Information Provided in Connection with Investments in Deferred Annuity Contracts andSignatureNotes Issued or Assumed by John Hancock Life Insurance Company (U.S.A.) (Tables)

12 Months Ended

Dec. 31, 2017

Text block1 [abstract]

Condensed Consolidated Statement of Financial Position

Condensed Consolidated Statement of Financial Position


As at December 31, 2017	MFC (Guarantor)		JHUSA (Issuer)		Other subsidiaries		Consolidation adjustments			Consolidated MFC
Assets
Invested assets	$	21	$	108,144	$	226,421	$	(364	)	$	334,222
Investments in unconsolidated subsidiaries		48,374		6,509		14,999		(69,882	)		–
Reinsurance assets		–		49,927		8,281		(27,849	)		30,359
Other assets		314		18,678		40,715		(19,062	)		40,645
Segregated funds net assets		–		176,139		149,812		(1,644	)		324,307
Total assets	$	48,709	$	359,397	$	440,228	$	(118,801	)	$	729,533
Liabilities and equity
Insurance contract liabilities	$	–	$	147,155	$	185,884	$	(28,434	)	$	304,605
Investment contract liabilities		–		1,130		1,998		(2	)		3,126
Other liabilities		297		19,399		41,394		(18,930	)		42,160
Long-term debt		4,784		–		1		–			4,785
Capital instruments		2,615		584		5,188		–			8,387
Segregated funds net liabilities		–		176,139		149,812		(1,644	)		324,307
Shareholders’ equity		41,013		14,990		54,801		(69,791	)		41,013
Participating policyholders’ equity		–		–		221		–			221
Non-controlling interests		–		–		929		–			929
Total liabilities and equity	$	48,709	$	359,397	$	440,228	$	(118,801	)	$	729,533
Condensed Consolidated Statement of Financial Position
As at December 31, 2016	MFC (Guarantor)		JHUSA (Issuer)		Other subsidiaries		Consolidation adjustments			Consolidated MFC
Assets
Invested assets	$	161	$	109,063	$	213,043	$	(398	)	$	321,869
Investments in unconsolidated subsidiaries		47,758		6,457		17,504		(71,719	)		–
Reinsurance assets		–		51,537		10,069		(26,654	)		34,952
Other assets		315		28,718		43,931		(24,281	)		48,683
Segregated funds net assets		–		174,917		142,400		(2,140	)		315,177
Total assets	$	48,234	$	370,692	$	426,947	$	(125,192	)	$	720,681
Liabilities and equity
Insurance contract liabilities	$	–	$	147,504	$	177,524	$	(27,523	)	$	297,505
Investment contract liabilities		–		1,251		2,027		(3	)		3,275
Other liabilities		252		28,892		43,994		(24,113	)		49,025
Long-term debt		5,689		–		7		–			5,696
Capital instruments		461		627		6,092		–			7,180
Segregated funds net liabilities		–		174,917		142,400		(2,140	)		315,177
Shareholders’ equity		41,832		17,501		53,912		(71,413	)		41,832
Participating policyholders’ equity		–		–		248		–			248
Non-controlling interests		–		–		743		–			743
Total liabilities and equity	$	48,234	$	370,692	$	426,947	$	(125,192	)	$	720,681

Condensed Consolidated Statement of Income

Condensed Consolidated Statement of Income

For the year ended December 31, 2017

MFC
(Guarantor)

JHUSA
(Issuer)

Other
subsidiaries

Consolidation
adjustments

Consolidated
MFC

Revenue

Net premium income

–

11,084

17,130

)

28,210

Net investment income (loss)

178

7,986

11,947

(744

)

19,367

Net other revenue

2,874

10,912

(3,044

)

10,746

Total revenue

182

21,944

39,989

(3,792

)

58,323

Contract benefits and expenses

Net benefits and claims

–

20,803

19,179

(681

)

