Condensed Consolidating Financial Information (Tables)

9 Months Ended

Sep. 30, 2014

Condensed Consolidating Balance Sheet

The following table presents the condensed consolidating balance sheet information as of September 30, 2014:

(Amounts in millions)	Parent Guarantor			Issuer			All Other Subsidiaries			Eliminations			Consolidated
Assets
Investments:
Fixed maturity securities available-for-sale, at fair value	$	—		$	151		$	62,366		$	(200	)	$	62,317
Equity securities available-for-sale, at fair value		—			—			313			—			313
Commercial mortgage loans		—			—			6,077			—			6,077
Restricted commercial mortgage loans related to securitization entities		—			—			209			—			209
Policy loans		—			—			1,512			—			1,512
Other invested assets		—			14			2,268			(1	)		2,281
Restricted other invested assets related to securitization entities, at fair value		—			—			404			—			404
Investments in subsidiaries		15,156			15,273			—			(30,429	)		—
Total investments		15,156			15,438			73,149			(30,630	)		73,113
Cash and cash equivalents		—			988			2,489			—			3,477
Accrued investment income		—			—			719			—			719
Deferred acquisition costs		—			—			5,085			—			5,085
Intangible assets		—			—			300			—			300
Goodwill		—			—			316			—			316
Reinsurance recoverable		—			—			17,374			—			17,374
Other assets		—			194			518			(2	)		710
Intercompany notes receivable		—			263			384			(647	)		—
Separate account assets		—			—			9,420			—			9,420
Total assets	$	15,156		$	16,883		$	109,754		$	(31,279	)	$	110,514
Liabilities and stockholders’ equity
Liabilities:
Future policy benefits	$	—		$	—		$	34,697		$	—		$	34,697
Policyholder account balances		—			—			25,827			—			25,827
Liability for policy and contract claims		—			—			7,987			—			7,987
Unearned premiums		—			—			4,085			—			4,085
Other liabilities		(10	)		276			3,341			(2	)		3,605
Intercompany notes payable		1			584			262			(847	)		—
Borrowings related to securitization entities		—			—			225			—			225
Non-recourse funding obligations		—			—			2,010			—			2,010
Long-term borrowings		—			4,151			511			—			4,662
Deferred tax liability		—			(950	)		1,825			—			875
Separate account liabilities		—			—			9,420			—			9,420
Total liabilities		(9	)		4,061			90,190			(849	)		93,393
Stockholders’ equity:
Common stock		1			—			—			—			1
Additional paid-in capital		11,991			9,162			17,079			(26,241	)		11,991
Accumulated other comprehensive income (loss)		3,934			3,913			3,930			(7,843	)		3,934
Retained earnings		1,939			(253	)		(3,406	)		3,659			1,939
Treasury stock, at cost		(2,700	)		—			—			—			(2,700	)
Total Genworth Financial, Inc.’s stockholders’ equity		15,165			12,822			17,603			(30,425	)		15,165
Noncontrolling interests		—			—			1,961			(5	)		1,956
Total stockholders’ equity		15,165			12,822			19,564			(30,430	)		17,121
Total liabilities and stockholders’ equity	$	15,156		$	16,883		$	109,754		$	(31,279	)	$	110,514

The following table presents the condensed consolidating balance sheet information as of December 31, 2013:

