Prudential Plc · LSE:PRU

Prudential — Investor Day (December 2015)

91 slides from Prudential's investor day presentation, December 2015

  1. Slide 1: Opportunity, Delivery, Ambition

    Opportunity, Delivery, Ambition Tony Wilkey - Chief Executive Prudential Corporation Asia

  2. Slide 2: Forward Looking Statements

    Forward Looking Statements This document may contain ‘forward-looking statements’ with respect to certain of Prudential's plans and its goals and expectations relating to its future financial condition, performance, results, strategy and objectives. Statements that are not historical facts, includin

  3. Slide 3: Compelling structural growth, but complex environment

    Compelling structural growth, but complex environment GDP Growth in PCA’s Markets (ex Japan) Growing Middle Class Context  Natural disasters $24.1 trillion 1.9bn  Geopolitical tensions $17.1 trillion 1.2bn  Different regulatory perspectives  Domestic politics 2014 2020 2010 2020  Infrastructure

  4. Slide 4: Clear needs, but significantly underserved by industry

    Clear needs, but significantly underserved by industry More Mortality Cover More Health Cover Better use of Savings 11% 19% Mortality Health 28% Protection Protection Gap Gap 50% Income to Total future maintain living Life Insurance healthcare Projected standards costs expenditure to 61% cover futur

  5. Slide 5: Well diversified market participation

    Well diversified market participation  Flexible Life Market approach matching our strengths to market opportunities: – Profitable niches in Korea and Taiwan – Lead foreign joint ventures in India and China – Excel in city states, Hong Kong and Singapore – Transform Malaysia with Bumi strategy – Pio

  6. Slide 6: Unrivalled distribution reach

    Unrivalled distribution reach LIFE INSURANCE ASSET MANAGEMENT GLOBAL PLATFORMS BANKS Over LOCAL BANKS RETAIL CUSTOMERS SALES FORCE 500,000 Direct PRIVATE BANKS SECURITIES COMPANIES agents Access to 500m people PCA’s LIFE CUSTOMERS Active in 10,000 INSTITUTIONS bank Selective DM/TM & GATEKEEPERS INHO

  7. Slide 7: Products tailored to meet different market needs

    Products tailored to meet different market needs Life Examples Funds Examples Hong Kong: PAR Indonesia: Linked Singapore: Shield Market Asset Class FUM Flagship Funds Asian Equity Income Equity £5.8bn Japan Equity Japan Fixed £0.7bn US High Yield + Indonesia Bond Income Korea Equity + China A Share

  8. Slide 8: Multidimensional delivery

    Multidimensional delivery Investment Performance People  Asian Investor ‘Asia Fund House of the Year’  Staff retention rate 87%  Average 62% of funds outperforming  93% of staff believe strongly in PCA’s goals benchmarks/peers  Healthy mix of 60:40 internal to external candidate  Multiple awar

  9. Slide 9: Evolution not revolution

    Evolution not revolution • Opportunity • Delivery • Ambition 8

  10. Slide 10: Delivering Resilient Earnings

    Delivering Resilient Earnings Adrian O’Connor - Chief Financial Officer Prudential Corporation Asia

  11. Slide 11: Forward Looking Statements

    Forward Looking Statements This document may contain ‘forward-looking statements’ with respect to certain of Prudential's plans and its goals and expectations relating to its future financial condition, performance, results, strategy and objectives. Statements that are not historical facts, includin

  12. Slide 12: Agenda

    Agenda  Scale, strength and quality  IFRS operating profit – PCA  IFRS operating profit – Eastspring Investments  IFRS operating profit – Life – Indonesia example – Hong Kong example  Summary 2

  13. Slide 13: Scale of Business

    Scale of Business A reflection of Asia growth story… Life Value of In-force Business, £bn Life Reserves, £bn 10.0 45 48 9.6 4.4 22 1.0 8 2004 2009 2014 HY 2015 2004 2009 2014 HY 2015 Life Weighted Premium Income, £bn Eastspring Funds Under Management, £bn 77 85 8.4 42 4.3 4.8 1.8 21 2004 2009 2014 H

