Great-West Lifeco reports third quarter 2009 results

    
    Readers are referred to the cautionary note regarding Forward-Looking
    Information and Non-GAAP Financial Measures at the end of this Release.
    

TSX:GWO

WINNIPEG, Nov. 5, 2009 /CNW/ - Great-West Lifeco Inc. (Lifeco) has reported net income attributable to common shareholders of $445 million for the three months ended September 30, 2009, compared to $436 million in 2008. On a per common share basis, this represents $0.471 per common share for the three months ended September 30, 2009, compared to $0.487 per common share for 2008.

For the nine months ended September 30, 2009, net income attributable to common shareholders was $1,184 million, compared to $1,493 million a year ago. On a per common share basis, this represents $1.254 per common share for the nine months ended September 30, 2009, compared to $1.717 per common share for 2008.

Net income of $1,493 million for the nine months ended September 30, 2008 represents adjusted net income from continuing operations and, as such, excludes certain items as described in the United States section of this Release. Net income attributable to common shareholders, as reported, was $2,303 million, or $2.575 per common share for the nine months ended September 30, 2008.

Although conditions have generally improved in 2009, the 2009 results compared to 2008 reflect the weaker global equity and credit market environment that has existed since 2007. A decline in the value of publicly traded and other investment securities through September 30, 2009, compared to 2008, has lowered the aggregate market value of assets invested in the Company's segregated and mutual funds. In the third quarter of 2009, the impact of lower equity markets on fee income and actuarial liabilities was modest, resulting in a decrease in net income attributable to common shareholders of $0.01 per common share compared to the third quarter of 2008. Great-West Life did not need to establish any actuarial reserves with respect to segregated fund guarantees at September 30, 2009.

At September 30, 2009, provisions for future credit losses in actuarial liabilities totaled $2,492 million, compared to $2,514 million at June 30, 2009. In the quarter, the Company increased provisions by $112 million almost entirely as a result of credit rating downgrade activity in the quarter. This reduced net income attributable to common shareholders by $86 million after-tax, or $0.09 per common share after adjusting for pass-through features and minority interests.

At September 30, 2009, consolidated invested assets were $103.7 billion. The gross book value of impaired investments at that date was $400 million, against which the Company had recorded cumulative impairment provisions of $243 million. The aggregate of the $243 million impairment provisions against invested assets and the $2,492 million provision for future credit losses in actuarial liabilities represented 2.9% of bond and mortgage assets at September 30, 2009.

Consolidated assets under administration at September 30, 2009 were $454.9 billion, up $12.9 billion from December 31, 2008.

    
    Highlights

    -   Sales in Canada of individual life insurance products in the quarter
        were 15% higher than 2008 owing to a 29% increase in sales of
        participating whole life insurance.
    -   In Canada, the Company launched new segregated fund products in
        October, including a Guaranteed Minimum Withdrawal Benefit (GMWB)
        product.
    -   The Company completed the transfer of assets from the Fidelity
        Investments Canada group retirement services business which it
        acquired in September, 2009. The total assets transferred from
        Fidelity were $1.4 billion.
    -   Sales in the U.S. Financial Services business increased 25% in the
        third quarter compared to 2008. Sales of public/non-profit plans were
        very strong in the quarter.
    -   In Putnam, net asset flows in the third quarter improved by
        US$1.5 billion compared to 2008.
    -   The Company declared a quarterly common dividend of $0.3075 per
        common share payable December 31, 2009, unchanged from the previous
        quarter. Dividends paid on common shares for the nine months ended
        September 30, 2009 were 3.4% higher than a year ago.
    -   The Company's capital position remains very strong. Lifeco's
        Canadian operating subsidiary, Great-West Life, reported a Minimum
        Continuing Capital and Surplus (MCCSR) ratio of 200% at September 30,
        2009, which did not include any benefit from the $1,230 million of
        common and preferred share capital that was raised by Lifeco in the
        fourth quarter of 2008, or the $170 million of perpetual preferred
        share capital issued in October 2009.
    

OPERATING RESULTS

Consolidated net income for Lifeco is comprised of the net income of The Great-West Life Assurance Company (Great-West Life), Canada Life Financial Corporation (CLFC), London Life Insurance Company (London Life), Great-West Life & Annuity Insurance Company (GWL&A), and Putnam Investments, LLC (Putnam), together with Lifeco's corporate results.

CANADA

Net income attributable to common shareholders for the third quarter of 2009 was $212 million compared to $251 million in 2008. Included in the third quarter results in 2009 was the mark to market adjustment on the Company's preferred shares Series D and Series E, which reduced net income attributable to common shareholders by $15 million. For the nine months ended September 30, 2009, net income attributable to common shareholders was $637 million compared to $775 million in 2008.

Investment impairment charges and provisions for future credit losses reduced net income attributable to common shareholders by $5 million in the quarter.

Total sales for the nine months ended September 30, 2009 were $6,610 million compared to $6,148 million in 2008. Sales of protection products increased over the nine months ended September 30, 2008 with Individual Life sales up 10%, while sales of Group insurance products decreased 11% over 2008.

Total assets under administration at September 30, 2009 were $113.4 billion, compared to $103.9 billion at December 31, 2008.

UNITED STATES

Net income attributable to common shareholders for the third quarter of 2009 was $68 million compared to $43 million in 2008. For the nine months ended September 30, 2009, net income attributable to common shareholders was $192 million compared to $227 million in 2008.

Investment impairment charges and provisions for future credit losses reduced net income attributable to common shareholders by $9 million in the quarter.

Net income of $227 million for the nine months ended September 30, 2008 excludes the gain on sale of GWL&A's health care business of $649 million and income from discontinued operations of $43 million as well as two non-recurring items that contributed $118 million to earnings during the first quarter of 2008.

Total sales for the nine months ended September 30, 2009 were $22.9 billion compared to $34.3 billion in 2008.

Total assets under administration at September 30, 2009 were $274.1 billion compared to $271.1 billion at December 31, 2008. Included in assets under administration at September 30, 2009 were $121.5 billion of mutual fund and institutional account assets managed by Putnam, compared to $129.0 billion at December 31, 2008.

EUROPE

Net income attributable to common shareholders for the third quarter of 2009 was $167 million compared to $140 million in 2008. For the nine months ended September 30, 2009, net income attributable to common shareholders was $364 million compared to $502 million in 2008.

Investment impairment charges and provisions for future credit losses reduced net income attributable to common shareholders by $72 million in the quarter.

Total sales for the nine months ended September 30, 2009 were $2,986 million compared to $3,655 million in 2008.

Total assets under administration at September 30, 2009 were $67.4 billion, compared to $67.0 billion at December 31, 2008.

CORPORATE

Corporate net income for Lifeco attributable to common shareholders was a charge of $2 million for the third quarter of 2009 and a charge of $9 million for the nine months ended September 30, 2009, compared to net income of $2 million for the third quarter of 2008 and a charge of $11 million for the nine months ended September 30, 2008.

QUARTERLY DIVIDENDS

At its meeting today, the Board of Directors approved a quarterly dividend of $0.3075 per share on the common shares of the Company payable December 31, 2009 to shareholders of record at the close of business December 3, 2009.

    
    In addition, the Directors approved quarterly dividends on:
    -   Series D First Preferred Shares of $0.293750 per share;
    -   Series E First Preferred Shares of $0.30 per share;
    -   Series F First Preferred Shares of $0.36875 per share;
    -   Series G First Preferred Shares of $0.325 per share;
    -   Series H First Preferred Shares of $0.30313 per share;
    -   Series I First Preferred Shares of $0.28125 per share;
    -   Series J First Preferred Shares of $0.3750 per share; and
    -   Initial dividend on Series L First Preferred Shares of $0.34829 per
        share
    all payable December 31, 2009 to shareholders of record at the close of
    business December 3, 2009.
    

For purposes of the Income Tax Act (Canada), and any similar provincial legislation, the dividends referred to above are eligible dividends.

GREAT-WEST LIFECO

Great-West Lifeco Inc. (TSX:GWO) is a financial services holding company with interests in the life insurance, health insurance, retirement savings, investment management and reinsurance businesses. The Company has operations in Canada, the United States, Europe and Asia through The Great-West Life Assurance Company, London Life Insurance Company, The Canada Life Assurance Company, Great-West Life & Annuity Insurance Company and Putnam Investments, LLC. Lifeco and its companies have nearly $455 billion in assets under administration and are members of the Power Financial Corporation group of companies.

Cautionary note regarding Forward-Looking Information

This release contains some forward-looking statements about the Company, including its business operations, strategy and expected financial performance and condition. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as "expects", "anticipates", "intends", "plans", "believes", "estimates" or negative versions thereof and similar expressions. In addition, any statement that may be made concerning future financial performance (including revenues, earnings or growth rates), ongoing business strategies or prospects, possible future Company action including statements made by the Company with respect to the expected benefits of acquisitions or divestitures are also forward-looking statements. Forward-looking statements are based on current expectations and projections about future events and are inherently subject to, among other things, risks, uncertainties and assumptions about the Company, economic factors and the financial services industry generally, including the insurance and mutual fund industries. They are not guarantees of future performance, and actual events and results could differ materially from those expressed or implied by forward-looking statements made by the Company due to, but not limited to, important factors such as sales levels, premium income, fee income, expense levels, mortality experience, morbidity experience, policy lapse rates and taxes, as well as general economic, political and market factors in North America and internationally, interest and foreign exchange rates, global equity and capital markets, business competition, technological change, changes in government regulations, unexpected judicial or regulatory proceedings, catastrophic events, and the Company's ability to complete strategic transactions and integrate acquisitions. The reader is cautioned that the foregoing list of important factors is not exhaustive, and there may be other factors, including factors set out under "Risk Management and Control Practices" in the Company's 2008 Annual Management's Discussion and Analysis and any listed in other filings with securities regulators, which are available for review at www.sedar.com. The reader is also cautioned to consider these and other factors carefully and to not place undue reliance on forward-looking statements. Other than as specifically required by applicable law, the Company has no intention to update any forward-looking statements whether as a result of new information, future events or otherwise.

