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Manulife Financial Corp MFC-T shares fell to their lowest level since January 2021 after its first-quarter earnings declined due to lower sales and new business in Asia as COVID-19 infections rose in some parts of the region.

Canada’s biggest life insurer could see further impact from the pandemic despite an ebb in cases and lifting of restrictions, executives said on Thursday.

“In Q1 of this year, we saw a really unprecedented resurgence of COVID in Hong Kong, but also in other markets in Asia,” Manulife Chief Executive Roy Gori said on an analyst call.

“It’s temporary in nature... but it’s not necessarily true that we’ll see an immediate bounceback in one quarter,” he said, adding that the company still believes the “Asia opportunity is undeniable.”

CIBC analysts said in a note that persistent growth challenges in Asia meant the company could miss analysts’ expectations for the fiscal year.

Manulife shares dropped 7.8 per cent to $22.34, their lowest intraday level since January 2021. The broader Toronto stock benchmark fell 1.1 per cent.

Manulife on Wednesday reported a decrease in core earnings and missed analysts’ expectations, as a decline in sales and new business in Asia offset increases in Canada and the United States.

The company reiterated that it still aims to achieve half of core earnings from Asia by 2025.

Rival Sun Life also reported a decline in earnings, also driven by the resurgence of the pandemic in Hong Kong, as well as higher claims from the United States, although it beat expectations.

Its shares fell 1.5 per cent to $61.74.

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