Document and Entity Information
Document and Entity Information | 6 Months Ended |
Jun. 30, 2019 | |
Document and Entity Information | |
Entity Registrant Name | PRUDENTIAL PLC |
Entity Central Index Key | 0001116578 |
Document Type | 6-K |
Document Period End Date | Jun. 30, 2019 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2019 |
Document Fiscal Period Focus | Q2 |
Unaudited condensed consolidate
Unaudited condensed consolidated income statements - GBP (£) £ in Millions | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | ||
Profit from continuing operations: | |||
Gross premiums earned | £ 16,293 | £ 14,786 | |
Outward reinsurance premiums | (520) | (363) | |
Earned premiums, net of reinsurance | 15,773 | 14,423 | |
Investment return | 24,633 | 1,381 | |
Other income | 199 | 215 | |
Total revenue, net of reinsurance | 40,605 | 16,019 | |
Benefits and claims and movement in unallocated surplus of with-profits funds, net of reinsurance | (36,671) | (10,928) | |
Acquisition costs and other expenditure | (2,711) | (3,285) | |
Finance costs: interest on core structural borrowings of shareholder-financed businesses | (226) | (189) | |
Gain (loss) on disposal of businesses and corporate transactions | 13 | (57) | |
Total charges, net of reinsurance and gain (loss) on disposal of businesses | (39,595) | (14,459) | |
Share of profits from joint ventures and associates, net of related tax | 106 | 82 | |
Profit before tax (being tax attributable to shareholders' and policyholders' returns) | [1],[2] | 1,116 | 1,642 |
Less tax charge attributable to policyholders' returns | (220) | (43) | |
Profit before tax attributable to shareholders | 896 | 1,599 | |
Total tax charge attributable to policyholders and shareholders | (221) | (369) | |
Adjustment to remove tax charge attributable to policyholders' returns | 220 | 43 | |
Tax charge attributable to shareholders' returns | (1) | (326) | |
Profit from continuing operations for the period | 895 | 1,273 | |
Profit from discontinued operations for the period, net of related tax | [3] | 645 | 83 |
Profit for the period | 1,540 | 1,356 | |
Attributable to: | |||
Equity holders of the Company from continuing operations | 890 | 1,272 | |
Equity holders of the Company from discontinued operations | 645 | 83 | |
Non-controlling interests from continuing operations | 5 | 1 | |
Profit for the period | £ 1,540 | £ 1,356 | |
Basic | |||
Based on profit from continuing operations (in GBP per share) | £ 0.344 | £ 0.495 | |
Based on profit from discontinued operations (in GBP per share) | [3] | 0.250 | 0.032 |
Basic (in GBP per share) | 0.594 | 0.527 | |
Diluted | |||
Based on profit from continuing operations (in GBP per share) | 0.344 | 0.494 | |
Based on profit from discontinued operations (in GBP per share) | [3] | 0.250 | 0.032 |
Diluted (in GBP per share) | 0.594 | 0.526 | |
Dividends relating to reporting period: | |||
First interim ordinary dividend (in GBP per share) | 0.1645 | 0.1567 | |
Dividends paid in reporting period: | |||
Second interim ordinary dividend for prior year (in GBP per share) | £ 0.3368 | £ 0.3250 | |
[1] | This measure is the formal profit before tax measure under IFRS but it is not the result attributable to shareholders, as explained in footnote (i) of the ‘Condensed consolidated income statements’. | ||
[2] | This measure is the formal profit before tax measure under IFRS but it is not the result attributable to shareholders. This is principally because the corporate taxes of the Group include those on the income of consolidated with-profits and unit-linked funds that, through adjustments to benefits, are borne by policyholders. These amounts are required to be included in the tax charge of the Company under IAS 12. Consequently, the profit before all taxes measure is not representative of pre-tax profits attributable to shareholders. Profit before all taxes is determined after deducting the cost of policyholder benefits and movements in the liability for unallocated surplus of with-profits funds after adjusting for taxes borne by policyholders. | ||
[3] | Profit from discontinued operations represents the post-tax profit contributed by the UK and Europe operations which are classified as held for distribution at 30 June 2019 (a line-by-line analysis of profit for the period for the discontinued UK and Europe operations is included in note D2.1).The half year 2018 comparative results have been re-presented from those previously published accordingly (as described in note A2). |
Unaudited condensed consolida_2
Unaudited condensed consolidated statements of comprehensive income - GBP (£) £ in Millions | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | ||
Unaudited condensed consolidated statements of comprehensive income | |||
Profit for the period from continuing operations | £ 895 | £ 1,273 | |
Exchange movements on foreign operations and net investment hedges: | |||
Exchange movements arising during the period | 95 | 70 | |
Related tax | 1 | 2 | |
Exchange movements on foreign operations and net investment hedges | 96 | 72 | |
Net unrealised valuation movements on securities of US insurance operations classified as available-for-sale: | |||
Net unrealised holding gains (losses) arising in the period | 2,636 | (1,392) | |
Deduct net gains included in the income statement on disposal and impairment | (19) | (29) | |
Total | 2,617 | (1,421) | |
Related change in amortisation of deferred acquisition costs | (432) | 272 | |
Related tax | (459) | 241 | |
Net unrealised valuation movements on securities of US insurance operations classified as available-for-sale | 1,726 | (908) | |
Total items that may be reclassified subsequently to profit or loss | 1,822 | (836) | |
Shareholders' share of actuarial gains and (losses) on defined benefit pension schemes: | |||
Net actuarial (losses) gains on defined benefit pension schemes | (86) | 3 | |
Related tax | 14 | (1) | |
Total items that will not be reclassified to profit or loss | (72) | 2 | |
Other comprehensive income (loss) from continuing operations for the period, net of related tax | 1,750 | (834) | |
Total comprehensive income (loss) for the period from continuing operations | 2,645 | 439 | |
Profit for the period from discontinued operations | [1] | 645 | 83 |
Other comprehensive income from discontinued operations | 4 | 62 | |
Total comprehensive income for the period from discontinued operations | 649 | 145 | |
Total comprehensive income (loss) for the period | 3,294 | 584 | |
Attributable to: | |||
Equity holders of the Company from continuing operations | 2,640 | 438 | |
Equity holders of the Company from discontinued operations | 649 | 145 | |
Non-controlling interests from continuing operations | 5 | 1 | |
Total comprehensive income (loss) for the period | £ 3,294 | £ 584 | |
[1] | Profit from discontinued operations represents the post-tax profit contributed by the UK and Europe operations which are classified as held for distribution at 30 June 2019 (a line-by-line analysis of profit for the period for the discontinued UK and Europe operations is included in note D2.1).The half year 2018 comparative results have been re-presented from those previously published accordingly (as described in note A2). |
Unaudited condensed consolida_3
Unaudited condensed consolidated statement of changes in equity - GBP (£) £ in Millions | Shareholders' equity | Share capital | Share premium | Retained earnings | Translation reserve | Available-for-sale securities reserves | Non-controlling interests | Total |
Reserves | ||||||||
Profit from continuing operations for the period | £ 1,272 | £ 1,272 | £ 1 | £ 1,273 | ||||
Other comprehensive income (loss) from continuing operations | (834) | 2 | £ 72 | £ (908) | (834) | |||
Total comprehensive income (loss) for the period from continuing operations | 438 | 1,274 | 72 | (908) | 1 | 439 | ||
Total comprehensive income (loss) from discontinued operations for the period | 145 | 148 | (3) | 145 | ||||
Total comprehensive income (loss) for the period | 583 | 1,422 | 69 | (908) | 1 | 584 | ||
Dividends | (840) | (840) | (840) | |||||
Reserve movements in respect of share-based payments | (9) | (9) | (9) | |||||
Share capital and share premium | ||||||||
New share capital subscribed | 6 | £ 6 | 6 | |||||
Treasury shares | ||||||||
Movement in own shares in respect of share-based payment plans | 28 | 28 | 28 | |||||
Movement in Prudential plc shares purchased by unit trusts consolidated under IFRS | 27 | 27 | 27 | |||||
Net increase (decrease) in equity | (205) | 6 | 628 | 69 | (908) | 1 | (204) | |
At beginning of period at Dec. 31, 2017 | 16,087 | £ 129 | 1,948 | 12,326 | 840 | 844 | 7 | 16,094 |
At end of period at Jun. 30, 2018 | 15,882 | 129 | 1,954 | 12,954 | 909 | (64) | 8 | 15,890 |
Share capital and share premium | ||||||||
New share capital subscribed | 1 | 16 | ||||||
At beginning of period at Dec. 31, 2017 | 16,087 | 129 | 1,948 | 12,326 | 840 | 844 | 7 | 16,094 |
At end of period at Dec. 31, 2018 | 17,249 | 130 | 1,964 | 14,206 | 1,188 | (239) | 18 | 17,267 |
Reserves | ||||||||
Profit from continuing operations for the period | 890 | 890 | 5 | 895 | ||||
Other comprehensive income (loss) from continuing operations | 1,750 | (72) | 96 | 1,726 | 1,750 | |||
Total comprehensive income (loss) for the period from continuing operations | 2,640 | 818 | 96 | 1,726 | 5 | 2,645 | ||
Total comprehensive income (loss) from discontinued operations for the period | 649 | 647 | 2 | 649 | ||||
Total comprehensive income (loss) for the period | 3,289 | 1,465 | 98 | 1,726 | 5 | 3,294 | ||
Dividends | (870) | (870) | (870) | |||||
Reserve movements in respect of share-based payments | 2 | 2 | 2 | |||||
Share capital and share premium | ||||||||
New share capital subscribed | 10 | 10 | 10 | |||||
Treasury shares | ||||||||
Movement in own shares in respect of share-based payment plans | (9) | (9) | (9) | |||||
Movement in Prudential plc shares purchased by unit trusts consolidated under IFRS | 1 | 1 | 1 | |||||
Net increase (decrease) in equity | 2,423 | 10 | 589 | 98 | 1,726 | 5 | 2,428 | |
At end of period at Jun. 30, 2019 | £ 19,672 | £ 130 | £ 1,974 | £ 14,795 | £ 1,286 | £ 1,487 | £ 23 | £ 19,695 |
Unaudited condensed consolida_4
Unaudited condensed consolidated statements of financial position - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | ||
Assets | ||||
Goodwill | £ 510 | |||
Deferred acquisition costs and other intangible assets | 12,659 | |||
Property, plant and equipment | 785 | [1] | £ 378 | |
Reinsurers' share of insurance contract liabilities | 10,151 | |||
Deferred tax assets | 2,762 | |||
Current tax recoverable | 371 | |||
Accrued investment income | 1,332 | |||
Other debtors | 2,011 | |||
Investment properties | 11 | |||
Investment in joint ventures and associates accounted for using the equity method | 1,030 | |||
Loans | 12,513 | 12,443 | ||
Equity securities and portfolio holdings in unit trusts | [2] | 183,670 | ||
Debt securities | 99,675 | [2] | 89,400 | |
Derivative assets | 1,222 | |||
Other investments | [2] | 958 | ||
Deposits | 1,491 | |||
Assets held for distribution | [3] | 218,324 | ||
Cash and cash equivalents | 5,208 | |||
Total assets | 554,683 | |||
Equity | ||||
Shareholders' equity | 19,672 | |||
Non-controlling interests | 23 | |||
Total equity | 19,695 | 17,267 | ||
Liabilities | ||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 285,168 | |||
Unallocated surplus of with-profits funds | 2,944 | |||
Core structural borrowings of shareholder-financed businesses | 7,441 | |||
Operational borrowings attributable to shareholder-financed businesses | [1] | 1,664 | ||
Borrowings attributable to with-profits businesses | [1] | 238 | ||
Obligations under funding, securities lending and sale and repurchase agreements | 6,756 | |||
Net asset value attributable to unit holders of consolidated unit trusts and similar funds | 3,482 | |||
Deferred tax liabilities | 3,701 | |||
Current tax liabilities | 319 | |||
Accruals, deferred income and other liabilities | 10,597 | |||
Provisions | 254 | |||
Derivative liabilities | 1,037 | |||
Liabilities held for distribution | [3] | 211,387 | ||
Total liabilities | 534,988 | |||
Total equity and liabilities | £ 554,683 | |||
Continuing and discontinued operations | ||||
Assets | ||||
Goodwill | 1,857 | |||
Deferred acquisition costs and other intangible assets | 11,923 | |||
Property, plant and equipment | [1] | 1,409 | ||
Reinsurers' share of insurance contract liabilities | 11,144 | |||
Deferred tax assets | 2,595 | |||
Current tax recoverable | 618 | |||
Accrued investment income | 2,749 | |||
Other debtors | 4,088 | |||
Investment properties | 17,925 | |||
Investment in joint ventures and associates accounted for using the equity method | 1,733 | |||
Loans | 18,010 | |||
Equity securities and portfolio holdings in unit trusts | [2] | 214,733 | ||
Debt securities | [2] | 175,356 | ||
Derivative assets | 3,494 | |||
Other investments | [2] | 6,512 | ||
Deposits | 11,796 | |||
Assets held for sale | 10,578 | |||
Cash and cash equivalents | 12,125 | |||
Total assets | 508,645 | |||
Equity | ||||
Shareholders' equity | 17,249 | |||
Non-controlling interests | 18 | |||
Total equity | 17,267 | |||
Liabilities | ||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 409,301 | |||
Unallocated surplus of with-profits funds | 15,845 | |||
Core structural borrowings of shareholder-financed businesses | 7,664 | |||
Operational borrowings attributable to shareholder-financed businesses | [1] | 998 | ||
Borrowings attributable to with-profits businesses | [1] | 3,940 | ||
Obligations under funding, securities lending and sale and repurchase agreements | 6,989 | |||
Net asset value attributable to unit holders of consolidated unit trusts and similar funds | 11,651 | |||
Deferred tax liabilities | 4,022 | |||
Current tax liabilities | 568 | |||
Accruals, deferred income and other liabilities | 15,248 | |||
Provisions | 1,078 | |||
Derivative liabilities | 3,506 | |||
Liabilities held for sale | 10,568 | |||
Total liabilities | 491,378 | |||
Total equity and liabilities | £ 508,645 | |||
[1] | As at 1 January 2019, the Group applied IFRS 16, ‘Leases’, using the modified retrospective approach. Under this approach, comparative information is not restated. The application of the standard has resulted in the recognition of an additional lease liability and a corresponding ‘right-of-use’ asset of a similar amount as at 1 January 2019. See note A3 for further details. As at 30 June 2019, right-of-use assets recognised in property, plant and equipment for continuing operations amounted to £425 million. | |||
[2] | Included within equity securities and portfolio holdings in unit trusts, debt securities and other investments are £8 million of lent securities as at 30 June 2019 (31 December 2018: £8,278 million). | |||
[3] | Assets and liabilities held for distribution relate to the Group’s UK and Europe operations, which have been classified as discontinued operations at 30 June 2019 and are presented above after the elimination of intra-Group balances with the continuing operations (see note C1). A line-by-line analysis of assets and liabilities for the discontinued UK and Europe operations before elimination of such intra-Group balances, is included in note D2.2. The 2018 comparative results for the assets and liabilities at 31 December 2018 are as published and not re-presented on a basis consistent with half year 2019 (as described in note A2). |
Unaudited condensed consolida_5
Unaudited condensed consolidated statements of financial position (Parenthetical) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Unaudited condensed consolidated statements of financial position | ||
Right-of-use assets | £ 425 | |
Lent securities | £ 8 | £ 8,278 |
Unaudited condensed consolida_6
Unaudited condensed consolidated statements of cash flows - GBP (£) £ in Millions | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | ||
Cash flows from operating activities | |||
Profit before tax (being tax attributable to shareholders' and policyholders' returns) | [1],[2] | £ 1,116 | £ 1,642 |
Adjustments to profit before tax for non-cash movements in operating assets and liabilities: | |||
Investments | (29,889) | (3,439) | |
Other non-investment and non-cash assets | (2,075) | (58) | |
Policyholder liabilities (including unallocated surplus) | 26,820 | 2,186 | |
Other liabilities (including operational borrowings) | 3,147 | 292 | |
Other items | [3] | 97 | 357 |
Net cash flows from operating activities | (784) | 980 | |
Cash flows from investing activities | |||
Net cash flows from purchases and disposals of property, plant and equipment | (16) | (59) | |
Net cash flows from corporate transactions | [4] | (72) | (132) |
Net cash flows from investing activities | (88) | (191) | |
Equity capital: | |||
Issues of ordinary share capital | 10 | 6 | |
Dividends paid | (870) | (840) | |
Net remittances from discontinued operations | 356 | 341 | |
Net cash flows from financing activities | (1,274) | (680) | |
Net increase in cash and cash equivalents from continuing operations | (2,146) | 109 | |
Net cash flows from discontinued operations | [5] | (124) | (2,380) |
Cash and cash equivalents at beginning of period | 12,125 | 10,690 | |
Effect of exchange rate changes on cash and cash equivalents | (23) | 31 | |
Cash and cash equivalents at end of period | 9,832 | 8,450 | |
Comprising: | |||
Cash and cash equivalents from continuing operations | 5,208 | 5,030 | |
Cash and cash equivalents from discontinued operations | 4,624 | 3,420 | |
Shareholder-backed | |||
Structural borrowings of the Group: | |||
Redemption of subordinated debt | [6] | (400) | |
Fees paid to modify terms and conditions of debt issued by the Group | [6],[7] | (141) | |
Interest paid | [6] | £ (229) | £ (187) |
[1] | This measure is the formal profit before tax measure under IFRS but it is not the result attributable to shareholders, as explained in footnote (i) of the ‘Condensed consolidated income statements’. | ||
[2] | This measure is the formal profit before tax measure under IFRS but it is not the result attributable to shareholders. This is principally because the corporate taxes of the Group include those on the income of consolidated with-profits and unit-linked funds that, through adjustments to benefits, are borne by policyholders. These amounts are required to be included in the tax charge of the Company under IAS 12. Consequently, the profit before all taxes measure is not representative of pre-tax profits attributable to shareholders. Profit before all taxes is determined after deducting the cost of policyholder benefits and movements in the liability for unallocated surplus of with-profits funds after adjusting for taxes borne by policyholders. | ||
[3] | The adjusting items to profit before tax included within other items are adjustments in respect of non-cash items together with operational interest receipts and payments, dividend receipts and tax paid. | ||
[4] | Net cash flows from corporate transactions include amounts paid for distribution rights and cash flows arising from the acquisitions and disposals of businesses. | ||
[5] | Net cash flows from discontinued operations represents the movement in cash and cash equivalents from the UK and Europe operations, which are classified as held for distribution at 30 June 2019. A detailed analysis of cash flows for the period for the discontinued UK and Europe operations is included in note D2.3. The half year 2018 comparative results have been re-presented from those previously published accordingly (as described in note A2). | ||
[6] | Structural borrowings of shareholder-financed businesses exclude borrowings to support short-term fixed income securities programmes, non-recourse borrowings of investment subsidiaries of shareholder-financed businesses and other borrowings of shareholder-financed businesses. Cash flows in respect of these borrowings are included within cash flows from operating activities. | ||
[7] | In the first half of 2019, the Group agreed with the holders of two subordinated debt instruments to alter the terms and conditions of these instruments in exchange for an upfront fee and an increase in the coupon of the instruments. The upfront fee and increase in coupon rates represent a significant change in the cash flows of each instrument and therefore, in accordance with IAS 39, has resulted in an extinguishment of the old debt and recognition of a new debt at fair value, the net effect of which is a non-cash movement in debt of £169 million. The upfront fee paid of £141 million has been expensed and is shown in the cash flow statement above (see note C6.1 for further details). |
Unaudited condensed consolida_7
Unaudited condensed consolidated statements of cash flows (Parenthetical) - Core structural borrowings of shareholder-financed businesses - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Changes in the carrying value of the structural borrowings of shareholder-financed businesses are analysed as follows: | ||
Balance at beginning of period | £ 7,664 | £ 6,280 |
Redemption of debt | (400) | |
Foreign exchange movement | 8 | 83 |
Non-cash movements for changes to terms of debt | 169 | |
Other movements | 4 | |
Balance at end of period | £ 7,441 | £ 6,367 |
BACKGROUND
BACKGROUND | 6 Months Ended |
Jun. 30, 2019 | |
BACKGROUND | |
Background | A BACKGROUND A1 Basis of preparation, audit status and exchange rates These condensed consolidated interim financial statements for the six months ended 30 June 2019 have been prepared in accordance with IAS 34 ‘Interim Financial Reporting’ as issued by the International Accounting Standards Board (IASB) and as endorsed by the European Union (EU). The Group’s policy for preparing this interim financial information is to use the accounting policies adopted by the Group in its last consolidated financial statements, as updated by any changes in accounting policies it intends to make in its next consolidated financial statements as a result of new or amended IFRS and other policy improvements. EU-endorsed IFRS may differ from IFRSs issued by the IASB if, at any point in time, new or amended IFRS have not been endorsed by the EU. At 30 June 2019, there were no unendorsed standards effective for the period ended 30 June 2019 which impacted the condensed consolidated financial statements of the Group, and there were no differences between IFRS endorsed by the EU and IFRS issued by the IASB in terms of their application to the Group. The IFRS basis results for half year 2019 and half year 2018 are unaudited. Except for re-presenting the results for UK and Europe operations as discontinued operations, the 2018 full year IFRS basis results have been derived from Prudential’s 2018 audited consolidated financial statements filed with the Securities and Exchange Commission on Form 20-F. These 2018 consolidated financial statements do not represent Prudential’s statutory accounts for the purpose of the UK Companies Act 2006. The auditors have reported on the 2018 statutory accounts which have been delivered to the Registrar of Companies. The auditors’ report was: (i) unqualified; (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report; and (iii) did not contain a statement under section 498(2) or (3) of the Companies Act 2006. The exchange rates applied for balances and transactions in currencies other than the presentational currency of the Group, pounds sterling (GBP), were: Average Average Closing for the Closing for the Closing rate at 6 months to rate at 6 months to rate at 30 Jun 2019 30 Jun 2019 30 Jun 2018 30 Jun 2018 31 Dec 2018 Local currency: £ Hong Kong 9.94 10.15 10.36 10.78 9.97 Indonesia 17,980.07 18,364.05 18,919.18 18,938.64 18,314.37 Malaysia 5.26 5.33 5.33 5.42 5.26 Singapore 1.72 1.76 1.80 1.83 1.74 China 8.74 8.78 8.75 8.76 8.74 India 87.85 90.62 90.46 90.37 88.92 Vietnam 29,660.27 30,087.11 30,310.96 31,329.01 29,541.15 Thailand 39.06 40.91 43.74 43.66 41.47 US 1.27 1.29 1.32 1.38 1.27 The accounting policies applied by the Group in determining the IFRS basis results in this report are the same as those previously applied in the Group’s consolidated financial statements for the year ended 31 December 2018, as disclosed in the 2018 Form 20‑F, aside from those discussed in note A3 below. A2 Discontinued operations The Group is planning to demerge its UK and Europe operations, M&GPrudential, from the Prudential plc group in the fourth quarter of 2019. Following an assessment at 30 June 2019, in accordance with IFRS 5, ‘ Non-current assets held for sale and discontinued operations ’, the results of M&GPrudential have been classified as held for distribution and as discontinued operations at 30 June 2019 in these condensed consolidated financial statements. In order to present the results of the continuing operations on a comparable basis and consistent with IFRS 5 requirements, results attributable to the discontinued UK and Europe operations in half year 2019 have been shown in a single line in the income statement with 2018 comparatives being restated accordingly. Notes B1 to B5 have been prepared on a consistent basis. IFRS 5 requires the assets and liabilities of the UK and Europe operations at 30 June 2019 to be presented as single line 'assets held for distribution' and 'liabilities held for distribution' on the statement of financial position but does not permit the comparative 31 December 2018 assets and liabilities to be re-presented as the UK and Europe operations were not classified as held for distribution at these dates. In the related balance sheet notes, prior period balances have been presented to show the amounts from discontinued operations separately from continuing operations. Additionally, in the analysis of movements in Group assets and liabilities between the beginning and end of periods, the balances of the discontinued UK and Europe operations are removed from the opening balances to show the underlying movements from continuing operations. The profit from the discontinued UK and Europe operations is presented in the condensed consolidated income statement before the elimination of intragroup transactions with continuing operations in order to provide a more meaningful presentation of the position of the Group immediately after the proposed demerger. The condensed consolidated statement of financial position has been presented after the elimination of all intragroup balances. A detailed analysis of the earnings performance, financial position and cash flows in the periods from the discontinued UK and Europe operations is provided in note D2, with supplementary analysis on adjusted IFRS operating profit based on longer-term investment returns by driver provided in note I(vi) within the additional financial information. A3 New accounting pronouncements in 2019 IFRS 16, ‘Leases’ The Group has adopted IFRS 16, 'Leases' from 1 January 2019. The new standard brings most leases on-balance-sheet for lessees under a single model, eliminating the distinction between operating and finance leases. IFRS 16 applies primarily to operating leases of major properties occupied by the Group’s businesses where Prudential is a lessee. Under IFRS 16, these leases are brought onto the Group’s statement of financial position with a ‘right-of-use’ asset being established and a corresponding liability representing the obligation to make lease payments. The rental accrual charge in the income statement under IAS 17 is replaced with a depreciation charge for the ‘right-of-use’ asset and an interest expense on the lease liability leading to a more front-loaded operating lease cost profile compared to IAS 17. As permitted by IFRS 16, the Group has chosen to adopt the modified retrospective approach upon transition to the new standard. Under the approach adopted, there is no adjustment to the Group’s retained earnings at 1 January 2019 and the Group’s 2018 comparative information is not restated. The right-of-use asset and lease liability at 1 January 2019 is set at an amount equal to the discounted remaining lease payments adjusted by any prepaid or accrued lease payment balance immediately before the date of initial application of the standard. When measuring lease liabilities on adoption, the Group discounted lease payments using its incremental borrowing rate at 1 January 2019. The weighted-average rate applied is 3.4 per cent. The aggregate effect of the adoption of the standard on the statement of financial position at 1 January 2019 is shown in the tables below: Consolidated statement of financial position Continuing Discontinued Effect of adoption of IFRS 16 at 1 January 2019 £m operations operations* Total Group Assets Property, plant and equipment (Right-of-use assets) 414 289 703 Total assets 414 289 703 Liabilities Operational borrowings attributable to shareholder-financed businesses (Lease liability) 206 304 510 Borrowings attributable to with-profits businesses (Lease liability) 219 21 240 Accruals, deferred income and other liabilities (Accrued lease payment balance under IAS 17) (11) (36) (47) Total liabilities 414 289 703 * Presented within assets and liabilities held for distribution at 30 June 2019. The Group has applied the practical expedient to grandfather the definition of a lease on transition. This means that IFRS 16 has been applied to all contracts, which were identified as leases in accordance with IAS 17 and IFRIC 4, ‘ Determining whether an Arrangement contains a Lease ’, entered into before 1 January 2019. Therefore, the definition of a lease under IFRS 16 was applied only to contracts entered into or changed on or after 1 January 2019. The Group has used the following practical expedients, in addition to the aforementioned when applying IFRS 16 to leases previously classified as operating leases under IAS 17: - Applied a single discount rate to a portfolio of leases with similar characteristics. Accordingly, for such portfolios, the incremental borrowing rates used to discount the future lease payments will be determined based on market specific risk-free rates adjusted with a margin/spread to reflect the Group’s credit standing, lease term and the outstanding lease payments. - Used hindsight when determining the lease term if the contract contains options to extend or terminate the lease. Other new accounting pronouncements In addition to the above, the IASB has also issued the following new accounting pronouncements to be effective from 1 January 2019: - IFRIC Interpretation 23, ‘Uncertainty over income tax treatments’; - Amendments to IAS 28, ‘Long-term Interests in Associates and Joint Ventures’; - Amendments to IFRS 9, 'Prepayment features with negative compensation'; - Annual Improvements to IFRSs 2015-2017 cycle; and - Amendments to IAS 19, ‘Plan Amendment, Curtailment or Settlement’. The Group has applied the principles within the Amendments to IAS 19, ' Plan Amendment, Curtailment or Settlement ', when accounting for the changes to the pension benefits of its UK defined benefit schemes during the period. The other pronouncements have had no significant impact on the Group financial statements. |
Analysis of performance by segm
Analysis of performance by segment | 6 Months Ended |
Jun. 30, 2019 | |
Analysis of performance by segment | |
Analysis of performance by segment | B EARNINGS PERFORMANCE B1 Analysis of performance by segment B1.1 Segment results 2019 £m 2018* £m Note Half year Half year note (iv) Asia: Insurance operations 1,095 927 Asset management 103 89 Total Asia 1,198 1,016 US: Jackson (US insurance operations) 1,203 1,001 Asset management 12 1 Total US 1,215 1,002 Total segment profit from continuing operations 2,413 2,018 Other income and expenditure: Investment return and other income 24 33 Interest payable on core structural borrowings note(i) (226) (189) Corporate expenditure note(ii) (164) (173) Total other income and expenditure (366) (329) Restructuring costs (23) (20) Adjusted IFRS operating profit based on longer-term investment returns from continuing operations B1.3 2,024 1,669 Short-term fluctuations in investment returns on shareholder-backed business B1.2 (1,124) 9 Amortisation of acquisition accounting adjustments note(iii) (17) (22) Gain (loss) on disposal of businesses and corporate transactions D1 13 (57) Profit from continuing operations before tax attributable to shareholders 896 1,599 Tax charge attributable to shareholders' returns B4 (1) (326) Profit from continuing operations for the period 895 1,273 Profit from discontinued operations for the period, net of related tax note(iv) D2.1 645 83 Profit for the period 1,540 1,356 Attributable to: Equity holders of the Company From continuing operations 890 1,272 From discontinued operations 645 83 Non-controlling interests from continuing operations 5 1 1,540 1,356 2018* Note Half year Half year Basic earnings per share (in pence) B5 note (iv) Based on adjusted IFRS operating profit based on longer-term investment returns, net of tax, from continuing operations note(v) 65.3 p 53.7 p Based on profit for the period from continuing operations 34.4 p 49.5 p Based on profit for the period from discontinued operations 25.0 p 3.2 p * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group's UK and Europe operations as discontinued operations at 30 June 2019 (as described in note A2). Notes (i) Interest charged to the income statement on debt that is capable of being substituted to M&GPrudential for the six months ended 30 June 2019 was £(85) million (see note C6.1 for further details). (ii) Corporate expenditure as shown above is primarily for Group Head Office and Asia Regional Head Office. (iii) Amortisation of acquisition accounting adjustments principally relate to the REALIC business of Jackson which was acquired in 2012. (iv) Profit from discontinued operations represents the post-tax profit contributed by the UK and Europe operations which are classified as held for distribution at 30 June 2019 (a line-by-line analysis of profit for the period for the discontinued UK and Europe operations is included in note D2.1, with supplementary analysis on adjusted IFRS operating profit based on longer-term investment returns by driver provided in note I(vi) within the additional financial information). The half year 2018 comparative results have been re-presented from those previously published accordingly (as described in note A2). (v) Tax charges have been reflected as operating and non-operating in the same way as for the pre-tax items. Further details on tax charges are provided in note B4. B1.2 Short-term fluctuations in investment returns on shareholder-backed business 2019 £m 2018* £m Half year Half year Asia operations note (i) 420 (326) US operations note (ii) (1,521) 244 Other operations note (iii) (23) 91 Total (1,124) 9 * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group’s UK and Europe operations as discontinued operations at 30 June 2019 (as described in note A2). (i) Asia operations In Asia, the positive short-term fluctuations of £420 million (half year 2018: negative £(326) million) principally reflect net value movements on shareholders’ assets and related liabilities following decrease in bond yields during the period. (ii) US operations The short-term fluctuations in investment returns for US insurance operations are reported net of the related credit for amortisation of deferred acquisition costs of £476 million as shown in note C5.2 (half year 2018: charge of £(199) million) and comprise amounts in respect of the following items: 2019 £m 2018 £m Half year Half year Net equity hedge result note (a) (1,955) 383 Other than equity-related derivatives note (b) 433 (183) Debt securities note (c) 11 6 Equity-type investments: actual less longer-term return (7) 31 Other items (3) 7 Total (1,521) 244 Notes (a) Net equity hedge result The purpose of the inclusion of this item in short-term fluctuations in investment returns is to segregate the amount included in pre-tax profit that relates to the accounting effect of market movements on both the value of guarantees in Jackson’s variable annuity and fixed index annuity products and on the related derivatives used to manage the exposures inherent in these guarantees. The level of fees recognised in non-operating profit is determined by reference to that allowed for within the reserving basis. The variable annuity guarantees are valued in accordance with either Accounting Standards Codification (ASC) Topic 820, Fair Value Measurements and Disclosures (formerly FAS 157) or ASC Topic 944, Financial Services – Insurance (formerly SOP 03-01) depending on the type of guarantee. Both approaches require an entity to determine the total fee (‘the fee assessment’) that is expected to fund future projected benefit payments arising using the assumptions applicable for that method. The method under FAS 157 requires this fee assessment to be fixed at the time of issue. As the fees included within the initial fee assessment are earned, they are included in non-operating profit to match the corresponding movement in the guarantee liability. As the Group applies US GAAP for the measured value of the product guarantees this item also includes asymmetric impacts where the measurement bases of the liabilities and associated derivatives used to manage the Jackson annuity business differ. The net equity hedge result therefore includes significant accounting mismatches and other factors that do not represent the economic result. These other factors include: - The variable annuity guarantees and fixed index annuity embedded options being only partially fair valued under ‘grandfathered’ US GAAP; - The interest rate exposure being managed through the other than equity-related derivative programme explained in note (b) below; and - Jackson’s management of its economic exposures for a number of other factors that are treated differently in the accounting frameworks such as future fees and assumed volatility levels. The net equity hedge result can be summarised as follows: 2019 £m 2018 £m Half year Half year Fair value movements on equity hedge instruments* (2,466) (375) Accounting value movements on the variable and fixed index annuity guarantee liabilities 227 505 Fee assessments net of claim payments 284 253 Total (1,955) 383 * Held to manage equity exposures of the variable annuity guarantees and fixed index annuity options. (b) Other than equity-related derivatives The fluctuations for this item comprise the net effect of: – – – The free-standing, other than equity-related derivatives, are held to manage interest rate exposures and durations within the general account