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... they're not dumping LTCi.
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... they're not dumping LTCi.
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Genworth Posts $760 Million Loss as CEO Tackles Long-Term Care
2015-02-10 22:07:09.618 GMT
By Zachary Tracer
(Bloomberg) -- Genworth Financial Inc. posted a second-
straight loss as Chief Executive Officer Tom McInerney works to
turn around the company's long-term care insurance business.
The net loss of $760 million, or $1.53 a share, was fueled
by costs to set aside more funds to cover claims on long-term
care policies, the Richmond, Virginia-based insurer said Tuesday
in a statement. The results include a charge of $478 million
tied to LTC policies acquired before 1996.
McInerney, 58, is seeking to regain investor confidence
after a stock plunge of 45 percent left Genworth as the worst-
performing financial company in the Standard & Poor's 500 Index
last year. Losses at the long-term care unit, pressured by low
interest rates and higher claims costs, have overshadowed
Genworth's businesses selling life insurance and guaranteeing
mortgages.
"We're at a point at which Genworth cannot afford to lose
any more credibility with investors or analysts," Mark Palmer,
an analyst at BTIG LLC, said by phone before results were
announced. "If the company can isolate and address the issues
in long-term care, then the solid performance in the rest of the
company should be better reflected in the share price."
Since taking over at the start of 2013, McInerney has
raised premiums on long-term care policies sold in prior years
and reduced benefits and tightened underwriting for new
customers. In the third quarter, Genworth had to set aside
another $531 million in reserves for future long-term care
costs, fueling a record net loss of $844 million.
The stock fell 0.9 percent to $7.81 at 4:15 p.m. in New
York, extending its loss since Dec. 31 to 8.1 percent. Results
were released after the close of regular trading.
Junk Rated
Genworth is the largest seller of long-term care coverage,
which helps pay for home-health aides and nursing home stays.
Larger life insurers such as MetLife Inc. and Prudential
Financial Inc. have stopped offering the policies.
S&P cut Genworth's credit rating to junk level in November.
The downgrade, a day after Genworth posted third-quarter
results, could hurt sales of some products, the insurer said at
the time.
The mortgage-guaranty business has been a bright spot for
Genworth amid a home-price rebound in the U.S. The company also
backs loans in Canada and Australia.
Genworth Life Ins. Co. does NOT have a "junk" rating from S&P
originally posted by Mr_Ed
The article says:
"S&P cut Genworth's credit rating to junk level in November."
I'm sure that Genworth's shareholders are very happy that you brought this to their attention............
I have seen some large 3% naked yields on a monthly basis, a lot of volatility in the company right now. They had a terrible year last year, 3 large drops in value, from a high of 18 to a low of 6+...
Barron's: Genworth Stock Can Rise 42%