Cautionary note regarding Non-GAAP Financial Measures

This release contains some non-GAAP financial measures. Terms by which non-GAAP financial measures are identified include but are not limited to "earnings before restructuring charges", "adjusted net income", "adjusted net income from continuing operations", "net income - adjusted", "earnings before adjustments", "constant currency basis", "premiums and deposits", "sales", and other similar expressions. Non-GAAP financial measures are used to provide management and investors with additional measures of performance. However, non-GAAP financial measures do not have standard meanings prescribed by GAAP and are not directly comparable to similar measures used by other companies. Please refer to the appropriate reconciliations of these non-GAAP financial measures to measures prescribed by GAAP.

    
    Further information
    Selected financial information is attached.

    Great-West Lifeco's third quarter conference call will be held Thursday,
November 5 at 3:30 p.m. (Eastern). The call can be accessed through
www.greatwestlifeco.com or by phone at:

    -   Participants in the Toronto area:  416-340-2220
    -   Participants from North America: 1-866-226-1798
    -   Participants from Overseas:  Dial international access code first,
        then 800-2787-2090
    

A replay of the call will be available from November 5 to November 12, 2009, and can be accessed by calling 1-800-408-3053 or 416-695-5800 in Toronto (passcode: 4003484 followed by the number sign).

Additional information relating to Lifeco, including the most recent interim unaudited financial statements, interim Management's Discussion and Analysis (MD&A), and CEO/CFO certificates will be filed on SEDAR at www.sedar.com.

    
                       FINANCIAL HIGHLIGHTS (unaudited)
                   (in $ millions except per share amounts)

                               As at or for the                For the
                              three months ended          nine months ended
                       ------------------------------------------------------
                       September     June    September  September  September
                        30, 2009   30, 2009   30, 2008   30, 2009   30, 2008
    -------------------------------------------------------------------------
    Premiums and
     deposits:
    Life insurance,
     guaranteed
     annuities and
     insured health
     products          $   4,336  $   4,664  $   3,912  $  13,709  $  25,225
    Self-funded
     premium
     equivalents
     (ASO contracts)         610        639        583      1,867      1,795
    Segregated funds
     deposits:
      Individual
       products            1,236      1,699      1,982      4,193      5,771
      Group products       2,325      1,823      1,140      6,844      4,125
    Proprietary mutual
     funds and
     institutional
     deposits(1)           5,045      5,140      7,794     15,465     24,209
                       ------------------------------------------------------
    Total premiums and
     deposits             13,552     13,965     15,411     42,078     61,125
                       ------------------------------------------------------

    Fee and other income     728        666        778      2,074      2,381
    Paid or credited to
     policyholders         8,687      7,473      2,176     19,526     21,962

    Net income-common
     shareholders
      Continuing
       operations
       - adjusted(3)         445        413        436      1,184      1,493
      Discontinued
       operations
       - adjusted(2)           -          -          -          -         43
                       ------------------------------------------------------
      Net income
       - adjusted(3)         445        413        436      1,184      1,536
      Adjustments
       after tax(3)            -          -          -          -        767
                       ------------------------------------------------------
      Net income             445        413        436      1,184      2,303
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Per common share
      Basic earnings
       - adjusted(3)   $   0.471  $   0.437  $   0.487  $   1.254  $   1.717
      Adjustments
       after tax (3)           -          -          -          -      0.858
      Basic earnings       0.471      0.437      0.487      1.254      2.575
      Dividends paid      0.3075     0.3075     0.3075     0.9225     0.8925
      Book value           12.21      12.65      12.70
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Return on common
     shareholders'
     equity (12 months):
      Net income
       - adjusted(3)       13.7%      14.2%      21.4%
      Net income            2.4%       2.3%      27.1%
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
      Total assets     $ 129,813  $ 131,644  $ 127,339
      Segregated funds
       net assets         86,640     83,192     81,916
      Proprietary
       mutual
       funds and
       institutional
       net assets(4)     124,272    121,729    147,165
                       --------------------------------
      Total assets
       under
       management        340,725    336,565    356,420
      Other assets
       under
       administration(5) 114,145    105,341    107,970
                       --------------------------------
      Total assets
       under
       administration  $ 454,870  $ 441,906  $ 464,390
                       --------------------------------
                       --------------------------------
      Share capital
       and surplus     $  12,861  $  13,270  $  12,474
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    (1) Includes Putnam Investments, LLC mutual funds and institutional
        deposits, excluding Prime Money Market Fund net deposits.
    (2) Represents the operating results of GWL&A's health care business,
        which was sold effective April 1, 2008. Does not include the gain on
        sale of the health care business.
    (3) Net income, basic earnings per common share and return on common
        shareholders' equity are presented on an adjusted basis, as a non-
        GAAP financial measure of earnings performance, and reflect the
        following items in 2008:

                                                              Refer to Annual
                                           Per common share       Financial
                           Net         ------------------------   Statement
                         income        In quarter  Year-to-date     Notes
                         ----------------------------------------------------
        Q1: Gain on
             termination
             of
             reinsurance
             agreement    $ 176            $     -     $ 0.197      Note 14
            Reserve
             strengthening
             in GWL&A       (58)  $ 118          -      (0.065)      Note 2
        Q2: Gain on sale
             of GWL&A's
             health care
             business       649     649          -       0.726       Note 2
                                 -----------------------------
                                  $ 767    $     -     $ 0.858
                                 -----------------------------
                                 -----------------------------

        Return on common shareholders' equity is restated excluding non-
        recurring items from prior periods.
    (4) Excludes Putnam Prime Money Market Fund.
    (5) Other assets under administration includes both retail and
        institutional assets in which the Company only performs
        administrative or recordkeeping type services for the end client. In
        general, fee income is based on the type of services performed per
        client and does not fluctuate with asset levels.



              SUMMARIES OF CONSOLIDATED OPERATIONS  (unaudited)
                   (in $ millions except per share amounts)


                                   For the three months  For the nine months
                                    ended September 30,   ended September 30,
                                  -------------------------------------------
                                     2009       2008       2009       2008
                                  -------------------------------------------
    Income
      Premium income              $   4,336  $   3,912  $  13,709  $  25,225
      Net investment income
       (note 4)
        Regular net investment
         income                       1,591      1,539      4,718      4,539
        Changes in fair value
         on held for trading
         assets                       3,734     (2,258)     4,039     (4,793)
                                  -------------------------------------------
      Total net investment income     5,325       (719)     8,757       (254)
      Fee and other income              728        778      2,074      2,381
                                  -------------------------------------------
                                     10,389      3,971     24,540     27,352
                                  -------------------------------------------
    Benefits and expenses
      Policyholder benefits           3,918      3,732     12,653     11,855
      Policyholder dividends and
       experience refunds               382        338      1,151      1,016
      Change in actuarial
       liabilities                    4,387     (1,894)     5,722      9,091
                                  -------------------------------------------
      Total paid or credited to
       policyholders                  8,687      2,176     19,526     21,962

      Commissions                       319        332        979        984
      Operating expenses                636        661      1,927      1,932
      Premium taxes                      69         60        192        154
      Financing charges (note 6)         93         76        274        259
      Amortization of finite life
       intangible assets                 21         20         68         63
                                  -------------------------------------------

    Net income from continuing
     operations before income taxes     564        646      1,574      1,998
    Income taxes - current              (43)        95         60        435
                 - future               141         89        238         28
                                  -------------------------------------------
    Net income from continuing
     operations before
     non-controlling interests          466        462      1,276      1,535
    Non-controlling interests             4         12         40       (118)
                                  -------------------------------------------
    Net income from continuing
     operations                         462        450      1,236      1,653
    Net income from discontinued
     operations (note 2)                  -          -          -        692
                                  -------------------------------------------
    Net income                          462        450      1,236      2,345
    Perpetual preferred share
     dividends                           17         14         52         42
                                  -------------------------------------------
    Net income - common
     shareholders                 $     445  $     436  $   1,184  $   2,303
                                  -------------------------------------------
                                  -------------------------------------------

    Earnings per common share
     (note 13)
      Basic                       $   0.471  $   0.487  $   1.254  $   2.575
                                  -------------------------------------------
                                  -------------------------------------------
      Diluted                     $   0.470  $   0.485  $   1.253  $   2.563
                                  -------------------------------------------
                                  -------------------------------------------



                   CONSOLIDATED BALANCE SHEETS (unaudited)
                               (in $ millions)

                                             September   December  September
                                              30, 2009   31, 2008   30, 2008
                                             --------------------------------
    Assets
    Bonds (note 4)                           $  67,156  $  66,554  $  62,010
    Mortgage loans (note 4)                     16,974     17,444     17,159
    Stocks (note 4)                              6,355      5,394      6,054
    Real estate (note 4)                         3,133      3,188      3,230
    Loans to policyholders                       7,058      7,622      6,814
    Cash and cash equivalents                    3,046      2,850      3,333
    Funds held by ceding insurers               11,258     11,447     12,527
    Goodwill                                     5,409      5,425      6,355
    Intangible assets                            3,283      3,523      4,198
    Other assets                                 6,141      6,627      5,659
                                             --------------------------------
    Total assets                             $ 129,813  $ 130,074  $ 127,339
                                             --------------------------------
                                             --------------------------------

    Liabilities
    Policy liabilities
      Actuarial liabilities                  $  99,033  $  97,895  $  96,723
      Provision for claims                       1,253      1,466      1,368
      Provision for policyholder dividends         651        630        638
      Provision for experience rating refunds      322        310        272
      Policyholder funds                         2,321      2,326      2,244
                                             --------------------------------
                                               103,580    102,627    101,245

    Debentures and other debt instruments
     (note 7)                                    3,817      3,821      3,852
    Funds held under reinsurance contracts         122        192        164
    Other liabilities                            4,636      5,969      5,251
    Repurchase agreements                          699        334        445
    Deferred net realized gains                    140        161        160
                                             --------------------------------
                                               112,994    113,104    111,117

    Preferred shares (note 9)                      793        752        795
    Capital trust securities and debentures
     (note 8)                                      782        658        642
    Non-controlling interests
      Participating account surplus in
       subsidiaries                              2,018      2,012      1,970
      Preferred shares issued by subsidiaries      157        157        157
      Perpetual preferred shares issued by
       subsidiaries                                148        150        150
      Non-controlling interests in capital
       stock and surplus                            60         13         34

    Share capital and surplus
    Share capital (note 9)
      Perpetual preferred shares                 1,327      1,329      1,099
      Common shares                              5,747      5,736      4,733
    Accumulated surplus                          7,219      6,906      8,109
    Accumulated other comprehensive loss
     (note 14)                                  (1,482)      (787)    (1,509)
    Contributed surplus                             50         44         42
                                             --------------------------------
                                                12,861     13,228     12,474
                                             --------------------------------
    Total liabilities, share capital and
     surplus                                 $ 129,813  $ 130,074  $ 127,339
                                             --------------------------------
                                             --------------------------------



