | ||||||||||
Amortization of deferred acquisition costs and intangibles | 1 | — | 1 | NM | (1) | |||||||||||
Interest expense | 42 | 54 | (12 | ) | (22 | )% | ||||||||||
Total benefits and expenses | 45 | 68 | (23 | ) | (34 | )% | ||||||||||
Loss from continuing operations before income taxes | (71 | ) | (71 | ) | — | — | % | |||||||||
Benefit for income taxes | (12 | ) | (7 | ) | (5 | ) | (71 | )% | ||||||||
Loss from continuing operations | (59 | ) | (64 | ) | 5 | 8 | % | |||||||||
Adjustments to loss from continuing operations: | ||||||||||||||||
Net investment (gains) losses | 28 | 7 | 21 | NM | (1) | |||||||||||
(Gains) losses on early extinguishment of debt | (3 | ) | — | (3 | ) | NM | (1) | |||||||||
Expenses related to restructuring | 1 | 1 | — | — | % | |||||||||||
Taxes on adjustments | (5 | ) | (1 | ) | (4 | ) | NM | (1) | ||||||||
Adjusted operating loss available to Genworth Financial, Inc.’s common stockholders | $ | (38 | ) | $ | (57 | ) | $ | 19 | 33 | % | ||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
Increase | ||||||||||||||||
(decrease) and | ||||||||||||||||
Six months ended | percentage | |||||||||||||||
June 30, | change | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 vs. 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 4 | $ | 4 | $ | — | — | % | ||||||||
Net investment income | 7 | 4 | 3 | 75 | % | |||||||||||
Net investment gains (losses) | 18 | (28 | ) | 46 | 164 | % | ||||||||||
Policy fees and other income | — | 1 | (1 | ) | (100 | )% | ||||||||||
Total revenues | 29 | (19 | ) | 48 | NM | (1) | ||||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 3 | 2 | 1 | 50 | % | |||||||||||
Acquisition and operating expenses, net of deferrals | 18 | 26 | (8 | ) | (31 | )% | ||||||||||
Amortization of deferred acquisition costs and intangibles | 1 | — | 1 | NM | (1) | |||||||||||
Interest expense | 88 | 107 | (19 | ) | (18 | )% | ||||||||||
Total benefits and expenses | 110 | 135 | (25 | ) | (19 | )% | ||||||||||
Loss from continuing operations before income taxes | (81 | ) | (154 | ) | 73 | 47 | % | |||||||||
Benefit for income taxes | (10 | ) | (16 | ) | 6 | 38 | % | |||||||||
Loss from continuing operations | (71 | ) | (138 | ) | 67 | 49 | % | |||||||||
Adjustments to loss from continuing operations: | ||||||||||||||||
Net investment (gains) losses | (18 | ) | 28 | (46 | ) | (164 | )% | |||||||||
(Gains) losses on early extinguishment of debt | 5 | — | 5 | NM | (1) | |||||||||||
Expenses related to restructuring | 2 | 1 | 1 | 100 | % | |||||||||||
Taxes on adjustments | 3 | (6 | ) | 9 | 150 | % | ||||||||||
Adjusted operating loss available to Genworth Financial, Inc.’s common stockholders | $ | (79 | ) | $ | (115 | ) | $ | 36 | 31 | % | ||||||
(1) | We define “NM” as not meaningful for increases or decreases greater than 200%. |
Six months ended June 30, | Increase (decrease) and percentage change | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 vs. 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Premiums | $ | 4 | $ | 5 | $ | (1 | ) | (20 | )% | |||||||
Net investment income | 6 | 5 | 1 | 20 | % | |||||||||||
Net investment gains (losses) | (28 | ) | (1 | ) | (27 | ) | NM | (1) | ||||||||
Policy fees and other income | 1 | (1 | ) | 2 | 200 | % | ||||||||||
Total revenues | (17 | ) | 8 | (25 | ) | NM | (1) | |||||||||
Benefits and expenses: | ||||||||||||||||
Benefits and other changes in policy reserves | 2 | 2 | — | — | % | |||||||||||
Acquisition and operating expenses, net of deferrals | 16 | 22 | (6 | ) | (27 | )% | ||||||||||
Amortization of deferred acquisition costs and intangibles | — | 1 | (1 | ) | (100 | )% | ||||||||||
Interest expense | 123 | 132 | (9 | ) | (7 | )% | ||||||||||
Total benefits and expenses | 141 | 157 | (16 | ) | (10 | )% | ||||||||||
Loss before income taxes | (158 | ) | (149 | ) | (9 | ) | (6 | )% | ||||||||
Provision (benefit) for income taxes | 10 | (14 | ) | 24 | 171 | % | ||||||||||
Net loss | (168 | ) | (135 | ) | (33 | ) | (24 | )% | ||||||||
Adjustments to net loss: | ||||||||||||||||
Net investment (gains) losses | 28 | 1 | 27 | NM | (1) | |||||||||||
Expenses related to restructuring | 1 | — | 1 | NM | (1) | |||||||||||
Taxes on adjustments | (6 | ) | — | (6 | ) | NM | (1) | |||||||||
Adjusted operating loss available to Genworth Financial, Inc.’s common stockholders | $ | (145 | ) | $ | (134 | ) | $ | (11 | ) | (8 | )% | |||||
Three months ended June 30, | Increase (decrease) | |||||||||||||||||||||||
2019 | 2018 | 2019 vs. 2018 | ||||||||||||||||||||||
(Amounts in millions) | Yield | Amount | Yield | Amount | Yield | Amount | ||||||||||||||||||
Fixed maturity securities—taxable | 4.6 | % | $ | 665 | 4.5 | % | $ | 651 | 0.1 | % | $ | 14 | ||||||||||||
Fixed maturity securities—non-taxable | 6.1 | % | 2 | 3.8 | % | 3 | 2.3 | % | (1 | ) | ||||||||||||||
Equity securities | 6.3 | % | 10 | 5.1 | % | 10 | 1.2 | % | — | |||||||||||||||
Commercial mortgage loans | 4.8 | % | 84 | 4.8 | % | 77 | — | % | 7 | |||||||||||||||
Restricted commercial mortgage loans related toa securitization entity | 7.0 | % | 1 | 8.4 | % | 2 | (1.4 | )% | (1 | ) | ||||||||||||||
Policy loans | 8.8 | % | 45 | 9.0 | % | 41 | (0.2 | )% | 4 | |||||||||||||||
Other invested assets (1) | 28.7 | % | 59 | 49.3 | % | 53 | (20.6 | )% | 6 | |||||||||||||||
Cash, cash equivalents, restricted cash andshort-term investments | 1.9 | % | 11 | 1.7 | % | 14 | 0.2 | % | (3 | ) | ||||||||||||||
Gross investment income before expenses and fees | 5.0 | % | 877 | 4.8 | % | 851 | 0.2 | % | 26 | |||||||||||||||
Expenses and fees | (0.2 | )% | (25 | ) | (0.1 | )% | (23 | ) | (0.1 | )% | (2 | ) | ||||||||||||
Net investment income | 4.8 | % | $ | 852 | 4.7 | % | $ | 828 | 0.1 | % | $ | 24 | ||||||||||||
Average invested assets and cash | $ | 70,752 | $ | 70,466 | $ | 286 | ||||||||||||||||||
Three months ended June 30, | Increase (decrease) | |||||||||||||||||||||||
2020 | 2019 | 2020 vs. 2019 | ||||||||||||||||||||||
(Amounts in millions) | Yield | Amount | Yield | Amount | Yield | Amount | ||||||||||||||||||
Fixed maturity securities—taxable | 4.4 | % | $ | 601 | 4.7 | % | $ | 634 | (0.3 | )% | $ | (33 | ) | |||||||||||
Fixed maturity securities—non-taxable | 2.6 | % | 1 | 6.1 | % | 2 | (3.5 | )% | (1 | ) | ||||||||||||||
Equity securities | 4.1 | % | 2 | 7.8 | % | 5 | (3.7 | )% | (3 | ) | ||||||||||||||
Commercial mortgage loans | 4.9 | % | 84 | 4.9 | % | 85 | — | % | (1 | ) | ||||||||||||||
Policy loans | 9.3 | % | 49 | 8.8 | % | 45 | 0.5 | % | 4 | |||||||||||||||
Other invested assets (1) | 23.3 | % | 66 | 28.7 | % | 59 | (5.4 | )% | 7 | |||||||||||||||
Cash, cash equivalents, restricted cash and short-term investments | 0.6 | % | 4 | 2.2 | % | 11 | (1.6 | )% | (7 | ) | ||||||||||||||
Gross investment income before expenses and fees | 4.8 | % | 807 | 5.1 | % | 841 | (0.3 | )% | (34 | ) | ||||||||||||||
Expenses and fees | (0.1 | )% | (21 | ) | (0.1 | )% | (25 | ) | — | % | 4 | |||||||||||||
Net investment income | 4.7 | % | $ | 786 | 5.0 | % | $ | 816 | (0.3 | )% | $ | (30 | ) | |||||||||||
Average invested assets and cash | $ | 67,598 | $ | 65,954 | $ | 1,644 | ||||||||||||||||||
Six months ended June 30, | Increase (decrease) | |||||||||||||||||||||||
2019 | 2018 | 2019 vs. 2018 | ||||||||||||||||||||||
(Amounts in millions) | Yield | Amount | Yield | Amount | Yield | Amount | ||||||||||||||||||
