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CNO Financial earnings fall on recapitalization charge

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Carmel-based CNO Financial Group on Monday reported a third-quarter loss of $5 million, or 2 cents a share, compared to a $179.5 million, or 61 cent-per-share, profit in the third quarter of 2011.

Earnings were hurt mostly by a $176.4 million after-tax charge related to refinancing of debt earlier this year.

Revenue rose to nearly $1.1 billion, up from $992.3 million in last year's third quarter.

“Our recently completed recapitalization further strengthened our balance sheet, while increasing financial flexibility and lowering our ongoing costs,” said CEO Ed Bonach in a prepared statement.

CNO, the parent of insurers Bankers Life, Washington National and Colonial Penn, had sales of $94 million, as measured in new annualized premiums, in the most recent quarter, an increase of 1 percent from the same time last year.

CNO’s biggest unit, Chicago-based Bankers Life, posted sales of $80.6 million versus $79.4 million in the quarter a year ago. Sales at Washington National grew to $33.9 million, from $21.2 million. Losses widened at Colonial Penn, to a loss of $2.6 million from a $1.3 million loss a year earlier.

Revenue from other CNO business lines, including several being phased out, were down $53.6 million in the third quarter.

CNO posted an after-tax charge of $13.4 million relating to previously settled legal cases.

Earlier this year, CNO recorded a charge of $20 million from the tentative settlement of a legal dispute involving changes made late last year to certain life policies sold by CNO subsidiary Conseco Life Insurance Co.

Under the tentative settlement, the cost-of-insurance increase implemented by Conseco Life beginning in November will be reduced for certain policyholders. Holders whose policies terminated after November can reinstate their policies with the cost reduction or elect to take a cash-settlement option.

Also this year, the company said it agreed to pay $9.9 million to settle allegations by regulators in four states that its Bankers Life subsidiary acted as an investment adviser and broker-dealer without proper licensing. Those states are Maine, New Hampshire, Vermont and Missouri.

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  1. The east side does have potential...and I have always thought Washington Scare should become an outlet mall. Anyone remember how popular Eastgate was? Well, Indy has no outlet malls, we have to go to Edinburgh for the deep discounts and I don't understand why. Jim is right. We need a few good eastsiders interested in actually making some noise and trying to change the commerce, culture and stereotypes of the East side. Irvington is very progressive and making great strides, why can't the far east side ride on their coat tails to make some changes?

  2. Boston.com has an article from 2010 where they talk about how Interactions moved to Massachusetts in the year prior. http://www.boston.com/business/technology/innoeco/2010/07/interactions_banks_63_million.html The article includes a link back to that Inside Indiana Business press release I linked to earlier, snarkily noting, "Guess this 2006 plan to create 200-plus new jobs in Indiana didn't exactly work out."

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  4. Please go back re-read your economics text book and the fine print on the February 2014 CBO report. A minimum wage increase has never resulted in a net job loss...

  5. The GOP at the Statehouse is more interested in PR to keep their majority, than using it to get anything good actually done. The State continues its downward spiral.

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