(Amounts in millions)	Parent Guarantor			Issuer			All Other Subsidiaries			Eliminations			Consolidated
Assets
Investments:
Fixed maturity securities available-for-sale, at fair value	$	—		$	150		$	58,679		$	(200	)	$	58,629
Equity securities available-for-sale, at fair value		—			—			341			—			341
Commercial mortgage loans		—			—			5,899			—			5,899
Restricted commercial mortgage loans related to securitization entities		—			—			233			—			233
Policy loans		—			—			1,434			—			1,434
Other invested assets		—			91			1,595			—			1,686
Restricted other invested assets related to securitization entities, at fair value		—			—			391			—			391
Investments in subsidiaries		14,358			14,929			—			(29,287	)		—
Total investments		14,358			15,170			68,572			(29,487	)		68,613
Cash and cash equivalents		—			1,219			2,995			—			4,214
Accrued investment income		—			—			682			(4	)		678
Deferred acquisition costs		—			—			5,278			—			5,278
Intangible assets		—			—			399			—			399
Goodwill		—			—			867			—			867
Reinsurance recoverable		—			—			17,219			—			17,219
Other assets		(2	)		276			367			(2	)		639
Intercompany notes receivable		8			248			393			(649	)		—
Separate account assets		—			—			10,138			—			10,138
Total assets	$	14,364		$	16,913		$	106,910		$	(30,142	)	$	108,045
Liabilities and stockholders’ equity
Liabilities:
Future policy benefits	$	—		$	—		$	33,705		$	—		$	33,705
Policyholder account balances		—			—			25,528			—			25,528
Liability for policy and contract claims		—			—			7,204			—			7,204
Unearned premiums		—			—			4,107			—			4,107
Other liabilities		(3	)		365			3,739			(5	)		4,096
Intercompany notes payable		—			601			248			(849	)		—
Borrowings related to securitization entities		—			—			242			—			242
Non-recourse funding obligations		—			—			2,038			—			2,038
Long-term borrowings		—			4,636			525			—			5,161
Deferred tax liability		(26	)		(796	)		1,028			—			206
Separate account liabilities		—			—			10,138			—			10,138
Total liabilities		(29	)		4,806			88,502			(854	)		92,425
Stockholders’ equity:
Common stock		1			—			—			—			1
Additional paid-in capital		12,127			9,297			17,215			(26,512	)		12,127
Accumulated other comprehensive income (loss)		2,542			2,507			2,512			(5,019	)		2,542
Retained earnings		2,423			303			(2,551	)		2,248			2,423
Treasury stock, at cost		(2,700	)		—			—			—			(2,700	)
Total Genworth Financial, Inc.’s stockholders’ equity		14,393			12,107			17,176			(29,283	)		14,393
Noncontrolling interests		—			—			1,232			(5	)		1,227
Total stockholders’ equity		14,393			12,107			18,408			(29,288	)		15,620
Total liabilities and stockholders’ equity	$	14,364		$	16,913		$	106,910		$	(30,142	)	$	108,045

Condensed Consolidating Income Statement

The following table presents the condensed consolidating income statement information for the three months ended September 30, 2014:

(Amounts in millions)	Parent Guarantor			Issuer			All Other Subsidiaries			Eliminations			Consolidated
Revenues:
Premiums	$	—		$	—		$	1,395		$	—		$	1,395
Net investment income		(1	)		—			810			(4	)		805
Net investment gains (losses)		—			9			(36	)		—			(27	)
Insurance and investment product fees and other		—			—			231			—			231
Total revenues		(1	)		9			2,400			(4	)		2,404
Benefits and expenses:
Benefits and other changes in policy reserves		—			—			1,986			—			1,986
Interest credited		—			—			185			—			185
Acquisition and operating expenses, net of deferrals		5			—			393			—			398
Amortization of deferred acquisition costs and intangibles		—			—			143			—			143
Goodwill impairment		—			—			550			—			550
Interest expense		—			77			41			(4	)		114
Total benefits and expenses		5			77			3,298			(4	)		3,376
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries		(6	)		(68	)		(898	)		—			(972	)
Provision (benefit) for income taxes		8			(16	)		(177	)		—			(185	)
Equity in income (loss) of subsidiaries		(830	)		(785	)		—			1,615			—
Income (loss) from continuing operations		(844	)		(837	)		(721	)		1,615			(787	)
Income from discontinued operations, net of taxes		—			—			—			—			—
Net income (loss)		(844	)		(837	)		(721	)		1,615			(787	)
Less: net income attributable to noncontrolling interests		—			—			57			—			57
Net income (loss) available to Genworth Financial, Inc.’s common stockholders	$	(844	)	$	(837	)	$	(778	)	$	1,615		$	(844	)

The following table presents the condensed consolidating income statement information for the three months ended September 30, 2013:

(Amounts in millions)	Parent Guarantor			Issuer			All Other Subsidiaries			Eliminations			Consolidated
Revenues:
Premiums	$	—		$	—		$	1,291		$	—		$	1,291
Net investment income		—			—			804			(3	)		801
Net investment gains (losses)		—			(4	)		(19	)		—			(23	)
Insurance and investment product fees and other		—			—			249			(1	)		248
Total revenues		—			(4	)		2,325			(4	)		2,317
Benefits and expenses:
Benefits and other changes in policy reserves		—			—			1,169			—			1,169
Interest credited		—			—			184			—			184
Acquisition and operating expenses, net of deferrals		8			31			368			—			407
Amortization of deferred acquisition costs and intangibles		—			—			182			—			182
Interest expense		—			82			46			(4	)		124
Total benefits and expenses		8			113			1,949			(4	)		2,066
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries		(8	)		(117	)		376			—			251
Provision (benefit) for income taxes		44			(39	)		100			—			105
Equity in income of subsidiaries		160			251			—			(411	)		—
Income from continuing operations		108			173			276			(411	)		146
Income (loss) from discontinued operations, net of taxes		—			(15	)		17			—			2
Net income		108			158			293			(411	)		148
Less: net income attributable to noncontrolling interests		—			—			40			—			40
Net income available to Genworth Financial, Inc.’s common stockholders	$	108		$	158		$	253		$	(411	)	$	108

The following table presents the condensed consolidating income statement information for the nine months ended September 30, 2014:

(Amounts in millions)	Parent Guarantor			Issuer			All Other Subsidiaries			Eliminations			Consolidated
Revenues:
Premiums	$	—		$	—		$	4,045		$	—		$	4,045
Net investment income		(1	)		—			2,435			(11	)		2,423
Net investment gains (losses)		—			—			(10	)		—			(10	)
Insurance and investment product fees and other		—			(3	)		687			(1	)		683
Total revenues		(1	)		(3	)		7,157			(12	)		7,141
Benefits and expenses:
Benefits and other changes in policy reserves		—			—			4,436			—			4,436
Interest credited		—			—			552			—			552
Acquisition and operating expenses, net of deferrals		15			—			1,165			—			1,180
Amortization of deferred acquisition costs and intangibles		—			—			415			—			415
Goodwill impairment		—			—			550			—			550
Interest expense		—			244			129			(12	)		361
Total benefits and expenses		15			244			7,247			(12	)		7,494
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries		(16	)		(247	)		(90	)		—			(353	)
Provision (benefit) for income taxes		13			(80	)		58			(4	)		(13	)
Equity in income (loss) of subsidiaries		(455	)		(389	)		—			844			—
Income (loss) from continuing operations		(484	)		(556	)		(148	)		848			(340	)
Income from discontinued operations, net of taxes		—			—			—			—			—
Net income (loss)		(484	)		(556	)		(148	)		848			(340	)
Less: net income attributable to noncontrolling interests		—			—			144			—			144
Net income (loss) available to Genworth Financial, Inc.’s common stockholders	$	(484	)	$	(556	)	$	(292	)	$	848		$	(484	)

The following table presents the condensed consolidating income statement information for the nine months ended September 30, 2013:

(Amounts in millions)	Parent Guarantor			Issuer			All Other Subsidiaries			Eliminations			Consolidated
Revenues:
Premiums	$	—		$	—		$	3,838		$	—		$	3,838
Net investment income		(1	)		1			2,446			(10	)		2,436
Net investment gains (losses)		—			(1	)		(62	)		—			(63	)
Insurance and investment product fees and other		—			—			784			(4	)		780
Total revenues		(1	)		—			7,006			(14	)		6,991
Benefits and expenses:
Benefits and other changes in policy reserves		—			—			3,639			—			3,639
Interest credited		—			—			552			—			552
Acquisition and operating expenses, net of deferrals		18			32			1,203			—			1,253
Amortization of deferred acquisition costs and intangibles		—			—			441			—			441
Interest expense		—			241			144			(14	)		371
Total benefits and expenses		18			273			5,979			(14	)		6,256
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries		(19	)		(273	)		1,027			—			735
Provision (benefit) for income taxes		39			(92	)		307			—			254
Equity in income of subsidiaries		410			567			—			(977	)		—
Income from continuing operations		352			386			720			(977	)		481
Income (loss) from discontinued operations, net of taxes		—			(29	)		17			—			(12	)
Net income		352			357			737			(977	)		469
Less: net income attributable to noncontrolling interests		—			—			117			—			117
Net income available to Genworth Financial, Inc.’s common stockholders	$	352		$	357		$	620		$	(977	)	$	352

