Manulife Financial Corporation · TSX:MFC
Manulife Financial — Investor Day (June 2007)
80 slides from Manulife Financial's investor day presentation, Jun 4, 2007
Slide 1: Annual Investor Day
Annual Investor Day Monday, June 4th, 2007 9:30 a.m. – 3:00 p.m. Toronto, Ontario 200 Bloor St. East Legal Disclaimer Caution Regarding Forward-Looking Statements This document contains forward-looking statements within the meaning of the “safe harbour” provisions of Canadian provincial securities l
Slide 2: Asia and Japan: Today's Reality, Tomorrow's Vision
Asia and Japan Robert A. Cook Senior Executive Vice President and General Manager, Asia Annual Investor Day 4 June 2007 Today’s Reality, Tomorrow’s Vision A solid The growth platform engine for has been the 21st built century 4 2
Slide 3: Meaningful Customer Base; Wealth Management Opportunity
Meaningful Customer Base Customer Base Hong Kong 1.3+ million Japan 0.8+ million ASEAN 2.2+ million China & Taiwan 0.4+ million ASEAN operations include Indonesia, Singapore, The Philippines, Vietnam, 5 Malaysia and Thailand. Wealth Management Opportunity Percentage of New Business Hong Kong 75% 25%
Slide 4: Strong Proprietary Distribution; Expanding and Diversifying Distribution
Strong Proprietary Distribution Almost 25,000 Agents Across Region Hong Kong China & 3,416 Taiwan 7,288 Japan 3,616 ASEAN 10,154 7 Data as of Q1 2007. Expanding and Diversifying Distribution Alternative Distribution as a Percentage of New Sales 100% Adding new distribution agreements 75% Opportu
Slide 5: Growth in AUM; Exceptional Bottom Line Growth
Growth in AUM Assets Under Management 35 30 25 GR US$ billions 20 CA % 15 30 10 5 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Hong Kong Japan Other Asia 9 Exceptional Bottom Line Growth 700 Shareholders’ Earnings 600 500 GR US$ millions 400 CA % 27 300 200 100 0 1996 1997 1998 1999 2000
Slide 6: Strong Contribution to Earnings; Core Strengths
Strong Contribution to Earnings 1Q07 Shareholders’ Earnings Hong Kong: US$66 million Japan: US$90 million Other Asia: US$28 million 1Q07 shareholders’ earnings of US$183 million 21% of total company shareholders’ earnings in Q1 2007 All territories contributed positively to earnings 11 Core St
Slide 7: Growth Strategies for the Future
Growth Strategies for the Future 13 Executive Management Team General Manager, Asia Robert Cook Hong Kong Japan ASEAN China & Philip Taiwan Michael Huddart Geoff Crickmay Hampden-Smith Marc Sterling 14 7
Slide 8: Hong Kong – Core Strategy
Hong Kong – Core Strategy Broad range of products Build customer base through Mandatory Provident Fund Further expand Wealth Management business Expand alternative distribution channels 15 Hong Kong - Significant Base Funds under Management Almost 800,000 individual insurance policies in-f
Slide 9: Hong Kong Rationale for Future Growth; Japan Core Strategy
Hong Kong – Rationale for Future Growth Strong economy is leading to continued growth of affluent and high net worth market Opportunity to leverage large customer base Strong margins will allow us to sustain competitive position 17 Japan – Core Strategy Leverage global experience in both Ins
Slide 10: Japan – Agency Force with National Presence
Japan – Agency Force with National Presence Nationwide agency force 8 Regional Offices 98 Sales Offices 19 Japan Developing Alternative Distribution Alternative distribution now accounts for over 85% of new variable annuity sales 27 distributors with more than 3,000 branches 50 wholesalers C
Slide 11: Japan Rationale for Future Growth; China Core Strategy
Japan – Rationale for Future Growth Expansion of shelf space Foreign investors are gaining share More distribution channels opening Variable annuities through Japan Post Office Life insurance through banks 21 China – Core Strategy Aspire to be the first foreign company to truly operate o
Slide 12: China – Expanding Presence; Strong Top Line Growth
