Slide 1: 4Q23 Investor Update
4Q23 INVESTOR UPDATE Expanding access to investing, insurance, and retirement security
Slide 2: Prudential Investment Thesis
PRUDENTIAL INVESTMENT THESIS ROCK SOLID DIFFERENTIATED DISCIPLINED Demonstrated financial Thoughtful strategies and Positioned for strength mutually reinforcing business long-term growth system produce differentiated outcomes TRANSFORMING TO BECOME A HIGHER GROWTH, LESS MARKET SENSITIVE, MORE NIMBLE
Slide 3: Integrated Set of Businesses at Scale with Long-Term Growth Potential
INTEGRATED SET OF BUSINESSES AT SCALE WITH LONG-TERM GROWTH POTENTIAL Earnings Contribution(1) Key Statistics PGIM 9% Revenues(2): $51B International Adjusted Book Value Per Share(3): $96.64 Businesses $5.5 42% billion U.S. Employees(4): Approx. 40,000 Businesses 49% Adjusted Dividend Yield(5): 5% (
Slide 4: Differentiated Mutually Reinforcing Business System
DIFFERENTIATED MUTUALLY REINFORCING BUSINESS SYSTEM BRAND Deeply connected INSURANCE & businesses that help RETIREMENT SCALE one another grow, unlocking value for QUALITY our shareholders OPEN- ARCHITECTURE SOLUTIONS REINSURANCE/ GLOBAL THIRD-PARTY INVESTMENT MANAGEMENT PGIM CAPITAL EXPERTISE 4
Slide 5: Competitive Advantages Support Strategic Execution
COMPETITIVE ADVANTAGES SUPPORT STRATEGIC EXECUTION Leverage our Strengths: Execute on Strategic Priorities: • Leading global asset manager Invest in growth businesses and markets around the world • Best-in-class liability origination • Cross-business synergies Deliver industry-leading customer and c
Slide 6: Transforming Our Business for Sustainable Growth
TRANSFORMING OUR BUSINESS FOR SUSTAINABLE GROWTH • Completed $10B traditional variable annuity reinsurance Reducing market transaction sensitivity and • Closed $10B structured settlement annuity reinsurance increasing capital transaction with Prismic efficiency • Announced $12.5B guaranteed universa
Slide 7: Navigating the Macro Environment with Our Rock Solid Balance Sheet
NAVIGATING THE MACRO ENVIRONMENT WITH OUR ROCK SOLID BALANCE SHEET Capital continues to support AA rating level as of December 31(1), 2023(1) Highly liquid assets of $4.1 billion(2) Financial strength to support all stakeholders High quality, well diversified investment portfolio Disciplined Asset L
Slide 8: Maintaining Balanced and Disciplined Capital Deployment
MAINTAINING BALANCED AND DISCIPLINED CAPITAL DEPLOYMENT Board authorized share Investing in businesses for Returned over $700 million repurchases of up to $1B in long-term, sustainable to shareholders in 4Q23(1) 2024 and the 16th consecutive growth year of dividend increases Creating sustainable, pr
Slide 9: Continued Commitment to Long-Term Sustainability
CONTINUED COMMITMENT TO LONG-TERM SUSTAINABILITY Investing Environmental Societal Impact Governance Sustainably Stewardship $1B+ 9 Years $37.5B 55% donated by The Prudential of consecutively being in sustainable decrease in Scope 1 & 2 Foundation to eliminate recognized as one of the investments(3)
Slide 10: Rock Solid: Demonstrated Financial Strength
ROCK SOLID DEMONSTRATED FINANCIAL STRENGTH
Slide 11: Robust Approach to Capital & Liquidity Management
ROBUST APPROACH TO CAPITAL & LIQUIDITY MANAGEMENT Risk Appetite Financial Strength Liquidity Framework “AA” standards Significant resources Capitalized to remain for capital available competitive under stress scenarios 11
Slide 12: Demonstrated Financial Strength
DEMONSTRATED FINANCIAL STRENGTH Objectives Position • Parent company liquid assets of $3 to $5 billion • Parent company highly liquid assets of $4.1 billion(1) • U.S. and Japan regulatory capital ratios consistent with • PICA RBC ratio > 425%(2) AA objectives • Prudential of Japan solvency margin ra
Slide 13: Preserving Balance Sheet Strength, as We Have Done for 145+ Years
PRESERVING BALANCE SHEET STRENGTH, AS WE HAVE DONE FOR 145+ YEARS Stress Parameters Our Toolbox Outcomes • Disciplined ALM and hedging • Maintain appropriate and Equity Market Decline competitive regulatory capital • On-balance sheet capital levels at insurance companies capacity • Maintain adequate
Slide 14: Broadly Diversified, High Quality Investment Portfolio
BROADLY DIVERSIFIED, HIGH QUALITY INVESTMENT PORTFOLIO Portfolio Composition(1) $376 billion Highlights: Other Equities/Alts 5% 5% • Broadly diversified, high quality portfolio with strong Asset Liability Management Government – High allocation to government securities Mortgage Securities (mostly U.
