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Information Provided in Connection with Investments in Deferred Annuity Contracts and SignatureNotes Issued or Assumed by John Hancock Life Insurance Company (U.S.A.) | 12 Months Ended
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Dec. 31, 2024
Investments in subsidiaries, joint ventures and associates reported in separate financial statements [abstract] |
Information Provided in Connection with Investments in Deferred Annuity Contracts and SignatureNotes Issued or Assumed by John Hancock Life Insurance Company (U.S.A.) | Information Provided in Connection with Investments in Deferred Annuity Contracts and Signature Notes Issued or Assumed by John Hancock Life Insurance Company (U.S.A.) The following condensed consolidated financial information, presented in accordance with IFRS, and the related disclosure have been included in these Consolidated Financial Statements with respect to JHUSA in compliance with Regulation S-X and Rule 12h-5 of the United States Securities and Exchange Commission (the “Commission”). These financial statements are incorporated by reference in certain of the MFC and its subsidiaries registration statements that are described below and relate to MFC’s guarantee of certain securities to be issued by its subsidiaries. JHUSA maintains a book of deferred annuity contracts that feature a market value adjustment, some of which are registered with the Commission. The deferred annuity contracts may contain variable investment options along with fixed investment period options, or may offer only fixed investment period options. The fixed investment period options enable the participant to invest fixed amounts of money for fixed terms at fixed interest rates, subject to a market value adjustment if the participant desires to terminate a fixed investment period before its maturity date. The annuity contract provides for the market value adjustment to keep the parties whole with respect to the fixed interest bargain for the entire fixed investment period. These fixed investment period options that contain a market value adjustment feature are referred to as “MVAs”. JHUSA has sold medium-term notes to retail investors under its Signature Notes program. Effective December 31, 2009, John Hancock Variable Life Insurance Company (the “Variable Company”) and John Hancock Life Insurance Company (the “Life Company”) merged with and into JHUSA. In connection with the mergers, JHUSA assumed the Variable Company’s rights and obligations with respect to the MVAs issued by the Variable Company and the Life Company’s rights and obligations with respect to the Signature Notes issued by the Life Company. MFC fully and unconditionally guaranteed the payment of JHUSA’s obligations under the MVAs and under the Signature Notes (including the MVAs and Signature Notes assumed by JHUSA in the merger), and such MVAs and the Signature Notes were registered with the Commission. The Signature Notes and MVAs assumed or issued by JHUSA are collectively referred to in this note as the “Guaranteed Securities”. JHUSA is, and each of the Variable Company and the Life Company was, a wholly owned subsidiary of MFC. MFC’s guarantees of the Guaranteed Securities are unsecured obligations of MFC and are subordinated in right of payment to the prior payment in full of all other obligations of MFC, except for other guarantees or obligations of MFC which by their terms are designated as ranking equally in right of payment with or subordinate to MFC’s guarantees of the Guaranteed Securities. The laws of the State of New York govern MFC’s guarantees of the Signature Notes issued or assumed by JHUSA and the laws of the Commonwealth of Massachusetts govern MFC’s guarantees of the MVAs issued or assumed by JHUSA. MFC has