China – Expanding Presence Operations in 20 Cities Nanjing Ningbo Changzhou Zhenjiang Shanghai Beijing Changzhou Wuxi Jinan Jiaxing Shaoxing Wenzhou Chengdu Deyang Guangzhou Jiangmmen Foshan Shenzhen Dongguan Zongshan 23 China – Strong Top Line Growth Premiums and Deposits $112 1% $85 G R4 CA $72 $5
Slide 13: China Rationale for Future Growth; ASEAN Core Strategy
China – Rationale for Future Growth Basics in place for exceptional growth 9 Large population 9 Economic growth 9 Low insurance penetration Strong government relations Good people leads to successful execution 25 ASEAN – Core Strategy Diversify distribution channels Diversity of product of
Slide 14: ASEAN Rationale for Future Growth; Asia & Japan Division
ASEAN – Rationale for Future Growth Demographic and economic profile is analogous to China Economies of scale are starting to kick in Sharing / Leveraging of experience 27 Asia & Japan Division 28 14
Slide 15: Canada
Questions & Answers 29 Canada Paul Rooney Senior Executive Vice President and General Manager Annual Investor Day 4 June 2007 15
Slide 16: Canada 1Q07 Financial Highlights; Strong Earnings Growth
Canada 1Q07 Financial Highlights 22% of Total Company 1Q07 Shareholders’ Earnings Individual Insurance C$88m Individual Wealth Mgt C$83m Group Businesses C$47m Canada 1Q07 shareholders’ earnings of C$218 million Well diversified by business mix 31 Canada Strong Earnings Growth 981 809 Well-div
Slide 17: Canada Leading Franchise; Reporting Structure
Canada Leading Franchise Leading market share in key segments Strength in independent distribution History of product innovations Flexible Universal Life Segregated Funds with 100% Guarantee Preferred Underwriting Guaranteed Minimum Withdrawal Benefit 33 Canada Reporting Structure Cana
Slide 18: Individual Insurance: Growing Sales and Market Share
Individual Insurance Growing Sales and Market Share Individual Life * New Annualized Premiums Life Sales Market Share 7% 249 R1 15.2 15.1 CAG 224 232 14.1 12.5 159 11.6 134 10.3 2002 2003 2004 2005 2006 2001 2002 2003 2004 2005 2006 Individual Life Affinity *Excludes critical illness and disability
Slide 19: New Business Service; Group Benefits Premiums
Individual Insurance New Business Service Average Cycle Times 60 50 Industry Average: 37 40 30 20 10 0 Overall Jan-06 Dec-06 Average cycle times now better than industry levels 37 * Scanned to mailed in calendar days Group Benefits Premiums & Deposits % 26 5,284 5,461 R AG C Strong top line growth
Slide 20: Group Benefits Product Breadth; Individual Wealth Management
Group Benefits Excellent Product Breadth Health E-Services Dental • Drugs • Public Site • Basic Services • Hospital • Members, Administrators, • Major Restorative • Vision Advisors • Dentures • Critical Illness • Transactions, Information, • Orthodontics Convergence Life Disability • Accidental Deat
Slide 21: Manulife Bank; Group Savings and Retirement Solutions
Individual Wealth Management Manulife Bank Assets $8.3 Bank assets now exceed $8 billion % 52 GR $6.2 Low cost structure with CA industry leading efficiency $4.0 ratios $2.7 Strong rates of return $1.6 Strategic fit for advisors 2002 2003 2004 2005 2006 41 C$ Billions Group Savings and Retir
Slide 22: Looking Forward; Key Strategies
Looking Forward Continued focus on Increase emphasis core strengths: on: Distribution Leveraging our Product customer base innovation Collaboration across Service our businesses excellence High growth- Strategic potential markets acquisitions New markets 43 Looking Forward Key Strate
Slide 23: Collaborate Across Businesses
Collaborate Across Businesses Leveraging our Client Base Segment Customer Base Group Benefits > 3 million in-force certificates GSRS Almost 600,000 certificates Individual Wealth > 1 million in-force contracts Management Individual Life 1.6 million in-force policies Affinity Markets > 600,000 in-for
Slide 24: Innovative Products; Expanding Markets; Efficiency
Innovative Products & Services Expanding our Markets Target key market segments across product lines Baby boomers, small business, immigrant market Create new concepts Explore new markets and opportunities to ‘make the market’ Guaranteed Minimum Withdrawal Benefit Long Term Care Transi