Slide 15: Adjusted Asset Leverage In-Line with Peers
ADJUSTED ASSET LEVERAGE IN-LINE WITH PEERS Asset Leverage(1) Adjustments Adjusted Asset Leverage Exclude non-credit risk assets(2): • For example: government 12.1x bonds, assets supporting experience-rated contractholder liabilities(3), and 7.5x equities, etc. 6.8x 6.6x Exclude Closed Block(3): • Ri
Slide 16: Balanced Approach to Capital Allocation
BALANCED APPROACH TO CAPITAL ALLOCATION Shareholder Distributions 1. Maintain Financial Strength ($ millions) $4,321 $4,144 2. Organic Growth at Attractive Returns $3,245 $3,322 $3,026 $2,500 $2,850 $2,550 $2,500 $1,500 3. Sustainable and Growing Dividends $2,269 $1,000 $2,000 $1,500 $1,250 $500 4.
Slide 17: Double-Digit Dividend Growth Supported by Strong Earnings and Cash Flow Coverage
DOUBLE-DIGIT DIVIDEND GROWTH SUPPORTED BY STRONG EARNINGS AND CASH FLOW COVERAGE ($ per share) Annual Dividends $5.00 $4.80 $4.60 $4.40 $4.00 15% $3.60 CAGR $2.44 $2.80 $3.00 43% $2.17 2023 Dividend $1.60 $1.73 Payout Ratio(1) $1.45 $1.15 $0.58 $0.70 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Slide 18: Differentiated
DIFFERENTIATED THOUGHTFUL STRATEGIES AND MUTUALLY REINFORCING BUSINESS SYSTEM PRODUCE DIFFERENTIATED OUTCOMES
Slide 19: A Leading Global Investment Manager Across Private and Public Asset Classes
PGIM A LEADING GLOBAL INVESTMENT MANAGER ACROSS A BROAD RANGE OF PRIVATE AND PUBLIC ASSET CLASSES Earnings Contribution(1) Business Highlights: ($ millions) • Diverse product offering with scale – Attractive asset classes, client segments, and $713 worldwide geographic presence • Strong investment p
Slide 20: Broad Business Portfolio with Robust Liability Origination Capabilities
U.S. Businesses BROAD BUSINESS PORTFOLIO WITH ROBUST LIABILITY ORIGINATION CAPABILITIES Earnings Contribution(1) Business Highlights: ($ millions) • Diverse customer base with further growth potential across demographics • Complementary solutions across businesses U.S. Businesses • Strong multi-chan
Slide 21: Leading Distribution Model with End-to-End Customer Engagement
U.S. Businesses LEADING DISTRIBUTION MODEL WITH END-TO-END CUSTOMER ENGAGEMENT Distribution through a Ability to meet customers wide range of channels where and how they want In Person Hybrid Digital • Financial professionals Individuals • Direct-to-consumer • Pension plan sponsors Institutions • Re
Slide 22: Market Leader in Japan with Expanding Presence in Growth Markets
International Businesses MARKET LEADER IN JAPAN WITH EXPANDING PRESENCE IN GROWTH MARKETS Earnings Contribution(1) Business Highlights: ($ millions) • Best in class, profitable Japanese franchise consistently maintaining market leadership position • Expand in select, high growth emerging $3,183 Inte
Slide 23: Attractive Mix of Developed and Emerging Markets Provide Long-Term Growth
International Businesses ATTRACTIVE MIX OF DEVELOPED AND EMERGING MARKETS PROVIDE LONG-TERM GROWTH Developed: Japan Emerging Markets • Highly productive distribution system; • Expanding economies and rising affluent world class captive agents, and middle class: Latin America, China, complemented by
Slide 24: Disciplined: Positioned for Long-Term Growth
DISCIPLINED POSITIONED FOR LONG-TERM GROWTH
