Manulife Financial Corporation reports record second quarter earnings of $1.1 billion



    Adjusted return on shareholders' equity of 18.5 per cent, up 220 basis
    points

     - TSX/NYSE/PSE: MFC; SEHK: 0945

    TORONTO, Aug. 8 /CNW/ - Manulife Financial Corporation today reported
record shareholders' net income of $1,102 million, an increase of 15 per cent
over the second quarter of last year. Fully diluted earnings per share were
$0.71, up 18 per cent from one year ago. As well, adjusted return on common
shareholders' equity(1) was 18.5 per cent, an increase of 220 basis points.
    Second quarter premiums and deposits rose to $16 billion, an increase of
five per cent over last year when considered on a constant currency basis.
Growth was a result of continued strong sales and growth in recurring premiums
and deposits.
    "The second quarter was a solid one for our Company," said Dominic
D'Alessandro, President and Chief Executive Officer of Manulife Financial.
"Our businesses continued to deliver strong earnings and sales growth and our
return on equity hit a post-merger record. The strengths of our diversified
platform are again evident in these results."
    Record sales levels were achieved in a number of businesses this quarter:

    -   John Hancock Variable Annuities sales of US$2.8 billion, up 14 per
        cent
    -   John Hancock Long Term Care sales of US$58 million, up 61 per cent
    -   Canadian Individual Life Insurance sales of $57 million, up 36 per
        cent
    -   Other Asia Territories Individual Life sales of US$44 million, up
        42 per cent

    "We continued to see strong in-force earnings growth across our key
operating businesses," noted Peter Rubenovitch, Senior Executive Vice
President and Chief Financial Officer. "As well, the positive impact of equity
markets and higher interest rates contributed favourably to this quarter's
record result."
    Total funds under management increased by 11 per cent, or $41 billion,
over last year to $410 billion as at June 30, 2007. Excluding scheduled
maturities of John Hancock Fixed institutional products and the negative
impact of currency movements, total funds under management grew by 16 per
cent.
    -----------------
    (1) Adjusted return on common shareholders' equity excludes Accumulated
        Other Comprehensive Income on available-for-sale securities and cash
        flow hedges.

    OPERATING HIGHLIGHTS

    United States

    -   Sales of John Hancock Variable Annuities rose to US$2.8 billion in
        the second quarter, an increase of 30 per cent above the prior
        quarter and 14 per cent above the previous record set in the second
        quarter of last year. A number of new initiatives contributed to the
        strong sales including the following key items:

        -  The May launch of 'Income Plus For Life,' a new optional living
           benefit product that provides for lifetime income beginning at age
           59 1/2 and additional rewards for clients who defer withdrawals
           and take income later.

        -  Enhancements to the business' investment platform underlying the
           variable annuity products to include new asset allocation options
           from leading investment managers American Funds and Franklin
           Templeton.

    -   In John Hancock Retirement Plan Services, funds under management
        exceeded the US$50 billion mark for the first time ever, increasing
        32 per cent over the prior year to US$52 billion as at June 30, 2007.
        New sales, recurring premiums and deposits and favourable equity
        markets contributed to the strong growth.

    -   John Hancock Life experienced record sales in the month of June, the
        highest monthly sales outside of its peak year-end sales month of
        December, leading the business to record second quarter sales of
        US$201 million. Sales success has been bolstered by a continued focus
        on product development and innovation, including the second quarter
        launch of two new products; Performance UL, a low-cost universal life
        product and Protection SUL-G, a fully guaranteed survivorship
        universal life product.

    -   John Hancock Long Term Care reported record quarterly sales of
        US$58 million, up 61 per cent over last year. Significant success in
        the large case group market was a key contributor to sales growth.
        The business also launched an enhanced version of its Corporate
        Solutions program through its retail distribution channels, designed
        to expand its presence into the small and mid-sized group market.

    Canada

    -   Individual Insurance reported record quarterly earnings and record
        Individual Life sales of $57 million. Sales growth was driven by
        improvements in new business cycle time and product enhancements,
        particularly in universal life, introduced over the past several
        quarters.

    -   Group Benefits launched its first Critical Illness product, designed
        to supplement coverage available to plan members through their
        employer's group health, life and disability plans.

    -   Manulife and Berkshire-TWC Financial Group Inc. ("Berkshire")
        announced that Manulife will acquire Berkshire and its more than
        700 advisors and 237 branches across Canada. When combined with our
        existing mutual fund dealer, Manulife Securities, the transaction
        will double the number of wealth management advisors across Canada
        and will triple assets under administration in that business to
        approximately $19 billion.

