Canada Life Financial 6-K Canada Life Reports Growth in Third Quarter Results Despite Challenging Markets

Exhibit 99.2

Consolidated Statements of Net Income —Unaudited

			Three months				Nine months
For the period ended September 30
(in millions of Canadian dollars, except per share amounts)			2002		2001(1)		2002		2001(1)
REVENUES
Premiums
	Participating insurance and annuities		$	181	$	162	$	586	$	573
	Non-participating:
		Annuities		737		611		1,787		1,705
		Individual life and health insurance		134		127		389		385
		Group life and health insurance		447		394		1,360		1,200
		Reinsurance		62		41		169		123
				1,561		1,335		4,291		3,986
Net investment income				496		452		1,554		1,575
Fee and other income				131		117		404		344
				2,188		1,904		6,249		5,905
EXPENDITURES
Payments to policyholders and beneficiaries
		Life, health and general benefits		626		457		1,586		1,327
		Annuity payments		340		314		998		919
		Maturities, surrender payments and other		335		405		1,025		1,336
		Participating policyholder dividends		73		71		222		220
				1,374		1,247		3,831		3,802
Increase in actuarial liabilities				302		217		869		690
Commissions				134		109		381		331
General expenses				192		177		565		561
Premium and other taxes				17		4		49		38
Interest expense				9		10		29		29
Non-controlling interest in subsidiary(note 3)				8		—		17		—
Goodwill expense(note 2(a)(ii))				—		7		—		19
				2,036		1,771		5,741		5,470
Net income before income tax provision				152		133		508		435
Income tax provision				36		39		142		141
Net income including participating policyholders’ net income (loss)				116		94		366		294
Participating policyholders’ net income (loss)				—		3		—		(10	)
Shareholders’ net income			$	116	$	91	$	366	$	304
Preferred share dividends				2		—		7		—
Common shareholders’ net income			$	114	$	91	$	359	$	304
Average number of common shares outstanding(millions)
	Basic			160.4		160.4		160.4		160.4
	Diluted			160.4		160.7		160.4		160.7
Earnings per common share
	Basic		$	0.71	$	0.57	$	2.24	$	1.90
	Diluted		$	0.71	$	0.57	$	2.24	$	1.89

⁽¹⁾ As restated, see note 1.

(See accompanying notes)

Canada Life Financial Corporation — Third Quarter Report 2002      1

Consolidated Balance Sheets —Unaudited

			As at
			September 30		December 31		September 30(1)
(in millions of Canadian dollars)			2002		2001		2001
ASSETS
General fund
Invested assets
	Bonds		$	20,933	$	19,046	$	19,073
	Mortgages			7,845		7,996		7,947
	Common and preferred stocks			1,960		2,475		2,361
	Real estate			1,050		941		964
	Policy loans			1,124		1,070		1,036
	Short-term investments			125		149		150
	Cash and cash equivalents			1,705		993		545
	Other			519		775		612
Total invested assets				35,261		33,445		32,688
Premiums receivable				132		123		136
Investment income due and accrued				434		369		473
Goodwill(note 2(a)(ii))				137		137		143
Other assets				699		877		886
Total general fund			$	36,663	$	34,951	$	34,326
Segregated funds			$	20,776	$	22,090	$	20,093
LIABILITIES AND EQUITY
General fund
Policy liabilities
	Actuarial liabilities		$	27,835	$	27,169	$	26,835
	Benefits payable and provision for unreported claims			680		645		537
	Policyholders’ amounts left on deposit			444		426		419
	Provision for future policyholder dividends and experience rating refunds			377		372		362
Total policy liabilities				29,336		28,612		28,153
Net deferred gains				1,458		1,491		1,471
Other liabilities				1,050		875		894
				31,844		30,978		30,518
Subordinated debentures				550		550		550
Non-controlling interest in subsidiary(note 3)				450		—		—
Equity
	Participating policyholders’ equity			43		40		34
	Shareholders’ equity
		Preferred shares(note 4)		145		145		—
		Common shares(note 4)		317		317		317
		Total retained earnings		3,314		2,921		2,907
Total equity				3,819		3,423		3,258
Total general fund			$	36,663	$	34,951	$	34,326
Segregated funds			$	20,776	$	22,090	$	20,093

⁽¹⁾As restated, see note 1.