Slide 25: Value and Excellent Service; Distribution Expansion
Value and Excellent Service Opportunity to differentiate ourselves by service Individual Life: Service improvements 9 Average cycle time reduced from 55 days to approximately 30 Further progress expected in 2007 9 UL statement awarded Dalbar’s top honour – only “excellent” rating in Canada I
Slide 26: Independent Distribution; In Summary
Distribution Expansion Independent Distribution Customers increasingly educated Increasing demand for independent advice Financial planner model evolving Focus on servicing distributors Technology to enhance service Launch of ‘Insight’ platform favourably received by brokers 51 In Summar
Slide 27: Investments
Questions & Answers Investments Donald Guloien Senior Executive Vice President and Chief Investment Officer Annual Investor Day 4 June 2007 27
Slide 28: Two Highly Synergistic Mandates; Managing General Account
Two Highly Synergistic Mandates 1) Source and manage assets for the company’s general account A variety of total return and spread mandates Well diversified mix of assets C$176 billion at March 31, 2007 2) Source and manage assets for a variety of third-party customers Total return mandates
Slide 29: Portfolio Diversification Creates Value and Controls Risk
Portfolio Diversification Creates Value and Controls Risk 14 12 Oil & Gas Enhanced Efficient Frontier Private equity Expected Return (%) 10 Timber Public equity MFC Mix Agriculture Infrastructure Real estate 8 High yield Mortgages Fixed Income Efficient Frontier 6 US Canada Bonds Bonds Typical U.S.
Slide 30: Diversified, High Quality Asset Mix
Portfolio Diversification Creates Value and Controls Risk US CDN Public Real Private Oil & Infra Bond Bond Mort Hi-Yld Equities Estate Equity Gas Timber Agri structure US Bond CDN Bond 0.64 Mortgages 0.96 0.61 Hi-Yld 0.09 0.14 0.04 Public Equities 0.18 0.27 0.14 0.29 Real Estate 0.39 -0.19 0.42 -0.1
Slide 31: Bond Portfolio: High Quality and Diversified
Bond Portfolio High Quality and Diversified Total Portfolio C$105.2 billion 77% Public Bonds AAA/ 23% Private Placements AA /A 72% 96% Investment grade BBB Average credit quality “A+” 24% Highly diversified by geography BB & U.S. 54%, Canada 26%, Japan 3%, Below Other 17% 4% Highly d
Slide 32: Improving Credit Quality; De-Risking of Bond Portfolio
Improving Credit Quality Continued De-Risking of Bond Portfolio Percentage of Total Bonds 40 JHF Acquisition 31.7% 31.1% 30 26.3% 25.3% 24.3% C$ billion 20 16.9% 10 6.9% 6.1% 5.6% 3.9% 4.3% 4.0% 0 Mar '04 (1) Jun '04 Dec '04 Dec '05 Dec '06 Mar' 07 BBB Below Investment Grade (1) MFC Pre-merger 63 Im
Slide 33: Bond Credit Quality; Mortgage Portfolio
Bond Credit Quality Improving Trend Arithmetic Weighted Average Credit Quality AA AA- A+ A A- BBB+ Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 04 04 04 05 05 05 05 06 06 06 06 07 65 Mortgage Portfolio High Quality, Diversified Portfolio 77% commercial mortgages Distribution by Market BV C$27.6 Billion E
Slide 34: Public Equities; Why Invest in Alternative Assets?
Public Equities: Highly Diversified & Outperforming Benchmark Distribution by Market Portfolio Return MV C$11.9 billion 30% 25.3% 24.8% Canada U.S. 25% 36% 36% 20% 17.5% 16.5% 16.9% 14.8% 15% 12.7% 11.8% 10% 5% Japan Other 9% 0% 19% 2003 2004 2005 2006 MFC* Benchmark 67 As at March 31, 2007 *Benchma
Slide 35: Alternative Assets; Real Estate
Alternative Assets A Broader Range of Assets 2003 - C$5 billion 2006 - C$12 billion Agriculture Other Oil and Gas Timber Oil and Gas Private Equity and Power & Mezzanine Infrastructure Commercial Private Equity Real Estate and Commercial Mezzanine Real Estate 69 Real Estate High Quality and Strong R
Slide 36: Timber Assets; Agricultural Assets
Timber Assets: Strong Returns from Non-correlated & Diversified Assets Hancock Timber Resource Group Holdings by Region US$6.7 billion AUM New Zealand & Australia 3.8 million acres of timberland, 35% Other 3% roughly 16% Manulife and 84% 3rd party Globally diverse . Outperformed NCREIF U.S.