and the variable annuity guarantees and fixed index annuity embedded options described in note (a) above. Accounting mismatches arise because of differences between the measurement basis and presentation of the derivatives, which are fair valued with movements recorded in the income statement, and the exposures they are intended to manage. (c) Short-term fluctuations related to debt securities 2019 £m 2018 £m Half year Half year (Charges) credits in the period: Losses on sales of impaired and deteriorating bonds (19) (1) Bond write-downs (1) (2) Recoveries/reversals 1 18 Total (charges) credits in the period (19) 15 Risk margin allowance deducted from adjusted IFRS operating profit based on longer-term investment returns* 42 38 23 53 Interest-related realised (losses) gains: Gains (losses) arising in the period 33 8 Amortisation of gains and losses arising in current and prior periods to adjusted IFRS operating profit based on longer-term investment returns (46) (57) (13) (49) Related amortisation of deferred acquisition costs 1 2 Total short-term fluctuations related to debt securities 11 6 * The debt securities of Jackson are held in the general account of the business. Realised gains and losses are recorded in the income statement with normalised returns included in adjusted IFRS operating profit based on longer-term investment returns with variations from period to period included in the short-term fluctuations category. The risk margin reserve charge for longer-term credit-related losses included in adjusted IFRS operating profit based on longer-term investment returns of Jackson for half year 2019 is based on an average annual risk margin reserve of 18 basis points (half year 2018: 19 basis points) on average book values of US$60.0 billion (half year 2018: US$54.9 billion) as shown below: Moody’s rating category Half year 2019 Half year 2018 (or equivalent under Average Average NAIC ratings of book book mortgage-backed value RMR Annual expected loss value RMR Annual expected loss securities) US$m % US$m £m US$m % US$m £m A3 or higher 34,318 0.10 (36) (28) 26,260 0.11 (29) (21) Baa1, 2 or 3 24,385 0.23 (55) (42) 27,337 0.20 (57) (41) Ba1, 2 or 3 1,008 0.93 (10) (7) 978 1.01 (10) (7) B1, 2 or 3 246 2.62 (6) (5) 309 2.61 (8) (6) Below B3 37 3.42 (1) (1) 11 3.71 — — Total 59,994 0.18 (108) (83) 54,895 0.19 (104) (75) Related amortisation of deferred acquisition costs 18 14 22 15 Risk margin reserve charge to adjusted IFRS operating profit for longer-term credit-related losses (90) (69) (82) (60) Consistent with the basis of measurement of insurance assets and liabilities for Jackson’s IFRS results, the charges and credits to adjusted IFRS operating profit based on longer-term investment returns are partially offset by related amortisation of deferred acquisition costs. In addition to the accounting for realised gains and losses described above for Jackson general account debt securities, included within the statement of other comprehensive income is a pre-tax credit of £2,185 million for net unrealised gains on debt securities classified as available-for-sale net of related amortisation of deferred acquisition costs (half year 2018: charge of £(1,149) million for net unrealised losses). Temporary market value movements do not reflect defaults or impairments. Additional details of the movement in the value of the Jackson portfolio are included in note C3.2(c). (iii) Other operations Short-term fluctuations in investment returns for other operations of negative £(23) million (half year 2018: positive £91 million) include unrealised value movements on financial instruments held outside of the main life operations. B1.3 Determining operating segments and performance measure of operating segments Operating segments The Group’s operating segments for financial reporting purposes are defined and presented in accordance with IFRS 8, ‘Operating Segments’ on the basis of the management reporting structure and its financial management information. Under the Group's management and reporting structure its chief operating decision maker is the Group Executive Committee (GEC). In the management structure, responsibility is delegated to the Chief Executive Officers of Prudential Corporation Asia, the North American Business Unit and M&GPrudential for the day-to-day management of their business units (within the framework set out in the Group Governance Manual). Financial management information used by the GEC aligns with these three business segments. These operating segments derive revenue from both long-term insurance and asset management activities. In light of the proposed demerger, the segment analysis for the discontinued UK and Europe operations is provided in note D2, separate from those for the continuing operations. Operations which do not form part of any business unit are reported as ‘Unallocated to a segment’. These include Group Head Office and Asia Regional Head Office costs. The Group’s existing treasury company, Prudential Capital, and the Africa operations do not form part of any operating segment under the structure, and their assets and liabilities and profit or loss before tax are not material to the overall financial position of the Group. Prudential Capital and Africa operations are therefore also reported as ‘Unallocated to a segment’. Performance measure The performance measure of operating segments utilised by the Company is adjusted IFRS operating profit based on longer-term investment returns attributable to shareholders. This measurement basis distinguishes adjusted IFRS operating profit based on longer-term investment returns from other constituents of the total profit as follows: – – – The determination of adjusted IFRS operating profit based on longer-term investment returns for investment and liability movements is as described in the Basis of Performance Measures section of this document. For Group debt securities at 30 June 2019 held by the continuing insurance operations in Asia and US, the level of unamortised interest-related realised gains and losses related to previously sold bonds and which have yet to be amortised to adjusted IFRS operating profit based on longer-term investment returns for continuing operations was a net gain of £580 million (30 June 2018: net gain of £800 million). For equity-type securities, the longer-term rates of return applied by the non-linked shareholder-financed insurance operations of Asia and the US to determine the amount of investment return included in adjusted IFRS operating profit based on longer-term investment returns are as follows: – – Half year Half year Equity-type securities such as common and preferred stock and portfolio holdings in mutual funds 6.0 % to 6.7 % 6.7 % to 7.0 % Other equity-type securities such as investments in limited partnerships and private equity funds 8.0 % to 8.7 % 8.7 % to 9.0 % B1.4 Additional segmental analysis of revenue from continuing operations Half year 2019 £m - continuing operations Unallocated to a segment Total (central Group Asia US segment operations) total Gross premiums earned 8,856 7,410 16,266 27 16,293 Outward reinsurance premiums (386) (131) (517) (3) (520) Earned premiums, net of reinsurance 8,470 7,279 15,749 24 15,773 Other income note (i) 176 11 187 12 199 Total external revenue 8,646 7,290 15,936 36 15,972 Intra-group revenue 16 24 40 (40) — Interest income 622 1,128 1,750 21 1,771 Other investment return 6,821 16,023 22,844 18 22,862 Total revenue, net of reinsurance note (ii) 16,105 24,465 40,570 35 40,605 Half year 2018* £m - continuing operations Unallocated to a segment Total (central Group Asia US segment operations) total Gross premiums earned 7,736 7,036 14,772 14 14,786 Outward reinsurance premiums (222) (141) (363) — (363) Earned premiums, net of reinsurance 7,514 6,895 14,409 14 14,423 Other income note (i) 157 44 201 14 215 Total external revenue 7,671 6,939 14,610 28 14,638 Intra-group revenue 20 32 52 (52) — Interest income 513 940 1,453 26 1,479 Other investment return (1,703) 1,486 (217) 119 (98) Total revenue, net of reinsurance note(ii) 6,501 9,397 15,898 121 16,019 * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group's UK and Europe operations as discontinued operations at 30 June 2019 (as described in note A2). Notes (i) Other income comprises income from external customers and consists primarily of revenue from the Group’s continuing asset management business of £153 million (half year 2018: £108 million). The remaining other income consists primarily of policy fee revenue from external customers. (ii) Total revenue from continuing operations excludes the contribution from the discontinued UK and Europe operations which are classified as held for distribution at 30 June 2019 (a line-by-line analysis of revenue for the period for the discontinued UK and Europe operations is included in note D2.1). The half year 2018 comparative results have been re-presented from those previously published accordingly (as described in note A2). |
Acquisition costs and other exp
Acquisition costs and other expenditure from continuing operations | 6 Months Ended |
Jun. 30, 2019 | |
Acquisition costs and other expenditure from continuing operations | |
Acquisition costs and other expenditure from continuing operations | B2 Acquisition costs and other expenditure from continuing operations 2019 £m 2018* £m Half year Half year Acquisition costs incurred for insurance policies (1,630) (1,538) Acquisition costs deferred less amortisation of acquisition costs note(i) 774 (61) Administration costs and other expenditure note(ii) (1,771) (1,625) Movements in amounts attributable to external unit holders of consolidated investment funds (84) (61) Total acquisition costs and other expenditure from continuing operations (2,711) (3,285) * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group’s UK and Europe operations as discontinued operations at 30 June 2019 (as described in note A2). Notes (i) The components of ‘acquisition costs deferred less amortisation of acquisition costs’ of £774 million in half year 2019 are set out in note C5.2. (ii) Included in total administration costs and other expenditure for half year 2019 is depreciation of property, plant and equipment of £(83) million (half year 2018: £(34) million). Out of the £(83) million of depreciation of property, plant and equipment for half year 2019, £(51) million relates to the right-of-use assets recognised under IFRS 16 adopted in 2019 (as described in note A3). |
Effect of changes and other acc
Effect of changes and other accounting matters on insurance assets and liabilities | 6 Months Ended |
Jun. 30, 2019 | |
Effect of changes and other accounting matters on insurance assets and liabilities | |
Effect of changes and other accounting matters on insurance assets and liabilities | B3 Effect of changes and other accounting matters on insurance assets and liabilities The following matters are relevant to the determination of the half year 2019 results: (a) In half year 2019, the adjusted IFRS operating profit based on longer-term investment returns for Asia insurance operations included a net credit of £76 million (half year 2018: £69 million) representing a small number of items that are not expected to reoccur, including the impact of a refinement to the run-off of the allowance for prudence within technical provisions. (b) There has been no material change in assumptions underpinning insurance assets and liabilities since full year 2018. (c) Changes in the allowance for credit risk for annuity business, mortality and other assumptions are discussed in note D2.2 following the classification of the Group’s UK and Europe operations as discontinued at 30 June 2019. |
Tax charge from continuing oper
Tax charge from continuing operations | 6 Months Ended |
Jun. 30, 2019 | |
Tax charge from continuing operations | |
Tax charge from continuing operations | B4 Tax charge from continuing operations B4.1 Total tax charge by nature of expense from continuing operations The total tax charge for continuing operations in the income statement is as follows: 2019 £m 2018* £m Current Deferred Half year Half year Tax charge tax tax Total Total Attributable to shareholders: Asia operations (139) (49) (188) (139) US operations (130) 241 111 (216) Other operations 84 (8) 76 29 Tax (charge) credit attributable to shareholders' returns (185) 184 (1) (326) Attributable to policyholders: Asia operations (54) (166) (220) (43) Total tax (charge) credit (239) 18 (221) (369) * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group’s UK and Europe operations as discontinued operations at 30 June 2019 (as described in note A2). The principal reason for the decrease in the tax charge attributable to shareholders’ returns from continuing operations is the result of the tax credit on US derivative losses largely eliminating the tax charge on Asia profits. B4.2 Shareholder profit and tax charge from continuing operations The shareholder profit, tax charge (credit) and effective tax rate for continuing operations are as follows: Half year 2019 £m Total Asia US Other attributable to operations operations operations shareholders Adjusted IFRS operating profit (loss) based on longer-term investment returns 1,198 1,215 (389) 2,024 Non-operating profit (loss) 627 (1,536) (219) (1,128) Profit (loss) before tax 1,825 (321) (608) 896 Tax charge (credit) on: Adjusted IFRS operating profit (loss) based on longer-term investment returns 168 203 (39) 332 Non-operating profit (loss) 20 (314) (37) (331) Total actual tax charge (credit) 188 (111) (76) 1 Actual tax rate on: Adjusted IFRS operating profit based on longer-term investment returns 14 % 17 % 10 % 16 % Profit before tax 10 % 35 % 13 % 0 % Half year 2018* £m Total Asia US Other attributable to operations operations operations shareholders Adjusted IFRS operating profit (loss) based on longer-term investment returns 1,016 1,002 (349) 1,669 Non-operating (loss) profit (338) 184 84 (70) Profit (loss) before tax 678 1,186 (265) 1,599 Tax charge (credit) on: Adjusted IFRS operating profit (loss) based on longer-term investment returns 151 177 (41) 287 Non-operating (loss) profit (12) 39 12 39 Total actual tax charge (credit) 139 216 (29) 326 Actual tax rate on: Adjusted IFRS operating profit based on longer-term investment returns 15 % 18 % 12 % 17 % Profit before tax 21 % 18 % 11 % 20 % * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group’s UK and Europe operations as discontinued operations (as described in note A2). B4.3 Reconciliation of shareholder effective tax rate from continuing operations In the reconciliation below, the expected tax rates reflect the corporation tax rates that are expected to apply to the taxable profit of the relevant business. Where there are profits of more than one jurisdiction, the expected tax rates reflect the corporation tax rates weighted by reference to the amount of profit contributing to the aggregate business result. 2019 2018 Half year Half year £m % £m % note (i) note (iv) note (iv) Profit before tax 896 — 1,599 — Expected tax rate (ETR) 20 % — 22 % — Tax at the expected rate 179 20.0 % 352 22.0 % Effects of recurring tax reconciliation items and percentage impact on ETR: Income not taxable or taxable at concessionary rates (54) (6.0) % (19) (1.2) % Deductions not allowable for tax purposes 23 2.6 % 25 1.6 % Items related to taxation of life insurance businesses note (ii) (138) (15.4) % (36) (2.3) % Deferred tax adjustments (9) (1.0) % (17) (1.1) % Effect of results of joint ventures and associates (27) (3.0) % (20) (1.3) % Irrecoverable withholding taxes 21 2.3 % 26 1.8 % Other 4 0.4 % — — Total (180) (20.1) % (41) (2.5) % Effects of non-recurring tax reconciliation items and percentage impact on ETR: Adjustments to tax charge in relation to prior years 15 1.7 % 7 0.4 % Movements in provisions for open tax matters note (iii) 6 0.7 % 8 0.5 % Adjustments in relation to business disposals (19) (2.2) % — — Total 2 0.2 % 15 0.9 % Total actual tax charge 1 0.1 % 326 20.4 % Notes (i) The main driver of the Group’s effective tax rate is the relative mix of the profits between jurisdictions with higher tax rates (such as Indonesia and Malaysia), jurisdictions with lower tax rates (such as Hong Kong and Singapore) and jurisdictions with rates in between (such as the UK and the US). At half year 2019, the reduction in the effective tax rate is a result of the loss before tax in US operations. (ii) The £138 million reconciling item related to taxation of life insurance businesses for half year 2019 (half year 2018: £36 million) mainly reflects £82 million in the Hong Kong business in relation to investment gains which are not subject to tax due to the taxable profit being computed as 5 per cent of net insurance premiums. (iii) The statement of financial position contains the following provisions in relation to open tax matters: £m At 31 December 2018 (149) Movements in the current period included in tax charge attributable to shareholders (6) Other movements* (1) At 30 June 2019 (156) * Other movements include interest arising on open tax matters and amounts included in the Group’s share of profits from joint ventures and associates, net of related tax. (iv) The Group’s UK and Europe operations are classified as held for distribution at 30 June 2019. The half year 2018 comparative results have been re-presented from those previously published accordingly (as described in note A2). |
Earnings per share
Earnings per share | 6 Months Ended |
Jun. 30, 2019 | |
Earnings per share | |
Earnings per share | B5 Earnings per share Half year 2019 Net of tax and Basic Diluted Non- controlling non- controlling earnings earnings Before tax Tax interests interests per share per share £m £m £m £m pence pence Note B1.1 B4 Based on adjusted IFRS operating profit based on longer-term investment returns 2,024 (332) (5) 1,687 65.3 p 65.3 p Short-term fluctuations in investment returns on shareholder-backed business B1.2 (1,124) 314 — (810) (31.4) p (31.4) p Amortisation of acquisition accounting adjustments (17) 3 — (14) (0.5) p (0.5) p Gain (loss) on disposal of businesses and corporate transactions 13 14 — 27 1.0 p 1.0 p Based on profit for the period from continuing operations 896 (1) (5) 890 34.4 p 34.4 p Based on profit for the period from discontinued operations D2.1 817 (172) — 645 25.0 p 25.0 p Based on profit for the period 1,713 (173) (5) 1,535 59.4 p 59.4 p Half year 2018* Net of tax and Basic Diluted Non- controlling non- controlling earnings earnings Before tax Tax interests interests per share per share £m £m £m £m pence pence Note B1.1 B4 Based on adjusted IFRS operating profit based on longer-term investment returns 1,669 (287) (1) 1,381 53.7 p 53.6 p Short-term fluctuations in investment returns on shareholder-backed business B1.2 9 (51) — (42) (1.6) p (1.6) p Amortisation of acquisition accounting adjustments (22) 4 — (18) (0.7) p (0.7) p Gain (loss) on disposal of businesses and corporate transactions (57) 8 — (49) (1.9) p (1.9) p Based on profit for the period from continuing operations 1,599 (326) (1) 1,272 49.5 p 49.4 p Based on profit for the period from discontinued operations D2.1 101 (18) — 83 3.2 p 3.2 p Based on profit for the period 1,700 (344) (1) 1,355 52.7 p 52.6 p * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group’s UK and Europe operations as discontinued operations at 30 June 2019 (as described in note A2). Earnings per share are calculated based on earnings attributable to ordinary shareholders, after related tax and non-controlling interests. The weighted average number of shares for calculating earnings per share, which excludes those held in employee share trusts and consolidated unit trusts and OEICs, is set out as below: Weighted average number (in millions) of shares for calculation of: Half year Half year Basic earnings per share 2,583 2,573 Diluted earnings per share 2,584 2,574 |
Dividends
Dividends | 6 Months Ended |
Jun. 30, 2019 | |
Dividends | |
Dividends | B6 Dividends Half year 2019 Half year 2018 Pence per share £m Pence per share £m Dividends relating to reporting period: First interim ordinary dividend 16.45 p 428 15.67 p 406 Dividends paid in reporting period: Second interim ordinary dividend for prior year 33.68 p 870 32.50 p 840 Dividend per share The 2019 first interim dividend of 16.45 pence per ordinary share will be paid on 26 September 2019 in sterling to shareholders in the UK, and in Hong Kong dollars to shareholders on the Hong Kong branch register at 4.30pm Hong Kong time on 26 September 2019. The dividend payable to the HK Shareholders will be translated using the exchange rate quoted by the WM Company at the close of business on 13 August 2019. Holders of US American Depositary Receipts (US Shareholders) will be paid their dividends in US dollars on or about 3 October 2019. The exchange rate at which the dividend payable to the US Shareholders will be translated into US dollars will be determined by the depositary agent. The second interim dividend will be paid on or about 3 October 2019 in Singapore dollars to shareholders with shares standing to the credit of their securities accounts with The Central Depository (Pte) Limited (CDP) at 5.00pm Singapore time on the Record Date (SG Shareholders). The exchange rate at which the dividend payable to the SG Shareholders will be translated from Hong Kong dollars into Singapore dollars, will be determined by CDP. Shareholders on the UK register are eligible to participate in a Dividend Reinvestment Plan. |
Analysis of Group statement of
Analysis of Group statement of financial position by segment | 6 Months Ended |
Jun. 30, 2019 | |
Analysis of Group statement of financial position by segment | |
Analysis of Group statement of financial position by segment | C1 Analysis of Group statement of financial position by segment To explain the assets, liabilities and capital of the Group’s businesses more comprehensively, it is appropriate to provide analyses of the Group’s statement of financial position by operating segment and type of business. 30 Jun 2019 £m 2018 £m Before elimination of intra-group debtors and creditors Elimination of intra- Unallocated Discontinued group to a segment Total UK and debtors 31 Dec (central continuing Europe and Group Group Asia US operations) operations operations creditors Total Total By operating segment Note C2.1 C2.2 note (i) note (v) note (v) Assets Goodwill C5.1 510 — — 510 — — 510 1,857 Deferred acquisition costs and other intangible assets C5.2 3,624 8,990 45 12,659 — — 12,659 11,923 Reinsurers' share of insurance contract liabilities note (ii) 3,621 6,527 3 10,151 — — 10,151 11,144 Other assets note (iii) 4,319 3,908 2,525 10,752 — (3,491) 7,261 11,459 Investment properties 5 6 — 11 — — 11 17,925 Investment in joint ventures and associates accounted for using the equity method 1,030 — — 1,030 — — 1,030 1,733 Financial investments 93,476 203,898 2,155 299,529 — — 299,529 429,901 Assets held for distribution D2.2 — — — — 221,126 (2,802) 218,324 — Assets held for sale — — — — — — — 10,578 Cash and cash equivalents 2,222 1,184 1,802 5,208 — — 5,208 12,125 Total assets 108,807 224,513 6,530 339,850 221,126 (6,293) 554,683 508,645 Total equity 7,656 6,752 (2,993) 11,415 8,280 — 19,695 17,267 Liabilities Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) C4.1(i) 84,077 202,152 47 286,276 — (1,108) 285,168 409,301 Unallocated surplus of with-profits funds C4.1(i) 3,034 — — 3,034 — (90) 2,944 15,845 Core structural borrowings of shareholder-financed businesses C6.1 — 196 7,245 7,441 — — 7,441 7,664 Operational borrowings attributable to shareholder-financed businesses C6.2(i) 137 800 727 1,664 — — 1,664 998 Borrowings attributable to with-profits businesses C6.2(ii) 238 — — 238 — — 238 3,940 Other liabilities note (iv) 13,665 14,613 1,504 29,782 — (3,636) 26,146 43,062 Liabilities held for distribution D2.2 — — — — 212,846 (1,459) 211,387 — Liabilities held for sale — — — — — — — 10,568 Total liabilities 101,151 217,761 9,523 328,435 212,846 (6,293) 534,988 491,378 Total equity and liabilities 108,807 224,513 6,530 339,850 221,126 (6,293) 554,683 508,645 Notes (i) Unallocated to a segment includes central operations, the Group’s existing treasury company, Prudential Capital, and Africa operations as per note B1.3. (ii) Reinsurers’ share of contract liabilities of £10,151 million at 30 June 2019 includes the reinsurance ceded in respect of the acquired REALIC business by the Group’s US insurance operations. In addition to this REALIC reinsurance, the balances in 2018 also included the reinsurance of part of the UK shareholder-backed annuity portfolio. (iii) ‘Other assets’ at 30 June 2019 included property, plant and equipment of £785 million relating to continuing operations (31 December 2018: £1,409 million, of which £378 million related to continuing operations). On 1 January 2019, £414 million of right-of-use assets was recognised for continuing operations upon adoption of IFRS 16 (see note A3). During the period, the Group made additions of £82 million for continuing operations of which £66 million relates to right-of-use assets. Contained within ‘Other assets’ is premiums receivable of £564 million, of which 91 per cent are due within one year (31 December 2018: premiums receivable for total continuing and discontinued operations of £672 million, of which 73 per cent are due within one year. (iv) Within ’Other liabilities’ at 30 June 2019 is accruals, deferred income and other liabilities of £10,597 million for continuing operations (31 December 2018: £15,248 million for continuing and discontinued operations), of which £6,722 million (31 December 2018: £9,968 million) are due within one year. (v) Assets and liabilities held for distribution relate to the Group’s UK and Europe operations classified as discontinued operations at 30 June 2019. A line-by-line analysis of assets and liabilities for the discontinued UK and Europe operations (before elimination of intra-group balances with continuing operations) is included in note D2.2). The 2018 comparative results for the assets and liabilities at 31 December 2018 are as published and not restated (as described in note A2). |
Analysis of segment statement o
Analysis of segment statement of financial position by business type | 6 Months Ended |
Jun. 30, 2019 | |
Analysis of segment statement of financial position by business type | |
Analysis of segment statement of financial position by business type | C2 Analysis of segment statement of financial position by business type To show the statement of financial position by reference to the differing degrees of policyholder and shareholder economic interest of the different types of business, the analysis below is structured to show the assets and liabilities of each segment by business type. C2.1 Asia 30 Jun 2019 £m 2018 £m Total insurance Unit -linked With assets Asset- -profits and Other manage Elimina- 31 Dec Note business* liabilities business Total ment tions Total Total Assets Goodwill — — 252 252 258 — 510 498 Deferred acquisition costs and other intangible assets 58 — 3,554 3,612 12 — 3,624 2,937 Reinsurers' share of insurance contract liabilities 83 — 3,538 3,621 — — 3,621 2,777 Other assets 2,526 315 1,357 4,198 156 (35) 4,319 3,916 Investment properties — — 5 5 — — 5 5 Investment in joint ventures and associates accounted for using the equity method — — 859 859 171 — 1,030 991 Financial investments 54,687 18,492 20,134 93,313 163 — 93,476 80,886 Cash and cash equivalents 534 400 1,179 2,113 109 — 2,222 2,189 Total assets 57,888 19,207 30,878 107,973 869 (35) 108,807 94,199 Total equity — — 7,077 7,077 579 — 7,656 6,428 Liabilities Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) C4.2 48,041 17,594 18,442 84,077 — — 84,077 73,216 Unallocated surplus of with-profits funds C4.2 3,034 — — 3,034 — — 3,034 2,511 Operational borrowings attributable to shareholder-financed businesses — 36 88 124 13 — 137 61 Borrowings attributable to with-profits businesses 238 — — 238 — — 238 19 Other liabilities 6,575 1,577 5,271 13,423 277 (35) 13,665 11,964 Total liabilities 57,888 19,207 23,801 100,896 290 (35) 101,151 87,771 Total equity and liabilities 57,888 19,207 30,878 107,973 869 (35) 108,807 94,199 * The statement of financial position for with-profits business comprises the with-profits assets and liabilities of the Hong Kong, Malaysia and Singapore operations. ‘Other business’ includes assets and liabilities of other participating businesses and other non-linked shareholder-backed business. C2.2 US 30 Jun 2019 £m 2018 £m Total insurance Variable annuity separate Fixed account annuity, assets GICs and Asset and other manage- Elimina- 31 Dec Note liabilities business Total ment tions Total Total Assets Goodwill — — — — — — — Deferred acquisition costs and other intangible assets — 8,990 8,990 — — 8,990 8,747 Reinsurers' share of insurance contract liabilities — 6,527 6,527 — — 6,527 6,662 Other assets — 3,834 3,834 143 (69) 3,908 3,588 Investment properties — 6 6 — — 6 6 Financial investments 145,295 58,585 203,880 18 — 203,898 182,910 Cash and cash equivalents — 1,130 1,130 54 — 1,184 3,005 Total assets 145,295 79,072 224,367 215 (69) 224,513 204,918 Total equity — 6,702 6,702 50 — 6,752 5,624 Liabilities Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) C4.3 145,295 56,857 202,152 — — 202,152 185,600 Core structural borrowings of shareholder-financed businesses — 196 196 — — 196 196 Operational borrowings attributable to shareholder-financed businesses — 767 767 33 — 800 328 Other liabilities — 14,550 14,550 132 (69) 14,613 13,170 Total liabilities 145,295 72,370 217,665 165 (69) 217,761 199,294 Total equity and liabilities 145,295 79,072 224,367 215 (69) 224,513 204,918 |
Group assets and liabilities -
Group assets and liabilities - measurement | 6 Months Ended |
Jun. 30, 2019 | |
Group assets and liabilities - measurement | |
Group assets and liabilities - measurement | C3 Assets and liabilities C3.1 Group assets and liabilities – measurement (a) Determination of fair value The fair values of the financial instruments for which fair valuation is required under IFRS are determined by the use of current market bid prices for exchange-quoted investments, or by using quotations from independent third parties, such as brokers and pricing services or by using appropriate valuation techniques. The estimated fair value of derivative financial instruments reflects the estimated amount the Group would receive or pay in an arm’s length transaction. This amount is determined using quoted prices if exchange listed, quotations from independent third parties or valued internally using standard market practices. Other than the loans which have been designated at fair value through profit or loss, the loans and receivables have been shown net of provisions for impairment. The fair value of loans has been estimated from discounted cash flows expected to be received. The discount rate used is updated for the market rate of interest where applicable. The fair value of investment properties is based on market values as assessed by professionally qualified external valuers or by the Group's qualified surveyors. The fair value of the subordinated and senior debt issued by the parent company is determined using quoted prices from independent third parties. The fair value of financial liabilities (other than derivative financial instruments) is determined using discounted cash flows of the amounts expected to be paid. (b) Fair value measurement hierarchy of Group assets and liabilities Assets and liabilities carried at fair value on the statement of financial position The table below shows the assets and liabilities carried at fair value analysed by level of the IFRS 13 ‘Fair Value Measurement’ defined fair value hierarchy. This hierarchy is based on the inputs to the fair value measurement and reflects the lowest level input that is significant to that measurement. The analysis of the fair value measurement hierarchy of the Group's assets and liabilities at 30 June 2019 below excludes the analysis for the Group's UK and Europe operations which are classified as held for distribution. A separate fair value measurement hierarchy analysis at 30 June 2019 for the UK and Europe is presented in note D2.2. In line with the IFRS requirements, the comparatives have not been re-presented for the assets and liabilities classified for held for distribution in the current period. All assets and liabilities held at fair value are classified as fair value through profit or loss, except for £44,178 million (31 December 2018: £40,849 million) of debt securities in the US operations classified as available-for-sale. All assets and liabilities held at fair value are measured on a recurring basis. As of 30 June 2019, the Group does not have any financial instruments that are measured on a non-recurring basis. Financial instruments at fair value 30 Jun 2019 £m Level 1 Level 2 Level 3 Valuation Valuation Quoted prices based on based on (unadjusted) significant significant Analysis of financial investments, net of derivative liabilities in active observable unobservable by business type from continuing operations markets market inputs market inputs Total With-profits Loans — — — — Equity securities and portfolio holdings in unit trusts 19,318 1,906 153 21,377 Debt securities 28,964 3,093 6 32,063 Other investments (including derivative assets) 107 81 — 188 Derivative liabilities (34) (11) — (45) Total financial investments, net of derivative liabilities 48,355 5,069 159 53,583 Percentage of total (%) 90 % 10 % 0 % 100 % Unit-linked and variable annuity separate account Equity securities and portfolio holdings in unit trusts 159,462 230 — 159,692 Debt securities 2,840 763 — 3,603 Other investments (including derivative assets) — — — — Derivative liabilities (11) (6) — (17) Total financial investments, net of derivative liabilities 162,291 987 — 163,278 Percentage of total (%) 99 % 1 % 0 % 100 % Non-linked shareholder-backed Loans — — 2,799 2,799 Equity securities and portfolio holdings in unit trusts 2,580 4 17 2,601 Debt securities 16,726 47,283 — 64,009 Other investments (including derivative assets) 42 988 962 1,992 Derivative liabilities (7) (513) (455) (975) Total financial investments, net of derivative liabilities 19,341 47,762 3,323 70,426 Percentage of total (%) 27 % 68 % 5 % 100 % Group total analysis, including other financial liabilities held at fair value from continuing operations Loans — — 2,799 2,799 Equity securities and portfolio holdings in unit trusts 181,360 2,140 170 183,670 Debt securities 48,530 51,139 6 99,675 Other investments (including derivative assets) 149 1,069 962 2,180 Derivative liabilities (52) (530) (455) (1,037) Total financial investments, net of derivative liabilities 229,987 53,818 3,482 287,287 Investment contract liabilities without discretionary participation features held at fair value — (666) — (666) Net asset value attributable to unit holders of consolidated unit trusts and similar funds (3,482) — — (3,482) Other financial liabilities held at fair value — (5) (3,081) (3,086) Total financial instruments at fair value 226,505 53,147 401 280,053 Percentage of total (%) 81 % 19 % 0 % 100 % 31 Dec 2018 £m Level 1 Level 2 Level 3 Valuation Valuation Quoted prices based on based on (unadjusted) significant significant Analysis of financial investments, net of derivative in active observable unobservable liabilities by business type markets market inputs market inputs Total With-profits Loans — — 1,703 1,703 Equity securities and portfolio holdings in unit trusts 52,320 5,447 488 58,255 Debt securities 31,210 48,981 811 81,002 Other investments (including derivative assets) 143 3,263 4,325 7,731 Derivative liabilities (85) (1,231) — (1,316) Total financial investments, net of derivative liabilities 83,588 56,460 7,327 147,375 Percentage of total (%) 57 % 38 % 5 % 100 % Unit-linked and variable annuity separate account Equity securities and portfolio holdings in unit trusts 152,987 505 9 153,501 Debt securities 4,766 9,727 — 14,493 Other investments (including derivative assets) 6 3 6 15 Derivative liabilities (2) (3) — (5) Total financial investments, net of derivative liabilities 157,757 10,232 15 168,004 Percentage of total (%) 94 % 6 % 0 % 100 % Non-linked shareholder-backed Loans — — 3,050 3,050 Equity securities and portfolio holdings in unit trusts 2,957 2 18 2,977 Debt securities 17,687 61,803 371 79,861 Other investments (including derivative assets) 61 1,258 941 2,260 Derivative liabilities (2) (1,760) (423) (2,185) Total financial investments, net of derivative liabilities 20,703 61,303 3,957 85,963 Percentage of total (%) 24 % 71 % 5 % 100 % Group total analysis, including other financial liabilities held at fair value Loans — — 4,753 4,753 Equity securities and portfolio holdings in unit trusts 208,264 5,954 515 214,733 Debt securities 53,663 120,511 1,182 175,356 Other investments (including derivative assets) 210 4,524 5,272 10,006 Derivative liabilities (89) (2,994) (423) (3,506) Total financial investments, net of derivative liabilities 262,048 127,995 11,299 401,342 Investment contract liabilities without discretionary participation features held at fair value — (16,054) — (16,054) Borrowings attributable to with-profits businesses — — (1,606) (1,606) Net asset value attributable to unit holders of consolidated unit trusts and similar funds (6,852) (3,811) (988) (11,651) Other financial liabilities held at fair value — (2) (3,404) (3,406) Total financial instruments at fair value 255,196 108,128 5,301 368,625 Percentage of total (%) 70 % 29 % 1 % 100 % Analysed as: Total from continuing operations With-profits 39,191 3,928 159 43,278 Unit-linked and variable annuity separate account 143,556 (64) — 143,492 Non-linked shareholder-backed 16,549 43,948 266 60,763 199,296 47,812 425 247,533 Percentage of total continuing operations (%) 81 % 19 % 0 % 100 % Total from discontinued UK and Europe operations* 55,900 60,316 4,876 121,092 Percentage of total discontinued operations (%) 46 % 50 % 4 % 100 % * Classified as discontinued operations at 30 June 2019 (as described in note A2). Assets and liabilities at amortised cost and their fair value The table below shows the financial assets and liabilities carried at amortised cost on the statement of financial position and their fair value, excluding those held for distribution. Cash deposits, accrued income, other debtors, accruals, deferred income and other liabilities are excluded from the analysis below, as these are carried at amortised cost, which approximates fair value. 