    Asia and Japan

    -   Manulife Japan launched an innovative new variable annuity product
        through Bank of Tokyo-Mitsubishi UFJ, Ltd. The new product is
        designed to be consumer friendly and easily understood and enables
        customers to lock-in and ensure investment gains. Sales of the
        product commenced on June 25, 2007.

    -   In Singapore, Manulife launched the country's first variable annuity
        product. Manulife 'Secure Retirement Plus' offers a guaranteed
        withdrawal benefit that provides a regular stream of retirement
        income for at least 20 years or income for life from age 65. The
        product is being sold through Citibank branches and through Manulife
        Financial Planners and Financial Advisor Firms.

    -   In Thailand, Manulife established a new asset management company. The
        new company offers Thai-registered, Thai-baht denominated domestic
        and foreign investment funds to institutional and retail investors.

    -   Manulife Financial continued to expand its operations in China and in
        the second quarter received approval to open a sales office in
        Zhenjiang, Jiangsu Province. As well, a new license received for the
        city of Nanchong, Sichuan province, early in the third quarter brings
        the total number of licensed cities up to 21, the most of any foreign
        joint venture operating in China.

    Corporate

    -   Manulife Financial repurchased 21.9 million shares in the second
        quarter, at a total cost of approximately $867 million.

    -   The Company also announced today that the Board of Directors approved
        a quarterly shareholders' dividend of $0.22 per share on the common
        shares of the Company, payable on and after September 19, 2007 to
        shareholders of record at the close of business on August 20, 2007.

    Awards

    -   Manulife Financial received a number of awards in the quarter
        including the following:

        -  The Manulife Funds' Core Canadian Equity Fund placed first at the
           Lipper Fund Awards 2007 in the Canadian Equity (Pure) Fund
           category, in recognition of the fund's consistently strong risk-
           adjusted performance relative to its peers.

        -  John Hancock Annuities won "Best in Show" for its Variable Annuity
           sales kit, in the category of Producer/Agent Marketing Sales
           Promotion, at the 2007 Insurance Marketing Communications
           Association showcase competition.

        -  John Hancock Funds was awarded "Best Creative Team" honors at the
           American Business Awards 5th Annual Stevie Awards.

        -  John Hancock Retirement Plan Services rated as the best-in-class
           provider in more than 70 per cent of the categories in Chatham's
           benchmark universe.

        -  In Hong Kong, Manulife won the Trusted Brands Gold Award for the
           insurance company category organized by Reader's Digest, for the
           4th consecutive year.

    
    MANAGEMENT'S DISCUSSION AND ANALYSIS

    Financial Highlights
    (unaudited)

                                                  Quarterly Results
                                                  2Q07       1Q07       2Q06
                                               ------------------------------
    Shareholders' Net Income (C$ millions)       1,102        986        959
    Premiums & Deposits (C$ millions)           16,438     18,789     15,877
    Funds under Management (C$ billions)         410.2      426.3      369.6
    Capital (C$ billions)                         30.5       32.4       28.3

    Effective January 1, 2007, the Company adopted four new Canadian
accounting standards for Financial Instruments - Recognition and Measurement,
Hedges, Comprehensive Income and Accounting for Leveraged Leases. These
changes in accounting policies have not had a material impact on shareholders'
net income.

    Net Income
    ----------
    The Company's shareholders' net income for the second quarter of 2007 was
$1,102 million, up 15 per cent from $959 million reported a year earlier. The
increase in earnings was a result of strong in-force earnings; the positive
impact of rising equity markets on owned equities, segregated fund guarantees,
and fee income; and favourable investment returns including the impact of
interest rate movements. The increases were partially offset by the non-
recurrence of certain items recorded in 2006. Year-to-date shareholders' net
income was $2,088 million compared to $1,911 million in 2006.

    Diluted Earnings per Share and Adjusted Return on Common Shareholders'
    ----------------------------------------------------------------------
    Equity
    ------
    Second quarter reported diluted earnings per common share of $0.71 grew
by 18 per cent from $0.60 in 2006 and return on shareholders' equity for the
three months ended June 30, 2007 was 17.2 per cent.
    Management measures return on common shareholders' equity excluding the
components of Accumulated Other Comprehensive Income on available-for-sale
securities and cash flow hedges, as it is more comparable to prior periods and
more appropriately reflects achieved returns. Adjusted return on common
shareholders' equity was 18.5 per cent for the three months ended June 30,
2007, an increase of 220 basis points over 16.3 per cent for the three months
ended June 30, 2006.

