Genworth Financial Announces Second Quarter 2014 Results

           Genworth Financial Announces Second Quarter 2014 Results

Strong Loss Performance In Global Mortgage Insurance Division

Adverse Long Term Care Insurance Claims Experience

$514 Million Net Proceeds From Australia Mortgage Insurance IPO

PR Newswire

RICHMOND, Va., July 29, 2014

RICHMOND, Va., July 29, 2014 /PRNewswire/ -- Genworth Financial, Inc. (NYSE:
GNW) today reported results for the second quarter of 2014. The company
reported net income^1 of $176 million, or $0.35 per diluted share, compared
with net income of $141 million, or $0.28 per diluted share, in the second
quarter of 2013. Net operating income^2 for the second quarter of 2014 was
$158 million, or $0.31 per diluted share, compared with net operating income
of $133 million, or $0.27 per diluted share, in the second quarter of 2013.

On May 21, 2014, the company completed the minority initial public offering
(IPO) of 33.8 percent of its Australia mortgage insurance (MI) business and as
a result net income attributable to noncontrolling interests in the Australia
MI business^2 was $11 million in the current quarter. Net income before net
income attributable to noncontrolling interests in the Australia MI business^2
was $187 million, or $0.37 per diluted share, in the second quarter of 2014
compared with net income available to Genworth's common stockholders of $141
million, or $0.28 per diluted share, in the second quarter of 2013. Net
operating income before net operating income attributable to noncontrolling
interests in the Australia MI business^2 for the second quarter of 2014 was
$169 million, or $0.34 per diluted share, compared with net operating income
of $133 million, or $0.27 per diluted share, in the second quarter of 2013.

"Genworth made continued progress in our turnaround strategy during the
quarter with the completion of the partial IPO of our Australia MI business,"
said Tom McInerney, President and CEO. "Our second quarter 2014 results were
strong in our mortgage insurance businesses, which benefitted from continued
solid loss performance, but disappointing in our long term care insurance
business, where we experienced adverse claims development. We continue to
pursue state approvals for premium rate increases in long term care and
recently launched a new long term care insurance product in 42 states that
balances flexibility for customers with appropriate risk-adjusted returns for
Genworth." 

Consolidated Net Income &
Net Operating Income
                                   Three months ended June 30
                                   (Unaudited)
                                   2014              2013
                                            Per               Per
                                            diluted           diluted  Total %
(Amounts in millions, except per   Total    share    Total    share    change
share)
Net income available to
Genworth's common
  stockholders                     $ 176    $  0.35  $ 141    $  0.28  25   %
Adjustment: Net income
attributable to
  noncontrolling interests in        11        0.02    N/A       N/A   N/A
  Australia MI
Net income available to
Genworth's common
  stockholders before net income
  attributable
  to noncontrolling interests in   $ 187    $  0.37  $ 141    $  0.28  33   %
  Australia MI
Net operating income               $ 158    $  0.31  $ 133    $  0.27  19   %
Adjustment: Net operating income
attributable to
  noncontrolling interests in        11        0.02    N/A       N/A   N/A
  Australia MI
Net operating income before net
operating
  income attributable to
  noncontrolling interests
  in Australia MI                  $ 169    $  0.34  $ 133    $  0.27  27   %
Weighted average diluted shares      503.6             497.5
Book value per share               $ 32.68           $ 29.76
Book value per share, excluding
accumulated
  other comprehensive income       $ 24.31           $ 23.39
  (loss)

Net investment gains, net of taxes and other adjustments, were $20 million in
the quarter, compared to $15 million in the prior year. Total investment
impairments, net of taxes, were $1 million in the current quarter and $4
million in the prior year.

Net operating income results are summarized in the table below:

Net Operating Income (Loss)
(Amounts in millions)                          Q2 14   Q1 14   Q2 13
U.S. Life Insurance Division:
 U.S. Life Insurance                       $ 69     $ 94    $ 79
 Total U.S. Life Insurance Division          69       94      79
Global Mortgage Insurance Division:
 International Mortgage Insurance            97^3    99      89
 U.S. Mortgage Insurance (U.S. MI)           39       33      13
 Total Global Mortgage Insurance Division    136      132     102
Corporate and Other Division:
  International Protection                    2        7       1
 Runoff                                      15       12      6
 Corporate and Other                         (64)     (51)    (55)
Total Corporate and Other Division               (47)     (32)    (48)
Total Net Operating Income                     $ 158    $ 194   $ 133

Net operating income excludes net investment gains (losses), goodwill
impairments, gains (losses) on the sale of businesses, restructuring charges,
gains (losses) on the early extinguishment of debt, gains (losses) on
insurance block transactions and other adjustments, net of taxes. A
reconciliation of net operating income of segments and Corporate and Other
activities to net income is included at the end of this press release.

Unless specifically noted in the discussion of results for the International
Mortgage Insurance and International Protection segments, references to
percentage changes exclude the impact of translating foreign denominated
activity into U.S. dollars (foreign exchange). Percentage changes, which
include the impact of foreign exchange, are found in a table at the end of
this press release. The impact of foreign exchange on net operating income in
the second quarter of 2014 was a favorable impact of $1 million versus the
prior quarter and an unfavorable impact of $11 million versus the prior year.

U.S. Life Insurance Division

U.S. Life Insurance Division net operating income was $69 million, compared
with $94 million in the prior quarter and $79 million a year ago.

U.S. Life Insurance Division
Net Operating Income
(Amounts in millions)      Q2 14  Q1 14  Q2 13
U.S. Life Insurance
 Life Insurance            $  39  $  21  $  27
 Long Term Care Insurance     6      46     26
 Fixed Annuities              24     27     26
Total U.S. Life Insurance     69     94     79
Total U.S. Life Insurance  $  69  $  94  $  79



Sales
(Amounts in millions)      Q2 14  Q1 14  Q2 13
U.S. Life Insurance
 Life Insurance
    Term Life              $ 14   $ 13   $ 4
    Term Universal Life      —      —      —
    Universal Life           7      6      5
    Linked Benefits          5      2      3
 Long Term Care Insurance
    Individual               24     21     38
    Group                    2      1      5
 Fixed Annuities             429    520    212



Account Value
(Amounts in millions)  Q2 14     Q1 14     Q2 13
Fixed Annuities        $ 19,209  $ 19,037  $ 17,949

U.S. Life Insurance Division

Key Points

  oU.S. Life Insurance Division net operating income was $69 million,
    compared with $94 million in the prior quarter and $79 million a year
    ago.
  oCompared to the prior quarter, sales of life insurance and individual long
    term care insurance (LTC) products were higher but lower in fixed
    annuities.
  oThe consolidated risk-based capital (RBC) ratio is estimated to be
    approximately 490 percent^4, up from 480 percent at the end of the first
    quarter of 2014.
  oAs of June 30, 2014, 43 states have approved premium rate increases as
    part of the 2012 in force premium rate increases. The company continues
    toexpect to achieve $250 to $300 million of premium increases when fully
    implemented.
  oIn September 2013, the company announced that it began filing for LTC
    premium rate increases on certain Privileged Choice® and Classic Select®
    policies sold between 2003 and 2012.As of June 30, 2014, 18 states have
    approved these rate increases.