Fixed maturity securities—taxable | 4.5 | % | $ | 1,308 | 4.5 | % | $ | 1,286 | — | % | $ | 22 | ||||||||||||
Fixed maturity securities—non-taxable | 6.1 | % | 4 | 3.8 | % | 6 | 2.3 | % | (2 | ) | ||||||||||||||
Equity securities | 5.9 | % | 19 | 5.2 | % | 20 | 0.7 | % | (1 | ) | ||||||||||||||
Commercial mortgage loans | 4.8 | % | 165 | 5.0 | % | 159 | (0.2 | )% | 6 | |||||||||||||||
Restricted commercial mortgage loans related toa securitization entity | 6.8 | % | 2 | 8.1 | % | 4 | (1.3 | )% | (2 | ) | ||||||||||||||
Policy loans | 9.2 | % | 91 | 9.3 | % | 84 | (0.1 | )% | 7 | |||||||||||||||
Other invested assets (1) | 31.1 | % | 118 | 44.0 | % | 92 | (12.9 | )% | 26 | |||||||||||||||
Cash, cash equivalents, restricted cash andshort-term investments | 2.0 | % | 23 | 1.5 | % | 26 | 0.5 | % | (3 | ) | ||||||||||||||
Gross investment income before expenses and fees | 4.9 | % | 1,730 | 4.8 | % | 1,677 | 0.1 | % | 53 | |||||||||||||||
Expenses and fees | (0.1 | )% | (49 | ) | (0.2 | )% | (45 | ) | 0.1 | % | (4 | ) | ||||||||||||
Net investment income | 4.8 | % | $ | 1,681 | 4.6 | % | $ | 1,632 | 0.2 | % | $ | 49 | ||||||||||||
Average invested assets and cash | $ | 70,598 | $ | 70,529 | $ | 69 | ||||||||||||||||||
Six months ended June 30, | Increase (decrease) | |||||||||||||||||||||||
2020 | 2019 | 2020 vs. 2019 | ||||||||||||||||||||||
(Amounts in millions) | Yield | Amount | Yield | Amount | Yield | Amount | ||||||||||||||||||
Fixed maturity securities—taxable | 4.5 | % | $ | 1,223 | 4.6 | % | $ | 1,247 | (0.1 | )% | $ | (24 | ) | |||||||||||
Fixed maturity securities—non-taxable | 4.1 | % | 3 | 6.1 | % | 4 | (2.0 | )% | (1 | ) | ||||||||||||||
Equity securities | 3.8 | % | 4 | 6.8 | % | 9 | (3.0 | )% | (5 | ) | ||||||||||||||
Commercial mortgage loans | 4.9 | % | 169 | 4.8 | % | 167 | 0.1 | % | 2 | |||||||||||||||
Policy loans | 9.3 | % | 98 | 9.2 | % | 91 | 0.1 | % | 7 | |||||||||||||||
Other invested assets (1) | 20.5 | % | 113 | 31.1 | % | 118 | (10.6 | )% | (5 | ) | ||||||||||||||
Cash, cash equivalents, restricted cash and short-term investments | 1.0 | % | 15 | 2.1 | % | 22 | (1.1 | )% | (7 | ) | ||||||||||||||
Gross investment income before expenses and fees | 4.8 | % | 1,625 | 5.0 | % | 1,658 | (0.2 | )% | (33 | ) | ||||||||||||||
Expenses and fees | (0.1 | )% | (46 | ) | (0.1 | )% | (48 | ) | — | % | 2 | |||||||||||||
Net investment income | 4.7 | % | $ | 1,579 | 4.9 | % | $ | 1,610 | (0.2 | )% | $ | (31 | ) | |||||||||||
Average invested assets and cash | $ | 67,596 | $ | 65,840 | $ | 1,756 | ||||||||||||||||||
(1) | Investment income for other invested assets includes amortization of terminated cash flow hedges, which have no corresponding book value within the yield calculation and includes limited partnership investments, which are primarily equity-based and do not have fixed returns by period. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
(Amounts in millions) | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Available-for-sale fixed maturity securities: | ||||||||||||||||
Realized gains | $ | 5 | $ | 13 | $ | 86 | $ | 20 | ||||||||
Realized losses | (6 | ) | (21 | ) | (28 | ) | (37 | ) | ||||||||
Net realized gains (losses) on available-for-sale fixed maturity securities | (1 | ) | (8 | ) | 58 | (17 | ) | |||||||||
Impairments: | ||||||||||||||||
Total other-than-temporary impairments | — | — | — | — | ||||||||||||
Portion of other-than-temporary impairments included in other comprehensive income (loss) | — | — | — | — | ||||||||||||
Net other-than-temporary impairments | — | — | — | — | ||||||||||||
Net realized gains (losses) on equity securities sold | — | 8 | 3 | 10 | ||||||||||||
Net unrealized gains (losses) on equity securities still held | (12 | ) | 3 | (4 | ) | (15 | ) | |||||||||
Limited partnerships | (11 | ) | (2 | ) | 4 | 5 | ||||||||||
Commercial mortgage loans | 1 | — | — | — | ||||||||||||
Derivative instruments | (22 | ) | (15 | ) | (32 | ) | (28 | ) | ||||||||
Net investment gains (losses) | $ | (45 | ) | $ | (14 | ) | $ | 29 | $ | (45 | ) | |||||
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in millions) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Available-for-sale | ||||||||||||||||
Realized gains | $ | 119 | $ | 10 | $ | 133 | $ | 74 | ||||||||
Realized losses | (5 | ) | (21 | ) | (6 | ) | (27 | ) | ||||||||
Net realized gains (losses) on available-for-sale | 114 | (11 | ) | 127 | 47 | |||||||||||
Impairments: | ||||||||||||||||
Total other-than-temporary impairments | — | — | — | — | ||||||||||||
Portion of other-than-temporary impairments included in other comprehensive income (loss) | — | — | — | — | ||||||||||||
Net other-than-temporary impairments | — | — | — | — | ||||||||||||
Net change in allowance for credit losses on available-for-sale | (7 | ) | — | (7 | ) | — | ||||||||||
Net realized gains (losses) on equity securities sold | — | — | — | 3 | ||||||||||||
Net unrealized gains (losses) on equity securities still held | 9 | 5 | (10 | ) | 17 | |||||||||||
Limited partnerships | 37 | (11 | ) | (3 | ) | 4 | ||||||||||
Commercial mortgage loans | 1 | 1 | 1 | — | ||||||||||||
Derivative instruments | 10 | (30 | ) | (95 | ) | (42 | ) | |||||||||
Other | (5 | ) | — | (6 | ) | — | ||||||||||
Net investment gains (losses) | $ | 159 | $ | (46 | ) | $ | 7 | $ | 29 | |||||||
June 30, 2019 | December 31, 2018 | |||||||||||||||
(Amounts in millions) | Carrying value | % of total | Carrying value | % of total | ||||||||||||
Fixed maturity securities, available-for-sale: | ||||||||||||||||
Public | $ | 44,013 | 57 | % | $ | 41,857 | 58 | % | ||||||||
Private | 19,761 | 26 | 17,804 | 25 | ||||||||||||
Equity securities | 644 | 1 | 655 | 1 | ||||||||||||
Commercial mortgage loans | 6,963 | 9 | 6,687 | 8 | ||||||||||||
Restricted commercial mortgage loans related to a securitization entity | 56 | — | 62 | — | ||||||||||||
Policy loans | 2,076 | 3 | 1,861 | 3 | ||||||||||||
Other invested assets | 1,535 | 2 | 1,188 | 2 | ||||||||||||
Cash, cash equivalents and restricted cash | 1,938 | 2 | 2,177 | 3 | ||||||||||||
Total cash, cash equivalents, restricted cash and invested assets | $ | 76,986 | 100 | % | $ | 72,291 | 100 | % | ||||||||
June 30, 2020 | December 31, 2019 | |||||||||||||||
(Amounts in millions) | Carrying value | % of total | Carrying value | % of total | ||||||||||||
Fixed maturity securities, available-for-sale: | ||||||||||||||||
Public | $ | 44,794 | 58 | % | $ | 42,162 | 57 | % | ||||||||
Private | 18,750 | 24 | 18,177 | 24 | ||||||||||||
Equity securities | 206 | — | 239 | — | ||||||||||||
Commercial mortgage loans, net | 6,917 | 9 | 6,963 | 9 | ||||||||||||
Policy loans | 2,182 | 3 | 2,058 | 3 | ||||||||||||
Other invested assets | 2,473 | 3 | 1,632 | 2 | ||||||||||||
Cash, cash equivalents and restricted cash | 2,597 | 3 | 3,341 | 5 | ||||||||||||
Total cash, cash equivalents, restricted cash and invested assets | $ | 77,919 | 100 | % | $ | 74,572 | 100 | % | ||||||||
(Amounts in millions) | Amortized cost or cost | Gross unrealized gains | Gross unrealized losses | Allowance for credit losses | Fair value | |||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises | $ | 3,877 | $ | 1,725 | $ | — | $ | — | $ | 5,602 | ||||||||||
State and political subdivisions | 2,503 | 496 | (1 | ) | — | 2,998 | ||||||||||||||
Non-U.S. government | 1,424 | 125 | (7 | ) | — | 1,542 | ||||||||||||||
U.S. corporate: | ||||||||||||||||||||