(See accompanying notes)

Canada Life Financial Corporation — Third Quarter Report 2002      2

Consolidated Statements of Equity- Unaudited

For the nine months ended September 30(in millions of Canadian dollars)		2002			2001(1)
PARTICIPATING POLICYHOLDERS’ EQUITY
	Balance, beginning of period	$	41		$	45
	Participating policyholders’ net loss		—			(10	)
	Balance, end of period		41			35
Currency translation account
	Balance, beginning of period		(1	)		(1	)
	Change for the period		3			—
	Balance, end of period		2			(1	)
Total participating policyholders’ equity		$	43		$	34
SHAREHOLDERS’ EQUITY
Share capital
Preferred shares
	Balance, beginning and end of period	$	145		$	—
Common shares
	Balance, beginning and end of period	$	317		$	317
Retained earnings
	Balance, beginning of period	$	2,910		$	2,652
	Shareholders’ net income		366			304
	Dividends paid to preferred shareholders		(7	)		—
	Dividends paid to common shareholders		(72	)		(63	)
	Issuance costs(note 3)		(5	)		—
	Balance, end of period		3,192			2,893
Currency translation account
	Balance, beginning of period		11			(77	)
	Change for the period		111			91
	Balance, end of period		122			14
Total retained earnings		$	3,314		$	2,907
Total equity		$	3,819		$	3,258

⁽¹⁾ As restated, see note 1.

(see accompanying notes)

Canada Life Financial Corporation — Third Quarter Report 2002      3

Consolidated Statements of Cash Flows- Unaudited

		Three months						Nine months
For the period ended September 30
(in millions of Canadian dollars)		2002			2001(1)			2002			2001(1)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income including participating policyholders’ net income (loss)		$	116		$	94		$	366		$	294
Items not affecting cash and cash equivalents
	Increase in actuarial liabilities and other policy liabilities		290			268			226			769
	Amortization of net deferred gains and amortization of net discounts on bonds and mortgages		(43	)		14			(155	)		(119	)
	Other, including future income taxes		(6	)		24			1			95
			357			400			438			1,039
Net change in other operating assets and liabilities
	Other assets		146			(74	)		63			(81	)
	Other liabilities		(117	)		(98	)		159			(115	)
			29			(172	)		222			(196	)
Increase due to operating activities			386			228			660			843
CASH FLOWS FROM INVESTING ACTIVITIES
Sales, maturities and scheduled redemptions of:
	Bonds		3,121			6,680			11,101			13,896
	Mortgages		507			442			1,449			1,353
	Common and preferred stocks		254			126			996			435
	Real estate		4			7			36			24
	Other investments		130			53			317			103
Purchases of:
	Bonds		(3,110	)		(7,104	)		(12,414	)		(14,803	)
	Mortgages		(483	)		(507	)		(1,236	)		(1,513	)
	Common and preferred stocks		(221	)		(114	)		(479	)		(773	)
	Real estate		(5	)		(31	)		(81	)		(104	)
	Other investments		(17	)		(31	)		(54	)		(120	)
Net short-term investments			9			(22	)		24			218
Net policy loans			(8	)		2			(54	)		(16	)
Increase (decrease) due to investing activities			181			(499	)		(395	)		(1,300	)
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of Canada Life Capital Securities, net(note 3)			—			—			445			—
Dividends paid to shareholders			(26	)		(21	)		(79	)		(63	)
Increase (decrease) due to financing activities			(26	)		(21	)		366			(63	)
Effect of changes in exchange rates on cash and cash equivalents			85			33			81			14
Net increase (decrease) in cash and cash equivalents for the period			626			(259	)		712			(506	)
Cash and cash equivalents, beginning of period			1,079			804			993			1,051
Cash and cash equivalents, end of period		$	1,705		$	545		$	1,705		$	545
Supplementary disclosure of cash flow information:
	Interest paid on subordinated debentures, other liabilities and Canada Life Capital Securities	$	17		$	10		$	46		$	29
	Income taxes paid, net of refunds	$	30		$	74		$	81		$	152

⁽¹⁾ As restated, see note 1.

