TORONTO, Sept. 15 /CNW/ - In response to today's announcement by Lehman
Brothers Holdings Inc. ("Lehman") of its intent to file a Chapter 11
bankruptcy petition, Sun Life Financial Inc. (TSX/NYSE: SLF) today announced
that it holds $334 million par value of Lehman bond securities and
approximately $15 million net value of Lehman derivative instruments. Sun Life
Financial holds collateral security under collateral security agreements for
its net derivative exposure to Lehman.
Most of Sun Life Financial's Lehman exposure is held in segments backing
liabilities. Under Canadian accounting rules, when a bond backing liabilities
is written down in value or defaults, the actuarial assumptions about the cash
flows required to support the liabilities will change, resulting in a
strengthening of reserves with a corresponding charge to income.
Sun Life Financial currently expects to record a charge to earnings in
the third quarter of 2008 in respect of its Lehman holdings. The amount of the
charge is dependent on a number of factors, including the amount of expected
recoveries and actuarial cash flow testing which is performed following the
close of the quarter on September 30, 2008.
Sun Life Financial is a leading international financial services
organization providing a diverse range of protection and wealth accumulation
products and services to individuals and corporate customers. Chartered in
1865, Sun Life Financial and its partners today have operations in key markets
worldwide, including Canada, the United States, the United Kingdom, Ireland,
Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. As of
June 30, 2008, the Sun Life Financial group of companies had total assets
under management of CDN$413 billion.
Sun Life Financial Inc. trades on the Toronto (TSX), New York (NYSE) and
Philippine (PSE) stock exchanges under ticker symbol SLF.
For further information:
For further information: Media Relations Contact: Steve Kee, Assistant
Vice-President, Communications, Tel: (416) 979-6237, firstname.lastname@example.org;
Investor Relations Contact: Paul Petrelli, Vice-President, Investor Relations,
Tel: (416) 204-8163, email@example.com