EX-99.2

EX-99.2 3 d405783dex992.htm EX-99.2 EX-99.2

Exhibit 99.2

LOGO

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016


Table of Contents	Page
Investor Letter		3
Use of Non-GAAP Measures		4
Results of Operations and Selected Operating Performance Measures		5
Financial Highlights		6

*Consolidated Quarterly Results*
Consolidated Net Income (Loss) by Quarter		8
Net Operating Income (Loss) by Segment by Quarter		9
Consolidated Balance Sheets		10-11
Consolidated Balance Sheets by Segment		12-13
Deferred Acquisition Costs (DAC) Rollforward		14

*Quarterly Results by Business*
Net Operating Income and Sales—U.S. Mortgage Insurance Segment		16-22
Net Operating Income and Sales—Canada Mortgage Insurance Segment		24-27
Net Operating Income and Sales—Australia Mortgage Insurance Segment		29-32
Net Operating Income (Loss) and Sales—U.S. Life Insurance Segment		34-37
Net Operating Income (Loss)—Runoff Segment		39
Net Operating Loss—Corporate and Other Activities		41

*Additional Financial Data*
Investments Summary		43
Fixed Maturity Securities Summary		44
General Account GAAP Net Investment Income Yields		45
Net Investment Gains (Losses), Net—Detail		46

*Reconciliations of Non-GAAP Measures*
Reconciliation of Operating Return On Equity (ROE)		48
Reconciliation of Core Yield		49

*Corporate Information*
Financial Strength Ratings		51

Note:

Unless otherwise noted, references in this financial supplement to income (loss) from continuing operations, income (loss) from continuing operations per share, net income (loss), net income (loss) per share, net operating income (loss), net operating income (loss) per common share, book value and book value per common share should be read as income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders, income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders per share, net income (loss) available to Genworth Financial, Inc.’s common stockholders, net income (loss) available to Genworth Financial, Inc.’s common stockholders per share, net operating income (loss) available to Genworth Financial, Inc.’s common stockholders, net operating income (loss) available to Genworth Financial, Inc.’s common stockholders per share, book value available to Genworth Financial, Inc.’s common stockholders and book value available to Genworth Financial, Inc.’s common stockholders per share, respectively.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Dear Investor,

During the third quarter of 2016, the company completed a review of its long-term care insurance claim reserves. The company made changes to its assumptions and methodologies impacting claim terminations, benefit utilization and incurred but not reported reserves. As a result of these changes, long-term care insurance claim reserves were increased $435 million pre-tax, or $283 million after-tax.

The company also recorded a non-cash charge of $265 million related to deferred tax assets that are not expected to be utilized before their expiration in light of the company’s latest financial projections, including the impact to current and future earnings associated with higher expected claim costs in its long-term care insurance business and sustained low interest rates.

Thank you for your continued interest in Genworth Financial.

Regards,

David Rosenbaum

Investor Relations

InvestorInfo@genworth.com

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Use of Non-GAAP Measures

This financial supplement includes the non-GAAP⁽¹⁾ financial measures entitled “net operating income (loss)” and “net operating income (loss) per common share.” Net operating income (loss) per common share is derived from net operating income (loss). The chief operating decision maker evaluates segment performance and allocates resources on the basis of net operating income (loss). The company defines net operating income (loss) as income (loss) from continuing operations excluding the after-tax effects of income attributable to noncontrolling interests, net investment gains (losses), goodwill impairments, gains (losses) on the sale of businesses, gains (losses) on the early extinguishment of debt, gains (losses) on insurance block transactions, restructuring costs and infrequent or unusual non-operating items. Gains (losses) on insurance block transactions are defined as gains (losses) on the early extinguishment of non-recourse funding obligations, early termination fees for other financing restructuring and/or resulting gains (losses) on reinsurance restructuring for certain blocks of business. The company excludes net investment gains (losses) and infrequent or unusual non-operating items because the company does not consider them to be related to the operating performance of the company’s segments and Corporate and Other activities. A component of the company’s net investment gains (losses) is the result of impairments, the size and timing of which can vary significantly depending on market credit cycles. In addition, the size and timing of other investment gains (losses) can be subject to the company’s discretion and are influenced by market opportunities, as well as asset-liability matching considerations. Goodwill impairments, gains (losses) on the sale of businesses, gains (losses) on the early extinguishment of debt, gains (losses) on insurance block transactions and restructuring costs are also excluded from net operating income (loss) because, in the company’s opinion, they are not indicative of overall operating trends. Infrequent or unusual non-operating items are also excluded from net operating income (loss) if, in the company’s opinion, they are not indicative of overall operating trends.

While some of these items may be significant components of net income (loss) available to Genworth Financial, Inc.’s common stockholders in accordance with GAAP, the company believes that net operating income (loss) and measures that are derived from or incorporate net operating income (loss), including net operating income (loss) per common share on a basic and diluted basis, are appropriate measures that are useful to investors because they identify the income (loss) attributable to the ongoing operations of the business. Management also uses net operating income (loss) as a basis for determining awards and compensation for senior management and to evaluate performance on a basis comparable to that used by analysts. However, the items excluded from net operating income (loss) have occurred in the past and could, and in some cases will, recur in the future. Net operating income (loss) and net operating income (loss) per common share on a basic and diluted basis are not substitutes for net income (loss) available to Genworth Financial, Inc.’s common stockholders or net income (loss) available to Genworth Financial, Inc.’s common stockholders per common share on a basic and diluted basis determined in accordance with GAAP. In addition, the company’s definition of net operating income (loss) may differ from the definitions used by other companies.

Adjustments to reconcile net income (loss) attributable to Genworth Financial, Inc.’s common stockholders and net operating income (loss) assume a 35% tax rate (unless otherwise indicated) and are net of the portion attributable to noncontrolling interests. Net investment gains (losses) are also adjusted for DAC and other intangible amortization and certain benefit reserves (see page 46).

In June 2016, the company completed the sale of its term life insurance new business platform and recorded a pre-tax gain of $12 million. In May 2016, the company completed the sale of its mortgage insurance business in Europe and recorded an additional pre-tax loss of $2 million. In the first quarter of 2016, the company recorded an estimated pre-tax loss of $7 million and a tax benefit of $27 million related to the planned sale of the mortgage insurance business in Europe. The company also recognized an estimated pre-tax loss of $140 million in the fourth quarter of 2015 for the planned sale of this business. The company also incurred a $6 million tax benefit in the fourth quarter of 2015 related to the planned sale as well as a tax charge of $7 million in the third quarter of 2015 from potential business portfolio changes related to this business. These transactions were excluded from net operating income (loss) for the periods presented as they related to a gain (loss) on the sale of businesses.

In June 2016, the company settled restricted borrowings of $70 million related to a securitization entity and recorded a $64 million pre-tax gain related to the early extinguishment of debt. In January 2016, the company paid a pre-tax make-whole expense of $20 million related to the early redemption of Genworth Holdings, Inc.’s (Genworth Holdings) 2016 notes. The company also repurchased $28 million principal amount of Genworth Holdings’ notes with various maturity dates for a pre-tax gain of $4 million in the first quarter of 2016. In the third quarter of 2015, the company paid an early redemption payment of approximately $1 million, net of the portion attributable to noncontrolling interests, related to the early redemption of Genworth Financial Mortgage Insurance Pty Limited’s notes that were scheduled to mature in 2021. In the third quarter of 2015, the company also repurchased approximately $50 million principal amount of Genworth Holdings’ notes with various maturity dates for a pre-tax loss of $1 million. These transactions were excluded from net operating income (loss) for the periods presented as they related to a gain (loss) on the early extinguishment of debt.

In the first quarter of 2016, the company completed a life block transaction resulting in a pre-tax loss of $9 million in connection with the early extinguishment of non-recourse funding obligations. In the third quarter of 2015, the company recorded a pre-tax DAC impairment of $455 million on certain term life insurance policies in connection with entering into an agreement to complete a life block transaction.

In the third, second and first quarters of 2016, the company recorded a pre-tax expense of $2 million, $5 million and $15 million, respectively, related to restructuring costs as part of an expense reduction plan as the company evaluates and appropriately sizes its organizational needs and expenses. In the fourth and second quarters of 2015, the company also recorded a pre-tax expense of $5 million and $3 million, respectively, related to restructuring costs.

There were no infrequent or unusual items excluded from net operating income (loss) during the periods presented other than fees incurred during the first quarter of 2016 related to Genworth Holdings’ bond consent solicitation of $18 million for broker, advisor and investment banking fees.

The table on page 9 of this financial supplement reflects net operating income (loss) as determined in accordance with accounting guidance related to segment reporting, and a reconciliation of net operating income (loss) of the company’s segments and Corporate and Other activities to net income (loss) available to Genworth Financial, Inc.’s common stockholders for the periods presented. The financial supplement includes other non-GAAP measures management believes enhances the understanding and comparability of performance by highlighting underlying business activity and profitability drivers. These additional non-GAAP measures are on pages 48 and 49 of this financial supplement.

⁽¹⁾	U.S. Generally Accepted Accounting Principles

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Results of Operations and Selected Operating Performance Measures

The company’s chief operating decision maker evaluates segment performance and allocates resources on the basis of net operating income (loss). The table on page 9 of this financial supplement reflects net operating income (loss) as determined in accordance with accounting guidance related to segment reporting and a reconciliation of net operating income (loss) of the company’s segments and Corporate and Other activities to net income (loss) available to Genworth Financial, Inc.’s common stockholders for the periods presented.

This financial supplement contains selected operating performance measures including “sales” and “insurance in-force” or “risk in-force” which are commonly used in the insurance industry as measures of operating performance.

Management regularly monitors and reports sales metrics as a measure of volume of new and renewal business generated in a period. Sales refer to: (1) new insurance written for mortgage insurance; (2) annualized first-year premiums for long-term care and term life insurance products; (3) annualized first-year deposits plus 5% of excess deposits for universal and term universal life insurance products; (4) 10% of premium deposits for linked-benefits products; and (5) new and additional premiums/deposits for fixed annuities. Sales do not include renewal premiums on policies or contracts written during prior periods. The company considers new insurance written, annualized first-year premiums/deposits, premium equivalents and new premiums/deposits to be a measure of the company’s operating performance because they represent a measure of new sales of insurance policies or contracts during a specified period, rather than a measure of the company’s revenues or profitability during that period.

Management regularly monitors and reports insurance in-force and risk in-force. Insurance in-force for the mortgage insurance businesses is a measure of the aggregate original loan balance for outstanding insurance policies as of the respective reporting date. Risk in-force for the U.S. mortgage insurance business is based on the coverage percentage applied to the estimated current outstanding loan balance. For risk in-force in the mortgage insurance businesses in Canada and Australia, the company has computed an “effective” risk in-force amount, which recognizes that the loss on any particular loan will be reduced by the net proceeds received upon sale of the property. Effective risk in-force has been calculated by applying to insurance in-force a factor of 35% that represents the highest expected average per-claim payment for any one underwriting year over the life of the company’s mortgage insurance businesses in Canada and Australia. In Australia, the company has certain risk share arrangements where it provides pro-rata coverage of certain loans rather than 100% coverage. As a result, for loans with these risk share arrangements, the applicable pro-rata coverage amount provided is used when applying the factor. The company considers insurance in-force and risk in-force to be measures of the company’s operating performance because they represent measures of the size of the business at a specific date which will generate revenues and profits in a future period, rather than measures of the company’s revenues or profitability during that period.

Management also regularly monitors and reports a loss ratio for the company’s businesses. For the mortgage insurance businesses, the loss ratio is the ratio of incurred losses and loss adjustment expenses to net earned premiums. For the long-term care insurance business, the loss ratio is the ratio of benefits and other changes in reserves less tabular interest on reserves less loss adjustment expenses to net earned premiums. The company considers the loss ratio to be a measure of underwriting performance in these businesses and helps to enhance the understanding of the operating performance of the businesses.

These operating performance measures enable the company to compare its operating performance across periods without regard to revenues or profitability related to policies or contracts sold in prior periods or from investments or other sources.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Financial Highlights

(amounts in millions, except per share data)


Balance Sheet Data	September 30, 2016			June 30, 2016		March 31, 2016		December 31, 2015			September 30, 2015
Total Genworth Financial, Inc.’s stockholders’ equity, excluding accumulated other comprehensive income	$	9,669		$	10,045	$	9,870	$	9,814		$	10,101
Total accumulated other comprehensive income		5,202			5,088		4,185		3,010			3,478

Total Genworth Financial, Inc.’s stockholders’ equity	$	14,871		$	15,133	$	14,055	$	12,824		$	13,579

Book value per common share	$	29.84		$	30.37	$	28.19	$	25.76		$	27.29
Book value per common share, excluding accumulated other comprehensive income	$	19.40		$	20.16	$	19.80	$	19.71		$	20.30
Common shares outstanding as of the balance sheet date		498.4			498.3		498.5		497.8			497.5

	Twelve months ended
Twelve Month Rolling Average ROE	September 30, 2016			June 30, 2016		March 31, 2016		December 31, 2015			September 30, 2015
GAAP Basis ROE		-4.5	%		-3.5%		-7.0%		-6.0	%		-10.3	%
Operating ROE⁽¹⁾		-2.6	%		2.1%		2.0%		2.5	%		-0.7	%

	Three months ended
Quarterly Average ROE	September 30, 2016			June 30, 2016		March 31, 2016		December 31, 2015			September 30, 2015
GAAP Basis ROE		-15.4	%		6.9%		2.2%		-11.7	%		-11.1	%
Operating ROE⁽¹⁾		-16.4	%		4.9%		4.2%		-3.3	%		2.5	%


Basic and Diluted Shares	Three months ended September 30, 2016		Nine months ended September 30, 2016
Weighted-average common shares used in basic earnings per common share calculations		498.3		498.3
Potentially dilutive securities:
Stock options, restricted stock units and stock appreciation rights		—		—

Weighted-average common shares used in diluted earnings per common share calculations⁽²⁾		498.3		498.3

⁽¹⁾	See page 48 herein for a reconciliation of GAAP Basis ROE to Operating ROE.

⁽²⁾

Under applicable accounting guidance, companies in a loss position are required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share. Therefore, as a result of the loss from continuing operations for the three and nine months ended September 30, 2016, the company was required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share for the three and nine months ended September 30, 2016, as the inclusion of shares for stock options, restricted stock units and stock appreciation rights of 2.2 million and 1.8 million, respectively, would have been antidilutive to the calculation. If the company had not incurred a loss from continuing operations for the three and nine months ended September 30, 2016, dilutive potential weighted-average common shares outstanding would have been 500.5 million and 500.1 million, respectively.