Life Insurance

Life insurance net operating income was $39 million, compared with $21 million
in the prior quarter and $27 million in the prior year. Mortality experience
improved versus the prior quarter. Results compared to the prior year
benefitted from slower reserve growth resulting from a correction to reserves
and unlocking of mortality and interest assumptions which were completed in
the third quarter of 2013. In addition, investment spread and mortality
improved modestly versus the prior year.

Sales of $26 million increased versus the prior quarter and prior year. The
company is transitioning to a broader set of competitive permanent product
offerings, including indexed universal life and linked benefit products, and
growth in sales on these products is expected to continue through the
remainder of 2014. Linked benefit product deposits were $42 million in the
quarter, up from $25 million in the prior quarter and in the prior year.

Long Term Care Insurance

Long term care insurance net operating income was $6 million, compared with
$46 million in the prior quarter and $26 million in the prior year. Results
benefitted from premium increases and reduced benefits of $3 million versus
the prior quarter and $34 million versus the prior year related to the premium
increases approved and implemented to date. Benefits and other changes in
policy reserves increased $46 million after-tax versus the prior quarter and
$47 million after-tax versus the prior year. Excluding the impact from the
premium increases approved and implemented to date, benefits and other changes
in policy reserves^2 increased $45 million after-tax versus the prior quarter
primarily from higher incurred losses resulting from higher severity on new
and existing claims and increased $66 million after-tax versus the prior year
primarily from higher severity and frequency on new and existing claims. As a
result of recentexperience, and in connection with its regular review of
claims reserve assumptions for its long term care insurance products, the
company is conducting a comprehensive review of the adequacy of its claim
reserves. The company intends to complete this review before the release of
financial results for the third quarter of 2014. The company continues to
believe that the existing assumptions and methodology provide the most
reliable best estimate. However, given the review underway, that will consider
both long-term and recent experience, the company will likely change some of
its assumptions, which could increase its long term care insurance claim
reserves, and any increase may or may not be material.

Individual LTC sales of $24 million were higher than the prior quarter and
lower than the prior year. The company is continuing to invest in distribution
and marketing to increase LTC sales over time and expects to begin seeing some
impact from these actions during the second half of the year. The company
launched its Privileged Choice Flex 3.0 product in July 2014 in 42 states
which gives millions more Americans the flexibility to choose the right fit
for their long term care needs, combined with the simplicity of prepackaged
benefits.

Fixed Annuities

Fixed annuities net operating income was $24 million, compared with $27
million in the prior quarter and $26 million in the prior year. Results
compared to the prior quarter and prior year included unfavorable mortality
that was partially offset by a favorable adjustment related to guarantee
funds. Investment income from bond calls was down versus prior year, but was
partially offset by the net impact of higher assets under management versus
the prior year. Sales in the quarter totaled $429 million, down sequentially
impacted by the decline in interest rates during the current quarter.

U.S. Life Companies Capital

The consolidated risk-based capital (RBC) ratio is estimated to be
approximately 490 percent^4, up from 480 percent at the end of the first
quarter of 2014 and the consolidated U.S. life insurance companies unassigned
surplus is estimated to be approximately $560 million^4, up from approximately
$440 million at the end of the first quarter of 2014. During the quarter, the
company completed a life insurance reinsurance transaction generating
approximately $90 million of unassigned surplus.

Global Mortgage Insurance Division

Global Mortgage Insurance Division had net operating income of $136 million,
compared with net operating income of $132 million in the prior quarter and
$102 million a year ago.

Global Mortgage Insurance Division
Net Operating Income (Loss)
(Amounts in millions)                   Q2 14   Q1 14  Q2 13
International Mortgage Insurance
 Canada                             $ 47     $ 41   $ 43
 Australia                            57^3    62     55
 Other Countries                      (7)      (4)    (9)
Total International Mortgage Insurance    97       99     89
U.S. Mortgage Insurance                   39       33     13
Total Global Mortgage Insurance         $ 136    $ 132  $ 102



Sales
(Amounts in billions)             Q2 14  Q1 14  Q2 13
International Mortgage Insurance
 Flow
 Canada                  $ 5.0  $ 2.9  $ 4.7
 Australia                 7.9    7.8    8.7
 Other Countries           0.5    0.4    0.4
 Bulk
 Canada                    7.5    2.9    6.4
 Australia                 —      —      0.9
 Other Countries           —      —      —
U.S. Mortgage Insurance
 Primary Flow                   6.1    3.9    6.3
 Primary Bulk                   —      —      —

International Mortgage Insurance Segment

Key Points

  oReported International Mortgage Insurance segment net operating income was
    $97 million, compared with $99 million in the prior quarter and $89
    million a year ago. Results in the quarter reflected an $11 million
    decrease in net operating income versus the prior quarter and prior year
    as a result of the IPO of 33.8 percent of the Australia MI business which
    was completed on May 21, 2014. Foreign exchange had an unfavorable impact
    of $11 million versus the prior year. The loss ratio in Canada was 12
    percent and the loss ratio in Australia was 23 percent for the quarter.
  oIn Canada, flow new insurance written (NIW) was up 72 percent^5
    sequentially and up 13 percent^5 year over year. In addition, in the
    current quarter, the company completed $7.5 billion of bulk transactions,
    consisting of low loan-to-value prime loans. In Australia, flow NIW was
    down three percent^5 sequentially and flat^5 year over year.
  oThe Canadian and Australian businesses continue to maintain sound capital
    positions.
  oDividends of $42 million were paid to the holding company through the
    first half of 2014.