2019 £m 2018 £m 30 Jun 31 Dec Carrying Fair Carrying Fair value value value value Assets Loans 9,714 10,010 13,257 13,666 Liabilities Investment contract liabilities without discretionary participation features (3,132) (3,140) (3,168) (3,157) Core structural borrowings of shareholder-financed businesses (7,441) (8,052) (7,664) (7,847) Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses (1,435) (1,435) (998) (998) Borrowings (excluding lease liabilities) attributable to the with-profits funds (25) (24) (2,334) (2,103) Obligations under funding, securities lending and sale and repurchase agreements (6,756) (6,890) (6,989) (7,008) Total financial instruments carried at amortised cost (9,075) (9,531) (7,896) (7,447) Analysed as: Total from continuing operations (7,848) (8,040) Total from discontinued UK and Europe operations* (48) 593 (7,896) (7,447) * Classified as discontinued operations at 30 June 2019 (as described in note A2). (c) Valuation approach for level 2 fair valued assets and liabilities A significant proportion of the Group’s level 2 assets are corporate bonds, structured securities and other non-national government debt securities. These assets, in line with market practice, are generally valued using a designated independent pricing service or quote from third-party brokers. These valuations are subject to a number of monitoring controls, such as comparison to multiple pricing sources where available, monthly price variances, stale price reviews and variance analysis on prices achieved on subsequent trades. For further detail on the valuation approach for level 2 fair valued assets and liabilities please refer to note C3.1 of the Group IFRS financial statements for the year ended 31 December 2018. (d) Fair value measurements for level 3 fair valued assets and liabilities Reconciliation of movements in level 3 assets and liabilities measured at fair value The following table reconciles the value of level 3 fair valued assets and liabilities at 1 January 2019 to that presented at 30 June 2019. Total investment return recorded in the income statement represents interest and dividend income, realised gains and losses, unrealised gains and losses on the assets classified at fair value through profit and loss and foreign exchange movements on an individual entity’s overseas investments. Total gains and losses recorded in other comprehensive income includes unrealised gains and losses on debt securities held as available-for-sale within Jackson and foreign exchange movements arising from the retranslation of the Group’s overseas subsidiaries and branches. Half year 2019 £m Net asset value attributable Equity to unit securities Other Borrowings holders of and investments attributable consolidated portfolio (including to with- unit trusts Other Reconciliation of movements in level 3 assets holdings in Debt derivative Derivative profits and similar financial and liabilities measured at fair value Loans unit trusts securities assets) liabilities businesses funds liabilities Total At 1 January 2019 4,753 515 1,182 5,272 (423) (1,606) (988) (3,404) 5,301 Reclassification to held for distribution (1,970) (345) (1,177) (4,333) — 1,606 988 355 (4,876) Total gains (losses) in income statement: Net realised gains (losses) 91 — 5 (25) — — — (94) (23) Net unrealised gains (losses) on financial instruments held at the end of period — (2) — 40 (15) — — (14) 9 Total gains (losses) recorded in other comprehensive income 4 — 1 (5) (17) — — (11) (28) Purchases — 2 — 127 — — — — 129 Sales — — (5) (114) — — — — (119) Issues 26 — — — — — — (35) (9) Settlements (105) — — — — — — 122 17 At 30 June 2019 2,799 170 6 962 (455) — — (3,081) 401 Full year 2018 £m Net asset value attributable Equity to unit securities Other Borrowings holders of and investments attributable consolidated portfolio (including to with- unit trusts Other Reconciliation of movements in level 3 assets holdings in Debt derivative Derivative profits and similar financial and liabilities measured at fair value Loans unit trusts securities assets) liabilities businesses funds liabilities Total At 1 January 2018 4,837 371 654 4,424 (512) (1,887) (413) (3,031) 4,443 Total gains (losses) in income statement: Net realised gains (losses) (7) — 9 35 — — — (1) 36 Net unrealised gains (losses) on financial instruments held at the end of the year (71) 38 (16) 370 27 (23) 67 6 398 Total gains (losses) recorded in other comprehensive income 162 8 — 54 (1) — 31 (170) 84 Purchases 62 125 666 1,202 — — — — 2,055 Sales (178) (35) (131) (813) — — — — (1,157) Issues 279 — — — — — (697) (481) (899) Settlements (331) — — — — 304 57 273 303 Transfers into level 3 — 8 — — — — — — 8 Transfers out of level 3 — — — — 63 — (33) — 30 At 31 December 2018 4,753 515 1,182 5,272 (423) (1,606) (988) (3,404) 5,301 * Includes distributions to third-party investors by subsidiaries held by the UK with-profits funds for investment purposes. These distributions vary period to period depending on the maturity of the subsidiaries and the gains realised by those entities in the period. Valuation approach for level 3 fair valued assets and liabilities Investments valued using valuation techniques include financial investments which by their nature do not have an externally quoted price based on regular trades, and financial investments for which markets are no longer active as a result of market conditions, eg market illiquidity. The valuation techniques used include comparison to recent arm’s length transactions, reference to other instruments that are substantially the same, discounted cash flow analysis, option-adjusted spread models and, if applicable, enterprise valuation. For further detail on the valuation approach for level 3 fair valued assets and liabilities, please refer to note C3.1 of the Group’s consolidated financial statements for the year ended 31 December 2018. The Group’s valuation policies, procedures and analyses for instruments categorised as level 3 are overseen by Business Unit committees as part of the Group’s wider financial reporting governance processes. The procedures undertaken include approval of valuation methodologies, verification processes, and resolution of significant or complex valuation issues. In undertaking these activities the Group makes use of the extensive expertise of its asset management functions. In addition, the Group has minimum standards for independent price verification to ensure valuation accuracy is regularly independently verified. Adherence to this policy is monitored across the business units. At 30 June 2019, the Group held £401 million of net financial instruments at fair value within level 3. This represents less than 0.5 per cent of the total fair valued financial assets net of financial liabilities of the continuing operations. Included within these net assets and liabilities are policy loans of £2,799 million at 30 June 2019 measured as the loan outstanding balance, plus accrued investment income, attached to acquired REALIC business and held to back the liabilities for funds withheld under reinsurance arrangements. The funds withheld liability of £2,953 million at 30 June 2019 is also classified within level 3. The fair value of the liabilities is equal to the fair value of the underlying assets held as collateral, which primarily consist of policy loans and debt securities. The assets and liabilities broadly offset and therefore their movements have minimal impact on shareholders' profit and equity. Excluding the loans and funds withheld liability under REALIC's reinsurance arrangements as described above, which amounted to a net liability of £154 million, the level 3 fair valued financial assets net of financial liabilities were a net asset of £555 million, which are all externally valued and comprise the following: - Other financial investments of £1,006 million consisting primarily of private equity limited partnerships held by Jackson, which are externally valued in accordance with International Private Equity and Venture Capital Association guidelines using management information available for these investments; and - Offset by net derivative liabilities of £451 million, which are valued externally using the discounted cash flow method in line with standard market practices but are subject to a further independent assessment against external counterparties’ valuations. Of the net asset of £555 million referred to above: - A net asset of £159 million is held by the Group's Asia participating funds and therefore shareholders' profit and equity are not impacted by movements in the valuation of these financial instruments ; and - A net asset of £396 million is held to support non-linked shareholder-backed business. All of these instruments are externally valued and are therefore inherently less subjective than internal valuations. If the value of all these Level 3 financial instruments decreased by 10 per cent, the change in valuation would be £40 million, which would reduce shareholders' equity by this amount before tax. All of this amount would pass through the income statement substantially as part of short-term fluctuations in investment returns outside of adjusted IFRS operating profit based on longer-term investment returns. (e) The Group’s policy is to recognise transfers into and transfers out of levels as of the end of each half year reporting period except for material transfers which are recognised as of the date of the event or change in circumstances that caused the transfer. Transfers are deemed to have occurred when there is a material change in the observed valuation inputs or a change in the level of trading activities of the securities. During half year 2019, the transfers between levels within the Group’s portfolio, excluding those held by the Group’s discontinued UK and Europe operations, were primarily transfers from level 1 to level 2 of £131 million and transfers from level 2 to level 1 of £618 million. These transfers which relate to equity securities and debt securities arose to reflect the change in the observed valuation inputs and in certain cases, the change in the level of trading activities of the securities. |
Debt securities
Debt securities | 6 Months Ended |
Jun. 30, 2019 | |
Debt securities. | |
Debt securities | C3.2 Debt securities This note provides analysis of the Group’s debt securities, including asset-backed securities and sovereign debt securities. With the exception of certain debt securities for US insurance operations classified as ‘available-for-sale’ under IAS 39 as disclosed in notes C3.2 (b) to (d) below, the Group’s debt securities are carried at fair value through profit or loss. The analysis of the Group's debt securities at 30 June 2019 below excludes those of the Group's UK and Europe operations which are classified as held for distribution. In line with IFRS requirements, the comparatives have not been re-presented for the assets and liabilities classified for held for distribution in the current period. An analysis of the credit ratings of the debt securities held by the UK and Europe operations at 30 June 2019 is provided in note D2.2. (a) Credit rating Debt securities are analysed below according to external credit ratings issued, with equivalent ratings issued by different ratings agencies grouped together. Standard & Poor’s ratings have been used where available, if this isn’t the case Moody’s and then Fitch have been used as alternatives. For the US, NAIC ratings have also been used where relevant (as shown in ‘Other’ in the tables below). In the table below, AAA is the highest possible rating. Investment grade financial assets are classified within the range of AAA to BBB- ratings. Financial assets which fall outside this range are classified as below BBB-. 30 Jun 2019 £m Other BBB+ (including AAA AA+ to AA- A+ to A- to BBB- Below BBB- NAIC rated) Total Asia With-profits 3,131 14,977 4,688 4,621 2,016 2,630 32,063 Unit-linked 405 196 458 1,502 378 664 3,603 Non-linked shareholder-backed 1,072 4,155 4,458 3,287 2,493 1,371 16,836 Asset management 12 — 37 — — — 49 US Non-linked shareholder-backed 1,189 7,984 11,527 15,068 1,579 7,917 45,264 Other operations 510 1,144 129 20 50 7 1,860 Total debt securities 6,319 28,456 21,297 24,498 6,516 12,589 99,675 31 Dec 2018 £m Other BBB+ (including AAA AA+ to AA- A+ to A- to BBB- Below BBB- NAIC rated) Total Asia With-profits 2,873 12,379 4,142 3,760 1,747 2,303 27,204 Unit-linked 817 100 492 1,431 426 715 3,981 Non-linked shareholder-backed 1,034 3,552 3,717 2,934 2,202 1,144 14,583 Asset management 11 — 60 — — — 71 US Non-linked shareholder-backed 678 7,383 10,286 14,657 1,429 7,161 41,594 Other operations 619 1,089 151 41 49 18 1,967 Total continuing operations 6,032 24,503 18,848 22,823 5,853 11,341 89,400 Total discontinued UK and Europe operations* 10,938 18,204 18,645 19,728 3,444 14,997 85,956 Total debt securities 16,970 42,707 37,493 42,551 9,297 26,338 175,356 * Classified as discontinued operations at 30 June 2019 (as described in note A2). Securities for continuing operations with credit ratings classified as ‘Other’ can be further analysed as follows. Refer to note D2.2 for details on securities with ratings classified as ‘Other’ for discontinued operations. 2019 £m 2018 £m Asia 30 Jun 31 Dec Government bonds 37 36 Corporate bonds - rated as investment grade by local external ratings agencies 1,215 978 Other 119 130 Total Asia non-linked shareholder-backed other debt securities 1,371 1,144 2019 £m 2018 £m Mortgage -backed Other US securities securities 30 Jun 31 Dec Implicit ratings of other US debt securities based on NAIC* valuations (see below) NAIC 1 2,184 3,337 5,521 5,006 NAIC 2 — 2,357 2,357 2,118 NAIC 3-6 3 36 39 37 Total US other debt securities † 2,187 5,730 7,917 7,161 * The Securities Valuation Office of the NAIC classifies debt securities into six quality categories ranging from Class 1 (the highest) to Class 6 (the lowest). Performing securities are designated as Classes 1 to 5 and securities in or near default are designated Class 6. † Mortgage-backed securities totalling £2,003 million at 30 June 2019 have credit ratings issued by Standard & Poor’s of BBB- or above and hence are designated as investment grade. Other securities totalling £5,694 million at 30 June 2019 with NAIC ratings 1 or 2 are also designated as investment grade. The credit ratings, information or data contained in this report which are attributed and specifically provided by S&P, Moody’s and Fitch Solutions and their respective affiliates and suppliers (‘Content Providers’) is referred to here as the ‘Content’. Reproduction of any Content in any form is prohibited except with the prior written permission of the relevant party. The Content Providers do not guarantee the accuracy, adequacy, completeness, timeliness or availability of any Content and are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, or for the results obtained from the use of such Content. The Content Providers expressly disclaim liability for any damages, costs, expenses, legal fees, or losses (including lost income or lost profit and opportunity costs) in connection with any use of the Content. A reference to a particular investment or security, a rating or any observation concerning an investment that is part of the Content is not a recommendation to buy, sell or hold any such investment or security, nor does it address the suitability an investment or security and should not be relied on as investment advice. (b) Additional analysis of US insurance operations debt securities 2019 £m 2018 £m 30 Jun 31 Dec Corporate and government security and commercial loans: Government 6,094 5,465 Publicly traded and SEC Rule 144A securities* 27,419 26,196 Non-SEC Rule 144A securities 7,293 6,329 Asset backed securities (see note (e)) 4,458 3,604 Total US debt securities † 45,264 41,594 * A 1990 SEC rule that facilitates the resale of privately placed securities under Rule 144A that are without SEC registration to qualified institutional investors. The rule was designed to develop a more liquid and efficient institutional resale market for unregistered securities. † Debt securities for US operations included in the statement of financial position comprise: 2019 £m 2018 £m 30 Jun 31 Dec Available-for-sale 44,178 40,849 Fair value through profit and loss 1,086 745 45,264 41,594 Realised gains and losses, including impairments, recorded in the income statement are as shown in note B1.2 of this report. (c) Movements in unrealised gains and losses on Jackson available-for-sale securities The movement in the statement of financial position value for debt securities classified as available-for-sale from a net unrealised loss of £414 million to a net unrealised gain of £2,247 million as analysed in the table below. Foreign Changes in exchange unrealised 30 Jun 2019 £m translation † appreciation 31 Dec 2018 £m Reflected as part of movement in other Assets fair valued at below book value Book value* 2,339 25,330 Unrealised gain (loss) (49) 14 862 (925) Fair value (as included in statement of financial position) 2,290 24,405 Assets fair valued at or above book value Book value* 39,592 15,933 Unrealised gain (loss) 2,296 30 1,755 511 Fair value (as included in statement of financial position) 41,888 16,444 Total Book value* 41,931 41,263 Net unrealised gain (loss) 2,247 44 2,617 (414) Fair value (as included in the footnote above in the overview table and the statement of financial position) 44,178 40,849 * Book value represents cost/amortised cost of the debt securities. † Translated at the average rate of US$1.2939: £1.00. (d) US debt securities classified as available-for-sale in an unrealised loss position (i) Fair value of securities as a percentage of book value The following table shows the fair value of the debt securities in a gross unrealised loss position for various percentages of book value: 30 Jun 2019 £m 31 Dec 2018 £m Fair Unrealised Fair Unrealised Between 90% and 100% 2,221 (32) 23,662 (809) Between 80% and 90% 38 (5) 707 (104) Below 80% 31 (12) 36 (12) Total 2,290 (49) 24,405 (925) (ii) Unrealised losses by maturity of security 2019 £m 2018 £m 30 Jun 31 Dec 1 year to 5 years (2) (72) 5 years to 10 years (10) (436) More than 10 years (19) (372) Mortgage-backed and other debt securities (18) (45) Total (49) (925) (iii) Age analysis of unrealised losses for the periods indicated The following table shows the age analysis of all the unrealised losses in the portfolio by reference to the length of time the securities have been in an unrealised loss position: 30 Jun 2019 £m 31 Dec 2018 £m Non- Non- investment Investment investment Investment Age analysis grade grade * Total grade grade * Total Less than 6 months (1) (4) (5) (20) (141) (161) 6 months to 1 year (1) (13) (14) (22) (440) (462) 1 year to 2 years (1) (9) (10) (10) (142) (152) 2 years to 3 years — (10) (10) — (123) (123) More than 3 years — (10) (10) (2) (25) (27) (3) (46) (49) (54) (871) (925) * For Standard and Poor, Moody’s and Fitch rated debt securities, those with ratings range from AAA to BBB- are designated as investment grade. For NAIC rated debt securities, those with ratings 1 or 2 are designated as investment grade. Further, the following table shows the age analysis of the securities whose fair values were below 80 per cent of the book value: 30 Jun 2019 £m 31 Dec 2018 £m Fair Unrealised Fair Unrealised Age analysis value loss value loss Less than 3 months 26 (10) 32 (10) 3 months to 6 months 5 (2) 2 (1) More than 6 months — — 2 (1) 31 (12) 36 (12) (e) Asset-backed securities The Group’s holdings in asset-backed securities (ABS), which comprise residential mortgage-backed securities (RMBS), commercial mortgage-backed securities (CMBS), collateralised debt obligations (CDO) funds and other asset-backed securities, at 30 June 2019 are as follows: 2019 £m 2018 £m 30 Jun 31 Dec Asia operations: note (i) Shareholder-backed business 126 121 With-profits business 256 235 US operations note (ii) 4,458 3,604 Other operations note (iii) 315 445 Total for continuing operations 5,155 4,405 Total for discontinued UK and Europe operations* 6,676 Group total 11,081 * Classified as discontinued operations at 30 June 2019 (as described in note A2). Notes (i) The Asia operations' exposure to asset-backed securities for the shareholder-backed business and with-profits business at 30 June 2019, is 100 per cent (31 December 2018: 99.8 per cent) investment grade. (ii) US operations’ exposure to asset-backed securities comprises: 2019 £m 2018 £m 30 Jun 31 Dec RMBS Sub-prime (30 Jun 2019: 2% AAA, 5% AA, 2% A) 88 96 Alt-A (30 Jun 2019: 17% AAA, 34% A) 101 105 Prime including agency (2019: 39% AAA, 45 % AA, 7% A) 579 441 CMBS (30 Jun 2019: 78% AAA, 16% AA, 3% A) 2,266 1,945 CDO funds (30 Jun 2019: 37% AAA, 33% AA, 30% A), including £nil exposure to sub-prime 353 13 Other ABS (30 Jun 2019: 15% AAA, 16% AA, 52% A), including £59 million exposure to sub-prime 1,071 1,004 Total (30 Jun 2019: 52% AAA, 21% AA, 18% A) 4,458 3,604 (iii) Other operations’ exposure to asset-backed securities is held by Prudential Capital with no sub-prime exposure. Of the £315 million held at 30 June 2019, 100 per cent (31 December 2018: 99 per cent) are graded AAA. (f) Group sovereign debt and bank debt exposure The Group exposures held by the shareholder-backed business and with-profits funds in sovereign debts and bank debt securities at 30 June 2019 are analysed as follows: Exposure to sovereign debts 30 Jun 2019 £m 31 Dec 2018 £m Shareholder- With- Shareholder- With- backed profits backed profits business funds business funds Total Eurozone — — 378 440 United Kingdom 988 — 3,226 3,013 United States* 6,410 12,925 5,647 11,858 Indonesia 295 — 282 — Singapore 132 1,719 164 1,658 Thailand 1,106 — 921 — Vietnam 1,186 — 1,871 — Other Asia 1,925 944 1,779 866 Other 98 25 125 221 Total 12,140 15,613 14,393 18,056 Analysed as: Total from continuing operations 11,658 13,144 Total from discontinued UK and Europe operations † 2,735 4,912 14,393 18,056 * The exposure to the United States sovereign debt comprises holdings of the US and Asia insurance operations. † Classified as discontinued operations at 30 June 2019 (as described in note A2). Exposure to bank debt securities 30 Jun 2019 £m 2018 £m Senior debt Subordinated debt 31 Dec Shareholder-backed business Total Tier 1 Tier 2 Total Group total Group total Spain 70 — — — 70 106 France 142 — 9 9 151 156 Germany 30 — 12 12 42 125 Netherlands 56 — 3 3 59 73 Other Eurozone — — — — — 17 Total Eurozone 298 — 24 24 322 477 United Kingdom 598 8 95 103 701 1,346 United States 2,354 1 31 32 2,386 2,667 Asia 248 114 312 426 674 592 Other 470 — 75 75 545 645 Total 3,968 123 537 660 4,628 5,727 Analysed as: Total from continuing operations 4,640 Total from discontinued UK and Europe operations* 1,087 5,727 With-profits funds Italy — — — — — 38 Spain 2 — — — 2 17 France 7 — 27 27 34 352 Germany — — 47 47 47 229 Netherlands 8 — 10 10 18 266 Other Eurozone — — — — — 74 Total Eurozone 17 — 84 84 101 976 United Kingdom 31 2 82 84 115 2,194 United States 16 1 3 4 20 2,730 Asia 279 363 299 662 941 1,015 Other 59 — 142 142 201 1,810 Total 402 366 610 976 1,378 8,725 Analysed as: Total from continuing operations 1,287 Total from discontinued UK and Europe operations* 7,438 8,725 * Classified as discontinued operations at 30 June 2019 (as described in note A2). The tables above exclude assets held to cover linked liabilities and those of the consolidated unit trusts and similar funds. In addition, the tables above exclude the proportionate share of sovereign debt holdings of the Group’s joint venture operations. |
Loans portfolio
Loans portfolio | 6 Months Ended |
Jun. 30, 2019 | |
Loans portfolio | |
Loans portfolio | C3.3 Loans portfolio (a) Overview of loans portfolio Loans are principally accounted for at amortised cost, net of impairment except for certain policy loans of the US insurance operations that are held to back liabilities for funds withheld under reinsurance arrangements and are also accounted on a fair value basis. The analysis of the Group's loan portfolio at 30 June 2019 below excludes those of the Group's UK and Europe operations which are classified as held for distribution. An analysis of the loan portfolio held by the UK and Europe operations at 30 June 2019 is provided in note D2.2. In line with IFRS requirements, the comparatives have not been re-presented for the assets and liabilities classified for held for distribution in the current period. The amounts included in the statement of financial position are analysed as follows: 30 Jun 2019 £m 31 Dec 2018 £m Mortgage loans Policy loans Other loans Total Mortgage loans Policy loans Other loans Total note (i) note (ii) note (i) note (ii) Asia With-profits — 783 63 846 — 727 65 792 Non-linked shareholder-backed 140 233 15 388 156 226 203 585 US Non-linked shareholder-backed 7,587 3,686 — 11,273 7,385 3,681 — 11,066 Other operations — — 6 6 — — — — Total continuing operations 7,727 4,702 84 12,513 7,541 4,634 268 12,443 Total discontinued UK and Europe operations note (iii) 4,116 3 1,448 5,567 Total loans securities 11,657 4,637 1,716 18,010 Notes (i) All mortgage loans are secured by properties. (ii) In the US, £2,799 million of policy loans held at 30 June 2019 (31 December 2018: £2,783 million) are backing liabilities for funds withheld under reinsurance arrangements and are accounted for at fair value through profit or loss. All other policy loans are accounted for at amortised cost, less any impairment. (iii) The amounts held by the UK and Europe operations were transferred to assets held for distribution at 30 June 2019 (see note D2.2). (b) Additional information on US mortgage loans In the US, mortgage loans are all commercial mortgage loans that are secured by the following property types: industrial, multi-family residential, suburban office, retail or hotel. The average loan size is £14.7 million (31 December 2018: £14.0 million). The portfolio has a current estimated average loan to value of 53 per cent (31 December 2018: 53 per cent). Jackson had no mortgage loans where the contractual terms of the agreements had been restructured for all periods shown. |
Policyholder liabilities and un
Policyholder liabilities and unallocated surplus | 6 Months Ended |
Jun. 30, 2019 | |
Policyholder liabilities and unallocated surplus | |
Policyholder liabilities and unallocated surplus | C4 Policyholder liabilities and unallocated surplus The note provides information of policyholder liabilities and unallocated surplus of with-profits funds held on the Group’s statement of financial position. The analysis below excludes the movement for UK and Europe operations which are classified as held for distribution as at 30 June 2019. The balances of the discontinued UK and Europe operations are removed from the opening balance. An analysis of the movement in policyholder liabilities and unallocated surplus of with-profits funds held by the UK and Europe operations at 30 June 2019 is provided in note D2.2. C4.1 Group overview (i) Analysis of movements in policyholder liabilities and unallocated surplus of with-profits funds Half year 2019 £m UK and Asia US Europe Total note C4.2 note C4.3 note D2.2 At 1 January 2019 82,763 185,600 164,889 433,252 Comprising: - Policyholder liabilities on the consolidated statement of financial position (excludes £39 million classified as unallocated to a segment) note (a) 72,107 185,600 151,555 409,262 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 2,511 — 13,334 15,845 - Group's share of policyholder liabilities of joint ventures and associate note(b) 8,145 — — 8,145 Reclassification of UK and Europe liabilities as held for distribution — — (164,889) (164,889) Net flows: Premiums 7,574 7,060 — 14,634 Surrenders (1,531) (6,398) — (7,929) Maturities/deaths (989) (1,348) — (2,337) Net flows 5,054 (686) — 4,368 Shareholders' transfers post tax (38) — — (38) Investment-related items and other movements 6,142 16,838 — 22,980 Foreign exchange translation differences 676 400 — 1,076 At 30 June 2019 94,597 202,152 — 296,749 Comprising: - Policyholder liabilities on the consolidated statement of financial position 82,969 202,152 — 285,121 (excludes £47 million classified as unallocated to a segment) note (a) - Unallocated surplus of with-profits funds on the consolidated statement of financial position 2,944 — — 2,944 - Group's share of policyholder liabilities of joint ventures and associate note (b) 8,684 — — 8,684 Half year 2018 £m UK and Asia US Europe Total note C4.2 note C4.3 note D2.2 At 1 January 2018 73,839 180,724 181,066 435,629 Comprising: - Policyholder liabilities on the consolidated statement of financial position (excludes £32 million classified as unallocated to a segment) 62,898 180,724 167,589 411,211 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 3,474 — 13,477 16,951 - Group's share of policyholder liabilities of joint ventures and associate note (b) 7,467 — — 7,467 Reclassification of reinsured UK annuity contracts as held for sale — — (12,002) (12,002) Net flows: Premiums 6,247 7,111 6,964 20,322 Surrenders (1,547) (5,953) (3,446) (10,946) Maturities/deaths (838) (1,076) (3,499) (5,413) Net flows 3,862 82 19 3,963 Shareholders' transfers post tax (27) — (127) (154) Investment-related items and other movements (1,349) (103) (801) (2,253) Foreign exchange translation differences 690 4,447 17 5,154 At 30 June 2018 77,015 185,150 168,172 430,337 Comprising: - Policyholder liabilities on the consolidated statement of financial position 65,640 185,150 154,655 405,445 (excludes £37 million classified as unallocated to a segment) note (a) - Unallocated surplus of with-profits funds on the consolidated statement of financial position 3,766 — 13,517 17,283 - Group's share of policyholder liabilities of joint ventures and associate note (b) 7,609 — — 7,609 Average policyholder liability balances note (c) Half year 2019 85,953 193,876 — 279,829 Half year 2018 71,807 182,937 161,122 415,866 Notes (a) The policyholder liabilities of the Asia insurance operations at 30 June 2019 of £82,969 million (30 June 2018: £65,640 million) are after deducting the intra-group reinsurance liabilities ceded by the UK and Europe insurance operations of £1,108 million (30 June 2018: £1,181 million) to the Hong Kong with-profits business. Including this amount, total Asia policyholder liabilities are £84,077 million (30 June 2018: £66,821 million). (b) The Group’s investment in joint ventures and associate are accounted for on an equity method basis in the Group’s statement of financial position. The Group’s share of the policyholder liabilities as shown above relates to life businesses in China, India and of the Takaful business in Malaysia. (c) Averages have been based on opening and closing balances, adjusted for acquisitions, disposals and corporate transactions arising in the period, and exclude unallocated surplus of with-profits funds. The items above represent the amount attributable to changes in policyholder liabilities and unallocated surplus of with-profits funds as a result of each of the components listed. The policyholder liabilities shown include investment contracts without discretionary participation features (as defined in IFRS 4) and their full movement in the period but exclude liabilities that have not been allocated to a reporting segment. The items above are shown gross of external reinsurance. The analysis includes the impact of premiums, claims and investment movements on policyholders’ liabilities. The impact does not represent premiums, claims and investment movements as reported in the income statement. For example, the premiums shown above will exclude any deductions for fees/charges. Claims (surrenders, maturities and deaths) represent the policyholder liabilities provision released rather than the claim amount paid to the policyholder. (ii) Analysis of movements in policyholder liabilities for shareholder-backed business Half year 2019 £m UK and Asia US Europe Total At 1 January 2019 40,597 185,600 40,760 266,957 Reclassification of UK and Europe liabilities as held for distribution — — (40,760) (40,760) Net flows: Premiums 3,923 7,060 — 10,983 Surrenders (1,324) (6,398) — (7,722) Maturities/deaths (439) (1,348) — (1,787) Net flows note 2,160 (686) — 1,474 Investment-related items and other movements 1,623 16,838 — 18,461 Foreign exchange translation differences 340 400 — 740 At 30 June 2019 44,720 202,152 — 246,872 Comprising: - Policyholder liabilities on the consolidated statement of financial position 36,036 202,152 — 238,188 (excludes £47 million classified as unallocated to a segment) - Group's share of policyholder liabilities relating to joint ventures and associate 8,684 — — 8,684 Half year 2018 £m UK and Asia US Europe Total At 1 January 2018 37,402 180,724 56,367 274,493 Reclassification of reinsured UK annuity contracts as held for sale — — (12,002) (12,002) Net flows: Premiums 3,266 7,111 681 11,058 Surrenders (1,383) (5,953) (1,200) (8,536) Maturities/deaths (420) (1,076) (1,294) (2,790) Net flows note 1,463 82 (1,813) (268) Investment-related items and other movements (718) (103) (236) (1,057) Foreign exchange translation differences 1 4,447 — 4,448 At 30 June 2018 38,148 185,150 42,316 265,614 Comprising: - Policyholder liabilities on the consolidated statement of financial position 30,539 185,150 42,316 258,005 (excludes £37 million classified as unallocated to a segment) - Group's share of policyholder liabilities relating to joint ventures and associate 7,609 — — 7,609 Note Including net flows of the Group’s insurance joint ventures and associate. (iii) Further analysis of the movement in the period of the Group’s gross contract liabilities, reinsurer's share of insurance contract liabilities and unallocated surplus of with-profits funds (excluding those held by joint ventures and associate) is provided below: Reinsurer's share of insurance Unallocated surplus Contract liabilities contract liabilities of with-profits funds £m £m £m At 1 January 2019 409,301 (11,144) 15,845 Removal of opening balances relating to the discontinued UK and Europe insurance operations note (a) (151,555) 1,703 (13,334) Income and expense included in the income statement 26,274 (680) 506 Other movements note (b) 41 — (90) Foreign exchange translation differences 1,107 (30) 17 At 30 June 2019 285,168 (10,151) 2,944 Notes (a) The balances of the discontinued UK and Europe operations are removed from the opening balances to show the underlying movement from continuing operations (as described in note A2). The £1,703 million of reinsurer’s share of insurance contract liabilities in the table above excluded the intra-group reinsurance assets of £1,109 million for the with-profits business ceded to the Asia insurance operations, which were eliminated on consolidation at 1 January 2019. An analysis of the movement in policyholder liabilities and unallocated surplus of with-profits funds held by the UK and Europe operations at 30 June 2019 is provided in note D2.2. (b) Other movements include premiums received and claims paid on investment contracts without discretionary participating features, which are taken directly to the statement of financial position in accordance with IAS 39. The total charge for benefit and claims shown in the income statement from continuing operations comprises the amounts shown as ‘income and expense included in the income statement’ in the table above together with claims paid of £11,037 million in the period net of amounts attributable to reinsurers of £(466) million. C4.2 Asia insurance operations Half year 2019 £m With-profits Unit-linked Other business liabilities business Total At 1 January 2019 42,166 20,182 20,415 82,763 Comprising: - Policyholder liabilities on the consolidated statement of financial position note (v) 39,655 16,368 16,084 72,107 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 2,511 — — 2,511 - Group's share of policyholder liabilities relating to joint ventures and associate note (i) — 3,814 4,331 8,145 Premiums: New business 594 775 912 2,281 In-force 3,057 932 1,304 5,293 3,651 1,707 2,216 7,574 Surrenders note (ii) (207) (1,070) (254) (1,531) Maturities/deaths (550) (69) (370) (989) Net flows 2,894 568 1,592 5,054 Shareholders' transfers post tax (38) — — (38) Investment-related items and other movements note (iii) 4,519 582 1,041 6,142 Foreign exchange translation differences note (iv) 336 172 168 676 At 30 June 2019 49,877 21,504 23,216 94,597 Comprising: - Policyholder liabilities on the consolidated statement of financial position note (v) 46,933 17,594 18,442 82,969 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 2,944 — — 2,944 - Group's share of policyholder liabilities relating to joint ventures and associate note (i) — 3,910 4,774 8,684 Half year 2018 £m With-profits Unit-linked Other business liabilities business Total At 1 January 2018 36,437 20,027 17,375 73,839 Comprising: - Policyholder liabilities on the consolidated statement of financial position 32,963 16,263 13,672 62,898 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 3,474 — — 3,474 - Group's share of policyholder liabilities relating to joint ventures and associate note (i) — 3,764 3,703 7,467 Premiums: New business 432 870 435 1,737 In-force 2,549 841 1,120 4,510 2,981 1,711 1,555 6,247 Surrenders note (ii) (164) (1,071) (312) (1,547) Maturities/deaths (418) (93) (327) (838) Net flows 2,399 547 916 3,862 Shareholders' transfers post tax (27) — — (27) Investment-related items and other movements note (iii) (631) (652) (66) (1,349) Foreign exchange translation differences note (iv) 689 (142) 143 690 At 30 June 2018 38,867 19,780 18,368 77,015 Comprising: - Policyholder liabilities on the consolidated statement of financial position note (v) 35,101 16,094 14,445 65,640 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 3,766 — — 3,766 - Group's share of policyholder liabilities relating to joint ventures and associate note (i) — 3,686 3,923 7,609 Average policyholder liability balances note (vi) Half year 2019 43,294 20,843 21,816 85,953 Half year 2018 34,032 19,903 17,872 71,807 Notes (i) The Group’s investment in joint ventures and associate are accounted for on an equity method and the Group’s share of the policyholder liabilities as shown above relate to the life business in China, India and of the Takaful business in Malaysia. (ii) The rate of surrenders for shareholder-backed business (expressed as a percentage of opening liabilities) was 3.3 per cent in the first half of 2019 (half year 2018: 3.7 per cent). (iii) Investment-related items and other movements in the first half of 2019 primarily represent equity market gains from the with-profits business and falls in bond yields during the period in a number of business units. (iv) Movements in the period have been translated at the average exchange rates for the period ended 30 June 2019. The closing balance has been translated at the closing spot rates as at 30 June 2019. Differences upon retranslation are included in foreign exchange translation differences. (v) The policyholder liabilities at 30 June 2019 is after deducting the intra-group reinsurance liabilities ceded by the UK and Europe insurance operations of £1,108 million (30 June 2018: £1,181 million) for the with-profits business.Including this amount the Asia total policyholder liabilities are £84,077 million (30 June 2018: £66,821 million). (vi) Averages have been based on opening and closing balances, adjusted for any acquisitions, disposals and corporate transactions arising in the period, and exclude unallocated surplus of with-profits funds. C4.3 US insurance operations Half year 2019 £m Variable annuity Fixed annuity, separate account GICs and other liabilities business Total At 1 January 2019 128,220 57,380 185,600 Premiums 4,661 2,399 7,060 Surrenders (4,643) (1,755) (6,398) Maturities/deaths (604) (744) (1,348) Net flows note (ii) (586) (100) (686) Transfers from general to separate account 492 (492) — Investment-related items and other movements note (iii) 16,800 38 16,838 Foreign exchange translation differences note (i) 369 31 400 At 30 June 2019 145,295 56,857 202,152 Half year 2018 £m Variable annuity Fixed annuity, separate account GICs and other liabilities business Total At 1 January 2018 130,528 50,196 180,724 Premiums 5,528 1,583 7,111 Surrenders (4,225) (1,728) (5,953) Maturities/deaths (540) (536) (1,076) Net flows note (ii) 763 (681) 82 Transfers from general to separate account 387 (387) — Investment-related items and other movements 582 (685) (103) Foreign exchange translation differences note (i) 3,286 1,161 4,447 At 30 June 2018 135,546 49,604 185,150 Average policyholder liability balances note (iv) Half year 2019 136,757 57,119 193,876 Half year 2018 133,037 49,900 182,937 Notes (i) Movements in the period have been translated at an average rate of US$1.29: £1.00 (30 June 2018: US$1.38: £1.00). The closing balances have been translated at closing rate of US$1.27: £1.00 (31 December 2018: US$1.27: £1.00). Differences upon retranslation are included in foreign exchange translation differences. (ii) Net outflows in the first half of 2019 were £686 million (first half of 2018 inflows: £82 million) with net outflows from the variable annuity business following lower sales in the period offset by higher sales of other business in line with the intention to diversify the US product mix. The net outflow for other business in half year 2019 included annuity payments relating to the John Hancock business which was acquired in the fourth quarter of 2018. (iii) Positive investment-related items and other movements in variable annuity separate account liabilities of £16,800 million for the first half of 2019 represent positive separate account return mainly following the increase in the US equity market in the period. (iv) Averages have been based on opening and closing balances . |