Utilities | 4,392 | 879 | (1 | ) | — | 5,270 | ||||||||||||||
Energy | 2,454 | 203 | (63 | ) | — | 2,594 | ||||||||||||||
Finance and insurance | 7,400 | 1,017 | (14 | ) | — | 8,403 | ||||||||||||||
Consumer—non-cyclical | 5,132 | 1,147 | (2 | ) | — | 6,277 | ||||||||||||||
Technology and communications | 2,912 | 503 | (4 | ) | — | 3,411 | ||||||||||||||
Industrial | 1,350 | 157 | (4 | ) | — | 1,503 | ||||||||||||||
Capital goods | 2,580 | 454 | (6 | ) | — | 3,028 | ||||||||||||||
Consumer—cyclical | 1,748 | 224 | (6 | ) | — | 1,966 | ||||||||||||||
Transportation | 1,335 | 254 | (24 | ) | — | 1,565 | ||||||||||||||
Other | 340 | 38 | — | — | 378 | |||||||||||||||
Total U.S. corporate | 29,643 | 4,876 | (124 | ) | — | 34,395 | ||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||
Utilities | 811 | 68 | — | — | 879 | |||||||||||||||
Energy | 1,141 | 148 | (14 | ) | — | 1,275 | ||||||||||||||
Finance and insurance | 2,199 | 284 | (16 | ) | (1 | ) | 2,466 | |||||||||||||
Consumer—non-cyclical | 692 | 86 | (1 | ) | — | 777 | ||||||||||||||
Technology and communications | 1,066 | 182 | (1 | ) | — | 1,247 | ||||||||||||||
Industrial | 883 | 116 | (4 | ) | — | 995 | ||||||||||||||
Capital goods | 565 | 50 | (2 | ) | — | 613 | ||||||||||||||
Consumer—cyclical | 380 | 27 | — | — | 407 | |||||||||||||||
Transportation | 560 | 84 | (6 | ) | (3 | ) | 635 | |||||||||||||
Other | 1,376 | 218 | (3 | ) | — | 1,591 | ||||||||||||||
Total non-U.S. corporate | 9,673 | 1,263 | (47 | ) | (4 | ) | 10,885 | |||||||||||||
Residential mortgage-backed (1) | 1,927 | 259 | (2 | ) | — | 2,184 | ||||||||||||||
Commercial mortgage-backed | 2,800 | 225 | (52 | ) | (3 | ) | 2,970 | |||||||||||||
Other asset-backed | 2,987 | 30 | (49 | ) | — | 2,968 | ||||||||||||||
Total available-for-sale | $ | 54,834 | $ | 8,999 | $ | (282 | ) | $ | (7 | ) | $ | 63,544 | ||||||||
(1) | Fair value included $8 million collateralized by Alt-A residential mortgage loans and $21 million collateralized bysub-prime residential mortgage loans. |
Gross unrealized gains | Gross unrealized losses | |||||||||||||||||||||||
(Amounts in millions) | Amortized cost or cost | Not other-than- temporarily impaired | Other-than- temporarily impaired | Not other-than- temporarily impaired | Other-than- temporarily impaired | Fair value | ||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||||||
U.S. government, agencies andgovernment-sponsoredenterprises | $ | 4,151 | $ | 837 | $ | — | $ | (1 | ) | $ | — | $ | 4,987 | |||||||||||
State and political subdivisions | 2,319 | 317 | — | — | — | 2,636 | ||||||||||||||||||
Non-U.S. government | 2,496 | 155 | — | (2 | ) | — | 2,649 | |||||||||||||||||
U.S. corporate: | ||||||||||||||||||||||||
Utilities | 4,327 | 565 | — | (13 | ) | — | 4,879 | |||||||||||||||||
Energy | 2,468 | 255 | — | (10 | ) | — | 2,713 | |||||||||||||||||
Finance and insurance | 6,974 | 633 | — | (10 | ) | — | 7,597 | |||||||||||||||||
Consumer—non-cyclical | 4,954 | 616 | — | (18 | ) | — | 5,552 | |||||||||||||||||
Technology and communications | 2,893 | 269 | — | (6 | ) | — | 3,156 | |||||||||||||||||
Industrial | 1,242 | 98 | — | (4 | ) | — | 1,336 | |||||||||||||||||
Capital goods | 2,323 | 303 | — | (6 | ) | — | 2,620 | |||||||||||||||||
Consumer—cyclical | 1,619 | 127 | — | (5 | ) | — | 1,741 | |||||||||||||||||
Transportation | 1,263 | 152 | — | (4 | ) | — | 1,411 | |||||||||||||||||
Other | 356 | 40 | — | — | — | 396 | ||||||||||||||||||
Total U.S. corporate | 28,419 | 3,058 | — | (76 | ) | — | 31,401 | |||||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||||||
Utilities | 1,114 | 54 | — | (3 | ) | — | 1,165 | |||||||||||||||||
Energy | 1,349 | 168 | — | (1 | ) | — | 1,516 | |||||||||||||||||
Finance and insurance | 2,438 | 191 | — | (1 | ) | — | 2,628 | |||||||||||||||||
Consumer—non-cyclical | 674 | 40 | — | (4 | ) | — | 710 | |||||||||||||||||
Technology and communications | 1,179 | 94 | — | — | — | 1,273 | ||||||||||||||||||
Industrial | 936 | 81 | — | — | — | 1,017 | ||||||||||||||||||
Capital goods | 663 | 33 | — | (1 | ) | — | 695 | |||||||||||||||||
Consumer—cyclical | 542 | 16 | — | (1 | ) | — | 557 | |||||||||||||||||
Transportation | 761 | 82 | — | (2 | ) | — | 841 | |||||||||||||||||
Other | 2,061 | 186 | — | (2 | ) | — | 2,245 | |||||||||||||||||
Total non-U.S. corporate | 11,717 | 945 | — | (15 | ) | — | 12,647 | |||||||||||||||||
Residential mortgage-backed (1) | 2,511 | 215 | 14 | (2 | ) | — | 2,738 | |||||||||||||||||
Commercial mortgage-backed | 2,882 | 121 | — | (14 | ) | — | 2,989 | |||||||||||||||||
Other asset-backed | 3,699 | 38 | — | (10 | ) | — | 3,727 | |||||||||||||||||
Total available-for-sale fixedmaturity securities | $ | 58,194 | $ | 5,686 | $ | 14 | $ | (120 | ) | $ | — | $ | 63,774 | |||||||||||
Gross unrealized gains | Gross unrealized losses | |||||||||||||||||||||||
(Amounts in millions) | Amortized cost or cost | Not other-than- temporarily impaired | Other-than- temporarily impaired | Not other-than- temporarily impaired | Other-than- temporarily impaired | Fair value | ||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises | $ | 4,073 | $ | 952 | $ | — | $ | — | $ | — | $ | 5,025 | ||||||||||||
State and political subdivisions | 2,394 | 355 | — | (2 | ) | — | 2,747 | |||||||||||||||||
Non-U.S. government | 1,235 | 117 | — | (2 | ) | — | 1,350 | |||||||||||||||||
U.S. corporate: | ||||||||||||||||||||||||
Utilities | 4,322 | 675 | — | — | — | 4,997 | ||||||||||||||||||
Energy | 2,404 | 303 | — | (8 | ) | — | 2,699 | |||||||||||||||||
Finance and insurance | 6,977 | 798 | — | (1 | ) | — | 7,774 | |||||||||||||||||
Consumer—non-cyclical | 4,909 | 796 | — | (4 | ) | — | 5,701 | |||||||||||||||||
Technology and communications | 2,883 | 363 | — | (1 | ) | — | 3,245 | |||||||||||||||||
Industrial | 1,271 | 125 | — | — | — | 1,396 | ||||||||||||||||||
Capital goods | 2,345 | 367 | — | (1 | ) | — | 2,711 | |||||||||||||||||
Consumer—cyclical | 1,590 | 172 | — | (2 | ) | — | 1,760 | |||||||||||||||||
Transportation | 1,320 | 187 | — | (1 | ) | — | 1,506 | |||||||||||||||||
Other | 292 | 30 | — | — | — | 322 | ||||||||||||||||||
Total U.S. corporate | 28,313 | 3,816 | — | (18 | ) | — | 32,111 | |||||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||||||
Utilities | 779 | 50 | — | — | — | 829 | ||||||||||||||||||
Energy | 1,140 | 179 | — | — | — | 1,319 | ||||||||||||||||||
Finance and insurance | 2,087 | 232 | — | — | — | 2,319 | ||||||||||||||||||
Consumer—non-cyclical | 631 | 55 | — | (2 | ) | — | 684 | |||||||||||||||||
Technology and communications | 1,010 | 128 | — | — | — | 1,138 | ||||||||||||||||||
Industrial | 896 | 92 | — | — | — | 988 | ||||||||||||||||||
Capital goods | 565 | 40 | — | — | — | 605 | ||||||||||||||||||
Consumer—cyclical | 373 | 24 | — | — | — | 397 | ||||||||||||||||||
Transportation | 557 | 73 | — | (1 | ) | — | 629 | |||||||||||||||||
Other | 1,431 | 188 | — | (2 | ) | — | 1,617 | |||||||||||||||||
Total non-U.S. corporate | 9,469 | 1,061 | — | (5 | ) | — | 10,525 | |||||||||||||||||
Residential mortgage-backed (1) | 2,057 | 199 | 15 | (1 | ) | — | 2,270 | |||||||||||||||||
Commercial mortgage-backed | 2,897 | 137 | — | (8 | ) | — | 3,026 | |||||||||||||||||
Other asset-backed | 3,262 | 30 | — | (7 | ) | — | 3,285 | |||||||||||||||||
Total available-for-sale | $ | 53,700 | $ | 6,667 | $ | 15 | $ | (43 | ) | $ | — | $ | 60,339 | |||||||||||
