Hancock Reports Lower 2nd Quarter Net Income

By Staff Writer

August 01, 2002 at 08:00 PM

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NU Online News Service, Aug. 1, 6:02 p.m. – John Hancock Financial Services Inc., Boston, is reporting $98 million in net income for the second quarter on $2.3 billion in revenue, compared with $183 million in net income on $2.2 billion in revenue for the second quarter of 2001.

Operating income for the latest quarter, which excludes $94 million in investment losses and a $1.2 million restructuring charge, increased to $214 million, from $199 million.

Hancock executives are estimating the company will suffer about $200 million in defaults on bonds, commercial mortgages and agricultural mortgages in the second half due to the weakness of the economy.

Although the stock market performed poorly in the second quarter, sales of many products were strong, Hancock reports.

Revenue from new sales of long-term care insurance increased 9%, to $32 million, while revenue from new sales of universal, term and whole life increased 99%, to $29 million.

Sales of individual fixed annuities increased to $721 million, from $310 million, and sales of group annuities leaped to $198 million, from $31 million.

On the variable side, sales of variable life insurance fell 5%, to $29 million, and sales of variable annuities fell 9%, to $143 million.

Sales of guaranteed investment contracts fell 44%, to $863 million.

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