Swiss Life Holding Ag · SIX:SLHN
Swiss Life — FY2003 Earnings Presentation
92 slides from Swiss Life's earnings presentation, Mar 30, 2004
Slide 1: Results 2003 Investors' Presentation
Results 2003 Investors' Presentation Zurich, 30 March 2004
Slide 2: Swiss Life – well underway
Swiss Life – well underway • Return to profitability achieved • Operational improvements materialising • Balance sheet strengthened 2
Slide 3: Agenda
Agenda 1. Overview Rolf Dörig 2. Banca del Gottardo Rolf Dörig 3. Financial Results Bruno Pfister 4. Embedded Value Michael Koller 5. Swiss Business Paul Müller 6. Outlook Rolf Dörig 3
Slide 4: Highlights 2003
Highlights 2003 • Return to profitability achieved - Operating result: MCHF 557 - Net result: MCHF 233 - All life core markets profitable; Switzerland operating result: MCHF 76 • Operational improvements materialising - Cost and headcount reduction program completed (one year ahead of plan) - New bu
Slide 5: Financial year 2003
Financial year 2003 MCHF (IFRS basis) 2003 2002 Premiums and PH deposits (gross) 18 760 19 473 Gross written premiums 15 378 15 757 Financial result 5 836 4 713 Operating result 557 -801 Net result 233 -1 694 Earnings per share (EPS) CHF 10.8 Shareholders’ equity 4 964 4 170 Return on equity (ROE) (
Slide 6: Achievements
Achievements Priorities as announced on 8 April 2003 Achievements - Consolidate/strengthen position in core markets - Pursue divestment opportunities - Establish governance along core functions/ across core countries - Delist RAN VX and optimise legal structure - Achieve planned cost reduction targe
Slide 7: Agenda
Agenda 1. Overview Rolf Dörig 2. Banca del Gottardo Rolf Dörig 3. Financial Results Bruno Pfister 4. Embedded Value Michael Koller 5. Swiss Business Paul Müller 6. Outlook Rolf Dörig 7
Slide 8: Swiss Life to retain Banca del Gottardo
Swiss Life to retain Banca del Gottardo • Bank to be managed to further enhance value • Transfer of Banca del Gottardo (BdG) from Rentenanstalt/Swiss Life (RA/SL) to Swiss Life Holding - Transaction consideration of approx. MCHF 1 340 - Beneficial for policyholders and shareholders; balanced solutio
Slide 9: Banca del Gottardo
Banca del Gottardo • Sizeable Swiss private bank based in Lugano - Swiss and European network of branches and affiliates - Focus on private banking in offshore and onshore markets - Total AuM of CHF 39 billion; 1 200 employees • Significant improvements in profitability - 2003 statutory earnings of
Slide 10: Rationale for transferring the bank
Rationale for transferring the bank • Further step in streamlining Swiss Life Group structure - Increased transparency and strategic flexibility - Strengthen insurance business • More stable and secure investment portfolio for policyholders - Replacement of illiquid asset with liquid, diversified po
Slide 11: Accessing capital markets
Accessing capital markets • Planned group funding need - Transaction consideration of approx. MCHF 1 340 - In addition, refinancing existing debt, taking opportunity of favourable market conditions • Financing mix - Internal resources of up to MCHF 250 - Equity issue of MCHF 800 - Convertible bond o
Slide 12: Agenda
Agenda 1. Overview Rolf Dörig 2. Banca del Gottardo Rolf Dörig 3. Financial Results Bruno Pfister 4. Embedded Value Michael Koller 5. Swiss Business Paul Müller 6. Outlook Rolf Dörig 12
Slide 13: Profit and loss highlights