Canada Mortgage Insurance

Canada reported net operating income of $47 million versus $41 million in the
prior quarter and $43 million in the prior year. The loss ratio in the quarter
was 12 percent, down eight points from the prior quarter from seasonally lower
new delinquencies, net of cures, and down 13 points from the prior year
reflecting the strong credit quality of recent books and the overall stable
economic environment. Earnings were impacted by unfavorable foreign exchange
of $4 million versus the prior year. Results included more favorable tax
benefits versus the prior quarter and prior year. Flow NIW was up 72
percent^5sequentially primarily from normal seasonal variation and the impact
of the severe winter season in the first quarter of 2014 and up 13 percent^5
year over year from increased market penetration. In addition, the company
completed several bulk transactions in the quarter, consisting of low
loan-to-value prime loans, of approximately $7.5 billion reflecting its
selective participation in this market. After consultations with the
business's regulator, The Office of the Superintendent of Financial
Institutions (OSFI), the business established its operating holding target at
220 percent minimum capital test (MCT), pending the development of a new
regulatory capital test for mortgage insurers. At quarter end, the Canada
mortgage insurance business had a MCT ratio of 230 percent^4, in excess of the
targeted level.

Australia Mortgage Insurance

Australia reported net operating income of $57 million versus $62 million in
the prior quarter and $55 million in the prior year. Results in the quarter
reflected an $11 million decrease in net operating income versus the prior
quarter and prior year as a result of the IPO of 33.8 percent of the Australia
MI business, which was completed on May 21, 2014. The loss ratio in the
quarter was 23 percent, up six points sequentially from seasonally higher new
delinquencies and lower cure rates as home prices moderated during the quarter
and down 12 points from the prior year primarily from favorable aging of later
stage delinquencies. Earnings were impacted by more favorable tax benefits of
$11 million compared to the prior quarter and $9 million compared to the prior
year as a result of the IPO. Results compared to the prior year included
unfavorable foreign exchange of $6 million. Results in the current quarter
also included $3 million of currency transaction losses on intercompany loans.
Flow NIW was down three percent^5 sequentially and flat^5 year over year. At
quarter end, the Australia mortgage insurance business had a prescribed
capital amount (PCA) ratio of 154 percent^4, in excess of the targeted range.

Other Countries Mortgage Insurance

Other Countries had a net operating loss of $7 million, compared to net
operating losses of $4 million in the prior quarter and $9 million in the
prior year as the business experienced higher losses in the current quarter.

U.S. Mortgage Insurance Segment

Key Points

  oU.S. MI net operating income was $39 million, compared with $33 million in
    the prior quarter and $13 million in the prior year. Results in the prior
    quarter included $6 million of unfavorable tax adjustments. The loss ratio
    in the quarter was 43 percent.
  oFlow NIW increased 56 percent from the prior quarter and decreased three
    percent from the prior year to $6.1 billion.
  oThe risk-to-capital ratio for Genworth Mortgage Insurance Corporation
    (GMICO) is estimated at 14.0:1^4 and the combined risk-to-capital ratio is
    estimated at 14.6:1^4 as of June 30, 2014, reflecting a contribution to
    GMICO in the quarter of $300 million that was being held at Genworth
    Mortgage Holdings, LLC.

Total flow delinquencies decreased six percent sequentially and 26 percent
versus the prior year. New flow delinquencies decreased approximately 13
percent from the prior quarter and decreased approximately 19 percent from the
prior year, reflecting the continued burn through of delinquencies from the
2005 to 2008 book years. The flow average reserve per delinquency was $30,000,
down slightly from the prior quarter.

Total losses were in line with the prior quarter as lower new delinquency
development was offset by less favorable net cures and aging of existing
delinquencies. Loss development within the quarter was in line with the modest
loss reserve strengthening completed in the first quarter of 2014.Loss
mitigation savings were $102 million in the quarter, down $12 million from the
prior quarter.

Flow NIW of $6.1 billion increased 56 percent from the prior quarter
reflecting normal seasonal variation in the purchase market and the impact of
the severe winter season in the first quarter of 2014 and decreased three
percent versus the prior year primarily from a smaller refinance origination
market. Overall private mortgage insurance market penetration was up one point
compared with the prior quarter and up approximately four points year over
year as the originations market shifted from refinances to a purchase market.
The company's estimate of market share at the end of the quarter is
approximately 14 percent. Flow persistency was 83 percent. In addition, the
Home Affordable Refinance Program (HARP) accounted for about $0.4 billion in
the quarter of insurance that is treated as a modification of the coverage on
existing insurance in force rather than NIW, bringing the total risk-in-force
under the HARP program to $4.9 billion.

The combined U.S. MI statutory risk-to-capital ratio is estimated at 14.6:1^4
at the end of the second quarter with the risk-to-capital ratio for GMICO
estimated at 14.0:1^4, reflecting a contribution to GMICO in the quarter of
$300 million that was being held at Genworth Mortgage Holdings, LLC.

On July 10, 2014, the draft Private Mortgage Insurance Eligibility
Requirements were released by the government sponsored enterprises (GSEs). The
company intends to meet the additional capital requirements for U.S. MI set
forthin the draft guidelineson or before the anticipated effective date of
June 30, 2015, depending on the availability of the capital and reinsurance
markets andthe performance of its businessesand subject to noother
unforeseen developments. The company will utilize the two-year transition
period as approved by the Federal Housing Finance Administration (FHFA) and
GSEs if it does not comply by the anticipated effective date. The company and
its U.S. MI business are confident that they are well-positioned to meet the
draft version of these guidelines within the prescribed transition period and
fully expect the U.S. MI business to maintain its strong presence in the
private mortgage insurance market.

Based on the company's current views of the housing market, expected U.S. MI
earnings and capital generation, anticipated prepayment of its in-force
portfolio in the ordinary course, the amount and loan characteristics of new
U.S. MI business anticipated to be written and the $300 million contributed to
GMICO in the second quarter of 2014, the company's preliminary estimate of the
additional capital required to be fully compliant assuming an effective date
of June 30, 2015 will be between $450 to $550 million and will decrease to
less than $175 million by December 31, 2016. The company has a variety of
capital resources that could be utilized to satisfy capital requirements, and
initially intends to utilize reinsurance transactions, and if needed, cash
available at the holding company, which includes the proceeds from the
completed Australian IPO, to fund them. Other potential sources include, but
are not limited to, continued earnings from the business, available deferred
tax assets and proceeds from the issuance of securities at Genworth Financial
or Genworth Holdings. After the guidelines become final, the company will
provide more details around its plans to comply with the Private Mortgage
Insurance Eligibility Requirements including sources and timing of invested
capital.

