Manulife Financial Corp’s chief executive on Thursday cautioned against reopening economies shut by the COVID-19 pandemic despite challenges that contributed to a 40 per cent decline in first-quarter profit for Canada’s biggest life insurer.
A “dramatic increase” in testing and contact tracing, and progress on development of treatments and a vaccine are needed before economies can begin returning to normal, CEO Roy Gori said at Manulife’s annual shareholder meeting.
“We cannot afford to get this wrong,” Gori said. “Subsequent pandemic waves could create greater economic and social devastation than we’ve already seen.”
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Investment gains this year look unlikely, and Manulife expects elevated credit losses through the recession, executives said on an analyst call earlier. The insurer will not meet its medium-term earnings-per-share growth target of 10-12 per cent this year, they said.
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Global insurance companies are seeing plunging yields slam investment returns, while the pandemic has boosted some payout expenses.