Slide 37: Private Equity & Mezzanine; Oil & Gas
Private Equity & Mezzanine Financing Over C$2 billion managed Power & Infrastructure for Manulife’s general Industry Diversification account Includes C$1 billion in Maintenance Power & Infrastructure Services 3% private equity Other 5% Gas Storage & Five year total return: Production mid to hi
Slide 38: Third Party Asset Management Business
Third Party Asset Management Business Business Diversity Diverse and sizeable institutional businesses Assets managed: equities, bonds, structured products, oil and gas, timber and farmland Sold to institutions, closed-end funds, pension funds and retail customers Major offices in Toronto, B
Slide 39: MFC Global Funds International Recognition
MFC Global Funds 2006 International Recognition JH Large Cap Equity Fund • #3 in its category – The Wall Street Journal JH Large Cap Intrinsic Value Fund • #5 in its category – WSJ JH Small Cap Intrinsic Value Fund • #5 in its category – WSJ E&P Core Canadian Equity Fund • Best 3-yr risk-adjusted re
Slide 40: Significant Growth Opportunities; In Summary
Significant Growth Opportunities United States Performance Penetration of Variable Annuity /401K platform Lifestyle / Lifecycle funds Canada Global funds Asia Global funds China funds Japan New mutual fund/variable annuity opportunities 79 Global Income Products In Summary Balanced
Slide 41: Financial Overview
Questions & Answers Financial Overview Peter Rubenovitch Senior Executive Vice President and Chief Financial Officer Annual Investor Day 4 June 2007 41
Slide 42: Highlights; Exceptional Top Line Growth
Highlights Exceptional track record of revenue and earnings growth Quality earnings and conservative balance sheet Wealth businesses gaining momentum Significant excess capital Excellent growth platform 83 Exceptional Top Line Growth 2006 premiums and deposits of $65 billion + Record new
Slide 43: Record Funds Under Management; Bottom Line Growth
Record Funds Under Management Record funds under management + Strong sales + Rising equity markets $414 $426 $371 $347 9% +1 GR CA $143 $154 $138 $120 $108 $94 $79 $72 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 1Q07 General Fund Segregated Funds Mutual Funds and Other 85 C$ in billions
Slide 44: ROE Performance; Financial Highlights
ROE Performance 16.8% Return on Common Shareholders’ Equity in 2006 JHFS Acquisition 20.0% 17.7% 17.3% 16.8% 16.1% 16.2% Target 16.0% 15.1% ROE 13.6% 14.0% 13.7% 14.1% 12.4% 12.9% 12.0% 8.0% 4.0% 0.0% 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 1Q07 87 1Q07 ROE excludes $69 million non ca
Slide 45: Earnings Quality; Profitable Sales Growth
Earnings Quality Source of earnings highlights strong earnings quality $6,000 Earnings on surplus Experience gains $4,000 Expected profit from in- force business $2,000 Impact from new business Mgt actions, assumption changes $0 Other Income taxes -$2,000 2002 2003 2004 2005 2006 89 C$ Millions Stro
Slide 46: Growing Wealth Businesses
Growing Wealth Businesses Earnings by Type of Business 50% 46% 54% 69% 63% 13% 15% 8% 11% 12% 35% 38% 41% 26% 20% 2002 2003 2004 2005 2006 Wealth Management Other Insurance 91 Other represents earnings from Corporate & Other and Reinsurance. Wealth Management Excellent Retention Strong Growth in Net
Slide 47: Wealth Management Growth; Conservative Balance Sheet
Wealth Management Strong Business Growth Strong growth in funds under management Increasing fee income 1.5% 1.4% 1.3% $240 $201 $178 2004 2005 2006 FUM Fee Income as a % of FUM C$ Billions 93 Data excludes JH Institutional fixed products. Conservative Balance Sheet Low Leverage Debt to capital r
Slide 48: Conservative Balance Sheet: PfADs