Corporate and Other Division

Corporate and Other Division net operating loss was $47 million, compared with
$32 million in the prior quarter and $48 million in the prior year.

Corporate and Other Division
Net Operating Income (Loss)
(Amounts in millions)                                Q2 14    Q1 14    Q2 13
International Protection                             $ 2      $ 7      $ 1
Runoff                                                 15       12       6
Corporate and Other                                    (64)     (51)     (55)
Total Corporate and Other                            $ (47)   $ (32)   $ (48)
Account Value
(Amounts in millions)                                Q2 14    Q1 14    Q2 13
Variable Annuities                                   $ 7,884  $ 7,901  $ 7,877
Guaranteed Investment Contracts, Funding Agreements
         Backing Notes and Funding Agreements          667      891      1,077



International Protection Segment

International Protection reported operating income of $2 million, compared
with $7 million in the prior quarter and $1 million in the prior year. Results
in the prior quarter included $4 million of favorable tax adjustments. At
quarter end, the lifestyle protection business had a regulatory capital ratio
of approximately 348 percent^4, well in excess of regulatory requirements.

Runoff Segment

The Runoff segment's net operating income was $15 million, compared with $12
million in the prior quarter and $6 million in the prior year. Results in the
current quarter reflected higher equity market growth versus the prior quarter
and prior year primarily impacting the variable annuity business.

Corporate and Other

Corporate and Other's net operating loss was $64 million, compared with $51
million in the prior quarter and $55 million in the prior year. Results in the
prior quarter reflected $17 million of favorable tax adjustments.

Investment Portfolio Performance

Net investment income increased to $813 million, compared to $805 million in
the prior quarter primarily from a favorable impact from prepayment speeds on
structured securities. The reported yield for the current quarter was
approximately 4.63 percent. The core yield^2 was up slightly compared to the
prior quarter at approximately 4.45 percent.

Net income in the quarter included $20 million of net investment gains, net of
taxes, deferred acquisition costs amortization and other items. Total
investment impairments, net of taxes, were $1 million in the current quarter
and $4 million in the prior year.

Net unrealized investment gains were $2.1 billion, net of taxes and other
items, as of June 30, 2014 compared with $1.3 billion as of June 30, 2013 and
$1.6 billion as of March 31, 2014. The fixed maturity securities portfolio had
gross unrealized investment gains of $5.2 billion compared with $4.0 billion
as of June 30, 2013 and gross unrealized investment losses of $0.3 billion
compared with $0.9 billion as of June 30, 2013.

Holding Company

Genworth's holding company^6 ended the quarter with approximately $1.2
billion^7 of cash and liquid assets, down approximately $45 million compared
to the prior quarter, from $485 million of debt maturities, $90 million of
debt interest payments, partially offset by approximately $500 million of net
proceeds from the minority IPO of Australia MI received in the quarter, $21
million of dividends received from the operating companies and $9 million of
net other items. The holding company targets maintaining cash balances of at
least one and a half times its annual debt service expense plus a risk buffer
of $350 million.

About Genworth Financial

Genworth Financial, Inc. (NYSE: GNW) is a leading Fortune 500 insurance
holding company committed to helping families become more financially secure,
self-reliant and prepared for the future. Genworth has leadership positions in
long term care insurance and mortgage insurance and competitive offerings in
life insurance and fixed annuities that assist consumers in solving their
insurance, retirement and home ownership needs.

Genworth operates through three divisions: U.S. Life Insurance, which includes
life insurance, long term care insurance and fixed annuities; Global Mortgage
Insurance, containing U.S. Mortgage Insurance and International Mortgage
Insurance segments; and the Corporate and Other division, which includes the
International Protection and Runoff segments. Products and services are
offered through financial intermediaries, advisors, independent distributors
and sales specialists. Genworth, headquartered in Richmond, Virginia, traces
its roots back to 1871 and became a public company in 2004. For more
information, visit genworth.com. From time to time, Genworth releases
important information via postings on its corporate website. Accordingly,
investors and other interested parties are encouraged to enroll to receive
automatic email alerts and Really Simple Syndication (RSS) feeds regarding new
postings. Enrollment information is found under the "Investors" section of
genworth.com. From time to time, Genworth's publicly traded subsidiaries,
Genworth MI Canada Inc. (TSX:MIC) and Genworth Mortgage Insurance Australia
Limited (ASX:GMA), separately release financial and other information about
their operations. This information can be found at http://www.genworth.com.au
and http://genworth.ca.

Conference Call and Financial Supplement Information

This press release, second quarter 2014 financial supplement and earnings
presentation are now posted on the company's website. Additional information
regarding business results will be posted on the company's website,
http://investor.genworth.com, by 7:30 a.m. on July 30, 2014. Investors are
encouraged to review these materials.

Genworth will conduct a conference call on July 30, 2014 at 8:00 a.m. (ET) to
discuss the quarter's results and provide a progress update on the company's
strategic priorities. The conference call will be accessible via telephone and
the Internet. The dial-in number for the conference call is 877 888.4034 or
913 489.5101 (outside the U.S.); conference ID # 7690205. To participate in
the call by webcast, register at http://investor.genworth.com at least 15
minutes prior to the webcast to download and install any necessary software.

Replays of the call will be available through August 14, 2014 at 888 203.1112
or 719 457.0820 (outside the U.S.); conference ID # 7690205. The webcast will
also be archived on the company's website.

Use of Non-GAAP Measures

This press release includes the non-GAAP financial measures entitled "net
operating income (loss)" and "operating earnings per share." Operating
earnings per share is derived from net operating income (loss). The chief
operating decision maker evaluates segment performance and allocates resources
on the basis of net operating income (loss). The company defines net operating
income (loss) as income (loss) from continuing operations excluding the
after-tax effects of income attributable to noncontrolling interests, net
investment gains (losses), goodwill impairments, gains (losses) on the sale of
businesses, gains (losses) on the early extinguishment of debt, gains (losses)
on insurance block transactions and infrequent or unusual non-operating items.
Gains (losses) on insurance block transactions are defined as gains (losses)
on the early extinguishment of non-recourse funding obligations, early
termination fees for other financing restructuring and/or resulting gains
(losses) on reinsurance restructuring for certain blocks of business. The
company excludes net investment gains (losses) and infrequent or unusual
non-operating items because the company does not consider them to be related
to the operating performance of the company's segments and Corporate and Other
activities. A component of the company's net investment gains (losses) is the
result of impairments, the size and timing of which can vary significantly
depending on market credit cycles. In addition, the size and timing of other
investment gains (losses) can be subject to the company's discretion and are
influenced by market opportunities, as well as asset-liability matching
considerations. Goodwill impairments, gains (losses) on the sale of
businesses, gains (losses) on the early extinguishment of debt and gains
(losses) on insurance block transactions are also excluded from net operating
income (loss) because, in the company's opinion, they are not indicative of
overall operating trends. Other non-operating items are also excluded from net
operating income (loss) if, in the company's opinion, they are not indicative
of overall operating trends.