(1) | Fair value included Alt-A residential mortgage loans and sub-prime residential mortgage loans. |
Gross unrealized gains | Gross unrealized losses | |||||||||||||||||||||||
(Amounts in millions) | Amortized cost or cost | Not other-than- temporarily impaired | Other-than- temporarily impaired | Not other-than- temporarily impaired | Other-than- temporarily impaired | Fair value | ||||||||||||||||||
Fixed maturity securities: | ||||||||||||||||||||||||
U.S. government, agencies andgovernment-sponsoredenterprises | $ | 4,175 | $ | 473 | $ | — | $ | (17 | ) | $ | — | $ | 4,631 | |||||||||||
State and political subdivisions | 2,406 | 168 | — | (22 | ) | — | 2,552 | |||||||||||||||||
Non-U.S. government | 2,345 | 72 | — | (24 | ) | — | 2,393 | |||||||||||||||||
U.S. corporate: | ||||||||||||||||||||||||
Utilities | 4,439 | 331 | — | (95 | ) | — | 4,675 | |||||||||||||||||
Energy | 2,382 | 101 | — | (64 | ) | — | 2,419 | |||||||||||||||||
Finance and insurance | 6,705 | 249 | — | (132 | ) | — | 6,822 | |||||||||||||||||
Consumer—non-cyclical | 4,891 | 294 | — | (137 | ) | — | 5,048 | |||||||||||||||||
Technology and communications | 2,823 | 110 | — | (78 | ) | — | 2,855 | |||||||||||||||||
Industrial | 1,230 | 41 | — | (33 | ) | — | 1,238 | |||||||||||||||||
Capital goods | 2,277 | 165 | — | (51 | ) | — | 2,391 | |||||||||||||||||
Consumer—cyclical | 1,592 | 53 | — | (48 | ) | — | 1,597 | |||||||||||||||||
Transportation | 1,283 | 78 | — | (41 | ) | — | 1,320 | |||||||||||||||||
Other | 376 | 24 | — | (3 | ) | — | 397 | |||||||||||||||||
Total U.S. corporate | 27,998 | 1,446 | — | (682 | ) | — | 28,762 | |||||||||||||||||
Non-U.S. corporate: | ||||||||||||||||||||||||
Utilities | 1,056 | 17 | — | (32 | ) | — | 1,041 | |||||||||||||||||
Energy | 1,320 | 72 | — | (23 | ) | — | 1,369 | |||||||||||||||||
Finance and insurance | 2,391 | 72 | — | (40 | ) | — | 2,423 | |||||||||||||||||
Consumer—non-cyclical | 756 | 8 | — | (25 | ) | — | 739 | |||||||||||||||||
Technology and communications | 1,168 | 23 | — | (26 | ) | — | 1,165 | |||||||||||||||||
Industrial | 926 | 36 | — | (17 | ) | — | 945 | |||||||||||||||||
Capital goods | 615 | 10 | — | (10 | ) | — | 615 | |||||||||||||||||
Consumer—cyclical | 532 | 1 | — | (13 | ) | — | 520 | |||||||||||||||||
Transportation | 689 | 46 | — | (15 | ) | — | 720 | |||||||||||||||||
Other | 2,218 | 105 | — | (23 | ) | — | 2,300 | |||||||||||||||||
Total non-U.S. corporate | 11,671 | 390 | — | (224 | ) | — | 11,837 | |||||||||||||||||
Residential mortgage-backed (1) | 2,888 | 160 | 13 | (17 | ) | — | 3,044 | |||||||||||||||||
Commercial mortgage-backed | 3,054 | 43 | — | (81 | ) | — | 3,016 | |||||||||||||||||
Other asset-backed | 3,444 | 10 | 1 | (29 | ) | — | 3,426 | |||||||||||||||||
Total available-for-sale fixedmaturity securities | $ | 57,981 | $ | 2,762 | $ | 14 | $ | (1,096 | ) | $ | — | $ | 59,661 | |||||||||||
June 30, 2019 | ||||||||||||||||||||
(Dollar amounts in millions) | Total recorded investment | Number of loans | Loan-to-value (1) | Delinquent principal balance | Number of delinquent loans | |||||||||||||||
Loan Year | ||||||||||||||||||||
2008 and prior | $ | 1,186 | 419 | 38 | % | $ | — | — | ||||||||||||
2009 | — | — | — | % | — | — | ||||||||||||||
2010 | 48 | 10 | 37 | % | — | — | ||||||||||||||
2011 | 183 | 45 | 40 | % | — | — | ||||||||||||||
2012 | 445 | 79 | 44 | % | — | — | ||||||||||||||
2013 | 621 | 118 | 48 | % | — | — | ||||||||||||||
2014 | 740 | 130 | 52 | % | — | — | ||||||||||||||
2015 | 865 | 139 | 57 | % | — | — | ||||||||||||||
2016 | 543 | 95 | 60 | % | — | — | ||||||||||||||
2017 | 758 | 142 | 65 | % | — | — | ||||||||||||||
2018 | 1,030 | 165 | 69 | % | — | — | ||||||||||||||
2019 | 559 | 72 | 71 | % | — | — | ||||||||||||||
Total | $ | 6,978 | 1,414 | 55 | % | $ | — | — | ||||||||||||
June 30, 2020 | ||||||||||||||||||||
(Dollar amounts in millions) | Total amortized cost | Number of loans | Debt-to-value (1) | Delinquent principal balance | Number of delinquent loans | |||||||||||||||
Loan Year | ||||||||||||||||||||
2010 and prior | $ | 1,069 | 381 | 36 | % | $ | — | — | ||||||||||||
2011 | 161 | 41 | 37 | % | — | — | ||||||||||||||
2012 | 400 | 74 | 41 | % | — | — | ||||||||||||||
2013 | 549 | 112 | 46 | % | — | — | ||||||||||||||
2014 | 685 | 122 | 49 | % | 10 | 1 | ||||||||||||||
2015 | 786 | 129 | 55 | % | — | — | ||||||||||||||
2016 | �� | 499 | 91 | 58 | % | — | — | |||||||||||||
2017 | 731 | 141 | 60 | % | — | — | ||||||||||||||
2018 | 1,000 | 164 | 66 | % | — | — | ||||||||||||||
2019 | 796 | 110 | 70 | % | — | — | ||||||||||||||
2020 | 269 | 42 | 70 | % | — | — | ||||||||||||||
Total | $ | 6,945 | 1,407 | 54 | % | $ | 10 | 1 | ||||||||||||
(1) | Represents weighted-average debt-to-value |
December 31, 2018 | ||||||||||||||||||||
(Dollar amounts in millions) | Total recorded investment | Number of loans | Loan-to-value (1) | Delinquent principal balance | Number of delinquent loans | |||||||||||||||
Loan Year | ||||||||||||||||||||
2008 and prior | $ | 1,310 | 459 | 39 | % | $ | 3 | 1 | ||||||||||||
2009 | — | — | — | % | — | — | ||||||||||||||
2010 | 50 | 11 | 37 | % | — | — | ||||||||||||||
2011 | 193 | 46 | 41 | % | — | — | ||||||||||||||
2012 | 476 | 81 | 45 | % | — | — | ||||||||||||||
2013 | 656 | 122 | 48 | % | 3 | 1 | ||||||||||||||
2014 | 772 | 133 | 53 | % | — | — | ||||||||||||||
2015 | 877 | 139 | 58 | % | — | — | ||||||||||||||
2016 | 553 | 96 | 61 | % | — | — | ||||||||||||||
2017 | 773 | 144 | 66 | % | — | — | ||||||||||||||
2018 | 1,040 | 165 | 69 | % | — | — | ||||||||||||||
Total | $ | 6,700 | 1,396 | 54 | % | $ | 6 | 2 | ||||||||||||
December 31, 2019 | ||||||||||||||||||||
(Dollar amounts in millions) | Total recorded investment | Number of loans | Debt-to-value (1) | Delinquent principal balance | Number of delinquent loans | |||||||||||||||
Loan Year | ||||||||||||||||||||
2010 and prior | $ | 1,182 | 419 | 37 | % | $ | — | — | ||||||||||||
2011 | 168 | 42 | 38 | % | — | — | ||||||||||||||
2012 | 415 | 75 | 42 | % | — | — | ||||||||||||||
2013 | 579 | 114 | 47 | % | — | — | ||||||||||||||
2014 | 720 | 129 | 50 | % | — | — | ||||||||||||||
2015 | 833 | 136 | 56 | % | — | — | ||||||||||||||
2016 | 517 | 93 | 59 | % | — | — | ||||||||||||||
2017 | 740 | 141 | 61 | % | — | — | ||||||||||||||
2018 | 1,019 | 165 | 66 | % | — | — | ||||||||||||||
2019 | 807 | 111 | 71 | % | — | — | ||||||||||||||
Total | $ | 6,980 | 1,425 | 54 | % | $ | — | — | ||||||||||||
(1) | Represents weighted-average debt-to-value |
June 30, 2019 | December 31, 2018 | |||||||||||||||
(Amounts in millions) | Carrying value | % of total | Carrying value | % of total | ||||||||||||
Limited partnerships | $ | 512 | 34 | % | $ | 409 | 34 | % | ||||||||
Bank loan investments | 337 | 22 | 248 | 21 | ||||||||||||
Derivatives | 280 | 18 | 178 | 15 | ||||||||||||
Short-term investments | 273 | 18 | 230 | 19 | ||||||||||||
Securities lending collateral | 113 | 7 | 102 | 9 | ||||||||||||
Other investments | 20 | 1 | 21 | 2 | ||||||||||||
Total other invested assets | $ | 1,535 | 100 | % | $ | 1,188 | 100 | % | ||||||||
June 30, 2020 | December 31, 2019 | |||||||||||||||
(Amounts in millions) | Carrying value | % of total | Carrying value | % of total | ||||||||||||
Derivatives | $ | 1,024 | 41 | % | $ | 290 | 18 | % | ||||||||
Limited partnerships | 764 | 31 | 634 | 39 | ||||||||||||