Consolidated Quarterly Results

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Consolidated Net Income (Loss) by Quarter

(amounts in millions, except per share amounts)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
REVENUES:
Premiums	$	1,108		$	1,127		$	794		$	3,029		$	1,157		$	1,145		$	1,134		$	1,143		$	4,579
Net investment income		805			779			789			2,373			781			783			793			781			3,138
Net investment gains (losses)		20			30			(19	)		31			(16	)		(51	)		8			(16	)		(75	)
Policy fees and other income		217			300			221			738			234			223			222			227			906

Total revenues		2,150			2,236			1,785			6,171			2,156			2,100			2,157			2,135			8,548

BENEFITS AND EXPENSES:
Benefits and other changes in policy reserves		1,662			1,193			860			3,715			1,435			1,290			1,232			1,192			5,149
Interest credited		173			173			177			523			180			179			181			180			720
Acquisition and operating expenses, net of deferrals		269			327			394			990			433			314			295			267			1,309
Amortization of deferred acquisition costs and intangibles		94			112			99			305			207			563			101			95			966
Interest expense		77			80			105			262			104			105			103			107			419

Total benefits and expenses		2,275			1,885			1,635			5,795			2,359			2,451			1,912			1,841			8,563

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		(125	)		351			150			376			(203	)		(351	)		245			294			(15	)
Provision (benefit) for income taxes		222			110			23			355			(36	)		(134	)		70			91			(9	)

INCOME (LOSS) FROM CONTINUING OPERATIONS		(347	)		241			127			21			(167	)		(217	)		175			203			(6	)
Income (loss) from discontinued operations, net of taxes⁽¹⁾		15			(21	)		(19	)		(25	)		(73	)		(21	)		(314	)		1			(407	)

NET INCOME (LOSS)		(332	)		220			108			(4	)		(240	)		(238	)		(139	)		204			(413	)
Less: net income attributable to noncontrolling interests		48			48			55			151			52			46			54			50			202

NET INCOME (LOSS) AVAILABLE TO GENWORTH FINANCIAL, INC.’S COMMON STOCKHOLDERS	$	(380	)	$	172		$	53		$	(155	)	$	(292	)	$	(284	)	$	(193	)	$	154		$	(615	)

Earnings (Loss) Per Share Data:
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders per common share
Basic	$	(0.79	)	$	0.39		$	0.14		$	(0.26	)	$	(0.44	)	$	(0.53	)	$	0.24		$	0.31		$	(0.42	)
Diluted	$	(0.79	)	$	0.39		$	0.14		$	(0.26	)	$	(0.44	)	$	(0.53	)	$	0.24		$	0.31		$	(0.42	)
Net income (loss) available to Genworth Financial, Inc.’s common stockholders per common share
Basic	$	(0.76	)	$	0.35		$	0.11		$	(0.31	)	$	(0.59	)	$	(0.57	)	$	(0.39	)	$	0.31		$	(1.24	)
Diluted	$	(0.76	)	$	0.34		$	0.11		$	(0.31	)	$	(0.59	)	$	(0.57	)	$	(0.39	)	$	0.31		$	(1.24	)
Weighted-average common shares outstanding
Basic		498.3			498.5			498.0			498.3			497.6			497.4			497.4			497.0			497.4
Diluted⁽²⁾		498.3			500.4			499.4			498.3			497.6			497.4			499.3			498.9			497.4

⁽¹⁾

Income (loss) from discontinued operations related to the lifestyle protection business that was sold on December 1, 2015. During the third, second and first quarters of 2016, the company recorded an additional after-tax gain (loss) of approximately $15 million, $(21) million and $(19) million, respectively, as it finalized the closing balance sheet purchase price adjustments.

⁽²⁾

Under applicable accounting guidance, companies in a loss position are required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share. Therefore, as a result of the loss from continuing operations, the company was required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share as the inclusion of shares for stock options, restricted stock units and stock appreciation rights of 2.2 million, 1.4 million and 1.3 million, respectively, for the three months ended September 30, 2016, December 31, 2015 and September 30, 2015 and 1.8 million and 1.6 million, respectively, for the nine months ended September 30, 2016 and the twelve months ended December 31, 2015 would have been antidilutive to the calculation. If the company had not incurred a loss from continuing operations in these periods, dilutive potential weighted-average common shares outstanding would have been 500.5 million, 499.0 million and 498.7 million, respectively, for the three months ended September 30, 2016, December 31, 2015 and September 30, 2015 and 500.1 million and 499.0 million, respectively, for the nine months ended September 30, 2016 and the twelve months ended December 31, 2015.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Net Operating Income (Loss) by Segment by Quarter

(amounts in millions, except per share amounts)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total

NET OPERATING INCOME (LOSS):
U.S. Mortgage Insurance segment	$	67		$	61		$	61		$	189		$	41		$	37		$	49		$	52		$	179
Canada Mortgage Insurance segment		36			38			33			107			37			38			37			40			152
Australia Mortgage Insurance segment		14			15			19			48			22			21			29			30			102
U.S. Life Insurance segment:
Long-Term Care Insurance		(270	)		37			34			(199	)		19			(10	)		10			10			29
Life Insurance		48			31			31			110			(173	)		31			22			40			(80	)
Fixed Annuities		15			(13	)		26			28			19			19			25			31			94

Total U.S. Life Insurance segment		(207	)		55			91			(61	)		(135	)		40			57			81			43

Runoff segment		12			6			4			22			11			(4	)		9			11			27
Corporate and Other		(327	)		(52	)		(105	)		(484	)		(58	)		(68	)		(62	)		(60	)		(248	)

NET OPERATING INCOME (LOSS)		(405	)		123			103			(179	)		(82	)		64			119			154			255

ADJUSTMENTS TO NET OPERATING INCOME (LOSS):
Net investment gains (losses), net⁽¹⁾		18			39			(19	)		38			(1	)		(33	)		5			(1	)		(30	)
Gains (losses) on sale of businesses		—			10			(7	)		3			(140	)		—			—			—			(140	)
Gains (losses) on early extinguishment of debt⁽²⁾		—			64			(16	)		48			—			(2	)		—			—			(2	)
Gains (losses) from life block transactions		—			—			(9	)		(9	)		—			(455	)		—			—			(455	)
Expenses related to restructuring		(2	)		(5	)		(15	)		(22	)		(5	)		—			(3	)		—			(8	)
Fees associated with bond consent solicitation		—			—			(18	)		(18	)		—			—			—			—			—
Taxes on adjustments		(6	)		(38	)		53			9			9			163			—			—			172

INCOME (LOSS) FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL INC.’S COMMON STOCKHOLDERS		(395	)		193			72			(130	)		(219	)		(263	)		121			153			(208	)
Add: income from continuing operations attributable to noncontrolling interests		48			48			55			151			52			46			54			50			202

INCOME (LOSS) FROM CONTINUING OPERATIONS		(347	)		241			127			21			(167	)		(217	)		175			203			(6	)
Income (loss) from discontinued operations, net of taxes		15			(21	)		(19	)		(25	)		(73	)		(21	)		(314	)		1			(407	)

NET INCOME (LOSS)		(332	)		220			108			(4	)		(240	)		(238	)		(139	)		204			(413	)
Less: net income attributable to noncontrolling interests		48			48			55			151			52			46			54			50			202

NET INCOME (LOSS) AVAILABLE TO GENWORTH FINANCIAL, INC.’S COMMON STOCKHOLDERS	$	(380	)	$	172		$	53		$	(155	)	$	(292	)	$	(284	)	$	(193	)	$	154		$	(615	)


Earnings (Loss) Per Share Data:
Net income (loss) available to Genworth Financial, Inc.’s common stockholders per common share
Basic	$	(0.76	)	$	0.35		$	0.11		$	(0.31	)	$	(0.59	)	$	(0.57	)	$	(0.39	)	$	0.31		$	(1.24	)
Diluted	$	(0.76	)	$	0.34		$	0.11		$	(0.31	)	$	(0.59	)	$	(0.57	)	$	(0.39	)	$	0.31		$	(1.24	)
Net operating income (loss) per common share
Basic	$	(0.81	)	$	0.25		$	0.21		$	(0.36	)	$	(0.17	)	$	0.13		$	0.24		$	0.31		$	0.51
Diluted	$	(0.81	)	$	0.25		$	0.21		$	(0.36	)	$	(0.17	)	$	0.13		$	0.24		$	0.31		$	0.51
Weighted-average common shares outstanding
Basic		498.3			498.5			498.0			498.3			497.6			497.4			497.4			497.0			497.4
Diluted⁽³⁾		498.3			500.4			499.4			498.3			497.6			497.4			499.3			498.9			497.4

⁽¹⁾	Net investment gains (losses) were adjusted for the portion attributable to noncontrolling interests and DAC and other intangible amortization and certain benefit reserves (see page 46 for reconciliation).

⁽²⁾	For the three months ended September 30, 2015, gains (losses) on early extinguishment of debt were adjusted by $1 million related to the mortgage insurance business in Australia for the portion attributable to noncontrolling interests.

⁽³⁾

Under applicable accounting guidance, companies in a loss position are required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share. Therefore, as a result of the loss from continuing operations, the company was required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share as the inclusion of shares for stock options, restricted stock units and stock appreciation rights of 2.2 million, 1.4 million and 1.3 million, respectively, for the three months ended September 30, 2016, December 31, 2015 and September 30, 2015 and 1.8 million and 1.6 million, respectively, for the nine months ended September 30, 2016 and the twelve months ended December 31, 2015 would have been antidilutive to the calculation. If the company had not incurred a loss from continuing operations in these periods, dilutive potential weighted-average common shares outstanding would have been 500.5 million, 499.0 million and 498.7 million, respectively, for the three months ended September 30, 2016, December 31, 2015 and September 30, 2015 and 500.1 million and 499.0 million, respectively, for the nine months ended September 30, 2016 and the twelve months ended December 31, 2015. Since it had net operating income for the three months ended September 30, 2015 and the twelve months ended December 31, 2015, the company used 498.7 million and 499.0 million, respectively, diluted weighted-average common shares outstanding in the calculation of diluted net operating income per common share.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Consolidated Balance Sheets

(amounts in millions)


	September 30, 2016		June 30, 2016		March 31, 2016		December 31, 2015		September 30, 2015
ASSETS
Investments:
Fixed maturity securities available-for-sale, at fair value	$	63,780	$	62,828	$	60,290	$	58,197	$	60,646
Equity securities available-for-sale, at fair value		590		481		431		310		273
Commercial mortgage loans		6,017		6,121		6,179		6,170		6,133
Restricted commercial mortgage loans related to securitization entities		134		141		155		161		175
Policy loans		1,751		1,754		1,565		1,568		1,567
Other invested assets		2,676		2,510		2,923		2,309		2,764
Restricted other invested assets related to securitization entities		312		312		422		413		412

Total investments		75,260		74,147		71,965		69,128		71,970
Cash and cash equivalents		3,078		3,457		4,043		5,965		3,635
Accrued investment income		677		601		720		653		682
Deferred acquisition costs		3,982		4,046		4,235		4,398		4,441
Intangible assets and goodwill		258		267		291		357		297
Reinsurance recoverable		17,542		17,564		17,587		17,245		17,255
Other assets		570		640		577		520		523
Deferred tax asset		—		—		—		155		—
Separate account assets		7,485		7,484		7,624		7,883		7,893
Assets held for sale⁽¹⁾		—		—		131		127		1,484

Total assets	$	108,852	$	108,206	$	107,173	$	106,431	$	108,180

⁽¹⁾	Assets held for sale related to the lifestyle protection insurance business (prior to its sale on December 1, 2015) and the European mortgage insurance business (prior to its sale on May 9, 2016).

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Consolidated Balance Sheets

(amounts in millions)


	September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			September 30, 2015
LIABILITIES AND EQUITY
Liabilities:
Future policy benefits	$	37,405		$	37,154		$	36,776		$	36,475		$	36,472
Policyholder account balances		25,867			26,182			26,354			26,209			26,000
Liability for policy and contract claims		8,869			8,289			8,177			8,095			8,009
Unearned premiums		3,464			3,412			3,378			3,308			3,281
Other liabilities		3,280			3,197			3,596			3,004			3,225
Borrowings related to securitization entities		78			85			173			179			188
Non-recourse funding obligations		310			310			310			1,920			1,937
Long-term borrowings		4,194			4,191			4,232			4,570			4,573
Deferred tax liability		1,151			893			449			24			200
Separate account liabilities		7,485			7,484			7,624			7,883			7,893
Liabilities held for sale⁽¹⁾		—			—			131			127			986

Total liabilities		92,103			91,197			91,200			91,794			92,764

Equity:
Common stock		1			1			1			1			1
Additional paid-in capital		11,959			11,955			11,952			11,949			11,944

Accumulated other comprehensive income (loss):
Net unrealized investment gains (losses):
Net unrealized gains (losses) on securities not other-than-temporarily impaired		2,836			2,770			2,043			1,236			1,709
Net unrealized gains (losses) on other-than-temporarily impaired securities		24			19			14			18			22

Net unrealized investment gains (losses)		2,860			2,789			2,057			1,254			1,731

Derivatives qualifying as hedges		2,493			2,439			2,302			2,045			2,130
Foreign currency translation and other adjustments		(151	)		(140	)		(174	)		(289	)		(383	)

Total accumulated other comprehensive income		5,202			5,088			4,185			3,010			3,478
Retained earnings		409			789			617			564			856
Treasury stock, at cost		(2,700	)		(2,700	)		(2,700	)		(2,700	)		(2,700	)

Total Genworth Financial, Inc.’s stockholders’ equity		14,871			15,133			14,055			12,824			13,579
Noncontrolling interests		1,878			1,876			1,918			1,813			1,837

Total equity		16,749			17,009			15,973			14,637			15,416

Total liabilities and equity	$	108,852		$	108,206		$	107,173		$	106,431		$	108,180

⁽¹⁾	Liabilities held for sale related to the lifestyle protection insurance business (prior to its sale on December 1, 2015) and the European mortgage insurance business (prior to its sale on May 9, 2016).

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Consolidated Balance Sheet by Segment

(amounts in millions)


	September 30, 2016
	U.S. Mortgage Insurance			Canada Mortgage Insurance			Australia Mortgage Insurance		U.S. Life Insurance		Runoff			Corporate and Other⁽¹⁾			Total
ASSETS
Cash and investments	$	2,582		$	4,796		$	2,731	$	64,157	$	3,003		$	1,746		$	79,015
Deferred acquisition costs and intangible assets		43			140			50		3,746		253			8			4,240
Reinsurance recoverable		2			—			—		16,736		804			—			17,542
Other assets		40			47			13		377		(42	)		135			570
Separate account assets		—			—			—		—		7,485			—			7,485

Total assets	$	2,667		$	4,983		$	2,794	$	85,016	$	11,503		$	1,889		$	108,852

LIABILITIES AND EQUITY
Liabilities:
Future policy benefits	$	—		$	—		$	—	$	37,402	$	3		$	—		$	37,405
Policyholder account balances		—			—			—		22,436		3,431			—			25,867
Liability for policy and contract claims		658			112			215		7,861		16			7			8,869
Unearned premiums		329			1,628			922		579		6			—			3,464
Non-recourse funding obligations		—			—			—		310		—			—			310
Deferred tax and other liabilities		(409	)		140			114		3,531		(65	)		1,120			4,431
Borrowings and capital securities		—			330			150		—		11			3,781			4,272
Separate account liabilities		—			—			—		—		7,485			—			7,485

Total liabilities		578			2,210			1,401		72,119		10,887			4,908			92,103

Equity:
Allocated equity, excluding accumulated other comprehensive income (loss)		2,049			1,716			544		7,713		612			(2,965	)		9,669
Allocated accumulated other comprehensive income (loss)		40			(115	)		143		5,184		4			(54	)		5,202

Total Genworth Financial, Inc.’s stockholders’ equity		2,089			1,601			687		12,897		616			(3,019	)		14,871
Noncontrolling interests		—			1,172			706		—		—			—			1,878

Total equity		2,089			2,773			1,393		12,897		616			(3,019	)		16,749

Total liabilities and equity	$	2,667		$	4,983		$	2,794	$	85,016	$	11,503		$	1,889		$	108,852

⁽¹⁾	Includes inter-segment eliminations and other businesses that are managed outside the operating segments.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Consolidated Balance Sheet by Segment

(amounts in millions)


	June 30, 2016
	U.S. Mortgage Insurance			Canada Mortgage Insurance			Australia Mortgage Insurance		U.S. Life Insurance		Runoff			Corporate and Other⁽¹⁾			Total
ASSETS
Cash and investments	$	2,494		$	4,707		$	2,730	$	62,646	$	2,893		$	2,735		$	78,205
Deferred acquisition costs and intangible assets		39			137			52		3,818		260			7			4,313
Reinsurance recoverable		2			—			—		16,744		818			—			17,564
Other assets		41			47			17		369		10			156			640
Separate account assets		—			—			—		—		7,484			—			7,484