The following transaction was excluded from net operating income (loss) for
the periods presented as it related to the loss on the early extinguishment of
debt. In the second quarter of 2014, the company paid an early redemption
payment of approximately $2 million, net of taxes and portion attributable to
noncontrolling interests, related to the early redemption of Genworth MI
Canada Inc.'s notes that were scheduled to mature in 2015.

There were no infrequent or unusual items excluded from net operating income
(loss) during the periods presented other than a $13 million, net of taxes,
expense recorded in the second quarter of 2013 related to restructuring costs.

While some of these items may be significant components of net income (loss)
available to Genworth'scommon stockholders in accordance with GAAP, the
company believes that net operating income (loss) and measures that are
derived from or incorporate net operating income (loss), including net
operating income (loss) per common share on a basic and diluted basis, are
appropriate measures that are useful to investors because they identify the
income (loss) attributable to the ongoing operations of the business.
Management also uses net operating income (loss) as a basis for determining
awards and compensation for senior management and to evaluate performance on a
basis comparable to that used by analysts. However, the items excluded from
net operating income (loss) have occurred in the past and could, and in some
cases will, recur in the future. Net operating income (loss) and net operating
income (loss) per common share on a basic and diluted basis are not
substitutes for net income (loss) available to Genworth's common stockholders
or net income (loss) available to Genworth's common stockholders per common
share on a basic and diluted basis determined in accordance with GAAP. In
addition, the company's definition of net operating income (loss) may differ
from the definitions used by other companies.

The tables at the end of this press release reflect net operating income
(loss) as determined in accordance with accounting guidance related to segment
reporting, and a reconciliation of net operating income (loss) of the
company's segments and Corporate and Other activities to net income available
to Genworth's common stockholders for the three months ended June 30, 2014 and
2013, as well as for the three months ended March 31, 2014.

Adjustments to reconcile net income attributable to Genworth's common
stockholders and net operating income assume a 35 percent tax rate and are net
of the portion attributable to noncontrolling interests. Net investment gains
(losses) are also adjusted for deferred acquisition costs and other intangible
amortization and certain benefit reserves.

This press release also includes non-GAAP financial measures entitled "net
income before net income attributable to noncontrolling interests in the
Australia MI business" and "net operating income before net operating income
attributable to noncontrolling interests in the Australia MI business." The
company defines net income before net income attributable to noncontrolling
interests in the Australia MI business and net operating income before net
operating income attributable to noncontrolling interests in the Australia MI
business as net income or net operating income, as applicable, adjusted for
net income attributable to noncontrolling interests in the Australia MI
business but before noncontrolling interests in the Canada MI business. These
measures are presented as they are comparable to net income and net operating
income for the second quarter of 2013. However, net income before net income
attributable to noncontrolling interests in the Australia MI business and net
operating income before net operating income attributable to noncontrolling
interests in the Australia MIbusiness are notsubstitutes for net incomeand
net operating income determined in accordance with GAAP. A reconciliation of
net income before net income attributable to noncontrolling interests in the
Australia MI business and net operating income before net operating income
attributable to noncontrolling interests in the Australia MI business to net
income and net operating income is included in a table at the end of this
press release.

This press release includes a non-GAAP financial measure that excludes the
impact from premium increases approved and implemented to date, net of
taxes,from benefits and other changes in policy reserves, net of taxes, for
the long term care insurance business. Management believes that analysis of
benefits and other changes in policy reserves excluding the impact from the
premium increases approved and implemented to date, net of taxes,enhances
understanding of the underlying claims experience in the current period.
However, benefits and other changes in policy reserves excluding the impact
from the premium increases approved and implemented to date, net of taxes,is
not a substitute for GAAP benefits and other changes in policy reserves, net
of taxes, determined in accordance with GAAP. A reconciliation of benefits and
other changes in policy reserves excluding the impact from the premium
increases approved and implemented to date, net of taxes,to reported GAAP
benefits and other changes in policy reserves, net of taxes,is included in a
table at the end of this press release.

This press release includes the non-GAAP financial measure entitled "core
yield" as a measure of investment yield. The company defines core yield as the
investment yield adjusted for those items that are not recurring in nature.
Management believes that analysis of core yield enhances understanding of the
investment yield of the company. However, core yieldis nota substitute for
investment yield determined in accordance with GAAP. In addition, the
company's definition of core yield may differ from the definitions used by
other companies. A reconciliation of core yield to reported GAAP yield is
included in a table at the end of this press release.

Definition of Selected Operating Performance Measures

The company reports selected operating performance measures including "sales"
and "insurance in force" or "risk in force" which are commonly used in the
insurance industry as measures of operating performance.

Management regularly monitors and reports sales metrics as a measure of volume
of new and renewal business generated in a period. Sales refer to: (1)
annualized first-year premiums for term life and long term care insurance
products; (2) annualized first-year deposits plus five percent of excess
deposits for universal and term universal life insurance products; (3) 10
percent of premium deposits for linked-benefits products; (4) new and
additional premiums/deposits for fixed annuities; (5) new insurance written
for mortgage insurance; and (6) net premiums written for the lifestyle
protection insurance business. Sales do not include renewal premiums on
policies or contracts written during prior periods. The company considers
annualized first-year premiums/deposits, premium equivalents, new
premiums/deposits, new insurance written, and net premiums written to be a
measure of the company's operating performance because they represent a
measure of new sales of insurance policies or contracts during a specified
period, rather than a measure of the company's revenues or profitability
during that period.

