DBRS Assigns AA (low) Rating to The Manufacturers Investment Corporation

DBRS has today assigned a new rating of AA (low) to the $220 million 6.822% Senior Unsecured Notes due May 31, 2011 and the $175 million 6.646% Senior Unsecured Notes due November 30, 2011 of The Manufacturers Investment Corporation (MIC), both guaranteed by Manulife Financial Corporation (collectively, the Notes). The Notes were originally issued by John Hancock Canadian Corporation and subsequently assumed by John Hancock Financial Services Inc. (JHFS). The current rating on the JHFS Notes is correspondingly being discontinued. All other ratings of Manulife Financial Corporation (MFC) and its affiliates remain unchanged.

On December 31, 2009, JHFS was merged into MIC as part of a corporate reorganization. The obligations under the Notes were simultaneously assumed by MIC but continue to benefit from the guarantee of MFC.

The reorganization of MFC’s U.S. operating subsidiaries will have the effect of consolidating most of the U.S. insurance operations under The Manufacturers Life Insurance Company (MLI), with the intention of establishing a more capital- and tax-efficient corporate structure. While the reorganization will initially reduce MLI’s minimum continuing capital and surplus requirement (MCCSR) ratio from the 229% reported at the end of September 2009 on a proforma basis, it is also expected to reduce the sensitivity of the ratio to further equity market deterioration.

The newly assigned rating reflects the senior guarantee of MFC. DBRS has reviewed the terms of the MFC guarantee and understands that obligations under the guarantee will rank pari passu with all senior debt obligations of MFC, including the Medium-Term Notes issued by MFC, which DBRS also rates AA (low) with a Stable trend.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The Senior Unsecured Notes are guaranteed by Manulife Financial Corporation.

The applicable methodology is Rating Canadian Life Insurance, which can be found on our website under Methodologies.

This is a Corporate (Financial Institutions) rating.