               CONSOLIDATED STATEMENTS OF SURPLUS (unaudited)
                               (in $ millions)

                                                         For the nine months
                                                          ended September 30,
                                                        ---------------------
                                                           2009       2008
                                                        ---------------------
    Accumulated surplus
    Balance, beginning of year                          $   6,906  $   6,599
    Net income                                              1,236      2,345
    Repatriation of Canada Life seed capital from
     participating policyholder account                         -          5
    Dividends to shareholders
      Perpetual preferred shareholders                        (52)       (42)
      Common shareholders                                    (871)      (798)
                                                        ---------------------
    Balance, end of period                              $   7,219  $   8,109
                                                        ---------------------
                                                        ---------------------

    Accumulated other comprehensive loss, net of income
     taxes (note 14)
    Balance, beginning of year                          $    (787) $  (1,533)
    Other comprehensive income (loss)                        (695)        24
                                                        ---------------------
    Balance, end of period                              $  (1,482) $  (1,509)
                                                        ---------------------
                                                        ---------------------

    Contributed surplus
    Balance, beginning of year                          $      44  $      34
    Stock option expense
      Current period expense (note 11)                          6          8
                                                        ---------------------
    Balance, end of period                              $      50  $      42
                                                        ---------------------
                                                        ---------------------



         SUMMARIES OF CONSOLIDATED COMPREHENSIVE INCOME (unaudited)
                               (in $ millions)

                                   For the three months  For the nine months
                                    ended September 30,   ended September 30,
                                  -------------------------------------------
                                     2009       2008       2009       2008
                                  -------------------------------------------

    Net income                    $     462  $     450  $   1,236  $   2,345

    Other comprehensive income
     (loss), net of income taxes
      Unrealized foreign exchange
       gains (losses) on
       translation of foreign
       operations                      (767)       (36)      (897)       326
      Unrealized gains (losses) on
       available for sale assets        130        (38)       101       (195)
      Realized (gains) losses on
       available for sale assets         (6)        (6)       (35)       (34)
      Unrealized gains (losses) on
       cash flow hedges                  70        (61)       128        (71)
      Realized (gains) losses on
       cash flow hedges                   1         (1)        (9)        (1)

      Non-controlling interests           1          -         17         (1)
                                  -------------------------------------------
                                       (571)      (142)      (695)        24
                                  -------------------------------------------
    Comprehensive income          $    (109) $     308  $     541  $   2,369
                                  -------------------------------------------
                                  -------------------------------------------


    Income tax (expense) benefit
     included in other comprehensive
     income

                                   For the three months  For the nine months
                                    ended September 30,   ended September 30,
                                  -------------------------------------------
                                     2009       2008       2009       2008
                                  -------------------------------------------

      Unrealized foreign exchange
       gains (losses) on
       translation of foreign
       operations                 $       -  $       -  $      (1) $       -
      Unrealized gains (losses) on
       available for sale assets        (42)        25        (48)        81
      Realized (gains) losses on
       available for sale assets          -          3          6         12
      Unrealized gains (losses) on
       cash flow hedges                 (38)        33        (69)        39
      Realized (gains) losses on
       cash flow hedges                   -          1          5          1
      Non-controlling interests           5         (3)         5         (3)
                                  -------------------------------------------
                                  $     (75) $      59  $    (102) $     130
                                  -------------------------------------------
                                  -------------------------------------------



              CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
                               (in $ millions)

                                   For the three months  For the nine months
                                    ended September 30,   ended September 30,
                                  -------------------------------------------
                                     2009       2008       2009       2008
                                  -------------------------------------------

    Operations
      Net income                  $     462  $     450  $   1,236  $   2,345
      Adjustments:
        Change in policy
         liabilities                  4,277     (3,131)     5,505     (4,581)
        Change in funds held by
         ceding insurers                127      1,605        337      2,106
        Change in funds held under
         reinsurance contracts          (27)        (6)       (38)       (12)
        Change in current income
         taxes payable                 (149)      (333)      (356)       (44)
        Future income tax expense       141         89        238         28
        Gain on disposal of
         business, after tax
         (note 2)                         -          -          -       (649)
        Changes in fair value of
         financial instruments       (3,720)     2,259     (3,993)     4,802
        Other                          (377)      (208)      (373)    (1,563)
                                  -------------------------------------------
      Cash flows from operations        734        725      2,556      2,432

    Financing Activities
      Issue of common shares              6         15         11         24
      Partial repayment of five
       year term facility in
       subsidiary                         -          -          -       (198)
      Issue of subordinated
       debentures in subsidiary           -          -          -        500
      Repayments on credit facility       -          -          -     (1,886)
      Increase in (repayment of)
       line of credit in subsidiary     (17)        73        165        143
      Increase in (repayment of)
       debentures and other debt
       instruments                       31        (33)        (1)       (30)
      Dividends paid                   (307)      (289)      (923)      (840)
                                  -------------------------------------------
                                       (287)      (234)      (748)    (2,287)

    Investment Activities
      Bond sales and maturities       4,325      5,166     14,762     13,974
      Mortgage loan repayments          504        524      1,297      1,441
      Stock sales                       517        729      1,794      1,727
      Real estate sales                   -          -          8        198
      Change in loans to
       policyholders                    (37)       (28)       (92)      (202)
      Change in repurchase
       agreements                       531        (90)       458        185
      Acquisition of intangible
       assets                           (37)         -        (37)         -
      Disposal of business (note 2)       -          -          -      1,344
      Investment in bonds            (5,199)    (4,617)   (16,279)   (13,587)
      Investment in mortgage loans     (638)      (907)    (1,319)    (2,744)
      Investment in stocks             (462)      (635)    (1,898)    (1,998)
      Investment in real estate          (3)      (452)       (88)      (852)
                                  -------------------------------------------
                                       (499)      (310)    (1,394)      (514)

    Effect of changes in exchange
     rates on cash and cash
     equivalents                       (259)      (115)      (218)        26

    Increase (decrease) in cash and
     cash equivalents                  (311)        66        196       (343)

    Cash and cash equivalents from
     continuing operations,
     beginning of period              3,357      3,267      2,850      3,676
                                  -------------------------------------------

    Cash and cash equivalents from
     continuing operations, end
     of period                    $   3,046  $   3,333  $   3,046  $   3,333
                                  -------------------------------------------
                                  -------------------------------------------



    Notes to Consolidated Financial Statements (unaudited)
    (in $ millions except per share amounts)

    1.  Basis of Presentation and Summary of Accounting Policies

        The interim unaudited consolidated financial statements of Great-West
        Lifeco Inc. (Lifeco or the Company) at September 30, 2009 have been
        prepared in accordance with Canadian generally accepted accounting
        principles, using the same accounting policies and methods of
        computation followed in the consolidated financial statements for the
        year ended December 31, 2008 except as noted below. These interim
        consolidated financial statements should be read in conjunction with
        the consolidated financial statements and notes thereto in the
        Company's annual report dated December 31, 2008.

        The preparation of financial statements in conformity with Canadian
        generally accepted accounting principles requires management to make
        estimates and assumptions that affect the reported amounts of assets
        and liabilities and disclosure of contingent assets and liabilities
        at the balance sheet date and the reported amounts of revenues and
        expenses during the reporting period. The valuation of actuarial
        liabilities, certain financial assets and liabilities, goodwill and
        indefinite life intangible assets, income taxes and pension plans and
        other post retirement benefits are the most significant components of
        the Company's financial statements subject to management estimates.

        The year to date results of the Company reflect management's
        judgments regarding the impact of prevailing global credit, equity
        and foreign exchange market conditions. Financial instrument carrying
        values currently reflect the illiquidity of the markets and the
        liquidity premiums embedded in the market pricing methods the Company
        relies upon.

        The estimation of actuarial liabilities relies upon investment credit
        ratings. The Company's practice is to use third party independent
        credit ratings where available. Credit rating changes may lag
        developments in the current environment. Subsequent credit rating
        adjustments will impact actuarial liabilities.

        In addition to the Company's direct investments in certain financial
        institutions, the Company has contractual business relationships with
        these financial institutions. Given the current uncertainty
        associated with these entities, normal business conditions do not
        prevail and the Company's contractual business relationships may be
        impacted.

        Given the uncertainty surrounding the continued volatility in these
        markets, and the general lack of liquidity in financial markets, the
        actual financial results could differ from those estimates.

        (a) Changes in Accounting Policy

            Goodwill and Intangible Assets
            ------------------------------
            Effective January 1, 2009, the Company adopted the Canadian
            Institute of Chartered Accountants (CICA) Handbook Section
            3064, Goodwill and Intangible Assets. This section replaces
            existing Section 3062, Goodwill and Other Intangible Assets,
            and Section 3450, Research and Development Costs. This section
            establishes new standards for the recognition and measurement
            of intangible assets, but does not affect the accounting for
            goodwill. As a result of the adoption of the new requirements
            software costs previously included in other assets have been
            reclassified to intangible assets and amortization on software
            costs previously included in operating expenses has been
            reclassified to amortization of finite life intangible assets.

        (b) Comparative Figures

            Certain of the 2008 amounts presented for comparative purposes
            have been reclassified to conform to the presentation adopted
            in the current year as a result of the reclassifications in
            note 1(a) and certain other reclassifications. On the
            Consolidated Balance Sheets these reclassifications resulted in
            a decrease to other assets of $138 with a corresponding
            increase to intangible assets at September 30, 2008 and a
            decrease to other assets of $151 at December 31, 2008 with a
            corresponding increase to intangible assets. On the Summaries
            of Consolidated Operations these reclassifications resulted in
            a decrease to operating expenses of $24, an increase to the
            amortization of finite life intangible assets of $33, a
            decrease to commissions of $9 and an increase in total paid or
            credited to policyholders of $3 with a corresponding decrease
            in income tax expense for the nine months ended September 30,
            2008.