Bank loan investments | 396 | 16 | 383 | 23 | ||||||||||||
Short-term investments | 212 | 9 | 260 | 16 | ||||||||||||
Securities lending collateral | 59 | 2 | 51 | 3 | ||||||||||||
Other investments | 18 | 1 | 14 | 1 | ||||||||||||
Total other invested assets | $ | 2,473 | 100 | % | $ | 1,632 | 100 | % | ||||||||
(Notional in millions) | Measurement | December 31, 2018 | Additions | Maturities/ terminations | June 30, 2019 | |||||||||||||
Derivatives designated as hedges | ||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||
Interest rate swaps | Notional | $ | 9,924 | $ | 469 | $ | (1,338 | ) | $ | 9,055 | ||||||||
Foreign currency swaps | Notional | 80 | 52 | (22 | ) | 110 | ||||||||||||
Total cash flow hedges | 10,004 | 521 | (1,360 | ) | 9,165 | |||||||||||||
Total derivatives designated as hedges | 10,004 | 521 | (1,360 | ) | 9,165 | |||||||||||||
Derivatives not designated as hedges | ||||||||||||||||||
Interest rate swaps | Notional | 4,674 | — | — | 4,674 | |||||||||||||
Interest rate swaps in a foreign currency | Notional | 2,565 | 187 | (77 | ) | 2,675 | ||||||||||||
Interest rate caps and floors | Notional | 2,624 | 160 | (66 | ) | 2,718 | ||||||||||||
Foreign currency swaps | Notional | 453 | — | (2 | ) | 451 | ||||||||||||
Equity index options | Notional | 2,628 | 939 | (1,035 | ) | 2,532 | ||||||||||||
Financial futures | Notional | 1,415 | 3,029 | (3,217 | ) | 1,227 | ||||||||||||
Equity return swaps | Notional | 17 | 2 | (2 | ) | 17 | ||||||||||||
Other foreign currency contracts | Notional | 1,080 | 2,925 | (2,704 | ) | 1,301 | ||||||||||||
Total derivatives not designated as hedges | 15,456 | 7,242 | (7,103 | ) | 15,595 | |||||||||||||
Total derivatives | $ | 25,460 | $ | 7,763 | $ | (8,463 | ) | $ | 24,760 | |||||||||
December 31, | Maturities/ | June 30, | ||||||||||||||||
(Notional in millions) | Measurement | 2019 | Additions | terminations | 2020 | |||||||||||||
Derivatives designated as hedges | ||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||
Interest rate swaps | Notional | $ | 8,968 | $ | 1,158 | $ | (1,880 | ) | $ | 8,246 | ||||||||
Foreign currency swaps | Notional | 110 | — | — | 110 | |||||||||||||
Total cash flow hedges | 9,078 | 1,158 | (1,880 | ) | 8,356 | |||||||||||||
Total derivatives designated as hedges | 9,078 | 1,158 | (1,880 | ) | 8,356 | |||||||||||||
Derivatives not designated as hedges | ||||||||||||||||||
Interest rate swaps | Notional | 4,674 | — | — | 4,674 | |||||||||||||
Equity index options | Notional | 2,451 | 883 | (1,126 | ) | 2,208 | ||||||||||||
Financial futures | Notional | 1,182 | 3,082 | (2,914 | ) | 1,350 | ||||||||||||
Other foreign currency contracts | Notional | 628 | 3,009 | (2,618 | ) | 1,019 | ||||||||||||
Total derivatives not designated as hedges | 8,935 | 6,974 | (6,658 | ) | 9,251 | |||||||||||||
Total derivatives | $ | 18,013 | $ | 8,132 | $ | (8,538 | ) | $ | 17,607 | |||||||||
(Number of policies) | Measurement | December 31, 2019 | Additions | Maturities/ terminations | June 30, 2020 | |||||||||||||
Derivatives not designated as hedges | ||||||||||||||||||
GMWB embedded derivatives | Policies | 25,623 | — | (992 | ) | 24,631 | ||||||||||||
Fixed index annuity embedded derivatives | Policies | 15,441 | — | (668 | ) | 14,773 | ||||||||||||
Indexed universal life embedded derivatives | Policies | 884 | — | (28 | ) | 856 |
(Number of policies) | Measurement | December 31, 2018 | Additions | Maturities/ terminations | June 30, 2019 | |||||||||||||
Derivatives not designated as hedges | ||||||||||||||||||
GMWB embedded derivatives | Policies | 27,886 | — | (1,139 | ) | 26,747 | ||||||||||||
Fixed index annuity embedded derivatives | Policies | 16,464 | — | (410 | ) | 16,054 | ||||||||||||
Indexed universal life embedded derivatives | Policies | 929 | — | (21 | ) | 908 |
Cash, cash equivalents, restricted cash and invested assets increased $3,347 million primarily from increases of $3,205 million and $841 million in fixed maturity securities and other invested assets, | ||
driven largely by borrower forbearance resulting from COVID-19. In addition, existing reserves were strengthened by $28 million in the current year primarily driven by the deterioration of early cure emergence patterns impacting claim frequency along with a modest increase in claim severity. The increase was also attributable to our long-term care insurance business primarily attributable to new claims, which includes higher new claims frequency as a result of the aging of thein-force block, as well as higher severity, partially offset by an increase in claim terminations driven mostly by higher mortality and favorable development on prior year incurred but not reported claims in the current year. Given the lower new claim counts submitted duringCOVID-19, incurred but not reported reserves were strengthened by $37 million reflecting our assumption that new claim incidence during this period will ultimately return to normal levels, partially offsetting the favorable development on incurred but not reported claims. |
(Amounts in millions) | 2019 | 2018 | ||||||
Net cash from operating activities | $ | 795 | $ | 561 | ||||
Net cash used by investing activities | (351 | ) | (198 | ) | ||||
Net cash used by financing activities | (695 | ) | (943 | ) | ||||
Net decrease in cash before foreign exchange effect | $ | (251 | ) | $ | (580 | ) | ||
(Amounts in millions) | 2020 | 2019 | ||||||
Net cash from operating activities | $ | 1,299 | $ | 795 | ||||
Net cash used by investing activities | (887 | ) | (351 | ) | ||||
Net cash used by financing activities | (1,144 | ) | (695 | ) | ||||
Net decrease in cash before foreign exchange effect | $ | (732 | ) | $ | (251 | ) | ||
(Amounts in millions) | Parent Guarantor | Issuer | All Other Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Assets | ||||||||||||||||||||
Investments: | ||||||||||||||||||||
Fixed maturity securities available-for-sale, | $ | — | $ | — | $ | 63,544 | $ | — | $ | 63,544 | ||||||||||
Equity securities, at fair value | — | — | 206 | — | 206 | |||||||||||||||
Commercial mortgage loans (net of unamortized balance of loan origination fees and costs of $4) | — | — | 6,945 | — | 6,945 | |||||||||||||||
Less: Allowance for credit losses | — | — | (28 | ) | — | (28 | ) | |||||||||||||
Commercial mortgage loans, net | — | — | 6,917 | — | 6,917 | |||||||||||||||
Policy loans | — | — | 2,182 | — | 2,182 | |||||||||||||||
Other invested assets | — | 50 | 2,423 | — | 2,473 | |||||||||||||||
Investments in subsidiaries | 14,548 | 16,174 | — | (30,722 | ) | — | ||||||||||||||
Total investments | 14,548 | 16,224 | 75,272 | (30,722 | ) | 75,322 | ||||||||||||||
Cash, cash equivalents and restricted cash | — | 504 | 2,093 | — | 2,597 | |||||||||||||||
Accrued investment income | — | — | 601 | — | 601 | |||||||||||||||
Deferred acquisition costs | — | — | 1,718 | — | 1,718 | |||||||||||||||
Intangible assets and goodwill | — | — | 223 | — | 223 | |||||||||||||||
Reinsurance recoverable | — | — | 16,944 | — | 16,944 | |||||||||||||||
Less: Allowance for credit losses | — | — | (44 | ) | — | (44 | ) | |||||||||||||
Reinsurance recoverable, net | — | — | 16,900 | — | 16,900 | |||||||||||||||
Other assets | 5 | 188 | 261 | — | 454 | |||||||||||||||
Intercompany notes receivable | 96 | 214 | — | (310 | ) | — | ||||||||||||||
Deferred tax assets | 9 | 944 | (667 | ) | — | 286 | ||||||||||||||