Profit and loss highlights MCHF (IFRS basis) 2003 2002 Change Premiums and PH deposits (gross) 18 760 19 473 -3.7% · Gross written premiums 15 378 15 757 · Policyholder deposits 3 382 3 716 Financial result 5 836 4 713 23.8% Benefits paid and changes in insurance res. -15 726 -16 329 -3.7% PH bonuse
Slide 14: Costs and headcount
Costs and headcount MCHF (IFRS basis) Cost savings accumulated(1) Headcount reduction accumulated(2) Target 515 Target 1 500 2004 2004 Actual 212 320 532 Actual 724 1 082 1 806 2002 2003 2002 2003 (1) Based on adjusted operating expenses; see appendix for details (2) In full time equivalents (FTE) 1
Slide 15: Segment results
Segment results MCHF (IFRS basis) 2003 2002 Life Core 341 -561 Life Non-Core 67 -157 Non-Life 23 -95 (1) Private Banking -19 -109 Investment Management 95 105 Other 50 16 Operating result(2) 557 -801 (1) Including loss on disposal of STG of MCHF 105 (2) Profit before goodwill amortisation, taxes and
Slide 16: Introduction of Management P&L
Introduction of Management P&L • Integrated system for performance measurement and compensation • Business view with a clear focus on operational performance, fully reconcilable with IFRS • Introduced for main insurance market units • Closely linked to Group strategy 16
Slide 17: Management P&L - insurance business
Management P&L - insurance business MCHF (IFRS basis); main insurance market units(1) 2003 2002 actual pro forma(2) KPI 1 17 807 18 374 Gross written premiums incl. PH deposits KPI 2 -1 669 -1 823 Operating expenses incl. LAEs KPI 3 201 -185 Technical result after fixed PH dividends Insurance result
Slide 18: Life Core: Premiums and policyholder deposits
Life Core: Premiums and policyholder deposits MCHF (IFRS basis) 6 643 (-19.0%) Switzerland 8 196 Belgium/Lux. 4 760 3% France (+2.3%) Netherlands 4 653 15% 1 766 (+9.0%) Germany Switzerland 1 620 Germany 41% 11% 2 356 (+68.4%) Netherlands 1 399 France 566 (+5.8%) Belgium/Lux. 30% 535 (1) 16 081 Tota
Slide 19: Segment Life Core: Operating result by country
Segment Life Core: Operating result by country MCHF (IFRS basis) 2003 2002 Switzerland 76 -566 France 123 106 Germany 40 -9 Netherlands 101 34 Belgium/Luxembourg 1 -126 Life Core(1) 341 -561 (1) Profit before goodwill amortisation, taxes and minority interests 19
Slide 20: Balance sheet highlights
Balance sheet highlights MCHF (IFRS basis) 2003 2002 Change Mathematical reserves 136 214 130 595 4.3% · Insurance reserves 103 862 100 638 · Policyholder deposits 23 678 21 219 · Separate accounts 8 674 8 738 Shareholders’ equity 4 964 4 170 19.0% · Shareholders’ equity(1) 4 367 3 807 · Revaluation
Slide 21: Shareholders' equity increased by 19%
Shareholders' equity increased by 19% MCHF (IFRS basis) 233 4 964 57 7 177 MCHF +794 320 (+19.0%) 4 170 31.12.2002 MCS II(1) Change in Change in Change in Net profit 31.12.2003 unrealised foreign share 2003 gains/losses currency premium translation and treasury differences shares (1) Mandatory conve
Slide 22: Increase in shareholders' equity through operating improvements
Increase in shareholders' equity through operating improvements MCHF (IFRS basis) 794 -384 98 697 185 2 Change in MCS II, Goodwill Impact of Impact of Operating shareholders' treasury amortisation(1) bond markets other asset improvements equity as shares and classes stated change in FX translation d
Slide 23: Allocation of unrealised gains on bonds
