By Andrea Hopkins
TORONTO (Reuters) - Profit rose 17 percent at Industrial Alliance Insurance and Financial Services
The company said on Wednesday that net income was C$60.1 million ($56.7 million), or 74 Canadian cents a share, in the three months ended September 30. That was up from C$51.2 million, or 63 Canadian cents a share, in the same 2008 period.
The result beat the average analyst profit estimate of 65 Canadian cents a share, according to Thomson Reuters I/B/E/S.
Industrial Alliance shares were up 1.0 percent at C$29.62 on the Toronto Stock Exchange on Wednesday morning, while the S&P/TSX financial index of banks, insurance companies and asset managers was also up 1.0 percent.
Profit was boosted by a C$1.1 million gain as the difference between the market value of the company's debt instruments and that of underlying assets changed in the company's favor.
The profit was also affected by a C$1.2 million after-tax shortfall due to lower sales in the creditor insurance sector.
Industrial Alliance said it did not post any credit losses during the quarter and did not have to strengthen its provisions for future policy benefits.
"Our strict management during the crisis and the general improvement in market conditions are paying off," Chief Executive Yvon Charest said in a statement.
"Assets reached a new high. Sales growth has resumed in the retail sectors and even jumped considerably in the individual insurance sector."
The balance sheet at the Quebec City-based company was boosted by a C$100 million preferred share issue.
"The leeway that we've developed in the last year to absorb significant potential market downturns remains very good," Charest said.
As expected, the dividend was unchanged at 24.5 Canadian cents per common share, and Industrial Alliance reiterated that the dividend should be maintained through 2009.
Premiums and deposits fell 9 percent to C$1.2 billion in the third quarter, due entirely to weakness in the group pensions sector. Premiums and deposits are either stable or increasing in all other sectors, the company said.
"The decrease in the group pensions sector is due to the fact that the company was not able to sign any large contracts during the quarter, contrary to last year, when the signing of a few large contracts allowed the sector to end the quarter with sales among the highest in its history," the company said.
Industrial Alliance is the first of Canada's four big life insurers to report third-quarter earnings. Manulife Financial Corp
($1=$1.06 Canadian)
(Reporting by Andrea Hopkins; editing by Peter Galloway)
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