Standard Life Plc · LSE:SDLF
Standard Life — Phoenix Group Holdings — Investor Day (November 2019)
87 slides from Standard Life's investor day presentation, Nov 28, 2019
Slide 1: Cash Resilience Growth: Phoenix Group Capital Markets Day
Cash Resilience Growth Phoenix Group Capital Markets Day 28 November 2019 1
Slide 2: Nicholas Lyons, Chairman
Nicholas Lyons Chairman 2
Slide 3: Phoenix delivers cash, resilience and growth
Phoenix delivers cash, resilience and growth M&A IN-FORCE BUSINESS £12bn LT cash HERITAGE £245bn 10m OPEN GROWTH AUA policies GROWTH OPERATING MODEL 3
Slide 4: Phoenix continues to deliver against its 2019 strategic objectives
Phoenix continues to deliver against its 2019 strategic objectives Cash Resilience Growth (1) (1) £707 £3.0 £235 £205 156% million billion million million 2019 cash generation Q32019 Q32019 YTD2019 Q32019 Estimated PGH Estimated PGH Incremental long- Incremental long- This exceeds the upper end of t
Slide 5: Agenda
Agenda Nicholas Lyons 1 Introduction Chairman Management Andy Moss 2 Managing ourof the in-force in-force business business Chief Executive, Phoenix Life and Group Director, Heritage Business Susan McInnes 3 Growth of the Open business Chief Executive, Standard Life Assurance Limited and Group Direc
Slide 6: Management of the in-force business
M&A MANAGEMENT OF THE IN-FORCE BUSINESS IN-FORCE BUSINESS Andy Moss HERITAGE OPEN GROWTH GROWTH Chief Executive, Phoenix Life and Group Director, Heritage Business OPERATING MODEL 6
Slide 7: We have a well diversified in-force business
We have a well diversified in-force business Diversified in-force business Strategy at 30 June 2019 • To deliver value to shareholders and customers; and • To improve customer outcomes Key attributes of in-force business £245bn Cash Resilience • Organic cash emerges • Strong capital position over ti
Slide 8: Phoenix's in-force business will deliver £12 billion of cash generation
Phoenix’s in-force business will deliver £12 billion of cash generation Illustrative future cash generation £12.0 billion guidance over life of business Includes cash generation from in-force business £8.2bn £3.8 billion 5-year target £600-700m 1-year Excludes new Open target (2) business, BPA and M
Slide 9: Cash generation comes from Life Company free surplus
Cash generation comes from Life Company free surplus Solvency II balance sheet Free Free surplus Own funds surplus • Capital available to distribute to Group as cash generation Capital • Own funds = assets less policy liabilities Capital policy • Assets are fair valued Own funds • Additional capital
Slide 10: Management actions are focused on increasing free surplus
Management actions are focused on increasing free surplus Management actions either… …increase own funds… Or reduce risk capital… 3 Free surplus Free surplus 4 Capital Capital Free policy policy Own surplus Own funds OR Own funds funds Capital policy Risk Risk Risk capital capital capital …and incre
Slide 11: £2.5 billion of cash generated from management actions in the last decade
£2.5 billion of cash generated from management actions in the last decade Core competency of delivering management actions year on year £2,510m £286m £237m £380m £20m £265m Standard Life Assurance £180m acquisition Abbey £332m AXA acquisition acquisition £209m Solvency II effective £359m £242m 2010
Slide 12: We have a long track record of delivering a wide range of management actions
We have a long track record of delivering a wide range of management actions Increase own funds Decrease risk capital Cost efficiencies Reducing risks Improvements in outsourcer cost Hedging of equity, currency and per policy, internal costs or interest rate risk and reinsurance of investment fees l
Slide 13: And a strong pipeline of future management actions
And a strong pipeline of future management actions Cash generation target 2019-2023 Opportunities We will deliver £1.2 billion of management actions by 2023 £3.8bn 2020 2021 2022 2023 Operational Strategic Asset Allocation £1.2bn management Balance sheet optimisation Restructuring Transition cost sy
Slide 14: Our changing environment is a source of opportunities for further management actions
