Reinsurance Group of America, Incorporated

Please stand by, we're about to begin. Good day and welcome to the Reinsurance Group of America fourth quarter 2021 results conference call. Today's call is being recorded. At this time, I would like to introduce Mr. Todd Larson, Senior Executive Vice President and Chief Financial Officer, and Ms. Anna Manning, President and Chief Executive Officer. Please go ahead, Mr. Larson.

Thank you. Good morning and welcome to RGA's fourth quarter 2021 conference call. With me this morning on the call is Anna Manning, RGA's president and chief executive officer, Leslie Barbee, chief investment officer, Jonathan Porter, chief risk officer, and Jeff Hobson, head of investor relations. We will discuss the fourth quarter results after a quick reminder about forward-looking information and non-GAAP financial measures. Following our prepared remarks, we'll be happy to take your questions. Some of our comments or answers to your questions may contain forward-looking statements. Actual results could differ materially from expected results. Please refer to the earnings release we issued yesterday for a list of important factors that could cause actual results to differ materially from expected results. Additionally, during the course of this call, Information we provide may include non-GAAP financial measures. Please see our earnings release, earnings presentation, quarterly financial supplement, and website for discussion of these terms and reconciliation to GAAP measures. And now, I'd like to turn the call over to Anna for her comments.

Good morning, everyone, and thank you for joining our call today. Last night, we reported a loss of 56 cents in adjusted operating EPS, which included COVID-19 costs of $350 million pre-tax or $3.95 per share. This quarter is a story of continued strong underlying performance, active capital management, and favorable business momentum while absorbing a meaningful level of COVID-19 claim costs. In the quarter, COVID-19 claims were material in the U.S. and South Africa, while we had more moderate claim levels in other countries. Jonathan will provide further insights on our global COVID-19 claims shortly. Turning to some notable performance highlights for the quarter, our global financial solutions business delivered very strong earnings across all lines and regions. And for the full year, the GFS business had a record year for profits. I'm very proud of the work the teams have done to continue to build this business to generate a growing stream of high quality earnings. Our US individual health business performed well continuing a recent trend. Our Asia traditional business also had a record profit in the quarter as underwriting results were favorable and COVID-19 impacts were very modest. The Australia traditional business reported a small profit We are cautiously optimistic about ongoing market developments in Australia as pricing levels, terms and conditions, and general industry dynamics are showing progress towards more sustainable levels. We were again successful this quarter, deploying $106 million of capital into a number of enforced block transactions, including several notable longevity deals in Europe. This brought the full-year capital deployment into transactions, to a total of $543 million, the highest level of annual deployments in our history. Also notably, the 2021 transactions were broad-based across all our regions, the US, EMEA, and Asia, and across a range of products. We start the new year with an active transactions pipeline. Organic new business activity was very good this quarter, building on a good third quarter and continuing our positive momentum. As we discussed at our investor day in December, we see favorable dynamics for insurance products in many of our traditional markets and strong demand from clients for our reinsurance solutions. Investment results were favorable in the quarter despite the continued challenges of the low market yields. Impairments were minimal, and we realized some nice gains from our real estate joint ventures and limited partnerships. And in addition to deploying capital to support organic new business and enforce block transactions, we also repurchased $50 million in shares in the quarter, bringing the total for the year to $96 million. These highlights from this quarter demonstrate the continued resilience of our people, our business, and our balance sheets. And as we shared during our investor day, we see many reasons to be optimistic about the future. First, although uncertainty remains, there are signs that infection levels from the Omicron variant are declining in many places. And as such, we would expect to see deaths decline from their current levels as we move forward. Second, Our value proposition and client partnerships have been strengthened, and we've been adding material long-term earnings through our new business efforts. And finally, the RJA Global platform, combined with the depth of our technical expertise and capabilities and the strength of our client relationships, positions us extremely well to capitalize on the many attractive growth opportunities as we move forward. I continue to be proud of all that we've achieved during these difficult times, and I remain confident and excited about our future. Thank you for your interest in RGA. I hope you all remain safe and stay well. Let me now turn it over to Todd to go over the detailed financial results.