Conservative Balance Sheet General Account PfAD as % of General Account Actuarial Liabilities 20.0 18.4 % 16.3 % 15.3 % 15.2 % 15.0 14.2 % 10.0 5.0 0.0 2002 2003 2004 2005 2006 Manulife general account PfADs are at high end of historic ranges despite JHF acquisition, which more than doubled the bala
Slide 49: Capital Ratios; Move Towards Economic Capital
Conservative Balance Sheet Manulife Financial John Hancock Life Insurance Manufacturer’s Life Insurance Company Company December 31/06 March 31/07 RBC Ratio 370% MCCSR 232% Regulatory Min. 100% Regulatory Min. 120% 97 Move Towards Economic Capital Progressing towards using economic capital as an a
Slide 50: Economic Capital: Manulife's Definition
Economic Capital Manulife’s Definition Amount of capital required to cover extreme experience scenarios within a target confidence level and time frame To cover losses over time frame with sufficient assets to support liabilities at end Economic capital principles include: 99.98% confidence
Slide 51: Economic Capital: Status of Models; Initial Findings
Economic Capital Status of Economic Capital Models Current Status Market and credit risk models developed Insurance risk models under development; using MCCSR proxies Operational risk based on factors Independent vetting in process Founded on CGAAP valuation models, with embedded reviews
Slide 52: Returning Capital to Shareholders
Returning Capital to Shareholders Approximately 70% of 2006 Earnings Returned to Shareholders $ millions 3,000 100% 80% 2,000 60% 40% 1,000 20% 0 0% 2003 2004 2005 2006 Common Dividends Share Buybacks Capital Returned as a % of Earnings 10 3 Returning Capital to Shareholders Consistent Growth in Com
Slide 53: Delivering Shareholder Value; In Summary
Delivering Shareholder Value 500 450 MFC up 353% on TSX 400 350 300 S&P/TSX Financials up 219% 250 200 S&P/TSX Composite Index up 99% 150 100 50 0 0 1 2 3 4 5 6 7 99 00 01 02 03 04 05 06 -0 -0 -0 -0 -0 -0 -0 -0 p- p- p- p- p- p- p- p- ar ar ar ar ar ar ar ar Se Se Se Se Se Se Se Se M M M M M M M M 7
Slide 54: John Hancock U.S. Division
Questions & Answers John Hancock U.S. Division John DesPrez III President and Chief Executive Officer John Hancock Financial Services Annual Investor Day 4 June 2007 54
Slide 55: U.S. Division 1Q07 Financial Highlights
U.S. Division 1Q07 Financial Highlights 1Q07 Shareholders’ Earnings U.S. Insurance: US$121m U.S. Wealth Management: US$285m U.S. Division 1Q07 shareholders’ earnings of US$406 million Represented 48% of total company earnings in 1Q07 10 9 U.S. Division Shareholders’ Net Income Excellent Track Re
Slide 56: U.S. Division Funds Under Management; Top Line Growth
U.S. Division Funds Under Management Strong Growth in Funds Under Management % 47% R8 GR AG A rC rC Yea 4 Yea 2 $221.3 $200.4 $188.1 $61.4 $46.8 2002 2003 2004 2005 2006 U.S. Insurance U.S. Wealth Management 11 US$ billions 1 U.S. Division Strong Top Line Growth Insurance Sales $907 New Annualized P
Slide 57: U.S. Division Reporting Structure; Building on Strength
U.S. Division Financial Reporting Structure U.S. Wealth Management U.S. Insurance Variable Mutual Retirement Institutional Retail JH Life JH LTC JHFN Annuities Funds Plan Services Fixed Fixed U.S. Administration (Distribution, Finance, Law, HR, Branding & Communications, Community and Government Rel
Slide 58: U.S. Wealth Management: Leveraging Competitive Strengths
U.S. Wealth Management John Hancock Wealth Management Leveraging Competitive Strengths Leverage distribution across business lines Industry leading ‘AAA’ rating from Standard & Poor’s Product development across multiple business lines Strengths in investment platform across businesses 11 6 5
Slide 59: John Hancock Variable Annuities