    2.  Acquisitions and Disposals

        (a) On April 1, 2008, Great-West Life & Annuity Insurance Company
            (GWL&A) completed the sale of its health care business. After-tax
            net income of the health care business presented as discontinued
            operations on the Summaries of Consolidated Operations is
            comprised of the following:

                                                        For the     For the
                                                     three months nine months
                                                         ended       ended
                                                       September   September
                                                           30,         30,
                                                     ------------------------
                                                           2008       2008
                                                     ------------------------
            Income
              Premium income                            $       -  $     184
              Net investment income                             -         11
              Fee and other income                              -        164
                                                     ------------------------
                                                                -        359
                                                     ------------------------
              Gain on sale                                      -      1,025
                                                     ------------------------
                                                                -      1,384
                                                     ------------------------
            Benefits and expenses
              Paid or credited to policyholders and
               beneficiaries including policyholder
               dividends and experience refunds                 -        151
              Other                                             -        145
                                                     ------------------------
            Net income from discontinued operations
             before income taxes                                -      1,088
            Income taxes                                        -        396
                                                     ------------------------
            Net income from discontinued operations     $       -  $     692
                                                     ------------------------
                                                     ------------------------

            As of April 1, 2008 all of the assets and liabilities of
            operations held for sale have been sold.

        (b) On January 19, 2009, PanAgora, a subsidiary of Putnam LLC, sold
            its equity investment in Union PanAgora Asset Management GmbH to
            Union Asset Management. Gross proceeds received of approximately
            U.S. $77 resulted in a gain to Putnam LLC of approximately U.S.
            $33 after taxes and minority interests.

    3.  Restructuring Costs

        The following details the amount and status of the Putnam LLC
        restructuring program costs:

                                                            Changes
                                                                 in
                       Expected  Amounts  Amounts  Amounts  foreign   Balance
                          total utilized utilized utilized exchange September
                          costs   - 2007   - 2008   - 2009    rates  30, 2009
                       ------------------------------------------------------
        Compensation
         costs           $  133  $   (27) $   (76) $   (17) $     1  $    14
        Exiting and
         consolidating
         operations          22       (6)      (5)       -        -       11
        Eliminating
         duplicate
         systems             29       (1)       -        -        -       28
                       ------------------------------------------------------
                         $  184  $   (34) $   (81) $   (17) $     1  $    53
                       ------------------------------------------------------
                       ------------------------------------------------------

        Accrued on
         acquisition     $  154  $   (34) $   (81) $   (17) $     1  $    23
        Expense as
         incurred            30        -        -        -        -       30
                       ------------------------------------------------------
                         $  184  $   (34) $   (81) $   (17) $     1  $    53
                       ------------------------------------------------------
                       ------------------------------------------------------

    4.  Portfolio Investments

        (a) Carrying values and estimated market values of portfolio
            investments are as follows:

                              September 30, 2009
                     -----------------------------------
                        Carrying Value & Market Value
                     -----------------------------------
                                 Held for trading(1)
                      Available ------------------------
                       for sale  Designated  Classified
                     -----------------------------------
        Bonds
         - government  $   2,925  $  15,337  $      824
         - corporate       2,197     35,644         981
                     -----------------------------------
                           5,122     50,981       1,805
                     -----------------------------------

        Mortgage loans
         - residential         -          -           -
         - non-
           residential         -          -           -
                     -----------------------------------
                               -          -           -
                     -----------------------------------

        Stocks             1,399      4,629           -

        Real estate            -          -           -
                     -----------------------------------
                       $   6,521  $  55,610  $    1,805
                     -----------------------------------
                     -----------------------------------


                                         September 30, 2009
                    ---------------------------------------------------------
                                     Amortized Cost                     Total
                    ---------------------------------------------------------
                        Carrying      Market    Carrying      Market
                           Value       Value  Value Non-  Value Non-
                       Loans and   Loans and   financial   financial Carrying
                     receivables receivables instruments instruments    value
                    ---------------------------------------------------------
        Bonds
         - government  $   1,536  $   1,696  $       -  $       -  $  20,622
         - corporate       7,712      7,791          -          -     46,534
                    ---------------------------------------------------------
                           9,248      9,487          -          -     67,156
                    ---------------------------------------------------------

        Mortgage loans
         - residential     6,389      6,596          -          -      6,389
         - non-
           residential    10,585     10,575          -          -     10,585
                    ---------------------------------------------------------
                          16,974     17,171          -          -     16,974
                    ---------------------------------------------------------

        Stocks                 -          -        327        390      6,355

        Real estate            -          -      3,133      2,912      3,133
                    ---------------------------------------------------------
                       $  26,222  $  26,658  $   3,460  $   3,302  $  93,618
                    ---------------------------------------------------------
                    ---------------------------------------------------------



                               December 31, 2008
                     -----------------------------------
                        Carrying Value & Market Value
                     -----------------------------------
                                 Held for trading(1)
                      Available ------------------------
                       for sale  Designated  Classified
                     -----------------------------------
        Bonds
         - government  $   3,594  $  16,197  $     836
         - corporate       2,051     33,319        849
                     -----------------------------------
                           5,645     49,516      1,685
                     -----------------------------------

        Mortgage loans
         - residential         -          -          -
         - non-
           residential         -          -          -
                     -----------------------------------
                               -          -          -
                     -----------------------------------

        Stocks             1,411      3,653          -

        Real estate            -          -          -
                     -----------------------------------
                       $   7,056  $  53,169  $   1,685
                     -----------------------------------
                     -----------------------------------


                                       December 31, 2008
                    ---------------------------------------------------------
                                     Amortized Cost                     Total
                    ---------------------------------------------------------
                        Carrying      Market    Carrying      Market
                           Value       Value  Value Non-  Value Non-
                       Loans and   Loans and   financial   financial Carrying
                     receivables receivables instruments instruments    value
                    ---------------------------------------------------------
        Bonds
         - government  $   1,877  $   1,879  $       -  $       -  $  22,504
         - corporate       7,831      7,371          -          -     44,050
                    ---------------------------------------------------------
                           9,708      9,250          -          -     66,554
                    ---------------------------------------------------------

        Mortgage loans
         - residential     6,986      7,157          -          -      6,986
         - non-
           residential    10,458     10,414          -          -     10,458
                    ---------------------------------------------------------
                          17,444     17,571          -          -     17,444
                    ---------------------------------------------------------

        Stocks                 -          -        330        326      5,394

        Real estate            -          -      3,188      3,053      3,188
                    ---------------------------------------------------------
                       $  27,152  $  26,821  $   3,518  $   3,379  $  92,580
                    ---------------------------------------------------------
                    ---------------------------------------------------------



                              September 30, 2008
                     -----------------------------------
                        Carrying Value & Market Value
                     -----------------------------------
                                 Held for trading(1)
                      Available ------------------------
                       for sale  Designated  Classified
                     -----------------------------------
        Bonds
         - government  $   1,839  $  13,977  $     516
         - corporate       2,127     33,464      1,089
                     -----------------------------------
                           3,966     47,441      1,605
                     -----------------------------------

        Mortgage loans
         - residential         -          -          -
         - non-
           residential         -          -          -
                     -----------------------------------
                               -          -          -
                     -----------------------------------

        Stocks             1,348      4,377          -

        Real estate            -          -          -
                     -----------------------------------
                       $   5,314  $  51,818  $   1,605
                     -----------------------------------
                     -----------------------------------


                                         September 30, 2008
                    ---------------------------------------------------------
                                     Amortized Cost                     Total
                    ---------------------------------------------------------
                        Carrying      Market    Carrying      Market
                           Value       Value  Value Non-  Value Non-
                       Loans and   Loans and   financial   financial Carrying
                     receivables receivables instruments instruments    value
                    ---------------------------------------------------------
        Bonds
         - government  $   1,716  $   1,757  $       -  $       -  $  18,048
         - corporate       7,282      7,096          -          -     43,962
                    ---------------------------------------------------------
                           8,998      8,853          -          -     62,010
                    ---------------------------------------------------------

        Mortgage loans
         - residential     6,992      7,021          -          -      6,992
         - non-
           residential    10,167      9,983          -          -     10,167
                    ---------------------------------------------------------
                          17,159     17,004          -          -     17,159
                    ---------------------------------------------------------

        Stocks                 -          -        329        354      6,054

        Real estate            -          -      3,230      3,334      3,230
                    ---------------------------------------------------------
                       $  26,157  $  25,857  $   3,559  $   3,688  $  88,453
                    ---------------------------------------------------------
                    ---------------------------------------------------------

        (1) Investments can be held for trading in two ways: designated as
            held for trading at the option of management; or, classified as
            held for trading if they are actively traded for the purpose of
            earning investment income.

        (b) Included in portfolio investments are the following:

          (i) Impaired investments

                                                    September 30, 2009
                                             --------------------------------
                                               Gross                Carrying
                                               amount   Impairment   amount
                                             --------------------------------
                 Impaired amounts by type
                   Held for trading(1)       $     219  $    (141) $      78
                   Available for sale               18        (14)         4
                   Loans and receivables           153        (84)        69
                                             --------------------------------
                 Total                       $     390  $    (239) $     151
                                             --------------------------------
                                             --------------------------------

                                                      December 31, 2008
                                             --------------------------------
                                               Gross                Carrying
                                               amount   Impairment   amount
                                             --------------------------------
                 Impaired amounts by type
                   Held for trading(1)       $     160  $    (138) $      22
                   Available for sale               18        (17)         1
                   Loans and receivables            93        (60)        33
                                             --------------------------------
                 Total                       $     271  $    (215) $      56
                                             --------------------------------
                                             --------------------------------

                                                     September 30, 2008
                                             --------------------------------
                                               Gross                Carrying
                                               amount   Impairment   amount
                                             --------------------------------
                 Impaired amounts by type
                   Held for trading(1)       $     156  $    (130) $      26
                   Available for sale                7         (7)         -
                   Loans and receivables            52        (50)         2
                                             --------------------------------
                 Total                       $     215  $    (187) $      28
                                             --------------------------------
                                             --------------------------------

                 (1) Excludes amounts in funds held by ceding insurers of $10
                     and impairment of $(4) at September 30, 2009, $15 and
                     $(11) at December 31, 2008 and $15 and $(12) at
                     September 30, 2008.