39,301

Commissions, investment and general expenses

3,208

13,900

(2,097

)

15,022

Other expenses

404

194

1,915

(1,014

)

1,499

Total contract benefits and expenses

415

24,205

34,994

(3,792

)

55,822

Income (loss) before income taxes

(233

)

(2,261

)

4,995

–

2,501

Income tax (expense) recovery

1,134

(1,435

)

–

(239

)

Income (loss) after income taxes

(171

)

(1,127

)

3,560

–

2,262

Equity in net income (loss) of unconsolidated subsidiaries

2,275

628

(486

)

(2,417

)

–

Net income (loss)

2,104

(499

)

3,074

(2,417

)

2,262

Net income (loss) attributed to:

Non-controlling interests

–

194

–

194

Participating policyholders

–

(10

)

(36

)

(36

)

Shareholders

2,104

(489

)

2,916

(2,427

)

2,104

(499

)

3,074

(2,417

)

2,262

Condensed Consolidated Statement of Income


For the year ended December 31, 2016	MFC (Guarantor)		JHUSA (Issuer)			Other subsidiaries			Consolidation adjustments			Consolidated MFC
Revenue
Net premium income		–		5,021			22,611			–			27,632
Net investment income (loss)		475		6,191			9,092			(1,234	)		14,524
Net other revenue		43		2,569			11,108			(2,539	)		11,181
Total revenue		518		13,781			42,811			(3,773	)		53,337
Contract benefits and expenses
Net benefits and claims		–		10,340			24,748			(954	)		34,134
Commissions, investment and general expenses		11		3,272			13,016			(1,840	)		14,459
Other expenses		259		59			2,076			(979	)		1,415
Total contract benefits and expenses		270		13,671			39,840			(3,773	)		50,008
Income (loss) before income taxes		248		110			2,971			–			3,329
Income tax (expense) recovery		28		251			(475	)		–			(196	)
Income (loss) after income taxes		276		361			2,496			–			3,133
Equity in net income (loss) of unconsolidated subsidiaries		2,653		211			572			(3,436	)		–
Net income (loss)	$	2,929	$	572		$	3,068		$	(3,436	)	$	3,133
Net income (loss) attributed to:
Non-controlling interests	$	–	$	–		$	143		$	–		$	143
Participating policyholders		–		(48	)		61			48			61
Shareholders		2,929		620			2,864			(3,484	)		2,929
	$	2,929	$	572		$	3,068		$	(3,436	)	$	3,133

Consolidated Statement of Cash Flows

Consolidated Statement of Cash Flows

For the year ended December 31, 2017

MFC

(Guarantor)

JHUSA

(Issuer)

Other

subsidiaries

Consolidation

adjustments

Consolidated

MFC

Operating activities

Net income (loss)

2,104

(499

)

3,074

(2,417

)

2,262

Adjustments:

Equity in net income of unconsolidated subsidiaries

(2,275

)

(628

)

486

2,417

–

Increase (decrease) in insurance contract liabilities

–

16,877

3,146

–

20,023

Increase (decrease) in investment contract liabilities

–

118

–

173

(Increase) decrease in reinsurance assets

–

(1,890

)

4,159

–

2,269

Amortization of (premium) discount on invested assets

–

206

–

230

Other amortization

123

433

–

560

Net realized and unrealized (gains) losses and impairment on assets

)

(2,609

)

(4,572

)

–

(7,188

)

Deferred income tax expense (recovery)

(59

)

(2,239

)

1,967

–

(331

)

Stock option expense

–

)

–

Cash provided by (used in) operating activities before undernoted items

(233

)

9,210

9,036

–

18,013

Dividends from unconsolidated subsidiary

2,700

125

1,175

(4,000

)

–

Changes in policy related and operating receivables and payables

(45

)

(4,627

)

4,450

–

(222

)

Cash provided by (used in) operating activities

2,422

4,708

14,661

(4,000

)