  14. Slide 14: Strength and Quality of Life Franchise

    Strength and Quality of Life Franchise Growth in new business value creation tracking to sales growth Annualised Premium Equivalent (£m, CER) New Business Profit (£m, CER) 2,237 1,946 1,707 1,366 1,162 1,042 1,032 858 664 512 2012 2013 2014 HY2014 HY2015 2012 2013 2014 HY2014 HY2015 4

  15. Slide 15: Eastspring Investments

    Eastspring Investments Asia life FUM dominates, but gaining momentum in organic growth with third party flows Evolution of Funds Under Management (£bn, CER) Third Party Net Flows1 (£m, CER) 90 12 85 80 12 6,000 13 70 5 > 30% CAGR 36 14 8 5,000 60 MMF  > 30% CAGR 13 4,000 50 46 10 40 > 90% CAGR 3,00

  16. Slide 16: Agenda

    Agenda  Scale, strength and quality  IFRS operating profit – PCA  IFRS operating profit – Eastspring Investments  IFRS operating profit – Life – Indonesia example – Hong Kong example  Summary 6

  17. Slide 17: Growing Profit

    Growing Profit Execution capabilities translating to growing profits delivery IFRS Operating Profit (£m, CER) 1,140 90 973 68 816 63 632 540 58 1,050 43 905 7531 574 497 2012 2013 2014 HY2014 HY2015 Life Eastspring 2012 comparative excludes the one-off gain on sale of Prudential Group’s stake in Chi

  18. Slide 18: Maintaining Profit Resilience

    Maintaining Profit Resilience Robust profit delivery underpinned by insurance margin and fee income Sources of IFRS Operating Profit (£m, CER) 1,304 1,161 997 10% 9% 8% 742 Shareholders’ Return 52% 625 9% With Profits 53% 53% 10% Spread Income Revenue 82% 82% 85% 52% Insurance Margin 12% 52% 12% 84%

  19. Slide 19: Agenda

    Agenda  Scale, strength and quality  IFRS operating profit – PCA  IFRS operating profit – Eastspring Investments  IFRS operating profit – Life – Indonesia example – Hong Kong example  Summary 9

  20. Slide 20: Eastspring – Funds Under Management

    Eastspring – Funds Under Management Benefiting from influx of regular flows and thus stability of growing Asia life FUM Average Funds Under Management (£bn, CER) Asia life Average FUM CAGR: 18% Asia life Average FUM CAGR: 14% Total Average FUM CAGR: 7% Total Average FUM CAGR: 15% 77 67 57 47 50 44 3

  21. Slide 21: Eastspring – Revenue Growth and Operating Leverage

    Eastspring – Revenue Growth and Operating Leverage Revenue from non Asia life FUM more than offset total expenses Eastspring Revenue vs. Expenses Revenue CAGR: 4% Revenue CAGR: 15% 300 Expense CAGR: 2% Expense CAGR: 13% 278 (300) Revenue Expenses 241 (£m, CER) (£m, CER) 82 205 188 185 74 200 180 (20

  22. Slide 22: Agenda

    Agenda  Scale, strength and quality  IFRS operating profit – PCA  IFRS operating profit – Eastspring Investments  IFRS operating profit – Life – Indonesia example – Hong Kong example  Summary 12

  23. Slide 23: Life – Key Sources of IFRS Earnings

    Life – Key Sources of IFRS Earnings Diversity adding to profits resilience with increasing contribution from ‘Others’ Insurance Margin (£m, CER) Fee Income (£m, CER) 800 Overall CAGR: 13% Overall growth: 20% Overall CAGR: 11% Overall growth: 13% Others’ CAGR: 27% Others’ growth: 36% Others’ CAGR: 16

