(Reuters) -Manulife Financial Corp reported a drop in third-quarter profit on Wednesday, as escalating worries of an economic downturn impaired earnings at its wealth and asset management unit.
Manulife's core earnings in global wealth and asset management sank nearly 2% to C$345 million ($255 million) in the third quarter, while net inflows dropped 69% to C$3 billion as turbulent markets deterred investors.
A soaring inflation has ravaged the Canadian economy which despite slowing to 6.9% from a peak of 8.1% remains way above the 2% target.
Last month, the Bank of Canada increased its policy rate by half a percentage point to 3.75%, but warned that economic activity would stall from the fourth quarter of 2022 through the first half of 2023.
Manulife, Canada's largest insurer, reported core earnings of C$1.32 billion, or 67 Canadian cents a share, in the three months ended Sept. 30, compared with C$1.52 billion, or 76 Canadian cents a share, a year earlier.
Net income attributed to shareholders was C$1.35 billion, or 68 Canadian cents per share, compared with C$1.59 billion, or 80 Canadian cents a share, a year earlier.
($1 = 1.3527 Canadian dollars)
(Reporting by Mehnaz Yasmin in Bengaluru; Editing by Shailesh Kuber)