Total assets	$	2,576		$	4,891		$	2,799	$	83,577	$	11,465		$	2,898		$	108,206

LIABILITIES AND EQUITY
Liabilities:
Future policy benefits	$	—		$	—		$	—	$	37,151	$	3		$	—		$	37,154
Policyholder account balances		—			—			—		22,709		3,473			—			26,182
Liability for policy and contract claims		707			104			190		7,264		16			8			8,289
Unearned premiums		304			1,598			926		578		6			—			3,412
Non-recourse funding obligations		—			—			—		310		—			—			310
Deferred tax and other liabilities		(450	)		103			117		3,697		(85	)		708			4,090
Borrowings and capital securities		—			333			145		—		11			3,787			4,276
Separate account liabilities		—			—			—		—		7,484			—			7,484

Total liabilities		561			2,138			1,378		71,709		10,908			4,503			91,197

Equity:
Allocated equity, excluding accumulated other comprehensive income (loss)		1,975			1,691			578		6,770		554			(1,523	)		10,045
Allocated accumulated other comprehensive income (loss)		40			(99	)		128		5,098		3			(82	)		5,088

Total Genworth Financial, Inc.’s stockholders’ equity		2,015			1,592			706		11,868		557			(1,605	)		15,133
Noncontrolling interests		—			1,161			715		—		—			—			1,876

Total equity		2,015			2,753			1,421		11,868		557			(1,605	)		17,009

Total liabilities and equity	$	2,576		$	4,891		$	2,799	$	83,577	$	11,465		$	2,898		$	108,206

⁽¹⁾	Includes inter-segment eliminations and other businesses that are managed outside the operating segments.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Deferred Acquisition Costs Rollforward

(amounts in millions)


	U.S. Mortgage Insurance			Canada Mortgage Insurance			Australia Mortgage Insurance			U.S. Life Insurance⁽¹⁾			Runoff			Corporate and Other		Total
Unamortized balance as of June 30, 2016	$	25		$	120		$	34		$	4,057		$	255		$	—	$	4,491
Costs deferred		5			13			2			12			1			—		33
Amortization, net of interest accretion		(3	)		(9	)		(3	)		(58	)		(7	)		—		(80	)
Impact of foreign currency translation		—			(1	)		1			—			—			—		—

Unamortized balance as of September 30, 2016		27			123			34			4,011			249			—		4,444
Effect of accumulated net unrealized investment (gains) losses		—			—			—			(453	)		(9	)		—		(462	)

Balance as of September 30, 2016	$	27		$	123		$	34		$	3,558		$	240		$	—	$	3,982

⁽¹⁾	Amortization, net of interest accretion, included $1 million of amortization related to net investment gains for the policyholder account balances.

U.S. Mortgage Insurance Segment

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Net Operating Income and Sales—U.S. Mortgage Insurance Segment

(amounts in millions)


	2016										2015
	3Q		2Q		1Q			Total			4Q		3Q			2Q		1Q		Total
REVENUES:
Premiums	$	169	$	160	$	160		$	489		$	153	$	146		$	153	$	150	$	602
Net investment income		16		15		15			46			14		12			13		19		58
Net investment gains (losses)		—		—		(1	)		(1	)		—		1			—		—		1
Policy fees and other income		1		1		1			3			1		2			—		1		4

Total revenues		186		176		175			537			168		161			166		170		665

BENEFITS AND EXPENSES:
Benefits and other changes in policy reserves		36		38		38			112			59		63			50		50		222
Acquisition and operating expenses, net of deferrals		45		41		39			125			42		38			38		37		155
Amortization of deferred acquisition costs and intangibles		3		2		3			8			3		3			2		2		10

Total benefits and expenses		84		81		80			245			104		104			90		89		387

INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		102		95		95			292			64		57			76		81		278
Provision for income taxes		36		34		34			104			23		20			27		29		99

INCOME FROM CONTINUING OPERATIONS		66		61		61			188			41		37			49		52		179
ADJUSTMENTS TO INCOME FROM CONTINUING OPERATIONS:
Net investment (gains) losses		—		—		1			1			—		(1	)		—		—		(1	)
Expenses related to restructuring		1		—		—			1			—		—			—		—		—
Taxes on adjustments		—		—		(1	)		(1	)		—		1			—		—		1

NET OPERATING INCOME	$	67	$	61	$	61		$	189		$	41	$	37		$	49	$	52	$	179



SALES:
New Insurance Written (NIW)
Flow	$	12,800	$	11,400	$	7,400		$	31,600		$	7,800	$	9,300		$	8,200	$	6,300	$	31,600
Bulk		—		—		—			—			—		—			—		—		—

Total U.S. Mortgage Insurance NIW	$	12,800	$	11,400	$	7,400		$	31,600		$	7,800	$	9,300		$	8,200	$	6,300	$	31,600

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Flow New Insurance Written Metrics—U.S. Mortgage Insurance Segment

(amounts in millions)


	2016															2015
	3Q					2Q					1Q					4Q					3Q					2Q					1Q
	Flow NIW		Premium Rate (bps)			Flow NIW		Premium Rate (bps)			Flow NIW		Premium Rate (bps)			Flow NIW		Premium Rate (bps)			Flow NIW		Premium Rate (bps)			Flow NIW		Premium Rate (bps)			Flow NIW		Premium Rate (bps)
Product
Monthly⁽¹⁾	$	10,000		54		$	8,400		55		$	5,400		59		$	5,900		60		$	7,000		60		$	6,500		60		$	4,400		60
Single		2,800		167			3,000		161			2,000		164			1,900		168			2,300		171			1,700		172			1,900		160

Total Flow	$	12,800				$	11,400				$	7,400				$	7,800				$	9,300				$	8,200				$	6,300


	Flow NIW		% of Flow NIW			Flow NIW		% of Flow NIW			Flow NIW		% of Flow NIW			Flow NIW		% of Flow NIW			Flow NIW		% of Flow NIW			Flow NIW		% of Flow NIW			Flow NIW		% of Flow NIW
FICO Scores
Over 735	$	8,100		63	%	$	7,100		62	%	$	4,400		60	%	$	4,600		59	%	$	5,500		59	%	$	5,000		61	%	$	3,700		59	%
680-735		3,800		30			3,400		30			2,400		32			2,500		32			3,000		32			2,500		30			2,100		33
660-679⁽²⁾		500		4			500		4			300		4			400		5			500		6			400		5			300		5
620-659		400		3			400		4			300		4			300		4			300		3			300		4			200		3
<620		—		—			—		—			—		—			—		—			—		—			—		—			—		—

Total Flow	$	12,800		100	%	$	11,400		100	%	$	7,400		100	%	$	7,800		100	%	$	9,300		100	%	$	8,200		100	%	$	6,300		100	%

Loan-To-Value Ratio
95.01% and above	$	1,000		8	%	$	700		6	%	$	400		5	%	$	400		5	%	$	500		5	%	$	400		5	%	$	300		5	%
90.01% to 95.00%		6,100		48			5,900		52			3,700		50			4,000		51			4,900		53			4,200		51			3,100		49
85.01% to 90.00%		4,000		31			3,400		30			2,400		33			2,500		32			3,000		32			2,600		32			2,000		32
85.00% and below		1,700		13			1,400		12			900		12			900		12			900		10			1,000		12			900		14

Total Flow	$	12,800		100	%	$	11,400		100	%	$	7,400		100	%	$	7,800		100	%	$	9,300		100	%	$	8,200		100	%	$	6,300		100	%

Origination
Purchase	$	10,500		82	%	$	9,400		82	%	$	6,000		81	%	$	6,500		83	%	$	8,100		87	%	$	6,500		79	%	$	4,300		68	%
Refinance		2,300		18			2,000		18			1,400		19			1,300		17			1,200		13			1,700		21			2,000		32

Total Flow	$	12,800		100	%	$	11,400		100	%	$	7,400		100	%	$	7,800		100	%	$	9,300		100	%	$	8,200		100	%	$	6,300		100	%

⁽¹⁾	Includes loans with annual and split payment types.

⁽²⁾	Loans with unknown FICO scores are included in the 660-679 category.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Other Metrics—U.S. Mortgage Insurance Segment

(dollar amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
Net Premiums Written	$	193		$	190		$	176		$	559		$	171		$	171		$	170		$	170		$	682

New Risk Written
Flow	$	3,188		$	2,865		$	1,845		$	7,898		$	1,964		$	2,364		$	2,040		$	1,557		$	7,925
Bulk		—			—			—			—			—			—			—			—			—

Total Primary		3,188			2,865			1,845			7,898			1,964			2,364			2,040			1,557			7,925
Pool		—			—			—			—			—			—			—			—			—

Total New Risk Written	$	3,188		$	2,865		$	1,845		$	7,898		$	1,964		$	2,364		$	2,040		$	1,557		$	7,925


Primary Insurance In-Force⁽¹⁾	$	133,700		$	128,400		$	124,100					$	122,400		$	120,400		$	117,100		$	115,200

Risk In-Force
Flow⁽²⁾	$	32,067		$	30,760		$	29,620					$	29,142		$	28,563		$	27,623		$	27,025
Bulk⁽³⁾		290			314			318						326			349			360			387

Total Primary		32,357			31,074			29,938						29,468			28,912			27,983			27,412
Pool		104			111			116						120			129			137			142

Total Risk In-Force	$	32,461		$	31,185		$	30,054					$	29,588		$	29,041		$	28,120		$	27,554


Primary Risk In-Force That Is GSE Conforming		96	%		96	%		96	%					96	%		97	%		97	%		97	%

Expense Ratio (Net Earned Premiums)⁽⁴⁾		28	%		27	%		26	%		27	%		29	%		28	%		26	%		26	%		27	%

Expense Ratio (Net Premiums Written)⁽⁵⁾		24	%		23	%		24	%		24	%		26	%		24	%		23	%		23	%		24	%

Flow Persistency		77	%		77	%		82	%					81	%		80	%		79	%		81	%

Risk To Capital Ratio⁽⁶⁾		15.0:1			15.0:1			15.3:1						16.3:1			14.3:1			13.7:1			14.1:1

PMIERs Sufficiency Ratio⁽⁷⁾		117	%		115	%		113	%					109	%		NA			NA			NA

Average Primary Loan Size (in thousands)	$	195		$	192		$	189					$	188		$	186		$	184		$	182

The expense ratios included above were calculated using whole dollars and may be different than the ratios calculated using the rounded numbers included herein.

⁽¹⁾

Primary insurance in-force represents aggregate loan balances for outstanding insurance policies and is used to determine premiums. Original loan balances are presented for policies with level renewal premiums. Amortized loan balances are presented for policies with annual, amortizing renewal premiums.

⁽²⁾	Flow risk in-force represents current loan balances as provided by servicers, lenders and investors and conform to the presentation under the Private Mortgage Insurer Eligibility Requirements (PMIERs).

⁽³⁾	As of September 30, 2016, 89% of the bulk risk in-force was related to loans financed by lenders who participated in the mortgage programs sponsored by the Federal Home Loan Banks.

⁽⁴⁾	The ratio of an insurer’s general expenses to net earned premiums. In the business, general expenses consist of acquisition and operating expenses, net of deferrals, and amortization of DAC and intangibles.

⁽⁵⁾	The ratio of an insurer’s general expenses to net premiums written. In the business, general expenses consist of acquisition and operating expenses, net of deferrals, and amortization of DAC and intangibles.

⁽⁶⁾

Certain states limit a private mortgage insurer’s risk in-force to 25 times the total of the insurer’s policyholders’ surplus plus the statutory contingency reserve, commonly known as the “risk to capital” requirement. The current period risk to capital ratio is an estimate due to the timing of the filing of statutory statements and is prepared consistent with the presentation of the statutory financial statements in the combined annual statement of the U.S. mortgage insurance business.

⁽⁷⁾

PMIERs became effective December 31, 2015. The PMIERs sufficiency ratio is calculated as available assets divided by required assets as defined within PMIERs. The current period PMIERs sufficiency ratio is an estimate due to the timing of the PMIERs filing for the U.S. mortgage insurance business. As of September 30, 2016, June 30, 2016, March 31, 2016 and December 31, 2015, the PMIERs sufficiency ratios were in excess of $400 million, $350 million, $300 million and $200 million, respectively, of available assets above the PMIERs requirements.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Loss Metrics—U.S. Mortgage Insurance Segment

(dollar amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
Paid Claims
Flow
Direct⁽¹⁾	$	80		$	94		$	112		$	286		$	158		$	98		$	131		$	130		$	517
Assumed⁽²⁾		1			1			2			4			1			3			4			5			13
Ceded		—			(1	)		(3	)		(4	)		(1	)		—			(1	)		(16	)		(18	)
Loss adjustment expenses		2			3			3			8			3			3			3			4			13

Total Flow		83			97			114			294			161			104			137			123			525
Bulk		1			1			2			4			1			1			2			2			6

Total Primary		84			98			116			298			162			105			139			125			531
Pool		—			1			—			1			1			—			1			1			3

Total Paid Claims	$	84		$	99		$	116		$	299		$	163		$	105		$	140		$	126		$	534


Average Paid Claim (in thousands)⁽³⁾	$	53.6		$	50.8		$	51.9					$	63.6		$	54.0		$	50.8		$	46.5

Average Reserve Per Delinquency (in thousands)
Flow	$	25.9		$	27.8		$	28.3					$	27.2		$	29.4		$	30.6		$	31.0
Bulk loans with established reserve		18.8			21.1			21.2						19.9			20.0			21.5			21.2

Reserves:
Flow direct case	$	599		$	640		$	698					$	775		$	870		$	909		$	992
Bulk direct case		14			14			15						17			17			18			20
Assumed⁽²⁾		6			6			7						8			9			12			15
All other⁽⁴⁾		39			47			48						49			57			57			60

Total Reserves	$	658		$	707		$	768					$	849		$	953		$	996		$	1,087


Beginning Reserves	$	707		$	768		$	849		$	849		$	953		$	996		$	1,087		$	1,180		$	1,180
Paid claims⁽¹⁾		(84	)		(99	)		(119	)		(302	)		(164	)		(105	)		(141	)		(142	)		(552	)
Increase in reserves		35			38			38			111			60			62			50			49			221

Ending Reserves	$	658		$	707		$	768		$	658		$	849		$	953		$	996		$	1,087		$	849


Beginning Reinsurance Recoverable⁽⁵⁾	$	2		$	2		$	5		$	5		$	6		$	6		$	7		$	24		$	24
Ceded paid claims		—			—			(3	)		(3	)		(1	)		—			(1	)		(16	)		(18	)
Decrease in recoverable		—			—			—			—			—			—			—			(1	)		(1	)

Ending Reinsurance Recoverable	$	2		$	2		$	2		$	2		$	5		$	6		$	6		$	7		$	5

Loss Ratio⁽⁶⁾		21	%		24	%		24	%		23	%		39	%		43	%		33	%		33	%		37	%

The loss ratio included above was calculated using whole dollars and may be different than the ratio calculated using the rounded numbers included herein.

⁽¹⁾	Direct paid claims and paid claims in the fourth quarter of 2015 included payment of a previously disclosed negotiated servicer settlement reached in 2014 and payment in relation to an agreement on non-performing loans.

⁽²⁾	Assumed is comprised of reinsurance arrangements with state governmental housing finance agencies.

⁽³⁾	Average paid claim in the fourth quarter of 2015 reflected the non-recurring payment to extinguish the risk on prior paid claims pursuant to a previously disclosed servicer settlement reached in 2014.

⁽⁴⁾	Other includes loss adjustment expenses, pool and incurred but not reported reserves.

