-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KQc8v44FJL2buo0CmibFN7zOwY19mKEDiDJQtELT0YcwJ3SJO04wi1oeDQYd1N6r /48MHHQhp63oeTnlrKEOFA== 0001068800-07-001466.txt : 20071022 0001068800-07-001466.hdr.sgml : 20071022 20071022172125 ACCESSION NUMBER: 0001068800-07-001466 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20071022 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20071022 DATE AS OF CHANGE: 20071022 FILER: COMPANY DATA: COMPANY CONFORMED NAME: REINSURANCE GROUP OF AMERICA INC CENTRAL INDEX KEY: 0000898174 STANDARD INDUSTRIAL CLASSIFICATION: ACCIDENT & HEALTH INSURANCE [6321] IRS NUMBER: 431627032 STATE OF INCORPORATION: MO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11848 FILM NUMBER: 071183754 BUSINESS ADDRESS: STREET 1: 1370 TIMBERLAKE MANOR PARKWAY CITY: CHESTERFIELD STATE: MO ZIP: 63017-6039 BUSINESS PHONE: 6367367000 MAIL ADDRESS: STREET 1: 1370 TIMBERLAKE MANOR PARKWAY CITY: CHESTERFIELD STATE: MO ZIP: 63017-6039 8-K 1 rga8k.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of Earliest Event Reported): October 22, 2007 REINSURANCE GROUP OF AMERICA, INCORPORATED (Exact Name of Registrant as Specified in its Charter) MISSOURI 1-11848 43-1627032 (State or Other Jurisdiction of (Commission (IRS Employer Incorporation) File Number) Identification Number) 1370 TIMBERLAKE MANOR PARKWAY, CHESTERFIELD, MISSOURI 63017 (Address of Principal Executive Office) Registrant's telephone number, including area code: (636) 736-7000 Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION On October 22, 2007, Reinsurance Group of America, Incorporated issued a press release announcing its earnings for the three-month period ended September 30, 2007 and providing certain additional information. The press release also notes that a conference call will be held on October 23, 2007 to discuss the financial and operating results for the three-month period ended September 30, 2007. A copy of the press release is furnished with this report as Exhibit 99.1 and shall not be deemed filed pursuant to Instruction B.2 of Form 8-K. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS (d) Exhibits Exhibit No. Exhibit ----------- ------- 99.1 Press Release of Reinsurance Group of America, Incorporated dated October 22, 2007 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. REINSURANCE GROUP OF AMERICA, INCORPORATED Date: October 22, 2007 By: /s/ Jack B. Lay ------------------------------ Jack B. Lay Senior Executive Vice President and Chief Financial Officer EXHIBIT INDEX Exhibit No. Exhibit ----------- ------- 99.1 Press Release of Reinsurance Group of America, Incorporated dated October 22, 2007. EX-99.1 2 ex99p1.txt Exhibit 99.1 [RGA logo] Reinsurance Group of America, Incorporated(R) For further information, contact Jack B. Lay Senior Executive Vice President and Chief Financial Officer (636) 736-7000 FOR IMMEDIATE RELEASE - --------------------- REINSURANCE GROUP OF AMERICA REPORTS THIRD-QUARTER RESULTS ---------------------------------------------------------- ST. LOUIS, October 22, 2007 - Reinsurance Group of America, Incorporated (NYSE:RGA), a leading global provider of life reinsurance, reported net income for the third quarter of $76.5 million, or $1.19 per diluted share, compared to $74.0 million, or $1.17 per diluted share, in the prior-year quarter. RGA uses a non-GAAP financial measure called operating income as a basis for analyzing financial results. The definition of operating income and reconciliations to GAAP net income are provided in the following tables. Operating income increased 28 percent to $95.6 million, or $1.49 per diluted share, from $74.7 million, or $1.18 per diluted share, in the year-ago quarter. On a per share basis, operating income increased 26 percent. Third-quarter net premiums rose 14 percent, to $1,227.9 million, from $1,076.2 million a year ago. Net investment income totaled $190.5 million versus $183.4 million the year before. For the first nine months of 2007, net income totaled $230.2 million or $3.59 per diluted share, compared to $206.7 million, or $3.29 per diluted share, in the year-ago period. Operating income totaled $262.3 million, or $4.08 per diluted share, compared to $212.2 million, or $3.38 per diluted share, in the prior-year period, a 21 percent increase on a per share basis. Consolidated net premiums were up 13 percent, to $3,561.0 million from $3,145.2 million. A. Greig Woodring, president and chief executive officer, commented, "We reported solid earnings, with notably strong