Our changing environment is a source of opportunities for further management actions Cash generation guidance 2024+ Regulatory change Digitalisation • Demand for digitalisation from •• Changes Changes to the to the regulatory regulatory capitalcapital regime bring • Demand for digitalisation from cu
Slide 15: Our approach to risk management brings resilience to free surplus
Our approach to risk management brings resilience to free surplus Solvency II balance sheet • Protect solvency Principles • Optimise free surplus • Deliver resilience Free surplus Capital policy • Board sets an appetite for the sensitivity of Approach free surplus to market and insurance risks Own f
Slide 16: Risk management is a continuous process
Risk management is a continuous process • To gain insight into risks across a plausible stress environment Risk • Informs understanding of risk and exposure • Annual review of risk appetites setting of risk appetite and presented to the Board for appetite approval • 1 in 10 risk appetites are set wi
Slide 17: We use stress and scenario testing to better understand risk exposures
We use stress and scenario testing to better understand risk exposures • 1 in 10 year events run semi-annually • All risks scenario used to set capital • 1 in 20 and 1 in 50 year events are run annually management policy • Used to inform risk appetite • Additional scenarios to respond to recent moni
Slide 18: Case study: Interest rate is a key risk for Phoenix
Case study: Interest rate is a key risk for Phoenix PGH Group undiversified SCR(3) Interest rate risk at 31 December 2018 • Interest rate risk arises where the impact of changes in interest £7.9bn rates differs between assets and liabilities Interest rates £1.0bn 13% • This primarily arises on contr
Slide 19: Case study: dynamic management of interest rate risk delivered £85 million benefit
Case study: Phoenix’s dynamic management of interest rate risk delivered £85 million benefit to Solvency II surplus 15 year swap rates • Regular entity level risk based assessments. At least once a quarter 180 Routine 160.3bps • Existing hedges rebalanced to management adjust for economic movements,
Slide 20: Phoenix's resilience to market risks is strong relative to peers
Phoenix’s resilience to market risks is strong relative to peers HY19 Phoenix Shareholder Capital Coverage Ratio (SCCR) sensitivities relative to Life peers(5) Impact on SII ratio 40% 30% 20% 10% 0% -10% -20% -30% -40% Phoenix Peer A Peer B Peer C Peer D Peer E Peer F Peer G United Kingdom Europe Eq
Slide 21: Key messages
Key messages We have a single strategy for managing Heritage and Open in-force business In-force business will deliver £12 billion of long-term dependable cash generation £2.5 billion of cash generation delivered from management actions in the last decade Our risk management framework brings resilie
Slide 22: Growth of the Open business
M&A GROWTH OF THE OPEN BUSINESS IN-FORCE BUSINESS Susan McInnes HERITAGE OPEN GROWTH GROWTH Chief Executive, Standard Life Assurance Limited and Group Director, Open Business OPERATING MODEL 22
Slide 23: Phoenix's Open business is growing
Phoenix’s Open business is growing Key messages Open business • Open business is capital light and value accretive UK European • Workplace is the engine of the Open business Open SunLife Open • Growth of the Open business is incremental to £12 billion cash generation guidance and enhances • Workplac
Slide 24: £205 million of incremental long-term cash generation from Open business growth
£205 million of incremental long-term cash generation from Open business growth Gross inflows on new New business contribution(6) Long-term cash generation business at 30 September 2019 at 30 September 2019 at 30 September 2019 1% 9% 12% 13% 23% 14% 7% £5.3bn £141m £205m 10% 40% 67% 25% 79% Workplac
Slide 25: Workplace is the engine of the Open business
Workplace is the engine of the Open business • Growth of our workplace business delivers the majority of incremental long-term cash generation • We retain existing clients and compete for new schemes through our strong customer proposition Proven track record 4. We will grow through New schemes Exis