Intangible assets
Intangible assets | 6 Months Ended |
Jun. 30, 2019 | |
Intangible assets | |
Intangible assets | C5 Intangible assets The analysis of intangible assets below excludes the UK and Europe operations which are classified as held for distribution as at 30 June 2019. In line with IFRS requirements, the comparatives have not been re-presented. For the analysis of movements during the period, the balances of the discontinued UK and Europe operations are removed from the opening balance. C5.1 Goodwill Goodwill shown on the statement of financial position at 30 June 2019 is wholly attributable to shareholders and represents amounts allocated to entities in Asia in respect of both acquired asset management and life businesses. 2019 £m 2018 £m 30 Jun 31 Dec Carrying value at beginning of period 1,857 1,482 Reclassification to held for distribution note D2.2 (1,359) — Additions in the period — 376 Disposals/reclassifications to held for sale — (10) Exchange differences 12 9 Carrying value at end of period 510 1,857 C5.2 Deferred acquisition costs and other intangible assets 2019 £m 2018 £m 30 Jun 31 Dec Deferred acquisition costs and other intangible assets attributable to shareholders: From continuing operations 12,601 11,672 From discontinued operations* — 112 Total 12,601 11,784 Other intangible assets, including computer software, attributable to with-profits funds: From continuing operations 58 56 From discontinued operations* — 83 Total 58 139 Total of deferred acquisition costs and other intangible assets 12,659 11,923 * Classified as discontinued operations at 30 June 2019 (as described in note A2). The deferred acquisition costs and other intangible assets attributable to shareholders comprise: 2019 £m 2018 £m 30 Jun 31 Dec Deferred acquisition costs related to insurance contracts as classified under IFRS 4 10,326 10,017 Deferred acquisition costs related to investment management contracts, including life assurance contracts classified as financial instruments and investment management contracts under IFRS 4 27 78 Deferred acquisition costs related to insurance and investment contracts 10,353 10,095 Present value of acquired in-force policies for insurance contracts as classified under IFRS 4 (PVIF) 31 34 Distribution rights and other intangibles 2,217 1,655 Present value of acquired in-force (PVIF) and other intangibles attributable to shareholders 2,248 1,689 Total of deferred acquisition costs and other intangible assets note (a) 12,601 11,784 Notes (a) Total deferred acquisition costs and other intangible assets can be further analysed by business operations as follows: 2019 £m 2018 £m Deferred acquisition costs UK and Asia US Europe All asset PVIF and other 30 Jun 31 Dec insurance insurance* insurance management intangibles† Total Total Balance at 1 January: 1,264 8,727 86 18 1,689 11,784 10,866 Reclassification to held for distribution — — (86) (18) (8) (112) — Additions‡ 198 285 — — 652 1,135 1,248 Amortisation to the income statement: note (c) Adjusted IFRS operating profit based on longer-term investment returns (91) (94) — — (102) (287) (1,024) Non-operating profit — 476 — — — 476 (118) (91) 382 — — (102) 189 (1,142) Disposals and transfers — — — — (5) (5) (14) Exchange differences and other movements 12 8 — — 22 42 580 Amortisation of DAC related to net unrealised valuation movements on the US insurance operation's available-for-sale securities recognised within other comprehensive income — (432) — — — (432) 246 Balance at 30 June 1,383 8,970 — — 2,248 12,601 11,784 * Under the Group’s application of IFRS 4, US GAAP is used for measuring the insurance assets and liabilities of its US and certain Asia operations. Under US GAAP, most of the US insurance operation’s products are accounted for under Accounting Standard no. 97 of the Financial Accounting Standards Board (FAS 97) whereby deferred acquisition costs are amortised in line with the emergence of actual and expected gross profits which are determined using an assumption for long-term investment returns for the separate account of 7.4 per cent (full year 2018: 7.4 per cent) (gross of asset management fees and other charges to policyholders, but net of external fund management fees). The amounts included in the income statement and other comprehensive income affect the pattern of profit emergence and thus the DAC amortisation attaching. DAC amortisation is allocated to the operating and non-operating components of the Group’s supplementary analysis of profit and other comprehensive income by reference to the underlying items. † PVIF and other intangibles comprise PVIF, distribution rights and other intangibles such as software rights. Distribution rights relate to amounts that have been paid or have become unconditionally due for payment as a result of past events in respect of bancassurance partnership arrangements in Asia. These agreements allow for bank distribution of Prudential’s insurance products for a fixed period of time. Software rights include amounts reclassified as held for distribution of negative £6 million, additions of £16 million, amortisation of £15 million, disposals of £2 million and a balance at 30 June 2019 of £55 million. ‡ In January 2019, the Group renewed its regional strategic bancassurance alliance with United Overseas Bank Limited (UOB). The new agreement extends the original alliance, which commenced in 2010, to 2034 and increases the geographical scope to include a fifth market, Vietnam, alongside the existing markets of Singapore, Malaysia, Thailand and Indonesia. As part of this transaction, Prudential has agreed to pay UOB an initial fee of £662 million (translated using a Singapore dollar: £ foreign exchange rate of 1.7360) for distribution rights which are not dependent on future sales volumes. This amount is paid in three instalments of £230 million in February 2019, £331 million in January 2020 and £101 million in January 2021. After allowing for discounting, the amount included in additions in the table above is £630 million. (b) The DAC amount in respect of US insurance operations comprises amounts in respect of: 2019 £m 2018 £m 30 Jun 31 Dec Variable annuity business 9,118 8,477 Other business 341 299 Cumulative shadow DAC (for unrealised gains/losses booked in other comprehensive income)* (489) (49) Total DAC for US operations 8,970 8,727 * A loss of £(432) million (31 December 2018: a gain of £246 million) for shadow DAC amortisation is booked within other comprehensive income to reflect the impact from the positive unrealised valuation movement for half year 2019 of £2,617 million (31 December 2018: negative unrealised valuation movement of £(1,617) million). These adjustments reflect the movement from period to period, in the changes to the pattern of reported gross profits that would have happened if the assets reflected in the statement of financial position had been sold, crystallising the unrealised gains and losses, and the proceeds reinvested at the yields currently available in the market. At 30 June 2019, the cumulative shadow DAC balance as shown in the table above was negative £(489) million (31 December 2018: negative £(49) million). (c) Sensitivity of amortisation charge The amortisation charge to the income statement is reflected in both adjusted IFRS operating profit based on longer-term investment returns and short-term fluctuations in investment returns. The amortisation charge to adjusted IFRS operating profit based on longer-term investment returns in a reporting period comprises: — A core amount that reflects a relatively stable proportion of underlying premiums or profit; and — An element of acceleration or deceleration arising from market movements differing from expectations. In periods where the cap and floor feature of the mean reversion technique (which is used for moderating the effect of short-term volatility in investment returns) are not relevant, the technique operates to dampen the second element above. Nevertheless, extreme market movements can cause material acceleration or deceleration of amortisation in spite of this dampening effect. Furthermore, in those periods where the cap or floor is relevant, the mean reversion technique provides no further dampening and additional volatility may result. In the first half of 2019, the DAC amortisation charge for adjusted IFRS operating profit based on longer-term investment returns was determined after including a credit for decelerated amortisation of £148 million (half year 2018 charge for accelerated: £(42) million). The deceleration arising in the first half of 2019 reflects a mechanical decrease in the projected separate account return for the next five years under the mean-reversion technique. Under this technique the projected level of return for each of the next five years is adjusted so that in combination with the actual rates of return for the preceding three years (including the current period) the assumed long-term annual separate account return of 7.4 per cent is realised on average over the entire eight-year period. The deceleration in DAC amortisation in the first half of 2019 is driven both by the actual separate account return in the period being higher than that assumed and by the higher than expected return in 2016 falling out of the eight-year period. The application of the mean reversion formula has the effect of dampening the impact of equity market movements on DAC amortisation while the mean reversion assumption lies within the corridor. At 30 June 2019, it would take approximate movements in separate account values of more than either negative 35 per cent or positive 30 per cent for mean reversion assumption to move outside the corridor. |
Borrowings
Borrowings | 6 Months Ended |
Jun. 30, 2019 | |
Borrowings | |
Borrowings | C6 Borrowings C6.1 Core structural borrowings of shareholder-financed businesses 2019 £m 2018 £m 30 Jun 31 Dec Holding company operations: note (i) Subordinated debt with no option to substitute to M&GPrudential: US$250m 6.75% Notes (Tier 1) note (ii) 196 196 US$300m 6.5% Notes (Tier 1) note (ii) 236 235 US$550m 7.75% Notes (Tier 1) — — Perpetual Subordinated Capital Securities (Tier 1) 432 431 US$700m 5.25% Notes (Tier 2) 550 550 US$1,000m 5.25% Notes (Tier 2) 781 780 US$725m 4.375% Notes (Tier 2) 566 565 US$750m 4.875% Notes (Tier 2) 584 583 Perpetual Subordinated Capital Securities (Tier 2) 2,481 2,478 €20m Medium Term Notes 2023 (Tier 2) 18 18 £435m 6.125% Notes 2031 (Tier 2) 431 431 £400m 11.375% Notes 2039 (Tier 2) note (iii) — 399 Subordinated notes (Tier 2) 449 848 Subordinated debt total 3,362 3,757 Senior debt: note (iv) £300m 6.875% Bonds 2023 295 294 £250m 5.875% Bonds 2029 224 223 Bank loan note (v) 275 275 Total debt before amounts capable of being substituted to M&GPrudential note (vii) 4,156 4,549 Subordinated debt capable of being substituted to M&GPrudential as at 30 Jun 2019: £600m 5.56% (30 Jun and 31 Dec 2018: 5.0%) Notes 2055 (Tier 2) note (vi) 642 591 £700m 6.34% (30 Jun and 31 Dec 2018: 5.7%) Notes 2063 (Tier 2) note (vi) 814 696 £750m 5.625% Notes 2051 (Tier 2) 744 743 £500m 6.25% Notes 2068 (Tier 2) 498 498 US$500m 6.5% Notes 2048 (Tier 2) 391 391 Total subordinated debt capable of being substituted to M&GPrudential as at 30 Jun 2019 note (vii) 3,089 2,919 Holding company total 7,245 7,468 Prudential Capital bank loan note (v) — — Jackson US$250m 8.15% Surplus Notes 2027 note(viii) 196 196 Total (per condensed consolidated statement of financial position) 7,441 7,664 Notes (i) The debt tier classifications used are consistent with the treatment of capital for regulatory purposes under the Solvency II regime.The Group has designated US$3,725 million (31 December 2018: US$3,725 million) of its US dollar denominated subordinated debt as a net investment hedge under IAS 39 to hedge the currency risks related to the net investment in Jackson. (ii) These borrowings can be converted, in whole or in part, at the Company’s option and subject to certain conditions, on any interest payment date, into one or more series of Prudential preference shares. (iii) In May 2019, the Company redeemed its £400 million 11.375 per cent Tier 2 subordinated notes. (iv) The senior debt ranks above subordinated debt in the event of liquidation.In 2018, as part of its preparation to demerge M&GPrudential, the Group made certain modifications to the terms and conditions of the senior bonds with bondholders’ consent. The amendment to the terms and conditions will avoid an event of a technical default on the bonds, should the proposed demerger proceed. The fees paid to bondholders have been adjusted to the carrying value of the bonds and will be amortised in subsequent periods. No other adjustments were made to the carrying value of the debt as a result of the modification. (v) The bank loan of £275 million is drawn at a cost of 12-month GBP LIBOR plus 0.33 per cent. The loan, held by Prudential Capital at 30 June 2018, was renewed in December 2018 with Prudential plc being the new holder. The loan matures on 20 December 2022 with an option to repay annually. (vi) In the first half of 2019, the Group agreed with the holders of these two subordinated debt instruments that, in return for an increase in the coupon of the two instruments and upfront fees totalling £141 million for both instruments, they would permit the substitution of M&GPrudential as the issuer of the instruments, together with other modifications of terms to ensure the debt meet the requirements of Solvency II. In accordance with IAS 39, this has been accounted for as an extinguishment of the old debt and the issuance of new debt, recognised at fair value. The loss arising from this revaluation has been treated as an expense attributable to the M&GPrudential segment (see note D2.1). The £141 million of upfront fees have been paid by Prudential plc and have been treated as a non-operating expense. (vii) The annualised interest of debt that is not capable of being substituted to M&GPrudential, using coupon rates and exchange rates at 30 June 2019, is £(234) million. The interest charge to the income statement for the six months ended 30 June 2019 for debt that is capable of being substituted to M&GPrudential was £(85) million (half year 2018: £(35) million). (viii) Jackson’s borrowings are unsecured and subordinated to all present and future indebtedness, policy claims and other creditor claims of Jackson. Prior to the proposed demerger, the Group expects to rebalance its debt capital across Prudential plc and M&GPrudential. This will include the ultimate holding company of M&GPrudential becoming an issuer of debt following substitution from Prudential plc. Based on the operating environment and economic conditions as at 30 June 2019, the total debt expected to be transferred valued at original proceeds less unamortised transaction costs is £3.2 billion, of which £2.9 billion was held by Prudential plc at 30 June 2019 (IFRS value of £3.1 billion), with a further £0.3 billion (coupon of 3.875 per cent) raised in July 2019. C6.2 Other borrowings (i) Operational borrowings attributable to shareholder-financed businesses 2019 £m 2018 £m 30 Jun 31 Dec Borrowings in respect of short-term fixed income securities programmes 661 472 Lease liability for operating leases note (a) 229 — Non-recourse borrowings of consolidated investment funds note (b) 545 263 Other borrowings note (c) 229 263 Total 1,664 998 Analysed as: Total from continuing operations 892 Total from discontinued UK and Europe operations* 106 998 * Classified as discontinued operations at 30 June 2019 (as described in note A2). Notes (a) The Group adopted IFRS 16 as at 1 January 2019, using the modified retrospective approach. Under this approach, comparative information is not restated (as described in note A3). (b) In all instances, the holders of the debt instruments issued by these subsidiaries and funds do not have recourse beyond the assets of those subsidiaries and funds. (c) Other borrowings mainly include senior debt issued through the Federal Home Loan Bank of Indianapolis (FHLB), secured by collateral posted with the FHLB by Jackson. (ii) Borrowings attributable to with-profits businesses 2019 £m 2018 £m 30 Jun 31 Dec Non-recourse borrowings of consolidated investment funds note (a) — 3,845 Other borrowings (predominantly obligations under leases) note (b) 238 95 Total 238 3,940 Analysed as: Total from continuing operations 19 Total from discontinued UK and Europe operations* 3,921 3,940 * Notes (a) In all instances the holders of the debt instruments issued by these subsidiaries and funds do not have recourse beyond the assets of those subsidiaries and funds. (b) The Group adopted IFRS 16 as at 1 January 2019, using the modified retrospective approach. Under this approach, comparative information is not restated. Other borrowings at 30 June 2019 included £213 million relating to lease liabilities (as described in note A3). |
Deferred tax
Deferred tax | 6 Months Ended |
Jun. 30, 2019 | |
Deferred tax | |
Deferred tax | C7 Deferred tax The analysis below excludes the UK and Europe operations which are classified as held for distribution as at 30 June 2019. The balances of the discontinued UK and Europe operations are removed from the opening balance. The statement of financial position contains the following deferred tax assets and liabilities in relation to: Half year 2019 £m Movement Other through movements other including Reclassification Movement in comprehensive foreign as held for income income and currency At 1 Jan distribution* statement equity movements At 30 Jun Deferred tax assets Unrealised losses or gains on investments 113 — (13) — (97) 3 Balances relating to investment and insurance contracts 1 — — — — 1 Short-term temporary differences 2,339 (115) 392 (1) 5 2,620 Capital allowances 15 (11) (1) — — 3 Unused tax losses 127 — 8 — — 135 Total 2,595 (126) 386 (1) (92) 2,762 Deferred tax liabilities Unrealised losses or gains on investments (867) 827 (40) (459) 74 (465) Balances relating to investment and insurance contracts (1,002) — (189) — 2 (1,189) Short-term temporary differences (2,097) 183 (139) 16 (5) (2,042) Capital allowances (56) 51 — — — (5) Total (4,022) 1,061 (368) (443) 71 (3,701) * The principal reason for the increase in deferred tax assets in continuing operations is an increase in the deferred tax asset for losses on derivatives in the US insurance business, which for US tax purposes are spread across three years, reflecting a higher level of losses in the first half of 2019 (and therefore a higher amount deferred to subsequent periods) compared to prior periods. |
Defined benefit pension schemes
Defined benefit pension schemes | 6 Months Ended |
Jun. 30, 2019 | |
Defined benefit pension schemes | |
Defined benefit pension schemes | C8 Defined benefit pension schemes The Group’s businesses operate a number of pension schemes. The largest defined benefit scheme is the principal UK scheme, namely the Prudential Staff Pension Scheme (PSPS). The Group also operates two smaller UK defined benefit schemes in respect of Scottish Amicable (SASPS) and M&G (M&GGPS). Historically, all pension surplus and deficits were attributable to subsidiaries of M&GPrudential in line with the Group’s allocation policy, with the exception of 30 per cent of the surplus attaching to PSPS, which was allocated to Prudential plc. In preparation for the proposed demerger of M&GPrudential, at 30 June 2019, the 30 per cent of surplus attaching to PSPS was formally reallocated to M&GPrudential Services Limited. Accordingly, at 30 June 2019, the IAS 19 pension assets/liabilities of all the UK schemes of a net deficit of £69 million was included within the held for distribution assets/liabilities of the discontinued UK and Europe operations. In addition to the UK schemes, there are two small defined benefit schemes in Taiwan which have negligible deficits. These other schemes remain with the continuing operations. |
Share capital, share premium an
Share capital, share premium and own shares | 6 Months Ended |
Jun. 30, 2019 | |
Share capital, share premium and own shares | |
Share capital, share premium and own shares | C9 Share capital, share premium and own shares 30 Jun 2019 31 Dec 2018 Share Share Share Share Number of capital premium Number of ordinary capital premium Issued shares of 5p each fully paid: ordinary shares £m £m shares £m £m At 1 January 2,593,044,409 130 1,964 2,587,175,445 129 1,948 Shares issued under share-based schemes 6,751,790 — 10 5,868,964 1 16 At end of period 2,599,796,199 130 1,974 2,593,044,409 130 1,964 Amounts recorded in share capital represent the nominal value of the shares issued. The difference between the proceeds received on issue of shares, net of issue costs, and the nominal value of shares issued is credited to the share premium account. At each period end shown below, there were options outstanding under Save As You Earn schemes to subscribe for shares as follows: Number of shares Share price range Exercisable to subscribe for from to by year 30 Jun 2019 3,808,687 901 p 1,455 p 31 Dec 2018 4,885,804 901 p 1,455 p Transactions by Prudential plc and its subsidiaries in Prudential plc shares The Group buys and sells Prudential plc shares (‘own shares’) either in relation to its employee share schemes or via transactions undertaken by authorised investment funds that the Group is deemed to control. The cost of own shares of £179 million at 30 June 2019 (31 December 2018: £170 million) is deducted from retained earnings. The Company has established trusts to facilitate the delivery of shares under employee incentive plans. At 30 June 2019, 9.5 million (31 December 2018: 9.6 million) Prudential plc shares with a market value of £163 million (31 December 2018: £135 million) were held in such trusts, all of which are for employee incentive plans. The maximum number of shares held during the period was 14.1 million which was in March 2019. Within the trust, shares are notionally allocated by business unit reflecting the employees to which the awards were made. On demerger, it is intended that shares allocated to M&GPrudential will be transferred to a separate trust, established by M&GPrudential. The Company purchased the following number of shares in respect of employee incentive plans: Number of shares purchased Cost (in millions) £m Half year 2019 3.1 49.4 Full year 2018 2.6 44.8 The Group has consolidated a number of authorised investment funds where it is deemed to control these funds under IFRS. Some of these funds hold shares in Prudential plc. The total number of shares held by these funds at 30 June 2019 was 3.0 million (31 December 2018: 3.0 million) and the cost of acquiring these shares of £21 million (31 December 2018: £20 million) is included in the cost of own shares. The market value of these shares as at 30 June 2019 was £52 million (31 December 2018: £42 million). All share transactions were made on an exchange other than the Stock Exchange of Hong Kong. Other than set out above, the Group did not purchase, sell or redeem any Prudential plc listed securities during half year 2019 or 2018. |
Gain (loss) on disposal of busi
Gain (loss) on disposal of business and corporate transactions undertaken by continuing operations | 6 Months Ended |
Jun. 30, 2019 | |
Gain (loss) on disposal of business and corporate transactions undertaken by continuing operations | |
Gain (loss) on disposal of business and corporate transactions undertaken by continuing operations | D1 Gain (loss) on disposal of business and corporate transactions undertaken by continuing operations 2019 £m 2018 £m Half year Half year Gain on disposals note (i) 209 — Other transactions note (ii) (196) (57) 13 (57) Notes (i) In half year 2019, the £209 million gain on disposals principally relates to profits arising from a reduction in the Group’s stake (from 26 per cent to 22 per cent) in its associate in India, ICICI Prudential Life Insurance Company, and the disposal of Prudential Vietnam Finance Company Limited, a wholly owned subsidiary that provides consumer finance. (ii) Other transaction costs of £(196) million incurred by the continuing operations of the Group in half year 2019 reflect costs related to the preparation for the proposed demerger of M&GPrudential from Prudential plc. These include the following amounts: - £(18) million transaction related costs, principally fees to advisors; - £(141) million being the fee paid to the holders of two subordinated debt instruments as discussed in note C6.1(vi); and - £(37) million for one-off costs arising from the separation of the M&GPrudential business from Prudential plc. In 2018, other transaction costs additionally included amounts from exiting the NPH broker-dealer business in the US. |
Discontinued UK and Europe oper
Discontinued UK and Europe operations held for distribution | 6 Months Ended |
Jun. 30, 2019 | |
Discontinued UK and Europe operations held for distribution | |
Discontinued UK and Europe operations held for distribution | D2 In March 2018, the Group announced its intention to demerge its UK and Europe operations (M&GPrudential) from the Group, resulting in two separately listed companies by issuing shares in a newly listed company to existing shareholders. As discussed in note A2, the Group’s UK and Europe operations have been classified as discontinued operations and held for distribution in these condensed consolidated financial statements in accordance with IFRS 5, ‘Non-current assets held for sale and discontinued operations’. The results for the discontinued operations presented in the consolidated financial statements are analysed below: D2.1 2019 £m 2018 £m Half year Half year Gross premiums earned 5,907 6,555 Outward reinsurance premiums (487) (12,598) Earned premiums, net of reinsurance 5,420 (6,043) Investment return 13,072 53 Other income 643 890 Total revenue, net of reinsurance 19,135 (5,100) Benefits and claims and movement in unallocated surplus of with-profits funds, net of reinsurance (16,361) 6,421 Fair value loss on debt extinguishment note (a) (169) — Acquisition costs and other expenditure (1,391) (1,250) Total charges, net of reinsurance (17,921) 5,171 Share of profits from joint ventures and associates, net of related tax 33 20 Profit before tax (being tax attributable to shareholders’ and policyholders’ returns) note (b) 1,247 91 Less tax charge attributable to policyholders’ returns (430) 10 Profit before tax attributable to shareholders 817 101 Total tax charge attributable to policyholders and shareholders (602) (8) Adjustment to remove tax charge attributable to policyholders’ returns 430 (10) Tax charge attributable to shareholders’ returns (172) (18) Profit for the period 645 83 Notes (a) (b) Other comprehensive income The other comprehensive income included in the consolidated statement of comprehensive income in respect of the discontinued UK and Europe operations is as follows: 2019 £m 2018 £m Half year Half year Other comprehensive income (loss) from continuing operations: Exchange movements arising during the period 2 (3) Items that will not be reclassified to profit or loss Shareholders' share of actuarial gains and (losses) on defined benefit pension schemes: Net actuarial (losses) gains on defined benefit pension schemes (177) 104 Related tax 30 (18) (147) 86 Deduct amount attributable to UK with-profit funds transferred to unallocated surplus of with-profit funds, net of related tax 149 (21) 2 65 Other comprehensive income for the period, net of related tax 4 62 The profit and other comprehensive income for the period from the discontinued UK and Europe operations were wholly attributable to the equity holders of the Company. Assumption changes For the shareholder-backed business, the adjusted IFRS operating profit based on longer-term investment returns of the discontinued UK and Europe operations includes a benefit of £127 million (half year 2018: nil) relating to changes to annuitant mortality assumptions, including the adoption of the Continuous Mortality Investigation (CMI) 2017 model with an uplift to the calibration such that additional liabilities are held to cover potential differences in experience between the PAC policyholder portfolio and the England and Wales population, in addition to the usual provisions for adverse deviation included when determining policyholder liabilities (half year 2018: no changes). D2.2 2019 £m 2018‡ £m Other funds and subsidiaries Annuity Asset With- Unit- and Total manage- Elimina- 30 Jun 31 Dec By operating segment profits † linked other insurance ment tions Total Total Assets Goodwill note (a) 202 — — 202 1,153 — 1,355 1,359 Deferred acquisition costs and other intangible assets 47 — 110 157 17 — 174 195 Property, plant and equipment note (b) 997 — 66 1,063 370 — 1,433 1,031 Reinsurers' share of insurance contract liabilities 1,136 119 1,435 2,690 — — 2,690 2,812 Deferred tax assets 58 — 43 101 17 — 118 126 Current tax recoverable 215 — 57 272 7 — 279 244 Accrued investment income 1,056 89 290 1,435 10 — 1,445 1,511 Other debtors 2,105 773 226 3,104 476 (151) 3,429 4,189 Investment properties 16,406 580 1,648 18,634 — — 18,634 17,914 Investment in joint ventures and associates accounted for using the equity method 566 — — 566 39 — 605 742 Loans note (e) 3,756 — 1,779 5,535 — — 5,535 5,567 Equity securities and portfolio holdings in unit trusts 45,743 13,678 16 59,437 216 — 59,653 53,810 Debt securities note (d) 54,796 8,727 21,614 85,137 37 — 85,174 85,956 Derivative assets 2,354 2 527 2,883 — — 2,883 2,513 Other investments 6,105 9 1 6,115 18 — 6,133 5,585 Deposits 13,422 1,235 2,135 16,792 — — 16,792 10,320 Assets held for sale 6 — 10,164 10,170 — — 10,170 10,578 Cash and cash equivalents 3,311 169 792 4,272 352 — 4,624 4,749 Total assets 152,281 25,381 40,903 218,565 2,712 (151) 221,126 209,201 Total equity — — 6,287 6,287 1,993 — 8,280 8,700 Liabilities Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) note (f) 118,148 21,172 20,284 159,604 — — 159,604 151,555 Unallocated surplus of with-profits funds note (f) 15,116 — — 15,116 — — 15,116 13,334 Operational borrowings attributable to shareholder-financed operations note (b) — 4 156 160 296 — 456 106 Borrowings attributable to with-profits businesses 3,580 — — 3,580 — — 3,580 3,921 Obligations under funding, securities lending and sale and repurchase agreements 846 — 208 1,054 — — 1,054 1,224 Net asset value attributable to unit holders of consolidated unit trusts and similar funds 4,827 3,659 7 8,493 19 — 8,512 9,013 Deferred tax liabilities 995 — 163 1,158 29 — 1,187 1,061 Current tax liabilities 293 36 32 361 34 — 395 326 Accruals, deferred income and other liabilities 6,988 498 2,031 9,517 151 (151) 9,517 6,442 Provisions note (h) 21 — 373 394 190 — 584 743 Derivative liabilities 1,467 12 1,198 2,677 — — 2,677 2,208 Liabilities held for sale — — 10,164 10,164 — — 10,164 10,568 Total liabilities 152,281 25,381 34,616 212,278 719 (151) 212,846 200,501 Total equity and liabilities 152,281 25,381 40,903 218,565 2,712 (151) 221,126 209,201 * The statement of financial position as shown above reflects the segmental position of the discontinued UK and Europe operations and is therefore presented before the elimination of intragroup balances with continuing operations. † Includes the Scottish Amicable Insurance Fund which, at 30 June 2019, has total assets and liabilities of £4,887 million (31 December 2018: £4,844 million). The PAC with-profits sub-fund (WPSF) mainly contains with-profits business but it also contains some non-profit business (unit-linked, term assurances and annuities). The PAC with-profits fund includes £9.6 billion (31 December 2018: £9.5 billion) of non-profits annuities liabilities. ‡ The 2018 comparatives assets and liabilities have not been re-presented to be classified as held for distribution on the Group’s statement of financial position (as described in note A2). Notes (a) At 30 June 2019, £1,153 million goodwill in M&G Investments is attributable to shareholders (31 December 2018: £1,153 million) and £202 million goodwill in venture fund investments is attributable to with-profits funds (31 December 2018: £206 million). (b) As at 1 January 2019, the Group applied IFRS 16, ‘Leases’, using the modified retrospective approach. Under this approach, comparative information is not restated. The application of the standard has resulted in the recognition of an additional lease liability and a corresponding ‘right-of-use’ asset of a similar amount as at 1 January 2019. See note A3 for further details. As at 30 June 2019, right-of-use assets recognised in property, plant and equipment amounted to £278 million. (c) Assets and liabilities carried at fair value on the statement of financial position The table below shows the assets and liabilities carried at fair value as at each period end indicated, analysed by level of the IFRS 13, ‘ Fair Value Measurement ’ , defined fair value hierarchy. This hierarchy is based on the inputs to the fair value measurement and reflects the lowest level input that is significant to that measurement. 