results in Canada and Asia Pacific more than offsetting slightly high claim levels in the Europe and South Africa operating segment. The U.S. segment reported pre-tax net income totaling $66.2 million for the quarter versus $84.8 million the year before. That decrease is primarily a result of a $13.8 million decrease, net of deferred acquisition costs, in the value of embedded derivatives due to the impact of widening credit spreads in the U.S. debt markets. Additionally, pre-tax net income includes $10.9 million in realized losses, - more - Add One primarily from the sales of investment securities as we refined duration on certain portfolios. Pre-tax operating income increased 6 percent to $89.9 million from $84.9 million the year before. Claim levels were within an expected range in the Traditional segment. Additionally, capital losses on securities sales within the funds withheld portfolios reduced net investment income within the Asset Intensive segment. Net premiums were up 7 percent to $691.9 million from $648.1 million in the prior-year quarter. On a year-to-date basis, net premiums have increased 8 percent. "Our Canada operations reported another strong quarter on favorable mortality, with pre-tax net income of $22.8 million compared to $13.5 million a year ago. Pre-tax operating income totaled $20.3 million, up substantially from $12.1 million a year ago. Net premiums increased 20 percent to $123.7 million from $103.3 million in the prior year. On a year-to-date basis, premiums are up 17 percent. Net premiums for the third quarter of 2007 were favorably affected by currency exchange rates relative to the prior year by approximately $8.4 million, as the Canadian dollar strengthened relative to the U.S. dollar. The impact of foreign currency fluctuations favorably affected pre-tax operating income by approximately $1.9 million. "Asia Pacific reported a good quarter as well with strong premium flow and favorable segment-wide claims experience. Pre-tax net income totaled $17.2 million compared with $20.4 million in the year-ago quarter while pre-tax operating income totaled $17.6 million compared with $20.4 million a year ago. The prior-quarter result was quite strong making for a challenging comparison. Net premiums increased 35 percent to $240.5 million from $178.5 million, with particularly strong premium flow in South Korea. Foreign currency fluctuations favorably affected net premiums and pre-tax operating income by approximately $13.6 million and $1.5 million, respectively. "Europe and South Africa experienced slightly high claim levels. Pre-tax net income totaled $11.7 million compared to $8.8 million a year ago and pre-tax operating income totaled $12.6 million versus $8.9 million last year, a period in which we experienced unfavorable mortality. Net premiums increased 17 percent to $170.8 million. Foreign currency exchange fluctuations favorably affected reported net premiums and pre-tax operating income by approximately $11.4 million and $1.4 million, respectively, due primarily to a relatively strong British pound and euro. "The Corporate and Other segment benefited by $9.4 million, pretax, primarily from the reversal of accrued interest expense associated with certain tax positions, as required under the - more - Add Two accounting guidance commonly referred to as "FIN 48". Those tax positions were favorably resolved during the quarter. Additionally, our consolidated effective tax rate of 33.6 percent was below historical levels due to the resolution of these tax positions and various other tax accrual adjustments. We would expect our effective tax rate to return to a more normal level in the fourth quarter." Woodring concluded, "We are pleased with the results for the quarter and the first nine months of the year. Each of our segments has performed very well on a year-to-date basis. The RGA franchise continues to be recognized as a preeminent player in the global life reinsurance market and we believe we are well positioned to take advantage of substantial growth opportunities in several international markets. Additionally, we believe we can enhance our already strong positions in the U.S. and Canadian markets through additional product offerings and increased market share." The company also announced that its board of directors declared a regular quarterly dividend of $0.09, payable November 28 to shareholders of record as of November 7. A conference call to discuss the company's third-quarter results will begin at 9 a.m. Eastern