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 income per diluted share||1.95||1.81||5.52||5.49|
|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|
|* 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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