The Hartford Financial Services Group Inc. reported a $101 million second-quarter net loss Wednesday, a consequence of paying off a huge debt to Allianz SE.
Retiring the debt is part of the insurer’s continuing effort to refocus its priorities on insurance underwriting. As part of that plan, it said Tuesday that it is selling its securities brokerage Woodbury Financial Services to American International Group Inc.
The insurer said its loss for the April-through-June period amounted to 26 cents per share and compared with net income of $33 million, or 5 cents per share, a year earlier.
The quarter was dominated by a $587 million loss for retiring the debt. Results also included a $77 million loss from discontinued operations due to the sale of Federal Trust Corp.
The insurer said its operating earnings rose to $119 million, or 23 cents per share, from $14 million, or a penny per share, last year. That was well below analysts’ average estimate of 44 cents per share, according to FactSet.
The Hartford completed purchasing back the Allianz debt in April for $2.43 billion, a move it said it made in the interest of more financial flexibility and to save about $45 million annually in interest payments.
The debt and warrants were issued to the German insurer in October 2008, during the depths of the financial crisis. Hartford had said then that Allianz’s $2.5 billion investment would help it strengthen its capital position.
Hartford Financial posts $101M 2Q loss