⁽⁵⁾	Reinsurance recoverable excludes ceded unearned premium recoveries and amounts for which cash proceeds have not yet been received.

⁽⁶⁾	The ratio of incurred losses and loss adjustment expenses to net earned premiums.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Delinquency Metrics—U.S. Mortgage Insurance Segment

(dollar amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
Number of Primary Delinquencies
Flow		24,720			24,753			26,491						30,416			31,678			31,876			34,220
Bulk loans with an established reserve		778			732			776						889			917			908			984
Bulk loans with no reserve⁽¹⁾		305			313			335						358			394			415			461

Total Number of Primary Delinquencies		25,803			25,798			27,602						31,663			32,989			33,199			35,665


Beginning Number of Primary Delinquencies		25,798			27,602			31,663			31,663			32,989			33,199			35,665			39,786			39,786
New delinquencies		9,609			8,265			8,761			26,635			10,043			10,192			9,061			9,554			38,850
Delinquency cures		(8,043	)		(8,137	)		(10,602	)		(26,782	)		(8,835	)		(8,484	)		(8,800	)		(10,988	)		(37,107	)
Paid claims		(1,561	)		(1,932	)		(2,220	)		(5,713	)		(2,534	)		(1,918	)		(2,727	)		(2,687	)		(9,866	)

Ending Number of Primary Delinquencies		25,803			25,798			27,602			25,803			31,663			32,989			33,199			35,665			31,663


Composition of Cures
Reported delinquent and cured-intraquarter		1,798			1,597			2,503						1,740			1,805			1,658			2,271
Number of missed payments delinquent prior to cure:
3 payments or less		4,276			4,335			5,775						5,005			4,630			4,260			6,112
4 - 11 payments		1,413			1,577			1,443						1,330			1,487			2,250			1,912
12 payments or more		556			628			881						760			562			632			693

Total		8,043			8,137			10,602						8,835			8,484			8,800			10,988


Primary Delinquencies by Missed Payment Status
3 payments or less		9,405			8,529			8,395						10,487			10,226			9,432			9,271
4 - 11 payments		6,212			6,323			7,254						7,577			7,376			7,824			9,086
12 payments or more		10,186			10,946			11,953						13,599			15,387			15,943			17,308

Primary Delinquencies		25,803			25,798			27,602						31,663			32,989			33,199			35,665




	September 30, 2016
Flow Delinquencies and Percentage Reserved by Payment Status	Delinquencies			Direct Case Reserves⁽²⁾			Risk In-Force			Reserves as % of Risk In-Force
3 payments or less in default		9,048		$	45		$	371			12	%
4 - 11 payments in default		6,053			144			252			57	%
12 payments or more in default		9,619			410			466			88	%

Total		24,720		$	599		$	1,089			55	%


	December 31, 2015
Flow Delinquencies and Percentage Reserved by Payment Status	Delinquencies			Direct Case Reserves⁽²⁾			Risk In-Force			Reserves as % of Risk In-Force
3 payments or less in default		10,103		$	52		$	405			13	%
4 - 11 payments in default		7,366			180			307			59	%
12 payments or more in default		12,947			543			638			85	%

Total		30,416		$	775		$	1,350			57	%

⁽¹⁾	Reserves were not established on loans where the company was in a secondary loss position due to an existing deductible and the company believes currently have no risk for claim.

⁽²⁾	Direct flow case reserves exclude loss adjustment expenses, incurred but not reported and reinsurance reserves.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Portfolio Quality Metrics—U.S. Mortgage Insurance Segment


	2016									2015
	3Q			2Q			1Q			4Q			3Q			2Q			1Q
Primary Loans
Primary loans in-force		686,789			668,951			655,300			651,668			647,126			636,640			631,591
Primary delinquent loans		25,803			25,798			27,602			31,663			32,989			33,199			35,665
Primary delinquency rate		3.76	%		3.86	%		4.21	%		4.86	%		5.10	%		5.21	%		5.65	%

Flow loans in-force		665,821			647,100			632,010			627,349			620,430			608,615			601,472
Flow delinquent loans		24,720			24,753			26,491			30,416			31,678			31,876			34,220
Flow delinquency rate		3.71	%		3.83	%		4.19	%		4.85	%		5.11	%		5.24	%		5.69	%

Bulk loans in-force		20,968			21,851			23,290			24,319			26,696			28,025			30,119
Bulk delinquent loans		1,083			1,045			1,111			1,247			1,311			1,323			1,445
Bulk delinquency rate		5.17	%		4.78	%		4.77	%		5.13	%		4.91	%		4.72	%		4.80	%

A minus and sub-prime loans in-force		24,281			25,552			26,995			28,332			29,745			31,051			33,805
A minus and sub-prime delinquent loans		5,306			5,220			5,546			6,448			6,642			6,530			7,019
A minus and sub-prime delinquency rate		21.85	%		20.43	%		20.54	%		22.76	%		22.33	%		21.03	%		20.76	%

Pool Loans
Pool loans in-force		5,896			6,196			6,406			6,620			7,284			7,709			7,979
Pool delinquent loans		343			356			369			386			426			447			468
Pool delinquency rate		5.82	%		5.75	%		5.76	%		5.83	%		5.85	%		5.80	%		5.87	%

Primary Risk In-Force by Credit Quality
Over 735		55	%		54	%		53	%		53	%		52	%		52	%		52	%
680-735		31	%		32	%		32	%		31	%		31	%		31	%		31	%
660-679⁽¹⁾		6	%		6	%		6	%		7	%		7	%		7	%		7	%
620-659		6	%		6	%		7	%		7	%		7	%		7	%		7	%
< 620		2	%		2	%		2	%		2	%		3	%		3	%		3	%

⁽¹⁾	Loans with unknown FICO scores are included in the 660-679 category.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Portfolio Quality Metrics—U.S. Mortgage Insurance Segment

(dollar amounts in millions)


	September 30, 2016
Policy Year	Average Rate⁽¹⁾			% of Total Reserves⁽²⁾			Primary Insurance In-Force		% of Total			Primary Risk In-Force		% of Total			Deliquency Rate
2004 and prior		6.02	%		11.6	%	$	3,205		2.4	%	$	627		1.9	%		13.75	%
2005		5.63	%		11.2			2,887		2.2			697		2.2			12.97	%
2006		5.79	%		17.0			4,992		3.7			1,177		3.6			12.76	%
2007		5.71	%		35.3			12,757		9.5			3,001		9.3			11.61	%
2008		5.26	%		16.5			10,891		8.2			2,555		7.9			6.40	%
2009		4.95	%		0.8			1,350		1.0			290		0.9			2.44	%
2010		4.68	%		0.7			1,755		1.3			401		1.2			1.74	%
2011		4.53	%		0.7			2,430		1.8			580		1.8			1.60	%
2012		3.84	%		0.8			6,432		4.8			1,567		4.8			0.78	%
2013		4.03	%		1.4			11,409		8.5			2,795		8.6			0.74	%
2014		4.41	%		2.3			16,562		12.4			4,063		12.6			0.86	%
2015		4.10	%		1.5			28,053		21.0			6,911		21.4			0.43	%
2016		3.91	%		0.2			31,007		23.2			7,693		23.8			0.07	%

Total		4.59	%		100.0	%	$	133,730		100.0	%	$	32,357		100.0	%		3.76	%


	September 30, 2016						June 30, 2016					September 30, 2015
	Primary Risk In-Force			Primary Delinquency Rate			Primary Risk In-Force		Primary Delinquency Rate			Primary Risk In-Force⁽³⁾		Primary Delinquency Rate
Lender concentration (by original applicant)	$	32,357			3.76	%	$	31,074		3.86	%	$	28,912		5.10	%
Top 10 lenders		10,538			4.63	%		10,533		4.71	%		11,156		6.68	%
Top 20 lenders		13,696			4.56	%		13,532		4.67	%		13,539		5.91	%

Loan-to-value ratio
95.01% and above	$	5,685			6.92	%	$	5,682		6.80	%	$	6,002		8.15	%
90.01% to 95.00%		16,168			2.55	%		15,247		2.62	%		13,270		3.66	%
80.01% to 90.00%		10,235			3.41	%		9,858		3.60	%		9,326		4.85	%
80.00% and below		269			3.19	%		287		3.19	%		314		3.44	%

Total	$	32,357			3.76	%	$	31,074		3.86	%	$	28,912		5.10	%

Loan grade
Prime	$	31,503			3.09	%	$	30,175		3.20	%	$	27,866		4.27	%
A minus and sub-prime		854			21.85	%		899		20.43	%		1,046		22.33	%

Total	$	32,357			3.76	%	$	31,074		3.86	%	$	28,912		5.10	%

⁽¹⁾	Average Annual Mortgage Interest Rate.

⁽²⁾	Total reserves were $658 million as of September 30, 2016.

⁽³⁾

Beginning in the second quarter of 2016, all flow risk in-force metrics are based upon more current loan balances as provided by servicers, lenders and investors and conform to the presentation under PMIERs. Previously, certain flow risk in-force metrics were based on original loan balances when current loan balances were not available. The prior period has been re-presented to reflect these modified metrics.

Canada Mortgage Insurance Segment

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Net Operating Income and Sales—Canada Mortgage Insurance Segment

(amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
REVENUES:
Premiums	$	124		$	122		$	111		$	357		$	115		$	116		$	116		$	119		$	466
Net investment income		33			32			29			94			31			32			33			34			130
Net investment gains (losses)		—			(8	)		20			12			(11	)		(23	)		20			(18	)		(32	)
Policy fees and other income		(1	)		1			—			—			—			(1	)		—			1			—

Total revenues		156			147			160			463			135			124			169			136			564

BENEFITS AND EXPENSES:
Benefits and other changes in policy reserves		30			25			26			81			26			24			21			25			96
Acquisition and operating expenses, net of deferrals		21			19			18			58			16			16			22			12			66
Amortization of deferred acquisition costs and intangibles		10			10			9			29			9			9			9			9			36
Interest expense		5			4			4			13			4			5			4			5			18

Total benefits and expenses		66			58			57			181			55			54			56			51			216

INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		90			89			103			282			80			70			113			85			348
Provision for income taxes		24			23			29			76			20			17			31			22			90

INCOME FROM CONTINUING OPERATIONS		66			66			74			206			60			53			82			63			258
Less: income from continuing operations attributable to noncontrolling interests		30			30			34			94			27			24			38			29			118

INCOME FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL, INC.’S COMMON STOCKHOLDERS		36			36			40			112			33			29			44			34			140

ADJUSTMENTS TO INCOME FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL, INC.’S COMMON STOCKHOLDERS:
Net investment (gains) losses, net⁽¹⁾		—			4			(11	)		(7	)		7			13			(11	)		10			19
Taxes on adjustments		—			(2	)		4			2			(3	)		(4	)		4			(4	)		(7	)

NET OPERATING INCOME⁽²⁾	$	36		$	38		$	33		$	107		$	37		$	38		$	37		$	40		$	152



SALES:
New Insurance Written (NIW)
Flow	$	5,300		$	4,400		$	2,500		$	12,200		$	4,700		$	6,600		$	5,400		$	3,300		$	20,000
Bulk		5,100			19,700			3,200			28,000			7,300			4,800			3,300			5,000			20,400

Total Canada NIW⁽³⁾	$	10,400		$	24,100		$	5,700		$	40,200		$	12,000		$	11,400		$	8,700		$	8,300		$	40,400

⁽¹⁾	Net investment (gains) losses were adjusted for the portion of net investment gains (losses) attributable to noncontrolling interests as reconciled below:


Net investment (gains) losses, gross	$	—	$	8		$	(20	)	$	(12	)	$	11		$	23		$	(20	)	$	18		$	32
Adjustment for net investment gains (losses) attributable to noncontrolling interests		—		(4	)		9			5			(4	)		(10	)		9			(8	)		(13	)

Net investment (gains) losses, net	$	—	$	4		$	(11	)	$	(7	)	$	7		$	13		$	(11	)	$	10		$	19

⁽²⁾	Net operating income for the Canadian platform adjusted for foreign exchange as compared to the prior year period was $36 million and $115 million for the three and nine months ended September 30, 2016, respectively.

⁽³⁾	New insurance written for the Canadian platform adjusted for foreign exchange as compared to the prior year period was $10,600 million and $42,500 million for the three and nine months ended September 30, 2016, respectively.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Selected Key Performance Measures—Canada Mortgage Insurance Segment

(amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
Net Premiums Written	$	172		$	191		$	84		$	447		$	162		$	204		$	166		$	109		$	641
Loss Ratio⁽¹⁾		24	%		20	%		24	%		23	%		23	%		21	%		17	%		22	%		21	%
Expense Ratio (Net Earned Premiums)⁽²⁾		24	%		24	%		24	%		24	%		22	%		22	%		27	%		18	%		22	%
Expense Ratio (Net Premiums Written)⁽³⁾		18	%		15	%		32	%		19	%		15	%		12	%		19	%		20	%		16	%

Primary Insurance In-Force⁽⁴⁾	$	347,300		$	341,600		$	317,400					$	292,600		$	292,000		$	300,900		$	288,800
Primary Risk In-Force⁽⁵⁾
Flow	$	82,300		$	81,400		$	79,900					$	74,300		$	75,500		$	78,500		$	75,700
Bulk		39,200			38,100			31,200						28,100			26,700			26,800			25,400

Total	$	121,500		$	119,500		$	111,100					$	102,400		$	102,200		$	105,300		$	101,100



	September 30, 2016									June 30, 2016
Risk In-Force by Loan-To-Value Ratio⁽⁶⁾	Primary			Flow			Bulk			Primary			Flow			Bulk
95.01% and above	$	39,938		$	39,938		$	—		$	39,332		$	39,332		$	—
90.01% to 95.00%		24,616			24,616			—			24,401			24,401			—
80.01% to 90.00%		14,787			14,784			3			14,756			14,753			3
80.00% and below		42,198			2,973			39,225			41,058			2,960			38,098

Total	$	121,539		$	82,311		$	39,228		$	119,547		$	81,446		$	38,101

The loss and expense ratios included above were calculated using whole dollars and may be different than the ratios calculated using the rounded numbers included herein.

Amounts may not total due to rounding.

⁽¹⁾	The ratio of incurred losses and loss adjustment expenses to net earned premiums.

⁽²⁾	The ratio of an insurer’s general expenses to net earned premiums. In the business, general expenses consist of acquisition and operating expenses, net of deferrals, and amortization of DAC and intangibles.

⁽³⁾	The ratio of an insurer’s general expenses to net premiums written. In the business, general expenses consist of acquisition and operating expenses, net of deferrals, and amortization of DAC and intangibles.

⁽⁴⁾

As part of an ongoing effort to improve the estimate of outstanding insurance exposure, the company is receiving updated outstanding balances in Canada from most of its customers on a quarter lag. As a result, the company estimates that the outstanding balance of insured mortgages was approximately $170.0 billion, $152.0 billion, $139.0 billion, $138.0 billion, $142.0 billion and $137.0 billion as of June 30, 2016, March 31, 2016, December 31, 2015, September 30, 2015, June 30, 2015 and March 31, 2015, respectively. This is based on the extrapolation of the amounts reported by lenders to the entire insured population.

⁽⁵⁾

The business currently provides 100% coverage on the majority of the loans the company insures. For the purpose of representing the risk in-force, Canada has computed an “effective risk in-force” amount which recognizes that the loss on any particular loan will be reduced by the net proceeds received upon sale of the property. Effective risk in-force has been calculated by applying to insurance in-force a factor that represents the highest expected average per-claim payment for any one underwriting year over the life of the business. This factor was 35% for all periods presented.

