Canada Life Financial Corp. said Tuesday that the drop in global equity markets will have an impact on the companies third quarter earnings. Third quarter net earnings are expected to be 56¢ per share excluding the impact of the previously announced provision of $15 million after tax for the events of September 11, compared with net earnings of 62¢ per share for the same quarter last year.

The impact of global equity markets, which have been falling throughout the year, is expected to reduce earnings for the third quarter by $45 million or 28¢ per share compared with the same quarter last year.

Strong business growth continued in the quarter. Total premiums and deposits for the quarter are expected to be $2,674 million, an increase of 20% from the same period last year, while at the same time, growth in expenses has been minimal. Total assets under administration are expected to be $62,494 million at September 30, an increase of 7% from last year.

Canada Life will announce its third quarter results on November 7.

Canada Life also announced that during the fourth quarter of 2001, the Company is adopting new valuation practices as required by the Canadian Institute of Actuaries. As a result, the company’s year-end financial statements will reflect a restatement of the first nine months of 2001 and all of 2000 in accordance with the new practices

The effect of the restatement is expected to require a prior period adjustment increasing liabilities and reducing 2000 year-end shareholders’ equity by an amount between $150 million and $250 million.

Earnings for 2001 are expected to be higher than would have been reported under the current valuation practices.
Canada Life expects that return on equity for 2001 will be at the bottom end of the target range of 13-14%, before the impact of the events of September 11.