Industrial-Alliance Life Insurance Co. on Wednesday reported improved profit for the first quarter ended March 31.

Net income was $28.4 million, or 75¢ per share, compared to restated net income of $8.1 million, or 21¢ per share for the same period in 2002. The income for the quarter translates into a 13% return on equity on an annualized basis and 14.1% for the last twelve months.

Earnings for the first quarter of 2002 were affected by a $19.4 million provision the company took to cover two bonds it held in Teleglobe. Without this provision, the net restated income for the first quarter of 2002 would have been $27.5 million, or 73¢ per share.

In a statement the company said the improvement in earnings came from “the excellent results obtained in the Individual Insurance sector, which more than offset the shortfall caused by the stock market decline and by less favourable experience in the Group Insurance sector.”

Insurance and premium revenues during the quarter reached $851.9 million, a 9% increase over the same period last year. This is the highest quarterly premium volume in the Company’s history. Premiums are up in all lines of business, reflecting a good RRSP campaign, strong Group Insurance sales, a good persistency rate in the Individual Insurance sector and solid fund entries in the Group Pensions sector.


Industrial-Alliance said the embedded value as at Dec. 31, 2002. reached $1.6 billion ($43.77 per share), an increase of 8.1% compared to December 31, 2001, before the payment of dividends, and 6.5% after the payment of dividends. The embedded value/book value ratio reached 1.90, the highest rate among the companies that have disclosed their embedded value to date.

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