Stockholders' Equity

3 Months Ended

Mar. 31, 2013

Stockholders' Equity

Stockholders' Equity

9.  Stockholders’ Equity

Common Stock

On March 29, 2013, we paid a quarterly dividend of $67.6 million, equal to $0.23 per share, to stockholders of record as of March 11, 2013. On March 30, 2012, we paid a quarterly dividend of $54.3 million, equal to $0.18 per share, to stockholders of record as of March 12, 2012.

Reconciliation of Outstanding Shares

	Series A	Series B	Common
	preferred stock	preferred stock	stock
	(in millions)
Outstanding shares at January 1, 2012	3.0	10.0	301.1
Shares issued	—	—	2.1
Treasury stock acquired	—	—	(2.3	)
Outstanding shares at March 31, 2012	3.0	10.0	300.9
Outstanding shares at January 1, 2013	3.0	10.0	293.8
Shares issued	—	—	2.4
Treasury stock acquired	—	—	(2.9	)
Outstanding shares at March 31, 2013	3.0	10.0	293.3

In February 2012, our Board of Directors authorized a share repurchase program of up to $100.0 million of our outstanding common stock. We completed this program in May 2012. In May 2012, our Board of Directors authorized a share repurchase program of up to $200.0 million of our outstanding common stock. We completed this program in February 2013. Also in February 2013, our Board of Directors authorized a share repurchase program up to $150.0 million of our outstanding common stock.

Our Board of Directors has authorized various repurchase programs under which we are allowed to purchase shares of our outstanding common stock. Shares repurchased under these programs are accounted for as treasury stock, carried at cost and reflected as a reduction to stockholders’ equity.

Other Comprehensive Income (Loss)

	For the three months ended March 31, 2013
	Pre-Tax			Tax			After-Tax
	(in millions)
Net unrealized losses on available-for-sale securities during the period	$	(132.3	)	$	46.0		$	(86.3	)
Reclassification adjustment for losses included in net income (1)	34.1			(11.7		)	22.4
Adjustments for assumed changes in amortization patterns	43.7			(15.3		)	28.4
Adjustments for assumed changes in policyholder liabilities	(91.9		)	28.1			(63.8		)
Net unrealized losses on available-for-sale securities	(146.4		)	47.1			(99.3		)
Noncredit component of impairment losses on fixed maturities, available-for-sale during the period	(20.2		)	7.1			(13.1		)
Adjustments for assumed changes in amortization patterns	1.2			(0.2		)	1.0
Adjustments for assumed changes in policyholder liabilities	1.4			(0.6		)	0.8
Noncredit component of impairment losses on fixed maturities, available-for-sale (2)	(17.6		)	6.3			(11.3		)
Net unrealized gains on derivative instruments during the period	32.6			(10.8		)	21.8
Reclassification adjustment for gains included in net income (3)	(0.5		)	0.1			(0.4		)
Adjustments for assumed changes in amortization patterns	1.0			(0.4		)	0.6
Net unrealized gains on derivative instruments	33.1			(11.1		)	22.0
Foreign currency translation adjustment	55.1			(0.7		)	54.4
Amortization of prior service cost and actuarial loss included in net periodic benefit cost (4)	21.2			(7.4		)	13.8
Net unrecognized postretirement benefit obligation	21.2			(7.4		)	13.8
Other comprehensive loss	$	(54.6	)	$	34.2		$	(20.4	)

	For the three months ended March 31, 2012
	Pre-Tax			Tax			After-Tax
	(in millions)
Net unrealized gains on available-for-sale securities during the period	$	333.1		$	(112.2	)	$	220.9
Reclassification adjustment for losses included in net income (1)	10.5			(3.9		)	6.6
Adjustments for assumed changes in amortization patterns	(55.5		)	19.4			(36.1		)
Adjustments for assumed changes in policyholder liabilities	(52.0		)	21.9			(30.1		)
Net unrealized gains on available-for-sale securities	236.1			(74.8		)	161.3
Noncredit component of impairment losses on fixed maturities, available-for-sale during the period	(4.9		)	1.6			(3.3		)
Adjustments for assumed changes in amortization patterns	3.8			(1.4		)	2.4
Noncredit component of impairment losses on fixed maturities, available-for-sale (2)	(1.1		)	0.2			(0.9		)
Net unrealized losses on derivative instruments during the period	(43.8		)	15.3			(28.5		)
Reclassification adjustment for losses included in net income (3)	9.7			(3.4		)	6.3
Adjustments for assumed changes in amortization patterns	28.8			(10.1		)	18.7
Net unrealized losses on derivative instruments	(5.3		)	1.8			(3.5		)
Foreign currency translation adjustment	55.7			3.9			59.6
Amortization of prior service cost and actuarial loss included in net periodic benefit cost (4)	13.4			(4.7		)	8.7
Net unrecognized postretirement benefit obligation	13.4			(4.7		)	8.7
Other comprehensive income	$	298.8		$	(73.6	)	$	225.2

(1) Pre-tax reclassification adjustments relating to available-for-sale securities are reported in net realized capital gains (losses) on the consolidated statements of operations.