Slide 26: We will deliver workplace growth through…
We will deliver workplace growth through… Building out the proposition Being a trusted guide to the customer ESG Great service Relevant content In-scheme draw down Master Value for money Easy to deal with Trust New Annual Financial Benefit wellness Statements Transforming the platform Passive Open d
Slide 27: Retail pensions – helping customers at all stages of their lifetime
Retail pensions – our aim is to help customers at all stages of their lifetime We offer products across the accumulation and decumulation stages of the life saving cycle Support workplace AMPP DRAWDOWN leavers OFFSHORE BONDS Facilitate Phoenix Customer wealth customers Facilitate pot ONSHORE BONDS c
Slide 28: Customers are moving towards digital first
Customers are moving towards digital first Guided journeys to help customers plan targets, save more and move into drawdown Top-up and pension consolidation functionality generating c. £500 million gross flows YTD Fingerprint and face ID biometric login Secure 2-way mailbox with photo attachment fun
Slide 29: Wrap SIPP is delivered through our important Strategic Partnership
Wrap SIPP is delivered through our important Strategic Partnership Wrap SIPP is a platform product Client Service Proposition Agreement Responsibilities SLA Phoenix • Strong brand Sales • Sold on Standard Life Aberdeen’s platform Advisor relationships • Lower margin but higher volume Platfor
Slide 30: SunLife - building a stand-out over 50s financial services brand
SunLife - Drive value by building a stand-out over 50s financial services brand Primary strategic aims Build Protect and Build over financial grow core 50s services protection proposition retailing business capability • Accelerate new • Enhance direct marketing • Expand into funeral care business gr
Slide 31: The European business focuses on maximising value
The European business focuses on maximising value Our European business has three segments Key messages at 30 June 2019 • We continue to focus on retaining IRELAND customers and growing profitable unit linked business • Unit linked investment pre and 23% GERMANY post retirement proposition focused o
Slide 32: Key messages
Key messages Open business growth delivers incremental cash generation, enhancing dividend sustainability £205 million of incremental long-term cash generation from new business by end Q319 Workplace is the engine of the Open business Building customer relevance supports growth European business is
Slide 33: Growth of the Heritage business
M&A GROWTH OF THE HERITAGE BUSINESS IN-FORCE BUSINESS Simon True HERITAGE OPEN GROWTH GROWTH Group Corporate Development Director and Group Chief Actuary OPERATING MODEL 33
Slide 34: Our Heritage business will grow through new annuity business
Our Heritage business will grow through new annuity business Our annuity book will continue to grow Key messages Annuity business is value accretive; providing £20bn long-term cash flows to support future dividends £10bn Growth through BPA is incremental to our cash generation targets 2019 2020 2021
Slide 35: BPA offers attractive returns and extends our long-term cash generation
BPA offers attractive returns and extends our long-term cash generation Phoenix’s approach to BPA is: 2019 YTD BPA deal economics IRR on each BPA transaction must exceed Focus on value hurdle rate of return Selective accretion not volume “Capital strain” includes the capital 9% management policy All
Slide 36: Our BPA strategy has delivered £485 million of long-term cash generation
Our BPA strategy has delivered £485 million of long-term cash generation We have capitalised on both internal and external opportunities External BPA statistics £4,250m Long-term £289m Capital £144m Liabilities cash strain 1st external £236m generation transaction £462m £1,930m YTD 1st internal £1,1
Slide 37: Factors which enable us to deliver value accretive deals
There are a range of factors which enable us to deliver value accretive deals 2019 Invited to price Deals we priced Deals we won £28bn | 56 deals £5.9bn | 23 deals £1.1bn | 4 deals We priced less than We won 1 deal in every 50% of deals 6 we priced YTD Criteria for pricing Phoenix’s competitive adva
