The Manulife Life Insurance Company, owned by Manulife Financial Corp. (NYSE:MFC), has agreed to reinsure C$5.8B ($4.3B) of Canadian policies with RGA Life Reinsurance Co. of Canada, a subsidiary of Reinsurance Group of America (NYSE:RGA), the companies said Monday.
The coinsurance transaction allows Manulife (MFC) to release C$0.8B in capital, which it intends to return to shareholders via share repurchases, resulting in core return on equity and core EPS accretion of 0.14 percentage points and $0.01, respectively. The block of Canadian universal life-insurance policies will continue to be administered by Manulife.
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