         (ii) The allowance for credit losses and changes in the allowance
              for credit losses related to investments classified as loans
              and receivables are as follows:

                                    For the nine            For the nine
                                    months ended            months ended
                                 September 30, 2009      September 30, 2008
                              -----------------------------------------------
                                     Mortgage                Mortgage
                               Bonds   loans   Total   Bonds   loans   Total
                              -----------------------------------------------
    Balance, beginning of
     year                     $   31  $   29  $   60  $   34  $   19  $   53
    Net provision (recovery)
     for credit losses - in
     year                         16      21      37       1      (2)     (1)
    Write-offs, net of
     recoveries                   (1)     (2)     (3)     (6)      2      (4)
    Other (including foreign
     exchange rate changes)       (5)     (5)    (10)      1       1       2
                              -----------------------------------------------
    Balance, end of period    $   41  $   43  $   84  $   30  $   20  $   50
                              -----------------------------------------------
                              -----------------------------------------------

        (c) Net investment income is comprised of the following:

    For the three
     months ended                    Mortgage          Real
     September 30, 2009        Bonds   loans  Stocks  estate   Other   Total
    -------------------------------------------------------------------------
    Regular net investment
     income:
      Investment income
       earned                 $1,039  $  231  $   38  $   45  $  255  $1,608
      Net realized gains
       (losses) (available
       for sale)                  10       -      (4)      -       -       6
      Net realized gains
       (losses) (other
       classifications)            3       3       -       -       -       6
      Amortization of net
       realized/unrealized
       gains (non-financial
       instruments)                -       -       -      (5)      -      (5)
      Net (provision) recovery
       for credit losses
       (loans and receivables)     -      (7)      -       -       -      (7)
      Other income and expenses    -       -       -       -     (17)    (17)
                              -----------------------------------------------
                               1,052     227      34      40     238   1,591
    Changes in fair value on
     held for trading assets:
      Net realized/unrealized
       gains (losses)
       (classified held for
       trading)                   28       -       -       -       -      28
      Net realized/unrealized
       gains (losses)
       (designated held for
       trading)                3,329       -     381       -      (4)  3,706
                              -----------------------------------------------
                               3,357       -     381       -      (4)  3,734
                              -----------------------------------------------
    Net investment income     $4,409  $  227  $  415  $   40  $  234  $5,325
                              -----------------------------------------------
                              -----------------------------------------------


    For the three
     months ended                    Mortgage          Real
     September 30, 2008        Bonds   loans  Stocks  estate   Other   Total
    -------------------------------------------------------------------------
    Regular net investment
     income:
      Investment income
       earned                 $1,079  $  241  $   28  $   46  $  132  $1,526
      Net realized gains
       (losses) (available
       for sale)                   5       -      (3)      -       -       2
      Net realized gains
       (losses) (other
       classifications)           14      12      (6)      -       -      20
      Amortization of net
       realized/unrealized
       gains (non-financial
       instruments)                -       -       -       8       -       8
      Net (provision) recovery
       for credit losses
       (loans and receivables)    (1)      -       -       -       -      (1)
      Other income and expenses    -       -       -       -     (16)    (16)
                              -----------------------------------------------
                               1,097     253      19      54     116   1,539
    Changes in fair value on
     held for trading assets:
      Net realized/unrealized
       gains (losses)
       (classified held for
       trading)                    -       -       -       -       -       -
      Net realized/unrealized
       gains (losses)
       (designated held for
       trading)               (1,464)      -    (660)      -    (134) (2,258)
                              -----------------------------------------------
                              (1,464)      -    (660)      -    (134) (2,258)
                              -----------------------------------------------
    Net investment income     $ (367) $  253  $ (641)  $  54  $  (18) $ (719)
                              -----------------------------------------------
                              -----------------------------------------------


    For the nine
     months ended                    Mortgage          Real
     September 30, 2009        Bonds   loans  Stocks  estate   Other   Total
    -------------------------------------------------------------------------
    Regular net investment
     income:
      Investment income
       earned                 $3,146  $  694  $  126  $  138  $  579  $4,683
      Net realized gains
       (losses) (available
       for sale)                  45       -      (4)      -       -      41
      Net realized gains
       (losses) (other
       classifications)            4       9      83       -       -      96
      Amortization of net
       realized/unrealized
       gains (non-financial
       instruments)                -       -       -     (15)      -     (15)
      Net (provision) recovery
       for credit losses
       (loans and receivables)   (16)    (21)      -       -       -     (37)
      Other income and expenses    -       -       -       -     (50)    (50)
                              -----------------------------------------------
                               3,179     682     205     123     529   4,718
    Changes in fair value on
     held for trading assets:
      Net realized/unrealized
       gains (losses)
       (classified held for
       trading)                   28       -       -       -       -      28
      Net realized/unrealized
       gains (losses)
       (designated held for
       trading)                3,284       -     833       -    (106)  4,011
                              -----------------------------------------------
                               3,312       -     833       -    (106)  4,039
                              -----------------------------------------------
    Net investment income     $6,491  $  682  $1,038  $  123  $  423  $8,757
                              -----------------------------------------------
                              -----------------------------------------------


    For the nine
     months ended                    Mortgage          Real
     September 30, 2008        Bonds   loans  Stocks  estate   Other   Total
    -------------------------------------------------------------------------
    Regular net investment
     income:
      Investment income
       earned                 $3,066  $  705  $  146  $  123  $  419  $4,459
      Net realized gains
       (losses) (available
       for sale)                  50       -      (4)      -       -      46
      Net realized gains
       (losses) (other
       classifications)           29      23       -       -       -      52
      Amortization of net
       realized/unrealized
       gains (non-financial
       instruments)                -       -       -      28       -      28
      Net (provision) recovery
       for credit losses
       (loans and receivables)    (1)      2       -       -       -       1
      Other income and expenses    -       -       -       -     (47)    (47)
                              -----------------------------------------------
                               3,144     730     142     151     372   4,539
    Changes in fair value on
     held for trading assets:
      Net realized/unrealized
       gains (losses)
       (classified held for
       trading)                    1       -       -       -       -       1
      Net realized/unrealized
       gains (losses)
       (designated held for
       trading)               (4,029)      -    (733)      -     (32) (4,794)
                              -----------------------------------------------
                              (4,028)      -    (733)      -     (32) (4,793)
                              -----------------------------------------------
    Net investment income     $ (884) $  730  $ (591) $  151  $  340  $ (254)
                              -----------------------------------------------
                              -----------------------------------------------

    Investment income earned is comprised of income from investments that are
    classified or designated as held for trading, classified as available for
    sale and classified as loans and receivables.

    5.  Financial Instrument Risk Management

        The Company has policies relating to the identification, measurement,
        monitoring, mitigating, and controlling of risks associated with
        financial instruments. The key risks related to financial instruments
        are credit risk, liquidity risk and market risk (currency, interest
        rate and equity). The following sections describe how the Company
        manages each of these risks.

        (a) Credit Risk

            Credit risk is the risk of financial loss resulting from the
            failure of debtors making payments when due. The following
            policies and procedures are in place to manage this risk:

            - Investment guidelines are in place that require only the
              purchase of investment-grade assets and minimize undue
              concentration of assets in any single geographic area, industry
              and company.
            - Investment guidelines specify minimum and maximum limits for
              each asset class. Credit ratings are determined by recognized
              external credit rating agencies and/or internal credit review.
            - Investment guidelines also specify collateral requirements.
            - Portfolios are monitored continuously, and reviewed regularly
              with the Boards of Directors or the Investment Committees of
              the Boards of Directors.
            - Credit risk associated with derivative instruments is evaluated
              quarterly based on conditions that existed at the balance sheet
              date, using practices that are at least as conservative as
              those recommended by regulators.
            - The Company is exposed to credit risk relating to premiums due
              from policyholders during the grace period specified by the
              insurance policy or until the policy is paid up or terminated.
              Commissions paid to agents and brokers are netted against
              amounts receivable, if any.
            - Reinsurance is placed with counterparties that have a good
              credit rating and concentration of credit risk is managed by
              following policy guidelines set each year by the Board of
              Directors. Management continuously monitors and performs an
              assessment of creditworthiness of reinsurers.

          (i) Maximum Exposure to Credit Risk

              The following table summarizes the Company's maximum exposure
              to credit risk related to financial instruments. The maximum
              credit exposure is the carrying value of the asset net of any
              allowances for losses.

                                             September   December  September
                                              30, 2009   31, 2008   30, 2008
                                             --------------------------------
              Cash and cash equivalents      $   3,046  $   2,850  $   3,333
              Bonds
                Held for trading                52,786     51,201     49,046
                Available for sale               5,122      5,645      3,966
                Amortized cost                   9,248      9,708      8,998
              Mortgage loans                    16,974     17,444     17,159
              Loans to policyholders             7,058      7,622      6,814
              Other financial assets            14,702     15,004     15,863
              Derivative assets                    671        677        605
                                             --------------------------------
              Total balance sheet maximum
               credit exposure               $ 109,607  $ 110,151  $ 105,784
                                             --------------------------------
                                             --------------------------------

              Credit risk is also mitigated by entering into collateral
              agreements. The amount and type of collateral required depends
              on an assessment of the credit risk of the counterparty.
              Guidelines are implemented regarding the acceptability of types
              of collateral and the valuation parameters. Management monitors
              the value of the collateral, requests additional collateral
              when needed and performs an impairment valuation when
              applicable.

         (ii) Concentration of Credit Risk

              Concentrations of credit risk arise from exposures to a single
              debtor, a group of related debtors or groups of debtors that
              have similar credit risk characteristics in that they operate
              in the same geographic region or in similar industries. The
              characteristics are similar in that changes in economic or
              political environments may impact their ability to meet
              obligations as they come due.