Time on Tuesday, October 23. Interested parties may access the call by dialing 800-210-9006 (domestic) or 719-457-2621 (international). The access code is 9614741. A live audio webcast of the conference call will be available on the company's investor relations web page at www.rgare.com. A replay of the conference call will be available at the same address for three months following the conference call. A replay of the conference call will also be available via telephone through October 30 at 888-203-1112 (domestic) or 719-457-0820, access code 9614741. Reinsurance Group of America, Incorporated, through its various operating subsidiaries, is among the largest global providers of life reinsurance. Reinsurance Group of America, Incorporated has subsidiary companies or offices in Australia, Barbados, Bermuda, Canada, China, France, Germany, Hong Kong, India, Ireland, Italy, Japan, Mexico, Poland, South Africa, South Korea, Spain, Taiwan, the United Kingdom and the United States. Worldwide, the company has approximately $2.2 trillion of life reinsurance in force, and assets of $21.1 billion. MetLife, Inc. is the beneficial owner of approximately 52 percent of RGA's outstanding shares. - more - Add Three CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS - --------------------------------------------------------- This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, among others, statements relating to projections of the earnings, revenues, income or loss, future financial performance and growth potential of Reinsurance Group of America, Incorporated and its subsidiaries (which we refer to in the following paragraphs as "we," "us" or "our"). The words "intend," "expect," "project," "estimate," "predict," "anticipate," "should," "believe," and other similar expressions also are intended to identify forward-looking statements. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Future events and actual results, performance and achievements could differ materially from those set forth in, contemplated by or underlying the forward-looking statements. Numerous important factors could cause actual results and events to differ materially from those expressed or implied by forward-looking statements including, without limitation, (1) adverse changes in mortality, morbidity, lapsation or claims experience, (2) changes in our financial strength and credit ratings or those of MetLife, Inc. ("MetLife"), the beneficial owner of a majority of our common shares, or its subsidiaries, and the effect of such changes on our future results of operations and financial condition, (3) inadequate risk analysis and underwriting, (4) general economic conditions or a prolonged economic downturn affecting the demand for insurance and reinsurance in our current and planned markets, (5) the availability and cost of collateral necessary for regulatory reserves and capital, (6) market or economic conditions that adversely affect our ability to make timely sales of investment securities, (7) risks inherent in our risk management and investment strategy, including changes in investment portfolio yields due to interest rate or credit quality changes, (8) fluctuations in U.S. or foreign currency exchange rates, interest rates, or securities and real estate markets, (9) adverse litigation or arbitration results, (10) the adequacy of reserves, resources and accurate information relating to settlements, awards and terminated and discontinued lines of business, (11) the stability of and actions by governments and economies in the markets in which we operate, (12) competitive factors and competitors' responses to our initiatives, (13) the success of our clients, (14) successful execution of our entry into new markets, (15) successful development and introduction of new products and distribution opportunities, (16) our ability to successfully integrate and operate reinsurance business that we acquire, (17) regulatory action that may be taken by state Departments of - more - Add Four Insurance with respect to us, MetLife, or its subsidiaries, (18) our dependence on third parties, including those insurance companies and reinsurers to which we cede some reinsurance, third-party investment managers and others, (19) the threat of natural disasters, catastrophes, terrorist attacks, epidemics or pandemics anywhere in the world where we or our clients do business, (20) changes in laws, regulations, and accounting standards applicable to us, our subsidiaries, or our business, (21) the