NEW YORK (Bloomberg)—CNA Financial Corp., the insurer that hasn’t paid a common stock dividend since 2008, must manage capital carefully so it can expand when markets improve, said the CEO of the company’s parent, Loews Corp.

“CNA will manage itself very conservatively,” Loews CEO Jim Tisch said Wednesday in an interview at Bloomberg headquarters in New York. “CNA will want to be in a position when the markets improve that it can service its clients and actually grow its business.”

CNA, which has reported five straight quarterly profits, is prohibited from reviving the dividend until it repays $500 million owed to Loews on a $1.25 billion preferred-stock issuance completed during the financial crisis. Chicago-based CNA is paying a 10% annual coupon on the investment and needs Loews’s consent to redeem the preferred shares. Mr. Tisch declined to give a timeframe.

“Hopefully in the not-too-distant future it will be able to repay the other $500 million,” Mr. Tisch said. “Once it’s done then it’s free to pay dividends. That’s the way it could return capital to shareholders.”

CNA, 90%-owned by Loews, went to its parent for capital amid investment declines and three quarterly losses at the end of 2008 and beginning of last year. The insurer reduced the amount it owed to Loews from $1 billion this month after completing a $500 million sale of notes.

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