  24. Slide 24: Agenda

    Agenda  Scale, strength and quality  IFRS operating profit – PCA  IFRS operating profit – Eastspring Investments  IFRS operating profit – Life – Indonesia example – Hong Kong example  Summary 14

  25. Slide 25: Indonesia life

    Indonesia life Growth in sales of unit-linked products with H&P riders driving earnings growth Annualised Premium Equivalent (£m, CER) IFRS Operating Profit (£m, CER) 450 450 385 339 309 55% 55% 203 197 183 182 167 138 58% 112 57% 53% 86% 45% 89% 45% 89% 86% 42% 43% 47% 86% 0 0 2010 2012 2014 HY 201

  26. Slide 26: Indonesia life

    Indonesia life Relatively ‘flat-back’ signature of new business profits underpinning earnings growth New business IFRS profit profile1 (% of APE) IFRS profit sensitivity to new business growth2, £m Recurring premium unit-linked products with H&P riders ILLUSTRATIVE 1,000 30% 500 0% 0 1-3 4-6 7-9 10-

  27. Slide 27: Agenda

    Agenda  Scale, strength and quality  IFRS operating profit – PCA  IFRS operating profit – Eastspring Investments  IFRS operating profit – Life – Indonesia example – Hong Kong example  Summary 17

  28. Slide 28: Hong Kong life

    Hong Kong life Earnings growth bolstered by growth in sales of shareholder-backed products Annualised Premium Equivalent (£m, CER) IFRS Operating Profit (£m, CER) 700 Overall CAGR: 24% Overall growth: 84% Overall CAGR: 22% Overall growth: 23% S/H-backed CAGR: 13% 645 S/H-backed growth: 63% S/H-backe

  29. Slide 29: Hong Kong life – Shareholder-backed book

    Hong Kong life – Shareholder-backed book Growth in sales boosting earnings given the ‘right-skewed’ signature of shareholder-backed profits New business IFRS profit profile1 (% of APE) IFRS profit sensitivity to new business growth2, £m Shareholder-backed products Shareholder-backed business ILLUSTR

  30. Slide 30: Hong Kong life – Participating book

    Hong Kong life – Participating book Slow burn with potential to become material New business IFRS profit profile1 (% of APE) IFRS profit sensitivity to new business growth2, £m Participating products Participating business ILLUSTRATIVE 30% 100 0% 0 1-3 4-6 7-9 10-12 13-15 16-18 19-21 22-24 25-27 28-

  31. Slide 31: Agenda

    Agenda  Scale, strength and quality  IFRS operating profit – PCA  IFRS operating profit – Eastspring Investments  IFRS operating profit – Life – Indonesia example – Hong Kong example  Summary 21

  32. Slide 32: Resilient IFRS Profits

    Resilient IFRS Profits IFRS operating profit sensitivities to new business growth1,2 Illustrative • IFRS operating profit underpinned by inforce premiums • New business is additive over time • IFRS operating profit expected to grow across a range of hypothetical scenarios Year 0 Year 1 Year 2 Year 3

  33. Slide 33: Asia 2017 Objectives

    Asia 2017 Objectives On track on constant currency IFRS Operating Profit, £m Underlying Free Surplus, £m At least 15% CAGR from 2012–17 Free surplus of £0.9bn to £1.1bn 18% 13% 18% 11% - 18% CAGR CAGR CAGR CAGR £1.1bn (18% CAGR) £0.9bn (13% CAGR) 1,260 1,075 662 901 573 HY 471 HY 2012 2013 2014 2015

  34. Slide 34: Key Messages

    Key Messages  An enduring portfolio built with discipline, that is still growing  Insurance Margin and Fee Income continue to be our staple source of earnings  Diversity provides further dimension to earnings resilience  Synergy with Eastspring and operating leverage adding to earnings  Overall

  35. Slide 35: Consistent, Resilient Delivery

    Consistent, Resilient Delivery Lilian Ng - Chief Executive, Insurance Azim Mithani - Chief Operating Officer, Insurance Prudential Corporation Asia

