<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
33-58482
For Quarter Ended June 30, 1995 Commission File Number 33-1079
SUN LIFE INSURANCE AND ANNUITY COMPANY OF NEW YORK
(Exact name of registrant as specified in its charter)
NEW YORK 04-2845273
(State or other jurisdiction of (IRS Employer I.D. No.)
incorporation or organization)
80 BROAD STREET, NEW YORK, N.Y. 10004
(Address of Principal Executive Office) (Zip Code)
Registrant's telephone number, including area code (212) 943-3855
NONE
Former name, former address, and former fiscal year,
if changed since last report
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
(1) Yes /X/ No / /
(2) Yes /X/ No / /
THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)
(a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED
DISCLOSURE FORMAT PERMITTED BY INSTRUCTION H.
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SUN LIFE INSURANCE AND ANNUITY COMPANY OF NEW YORK
INDEX
Page
Number
Part I: Financial Information
Item 1: Financial Statements:*
Balance Sheets -
June 30, 1995 and December 31, 1994 3
Statements of Operations -
Three Months Ended
June 30, 1995 and June 30, 1994 4
Statements of Operations -
Six Months Ended
June 30, 1995 and June 30, 1994 5
Statements of Capital Stock and Surplus -
Six Months Ended
June 30, 1995 and June 30, 1994 6
Statements of Cash Flows -
Six Months Ended
June 30, 1995 and June 30, 1994 7
Notes to Unaudited Financial Statements 8
Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
Part II: Other Information
NONE
* The balance sheet at December 31, 1994 has been taken from the
audited financial statements at that date. All other statements are
unaudited.
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<PAGE>
Item 1. Financial Statements
Sun Life Insurance and Annuity Company of New York
Balance Sheets
<TABLE>
<CAPTION>
(Unaudited) (See note below)
June 30, December 31,
1995 1994
-------------- -------------------
<S> <C> <C>
ASSETS
Bonds $ 160,085,856 $ 188,460,195
Mortgage loans 59,941,404 63,377,327
Real estate 815,583 823,655
Policy loans 506,231 520,383
Cash 1,062,039 (756,378)
Investment income due and accrued 3,754,551 4,393,086
Other assets 111,011 1,512,498
------------- ----------------
General account assets 226,276,675 258,330,766
------------- ----------------
Separate account assets
Unitized 232,077,326 210,706,368
Non-unitized 70,230,559 34,945,221
------------- ----------------
Total assets $ 528,584,560 $ 503,982,355
------------- ----------------
------------- ----------------
LIABILITIES
Reserves for unmatured obligations $ 21,130,533 $ 20,402,804
Annuity deposits 167,543,661 201,476,544
Accrued expenses and taxes 296,264 525,863
Other liabilities 439,289 539,438
Due to parent and affiliates - net (1,146,290) 591,254
Due to separate accounts 2,529,166
Interest maintenance reserve 1,673,625 1,778,014
Asset valuation reserve 1,644,036 1,763,921
------------- ----------------
General account liabilities 194,110,284 227,077,838
------------- ----------------
Separate account liabilities
Unitized 231,916,929 210,550,227
Non-unitized 70,230,559 34,945,221
------------- ----------------
Total liabilities 496,257,772 472,573,286
------------- ----------------
CAPITAL STOCK AND SURPLUS
Capital stock - Par value $1,000
Authorized, issued and outstanding
2,000 shares 2,000,000 2,000,000
Surplus 30,326,788 29,409,069
------------- ----------------
Total capital stock and surplus 32,326,788 31,409,069
------------- ----------------
Total liabilities, capital stock and surplus $ 528,584,560 $ 503,982,355
------------- ----------------
------------- ----------------
</TABLE>
Note: The balance sheet at December 31, 1994 has been taken from the audited
financials at that date.
See notes to unaudited financial statements.
