Sun Life’s fourth-quarter (Q4 2024) net income dropped by 75%, reflecting a significant impairment charge, though the company partially offset the decline with favorable interest rate impacts.
In its Asia unit, Sun Life posted an underlying net income of $175 million for Q4 2024, marking a 22% year-on-year increase. This growth was driven by higher wealth and asset management fees, improved protection experience, and stronger contributions from joint ventures. Wealth and asset management income rose by $9 million, attributed to an increase in assets under management. Additionally, individual protection income grew by $41 million.
However, regional office expenses and other operational costs led to an $18 million increase in net loss, driven by continued investments and higher incentive compensation expenses. Despite these gains, the region’s reported net income plummeted to just $11 million, a 75% decline compared to the same period in the previous year.
Kevin Strain, President and CEO of Sun Life, explained the drop in reported net income, saying, “In the fourth quarter, we saw sustained momentum in our Asia business. Our reported net income was affected by market conditions and an impairment in our Vietnam business.”
The overall performance was somewhat buoyed by favorable interest rate movements, improved real estate experience, and a higher underlying net income. Foreign exchange translation also contributed an additional $4 million to underlying net income and $6 million to reported net income.
Sales for the individual business segment reached $601 million, up 12%, driven by a significant case sale in International markets and increased sales through India’s bancassurance and direct-to-consumer channels. In Hong Kong, sales grew through both agency and bancassurance channels.
Wealth sales and asset management gross flows remained stable, with higher money market fund sales in the Philippines and stronger sales of Hong Kong’s Mandatory Provident Fund partially offset by a decline in fixed-income fund sales in India.
Sun Life’s new business contractual service margin (CSM) for Q4 2024 declined to $201 million, down from $223 million in the same quarter last year, primarily due to changes in business mix.
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