    Premiums and Deposits
    ---------------------
    Premiums and deposits for the quarter were $16.4 billion, up four per
cent from $15.9 billion reported a year earlier. This increase reflects strong
business growth and higher segregated funds deposits, partially offset by the
$0.3 billion negative impact of the strengthened Canadian dollar.

    Funds under Management
    ----------------------
    Funds under management grew by 11 per cent, or $40.6 billion, to
$410.2 billion as at June 30, 2007. The increase is primarily driven by strong
net policyholder cash flows and favourable equity market performance over the
past twelve months. The recording of our securities at fair value in
accordance with the new financial instruments accounting standards resulted in
an increase of $4.4 billion at January 1, 2007. Offsetting these increases
were the $16.7 billion negative impact of a strengthened Canadian dollar and
$2.9 billion of scheduled maturities of John Hancock Fixed institutional
products.

    Capital
    -------
    Total capital was $30.5 billion as at June 30, 2007, up $2.2 billion from
$28.3 billion as at June 30, 2006. The increase of $1,565 million in
shareholders' equity due to the change in accounting standards for financial
instruments, net new debt capital issued of $611 million and net income in the
past twelve months of $4,162 million were partially offset by shareholders'
dividends of $1,257 million, the repurchase of 44 million common shares for
$1,712 million and charges of $1,105 million to Accumulated Other
Comprehensive Income primarily due to the $1.1 billion negative impact of the
strengthened Canadian dollar over the last twelve months.

    PERFORMANCE BY DIVISION

    U.S. Insurance

                                                  Quarterly Results
    Canadian dollars                              2Q07       1Q07       2Q06
                                               ------------------------------
    Shareholders' Net Income (millions)            179        142        127
    Premiums & Deposits (millions)               1,585      1,652      1,579
    Funds under Management (billions)             58.4       62.5       56.3

                                                  Quarterly Results
    U.S. dollars                                  2Q07       1Q07       2Q06
                                               ------------------------------
    Shareholders' Net Income (millions)            163        121        113
    Premiums & Deposits (millions)               1,444      1,410      1,410
    Funds under Management (billions)             54.9       54.2       50.5

    U.S. Insurance shareholders' net income for the second quarter of 2007
was $179 million, up $52 million from $127 million reported a year earlier.
The increase in earnings was a result of higher investment related gains
arising from strong equity markets, growth in private equity investments and
the increase in interest rates, partially offset by less favourable claims
experience. Year-to-date shareholders' net income was $321 million compared to
$285 million in 2006.
    Premiums and deposits for the quarter of $1.6 billion were unchanged from
the second quarter of 2006. On a U.S. dollar basis, premiums and deposits have
increased by two per cent due to higher sales and in-force business growth in
John Hancock Long Term Care.
    Funds under management grew by four per cent, or $2.1 billion, to
$58.4 billion as at June 30, 2007. On a U.S. dollar basis, funds under
management grew by nine per cent due to business growth and the impact of
favourable equity market performance over the last twelve months.

    U.S. Wealth Management

                                                  Quarterly Results
    Canadian dollars                              2Q07       1Q07       2Q06
                                               ------------------------------
    Shareholders' Net Income (millions)            234        335        301
    Premiums & Deposits (millions)               8,839      9,646      8,585
    Funds under Management (billions)            190.5      197.9      173.1

                                                  Quarterly Results
    U.S. dollars                                  2Q07       1Q07       2Q06
                                               ------------------------------
    Shareholders' Net Income (millions)            213        285        268
    Premiums & Deposits (millions)               8,054      8,232      7,654
    Funds under Management (billions)            179.1      171.6      155.3

    U.S. Wealth Management shareholders' net income for the second quarter of
2007 was $234 million, down $67 million from $301 million reported a year
earlier. Earnings increased as a result of growth in fee income in JH Variable
Annuities (VA) and JH Retirement Plan Services (RPS) as well as the favourable
impact of equity markets on segregated fund guarantee reserves and the
updating of acquisition cost amortization schedules in VA. These increases in
earnings were more than offset by a decline in JH Fixed earnings driven by the
non-recurrence of the favourable investment results reported in 2006. Year-to-
date shareholders' net income was $569 million, compared to $556 million in
2006.
    Premiums and deposits for the quarter were $8.8 billion, up three per
cent from $8.6 billion reported in the second quarter of 2006. Premiums and
deposits were up $0.5 billion due to higher new sales and recurring deposits
from the growing block of in-force participants in RPS as well as an increase
in VA premiums and deposits with the successful launch of the Income Plus For
Life rider during the quarter. These increases were partially offset by lower
fixed deferred annuity sales.
    Funds under management grew by 10 per cent, or $17.4 billion, to
$190.5 billion as at June 30, 2007. Funds under management increased in the
VA, RPS and JH Mutual Funds businesses as a result of strong net policyholder
cash flows plus the cumulative effect of favourable equity market performance
over the last twelve months. These increases were partially offset by
scheduled maturities exceeding new sales over the last twelve months in the JH
Fixed business.