  36. Slide 36: Forward Looking Statements

    Forward Looking Statements This document may contain ‘forward-looking statements’ with respect to certain of Prudential's plans and its goals and expectations relating to its future financial condition, performance, results, strategy and objectives. Statements that are not historical facts, includin

  37. Slide 37: PCA Insurance today

    PCA Insurance today Well positioned to thrive and adapt … Delivery …. Platform …. Agility …. Prudential: Business Agility Leading in Asia Business Sense Respond Adapt Agility 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014  Consistent, resilient results  Scale and Diversity  Continuous intellig

  38. Slide 38: Consistent, resilient delivery

    Consistent, resilient delivery 24 consecutive quarters of growth averaging 17% Year 2009 Year 2014 1.2bn £m APE 7% p.a. 13% p.a. 2.2bn £ APE Market NB 2009-14 PCA APE 2009-14 0.5bn £m NBP 2 1.2bn £ NBP 2 New Business Annualised Cumulative Growth % / Q1 2013 as base 220 Prudential Asia APE 200 180 US

  39. Slide 39: Market out-performance in chosen sectors

    Market out-performance in chosen sectors Proven track record across multi-dimensional metrics APE APE Growth Profit (IFRS / US GAAP basis) Growth indexed Growth indexed to 100 to 100 PRU’s APE share: 40% of peers 160 160 150 150 140 140 130 120 130 110 120 100 110 90 80 100 70 Co B Co C Co D Co B Co

  40. Slide 40: Advantaged platform for sustainable growth

    Advantaged platform for sustainable growth “All seasons” Product Market Leading Seamless and Unparalleled Delivery Solution Robust Technological Agency Efficient in Bancassurance with Economic Platform Management Customer Experience Discipline Growing Markets: APE grew 20% p.a.2 >25% APE and NBP Loy

  41. Slide 41: Making lasting impressions with a trusted brand

    Making lasting impressions with a trusted brand ALWAYS LISTENING. ALWAYS UNDERSTANDING  Trustworthy company  Financially strong  Understands and cares about its customers Bringing the LISTENING brand to life by UNDERSTANDING customers’ needs and becoming part of their lives Source: Prudential Bra

  42. Slide 42: Mega trends (re) shaping life insurance

    Mega trends (re) shaping life insurance Don’t leave it all to technology Humans are better than Computers in recognizing Advanced Technology patterns Analytic technique Big data / data traffic Talent Attraction & Retention Software and application Talent shortage Adaptability to uncertainty Employee

  43. Slide 43: Strategic priorities for delivery

    Strategic priorities for delivery Strategic Pillars Core focus areas Operating Platform Right Footprint; exploring “relevant” new markets Geography Evolving operational strategy for capacity and efficiency with transformed processes, technology and measurements Lead, defend and grow distribution bre

  44. Slide 44: Leverage scale and diversity for growth

    Leverage scale and diversity for growth Our capacity and scale creating competitive advantage Strategic levers for growth 35% Material Business Reinforce and evolve material ‒ Steady source of profits Hong Kong #2 business units ‒ Consistent new business growth (18%,28%) Prudential Asia Share of APE

  45. Slide 45: Indonesia: Long term fundamentals intact

    Indonesia: Long term fundamentals intact Drivers of Demand Insurance market Overview  Growing universe of middle / affluent class (30% of the population)  Short term challenges affecting growth  Diversified footprint critical to reach and service across the islands  Attractive demography with a

  46. Slide 46: PRU Indonesia: Evolving for growth

    PRU Indonesia: Evolving for growth Taking stock of opportunistic challenges Evolving for growth  PRU Customer per population less than 1%  Reinforce the foundation and differentiated model to accelerate agency  PRU Customer per agent holding static at 11  Introducing solutions based on life stag