Slide 38: Asset and liability cash flows
Sourcing assets quickly which match liability duration is the key criteria for success in the BPA market Illustrative asset and liability matching profile 12 10 Asset and liability cash flows (£m) 8 6 4 2 - 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34
Slide 39: Our Strategic Asset Allocation for annuities has three key priorities
Our Strategic Asset Allocation (“SAA”) for annuities has three key priorities 1 Appropriate duration 2 Credit discipline 3 Diversification at 30 September 2019 at 30 September 2019 at 30 September 2019 16 years 14% 19% 13 years £20bn £20bn 17% 36% 14% UK Gilt Cash and derivatives ERM AAA Gilts UK Lo
Slide 40: Strong controls and governance ensure we manage risk effectively
Strong controls and governance ensure we manage risk effectively • Asset selection • Credit assessment / due diligence • Approval through governance Risk • Origination through direct sourcing appetite set by the • Quantitative risk appetite or third party mandates • Capital and liquidity requirement
Slide 41: Illiquid assets are an integral, but proportionate part of our annuity SAA
“Illiquid” assets are an integral, but proportionate part of our annuity SAA Annuity SAA Target annuity SAA Key messages at 30 September 2019 Long dated assets “match” our long dated annuity liabilities 11% 20% 14% We are rewarded for illiquidity by higher returns £20bn 20% 60% Internal model fully
Slide 42: Phoenix's approach to origination is bespoke and disciplined
Phoenix’s approach to origination is bespoke and disciplined Sourcing illiquid assets Phoenix’s competitive advantages Direct sourcing Third party mandates We are sourcing assets suitable for both our back-book and new business Average 60+ direct relationships with Leverage expertise, market dea
Slide 43: 2019 origination delivers diversified assets of appropriate tenor and credit quality
2019 origination delivers diversified assets of appropriate tenor and credit quality Origination focused on longer maturities at attractive spreads Diversified portfolio 300 £50m £92m £100m £36m 250 BBB £50m £34m A AA A- A+ Spread (bps) £77m £78m 200 AA A A+ A- £33m £1.1bn 150 A A A A- BBB- BBB AA A
Slide 44: Independent and robust process to determine credit rating of illiquid assets
We use an independent and robust process to determine the credit rating of our illiquid assets Internal Credit Rating (“ICR”) process for non-ERM illiquids Illiquid asset credit quality at 30 Sept 2019 Annual Cycle 3rd party asset manager Phoenix 1% 7% Draft and approve asset Approve framework of as
Slide 45: Our £5 billion illiquid asset portfolio is well diversified
Our £5 billion illiquid asset portfolio is well diversified at 30 September 2019 Equity Release Mortgages £2.7 billion UK Local Authority Loans £0.4 billion 5% • Broad regional spread and average LTV 9% • Unsecured but with implicit support of of 33% UK Government • Average AA credit rating • Averag
Slide 46: Our Equity Release Mortgage portfolio is highly resilient and well diversified
Our Equity Release Mortgage portfolio is highly resilient and well diversified Credit rating determined through securitisation Key portfolio statistics at 30 September 2019 18% Average AAA Average Average time to 11% AA LTV age £2.7bn Current redemption 57% A portfolio 14% Awaiting securitisation 33
Slide 47: Strong security over our £2 billion portfolio of other illiquid assets
We have strong security over our £2 billion portfolio of other illiquid assets Commercial Real Estate £0.5 billion Private Placements £1.1 billion • First-ranking security over the underlying property, transaction • 72% secured on a variety of assets bank accounts and other borrower assets • Diversi
Slide 48: Investing in assets brings a positive social impact
Investing in assets brings a positive social impact City growth & Social housing Equity release Clean energy Infrastructure regeneration c. £100 million c. £100 million c. £1.1 billion ERM c. £135 million c. £150 million funding to progress investment to help origination, helping investment across i