Separate account assets | — | — | 5,536 | — | 5,536 | |||||||||||||||
Total assets | $ | 14,658 | $ | 18,074 | $ | 101,937 | $ | (31,032 | ) | $ | 103,637 | |||||||||
Liabilities and equity | ||||||||||||||||||||
Liabilities: | ||||||||||||||||||||
Future policy benefits | $ | — | $ | — | $ | 41,463 | $ | — | $ | 41,463 | ||||||||||
Policyholder account balances | — | — | 22,921 | — | 22,921 | |||||||||||||||
Liability for policy and contract claims | — | — | 11,280 | — | 11,280 | |||||||||||||||
Unearned premiums | — | — | 1,804 | — | 1,804 | |||||||||||||||
Other liabilities | 15 | 109 | 1,951 | — | 2,075 | |||||||||||||||
Intercompany notes payable | — | 96 | 214 | (310 | ) | — | ||||||||||||||
Long-term borrowings | — | 2,679 | 138 | — | 2,817 | |||||||||||||||
Separate account liabilities | — | — | 5,536 | — | 5,536 | |||||||||||||||
Liabilities related to discontinued operations | — | 653 | — | — | 653 | |||||||||||||||
Total liabilities | 15 | 3,537 | 85,307 | (310 | ) | 88,549 | ||||||||||||||
Equity: | ||||||||||||||||||||
Common stock | 1 | — | 3 | (3 | ) | 1 | ||||||||||||||
Additional paid-in capital | 11,996 | 12,761 | 18,432 | (31,193 | ) | 11,996 | ||||||||||||||
Accumulated other comprehensive income (loss) | 4,447 | 4,447 | 4,539 | (8,986 | ) | 4,447 | ||||||||||||||
Retained earnings | 899 | (2,671 | ) | (7,089 | ) | 9,760 | 899 | |||||||||||||
Treasury stock, at cost | (2,700 | ) | — | — | — | (2,700 | ) | |||||||||||||
Total Genworth Financial, Inc.’s stockholders’ equity | 14,643 | 14,537 | 15,885 | (30,422 | ) | 14,643 | ||||||||||||||
Noncontrolling interests | — | — | 745 | (300 | ) | 445 | ||||||||||||||
Total equity | 14,643 | 14,537 | 16,630 | (30,722 | ) | 15,088 | ||||||||||||||
Total liabilities and equity | $ | 14,658 | $ | 18,074 | $ | 101,937 | $ | (31,032 | ) | $ | 103,637 | |||||||||
(Amounts in millions) | Parent Guarantor | Issuer | All Other Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Assets | ||||||||||||||||||||
Investments: | ||||||||||||||||||||
Fixed maturity securities available-for-sale, | $ | — | $ | — | $ | 60,539 | $ | (200 | ) | $ | 60,339 | |||||||||
Equity securities, at fair value | — | — | 239 | — | 239 | |||||||||||||||
Commercial mortgage loans ($47 are restricted related to a securitization entity) | — | — | 6,963 | — | 6,963 | |||||||||||||||
Policy loans | — | — | 2,058 | — | 2,058 | |||||||||||||||
Other invested assets | — | 71 | 1,561 | — | 1,632 | |||||||||||||||
Investments in subsidiaries | 14,079 | 15,090 | — | (29,169 | ) | — | ||||||||||||||
Total investments | 14,079 | 15,161 | 71,360 | (29,369 | ) | 71,231 | ||||||||||||||
Cash, cash equivalents and restricted cash | — | 1,461 | 1,880 | — | 3,341 | |||||||||||||||
Accrued investment income | — | — | 657 | (3 | ) | 654 | ||||||||||||||
Deferred acquisition costs | — | — | 1,836 | — | 1,836 | |||||||||||||||
Intangible assets and goodwill | — | — | 201 | — | 201 | |||||||||||||||
Reinsurance recoverable | — | — | 17,103 | — | 17,103 | |||||||||||||||
Other assets | 4 | 201 | 239 | (1 | ) | 443 | ||||||||||||||
Intercompany notes receivable | 119 | 132 | — | (251 | ) | — | ||||||||||||||
Deferred tax assets | 13 | 821 | (409 | ) | — | 425 | ||||||||||||||
Separate account assets | — | — | 6,108 | — | 6,108 | |||||||||||||||
Total assets | $ | 14,215 | $ | 17,776 | $ | 98,975 | $ | (29,624 | ) | $ | 101,342 | |||||||||
Liabilities and equity | ||||||||||||||||||||
Liabilities: | ||||||||||||||||||||
Future policy benefits | $ | — | $ | — | $ | 40,384 | $ | — | $ | 40,384 | ||||||||||
Policyholder account balances | — | — | 22,217 | — | 22,217 | |||||||||||||||
Liability for policy and contract claims | — | — | 10,958 | — | 10,958 | |||||||||||||||
Unearned premiums | — | — | 1,893 | — | 1,893 | |||||||||||||||
Other liabilities | 30 | 118 | 1,285 | (5 | ) | 1,428 | ||||||||||||||
Intercompany notes payable | — | 319 | 132 | (451 | ) | — | ||||||||||||||
Non-recourse funding obligations | — | — | 311 | — | 311 | |||||||||||||||
Long-term borrowings | — | 3,137 | 140 | — | 3,277 | |||||||||||||||
Separate account liabilities | — | — | 6,108 | — | 6,108 | |||||||||||||||
Liabilities related to discontinued operations | — | 134 | — | — | 134 | |||||||||||||||
Total liabilities | 30 | 3,708 | 83,428 | (456 | ) | 86,710 | ||||||||||||||
Equity: | ||||||||||||||||||||
Common stock | 1 | — | 3 | (3 | ) | 1 | ||||||||||||||
Additional paid-in capital | 11,990 | 12,761 | 18,431 | (31,192 | ) | 11,990 | ||||||||||||||
Accumulated other comprehensive income (loss) | 3,433 | 3,433 | 3,474 | (6,907 | ) | 3,433 | ||||||||||||||
Retained earnings | 1,461 | (2,126 | ) | (7,108 | ) | 9,234 | 1,461 | |||||||||||||
Treasury stock, at cost | (2,700 | ) | — | — | — | (2,700 | ) | |||||||||||||
Total Genworth Financial, Inc.’s stockholders’ equity | 14,185 | 14,068 | 14,800 | (28,868 | ) | 14,185 | ||||||||||||||
Noncontrolling interests | — | — | 747 | (300 | ) | 447 | ||||||||||||||
Total equity | 14,185 | 14,068 | 15,547 | (29,168 | ) | 14,632 | ||||||||||||||
Total liabilities and equity | $ | 14,215 | $ | 17,776 | $ | 98,975 | $ | (29,624 | ) | $ | 101,342 | |||||||||
(Amounts in millions) | Parent Guarantor | Issuer | All Other Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Revenues: | ||||||||||||||||||||
Premiums | $ | — | $ | — | $ | 2,034 | $ | — | $ | 2,034 | ||||||||||
Net investment income | (2 | ) | 5 | 1,579 | (3 | ) | 1,579 | |||||||||||||
Net investment gains (losses) | — | 8 | (1 | ) | — | 7 | ||||||||||||||
Policy fees and other income | — | 2 | 356 | (3 | ) | 355 | ||||||||||||||
Total revenues | (2 | ) | 15 | 3,968 | (6 | ) | 3,975 | |||||||||||||
Benefits and expenses: | ||||||||||||||||||||
Benefits and other changes in policy reserves | — | — | 2,847 | — | 2,847 | |||||||||||||||
Interest credited | — | — | 280 | — | 280 | |||||||||||||||
Acquisition and operating expenses, net of deferrals | 15 | 5 | 452 | — | 472 | |||||||||||||||
Amortization of deferred acquisition costs and intangibles | — | — | 209 | — | 209 | |||||||||||||||
Goodwill impairment | — | — | 5 | — | 5 | |||||||||||||||
Interest expense | — | 92 | 10 | (6 | ) | 96 | ||||||||||||||
Total benefits and expenses | 15 | 97 | 3,803 | (6 | ) | 3,909 | ||||||||||||||
Income (loss) from continuing operations before income taxes and equity in income (loss) of subsidiaries | (17 | ) | (82 | ) | 165 | — | 66 | |||||||||||||
Provision (benefit) for income taxes | — | (17 | ) | 53 | — | 36 | ||||||||||||||
Equity in income (loss) of subsidiaries | (491 | ) | 96 | — | 395 | — | ||||||||||||||
Income (loss) from continuing operations | (508 | ) | 31 | 112 | 395 | 30 | ||||||||||||||
Income (loss) from discontinued operations, net of taxes | 1 | (521 | ) | — | — | (520 | ) | |||||||||||||
Net income (loss) | (507 | ) | (490 | ) | 112 | 395 | (490 | ) | ||||||||||||
Less: net income from continuing operations attributable to noncontrolling interests | — | — | 17 | — | 17 | |||||||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests | — | — | — | — | — | |||||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | (507 | ) | $ | (490 | ) | $ | 95 | $ | 395 | $ | (507 | ) | |||||||
(Amounts in millions) | Parent Guarantor | Issuer | All Other Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Revenues: | ||||||||||||||||||||
Premiums | $ | — | $ | — | $ | 4,037 | $ | — | $ | 4,037 | ||||||||||