  47. Slide 47: Singapore: Headroom for selected profitable growth

    Singapore: Headroom for selected profitable growth Drivers of Demand Insurance Market Overview  40% of wealth in cash and deposits. $350bn cash in banks  Single digit growth in the market  Demand for diversified investment accumulation  Market growth driven by partnerships distribution  Signifi

  48. Slide 48: PRU Singapore: Leveraging core strengths for growth

    PRU Singapore: Leveraging core strengths for growth Taking stock of opportunistic challenges Leveraging core strengths for growth  Slow population growth; domestic demand driven  Focus on “value over volume”  Face to face advice preferred. Intense competition in bancassurance  Reinforce agency l

  49. Slide 49: Scaling up high performing businesses

    Scaling up high performing businesses Thailand Vietnam Philippines  Bancassurance growing fast  Economy grows at fastest space  Insurance market is underserved  Untapped health opportunity  Increasing income drives savings & health demand  Liberalised market amongst ASEAN peers Continued outpe

  50. Slide 50: China: Underpenetrated market with strong demography

    China: Underpenetrated market with strong demography Drivers of Demand Insurance market Overview  Large market with low penetration  Highly concentrated; top 5 players occupy 50% of market  Underdeveloped with large protection gap  State Council "Guo Shi Tiao" (July 2015) aspires to increase ins

  51. Slide 51: PRU China: Seizing the growth opportunity

    PRU China: Seizing the growth opportunity Building sustainable scale  64 cities among 12 provinces, 3 municipalities and 1 autonomous region Extensive geographic reach in the “right” place  Distribution o Agency focus on recruitment, activation and performance management with general agency for ex

  52. Slide 52: Strategic priorities for delivery

    Strategic priorities for delivery Strategic Pillars Core focus areas Operating Platform Right Footprint; exploring “relevant” new markets Geography Evolving operational strategy for capacity and efficiency with transformed processes, technology and measurements Lead, defend and grow distribution bre

  53. Slide 53: Distribution: Lead, Defend, Grow

    Distribution: Lead, Defend, Grow Sustaining high calibre distribution eco-system in our target markets Accessible Engaging Over 500,000 agents and 10,000 bank branches Supporting distribution through training, tools, analytics, process, technology, & skills upgrade Extensive reach through strategic

  54. Slide 54: Distribution: Delivering throughput and productivity

    Distribution: Delivering throughput and productivity Unified platform Market leading results Connected & Engaged POS Web Social Activity Management 225 % Growth in electronic submission over 20101 Digitised and Simplified >35 % Sales Electronic Electronic Electronic submission in 20152 illustration

  55. Slide 55: Customer: Enriching customer experience

    Customer: Enriching customer experience Listening & Product Solutions Value added service Management of Understanding for all seasons customer interaction Customer Offer Strategy Drives value for both customers Tailored Propositions Multiple modes of customer and shareholders interaction Online insi

  56. Slide 56: Customer: Competitive edge

    Customer: Competitive edge Customer offer strategy delivers sustainable competitive advantages Customer service expectations set by Increasing share of wallet More than a third from Repeat Sales global service leaders Holding per customer Repeat 33% Q. How would you rate the overall performance of s

  57. Slide 57: Customer: Dynamic inforce management

    Customer: Dynamic inforce management Optimization across dimensions Delivering shareholder value Customer value and Life Value of In-force Business, £bn lifecycle management – Cost optimisation – Cost variabilisation – Leverage customer base – Claims optimisation 25% – Improve retention and – Data I

  58. Slide 58: Sustainability: 'Fit for Growth' service platform

    Sustainability: ‘Fit for Growth’ service platform Automating across value chain Supported by integrated risk framework Deepening our Cyber defences • Network Segmentation Automation • Secure web applications • Performance • Building for future metrics • Capture at source • Succession • Encryption of

  59. Slide 59: Sustainability: Creating capacity and driving efficiency

    Sustainability: Creating capacity and driving efficiency Core focus areas guide our operational excellence initiatives Growth Strategy Point of sales Performance Management 3.5 million new policies1 Channel Management Driving Efficiency Marketing 21 million in-force policies1 350 new products Underw

