Standard Life Plc · LSE:SDLF
Standard Life — Phoenix Group Holdings — BofAML CEO Conference 2019
13 slides from Standard Life's conference presentation, September 2019
Slide 1: Cash Resilience Growth
Cash Resilience Growth Europe’s Largest Life and Pensions Consolidator September 2019 1
Slide 2: A world of extremes
A world of extremes NO-DEAL BREXIT MARKET VOLATILITY CLIMATE CHANGE CHANGING CUSTOMER PREFERENCES BIFURCATING INSURANCE INDUSTRY 2
Slide 3: Phoenix is ready for a 'No-Deal Brexit'
Phoenix is ready for a ‘No-Deal Brexit’ ? CHALLENGE SOLUTION IMPLICATIONS • EU customers’ • EU policies were • £250 million capital policies written by moved to an Irish injection into Irish branches of the UK subsidiary via Part subsidiary based insurance VII transfer company Standard completed i
Slide 4: Markets continue to reach new extremes
Markets continue to reach new extremes …whilst credit spreads have been stable at Interest rates are lower for longer(1)… lower levels(2) UK A-rated corporate UK 15 year swap curve spreads to swaps FY 2018 - YTD 2019 FY 2018 - YTD 2019 % Bps 6 700 600 5 500 4 400 3 300 2 200 1 100 0 0 2008 2009 2010
Slide 5: Phoenix is resilient to market volatility
Phoenix is resilient to market volatility HY19 market risk sensitivities(1,2) Key messages Impact on SII ratio • Phoenix has a low 40% appetite for market risk 30% 20% • Hedging programme 10% brings resilience to the Solvency II surplus 0% -10% • Lower volatility than -20% peers with regard to marke
Slide 6: Life insurers are less directly exposed to physical risks of climate change than general insurers
Life insurers are less directly exposed to physical risks of climate change than general insurers… … however the transition to a low carbon economy impacts investments on our balance sheet INVESTMENT STRATEGY ‒ Integration of sustainability considerations within investment portfolios ‒ ESG focused p
Slide 7: Phoenix's in-force business is relatively immune to changing customer preferences
Phoenix’s in-force business is relatively immune to changing customer preferences Drivers of change Recent regulatory changes and evolving customer preferences have led to an evolution in insurance products Sandwich Workplace Pension generation pensions freedoms Digitalisation Phoenix’s £12 bill
Slide 8: Equity release mortgages offer a solution to customers who are asset rich and cash poor
Equity release mortgages (ERM) offer a solution to customers who are asset rich and cash poor Changing customer preferences Sales of ERM products by value(1) Value Over 55’s account for 65% of £8bn property wealth(2) £7bn £6bn Demographic is asset rich and cash poor £5bn £4bn £3bn ERM provides a sol
Slide 9: Bifurcation of the insurance industry drives consolidation opportunities
Bifurcation of the insurance industry drives consolidation opportunities Vertically integrated Changing corporate focus in life Standard Life transaction is an life insurance company insurance sector example of this evolution Under- writing Capital- heavy Adminis- tration Asset management Investment
Slide 10: The closed life market is large, growing and consolidating
The closed life market is large, growing and consolidating 2016 2019 5% 4% 26% 28% c.£540bn c.£580bn 70% 67% UK Germany Ireland 10
Slide 11: Phoenix delivers cash, resilience and growth
Phoenix delivers cash, resilience and growth CASH RESILIENCE GROWTH NEW BUSINESS DEPENDABLE LONG- TERM CASH GENERATION STRONG BALANCE SHEET BRINGS SUSTAINABILITY TO CASH GENERATION STABLE AND HEDGING STRATEGY £1.0 BILLION SUSTAINABLE DIVIDEND BRINGS RESILIENCE TO MARKET RISKS FUNDING CAP
Slide 12: Thank you.
Thank you. 12
Slide 13: Disclaimer and other information
Disclaimer and other information • This presentation in relation to Phoenix Group Holdings plc and its subsidiaries (the ‘Group’) contains, and we may make other statements (verbal or otherwise) containing, forward-looking statements and other financial and/or statistical data about the Group’s curr