17,791

Investing activities

Purchases and mortgage advances

–

(30,645

)

(56,579

)

–

(87,224

)

Disposals and repayments

–

26,952

43,768

–

70,720

Changes in investment broker net receivables and payables

–

182

–

227

Investment in common shares of subsidiaries

(2,473

)

–

2,473

–

Net cash decrease from sale and purchase of subsidiaries and businesses

–

(10

)

–

(10

)

Capital contribution to unconsolidated subsidiaries

–

(63

)

–

Return of capital from unconsolidated subsidiaries

–

(11

)

–

Notes receivable from affiliates

–

201

(201

)

–

Notes receivable from parent

–

368

(392

)

–

Notes receivable from subsidiaries

(16

)

(10

)

–

Cash provided by (used in) investing activities

(2,489

)

(3,205

)

(12,551

)

1,958

(16,287

)

Financing activities

Increase (decrease) in repurchase agreements and securities sold but not yet purchased

–

(29

)

–

(29

)

Redemption of long-term debt

(600

)

–

)

–

(607

)

Issue of capital instruments, net

2,209

–

2,209

Redemption of capital instruments

–

(899

)

–

(899

)

Secured borrowings from securitization transactions

–

741

–

741

Changes in deposits from Bank clients, net

–

261

–

261

Shareholders’ dividends paid in cash

(1,780

)

–

(1,780

)

Dividends paid to parent

–

(1,175

)

(2,825

)

4,000

–

Contributions from (distributions to) non-controlling interests, net

–

)

–

)

Common shares issued, net

124

–

2,473

(2,473

)

124

Capital contributions by parent

–

(63

)

–

Return of capital to parent

–

(11

)

–

Notes payable to affiliates

–

(201

)

–

201

–

Notes payable to parent

–

(26

)

–

Notes payable to subsidiaries

(24

)

–

(368

)

392

–

Cash provided by (used in) financing activities

(71

)

(1,376

)

(581

)

2,042

Cash and short-term securities

Increase (decrease) during the year

(138

)

127

1,529

–

1,518

Effect of foreign exchange rate changes on cash and short-term securities

)

(276

)

(380

)

–

(658

)

Balance, beginning of year

161

3,787

10,290

–

14,238

Balance, end of year

3,638

11,439

–

15,098

Cash and short-term securities

Beginning of year

Gross cash and short-term securities

161

4,317

10,673

–

15,151

Net payments in transit, included in other liabilities

–

(530

)

(383

)

–

(913

)

Net cash and short-term securities, beginning of year

161

3,787

10,290

–

14,238

End of year

Gross cash and short-term securities

4,133

11,811

–

15,965

Net payments in transit, included in other liabilities

–

(495

)

(372

)

–

(867

)

Net cash and short-term securities, end of year

3,638

11,439

–

15,098

Supplemental disclosures on cash flow information:

Interest received

273

4,391

6,504

(572

)

10,596

Interest paid

392

1,202

(572

)