⁽⁶⁾	Loan amount in loan-to-value ratio calculation includes capitalized premiums, where applicable.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Selected Key Performance Measures—Canada Mortgage Insurance Segment

(dollar amounts in millions)


Primary Insurance	September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			September 30, 2015
Insured loans in-force^(1),(2)		2,006,484			1,968,171			1,860,978			1,835,916			1,785,541
Insured delinquent loans		2,027			1,961			2,034			1,829			1,715
Insured delinquency rate^(2),(3)		0.10	%		0.10	%		0.11	%		0.10	%		0.10	%

Flow loans in-force⁽¹⁾		1,379,020			1,358,927			1,341,636			1,331,773			1,313,034
Flow delinquent loans		1,715			1,669			1,711			1,550			1,449
Flow delinquency rate⁽³⁾		0.12	%		0.12	%		0.13	%		0.12	%		0.11	%

Bulk loans in-force⁽¹⁾		627,464			609,244			519,342			504,143			472,507
Bulk delinquent loans		312			292			323			279			266
Bulk delinquency rate⁽³⁾		0.05	%		0.05	%		0.06	%		0.06	%		0.06	%

Loss Metrics	September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			September 30, 2015
Beginning Reserves	$	104		$	102		$	87		$	83		$	85
Paid claims⁽⁴⁾		(20	)		(21	)		(18	)		(18	)		(20	)
Increase in reserves		29			23			26			25			23
Impact of changes in foreign exchange rates		(1	)		—			7			(3	)		(5	)

Ending Reserves	$	112		$	104		$	102		$	87		$	83


	September 30, 2016						June 30, 2016						September 30, 2015
Province and Territory	% of Primary Risk In-Force			Primary Delinquency Rate			% of Primary Risk In-Force			Primary Delinquency Rate			% of Primary Risk In-Force			Primary Delinquency Rate
Ontario		46	%		0.04	%		47	%		0.04	%		46	%		0.05	%
Alberta		16			0.22	%		16			0.17	%		17			0.10	%
British Columbia		15			0.07	%		15			0.07	%		14			0.10	%
Quebec		13			0.15	%		13			0.17	%		13			0.18	%
Saskatchewan		3			0.27	%		3			0.25	%		3			0.15	%
Nova Scotia		2			0.20	%		2			0.20	%		2			0.20	%
Manitoba		2			0.08	%		2			0.09	%		2			0.08	%
New Brunswick		1			0.15	%		1			0.18	%		1			0.19	%
All Other		2			0.14	%		1			0.12	%		2			0.11	%

Total		100	%		0.10	%		100	%		0.10	%		100	%		0.10	%


By Policy Year
2007 and prior		30	%		0.04	%		31	%		0.04	%		37	%		0.04	%
2008		4			0.16	%		6			0.19	%		6			0.17	%
2009		4			0.16	%		4			0.17	%		4			0.15	%
2010		6			0.19	%		6			0.20	%		7			0.21	%
2011		6			0.27	%		6			0.26	%		7			0.25	%
2012		7			0.21	%		8			0.21	%		9			0.21	%
2013		8			0.19	%		8			0.18	%		9			0.13	%
2014		9			0.17	%		9			0.15	%		11			0.06	%
2015		13			0.06	%		13			0.03	%		10			—	%
2016		13			0.01	%		9			—	%		—			—	%

Total		100	%		0.10	%		100	%		0.10	%		100	%		0.10	%

⁽¹⁾	Insured loans in-force represent the original number of loans insured for which the coverage term has not expired, and for which no policy level cancellation or termination has been received.

⁽²⁾

As part of an ongoing effort to improve the estimate of outstanding insurance exposure, the company is receiving updated outstanding loans in-force in Canada from most of its customers on a quarter lag. As a result, the company estimates that the outstanding loans in-force were 968,000 as of June 30, 2016, 883,000 as of March 31, 2016, 870,000 as of December 31, 2015, 836,000 as of September 30, 2015 and 828,000 as of June 30, 2015. This is based on the extrapolation of the amounts reported by lenders to the entire insured population. The corresponding insured delinquency rate was 0.20% as of June 30, 2016, 0.23% as of March 31, 2016, 0.21% as of December 31, 2015 and September 30, 2015 and 0.20% as of June 30, 2015.

⁽³⁾	Delinquency rates are based on insured loans in-force.

⁽⁴⁾	Paid claims exclude adjustments for expected recoveries related to loss reserves and prior paid claims.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Selected Key Performance Measures—Canada Mortgage Insurance Segment

(Canadian dollar amounts in millions)


	2016											2015
	3Q			2Q			1Q			Total		4Q			3Q			2Q			1Q			Total
Paid Claims⁽¹⁾
Flow	$	26		$	25		$	24		$	75	$	23		$	25		$	25		$	25		$	98
Bulk		1			2			1			4		1			1			1			2			5

Total Paid Claims	$	27		$	27		$	25		$	79	$	24		$	26		$	26		$	27		$	103


Average Paid Claim (in thousands)	$	62.0		$	62.5		$	67.8				$	63.7		$	66.2		$	58.7		$	67.9

Average Reserve Per Delinquency (in thousands)	$	72.8		$	69.1		$	65.0				$	65.7		$	64.2		$	63.6		$	60.4

Loss Metrics

Beginning Reserves	$	136		$	132		$	120				$	110		$	106		$	108		$	106
Paid claims⁽¹⁾		(27	)		(27	)		(25	)				(24	)		(26	)		(26	)		(27	)
Increase in reserves		39			31			37					34			30			24			29

Ending Reserves	$	148		$	136		$	132				$	120		$	110		$	106		$	108

Loan Amount⁽²⁾

Over $550K		8	%		8	%		7	%				7	%		7	%		6	%		6	%
$400K to $550K		14			14			13					13			12			12			12
$250K to $400K		33			34			34					33			33			33			33
$100K to $250K		41			40			42					43			44			44			44
$100K or Less		4			4			4					4			4			5			5

Total		100	%		100	%		100	%				100	%		100	%		100	%		100	%


Average Primary Loan Size (in thousands)	$	227		$	225		$	222				$	221		$	218		$	216		$	215

All amounts presented in Canadian dollars.

⁽¹⁾	Paid claims exclude adjustments for expected recoveries related to loss reserves and prior paid claims.

⁽²⁾	The percentages in this table are based on the amount of primary insurance in-force in each loan band as a percentage of total insurance in-force.

Australia Mortgage Insurance Segment

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Net Operating Income and Sales—Australia Mortgage Insurance Segment

(amounts in millions)


	2016											2015
	3Q			2Q			1Q		Total			4Q			3Q			2Q		1Q			Total
REVENUES:
Premiums	$	88		$	86		$	81	$	255		$	86		$	92		$	90	$	89		$	357
Net investment income		23			25			24		72			25			28			29		32			114
Net investment gains (losses)		4			2			—		6			2			3			—		1			6
Policy fees and other income		—			—			—		—			1			(1	)		1		(4	)		(3	)

Total revenues		115			113			105		333			114			122			120		118			474

BENEFITS AND EXPENSES:
Benefits and other changes in policy reserves		37			31			21		89			15			27			25		14			81
Acquisition and operating expenses, net of deferrals		23			25			19		67			24			27			25		22			98
Amortization of deferred acquisition costs and intangibles		4			4			3		11			4			4			5		5			18
Interest expense		2			3			3		8			3			3			2		2			10

Total benefits and expenses		66			63			46		175			46			61			57		43			207

INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		49			50			59		158			68			61			63		75			267
Provision for income taxes		16			16			19		51			20			18			18		24			80

INCOME FROM CONTINUING OPERATIONS		33			34			40		107			48			43			45		51			187
Less: income from continuing operations attributable to noncontrolling interests		18			18			21		57			25			22			16		21			84

INCOME FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL, INC.’S COMMON STOCKHOLDERS		15			16			19		50			23			21			29		30			103

ADJUSTMENTS TO INCOME FROM CONTINUING OPERATIONS AVAILABLE TO GENWORTH FINANCIAL, INC.’S COMMON STOCKHOLDERS:
Net investment (gains) losses, net⁽¹⁾		(2	)		(1	)		—		(3	)		(2	)		(1	)		—		—			(3	)
(Gains) losses on early extinguishment of debt⁽²⁾		—			—			—		—			—			1			—		—			1
Taxes on adjustments		1			—			—		1			1			—			—		—			1

NET OPERATING INCOME⁽³⁾	$	14		$	15		$	19	$	48		$	22		$	21		$	29	$	30		$	102



SALES:
New Insurance Written (NIW)
Flow	$	4,600		$	5,000		$	4,400	$	14,000		$	4,600		$	6,300		$	6,500	$	5,800		$	23,200
Bulk		—			800			—		800			—			—			1,700		—			1,700

Total Australia NIW⁽⁴⁾	$	4,600		$	5,800		$	4,400	$	14,800		$	4,600		$	6,300		$	8,200	$	5,800		$	24,900

⁽¹⁾	Net investment (gains) losses were adjusted for the portion of net investment gains (losses) attributable to noncontrolling interests as reconciled below:


Net investment (gains) losses, gross	$	(4	)	$	(2	)	$	—	$	(6	)	$	(2	)	$	(3	)	$	—	$	(1	)	$	(6	)
Adjustment for net investment gains (losses) attributable to noncontrolling interests		2			1			—		3			—			2			—		1			3

Net investment (gains) losses, net	$	(2	)	$	(1	)	$	—	$	(3	)	$	(2	)	$	(1	)	$	—	$	—		$	(3	)

⁽²⁾	For the three months ended September 30, 2015, (gains) losses on early extinguishment of debt were adjusted by $1 million for the portion attributable to noncontrolling interests.

⁽³⁾	Net operating income for the Australian platform adjusted for foreign exchange as compared to the prior year period was $13 million and $51 million for the three and nine months ended September 30, 2016, respectively.

⁽⁴⁾	New insurance written for the Australian platform adjusted for foreign exchange as compared to the prior year period was $4,600 million and $15,500 million for the three and nine months ended September 30, 2016, respectively.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Selected Key Performance Measures—Australia Mortgage Insurance Segment

(amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
Net Premiums Written	$	57		$	65		$	47		$	169		$	55		$	79		$	107		$	87		$	328
Loss Ratio^(1),(2)		42	%		36	%		26	%		35	%		17	%		29	%		28	%		15	%		23	%
Expense Ratio (Net Earned Premiums)⁽³⁾		31	%		33	%		27	%		31	%		31	%		34	%		33	%		30	%		32	%
Expense Ratio (Net Premiums Written)⁽⁴⁾		48	%		44	%		47	%		46	%		49	%		40	%		28	%		31	%		35	%

Primary Insurance In-Force	$	247,900		$	241,100		$	246,800					$	233,600		$	224,100		$	243,800		$	240,900
Primary Risk In-Force⁽⁵⁾
Flow	$	80,400		$	78,300		$	80,300					$	76,000		$	72,900		$	79,100		$	78,600
Bulk		5,900			5,700			5,700						5,500			5,500			6,200			5,700

Total	$	86,300		$	84,000		$	86,000					$	81,500		$	78,400		$	85,300		$	84,300



	September 30, 2016									June 30, 2016
Risk In-Force by Loan-To-Value Ratio⁽⁶⁾	Primary			Flow			Bulk			Primary			Flow			Bulk
95.01% and above	$	14,933		$	14,933		$	—		$	14,812		$	14,812		$	—
90.01% to 95.00%		22,670			22,664			6			21,843			21,837			6
80.01% to 90.00%		23,153			23,087			66			22,356			22,291			65
80.00% and below		25,536			19,743			5,793			25,037			19,368			5,669

Total	$	86,292		$	80,427		$	5,865		$	84,048		$	78,308		$	5,740

The loss and expense ratios included above were calculated using whole dollars and may be different than the ratios calculated using the rounded numbers included herein.

Amounts may not total due to rounding.

⁽¹⁾	The ratio of incurred losses and loss adjustment expenses to net earned premiums.

⁽²⁾

During the third quarter of 2015, the company increased reserves $9 million mainly related to the estimate of the period of time it takes for a delinquent loan to be reported and increased net earned premiums $8 million from refinements to premium recognition factors. These adjustments unfavorably impacted the loss ratio by seven percentage points for the three months ended September 30, 2015. During the first quarter of 2015, the company accrued a $7 million pre-tax receivable for expected recoveries relating to paid claims reflecting its experience of successful borrower recovery activity, which favorably impacted the loss ratio by nine percentage points for the three months ended March 31, 2015.

⁽³⁾

The ratio of an insurer’s general expenses to net earned premiums. In the business, general expenses consist of acquisition and operating expenses, net of deferrals, and amortization of DAC and intangibles. The debt early redemption payment of $2 million in the third quarter of 2015 unfavorably impacted this expense ratio by two percentage points for the three months ended September 30, 2015.

⁽⁴⁾

The ratio of an insurer’s general expenses to net premiums written. In the business, general expenses consist of acquisition and operating expenses, net of deferrals, and amortization of DAC and intangibles. The debt early redemption payment of $2 million in the third quarter of 2015 unfavorably impacted this expense ratio by two percentage points for the three months ended September 30, 2015.

⁽⁵⁾

The business currently provides 100% coverage on the majority of the loans the company insures. For the purpose of representing the risk in-force, Australia has computed an “effective risk in-force” amount which recognizes that the loss on any particular loan will be reduced by the net proceeds received upon sale of the property. Effective risk in-force has been calculated by applying to insurance in-force a factor that represents the highest expected average per-claim payment for any one underwriting year over the life of the business. This factor was 35% for all periods presented. Australia also has certain risk share arrangements where it provides pro-rata coverage of certain loans rather than 100% coverage. As a result, for loans with these risk share arrangements, the applicable pro-rata coverage amount provided is used when applying the factor.