Slide 49: Key messages
Key messages Heritage business growth delivers incremental cash generation, enhancing dividend sustainability £235 million of incremental long-term cash generation from YTD BPA Sourcing assets that match liability duration is the key criteria for value accretive BPA Illiquid assets are an integral b
Slide 50: Transformation of the operating model
M&A TRANSFORMATION OF THE OPERATING MODEL IN-FORCE BUSINESS HERITAGE OPEN GROWTH GROWTH Tony Kassimiotis Group Chief Operating Officer OPERATING MODEL 50
Slide 51: Our industry is facing a wide range of external challenges
Our industry is facing a wide range of external challenges Risk Regulation management Cost Customer pressure expectations Diminishing Product expertise innovation Digitalisation 51
Slide 52: Phoenix is also bringing together two distinct operating models
Phoenix is also bringing together two distinct operating models “Phoenix” model “Standard Life Assurance” model Heritage business Heritage business Open business End state operating Open business M&A ready model M&A ready Outsourcers Outsourcers Digital Digital 52
Slide 53: Our end state operating model leverages the strengths of our strategic partners
Our end state operating model leverages the strengths of our strategic partners Phoenix Group Customer Financial Asset Services and IT Management Management Hybrid outsourcing Partnership model model In-house Finance and Actuarial Tata Consultancy Services (“TCS”) Standard Life Aberdeen Diligenta 53
Slide 54: Clear strategic aims for our Customer Services and IT operating model
We have clear strategic aims for our Customer Services and IT operating model Improve customer Drive business growth Manage risk outcomes • Improved customer interaction • Support agile deployment of new • Rationalisation of systems propositions and services • Enriched customer data driven • Reduced
Slide 55: Hybrid Customer Services and IT operating model
Hybrid Customer Services and IT operating model brings enhanced capability and operational flexibility B2B Customer MyPhoenix and Standard Life Digital Marketplace Assurance digital Proposition design, access enabled by products, pricing, TCS platform investment solutions and Shared digital enableme
Slide 56: Ingredient 1: Unique partnership and leading contractual framework
Ingredient 1: Unique partnership and leading contractual framework We were a founding partner of Diligenta… …which brings early adopter advantages Tata Consultancy Evergreen contracts Services Ltd • 450,000 consultants • 46 countries Partnership established in 2005 Variable cost base with “per p
Slide 57: Ingredient 2: The TCS BaNCS platform
Ingredient 2: The TCS BaNCS platform TCS BaNCS Insurance End-to-end administration of policies and customer data UK First launched in 2001 and in operation in the UK since 2006 7 17 million customers L&P policies No limits on type of No limit on number of product it can handle policies it can pr
Slide 58: Ingredient 3: Migration expertise at Phoenix and Diligenta
Ingredient 3: Migration expertise at Phoenix and Diligenta Phoenix’s migration journey Pearl, NPI and Ex-RSA, Swiss Life SunLife Direct and 13.4m London Life and Alba policies Phoenix Wealth policies migrated migrated from 8 AXA policies from 11 legacy legacy admin migrated from 3 4.6m admin systems
Slide 59: Ingredient 4: Edinburgh Hub will support Open business development
Ingredient 4: Edinburgh Hub will support Open business development What is the Edinburgh Hub? How does it benefit the Open business? TCS will establish Hub located in our Edinburgh Lothian Road office Combined expertise builds on strong innovation and customer service excellence a technology and o
Slide 60: Key messages
Key messages Phoenix’s operating model leverages the strengths of our preferred strategic partners Policies will be administered from the TCS BaNCS platform and serviced by Diligenta TCS will develop Open business capabilities, delivered from a new Edinburgh Hub Hybrid operating model will retain St
Slide 61: Sustainable long-term cash generation
M&A SUSTAINABLE LONG-TERM CASH IN-FORCE GENERATION BUSINESS HERITAGE OPEN GROWTH GROWTH Rakesh Thakrar Deputy Group Finance Director OPERATING MODEL 61