Allocation of unrealised gains on bonds MCHF (IFRS basis) 2 681 1 481 218 245 5 732 Unrealised Deferred Shadow Deferred Minority Allocated to gains on policyholder DAC taxes interests shareholders’ bonds dividends adjustment equity 23
Slide 24: Asset allocation insurance portfolio
Asset allocation insurance portfolio MCHF (IFRS basis) 129 306 123 944 Equities & equity funds 0.3% 6.0% 5.7% 0.3% Private equity Hedge funds 2.7% 8.4% 8.6% 2.8% Real estate 8.0% 7.9% Mortgages Loans 5.8% 8.4% Bonds 61.6% 57.9% Cash 3.7% 1.9% Other invested assets 3.5% 6.5% 2003 2002 Net equity expo
Slide 25: Investment return on insurance portfolio
Investment return on insurance portfolio MCHF (IFRS basis) Direct return of 4.4% Total return of 4.7%(1) Bonds 3 439 4.5% 3 098 4.1% Equities 387 5.2% 1 295 17.4% Private Equity 0.0% -20 -4.9% Hedge Funds 88 2.5% 146 4.1% Real Estate 671 6.3% 469 4.4% Mortgages 445 4.4% 445 4.4% Loans 319 3.5% 299 3
Slide 26: Solvency
Solvency Rentenanstalt solvency(1) EU Group solvency(2) 179% 180% 133% 138% 138% 31.12.03 2002 31.12.02 2003 31.12.03 2002 31.12.02 2003 (1) Rentenanstalt represents 84% of total mathematical reserves (2) According to methodology applied by the French regulator; including Banca del Gottardo 26
Slide 27: Agenda
Agenda 1. Overview Rolf Dörig 2. Banca del Gottardo Rolf Dörig 3. Financial Results Bruno Pfister 4. Embedded Value Michael Koller 5. Swiss Business Paul Müller 6. Outlook Rolf Dörig 27
Slide 28: Key assumptions for embedded value calculation
Key assumptions for embedded value calculation 2003 2002 • Weighted new money CH EU CH EU return based on asset allocation Risk discount rate 7.0% 7.9% 7.0% 7.9% Equity return 5.0% 6.0% 7.0% 8.0% • Weighted returns are lower due to reduced future assumed Bond return 3.0% 4.5% 2.5% 4.3% investment re
Slide 29: Embedded value for Swiss Life Holding
Embedded value for Swiss Life Holding MCHF (statutory basis) 2003 2002 RA/SL embedded value FY 2003(1) 5 832 5 616 SL Holding owns 99.72% 92.23% SL Holding share of embedded value 5 816 5 179 Free capital(2) 1 095 881 Embedded value for Swiss Life Holding 6 911 6 060 EV per share(3) CHF 276 CHF 259
Slide 30: Embedded value breakdown
Embedded value breakdown MCHF (statutory basis); RA/SL Switzerland Europe Total -3.6% +15.5% +3.8% 5 832 5 616 Increase result of 4 509 4 345 • Reduced expenses 4 784 5 185 • Positive value of new 2 796 2 421 business 2 180 • Re-pricing of products 1 740 -1 309 -1 132 • Investment performance -1 314
Slide 31: ANAV improved substantially
ANAV improved substantially MCHF (statutory basis); RA/SL 2003 2002 Change Statutory equity of RA/SL(1) 1 919 1 327 44.6% Unrealised capital gains after tax 1 123 1 019 10.2% Statutory book value of life subsidiaries -834 -854 2.3% Net asset value of other units 587 248 136.7% Adjusted net asset val
Slide 32: Embedded value: Analysis of change
Embedded value: Analysis of change MCHF (statutory basis); RA/SL RA/SL EV 2002 5 616 Unwind 2003 +414 Actual investment return 2003 +580 Future investment return -1 033 Cost savings +602 Reserves strengthening -312 New pricing +473 Reduction in BVG crediting rate +342 Legal quote group life CH -944
Slide 33: Increased value of new business
Increased value of new business MCHF (statutory basis) Switzerland(1) France(2) Germany Netherlands Belgium(3) Sum 52 35 24 18 17 12 11 13 6 2 1 -17 2003 2002 2003 2002 2003 2002 2003 2002 2003 2002 2003 2002 APE(4) 186 344 111 128 220 144 286 103 47 26 850 745 (1) Including La Suisse Vie (2) Withou
