Lincoln National Corporation · NYSE:LNC
Lincoln National — J.P. Morgan 2010 Insurance Conference
20 slides from Lincoln National's conference presentation, Mar 22, 2010
Slide 1: J.P. Morgan 2010 Insurance Conference
Exhibit 99.1 J.P. Morgan 2010 Insurance Conference March 22, 2010 Fred Crawford Chief Financial Officer Lincoln Financial Group ©2010 Lincoln National Corporation
Slide 2: Safe Harbor
Safe Harbor This presentation and certain oral statements made on LNC’s behalf may contain information that includes or is a “forward-looking statement” within the meaning of the Private Securities Litigation Reform Act of 1995 (“PSLRA”). A forward-looking statement is a statement that does not stri
Slide 3: Clearly Focused on Four Core Insurance and Retirement Businesses
Clearly Focused on Four Core Insurance and Retirement Businesses Earnings1 2010 Focus Defined • Defined Contribution Contribution 11% – Invest in technology and service Group platforms Protection • Group Protection 11% – Expand voluntary sales efforts and develop products for new distribution channe
Slide 4: Market Leading Franchise Intact
Market Leading Franchise Intact Solid Deposits, Positive Net Flows $8 Consolidated Retirement & Insurance Deposits Solid Business Model $6 4.8 4.8 4.8 5.3 4.9 • Market share gains in major $4 lines of business $2 • Updated flagship products • 22% increase in wholesaler $0 productivity in 2009 • 26 n
Slide 5: Fourth Quarter Results
Fourth Quarter Results Sequential Growth in Account Values and Earnings 2009 Income From Operations Adjusted for Earnings Drivers Improving Notable Items1 $2992 • Insurance Solutions: $2632 $228 – Stable growth rates $217 Life Insurance – Capital solution impact in 2010 Group Protection – Strong gro
Slide 6: Insurance and Protection Businesses
Insurance and Protection Businesses Outlook: Stable and Building Returns Life GAAP Reserves $43b Return on Capital1 VUL 14% Life Segment 10% Whole Life 10% • Stable returns with building UL 41% in-force and account vales MG 8% • Reinsurance and XXX transactions Term 3% UL SG 24% impact on 2010 segme
Slide 7: Retirement Returns
Retirement Returns Diverse Portfolio Driving Balanced Returns Fixed Portion of Return on Capital1 Individual Variable Individual Fixed Annuities 4% Annuities 14% Individual Annuities 15% • Average account values recovering DC Variable • Positive flows expected to continue as Annuities1 12% productiv
Slide 8: Individual Variable Annuities
Individual Variable Annuities Proven Risk Management and Full Economic Hedge Individual VA Living Benefits Reserve Metrics Guaranteed Income No 12/31/08 12/31/09 Guarantee Benefit 16% 44% LB NAR3 $6.5b $2.6b Guaranteed 40% DB NAR3 $14.8b $6.0b Withdrawal Benefit Hedge Target $3.7b $0.7b Individual V
Slide 9: Portfolio Allocation
Portfolio Allocation 246 236 212 174 Note: All data shown for available-for-sale securities. All realized loss data presented on a pre-DAC and tax basis; excludes losses on derivatives; includes losses on sold securities. 2009 reflects the adoption of FASB Staff Position No. FAS 115-2 and 124-2. 9 *
Slide 10: Insurance Company Capitalization
Insurance Company Capitalization Capital Positioned to Withstand Stressed Markets • Year-end activities - closed on long-term life capital solution, adopted VACARVM and new NAIC RMBS treatment • RBC at 450% - positioned to absorb economic weakness, support new business growth rates, and allows patie
Slide 11: Financial Flexibility
Financial Flexibility Excess Holding Company Liquidity and Ready Capital Capital & Liquidity Strategy: • $1b of liquid investments with $100mm of commercial • Target $300-500 million paper issued* of liquid investments at the • Closed Delaware sale on holding company January 4th for $410mm • Targeti
Slide 12: The CPP Exit Question
The CPP Exit Question “We expect to repay CPP funds in the second half of 2010 or first half of 2011 or as market conditions dictate and without diluting operating earnings per share. “ “…as market conditions dictate”: – Pace of economic recovery and impact on capital conditions – The health of the
Slide 13: Questions
@ Lincoln Financial Groupe Hello future®
Slide 14: Appendix
Appendix [ Lincoln Financial Groupe Hello future®
Slide 15: Definition of Income (Loss) From Operations and ROE
Definition of Income (Loss) From Operations and ROE Definition of Income (Loss) from Operations: Income (loss) from operations as used in this document is a non-GAAP financial measure and is not a substitute for net income (loss) calculated using GAAP measures. Income (loss) from operations is the p
Slide 16: Net Income to Income from Operations Reconciliation
Net Income to Income from Operations Reconciliation ($ in millions, except per share data) 1Q09 3Q09 4Q09 Net Income (Loss) available to common stockholders $(579.0) $137.0 $84.1 Less: Preferred stock dividends and accretion of discount (16.3) (18.2) Minority adjustment (0.1) Net Income (Loss) (578.
Slide 17: 1Q 2009 Income From Operations
1Q 2009 Income From Operations Schedule of Notable Items Retirement Solutions Insurance Solutions Life ($ in millions) Annuities Insurance Reported 74 30 142 26 (108) DAC Unlocking Tax-related items Expenses Other (net) (64) Total 74 142 (44) Alternative (2) Investments* * Reflects actual income or
Slide 18: 2Q 2009 Income From Operations
2Q 2009 Income From Operations Schedule of Notable Items Retirement Solutions Insurance Solutions Life ($ in millions) Annuities Insurance Reported 65 28 133 34 (52) DAC Unlocking Tax-related items Expenses 2 (19) Mortality 5 Other (net) 3 Total 65 123 (33) Alternative (5) (3) (20) (2) Investments*
Slide 19: 3Q 2009 Income From Operations
3Q 2009 Income From Operations Schedule of Notable Items Retirement Solutions Insurance Solutions Life ($ in millions) Annuities Insurance Reported 95 43 137 35 (33) DAC Unlocking 11 5 (12) Tax-related 3 6 items Other 1 Total 80 143 (33) Alternative 2 1 (5) 1 Investments* * Reflects actual income or
Slide 20: 4Q 2009 Income From Operations
4Q 2009 Income From Operations Schedule of Notable Items Retirement Solutions Insurance Solutions Life ($ in millions) Annuities Insurance Reported 120 33 158 30 (44) DAC Unlocking 12 Tax-related 7 (2) 13 items Expenses (1) (3) 4 Disability Business (33) Review Other 1 Total 101 158 (29) Alternative
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