Condensed Consolidating Statement of Comprehensive Income

The following table presents the condensed consolidating comprehensive income statement information for the three months ended September 30, 2014:

(Amounts in millions)	Parent Guarantor			Issuer			All Other Subsidiaries			Eliminations			Consolidated
Net income (loss)	$	(844	)	$	(837	)	$	(721	)	$	1,615		$	(787	)
Other comprehensive income (loss):
Net unrealized gains (losses) on securities not other-than-temporarily impaired		(62	)		(60	)		(67	)		121			(68	)
Net unrealized gains (losses) on other-than-temporarily impaired securities		1			2			1			(3	)		1
Derivatives qualifying as hedges		101			101			105			(206	)		101
Foreign currency translation and other adjustments		(267	)		(229	)		(379	)		496			(379	)
Total other comprehensive income (loss)		(227	)		(186	)		(340	)		408			(345	)
Total comprehensive income (loss)		(1,071	)		(1,023	)		(1,061	)		2,023			(1,132	)
Less: comprehensive income attributable to noncontrolling interests		—			—			(61	)		—			(61	)
Total comprehensive income (loss) available to Genworth Financial, Inc.’s common stockholders	$	(1,071	)	$	(1,023	)	$	(1,000	)	$	2,023		$	(1,071	)

The following table presents the condensed consolidating comprehensive income statement information for the three months ended September 30, 2013:

(Amounts in millions)	Parent Guarantor			Issuer			All Other Subsidiaries			Eliminations			Consolidated
Net income	$	108		$	158		$	293		$	(411	)	$	148
Other comprehensive income (loss):
Net unrealized gains (losses) on securities not other-than-temporarily impaired		(190	)		(183	)		(195	)		377			(191	)
Net unrealized gains (losses) on other-than-temporarily impaired securities		5			5			5			(10	)		5
Derivatives qualifying as hedges		(139	)		(139	)		(144	)		283			(139	)
Foreign currency translation and other adjustments		121			102			143			(222	)		144
Total other comprehensive income (loss)		(203	)		(215	)		(191	)		428			(181	)
Total comprehensive income (loss)		(95	)		(57	)		102			17			(33	)
Less: comprehensive income attributable to noncontrolling interests		—			—			62			—			62
Total comprehensive income (loss) available to Genworth Financial, Inc.’s common stockholders	$	(95	)	$	(57	)	$	40		$	17		$	(95	)

The following table presents the condensed consolidating comprehensive income statement information for the nine months ended September 30, 2014:

(Amounts in millions)	Parent Guarantor			Issuer			All Other Subsidiaries			Eliminations			Consolidated
Net income (loss)	$	(484	)	$	(556	)	$	(148	)	$	848		$	(340	)
Other comprehensive income (loss):
Net unrealized gains (losses) on securities not other-than-temporarily impaired		1,155			1,129			1,171			(2,284	)		1,171
Net unrealized gains (losses) on other-than-temporarily impaired securities		8			9			8			(17	)		8
Derivatives qualifying as hedges		434			434			460			(894	)		434
Foreign currency translation and other adjustments		(148	)		(109	)		(252	)		257			(252	)
Total other comprehensive income (loss)		1,449			1,463			1,387			(2,938	)		1,361
Total comprehensive income (loss)		965			907			1,239			(2,090	)		1,021
Less: comprehensive income attributable to noncontrolling interests		—			—			56			—			56
Total comprehensive income (loss) available to Genworth Financial, Inc.’s common stockholders	$	965		$	907		$	1,183		$	(2,090	)	$	965

The following table presents the condensed consolidating comprehensive income statement information for the nine months ended September 30, 2013:

(Amounts in millions)	Parent Guarantor			Issuer			All Other Subsidiaries			Eliminations			Consolidated
Net income	$	352		$	357		$	737		$	(977	)	$	469
Other comprehensive income (loss):
Net unrealized gains (losses) on securities not other-than-temporarily impaired		(1,586	)		(1,546	)		(1,624	)		3,132			(1,624	)
Net unrealized gains (losses) on other-than-temporarily impaired securities		57			57			57			(114	)		57
Derivatives qualifying as hedges		(467	)		(467	)		(484	)		951			(467	)
Foreign currency translation and other adjustments		(267	)		(256	)		(313	)		523			(313	)
Total other comprehensive income (loss)		(2,263	)		(2,212	)		(2,364	)		4,492			(2,347	)
Total comprehensive income (loss)		(1,911	)		(1,855	)		(1,627	)		3,515			(1,878	)
Less: comprehensive income attributable to noncontrolling interests		—			—			33			—			33
Total comprehensive income (loss) available to Genworth Financial, Inc.’s common stockholders	$	(1,911	)	$	(1,855	)	$	(1,660	)	$	3,515		$	(1,911	)

Condensed Consolidating Statement of Cash Flows

The following table presents the condensed consolidating cash flow statement information for the nine months ended September 30, 2014:

(Amounts in millions)	Parent Guarantor			Issuer			All Other Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	(484	)	$	(556	)	$	(148	)	$	848		$	(340	)
Adjustments to reconcile net income (loss) to net cash from operating activities:
Equity in (income) loss from subsidiaries		455			389			—			(844	)		—
Dividends from subsidiaries		—			563			(563	)		—			—
Amortization of fixed maturity discounts and premiums and limited partnerships		—			—			(87	)		—			(87	)
Net investment losses (gains)		—			—			10			—			10
Charges assessed to policyholders		—			—			(580	)		—			(580	)
Acquisition costs deferred		—			—			(356	)		—			(356	)
Amortization of deferred acquisition costs and intangibles		—			—			415			—			415
Goodwill impairment		—			—			550			—			550
Deferred income taxes		25			(137	)		(78	)		(4	)		(194	)
Net increase (decrease) in trading securities, held-for-sale investments and derivative instruments		—			—			110			—			110
Stock-based compensation expense		15			—			6			—			21
Change in certain assets and liabilities:
Accrued investment income and other assets		(2	)		44			(210	)		(4	)		(172	)
Insurance reserves		—			—			1,769			—			1,769
Current tax liabilities		(16	)		(37	)		(134	)		—			(187	)
Other liabilities and other policy-related balances		12			51			115			3			181
Net cash from operating activities		5			317			819			(1	)		1,140
Cash flows from investing activities:
Proceeds from maturities and repayments of investments:
Fixed maturity securities		—			—			3,775			—			3,775
Commercial mortgage loans		—			—			528			—			528
Restricted commercial mortgage loans related to securitization entities		—			—			24			—			24
Proceeds from sales of investments:
Fixed maturity and equity securities		—			—			1,745			—			1,745
Purchases and originations of investments:
Fixed maturity and equity securities		—			—			(7,464	)		—			(7,464	)
Commercial mortgage loans		—			—			(709	)		—			(709	)
Other invested assets, net		—			—			86			1			87
Policy loans, net		—			—			11			—			11
Intercompany notes receivable		8			(15	)		9			(2	)		—
Capital contributions to subsidiaries		(12	)		—			12			—			—
Net cash from investing activities		(4	)		(15	)		(1,983	)		(1	)		(2,003	)
Cash flows from financing activities:
Deposits to universal life and investment contracts		—			—			2,201			—			2,201
Withdrawals from universal life and investment contracts		—			—			(1,950	)		—			(1,950	)
Redemption and repurchase of non-recourse funding obligations		—			—			(28	)		—			(28	)
Proceeds from the issuance of long-term debt		—			—			144			—			144
Repayment and repurchase of long-term debt		—			(485	)		(136	)		—			(621	)
Repayment of borrowings related to securitization entities		—			—			(24	)		—			(24	)
Proceeds from sale of subsidiary shares to noncontrolling interests		—			—			517			—			517
Dividends paid to noncontrolling interests		—			—			(46	)		—			(46	)
Proceeds from intercompany notes payable		1			(17	)		14			2			—
Other, net		(2	)		(31	)		(11	)		—			(44	)
Net cash from financing activities		(1	)		(533	)		681			2			149
Effect of exchange rate changes on cash and cash equivalents		—			—			(23	)		—			(23	)
Net change in cash and cash equivalents		—			(231	)		(506	)		—			(737	)
Cash and cash equivalents at beginning of period		—			1,219			2,995			—			4,214
Cash and cash equivalents at end of period	$	—		$	988		$	2,489		$	—		$	3,477

