<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 March 31, 1996 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 -
March 31, 1996 and December 31, 1995* 3
Statements of Operations -
Three Months Ended
March 31, 1996 and March 31, 1995 4
Statements of Capital Stock and Surplus -
Three Months Ended
March 31, 1996 and March 31, 1995 5
Statements of Cash Flows -
Three Months Ended
March 31, 1996 and March 31, 1995 6
Notes to Unaudited Financial Statements 7
Item 2: Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
Part II: Other Information
NONE
* The balance sheet at December 31, 1995 has been taken from the audited
financial statements at that date. All other statements are unaudited.
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PART 1: FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
SUN LIFE INSURANCE AND ANNUITY COMPANY OF NEW YORK
BALANCE SHEETS
<TABLE>
<CAPTION>
(UNAUDITED) (SEE NOTE BELOW)
MARCH 31, DECEMBER 31,
ASSETS 1996 1995
------------ ------------
<S> <C> <C>
Bonds $129,693,184 $132,026,064
Mortgage loans 48,316,508 51,843,936
Policy loans 515,702 476,194
Cash 498,472 1,267,905
Investment income due and accrued 2,863,385 3,255,286
Other assets 450,939 443,663
------------ ------------
General account assets 182,338,190 189,313,048
------------ ------------
Separate account assets
Unitized 255,076,536 250,782,417
Non-unitized 80,606,212 81,110,554
------------ ------------
Total assets $518,020,938 $521,206,019
------------ ------------
------------ ------------
LIABILITIES
Policy reserves $ 24,333,564 $ 23,548,885
Annuity and other deposits 119,787,747 129,743,536
Accrued expenses and taxes 409,367 376,573
Other liabilities 810,877 906,238
Due to parent and affiliates - net 1,014,777 (1,292,878)
Due to separate accounts 1,227,171 1,036,679
Interest maintenance reserve 1,702,453 1,648,375
Asset valuation reserve 1,476,427 1,545,857
------------ ------------
General account liabilities 150,762,383 157,513,265
------------ ------------
Separate account liabilities
Unitized 254,909,934 250,617,786
Non-unitized 80,606,212 81,110,554
------------ ------------
Total liabilities 486,278,529 489,241,605
------------ ------------
CAPITAL STOCK AND SURPLUS
Capital stock - Par value $1,000
Authorized, issued and outstanding
2,000 shares 2,000,000 2,000,000
Surplus 29,742,409 29,964,414
------------ ------------
Total capital stock and surplus 31,742,409 31,964,414
------------ ------------
Total liabilities, capital stock and surplus $518,020,938 $521,206,019
------------ ------------
------------ ------------
</TABLE>
Note: The balance sheet at December 31, 1995 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 MARCH 31,
1996 1995
----------- -----------
<S> <C> <C>
INCOME
Premiums and annuity considerations $ 3,195,110 $ 2,452,911
Annuity and other deposit funds 2,542,860 23,052,514
Net investment income 3,556,647 5,099,317
Amortization of interest maintenance reserve 183,397 185,659
Realized losses on investments 0 (450,000)
Mortality and expense risk charges 836,799 689,407
----------- -----------
10,314,813 31,029,808
----------- -----------
BENEFITS AND EXPENSES
Increase in policy reserves 784,679 110,011
Decrease in liability for annuity
and other deposit funds (9,955,789) (15,205,795)
Death, health benefits and annuity payments 1,947,339 2,267,334
Annuity and other deposit fund withdrawals 15,205,960 19,614,846
Surplus transfer to separate account 190,492 2,203,434
Transfers to (from) non-unitized separate account (39,146) 20,043,133
----------- -----------
8,133,535 29,032,963
General expenses 1,237,168 1,731,491
Commissions 684,118 1,173,484
Taxes, licenses and fees 176,346 126,453
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10,231,167 32,064,391
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Net income (loss) from operations before
federal income tax 83,646 (1,034,583)
Federal income tax expense (benefit) 262,129 (847,325)
----------- -----------
Net loss $ (178,483) $ (187,258)
----------- -----------
----------- -----------
</TABLE>
See notes to unaudited financial statements.
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SUN LIFE INSURANCE AND ANNUITY COMPANY OF NEW YORK
STATEMENTS OF CAPITAL STOCK AND SURPLUS
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31,
1996 1995
----------- -----------
<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 464,414 (90,931)
Net loss (178,483) (187,258)
Unrealized losses (125,000) 0
Change in non-admitted assets 10,077 21,471
Change in separate account surplus 1,971 2,106
Change in asset valuation reserve 69,430 (244,609)
----------- -----------
Balance, end of period 242,409 (499,221)
----------- -----------
Total surplus 29,742,409 29,000,779
----------- -----------
Total capital stock and surplus $31,742,409 $31,000,779
----------- -----------
----------- -----------
</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>
THREE MONTHS ENDED MARCH 31,
1996 1995
------------ ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss from operations $ (178,483) $ (187,258)
ADJUSTMENTS TO RECONCILE NET INCOME
TO NET CASH:
Increase in policy reserves 784,679 110,011
Decrease in liability for annuity
and other deposit funds (9,955,789) (15,205,795)
Decrease in investment income
due and accrued 391,901 382,829
Net accrual and amortization of discount
and premium on investments 66,078 68,935
Realized losses on investments 0 450,000
Change in non-admitted assets 10,077 21,471
Other 2,442,873 384,414
------------ ------------
Net cash used in operating activities (6,438,664) (13,975,393)
------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale and maturity of investments 19,824,304 31,537,439
Purchase of investments (6,249,706) (18,448,820)
Net change in short-term investments (7,905,367) 2,078,894
------------ ------------
Net cash provided by investing activities 5,669,231 15,167,513
------------ ------------
Increase (decrease) in cash during the period (769,433) 1,192,120
Cash, beginning of period 1,267,905 (756,378)
------------ ------------
Cash, end of period $ 498,472 $ 435,742
------------ ------------
------------ ------------
</TABLE>
See notes to unaudited financial statements.
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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 $424,000 and
$506,000 for the three month periods in 1996 and 1995, respectively.
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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 losses of $178,000 and $187,000 in the three month
periods ended March 31, 1996 and March 31, 1995, respectively.
Total income for the three months ended March 31, 1996 was $10,315,000, a
decrease of $20,715,000 from the same period one year ago. The decrease was
primarily the result of decreases in annuity sales and net investment income.
The decrease in annuity sales was due directly to lower credited rates, while
the decrease in net investment income was due to a decline in invested
assets, primarily the result of the Registrant selling fixed income
securities to cover maturing annuity deposit fund obligations.
Policyholder benefits for the three months ended March 31, 1996 decreased
$20,899,000 to $8,134,000. The decrease was primarily due to a decrease in
transfers to the non-unitized separate account, the result of a decrease in
sales of the Registrant's market-value adjusted deferred annuity contract.
General expenses and commissions decreased by $984,000 for the three month
period ended March 31, 1996 as a result of a decrease in annuity sales.
Federal income taxes increased $1,110,000 over the same period one year ago
as a result of an under-accrued income tax provision at March 31, 1995.
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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
May 13, 1996 /s/ Robert P. Vrolyk
----------------------------
Robert P. Vrolyk
Vice President, Controller
and Actuary
May 13, 1996 /s/ Bonnie S. Angus
----------------------------
Bonnie S. Angus
Secretary
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