John Hancock Variable Annuities John Hancock Variable Annuities Expanded Distribution JP Morgan Chase Morgan Stanley Expanded Product Offering Venture Vision Upgraded Living Benefit New Investment Offerings Strongest Financial Ratings ‘AAA’ rating from Standard & Poor’s 11 8 59
Slide 60: Growth in Variable Annuity Sales
John Hancock Variable Annuities Growth in Variable Annuity Sales Monthly Variable Annuity Sales $940 ase Incre 25% Oct Nov Dec Jan Feb Mar Apr May 2006 2007 Estimate 11 US$ Millions 9 John Hancock Variable Annuities Exceptional Sales Performance Sales Growth Outpaces Industry JH VA CAGR 13% $280 $10
Slide 61: Variable Annuities Sales by Channel; Fund of Funds Share
John Hancock Variable Annuities Sales by Distribution Channel 2006 Sales by Distribution Channel 26% 7% 53% 14% Sales % Increase 2005 2006 Y/Y Bank 1,062 1,280 21% Regional 449 617 37% Wirehouse 1,927 2,336 21% Financial Planner 4,464 4,882 9% Total Sales $7,902 $9,115 15% 12 US$ millions 1 John Han
Slide 62: John Hancock Retirement Plan Services
John Hancock Retirement Plan Services John Hancock Retirement Plan Services Continue to dominate small plan market 30%1 market share < 100 participant per plan Strong sales and client retention 2006 premiums and deposits up 26% YoY Average participant contributions continued to increase, r
Slide 63: Retirement Plan Services: Sales, Net Flows, FUM
John Hancock Retirement Plan Services Sales and Net Flows Re-enrollment rate of 171%1 US$ Million 6,000 14% 5,000 C AGR lows 4,000 Net F 3,000 2,000 1,000 0 2001 2002 2003 2004 2005 2006 Net Flows Gross Sales 1 Re-enrollment rate for YTD 1Q07. Measure of new participants versus those leaving. 12 5 J
Slide 64: Retirement Plan Services Sales and Growth Strategy
John Hancock Retirement Plan Services Sales Growth Sales by Market Segment (US$ Billion) 2 2% 5 AGR -M arket C Mid 4 3 2 1 0 2001 2002 2003 2004 2005 2006 Mid-Market Small Plan Market Mid-market defined as plans with >$3M in assets and >500 participants 12 7 John Hancock Retirement Plan Services Gro
Slide 65: John Hancock Mutual Funds Growth Strategy
John Hancock Mutual Funds John Hancock Mutual Funds Growth Strategy Continue to expand distribution capabilities Increase number of business consultants to 80 Add to Platform Group calling on broker/dealer analysts/gatekeepers Continue to extend to new distribution partners Continue to bui
Slide 66: Mutual Funds: Expanded Distribution; Sales Diversification
John Hancock Mutual Funds Expanded Distribution Continuing Sales growth correlated with increase in number of business consultants 78 BCs Sales Today! US$ Billion $8 $7.6 60 Sales ($B) # of Business Consultants $7 BCs 50 $6 $5.2 40 $5 $4 30 $2.9 $3 20 $2 10 $1 $0 0 2004* 2005 2006 13 *Sales since
Slide 67: Mutual Funds: Lifestyle Portfolios Momentum
John Hancock Mutual Funds Momentum Building in Lifestyle Portfolios Lifestyle Sales Since Inception $251 78% increase in $212 average daily Lifestyle $199 $175 sales $139 Lifestyle funds are John Hancock’s second-best selling $41 fund 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 13 US$ millions 3 John Hancock
Slide 68: Mutual Fund Awards; Independent Distribution Partners
John Hancock Mutual Funds Awards and Accolades Service Marketing AWARD WINNING Communications Programs Wholesaling TOP 4 High Quality Wholesaler Interaction Top 10 Web sites for Financial Intermediaries Web Site BEST Online Innovation 13 BEST Advisor Website 5 John Hancock Wealth Management Strength
Slide 69: Lifestyle & Lifecycle Funds; U.S. Insurance
John Hancock Wealth Management Lifestyle U.S. Division& Lifecycle Funds Shareholders’ Net Income Lifestyle/Lifecycle AUM (US$ billions) $50 $45 $40 51% $30 CAGR $30 $20 $20 $13 $10 $6 $7 $0 2001 2002 2003 2004 2005 2006 Lifestyle Aggressive Lifestyle Growth $326 $301 Lifestyle Balanced Lifestyle Mod