Net investment income | (3 | ) | 10 | 3,228 | (15 | ) | 3,220 | |||||||||||||
Net investment gains (losses) | — | (5 | ) | 55 | — | 50 | ||||||||||||||
Policy fees and other income | — | 2 | 792 | (5 | ) | 789 | ||||||||||||||
Total revenues | (3 | ) | 7 | 8,112 | (20 | ) | 8,096 | |||||||||||||
Benefits and expenses: | ||||||||||||||||||||
Benefits and other changes in policy reserves | — | — | 5,163 | — | 5,163 | |||||||||||||||
Interest credited | — | — | 577 | — | 577 | |||||||||||||||
Acquisition and operating expenses, net of deferrals | 20 | — | 942 | — | 962 | |||||||||||||||
Amortization of deferred acquisition costs and intangibles | — | — | 441 | — | 441 | |||||||||||||||
Interest expense | 3 | 231 | 25 | (20 | ) | 239 | ||||||||||||||
Total benefits and expenses | 23 | 231 | 7,148 | (20 | ) | 7,382 | ||||||||||||||
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries | (26 | ) | (224 | ) | 964 | — | 714 | |||||||||||||
Provision (benefit) for income taxes | (3 | ) | (45 | ) | 243 | — | 195 | |||||||||||||
Equity in income of subsidiaries | 366 | 177 | — | (543 | ) | — | ||||||||||||||
Income (loss) from continuing operations | 343 | (2 | ) | 721 | (543 | ) | 519 | |||||||||||||
Income (loss) from discontinued operations, net of taxes | — | (140 | ) | 151 | — | 11 | ||||||||||||||
Net income (loss) | 343 | (142 | ) | 872 | (543 | ) | 530 | |||||||||||||
Less: net income from continuing operations attributable to noncontrolling interests | — | — | 64 | — | 64 | |||||||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests | — | — | 123 | — | 123 | |||||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders | $ | 343 | $ | (142 | ) | $ | 685 | $ | (543 | ) | $ | 343 | ||||||||
(Amounts in millions) | Parent Guarantor | Issuer | All Other Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Net income (loss) | $ | (507 | ) | $ | (490 | ) | $ | 112 | $ | 395 | $ | (490 | ) | |||||||
Other comprehensive income (loss), net of taxes: | ||||||||||||||||||||
Net unrealized gains (losses) on securities without an allowance for credit losses | 363 | 363 | 363 | (727 | ) | 362 | ||||||||||||||
Net unrealized gains (losses) on securities with an allowance for credit losses | (8 | ) | (8 | ) | (8 | ) | 16 | (8 | ) | |||||||||||
Derivatives qualifying as hedges | 675 | 675 | 725 | (1,400 | ) | 675 | ||||||||||||||
Foreign currency translation and other adjustments | (16 | ) | (16 | ) | (25 | ) | 32 | (25 | ) | |||||||||||
Total other comprehensive income (loss) | 1,014 | 1,014 | 1,055 | (2,079 | ) | 1,004 | ||||||||||||||
Total comprehensive income | 507 | 524 | 1,167 | (1,684 | ) | 514 | ||||||||||||||
Less: comprehensive income attributable to noncontrolling interests | — | — | 7 | — | 7 | |||||||||||||||
Total comprehensive income available to Genworth Financial, Inc.’s common stockholders | $ | 507 | $ | 524 | $ | 1,160 | $ | (1,684 | ) | $ | 507 | |||||||||
(Amounts in millions) | Parent Guarantor | Issuer | All Other Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Net income (loss) | $ | 343 | $ | (142 | ) | $ | 872 | $ | (543 | ) | $ | 530 | ||||||||
Other comprehensive income (loss), net of taxes: | ||||||||||||||||||||
Net unrealized gains (losses) on securities not other-than- temporarily impaired | 859 | 842 | 846 | (1,701 | ) | 846 | ||||||||||||||
Net unrealized gains (losses) on other-than-temporarily impaired securities | 2 | 2 | 2 | (4 | ) | 2 | ||||||||||||||
Derivatives qualifying as hedges | 221 | 221 | 247 | (468 | ) | 221 | ||||||||||||||
Foreign currency translation and other adjustments | 307 | 224 | 486 | (530 | ) | 487 | ||||||||||||||
Total other comprehensive income (loss) | 1,389 | 1,289 | 1,581 | (2,703 | ) | 1,556 | ||||||||||||||
Total comprehensive income | 1,732 | 1,147 | 2,453 | (3,246 | ) | 2,086 | ||||||||||||||
Less: comprehensive income attributable to noncontrolling interests | — | — | 354 | — | 354 | |||||||||||||||
Total comprehensive income available to Genworth Financial, Inc.’s common stockholders | $ | 1,732 | $ | 1,147 | $ | 2,099 | $ | (3,246 | ) | $ | 1,732 | |||||||||
(Amounts in millions) | Parent Guarantor | Issuer | All Other Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Cash flows from (used by) operating activities: | ||||||||||||||||||||
Net income (loss) | $ | (507 | ) | $ | (490 | ) | $ | 112 | $ | 395 | $ | (490 | ) | |||||||
Less (income) loss from discontinued operations, net of taxes | (1 | ) | 521 | — | — | 520 | ||||||||||||||
Adjustments to reconcile net income (loss) to net cash from (used by) operating activities: | ||||||||||||||||||||
Equity in income (loss) from subsidiaries | 491 | (96 | ) | — | (395 | ) | — | |||||||||||||
Dividends from subsidiaries | — | 11 | (11 | ) | — | — | ||||||||||||||
Amortization of fixed maturity securities discounts and premiums | — | 3 | (53 | ) | — | (50 | ) | |||||||||||||
Net investment (gains) losses | — | (8 | ) | 1 | — | (7 | ) | |||||||||||||
Charges assessed to policyholders | — | — | (314 | ) | — | (314 | ) | |||||||||||||
Acquisition costs deferred | — | — | (9 | ) | — | (9 | ) | |||||||||||||
Amortization of deferred acquisition costs and intangibles | — | — | 209 | — | 209 | |||||||||||||||
Goodwill impairment | — | — | 5 | — | 5 | |||||||||||||||
Deferred income taxes | 3 | 29 | (4 | ) | — | 28 | ||||||||||||||
Derivative instruments, limited partnerships and other | — | (54 | ) | 245 | — | 191 | ||||||||||||||
Stock-based compensation expense | 19 | — | — | — | 19 | |||||||||||||||
Change in certain assets and liabilities: | ||||||||||||||||||||
Accrued investment income and other assets | (1 | ) | (3 | ) | (122 | ) | (5 | ) | (131 | ) | ||||||||||
Insurance reserves | — | — | 674 | — | 674 | |||||||||||||||
Current tax liabilities | (6 | ) | 23 | (18 | ) | — | (1 | ) | ||||||||||||
Other liabilities, policy and contract claims and other policy-related balances | (15 | ) | (133 | ) | 798 | 5 | 655 | |||||||||||||
Net cash from (used by) operating activities | (17 | ) | (197 | ) | 1,513 | — | 1,299 | |||||||||||||
Cash flows from (used by) investing activities: | ||||||||||||||||||||
Proceeds from maturities and repayments of investments: | ||||||||||||||||||||
Fixed maturity securities | — | — | 1,687 | — | 1,687 | |||||||||||||||
Commercial mortgage loans | — | — | 302 | — | 302 | |||||||||||||||
Other invested assets | — | — | 71 | — | 71 | |||||||||||||||
Proceeds from sales of investments: | ||||||||||||||||||||
Fixed maturity and equity securities | — | — | 1,657 | — | 1,657 | |||||||||||||||
Purchases and originations of investments: | ||||||||||||||||||||
Fixed maturity and equity securities | — | — | (4,166 | ) | — | (4,166 | ) | |||||||||||||
Commercial mortgage loans | — | — | (271 | ) | — | (271 | ) | |||||||||||||
Other invested assets | — | — | (236 | ) | — | (236 | ) | |||||||||||||
Short-term investments, net | — | 20 | 39 | — | 59 | |||||||||||||||
Policy loans, net | — | — | 10 | — | 10 | |||||||||||||||
Intercompany notes receivable | 23 | (82 | ) | 200 | (141 | ) | — | |||||||||||||
Capital contributions to subsidiaries | (1 | ) | — | 1 | — | — | ||||||||||||||
Net cash from (used by) investing activities | 22 | (62 | ) | (706 | ) | (141 | ) | (887 | ) | |||||||||||
Cash flows used by financing activities: | ||||||||||||||||||||
Deposits to universal life and investment contracts | — | — | 516 | — | 516 | |||||||||||||||