              The following table provides details of the carrying value of
              bonds by industry sector and geographic distribution:

                                             September   December  September
                                              30, 2009   31, 2008   30, 2008
                                             --------------------------------
              Bonds issued or guaranteed by:
                Canadian federal government  $   2,464  $   1,867  $   1,358
                Canadian provincial and
                 municipal governments           6,231      6,029      5,591
                U.S. Treasury and other U.S.
                 agencies                        3,798      4,968      4,154
                Other foreign governments        6,245      6,854      6,035
                Government related               2,115      1,563      2,061
                Sovereign                        1,554      1,739      1,923
                Asset-backed securities          7,032      7,243      7,288
                Residential mortgage backed
                 securities                      1,015      1,156      1,002
                Banks                            5,087      5,070      5,400
                Other financial institutions     3,891      3,602      3,857
                Basic materials                    928        870        816
                Communications                   1,400      1,220      1,178
                Consumer products                4,433      4,104      3,854
                Industrial products/services     1,421      1,985      1,463
                Natural resources                2,325      1,813      1,758
                Real estate                      1,822      1,645      1,646
                Transportations                  2,587      2,497      2,444
                Utilities                        7,986      7,068      6,511
                Miscellaneous                    2,187      1,866      1,661
                                             --------------------------------
              Total long term bonds             64,521     63,159     60,000
              Short term bonds                   2,635      3,395      2,010
                                             --------------------------------
                                             $  67,156  $  66,554  $  62,010
                                             --------------------------------
                                             --------------------------------
              Canada                         $  27,578  $  26,231  $  24,085
              United States                     17,491     17,703     15,811
              Europe/Reinsurance                22,087     22,620     22,114
                                             --------------------------------
                                             $  67,156  $  66,554  $  62,010
                                             --------------------------------
                                             --------------------------------

              The following table provides details of the carrying value of
              mortgage loans by geographic location:

                                               September 30, 2009
                                  -------------------------------------------
                                     Single     Multi-
                                     family     family
                                   residen-   residen-
                                       tial       tial Commercial      Total
                                  -------------------------------------------

              Canada              $   1,743  $   4,127  $   6,350  $  12,220
              United States               -        489      1,454      1,943
              Europe/Reinsurance          -         30      2,781      2,811
                                  -------------------------------------------
              Total mortgage
               loans              $   1,743  $   4,646  $  10,585  $  16,974
                                  -------------------------------------------
                                  -------------------------------------------


                                                December 31, 2008
                                  -------------------------------------------
                                     Single     Multi-
                                     family     family
                                   residen-   residen-
                                       tial       tial Commercial      Total
                                  -------------------------------------------

              Canada              $   1,850  $   4,524  $   6,144  $  12,518
              United States               -        576      1,581      2,157
              Europe/Reinsurance          -         36      2,733      2,769
                                  -------------------------------------------
              Total mortgage
               loans              $   1,850  $   5,136  $  10,458  $  17,444
                                  -------------------------------------------
                                  -------------------------------------------


                                               September 30, 2008
                                  -------------------------------------------
                                     Single     Multi-
                                     family     family
                                   residen-   residen-
                                       tial       tial Commercial      Total
                                  -------------------------------------------

              Canada              $   1,836  $   4,606  $   6,007  $  12,449
              United States               -        519      1,259      1,778
              Europe/Reinsurance          -         31      2,901      2,932
                                  -------------------------------------------
              Total mortgage
               loans              $   1,836  $   5,156  $  10,167  $  17,159
                                  -------------------------------------------
                                  -------------------------------------------

        (iii) Asset Quality

              Bond Portfolio Quality

                                             September   December  September
                                              30, 2009   31, 2008   30, 2008
                                             --------------------------------

              AAA                            $  22,643  $  25,138  $  23,523
              AA                                10,752     10,765     11,331
              A                                 19,449     18,030     16,968
              BBB                               10,588      8,809      7,729
              BB and lower                       1,089        417        449
                                             --------------------------------
                                                64,521     63,159     60,000
              Short term bonds                   2,635      3,395      2,010
                                             --------------------------------
              Total bonds                    $  67,156  $  66,554  $  62,010
                                             --------------------------------
                                             --------------------------------

              Derivative Portfolio Quality

                                             September   December  September
                                              30, 2009   31, 2008   30, 2008
                                             --------------------------------
              Over-the-counter contracts
               (counterparty ratings):
              AAA                            $       4  $     19  $        2
              AA                                   257       165         333
              A                                    441       468         270
                                             --------------------------------
              Total                          $     702  $    652  $      605
                                             --------------------------------
                                             --------------------------------

         (iv) Loans Past Due, But Not Impaired

              Loans that are past due but not considered impaired are loans
              for which scheduled payments have not been received, but
              management has reasonable assurance of timely collection of the
              full amount of principal and interest due. The following table
              provides carrying values of the loans past due, but not
              impaired:

                                             September   December  September
                                              30, 2009   31, 2008   30, 2008
                                             --------------------------------

              Less than 30 days              $      48  $      50  $      64
              30 - 90 days                           4          4          2
              90 days and greater                   10          1          1
                                             --------------------------------
              Total                          $      62  $      55  $      67
                                             --------------------------------
                                             --------------------------------

        (b) Liquidity Risk

            Liquidity risk is the risk that the Company will not be able to
            meet all cash outflow obligations as they come due. The following
            policies and procedures are in place to manage this risk:

            - The Company closely manages operating liquidity through cash
              flow matching of assets and liabilities.
            - Management monitors the use of lines of credit on a regular
              basis, and assesses the ongoing availability of these and
              alternative forms of operating credit.
            - Management closely monitors the solvency and capital positions
              of its principal subsidiaries opposite liquidity requirements
              at the holding company. Additional liquidity is available
              through established lines of credit and the Company's
              demonstrated ability to access capital markets for funds. The
              Company maintains a $200 million committed line of credit with
              a Canadian chartered bank.

        (c) Market Risk

            Market risk is the risk that the fair value or future cash flows
            of a financial instrument will fluctuate as a result of changes
            in market factors. Market factors include three types of risks:
            currency risk, interest rate risk and equity risk.

          (i) Currency Risk

              Currency risk relates to the Company operating in different
              currencies and converting non-Canadian earnings at different
              points in time at different foreign exchange levels when
              adverse changes in foreign currency exchange rates occur. The
              following policies and procedures are in place to mitigate the
              Company's exposure to currency risk.

              - The Company uses financial measures such as constant currency
                calculations to monitor the effect of currency translation
                fluctuations.
              - Investments are normally made in the same currency as the
                liabilities supported by those investments.
              - Foreign currency assets acquired to back liabilities are
                normally converted back to the currency of the liability
                using foreign exchange contracts.
              - A 10% weakening of the Canadian dollar against foreign
                currencies would be expected to increase non-participating
                actuarial liabilities by the same amount as the supporting
                assets. A 10% strengthening of the Canadian dollar against
                foreign currencies would be expected to decrease non-
                participating actuarial liabilities by the same amount as the
                supporting assets.

         (ii) Interest Rate Risk

              Interest rate risk exists if asset and liability cash flows are
              not closely matched and interest rates change causing a
              difference in value between the asset and liability. The
              following policies and procedures are in place to mitigate the
              Company's exposure to interest rate risk.

              - The Company utilizes a formal process for managing the
                matching of assets and liabilities. This involves grouping
                general fund assets and liabilities into segments. Assets in
                each segment are managed in relation to the liabilities in
                the segment.
              - Interest rate risk is managed by investing in assets that are
                suitable for the products sold.
              - For products with fixed and highly predictable benefit
                payments, investments are made in fixed income assets that
                closely match the liability product cash flows. Protection
                against interest rate change is achieved as any change in the
                fair market value of the assets will be offset by a similar
                change in the fair market value of the liabilities.
              - For products with less predictable timing of benefit
                payments, investments are made in fixed income assets with
                cash flows of a shorter duration than the anticipated timing
                of benefit payments, or equities as described below.
              - The risk associated with the mismatch in portfolio duration
                and cash flow, asset prepayment exposure and the pace of
                asset acquisition are quantified and reviewed regularly.

              Projected cash flows from the current assets and liabilities
              are used in the Canadian Asset Liability Method (CALM) to
              determine actuarial liabilities. Cash flows from assets are
              reduced to provide for potential asset default losses. Testing
              under several interest rate scenarios (including increasing and
              decreasing rates) is done to assess reinvestment risk.

              One way of measuring the interest rate risk associated with
              this assumption is to determine the effect on the present value
              of the projected net asset and liability cash flows of the non-
              participating business of the Company of an immediate and
              permanent 1% increase and 1% decrease in interest rates at each
              future duration. These interest rate changes will impact the
              projected cash flows.

              - The effect of an immediate and permanent 1% increase in
                interest rates at each future duration would be to decrease
                the present value of these net projected cash flows by
                approximately $123.
              - The effect of an immediate and permanent 1% decrease in
                interest rates at each future duration would be to decrease
                the present value of these net projected cash flows by
                approximately $28.

        (iii) Equity Risk

              Equity risk is the uncertainty associated with the valuation of
              assets arising from changes in equity markets. To mitigate
              price risk, the Company has investment policy guidelines in
              place that provide for prudent investment in equity markets
              within clearly defined limits.

              Some policy liabilities are supported by equities (including
              real estate), for example segregated fund products and products
              with long-tail liabilities. Generally these liabilities will
              fluctuate in line with equity market values. There will be
              additional impacts on these liabilities as equity market values
              fluctuate. A 10% increase in equity markets would be expected
              to additionally decrease non-participating actuarial
              liabilities by approximately $19. A 10% decrease in equity
              markets would be expected to additionally increase non-
              participating actuarial liabilities by approximately $153.

    6.  Financing Charges

        Financing charges consist of the following:

                                   For the three months  For the nine months
                                    ended September 30,   ended September 30,
                                  -------------------------------------------
                                     2009       2008       2009       2008
                                  -------------------------------------------

        Operating charges:
          Interest on long-term
           debentures and other
           debt instruments       $       3  $       1  $       5  $       4

        Financial charges:
          Interest on long-term
           debentures and other
           debt instruments              51         47        155        173
          Dividends on preferred
           shares classified as
           liabilities                    9          9         27         27
          Unrealized losses (gains)
           on preferred shares
           classified as held
           for trading                   14          1         46          9
          Subordinated debenture
           issue costs                    -          -          -          5
          Other                           4          9          8         13
          Interest on capital
           trust debentures              13         13         37         37
          Distributions on
           capital trust
           securities held by
           consolidated group as
           temporary investments         (1)        (4)        (4)        (9)
                                  -------------------------------------------
                                         90         75        269        255
                                  -------------------------------------------
        Total                     $      93  $      76  $     274  $     259
                                  -------------------------------------------
                                  -------------------------------------------

    7.  Debentures and Other Debt Instruments

        On June 22, 2009, Putnam LLC executed a new revolving credit facility
        agreement with a Canadian chartered bank for US $500, an increase of
        US $300 from the previous agreement. At September 30, 2009, a
        subsidiary of Putnam LLC had drawn US $255 (US $120 at December 31,
        2008) on this credit facility.

    8.  Capital Trust Securities and Debentures

        During the nine months ended September 30, 2009, the Company disposed
        of $138 principal amount of capital trust securities held by the
        consolidated group as temporary investments.