(see accompanying notes)

Canada Life Financial Corporation — Third Quarter Report 2002      4

Consolidated Statements of Changes in Segregated Funds —Unaudited

	Three months						Nine months
For the period ended September 30
(in millions of Canadian dollars)	2002			2001			2002			2001
ADDITIONS TO SEGREGATED FUNDS
Deposits and transfers from the general fund	$	862		$	917		$	2,795		$	2,990
Reclassifications from the general fund and transfer of seed money		—			—			664			—
Net investment income		110			73			338			253
Impact of change in currency exchange rates		846			1,089			966			405
		1,818			2,079			4,763			3,648
DEDUCTIONS FROM SEGREGATED FUNDS
Withdrawals, benefit payments and transfers to the general fund		578			422			1,758			1,615
Operating expenses		89			97			291			280
Tax recovery		(3	)		(76	)		(13	)		(123	)
Net decrease in fair value of investments		2,307			2,648			4,041			4,166
		2,971			3,091			6,077			5,938
Net deduction from segregated funds for the period		(1,153	)		(1,012	)		(1,314	)		(2,290	)
Segregated funds, beginning of period		21,929			21,105			22,090			22,383
Segregated funds, end of period	$	20,776		$	20,093		$	20,776		$	20,093

(see accompanying notes)

Consolidated Statements of Segregated Funds Net Assets —Unaudited

	As at
	September 30			December 31			September 30
(in millions of Canadian dollars)	2002			2001			2001
Bonds	$	2,553		$	2,219		$	2,445
Mortgages		8			8			8
Common and preferred stocks		15,800			17,769			15,637
Real estate		874			788			765
Cash and short-term investments		1,715			1,536			1,334
Investment income due and accrued		30			20			40
Tax asset (liability)		(26	)		(61	)		41
Due to brokers and others		(178	)		(189	)		(177	)
	$	20,776		$	22,090		$	20,093

Canada Life Financial Corporation — Third Quarter Report 2002      5

Notes to the Interim Consolidated Financial Statements — Unaudited

For the three and nine months ended September 30, 2002

1.	ACCOUNTING POLICIES — AS PER THE 2001 ANNUAL REPORT
	The interim Consolidated Financial Statements for Canada Life Financial Corporation (the Company) should be read in conjunction with the Consolidated Financial Statements for the year ended December 31, 2001, as set out in the 2001 Annual Report. The significant accounting policies followed in the preparation of these interim Consolidated Financial Statements are consistent with those found in the 2001 Annual Report except as described in note 2 below.
	During the fourth quarter of 2001, the Company adopted the new Standards of Practice for the Valuation of Policy Liabilities of Life Insurers issued by the Canadian Institute of Actuaries. For further information see note 2(a) to the Consolidated Financial Statements included in the 2001 Annual Report. This change has resulted in an increase in shareholders’ net income of $16 million and $39 million for the three and nine months ended September 30, 2001, respectively, and a decrease of $181 million in shareholders’ equity as at September 30, 2001 from what was originally reported.
2.	ACCOUNTING POLICY AND OTHER CHANGES
(a)	Accounting Policy Changes
(i)	Stock-based Compensation and Other Stock-based Payments
	Effective January 1, 2002, the Company adopted the Canadian Institute of Chartered Accountants’ (CICA) new recommendations for Stock-based Compensation and Other Stock-based Payments, which allow for the use of either the fair value or intrinsic value methods to account for certain stock-based compensation agreements. The Company has adopted these recommendations retroactively without restatement of prior periods as the restatements are not material to the Consolidated Financial Statements. The Company uses the intrinsic value method of accounting for such awards, under which no compensation expense is recognized for stock options where the exercise price is equivalent to the closing market price of the Company’s shares on the Toronto Stock Exchange the day prior to the option grant date. The new recommendations also require that stock appreciation rights (SARs) that can be settled in cash be recorded as liabilities for the excess of the market value of the shares over the exercise price.
(ii)	Business Combinations, Goodwill and Other Intangible Assets
	Effective January 1, 2002, the Company adopted prospectively the new recommendations for Goodwill and Other Intangible Assets issued by the CICA. Under the new recommendations, all goodwill and intangible assets with indefinite lives ceased to be amortized to shareholders’ net income. Goodwill and intangible assets with indefinite lives are subject to a periodic impairment review to test whether the fair value remains greater than, or equal to, book value. Any excess of book value over fair value is charged to general expenses on the Consolidated Statements of Net Income in the period in which the impairment has been determined. The Company has completed its impairment testing on the goodwill balance as at December 31, 2001 and determined that goodwill is not impaired.
	Amortization of goodwill for the three months ended September 30, 2001 was $7 million and for the nine months ended September 30, 2001 was $19 million. Adoption of this standard has resulted in a $7 million decrease in expenses for the three months ended September 30 and a $19 million decrease in expenses for the nine months ended September 30 as goodwill was not amortized in 2002. Excluding the goodwill expense, the shareholders’ net income for the three months ended September 30, 2001 would have been $98 million and for the nine months ended September 30, 2001 would have been $323 million, resulting in an increase in both basic and diluted earnings per share of $0.04 and $0.12, respectively.
(b)	Other Changes
(i)	Valuation of invested assets held for the general fund
	In the third quarter of 2002, the Company changed the application of the rate used for the moving average market method for stocks and real estate portfolios in accordance with the requirements of the Office of the Superintendent of Financial Institutions, Canada. The fair value adjustment of the difference between the carrying value and period-end fair value and the amortization of net realized gains and losses have been changed from 15% per annum to 5% per quarter for stocks and from 10% per annum to 3% per quarter for real estate. The Company has adopted this change in estimate in the third quarter on a prospective basis. The impact of this change on these interim Consolidated Financial Statements was not material.