consented to the jurisdiction of the courts of New York and Massachusetts. However, because a substantial portion of MFC’s assets is located outside the United States, the assets of MFC located in the United States may not be sufficient to satisfy a judgment given by a federal or state court in the United States to enforce the subordinate guarantees. In general, the federal laws of Canada and the laws of the Province of Ontario, where MFC’s principal executive offices are located, permit an action to be brought in Ontario to enforce such a judgment provided that such judgment is subsisting and unsatisfied for a fixed sum of money and not void or voidable in the United States and a Canadian court will render a judgment against MFC in a certain dollar amount, expressed in Canadian dollars, subject to customary qualifications regarding fraud, violations of public policy, laws limiting the enforcement of creditor’s rights and applicable statutes of limitations on judgments. There is currently no public policy in effect in the Province of Ontario that would support avoiding the recognition and enforcement in Ontario of a judgment of a New York or Massachusetts court on MFC’s guarantees of the Signature Notes issued or assumed by JHUSA or a Massachusetts court on guarantees of the MVAs issued or assumed by JHUSA. MFC is a holding company. MFC’s assets primarily consist of investments in its subsidiaries. MFC’s cash flows primarily consist of dividends and interest payments from its operating subsidiaries, offset by expenses and shareholder dividends and MFC stock repurchases. As a holding company, MFC’s ability to meet its cash requirements, including, but not limited to, paying any amounts due under its guarantees, substantially depends upon dividends from its operating subsidiaries. These subsidiaries are subject to certain regulatory restrictions under laws in Canada, the United States and certain other countries, which may limit their ability to pay dividends or make contributions or loans to MFC. For example, some of MFC’s subsidiaries are subject to restrictions prescribed by the ICA on their ability to declare and pay dividends. The restrictions related to dividends imposed by the ICA are described in note 12. In the United States, insurance laws in Michigan, New York, and Massachusetts, the jurisdictions in which certain of MFC’s U.S. insurance company subsidiaries are domiciled, impose general limitations on the payment of dividends and other upstream distributions or loans by these insurance subsidiaries. These limitations are described in note 12. In Asia, the insurance laws of the jurisdictions in which MFC operates either provide for specific restrictions on the payment of dividends or other distributions or loans by subsidiaries or impose solvency or other financial tests, which could affect the ability of subsidiaries to pay dividends in certain circumstances. There can be no assurance that any current or future regulatory restrictions in Canada, the United States or Asia will not impair MFC’s ability to meet its cash requirements, including, but not limited to, paying any amounts due under its guarantees. The following condensed consolidated financial information, presented in accordance with IFRS, reflects the effects of the mergers and is provided in compliance with Regulation S-X and in accordance with Rule 12h-5 of the Commission. Condensed Consolidated Statement of Financial Position
As at December 31, 2024 | MFC (Guarantor) | JHUSA (Issuer) | Other subsidiaries | Consolidation adjustments | Consolidated MFC
Assets |  |  |  |  |
Invested assets | $126 | $112,444 | $330,044 | $(117) | $442,497
Investments in unconsolidated subsidiaries | 65,350 | 9,393 | 21,510 | (96,253) | -
Insurance contract assets | - | - | 177 | (75) | 102