30 Jun 2019 £m Level 1 Level 2 Level 3 Valuation Valuation Quoted prices based on based on (unadjusted) significant significant Analysis of financial investments, net of derivative liabilities in active observable unobservable by business type markets market inputs market inputs Total With-profits Loans — — 1,637 1,637 Equity securities and portfolio holdings in unit trusts 41,593 3,758 392 45,743 Debt securities 7,534 46,410 852 54,796 Other investments (including derivative assets) 66 3,282 5,111 8,459 Derivative liabilities (60) (1,400) (7) (1,467) Total financial investments, net of derivative liabilities 49,133 52,050 7,985 109,168 Percentage of total (%) 45 % 48 % 7 % 100 % Unit-linked Equity securities and portfolio holdings in unit trusts 12,728 939 11 13,678 Debt securities 1,818 6,909 — 8,727 Other investments (including derivative assets) 4 — 7 11 Derivative liabilities (4) (8) — (12) Total financial investments, net of derivative liabilities 14,546 7,840 18 22,404 Percentage of total (%) 65 % 35 % 0 % 100 % Shareholder-backed annuities and other Loans — — 303 303 Equity securities and portfolio holdings in unit trusts 232 — — 232 Debt securities 3,560 17,754 337 21,651 Other investments (including derivative assets) — 527 19 546 Derivative liabilities (1) (1,197) — (1,198) Total financial investments, net of derivative liabilities 3,791 17,084 659 21,534 Percentage of total (%) 18 % 79 % 3 % 100 % UK and Europe total analysis, including other financial liabilities held at fair value Loans — — 1,940 1,940 Equity securities and portfolio holdings in unit trusts 54,553 4,697 403 59,653 Debt securities 12,912 71,073 1,189 85,174 Other investments (including derivative assets) 70 3,809 5,137 9,016 Derivative liabilities (65) (2,605) (7) (2,677) Total financial investments, net of derivative liabilities 67,470 76,974 8,662 153,106 Investment contract liabilities without discretionary participation features held at fair value — (15,695) — (15,695) Borrowings attributable to with-profits businesses — — (1,504) (1,504) Net asset value attributable to unit holders of consolidated unit trusts and similar funds (6,784) (744) (984) (8,512) Other financial liabilities held at fair value — — (379) (379) Total financial instruments at fair value 60,686 60,535 5,795 127,016 Percentage of total (%) 47 % 48 % 5 % 100 % 31 Dec 2018 £m Level 1 Level 2 Level 3 Valuation Valuation Quoted prices based on based on (unadjusted significant significant Analysis of financial investments, net of derivative liabilities in active observable unobservable by business type markets market inputs market inputs Total With-profits Loans — — 1,703 1,703 Equity securities and portfolio holdings in unit trusts 37,027 3,728 335 41,090 Debt securities 8,374 44,619 805 53,798 Other investments (including derivative assets) 56 3,149 4,325 7,530 Derivative liabilities (64) (1,201) — (1,265) Total financial investments, net of derivative liabilities 45,393 50,295 7,168 102,856 Percentage of total (%) 44 % 49 % 7 % 100 % Unit-linked Equity securities and portfolio holdings in unit trusts 12,150 318 9 12,477 Debt securities 1,750 8,762 — 10,512 Other investments (including derivative assets) 4 1 6 11 Derivative liabilities (1) (2) — (3) Total financial investments, net of derivative liabilities 13,903 9,079 15 22,997 Percentage of total (%) 60 % 40 % 0 % 100 % Shareholder-backed annuities and other Loans — — 267 267 Equity securities and portfolio holdings in unit trusts 242 — 1 243 Debt securities 3,804 17,470 372 21,646 Other investments (including derivative assets) 1 554 2 557 Derivative liabilities — (940) — (940) Total financial investments, net of derivative liabilities 4,047 17,084 642 21,773 Percentage of total (%) 19 % 78 % 3 % 100 % UK and Europe total analysis, including other financial liabilities held at fair value Loans — — 1,970 1,970 Equity securities and portfolio holdings in unit trusts 49,419 4,046 345 53,810 Debt securities 13,928 70,851 1,177 85,956 Other investments (including derivative assets) 61 3,704 4,333 8,098 Derivative liabilities (65) (2,143) — (2,208) Total financial investments, net of derivative liabilities 63,343 76,458 7,825 147,626 Investment contract liabilities without discretionary participation features held at fair value — (15,560) — (15,560) Borrowings attributable to with-profits businesses — — (1,606) (1,606) Net asset value attributable to unit holders of consolidated unit trusts and similar funds (7,443) (582) (988) (9,013) Other financial liabilities held at fair value — — (355) (355) Total financial instruments at fair value 55,900 60,316 4,876 121,092 Percentage of total (%) 46 % 50 % 4 % 100 % Level 3 fair value assets and liabilities At 30 June 2019, the discontinued UK and Europe operations held £5,795 million of net financial instruments at fair value within level 3, which comprises externally valued net assets of £5,632 million, primarily in private equity funds and investments in property funds which are exposed to bespoke properties or risks, and net assets of £163 million relating to investments which are internally valued or subject to a number of unobservable assumptions. The internally valued net assets include investments in debt securities, private equity and venture investment in both debt and equity securities and equity release mortgage loans, which are valued using a discounted cash flow method. Transfers into and transfers out of levels During half year 2019, the transfers between levels within the UK and Europe operations portfolio, were primarily transfers from level 1 to level 2 of £104 million and from level 1 to level 3 of £19 million. These transfers which relate mainly to debt securities and other financial investments arose to reflect the change in the observed valuation inputs and in certain cases, the change in the level of trading activities of the securities. In addition, there were transfers from level 2 to level 3 of £58 million and transfers from level 3 to level 2 of £118 million for equity securities and debt securities. Assets and liabilities at amortised cost and their fair value The table below shows the financial assets and liabilities carried at amortised cost on the statement of financial position and their fair value. Cash deposits, accrued income, other debtors, accruals, deferred income and other liabilities are excluded from the analysis below, as these are carried at amortised cost, which approximates fair value. 2019 £m 2018 £m 30 Jun 31 Dec Carrying Fair Carrying Fair value value value value Assets Loans 3,595 4,149 3,597 4,008 Liabilities Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses (114) (114) (106) (106) Borrowings (excluding lease liabilities) attributable to the with-profits funds (2,038) (2,038) (2,315) (2,085) Obligations under funding, securities lending and sale and repurchase agreements (1,054) (1,054) (1,224) (1,224) Total financial instruments carried at amortised cost 389 943 (48) 593 (d) Debt securities are carried at fair value through profit or loss and are analysed below according to external credit ratings issued, with equivalent ratings issued by different rating agencies grouped together. 30 Jun 2019 £m BBB+ AAA AA+ to AA- A+ to A- to BBB- Below BBB- Other* Total With-profits 5,401 8,488 13,446 15,641 2,824 8,996 54,796 Unit-linked 578 2,025 1,959 2,450 934 781 8,727 Non-linked shareholder-backed 2,791 6,115 4,615 1,655 211 6,264 21,651 Total debt securities 8,770 16,628 20,020 19,746 3,969 16,041 85,174 31 Dec 2018 £m BBB+ to AAA AA+ to AA- A+ to A- BBB- Below BBB- Other* Total With-profits 6,890 9,332 11,779 14,712 2,891 8,194 53,798 Unit-linked 1,041 2,459 2,215 3,501 395 901 10,512 Non-linked shareholder-backed 3,007 6,413 4,651 1,515 158 5,902 21,646 Total debt securities 10,938 18,204 18,645 19,728 3,444 14,997 85,956 * Securities with credit ratings classified as ‘Other’ which are internally rated and are analysed as follows: 2019 £m 2018 £m 30 Jun 31 Dec AAA to A- 8,630 8,150 BBB to B- 2,947 3,034 Below B- or unrated 4,464 3,813 Total UK and Europe 16,041 14,997 The Group exposures held by the shareholder-backed business and with-profits funds in sovereign debts and bank debt securities at 30 June 2019 are analysed as follows: Exposure to sovereign debts 30 Jun 2019 £m 31 Dec 2018 £m With- With- Shareholder-backed profits Shareholder-backed profits business funds business funds Italy — 59 — 57 Spain 49 19 36 18 France 23 — — 50 Germany* 240 324 239 281 Other Eurozone 100 33 103 34 Total Eurozone 412 435 378 440 United Kingdom 2,235 2,636 2,300 3,013 United States — 632 — 1,261 Other 60 208 57 198 Total 2,707 3,911 2,735 4,912 * Including bonds guaranteed by the federal government. Exposure to bank debt securities 30 Jun 2019 £m 2018 £m Senior debt Subordinated debt 31 Dec Shareholder-backed business Covered Senior Total Tier 1 Tier 2 Total Group total Group total Italy — — — — — — — — Spain — — — — — — — — France 21 36 57 — — — 57 20 Germany — — — — 90 90 90 83 Netherlands — 37 37 — — — 37 17 Other Eurozone — — — — — — — — Total Eurozone 21 73 94 — 90 90 184 120 United Kingdom 450 243 693 — 67 67 760 674 United States — 252 252 — 29 29 281 253 Asia — — — — — — — — Other — — — — 36 36 36 40 Total 471 568 1,039 — 222 222 1,261 1,087 With-profits funds Italy — 39 39 — — — 39 38 Spain — 26 26 — — — 26 17 France 6 363 369 — 74 74 443 348 Germany 116 63 179 — 8 8 187 185 Netherlands — 288 288 — — — 288 249 Other Eurozone — 86 86 — — — 86 74 Total Eurozone 122 865 987 — 82 82 1,069 911 United Kingdom 877 873 1,750 52 322 374 2,124 2,096 United States — 2,771 2,771 16 335 351 3,122 2,709 Asia — 127 127 — — — 127 106 Other 506 998 1,504 15 35 50 1,554 1,616 Total 1,505 5,634 7,139 83 774 857 7,996 7,438 The tables above exclude assets held to cover linked liabilities and those of the consolidated unit trusts and similar funds. In addition, the tables above exclude the proportionate share of sovereign debt holdings of the UK and Europe's joint venture operations. (e) The amounts included in the statement of financial position are analysed as follows: 30 Jun 2019 £m 31 Dec 2018 £m Mortgage Policy Other Mortgage Policy Other loans * loans loans † Total loans* loans loans † Total With-profits 2,260 3 1,493 3,756 2,461 3 1,389 3,853 Non-linked shareholder-backed 1,711 — 68 1,779 1,655 — 59 1,714 Total loans securities 3,971 3 1,561 5,535 4,116 3 1,448 5,567 * All mortgage loans are secured by properties. † Other loans held in the UK with-profits funds are commercial loans and comprise mainly syndicated loans. (f) Shareholder-backed funds and subsidiaries Annuity Total and other discontinued With-profits Unit-linked long-term UK and Europe Half year 2019 movements £m sub-fund‡ liabilities business opertions At 1 January 2019 124,129 20,717 20,043 164,889 Comprising: - Policyholder liabilities 110,795 20,717 20,043 151,555 - Unallocated surplus of with-profits funds 13,334 — — 13,334 Premiums 5,668 447 151 6,266 Surrenders (2,462) (1,548) (25) (4,035) Maturities/deaths (2,309) (224) (617) (3,150) Net flows 897 (1,325) (491) (919) Shareholders' transfers post tax (130) — — (130) Switches (57) 57 — — Investment-related items and other movements 8,431 1,669 732 10,832 Foreign exchange translation differences (6) 54 — 48 At 30 June 2019 133,264 21,172 20,284 174,720 Comprising: - Policyholder liabilities 118,148 21,172 20,284 159,604 - Unallocated surplus of with-profits funds 15,116 — — 15,116 Half year 2018 movements £m At 1 January 2018 124,699 23,145 33,222 181,066 Comprising: - Policyholder liabilities 111,222 23,145 33,222 167,589 - Unallocated surplus of with-profits funds 13,477 — — 13,477 Reclassification of reinsured UK annuity contracts as held for sale* — — (12,002) (12,002) Premiums 6,283 516 165 6,964 Surrenders (2,246) (1,163) (37) (3,446) Maturities/deaths (2,205) (313) (981) (3,499) Net flows 1,832 (960) (853) 19 Shareholders' transfers post tax (127) — — (127) Switches (89) 89 — — Investment-related items and other movements (476) (76) (249) (801) Foreign exchange translation differences 17 — — 17 At 30 June 2018 125,856 22,198 20,118 168,172 Comprising: - Policyholder liabilities 112,339 22,198 20,118 154,655 - Unallocated surplus of with-profits funds 13,517 — — 13,517 Average policyholder liability balances † Half year 2019 114,472 20,945 20,163 155,580 Half year 2018 111,781 22,671 26,670 161,122 * The reclassification of the reinsured UK annuity business as held for sale reflects the value of policyholder liabilities held at 1 January 2018. Movements in items covered by the reinsurance contract prior to the 14 March inception date are included within net flows. † ‡ (g) Allowance for credit risk For IFRS reporting, the results for UK shareholder-backed annuity business are particularly sensitive to the allowances made for credit risk. The allowance is reflected in the deduction from the valuation rate of interest used for discounting projected future annuity payments to policyholders that would have otherwise applied. The credit risk allowance comprises an amount for long-term best estimate defaults and additional provisions for credit risk premium, the cost of downgrades and short-term defaults. The IFRS credit risk allowance made for the UK shareholder-backed fixed and linked annuity business equated to 40 basis points at 30 June 2019 (30 June 2018: 44 basis points; 31 December 2018: 40 basis points). The allowance represented 21 per cent of the bond spread over swap rates (30 June 2018: 26 per cent; 31 December 2018: 22 per cent). The reserves for credit risk allowance at 30 June 2019 for the UK shareholder-backed business were £0.9 billion (30 June 2018: £1.1 billion; 31 December 2018: £0.9 billion). The 30 June 2019 credit risk allowance information is after reflecting the impact of the reinsurance of £12.0 billion of the UK shareholder-backed annuity portfolio to Rothesay Life entered into in March 2018. (h) Review of past annuity sales Prudential has agreed with the Financial Conduct Authority (FCA) to review annuities sold without advice after 1 July 2008 to its contract-based defined contribution pension customers. The review is examining whether customers were given sufficient information about their potential eligibility to purchase an enhanced annuity, either from Prudential or another pension provider. A gross provision of £400 million, before allowing for costs incurred to date, had been established at 31 December 2017 to cover the costs of undertaking the review and any related redress. In the first half of 2018, the Group agreed with its professional indemnity insurers that they would meet £166 million of the Group’s claims costs, which would be paid as the Group incurred costs/redress with amounts remaining to be paid classed as 'other debtors' in the statement of financial position. Following a reassessment of the provision held, no further amount has been provided in the first half of 2019. The ultimate amount that will be expended by the Group on the review, which is currently expected to be completed in 2019, remains uncertain. D2.3 2019 £m 2018 £m Half year Half year Cash flows from operating activities 404 (1,711) Cash flows from investing activities (172) (224) Cash flows from financing activities* (356) (445) Total cash flows in the period (124) (2,380) Cash and cash equivalents at beginning of period 4,749 5,808 Effect of exchange rate changes on cash and cash equivalents (1) (8) Cash and cash equivalents at end of period 4,624 3,420 * |
Contingencies and related oblig
Contingencies and related obligations | 6 Months Ended |
Jun. 30, 2019 | |
Contingencies and related obligations | |
Contingencies and related obligations | D3 Contingencies and related obligations In addition to the matters set out in note D2.2(h) in relation to the Financial Conduct Authority review of past annuity sales, the Group is involved in various litigation and regulatory issues. These may from time to time include class actions involving Jackson. While the outcome of such litigation and regulatory issues cannot be predicted with certainty, the Company believes that their ultimate outcome will not have a material adverse effect on the Group’s financial condition, results of operations, or cash flows. There have been no material changes to the Group’s contingencies and related obligations in the six month period ended 30 June 2019. |
Post balance sheet events
Post balance sheet events | 6 Months Ended |
Jun. 30, 2019 | |
Post balance sheet events | |
Post balance sheet events | D4 Post balance sheet events First interim ordinary dividend The 2019 first interim ordinary dividend approved by the Board of Directors after 30 June 2019 is as described in note B6. |
Related party transactions
Related party transactions | 6 Months Ended |
Jun. 30, 2019 | |
Related party transactions | |
Related party transactions | D5 Related party transactions There were no transactions with related parties during the six months ended 30 June 2019 which have had a material effect on the results or financial position of the Group. The nature of the related party transactions of the Group has not changed from those described in the Group’s consolidated financial statements for the year ended 31 December 2018. |
Background (Policies)
Background (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
BACKGROUND | |
Basis of preparation, audit status and exchange rates | A1 Basis of preparation, audit status and exchange rates These condensed consolidated interim financial statements for the six months ended 30 June 2019 have been prepared in accordance with IAS 34 ‘Interim Financial Reporting’ as issued by the International Accounting Standards Board (IASB) and as endorsed by the European Union (EU). The Group’s policy for preparing this interim financial information is to use the accounting policies adopted by the Group in its last consolidated financial statements, as updated by any changes in accounting policies it intends to make in its next consolidated financial statements as a result of new or amended IFRS and other policy improvements. EU-endorsed IFRS may differ from IFRSs issued by the IASB if, at any point in time, new or amended IFRS have not been endorsed by the EU. At 30 June 2019, there were no unendorsed standards effective for the period ended 30 June 2019 which impacted the condensed consolidated financial statements of the Group, and there were no differences between IFRS endorsed by the EU and IFRS issued by the IASB in terms of their application to the Group. The IFRS basis results for half year 2019 and half year 2018 are unaudited. Except for re-presenting the results for UK and Europe operations as discontinued operations, the 2018 full year IFRS basis results have been derived from Prudential’s 2018 audited consolidated financial statements filed with the Securities and Exchange Commission on Form 20-F. These 2018 consolidated financial statements do not represent Prudential’s statutory accounts for the purpose of the UK Companies Act 2006. The auditors have reported on the 2018 statutory accounts which have been delivered to the Registrar of Companies. The auditors’ report was: (i) unqualified; (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report; and (iii) did not contain a statement under section 498(2) or (3) of the Companies Act 2006. The exchange rates applied for balances and transactions in currencies other than the presentational currency of the Group, pounds sterling (GBP), were: Average Average Closing for the Closing for the Closing rate at 6 months to rate at 6 months to rate at 30 Jun 2019 30 Jun 2019 30 Jun 2018 30 Jun 2018 31 Dec 2018 Local currency: £ Hong Kong 9.94 10.15 10.36 10.78 9.97 Indonesia 17,980.07 18,364.05 18,919.18 18,938.64 18,314.37 Malaysia 5.26 5.33 5.33 5.42 5.26 Singapore 1.72 1.76 1.80 1.83 1.74 China 8.74 8.78 8.75 8.76 8.74 India 87.85 90.62 90.46 90.37 88.92 Vietnam 29,660.27 30,087.11 30,310.96 31,329.01 29,541.15 Thailand 39.06 40.91 43.74 43.66 41.47 US 1.27 1.29 1.32 1.38 1.27 The accounting policies applied by the Group in determining the IFRS basis results in this report are the same as those previously applied in the Group’s consolidated financial statements for the year ended 31 December 2018, as disclosed in the 2018 Form 20‑F, aside from those discussed in note A3 below. |
Accounting policies followed in interim financial statements | The accounting policies applied by the Group in determining the IFRS basis results in this report are the same as those previously applied in the Group’s consolidated financial statements for the year ended 31 December 2018, as disclosed in the 2018 Form 20‑F, aside from those discussed in note A3 below |
Discontinued operations | A2 Discontinued operations The Group is planning to demerge its UK and Europe operations, M&GPrudential, from the Prudential plc group in the fourth quarter of 2019. Following an assessment at 30 June 2019, in accordance with IFRS 5, ‘ Non-current assets held for sale and discontinued operations ’, the results of M&GPrudential have been classified as held for distribution and as discontinued operations at 30 June 2019 in these condensed consolidated financial statements. In order to present the results of the continuing operations on a comparable basis and consistent with IFRS 5 requirements, results attributable to the discontinued UK and Europe operations in half year 2019 have been shown in a single line in the income statement with 2018 comparatives being restated accordingly. Notes B1 to B5 have been prepared on a consistent basis. IFRS 5 requires the assets and liabilities of the UK and Europe operations at 30 June 2019 to be presented as single line 'assets held for distribution' and 'liabilities held for distribution' on the statement of financial position but does not permit the comparative 31 December 2018 assets and liabilities to be re-presented as the UK and Europe operations were not classified as held for distribution at these dates. In the related balance sheet notes, prior period balances have been presented to show the amounts from discontinued operations separately from continuing operations. Additionally, in the analysis of movements in Group assets and liabilities between the beginning and end of periods, the balances of the discontinued UK and Europe operations are removed from the opening balances to show the underlying movements from continuing operations. The profit from the discontinued UK and Europe operations is presented in the condensed consolidated income statement before the elimination of intragroup transactions with continuing operations in order to provide a more meaningful presentation of the position of the Group immediately after the proposed demerger. The condensed consolidated statement of financial position has been presented after the elimination of all intragroup balances. A detailed analysis of the earnings performance, financial position and cash flows in the periods from the discontinued UK and Europe operations is provided in note D2, with supplementary analysis on adjusted IFRS operating profit based on longer-term investment returns by driver provided in note I(vi) within the additional financial information. |
New accounting pronouncements in 2019 | A3 New accounting pronouncements in 2019 IFRS 16, ‘Leases’ The Group has adopted IFRS 16, 'Leases' from 1 January 2019. The new standard brings most leases on-balance-sheet for lessees under a single model, eliminating the distinction between operating and finance leases. IFRS 16 applies primarily to operating leases of major properties occupied by the Group’s businesses where Prudential is a lessee. Under IFRS 16, these leases are brought onto the Group’s statement of financial position with a ‘right-of-use’ asset being established and a corresponding liability representing the obligation to make lease payments. The rental accrual charge in the income statement under IAS 17 is replaced with a depreciation charge for the ‘right-of-use’ asset and an interest expense on the lease liability leading to a more front-loaded operating lease cost profile compared to IAS 17. As permitted by IFRS 16, the Group has chosen to adopt the modified retrospective approach upon transition to the new standard. Under the approach adopted, there is no adjustment to the Group’s retained earnings at 1 January 2019 and the Group’s 2018 comparative information is not restated. The right-of-use asset and lease liability at 1 January 2019 is set at an amount equal to the discounted remaining lease payments adjusted by any prepaid or accrued lease payment balance immediately before the date of initial application of the standard. When measuring lease liabilities on adoption, the Group discounted lease payments using its incremental borrowing rate at 1 January 2019. The weighted-average rate applied is 3.4 per cent. The aggregate effect of the adoption of the standard on the statement of financial position at 1 January 2019 is shown in the tables below: Consolidated statement of financial position Continuing Discontinued Effect of adoption of IFRS 16 at 1 January 2019 £m operations operations* Total Group Assets Property, plant and equipment (Right-of-use assets) 414 289 703 Total assets 414 289 703 Liabilities Operational borrowings attributable to shareholder-financed businesses (Lease liability) 206 304 510 Borrowings attributable to with-profits businesses (Lease liability) 219 21 240 Accruals, deferred income and other liabilities (Accrued lease payment balance under IAS 17) (11) (36) (47) Total liabilities 414 289 703 * Presented within assets and liabilities held for distribution at 30 June 2019. The Group has applied the practical expedient to grandfather the definition of a lease on transition. This means that IFRS 16 has been applied to all contracts, which were identified as leases in accordance with IAS 17 and IFRIC 4, ‘ Determining whether an Arrangement contains a Lease ’, entered into before 1 January 2019. Therefore, the definition of a lease under IFRS 16 was applied only to contracts entered into or changed on or after 1 January 2019. The Group has used the following practical expedients, in addition to the aforementioned when applying IFRS 16 to leases previously classified as operating leases under IAS 17: - Applied a single discount rate to a portfolio of leases with similar characteristics. Accordingly, for such portfolios, the incremental borrowing rates used to discount the future lease payments will be determined based on market specific risk-free rates adjusted with a margin/spread to reflect the Group’s credit standing, lease term and the outstanding lease payments. - Used hindsight when determining the lease term if the contract contains options to extend or terminate the lease. Other new accounting pronouncements In addition to the above, the IASB has also issued the following new accounting pronouncements to be effective from 1 January 2019: - IFRIC Interpretation 23, ‘Uncertainty over income tax treatments’; - Amendments to IAS 28, ‘Long-term Interests in Associates and Joint Ventures’; - Amendments to IFRS 9, 'Prepayment features with negative compensation'; - Annual Improvements to IFRSs 2015-2017 cycle; and - Amendments to IAS 19, ‘Plan Amendment, Curtailment or Settlement’. The Group has applied the principles within the Amendments to IAS 19, ' Plan Amendment, Curtailment or Settlement ', when accounting for the changes to the pension benefits of its UK defined benefit schemes during the period. The other pronouncements have had no significant impact on the Group financial statements |
Background and critical account
Background and critical accounting policies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
BACKGROUND | |
Schedule of exchange rates applied | Average Average Closing for the Closing for the Closing rate at 6 months to rate at 6 months to rate at 30 Jun 2019 30 Jun 2019 30 Jun 2018 30 Jun 2018 31 Dec 2018 Local currency: £ Hong Kong 9.94 10.15 10.36 10.78 9.97 Indonesia 17,980.07 18,364.05 18,919.18 18,938.64 18,314.37 Malaysia 5.26 5.33 5.33 5.42 5.26 Singapore 1.72 1.76 1.80 1.83 1.74 China 8.74 8.78 8.75 8.76 8.74 India 87.85 90.62 90.46 90.37 88.92 Vietnam 29,660.27 30,087.11 30,310.96 31,329.01 29,541.15 Thailand 39.06 40.91 43.74 43.66 41.47 US 1.27 1.29 1.32 1.38 1.27 |
Schedule of effect of IFRS 16 on statement of financial position | Continuing Discontinued Effect of adoption of IFRS 16 at 1 January 2019 £m operations operations* Total Group Assets Property, plant and equipment (Right-of-use assets) 414 289 703 Total assets 414 289 703 Liabilities Operational borrowings attributable to shareholder-financed businesses (Lease liability) 206 304 510 Borrowings attributable to with-profits businesses (Lease liability) 219 21 240 Accruals, deferred income and other liabilities (Accrued lease payment balance under IAS 17) (11) (36) (47) Total liabilities 414 289 703 * Presented within assets and liabilities held for distribution at 30 June 2019. |
Analysis of performance by se_2
Analysis of performance by segment (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Analysis of performance by segment | |
Schedule of segment results | 2019 £m 2018* £m Note Half year Half year note (iv) Asia: Insurance operations 1,095 927 Asset management 103 89 Total Asia 1,198 1,016 US: Jackson (US insurance operations) 1,203 1,001 Asset management 12 1 Total US 1,215 1,002 Total segment profit from continuing operations 2,413 2,018 Other income and expenditure: Investment return and other income 24 33 Interest payable on core structural borrowings note(i) (226) (189) Corporate expenditure note(ii) (164) (173) Total other income and expenditure (366) (329) Restructuring costs (23) (20) Adjusted IFRS operating profit based on longer-term investment returns from continuing operations B1.3 2,024 1,669 Short-term fluctuations in investment returns on shareholder-backed business B1.2 (1,124) 9 Amortisation of acquisition accounting adjustments note(iii) (17) (22) Gain (loss) on disposal of businesses and corporate transactions D1 13 (57) Profit from continuing operations before tax attributable to shareholders 896 1,599 Tax charge attributable to shareholders' returns B4 (1) (326) Profit from continuing operations for the period 895 1,273 Profit from discontinued operations for the period, net of related tax note(iv) D2.1 645 83 Profit for the period 1,540 1,356 Attributable to: Equity holders of the Company From continuing operations 890 1,272 From discontinued operations 645 83 Non-controlling interests from continuing operations 5 1 1,540 1,356 2018* Note Half year Half year Basic earnings per share (in pence) B5 note (iv) Based on adjusted IFRS operating profit based on longer-term investment returns, net of tax, from continuing operations note(v) 65.3 p 53.7 p Based on profit for the period from continuing operations 34.4 p 49.5 p Based on profit for the period from discontinued operations 25.0 p 3.2 p * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group's UK and Europe operations as discontinued operations at 30 June 2019 (as described in note A2). Notes (i) Interest charged to the income statement on debt that is capable of being substituted to M&GPrudential for the six months ended 30 June 2019 was £(85) million (see note C6.1 for further details). (ii) Corporate expenditure as shown above is primarily for Group Head Office and Asia Regional Head Office. (iii) Amortisation of acquisition accounting adjustments principally relate to the REALIC business of Jackson which was acquired in 2012. (iv) Profit from discontinued operations represents the post-tax profit contributed by the UK and Europe operations which are classified as held for distribution at 30 June 2019 (a line-by-line analysis of profit for the period for the discontinued UK and Europe operations is included in note D2.1, with supplementary analysis on adjusted IFRS operating profit based on longer-term investment returns by driver provided in note I(vi) within the additional financial information). The half year 2018 comparative results have been re-presented from those previously published accordingly (as described in note A2). (v) Tax charges have been reflected as operating and non-operating in the same way as for the pre-tax items. Further details on tax charges are provided in note B4. |
Schedules of short-term fluctuations in investment returns on shareholder-backed business | 2019 £m 2018* £m Half year Half year Asia operations note (i) 420 (326) US operations note (ii) (1,521) 244 Other operations note (iii) (23) 91 Total (1,124) 9 * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group’s UK and Europe operations as discontinued operations at 30 June 2019 (as described in note A2). (i) Asia operations In Asia, the positive short-term fluctuations of £420 million (half year 2018: negative £(326) million) principally reflect net value movements on shareholders’ assets and related liabilities following decrease in bond yields during the period. (ii) US operations The short-term fluctuations in investment returns for US insurance operations are reported net of the related credit for amortisation of deferred acquisition costs of £476 million as shown in note C5.2 (half year 2018: charge of £(199) million) and comprise amounts in respect of the following items: 2019 £m 2018 £m Half year Half year Net equity hedge result note (a) (1,955) 383 Other than equity-related derivatives note (b) 433 (183) Debt securities note (c) 11 6 Equity-type investments: actual less longer-term return (7) 31 Other items (3) 7 Total (1,521) 244 Notes (a) Net equity hedge result The purpose of the inclusion of this item in short-term fluctuations in investment returns is to segregate the amount included in pre-tax profit that relates to the accounting effect of market movements on both the value of guarantees in Jackson’s variable annuity and fixed index annuity products and on the related derivatives used to manage the exposures inherent in these guarantees. The level of fees recognised in non-operating profit is determined by reference to that allowed for within the reserving basis. The variable annuity guarantees are valued in accordance with either Accounting Standards Codification (ASC) Topic 820, Fair Value Measurements and Disclosures (formerly FAS 157) or ASC Topic 944, Financial Services – Insurance (formerly SOP 03-01) depending on the type of guarantee. Both approaches require an entity to determine the total fee (‘the fee assessment’) that is expected to fund future projected benefit payments arising using the assumptions applicable for that method. The method under FAS 157 requires this fee assessment to be fixed at the time of issue. As the fees included within the initial fee assessment are earned, they are included in non-operating profit to match the corresponding movement in the guarantee liability. As the Group applies US GAAP for the measured value of the product guarantees this item also includes asymmetric impacts where the measurement bases of the liabilities and associated derivatives used to manage the Jackson annuity business differ. The net equity hedge result therefore includes significant accounting mismatches and other factors that do not represent the economic result. These other factors include: - The variable annuity guarantees and fixed index annuity embedded options being only partially fair valued under ‘grandfathered’ US GAAP; - The interest rate exposure being managed through the other than equity-related derivative programme explained in note (b) below; and - Jackson’s management of its economic exposures for a number of other factors that are treated differently in the accounting frameworks such as future fees and assumed volatility levels. The net equity hedge result can be summarised as follows: 2019 £m 2018 £m Half year Half year Fair value movements on equity hedge instruments* (2,466) (375) Accounting value movements on the variable and fixed index annuity guarantee liabilities 227 505 Fee assessments net of claim payments 284 253 Total (1,955) 383 * Held to manage equity exposures of the variable annuity guarantees and fixed index annuity options. (b) Other than equity-related derivatives The fluctuations for this item comprise the net effect of: – – – The free-standing, other than equity-related derivatives, are held to manage interest rate exposures and durations within the general account and the variable annuity guarantees and fixed index annuity embedded options described in note (a) above. Accounting mismatches arise because of differences between the measurement basis and presentation of the derivatives, which are fair valued with movements recorded in the income statement, and the exposures they are intended to manage. (c) Short-term fluctuations related to debt securities 2019 £m 2018 £m Half year Half year (Charges) credits in the period: Losses on sales of impaired and deteriorating bonds (19) (1) Bond write-downs (1) (2) Recoveries/reversals 1 18 Total (charges) credits in the period (19) 15 Risk margin allowance deducted from adjusted IFRS operating profit based on longer-term investment returns* 42 38 23 53 Interest-related realised (losses) gains: Gains (losses) arising in the period 33 8 Amortisation of gains and losses arising in current and prior periods to adjusted IFRS operating profit based on longer-term investment returns (46) (57) (13) (49) Related amortisation of deferred acquisition costs 1 2 Total short-term fluctuations related to debt securities 11 6 * The debt securities of Jackson are held in the general account of the business. Realised gains and losses are recorded in the income statement with normalised returns included in adjusted IFRS operating profit based on longer-term investment returns with variations from period to period included in the short-term fluctuations category. The risk margin reserve charge for longer-term credit-related losses included in adjusted IFRS operating profit based on longer-term investment returns of Jackson for half year 2019 is based on an average annual risk margin reserve of 18 basis points (half year 2018: 19 basis points) on average book values of US$60.0 billion (half year 2018: US$54.9 billion) as shown below: Moody’s rating category Half year 2019 Half year 2018 (or equivalent under Average Average NAIC ratings of book book mortgage-backed value RMR Annual expected loss value RMR Annual expected loss securities) US$m % US$m £m US$m % US$m £m A3 or higher 34,318 0.10 (36) (28) 26,260 0.11 (29) (21) Baa1, 2 or 3 24,385 0.23 (55) (42) 27,337 0.20 (57) (41) Ba1, 2 or 3 1,008 0.93 (10) (7) 978 1.01 (10) (7) B1, 2 or 3 246 2.62 (6) (5) 309 2.61 (8) (6) Below B3 37 3.42 (1) (1) 11 3.71 — — Total 59,994 0.18 (108) (83) 54,895 0.19 (104) (75) Related amortisation of deferred acquisition costs 18 14 22 15 Risk margin reserve charge to adjusted IFRS operating profit for longer-term credit-related losses (90) (69) (82) (60) Consistent with the basis of measurement of insurance assets and liabilities for Jackson’s IFRS results, the charges and credits to adjusted IFRS operating profit based on longer-term investment returns are partially offset by related amortisation of deferred acquisition costs. In addition to the accounting for realised gains and losses described above for Jackson general account debt securities, included within the statement of other comprehensive income is a pre-tax credit of £2,185 million for net unrealised gains on debt securities classified as available-for-sale net of related amortisation of deferred acquisition costs (half year 2018: charge of £(1,149) million for net unrealised losses). Temporary market value movements do not reflect defaults or impairments. Additional details of the movement in the value of the Jackson portfolio are included in note C3.2(c). (iii) Other operations Short-term fluctuations in investment returns for other operations of negative £(23) million (half year 2018: positive £91 million) include unrealised value movements on financial instruments held outside of the main life operations. |
Schedule of average annual risk margin reserve | Moody’s rating category Half year 2019 Half year 2018 (or equivalent under Average Average NAIC ratings of book book mortgage-backed value RMR Annual expected loss value RMR Annual expected loss securities) US$m % US$m £m US$m % US$m £m A3 or higher 34,318 0.10 (36) (28) 26,260 0.11 (29) (21) Baa1, 2 or 3 24,385 0.23 (55) (42) 27,337 0.20 (57) (41) Ba1, 2 or 3 1,008 0.93 (10) (7) 978 1.01 (10) (7) B1, 2 or 3 246 2.62 (6) (5) 309 2.61 (8) (6) Below B3 37 3.42 (1) (1) 11 3.71 — — Total 59,994 0.18 (108) (83) 54,895 0.19 (104) (75) Related amortisation of deferred acquisition costs 18 14 22 15 Risk margin reserve charge to adjusted IFRS operating profit for longer-term credit-related losses (90) (69) (82) (60) |