effect of our status as an insurance holding company and regulatory restrictions on our ability to pay principal of and interest on our debt obligations, and (22) other risks and uncertainties described in this document and in our other filings with the Securities and Exchange Commission. Forward-looking statements should be evaluated together with the many risks and uncertainties that affect our business, including those mentioned in this document and described in the periodic reports we file with the Securities and Exchange Commission. These forward-looking statements speak only as of the date on which they are made. We do not undertake any obligations to update these forward-looking statements, even though our situation may change in the future. We qualify all of our forward-looking statements by these cautionary statements. - tables attached - Add Five Operating Income RGA uses a non-GAAP financial measure called operating income as a basis for analyzing financial results. This measure also serves as a basis for establishing target levels and awards under RGA's management incentive programs. Management believes that operating income, on a pre-tax and after-tax basis, better measures the ongoing profitability and underlying trends of the company's continuing operations, primarily because that measure excludes the effect of net investment related gains and losses, as well as changes in the fair value of embedded derivatives and related deferred acquisition costs. These items tend to be highly variable, primarily due to the credit market and interest rate environment and are not necessarily indicative of the performance of the company's underlying businesses. Additionally, operating income excludes any net gain or loss from discontinued operations and the cumulative effect of any accounting changes, which management believes are not indicative of the company's ongoing operations. The definition of operating income can vary by company and is not considered a substitute for GAAP net income. REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Reconciliation of Net Income From Continuing Operations to Operating Income (Dollars in thousands) (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, ---------------------------------------- 2007 2006 2007 2006 ---- ---- ---- ---- GAAP net income-continuing operations $ 80,797 $ 75,574 $236,771 $209,943 Investment related losses, net 6,413 185 16,733 3,267 Change in value of embedded derivatives 34,434 (2,776) 37,221 1,463 DAC offset for embedded derivatives and investment related (gains)/losses, net (26,052) 1,706 (28,431) (2,463) --------------------------------------- Operating income $ 95,592 $ 74,689 $262,294 $212,210 - more - Add Six REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Reconciliation of Pre-tax Net Income From Continuing Operations to Pre-tax Operating Income (Dollars in thousands) (Unaudited) Three Months Ended September 30, 2007 Investment Change in Pre-tax related value of Pre-tax net (gains) embedded operating income losses, derivatives, income (loss) net net (loss) ------- ---------- ------------ -------- U.S. Operations: Traditional $ 75,288 $ 5,457 $ -- $ 80,745 Asset Intensive (13,478) 4,493(1) 13,812(2) 4,827 Financial Reinsurance 4,342 2 -- 4,344 --------------------------------------------- Total U.S. 66,152 9,952 13,812 89,916 Canada Operations 22,798 (2,480) -- 20,318 Europe & South Africa 11,689 863 -- 12,552 Asia Pacific Operations 17,240 367 -- 17,607 Corporate and Other 3,851 (247) -- 3,604 --------------------------------------------- Consolidated $121,730 $ 8,455 $13,812 $143,997 ============================================= (1) Asset Intensive is net of $(916)DAC offset. (2) Asset Intensive is net of DAC offsets of $(39,163) included in change in deferred acquisition cost associated with change in value of embedded derivative. (Unaudited) Three Months Ended September 30, 2006 Investment Change in Pre-tax related value of Pre-tax net (gains)/ embedded operating income losses, derivatives, income (loss) net net (loss) ------- ---------- ------------ -------- U.S. Operations: Traditional $ 75,757 $ (200) $ -- $ 75,557 Asset Intensive 5,277 1,736(1) (1,386)(2) 5,627 Financial Reinsurance 3,768 (4) -- 3,764 --------------------------------------------- Total U.S. 84,802 1,532 (1,386) 84,948 Canada Operations 13,462 (1,312) -- 12,150 Europe & South Africa 8,813 91 -- 8,904 Asia Pacific Operations 20,378 46 -- 20,424 Corporate & Other (9,886) (387) -- (10,273) --------------------------------------------- Consolidated $117,569 $ (30) $(1,386) $116,153 ============================================= (1) Asset Intensive is net of $(262)DAC offset. (2) Asset Intensive is net of DAC offsets of $2,886 included in change in deferred acquisition cost associated with change in value of embedded derivative. - more - Add Seven REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Reconciliation of Pre-tax Net Income From Continuing Operations to Pre-tax Operating Income (Dollars in thousands, except per share data) (Unaudited) Nine Months Ended September 30, 2007 Pre-tax Investment Change in Pre-tax net related value of operating income (gains)/ embedded income (loss) losses, net derivative (loss) ------ ----------- ---------- ------ U.S. Operations: Traditional $240,397 $ 10,292 $ -- $250,689 Asset Intensive (4,905) 6,198(1) 14,662(2) 15,955 Financial Reinsurance 10,052 9 -- 10,061 ------------------------------------------- Total U.S. 245,544 16,499 14,662 276,705 Canada Operations 62,034 (6,648) -- 55,386 Europe & South Africa 44,659 1,717 -- 46,376 Asia Pacific Operations 43,181 937 -- 44,118 Corporate & Other (30,745) 11,568 -- (19,177) ------------------------------------------- Consolidated $364,673 $ 24,073 $14,662 $403,408 =========================================== (1) Asset Intensive is net of $(1,138)DAC offset. (2) Asset Intensive is net of DAC offsets of $(42,601)included in change in deferred acquisition cost associated with change in value of embedded derivative. (Unaudited) Nine Months Ended September 30, 2006 Pre-tax Investment Change in Pre-tax net related value of operating income (gains)/ embedded income (loss) losses, net derivative (loss) ------ ----------- ---------- ------ U.S. Operations: Traditional $212,487 $ 3,535 $ -- $216,022 Asset Intensive 12,284 6,391(1) (88)(2) 18,587 Financial Reinsurance 11,302 (4) -- 11,298 ------------------------------------------- Total U.S. 236,073 9,922 (88) 245,907 Canada Operations 32,967 (3,307) -- 29,660 Europe & South Africa 40,879 238 -- 41,117 Asia Pacific Operations 34,717 123 -- 34,840 Corporate & Other (21,433) (3,362) -- (24,795) ------------------------------------------- Consolidated $323,203 $ 3,614 $ (88) $326,729 =========================================== (1) Asset Intensive is net of $(1,451)DAC offset. (2) Asset Intensive is net of DAC offsets of $(2,339)included in change in deferred acquisition cost associated with change in value of embedded derivative. - more - Add Eight REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Condensed Consolidated Statements of Income (Dollars in thousands) Three Months Ended Nine Months Ended (Unaudited) September 30, September 30, - --------------------------------------------------------------------- 2007 2006 2007 2006 ---- ---- ---- ---- Revenues: Net premiums $1,227,907 $1,076,191 $3,561,003 $3,145,236 Investment income, net of related expenses 190,458 183,357 681,103 538,903 Investment related losses, net (9,138) (125) (24,714) (4,807) Change in value of embedded derivatives (52,975) 4,272 (57,263) (2,251) Other revenues 22,089 18,788 61,637 47,035 --------------------- --------------------- Total revenues 1,378,341 1,282,483 4,221,766 3,724,116 Benefits and expenses: Claims and other policy benefits 1,006,864 846,908 2,890,012 2,532,952 Interest credited 30,475 43,582 205,193 149,843 Policy acquisition costs and other insurance expenses 178,244 188,731 542,679 513,235 Change in deferred acquisition cost associated with change in value of embedded derivatives (39,163) 2,886 (42,601) (2,339) Other operating expenses 57,284 54,568 169,325 146,925 Interest expense 9,860 15,103 53,545 46,884 Collateral finance facilities expense 13,047 13,136 38,940 13,413 --------------------- --------------------- Total benefits and expenses 1,256,611 1,164,914 3,857,093 3,400,913 --------------------- --------------------- Income from continuing operations before income taxes 121,730 117,569 364,673 323,203 Provision for income taxes 40,932 41,995 127,901 113,260 ------------------- --------------------- Income from continuing operations 80,798 75,574 236,772 209,943 Discontinued operations: Loss from discontinued accident and health operations, net of income taxes (4,277) (1,539) (6,524) (3,207) ------------------- --------------------- Net income $76,521 $74,035 $ 230,248 $ 206,736 =================== ===================== - more - Add Nine REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Condensed Consolidated