    Canadian Division

                                                  Quarterly Results
    Canadian dollars                              2Q07       1Q07       2Q06
                                               ------------------------------
    Shareholders' Net Income (millions)            296        218        267
    Premiums & Deposits (millions)               3,569      4,893      3,268
    Funds under Management (billions)             82.6       81.4       71.4

    Canadian Division's shareholders' net income for the second quarter of
2007 was $296 million, up $29 million from $267 million reported a year
earlier. The prior year's earnings include a $42 million gain related to the
reduction in federal tax rates. Excluding this gain, earnings increased due to
strong business growth, particularly in the wealth management businesses, the
positive impact of rising equity markets on segregated fund guarantees and fee
income, as well as favourable investment returns. Year-to-date shareholders'
net income was $514 million compared to $505 million in 2006.
    Premiums and deposits for the quarter were $3.6 billion, up nine per cent
from $3.3 billion reported in the second quarter of 2006 driven by the rise in
segregated fund deposits. This growth reflects the impact of the new
IncomePlus guaranteed minimum withdrawal benefit product in Individual Wealth
Management and new sales and recurring deposits from a growing block of in-
force participants in Group Savings and Retirement Solutions.
    Funds under management grew by 16 per cent, or $11.2 billion, to
$82.6 billion as at June 30, 2007. The growth in funds under management was
driven by net sales of segregated funds in our wealth management businesses
and the favourable impact of strong equity market appreciation over the past
twelve months.

    Asia and Japan Division

                                                  Quarterly Results
    Canadian dollars                              2Q07       1Q07       2Q06
                                               ------------------------------
    Shareholders' Net Income (millions)            242        214        199
    Premiums & Deposits (millions)               2,182      2,291      2,211
    Funds under Management (billions)             39.2       40.3       32.6

                                                  Quarterly Results
    U.S. dollars                                  2Q07       1Q07       2Q06
                                               ------------------------------
    Shareholders' Net Income (millions)            220        183        178
    Premiums & Deposits (millions)               1,989      1,955      1,972
    Funds under Management (billions)             36.9       34.9       29.2

    Asia and Japan Division's shareholders' net income for the second quarter
of 2007 was $242 million, up $43 million from $199 million reported a year
earlier. The strong increase in earnings was driven by the positive impact of
rising equity markets on fee income across the wealth management businesses
and on investment income in Hong Kong and in the Other Asia Territories. New
product launches and the repricing of medical riders in Taiwan also
contributed to the increase. Last year's results included gains recognized on
changes to Japan's investment portfolio which did not recur in 2007. Year-to-
date shareholders' net income was $456 million compared to $361 million in
2006.
    Premiums and deposits for the quarter were $2.2 billion, consistent with
the prior year. A continued recovery in mutual fund sales in Indonesia, sales
of our investment linked products in Singapore, and growth in Hong Kong's
pension business were offset by lower variable annuity sales in Japan due to
the voluntary discontinuance of a product in 2006. Japan launched a new
investment-type annuity insurance product in June 2007, complementing the new
variable annuity product launched at the end of 2006.
    Funds under management grew by 20 per cent, or $6.6 billion, to
$39.2 billion as at June 30, 2007. Growth was fuelled by the positive impact
of rising equity markets; variable annuity sales in Japan over the last twelve
months; increased business volumes in pension and wealth management products
in Hong Kong; and the continued recovery of the mutual fund market in
Indonesia.

    Reinsurance Division

                                                  Quarterly Results
    Canadian dollars                              2Q07       1Q07       2Q06
                                               ------------------------------
    Shareholders' Net Income (millions)             70         69         48
    Premiums (millions)                            262        275        234


                                                  Quarterly Results
    U.S. dollars                                  2Q07       1Q07       2Q06
                                               ------------------------------
    Shareholders' Net Income (millions)             63         59         43
    Premiums (millions)                            238        235        208

    Reinsurance Division's shareholders' net income for the second quarter of
2007 was $70 million, up $22 million from $48 million reported a year earlier.
The increase in earnings was due to improved Life Reinsurance and Property and
Casualty claims experience and favourable investment results. Year-to-date
shareholders' net income was $139 million compared to $140 million reported in
2006.
    Premiums for the quarter were $262 million, up 12 per cent from
$234 million reported in the second quarter of 2006. Growth in Life
Reinsurance and International Group Program premiums were partly offset by
reduced levels of Property and Casualty business.

