(Bloomberg) -- Manulife Financial Corp.’s Canadian business boosted profit last quarter on the back of rising sales and lower-than-expected benefit use, cushioning the toll that continued Covid-19 restrictions are taking on its Asian operations.   

Core earnings in Canada rose 8.5% from a year earlier to C$345 million ($270 million) in the second quarter, the Toronto-based company said Wednesday. Overall second-quarter profit topped analysts’ estimates. 

Chief Executive Officer Roy Gori said that Manulife’s home country of Canada remains a “strong growth market” for the company and one it continues to invest in as the penetration of insurance products is still relatively low. The country’s economy also has remained resilient through the turbulence of this year, he said.

“Canada does have low unemployment and has benefited from the commodities boom, and that puts Canada in quite a unique and strong position to help manage through what will be a challenging macroeconomic environment,” Gori said in an interview.

Annualized premium equivalent sales in Canada rose 32% from a year earlier, the company said. Core earnings in the operation also were helped by policy use in the group benefits business that was less than the company had expected, Gori said.

Meanwhile, Manulife’s core earnings in Asia fell 2.5% last quarter, hurt by lower sales in Hong Kong and in the Japanese corporate-owned life market. Gori said he expects the remaining restrictions in Manulife’s Asian markets to be temporary and that the company will start to resume more positive sales momentum in the coming quarters.

Manulife shares fell 1% to C$23.94 at 11:10 a.m. in Toronto. The stock is down 0.7% this year, compared with a 5.6% drop for the S&P/TSX Composite Index.

Also in the release:

  • Net income fell 59% to C$1.09 billion, or 53 cents a share.
  • Excluding some items, profit was 78 cents a share. Analysts estimated 76 cents, on average.
  • Core earnings in the global wealth and asset management business fell 14% to C$305 million.

(Updates with share price in seventh paragraph)

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