The following table presents the condensed consolidating cash flow statement information for the nine months ended September 30, 2013:

(Amounts in millions)	Parent Guarantor			Issuer			All Other Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net income	$	352		$	357		$	737		$	(977	)	$	469
Less loss from discontinued operations, net of taxes		—			29			(17	)		—			12
Adjustments to reconcile net income to net cash from operating activities:
Equity in income from subsidiaries		(410	)		(567	)		—			977			—
Dividends from subsidiaries		135			230			(365	)		—			—
Amortization of fixed maturity discounts and premiums and limited partnerships		—			(1	)		(63	)		—			(64	)
Net investment losses (gains)		—			1			62			—			63
Charges assessed to policyholders		—			—			(612	)		—			(612	)
Acquisition costs deferred		—			—			(332	)		—			(332	)
Amortization of deferred acquisition costs and intangibles		—			—			441			—			441
Deferred income taxes		41			(70	)		(91	)		—			(120	)
Net increase (decrease) in trading securities, held-for-sale investments and derivative instruments		—			—			(15	)		—			(15	)
Stock-based compensation expense		18			—			9			—			27
Change in certain assets and liabilities:
Accrued investment income and other assets		4			61			(127	)		(4	)		(66	)
Insurance reserves		—			—			1,679			—			1,679
Current tax liabilities		(2	)		(8	)		252			—			242
Other liabilities and other policy-related balances		4			80			(787	)		4			(699	)
Cash from operating activities—discontinued operations		—			—			68			—			68
Net cash from operating activities		142			112			839			—			1,093
Cash flows from investing activities:
Proceeds from maturities and repayments of investments:
Fixed maturity securities		—			—			4,046			—			4,046
Commercial mortgage loans		—			—			686			—			686
Restricted commercial mortgage loans related to securitization entities		—			—			51			—			51
Proceeds from sales of investments:
Fixed maturity and equity securities		—			—			3,056			—			3,056
Purchases and originations of investments:
Fixed maturity and equity securities		—			—			(7,872	)		—			(7,872	)
Commercial mortgage loans		—			—			(667	)		—			(667	)
Other invested assets, net		—			—			80			—			80
Policy loans, net		—			—			(7	)		—			(7	)
Intercompany notes receivable		(11	)		6			96			(91	)		—
Capital contributions to subsidiaries		(131	)		(22	)		153			—			—
Proceeds from sale of a subsidiary, net of cash transferred		—			345			25			—			370
Cash from investing activities—discontinued operations		—			(30	)		—			—			(30	)
Net cash from investing activities		(142	)		299			(353	)		(91	)		(287	)
Cash flows from financing activities:
Deposits to universal life and investment contracts		—			—			1,979			—			1,979
Withdrawals from universal life and investment contracts		—			—			(2,613	)		—			(2,613	)
Redemption and repurchase of non-recourse funding obligations		—			—			(20	)		—			(20	)
Proceeds from the issuance of long-term debt		—			397			—			—			397
Repayment and repurchase of long-term debt		—			(365	)		—			—			(365	)
Repayment of borrowings related to securitization entities		—			—			(51	)		—			(51	)
Repurchase of subsidiary shares		—			—			(43	)		—			(43	)
Dividends paid to noncontrolling interests		—			—			(39	)		—			(39	)
Proceeds from intercompany notes payable		—			(86	)		(5	)		91			—
Other, net		—			(36	)		(17	)		—			(53	)
Cash from financing activities—discontinued operations		—			—			(3	)		—			(3	)
Net cash from financing activities		—			(90	)		(812	)		91			(811	)
Effect of exchange rate changes on cash and cash equivalents		—			—			(94	)		—			(94	)
Net change in cash and cash equivalents		—			321			(420	)		—			(99	)
Cash and cash equivalents at beginning of period		—			843			2,810			—			3,653
Cash and cash equivalents at end of period		—			1,164			2,390			—			3,554
Less cash and cash equivalents of discontinued operations at end of period		—			—			—			—			—
Cash and cash equivalents of continuing operations at end of period	$	—		$	1,164		$	2,390		$	—		$	3,554