Slide 62: Phoenix delivers £707 million cash generation in 2019
Phoenix delivers £707 million cash generation in 2019, exceeding the upper end of the target range 2019 cash generation Key messages £957m Cash generation exceeds upper end of target range £(250)m £707m £600m- SLAL £510m £700m target Gross cash generation provides range (2) dividend cover of 2.8x £2
Slide 63: Solvency II surplus unchanged at £3.0 billion
Solvency II surplus unchanged at £3.0 billion illustrating Phoenix’s resilience Own funds increased by £0.2bn(1),(9) SCR increased by £0.2bn(1),(9) Solvency II surplus resilient(1),(9) +£0.2bn +£0.2bn £8.2bn £8.4bn £5.2bn £5.4bn £3.0bn £3.0bn HY19 Q319 HY19 Q319 HY19 Q319 Own Funds SCR Solvency II s
Slide 64: Three pillar approach to identifying available capital and cash
We have a three pillar approach to identifying available capital and cash Capital Liquidity Leverage Minimum Target Target Liquidity 12 months solvency 140-180% leverage xx (10) 25-30% buffer mandatory ratio ratio outflows Rectification Group liquidity buffer Supports investment <140% plan also cove
Slide 65: Framework for capital allocation that brings sustainability to cash generation
And a framework for capital allocation that brings sustainability to cash generation 1 Maintain a strong solvency balance sheet and investment grade rating 2 Support delivery of management actions 3 Maintain a stable and sustainable dividend 4 Invest in value accretive growth opportunities (Open, He
Slide 66: Range of value accretive growth options and clear criteria
We have a range of value accretive growth options and clear criteria for evaluating them Growth options Criteria are balanced to ensure success • Capital allocation to vesting Customer Heritage annuities and BPA outcomes business • Investment in customer initatives IRR NPV • Capital allocation to ne
Slide 67: Cash generation targets reflect in-force business and exclude growth
Cash generation targets reflect in-force business and exclude growth 2019 targets Targets include Growth opportunities 1 year target: • £145 billion of in-force business • C. £100 million of surplus capital Heritage to be allocated to BPA per annum £600 million– business • £750 million of vesting an
Slide 68: The wedge illustrates growth opportunities bring sustainability
The “wedge” illustrates that growth opportunities bring sustainability to cash generation Key messages M&A and BPA Phoenix used to be a pure Heritage consolidator Management Actions Cash generation We now have a growing Open business and BPA to generate incremental cash generation Open Growth brings
Slide 69: We know the shape of the Heritage wedge as run off is predictable
We know the shape of the Heritage “wedge” as run off is predictable Illustrative Heritage run off profile Expected Heritage run off profile 500 Amortisation of transitional measures 400 finishes in 2032 Cash generation (£m) 300 Cash generation 200 100 Time Heritage Assumptions Heritage business Kick
Slide 70: Three options for offsetting the Heritage run off
We have three options for offsetting the Heritage run off and delivering sustainable cash generation Option 1: Growth at 4% per Grow Open annum on 2018 actuals business would fully offset 5% per (see appendix 1) annum Heritage run off Cash generation c. £100 million capital allocation to BPA per 3 O
Slide 71: £440 million long-term cash generation from 2019 growth is incremental
£440 million long-term cash generation from 2019 growth is incremental to £12 billion guidance £90m £440m Key messages 1 £205m £350m Growth from both BPA and Open businesses 2 £440 million incremental cash generation £145m 3 Capital strain funded from surplus capital 4 Incremental cash BPA Open Tota
Slide 72: We will report progress by rolling forward long-term guidance in March
We will report our progress by rolling forward of our long-term guidance in March Long-term cash generation guidance 2019+ £12.0bn £440 million of incremental long-term cash generation New business delivered during 2019 Assumption changes Net impact of assumption changes made during FY19 Management