Canada Life Financial Corporation — Third Quarter Report 2002      6

3.	NON-CONTROLLING INTEREST IN SUBSIDIARY
	On March 14, 2002, Canada Life Capital Trust (CLCT), a trust established under the laws of Ontario by The Canada Trust Company and administered by The Canada Life Assurance Company (CLA), issued $450 million of non-voting Canada Life Capital Securities (CLiCS). CLCT issued $300 million of non-voting CLiCS — Series A and $150 million of non-voting CLiCS — Series B which qualify as Tier 1 capital for Canadian regulatory purposes. Holders of the CLiCS - Series A and CLiCS — Series B will be entitled to receive semi-annual, non-cumulative fixed cash distributions of $33.395 and $37.645 per $1,000 of CLiCS respectively, representing respective annual yields of 6.679% and 7.529% of the $1,000 initial issue price, payable out of CLCT’s net distributable funds. Subject to regulatory approval, CLCT may redeem any series of CLiCS, in whole or in part, at any time on or after September 30, 2007, and in certain limited circumstances, may also redeem all but not less than all of the CLiCS prior to September 30, 2007. The holders of the CLiCS will have the right at any time to surrender each $1,000 face amount of CLiCS and to receive from CLCT in exchange, in the case of CLiCS — Series A, 40 newly issued CLA Class A Shares Series 2, or in the case of CLiCS — Series B, 40 newly issued CLA Class A Shares Series 4, subject to compliance with the declaration of trust governing CLCT.
	Pursuant to the share exchange agreement, the Company and CLA agreed that if CLCT fails to pay on any regular distribution date the required cash distributions on the CLiCS in full, CLA would not pay dividends on any of its public preferred shares that may be outstanding. If there are no public preferred shares of CLA outstanding, the Company will not pay dividends on any of its preferred and common shares. As at September 30, 2002, CLA did not have any public preferred shares outstanding. In each case, the ability to restart distributions on the CLiCS and dividend payments to the public depends on the resumption of dividend payments on the CLA Class A Shares Series 1.
	In addition, as long as any CLiCS are outstanding, and provided that CLA does not have outstanding public preferred shares, the Company will not declare or pay dividends on outstanding preferred and common shares unless CLA has declared and paid a dividend on the CLA Class A Shares Series 1.
	The non-controlling interest in subsidiary on the Consolidated Balance Sheets consists of $450 million in CLiCS issued by CLCT.
4.	SHARE CAPITAL
(a)	Authorized:

(i)	Preferred shares
	There is an unlimited number of authorized non-voting preferred shares without nominal or par value, issuable in series. The Company’s by-laws authorize the Board of Directors, prior to the issue of any series of preferred shares, to fix the number of shares in, and to designate the rights, privileges, restrictions and conditions of each series, subject to the provisions of the Company’s by-laws and the Insurance Companies Act (Canada).
(ii)	Common shares
	There is an unlimited number of authorized voting common shares without nominal or par value.

(b) Issued and outstanding:

As at September 30
(in millions)	2002				2001
	Number of		Share		Number of		Share
	shares		value		shares		value
Preferred shares
Balance, beginning and end of period		6.0	$	145		—	$	—
Common shares
Balance, beginning and end of period		160.4	$	317		160.4	$	317

Canada Life Financial Corporation — Third Quarter Report 2002      7

5.	STOCK-BASED COMPENSATION
	In 2001, the Company introduced a directors share purchase plan, a deferred stock unit plan, and an employee stock purchase plan. Information concerning these plans, in addition to the stock option plan, is included in note 14 to the Consolidated Financial Statements included in the 2001 Annual Report.
	A summary of the Company’s outstanding stock options is as follows:

For the nine months ended September 30	2002				2001
	Number of		Weighted average		Number of		Weighted average
	stock options		exercise price		stock options		exercise price
Outstanding, beginning of period		2,046,410	$	39.86		962,046	$	36.95
Granted		1,054,762		43.10		1,107,339		42.22
Exercised		9,679		36.95		—		—
Forfeited		108,219		40.32		51,953		39.61
Outstanding, end of period		2,983,274	$	40.99		2,017,432	$	39.77
Exercisable, end of period		546,218	$	39.88		48,000	$	36.95
Available for grant		5,007,047				5,982,568

The stock options outstanding and exercisable as at September 30, 2002, by exercise price, were as follows:

	Options outstanding						Options exercisable
			Weighted average
			remaining		Weighted				Weighted
Range of exercise	Number of		contractual life		average		Number of		average exercise
prices	stock options		(years)		exercise price		stock options		price
$34.05 to $38.55		877,946		8.12	$	36.93		246,017	$	36.95
$38.56 to $43.06		1,068,085		8.39	$	42.24		300,201	$	42.28
$43.07 to $47.57		1,037,243		9.36	$	43.15		—		—
		2,983,274			$	40.99		546,218	$	39.88

Under the fair value method of accounting for stock options, the fair value is estimated at the grant date and the total fair value of the stock options is amortized over the vesting periods as compensation expense. The weighted average fair value of stock options at the grant date for the nine months ended September 30, 2002 was estimated to be $14.04 per stock option using the Black-Scholes option pricing model. The pricing model assumes the following weighted average information: risk-free interest rate of 5%, an expected life of seven years, an expected common share volatility of 24.4% and an expected dividend yield of 1.20%. Had the Company used the fair value method to measure compensation, the common shareholders’ net income, earnings per common share and diluted earnings per common share for the three months ended September 30, 2002 would have been reduced by $2 million, $0.01 and $0.01, respectively, and for the nine months ended September 30, 2002, would have been reduced by $5 million, $0.03 and $0.03, respectively.

The Company recognizes compensation expense for those stock options that have been awarded SARs in tandem based on the excess of the market value over the exercise price. The Company expects the SARs to be settled in cash and, therefore, accrues compensation expense on SARs over the vesting period equal to the excess of quoted market price at the balance sheet date over the exercise price.

Total compensation expense, included in general expenses on the Consolidated Statements of Net Income, for the three and nine months ended September 30, 2002 was not material.

Canada Life Financial Corporation — Third Quarter Report 2002      8

6.

SEGMENTED INFORMATION

The Company is a diversified international life insurance enterprise offering a wide range of protection and wealth management products to individuals and groups, through operating divisions in Canada, the United Kingdom, the United States, the Republic of Ireland, and an International and Reinsurance Division. In addition, there is a corporate group that manages invested assets, provides certain administrative services for the operating divisions and is responsible for capital management.

										International
			United		United			Republic		and
For the three months ended September 30	Canadian		Kingdom		States			of Ireland		Reinsurance			Corporate
(in millions of Canadian dollars)	Division		Division		Division			Division		Division			Division			Total
2002
GENERAL FUND
Revenues
Premiums	$	541	$	422	$	459		$	38	$	101		$	—		$	1,561
Net investment income		209		74		175			12		17			9			496
Fee and other income		43		65		2			20		1			—			131
		793		561		636			70		119			9			2,188
Expenditures
Payment to policyholders and beneficiaries		501		322		461			21		69			—			1,374
Increase in actuarial liabilities		83		126		73			3		17			—			302
General expenses, commissions, premium and other taxes and interest expense		132		69		72			40		31			16			360
		716		517		606			64		117			16			2,036
Net income (loss) before income tax provision (recovery)		77		44		30			6		2			(7	)		152
Income tax provision (recovery)		30		—		10			—		(1	)		(3	)		36
Net income (loss) including participating policyholders’ net income (loss)		47		44		20			6		3			(4	)		116
Participating policyholders’ net income (loss)		—		—		(1	)		1		—			—			—
Shareholders’ net income (loss)	$	47	$	44	$	21		$	5	$	3		$	(4	)	$	116
SEGREGATED FUNDS
Deposits	$	249	$	370	$	67		$	176	$	—		$	—		$	862
2001
GENERAL FUND
Revenues
Premiums	$	457	$	269	$	450		$	78	$	81		$	—		$	1,335
Net investment income		216		40		169			—		17			10			452
Fee and other income		46		51		4			14		2			—			117
		719		360		623			92		100			10			1,904
Expenditures
Payment to policyholders and beneficiaries		476		247		424			20		80			—			1,247
Increase in actuarial liabilities		38		20		112			36		11			—			217
General expenses, commissions, premium and other taxes, interest expense and goodwill		119		64		71			16		27			10			307
		633		331		607			72		118			10			1,771
Net income (loss) before income tax provision (recovery)		86		29		16			20		(18	)		—			133
Income tax provision (recovery)		37		1		3			5		(7	)		—			39
Net income (loss) including participating policyholders’ net income (loss)		49		28		13			15		(11	)		—			94
Participating policyholders’ net income (loss)		1		—		(1	)		2		1			—			3
Shareholders’ net income (loss)	$	48	$	28	$	14		$	13	$	(12	)	$	—		$	91
SEGREGATED FUNDS
Deposits	$	307	$	513	$	12		$	84	$	1		$	—		$	917