Slide 70: John Hancock Life: Sales Post Acquisition; Growth Strategy
John Hancock Life Strong Sales Post Acquisition New Annualized Premium 800 CA GR Strong sales growth 18 % across all channels post 600 JH acquisition Decline in 1Q07 sales 400 reflects recent price increases in Universal Life 200 Key UL competitors have announced price increases 0 2004 2005 20
Slide 71: John Hancock Life Core Strategy; Best Part of Market
John Hancock Life Core Strategy is Sound Strategy Component Actions Build competitive product Competitive portfolio in all key portfolio with continuous new product categories introductions 80% of portfolio new or re-priced in 2007 Enhance strong distribution Expanded wholesaling force will relation
Slide 72: Success in VUL Market; Long Term Care
John Hancock Life Success in VUL Market JH Variable Universal Life Sales 140 44% % Continued momentum in VUL 120 ++66 100 New product features 80 Marketing campaign 60 % Distribution resources ++1177% 40 Service enhancements 20 0 2005 2006 YTD06 YTD07 14 US$ millions. Data excludes COLI. YTD
Slide 73: Long Term Care Strategy; Retail Growth
John Hancock Long Term Care Strategy Builds on Existing Foundations Product leadership in all key market segments Retail: Custom Care II, Leading Edge Multi-life Retail: Corporate Solutions Small Group: Corporate Choice Large Group: Care Choice Distribution expansion and penetration De
Slide 74: LTC Retail Sales by Distribution Channel
John Hancock Long Term Care Retail Sales by Distribution Channel Channel 1Q06 1Q07 LTC Specialists continue to drive growth; LTC Specialists 59% 61% National Accounts JHFN Brokerage 18% 17% channel developing JHFN Agent 14% 12% National Accounts 9% 10% $33 $35 $30 $28 $23 $23 $19 $20 $22 Q1'05 Q2'05
Slide 75: LTC Gaining Retail Market Share; Leading Edge Product
John Hancock Long Term Care Gaining Retail Market Share John Hancock 2005 2006 Change 1Q07 market share Sales (US$ mlns) $82 $113 39% up 54% over last year Full Year Market Share 12.4% 18.7% 51% 23.7% 20.8% 18.9% 19.4% 15.4% 13.8% 13.3% 11.3% 11.1% 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 14 Sou
Slide 76: LTC Expanding Group Business; Summary
John Hancock Long Term Care Expanding Group Business John Hancock brand attracts prestigious client list 2007 new clients Baker Hughes Bear Stearns Bristol-Myers Squibb Texas A&M University System Tyco Xerox Corporation 2007 clients add over 545,000 eligible enrollees 15 1 Summary
Slide 77: Strategic Review
Questions & Answers 15 3 Strategic Review Dominic D’Alessandro President and Chief Executive Officer Annual Investor Day 4 June 2007 77
Slide 78: Our Vision; Our Financial Objectives
Our Vision “To be the most professional life insurance company in the world: providing the very best financial protection and investment management services tailored to customers in every market where we do business.” 15 5 Our Financial Objectives Medium Term Target Return on Common Shareholders’ Eq
Slide 79: Strong & Diversified Businesses; Competitive Strengths
Strong & Diversified Businesses Asia Canada Hong Kong, Philippines, Singapore, • Individual Insurance Indonesia, Vietnam, Malaysia, Thailand, • Individual Wealth Management Taiwan, China • Group Benefits • Individual Life Insurance • Group Pensions • Group Life & Health Insurance • Variable Annuitie
Slide 80: Significant Growth Prospects; Questions & Answers
Significant Growth Prospects Organic Capital Mergers & Growth Management Acquisitions Primary Focus Ongoing Opportunistic Dividends Buybacks 15 9 Questions & Answers 80