Slide 34: Sensitivities of embedded value
Sensitivities of embedded value MCHF (statutory basis); RA/SL Switzerland Europe Total RA/SL EV FY 2003 (base case) 4 345(1) 2 796 5 832(2) D Risk discount rate -50 bps +204 +107 +311 D Investment returns +50 bps +316 +304 +620 D Investment returns -50 bps -647 -332 -979 D Equity values -10% -18 -36
Slide 35: Average technical interest rate of 3.20%
Average technical interest rate of 3.20% In million CHF / EUR / USD / GBP (statutory basis) Technical interest rate CHF EUR USD GBP 0% - < 2% 1 719 935 2 155 2% - < 3%(1) 23 161 1 175 0 0 3% - < 4% 34 427 13 609 2 83 4% - < 5% 2 301 15 135 444 627 5% - < 6% 138 362 25 0 6% - < 7.5% 0 69 10 0 Total r
Slide 36: Agenda
Agenda 1. Overview Rolf Dörig 2. Banca del Gottardo Rolf Dörig 3. Financial Results Bruno Pfister 4. Embedded Value Michael Koller 5. Swiss Business Paul Müller 6. Outlook Rolf Dörig 36
Slide 37: Premiums overview
Premiums overview MCHF (statutory basis); RA/SL ZH 2003 2002 Change Individual life · Single premiums 643 1 377 -53.3% · Periodic premiums 1 020 1 049 -2.8% Subtotal 1 663 2 426 -31.5% Group life · Single premiums 2 452 3 296 -25.6% · Periodic premiums 2 462 2 401 2.5% Subtotal 4 914 5 697 -13.8% To
Slide 38: Portfolio structure
Portfolio structure (statutory basis) 2003 2002 Individual 25% 47% Single Individual 30% 58% Single life premium life premium 75% 53% 70% 42% Group Periodic Group Periodic life premium life premium 38
Slide 39: Costs and headcount reduced
Costs and headcount reduced MCHF (IFRS basis); RA/SL ZH 2003 2002 Change Staff costs 376 417 -10% Other costs 319 456 -30% Total operating costs 695 873 -20% DAC and commissions -91 -134 -32% Other adjustments (incl. restructuring costs) -8 -78 -85% Total adjusted operating costs 596 661 -10% FTE 2
Slide 40: Analysis of surplus
Analysis of surplus MCHF (statutory basis); RA/SL ZH Individual Group Total Risk result 39.6 65.4 105.0 Net interest income 122.9 -42.5 80.4 Cost result -52.8 -26.6 -79.4 Technical result 109.7 -3.7 106.0 Investment result 240.8 418.5 659.3 Reserves strengthening -280.5 -184.8 -465.3 Policyholder bo
Slide 41: Regulatory framework in group life
Regulatory framework in group life • Revised BVG law to be fully introduced on 1 January 2005 - Legal quote for group life (effective as of 1 April 2004) - Asset split as additional requirement to increase transparency - Slow reduction of mandatory conversion rate to 6.8% (until 2014) - Surrender pe
Slide 42: Swiss Life's offer in group life in 2005
Swiss Life's offer in group life in 2005 • Customer-oriented BVG solution - Fair offer for existing Swiss Life customers - First in the market to provide clear mid-term perspective • Attractive offer based on full-value insurance (“Vollversicherung”) - Reduction of non-mandatory conversion rate to 5
Slide 43: Conversion rate group life starting in 2005
Conversion rate group life starting in 2005 Existing portfolio Conversion rate in mandatory part down to 7.2% 6.8% in 2014 6.8% 6.4% 6.1% 5.835% Conversion rate in non-mandatory part 2004 2005 2006 2007 2008 2009 2010 Men 1940 1941 1942 1943 Year of birth affected Women 1942 1943 1944 43
Slide 44: Outlook Swiss business
Outlook Swiss business • Swiss Life continues to assume all pension risks on behalf of its customers - Full-value insurance ("Vollversicherung") - Phased reduction of non-mandatory conversion rate - Same conversion rate for men and women - Portfolio of pensioners to stay with Swiss Life • Focus on p