Slide 25: Execution on Strategy Driving Growth
PGIM EXECUTION ON STRATEGY DRIVING GROWTH Alternatives Growth opportunities International from: Retail 25
Slide 26: Broad Geographic Presence in Key Markets
PGIM BROAD GEOGRAPHIC PRESENCE IN KEY MARKETS With 1,450+ investment professionals located across 45 offices in 18 countries, our experts are present in key financial centers around the world. DUBLIN LETTERKENNEY AMSTERDAM TORONTO LONDON FRANKFURT PARIS MUNICH MINNEAPOLIS CHICAGO BOSTON ZÜRICH MILAN
Slide 27: Growth in Alternatives
PGIM GROWTH IN ALTERNATIVES Investments for Market Opportunity(1) PGIM’s Positioning Future Growth ($ trillions) • Formed PGIM Private Alternatives, bringing together the 8% Alternatives(2) $324B firm’s private alternative CAGR $24.5 capabilities • Acquired Montana Capital Top 3 in Partners, a ~$3B
Slide 28: Significant Opportunity Outside the U.S.
PGIM SIGNIFICANT OPPORTUNITY OUTSIDE THE U.S. • Top 3 foreign manager of Japanese Institutional assets Japan ~$197B in Assets • Increased appetite for non-Japan assets • AUM from European clients grew 23% over the past five years Europe • Significantly increased sales and marketing footprint in Euro
Slide 29: Momentum in U.S. Retail
PGIM MOMENTUM IN U.S. RETAIL Investments for Market Opportunity(1) PGIM’s Positioning Future Growth • 13 out of 15 years of • Continue to build on 21% positive mutual fund net strategic partner status flows(2) with key intermediaries $27 50% trillion • Institutional approach to • Scale up suite of s
Slide 30: Building on a Strong Core
U.S. Businesses BUILDING ON A STRONG CORE Strengthening our foundational businesses Growth Enhancing customer and opportunities advisor experiences from: Expanding in our chosen markets to accelerate growth 30
Slide 31: Strengthening Our Foundational Businesses
U.S. Businesses STRENGTHENING OUR FOUNDATIONAL BUSINESSES • Expanding access to retirement security, broadening distribution through new Retirement relationships, platforms, and advisors Strategies • Delivering industry-leading strategies for growth and protection that create stakeholder value acros
Slide 32: Enhancing Capabilities to Simplify Customer and Advisor Experiences
U.S. Businesses ENHANCING CAPABILITIES TO SIMPLIFY CUSTOMER AND ADVISOR EXPERIENCES Building a culture of continuous improvement… Process Customer Digital Simplification and Onboarding Enablement Automation Optimization …to drive enhancements for customers and advisors while realizing cost savings 3
Slide 33: Expanding in Our Chosen Markets to Accelerate Growth
U.S. Businesses EXPANDING IN OUR CHOSEN MARKETS TO ACCELERATE GROWTH As more individuals near retirement… …many are financially unprepared How we solve it and grow: • Simplified and affordable products +20% • Complementary distribution 89M $40T Unprotected nest egg assets channels that meet diverse
Slide 34: Expanding Market Share
International Businesses EXPANDING MARKET SHARE Continuing market leadership in Japan Growth opportunities from: Expanding our presence in select, high growth emerging markets 34
Slide 35: Well Positioned for Continued Outperformance in Japan
International Businesses WELL POSITIONED FOR CONTINUED OUTPERFORMANCE IN JAPAN Adept at Highly Skilled Customer Product Distribution Focused Evolution 35