Reinsurance contract held assets | - | 46,811 | 22,440 | (10,236) | 59,015
Other assets | 548 | 11,182 | 34,660 | (5,174) | 41,216
Segregated funds net assets | - | 218,909 | 218,681 | (1,602) | 435,988
Total assets | $66,024 | $398,739 | $627,512 | $(113,457) | $978,818
Liabilities and equity |  |  |  |  |
Insurance contract liabilities, excluding those for account of segregated fund holders | $- | $148,828 | $258,007 | $(10,434) | $396,401
Reinsurance contract held liabilities | - | - | 2,669 | - | 2,669
Investment contract liabilities | - | 5,260 | 8,854 | (616) | 13,498
Other liabilities | 1,539 | 8,432 | 58,333 | (5,163) | 63,141
Long-term debt | 6,629 | - | - | - | 6,629
Capital instruments | 6,884 | - | 648 | - | 7,532
Insurance contract liabilities for account of segregated fund holders | - | 58,137 | 68,408 | - | 126,545
Investment contract liabilities for account of segregated fund holders | - | 160,772 | 150,273 | (1,602) | 309,443
Shareholders’ and other equity | 50,972 | 17,357 | 78,285 | (95,642) | 50,972
Participating policyholders’ equity | - | (47) | 614 | - | 567
Non-controlling interests | - | - | 1,421 | - | 1,421
Total liabilities and equity | $66,024 | $398,739 | $627,512 | $(113,457) | $978,818
Condensed Consolidated Statement of Financial Position
As at December 31, 2023 | MFC (Guarantor) | JHUSA (Issuer) | Other subsidiaries | Consolidation adjustments | Consolidated MFC
Assets |  |  |  |  |
Invested assets | $86 | $109,433 | $307,930 | $(239) | $417,210
Investments in unconsolidated subsidiaries | 58,694 | 8,674 | 17,916 | (85,284) | -
Insurance contract assets | - | - | 217 | (72) | 145
Reinsurance contract held assets | - | 42,418 | 10,380 | (10,147) | 42,651
Other assets | 329 | 8,731 | 32,700 | (3,736) | 38,024
Segregated funds net assets | - | 188,067 | 191,241 | (1,764) | 377,544
Total assets | $59,109 | $357,323 | $560,384 | $(101,242) | $875,574
Liabilities and equity |  |  |  |  |
Insurance contract liabilities, excluding those for account of segregated fund holders | $- | $145,589 | $232,972 | $(10,565) | $367,996
Reinsurance contract held liabilities | - | - | 2,831 | - | 2,831
Investment contract liabilities | - | 3,487 | 8,928 | (599) | 11,816
Other liabilities | 573 | 5,869 | 51,266 | (3,786) | 53,922
Long-term debt | 6,071 | - | - | - | 6,071
Capital instruments | 5,426 | 594 | 647 | - | 6,667
Insurance contract liabilities for account of segregated fund holders | - | 51,719 | 62,424 | - | 114,143
Investment contract liabilities for account of segregated fund holders | - | 136,348 | 128,817 | (1,764) | 263,401
Shareholders’ and other equity | 47,039 | 13,773 | 70,755 | (84,528) | 47,039
Participating policyholders’ equity | - | (56) | 313 | - | 257
Non-controlling interests | - | - | 1,431 | - | 1,431
Total liabilities and equity | $59,109 | $357,323 | $560,384 | $(101,242) | $875,574
Condensed Consolidated Statement of Income
For the year ended December 31, 2024 | MFC (Guarantor) | JHUSA (Issuer) | Other subsidiaries | Consolidation adjustments | Consolidated MFC
Insurance service result |  |  |  |  |
Insurance revenue | $- | $11,022 | $16,654 | $(1,084) | $26,592
Insurance service expenses | - | (10,501) | (12,384) | 1,063 | (21,822)
Net expenses from reinsurance contracts held | - | (309) | (499) | 39 | (769)
Total insurance service result | - | 212 | 3,771 | 18 | 4,001
Investment result |  |  |  |  |
Net investment income (loss) | 871 | 4,548 | 14,880 | (1,188) | 19,111
Insurance / reinsurance finance income (expenses) | - | (3,894) | (11,022) | (170) | (15,086)
Other investment result | - | (34) | (367) | (103) | (504)
Total investment result | 871 | 620 | 3,491 | (1,461) | 3,521
Other revenue | (34) | 853 | 7,257 | (488) | 7,588
Other expenses | (45) | (1,209) | (5,359) | 274 | (6,339)
Interest expenses | (494) | (19) | (2,825) | 1,657 | (1,681)