  60. Slide 60: All comes down to People

    All comes down to People Advantaged Platform Fit for growth Future Proofing 100% CEOs internally groomed  Strategic Talent plan to deliver growth CEO’s years of service - 12.6 years tenure  Gaining understanding of - 3.7 years in service Employees’ Preference Future: more complex and fluid 80% Top

  61. Slide 61: The outcome not a cause

    The outcome not a cause Leader in Asia with wide footprint in the right markets Indonesia Hong Kong Market Share: 22% Market Share: 18% Rank: 1 Rank: 2 Vietnam Thailand Market Share: 21% Market Share: 4% Rank: 1 Rank: 8 Singapore India Market Share: 19% Market Share: 9% Rank: 2 Rank: 1 (Private) Mal

  62. Slide 62: Continue to deliver with agility

    Continue to deliver with agility 24 consecutive Record Quarters • Consistent result amidst volatilities APE (£ m) • Sustained market out-performance • Focus to execute and deliver • Resilient platform underpinned by scale and diversity • Fundamentals are still compelling • Responding with adaptive c

  63. Slide 63: Prudential Hong Kong

    Prudential Hong Kong Derek Yung - Chief Executive Officer Ben Bulmer - Chief Financial Officer Anthony Shaw - Chief Officer, Marketing & Customer Service

  64. Slide 64: Forward Looking Statements

    Forward Looking Statements This document may contain ‘forward-looking statements’ with respect to certain of Prudential's plans and its goals and expectations relating to its future financial condition, performance, results, strategy and objectives. Statements that are not historical facts, includin

  65. Slide 65: Market Overview: Drivers of Domestic Demand

    Market Overview: Drivers of Domestic Demand Increasing wealth coupled with need for retirement planning and health protection fuel demand Retirement Savings Social Mandatory Savings Voluntary Savings Security & Corporate Pensions & Insurance  Government Pensions  MPF (Mandatory Provident Fund)  I

  66. Slide 66: Market Overview: Drivers of Mainland Demand

    Market Overview: Drivers of Mainland Demand Mainland visitors seeing the benefits of purchasing life insurance in Hong Kong Number of Mainlander visits has doubled Attractiveness of HK Policies PHKL Target Customer Base – Guangdong Province 0 48m GD Population (millions) 0 13.6 Visitor Arrival (m) 0

  67. Slide 67: Prudential Hong Kong: An Industry Leader

    Prudential Hong Kong: An Industry Leader A market leading company, delivering profitable and sustainable growth Delivering Excellence Market Positioning Differentiation Execution in Hong Kong(1)  “Value over volume”  Truly multi-channel  “Best in class” distribution with significant people and 

  68. Slide 68: Prudential Hong Kong: A Comprehensive Platform

    Prudential Hong Kong: A Comprehensive Platform Robust, holistic, infrastructure underpinning delivery Multi-channel Customer Academy of Financial Services Integrated Sales Platform & Distribution Servicing Front Office − Digital − Medical Centers Licensing & Training & − Inbound/ outbound − Customer

  69. Slide 69: Prudential Hong Kong: Performance Overview

    Prudential Hong Kong: Performance Overview Consistency of execution delivering strong growth across all metrics APE Growth (£,m) New Business Profit, post tax (£,m) Margin 53% 62% 2010 2011 2012 2013 2014 1H 2015 2010 2011 2012 2013 2014 1H 2015 IFRS Operating Profits (£,m) Inforce Operating Free Su

  70. Slide 70: Prudential Hong Kong: Quality of Business

    Prudential Hong Kong: Quality of Business A balanced, actively managed portfolio Diversified business model generating quality growth IFRS earnings driven by increased insurance margin Insurance Multi-Channel Balanced Local HK Market Margin 41% 61% Distribution Portfolio Mix vs. MCH Non Par & Unit L