Statements of Income (In thousands, except per share data) Three Months Ended Nine Months Ended (Unaudited) September 30, September 30, - -------------------------------------------------------------------------- 2007 2006 2007 2006 ---- ---- ---- ---- Earnings per share from continuing operations: Basic earnings per share $ 1.30 $ 1.23 $ 3.83 $ 3.43 Diluted earnings per share $ 1.26 $ 1.20 $ 3.69 $ 3.34 Diluted earnings before investment related gains/ (losses), change in value of embedded derivatives, and related deferred acquisition costs $ 1.49 $ 1.18 $ 4.08 $ 3.38 Earnings per share from net income: Basic earnings per share $ 1.23 $ 1.21 $ 3.73 $ 3.38 Diluted earnings per share $ 1.19 $ 1.17 $ 3.59 $ 3.29 Weighted average number of common and common equivalent shares outstanding 64,212 63,105 64,218 62,811 - more - Add Ten REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Condensed Consolidated Business Summary At or For the Nine Months Ended (Unaudited) September 30, - ---------------------------------------------------------------------- 2007 2006 ---- ---- Gross life reinsurance in force (in billions) U.S. $1,212.8 $1,145.7 Canada $ 211.3 $ 154.0 Europe & South Africa $ 370.9 $ 324.8 Asia Pacific $ 358.6 $ 274.6 Gross life reinsurance written (in billions) U.S. $ 120.9 $ 132.7 Canada $ 33.7 $ 28.1 Europe & South Africa $ 42.2 $ 91.2 Asia Pacific $ 27.7 $ 27.6 Balance sheet information (in millions, except share and per share figures) Consolidated cash and invested assets $16,312.1 $14,351.3 Invested asset book yield - trailing three months excluding funds withheld 6.00% 5.79% Investment portfolio mix Cash and short-term investments 3.71% 2.05% Fixed maturity securities 54.76% 57.77% Mortgage loans 5.07% 4.67% Policy loans 6.24% 6.72% Funds withheld at interest 28.53% 27.26% Other invested assets 1.69% 1.53% Collateral finance facilities $ 850.3 $ 850.3 Short-term debt $ 30.7 $ 28.1 Long-term debt $ 896.0 $ 674.7 Company-obligated mandatorily redeemable preferred securities of subsidiary $ 158.8 $ 158.7 Total stockholders' equity $3,040.0 $2,775.0 Less: Accumulated other comprehensive income "AOCI"* 444.4 480.3 -------- -------- Total stockholders' equity, before impact of AOCI* $2,595.6 $2,294.7 Treasury shares 1,129,184 1,761,365 Common shares outstanding 61,999,089 61,366,908 Book value per share outstanding $ 49.03 $ 45.22 Book value per share outstanding, before impact of AOCI* $ 41.86 $ 37.39 * Book value per share outstanding and total stockholders' equity, before impact of AOCI, are non-GAAP financial measures that management believes are important in evaluating the balance sheet in order to ignore the effects of unrealized amounts primarily associated with mark-to-market adjustments on investments and foreign currency translation. - more - Add Eleven REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES U.S. Operations (Unaudited) (Dollars in thousands) Three Months Ended September 30, 2007 Asset- Financial Total Revenues: Traditional Intensive Reinsurance U.S. ----------- --------- ----------- ------ Net premiums $ 690,388 $ 1,555 $ -- $691,943 Investment income, net of related expenses 89,221 28,870 (9) 118,082 Investment related losses, net (5,457) (5,409) (2) (10,868) Change in value of embedded derivatives -- (52,975) -- (52,975) Other revenues 242 11,095 7,205 18,542 -------------------------------------------- Total revenues 774,394 (16,864) 7,194 764,724 Benefits and expenses: Claims and other policy benefits 572,871 2,280 -- 575,151 Interest credited 14,845 15,457 -- 30,302 Policy acquisition costs and other insurance expenses 99,759 16,283 1,831 117,873 Change in deferred ac- quisition cost associated with change in value of embedded derivatives -- (39,163) -- (39,163) Other operating expenses 11,631 1,757 1,021 14,409 -------------------------------------------- Total benefits and expenses 699,106 (3,386) 2,852 698,572 Income/(loss)before income taxes $ 75,288 $ (13,478) $ 4,342 $ 66,152 ========== ========= ======= ======== (Unaudited) Three Months Ended September 30, 2006 Asset- Financial Total Revenues: Traditional Intensive Reinsurance U.S. ----------- --------- ----------- ------ Net premiums $ 646,529 $ 1,559 $ -- $648,088 Investment income, net of related expenses 76,900 48,473 (7) 125,366 Investment related gains/(losses), net 200 (1,998) 4 (1,794) Change in value of embedded derivatives -- 4,272 -- 4,272 Other revenues 271 7,263 7,584 15,118 -------------------------------------------- Total revenues 