Net income (loss) before income taxes | 298 | 457 | 6,335 | - | 7,090
Income tax (expenses) recoveries | (30) | 52 | (1,234) | - | (1,212)
Net income (loss) after income taxes | 268 | 509 | 5,101 | - | 5,878
Equity in net income (loss) of unconsolidated subsidiaries | 5,117 | 550 | 1,059 | (6,726) | -
Net income (loss) | $5,385 | $1,059 | $6,160 | $(6,726) | $5,878
Net income (loss) attributed to: |  |  |  |  |
Non-controlling interests | $- | $- | $247 | $- | $247
Participating policyholders | - | 135 | 246 | (135) | 246
Shareholders and other equity holders | 5,385 | 924 | 5,667 | (6,591) | 5,385
| $5,385 | $1,059 | $6,160 | $(6,726) | $5,878
Condensed Consolidated Statement of Income
For the year ended December 31, 2023 | MFC (Guarantor) | JHUSA (Issuer) | Other subsidiaries | Consolidation adjustments | Consolidated MFC
Insurance service result |  |  |  |  |
Insurance revenue | $- | $9,858 | $15,754 | $(1,640) | $23,972
Insurance service expenses | - | (8,928) | (12,195) | 1,741 | (19,382)
Net expenses from reinsurance contracts held | - | (315) | (175) | (123) | (613)
Total insurance service result | - | 615 | 3,384 | (22) | 3,977
Investment result |  |  |  |  |
Net investment income (loss) | 638 | 4,232 | 14,179 | (1,028) | 18,021
Insurance / reinsurance finance income (expenses) | - | (4,723) | (9,993) | 88 | (14,628)
Other investment result | - | 100 | (432) | (103) | (435)
Total investment result | 638 | (391) | 3,754 | (1,043) | 2,958
Other revenue | 14 | 790 | 6,384 | (442) | 6,746
Other expenses | (55) | (1,112) | (4,776) | 268 | (5,675)
Interest expenses | (433) | (79) | (2,281) | 1,239 | (1,554)
Net income (loss) before income taxes | 164 | (177) | 6,465 | - | 6,452
Income tax (expenses) recoveries | 7 | 175 | (1,027) | - | (845)
Net income (loss) after income taxes | 171 | (2) | 5,438 | - | 5,607
Equity in net income (loss) of unconsolidated subsidiaries | 4,932 | 811 | 809 | (6,552) | -
Net income (loss) | $5,103 | $809 | $6,247 | $(6,552) | $5,607
Net income (loss) attributed to: |  |  |  |  |
Non-controlling interests | $- | $- | $144 | $- | $144
Participating policyholders | - | (74) | 360 | 74 | 360
Shareholders and other equity holders | 5,103 | 883 | 5,743 | (6,626) | 5,103
| $5,103 | $809 | $6,247 | $(6,552) | $5,607
Consolidated Statement of Cash Flows
For the year ended December 31, 2024 | MFC (Guarantor) | JHUSA (Issuer) | Other subsidiaries | Consolidation adjustments | Consolidated MFC
Operating activities |  |  |  |  |
Net income (loss) | $5,385 | $1,059 | $6,160 | $(6,726) | $5,878
Adjustments: |  |  |  |  |
Equity in net income of unconsolidated subsidiaries | (5,117) | (550) | (1,059) | 6,726 | -
Increase (decrease) in insurance contract net liabilities | - | 441 | 8,994 | - | 9,435
Increase (decrease) in investment contract liabilities | - | 70 | 434 | - | 504
(Increase) decrease in reinsurance contract assets, excluding reinsurance transactions | - | (136) | (477) | - | (613)
Amortization of (premium) discount on invested assets | - | 37 | (327) | - | (290)
Contractual service margin (“CSM”) amortization | - | (441) | (1,935) | - | (2,376)
Other amortization | 11 | 147 | 711 | - | 869
Net realized and unrealized (gains) losses and impairment on assets | (38) | 587 | (1,409) | - | (860)
Deferred income tax expenses (recoveries) | 22 | 49 | 240 | - | 311
Net loss on reinsurance transactions (pre-tax) | - | 33 | 38 | - | 71
Cash provided by (used in) operating activities before undernoted items | 263 | 1,296 | 11,370 | - | 12,929
Dividends from unconsolidated subsidiaries | 7,150 | 689 | (595) | (7,244) | -
Changes in policy related and operating receivables and payables | 221 | 1,387 | 11,957 | - | 13,565
Cash provided by (used in) operating activities | 7,634 | 3,372 | 22,732 | (7,244) | 26,494