Slide 45: Agenda
Agenda 1. Overview Rolf Dörig 2. Banca del Gottardo Rolf Dörig 3. Financial Results Bruno Pfister 4. Embedded Value Michael Koller 5. Swiss Business Paul Müller 6. Outlook Rolf Dörig 45
Slide 46: Swiss Life – well underway
Swiss Life – well underway • Return to profitability achieved • Operational improvements materialising • Balance sheet strengthened 46
Slide 47: Drivers for profitable growth
Drivers for profitable growth • Swiss Life has an attractive position in its European core markets as a focused, well-regarded provider of life and pension products ð Fifth largest provider in core markets(1) • Increased pressure on state pension systems and changing tax legislation offers new chanc
Slide 48: Outlook 2004
Outlook 2004 • Transfer Banca del Gottardo to Swiss Life Holding level • Return to profitable premium growth; 1% above market growth rate(1) • Increase profitability substantially • Resume dividend payments (1) CAGR 2004-2006E 48
Slide 49: Supplementary information
fiz SwissLife Supplementary information
Slide 50: Supplementary information
Supplementary information 1. Profit and Loss 2. Balance Sheet 3. Embedded Value 4. Contact details 50
Slide 51: Foreign currency exchange rates and interest rates
Foreign currency exchange rates and interest rates Foreign currency exchange rates 31.12.03 30.06.03 31.12.02 1.1.-31.12.03 1.1.-30.06.03 1.1.-31.12.02 EUR 1.56 1.55 1.46 1.52 1.49 1.47 GBP 2.20 2.24 2.23 2.20 2.18 2.33 USD 1.24 1.36 1.39 1.35 1.35 1.56 Interest rates 31.12.03 30.06.03 31.12.02 (1)
Slide 52: Four KPIs are derived from Management P&L
Four KPIs are derived from Management P&L Market unit level, derived from group level KPI on market unit Value Interpretation Definition level Drivers KPI 1 Premium income as it is traditionally Does the market unit grow and Gross written Growth defined, including all savings build up business? prem
Slide 53: Profit transition Management P&L
Profit transition Management P&L MCHF (IFRS basis) 2003 IFRS profit contribution Management P&L 163 Elimination effects within Management P&L scope(1) -25 IFRS profit other insurance units +36 IFRS profit Investment Management & Private Banking(2) +35 IFRS profit Holding & other units +24 Total Grou
Slide 54: Life core: Overview of key financials
Life core: Overview of key financials MCHF (IFRS basis) 2003 2002 Change Premiums and policy fees(1) 12 532 12 661 -1.0% Financial result 5 038 3 913 28.8% Other income -50 107 Total revenues 17 520 16 681 5.0% Interest credited to clients & borrowings -941 -1 070 -12.1% Provisions for ins. reserves
Slide 55: Life Core: Premiums and policyholder deposits
Life Core: Premiums and policyholder deposits MCHF (IFRS basis) 2003: 16 081 2002: 16 394 Growth in life core premiums by line of business 22% 50% 24% 45% Group +7.7% Individual -10.1% Policyholder deposits, -9.4% assumed premiums 28% 31% 4% 5% 20% 43% 21% 39% Periodic +6.5% Single -6.8% Policyholde
Slide 56: Life Core: Technical reserves by core countries
Life Core: Technical reserves by core countries MCHF (IFRS basis) 55 409 (-2.0%) Switzerland 56 530 6 435 (+13.7%) Belgium/Lux. France 5 660 Netherlands 2% 14% 16 709 (+13.1%) Germany 14 768 Switzerland Germany 59% 13 043 (+23.0%) 18% Netherlands 10 602 1 945 (+13.4%) Belgium/Lux. 1 715 France 7% -8