⁽⁶⁾	Loan amount in loan-to-value ratio calculation includes capitalized premiums, where applicable.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Selected Key Performance Measures—Australia Mortgage Insurance Segment

(dollar amounts in millions)


Primary Insurance	September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			September 30, 2015
Insured loans in-force		1,470,302			1,477,826			1,479,544			1,478,434			1,479,676
Insured delinquent loans		6,844			6,413			5,889			5,552			5,804
Insured delinquency rate		0.47	%		0.43	%		0.40	%		0.38	%		0.39	%

Flow loans in-force		1,358,286			1,364,756			1,366,914			1,364,628			1,364,537
Flow delinquent loans		6,574			6,143			5,633			5,317			5,545
Flow delinquency rate		0.48	%		0.45	%		0.41	%		0.39	%		0.41	%

Bulk loans in-force		112,016			113,070			112,630			113,806			115,139
Bulk delinquent loans		270			270			256			235			259
Bulk delinquency rate		0.24	%		0.24	%		0.23	%		0.21	%		0.22	%

Loss Metrics	September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			September 30, 2015
Beginning Reserves	$	190		$	181		$	165		$	156		$	160
Paid claims⁽¹⁾		(18	)		(17	)		(13	)		(14	)		(16	)
Increase in reserves		37			31			20			17			27
Impact of changes in foreign exchange rates		6			(5	)		9			6			(15	)

Ending Reserves	$	215		$	190		$	181		$	165		$	156


	September 30, 2016						June 30, 2016						September 30, 2015
State and Territory	% of Primary Risk In-Force			Primary Delinquency Rate			% of Primary Risk In-Force			Primary Delinquency Rate			% of Primary Risk In-Force			Primary Delinquency Rate
New South Wales		28	%		0.32	%		29	%		0.30	%		29	%		0.30%
Queensland		23			0.67	%		23			0.62	%		23			0.57%
Victoria		23			0.39	%		23			0.37	%		23			0.35%
Western Australia		12			0.69	%		11			0.61	%		11			0.45%
South Australia		6			0.62	%		6			0.59	%		6			0.50%
Australian Capital Territory		3			0.20	%		3			0.19	%		3			0.15%
Tasmania		2			0.37	%		2			0.36	%		2			0.31%
New Zealand		2			0.10	%		2			0.10	%		2			0.23%
Northern Territory		1			0.33	%		1			0.27	%		1			0.21%

Total		100	%		0.47	%		100	%		0.43	%		100	%		0.39%


By Policy Year
2007 and prior		34	%		0.31	%		35	%		0.31	%		36	%		0.31%
2008		6			1.07	%		6			1.01	%		7			0.93%
2009		7			0.93	%		7			0.84	%		8			0.75%
2010		5			0.59	%		6			0.55	%		6			0.44%
2011		6			0.66	%		6			0.58	%		6			0.46%
2012		8			0.72	%		8			0.64	%		9			0.51%
2013		9			0.62	%		9			0.54	%		10			0.37%
2014		10			0.45	%		10			0.36	%		11			0.16%
2015		9			0.17	%		9			0.11	%		7			0.01%
2016		6			0.01	%		4			—	%		—			— %

Total		100	%		0.47	%		100	%		0.43	%		100	%		0.39%

⁽¹⁾	Paid claims exclude adjustments for expected recoveries related to loss reserves and prior paid claims.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Selected Key Performance Measures—Australia Mortgage Insurance Segment

(Australian dollar amounts in millions)


	2016											2015
	3Q			2Q			1Q			Total		4Q			3Q			2Q			1Q			Total
Paid Claims⁽¹⁾
Flow	$	24		$	23		$	18		$	65	$	22		$	21		$	19		$	17		$	79
Bulk		—			—			—			—		—			—			—			1			1

Total Paid Claims	$	24		$	23		$	18		$	65	$	22		$	21		$	19		$	18		$	80


Average Paid Claim (in thousands)	$	73.3		$	79.2		$	65.8				$	71.0		$	65.9		$	66.9		$	62.5

Average Reserve Per Delinquency (in thousands)	$	41.0		$	39.9		$	40.1				$	40.7		$	38.3		$	35.2		$	36.4

Loss Metrics
Beginning Reserves	$	256		$	236		$	226				$	222		$	208		$	196		$	186
Paid claims⁽¹⁾		(24	)		(23	)		(18	)				(22	)		(21	)		(19	)		(18	)
Increase in reserves		49			43			28					26			35			31			28

Ending Reserves	$	281		$	256		$	236				$	226		$	222		$	208		$	196

Loan Amount⁽²⁾

Over $550K		15	%		15	%		15	%				15	%		15	%		14	%		13	%
$400K to $550K		20			20			20					19			19			19			19
$250K to $400K		36			36			36					36			36			36			37
$100K to $250K		24			24			24					25			25			25			26
$100K or Less		5			5			5					5			5			6			5

Total		100	%		100	%		100	%				100	%		100	%		100	%		100	%


Average Primary Loan Size (in thousands)	$	220		$	219		$	218				$	217		$	216		$	213		$	211

All amounts presented in Australian dollars.

⁽¹⁾	Paid claims exclude adjustments for expected recoveries related to loss reserves and prior paid claims.

⁽²⁾	The percentages in this table are based on the amount of primary insurance in-force in each loan band as a percentage of total insurance in-force.

U.S. Life Insurance Segment

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Net Operating Income (Loss)—U.S. Life Insurance Segment

(amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
REVENUES:
Premiums	$	725		$	756		$	436		$	1,917		$	797		$	784		$	769		$	778		$	3,128
Net investment income		695			670			684			2,049			673			680			677			671			2,701
Net investment gains (losses)		21			114			(16	)		119			17			(16	)		(7	)		(4	)		(10	)
Policy fees and other income		175			180			177			532			187			177			182			180			726

Total revenues		1,616			1,720			1,281			4,617			1,674			1,625			1,621			1,625			6,545

BENEFITS AND EXPENSES:
Benefits and other changes in policy reserves		1,556			1,089			758			3,403			1,324			1,155			1,122			1,091			4,692
Interest credited		140			143			144			427			148			148			150			150			596
Acquisition and operating expenses, net of deferrals		149			199			165			513			178			176			167			163			684
Amortization of deferred acquisition costs and intangibles		69			84			78			231			194			530			75			73			872
Interest expense		2			5			28			35			23			22			22			25			92

Total benefits and expenses		1,916			1,520			1,173			4,609			1,867			2,031			1,536			1,502			6,936

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		(300	)		200			108			8			(193	)		(406	)		85			123			(391	)
Provision (benefit) for income taxes		(106	)		70			39			3			(68	)		(144	)		31			43			(138	)

INCOME (LOSS) FROM CONTINUING OPERATIONS		(194	)		130			69			5			(125	)		(262	)		54			80			(253	)

ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS:
Net investment (gains) losses, net⁽¹⁾		(21	)		(119	)		11			(129	)		(20	)		10			4			1			(5	)
(Gains) losses on sale of businesses		—			(1	)		—			(1	)		—			—			—			—			—
(Gains) losses from life block transactions		—			—			9			9			—			455			—			—			455
Expenses related to restructuring		1			3			15			19			3			—			2			—			5
Taxes on adjustments		7			42			(13	)		36			7			(163	)		(3	)		—			(159	)

NET OPERATING INCOME (LOSS)	$	(207	)	$	55		$	91		$	(61	)	$	(135	)	$	40		$	57		$	81		$	43

⁽¹⁾	Net investment (gains) losses were adjusted for DAC and other intangible amortization and certain benefit reserves as reconciled below:


Net investment (gains) losses, gross	$	(21	)	$	(114	)	$	16		$	(119	)	$	(17	)	$	16		$	7		$	4		$	10
Adjustment for DAC and other intangible amortization and certain benefit reserves		—			(5	)		(5	)		(10	)		(3	)		(6	)		(3	)		(3	)		(15	)

Net investment (gains) losses, net	$	(21	)	$	(119	)	$	11		$	(129	)	$	(20	)	$	10		$	4		$	1		$	(5	)

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Net Operating Income (Loss) and Sales—U.S. Life Insurance Segment—Long-Term Care Insurance

(amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
REVENUES:
Premiums	$	610		$	636		$	618		$	1,864		$	633		$	618		$	597		$	589		$	2,437
Net investment income		353			344			329			1,026			325			327			320			313			1,285
Net investment gains (losses)		17			139			4			160			24			4			(3	)		3			28
Policy fees and other income		—			—			1			1			1			—			1			—			2

Total revenues		980			1,119			952			3,051			983			949			915			905			3,752

BENEFITS AND EXPENSES:
Benefits and other changes in policy reserves		1,262			806			776			2,844			797			825			780			766			3,168
Interest credited		—			—			—			—			—			—			—			—			—
Acquisition and operating expenses, net of deferrals		95			93			95			283			110			112			98			95			415
Amortization of deferred acquisition costs and intangibles		25			26			26			77			25			24			24			26			99
Interest expense		—			—			—			—			—			—			—			—			—

Total benefits and expenses		1,382			925			897			3,204			932			961			902			887			3,682

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		(402	)		194			55			(153	)		51			(12	)		13			18			70
Provision (benefit) for income taxes		(142	)		68			20			(54	)		19			(5	)		5			6			25

INCOME (LOSS) FROM CONTINUING OPERATIONS		(260	)		126			35			(99	)		32			(7	)		8			12			45

ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS:
Net investment (gains) losses		(17	)		(139	)		(4	)		(160	)		(24	)		(4	)		3			(3	)		(28	)
Expenses related to restructuring		1			2			3			6			2			—			1			—			3
Taxes on adjustments		6			48			—			54			9			1			(2	)		1			9

NET OPERATING INCOME (LOSS)	$	(270	)	$	37		$	34		$	(199	)	$	19		$	(10	)	$	10		$	10		$	29



SALES:
Individual Long-Term Care Insurance	$	2		$	4		$	5		$	11		$	8		$	7		$	8		$	10		$	33
Group Long-Term Care Insurance		3			2			2			7			2			1			1			1			5

Total Sales	$	5		$	6		$	7		$	18		$	10		$	8		$	9		$	11		$	38

RATIOS:
Loss Ratio⁽¹⁾		145.5	%		70.1	%		67.6	%		93.9	%		72.9	%		76.4	%		72.6	%		72.4	%		73.6	%
Gross Benefits Ratio⁽²⁾		207.0	%		126.7	%		125.5	%		152.6	%		125.9	%		133.5	%		130.5	%		130.2	%		130.0	%

⁽¹⁾	The loss ratio was calculated by dividing benefits and other changes in policy reserves less tabular interest on reserves less loss adjustment expenses by net earned premiums.

⁽²⁾	The gross benefits ratio was calculated by dividing benefits and other changes in policy reserves by net earned premiums.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Net Operating Income (Loss) and Sales—U.S. Life Insurance Segment—Life Insurance

(amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
REVENUES:
Premiums⁽¹⁾	$	115		$	120		$	(185	)	$	50		$	160		$	162		$	169		$	179		$	670
Net investment income		128			117			133			378			125			126			127			127			505
Net investment gains (losses)		4			(1	)		2			5			15			(8	)		3			3			13
Policy fees and other income		171			176			173			520			183			175			178			178			714

Total revenues		418			412			123			953			483			455			477			487			1,902

BENEFITS AND EXPENSES:
Benefits and other changes in policy reserves⁽¹⁾		216			231			(87	)		360			446			248			266			250			1,210
Interest credited		64			65			64			193			68			66			68			66			268
Acquisition and operating expenses, net of deferrals		31			39			51			121			50			48			52			51			201
Amortization of deferred acquisition costs and intangibles		27			27			33			87			150			487			33			30			700
Interest expense		2			5			28			35			23			22			22			25			92

Total benefits and expenses		340			367			89			796			737			871			441			422			2,471

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		78			45			34			157			(254	)		(416	)		36			65			(569	)
Provision (benefit) for income taxes		28			16			12			56			(90	)		(147	)		13			23			(201	)

INCOME (LOSS) FROM CONTINUING OPERATIONS		50			29			22			101			(164	)		(269	)		23			42			(368	)

ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS:
Net investment (gains) losses		(4	)		1			(2	)		(5	)		(15	)		8			(3	)		(3	)		(13	)
(Gains) losses on sale of businesses		—			(1	)		—			(1	)		—			—			—			—			—
(Gains) losses from life block transactions		—			—			9			9			—			455			—			—			455
Expenses related to restructuring		—			2			8			10			—			—			1			—			1
Taxes on adjustments		2			—			(6	)		(4	)		6			(163	)		1			1			(155	)

NET OPERATING INCOME (LOSS)	$	48		$	31		$	31		$	110		$	(173	)	$	31		$	22		$	40		$	(80	)

SALES:
Term Life	$	—		$	2		$	5		$	7		$	6		$	7		$	9		$	9		$	31
Universal Life		1			1			2			4			3			2			4			4			13
Linked-Benefits		—			1			2			3			1			3			2			4			10

Total Sales	$	1		$	4		$	9		$	14		$	10		$	12		$	15		$	17		$	54

⁽¹⁾

In January 2016, as part of a life block transaction, the company entered into a new reinsurance agreement to cede certain of its term life insurance policies. This new reinsurance agreement primarily reduced premiums by $326 million and reduced benefits and other changes in policy reserves by $331 million for the amounts initially ceded.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Net Operating Income (Loss) and Sales—U.S. Life Insurance Segment—Fixed Annuities

(amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
REVENUES:
Premiums	$	—		$	—		$	3		$	3		$	4		$	4		$	3		$	10		$	21
Net investment income		214			209			222			645			223			227			230			231			911
Net investment gains (losses)		—			(24	)		(22	)		(46	)		(22	)		(12	)		(7	)		(10	)		(51	)
Policy fees and other income		4			4			3			11			3			2			3			2			10

Total revenues		218			189			206			613			208			221			229			233			891

BENEFITS AND EXPENSES:
Benefits and other changes in policy reserves⁽¹⁾		78			52			69			199			81			82			76			75			314
Interest credited		76			78			80			234			80			82			82			84			328
Acquisition and operating expenses, net of deferrals⁽²⁾		23			67			19			109			18			16			17			17			68
Amortization of deferred acquisition costs and intangibles		17			31			19			67			19			19			18			17			73
Interest expense		—			—			—			—			—			—			—			—			—

Total benefits and expenses		194			228			187			609			198			199			193			193			783

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		24			(39	)		19			4			10			22			36			40			108
Provision (benfit) for income taxes		8			(14	)		7			1			3			8			13			14			38

INCOME (LOSS) FROM CONTINUING OPERATIONS		16			(25	)		12			3			7			14			23			26			70

ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS:
Net investment (gains) losses, net⁽³⁾		—			19			17			36			19			6			4			7			36
Expenses related to restructuring		—			(1	)		4			3			1			—			—			—			1
Taxes on adjustments		(1	)		(6	)		(7	)		(14	)		(8	)		(1	)		(2	)		(2	)		(13	)

NET OPERATING INCOME (LOSS)	$	15		$	(13	)	$	26		$	28		$	19		$	19		$	25		$	31		$	94



SALES:
Single Premium Deferred Annuities	$	1		$	8		$	159		$	168		$	297		$	248		$	211		$	306		$	1,062
Single Premium Immediate Annuities		—			1			9			10			17			12			13			20			62

Total Sales	$	1		$	9		$	168		$	178		$	314		$	260		$	224		$	326		$	1,124

⁽¹⁾	In the second quarter of 2016, benefits and other changes in policy reserves included $45 million of lower assumed reinsurance in connection with the recapture by a third party.

⁽²⁾	In the second quarter of 2016, acquisition and operating expenses, net of deferrals, included a $55 million ceding commission paid in connection with the recapture by a third party.