  71. Slide 71: Prudential Hong Kong: Policyholders

    Prudential Hong Kong: Policyholders Mainland policyholders broadly similar to the local population Distribution of Premium Size (2015 1H New Business) Distribution of PHKL’s Mainland Customers 31% 24% 26% 16%18% 12% 14% 10% 11% 7% 8% 8% 4% 5% 5% 2% HK & Others MCH APE Distribution by Product (2015 1

  72. Slide 72: Prudential's Distribution Strengths: Agency

    Prudential’s Distribution Strengths: Agency A high performing, growing agency force APE We build and nurture high calibre agents Agency Channel APE 2010 2011 2012 2013 2014 1H 2015 Market Share Agent’s # Market Share 16% 16% 16% 16% 20% 23% Agent’s #  An actively growing, highly professional agency

  73. Slide 73: Prudential's Distribution Strengths: Partnerships

    Prudential’s Distribution Strengths: Partnerships Broadening partnerships to increase reach and consumer choice Prudential & SCB: Unparalleled Success in an Unique Partnership Broker Distribution: Developing a Material New Business Channel  Unique IS Model, In-branch sales  Over 150 Insurance Spec

  74. Slide 74: Prudential's Product Innovation: Meeting Needs

    Prudential’s Product Innovation: Meeting Needs New and innovative products meeting customers needs PAR Plan Health & Protection Plans Evergreen Growth Saver PRUmyhealth crisis lifelong care PRUmyhealth cancer protector  Flagship wealth accumulation product  Flagship CI product with extensive criti

  75. Slide 75: Prudential Hong Kong: A Company of Choice

    Prudential Hong Kong: A Company of Choice Well positioned for ongoing success Agency Partnerships Distribution Market leading multi-channel 37.7% 63% 19.5% distribution Market Share(1) Productivity Higher Than Market Unparalleled Success Market Share(2) of Agency Channel Average in an Unique Partner

  76. Slide 76: Eastspring Investments

    Eastspring Investments Guy Strapp - Chief Executive Michele Bang - Deputy Chief Executive

  77. Slide 77: Forward Looking Statements

    Forward Looking Statements This document may contain ‘forward-looking statements’ with respect to certain of Prudential's plans and its goals and expectations relating to its future financial condition, performance, results, strategy and objectives. Statements that are not historical facts, includin

  78. Slide 78: Net Flows

    Net Flows Record net flows External Client Net Flows, ex-MMF £ bn Equity Fixed Income YOY 5.4 +33% 4.9 3.7 1.8 1.6 1.6 0.6 0.6 0.6 2008 2009 2010 2011 2012 2013 2014 9M 2014 9M 2015 Note: Numbers are at actual exchange rate (AER). 2

  79. Slide 79: Net Flows

    Net Flows Record net flows TotalClient External Net Flows, ex-MMF Net Flows, £ bn £ bn ex-MMF YOY +27% 10.3 10.0 Life External Client ex-MMF 7.9 4.7 4.2 3.8 3.2 1.7 0.9 2008 2009 2010 2011 2012 2013 2014 9M 2014 9M 2015 Note: Numbers are at actual exchange rate (AER). 3

  80. Slide 80: Scale and Profitability

    Scale and Profitability Record FUM and profits FUM and Asset Mix, £ bn Pre-Tax Profits, £ m YTD +7% CAGR CAGR +13% 82 +8% 90 77 7% 7% YOY 60 70 68 +35% 58 63 52 8% 41% 43% 57 63 58 50 8% 9% 9% 50 42 37 14% 32% 43% 43% 43 11% 40% 28% 37% 52% 50% 59% 49% 49% 58% 51% 52% 2008 2009 2010 2011 2012 2013 2