Slide 57: Opportunities for profitable growth in core markets (1/2)
Opportunities for profitable growth in core markets (1/2) Switzerland • Changing competitive landscape (withdrawal of competitors) in a market defined by high volumes and considerable scope for earnings improvements • Continue to provide full-value insurance following strict profit guidelines France
Slide 58: Opportunities for profitable growth in core markets (2/2)
Opportunities for profitable growth in core markets (2/2) Netherlands • Independent pension funds are driven towards life insurers for pension security reasons • Leverage strong brand with pension image to continue to outgrow the market Belgium • Pension reform with high impact on business growth fo
Slide 59: Life Non-Core: Overview of key financials
Life Non-Core: Overview of key financials MCHF (IFRS basis) 2003 2002 Change Premiums and policy fees(1) 1 322 1 592 -17.0% Financial result 450 315 42.9% Other income 18 17 5.9% Total revenues 1 790 1 924 -7.0% Interest credited to clients & borrowings -40 -39 2.6% Provisions for ins. reserves + be
Slide 60: Life Non-Core: Premiums and policyholder deposits
Life Non-Core: Premiums and policyholder deposits MCHF (IFRS basis) 2003: 1 646 2002: 2 045 Growth in life core 7% premiums by line of business 13% 67% 66% 26% Group -18.5% Individual +3.4% Policyholder deposits, -60.9% 21% assumed premiums 6% 1% 1% 13% 53% Periodic -3.6% Single -28.8% Policyholder
Slide 61: Non-Life: Overview of key financials
Non-Life: Overview of key financials MCHF (IFRS basis) 2003 2002 Change Premiums 962 1 004 -4.2% Provisions for ins. reserves + benefits paid -726 -868 -16.4% PH dividends and participation in profit -18 25 Operating expenses -316 -351 -10.0% Total insurance expenses -1 060 -1 194 -11.2% Technical r
Slide 62: Banca del Gottardo: Overview of key financials
Banca del Gottardo: Overview of key financials MCHF (statutory basis) 2003 2002 Change Results from interest activities 148 155 -4.6% Results from commission and service act. 232 250 -7.2% Results from trading operations 79 52 51.6% Other 8 -9 Net revenues 467 448 4.2% Personnel expenses -189 -210 -
Slide 63: Banca del Gottardo: Key ratios
Banca del Gottardo: Key ratios MCHF (statutory basis) 2003 2002 Change Return on equity 9.8% Cost/income ratio 62.7% 74.9% BIS ratio (Tier 1) 12.6% 10.0% 260 bps BIS ratio (Tier 2) 13.7% 11.3% 240 bps Assets under management 38 531 36 788 4.7% 63
Slide 64: Financial result
Financial result MCHF (IFRS basis) 2003 2002 Change Investment income, net 5 552 5 505 0.9% Realised and unrealised gains/losses(1) 334 -2 304 Trading income, net(2) -50 1 512 Financial result 5 836 4 713 23.8% (1) Includes foreign currency gains and losses on investments recorded in the income stat
Slide 65: Investment Management: Overview of key financials
Investment Management: Overview of key financials MCHF (IFRS basis) 2003 2002 Change Investment management, other income 196 229 -14.4% Financial result 42 50 -16.0% Total revenues 238 279 -14.7% Total expenses -143 -174 -17.8% Operating result(1) 95 105 -9.5% (1) Profit before amortization of goodw
Slide 66: Adjusted operating expenses
Adjusted operating expenses MCHF (IFRS basis) 2003 2002 Change Operating expenses 2 880 3 436 -16.2% Commissions and DAC amortisation -703 -744 -5.5% Loss adjustment expenses 161 181 -11.1% Currency effects 33 Restructuring cost -58 -144 -59.7% Change in reserves for employee benefits 36 -68 Cost ba