    Corporate and Other

                                                  Quarterly Results
    Canadian dollars                              2Q07       1Q07       2Q06
                                               ------------------------------
    Shareholders' Net Income (millions)             81          8         17
    Funds under Management (billions)             36.9       41.4       33.5

    Corporate and Other is comprised of the Investment Division's external
asset management business, earnings on excess capital, the transfer of credit
risk from operating divisions, changes in actuarial methods and assumptions
and other non-operating events. Also included in Corporate and Other is the
John Hancock Accident and Health operations, which consists primarily of
contracts in dispute. Funds under management include externally managed assets
and assets backing the Company's capital.
    Corporate and Other shareholders' net income for the second quarter of
2007 was $81 million, up $64 million from $17 million reported a year earlier.
The increase is due to improved credit experience, favourable tax benefits
versus a charge last year, and gains realized on private equity holdings.
Partially offsetting these were changes in actuarial methods and assumptions
which resulted in a larger decrease in earnings this quarter ($17 million)
compared to a year ago ($12 million). Year-to-date shareholders' net income
was $89 million compared to $64 million in 2006.
    Funds under management grew by 10 per cent, or $3.4 billion, to
$36.9 billion at June 30, 2007. The increase was due to additional external
assets managed and the impact of equity markets, partially offset by share buy
backs and the negative impact of the strengthened Canadian dollar during the
past twelve months.

    Performance and Non-GAAP Measures
    ---------------------------------
    We use a number of non-GAAP financial measures to measure overall
performance and to assess each of our businesses. Non-GAAP measures include
adjusted return on common shareholders' equity, premiums and deposits, funds
under management and new business embedded value. Non-GAAP financial measures
are not defined terms under GAAP and, therefore, are unlikely to be comparable
to similar terms used by other issuers.

    About Manulife Financial
    ------------------------
    Manulife Financial is a leading Canadian-based financial services group
serving millions of customers in 19 countries and territories worldwide.
Operating as Manulife Financial in Canada and Asia, and primarily through John
Hancock in the United States, the Company offers clients a diverse range of
financial protection products and wealth management services through its
extensive network of employees, agents and distribution partners. Funds under
management by Manulife Financial and its subsidiaries were Cdn$410 billion
(US$386 billion) as at June 30, 2007.
    Manulife Financial Corporation trades as 'MFC' on the TSX, NYSE and PSE,
and under '0945' on the SEHK. Manulife Financial can be found on the Internet
at www.manulife.com.

    Attachments: Financial Highlights, Consolidated Statements of Operations,
Consolidated Balance Sheets, Divisional Information.

    Notes:

    Manulife Financial Corporation will host a Second Quarter Earnings
Results Conference Call at 2:00 p.m. ET August 8, 2007. For local and
international locations, please call (416) 340-2216 and toll free in North
America please call (866) 898-9626. Please call in ten minutes before the call
starts. You will be required to provide your name and organization to the
operator. A playback of this call will be available by 6:00 p.m. ET on
August 8, 2007 until August 15, 2007 by calling (416) 695-5800 (passcode No.
3213641).
    The conference call will also be webcast through Manulife Financial's
website at 2:00 p.m. ET August 8, 2007. You may access the webcast at:
www.manulife.com/QuarterlyReports. An archived version of the webcast will be
available later on the website at the same URL as above.
    The Second Quarter 2007 Financial Statements and Statistical Information
Package are also available on the Manulife website at:
www.manulife.com/QuarterlyReports. Each of these documents may be downloaded
before the webcast begins.