Schedule of equity-type securities | Half year Half year Equity-type securities such as common and preferred stock and portfolio holdings in mutual funds 6.0 % to 6.7 % 6.7 % to 7.0 % Other equity-type securities such as investments in limited partnerships and private equity funds 8.0 % to 8.7 % 8.7 % to 9.0 % |
Schedule of additional segmental analysis of revenue from continuing operations | Half year 2019 £m - continuing operations Unallocated to a segment Total (central Group Asia US segment operations) total Gross premiums earned 8,856 7,410 16,266 27 16,293 Outward reinsurance premiums (386) (131) (517) (3) (520) Earned premiums, net of reinsurance 8,470 7,279 15,749 24 15,773 Other income note (i) 176 11 187 12 199 Total external revenue 8,646 7,290 15,936 36 15,972 Intra-group revenue 16 24 40 (40) — Interest income 622 1,128 1,750 21 1,771 Other investment return 6,821 16,023 22,844 18 22,862 Total revenue, net of reinsurance note (ii) 16,105 24,465 40,570 35 40,605 Half year 2018* £m - continuing operations Unallocated to a segment Total (central Group Asia US segment operations) total Gross premiums earned 7,736 7,036 14,772 14 14,786 Outward reinsurance premiums (222) (141) (363) — (363) Earned premiums, net of reinsurance 7,514 6,895 14,409 14 14,423 Other income note (i) 157 44 201 14 215 Total external revenue 7,671 6,939 14,610 28 14,638 Intra-group revenue 20 32 52 (52) — Interest income 513 940 1,453 26 1,479 Other investment return (1,703) 1,486 (217) 119 (98) Total revenue, net of reinsurance note(ii) 6,501 9,397 15,898 121 16,019 * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group's UK and Europe operations as discontinued operations at 30 June 2019 (as described in note A2). Notes (i) Other income comprises income from external customers and consists primarily of revenue from the Group’s continuing asset management business of £153 million (half year 2018: £108 million). The remaining other income consists primarily of policy fee revenue from external customers. (ii) Total revenue from continuing operations excludes the contribution from the discontinued UK and Europe operations which are classified as held for distribution at 30 June 2019 (a line-by-line analysis of revenue for the period for the discontinued UK and Europe operations is included in note D2.1). The half year 2018 comparative results have been re-presented from those previously published accordingly (as described in note A2). |
Acquisition costs and other e_2
Acquisition costs and other expenditure from continuing operations (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Acquisition costs and other expenditure from continuing operations | |
Schedule of acquisition costs and other expenditure | 2019 £m 2018* £m Half year Half year Acquisition costs incurred for insurance policies (1,630) (1,538) Acquisition costs deferred less amortisation of acquisition costs note(i) 774 (61) Administration costs and other expenditure note(ii) (1,771) (1,625) Movements in amounts attributable to external unit holders of consolidated investment funds (84) (61) Total acquisition costs and other expenditure from continuing operations (2,711) (3,285) * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group’s UK and Europe operations as discontinued operations at 30 June 2019 (as described in note A2). Notes (i) The components of ‘acquisition costs deferred less amortisation of acquisition costs’ of £774 million in half year 2019 are set out in note C5.2. (ii) Included in total administration costs and other expenditure for half year 2019 is depreciation of property, plant and equipment of £(83) million (half year 2018: £(34) million). Out of the £(83) million of depreciation of property, plant and equipment for half year 2019, £(51) million relates to the right-of-use assets recognised under IFRS 16 adopted in 2019 (as described in note A3). |
Tax charge from continuing op_2
Tax charge from continuing operations (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Tax charge from continuing operations | |
Schedule of total tax charge by nature of expense from continuing operations | 2019 £m 2018* £m Current Deferred Half year Half year Tax charge tax tax Total Total Attributable to shareholders: Asia operations (139) (49) (188) (139) US operations (130) 241 111 (216) Other operations 84 (8) 76 29 Tax (charge) credit attributable to shareholders' returns (185) 184 (1) (326) Attributable to policyholders: Asia operations (54) (166) (220) (43) Total tax (charge) credit (239) 18 (221) (369) * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group’s UK and Europe operations as discontinued operations at 30 June 2019 (as described in note A2). |
Schedule of shareholder profit and tax charge from continuing operations | Half year 2019 £m Total Asia US Other attributable to operations operations operations shareholders Adjusted IFRS operating profit (loss) based on longer-term investment returns 1,198 1,215 (389) 2,024 Non-operating profit (loss) 627 (1,536) (219) (1,128) Profit (loss) before tax 1,825 (321) (608) 896 Tax charge (credit) on: Adjusted IFRS operating profit (loss) based on longer-term investment returns 168 203 (39) 332 Non-operating profit (loss) 20 (314) (37) (331) Total actual tax charge (credit) 188 (111) (76) 1 Actual tax rate on: Adjusted IFRS operating profit based on longer-term investment returns 14 % 17 % 10 % 16 % Profit before tax 10 % 35 % 13 % 0 % Half year 2018* £m Total Asia US Other attributable to operations operations operations shareholders Adjusted IFRS operating profit (loss) based on longer-term investment returns 1,016 1,002 (349) 1,669 Non-operating (loss) profit (338) 184 84 (70) Profit (loss) before tax 678 1,186 (265) 1,599 Tax charge (credit) on: Adjusted IFRS operating profit (loss) based on longer-term investment returns 151 177 (41) 287 Non-operating (loss) profit (12) 39 12 39 Total actual tax charge (credit) 139 216 (29) 326 Actual tax rate on: Adjusted IFRS operating profit based on longer-term investment returns 15 % 18 % 12 % 17 % Profit before tax 21 % 18 % 11 % 20 % * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group’s UK and Europe operations as discontinued operations (as described in note A2). |
Schedule of reconciliation of shareholder effective tax rate from continuing operations | 2019 2018 Half year Half year £m % £m % note (i) note (iv) note (iv) Profit before tax 896 — 1,599 — Expected tax rate (ETR) 20 % — 22 % — Tax at the expected rate 179 20.0 % 352 22.0 % Effects of recurring tax reconciliation items and percentage impact on ETR: Income not taxable or taxable at concessionary rates (54) (6.0) % (19) (1.2) % Deductions not allowable for tax purposes 23 2.6 % 25 1.6 % Items related to taxation of life insurance businesses note (ii) (138) (15.4) % (36) (2.3) % Deferred tax adjustments (9) (1.0) % (17) (1.1) % Effect of results of joint ventures and associates (27) (3.0) % (20) (1.3) % Irrecoverable withholding taxes 21 2.3 % 26 1.8 % Other 4 0.4 % — — Total (180) (20.1) % (41) (2.5) % Effects of non-recurring tax reconciliation items and percentage impact on ETR: Adjustments to tax charge in relation to prior years 15 1.7 % 7 0.4 % Movements in provisions for open tax matters note (iii) 6 0.7 % 8 0.5 % Adjustments in relation to business disposals (19) (2.2) % — — Total 2 0.2 % 15 0.9 % Total actual tax charge 1 0.1 % 326 20.4 % Notes (i) The main driver of the Group’s effective tax rate is the relative mix of the profits between jurisdictions with higher tax rates (such as Indonesia and Malaysia), jurisdictions with lower tax rates (such as Hong Kong and Singapore) and jurisdictions with rates in between (such as the UK and the US). At half year 2019, the reduction in the effective tax rate is a result of the loss before tax in US operations. (ii) The £138 million reconciling item related to taxation of life insurance businesses for half year 2019 (half year 2018: £36 million) mainly reflects £82 million in the Hong Kong business in relation to investment gains which are not subject to tax due to the taxable profit being computed as 5 per cent of net insurance premiums. (iii) The statement of financial position contains the following provisions in relation to open tax matters: £m At 31 December 2018 (149) Movements in the current period included in tax charge attributable to shareholders (6) Other movements* (1) At 30 June 2019 (156) * Other movements include interest arising on open tax matters and amounts included in the Group’s share of profits from joint ventures and associates, net of related tax. (iv) The Group’s UK and Europe operations are classified as held for distribution at 30 June 2019. The half year 2018 comparative results have been re-presented from those previously published accordingly (as described in note A2). |
Schedule of movements in provisions for open tax matters | £m At 31 December 2018 (149) Movements in the current period included in tax charge attributable to shareholders (6) Other movements* (1) At 30 June 2019 (156) * Other movements include interest arising on open tax matters and amounts included in the Group’s share of profits from joint ventures and associates, net of related tax. |
Earnings per share (Tables)
Earnings per share (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Earnings per share | |
Schedule of earnings per share | Half year 2019 Net of tax and Basic Diluted Non- controlling non- controlling earnings earnings Before tax Tax interests interests per share per share £m £m £m £m pence pence Note B1.1 B4 Based on adjusted IFRS operating profit based on longer-term investment returns 2,024 (332) (5) 1,687 65.3 p 65.3 p Short-term fluctuations in investment returns on shareholder-backed business B1.2 (1,124) 314 — (810) (31.4) p (31.4) p Amortisation of acquisition accounting adjustments (17) 3 — (14) (0.5) p (0.5) p Gain (loss) on disposal of businesses and corporate transactions 13 14 — 27 1.0 p 1.0 p Based on profit for the period from continuing operations 896 (1) (5) 890 34.4 p 34.4 p Based on profit for the period from discontinued operations D2.1 817 (172) — 645 25.0 p 25.0 p Based on profit for the period 1,713 (173) (5) 1,535 59.4 p 59.4 p Half year 2018* Net of tax and Basic Diluted Non- controlling non- controlling earnings earnings Before tax Tax interests interests per share per share £m £m £m £m pence pence Note B1.1 B4 Based on adjusted IFRS operating profit based on longer-term investment returns 1,669 (287) (1) 1,381 53.7 p 53.6 p Short-term fluctuations in investment returns on shareholder-backed business B1.2 9 (51) — (42) (1.6) p (1.6) p Amortisation of acquisition accounting adjustments (22) 4 — (18) (0.7) p (0.7) p Gain (loss) on disposal of businesses and corporate transactions (57) 8 — (49) (1.9) p (1.9) p Based on profit for the period from continuing operations 1,599 (326) (1) 1,272 49.5 p 49.4 p Based on profit for the period from discontinued operations D2.1 101 (18) — 83 3.2 p 3.2 p Based on profit for the period 1,700 (344) (1) 1,355 52.7 p 52.6 p * The half year 2018 comparative results have been re-presented from those previously published to reflect the Group’s UK and Europe operations as discontinued operations at 30 June 2019 (as described in note A2). |
Summary of weighted average number of shares for calculating earnings per share | Weighted average number (in millions) of shares for calculation of: Half year Half year Basic earnings per share 2,583 2,573 Diluted earnings per share 2,584 2,574 |
Dividends (Tables)
Dividends (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Dividends | |
Schedule of dividends | Half year 2019 Half year 2018 Pence per share £m Pence per share £m Dividends relating to reporting period: First interim ordinary dividend 16.45 p 428 15.67 p 406 Dividends paid in reporting period: Second interim ordinary dividend for prior year 33.68 p 870 32.50 p 840 |
Analysis of Group statement o_2
Analysis of Group statement of financial position by segment (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Analysis of Group statement of financial position by segment | |
Schedule of financial position by segment | 30 Jun 2019 £m 2018 £m Before elimination of intra-group debtors and creditors Elimination of intra- Unallocated Discontinued group to a segment Total UK and debtors 31 Dec (central continuing Europe and Group Group Asia US operations) operations operations creditors Total Total By operating segment Note C2.1 C2.2 note (i) note (v) note (v) Assets Goodwill C5.1 510 — — 510 — — 510 1,857 Deferred acquisition costs and other intangible assets C5.2 3,624 8,990 45 12,659 — — 12,659 11,923 Reinsurers' share of insurance contract liabilities note (ii) 3,621 6,527 3 10,151 — — 10,151 11,144 Other assets note (iii) 4,319 3,908 2,525 10,752 — (3,491) 7,261 11,459 Investment properties 5 6 — 11 — — 11 17,925 Investment in joint ventures and associates accounted for using the equity method 1,030 — — 1,030 — — 1,030 1,733 Financial investments 93,476 203,898 2,155 299,529 — — 299,529 429,901 Assets held for distribution D2.2 — — — — 221,126 (2,802) 218,324 — Assets held for sale — — — — — — — 10,578 Cash and cash equivalents 2,222 1,184 1,802 5,208 — — 5,208 12,125 Total assets 108,807 224,513 6,530 339,850 221,126 (6,293) 554,683 508,645 Total equity 7,656 6,752 (2,993) 11,415 8,280 — 19,695 17,267 Liabilities Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) C4.1(i) 84,077 202,152 47 286,276 — (1,108) 285,168 409,301 Unallocated surplus of with-profits funds C4.1(i) 3,034 — — 3,034 — (90) 2,944 15,845 Core structural borrowings of shareholder-financed businesses C6.1 — 196 7,245 7,441 — — 7,441 7,664 Operational borrowings attributable to shareholder-financed businesses C6.2(i) 137 800 727 1,664 — — 1,664 998 Borrowings attributable to with-profits businesses C6.2(ii) 238 — — 238 — — 238 3,940 Other liabilities note (iv) 13,665 14,613 1,504 29,782 — (3,636) 26,146 43,062 Liabilities held for distribution D2.2 — — — — 212,846 (1,459) 211,387 — Liabilities held for sale — — — — — — — 10,568 Total liabilities 101,151 217,761 9,523 328,435 212,846 (6,293) 534,988 491,378 Total equity and liabilities 108,807 224,513 6,530 339,850 221,126 (6,293) 554,683 508,645 Notes (i) Unallocated to a segment includes central operations, the Group’s existing treasury company, Prudential Capital, and Africa operations as per note B1.3. (ii) Reinsurers’ share of contract liabilities of £10,151 million at 30 June 2019 includes the reinsurance ceded in respect of the acquired REALIC business by the Group’s US insurance operations. In addition to this REALIC reinsurance, the balances in 2018 also included the reinsurance of part of the UK shareholder-backed annuity portfolio. (iii) ‘Other assets’ at 30 June 2019 included property, plant and equipment of £785 million relating to continuing operations (31 December 2018: £1,409 million, of which £378 million related to continuing operations). On 1 January 2019, £414 million of right-of-use assets was recognised for continuing operations upon adoption of IFRS 16 (see note A3). During the period, the Group made additions of £82 million for continuing operations of which £66 million relates to right-of-use assets. Contained within ‘Other assets’ is premiums receivable of £564 million, of which 91 per cent are due within one year (31 December 2018: premiums receivable for total continuing and discontinued operations of £672 million, of which 73 per cent are due within one year. (iv) Within ’Other liabilities’ at 30 June 2019 is accruals, deferred income and other liabilities of £10,597 million for continuing operations (31 December 2018: £15,248 million for continuing and discontinued operations), of which £6,722 million (31 December 2018: £9,968 million) are due within one year. (v) Assets and liabilities held for distribution relate to the Group’s UK and Europe operations classified as discontinued operations at 30 June 2019. A line-by-line analysis of assets and liabilities for the discontinued UK and Europe operations (before elimination of intra-group balances with continuing operations) is included in note D2.2). The 2018 comparative results for the assets and liabilities at 31 December 2018 are as published and not restated (as described in note A2). |
Analysis of segment statement_2
Analysis of segment statement of financial position by business type (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Asia | |
Analysis of operating segments | |
Schedule of segment statement of financial position by business type | 30 Jun 2019 £m 2018 £m Total insurance Unit -linked With assets Asset- -profits and Other manage Elimina- 31 Dec Note business* liabilities business Total ment tions Total Total Assets Goodwill — — 252 252 258 — 510 498 Deferred acquisition costs and other intangible assets 58 — 3,554 3,612 12 — 3,624 2,937 Reinsurers' share of insurance contract liabilities 83 — 3,538 3,621 — — 3,621 2,777 Other assets 2,526 315 1,357 4,198 156 (35) 4,319 3,916 Investment properties — — 5 5 — — 5 5 Investment in joint ventures and associates accounted for using the equity method — — 859 859 171 — 1,030 991 Financial investments 54,687 18,492 20,134 93,313 163 — 93,476 80,886 Cash and cash equivalents 534 400 1,179 2,113 109 — 2,222 2,189 Total assets 57,888 19,207 30,878 107,973 869 (35) 108,807 94,199 Total equity — — 7,077 7,077 579 — 7,656 6,428 Liabilities Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) C4.2 48,041 17,594 18,442 84,077 — — 84,077 73,216 Unallocated surplus of with-profits funds C4.2 3,034 — — 3,034 — — 3,034 2,511 Operational borrowings attributable to shareholder-financed businesses — 36 88 124 13 — 137 61 Borrowings attributable to with-profits businesses 238 — — 238 — — 238 19 Other liabilities 6,575 1,577 5,271 13,423 277 (35) 13,665 11,964 Total liabilities 57,888 19,207 23,801 100,896 290 (35) 101,151 87,771 Total equity and liabilities 57,888 19,207 30,878 107,973 869 (35) 108,807 94,199 * The statement of financial position for with-profits business comprises the with-profits assets and liabilities of the Hong Kong, Malaysia and Singapore operations. ‘Other business’ includes assets and liabilities of other participating businesses and other non-linked shareholder-backed business. |
US | |
Analysis of operating segments | |
Schedule of segment statement of financial position by business type | 30 Jun 2019 £m 2018 £m Total insurance Variable annuity separate Fixed account annuity, assets GICs and Asset and other manage- Elimina- 31 Dec Note liabilities business Total ment tions Total Total Assets Goodwill — — — — — — — Deferred acquisition costs and other intangible assets — 8,990 8,990 — — 8,990 8,747 Reinsurers' share of insurance contract liabilities — 6,527 6,527 — — 6,527 6,662 Other assets — 3,834 3,834 143 (69) 3,908 3,588 Investment properties — 6 6 — — 6 6 Financial investments 145,295 58,585 203,880 18 — 203,898 182,910 Cash and cash equivalents — 1,130 1,130 54 — 1,184 3,005 Total assets 145,295 79,072 224,367 215 (69) 224,513 204,918 Total equity — 6,702 6,702 50 — 6,752 5,624 Liabilities Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) C4.3 145,295 56,857 202,152 — — 202,152 185,600 Core structural borrowings of shareholder-financed businesses — 196 196 — — 196 196 Operational borrowings attributable to shareholder-financed businesses — 767 767 33 — 800 328 Other liabilities — 14,550 14,550 132 (69) 14,613 13,170 Total liabilities 145,295 72,370 217,665 165 (69) 217,761 199,294 Total equity and liabilities 145,295 79,072 224,367 215 (69) 224,513 204,918 |
Group assets and liabilities _2
Group assets and liabilities - measurement (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Financial instruments | |
Schedule of reconciliation of movements in level 3 financial instruments measured at fair value | Half year 2019 £m Net asset value attributable Equity to unit securities Other Borrowings holders of and investments attributable consolidated portfolio (including to with- unit trusts Other Reconciliation of movements in level 3 assets holdings in Debt derivative Derivative profits and similar financial and liabilities measured at fair value Loans unit trusts securities assets) liabilities businesses funds liabilities Total At 1 January 2019 4,753 515 1,182 5,272 (423) (1,606) (988) (3,404) 5,301 Reclassification to held for distribution (1,970) (345) (1,177) (4,333) — 1,606 988 355 (4,876) Total gains (losses) in income statement: Net realised gains (losses) 91 — 5 (25) — — — (94) (23) Net unrealised gains (losses) on financial instruments held at the end of period — (2) — 40 (15) — — (14) 9 Total gains (losses) recorded in other comprehensive income 4 — 1 (5) (17) — — (11) (28) Purchases — 2 — 127 — — — — 129 Sales — — (5) (114) — — — — (119) Issues 26 — — — — — — (35) (9) Settlements (105) — — — — — — 122 17 At 30 June 2019 2,799 170 6 962 (455) — — (3,081) 401 Full year 2018 £m Net asset value attributable Equity to unit securities Other Borrowings holders of and investments attributable consolidated portfolio (including to with- unit trusts Other Reconciliation of movements in level 3 assets holdings in Debt derivative Derivative profits and similar financial and liabilities measured at fair value Loans unit trusts securities assets) liabilities businesses funds liabilities Total At 1 January 2018 4,837 371 654 4,424 (512) (1,887) (413) (3,031) 4,443 Total gains (losses) in income statement: Net realised gains (losses) (7) — 9 35 — — — (1) 36 Net unrealised gains (losses) on financial instruments held at the end of the year (71) 38 (16) 370 27 (23) 67 6 398 Total gains (losses) recorded in other comprehensive income 162 8 — 54 (1) — 31 (170) 84 Purchases 62 125 666 1,202 — — — — 2,055 Sales (178) (35) (131) (813) — — — — (1,157) Issues 279 — — — — — (697) (481) (899) Settlements (331) — — — — 304 57 273 303 Transfers into level 3 — 8 — — — — — — 8 Transfers out of level 3 — — — — 63 — (33) — 30 At 31 December 2018 4,753 515 1,182 5,272 (423) (1,606) (988) (3,404) 5,301 * Includes distributions to third-party investors by subsidiaries held by the UK with-profits funds for investment purposes. These distributions vary period to period depending on the maturity of the subsidiaries and the gains realised by those entities in the period. |
At fair value | |
Financial instruments | |
Schedule of fair value of assets and liabilities | 30 Jun 2019 £m Level 1 Level 2 Level 3 Valuation Valuation Quoted prices based on based on (unadjusted) significant significant Analysis of financial investments, net of derivative liabilities in active observable unobservable by business type from continuing operations markets market inputs market inputs Total With-profits Loans — — — — Equity securities and portfolio holdings in unit trusts 19,318 1,906 153 21,377 Debt securities 28,964 3,093 6 32,063 Other investments (including derivative assets) 107 81 — 188 Derivative liabilities (34) (11) — (45) Total financial investments, net of derivative liabilities 48,355 5,069 159 53,583 Percentage of total (%) 90 % 10 % 0 % 100 % Unit-linked and variable annuity separate account Equity securities and portfolio holdings in unit trusts 159,462 230 — 159,692 Debt securities 2,840 763 — 3,603 Other investments (including derivative assets) — — — — Derivative liabilities (11) (6) — (17) Total financial investments, net of derivative liabilities 162,291 987 — 163,278 Percentage of total (%) 99 % 1 % 0 % 100 % Non-linked shareholder-backed Loans — — 2,799 2,799 Equity securities and portfolio holdings in unit trusts 2,580 4 17 2,601 Debt securities 16,726 47,283 — 64,009 Other investments (including derivative assets) 42 988 962 1,992 Derivative liabilities (7) (513) (455) (975) Total financial investments, net of derivative liabilities 19,341 47,762 3,323 70,426 Percentage of total (%) 27 % 68 % 5 % 100 % Group total analysis, including other financial liabilities held at fair value from continuing operations Loans — — 2,799 2,799 Equity securities and portfolio holdings in unit trusts 181,360 2,140 170 183,670 Debt securities 48,530 51,139 6 99,675 Other investments (including derivative assets) 149 1,069 962 2,180 Derivative liabilities (52) (530) (455) (1,037) Total financial investments, net of derivative liabilities 229,987 53,818 3,482 287,287 Investment contract liabilities without discretionary participation features held at fair value — (666) — (666) Net asset value attributable to unit holders of consolidated unit trusts and similar funds (3,482) — — (3,482) Other financial liabilities held at fair value — (5) (3,081) (3,086) Total financial instruments at fair value 226,505 53,147 401 280,053 Percentage of total (%) 81 % 19 % 0 % 100 % 31 Dec 2018 £m Level 1 Level 2 Level 3 Valuation Valuation Quoted prices based on based on (unadjusted) significant significant Analysis of financial investments, net of derivative in active observable unobservable liabilities by business type markets market inputs market inputs Total With-profits Loans — — 1,703 1,703 Equity securities and portfolio holdings in unit trusts 52,320 5,447 488 58,255 Debt securities 31,210 48,981 811 81,002 Other investments (including derivative assets) 143 3,263 4,325 7,731 Derivative liabilities (85) (1,231) — (1,316) Total financial investments, net of derivative liabilities 83,588 56,460 7,327 147,375 Percentage of total (%) 57 % 38 % 5 % 100 % Unit-linked and variable annuity separate account Equity securities and portfolio holdings in unit trusts 152,987 505 9 153,501 Debt securities 4,766 9,727 — 14,493 Other investments (including derivative assets) 6 3 6 15 Derivative liabilities (2) (3) — (5) Total financial investments, net of derivative liabilities 157,757 10,232 15 168,004 Percentage of total (%) 94 % 6 % 0 % 100 % Non-linked shareholder-backed Loans — — 3,050 3,050 Equity securities and portfolio holdings in unit trusts 2,957 2 18 2,977 Debt securities 17,687 61,803 371 79,861 Other investments (including derivative assets) 61 1,258 941 2,260 Derivative liabilities (2) (1,760) (423) (2,185) Total financial investments, net of derivative liabilities 20,703 61,303 3,957 85,963 Percentage of total (%) 24 % 71 % 5 % 100 % Group total analysis, including other financial liabilities held at fair value Loans — — 4,753 4,753 Equity securities and portfolio holdings in unit trusts 208,264 5,954 515 214,733 Debt securities 53,663 120,511 1,182 175,356 Other investments (including derivative assets) 210 4,524 5,272 10,006 Derivative liabilities (89) (2,994) (423) (3,506) Total financial investments, net of derivative liabilities 262,048 127,995 11,299 401,342 Investment contract liabilities without discretionary participation features held at fair value — (16,054) — (16,054) Borrowings attributable to with-profits businesses — — (1,606) (1,606) Net asset value attributable to unit holders of consolidated unit trusts and similar funds (6,852) (3,811) (988) (11,651) Other financial liabilities held at fair value — (2) (3,404) (3,406) Total financial instruments at fair value 255,196 108,128 5,301 368,625 Percentage of total (%) 70 % 29 % 1 % 100 % Analysed as: Total from continuing operations With-profits 39,191 3,928 159 43,278 Unit-linked and variable annuity separate account 143,556 (64) — 143,492 Non-linked shareholder-backed 16,549 43,948 266 60,763 199,296 47,812 425 247,533 Percentage of total continuing operations (%) 81 % 19 % 0 % 100 % Total from discontinued UK and Europe operations* 55,900 60,316 4,876 121,092 Percentage of total discontinued operations (%) 46 % 50 % 4 % 100 % * Classified as discontinued operations at 30 June 2019 (as described in note A2). |
Fair value of instruments not measured at fair value | |
Financial instruments | |
Schedule of fair value of assets and liabilities | The table below shows the financial assets and liabilities carried at amortised cost on the statement of financial position and their fair value, excluding those held for distribution. Cash deposits, accrued income, other debtors, accruals, deferred income and other liabilities are excluded from the analysis below, as these are carried at amortised cost, which approximates fair value. 2019 £m 2018 £m 30 Jun 31 Dec Carrying Fair Carrying Fair value value value value Assets Loans 9,714 10,010 13,257 13,666 Liabilities Investment contract liabilities without discretionary participation features (3,132) (3,140) (3,168) (3,157) Core structural borrowings of shareholder-financed businesses (7,441) (8,052) (7,664) (7,847) Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses (1,435) (1,435) (998) (998) Borrowings (excluding lease liabilities) attributable to the with-profits funds (25) (24) (2,334) (2,103) Obligations under funding, securities lending and sale and repurchase agreements (6,756) (6,890) (6,989) (7,008) Total financial instruments carried at amortised cost (9,075) (9,531) (7,896) (7,447) Analysed as: Total from continuing operations (7,848) (8,040) Total from discontinued UK and Europe operations* (48) 593 (7,896) (7,447) * Classified as discontinued operations at 30 June 2019 (as described in note A2). |
Debt securities (Tables)
Debt securities (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Debt securities | |
Financial investments | |
Schedule of securities analysed according to external credit ratings | 30 Jun 2019 £m Other BBB+ (including AAA AA+ to AA- A+ to A- to BBB- Below BBB- NAIC rated) Total Asia With-profits 3,131 14,977 4,688 4,621 2,016 2,630 32,063 Unit-linked 405 196 458 1,502 378 664 3,603 Non-linked shareholder-backed 1,072 4,155 4,458 3,287 2,493 1,371 16,836 Asset management 12 — 37 — — — 49 US Non-linked shareholder-backed 1,189 7,984 11,527 15,068 1,579 7,917 45,264 Other operations 510 1,144 129 20 50 7 1,860 Total debt securities 6,319 28,456 21,297 24,498 6,516 12,589 99,675 31 Dec 2018 £m Other BBB+ (including AAA AA+ to AA- A+ to A- to BBB- Below BBB- NAIC rated) Total Asia With-profits 2,873 12,379 4,142 3,760 1,747 2,303 27,204 Unit-linked 817 100 492 1,431 426 715 3,981 Non-linked shareholder-backed 1,034 3,552 3,717 2,934 2,202 1,144 14,583 Asset management 11 — 60 — — — 71 US Non-linked shareholder-backed 678 7,383 10,286 14,657 1,429 7,161 41,594 Other operations 619 1,089 151 41 49 18 1,967 Total continuing operations 6,032 24,503 18,848 22,823 5,853 11,341 89,400 Total discontinued UK and Europe operations* 10,938 18,204 18,645 19,728 3,444 14,997 85,956 Total debt securities 16,970 42,707 37,493 42,551 9,297 26,338 175,356 * Classified as discontinued operations at 30 June 2019 (as described in note A2). |
Schedule of securities with credit ratings classified as "Other" | 2019 £m 2018 £m Asia 30 Jun 31 Dec Government bonds 37 36 Corporate bonds - rated as investment grade by local external ratings agencies 1,215 978 Other 119 130 Total Asia non-linked shareholder-backed other debt securities 1,371 1,144 2019 £m 2018 £m Mortgage -backed Other US securities securities 30 Jun 31 Dec Implicit ratings of other US debt securities based on NAIC* valuations (see below) NAIC 1 2,184 3,337 5,521 5,006 NAIC 2 — 2,357 2,357 2,118 NAIC 3-6 3 36 39 37 Total US other debt securities † 2,187 5,730 7,917 7,161 * The Securities Valuation Office of the NAIC classifies debt securities into six quality categories ranging from Class 1 (the highest) to Class 6 (the lowest). Performing securities are designated as Classes 1 to 5 and securities in or near default are designated Class 6. † Mortgage-backed securities totalling £2,003 million at 30 June 2019 have credit ratings issued by Standard & Poor’s of BBB- or above and hence are designated as investment grade. Other securities totalling £5,694 million at 30 June 2019 with NAIC ratings 1 or 2 are also designated as investment grade. |
Debt securities | Jackson (US insurance operations) | |
Financial investments | |
Schedule of additional analysis of securities | 2019 £m 2018 £m 30 Jun 31 Dec Corporate and government security and commercial loans: Government 6,094 5,465 Publicly traded and SEC Rule 144A securities* 27,419 26,196 Non-SEC Rule 144A securities 7,293 6,329 Asset backed securities (see note (e)) 4,458 3,604 Total US debt securities † 45,264 41,594 * A 1990 SEC rule that facilitates the resale of privately placed securities under Rule 144A that are without SEC registration to qualified institutional investors. The rule was designed to develop a more liquid and efficient institutional resale market for unregistered securities. † Debt securities for US operations included in the statement of financial position comprise: 2019 £m 2018 £m 30 Jun 31 Dec Available-for-sale 44,178 40,849 Fair value through profit and loss 1,086 745 45,264 41,594 |
Schedule of movements in unrealised gains and losses on available-for-sale securities | Foreign Changes in exchange unrealised 30 Jun 2019 £m translation † appreciation 31 Dec 2018 £m Reflected as part of movement in other Assets fair valued at below book value Book value* 2,339 25,330 Unrealised gain (loss) (49) 14 862 (925) Fair value (as included in statement of financial position) 2,290 24,405 Assets fair valued at or above book value Book value* 39,592 15,933 Unrealised gain (loss) 2,296 30 1,755 511 Fair value (as included in statement of financial position) 41,888 16,444 Total Book value* 41,931 41,263 Net unrealised gain (loss) 2,247 44 2,617 (414) Fair value (as included in the footnote above in the overview table and the statement of financial position) 44,178 40,849 * Book value represents cost/amortised cost of the debt securities. † Translated at the average rate of US$1.2939: £1.00. |
Schedule of securities classified as available-for-sale in an unrealised loss position | (i) Fair value of securities as a percentage of book value The following table shows the fair value of the debt securities in a gross unrealised loss position for various percentages of book value: 30 Jun 2019 £m 31 Dec 2018 £m Fair Unrealised Fair Unrealised Between 90% and 100% 2,221 (32) 23,662 (809) Between 80% and 90% 38 (5) 707 (104) Below 80% 31 (12) 36 (12) Total 2,290 (49) 24,405 (925) (ii) Unrealised losses by maturity of security 2019 £m 2018 £m 30 Jun 31 Dec 1 year to 5 years (2) (72) 5 years to 10 years (10) (436) More than 10 years (19) (372) Mortgage-backed and other debt securities (18) (45) Total (49) (925) (iii) Age analysis of unrealised losses for the periods indicated The following table shows the age analysis of all the unrealised losses in the portfolio by reference to the length of time the securities have been in an unrealised loss position: 30 Jun 2019 £m 31 Dec 2018 £m Non- Non- investment Investment investment Investment Age analysis grade grade * Total grade grade * Total Less than 6 months (1) (4) (5) (20) (141) (161) 6 months to 1 year (1) (13) (14) (22) (440) (462) 1 year to 2 years (1) (9) (10) (10) (142) (152) 2 years to 3 years — (10) (10) — (123) (123) More than 3 years — (10) (10) (2) (25) (27) (3) (46) (49) (54) (871) (925) * For Standard and Poor, Moody’s and Fitch rated debt securities, those with ratings range from AAA to BBB- are designated as investment grade. For NAIC rated debt securities, those with ratings 1 or 2 are designated as investment grade. Further, the following table shows the age analysis of the securities whose fair values were below 80 per cent of the book value: 30 Jun 2019 £m 31 Dec 2018 £m Fair Unrealised Fair Unrealised Age analysis value loss value loss Less than 3 months 26 (10) 32 (10) 3 months to 6 months 5 (2) 2 (1) More than 6 months — — 2 (1) 31 (12) 36 (12) |
Asset-backed securities | |
Financial investments | |
Schedule of additional analysis of securities | The Group’s holdings in asset-backed securities (ABS), which comprise residential mortgage-backed securities (RMBS), commercial mortgage-backed securities (CMBS), collateralised debt obligations (CDO) funds and other asset-backed securities, at 30 June 2019 are as follows: 2019 £m 2018 £m 30 Jun 31 Dec Asia operations: note (i) Shareholder-backed business 126 121 With-profits business 256 235 US operations note (ii) 4,458 3,604 Other operations note (iii) 315 445 Total for continuing operations 5,155 4,405 Total for discontinued UK and Europe operations* 6,676 Group total 11,081 * Classified as discontinued operations at 30 June 2019 (as described in note A2). Notes (i) The Asia operations' exposure to asset-backed securities for the shareholder-backed business and with-profits business at 30 June 2019, is 100 per cent (31 December 2018: 99.8 per cent) investment grade. (ii) US operations’ exposure to asset-backed securities comprises: 2019 £m 2018 £m 30 Jun 31 Dec RMBS Sub-prime (30 Jun 2019: 2% AAA, 5% AA, 2% A) 88 96 Alt-A (30 Jun 2019: 17% AAA, 34% A) 101 105 Prime including agency (2019: 39% AAA, 45 % AA, 7% A) 579 441 CMBS (30 Jun 2019: 78% AAA, 16% AA, 3% A) 2,266 1,945 CDO funds (30 Jun 2019: 37% AAA, 33% AA, 30% A), including £nil exposure to sub-prime 353 13 Other ABS (30 Jun 2019: 15% AAA, 16% AA, 52% A), including £59 million exposure to sub-prime 1,071 1,004 Total (30 Jun 2019: 52% AAA, 21% AA, 18% A) 4,458 3,604 (iii) Other operations’ exposure to asset-backed securities is held by Prudential Capital with no sub-prime exposure. Of the £315 million held at 30 June 2019, 100 per cent (31 December 2018: 99 per cent) are graded AAA. |
Sovereign debt | |
Financial investments | |
Schedule of additional analysis of securities | 30 Jun 2019 £m 31 Dec 2018 £m Shareholder- With- Shareholder- With- backed profits backed profits business funds business funds Total Eurozone — — 378 440 United Kingdom 988 — 3,226 3,013 United States* 6,410 12,925 5,647 11,858 Indonesia 295 — 282 — Singapore 132 1,719 164 1,658 Thailand 1,106 — 921 — Vietnam 1,186 — 1,871 — Other Asia 1,925 944 1,779 866 Other 98 25 125 221 Total 12,140 15,613 14,393 18,056 Analysed as: Total from continuing operations 11,658 13,144 Total from discontinued UK and Europe operations † 2,735 4,912 14,393 18,056 * The exposure to the United States sovereign debt comprises holdings of the US and Asia insurance operations. † Classified as discontinued operations at 30 June 2019 (as described in note A2). |
Bank debt securities | |
Financial investments | |