    9.  Share Capital

        (a) Preferred Shares

            The Company recognized the surrender of Series E First Preferred
            shares with a carrying value of $5 and Series F First Preferred
            shares with a carrying value of $2

            The Company has designated outstanding Preferred Shares Series D
            and Series E as held for trading on the Consolidated Balance
            Sheets with changes in fair value reported in the Summaries of
            Consolidated Operations. During the nine months ended September
            30, 2009 the Company recognized unrealized gains (losses) of $(5)
            for Series D and $(41) for Series E (for the nine months ended
            September 30, 2008, $3 for Series D and $(12) for Series E). The
            redemption price at maturity is $25 per share plus accrued
            dividends.

        (b) Common Shares

            Issued and outstanding

                September 30, 2009    December 31, 2008   September 30, 2008
               --------------------------------------------------------------
                          Carrying             Carrying             Carrying
                  Number    value      Number    value      Number    value
               --------------------------------------------------------------
    Common
     shares:
    Balance,
     beginning
     of year   943,882,505  $5,736  893,761,639  $4,709  893,761,639  $4,709
    Issued from
     treasury            -       -   48,200,000   1,000            -       -
    Issued
     under stock
     option plan   814,469      11    1,920,866      27    1,759,600      24
               --------------------------------------------------------------
    Balance,
     end of
     period    944,696,974  $5,747  943,882,505  $5,736  895,521,239  $4,733
               --------------------------------------------------------------
               --------------------------------------------------------------

    10. Capital Management

        At the holding company level, the Company monitors the amount of
        consolidated capital available, and the amounts deployed in its
        various operating subsidiaries. The amount of capital deployed in any
        particular company or country is dependent upon local regulatory
        requirements as well as the Company's internal assessment of capital
        requirements in the context of its operational risks and
        requirements, and strategic plans.

        Since the timing of available funds cannot always be matched
        precisely to commitments, imbalances may arise when demands for funds
        exceed those on hand. Also, a demand for funds may arise as a result
        of the Company taking advantage of current investment opportunities.
        The sources of the funds that may be required in such situations
        include bank financing and the issuance of debentures and equity
        securities.

        The Company's practice is to maintain the capitalization of its
        regulated operating subsidiaries at a level that will exceed the
        relevant minimum regulatory capital requirements in the jurisdictions
        in which they operate.

        In Canada, the Office of the Superintendent of the Financial
        Institutions (OSFI) has established a capital adequacy measurement
        for life insurance companies incorporated under the Insurance
        Companies Act (Canada) and their subsidiaries, known as the Minimum
        Continuing Capital and Surplus Requirements (MCCSR).

        For Canadian regulatory reporting purposes, capital is defined by
        OSFI in its MCCSR guideline. The following table provides the MCCSR
        information and ratios for The Great-West Life Assurance Company
        (Great-West Life):

                                             September   December  September
                                              30, 2009   31, 2008   30, 2008
                                             --------------------------------
        Capital Available:
        Tier 1 Capital
          Common shares(1)                   $   6,116  $   6,116  $   6,116
          Shareholder surplus                    5,876      5,604      5,394
          Qualifying non-controlling
           interests                               148        150        150
          Innovative instruments                   777        648        637
          Other Tier 1 Capital Elements          1,083      1,513      1,372
                                             --------------------------------
          Gross Tier 1 Capital                  14,000     14,031     13,669

        Deductions from Tier 1:
          Goodwill & intangible assets in
           excess of limit                       5,683      5,673      5,689
          Other deductions                       1,509      1,697      1,355
                                             --------------------------------
        Net Tier 1 Capital                       6,808      6,661      6,625
        Adjustment to Net Tier 1 Capital           (43)         -          -
                                             --------------------------------
        Net Tier 1 Capital                       6,765      6,661      6,625
                                             --------------------------------

        Tier 2 Capital
          Tier 2A                                  359        345        273
          Tier 2B allowed                          300        300        500
          Tier 2C                                1,448      1,550      1,324
          Tier 2 Deductions                        (43)         -          -
                                             --------------------------------
        Tier 2 Capital Allowed                   2,064      2,195      2,097
                                             --------------------------------

        Total Tier 1 and Tier 2 Capital          8,829      8,856      8,722
        Less: Deductions/Adjustments                 -        124        127
                                             --------------------------------
        Total Available Capital              $   8,829  $   8,732  $   8,595
                                             --------------------------------
                                             --------------------------------

        Capital Required:
          Assets Default & market risk       $   1,732  $   1,510  $   1,581
          Insurance Risks                        1,831      1,800      1,711
          Interest Rate Risks                      832        803        961
          Other                                     14         50        (19)
                                             --------------------------------
        Total Capital Required               $   4,409  $   4,163  $   4,234
                                             --------------------------------
                                             --------------------------------
        MCCSR ratios:
        Tier 1                                    153%       160%       156%
                                             --------------------------------
                                             --------------------------------
        Total                                     200%       210%       203%
                                             --------------------------------
                                             --------------------------------

        (1) The $1,230 of common and preferred share capital that was raised
            by the Company in the fourth quarter of 2008 remained at the
            holding company as at September 30, 2009.

        In the United States, GWL&A is subject to comprehensive state and
        federal regulation and supervision throughout the United States. The
        National Association of Insurance Commissioners (NAIC) has adopted
        risk-based capital rules and other financial ratios for U.S. life
        insurance companies. At the end of 2008 the risk-based capital (RBC)
        ratio for GWL&A was 381%, in excess of that required by NAIC.

        As at September 30, 2009 and 2008 the Company maintained capital
        levels above the minimum local requirements in its other foreign
        operations.

        The Company is both a user and a provider of reinsurance, including
        both traditional reinsurance, which is undertaken primarily to
        mitigate against assumed insurance risks, and financial or finite
        reinsurance, under which the amount of insurance risk passed to the
        reinsurer or its reinsureds may be more limited.

        The capitalization of the Company and its operating subsidiaries will
        also take into account the views expressed by the various credit
        rating agencies that provide financial strength and other ratings to
        the Company.

        The Company has also established policies and procedures designed to
        identify, measure and report all material risks. Management is
        responsible for establishing capital management procedures for
        implementing and monitoring the capital plan. The Board of Directors
        reviews and approves all capital transactions undertaken by
        management.

    11. Stock Based Compensation

        No options were granted under the Company's stock option plan during
        the first three quarters of 2009 (110,000 options were granted during
        the first quarter of 2008, 3,115,000 options were granted during the
        second quarter of 2008, and 933,270 options were granted during the
        third quarter of 2008). The weighted average fair value of options
        granted was $3.11 per option during the nine months ended September
        30, 2008. Compensation expense of $6 after-tax has been recognized in
        the Summaries of Consolidated Operations for the nine months ended
        September 30, 2009 ($8 after-tax for the nine months ended September
        30, 2008).

    12. Pension Plans and Other Post-Retirement Benefits

        The total benefit costs included in operating expenses are as
        follows:

                                   For the three months  For the nine months
                                    ended September 30,   ended September 30,
                                  -------------------------------------------
                                     2009       2008       2009       2008
                                  -------------------------------------------

        Pension benefits          $      15  $       9  $      51  $      43
        Other benefits                    3          4          9         11
                                  -------------------------------------------
        Total                     $      18  $      13  $      60  $      54
                                  -------------------------------------------
                                  -------------------------------------------

    13. Earnings per Common Share

        The following table provides the reconciliation between basic and
        diluted earnings per common share:

                             For the three months      For the nine months
                              ended September 30,       ended September 30,
                          ---------------------------------------------------
                              2009         2008         2009         2008
                          ---------------------------------------------------
        Earnings
        Net income from
         continuing
         operations         $     462    $     450    $   1,236    $   1,653
        Net income from
         discontinued
         operations                 -            -            -          692
                          ---------------------------------------------------
        Net income          $     462    $     450    $   1,236    $   2,345
        Perpetual preferred
         share dividends           17           14           52           42
                          ---------------------------------------------------
        Net income - common
         shareholders       $     445    $     436    $   1,184    $   2,303
                          ---------------------------------------------------
                          ---------------------------------------------------

        Number of common
         shares
        Average number of
         common shares
         outstanding      944,465,294  894,580,690  944,194,267  894,243,179
        Add:
          - Potential
            exercise of
            outstanding
            stock options   2,157,507    3,981,236    1,423,061    4,349,332
                          ---------------------------------------------------
        Average number
         of common shares
         outstanding
         - diluted basis  946,622,801  898,561,926  945,617,328  898,592,511
                          ---------------------------------------------------
                          ---------------------------------------------------

        Basic earnings per
         common share
          From continuing
           operations       $   0.471    $   0.487    $   1.254    $   1.801
          From discontinued
           operations               -            -            -        0.774
                          ---------------------------------------------------
                            $   0.471    $   0.487    $   1.254    $   2.575
                          ---------------------------------------------------
                          ---------------------------------------------------

        Diluted earnings
         per common share
          From continuing
           operations       $   0.470    $   0.485    $   1.253    $   1.793
          From discontinuing
           operations               -            -            -        0.770
                          ---------------------------------------------------
                            $   0.470    $   0.485    $   1.253    $   2.563
                          ---------------------------------------------------
                          ---------------------------------------------------

    14. Accumulated Other Comprehensive Loss

                         For the nine months ended September 30, 2009
                -------------------------------------------------------------
                Unrealized
                   foreign   Unreal-
                  exchange      ized   Unreal-
                     gains     gains      ized
                   (losses)  (losses)    gains
                 on trans-        on   (losses)               Non-
                 lation of available   on cash              contr-
                   foreign  for sale      flow              olling    Share-
                operations    assets    hedges     Total  interest    holder
                -------------------------------------------------------------

    Balance,
     beginning
     of year      $   (605) $    (36) $   (197) $   (838) $     51  $   (787)

    Other
     comprehensive
     loss             (896)      108       183      (605)       12      (593)
    Income tax          (1)      (42)      (64)     (107)        5      (102)
                -------------------------------------------------------------
                      (897)       66       119      (712)       17      (695)
                -------------------------------------------------------------

    Balance, end
     of period    $ (1,502) $     30  $    (78) $ (1,550) $     68  $ (1,482)
                -------------------------------------------------------------
                -------------------------------------------------------------


                         For the nine months ended September 30, 2008
                -------------------------------------------------------------
                Unrealized
                   foreign   Unreal-
                  exchange      ized   Unreal-
                     gains     gains      ized
                   (losses)  (losses)    gains
                 on trans-        on   (losses)               Non-
                 lation of available   on cash              contr-
                   foreign  for sale      flow              olling    Share-
                operations    assets    hedges     Total  interest    holder
                -------------------------------------------------------------

    Balance,
     beginning
     of year      $ (1,801) $    174  $     13  $ (1,614) $     81  $ (1,533)

    Other
     comprehensive
     loss              326      (322)     (112)     (108)        2      (106)
    Income tax           -        93        40       133        (3)      130
                -------------------------------------------------------------
                       326      (229)      (72)       25        (1)       24
                -------------------------------------------------------------

    Balance, end
     of period    $ (1,475) $    (55) $    (59) $ (1,589) $     80  $ (1,509)
                -------------------------------------------------------------
                -------------------------------------------------------------

    15. Contingent Liabilities (changes since December 31, 2008 annual
        report)

        A subsidiary of the Company has concluded an arbitration relating to
        the interpretation of certain provisions of a reinsurance treaty. The
        results of the arbitration award fall within the amount of the
        established actuarial provision.