    Caution Regarding Forward-Looking Statements
    --------------------------------------------
    This document contains forward-looking statements within the meaning of
the "safe harbour" provisions of Canadian provincial securities laws and the
U.S. Private Securities Litigation Reform Act of 1995. These forward-looking
statements relate to, among other things, our objectives, goals, strategies,
intentions, plans, beliefs, expectations and estimates, and can generally be
identified by the use of words such as "may", "will", "could", "should",
"would", "suspect", "outlook", "expect", "intend", "estimate", "anticipate",
"believe", "plan", "forecast", "objective"
    and "continue" (or the negative thereof) and words and expressions of
similar import, and include statements concerning possible or assumed future
results. Although we believe that the expectations reflected in such forward-
looking statements are reasonable, such statements involve risks and
uncertainties, and undue reliance should not be placed on such statements.
Certain material factors or assumptions are applied in making forward-looking
statements, and actual results may differ materially from those expressed or
implied in such statements. Important factors that could cause actual results
to differ materially from expectations include but are not limited to: level
of competition and consolidation, changes in laws and regulations, general
business and economic conditions, currency rates and Company liquidity,
accuracy of information received from counterparties and the ability of
counterparties to meet their obligations, accuracy of accounting policies and
actuarial methods used by the Company, ability to maintain the Company's
reputation, legal and regulatory proceedings, the disruption of or changes to
key elements of the Company's or to public infrastructure systems, the ability
to attract and retain key executives, environmental concerns, the ability to
complete acquisitions and execute strategic plans, and the ability to adapt
products and services to the changing market. Additional information about
material factors that could cause actual result to differ materially from
expectations and about material factors or assumptions applied in making
forward-looking statements may be found in the body of this document as well
as under "Risk Factors" in our most recent Annual Information Form, under
"Risk Management" and "Critical Accounting and Actuarial Policies" in the
Management's Discussion and Analysis in our most recent Annual Report, and
elsewhere in our filings with Canadian and U.S. securities regulators. We do
not undertake to update any forward- looking statements.



    Financial Highlights
    (Canadian $ in millions unless otherwise
     stated and per share information, unaudited)

                                                   As at and for the three
                                                     months ended June 30
                                                  2007       2006   % Change
    -------------------------------------------------------------------------

    Net income                               $   1,099  $     948         16
      Loss attributed to participating
       policyholders                                (3)       (11)         -
    -------------------------------------------------------------------------
    Net income attributed to shareholders    $   1,102  $     959         15
      Preferred share dividends                     (7)        (8)         -
    -------------------------------------------------------------------------
    Net income available to common
     shareholders                            $   1,095  $     951         15
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Premiums and deposits:
      Life and health insurance premiums     $   3,694  $   3,593          3
      Annuity and pension premiums               1,138      1,078          6
      Segregated fund deposits                   8,545      7,997          7
      Mutual fund deposits                       2,305      2,409         (4)
      ASO premium equivalents                      584        570          2
      Other fund deposits                          172        230        (25)
    -------------------------------------------------------------------------
    Total premiums and deposits              $  16,438  $  15,877          4
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Funds under management:
      General fund                           $ 163,532  $ 162,215          1
      Segregated funds                         176,648    146,200         21
      Mutual funds                              38,810     35,043         11
      Other funds                               31,240     26,186         19
    -------------------------------------------------------------------------
    Total funds under management             $ 410,230  $ 369,644         11
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Capitalization:
      Long-term debt(*)                      $   2,923  $   2,485         18
      Liabilities for preferred shares and
       capital instruments                       1,990      1,897          5
      Non-controlling interest in
       subsidiaries                                202        204         (1)

    Equity
      Participating policyholders' equity          153        140          9
      Shareholders' equity
        Preferred shares                           638        638          -
        Common shares                           14,043     14,294         (2)
        Contributed surplus                        130         92         41
        Retained earnings                       13,632     12,363         10
        Accumulated other comprehensive loss    (3,185)    (3,821)       (17)
    -------------------------------------------------------------------------
    Total capital                            $  30,526  $  28,292          8
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    (*) Includes $545 operational leverage

    Selected key performance measures:
      Basic earnings per common share        $   $0.72  $   $0.61
      Diluted earnings per common share      $   $0.71  $   $0.60
      Return on common shareholders' equity
       (annualized)                              17.2%      16.3%
      Adjusted return on common shareholders'
       equity (annualized)                       18.5%      16.3%
      Book value per common share            $   16.21  $   14.74
      Common shares outstanding (in millions)
        End of period                            1,519      1,556
        Weighted average - basic                 1,532      1,570
        Weighted average - diluted               1,546      1,586