Management regularly monitors and reports insurance in force and risk in
force. Insurance in force for the life, international mortgage and U.S.
mortgage insurance businesses is a measure of the aggregate face value of
outstanding insurance policies as of the respective reporting date. For risk
in force in the international mortgage insurance business, the company has
computed an "effective" risk in force amount, which recognizes that the loss
on any particular loan will be reduced by the net proceeds received upon sale
of the property. Effective risk in force has been calculated by applying to
insurance in force a factor of 35 percent that represents the highest expected
average per-claim payment for any one underwriting year over the life of the
company's businesses in Canada and Australia. Risk in force for the U.S.
mortgage insurance business is the obligation that is limited under
contractual terms to the amounts less than 100 percent of the mortgage loan
value.The company considers insurance in force and risk in force to be
measures of the company's operating performance because they represent
measures of the size of the business at a specific date which will generate
revenues and profits in a future period, rather than measures of the company's
revenues or profitability during that period.

This press release also includes information related to loss mitigation
activities for the U.S. mortgage insurance business. The company defines loss
mitigation activities as rescissions, cancellations, borrower loan
modifications, repayment plans, lender- and borrower-titled presales, claims
administration and other loan workouts. Estimated savings related to
rescissions are the reduction in carried loss reserves, net of premium refunds
and reinstatement of prior rescissions. Estimated savings related to loan
modifications and other cure related loss mitigation actions represent the
reduction in carried loss reserves. Estimated savings related to claims
mitigation activities represent amounts deducted or "curtailed" from claims
due to acts or omissions by the insured or the servicer with respect to the
servicing of an insured loan that is not in compliance with obligations under
the company's master policy. For non-cure related actions, including presales,
the estimated savings represent the difference between the full claim
obligation and the actual amount paid. Loans subject to the company's loss
mitigation actions, the results of which have been included in the company's
reported estimated loss mitigation savings, are subject to re-default and may
result in a potential claim in future periods, as well as potential future
loss mitigation savings depending on the resolution of the re-defaulted loan.
The company believes that this information helps to enhance the understanding
of the operating performance of the U.S. mortgage insurance business as loss
mitigation activities specifically impact current and future loss reserves and
level of claim payments.

Management also regularly monitors and reports a loss ratio for the company's
businesses. For the long term care insurance business, the loss ratio is the
ratio of benefits and other changes in reserves less tabular interest on
reserves less loss adjustment expenses to net earned premiums. For the
mortgage and lifestyle protection insurance businesses, the loss ratio is the
ratio of incurred losses and loss adjustment expenses to net earned premiums.
The company considers the loss ratio to be a measure of underwriting
performance in these businesses and helps to enhance the understanding of the
operating performance of the businesses.

An assumed tax rate of 35 percent is utilized in the explanation of specific
variances of operating performance and investment results.

These operating performance measures enable the company to compare its
operating performance across periods without regard to revenues or
profitability related to policies or contracts sold in prior periods or from
investments or other sources.

Cautionary Note Regarding Forward-Looking Statements

This press release contains certain "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements may be identified by words such as "expects,"
"intends," "anticipates," "plans," "believes," "seeks," "estimates," "will" or
words of similar meaning and include, but are not limited to, statements
regarding the outlook for the company's future business and financial
performance. Forward-looking statements are based on management's current
expectations and assumptions, which are subject to inherent uncertainties,
risks and changes in circumstances that are difficult to predict. Actual
outcomes and results may differ materially due to global political, economic,
business, competitive, market, regulatory and other factors and risks,
including, but not limited to, the following:

  oRisks relating to the company's businesses, including downturns and
    volatility in global economies and equity and credit markets; downgrades
    or potential downgrades in the company's financial strength or credit
    ratings; interest rate fluctuations and levels; adverse capital and credit
    market conditions; the valuation of fixed maturity, equity and trading
    securities; defaults or other events impacting the value of the company's
    fixed maturity securities portfolio; defaults on the company's commercial
    mortgage loans or the mortgage loans underlying the company's investments
    in commercial mortgage-backed securities and volatility in performance;
    availability, affordability and adequacy of reinsurance; defaults by
    counterparties to reinsurance arrangements or derivative instruments; an
    adverse change in risk-based capital and other regulatory requirements;
    insufficiency of reserves and required increases to reserve liabilities;
    legal and regulatory constraints on dividend distributions by the
    company's subsidiaries; competition, including from government-owned and
    government-sponsored enterprises (GSEs) offering mortgage insurance; loss
    of key distribution partners; regulatory restrictions on the company's
    operations and changes in applicable laws and regulations; legal or
    regulatory investigations or actions; the failure of or any compromise of
    the security of the company's computer systems and confidential
    information contained therein; the occurrence of natural or man-made
    disasters or a pandemic; the effect of the Dodd-Frank Wall Street Reform
    and Consumer Protection Act; ineffective or inadequate risk management
    program; changes in accounting and reporting standards; goodwill
    impairments; impairments of or valuation allowances against the company's
    deferred tax assets; significant deviations from the company's assumptions
    in its insurance policies and annuity contracts; accelerated amortization
    of deferred acquisition costs and present value of future profits; ability
    to increase premiums on in force and future long term care insurance
    products, including any current rate actions and any future rate actions;
    the failure of demand for life insurance, long term care insurance and
    fixed annuity products to increase; medical advances, such as genetic
    research and diagnostic imaging, and related legislation; ability to
    continue to implement actions to mitigate the impact of statutory reserve
    requirements; political and economic instability or changes in government
    policies; fluctuations in foreign currency exchange rates and
    international securities markets; the significant portion of the company's
    international mortgage insurance risk in force with high loan-to-value
    ratios; increases in U.S. mortgage insurance default rates; failure to
    meet, or have waived to the extent needed, the company's U.S. mortgage
    insurance subsidiaries' minimum statutory capital requirements and
    hazardous financial condition standards; the influence of Federal National
    Mortgage Association (Fannie Mae), Federal Home Loan Mortgage Corporation
    (Freddie Mac) and a small number of large mortgage lenders and investors
    and changes to the role or structure of Fannie Mae and Freddie Mac;
    failure to meet the revised GSE eligibility standards or the capital
    required to meet the revised standards may be higher than anticipated;
    ability to realize the benefits of the company's rescissions and
    curtailments; the extent to which loan modifications and other similar
    programs may provide benefits to the company; deterioration in economic
    conditions or a decline in home prices in the United States; problems
    associated with foreclosure process defects in the United States that may
    defer claim payments; decreases in the volume of high loan-to-value
    mortgage originations or increases in mortgage insurance cancellations in
    the United States; increases in the use of alternatives to private
    mortgage insurance in the United States and reductions by lenders in the
    level of coverage they select; the impact of the use of reinsurance with
    reinsurance companies affiliated with the company's U.S. mortgage lending
    customers; and potential liabilities in connection with the company's U.S.
    contract underwriting services;
  oOther risks, including the risk that the anticipated benefits of the
    announced expense reduction are not realized and the company may lose key
    personnel related to actions like this as well as general uncertainty in
    the timing of the company's turnaround; the possibility that in certain
    circumstances the company will be obligated to make payments to General
    Electric Company (GE) under the tax matters agreement with GE even if the
    company's corresponding tax savings are never realized and payments could
    be accelerated in the event of certain changes in control; and provisions
    of the company's certificate of incorporation and bylaws and the tax
    matters agreement with GE may discourage takeover attempts and business
    combinations that stockholders might consider in their best interests; and
  oRisks relating to the company's common stock, including the suspension of
    dividends and stock price fluctuations.