Investing activities |  |  |  |  |
Purchases and mortgage advances | - | (19,159) | (111,964) | - | (131,123)
Disposals and repayments | - | 16,485 | 96,186 | - | 112,671
Changes in investment broker net receivables and payables | - | (22) | 312 | - | 290
Net cash increase (decrease) from sale (purchase) of subsidiaries | - | - | (297) | - | (297)
Investment in common shares of subsidiaries | (3,432) | - | - | 3,432 | -
Capital contribution to unconsolidated subsidiaries | - | (2) | - | 2 | -
Return of capital from unconsolidated subsidiaries | - | 17 | - | (17) | -
Notes receivable from parent | - | - | (938) | 938 | -
Notes receivable from subsidiaries | (135) | - | - | 135 | -
Cash provided by (used in) investing activities | (3,567) | (2,681) | (16,701) | 4,490 | (18,459)
Financing activities |  |  |  |  |
Change in repurchase agreements and securities sold but not yet purchased | - | - | 460 | - | 460
Issue of capital instruments, net | 2,591 | - | - | - | 2,591
Redemption of capital instruments | (1,277) | (609) | - | - | (1,886)
Secured borrowing from securitization transactions | - | - | 667 | - | 667
Changes in deposits from Bank clients, net | - | - | 413 | - | 413
Lease payments | - | (3) | (115) | - | (118)
Shareholders’ dividends and other equity distributions | (3,159) | - | - | - | (3,159)
Common shares repurchased | (3,272) | - | - | - | (3,272)
Common shares issued, net | 144 | - | 3,432 | (3,432) | 144
Contributions from (distributions to) non-controlling interests, net | - | - | (14) | - | (14)
Dividends paid to parent | - | 595 | (7,839) | 7,244 | -
Capital contributions by parent | - | - | 2 | (2) | -
Return of capital to parent | - | - | (17) | 17 | -
Notes payable to parent | - | - | 135 | (135) | -
Notes payable to subsidiaries | 938 | - | - | (938) | -
Cash provided by (used in) financing activities | (4,035) | (17) | (2,876) | 2,754 | (4,174)
Cash and short-term securities |  |  |  |  |
Increase (decrease) during the year | 32 | 674 | 3,155 | - | 3,861
Effect of foreign exchange rate changes on cash and short-term securities | 8 | 363 | 826 | - | 1,197
Balance, beginning of year | 86 | 4,004 | 15,794 | - | 19,884
Balance, end of year | 126 | 5,041 | 19,775 | - | 24,942
Cash and short-term securities |  |  |  |  |
Beginning of year |  |  |  |  |
Gross cash and short-term securities | 86 | 4,329 | 15,923 | - | 20,338
Net payments in transit, included in other liabilities | - | (325) | (129) | - | (454)
Net cash and short-term securities, beginning of year | 86 | 4,004 | 15,794 | - | 19,884
End of year |  |  |  |  |
Gross cash and short-term securities | 126 | 5,436 | 20,227 | - | 25,789
Net payments in transit, included in other liabilities | - | (395) | (452) | - | (847)
Net cash and short-term securities, end of year | $126 | $5,041 | $19,775 | $- | $24,942
Supplemental disclosures on cash flow information: |  |  |  |  |
Interest received | $831 | $3,872 | $10,582 | $(1,789) | $13,496
Interest paid | 475 | 69 | 2,819 | (1,789) | 1,574
Income taxes paid (refund) | 8 | 1 | 746 | - | 755
Consolidated Statement of Cash Flows
For the year ended December 31, 2023 | MFC (Guarantor) | JHUSA (Issuer) | Other subsidiaries | Consolidation adjustments | Consolidated MFC
Operating activities |  |  |  |  |
Net income (loss) | $5,103 | $809 | $6,247 | $(6,552) | $5,607
Adjustments: |  |  |  |  |
Equity in net income of unconsolidated subsidiaries | (4,932) | (811) | (809) | 6,552 | -
Increase (decrease) in insurance contract net liabilities | - | 455 | 10,242 | - | 10,697
Increase (decrease) in investment contract liabilities | - | (112) | 547 | - | 435
(Increase) decrease in reinsurance contract assets, excluding reinsurance transactions | - | 28 | 946 | - | 974
Amortization of (premium) discount on invested assets | - | 30 | (171) | - | (141)