Slide 67: Details on costs and headcount reduction
Details on costs and headcount reduction MCHF (IFRS basis) Incremental savings 2003 Incremental headcount reduction(1) Actual 320 Actual 1 082 Switzerland 65 Switzerland 371 La Suisse 15 La Suisse 27 France 7 France 61 Germany 26 Germany 32 Belgium/Lux. 31 Belgium/Lux. 125 Netherlands 0 Netherlands
Slide 68: Legal quote mechanism: shareholder view
Legal quote mechanism: shareholder view(1) • Net principle: legal quote based on profit • Gross principle: legal quote applied to income only Net principle Yes • Return on solvency capital • +10% of remaining gain No Gross principle • 10% of investment return • +10% of risk premium • +10% of expense
Slide 69: Legal quote mechanism: policyholder view
Legal quote mechanism: policyholder view • Remaining part of return (ie 90%) not attributable to shareholders for - Reserve strengthening - Bonus reserves, including bonuses • Bonus reserves can be used for losses. They need to be consumed within 5 years 69
Slide 70: Supplementary information
Supplementary information 1. Profit and Loss 2. Balance Sheet 3. Embedded Value 4. Contact details 70
Slide 71: Assets under management
Assets under management MCHF (IFRS basis) 2003 2002 Change Total on-B/S-assets(1) 149 476 146 171 2.3% minus · Assets of unit-linked business -3 250 - 4 006 -18.9% · Externally managed alternative -6 312 -5 790 9.0% investments and other assets Total on-B/S-assets managed in-house 139 914 136 375 2.
Slide 72: Bond portfolio: ratings
Bond portfolio: ratings Insurance portfolio (IFRS basis) Investments: MCHF 79 500 Breakdown by rating BBB Not rated A 2% 1% 10% Government 27% AA 17% Sovereign 12% AAA 31% 72
Slide 73: Bond portfolio: currency exposure
Bond portfolio: currency exposure Insurance portfolio (IFRS basis) Investments: MCHF 79 500 Before hedges After hedges GBP USD Other 3% 2% 2% CHF EUR CHF EUR 32% 63% 41% 57% 73
Slide 74: Bond portfolio: duration
Bond portfolio: duration Group, not consolidated Market value Effective duration CHF 32.8% 7.8 EUR 61.6% 6.2 GBP 3.2% 13.9 USD 2.3% 7.7 Other 0.1% 2.3 Average 100% 7.0 74
Slide 75: Equity portfolio: currency exposure
Equity portfolio: currency exposure Insurance portfolio (IFRS basis) Investments: MCHF 7 780 Before hedges GBP JPY USD 2% 2% 7% CHF 17% EUR 72% 75
Slide 76: Loan and mortgages portfolio
Loan and mortgages portfolio (IFRS basis) Investments: MCHF 19 920 Breakdown by type Policyholder loans 7% Money markets 10% Mortgages 52% Other loans 31% 76
Slide 77: Real estate portfolio
Real estate portfolio Insurance portfolio excl. La Suisse (IFRS basis) Investments: MCHF 9 850 Breakdown by country Breakdown by type Belgium 2% Other Germany Centers 1% 5% 11% France Residential 7% 49% Mixed 18% Switzerland Commercial 85% 22% 77
Slide 78: Hedge funds portfolio
Hedge funds portfolio Group, not consolidated Investments: MCHF 3 550 Breakdown by style Fund of funds Various 4% 3% Equity hedged Managed futures 19% 8% Global macro 14% Leveraged finance manager 19% Event driven 15% Relative value 18% 78
Slide 79: Private equity portfolio
Private equity portfolio Group, not consolidated Investments: MCHF 400 Direct investments Fund of funds 7% 8% Buyout Balanced 41% 15% Venture 29% Open commitments: MCHF 452 79
Slide 80: Currency exposure