    Summary Consolidated Financial Statements

    Consolidated Statements of Operations
    (Canadian $ in millions except per share
     data, unaudited)                                         For the three
                                                               months ended
                                                                 June 30
                                                             2007       2006
    -------------------------------------------------------------------------
    Revenue
    Premium income                                      $   4,832  $   4,671
    Investment income
      Investment income                                     2,408      2,444
      Realized/ unrealized losses on invested assets
       supporting policy liabilities and consumer notes    (1,308)       (76)
    Other revenue                                           1,356      1,150
    -------------------------------------------------------------------------
    Total revenue                                       $   7,288  $   8,189
    -------------------------------------------------------------------------
    Policy benefits and expenses
    To policyholders and beneficiaries
      Death, disability and other claims                $   1,569  $   1,576
      Maturity and surrender benefits                       1,857      2,235
      Annuity payments                                        727        810
      Policyholder dividends and experience rating
       refunds                                                391        380
      Net transfers to segregated funds                       158        117
      Change in actuarial liabilities(1)                   (1,154)      (398)
    General expenses                                          833        813
    Investment expenses                                       257        206
    Commissions                                               944        874
    Interest expense                                          191        229
    Premium taxes                                              66         70
    Non-controlling interest in subsidiaries                    9          6
    -------------------------------------------------------------------------
    Total policy benefits and expenses                  $   5,848  $   6,918
    -------------------------------------------------------------------------
    Income before income taxes                          $   1,440  $   1,271
    Income taxes                                             (341)      (323)
    -------------------------------------------------------------------------
    Net income                                          $   1,099  $     948
      Loss attributed to participating policyholders           (3)       (11)
    -------------------------------------------------------------------------
    Net income attributed to shareholders               $   1,102  $     959
      Preferred share dividends                                (7)        (8)
    -------------------------------------------------------------------------
    Net income available to common shareholders         $   1,095  $     951
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Basic earnings per common share                     $    0.72  $    0.61
    Diluted earnings per common share                   $    0.71  $    0.60

    (1) Includes impact of net redemptions in John Hancock Fixed
        institutional products of $0.2 billion in Q2 2007 and $1.0 billion in
        Q2 2006.



    Consolidated Balance Sheets
    (Canadian $ in millions, unaudited)
                                                              As at June 30
    Assets                                                   2007       2006
    -------------------------------------------------------------------------
    Invested assets
    Cash and short-term securities                      $  10,368  $   7,715
    Securities
      Bonds                                                74,453     77,331
      Stocks                                               11,930      9,922
    Loans
      Mortgages                                            26,350     27,239
      Private placements                                   22,937     23,253
      Policy loans                                          6,052      6,015
      Bank loans                                            2,106      1,983
    Real estate                                             5,826      5,239
    Other investments                                       3,510      3,518
    -------------------------------------------------------------------------
    Total invested assets                               $ 163,532  $ 162,215
    -------------------------------------------------------------------------
    Other assets
    Accrued investment income                           $   1,488  $   1,554
    Outstanding premiums                                      670        619
    Goodwill                                                6,977      7,255
    Intangible assets                                       1,561      1,651
    Derivatives                                             2,696        233
    Miscellaneous                                           3,013      3,484
    -------------------------------------------------------------------------
    Total other assets                                  $  16,405  $  14,796
    -------------------------------------------------------------------------
    Total assets                                        $ 179,937  $ 177,011
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Segregated funds net assets                         $ 177,509  $ 146,904
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities and equity
    -------------------------------------------------------------------------
    Policy liabilities                                  $ 128,368  $ 126,753
    Deferred realized net gains                               115      4,241
    Bank deposits                                           8,107      6,886
    Consumer notes                                          2,382      2,772
    Future income tax liability                             2,611      1,922
    Derivatives                                             2,575        429
    Other liabilities                                       5,253      5,716
    -------------------------------------------------------------------------
                                                        $ 149,411  $ 148,719
    Long-term debt                                          2,923      2,485
    Liabilities for preferred shares and capital
     instruments                                            1,990      1,897
    Non-controlling interest in subsidiaries                  202        204

    Equity
      Participating policyholders' equity                     153        140
      Shareholders' equity
        Preferred shares                                      638        638
        Common shares                                      14,043     14,294
        Contributed surplus                                   130         92
        Retained earnings                                  13,632     12,363
        Accumulated other comprehensive loss               (3,185)    (3,821)
    -------------------------------------------------------------------------
      Total equity                                      $  25,411  $  23,706
    -------------------------------------------------------------------------
    Total liabilities and equity                        $ 179,937  $ 177,011
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Segregated funds net liabilities                    $ 177,509  $ 146,904
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    Notes to Summary Consolidated Financial Statements
    (Canadian $ in millions, unaudited)

