Prudential Financial, Inc announced the completion of a reinsurance transaction involving a portion of its guaranteed universal life insurance block with Wilton Re.
The deal, first disclosed on Aug. 20, 2024, is part of Prudential’s strategy to focus on higher growth and capital-efficient operations. The financial impact of the transaction remains consistent with details previously outlined by the company.
In a separate development, Prudential also disclosed the restructuring of a series of internal captive reinsurance arrangements tied to its in-force term life insurance block.
This restructuring will result in one-time pre-tax expenses of approximately US$40 million in the fourth quarter of 2024, primarily due to the extinguishment of certain financing facilities.
The company expects these changes to generate an increase in pre-tax annual adjusted operating income of approximately US$25 million beginning in 2025. Prudential said that these adjustments align with its ongoing efforts to optimize its financial operations and improve long-term performance.
In October, the firm reported its third-quarter 2024 financial results, reporting net income of US$448 million, or US$1.24 per common share.
This marks a turnaround from a net loss of US$802 million, or US$2.23 per share, in the same quarter last year. The company’s after-tax adjusted operating income was US$1.26 billion, or US$3.48 per share, down slightly from US$1.33 billion, or US$3.62 per share, in the prior-year quarter.
The book value per common share increased to US$84.47 from US$70.82 in Q3 2023, while adjusted book value per common share rose to US$98.71 from US$94.19. Prudential’s parent company maintained highly liquid assets of US$4.3 billion, consistent with the previous year’s third quarter, and assets under management reached US$1.558 trillion, up from US$1.361 trillion a year ago.
Prudential returned US$721 million in capital to shareholders during the quarter, which included US$250 million in share repurchases and US$471 million in dividends. Dividends paid were US$1.30 per common share, representing a 5% yield based on adjusted book value.
What are your thoughts on this story? Please feel free to share your comments below.