1,118

Income taxes paid

1,084

177

–

1,360

Consolidated Statement of Cash Flows


For the year ended December 31, 2016	MFC (Guarantor)			JHUSA (Issuer)			Other subsidiaries			Consolidation adjustments			Consolidated MFC
Operating activities
Net income (loss)	$	2,929		$	572		$	3,068		$	(3,436	)	$	3,133
Adjustments:
Equity in net income of unconsolidated subsidiaries		(2,653	)		(211	)		(572	)		3,436			–
Increase (decrease) in insurance contract liabilities		–			5,225			12,789			–			18,014
Increase (decrease) in investment contract liabilities		–			58			(58	)		–			–
(Increase) decrease in reinsurance assets		–			(1,444	)		602			–			(842	)
Amortization of (premium) discount on invested assets		–			(5	)		83			–			78
Other amortization		2			284			407			–			693
Net realized and unrealized (gains) losses and impairment on assets		(9	)		(917	)		(1,878	)		–			(2,804	)
Deferred income tax expense (recovery)		3			391			(629	)		–			(235	)
Stock option expense		–			(1	)		20			–			19
Cash provided by (used in) operating activities before undernoted items		272			3,952			13,832			–			18,056
Dividends from unconsolidated subsidiary		1,950			111			–			(2,061	)		–
Changes in policy related and operating receivables and payables		171			(1,291	)		81			–			(1,039	)
Cash provided by (used in) operating activities		2,393			2,772			13,913			(2,061	)		17,017
Investing activities
Purchases and mortgage advances		(32	)		(34,656	)		(69,371	)		–			(104,059	)
Disposals and repayments		–			32,343			49,658			–			82,001
Changes in investment broker net receivables and payables		–			(35	)		(151	)		–			(186	)
Investment in common shares of subsidiaries		(5,706	)		–			–			5,706			–
Net cash decrease from sale and purchase of subsidiaries and businesses		–			–			(495	)		–			(495	)
Capital contribution to unconsolidated subsidiaries		–			(350	)		–			350			–
Return of capital from unconsolidated subsidiaries		–			1			–			(1	)		–
Notes receivable from affiliates		–			–			544			(544	)		–
Notes receivable from parent		–			–			344			(344	)		–
Notes receivable from subsidiaries		(6	)		(40	)		–			46			–
Cash provided by (used in) investing activities		(5,744	)		(2,737	)		(19,471	)		5,213			(22,739	)
Financing activities
(Decrease) increase in repurchase agreements and securities sold but not yet purchased		–			–			(23	)		–			(23	)
Issue of long-term debt, net		3,899			–			–			–			3,899
Redemption of long-term debt		–			–			(158	)		–			(158	)
Issue of capital instruments, net		479			–			–			–			479
Redemption of capital instruments		–			–			(949	)		–			(949	)
Secured borrowings from securitization transactions		–			–			847			–			847
Changes in deposits from Bank clients, net		–			–			(157	)		–			(157	)
Shareholders’ dividends paid in cash		(1,593	)		–			–			–			(1,593	)
Contributions from (distributions to) non-controlling interests, net		–			–			10			–			10
Common shares issued, net		66			–			5,706			(5,706	)		66
Preferred shares issued, net		884			–			–			–			884
Dividends paid to parent		–			–			(2,061	)		2,061			–
Capital contributions by parent		–			–			350			(350	)		–
Return of capital to parent		–			–			(1	)		1			–
Notes payable to affiliates		–			(544	)		–			544			–
Notes payable to parent		–			–			46			(46	)		–
Notes payable to subsidiaries		(344	)		–			–			344			–
Cash provided by (used in) financing activities		3,391			(544	)		3,610			(3,152	)		3,305
Cash and short-term securities
Increase (decrease) during the year		40			(509	)		(1,948	)		–			(2,417	)
Effect of foreign exchange rate changes on cash and short-term securities		(1	)		(149	)		(197	)		–			(347	)
Balance, beginning of year		122			4,445			12,435			–			17,002
Balance, end of year		161			3,787			10,290			–			14,238
Cash and short-term securities
Beginning of year
Gross cash and short-term securities		122			4,938			12,825			–			17,885
Net payments in transit, included in other liabilities		–			(493	)		(390	)		–			(883	)
Net cash and short-term securities, beginning of year		122			4,445			12,435			–			17,002
End of year
Gross cash and short-term securities		161			4,317			10,673			–			15,151
Net payments in transit, included in other liabilities		–			(530	)		(383	)		–			(913	)
Net cash and short-term securities, end of year	$	161		$	3,787		$	10,290		$	–		$	14,238
Supplemental disclosures on cash flow information:
Interest received	$	–		$	4,523		$	6,795		$	(768	)	$	10,550
Interest paid		210			144			1,397			(768	)		983
Income taxes paid		35			68			738			–			841