Currency exposure Group, not consolidated Net: 0.85% of total insurance portfolio assets Other USD 81 million 60 million 7% 5% JPY 91 million 8% GBP EUR 125 million 746 million 11% 68% Net currency exposure MCHF 1 103 Hedged MCHF 12 927 Gross exposure MCHF 14 030 80
Slide 81: Currency hedging ratios
Currency hedging ratios Group, not consolidated 7% 6% Net currency 20% exposure 100% 100% 93% 94% 80% Currency hedged No curr. No curr. risk risk Equities & Private Hedge Loans Real estate Bonds Other equity funds equity funds invested assets 81
Slide 82: Goodwill development
Goodwill development MCHF (IFRS basis) 2 427 -823 -102 -149 1 353 -42 -208 -59 1 044 Goodwill BdG STG Other Goodwill BdG STG Other Goodwill 31.12.01 31.12.02 31.12.03 Goodwill in % of: SH equity: 48.7% 32.4% 21.0% Core capital: 31.3% 17.9% 11.8% 82
Slide 83: Statutory solvency remains strong at 179%
Statutory solvency remains strong at 179% MCHF (statutory basis) Solvency capital(1) Statutory solvency(1) Rentenanstalt stat.equity capital 1 919 Intangibles -81 7 267 179% Hybrid capital 1 305 Additional Zillmerisation +424 4 056 Unrealised capital gains +3 128 Unattributed surplus +572 Solvency c
Slide 84: Supplementary information
Supplementary information 1. Profit and Loss 2. Balance Sheet 3. Embedded Value 4. Contact details 84
Slide 85: Implementation of embedded value at Swiss Life
Implementation of embedded value at Swiss Life Swiss Life • ANAV and PVFP have been calculated UK for more than 95% of the mathematical Swiss Life B reserves Swiss Life NL • For other life insurance entities only Swiss Life D the NAV has been included Swiss Life CH • The banking and non-life insuran
Slide 86: Asset allocation by region
Asset allocation by region Assumptions 2003 2002 CH EU CH EU Cash and cash equivalents 1% 4% 1% 3% Bonds and loans 61% 74% 61% 75% Mortages 10% 11% 10% 5% Real estate 14% 4% 14% 3% Equities 3% 3% 3% 8% Participations 4% 3% 4% 6% Alternative investments 7% 1% 7% 0% 86
Slide 87: Analysis of change
Analysis of change MCHF (statutory basis); RA/SL RA/SL EV 2002 5 616 100% Unwind 2003 414 +7% Investment returns -453 -8% · Actual 2003 580 · Future investment returns -1 033 Cost savings +602 +11% Strengthening of reserves -312 -5% Jan-Dec 03: +216 (4%) New pricing +473 +9% Reduction in BVG crediti
Slide 88: Analysis of change
Analysis of change MCHF (statutory basis); Swiss Life Holding SLH EV 2002 6 060 Unwind 2003 +413 Actual investment return 2003 +578 Future investment return -1 030 Cost savings +600 Strengthening of reserves -311 New pricing +472 Reduction in BVG crediting rate +341 Legal quote Switzerland -941 Valu
Slide 89: Cautionary statement regarding forward-looking information
Cautionary statement regarding forward-looking information This presentation is made by Swiss Life and may not be copied, altered, offered, sold or otherwise distributed to any other person by any recipient without the consent of Swiss Life. Although all reasonable effort has been made to ensure the
Slide 90: Supplementary information
Supplementary information 1. Profit and Loss 2. Balance Sheet 3. Embedded Value 4. Contact details 90
Slide 91: Contact the Investor Relations Team
Contact the Investor Relations Team Peter Huber Tel. +41 (43) 284 41 99 Head Investor Relations E-mail: peter.huber@swisslife.ch Karin Schack Tel. +41 (43) 284 49 19 Manager Investor Relations E-mail: karin.schack@swisslife.ch Visit our website for up-to-date information www.swisslife.com 91
Slide 92: SwissLife
te SwissLife Prepared for the future.