The after-tax adjusted operating income of Prudential Financial was $742m for the reported quarter compared to $1.26bn reported for the second quarter of 2019
Prudential Financial has reported a net loss of $2.4bn or $6.12 per share for the second quarter of 2020 (Q2 2020), compared to $798m net income or $1.71 per share, made in the same quarter in 2019.
In the previous quarter, that is Q1 2020, the US insurance company had a net loss of $271m or $0.70 per share.
The insurer’s after-tax adjusted operating income was $742m for the reported quarter compared to $1.26bn reported for the second quarter of 2019.
Prudential Financial’s global investment management business – PGIM, registered adjusted operating income of $324m in Q2 2020, compared to $264m made in the same quarter in the previous year. The insurer attributed the increase in the operating income on higher other related revenue, which was due to increased strategic investment earnings, reduced expenses, and higher asset management fees.
PGIM’s assets under management grew by 9% to $1.39 trillion from the year-ago quarter.
The insurer’s US businesses unit had an adjusted operating income of $455m in Q2 2020 in comparison to $875m made during the same quarter in the previous year. The drop in the adjusted operating income was because of a net unfavorable comparative impact from the group’s annual reviews and update of assumptions and other refinements, which totaled $182m.
The company’s US workplace solutions unit, which is made up of retirement and group insurance, had an adjusted operating income of $286m in Q2 2020. In the same quarter of the year before, the US workplace solutions unit made $548m in adjusted operating income.
Prudential Financial CEO comments on Q2 2020 results
Prudential Financial chairman and CEO Charles Lowrey said: “During the second quarter, we displayed resiliency amidst the effects of the pandemic and economic and market shocks while continuing to execute against our 2020 priorities with urgency, benefiting from our complementary business mix, our rock-solid balance sheet, and our carefully constructed risk profile.
“We remain on track to achieve our targeted $140 million of cost savings for the year and are making progress in transitioning our international earnings base to higher-growth markets.
“We also continue to address the impact of the low interest rate environment through aggressive repricing and by pivoting to less rate-sensitive products. We are examining ways to further reduce the sensitivity to interest rates and exploring the potential to generate cost savings on top of our existing 2022 target of $500 million.”
Earlier this year, Prudential Financial signed a deal to divest its Korean life insurance subsidiary to KB Financial Group, a South Korea-based financial services provider, for around KRW2.3 trillion ($1.9bn).