        The trial of the class proceedings in Ontario regarding the
        participation of the London Life Insurance Company and The Great-West
        Life Assurance Company (Great-West Life) participating accounts in
        the financing of the acquisition of London Insurance Group Inc. in
        1997 by Great-West Life has commenced.

    16. Segmented Information

        Consolidated Operations
        For the three months ended September 30, 2009

                                     United                Lifeco
                          Canada     States     Europe  Corporate      Total
                       ------------------------------------------------------
        Income:
          Premium
           income      $   2,243  $     724  $   1,369  $       -  $   4,336
          Net
           investment
           income
            Regular net
             investment
             income          689        390        501         11      1,591
            Changes in
             fair value
             on held for
             trading
             assets        1,012        671      2,051          -      3,734
                       ------------------------------------------------------
          Total net
           investment
           income          1,701      1,061      2,552         11      5,325
          Fee and other
           income            238        308        182          -        728
                       ------------------------------------------------------
        Total income       4,182      2,093      4,103         11     10,389
                       ------------------------------------------------------
        Benefits and
         expenses:
          Paid or
           credited to
           policyholders   3,353      1,618      3,716          -      8,687
          Other              559        381        174          3      1,117
          Amortization
           of finite life
           intangible
           assets              9         11          1          -         21
                       ------------------------------------------------------
        Net income from
         continuing
         operations
         before income
         taxes               261         83        212          8        564

        Income taxes          39         15         38          6         98
                       ------------------------------------------------------
        Net income before
         non-controlling
         interests           222         68        174          2        466

        Non-controlling
         interests             -          -          4          -          4
                       ------------------------------------------------------
        Net income from
         continuing
         operations          222         68        170          2        462
        Net income from
         discontinued
         operations            -          -          -          -          -
                       ------------------------------------------------------
        Net Income           222         68        170          2        462

        Perpetual
         preferred share
         dividends            10          -          3          4         17
                       ------------------------------------------------------
        Net income
         - common
         shareholders  $     212  $      68  $     167  $      (2) $     445
                       ------------------------------------------------------
                       ------------------------------------------------------


        For the three months ended September 30, 2008

                                     United                Lifeco
                          Canada     States     Europe  Corporate      Total
                       ------------------------------------------------------
        Income:
          Premium
           income      $   1,949  $     479  $   1,484  $       -  $   3,912
          Net
           investment
           income
            Regular net
             investment
             income          609        331        597          2      1,539
            Changes in
             fair value
             on held for
             trading
             assets       (1,392)      (398)      (468)         -     (2,258)
                       ------------------------------------------------------
          Total net
           investment
           income           (783)       (67)       129          2       (719)
          Fee and other
           income            262        353        163          -        778
                       ------------------------------------------------------
        Total income       1,428        765      1,776          2      3,971
                       ------------------------------------------------------
        Benefits and
         expenses:
          Paid or
           credited to
           policyholders     436        343      1,397          -      2,176
          Other              529        385        214          1      1,129
          Amortization
           of finite life
           intangible
           assets              8         11          1          -         20
                       ------------------------------------------------------
        Net income from
         continuing
         operations
         before income
         taxes               455         26        164          1        646

        Income taxes         187        (17)        15         (1)       184
                       ------------------------------------------------------
        Net income before
         non-controlling
         interests           268         43        149          2        462

        Non-controlling
         interests             6          -          6          -         12
                       ------------------------------------------------------
        Net income from
         continuing
         operations          262         43        143          2        450
        Net income from
         discontinued
         operations            -          -          -          -          -
                       ------------------------------------------------------
        Net Income           262         43        143          2        450

        Perpetual
         preferred share
         dividends            11          -          3          -         14
                       ------------------------------------------------------
        Net income
         - common
         shareholders  $     251  $      43  $     140  $       2  $     436
                       ------------------------------------------------------
                       ------------------------------------------------------


        For the nine months ended September 30, 2009

                                     United                Lifeco
                          Canada     States     Europe  Corporate      Total
                       ------------------------------------------------------
        Income:
          Premium
           income      $   6,560  $   2,288  $   4,861  $       -  $  13,709
          Net
           investment
           income
            Regular net
             investment
             income        1,977      1,189      1,534         18      4,718
            Changes in
             fair value
             on held for
             trading
             assets        1,495        996      1,548          -      4,039
                       ------------------------------------------------------
          Total net
           investment
           income          3,472      2,185      3,082         18      8,757
          Fee and other
           income            689        882        503          -      2,074
                       ------------------------------------------------------
        Total income      10,721      5,355      8,446         18     24,540
                       ------------------------------------------------------
        Benefits and
         expenses:
          Paid or
           credited to
           policyholders   8,121      3,925      7,480          -     19,526
          Other            1,675      1,137        550         10      3,372
          Amortization
           of finite life
           intangible
           assets             24         40          4          -         68
                       ------------------------------------------------------
        Net income from
         continuing
         operations
         before income
         taxes               901        253        412          8      1,574

        Income taxes         202         55         35          6        298
                       ------------------------------------------------------
        Net income before
         non-controlling
         interests           699        198        377          2      1,276

        Non-controlling
         interests            31          6          3          -         40
                       ------------------------------------------------------
        Net income from
         continuing
         operations          668        192        374          2      1,236
        Net income from
         discontinued
         operations            -          -          -          -          -
                       ------------------------------------------------------
        Net Income           668        192        374          2      1,236

        Perpetual
         preferred share
         dividends            31          -         10         11         52
                       ------------------------------------------------------
        Net income
         - common
         shareholders  $     637  $     192  $     364  $      (9) $   1,184
                       ------------------------------------------------------
                       ------------------------------------------------------


        For the nine months ended September 30, 2008

                                     United                Lifeco
                          Canada     States     Europe  Corporate      Total
                       ------------------------------------------------------
        Income:
          Premium
           income      $   5,998  $   1,805  $  17,422  $       -  $  25,225
          Net
           investment
           income
            Regular net
             investment
             income        1,873        977      1,692         (3)     4,539
            Changes in
             fair value
             on held for
             trading
             assets       (1,560)    (1,005)    (2,228)         -     (4,793)
                       ------------------------------------------------------
          Total net
           investment
           income            313        (28)      (536)        (3)      (254)
          Fee and other
           income            804      1,107        470          -      2,381
                       ------------------------------------------------------
          Total income     7,115      2,884     17,356         (3)    27,352
                       ------------------------------------------------------
        Benefits and
         expenses:
          Paid or
           credited to
           policyholders   4,238      1,533     16,191          -     21,962
          Other            1,647      1,131        542          9      3,329
          Amortization
           of finite life
           intangible
           assets             22         38          3          -         63
                       ------------------------------------------------------
        Net income from
         continuing
         operations
         before income
         taxes             1,208        182        620        (12)     1,998

        Income taxes         351         12        101         (1)       463
                       ------------------------------------------------------
        Net income before
         non-controlling
         interests           857        170        519        (11)     1,535

        Non-controlling
         interests            50       (175)         7          -       (118)
                       ------------------------------------------------------
        Net income from
         continuing
         operations          807        345        512        (11)     1,653
        Net income from
         discontinued
         operations            -        692          -          -        692
                       ------------------------------------------------------
        Net Income           807      1,037        512        (11)     2,345

        Perpetual
         preferred share
         dividends            32          -         10          -         42
                       ------------------------------------------------------
        Net income
         - common
         shareholders  $     775  $   1,037  $     502  $     (11) $   2,303
                       ------------------------------------------------------
                       ------------------------------------------------------

    17. Subsequent Events

        (a) On October 2, 2009 the Company issued 6,800,000 Series L, 5.65%
            Non-Cumulative First Preferred Shares at $25 per share. The
            shares are redeemable at the option of the Company on and after
            December 31, 2014 for $25 per share plus a premium if redeemed
            prior to December 31, 2018, in each case with all declared and
            unpaid dividends to but excluding the date of redemption.

        (b) The Company has entered into an agreement to settle a class
            action relating to the provision of notice of the acquisition of
            Canada Life Financial Corporation to certain shareholders of
            Canada Life Financial Corporation. The agreement requires
            approval of the Court before it is final. Based on information
            presently known, this matter is not expected to have a material
            adverse effect on the consolidated financial position of the
            Company.

        (c) On November 3, 2009, the Royal Bank of Scotland Group PLC (RBS)
            and Lloyds Banking Group (Lloyds) announced capital and
            restructuring plans which contemplate the deferral of coupons and
            extensions of anticipated redemption dates on some capital
            securities. The Company believes that some, but not all, of its
            investment holdings in these issuers may be affected by these
            plans. The instruments most likely to be impacted are the Upper
            Tier 2 and Tier 1 Capital Securities. As at September 30, 2009,
            the Company held the following Upper Tier 2 and Tier 1 Capital
            Securities of these companies.

                                                        Amortized    Market
                                                           Cost      Value
                                                   --------------------------
        Royal Bank of Scotland                       $     473*  $     294
        Lloyds Banking Group                         $     567*  $     374

        The Company currently holds provisions of $306 against these
        securities.

        * These are all cumulative instruments, except for $96 of holdings
            in Lloyds which are non cumulative.

        There is uncertainty regarding the impact on these securities of the
        announcements. Therefore management is not yet able to determine the
        impact, if any, on the Company.
    

SOURCE Great-West Lifeco Inc.

For further information: For further information: Marlene Klassen, APR, Assistant Vice-President, Communication Services, (204) 946-7705


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890