(2) Represents the net impact of (1) unrealized gains resulting from reclassification of previously recognized noncredit impairment losses from OCI to net realized capital gains (losses) for fixed maturities with bifurcated OTTI that had additional credit losses or fixed maturities that previously had bifurcated OTTI that have now been sold or are intended to be sold and (2) unrealized losses resulting from reclassification of noncredit impairment losses for fixed maturities with bifurcated OTTI from net realized capital gains (losses) to OCI.

(3) See Note 5, Derivative Financial Instruments — Cash Flow Hedges, for further details.

(4) Pre-tax amortization of prior service cost and actuarial loss included in net periodic benefit cost, which is comprised of amortization of prior service cost (benefit); recognized net actuarial (gain) loss and amounts recognized due to special events, is reported in operating expenses on the consolidated statements of operations. See Note 7, Employee and Agent Benefits — Components of Net Periodic Benefit Cost, for further details.

Accumulated Other Comprehensive Income

				Noncredit
	Net unrealized			component of			Net unrealized			Foreign			Unrecognized			Accumulated
	gains on			impairment losses			gains (losses) on			currency			postretirement			other
	available-for-sale			on fixed maturities			derivative			translation			benefit			comprehensive
	securities			available-for-sale			instruments			adjustment			obligation			income
	(in millions)
Balances at January 1, 2012	$	860.7		$	(167.2	)	$	34.9		$	(95.9	)	$	(361.1	)	$	271.4
Other comprehensive income during the period, net of adjustments	154.7			(0.9		)	(9.8		)	58.8			—			202.8
Amounts reclassified from AOCI	6.6			—			6.3			—			8.7			21.6
Other comprehensive income	161.3			(0.9		)	(3.5		)	58.8			8.7			224.4
Balances at March 31, 2012	$	1,022.0		$	(168.1	)	$	31.4		$	(37.1	)	$	(352.4	)	$	495.8
Balances at January 1, 2013	$	1,418.3		$	(173.9	)	$	(8.7	)	$	(106.9	)	$	(488.5	)	$	640.3
Other comprehensive income during the period, net of adjustments	(121.7		)	(11.3		)	22.4			55.5			—			(55.1		)
Amounts reclassified from AOCI	22.4			—			(0.4		)	—			13.8			35.8
Other comprehensive loss	(99.3		)	(11.3		)	22.0			55.5			13.8			(19.3		)
Balances at March 31, 2013	$	1,319.0		$	(185.2	)	$	13.3		$	(51.4	)	$	(474.7	)	$	621.0

Noncontrolling Interest

Interest held by unaffiliated parties in consolidated entities are reflected in noncontrolling interest, which represents the noncontrolling partners’ share of the underlying net assets of our consolidated subsidiaries. Noncontrolling interest that is not redeemable is reported in the equity section of the consolidated statements of financial position.

The noncontrolling interest holders in certain of our subsidiaries maintain an equity interest that is redeemable at the option of the holder, which may be exercised on varying dates beginning in 2014. Since redemption of the noncontrolling interest is outside of our control, this interest is presented on the consolidated statements of financial position line item titled “Redeemable noncontrolling interest.” If the interest were to be redeemed, we would be required to purchase such interest at a redemption value based on a formula that management intended to reasonably approximate fair value based on a fixed multiple of earnings over a measurement period. As such, the carrying value of the redeemable noncontrolling interest is compared to the redemption value at each reporting period. Any adjustments to the carrying amount of the redeemable noncontrolling interest for changes in redemption value prior to exercise of the redemption option are determined after the attribution of net income or loss of the subsidiary and are recorded in retained earnings.

Following is a reconciliation of the changes in the redeemable noncontrolling interest (in millions):

Balance at January 1, 2012	$	22.2
Net income attributable to redeemable noncontrolling interest	0.2
Foreign currency translation adjustment	0.7
Balance at March 31, 2012	$	23.1
Balance at January 1, 2013	$	60.4
Net income attributable to redeemable noncontrolling interest	0.1
Distributions to redeemable noncontrolling interest	(0.6		)
Foreign currency translation adjustment	(1.0		)
Balance at March 31, 2013	$	58.9