The company undertakes no obligation to publicly update any forward-looking
statement, whether as a result of new information, future developments or
otherwise.



Condensed Consolidated Statements of Income
(Amounts in millions, except per share amounts)
                                                           Three months ended
                                                           June 30,
                                                           2014       2013
Revenues:
Premiums                                                   $  1,343   $ 1,286
Net investment income                                         813       821
Net investment gains (losses)                                 34        21
Insurance and investment product fees and other               225       243
 Total revenues                                      2,415     2,371
Benefits and expenses:
Benefits and other changes in policy reserves                 1,256     1,269
Interest credited                                             184       184
Acquisition and operating expenses, net of
 deferrals                                                404       413
Amortization of deferred acquisition costs and
 intangibles                                              138       137
Interest expense                                              120       121
 Total benefits and expenses                         2,102     2,124
Income from continuing operations before income taxes         313       247
Provision for income taxes                                    85        73
Income from continuing operations                             228       174
Income from discontinued operations, net of taxes             —         6
Net income                                                    228       180
Less: net income attributable to noncontrolling interests     52        39
Net income available to Genworth Financial, Inc.'s
 common stockholders                                   $  176     $ 141
Income from continuing operations available to
 Genworth Financial, Inc.'s common stockholders
 per common share:
 Basic                                            $  0.35    $ 0.27
 Diluted                                          $  0.35    $ 0.27
Net income available to Genworth Financial, Inc.'s
 common stockholders per common share:
Basic                                            $  0.35    $ 0.29
 Diluted                                          $  0.35    $ 0.28
Weighted-average shares outstanding:
  Basic                                               496.6     493.4
 Diluted                                             503.6     497.5



Reconciliation of Net Operating Income to Net Income
(Amounts in millions, except per share amounts)
                                                Three             Three
                                                months ended      months ended
                                                June 30,          March 31,
                                                2014     2013     2014
Net operating income (loss):
U.S. Life Insurance Division
 U.S. Life Insurance segment
Life Insurance                        $ 39     $ 27     $    21
 Long Term Care                          6        26          46
 Fixed Annuities                         24       26          27
 Total U.S. Life Insurance segment            69       79          94
 Total U.S. Life Insurance Division           69       79          94
Global Mortgage Insurance Division
 International Mortgage Insurance segment
 Canada                                  47       43          41
 Australia                               57^3    55          62
 Other Countries                         (7)      (9)         (4)
 Total International Mortgage Insurance       97       89          99
segment
 U.S. Mortgage Insurance segment              39       13          33
 Total Global Mortgage Insurance Division     136      102         132
Corporate and Other Division
 International Protection segment             2        1           7
 Runoff segment                               15       6           12
 Corporate and Other                          (64)     (55)        (51)
 Total Corporate and Other Division           (47)     (48)        (32)
Net operating income                              158      133         194
Adjustments to net operating income:
Net investment gains (losses), net                20       15          (10)
Expenses related to restructuring, net            —        (13)        —
Gains (losses) on early extinguishment of         (2)      —           —
debt, net
Income from discontinued operations, net of       —        6           —
taxes
Net income available to Genworth Financial,
Inc.'s
 common stockholders                          176      141         184
Add: net income attributable to noncontrolling    52       39          35
interests
Net income                                      $ 228    $ 180    $    219
Net income available to Genworth Financial,
Inc.'s
 common stockholders per common share:
 Basic                                 $ 0.35   $ 0.29   $    0.37
 Diluted                               $ 0.35   $ 0.28   $    0.37
Net operating income per common share:
 Basic                                 $ 0.32   $ 0.27   $    0.39
 Diluted                               $ 0.31   $ 0.27   $    0.39
Weighted-average shares outstanding:
 Basic                                   496.6    493.4       495.8
 Diluted                                 503.6    497.5       502.7



Condensed Consolidated Balance Sheets
(Amounts in millions)
                                                       June 30,   December 31,
                                                       2014       2013
Assets
 Cash, cash equivalents and invested assets            $ 77,544   $   73,505
 Deferred acquisition costs                              5,085        5,278
 Intangible assets                                       266          399
 Goodwill                                                867          867
 Reinsurance recoverable                                 17,276       17,219
 Other assets                                            695          639
 Separate account assets                                 9,911        10,138
      Total assets                                     $ 111,644  $   108,045
Liabilities and stockholders' equity
 Liabilities:
  Future policy benefits                               $ 34,497   $   33,705
  Policyholder account balances                          25,834       25,528
  Liability for policy and contract claims               7,223        7,204
  Unearned premiums                                      4,191        4,107
  Deferred tax and other liabilities                     4,776        4,302
  Borrowings related to securitization entities          233          242
  Non-recourse funding obligations                       2,024        2,038
  Long-term borrowings                                   4,691        5,161
  Separate account liabilities                           9,911        10,138
      Total liabilities                                  93,380       92,425
 Stockholders' equity:
  Common stock                                           1            1
  Additional paid-in capital                             11,986       12,127
  Accumulated other comprehensive income (loss):
      Net unrealized investment gains (losses):
         Net unrealized gains (losses) on securities
         not
                 other-than-temporarily impaired         2,109        914
         Net unrealized gains (losses) on other-than-
                 temporarily impaired securities         19           12
      Net unrealized investment gains (losses)           2,128        926
      Derivatives qualifying as hedges                   1,652        1,319
      Foreign currency translation and other             381          297
      adjustments
  Total accumulated other comprehensive income (loss)    4,161        2,542
  Retained earnings                                      2,783        2,423
  Treasury stock, at cost                                (2,700)      (2,700)
      Total Genworth Financial, Inc.'s stockholders'     16,231       14,393
      equity
  Noncontrolling interests                               2,033        1,227
      Total stockholders' equity                         18,264       15,620
      Total liabilities and stockholders' equity       $ 111,644  $   108,045