Slide 36: Leverage Our Partnerships with Market-Leading Companies in Emerging Markets
International Businesses LEVERAGE OUR PARTNERSHIPS WITH MARKET-LEADING COMPANIES FOR FUTURE GROWTH IN EMERGING MARKETS Latin America Africa Asia Brazil South Africa China Leading provider of integrated Largest private sector bank in Brazil and a independent advice together with Global innovation-dri
Slide 37: Prudential Investment Thesis
PRUDENTIAL INVESTMENT THESIS ROCK SOLID DIFFERENTIATED DISCIPLINED Demonstrated financial Thoughtful strategies and Positioned for strength mutually reinforcing business long-term growth system produce differentiated outcomes TRANSFORMING TO BECOME A HIGHER GROWTH, LESS MARKET SENSITIVE, MORE NIMBLE
Slide 38: Appendix
APPENDIX
Slide 39: Sources of Rankings
SOURCES OF RANKINGS BUSINESS MARKET POSITION SOURCE Pensions & Investments Top Real Estate Managers list, published Top 3 Real Estate Manager October 9, 2023. AUM as of June 30, 2023. PGIM Japan, based on the total AUM for discretionary managed Top 3 Foreign Manager of PGIM accounts as of the end of
Slide 40: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Certain of the statements included in this presentation, including those relating to Prudential Financial, Inc.’s and its subsidiaries’ financial strength, strategy, growth prospects and market opportunities, our plans to reposition our business and become a higher growth,
Slide 41: Non-GAAP Measures
NON-GAAP MEASURES This presentation includes references to adjusted operating income, adjusted book value, and adjusted operating return on equity, which is based on adjusted operating income and adjusted book value. Consolidated adjusted operating income, adjusted book value, and adjusted operating
Slide 42: Non-GAAP Measures (Continued)
NON-GAAP MEASURES (CONTINUED) Realized investment gains (losses) within certain businesses for which such gains (losses) are a principal source of earnings, and those associated with terminating hedges of foreign currency earnings and current period yield adjustments, are included in adjusted operat
Slide 43: Earnings by Business
EARNINGS BY BUSINESS ($ millions) Full Year 2023 Adjusted operating income (loss) before income taxes PGIM $ 713 U.S. Businesses: Institutional Retirement Strategies 1,695 Individual Retirement Strategies 1,873 Group Insurance 319 Individual Life (95) Total U.S. Businesses 3,792 International Busine
Slide 44: Reconciliations Between Adjusted Operating Income and the Comparable GAAP Measure
RECONCILIATIONS BETWEEN ADJUSTED OPERATING INCOME AND THE COMPARABLE GAAP MEASURE ($ millions, except per share data) Full Year 2023 Net income attributable to Prudential Financial, Inc. $ 2,488 Income attributable to noncontrolling interests 20 Net income 2,508 Less: Earnings attributable to noncon
Slide 45: Reconciliations Between Adjusted Book Value and the Comparable GAAP Measure
RECONCILIATIONS BETWEEN ADJUSTED BOOK VALUE AND THE COMPARABLE GAAP MEASURE ($ millions, except per share data) December 31, 2023 GAAP book value $ 27,820 Less: Accumulated other comprehensive income (AOCI) (6,504) GAAP book value excluding AOCI 34,324 Less: Cumulative change in fair value of funds