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JOHN HANCOCK REGISTERS $228.1 MILLION NET GAIN FROM OPERATIONS IN 1991

JOHN HANCOCK REGISTERS $228.1 MILLION NET GAIN FROM OPERATIONS IN 1991
 BOSTON, March 25 /PRNewswire/ -- John Hancock Financial Services posted a net gain from operations of $228.1 million for 1991, an increase of almost 7 percent over the previous year, Stephen L. Brown, chairman and chief executive officer, announced today.
 Brown said that additions to surplus, a key measure of profitability for a mutual life insurance company, totaled $163 million, raising the company's surplus 11.5 percent to almost $1.6 billion.
 The company's capital position -- statutory surplus plus reserves set aside to protect against adverse investment experience -- surpassed $2.1 billion in 1991. Over the past three years, capital, or management surplus, has increased $607 million, or more than 40 percent.
 Brown said the company's 1991 results, filed with the Massachusetts Division of Insurance, show that John Hancock's financial quality efforts have paid off. "When viewed within the context of the existing economic climate," he added, "the results are quite a testament to the drive and dedication of our people."
 "With consumers more cautious about the financial services industry, we are pleased with such strong gains and additions to surplus and capital."
 William L. Boyan, president and chief operations officer, said problem mortgages and real estate decreased by more than $100 million and, as a percentage of invested assets, dropped to 2.0 percent in 1991 from 2.5 percent in 1990.
 He said, "Our outstanding ability to select and manage both agricultural and commercial real estate investments has allowed us to avoid many of the problems that plague other financial services providers."
 "The expertise of our professional investment staff has enabled us to identify and restructure potential problem mortgages," he said. "As a result of theses and other initiatives, the most common industry measure of problem mortgages -- those 90 days overdue or in the process of foreclosure -- has been reduced as a percentage of invested assets for the fourth straight year."
 Boyan said that the quality of the company's bond portfolio, which at more than $14 billion constitutes the largest portion of invested assets, remained high. "Our bond portfolio yield of 10.8 percent is among the industry's highest. Our loss experience -- the best indicator of asset quality -- has been modest over the past 20 years. The actual 1991 losses were higher than average but within expected levels given the economy."
 Foster L. Aborn, vice chairman and chief investment officer, said the company has undertaken steps to strengthen its already strong liquidity position. "With consumer confidence shaken by problems in the banking and savings & loan industries and failures in the insurance industry, our management team felt a need to demonstrate further to the public our outstanding financial strength," Aborn said.
 "We have built our credit lines by establishing a revolving line of credit of $1 billion with a consortium of banks, led by Morgan Guaranty," he said.
 John Hancock has increased its holdings of more liquid public bonds by exchanging $1 billion of mortgages with the Federal National Mortgage Association for Fannie Mae guaranteed mortgage-backed securities. The company also has securitized $800 million of its bond portfolio.
 Aborn reported that net investment income for John Hancock increased 8 percent to $3 billion in 1991.
 Consolidated assets of John Hancock Mutual Life Insurance Co. and its variable life subsidiary increased 7.8 percent during the year to $38.1 billion. Assets under management by John Hancock and its 22 subsidiaries reached $57 billion in 1991.
 The company paid $6.5 billion to policyholders and their beneficiaries in 1991, including $410 million in dividends to policyholders.
 Asset valuation reserves increased by about $31 million to $527.3 million, with the increase intended to protect against potential investment losses.
 Total earned product and service income (PSI), an internal measurement that enables the company to track the growth of dissimilar financial services operations, increased 8.8 percent to more than $1.8 billion, with all segments of the business contributing significantly.
 The Retail Sector's earned PSI increased by 2.4 percent to $793 million. Continued strong sales in the annuities and long-term care areas helped set the pace. The annuity business contributed $68 million in earned PSI, an increase of 21 percent over 1990. The long-term care business contributed $15 million, an increase of 41 percent over 1990.
 The company's new Business Insurance Sector posted an earned PSI of $495 million, an increase of 8.5 percent.
 The Investment and Pension group's earned PSI grew by 18.6 percent to $479 million. Contributing to the growth was earned PSI for guaranteed investment contracts, which rose 17.5 percent from 1990.
 -0- 3/25/92
 /CONTACT: Pamela Kruh of John Hancock Financial Services, 617-572-0558/ CO: John Hancock Financial Services ST: Massachusetts IN: FIN SU: ERN


TS-SH -- NY026 -- 1496 03/25/92 11:52 EST
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Date:Mar 25, 1992
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