    Note 1: Divisional Information

                                      For the quarter ended June 30, 2007
                                  -------------------------------------------
                                                U.S.
                                     U.S.      Wealth                 Asia
    Premiums and deposits         Insurance  Management  Canadian  and Japan
    -------------------------------------------------------------------------
    General fund premiums         $   1,300  $     987  $   1,556  $     727
    Segregated fund deposits            285      5,741      1,299      1,219
    Mutual fund deposits                  -      1,939        130        236
    ASO premium equivalents               -          -        584          -
    Other fund deposits                   -        172          -          -
    -------------------------------------------------------------------------
    Total                         $   1,585  $   8,839  $   3,569  $   2,182
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Net income                    $     179  $     234  $     293  $     242
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Funds under management                     As at June 30, 2007
    -------------------------------------------------------------------------
    General fund                  $  46,209  $  39,378  $  48,476  $  16,372
    Segregated funds                 12,171    113,526     30,692     17,894
    Mutual funds                          -     33,608      3,451      1,751
    Other funds                           -      3,993          -      3,224
    -------------------------------------------------------------------------
    Total                         $  58,380  $ 190,505  $  82,619  $  39,241
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


                                             Corporate
                                                and
    Premiums and deposits         Reinsurance  Other      Total
    --------------------------------------------------------------
    General fund premiums         $     262  $       -  $   4,832
    Segregated fund deposits              -          1      8,545
    Mutual fund deposits                  -          -      2,305
    ASO premium equivalents               -          -        584
    Other fund deposits                   -          -        172
    --------------------------------------------------------------
    Total                         $     262  $       1  $  16,438
    --------------------------------------------------------------
    --------------------------------------------------------------

    Net income                    $      70  $      81  $   1,099
    --------------------------------------------------------------
    --------------------------------------------------------------

    Funds under management               As at June 30, 2007
    --------------------------------------------------------------
    General fund                  $   2,602  $  10,495  $ 163,532
    Segregated funds                      -      2,365    176,648
    Mutual funds                          -          -     38,810
    Other funds                           -     24,023     31,240
    --------------------------------------------------------------
    Total                         $   2,602  $  36,883  $ 410,230
    --------------------------------------------------------------
    --------------------------------------------------------------


                                      For the quarter ended June 30, 2006
                                  -------------------------------------------
                                                U.S.
                                     U.S.      Wealth                 Asia
    Premiums and deposits         Insurance  Management  Canadian  and Japan
    -------------------------------------------------------------------------
    General fund premiums         $   1,302  $     933  $   1,487  $     715
    Segregated fund deposits            277      5,383      1,017      1,320
    Mutual fund deposits                  -      2,039        194        176
    ASO premium equivalents               -          -        570          -
    Other fund deposits                   -        230          -          -
    -------------------------------------------------------------------------
    Total                         $   1,579  $   8,585  $   3,268  $   2,211
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Net income                    $     127  $     301  $     252  $     203
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Funds under management                     As at June 30, 2006
    -------------------------------------------------------------------------
    General fund                  $  45,131  $  45,094  $  43,899  $  14,994
    Segregated funds                 11,129     94,087     24,256     14,357
    Mutual funds                          -     30,559      3,234      1,250
    Other funds                           -      3,368          -      1,973
    -------------------------------------------------------------------------
    Total                         $  56,260  $ 173,108  $  71,389  $  32,574
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

                                             Corporate
                                                and
    Premiums and deposits         Reinsurance  Other      Total
    --------------------------------------------------------------
    General fund premiums         $     234  $       -  $   4,671
    Segregated fund deposits              -          -      7,997
    Mutual fund deposits                  -          -      2,409
    ASO premium equivalents               -          -        570
    Other fund deposits                   -          -        230
    --------------------------------------------------------------
    Total                         $     234  $       -  $  15,877
    --------------------------------------------------------------
    --------------------------------------------------------------

    Net income                    $      48  $      17  $     948
    --------------------------------------------------------------
    --------------------------------------------------------------


    Funds under management               As at June 30, 2006
    --------------------------------------------------------------
    General fund                  $   2,839  $  10,258  $ 162,215
    Segregated funds                      -      2,371    146,200
    Mutual funds                          -          -     35,043
    Other funds                           -     20,845     26,186
    --------------------------------------------------------------
    Total                         $   2,839  $  33,474  $ 369,644
    --------------------------------------------------------------
    --------------------------------------------------------------

    Note 2: Comparatives

    Certain comparative amounts have been reclassified to conform with the
    current period's presentation.
    




For further information:

For further information: Media inquiries: Peter Fuchs, (416) 926-6103,
peter_fuchs@manulife.com; Investor Relations: Patricia Kelly,
1-800-795-9767, investor_relations@manulife.com


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