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Sun Life Insurance and Annuity Company of New York
Statements of Operations
<TABLE>
<CAPTION>
Three Months Ended June 30,
1995 1994
-------------- ---------------
<S> <C> <C>
INCOME
Premiums and annuity considerations $ 3,124,693 $ 1,560,958
Annuity deposit funds 12,917,230 5,805,368
Net investment income 4,667,728 5,489,498
Amortization of interest maintenance reserve 176,357 175,086
Realized losses on investments (222,277) (341,201)
Mortality and expense risk charges 726,103 683,226
-------------- ---------------
21,389,834 13,372,935
-------------- ---------------
BENEFITS AND EXPENSES
Increase (decrease) in actuarial reserves 617,718 (486,002)
Decrease in liability for annuity deposit funds (18,727,088) (18,023,010)
Death, health benefits and annuity payments 2,111,892 2,007,062
Annuity deposit fund withdrawals 23,491,384 22,424,401
Surplus transfer to (from) separate account 1,633,928 (97,564)
Transfers to non-unitized separate account 9,819,463 4,721,958
-------------- ---------------
18,947,297 10,546,845
General expenses 1,401,949 1,194,465
Commissions 866,779 740,535
Taxes, licenses and fees 215,509 95,411
-------------- ---------------
21,431,534 12,577,256
-------------- ---------------
Net income (loss) from operations before
federal income tax (41,700) 795,679
Federal income tax (benefit) expense (991,398) 150,000
-------------- ---------------
Net income $ 949,698 $ 645,679
-------------- ---------------
-------------- ---------------
</TABLE>
See notes to unaudited financial statements.
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Sun Life Insurance and Annuity Company of New York
Statements of Operations
<TABLE>
<CAPTION>
Six Months Ended June 30,
1995 1994
-------------- ---------------
<S> <C> <C>
INCOME
Premiums and annuity considerations $ 5,577,604 $ 3,951,370
Annuity deposit funds 35,969,744 9,278,344
Net investment income 9,767,045 11,351,232
Amortization of interest maintenance reserve 362,016 341,548
Realized losses on investments (672,277) (468,920)
Mortality and expense risk charges 1,415,510 1,372,361
-------------- ---------------
52,419,642 25,825,935
-------------- ---------------
BENEFITS AND EXPENSES
Increase (decrease) in actuarial reserves 727,729 (175,525)
Decrease in liability for annuity deposit funds (33,932,883) (20,533,943)
Death, health benefits and annuity payments 4,379,226 4,269,822
Annuity deposit fund withdrawals 43,106,230 30,283,528
Surplus transfer to (from) separate account 3,837,362 (384,136)
Transfers to non-unitized separate account 29,862,596 6,358,425
-------------- ---------------
47,980,260 19,818,171
General expenses 3,133,440 2,347,779
Commissions 2,040,263 1,506,788
Taxes, licenses and fees 341,962 203,173
-------------- ---------------
53,495,925 23,875,911
-------------- ---------------
Net income (loss) from operations before
federal income tax (1,076,283) 1,950,024
Federal income tax (benefit) expense (1,838,723) 450,000
-------------- ---------------
Net income $ 762,440 $ 1,500,024
-------------- ---------------
-------------- ---------------
</TABLE>
See notes to unaudited financial statements.
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<PAGE>
Sun Life Insurance and Annuity Company of New York
Statements of Capital Stock and Surplus
<TABLE>
<CAPTION>
Six Months Ended June 30,
1995 1994
-------------- ---------------
<S> <C> <C>
Capital stock $ 2,000,000 $ 2,000,000
Paid-in surplus 28,750,000 28,750,000
Special contingency reserve 750,000 750,000
Unassigned surplus
Balance, beginning of period (90,931) (4,295,377)
Net income 762,440 1,500,024
Change in non-admitted assets 31,138 (133,136)
Change in and transfers of separate
account surplus 4,256 2,218
Change in asset valuation reserve 119,885 (35,113)
-------------- ---------------
Balance, end of period 826,788 (2,961,384)
-------------- ---------------
Total surplus 30,326,788 26,538,616
-------------- ---------------
Total capital stock and surplus $ 32,326,788 $ 28,538,616
-------------- ---------------
-------------- ---------------
</TABLE>
See notes to unaudited financial statements.