Schedule of additional analysis of securities | 30 Jun 2019 £m 2018 £m Senior debt Subordinated debt 31 Dec Shareholder-backed business Total Tier 1 Tier 2 Total Group total Group total Spain 70 — — — 70 106 France 142 — 9 9 151 156 Germany 30 — 12 12 42 125 Netherlands 56 — 3 3 59 73 Other Eurozone — — — — — 17 Total Eurozone 298 — 24 24 322 477 United Kingdom 598 8 95 103 701 1,346 United States 2,354 1 31 32 2,386 2,667 Asia 248 114 312 426 674 592 Other 470 — 75 75 545 645 Total 3,968 123 537 660 4,628 5,727 Analysed as: Total from continuing operations 4,640 Total from discontinued UK and Europe operations* 1,087 5,727 With-profits funds Italy — — — — — 38 Spain 2 — — — 2 17 France 7 — 27 27 34 352 Germany — — 47 47 47 229 Netherlands 8 — 10 10 18 266 Other Eurozone — — — — — 74 Total Eurozone 17 — 84 84 101 976 United Kingdom 31 2 82 84 115 2,194 United States 16 1 3 4 20 2,730 Asia 279 363 299 662 941 1,015 Other 59 — 142 142 201 1,810 Total 402 366 610 976 1,378 8,725 Analysed as: Total from continuing operations 1,287 Total from discontinued UK and Europe operations* 7,438 8,725 * Classified as discontinued operations at 30 June 2019 (as described in note A2). |
Loans portfolio (Tables)
Loans portfolio (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Loans | |
Financial investments | |
Schedule of amounts included in the statement of financial position | 30 Jun 2019 £m 31 Dec 2018 £m Mortgage loans Policy loans Other loans Total Mortgage loans Policy loans Other loans Total note (i) note (ii) note (i) note (ii) Asia With-profits — 783 63 846 — 727 65 792 Non-linked shareholder-backed 140 233 15 388 156 226 203 585 US Non-linked shareholder-backed 7,587 3,686 — 11,273 7,385 3,681 — 11,066 Other operations — — 6 6 — — — — Total continuing operations 7,727 4,702 84 12,513 7,541 4,634 268 12,443 Total discontinued UK and Europe operations note (iii) 4,116 3 1,448 5,567 Total loans securities 11,657 4,637 1,716 18,010 Notes (i) All mortgage loans are secured by properties. (ii) In the US, £2,799 million of policy loans held at 30 June 2019 (31 December 2018: £2,783 million) are backing liabilities for funds withheld under reinsurance arrangements and are accounted for at fair value through profit or loss. All other policy loans are accounted for at amortised cost, less any impairment. (iii) The amounts held by the UK and Europe operations were transferred to assets held for distribution at 30 June 2019 (see note D2.2). |
Policyholder liabilities and _2
Policyholder liabilities and unallocated surplus (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Policyholder liabilities and unallocated surplus | |
Analysis of movements in policyholder liabilities and unallocated surplus of with-profits funds | Half year 2019 £m UK and Asia US Europe Total note C4.2 note C4.3 note D2.2 At 1 January 2019 82,763 185,600 164,889 433,252 Comprising: - Policyholder liabilities on the consolidated statement of financial position (excludes £39 million classified as unallocated to a segment) note (a) 72,107 185,600 151,555 409,262 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 2,511 — 13,334 15,845 - Group's share of policyholder liabilities of joint ventures and associate note(b) 8,145 — — 8,145 Reclassification of UK and Europe liabilities as held for distribution — — (164,889) (164,889) Net flows: Premiums 7,574 7,060 — 14,634 Surrenders (1,531) (6,398) — (7,929) Maturities/deaths (989) (1,348) — (2,337) Net flows 5,054 (686) — 4,368 Shareholders' transfers post tax (38) — — (38) Investment-related items and other movements 6,142 16,838 — 22,980 Foreign exchange translation differences 676 400 — 1,076 At 30 June 2019 94,597 202,152 — 296,749 Comprising: - Policyholder liabilities on the consolidated statement of financial position 82,969 202,152 — 285,121 (excludes £47 million classified as unallocated to a segment) note (a) - Unallocated surplus of with-profits funds on the consolidated statement of financial position 2,944 — — 2,944 - Group's share of policyholder liabilities of joint ventures and associate note (b) 8,684 — — 8,684 Half year 2018 £m UK and Asia US Europe Total note C4.2 note C4.3 note D2.2 At 1 January 2018 73,839 180,724 181,066 435,629 Comprising: - Policyholder liabilities on the consolidated statement of financial position (excludes £32 million classified as unallocated to a segment) 62,898 180,724 167,589 411,211 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 3,474 — 13,477 16,951 - Group's share of policyholder liabilities of joint ventures and associate note (b) 7,467 — — 7,467 Reclassification of reinsured UK annuity contracts as held for sale — — (12,002) (12,002) Net flows: Premiums 6,247 7,111 6,964 20,322 Surrenders (1,547) (5,953) (3,446) (10,946) Maturities/deaths (838) (1,076) (3,499) (5,413) Net flows 3,862 82 19 3,963 Shareholders' transfers post tax (27) — (127) (154) Investment-related items and other movements (1,349) (103) (801) (2,253) Foreign exchange translation differences 690 4,447 17 5,154 At 30 June 2018 77,015 185,150 168,172 430,337 Comprising: - Policyholder liabilities on the consolidated statement of financial position 65,640 185,150 154,655 405,445 (excludes £37 million classified as unallocated to a segment) note (a) - Unallocated surplus of with-profits funds on the consolidated statement of financial position 3,766 — 13,517 17,283 - Group's share of policyholder liabilities of joint ventures and associate note (b) 7,609 — — 7,609 Average policyholder liability balances note (c) Half year 2019 85,953 193,876 — 279,829 Half year 2018 71,807 182,937 161,122 415,866 Notes (a) The policyholder liabilities of the Asia insurance operations at 30 June 2019 of £82,969 million (30 June 2018: £65,640 million) are after deducting the intra-group reinsurance liabilities ceded by the UK and Europe insurance operations of £1,108 million (30 June 2018: £1,181 million) to the Hong Kong with-profits business. Including this amount, total Asia policyholder liabilities are £84,077 million (30 June 2018: £66,821 million). (b) The Group’s investment in joint ventures and associate are accounted for on an equity method basis in the Group’s statement of financial position. The Group’s share of the policyholder liabilities as shown above relates to life businesses in China, India and of the Takaful business in Malaysia. (c) Averages have been based on opening and closing balances, adjusted for acquisitions, disposals and corporate transactions arising in the period, and exclude unallocated surplus of with-profits funds. |
Schedule of movement in insurance contract liabilities and unallocated surplus of with-profit funds | Reinsurer's share of insurance Unallocated surplus Contract liabilities contract liabilities of with-profits funds £m £m £m At 1 January 2019 409,301 (11,144) 15,845 Removal of opening balances relating to the discontinued UK and Europe insurance operations note (a) (151,555) 1,703 (13,334) Income and expense included in the income statement 26,274 (680) 506 Other movements note (b) 41 — (90) Foreign exchange translation differences 1,107 (30) 17 At 30 June 2019 285,168 (10,151) 2,944 Notes (a) The balances of the discontinued UK and Europe operations are removed from the opening balances to show the underlying movement from continuing operations (as described in note A2). The £1,703 million of reinsurer’s share of insurance contract liabilities in the table above excluded the intra-group reinsurance assets of £1,109 million for the with-profits business ceded to the Asia insurance operations, which were eliminated on consolidation at 1 January 2019. An analysis of the movement in policyholder liabilities and unallocated surplus of with-profits funds held by the UK and Europe operations at 30 June 2019 is provided in note D2.2. (b) Other movements include premiums received and claims paid on investment contracts without discretionary participating features, which are taken directly to the statement of financial position in accordance with IAS 39. |
Shareholder-backed | |
Policyholder liabilities and unallocated surplus | |
Analysis of movements in policyholder liabilities and unallocated surplus of with-profits funds | Half year 2019 £m UK and Asia US Europe Total At 1 January 2019 40,597 185,600 40,760 266,957 Reclassification of UK and Europe liabilities as held for distribution — — (40,760) (40,760) Net flows: Premiums 3,923 7,060 — 10,983 Surrenders (1,324) (6,398) — (7,722) Maturities/deaths (439) (1,348) — (1,787) Net flows note 2,160 (686) — 1,474 Investment-related items and other movements 1,623 16,838 — 18,461 Foreign exchange translation differences 340 400 — 740 At 30 June 2019 44,720 202,152 — 246,872 Comprising: - Policyholder liabilities on the consolidated statement of financial position 36,036 202,152 — 238,188 (excludes £47 million classified as unallocated to a segment) - Group's share of policyholder liabilities relating to joint ventures and associate 8,684 — — 8,684 Half year 2018 £m UK and Asia US Europe Total At 1 January 2018 37,402 180,724 56,367 274,493 Reclassification of reinsured UK annuity contracts as held for sale — — (12,002) (12,002) Net flows: Premiums 3,266 7,111 681 11,058 Surrenders (1,383) (5,953) (1,200) (8,536) Maturities/deaths (420) (1,076) (1,294) (2,790) Net flows note 1,463 82 (1,813) (268) Investment-related items and other movements (718) (103) (236) (1,057) Foreign exchange translation differences 1 4,447 — 4,448 At 30 June 2018 38,148 185,150 42,316 265,614 Comprising: - Policyholder liabilities on the consolidated statement of financial position 30,539 185,150 42,316 258,005 (excludes £37 million classified as unallocated to a segment) - Group's share of policyholder liabilities relating to joint ventures and associate 7,609 — — 7,609 Note Including net flows of the Group’s insurance joint ventures and associate. |
Asia insurance operations | |
Policyholder liabilities and unallocated surplus | |
Analysis of movements in policyholder liabilities and unallocated surplus of with-profits funds | Half year 2019 £m With-profits Unit-linked Other business liabilities business Total At 1 January 2019 42,166 20,182 20,415 82,763 Comprising: - Policyholder liabilities on the consolidated statement of financial position note (v) 39,655 16,368 16,084 72,107 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 2,511 — — 2,511 - Group's share of policyholder liabilities relating to joint ventures and associate note (i) — 3,814 4,331 8,145 Premiums: New business 594 775 912 2,281 In-force 3,057 932 1,304 5,293 3,651 1,707 2,216 7,574 Surrenders note (ii) (207) (1,070) (254) (1,531) Maturities/deaths (550) (69) (370) (989) Net flows 2,894 568 1,592 5,054 Shareholders' transfers post tax (38) — — (38) Investment-related items and other movements note (iii) 4,519 582 1,041 6,142 Foreign exchange translation differences note (iv) 336 172 168 676 At 30 June 2019 49,877 21,504 23,216 94,597 Comprising: - Policyholder liabilities on the consolidated statement of financial position note (v) 46,933 17,594 18,442 82,969 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 2,944 — — 2,944 - Group's share of policyholder liabilities relating to joint ventures and associate note (i) — 3,910 4,774 8,684 Half year 2018 £m With-profits Unit-linked Other business liabilities business Total At 1 January 2018 36,437 20,027 17,375 73,839 Comprising: - Policyholder liabilities on the consolidated statement of financial position 32,963 16,263 13,672 62,898 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 3,474 — — 3,474 - Group's share of policyholder liabilities relating to joint ventures and associate note (i) — 3,764 3,703 7,467 Premiums: New business 432 870 435 1,737 In-force 2,549 841 1,120 4,510 2,981 1,711 1,555 6,247 Surrenders note (ii) (164) (1,071) (312) (1,547) Maturities/deaths (418) (93) (327) (838) Net flows 2,399 547 916 3,862 Shareholders' transfers post tax (27) — — (27) Investment-related items and other movements note (iii) (631) (652) (66) (1,349) Foreign exchange translation differences note (iv) 689 (142) 143 690 At 30 June 2018 38,867 19,780 18,368 77,015 Comprising: - Policyholder liabilities on the consolidated statement of financial position note (v) 35,101 16,094 14,445 65,640 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 3,766 — — 3,766 - Group's share of policyholder liabilities relating to joint ventures and associate note (i) — 3,686 3,923 7,609 Average policyholder liability balances note (vi) Half year 2019 43,294 20,843 21,816 85,953 Half year 2018 34,032 19,903 17,872 71,807 Notes (i) The Group’s investment in joint ventures and associate are accounted for on an equity method and the Group’s share of the policyholder liabilities as shown above relate to the life business in China, India and of the Takaful business in Malaysia. (ii) The rate of surrenders for shareholder-backed business (expressed as a percentage of opening liabilities) was 3.3 per cent in the first half of 2019 (half year 2018: 3.7 per cent). (iii) Investment-related items and other movements in the first half of 2019 primarily represent equity market gains from the with-profits business and falls in bond yields during the period in a number of business units. (iv) Movements in the period have been translated at the average exchange rates for the period ended 30 June 2019. The closing balance has been translated at the closing spot rates as at 30 June 2019. Differences upon retranslation are included in foreign exchange translation differences. (v) The policyholder liabilities at 30 June 2019 is after deducting the intra-group reinsurance liabilities ceded by the UK and Europe insurance operations of £1,108 million (30 June 2018: £1,181 million) for the with-profits business.Including this amount the Asia total policyholder liabilities are £84,077 million (30 June 2018: £66,821 million). (vi) Averages have been based on opening and closing balances, adjusted for any acquisitions, disposals and corporate transactions arising in the period, and exclude unallocated surplus of with-profits funds. |
Jackson (US insurance operations) | |
Policyholder liabilities and unallocated surplus | |
Analysis of movements in policyholder liabilities and unallocated surplus of with-profits funds | Half year 2019 £m Variable annuity Fixed annuity, separate account GICs and other liabilities business Total At 1 January 2019 128,220 57,380 185,600 Premiums 4,661 2,399 7,060 Surrenders (4,643) (1,755) (6,398) Maturities/deaths (604) (744) (1,348) Net flows note (ii) (586) (100) (686) Transfers from general to separate account 492 (492) — Investment-related items and other movements note (iii) 16,800 38 16,838 Foreign exchange translation differences note (i) 369 31 400 At 30 June 2019 145,295 56,857 202,152 Half year 2018 £m Variable annuity Fixed annuity, separate account GICs and other liabilities business Total At 1 January 2018 130,528 50,196 180,724 Premiums 5,528 1,583 7,111 Surrenders (4,225) (1,728) (5,953) Maturities/deaths (540) (536) (1,076) Net flows note (ii) 763 (681) 82 Transfers from general to separate account 387 (387) — Investment-related items and other movements 582 (685) (103) Foreign exchange translation differences note (i) 3,286 1,161 4,447 At 30 June 2018 135,546 49,604 185,150 Average policyholder liability balances note (iv) Half year 2019 136,757 57,119 193,876 Half year 2018 133,037 49,900 182,937 Notes (i) Movements in the period have been translated at an average rate of US$1.29: £1.00 (30 June 2018: US$1.38: £1.00). The closing balances have been translated at closing rate of US$1.27: £1.00 (31 December 2018: US$1.27: £1.00). Differences upon retranslation are included in foreign exchange translation differences. (ii) Net outflows in the first half of 2019 were £686 million (first half of 2018 inflows: £82 million) with net outflows from the variable annuity business following lower sales in the period offset by higher sales of other business in line with the intention to diversify the US product mix. The net outflow for other business in half year 2019 included annuity payments relating to the John Hancock business which was acquired in the fourth quarter of 2018. (iii) Positive investment-related items and other movements in variable annuity separate account liabilities of £16,800 million for the first half of 2019 represent positive separate account return mainly following the increase in the US equity market in the period. (iv) Averages have been based on opening and closing balances |
Intangible assets (Tables)
Intangible assets (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Intangible assets | |
Reconciliation of goodwill | 2019 £m 2018 £m 30 Jun 31 Dec Carrying value at beginning of period 1,857 1,482 Reclassification to held for distribution note D2.2 (1,359) — Additions in the period — 376 Disposals/reclassifications to held for sale — (10) Exchange differences 12 9 Carrying value at end of period 510 1,857 |
Schedule of deferred acquisition costs and other intangible assets | 2019 £m 2018 £m 30 Jun 31 Dec Deferred acquisition costs and other intangible assets attributable to shareholders: From continuing operations 12,601 11,672 From discontinued operations* — 112 Total 12,601 11,784 Other intangible assets, including computer software, attributable to with-profits funds: From continuing operations 58 56 From discontinued operations* — 83 Total 58 139 Total of deferred acquisition costs and other intangible assets 12,659 11,923 * Classified as discontinued operations at 30 June 2019 (as described in note A2). |
Shareholder-backed | |
Intangible assets | |
Schedule of deferred acquisition costs and other intangible assets | 2019 £m 2018 £m 30 Jun 31 Dec Deferred acquisition costs related to insurance contracts as classified under IFRS 4 10,326 10,017 Deferred acquisition costs related to investment management contracts, including life assurance contracts classified as financial instruments and investment management contracts under IFRS 4 27 78 Deferred acquisition costs related to insurance and investment contracts 10,353 10,095 Present value of acquired in-force policies for insurance contracts as classified under IFRS 4 (PVIF) 31 34 Distribution rights and other intangibles 2,217 1,655 Present value of acquired in-force (PVIF) and other intangibles attributable to shareholders 2,248 1,689 Total of deferred acquisition costs and other intangible assets note (a) 12,601 11,784 Notes (a) Total deferred acquisition costs and other intangible assets can be further analysed by business operations as follows: 2019 £m 2018 £m Deferred acquisition costs UK and Asia US Europe All asset PVIF and other 30 Jun 31 Dec insurance insurance* insurance management intangibles† Total Total Balance at 1 January: 1,264 8,727 86 18 1,689 11,784 10,866 Reclassification to held for distribution — — (86) (18) (8) (112) — Additions‡ 198 285 — — 652 1,135 1,248 Amortisation to the income statement: note (c) Adjusted IFRS operating profit based on longer-term investment returns (91) (94) — — (102) (287) (1,024) Non-operating profit — 476 — — — 476 (118) (91) 382 — — (102) 189 (1,142) Disposals and transfers — — — — (5) (5) (14) Exchange differences and other movements 12 8 — — 22 42 580 Amortisation of DAC related to net unrealised valuation movements on the US insurance operation's available-for-sale securities recognised within other comprehensive income — (432) — — — (432) 246 Balance at 30 June 1,383 8,970 — — 2,248 12,601 11,784 * Under the Group’s application of IFRS 4, US GAAP is used for measuring the insurance assets and liabilities of its US and certain Asia operations. Under US GAAP, most of the US insurance operation’s products are accounted for under Accounting Standard no. 97 of the Financial Accounting Standards Board (FAS 97) whereby deferred acquisition costs are amortised in line with the emergence of actual and expected gross profits which are determined using an assumption for long-term investment returns for the separate account of 7.4 per cent (full year 2018: 7.4 per cent) (gross of asset management fees and other charges to policyholders, but net of external fund management fees). The amounts included in the income statement and other comprehensive income affect the pattern of profit emergence and thus the DAC amortisation attaching. DAC amortisation is allocated to the operating and non-operating components of the Group’s supplementary analysis of profit and other comprehensive income by reference to the underlying items. † PVIF and other intangibles comprise PVIF, distribution rights and other intangibles such as software rights. Distribution rights relate to amounts that have been paid or have become unconditionally due for payment as a result of past events in respect of bancassurance partnership arrangements in Asia. These agreements allow for bank distribution of Prudential’s insurance products for a fixed period of time. Software rights include amounts reclassified as held for distribution of negative £6 million, additions of £16 million, amortisation of £15 million, disposals of £2 million and a balance at 30 June 2019 of £55 million. ‡ In January 2019, the Group renewed its regional strategic bancassurance alliance with United Overseas Bank Limited (UOB). The new agreement extends the original alliance, which commenced in 2010, to 2034 and increases the geographical scope to include a fifth market, Vietnam, alongside the existing markets of Singapore, Malaysia, Thailand and Indonesia. As part of this transaction, Prudential has agreed to pay UOB an initial fee of £662 million (translated using a Singapore dollar: £ foreign exchange rate of 1.7360) for distribution rights which are not dependent on future sales volumes. This amount is paid in three instalments of £230 million in February 2019, £331 million in January 2020 and £101 million in January 2021. After allowing for discounting, the amount included in additions in the table above is £630 million. |
Jackson (US insurance operations) | Shareholder-backed | |
Intangible assets | |
Schedule of DAC components | 2019 £m 2018 £m 30 Jun 31 Dec Variable annuity business 9,118 8,477 Other business 341 299 Cumulative shadow DAC (for unrealised gains/losses booked in other comprehensive income)* (489) (49) Total DAC for US operations 8,970 8,727 * A loss of £(432) million (31 December 2018: a gain of £246 million) for shadow DAC amortisation is booked within other comprehensive income to reflect the impact from the positive unrealised valuation movement for half year 2019 of £2,617 million (31 December 2018: negative unrealised valuation movement of £(1,617) million). These adjustments reflect the movement from period to period, in the changes to the pattern of reported gross profits that would have happened if the assets reflected in the statement of financial position had been sold, crystallising the unrealised gains and losses, and the proceeds reinvested at the yields currently available in the market. At 30 June 2019, the cumulative shadow DAC balance as shown in the table above was negative £(489) million (31 December 2018: negative £(49) million). |
Borrowings (Tables)
Borrowings (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Core structural borrowings of shareholder-financed businesses | |
Borrowings | |
Schedule of borrowings | 2019 £m 2018 £m 30 Jun 31 Dec Holding company operations: note (i) Subordinated debt with no option to substitute to M&GPrudential: US$250m 6.75% Notes (Tier 1) note (ii) 196 196 US$300m 6.5% Notes (Tier 1) note (ii) 236 235 US$550m 7.75% Notes (Tier 1) — — Perpetual Subordinated Capital Securities (Tier 1) 432 431 US$700m 5.25% Notes (Tier 2) 550 550 US$1,000m 5.25% Notes (Tier 2) 781 780 US$725m 4.375% Notes (Tier 2) 566 565 US$750m 4.875% Notes (Tier 2) 584 583 Perpetual Subordinated Capital Securities (Tier 2) 2,481 2,478 €20m Medium Term Notes 2023 (Tier 2) 18 18 £435m 6.125% Notes 2031 (Tier 2) 431 431 £400m 11.375% Notes 2039 (Tier 2) note (iii) — 399 Subordinated notes (Tier 2) 449 848 Subordinated debt total 3,362 3,757 Senior debt: note (iv) £300m 6.875% Bonds 2023 295 294 £250m 5.875% Bonds 2029 224 223 Bank loan note (v) 275 275 Total debt before amounts capable of being substituted to M&GPrudential note (vii) 4,156 4,549 Subordinated debt capable of being substituted to M&GPrudential as at 30 Jun 2019: £600m 5.56% (30 Jun and 31 Dec 2018: 5.0%) Notes 2055 (Tier 2) note (vi) 642 591 £700m 6.34% (30 Jun and 31 Dec 2018: 5.7%) Notes 2063 (Tier 2) note (vi) 814 696 £750m 5.625% Notes 2051 (Tier 2) 744 743 £500m 6.25% Notes 2068 (Tier 2) 498 498 US$500m 6.5% Notes 2048 (Tier 2) 391 391 Total subordinated debt capable of being substituted to M&GPrudential as at 30 Jun 2019 note (vii) 3,089 2,919 Holding company total 7,245 7,468 Prudential Capital bank loan note (v) — — Jackson US$250m 8.15% Surplus Notes 2027 note(viii) 196 196 Total (per condensed consolidated statement of financial position) 7,441 7,664 Notes (i) The debt tier classifications used are consistent with the treatment of capital for regulatory purposes under the Solvency II regime.The Group has designated US$3,725 million (31 December 2018: US$3,725 million) of its US dollar denominated subordinated debt as a net investment hedge under IAS 39 to hedge the currency risks related to the net investment in Jackson. (ii) These borrowings can be converted, in whole or in part, at the Company’s option and subject to certain conditions, on any interest payment date, into one or more series of Prudential preference shares. (iii) In May 2019, the Company redeemed its £400 million 11.375 per cent Tier 2 subordinated notes. (iv) The senior debt ranks above subordinated debt in the event of liquidation.In 2018, as part of its preparation to demerge M&GPrudential, the Group made certain modifications to the terms and conditions of the senior bonds with bondholders’ consent. The amendment to the terms and conditions will avoid an event of a technical default on the bonds, should the proposed demerger proceed. The fees paid to bondholders have been adjusted to the carrying value of the bonds and will be amortised in subsequent periods. No other adjustments were made to the carrying value of the debt as a result of the modification. (v) The bank loan of £275 million is drawn at a cost of 12-month GBP LIBOR plus 0.33 per cent. The loan, held by Prudential Capital at 30 June 2018, was renewed in December 2018 with Prudential plc being the new holder. The loan matures on 20 December 2022 with an option to repay annually. (vi) In the first half of 2019, the Group agreed with the holders of these two subordinated debt instruments that, in return for an increase in the coupon of the two instruments and upfront fees totalling £141 million for both instruments, they would permit the substitution of M&GPrudential as the issuer of the instruments, together with other modifications of terms to ensure the debt meet the requirements of Solvency II. In accordance with IAS 39, this has been accounted for as an extinguishment of the old debt and the issuance of new debt, recognised at fair value. The loss arising from this revaluation has been treated as an expense attributable to the M&GPrudential segment (see note D2.1). The £141 million of upfront fees have been paid by Prudential plc and have been treated as a non-operating expense. (vii) The annualised interest of debt that is not capable of being substituted to M&GPrudential, using coupon rates and exchange rates at 30 June 2019, is £(234) million. The interest charge to the income statement for the six months ended 30 June 2019 for debt that is capable of being substituted to M&GPrudential was £(85) million (half year 2018: £(35) million). (viii) Jackson’s borrowings are unsecured and subordinated to all present and future indebtedness, policy claims and other creditor claims of Jackson. |
Operational borrowings attributable to shareholder-financed businesses | |
Borrowings | |
Schedule of borrowings | 2019 £m 2018 £m 30 Jun 31 Dec Borrowings in respect of short-term fixed income securities programmes 661 472 Lease liability for operating leases note (a) 229 — Non-recourse borrowings of consolidated investment funds note (b) 545 263 Other borrowings note (c) 229 263 Total 1,664 998 Analysed as: Total from continuing operations 892 Total from discontinued UK and Europe operations* 106 998 * Classified as discontinued operations at 30 June 2019 (as described in note A2). Notes (a) The Group adopted IFRS 16 as at 1 January 2019, using the modified retrospective approach. Under this approach, comparative information is not restated (as described in note A3). (b) In all instances, the holders of the debt instruments issued by these subsidiaries and funds do not have recourse beyond the assets of those subsidiaries and funds. (c) Other borrowings mainly include senior debt issued through the Federal Home Loan Bank of Indianapolis (FHLB), secured by collateral posted with the FHLB by Jackson. |
Borrowings attributable to with-profits businesses | |
Borrowings | |
Schedule of borrowings | 2019 £m 2018 £m 30 Jun 31 Dec Non-recourse borrowings of consolidated investment funds note (a) — 3,845 Other borrowings (predominantly obligations under leases) note (b) 238 95 Total 238 3,940 Analysed as: Total from continuing operations 19 Total from discontinued UK and Europe operations* 3,921 3,940 * Notes (a) In all instances the holders of the debt instruments issued by these subsidiaries and funds do not have recourse beyond the assets of those subsidiaries and funds. (b) The Group adopted IFRS 16 as at 1 January 2019, using the modified retrospective approach. Under this approach, comparative information is not restated. Other borrowings at 30 June 2019 included £213 million relating to lease liabilities (as described in note A3). |
Deferred tax (Tables)
Deferred tax (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Deferred tax | |
Schedule of deferred tax assets and liabilities | Half year 2019 £m Movement Other through movements other including Reclassification Movement in comprehensive foreign as held for income income and currency At 1 Jan distribution* statement equity movements At 30 Jun Deferred tax assets Unrealised losses or gains on investments 113 — (13) — (97) 3 Balances relating to investment and insurance contracts 1 — — — — 1 Short-term temporary differences 2,339 (115) 392 (1) 5 2,620 Capital allowances 15 (11) (1) — — 3 Unused tax losses 127 — 8 — — 135 Total 2,595 (126) 386 (1) (92) 2,762 Deferred tax liabilities Unrealised losses or gains on investments (867) 827 (40) (459) 74 (465) Balances relating to investment and insurance contracts (1,002) — (189) — 2 (1,189) Short-term temporary differences (2,097) 183 (139) 16 (5) (2,042) Capital allowances (56) 51 — — — (5) Total (4,022) 1,061 (368) (443) 71 (3,701) * |
Share capital, share premium _2
Share capital, share premium and own shares (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Share capital, share premium and own shares | |
Schedule of reconciliation of issued shares | 30 Jun 2019 31 Dec 2018 Share Share Share Share Number of capital premium Number of ordinary capital premium Issued shares of 5p each fully paid: ordinary shares £m £m shares £m £m At 1 January 2,593,044,409 130 1,964 2,587,175,445 129 1,948 Shares issued under share-based schemes 6,751,790 — 10 5,868,964 1 16 At end of period 2,599,796,199 130 1,974 2,593,044,409 130 1,964 |
Summary of options outstanding under save as you earn schemes to subscribe for shares | Number of shares Share price range Exercisable to subscribe for from to by year 30 Jun 2019 3,808,687 901 p 1,455 p 31 Dec 2018 4,885,804 901 p 1,455 p |
Summary of purchases of own shares in respect of employee incentive plans | Number of shares purchased Cost (in millions) £m Half year 2019 3.1 49.4 Full year 2018 2.6 44.8 |
Gain (loss) on disposal of bu_2
Gain (loss) on disposal of business and corporate transactions undertaken by continuing operations (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Gain (loss) on disposal of business and corporate transactions undertaken by continuing operations | |
Schedule of gain (loss) on disposal of businesses and corporate transactions | 2019 £m 2018 £m Half year Half year Gain on disposals note (i) 209 — Other transactions note (ii) (196) (57) 13 (57) Notes (i) In half year 2019, the £209 million gain on disposals principally relates to profits arising from a reduction in the Group’s stake (from 26 per cent to 22 per cent) in its associate in India, ICICI Prudential Life Insurance Company, and the disposal of Prudential Vietnam Finance Company Limited, a wholly owned subsidiary that provides consumer finance. (ii) Other transaction costs of £(196) million incurred by the continuing operations of the Group in half year 2019 reflect costs related to the preparation for the proposed demerger of M&GPrudential from Prudential plc. These include the following amounts: - £(18) million transaction related costs, principally fees to advisors; - £(141) million being the fee paid to the holders of two subordinated debt instruments as discussed in note C6.1(vi); and - £(37) million for one-off costs arising from the separation of the M&GPrudential business from Prudential plc. In 2018, other transaction costs additionally included amounts from exiting the NPH broker-dealer business in the US. |
Discontinued UK and Europe op_2
Discontinued UK and Europe operations held for distribution (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Discontinued UK and Europe operations held for distribution | |
Analysis of movements in policyholder liabilities and unallocated surplus of with-profits funds | Half year 2019 £m UK and Asia US Europe Total note C4.2 note C4.3 note D2.2 At 1 January 2019 82,763 185,600 164,889 433,252 Comprising: - Policyholder liabilities on the consolidated statement of financial position (excludes £39 million classified as unallocated to a segment) note (a) 72,107 185,600 151,555 409,262 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 2,511 — 13,334 15,845 - Group's share of policyholder liabilities of joint ventures and associate note(b) 8,145 — — 8,145 Reclassification of UK and Europe liabilities as held for distribution — — (164,889) (164,889) Net flows: Premiums 7,574 7,060 — 14,634 Surrenders (1,531) (6,398) — (7,929) Maturities/deaths (989) (1,348) — (2,337) Net flows 5,054 (686) — 4,368 Shareholders' transfers post tax (38) — — (38) Investment-related items and other movements 6,142 16,838 — 22,980 Foreign exchange translation differences 676 400 — 1,076 At 30 June 2019 94,597 202,152 — 296,749 Comprising: - Policyholder liabilities on the consolidated statement of financial position 82,969 202,152 — 285,121 (excludes £47 million classified as unallocated to a segment) note (a) - Unallocated surplus of with-profits funds on the consolidated statement of financial position 2,944 — — 2,944 - Group's share of policyholder liabilities of joint ventures and associate note (b) 8,684 — — 8,684 Half year 2018 £m UK and Asia US Europe Total note C4.2 note C4.3 note D2.2 At 1 January 2018 73,839 180,724 181,066 435,629 Comprising: - Policyholder liabilities on the consolidated statement of financial position (excludes £32 million classified as unallocated to a segment) 62,898 180,724 167,589 411,211 - Unallocated surplus of with-profits funds on the consolidated statement of financial position 3,474 — 13,477 16,951 - Group's share of policyholder liabilities of joint ventures and associate note (b) 7,467 — — 7,467 Reclassification of reinsured UK annuity contracts as held for sale — — (12,002) (12,002) Net flows: Premiums 6,247 7,111 6,964 20,322 Surrenders (1,547) (5,953) (3,446) (10,946) Maturities/deaths (838) (1,076) (3,499) (5,413) Net flows 3,862 82 19 3,963 Shareholders' transfers post tax (27) — (127) (154) Investment-related items and other movements (1,349) (103) (801) (2,253) Foreign exchange translation differences 690 4,447 17 5,154 At 30 June 2018 77,015 185,150 168,172 430,337 Comprising: - Policyholder liabilities on the consolidated statement of financial position 65,640 185,150 154,655 405,445 (excludes £37 million classified as unallocated to a segment) note (a) - Unallocated surplus of with-profits funds on the consolidated statement of financial position 3,766 — 13,517 17,283 - Group's share of policyholder liabilities of joint ventures and associate note (b) 7,609 — — 7,609 Average policyholder liability balances note (c) Half year 2019 85,953 193,876 — 279,829 Half year 2018 71,807 182,937 161,122 415,866 Notes (a) The policyholder liabilities of the Asia insurance operations at 30 June 2019 of £82,969 million (30 June 2018: £65,640 million) are after deducting the intra-group reinsurance liabilities ceded by the UK and Europe insurance operations of £1,108 million (30 June 2018: £1,181 million) to the Hong Kong with-profits business. Including this amount, total Asia policyholder liabilities are £84,077 million (30 June 2018: £66,821 million). (b) The Group’s investment in joint ventures and associate are accounted for on an equity method basis in the Group’s statement of financial position. The Group’s share of the policyholder liabilities as shown above relates to life businesses in China, India and of the Takaful business in Malaysia. (c) Averages have been based on opening and closing balances, adjusted for acquisitions, disposals and corporate transactions arising in the period, and exclude unallocated surplus of with-profits funds. |
At fair value | |
Discontinued UK and Europe operations held for distribution | |