Reconciliation of Long Term Care Insurance Benefits And Other Changes In
Policy Reserves
(Amounts in millions)
                                              Three
                            Three             months     Change from  Change
                                                                      from
                            months ended      ended     June 30,     June 30,
                                                         2014         2014
                            June 30,          March 31,  to June      to March
                            2014     2013     2014       30, 2013     31, 2014
Benefits and other changes  $ 735    $ 663    $  664     $    72      $  71
in policy reserves
Adjustments for:
 Impact from the
premium increases approved
and
 implemented to      44       14        46           30         (2)
date
 Taxes                    (273)    (237)     (249)        (36)       (24)
Benefits and other changes
in policy reserves
excluding
 the impact from the
premium increases approved
and
 implemented to date,   $ 506    $ 440    $  461     $    66      $  45
net



Impact of Foreign Exchange on Operating Results^8
Three months ended June 30, 2014
                                       Percentages         Percentages
                                       Including Foreign   Excluding Foreign
                                       Exchange            Exchange^9
 Canada Mortgage Insurance (MI):
 Flow new insurance written                 6      %       13         %
 Flow new insurance written (2Q14 vs.       72     %       72         %
 1Q14)
 Australia MI:
 Flow new insurance written                 (9)    %        ―       %
 Flow new insurance written (2Q14 vs.       1      %       (3)        %
 1Q14)



Reconciliation of Net Investment Gains (Losses)
(Amounts in millions)
                                                   Three          Three
                                                   months ended   months ended
                                                   June 30,       March 31,
                                                   2014    2013   2014
Net investment gains (losses), gross               $ 34    $ 21   $    (17)
Adjustments for:
 Deferred acquisition costs and other
intangible amortization and certain
 benefit reserves                           3       7         1
 Net investment gains (losses) attributable      (5)     (5)       1
to noncontrolling interests
 Taxes                                           (12)    (8)       5
Net investment gains (losses), net                 $ 20    $ 15   $    (10)



Reconciliation of Net Income Before Net Income Attributable To Noncontrolling
Interests In The Australia MI Business To Net Income Available To Genworth's
Common Stockholders And Net Operating Income Before Net Operating Income
Attributable
To Noncontrolling Interests In The Australia MI Business To Net Operating
Income
(Amounts in millions)
                                                                  Three
                                                                  months ended
                                                                  June 30,
                                                                  2014   2013
Net income before net income attributable to noncontrolling       $ 228  $ 180
interests
Adjustments for:
 Net income attributable to noncontrolling interests in the     11     N/A
Australia MI business
 Net income attributable to noncontrolling interests in the     41     39
Canada MI business
Net income available to Genworth's common stockholders            $ 176  $ 141
Net operating income before net operating income attributable to  $ 208  $ 169
noncontrolling interests
Adjustments for:
 Net operating income attributable to noncontrolling            11     N/A
interests in the Australia MI business
 Net operating income attributable to noncontrolling            39     36
interests in the Canada MI business
Net operating income                                              $ 158  $ 133



Reconciliation of Core Yield to Reported Yield
                                                                                                                  For the
                                                                                                                  three
                                                                                                                  months
                                                                                                                  ended
                                                                                                                  June 30,
 (Assets - amounts in billions)                                                                                   2014
 Reported Total Invested Assets and Cash                                                                          $ 76.9
 Subtract:
  Securities lending                                                                                            0.3
  Unrealized gains (losses)                                                                                     5.6
  Derivative counterparty collateral                                                                            0.4
 Adjusted end of period invested assets                                                                           $ 70.6
 Average Invested Assets Used in Reported Yield Calculation                                                       $ 70.2
 Subtract:
  Restricted commercial mortgage loans and other invested assets related to
  securitization entities^10                                                                               0.2
 Average Invested Assets Used in Core Yield Calculation                                                           $ 70.0
 (Income - amounts in
 millions)
 Reported Net Investment Income                                                                                   $ 813
 Subtract:
  Bond calls and commercial mortgage loan prepayments                                                           7
  Reinsurance^11                                                                                                13
  Other non-core items^12                                                                                       12
  Restricted commercial mortgage loans and other invested assets related to
  securitization entities^10                                                                               3
 Core Net Investment Income                                                                                       $ 778
 Reported Yield                                                                                                     4.63 %
 Core Yield                                                                                                         4.45 %



^1 Unless otherwise stated, all references in this press release to net
income, net income per share, book value, book value per share and
stockholders' equity should be read as net income available to Genworth's
common stockholders, net income available to Genworth's common stockholders
per share, book value available to Genworth's common stockholders, book value
available to Genworth's common stockholders per share and stockholders' equity
available to Genworth's common stockholders, respectively.
^2 This is a financial measure not calculated based on U.S. Generally Accepted
Accounting Principles (Non-GAAP). See the Use of Non-GAAP Measures section of
this press release for additional information.
^3 Excluding net income attributable to noncontrolling interests in the
Australia MI business of $11 million in the second quarter of 2014, related to
the Australia MI IPO completed on May 21, 2014.
^4 Company estimate for the second quarter of 2014, due to timing of the
filing of statutory statements.
^5 Percent change excludes the impact of foreign exchange.
^6 Holding company cash and liquid assets comprises assets held in Genworth
Holdings, Inc. (the issuer of outstanding public company debt) which is a
subsidiary of Genworth Financial, Inc.
^7 Comprises cash and cash equivalents of $1,073 million and U.S. government
bonds of $150 million.
^8 All percentages are comparing the second quarter of 2014 to the second
quarter of 2013 unless otherwise stated.
^9 The impact of foreign exchange was calculated using the comparable prior
period exchange rates.
^10 Represents the incremental assets and investment income related to
restricted commercial mortgage loans and other invested assets.
^11 Represents imputed investment income related to reinsurance agreements in
the lifestyle protection insurance business.
^12 Includes cost basis adjustments on structured securities, preferred stock
income and various other immaterial items.

SOURCE Genworth Financial, Inc.

Website: http://www.genworth.com
Contact: Investors: Amy Corbin, 804 662.2685, amy.corbin@genworth.com, or
Media: Al Orendorff, 804 662.2534, alfred.orendorff@genworth.com
 
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