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<PAGE>
Sun Life Insurance and Annuity Company of New York
Statements of Cash Flows
<TABLE>
<CAPTION>
Six Months Ended June 30,
1995 1994
--------------- ---------------
<S> <C> <C>
Cash flows from operating activities:
Net income from operations $ 762,440 $ 1,500,024
Adjustments to reconcile net income
to net cash:
Increase (decrease) in actuarial reserves 727,729 (175,525)
Decrease in liability for annuity deposit funds (33,932,883) (20,533,943)
Decrease in investment income due and
accrued 638,535 606,040
Net accrual and amortization of discount
and premium on investments 122,463 220,975
Realized losses on investments 672,277 468,920
Change in non-admitted assets 31,138 (133,136)
Other 1,780,919 (338,667)
--------------- ---------------
Net cash used in operating activities (29,197,382) (18,385,312)
--------------- ---------------
Cash flows from investing activities:
Proceeds from sale and maturity of investments 71,937,645 50,568,475
Purchase of investments (36,857,639) (29,887,072)
Net change in short-term investments (4,064,207) (2,396,944)
--------------- ---------------
Net cash provided by investing activities 31,015,799 18,284,459
--------------- ---------------
Increase (decrease) in cash during the period 1,818,417 (100,853)
Cash, beginning of period (756,378) (569,290)
--------------- ---------------
Cash, end of period $ 1,062,039 $ (670,143)
--------------- ---------------
--------------- ---------------
</TABLE>
See notes to unaudited financial statements.
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<PAGE>
Sun Life Insurance and Annuity Company of New York
Notes to Unaudited Financial Statements
(1) General
In management's opinion all adjustments, which include only normal recurring
adjustments, necessary for a fair presentation of the financial statements
have been made.
(2) Management and Service Contracts
The Registrant has agreements with Sun Life (Canada) which provide that Sun
Life (Canada) will furnish to the Registrant, as requested, personnel as well
as certain investment and administrative services on a cost reimbursement
basis. Expenses under these agreements amounted to approximately $388,000 and
$894,000 for the three month and six month periods in 1995 and approximately
$386,000 and $784,000 for the three month and six month periods in 1994,
respectively.
-8-
<PAGE>
Sun Life Insurance and Annuity Company of New York
Management's Discussion and Analysis of Financial Condition
and Results of Operations
The Registrant had net income of $950,000 and $762,000 in the three
and six month periods ended June 30, 1995 as compared to $646,000 and
$1,500,000 for the same periods ended June 30, 1994. The $304,000 increase
between the three month periods is due primarily to a federal income tax
benefit while the $738,000 decrease between the six month periods is due
primarily to a surplus transfer to the Registrant's separate account.
Total income increased by $8,017,000 and $26,594,000 for the three and six
month periods ended June 30, 1995 as compared with the same periods in 1994
as a result of an increase in group life and health premiums and annuity
deposit funds, offset by a decrease in net investment income. The increase in
group life and health premiums is the result of the Registrant establishing
itself in the New York group market while the increase in annuity deposit
funds is due directly to higher credited rates. The decrease in net
investment income is due to a decrease in invested assets, primarily the
result of the Registrant selling fixed income securities to cover maturing
annuity deposit fund obligations.
Policyholder benefits increased by $8,400,000 and $28,162,000 for the three
and six month periods ended June 30, 1995 as compared with the comparable
periods in 1994 as the result of an increase in annuity deposit fund
withdrawals, transfers to the non-unitized separate account and surplus
transfer to the separate account, offset by a decrease in liability for annuity
deposit funds. The increase in annuity deposit fund withdrawals is directly
attributable to an increase in maturing fixed annuity contracts, while the
transfers to the non-unitized separate account results from increased sales
of the Registrant's market-value adjusted deferred fixed annuity contract.
The increase in surplus transfer to the separate account is due to a change
in methodology of calculating the gross earned rate, which resulted in higher
market value adjusted reserves. The decrease in the liability for annuity
deposit funds reflects the increase in annuity deposit fund withdrawals.
General expenses, commissions and taxes increased by $454,000 and $1,458,000
for the three and six month periods in 1995 as a result of increases in
allocations from the Registrant's parent, annuity sales and franchise taxes.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Sun Life Insurance and
Annuity Company of New York
August 11, 1995 /s/ David D. Horn
-----------------------------
David D. Horn
Senior Vice President
August 11, 1995 /s/ Bonnie S. Angus
------------------------------
Bonnie S. Angus
Secretary
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