Withdrawals from universal life and investment contracts | — | — | (914 | ) | — | (914 | ) | |||||||||||||
Redemption of non-recourse funding obligations | — | — | (315 | ) | — | (315 | ) | |||||||||||||
Repayment and repurchase of long-term debt | — | (471 | ) | — | — | (471 | ) | |||||||||||||
Dividends paid to noncontrolling interests | — | — | (9 | ) | — | (9 | ) | |||||||||||||
Intercompany notes payable | — | (223 | ) | 82 | 141 | — | ||||||||||||||
Other, net | (5 | ) | (4 | ) | 58 | — | 49 | |||||||||||||
Net cash used by financing activities | (5 | ) | (698 | ) | (582 | ) | 141 | (1,144 | ) | |||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | — | — | (12 | ) | — | (12 | ) | |||||||||||||
Net change in cash, cash equivalents and restricted cash | — | (957 | ) | 213 | — | (744 | ) | |||||||||||||
Cash, cash equivalents and restricted cash at beginning of period | — | 1,461 | 1,880 | — | 3,341 | |||||||||||||||
Cash, cash equivalents and restricted cash at end of period | — | 504 | 2,093 | — | 2,597 | |||||||||||||||
Less cash, cash equivalents and restricted cash of discontinued operations at end of period | — | — | — | — | — | |||||||||||||||
Cash, cash equivalents and restricted cash of continuing operations at end of period | $ | — | $ | 504 | $ | 2,093 | $ | — | $ | 2,597 | ||||||||||
(Amounts in millions) | Parent Guarantor | Issuer | All Other Subsidiaries | Eliminations | Consolidated | |||||||||||||||
Cash flows from operating activities: | ||||||||||||||||||||
Net income (loss) | $ | 343 | $ | (142 | ) | $ | 872 | $ | (543 | ) | $ | 530 | ||||||||
Less (income) loss from discontinued operations, net of taxes | — | 140 | (151 | ) | — | (11 | ) | |||||||||||||
Adjustments to reconcile net income (loss) to net cash from operating activities: | ||||||||||||||||||||
Equity in income from subsidiaries | (366 | ) | (177 | ) | — | 543 | — | |||||||||||||
Dividends from subsidiaries | 250 | 1,352 | (1,602 | ) | — | — | ||||||||||||||
Amortization of fixed maturity securities discounts and premiums | — | 8 | (126 | ) | — | (118 | ) | |||||||||||||
Net investment (gains) losses | — | 5 | (55 | ) | — | (50 | ) | |||||||||||||
Charges assessed to policyholders | — | — | (699 | ) | — | (699 | ) | |||||||||||||
Acquisition costs deferred | — | — | (27 | ) | — | (27 | ) | |||||||||||||
Amortization of deferred acquisition costs and intangibles | — | — | 441 | — | 441 | |||||||||||||||
Deferred income taxes | 1 | 132 | 6 | — | 139 | |||||||||||||||
Derivative instruments and limited partnerships | — | (35 | ) | (63 | ) | — | (98 | ) | ||||||||||||
Stock-based compensation expense | 26 | — | 1 | — | 27 | |||||||||||||||
Change in certain assets and liabilities: | ||||||||||||||||||||
Accrued investment income and other assets | — | 7 | (365 | ) | — | (358 | ) | |||||||||||||
Insurance reserves | — | — | 1,259 | — | 1,259 | |||||||||||||||
Current tax liabilities | 16 | (43 | ) | 53 | — | 26 | ||||||||||||||
Other liabilities, policy and contract claims and other policy-related balances | (17 | ) | (44 | ) | 668 | 2 | 609 | |||||||||||||
Cash from operating activities—discontinued operations | — | 134 | 275 | — | 409 | |||||||||||||||
Net cash from operating activities | 253 | 1,337 | 487 | 2 | 2,079 | |||||||||||||||
Cash flows from (used by) investing activities: | ||||||||||||||||||||
Proceeds from maturities and repayments of investments: | ||||||||||||||||||||
Fixed maturity securities | — | — | 3,436 | — | 3,436 | |||||||||||||||
Commercial mortgage loans | — | — | 582 | — | 582 | |||||||||||||||
Restricted commercial mortgage loans related to a securitization entity | — | — | 15 | — | 15 | |||||||||||||||
Proceeds from sales of investments: | ||||||||||||||||||||
Fixed maturity and equity securities | — | — | 3,883 | — | 3,883 | |||||||||||||||
Purchases and originations of investments: | ||||||||||||||||||||
Fixed maturity and equity securities | — | — | (6,899 | ) | — | (6,899 | ) | |||||||||||||
Commercial mortgage loans | — | — | (813 | ) | — | (813 | ) | |||||||||||||
Other invested assets, net | — | 5 | (392 | ) | (2 | ) | (389 | ) | ||||||||||||
Policy loans, net | — | — | 62 | — | 62 | |||||||||||||||
Intercompany notes receivable | (119 | ) | 48 | 6 | 65 | — | ||||||||||||||
Capital contributions to subsidiaries | (5 | ) | — | 5 | — | — | ||||||||||||||
Proceeds from sale of business, net of cash transferred | — | — | 1,398 | — | 1,398 | |||||||||||||||
Cash from investing activities—discontinued operations | — | — | 26 | — | 26 | |||||||||||||||
Net cash from (used by) investing activities | (124 | ) | 53 | 1,309 | 63 | 1,301 | ||||||||||||||
Cash flows used by financing activities: | ||||||||||||||||||||
Deposits to universal life and investment contracts | — | — | 824 | — | 824 | |||||||||||||||
Withdrawals from universal life and investment contracts | — | — | (2,319 | ) | — | (2,319 | ) | |||||||||||||
Repayment and repurchase of long-term debt | — | (446 | ) | — | — | (446 | ) | |||||||||||||
Intercompany notes payable | (122 | ) | 112 | 75 | (65 | ) | — | |||||||||||||
Repurchase of subsidiary shares | — | — | (22 | ) | — | (22 | ) | |||||||||||||
Dividends paid to noncontrolling interests | — | — | (87 | ) | — | (87 | ) | |||||||||||||
Other, net | (7 | ) | (24 | ) | (4 | ) | — | (35 | ) | |||||||||||
Cash used by financing activities—discontinued operations | — | — | (132 | ) | — | (132 | ) | |||||||||||||
Net cash used by financing activities | (129 | ) | (358 | ) | (1,665 | ) | (65 | ) | (2,217 | ) | ||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash (includes $6 related to discontinued operations) | — | — | 1 | — | 1 | |||||||||||||||
Net change in cash, cash equivalents and restricted cash | — | 1,032 | 132 | — | 1,164 | |||||||||||||||
Cash, cash equivalents and restricted cash at beginning of period | — | 429 | 1,748 | — | 2,177 | |||||||||||||||
Cash, cash equivalents and restricted cash at end of period | — | 1,461 | 1,880 | — | 3,341 | |||||||||||||||
Less cash, cash equivalents and restricted cash of discontinued operations at end of period | — | — | — | — | — | |||||||||||||||
Cash, cash equivalents and restricted cash of continuing operations at end of period | $ | — | $ | 1,461 | $ | 1,880 | $ | — | $ | 3,341 | ||||||||||
Item 3. | Quantitative and Qualitative Disclosures About Market Risk |
Item 4. | Controls and Procedures |
Item 1. | Legal Proceedings |
Item 1A. | Risk Factors |
Item 6. | Exhibits |
Number | Description | |||
2.1 | ||||
10.1§ | ||||
10.2§ | ||||
10.3§ | ||||
10.4 | ||||
31.1 | ||||
31.2 | ||||
32.1 | ||||
32.2 | ||||
101.INS | XBRL Instance Document | |||
101.SCH | ||||
XBRL Taxonomy Extension Schema Document | ||||
101.CAL | ||||
XBRL Taxonomy Extension Calculation Linkbase Document | ||||
101.LAB | ||||
XBRL Taxonomy Extension Label Linkbase Document | ||||
101.PRE | ||||
XBRL Taxonomy Extension Presentation Linkbase Document | ||||
101.DEF | ||||
XBRL Taxonomy Extension Definition Linkbase Document | ||||
104 | The cover page for the Company’s Quarterly Report on Form 10-Q for the three months ended June 30, 2020, has been formatted in Inline XBRL |
§ | Management contract or compensatory plan or arrangement. |
GENWORTH FINANCIAL, INC. (Registrant) | |||||||
Date: | |||||||
By: | /s/ Matthew D. Farney | ||||||
Matthew D. Farney Vice President and Controller (Principal Accounting Officer) |