723,900 59,569 7,581 791,050 Benefits and expenses: Claims and other policy benefits 514,259 1,069 3 515,331 Interest credited 12,337 30,824 -- 43,161 Policy acquisition costs and other insurance expenses 109,213 17,644 2,392 129,249 Change in deferred ac- quisition cost associated with change in value of embedded derivatives -- 2,886 -- 2,886 Other operating expenses 12,334 1,869 1,418 15,621 -------------------------------------------- Total benefits and expenses 648,143 54,292 3,813 706,248 Income before income taxes $ 75,757 $ 5,277 $ 3,768 $ 84,802 ========== ========= ======== ======== - more - Add Twelve REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES U.S. Operations (Dollars in thousands) (Unaudited) Nine Months Ended September 30, 2007 Asset- Financial Total Revenues: Traditional Intensive Reinsurance U.S. ----------- --------- ----------- ------ Net premiums $ 2,078,560 $ 4,779 $ -- $2,083,339 Investment income, net of related expenses 261,300 214,141 110 475,551 Investment related losses, net (10,292) (7,336) (9) (17,637) Change in value of embedded derivatives -- (57,263) -- (57,263) Other revenues 648 28,209 18,940 47,797 ---------------------------------------------- Total revenues 2,330,216 182,530 19,041 2,531,787 Benefits and expenses: Claims and other policy benefits 1,710,076 6,250 1 1,716,327 Interest credited 43,694 159,939 -- 203,633 Policy acquisition costs and other insurance expenses 300,946 58,764 6,026 365,736 Change in deferred ac- quisition cost associated with change in value of embedded derivatives -- (42,601) -- (42,601) Other operating expenses 35,103 5,083 2,962 43,148 ------------------------------------------- Total benefits and expenses 2,089,819 187,435 8,989 2,286,243 Income/(loss)before income taxes $ 240,397 $ (4,905) $ 10,052 $ 245,544 =========== ========= ======== ========== (Unaudited) Nine Months Ended September 30, 2006 Asset- Financial Total Revenues: Traditional Intensive Reinsurance U.S. ----------- --------- ----------- ------ Net premiums $ 1,920,667 $ 4,638 $ -- $1,925,305 Investment income, net of related expenses 222,599 167,794 (162) 390,231 Investment related gains/(losses), net (3,535) (7,842) 4 (11,373) Change in value of embedded derivatives -- (2,251) -- (2,251) Other revenues 227 14,460 22,390 37,077 ---------------------------------------------- Total revenues 2,139,958 176,799 22,232 2,338,989 Benefits and expenses: Claims and other policy benefits 1,568,045 927 4 1,568,976 Interest credited 35,620 112,291 -- 147,911 Policy acquisition costs and other insurance expenses 292,614 48,578 7,052 348,244 Change in deferred ac- quisition cost associated with change in value of embedded derivatives -- (2,339) -- (2,339) Other operating expenses 31,192 5,058 3,874 40,124 ---------------------------------------------- Total benefits and expenses 1,927,471 164,515 10,930 2,102,916 Income before income taxes $ 212,487 $ 12,284 $ 11,302 $ 236,073 =========== ========= ======== ========== - more - Add Thirteen REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Canada Operations (Dollars in thousands) Three Months Ended (Unaudited) September 30, - --------------------------------------------------------------------- 2007 2006 ---- ---- Revenues: Net premiums $ 123,676 $103,316 Investment income, net of related expenses 31,057 27,578 Investment related gains, net 2,713 1,419 Other revenues 1 (452) -------- -------- Total revenues 157,447 131,861 Benefits and expenses: Claims and other policy benefits 106,416 95,854 Interest credited 170 211 Policy acquisition costs and other insurance expenses 23,118 18,146 Other operating expenses 4,945 4,188 -------- -------- Total benefits and expenses 134,649 118,399 Income before income taxes $ 22,798 $ 13,462 ======== ======== Nine Months Ended (Unaudited) September 30, - --------------------------------------------------------------------- 2007 2006 ---- ---- Revenues: Net premiums $345,748 $294,838 Investment income, net of related expenses 89,852 78,881 Investment related gains, net 7,145 3,565 Other revenues 180 315 -------- -------- Total revenues 442,925 377,599 Benefits and expenses: Claims and other policy benefits 303,231 280,382 Interest credited 541 623 Policy acquisition costs and other insurance expenses 62,937 51,735 Other operating expenses 14,182 11,892 -------- -------- Total benefits and expenses 380,891 344,632 Income before income taxes $ 62,034 $ 32,967 ======== ======== - more - Add Fourteen REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Europe & South Africa (Dollars in thousands) Three Months Ended (Unaudited) September 30, - -------------------------------------------------------------------- 2007 2006 ---- ---- Revenues: Net premiums $170,774 $145,769 Investment income, net of related expenses 5,569 4,210 Investment related losses, net (863) (91) Other revenues (43) 206 -------- --------- Total revenues 175,437 150,094 Benefits and expenses: Claims and other policy benefits 127,281 101,492 Interest credited 3 133 Policy acquisition costs and other insurance expenses 22,592 28,110 Other operating expenses 13,872 11,546 -------- -------- Total benefits and expenses 163,748 141,281 Income before income taxes $ 11,689 $ 8,813 ======== ======== Nine Months Ended (Unaudited) September 30, - -------------------------------------------------------------------- 2007 2006 ---- ---- Revenues: Net premiums $503,366 $436,993 Investment income, net of related expenses 18,446 11,475 Investment related losses, net (1,717) (238) Other revenues 61 119 -------- -------- Total revenues 520,156 448,349 Benefits and expenses: Claims and other policy benefits 370,263 308,172 Interest credited 1,019 479 Policy acquisition costs and other insurance expenses 65,781 69,188 Other operating expenses 38,434 29,631 -------- -------- Total benefits and expenses 475,497 407,470 Income before income taxes $ 44,659 $ 40,879 ======== ======== - more - Add Fifteen REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Asia Pacific (Dollars in thousands) Three Months Ended (Unaudited) September 30, - -------------------------------------------------------------------- 2007 2006 ---- ---- Revenues: Net premiums $240,476 $178,550 Investment income, net of related expenses 9,134 7,036 Investment related losses, net (367) (46) Other revenues 2,105 1,243 -------- -------- Total revenues 251,348 186,783 Benefits and expenses: Claims and other policy benefits 197,827 134,177 Policy acquisition costs and other insurance expenses 22,833 20,658 Other operating expenses 13,448 11,570 -------- -------- Total benefits and expenses 234,108 166,405 Income before income taxes $ 17,240 $ 20,378 ======== ======== Nine Months Ended (Unaudited) September 30, - -------------------------------------------------------------------- 2007 2006 ---- ---- Revenues: Net premiums $626,285 $486,615 Investment income, net of related expenses 26,407 20,354 Investment related losses, net (937) (123) Other revenues 6,515 4,734 --------- -------- Total revenues 658,270 511,580 Benefits and expenses: Claims and other policy benefits 499,974 376,399 Policy acquisition costs and other insurance expenses 75,620 70,230 Other operating expenses 39,495 30,234 -------- -------- Total benefits and expenses 615,089 476,863 Income before income taxes $ 43,181 $ 34,717 ======== ======== - more - Add Sixteen REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Corporate and Other (Dollars in thousands) Three Months Ended (Unaudited) September 30, - -------------------------------------------------------------------- 2007 2006 ---- ---- Revenues: Net premiums $ 1,038 $ 468 Investment income, net of related expenses 26,616 19,167 Investment related gains, net 247 387 Other revenues 1,484 2,673 -------- -------- Total revenues 29,385 22,695 Benefits and expenses: Claims and other policy benefits 189 54 Interest credited -- 77 Policy acquisition costs and other insurance expenses (8,172) (7,432) Other operating expenses 10,610 11,643 Interest expense 9,860 15,103 Collateral finance facilities expense 13,047 13,136 -------- -------- Total benefits and expenses 25,534 32,581 Income/(loss) before income taxes $ 3,851 $ (9,886) ======== ======== Nine Months Ended (Unaudited) September 30, - -------------------------------------------------------------------- 2007 2006 ---- ---- Revenues: Net premiums $ 2,265 $ 1,485 Investment income, net of related expenses 70,847 37,962 Investment related gains/(losses), net (11,568) 3,362 Other revenues 7,084 4,790 -------- -------- Total revenues 68,628 47,599 Benefits and expenses: Claims and other policy benefits 217 (977) Interest credited -- 830 Policy acquisition costs and other insurance expenses (27,395) (26,162) Other operating expenses 34,066 35,044 Interest expense 53,545 46,884 Collateral finance facilities expense 38,940 13,413 -------- -------- Total benefits and expenses 99,373 69,032 Loss before income taxes $(30,745) $(21,433) ======== ======== # # # -----END PRIVACY-ENHANCED MESSAGE-----