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Reinsurance Group Of America Reports Third-Quarter Results

Reinsurance Group of America, Incorporated (NYSE: RGA), a leading global provider of life reinsurance, reported third-quarter net income of $144.5 million, or $1.95 per diluted share, compared to $134.6 million, or $1.81 per diluted share in the prior-year quarter. Operating income* of $99.9 million, or $1.35 per diluted share, decreased from last year’s $138.8 million, or $1.87 per diluted share, primarily due to higher-than-expected claims in the U.S. and Australia markets as well as a claims liability increase in Australia. Certain amounts for 2011 have been adjusted for the retrospective adoption of new accounting guidance for deferred acquisition costs.

    Quarterly Results     Year-to-Date Results
($ in thousands, except per share data) 2012     2011 2012     2011
Net premiums $ 1,912,746 $ 1,776,165 $ 5,726,889 $ 5,300,971
Net income 144,475 134,602 408,904 407,466
Net income per diluted share 1.95 1.81 5.52 5.49
Operating income* 99,902 138,837 334,552 364,824
Operating income per diluted share* 1.35 1.87 4.52 4.92
Book value per share 91.18 73.15

Book value per share (excl. Accumulated Other Comprehensive Income “AOCI”)*

62.05

55.47

Total assets 39,924,013 30,736,591

* See ‘Use of Non-GAAP Financial Measures’ below

 

Consolidated net premiums increased eight percent to $1,912.7 million from $1,776.2 million in the prior-year quarter, including an adverse effect of $26.0 million from changes in foreign currency exchange rates in the current period. Investment income increased significantly to $396.8 million from $268.2 million in the year-earlier quarter, primarily attributable to a $96.2 million increase in fair value of option contracts, which are included in funds withheld at interest and support the crediting rates for equity-indexed annuities. Additionally, investment income associated with a large fixed deferred annuity coinsurance agreement, which became effective April 1, 2012, contributed to the increase.

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