The Canadian Press

Manulife Financial Corp. (TSX:MFC) reported Thursday an $868-million profit in the fourth quarter, reversing a big loss racked up by the Canadian life insurance giant in the same period a year earlier, when it was hurt by weak equity markets.

Manulife said its net income amounted to 51¢ per common share, an improvement from a year-earlier loss of $1.87-billion, or $1.24 per share, when it recorded non-cash charges of more than $2.4 billion related to guarantees on segregated fund investment products.

Manulife attributed the improved bottom line to better equity markets and interest rates.

“Our fourth-quarter results capped off a year of many accomplishments,” Manulife chief executive Donald Guloien said in a statement Thursday.

“We have improved margins, balanced our product portfolio, announced three attractive acquisitions and continued to demonstrate good investment results in the face of challenging market conditions.”

Those positives were partially offset by reduced appraisals for its real estate, timber and agricultural property holdings. The company also completed the reorganization of its U.S. subsidiaries to bring all of its U.S operations under the Manulife umbrella.

Manulife says the reorganization improved operating efficiencies, provided a more stable capital ratio and a more diversified risk profile.

Manulife’s fourth-quarter profit was also held back by the negative impact of previous changes to it actuarial methods and by a change in Ontario tax rates.

Manulife shares were trading down nearly 3% or 5¢ to $18.94 with 2.6 million changing hands during Thursday midday trading on the Toronto Stock Exchange.