Reinsurance Group of America, Inc. (RGA), has revealed its financials for the fourth quarter and throughout 2023.
The company reported fourth-quarter net income available to RGA shareholders at $158 million, or $2.37 per diluted share, marking a decrease from the prior-year quarter which stood at $291 million, or $4.30 per diluted share.
Adjusted operating income for the fourth quarter stood at $316 million, or $4.73 per diluted share, slightly surpassing the $312 million, or $4.60 per diluted share, reported the year before. Notably, net foreign currency fluctuations had an adverse effect of $0.01 per diluted share on net income available to RGA shareholders. Consequently, there is a favorable effect of $0.04 per diluted share on adjusted operating income compared to the previous year.
Full year net income available to RGA shareholders amounted to $902 million, or $13.44 per diluted share, a significant increase from $517 million, or $7.64 per diluted share, in 2022. Adjusted operating income for the full year totaled $1.33 million, or $19.88 per diluted share, compared with $927 million, or $13.69 per diluted share the year before. Notably, net foreign currency fluctuations had an adverse effect of $0.18 per diluted share on net income available to RGA shareholders and $0.21 per diluted share on adjusted operating income compared with 2022.
In the fourth quarter, consolidated net premiums surged to $4.1 billion, a 19.2% increase over the 2022 fourth quarter. For the full year, net premiums reached $15.1 billion, marking a 15.3% increase from 2022. Excluding the net foreign currency effect, consolidated net premiums increased 16.3% for the full year. Investments also saw positive trends with a 14.8% increase in fourth-quarter investment income compared to the prior-year period, reflecting higher yields.
The effective tax rate for the quarter was 2.2% on pre-tax income and 21.5% for the full year, both below the expected range due to various factors including losses in certain higher tax jurisdictions and tax credits.
Tony Cheng, president and CEO, expressed optimism regarding the company’s future, citing positive trends and record results.
“Our financial solutions business continued to deliver very strong results across regions and product lines. We continued to see good momentum in organic business activity in the traditional business, and our in-force transactions were especially strong, with $346 million of capital deployed in the quarter. This brought our annual capital deployment into in-force transactions to $933 million, a record for RGA,” said Cheng.
“Additionally, we repurchased $50 million of common shares, bringing the full year total to $200 million. Our balance sheet remains strong, and we ended the quarter with excess capital of approximately $1.0 billion. Based on favorable business conditions and RGA’s global leadership position, we are optimistic about the future and expect to continue to deliver attractive financial results over time.”
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