  81. Slide 81: Solid Delivery Despite Challenging Market

    Solid Delivery Despite Challenging Market Consistently positive flows despite outflows seen in the industry Net Flows into Asia ex-Japan Equity Funds (Cumulative), £ bn 10 Eastspring Investments 5 (External Client Net Flows) -5 -10 -15 -20 Industry -25 Dec'13 Mar'14 Dec'14 Mar'15 Jun'14 Sep'14 Jun'1

  82. Slide 82: Diversified Business Platform

    Diversified Business Platform Helps insulate financial results Country Mix Client Mix Asset Mix (External Client Monies) 1% Others 7% 3% Malaysia 12% Non Asia Life Money Market 7% Hong Kong 9% Singapore 9% Taiwan External Clients 43% Fixed Income 41% (Retail & Institutional) 12% China 16% Korea 12%

  83. Slide 83: Investment Performance

    Investment Performance Consistently outperforming Percentage of Funds Outperforming Over 3 Year Periods1 90% 80% 73% 70% 74% 66% 62% 62% 60% 64% 50% 55% 40% 30% 20% 10% 0% Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Nov-15 1. Proportion of funds (based on 50% No. of funds + 50% FUM of funds) ex

  84. Slide 84: Operating Margins vs Industry

    Operating Margins vs Industry Industry leading profitability1 Eastspring vs Global Asset Management Industry Operating Margins 50 Operating Margins (%) 40 39 40 36 37 35 37 33 32 34 30 30 32 26 28 31 20 10 0 2008 2009 2010 2011 2012 2013 2014 Industry 75th percentile Eastspring Industry Median Media

  85. Slide 85: Strategic Priorities For Eastspring

    Strategic Priorities For Eastspring Consistent execution of strategic priorities  Infrastructure and negotiated credit • Teams established Deepen Investment • Actively investing Capabilities  Expanding China coverage  Adding multi-asset  Customised solutions for Life companies Partner with Life

  86. Slide 86: Asia – The Opportunity Is Large

    Asia – The Opportunity Is Large Asia represents 11% of global AUM: Circa £4 trillion Mutual fund asset growth – 5 year CAGR: Asia ex-Japan 15% vs. Global 8% Low penetration of mutual funds as % of household assets: Asia – 6% US – 17% EU – 12% Large asset pools in North Asia today (Circa £3.5tr / 75%

  87. Slide 87: Partner With Life

    Partner With Life Life Business (Sep 15) Client profile: Institutional and Retail 59% of Eastspring FUM and 36% of revenue FUM: year-on-year increase of 9%¹ - £45bn to £49bn Presence in 14 markets Breakdown by Region (Sep 15) Partner with Life to develop local and regional investment £ 49bn capabili

  88. Slide 88: Capturing Value Across Markets - Japan

    Capturing Value Across Markets - Japan Retirement demographics / low interest rate environment: Income products Introduction of tax incentivized Nippon Individual Savings Account: £11bn p.a. into Investment Trust products over next 5 yrs; 9.2m accounts had been opened in last 18 mths¹ Japan Successf

  89. Slide 89: Capturing Value Across Markets - Korea

    Capturing Value Across Markets - Korea Strong domestic biased market: Retail & Institutional slowly diversifying into offshore investments Top performing Korean equity team: Top quartile performance1 over 1yr, 2yr, 3yr – managing assets for large Pension clients, Insurers and Retail funds Korea Comp

  90. Slide 90: Capturing Value Across Markets – India (ICICI-Pru Joint Venture)

    Capturing Value Across Markets – India (ICICI-Pru Joint Venture) Burgeoning Retail market: £132bn1 (CAGR of 22%1 since 2012) ICICI-Pru represents 13% of the mutual fund market1 India Comprehensive distribution: 87%2 of distributors selling ICICI-Pru’s funds, 15%3 of all sales through digital medium

  91. Slide 91: Summary

    Summary  Eastspring delivering record results across all key metrics despite a decline in markets  Unique geographic footprint providing local and pan Asian investment coverage and both onshore and offshore product solutions with a diversified source of assets – 60% Life and 40% 3rd Party  Solid

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