⁽³⁾	Net investment (gains) losses were adjusted for DAC and other intangible amortization and certain benefit reserves as reconciled below:


Net investment (gains) losses, gross	$	—	$	24		$	22		$	46		$	22		$	12		$	7		$	10		$	51
Adjustment for DAC and other intangible amortization and certain benefit reserves		—		(5	)		(5	)		(10	)		(3	)		(6	)		(3	)		(3	)		(15	)

Net investment (gains) losses, net	$	—	$	19		$	17		$	36		$	19		$	6		$	4		$	7		$	36

Runoff Segment

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Net Operating Income (Loss)—Runoff Segment

(amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
REVENUES:
Premiums	$	—		$	—		$	—		$	—		$	—		$	—		$	1		$	—		$	1
Net investment income		37			36			35			108			35			32			40			31			138
Net investment gains (losses)		4			(13	)		(8	)		(17	)		(30	)		(25	)		(8	)		(6	)		(69	)
Policy fees and other income		43			42			42			127			45			46			49			49			189

Total revenues		84			65			69			218			50			53			82			74			259

BENEFITS AND EXPENSES:
Benefits and other changes in policy reserves		2			9			15			26			8			18			11			7			44
Interest credited		33			30			33			96			32			31			31			30			124
Acquisition and operating expenses, net of deferrals		20			18			16			54			19			17			21			19			76
Amortization of deferred acquisition costs and intangibles		7			12			6			25			(3	)		17			10			5			29
Interest expense		1			—			—			1			—			—			1			—			1

Total benefits and expenses		63			69			70			202			56			83			74			61			274

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		21			(4	)		(1	)		16			(6	)		(30	)		8			13			(15	)
Provision (benefit) for income taxes		6			(2	)		(2	)		2			(3	)		(12	)		2			3			(10	)

INCOME (LOSS) FROM CONTINUING OPERATIONS		15			(2	)		1			14			(3	)		(18	)		6			10			(5	)

ADJUSTMENTS TO INCOME (LOSS) FROM CONTINUING OPERATIONS:
Net investment (gains) losses, net⁽¹⁾		(4	)		12			4			12			22			21			5			1			49
Taxes on adjustments		1			(4	)		(1	)		(4	)		(8	)		(7	)		(2	)		—			(17	)

NET OPERATING INCOME (LOSS)	$	12		$	6		$	4		$	22		$	11		$	(4	)	$	9		$	11		$	27

⁽¹⁾	Net investment (gains) losses were adjusted for DAC and other intangible amortization and certain benefit reserves as reconciled below:


Net investment (gains) losses, gross	$	(4	)	$	13		$	8		$	17		$	30		$	25		$	8		$	6		$	69
Adjustment for DAC and other intangible amortization and certain benefit reserves		—			(1	)		(4	)		(5	)		(8	)		(4	)		(3	)		(5	)		(20	)

Net investment (gains) losses, net	$	(4	)	$	12		$	4		$	12		$	22		$	21		$	5		$	1		$	49

Corporate and Other

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Net Operating Loss—Corporate and Other⁽¹⁾

(amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
REVENUES:
Premiums	$	2		$	3		$	6		$	11		$	6		$	7		$	5		$	7		$	25
Net investment income		1			1			2			4			3			(1	)		1			(6	)		(3	)
Net investment gains (losses)⁽²⁾		(9	)		(65	)		(14	)		(88	)		6			9			3			11			29
Policy fees and other income⁽³⁾		(1	)		76			1			76			—			—			(10	)		—			(10	)

Total revenues		(7	)		15			(5	)		3			15			15			(1	)		12			41

BENEFITS AND EXPENSES:
Benefits and other changes in policy reserves		1			1			2			4			3			3			3			5			14
Acquisition and operating expenses, net of deferrals⁽⁴⁾		11			25			137			173			154			40			22			14			230
Amortization of deferred acquisition costs and intangibles		1			—			—			1			—			—			—			1			1
Interest expense		67			68			70			205			74			75			74			75			298

Total benefits and expenses		80			94			209			383			231			118			99			95			543

LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		(87	)		(79	)		(214	)		(380	)		(216	)		(103	)		(100	)		(83	)		(502	)
Provision (benefit) for income taxes		246			(31	)		(96	)		119			(28	)		(33	)		(39	)		(30	)		(130	)

LOSS FROM CONTINUING OPERATIONS		(333	)		(48	)		(118	)		(499	)		(188	)		(70	)		(61	)		(53	)		(372	)

ADJUSTMENTS TO LOSS FROM CONTINUING OPERATIONS:
Net investment (gains) losses		9			65			14			88			(6	)		(9	)		(3	)		(11	)		(29	)
(Gains) losses on sale of businesses		—			(9	)		7			(2	)		140			—			—			—			140
(Gains) losses on early extinguishment of debt		—			(64	)		16			(48	)		—			1			—			—			1
Expenses related to restructuring		—			2			—			2			2			—			1			—			3
Fees associated with bond consent solicitation		—			—			18			18			—			—			—			—			—
Taxes on adjustments		(3	)		2			(42	)		(43	)		(6	)		10			1			4			9

NET OPERATING LOSS	$	(327	)	$	(52	)	$	(105	)	$	(484	)	$	(58	)	$	(68	)	$	(62	)	$	(60	)	$	(248	)

⁽¹⁾	Includes inter-segment eliminations and the results of other businesses that are managed outside the operating segments, including certain smaller international mortgage insurance businesses.

⁽²⁾	In the second quarter of 2016, net investment gains (losses) included a $64 million loss from the write-off of residual interest in certain policy loan securitization entities.

⁽³⁾	In the second quarter of 2016, the company settled restricted borrowings of $70 million related to a securitization entity and recorded a $64 million pre-tax gain related to the early extinguishment of debt, which was included in policy fees and other income.

⁽⁴⁾

In the first quarter of 2016, acquisition and operating expenses, net of deferrals, included the following: $83 million of legal fees and expenses, including $69 million related to the settlement of the long-term care insurance class action lawsuit; $20 million of make-whole expense on the early redemption of Genworth Holdings’ 2016 senior notes in January 2016; $18 million associated with Genworth Holdings’ bond consent solicitation for broker, advisor and investment banking fees; and an additional estimated loss of $7 million related to the planned sale of the mortgage insurance business in Europe. In the fourth quarter of 2015, acquisition and operating expenses, net of deferrals, included an estimated loss of $140 million related to the planned sale of the mortgage insurance business in Europe.

Additional Financial Data

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Investments Summary

(amounts in millions)


		September 30, 2016					June 30, 2016					March 31, 2016					December 31, 2015					September 30, 2015
		Carrying Amount		% of Total			Carrying Amount		% of Total			Carrying Amount		% of Total			Carrying Amount		% of Total			Carrying Amount		% of Total
Composition of Investment Portfolio
Fixed maturity securities:
Investment grade:
Public fixed maturity securities		$	35,544		45	%	$	35,003		45	%	$	33,362		44	%	$	31,969		43	%	$	33,541		44	%
Private fixed maturity securities			11,669		15			11,370		15			10,867		14			10,822		15			10,908		15
Residential mortgage-backed securities⁽¹⁾			4,742		6			4,981		6			5,041		7			4,998		7			5,008		7
Commercial mortgage-backed securities			3,148		4			2,940		4			2,633		4			2,475		3			2,492		3
Other asset-backed securities			3,310		4			3,279		4			3,287		4			3,253		4			3,904		5
State and political subdivisions			2,823		4			2,751		4			2,517		3			2,428		3			2,447		3
Non-investment grade fixed maturity securities			2,544		3			2,504		3			2,583		3			2,252		3			2,346		3
Equity securities:
Common stocks and mutual funds			175		—			140		—			108		—			37		—			37		—
Preferred stocks			415		1			341		1			323		—			273		—			236		—
Commercial mortgage loans			6,017		8			6,121		8			6,179		8			6,170		8			6,133		8
Restricted commercial mortgage loans related to securitization entities			134		—			141		—			155		—			161		—			175		—
Policy loans			1,751		2			1,754		2			1,565		2			1,568		2			1,567		2
Cash, cash equivalents and short-term investments			3,420		4			3,730		5			4,217		6			6,162		8			4,003		6
Securities lending			417		1			328		—			415		1			347		—			367		—
Other invested assets:	Limited partnerships		188		—			181		—			177		—			188		—			195		—
	Derivatives:
	Long-term care (LTC) forward starting swap—cash flow		735		1			627		1			1,087		1			629		1			768		1
	Other cash flow		6		—			7		—			7		—			8		—			8		—
	Equity index options—non-qualified		61		—			57		—			36		—			30		—			15		—
	Other non-qualified		529		1			578		1			537		1			445		1			534		1
	Trading portfolio		384		1			441		1			471		1			447		1			458		1
	Restricted other invested assets related to securitization entities		312		—			312		—			422		1			413		1			412		1
	Other		14		—			18		—			19		—			18		—			51		—

Total invested assets and cash		$	78,338		100	%	$	77,604		100	%	$	76,008		100	%	$	75,093		100	%	$	75,605		100	%

Public Fixed Maturity Securities—Credit Quality:
NRSRO⁽²⁾ Designation
AAA		$	15,608		33	%	$	15,714		33	%	$	15,385		34	%	$	14,785		34	%	$	15,057		33	%
AA			4,536		9			4,455		10			4,174		10			4,121		10			4,603		10
A			13,317		28			13,122		28			12,664		28			12,155		28			13,485		30
BBB			12,632		27			12,154		26			11,213		25			10,720		25			10,667		24
BB			1,464		3			1,440		3			1,464		3			1,200		3			1,234		3
B			145		—			149		—			141		—			63		—			50		—
CCC and lower			53		—			56		—			77		—			92		—			95		—

Total public fixed maturity securities		$	47,755		100	%	$	47,090		100	%	$	45,118		100	%	$	43,136		100	%	$	45,191		100	%

Private Fixed Maturity Securities—Credit Quality:
NRSRO⁽²⁾ Designation
AAA		$	1,731		11	%	$	1,683		10	%	$	1,614		10	%	$	1,531		10	%	$	1,725		11	%
AA			2,071		13			2,013		13			1,923		13			1,899		13			1,966		13
A			4,937		31			4,864		31			4,725		31			4,731		31			4,737		31
BBB			6,404		40			6,319		40			6,009		40			6,003		40			6,060		39
BB			815		5			734		5			772		5			777		5			839		5
B			51		—			102		1			104		1			104		1			114		1
CCC and lower			16		—			23		—			25		—			16		—			14		—

Total private fixed maturity securities		$	16,025		100	%	$	15,738		100	%	$	15,172		100	%	$	15,061		100	%	$	15,455		100	%

⁽¹⁾	The company does not have any material exposure to residential mortgage-backed securities collateralized debt obligations (CDOs).

⁽²⁾	Nationally Recognized Statistical Rating Organizations.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Fixed Maturity Securities Summary

(amounts in millions)


	September 30, 2016					June 30, 2016					March 31, 2016					December 31, 2015					September 30, 2015
	Fair Value		% of Total			Fair Value		% of Total			Fair Value		% of Total			Fair Value		% of Total			Fair Value		% of Total
Fixed Maturity Securities—Security Sector:
U.S. government, agencies and government-sponsored enterprises	$	6,703		11	%	$	6,806		11	%	$	6,524		11	%	$	6,203		11	%	$	5,913		10	%
State and political subdivisions		2,824		4			2,751		4			2,517		4			2,438		4			2,448		4
Foreign government		2,227		3			2,113		3			2,080		3			2,015		3			1,935		3
U.S. corporate		27,695		44			26,984		43			25,389		43			24,401		42			25,679		43
Foreign corporate		13,008		20			12,833		21			12,629		21			12,199		21			13,027		22
Residential mortgage-backed securities		4,823		8			5,055		8			5,122		8			5,101		9			5,118		8
Commercial mortgage-backed securities		3,173		5			2,979		5			2,713		4			2,559		4			2,587		4
Other asset-backed securities		3,327		5			3,307		5			3,316		6			3,281		6			3,939		6

Total fixed maturity securities	$	63,780		100	%	$	62,828		100	%	$	60,290		100	%	$	58,197		100	%	$	60,646		100	%

Corporate Bond Holdings—Industry Sector:
Investment Grade:
Finance and insurance	$	8,756		23	%	$	8,499		23	%	$	8,128		23	%	$	7,746		22	%	$	8,290		23	%
Utilities		5,637		15			5,507		15			5,275		15			4,453		13			4,618		12
Energy		2,961		8			2,949		8			2,908		8			3,839		11			4,249		11
Consumer—non-cyclical		5,483		14			5,292		14			4,894		14			4,619		13			4,647		13
Consumer—cyclical		2,034		5			2,039		5			2,150		6			2,119		6			2,288		6
Capital goods		2,623		7			2,613		7			2,444		7			2,361		7			2,461		7
Industrial		2,006		5			1,971		5			1,980		5			1,915		6			2,130		6
Technology and communications		3,418		9			3,272		9			3,019		8			2,872		8			3,095		8
Transportation		1,868		5			1,860		5			1,750		5			1,689		5			1,695		5
Other		3,605		9			3,538		9			3,162		9			3,049		9			3,213		9

Subtotal		38,391		100	%		37,540		100	%		35,710		100	%		34,662		100	%		36,686		100	%

Non-Investment Grade:
Finance and insurance		242		11	%		285		13	%		306		13	%		359		19	%		381		19	%
Utilities		73		3			74		3			78		4			83		4			67		3
Energy		713		31			679		30			693		30			348		18			400		20
Consumer—non-cyclical		217		9			217		9			226		10			229		12			230		11
Consumer—cyclical		131		6			131		6			86		4			82		4			98		5
Capital goods		152		7			153		7			216		9			193		10			204		10
Industrial		303		13			263		11			279		12			244		13			254		13
Technology and communications		355		15			335		15			320		14			309		16			293		14
Transportation		30		1			30		1			2		—			2		—			2		—
Other		96		4			110		5			102		4			89		4			91		5

Subtotal		2,312		100	%		2,277		100	%		2,308		100	%		1,938		100	%		2,020		100	%

Total	$	40,703		100	%	$	39,817		100	%	$	38,018		100	%	$	36,600		100	%	$	38,706		100	%

Fixed Maturity Securities—Contractual Maturity Dates:

Due in one year or less	$	1,775		3	%	$	1,851		3	%	$	1,879		3	%	$	1,744		3	%	$	2,075		4	%
Due after one year through five years		11,309		18			11,024		18			10,730		18			10,192		18			10,817		18
Due after five years through ten years		13,129		20			12,708		20			11,964		20			11,917		20			12,155		20
Due after ten years		26,244		41			25,904		41			24,566		41			23,403		40			23,955		40

Subtotal		52,457		82			51,487		82			49,139		82			47,256		81			49,002		82
Mortgage and asset-backed securities		11,323		18			11,341		18			11,151		18			10,941		19			11,644		18

Total fixed maturity securities	$	63,780		100	%	$	62,828		100	%	$	60,290		100	%	$	58,197		100	%	$	60,646		100	%

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

General Account GAAP Net Investment Income Yields

(amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
GAAP Net Investment Income
Fixed maturity securities—taxable	$	655		$	634		$	641		$	1,930		$	634		$	647		$	645		$	632		$	2,558
Fixed maturity securities—non-taxable		3			3			3			9			3			3			3			3			12
Commercial mortgage loans		79			77			81			237			85			84			83			85			337
Restricted commercial mortgage loans related to securitization entities		3			3			2			8			4			3			3			4			14
Equity securities		8			7			5			20			4			3			4			4			15
Other invested assets		29			33			32			94			30			22			17			33			102
Limited partnerships		5			—			6			11			2			4			20			7			33
Restricted other invested assets related to securitization entities		—			1			2			3			2			1			1			1			5
Policy loans		38			34			35			107			36			33			35			33			137
Cash, cash equivalents and short-term investments		5			6			5			16			3			3			4			3			13

Gross investment income before expenses and fees		825			798			812			2,435			803			803			815			805			3,226
Expenses and fees		(20	)		(19	)		(23	)		(62	)		(22	)		(20	)		(22	)		(24	)		(88	)

Net investment income	$	805		$	779		$	789		$	2,373		$	781		$	783		$	793		$	781		$	3,138

Annualized Yields
Fixed maturity securities—taxable		4.6	%		4.6	%		4.7	%		4.6	%		4.6	%		4.6	%		4.6	%		4.6	%		4.6	%
Fixed maturity securities—non-taxable		3.7	%		3.6	%		3.6	%		3.6	%		3.5	%		3.5	%		3.5	%		3.5	%		3.5	%
Commercial mortgage loans		5.2	%		5.0	%		5.2	%		5.2	%		5.5	%		5.5	%		5.4	%		5.6	%		5.5	%
Restricted commercial mortgage loans related to securitization entities		7.4	%		8.0	%		5.1	%		7.2	%		9.5	%		6.4	%		7.2	%		8.2	%		8.0	%
Equity securities		5.8	%		5.8	%		5.1	%		5.7	%		5.1	%		4.0	%		5.6	%		6.1	%		5.2	%
Other invested assets		31.6	%		31.9	%		29.4	%		31.3	%		27.4	%		22.2	%		24.2	%		60.6	%		30.7	%
Limited partnerships⁽¹⁾		10.9	%		—	%		13.2	%		8.0	%		4.2	%		7.8	%		37.0	%		12.0	%		15.5	%
Restricted other invested assets related to securitization entities		—	%		1.1	%		2.0	%		1.1	%		2.0	%		1.0	%		1.0	%		1.0	%		1.3	%
Policy loans		8.7	%		8.2	%		8.9	%		8.6	%		9.2	%		8.4	%		9.1	%		8.8	%		8.9	%
Cash, cash equivalents and short-term investments		0.6	%		0.6	%		0.4	%		0.5	%		0.2	%		0.3	%		0.3	%		0.2	%		0.3	%

Gross investment income before expenses and fees		4.7	%		4.6	%		4.6	%		4.6	%		4.6	%		4.6	%		4.6	%		4.6	%		4.6	%
Expenses and fees		-0.1	%		-0.1	%		-0.1	%		-0.1	%		-0.1	%		-0.1	%		-0.1	%		-0.1	%		-0.1	%

Net investment income		4.6	%		4.5	%		4.5	%		4.5	%		4.5	%		4.5	%		4.5	%		4.5	%		4.5	%

Yields are based on net investment income as reported under GAAP and are consistent with how the company measures its investment performance for management purposes. Yields are annualized, for interim periods, and are calculated as net investment income as a percentage of average quarterly asset carrying values except for fixed maturity and equity securities, derivatives and derivative counterparty collateral, which exclude unrealized fair value adjustments and securities lending activity, which is included in other invested assets and is calculated net of the corresponding securities lending liability. See page 49 herein for average invested assets and cash used in the yield calculation.

