Three-month Manulife TSX trading The financial meltdown cut deeply into the first-quarter results of three large Canadian insurance companies, putting two into the red and slashing profit at the third.

Manulife Financial reported a loss of more than $1 billion in the first quarter, Sun Life lost more than $200 million and profit at Great-West Lifeco was cut in half, to $326 million, the companies reported Thursday.

At two companies, the necessity for higher reserves as investments declined in value contributed to the losses. Great-West, however, said it did not need to establish reserves, as the other companies did.

At Manulife, "Actuarial practices require us to value our assets and liabilities at the quarter-end mark, despite the very long-term nature of these holdings and obligations," Peter Rubenovitch, chief financial officer, said in a news release.

With the market turmoil, the accounting rules make results volatile, "which detracts from our strong core business results," he added.

The loss reflected weak equity markets, particularly in the United States. Charges for equity losses, real estate and credit downgrades swamped the $803 million quarterly profit.

The loss, however, would have been even bigger but for a $1.06 billion income-tax reduction.

Investors reacted by knocking Manulife stock down 56 cents to close at $22.18 in TSX trading.

The loss for three months ended March 31 was $1.08 billion (67 cents a diluted share), compared with a profit of $862 million (57 cents) a year earlier. Revenue was $8 billion, compared with $7.97 billion.

Great-West avoids worst of market turmoil

Great-West said profit was $326 million (34 cents a share,) compared with $654 million (60 cents) a year earlier.

The company said increased provisions for future credit losses and asset impairment charges cut 2009 profit. The 2008 figure includes $43 million from discontinued operations, and two non-recurring items totalling $118 million. Premiums and deposits were $14.56 billion, compared with $29.45 billion in the first quarter of 2008.

Great-West stock fell $1.44 to $21.45 in TSX trading.

Sun Life loses $213M

Sun Life Financial Inc. reported a $213 million loss for the three months ended March 31, compared with a $533 million profit a year earlier.

Three-month Sun Life TSX trading

As with Manulife, there were hundreds of millions of dollars of charges to boost reserves taken to protect against losses on equities, downgrades on the company's investment portfolio, and credit and equity impairments.

Calling the results "disappointing," CEO Donald A. Stewart said the company would come out of the recession stronger, more focused and competitive.

The company said the operating loss was $186 million, with restructuring charges boosting it to $213 million.

The loss per diluted share was 38 cents, compared with a profit of 93 cents.

Revenue was $5.03 billion, compared with $3.89 billion.

Sun Life stock closed down $1.96 at $28 in TSX trading.