Contractual service margin (“CSM”) amortization | - | (455) | (1,543) | - | (1,998)
Other amortization | 10 | 147 | 424 | - | 581
Net realized and unrealized (gains) losses and impairment on assets | 3 | 471 | (3,319) | - | (2,845)
Deferred income tax expenses (recoveries) | (11) | (141) | 622 | - | 470
Stock option expense | - | (3) | 5 | - | 2
Cash provided by (used in) operating activities before undernoted items | 173 | 418 | 13,191 | - | 13,782
Dividends from unconsolidated subsidiaries | 5,600 | 386 | (679) | (5,307) | -
Changes in policy related and operating receivables and payables | (4) | (649) | 7,294 | - | 6,641
Cash provided by (used in) operating activities | 5,769 | 155 | 19,806 | (5,307) | 20,423
Investing activities |  |  |  |  |
Purchases and mortgage advances | - | (15,165) | (68,856) | - | (84,021)
Disposals and repayments | - | 16,159 | 54,122 | - | 70,281
Changes in investment broker net receivables and payables | - | 12 | 9 | - | 21
Net cash increase (decrease) from sale (purchase) of subsidiaries | - | - | (1) | - | (1)
Investment in common shares of subsidiaries | (1,843) | - | - | 1,843 | -
Capital contribution to unconsolidated subsidiaries | - | (1) | - | 1 | -
Return of capital from unconsolidated subsidiaries | - | 5 | - | (5) | -
Notes receivable from parent | - | - | (4) | 4 | -
Notes receivable from subsidiaries | (25) | - | - | 25 | -
Cash provided by (used in) investing activities | (1,868) | 1,010 | (14,730) | 1,868 | (13,720)
Financing activities |  |  |  |  |
Change in repurchase agreements and securities sold but not yet purchased | - | - | (693) | - | (693)
Issue of capital instruments, net | 1,194 | - | - | - | 1,194
Redemption of capital instruments | (600) | - | - | - | (600)
Secured borrowing from securitization transactions | - | - | 537 | - | 537
Changes in deposits from Bank clients, net | - | - | (895) | - | (895)
Lease payments | - | (3) | (95) | - | (98)
Shareholders’ dividends and other equity distributions | (2,972) | - | - | - | (2,972)
Common shares repurchased | (1,595) | - | - | - | (1,595)
Common shares issued, net | 94 | - | 1,843 | (1,843) | 94
Contributions from (distributions to) non-controlling interests, net | - | - | (14) | - | (14)
Dividends paid to parent | - | 679 | (5,986) | 5,307 | -
Capital contributions by parent | - | - | 1 | (1) | -
Return of capital to parent | - | - | (5) | 5 | -
Notes payable to parent | - | - | 25 | (25) | -
Notes payable to subsidiaries | 4 | - | - | (4) | -
Cash provided by (used in) financing activities | (3,875) | 676 | (5,282) | 3,439 | (5,042)
Cash and short-term securities |  |  |  |  |
Increase (decrease) during the year | 26 | 1,841 | (206) | - | 1,661
Effect of foreign exchange rate changes on cash and short-term securities | (3) | (52) | (357) | - | (412)
Balance, beginning of year | 63 | 2,215 | 16,357 | - | 18,635
Balance, end of year | 86 | 4,004 | 15,794 | - | 19,884
Cash and short-term securities |  |  |  |  |
Beginning of year |  |  |  |  |
Gross cash and short-term securities | 63 | 2,614 | 16,476 | - | 19,153
Net payments in transit, included in other liabilities | - | (399) | (119) | - | (518)
Net cash and short-term securities, beginning of year | 63 | 2,215 | 16,357 | - | 18,635
End of year |  |  |  |  |
Gross cash and short-term securities | 86 | 4,329 | 15,923 | - | 20,338
Net payments in transit, included in other liabilities | - | (325) | (129) | - | (454)
Net cash and short-term securities, end of year | $86 | $4,004 | $15,794 | $- | $19,884
Supplemental disclosures on cash flow information: |  |  |  |  |
Interest received | $650 | $3,369 | $10,166 | $(1,417) | $12,768
Interest paid | 418 | 115 | 2,432 | (1,417) | 1,548
Income taxes paid (refund) | 2 | (1) | 435 | - | 436

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