Canada Life Financial Corporation — Third Quarter Report 2002      9

										International
			United		United			Republic		and
For the nine months ended September 30	Canadian		Kingdom		States			of Ireland		Reinsurance			Corporate
(in millions of Canadian dollars)	Division		Division		Division			Division		Division			Division			Total
2002
GENERAL FUND
Revenues
Premiums	$	1,478	$	1,080	$	1,351		$	105	$	277		$	—		$	4,291
Net investment income		649		251		531			38		49			36			1,554
Fee and other income		137		174		15			74		4			—			404
		2,264		1,505		1,897			217		330			36			6,249
Expenditures
Payment to policyholders and beneficiaries		1,512		757		1,314			61		187			—			3,831
Increase in actuarial liabilities		121		431		262			24		31			—			869
General expenses, commissions, premium and other taxes and interest expense		403		187		210			102		95			44			1,041
		2,036		1,375		1,786			187		313			44			5,741
Net income (loss) before income tax provision (recovery)		228		130		111			30		17			(8	)		508
Income tax provision (recovery)		88		15		38			5		3			(7	)		142
Net income (loss) including participating policyholders’ net income (loss)		140		115		73			25		14			(1	)		366
Participating policyholders’ net income (loss)		—		—		(1	)		1		—			—			—
Shareholders’ net income (loss)	$	140	$	115	$	74		$	24	$	14		$	(1	)	$	366
Total assets	$	14,181	$	9,019	$	11,102		$	1,162	$	1,199		$	—		$	36,663
SEGREGATED FUNDS
Deposits	$	1,019	$	1,142	$	138		$	495	$	1		$	—		$	2,795
Total assets	$	7,038	$	10,279	$	629		$	2,826	$	4		$	—		$	20,776
2001
GENERAL FUND
Revenues
Premiums	$	1,407	$	773	$	1,273		$	295	$	238		$	—		$	3,986
Net investment income		688		255		512			39		48			33			1,575
Fee and other income		129		158		12			42		3			—			344
		2,224		1,186		1,797			376		289			33			5,905
Expenditures
Payment to policyholders and beneficiaries		1,527		698		1,304			80		193			—			3,802
Increase in actuarial liabilities		86		175		223			178		28			—			690
General expenses, commissions, premium and other taxes, interest expense and goodwill		387		207		203			80		73			28			978
		2,000		1,080		1,730			338		294			28			5,470
Net income (loss) before income tax provision (recovery)		224		106		67			38		(5	)		5			435
Income tax provision (recovery)		101		14		18			10		(4	)		2			141
Net income (loss) including participating policyholders’ net income (loss)		123		92		49			28		(1	)		3			294
Participating policyholders’ net income (loss)		—		—		(12	)		1		1			—			(10	)
Shareholders’ net income (loss)	$	123	$	92	$	61		$	27	$	(2	)	$	3		$	304
Total assets	$	13,989	$	7,288	$	10,710		$	1,500	$	839		$	—		$	34,326
SEGREGATED FUNDS
Deposits	$	1,080	$	1,515	$	31		$	363	$	1		$	—		$	2,990
Total assets	$	7,252	$	10,246	$	680		$	1,911	$	4		$	—		$	20,093

7.

SUBSEQUENT EVENT

On October 1, 2002 the Company completed its agreement with Royal & SunAlliance Insurance Group plc to acquire its group life and long term disability insurance business in the United Kingdom. Effective October 1, 2002, the Company reinsured the group insurance risks. Formal transfer of the business will occur after court approval, expected in mid- 2003. This acquisition has a purchase price of approximately $150 million.

Canada Life Financial Corporation — Third Quarter Report 2002      10