⁽¹⁾	Limited partnership investments are equity-based and do not have fixed returns by period.

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Net Investment Gains (Losses), Net—Detail

(amounts in millions)


	2016												2015
	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
Net realized gains (losses) on available-for-sale securities:
Fixed maturity securities:
U.S. corporate	$	2		$	—		$	(7	)	$	(5	)	$	12		$	(3	)	$	—		$	—		$	9
U.S. government, agencies and government-sponsored enterprises		15			137			7			159			3			—			—			1			4
Foreign corporate		(1	)		(6	)		(8	)		(15	)		(6	)		(1	)		(2	)		(7	)		(16	)
Foreign government		4			—			—			4			(2	)		—			1			1			—
Tax-exempt		—			—			—			—			(1	)		—			—			—			(1	)
Mortgage-backed securities		(1	)		—			—			(1	)		—			(3	)		2			—			(1	)
Asset-backed securities		(5	)		(10	)		—			(15	)		(2	)		(2	)		—			—			(4	)
Equity securities		1			—			1			2			1			3			12			7			23
Foreign exchange		—			1			—			1			2			2			1			1			6

Total net realized gains (losses) on available-for-sale securities		15			122			(7	)		130			7			(4	)		14			3			20

Impairments:
Corporate fixed maturity securities		—			(16	)		(8	)		(24	)		(15	)		(6	)		—			—			(21	)
Foreign government		—			(1	)		—			(1	)		—			—			—			—			—
Limited partnerships		—			—			(3	)		(3	)		—			—			—			—			—
Commercial mortgage loans		—			(4	)		—			(4	)		—			(1	)		—			(3	)		(4	)
Commercial mortgage-backed securities		—			(1	)		—			(1	)		—			—			—			—			—
Other asset-backed securities		—			—			—			—			—			(2	)		—			—			(2	)
Equity securities		(2	)		—			—			(2	)		—			—			—			—			—

Total impairments		(2	)		(22	)		(11	)		(35	)		(15	)		(9	)		—			(3	)		(27	)

Net unrealized gains (losses) on trading securities		(4	)		16			28			40			(9	)		12			(16	)		6			(7	)
Commercial mortgage loans held-for-sale market valuation allowance		(1	)		1			1			1			2			1			2			2			7
Net gains (losses) related to securitization entities		2			(61	)		8			(51	)		(4	)		(1	)		2			8			5
Derivative instruments		10			(24	)		(38	)		(52	)		3			(53	)		6			(32	)		(76	)
Contingent purchase price valuation change		—			(2	)		—			(2	)		—			2			—			—			2
Other		—			—			—			—			—			1			—			—			1

Net investment gains (losses), gross		20			30			(19	)		31			(16	)		(51	)		8			(16	)		(75	)
Adjustment for DAC and other intangible amortization and certain benefit reserves		—			6			9			15			11			10			6			8			35
Adjustment for net investment (gains) losses attributable to noncontrolling interests		(2	)		3			(9	)		(8	)		4			8			(9	)		7			10

Net investment gains (losses), net	$	18		$	39		$	(19	)	$	38		$	(1	)	$	(33	)	$	5		$	(1	)	$	(30	)

Reconciliations of Non-GAAP Measures

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Reconciliation of Operating ROE

(amounts in millions)


Twelve Month Rolling Average ROE	Twelve months ended
	September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			September 30, 2015
GAAP Basis ROE
Net income (loss) available to Genworth Financial, Inc.’s common stockholders for the twelve months ended⁽¹⁾	$	(447	)	$	(351	)	$	(716	)	$	(615	)	$	(1,083	)
Quarterly average Genworth Financial, Inc.’s stockholders’ equity, excluding accumulated other comprehensive income (loss)⁽²⁾	$	9,900		$	10,042		$	10,160		$	10,281		$	10,564
GAAP Basis ROE ^(1)/(2)		-4.5	%		-3.5	%		-7.0	%		-6.0	%		-10.3	%

Operating ROE
Net operating income (loss) for the twelve months ended⁽¹⁾	$	(261	)	$	208		$	204		$	255		$	(78	)
Quarterly average Genworth Financial, Inc.’s stockholders’ equity, excluding accumulated other comprehensive income (loss)⁽²⁾	$	9,900		$	10,042		$	10,160		$	10,281		$	10,564
Operating ROE ^(1)/(2)		-2.6	%		2.1	%		2.0	%		2.5	%		-0.7	%

Quarterly Average ROE	Three months ended
	September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			September 30, 2015
GAAP Basis ROE
Net income (loss) available to Genworth Financial, Inc.’s common stockholders for the period ended⁽³⁾	$	(380	)	$	172		$	53		$	(292	)	$	(284	)
Quarterly average Genworth Financial, Inc.’s stockholders’ equity for the period, excluding accumulated other comprehensive income (loss)⁽⁴⁾	$	9,857		$	9,958		$	9,842		$	9,958		$	10,241
Annualized GAAP Quarterly Basis ROE ^(3)/(4)		-15.4	%		6.9	%		2.2	%		-11.7	%		-11.1	%

Operating ROE
Net operating income (loss) for the period ended⁽³⁾	$	(405	)	$	123		$	103		$	(82	)	$	64
Quarterly average Genworth Financial, Inc.’s stockholders’ equity for the period, excluding accumulated other comprehensive income (loss)⁽⁴⁾	$	9,857		$	9,958		$	9,842		$	9,958		$	10,241
Annualized Operating Quarterly Basis ROE ^(3)/(4)		-16.4	%		4.9	%		4.2	%		-3.3	%		2.5	%

Non-GAAP Definition for Operating ROE

The company references the non-GAAP financial measure entitled “operating return on equity” or “operating ROE.” The company defines operating ROE as net operating income (loss) divided by average ending Genworth Financial, Inc.’s stockholders’ equity, excluding accumulated other comprehensive income (loss) in average ending Genworth Financial, Inc.’s stockholders’ equity. Management believes that analysis of operating ROE enhances understanding of the efficiency with which the company deploys its capital. However, operating ROE is not a substitute for net income (loss) available to Genworth Financial, Inc.’s common stockholders divided by average ending Genworth Financial, Inc.’s stockholders’ equity determined in accordance with GAAP.

⁽¹⁾	The twelve months ended information is derived by adding the four quarters of net income (loss) available to Genworth Financial, Inc.’s common stockholders and net operating income (loss) from page 9 herein.

⁽²⁾	Quarterly average Genworth Financial, Inc.’s stockholders’ equity, excluding accumulated other comprehensive income (loss), is derived by averaging ending Genworth Financial, Inc.’s stockholders’ equity, excluding accumulated other comprehensive income (loss), for the most recent five quarters.

⁽³⁾	Net income (loss) available to Genworth Financial, Inc.’s common stockholders and net operating income (loss) from page 9 herein.

⁽⁴⁾	Quarterly average Genworth Financial, Inc.’s stockholders’ equity, excluding accumulated other comprehensive income (loss), is derived by averaging ending Genworth Financial, Inc.’s stockholders’ equity, excluding accumulated other comprehensive income (loss).

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Reconciliation of Core Yield


		2016												2015
	(Assets—amounts in billions)	3Q			2Q			1Q			Total			4Q			3Q			2Q			1Q			Total
	Reported—Total Invested Assets and Cash	$	78.3		$	77.6		$	76.0		$	78.3		$	75.1		$	75.6		$	75.3		$	77.9		$	75.1
	Subtract:
	Securities lending		0.4			0.3			0.4			0.4			0.3			0.4			0.3			0.3			0.3
	Unrealized gains (losses)		7.7			7.6			6.3			7.7			4.2			5.4			4.9			7.8			4.2

	Adjusted end of period invested assets and cash	$	70.2		$	69.7		$	69.3		$	70.2		$	70.6		$	69.8		$	70.1		$	69.8		$	70.6

(A)	Average Invested Assets and Cash Used in Reported Yield Calculation	$	69.7		$	69.5		$	70.0		$	69.7		$	70.2		$	70.0		$	70.0		$	69.7		$	70.0
	Subtract:
	Restricted commercial mortgage loans and other invested assets related to securitization entities⁽¹⁾		0.3			0.1			0.2			0.2			0.2			0.2			0.2			0.2			0.2

(B)	Average Invested Assets and Cash Used in Core Yield Calculation	$	69.4		$	69.4		$	69.8		$	69.5		$	70.0		$	69.8		$	69.8		$	69.5		$	69.8


	(Income—amounts in millions)

(C)	Reported—Net Investment Income	$	805		$	779		$	789		$	2,373		$	781		$	783		$	793		$	781		$	3,138
	Subtract:
	Bond calls and commercial mortgage loan prepayments		14			5			11			30			18			12			17			14			61
	Other non-core items⁽²⁾		8			(6	)		15			17			(2	)		1			(4	)		7			2
	Restricted commercial mortgage loans and other invested assets related to securitization entities⁽¹⁾		1			2			3			6			3			2			2			3			10

(D)	Core Net Investment Income	$	782		$	778		$	760		$	2,320		$	762		$	768		$	778		$	757		$	3,065


(C) / (A)	Reported Yield		4.62	%		4.48	%		4.51	%		4.54	%		4.45	%		4.47	%		4.53	%		4.48	%		4.48	%
(D) / (B)	Core Yield		4.51	%		4.48	%		4.36	%		4.45	%		4.35	%		4.40	%		4.46	%		4.36	%		4.39	%

Notes:

Columns may not add due to rounding.

Yields have been annualized.

Non-GAAP Definition for Core Yield

The company references the non-GAAP financial measure entitled “core yield” as a measure of investment yield. The company defines core yield as the investment yield adjusted for items that do not reflect the underlying performance of the investment portfolio. Management believes that analysis of core yield enhances understanding of the investment yield of the company. However, core yield is not a substitute for investment yield determined in accordance with GAAP.

⁽¹⁾	Represents the incremental assets and investment income related to restricted commercial mortgage loans and other invested assets.

⁽²⁾	Includes cost basis adjustments on structured securities and various other immaterial items.

Corporate Information

GENWORTH FINANCIAL, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

Financial Strength Ratings As Of November 2, 2016


Company	Standard & Poor’s Financial Services LLC (S&P)	Moody’s Investors Service, Inc. (Moody’s)	A.M. Best Company, Inc. (A.M. Best)
Genworth Mortgage Insurance Corporation	BB+	Ba1	Not rated
Genworth Financial Mortgage Insurance Company Canada⁽¹⁾	A+	Not rated	Not rated
Genworth Financial Mortgage Insurance Pty Limited (Australia)⁽²⁾	A+	A3	Not rated
Genworth Life Insurance Company	BB-	Ba2	B
Genworth Life and Annuity Insurance Company	BB-	Baa2	B++
Genworth Life Insurance Company of New York	BB-	Ba2	B

The S&P, Moody’s, A.M. Best, Dominion Bond Rating Service (DBRS) and Fitch Rating Service (Fitch) ratings included are not designed to be, and do not serve as, measures of protection or valuation offered to investors. These financial strength ratings should not be relied on with respect to making an investment in the company’s securities.

S&P states that insurers rated “A” (Strong) or “BB” (Marginal) have strong or marginal financial security characteristics, respectively. The “A” and “BB” ranges are the third- and fifth-highest of nine financial strength rating ranges assigned by S&P, which range from “AAA” to “R.” A plus (+) or minus (-) shows relative standing within a major rating category. These suffixes are not added to ratings in the “AAA” category or to ratings below the “CCC” category. Accordingly, the “A+,” “BB+” and “BB-” ratings are the fifth-, eleventh- and thirteenth-highest of S&P’s 21 ratings categories.

Moody’s states that insurance companies rated “A” (Good) offer good financial security, that insurance companies rated “Baa” (Adequate) offer adequate financial security and that insurance companies rated “Ba” (Questionable) offer questionable financial security. The “A” (Good), “Baa” (Adequate) and “Ba” (Questionable) ranges are the third-, fourth- and fifth-highest, respectively, of nine financial strength rating ranges assigned by Moody’s, which range from “Aaa” to “C.” Numeric modifiers are used to refer to the ranking within the group, with 1 being the highest and 3 being the lowest. These modifiers are not added to ratings in the “Aaa” category or to ratings below the “Caa” category. Accordingly, the “A3,” “Baa2,” “Ba1” and “Ba2” ratings are the seventh-, ninth-, eleventh- and twelfth-highest, respectively, of Moody’s 21 ratings categories.

A.M. Best states that the “B++” (Good) rating is assigned to those companies that have, in its opinion, a good ability to meet their ongoing insurance obligations while “B” (Fair) is assigned to those companies that have, in its opinion, a fair ability to meet their ongoing insurance obligations. The “B++” (Good) and “B” (Fair) ratings are the fifth- and seventh-highest of 15 ratings assigned by A.M. Best, which range from “A++” to “F.”

DBRS states that long-term obligations rated “AA” are of superior credit quality. The capacity for the payment of financial obligations is considered high and unlikely to be significantly vulnerable to future events. Credit quality differs from “AAA” only to a small degree.

The Australian mortgage insurance subsidiary also solicits a rating from Fitch. Fitch states that “A” (Strong) rated insurance companies are viewed as possessing strong capacity to meet policyholder and contract obligations. The “A” rating category is the third-highest of nine financial strength rating categories, which range from “AAA” to “C.” The symbol (+) or (-) may be appended to a rating to indicate the relative position of a credit within a rating category. These suffixes are not added to ratings in the “AAA” category or to ratings below the “B” category. Accordingly, the “A+” rating is the fifth-highest of Fitch’s 21 ratings categories.

The company also solicits a rating from HR Ratings on a local scale for Genworth Seguros de Credito a la Vivienda S.A. de C.V., its Mexican mortgage insurance subsidiary, with a short-term rating of “HR1” and long-term rating of “HR AA-.” For short-term ratings, HR Ratings states that “HR1” rated companies are viewed as exhibiting high capacity for timely payment of debt obligations in the short-term and maintain low credit risk. The “HR1” short-term rating category is the highest of six short-term rating categories, which range from “HR1” to “HR D.” For long-term ratings, HR Ratings states that “HR AA-” rated companies are viewed as having high credit quality and offer high safety for timely payment of debt obligations and maintain low credit risk under adverse economic scenarios. The “HR AA-” long-term rating is the second-highest of HR Rating’s eight long-term rating categories, which range from “HR AAA” to “HR D.”

S&P, Moody’s, A.M. Best, DBRS, Fitch and HR Ratings review their ratings periodically and the company cannot assure you that it will maintain the current ratings in the future. Other agencies may also rate the company or its insurance subsidiaries on a solicited or an unsolicited basis.

⁽¹⁾	Genworth Financial Mortgage Insurance Company Canada is also rated “AA” by DBRS.

⁽²⁾	Genworth Financial Mortgage Insurance Pty Limited (Australia) is also rated “A+” by Fitch.