Slide 73: Our dividend policy remains stable and sustainable
Our dividend policy remains stable and sustainable Dividend per share(11) Key messages 2011 16.1p 16.1p 1 27% DPS uplift due to equity raising Dividend increased 4 and debt re-terming in Jan 2013 2012 16.1p 20.4p times in 7 years 2013 20.4p 20.4p 2 Increases equivalent to 2014 20.4p 20.4p 4.8% per a
Slide 74: Key messages
Key messages £707 million cash generation in 2019 exceeding target range Clear framework to allocate surplus capital Number of growth options to further enhance shareholder value and bring long-term sustainability to our cash flows Dividend policy remains stable and sustainable Year end reporting wi
Slide 75: Consolidation of the life insurance industry
M&A CONSOLIDATION OF THE LIFE INSURANCE IN-FORCE INDUSTRY BUSINESS HERITAGE OPEN GROWTH GROWTH Clive Bannister Group Chief Executive OPERATING MODEL 75
Slide 76: The accessible Heritage M&A market is growing
The accessible Heritage M&A market is growing 2016 market opportunity 2018 market opportunity 4% 5% 26% 28% Market c. £540bn growth c. £580bn 67% 70% UK Germany Ireland 76
Slide 77: The drivers of consolidation in our industry are increasing
The drivers of consolidation in our industry are increasing Drivers for keeping legacy books Reasons for selling legacy books Trapped capital Reliable cash generation Sell Legacy systems Customer base cross Keep Regulatory change selling Business model Cost inefficiencies diversification Low interes
Slide 78: The insurance industry is bifurcating
The insurance industry is bifurcating Vertically integrated Changing corporate focus in life Standard Life Assurance life insurance company insurance sector transaction illustrates this Under- writing Capital- heavy Adminis- tration Asset Investment management Management Capital- light Strategic Sal
Slide 79: Increasing barriers to entry give Phoenix a competitive advantage
Increasing barriers to entry give Phoenix a competitive advantage Optimised Regulatory M&A track Quality of business relationships record acquirer model Barriers Strong regulatory Phoenix’s strengths Scalable operating model Successful integrations Public listing relationships Financial resi
Slide 80: Clear acquisition criteria and ready to transact
We have clear acquisition criteria and are ready to transact Acquisition criteria Gating items Transition programme progressing to IRR exceeds hurdle rate of return and Management Value accretive a discount to SII Own Funds plan and on track to deliver synergy bandwidth targets Supports the Cash pro
Slide 81: Phoenix – Cash, Resilience and Growth
Phoenix – Cash, Resilience and Growth £12 billion CASH of future cash generation from in-force business (1) RESILIENCE £3.0 billion Solvency II surplus Phoenix is en-route to becoming Heritage M&A Europe’s Leading Life GROWTH BPA Open Consolidator See Appendix III for footnotes 81
Slide 82: Q&A
Q&A 82
Slide 83: Appendices
Appendices I Option 1 – Grow the Open business II Option 2 – BPA III Footnotes 83
Slide 84: Appendix I: Option - Grow the Open business
Appendix I: Option 1 - Grow the Open business Cash generation(1) £m 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Heritage run off offset by Open growth Heritage run off 400 380 361 343 326 310 294 279 265 252 239 2018 14 14 14 14 14 14 14 14 14 14 2019 15 15 15 15 15 15 15 15 15 Cash from
Slide 85: Appendix II: Option - BPA
Appendix II: Option 2 - BPA Cash generation(1) £m 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 BPA reduces Heritage run off by 3-4% Heritage run off 400 380 361 343 326 310 294 279 265 252 239 2018 10 12 14 13 13 12 11 11 10 9 2019 10 12 14 13 13 12 11 11 10 2020 10 12 14 13 13 12 11 11 BP
Slide 86: Appendix III: Footnotes
Appendix III: Footnotes (1) The Solvency II capital position is an estimated position and reflects a regulatory approved recalculation of transitionals as at 30 September 2019. The Shareholder Capital Coverage Ratio excludes Solvency II own funds and Solvency Capital Requirements of unsupported with
Slide 87: 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
Phoenix Group Holdings — Investor Day (November 2019) on 6ix