Schedule of fair value of assets and liabilities | 30 Jun 2019 £m Level 1 Level 2 Level 3 Valuation Valuation Quoted prices based on based on (unadjusted) significant significant Analysis of financial investments, net of derivative liabilities in active observable unobservable by business type from continuing operations markets market inputs market inputs Total With-profits Loans — — — — Equity securities and portfolio holdings in unit trusts 19,318 1,906 153 21,377 Debt securities 28,964 3,093 6 32,063 Other investments (including derivative assets) 107 81 — 188 Derivative liabilities (34) (11) — (45) Total financial investments, net of derivative liabilities 48,355 5,069 159 53,583 Percentage of total (%) 90 % 10 % 0 % 100 % Unit-linked and variable annuity separate account Equity securities and portfolio holdings in unit trusts 159,462 230 — 159,692 Debt securities 2,840 763 — 3,603 Other investments (including derivative assets) — — — — Derivative liabilities (11) (6) — (17) Total financial investments, net of derivative liabilities 162,291 987 — 163,278 Percentage of total (%) 99 % 1 % 0 % 100 % Non-linked shareholder-backed Loans — — 2,799 2,799 Equity securities and portfolio holdings in unit trusts 2,580 4 17 2,601 Debt securities 16,726 47,283 — 64,009 Other investments (including derivative assets) 42 988 962 1,992 Derivative liabilities (7) (513) (455) (975) Total financial investments, net of derivative liabilities 19,341 47,762 3,323 70,426 Percentage of total (%) 27 % 68 % 5 % 100 % Group total analysis, including other financial liabilities held at fair value from continuing operations Loans — — 2,799 2,799 Equity securities and portfolio holdings in unit trusts 181,360 2,140 170 183,670 Debt securities 48,530 51,139 6 99,675 Other investments (including derivative assets) 149 1,069 962 2,180 Derivative liabilities (52) (530) (455) (1,037) Total financial investments, net of derivative liabilities 229,987 53,818 3,482 287,287 Investment contract liabilities without discretionary participation features held at fair value — (666) — (666) Net asset value attributable to unit holders of consolidated unit trusts and similar funds (3,482) — — (3,482) Other financial liabilities held at fair value — (5) (3,081) (3,086) Total financial instruments at fair value 226,505 53,147 401 280,053 Percentage of total (%) 81 % 19 % 0 % 100 % 31 Dec 2018 £m Level 1 Level 2 Level 3 Valuation Valuation Quoted prices based on based on (unadjusted) significant significant Analysis of financial investments, net of derivative in active observable unobservable liabilities by business type markets market inputs market inputs Total With-profits Loans — — 1,703 1,703 Equity securities and portfolio holdings in unit trusts 52,320 5,447 488 58,255 Debt securities 31,210 48,981 811 81,002 Other investments (including derivative assets) 143 3,263 4,325 7,731 Derivative liabilities (85) (1,231) — (1,316) Total financial investments, net of derivative liabilities 83,588 56,460 7,327 147,375 Percentage of total (%) 57 % 38 % 5 % 100 % Unit-linked and variable annuity separate account Equity securities and portfolio holdings in unit trusts 152,987 505 9 153,501 Debt securities 4,766 9,727 — 14,493 Other investments (including derivative assets) 6 3 6 15 Derivative liabilities (2) (3) — (5) Total financial investments, net of derivative liabilities 157,757 10,232 15 168,004 Percentage of total (%) 94 % 6 % 0 % 100 % Non-linked shareholder-backed Loans — — 3,050 3,050 Equity securities and portfolio holdings in unit trusts 2,957 2 18 2,977 Debt securities 17,687 61,803 371 79,861 Other investments (including derivative assets) 61 1,258 941 2,260 Derivative liabilities (2) (1,760) (423) (2,185) Total financial investments, net of derivative liabilities 20,703 61,303 3,957 85,963 Percentage of total (%) 24 % 71 % 5 % 100 % Group total analysis, including other financial liabilities held at fair value Loans — — 4,753 4,753 Equity securities and portfolio holdings in unit trusts 208,264 5,954 515 214,733 Debt securities 53,663 120,511 1,182 175,356 Other investments (including derivative assets) 210 4,524 5,272 10,006 Derivative liabilities (89) (2,994) (423) (3,506) Total financial investments, net of derivative liabilities 262,048 127,995 11,299 401,342 Investment contract liabilities without discretionary participation features held at fair value — (16,054) — (16,054) Borrowings attributable to with-profits businesses — — (1,606) (1,606) Net asset value attributable to unit holders of consolidated unit trusts and similar funds (6,852) (3,811) (988) (11,651) Other financial liabilities held at fair value — (2) (3,404) (3,406) Total financial instruments at fair value 255,196 108,128 5,301 368,625 Percentage of total (%) 70 % 29 % 1 % 100 % Analysed as: Total from continuing operations With-profits 39,191 3,928 159 43,278 Unit-linked and variable annuity separate account 143,556 (64) — 143,492 Non-linked shareholder-backed 16,549 43,948 266 60,763 199,296 47,812 425 247,533 Percentage of total continuing operations (%) 81 % 19 % 0 % 100 % Total from discontinued UK and Europe operations* 55,900 60,316 4,876 121,092 Percentage of total discontinued operations (%) 46 % 50 % 4 % 100 % * Classified as discontinued operations at 30 June 2019 (as described in note A2). |
Fair value of instruments not measured at fair value | |
Discontinued UK and Europe operations held for distribution | |
Schedule of fair value of assets and liabilities | The table below shows the financial assets and liabilities carried at amortised cost on the statement of financial position and their fair value, excluding those held for distribution. Cash deposits, accrued income, other debtors, accruals, deferred income and other liabilities are excluded from the analysis below, as these are carried at amortised cost, which approximates fair value. 2019 £m 2018 £m 30 Jun 31 Dec Carrying Fair Carrying Fair value value value value Assets Loans 9,714 10,010 13,257 13,666 Liabilities Investment contract liabilities without discretionary participation features (3,132) (3,140) (3,168) (3,157) Core structural borrowings of shareholder-financed businesses (7,441) (8,052) (7,664) (7,847) Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses (1,435) (1,435) (998) (998) Borrowings (excluding lease liabilities) attributable to the with-profits funds (25) (24) (2,334) (2,103) Obligations under funding, securities lending and sale and repurchase agreements (6,756) (6,890) (6,989) (7,008) Total financial instruments carried at amortised cost (9,075) (9,531) (7,896) (7,447) Analysed as: Total from continuing operations (7,848) (8,040) Total from discontinued UK and Europe operations* (48) 593 (7,896) (7,447) * Classified as discontinued operations at 30 June 2019 (as described in note A2). |
Loans | |
Discontinued UK and Europe operations held for distribution | |
Schedule of amounts included in the statement of financial position | 30 Jun 2019 £m 31 Dec 2018 £m Mortgage loans Policy loans Other loans Total Mortgage loans Policy loans Other loans Total note (i) note (ii) note (i) note (ii) Asia With-profits — 783 63 846 — 727 65 792 Non-linked shareholder-backed 140 233 15 388 156 226 203 585 US Non-linked shareholder-backed 7,587 3,686 — 11,273 7,385 3,681 — 11,066 Other operations — — 6 6 — — — — Total continuing operations 7,727 4,702 84 12,513 7,541 4,634 268 12,443 Total discontinued UK and Europe operations note (iii) 4,116 3 1,448 5,567 Total loans securities 11,657 4,637 1,716 18,010 Notes (i) All mortgage loans are secured by properties. (ii) In the US, £2,799 million of policy loans held at 30 June 2019 (31 December 2018: £2,783 million) are backing liabilities for funds withheld under reinsurance arrangements and are accounted for at fair value through profit or loss. All other policy loans are accounted for at amortised cost, less any impairment. (iii) The amounts held by the UK and Europe operations were transferred to assets held for distribution at 30 June 2019 (see note D2.2). |
Debt securities | |
Discontinued UK and Europe operations held for distribution | |
Schedule of securities analysed according to external credit ratings | 30 Jun 2019 £m Other BBB+ (including AAA AA+ to AA- A+ to A- to BBB- Below BBB- NAIC rated) Total Asia With-profits 3,131 14,977 4,688 4,621 2,016 2,630 32,063 Unit-linked 405 196 458 1,502 378 664 3,603 Non-linked shareholder-backed 1,072 4,155 4,458 3,287 2,493 1,371 16,836 Asset management 12 — 37 — — — 49 US Non-linked shareholder-backed 1,189 7,984 11,527 15,068 1,579 7,917 45,264 Other operations 510 1,144 129 20 50 7 1,860 Total debt securities 6,319 28,456 21,297 24,498 6,516 12,589 99,675 31 Dec 2018 £m Other BBB+ (including AAA AA+ to AA- A+ to A- to BBB- Below BBB- NAIC rated) Total Asia With-profits 2,873 12,379 4,142 3,760 1,747 2,303 27,204 Unit-linked 817 100 492 1,431 426 715 3,981 Non-linked shareholder-backed 1,034 3,552 3,717 2,934 2,202 1,144 14,583 Asset management 11 — 60 — — — 71 US Non-linked shareholder-backed 678 7,383 10,286 14,657 1,429 7,161 41,594 Other operations 619 1,089 151 41 49 18 1,967 Total continuing operations 6,032 24,503 18,848 22,823 5,853 11,341 89,400 Total discontinued UK and Europe operations* 10,938 18,204 18,645 19,728 3,444 14,997 85,956 Total debt securities 16,970 42,707 37,493 42,551 9,297 26,338 175,356 * Classified as discontinued operations at 30 June 2019 (as described in note A2). |
Schedule of securities with credit ratings classified as "Other" | 2019 £m 2018 £m Asia 30 Jun 31 Dec Government bonds 37 36 Corporate bonds - rated as investment grade by local external ratings agencies 1,215 978 Other 119 130 Total Asia non-linked shareholder-backed other debt securities 1,371 1,144 2019 £m 2018 £m Mortgage -backed Other US securities securities 30 Jun 31 Dec Implicit ratings of other US debt securities based on NAIC* valuations (see below) NAIC 1 2,184 3,337 5,521 5,006 NAIC 2 — 2,357 2,357 2,118 NAIC 3-6 3 36 39 37 Total US other debt securities † 2,187 5,730 7,917 7,161 * The Securities Valuation Office of the NAIC classifies debt securities into six quality categories ranging from Class 1 (the highest) to Class 6 (the lowest). Performing securities are designated as Classes 1 to 5 and securities in or near default are designated Class 6. † Mortgage-backed securities totalling £2,003 million at 30 June 2019 have credit ratings issued by Standard & Poor’s of BBB- or above and hence are designated as investment grade. Other securities totalling £5,694 million at 30 June 2019 with NAIC ratings 1 or 2 are also designated as investment grade. |
Sovereign debt | |
Discontinued UK and Europe operations held for distribution | |
Schedule of amounts included in the statement of financial position | 30 Jun 2019 £m 31 Dec 2018 £m Shareholder- With- Shareholder- With- backed profits backed profits business funds business funds Total Eurozone — — 378 440 United Kingdom 988 — 3,226 3,013 United States* 6,410 12,925 5,647 11,858 Indonesia 295 — 282 — Singapore 132 1,719 164 1,658 Thailand 1,106 — 921 — Vietnam 1,186 — 1,871 — Other Asia 1,925 944 1,779 866 Other 98 25 125 221 Total 12,140 15,613 14,393 18,056 Analysed as: Total from continuing operations 11,658 13,144 Total from discontinued UK and Europe operations † 2,735 4,912 14,393 18,056 * The exposure to the United States sovereign debt comprises holdings of the US and Asia insurance operations. † Classified as discontinued operations at 30 June 2019 (as described in note A2). |
Bank debt securities | |
Discontinued UK and Europe operations held for distribution | |
Schedule of amounts included in the statement of financial position | 30 Jun 2019 £m 2018 £m Senior debt Subordinated debt 31 Dec Shareholder-backed business Total Tier 1 Tier 2 Total Group total Group total Spain 70 — — — 70 106 France 142 — 9 9 151 156 Germany 30 — 12 12 42 125 Netherlands 56 — 3 3 59 73 Other Eurozone — — — — — 17 Total Eurozone 298 — 24 24 322 477 United Kingdom 598 8 95 103 701 1,346 United States 2,354 1 31 32 2,386 2,667 Asia 248 114 312 426 674 592 Other 470 — 75 75 545 645 Total 3,968 123 537 660 4,628 5,727 Analysed as: Total from continuing operations 4,640 Total from discontinued UK and Europe operations* 1,087 5,727 With-profits funds Italy — — — — — 38 Spain 2 — — — 2 17 France 7 — 27 27 34 352 Germany — — 47 47 47 229 Netherlands 8 — 10 10 18 266 Other Eurozone — — — — — 74 Total Eurozone 17 — 84 84 101 976 United Kingdom 31 2 82 84 115 2,194 United States 16 1 3 4 20 2,730 Asia 279 363 299 662 941 1,015 Other 59 — 142 142 201 1,810 Total 402 366 610 976 1,378 8,725 Analysed as: Total from continuing operations 1,287 Total from discontinued UK and Europe operations* 7,438 8,725 * Classified as discontinued operations at 30 June 2019 (as described in note A2). |
UK & Europe Operations (M&G Prudential) | |
Discontinued UK and Europe operations held for distribution | |
Schedule of results for discontinued operations in consolidated financial statements | The results for the discontinued operations presented in the consolidated financial statements are analysed below: D2.1 2019 £m 2018 £m Half year Half year Gross premiums earned 5,907 6,555 Outward reinsurance premiums (487) (12,598) Earned premiums, net of reinsurance 5,420 (6,043) Investment return 13,072 53 Other income 643 890 Total revenue, net of reinsurance 19,135 (5,100) Benefits and claims and movement in unallocated surplus of with-profits funds, net of reinsurance (16,361) 6,421 Fair value loss on debt extinguishment note (a) (169) — Acquisition costs and other expenditure (1,391) (1,250) Total charges, net of reinsurance (17,921) 5,171 Share of profits from joint ventures and associates, net of related tax 33 20 Profit before tax (being tax attributable to shareholders’ and policyholders’ returns) note (b) 1,247 91 Less tax charge attributable to policyholders’ returns (430) 10 Profit before tax attributable to shareholders 817 101 Total tax charge attributable to policyholders and shareholders (602) (8) Adjustment to remove tax charge attributable to policyholders’ returns 430 (10) Tax charge attributable to shareholders’ returns (172) (18) Profit for the period 645 83 Notes (a) (b) Other comprehensive income The other comprehensive income included in the consolidated statement of comprehensive income in respect of the discontinued UK and Europe operations is as follows: 2019 £m 2018 £m Half year Half year Other comprehensive income (loss) from continuing operations: Exchange movements arising during the period 2 (3) Items that will not be reclassified to profit or loss Shareholders' share of actuarial gains and (losses) on defined benefit pension schemes: Net actuarial (losses) gains on defined benefit pension schemes (177) 104 Related tax 30 (18) (147) 86 Deduct amount attributable to UK with-profit funds transferred to unallocated surplus of with-profit funds, net of related tax 149 (21) 2 65 Other comprehensive income for the period, net of related tax 4 62 |
Schedule of segment statement of financial position by business type | 2019 £m 2018‡ £m Other funds and subsidiaries Annuity Asset With- Unit- and Total manage- Elimina- 30 Jun 31 Dec By operating segment profits † linked other insurance ment tions Total Total Assets Goodwill note (a) 202 — — 202 1,153 — 1,355 1,359 Deferred acquisition costs and other intangible assets 47 — 110 157 17 — 174 195 Property, plant and equipment note (b) 997 — 66 1,063 370 — 1,433 1,031 Reinsurers' share of insurance contract liabilities 1,136 119 1,435 2,690 — — 2,690 2,812 Deferred tax assets 58 — 43 101 17 — 118 126 Current tax recoverable 215 — 57 272 7 — 279 244 Accrued investment income 1,056 89 290 1,435 10 — 1,445 1,511 Other debtors 2,105 773 226 3,104 476 (151) 3,429 4,189 Investment properties 16,406 580 1,648 18,634 — — 18,634 17,914 Investment in joint ventures and associates accounted for using the equity method 566 — — 566 39 — 605 742 Loans note (e) 3,756 — 1,779 5,535 — — 5,535 5,567 Equity securities and portfolio holdings in unit trusts 45,743 13,678 16 59,437 216 — 59,653 53,810 Debt securities note (d) 54,796 8,727 21,614 85,137 37 — 85,174 85,956 Derivative assets 2,354 2 527 2,883 — — 2,883 2,513 Other investments 6,105 9 1 6,115 18 — 6,133 5,585 Deposits 13,422 1,235 2,135 16,792 — — 16,792 10,320 Assets held for sale 6 — 10,164 10,170 — — 10,170 10,578 Cash and cash equivalents 3,311 169 792 4,272 352 — 4,624 4,749 Total assets 152,281 25,381 40,903 218,565 2,712 (151) 221,126 209,201 Total equity — — 6,287 6,287 1,993 — 8,280 8,700 Liabilities Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) note (f) 118,148 21,172 20,284 159,604 — — 159,604 151,555 Unallocated surplus of with-profits funds note (f) 15,116 — — 15,116 — — 15,116 13,334 Operational borrowings attributable to shareholder-financed operations note (b) — 4 156 160 296 — 456 106 Borrowings attributable to with-profits businesses 3,580 — — 3,580 — — 3,580 3,921 Obligations under funding, securities lending and sale and repurchase agreements 846 — 208 1,054 — — 1,054 1,224 Net asset value attributable to unit holders of consolidated unit trusts and similar funds 4,827 3,659 7 8,493 19 — 8,512 9,013 Deferred tax liabilities 995 — 163 1,158 29 — 1,187 1,061 Current tax liabilities 293 36 32 361 34 — 395 326 Accruals, deferred income and other liabilities 6,988 498 2,031 9,517 151 (151) 9,517 6,442 Provisions note (h) 21 — 373 394 190 — 584 743 Derivative liabilities 1,467 12 1,198 2,677 — — 2,677 2,208 Liabilities held for sale — — 10,164 10,164 — — 10,164 10,568 Total liabilities 152,281 25,381 34,616 212,278 719 (151) 212,846 200,501 Total equity and liabilities 152,281 25,381 40,903 218,565 2,712 (151) 221,126 209,201 * The statement of financial position as shown above reflects the segmental position of the discontinued UK and Europe operations and is therefore presented before the elimination of intragroup balances with continuing operations. † Includes the Scottish Amicable Insurance Fund which, at 30 June 2019, has total assets and liabilities of £4,887 million (31 December 2018: £4,844 million). The PAC with-profits sub-fund (WPSF) mainly contains with-profits business but it also contains some non-profit business (unit-linked, term assurances and annuities). The PAC with-profits fund includes £9.6 billion (31 December 2018: £9.5 billion) of non-profits annuities liabilities. ‡ The 2018 comparatives assets and liabilities have not been re-presented to be classified as held for distribution on the Group’s statement of financial position (as described in note A2). |
Analysis of movements in policyholder liabilities and unallocated surplus of with-profits funds | Shareholder-backed funds and subsidiaries Annuity Total and other discontinued With-profits Unit-linked long-term UK and Europe Half year 2019 movements £m sub-fund‡ liabilities business opertions At 1 January 2019 124,129 20,717 20,043 164,889 Comprising: - Policyholder liabilities 110,795 20,717 20,043 151,555 - Unallocated surplus of with-profits funds 13,334 — — 13,334 Premiums 5,668 447 151 6,266 Surrenders (2,462) (1,548) (25) (4,035) Maturities/deaths (2,309) (224) (617) (3,150) Net flows 897 (1,325) (491) (919) Shareholders' transfers post tax (130) — — (130) Switches (57) 57 — — Investment-related items and other movements 8,431 1,669 732 10,832 Foreign exchange translation differences (6) 54 — 48 At 30 June 2019 133,264 21,172 20,284 174,720 Comprising: - Policyholder liabilities 118,148 21,172 20,284 159,604 - Unallocated surplus of with-profits funds 15,116 — — 15,116 Half year 2018 movements £m At 1 January 2018 124,699 23,145 33,222 181,066 Comprising: - Policyholder liabilities 111,222 23,145 33,222 167,589 - Unallocated surplus of with-profits funds 13,477 — — 13,477 Reclassification of reinsured UK annuity contracts as held for sale* — — (12,002) (12,002) Premiums 6,283 516 165 6,964 Surrenders (2,246) (1,163) (37) (3,446) Maturities/deaths (2,205) (313) (981) (3,499) Net flows 1,832 (960) (853) 19 Shareholders' transfers post tax (127) — — (127) Switches (89) 89 — — Investment-related items and other movements (476) (76) (249) (801) Foreign exchange translation differences 17 — — 17 At 30 June 2018 125,856 22,198 20,118 168,172 Comprising: - Policyholder liabilities 112,339 22,198 20,118 154,655 - Unallocated surplus of with-profits funds 13,517 — — 13,517 Average policyholder liability balances † Half year 2019 114,472 20,945 20,163 155,580 Half year 2018 111,781 22,671 26,670 161,122 * The reclassification of the reinsured UK annuity business as held for sale reflects the value of policyholder liabilities held at 1 January 2018. Movements in items covered by the reinsurance contract prior to the 14 March inception date are included within net flows. † ‡ |
Schedule of cash flows | 2019 £m 2018 £m Half year Half year Cash flows from operating activities 404 (1,711) Cash flows from investing activities (172) (224) Cash flows from financing activities* (356) (445) Total cash flows in the period (124) (2,380) Cash and cash equivalents at beginning of period 4,749 5,808 Effect of exchange rate changes on cash and cash equivalents (1) (8) Cash and cash equivalents at end of period 4,624 3,420 * |
UK & Europe Operations (M&G Prudential) | At fair value | |
Discontinued UK and Europe operations held for distribution | |
Schedule of fair value of assets and liabilities | The table below shows the assets and liabilities carried at fair value as at each period end indicated, analysed by level of the IFRS 13, ‘ Fair Value Measurement ’ , defined fair value hierarchy. This hierarchy is based on the inputs to the fair value measurement and reflects the lowest level input that is significant to that measurement. 30 Jun 2019 £m Level 1 Level 2 Level 3 Valuation Valuation Quoted prices based on based on (unadjusted) significant significant Analysis of financial investments, net of derivative liabilities in active observable unobservable by business type markets market inputs market inputs Total With-profits Loans — — 1,637 1,637 Equity securities and portfolio holdings in unit trusts 41,593 3,758 392 45,743 Debt securities 7,534 46,410 852 54,796 Other investments (including derivative assets) 66 3,282 5,111 8,459 Derivative liabilities (60) (1,400) (7) (1,467) Total financial investments, net of derivative liabilities 49,133 52,050 7,985 109,168 Percentage of total (%) 45 % 48 % 7 % 100 % Unit-linked Equity securities and portfolio holdings in unit trusts 12,728 939 11 13,678 Debt securities 1,818 6,909 — 8,727 Other investments (including derivative assets) 4 — 7 11 Derivative liabilities (4) (8) — (12) Total financial investments, net of derivative liabilities 14,546 7,840 18 22,404 Percentage of total (%) 65 % 35 % 0 % 100 % Shareholder-backed annuities and other Loans — — 303 303 Equity securities and portfolio holdings in unit trusts 232 — — 232 Debt securities 3,560 17,754 337 21,651 Other investments (including derivative assets) — 527 19 546 Derivative liabilities (1) (1,197) — (1,198) Total financial investments, net of derivative liabilities 3,791 17,084 659 21,534 Percentage of total (%) 18 % 79 % 3 % 100 % UK and Europe total analysis, including other financial liabilities held at fair value Loans — — 1,940 1,940 Equity securities and portfolio holdings in unit trusts 54,553 4,697 403 59,653 Debt securities 12,912 71,073 1,189 85,174 Other investments (including derivative assets) 70 3,809 5,137 9,016 Derivative liabilities (65) (2,605) (7) (2,677) Total financial investments, net of derivative liabilities 67,470 76,974 8,662 153,106 Investment contract liabilities without discretionary participation features held at fair value — (15,695) — (15,695) Borrowings attributable to with-profits businesses — — (1,504) (1,504) Net asset value attributable to unit holders of consolidated unit trusts and similar funds (6,784) (744) (984) (8,512) Other financial liabilities held at fair value — — (379) (379) Total financial instruments at fair value 60,686 60,535 5,795 127,016 Percentage of total (%) 47 % 48 % 5 % 100 % 31 Dec 2018 £m Level 1 Level 2 Level 3 Valuation Valuation Quoted prices based on based on (unadjusted significant significant Analysis of financial investments, net of derivative liabilities in active observable unobservable by business type markets market inputs market inputs Total With-profits Loans — — 1,703 1,703 Equity securities and portfolio holdings in unit trusts 37,027 3,728 335 41,090 Debt securities 8,374 44,619 805 53,798 Other investments (including derivative assets) 56 3,149 4,325 7,530 Derivative liabilities (64) (1,201) — (1,265) Total financial investments, net of derivative liabilities 45,393 50,295 7,168 102,856 Percentage of total (%) 44 % 49 % 7 % 100 % Unit-linked Equity securities and portfolio holdings in unit trusts 12,150 318 9 12,477 Debt securities 1,750 8,762 — 10,512 Other investments (including derivative assets) 4 1 6 11 Derivative liabilities (1) (2) — (3) Total financial investments, net of derivative liabilities 13,903 9,079 15 22,997 Percentage of total (%) 60 % 40 % 0 % 100 % Shareholder-backed annuities and other Loans — — 267 267 Equity securities and portfolio holdings in unit trusts 242 — 1 243 Debt securities 3,804 17,470 372 21,646 Other investments (including derivative assets) 1 554 2 557 Derivative liabilities — (940) — (940) Total financial investments, net of derivative liabilities 4,047 17,084 642 21,773 Percentage of total (%) 19 % 78 % 3 % 100 % UK and Europe total analysis, including other financial liabilities held at fair value Loans — — 1,970 1,970 Equity securities and portfolio holdings in unit trusts 49,419 4,046 345 53,810 Debt securities 13,928 70,851 1,177 85,956 Other investments (including derivative assets) 61 3,704 4,333 8,098 Derivative liabilities (65) (2,143) — (2,208) Total financial investments, net of derivative liabilities 63,343 76,458 7,825 147,626 Investment contract liabilities without discretionary participation features held at fair value — (15,560) — (15,560) Borrowings attributable to with-profits businesses — — (1,606) (1,606) Net asset value attributable to unit holders of consolidated unit trusts and similar funds (7,443) (582) (988) (9,013) Other financial liabilities held at fair value — — (355) (355) Total financial instruments at fair value 55,900 60,316 4,876 121,092 Percentage of total (%) 46 % 50 % 4 % 100 % |
UK & Europe Operations (M&G Prudential) | Fair value of instruments not measured at fair value | |
Discontinued UK and Europe operations held for distribution | |
Schedule of fair value of assets and liabilities | The table below shows the financial assets and liabilities carried at amortised cost on the statement of financial position and their fair value. Cash deposits, accrued income, other debtors, accruals, deferred income and other liabilities are excluded from the analysis below, as these are carried at amortised cost, which approximates fair value. 2019 £m 2018 £m 30 Jun 31 Dec Carrying Fair Carrying Fair value value value value Assets Loans 3,595 4,149 3,597 4,008 Liabilities Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses (114) (114) (106) (106) Borrowings (excluding lease liabilities) attributable to the with-profits funds (2,038) (2,038) (2,315) (2,085) Obligations under funding, securities lending and sale and repurchase agreements (1,054) (1,054) (1,224) (1,224) Total financial instruments carried at amortised cost 389 943 (48) 593 |
UK & Europe Operations (M&G Prudential) | Loans | |
Discontinued UK and Europe operations held for distribution | |
Schedule of amounts included in the statement of financial position | 30 Jun 2019 £m 31 Dec 2018 £m Mortgage Policy Other Mortgage Policy Other loans * loans loans † Total loans* loans loans † Total With-profits 2,260 3 1,493 3,756 2,461 3 1,389 3,853 Non-linked shareholder-backed 1,711 — 68 1,779 1,655 — 59 1,714 Total loans securities 3,971 3 1,561 5,535 4,116 3 1,448 5,567 * All mortgage loans are secured by properties. † Other loans held in the UK with-profits funds are commercial loans and comprise mainly syndicated loans. |
UK & Europe Operations (M&G Prudential) | Debt securities | |
Discontinued UK and Europe operations held for distribution | |
Schedule of securities analysed according to external credit ratings | 30 Jun 2019 £m BBB+ AAA AA+ to AA- A+ to A- to BBB- Below BBB- Other* Total With-profits 5,401 8,488 13,446 15,641 2,824 8,996 54,796 Unit-linked 578 2,025 1,959 2,450 934 781 8,727 Non-linked shareholder-backed 2,791 6,115 4,615 1,655 211 6,264 21,651 Total debt securities 8,770 16,628 20,020 19,746 3,969 16,041 85,174 31 Dec 2018 £m BBB+ to AAA AA+ to AA- A+ to A- BBB- Below BBB- Other* Total With-profits 6,890 9,332 11,779 14,712 2,891 8,194 53,798 Unit-linked 1,041 2,459 2,215 3,501 395 901 10,512 Non-linked shareholder-backed 3,007 6,413 4,651 1,515 158 5,902 21,646 Total debt securities 10,938 18,204 18,645 19,728 3,444 14,997 85,956 |
Schedule of securities with credit ratings classified as "Other" | 2019 £m 2018 £m 30 Jun 31 Dec AAA to A- 8,630 8,150 BBB to B- 2,947 3,034 Below B- or unrated 4,464 3,813 Total UK and Europe 16,041 14,997 |
UK & Europe Operations (M&G Prudential) | Sovereign debt | |
Discontinued UK and Europe operations held for distribution | |
Schedule of amounts included in the statement of financial position | 30 Jun 2019 £m 31 Dec 2018 £m With- With- Shareholder-backed profits Shareholder-backed profits business funds business funds Italy — 59 — 57 Spain 49 19 36 18 France 23 — — 50 Germany* 240 324 239 281 Other Eurozone 100 33 103 34 Total Eurozone 412 435 378 440 United Kingdom 2,235 2,636 2,300 3,013 United States — 632 — 1,261 Other 60 208 57 198 Total 2,707 3,911 2,735 4,912 * Including bonds guaranteed by the federal government. |
UK & Europe Operations (M&G Prudential) | Bank debt securities | |
Discontinued UK and Europe operations held for distribution | |
Schedule of amounts included in the statement of financial position | 30 Jun 2019 £m 2018 £m Senior debt Subordinated debt 31 Dec Shareholder-backed business Covered Senior Total Tier 1 Tier 2 Total Group total Group total Italy — — — — — — — — Spain — — — — — — — — France 21 36 57 — — — 57 20 Germany — — — — 90 90 90 83 Netherlands — 37 37 — — — 37 17 Other Eurozone — — — — — — — — Total Eurozone 21 73 94 — 90 90 184 120 United Kingdom 450 243 693 — 67 67 760 674 United States — 252 252 — 29 29 281 253 Asia — — — — — — — — Other — — — — 36 36 36 40 Total 471 568 1,039 — 222 222 1,261 1,087 With-profits funds Italy — 39 39 — — — 39 38 Spain — 26 26 — — — 26 17 France 6 363 369 — 74 74 443 348 Germany 116 63 179 — 8 8 187 185 Netherlands — 288 288 — — — 288 249 Other Eurozone — 86 86 — — — 86 74 Total Eurozone 122 865 987 — 82 82 1,069 911 United Kingdom 877 873 1,750 52 322 374 2,124 2,096 United States — 2,771 2,771 16 335 351 3,122 2,709 Asia — 127 127 — — — 127 106 Other 506 998 1,504 15 35 50 1,554 1,616 Total 1,505 5,634 7,139 83 774 857 7,996 7,438 |
BACKGROUND - Exchange rates app
BACKGROUND - Exchange rates applied (Details) | 6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||
Jun. 30, 2019₫ / £ | Jun. 30, 2019₫ / £$ / £ | Jun. 30, 2019₫ / £฿ / £ | Jun. 30, 2019₫ / £$ / £ | Jun. 30, 2019₫ / £RM / £ | Jun. 30, 2019₫ / £₨ / £ | Jun. 30, 2019₫ / £Rp / £ | Jun. 30, 2019₫ / £$ / £ | Jun. 30, 2019₫ / £¥ / £ | Jun. 30, 2018₫ / £ | Jun. 30, 2018₫ / £$ / £ | Jun. 30, 2018₫ / £฿ / £ | Jun. 30, 2018₫ / £$ / £ | Jun. 30, 2018₫ / £RM / £ | Jun. 30, 2018₫ / £₨ / £ | Jun. 30, 2018₫ / £Rp / £ | Jun. 30, 2018₫ / £$ / £ | Jun. 30, 2018₫ / £¥ / £ | Jun. 30, 2019$ / £ | Jun. 30, 2019฿ / £ | Jun. 30, 2019$ / £ | Jun. 30, 2019RM / £ | Jun. 30, 2019₨ / £ | Jun. 30, 2019Rp / £ | Jun. 30, 2019$ / £ | Jun. 30, 2019¥ / £ | Dec. 31, 2018₫ / £ | Dec. 31, 2018$ / £ | Dec. 31, 2018฿ / £ | Dec. 31, 2018$ / £ | Dec. 31, 2018RM / £ | Dec. 31, 2018₨ / £ | Dec. 31, 2018Rp / £ | Dec. 31, 2018$ / £ | Dec. 31, 2018¥ / £ | Jun. 30, 2018$ / £ | Jun. 30, 2018฿ / £ | Jun. 30, 2018$ / £ | Jun. 30, 2018RM / £ | Jun. 30, 2018₨ / £ | Jun. 30, 2018Rp / £ | Jun. 30, 2018$ / £ | Jun. 30, 2018¥ / £ | |
BACKGROUND | |||||||||||||||||||||||||||||||||||||||||||
Closing rate | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 1.27 | 39.06 | 1.72 | 5.26 | 87.85 | 17,980.07 | 9.94 | 8.74 | 29,541.15 | 1.27 | 41.47 | 1.74 | 5.26 | 88.92 | 18,314.37 | 9.97 | 8.74 | 1.32 | 43.74 | 1.80 | 5.33 | 90.46 | 18,919.18 | 10.36 | 8.75 |
Average rate | 30,087.11 | 1.29 | 40.91 | 1.76 | 5.33 | 90.62 | 18,364.05 | 10.15 | 8.78 | 31,329.01 | 1.38 | 43.66 | 1.83 | 5.42 | 90.37 | 18,938.64 | 10.78 | 8.76 |
BACKGROUND - New accounting pro
BACKGROUND - New accounting pronouncements (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | ||
Disclosure of initial application of standards or interpretations [line items] | ||||
Weighted-average rate (as a percent) | 3.40% | |||
Assets | ||||
Property, plant and equipment (Right-of-use assets) | £ 785 | [1] | £ 378 | |
Total assets | 554,683 | |||
Liabilities | ||||
Operational borrowings attributable to shareholder-financed businesses (Lease liability) | [1] | 1,664 | ||
Borrowings attributable to with-profits businesses (Lease liability) | [1] | 238 | ||
Accruals, deferred income and other liabilities (Accrued lease payment balance under IAS 17) | 10,597 | |||
Total liabilities | 534,988 | |||
UK & Europe Operations (M&G Prudential) | ||||
Assets | ||||
Property, plant and equipment (Right-of-use assets) | 1,433 | 1,031 | ||
Total assets | 221,126 | 209,201 | ||
Liabilities | ||||
Operational borrowings attributable to shareholder-financed businesses (Lease liability) | 456 | 106 | ||
Borrowings attributable to with-profits businesses (Lease liability) | 3,580 | 3,921 | ||
Accruals, deferred income and other liabilities (Accrued lease payment balance under IAS 17) | 9,517 | 6,442 | ||
Total liabilities | £ 212,846 | 200,501 | ||
Continuing and discontinued operations | ||||
Assets | ||||
Property, plant and equipment (Right-of-use assets) | [1] | 1,409 | ||
Total assets | 508,645 | |||
Liabilities | ||||
Operational borrowings attributable to shareholder-financed businesses (Lease liability) | [1] | 998 | ||
Borrowings attributable to with-profits businesses (Lease liability) | [1] | 3,940 | ||
Accruals, deferred income and other liabilities (Accrued lease payment balance under IAS 17) | 15,248 | |||
Total liabilities | 491,378 | |||
Effect of IFRS 16 | ||||
Assets | ||||
Property, plant and equipment (Right-of-use assets) | 414 | |||
Total assets | 414 | |||
Liabilities | ||||
Operational borrowings attributable to shareholder-financed businesses (Lease liability) | 206 | |||
Borrowings attributable to with-profits businesses (Lease liability) | 219 | |||
Accruals, deferred income and other liabilities (Accrued lease payment balance under IAS 17) | (11) | |||
Total liabilities | 414 | |||
Effect of IFRS 16 | UK & Europe Operations (M&G Prudential) | ||||
Assets | ||||
Property, plant and equipment (Right-of-use assets) | 289 | |||
Total assets | 289 | |||
Liabilities | ||||
Operational borrowings attributable to shareholder-financed businesses (Lease liability) | 304 | |||
Borrowings attributable to with-profits businesses (Lease liability) | 21 | |||
Accruals, deferred income and other liabilities (Accrued lease payment balance under IAS 17) | (36) | |||
Total liabilities | 289 | |||
Effect of IFRS 16 | Continuing and discontinued operations | ||||
Assets | ||||
Property, plant and equipment (Right-of-use assets) | 703 | |||
Total assets | 703 | |||
Liabilities | ||||
Operational borrowings attributable to shareholder-financed businesses (Lease liability) | 510 | |||
Borrowings attributable to with-profits businesses (Lease liability) | 240 | |||
Accruals, deferred income and other liabilities (Accrued lease payment balance under IAS 17) | (47) | |||
Total liabilities | £ 703 | |||
[1] | As at 1 January 2019, the Group applied IFRS 16, ‘Leases’, using the modified retrospective approach. Under this approach, comparative information is not restated. The application of the standard has resulted in the recognition of an additional lease liability and a corresponding ‘right-of-use’ asset of a similar amount as at 1 January 2019. See note A3 for further details. As at 30 June 2019, right-of-use assets recognised in property, plant and equipment for continuing operations amounted to £425 million. |
Analysis of performance by se_3
Analysis of performance by segment - Segment results (Details) - GBP (£) £ / shares in Units, £ in Millions | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | ||
Other income and expenditure | |||
Interest payable on core structural borrowings | £ (226) | £ (189) | |
Adjusted IFRS operating profit (loss) based on longer-term investment returns from continuing operations | 2,024 | 1,669 | |
Short-term fluctuations in investment returns on shareholder-backed business | (1,124) | 9 | |
Amortisation of acquisition accounting adjustments | (17) | (22) | |
Gain (loss) on disposal of businesses and corporate transactions | 13 | (57) | |
Profit from continuing operations before tax attributable to shareholders | 896 | 1,599 | |
Tax charge attributable to shareholders' returns | (1) | (326) | |
Profit from continuing operations for the period | 895 | 1,273 | |
Profit from discontinued operations for the period, net of related tax | [1] | 645 | 83 |
Profit for the period | 1,540 | 1,356 | |
Attributable to: | |||
Equity holders of the Company from continuing operations | 890 | 1,272 | |
Equity holders of the Company from discontinued operations | 645 | 83 | |
Non-controlling interests from continuing operations | £ 5 | £ 1 | |
Basic earnings per share | |||
Based on adjusted IFRS operating profit based on longer-term investment returns, net of tax, from continuing operations | £ 0.653 | £ 0.537 | |
Based on profit for the period from continuing operations | 0.344 | 0.495 | |
Based on profit for the period from discontinued operations | [1] | £ 0.250 | £ 0.032 |
Subordinated debt capable of being substituted to M&GPrudential as at 30 Jun 2019 | |||
Other income and expenditure | |||
Interest payable on core structural borrowings | £ (85) | £ (35) | |
Operating segments | US and Asia | |||
Other income and expenditure | |||
Adjusted IFRS operating profit (loss) based on longer-term investment returns from continuing operations | 2,413 | 2,018 | |
Operating segments | Asia | |||
Other income and expenditure | |||
Adjusted IFRS operating profit (loss) based on longer-term investment returns from continuing operations | 1,198 | 1,016 | |
Short-term fluctuations in investment returns on shareholder-backed business | 420 | (326) | |
Profit from continuing operations before tax attributable to shareholders | 1,825 | 678 | |
Tax charge attributable to shareholders' returns | (188) | (139) | |
Operating segments | Asia insurance operations | |||
Other income and expenditure | |||
Adjusted IFRS operating profit (loss) based on longer-term investment returns from continuing operations | 1,095 | 927 | |
Operating segments | Asia asset management | |||
Other income and expenditure | |||
Adjusted IFRS operating profit (loss) based on longer-term investment returns from continuing operations | 103 | 89 | |
Operating segments | US | |||
Other income and expenditure | |||
Adjusted IFRS operating profit (loss) based on longer-term investment returns from continuing operations | 1,215 | 1,002 | |
Short-term fluctuations in investment returns on shareholder-backed business | (1,521) | 244 | |
Profit from continuing operations before tax attributable to shareholders | (321) | 1,186 | |
Tax charge attributable to shareholders' returns | 111 | (216) | |
Operating segments | Jackson (US insurance operations) | |||
Other income and expenditure | |||
Adjusted IFRS operating profit (loss) based on longer-term investment returns from continuing operations | 1,203 | 1,001 | |
Short-term fluctuations in investment returns on shareholder-backed business | (1,521) | 244 | |
Operating segments | Asset management (US) | |||
Other income and expenditure | |||
Adjusted IFRS operating profit (loss) based on longer-term investment returns from continuing operations | 12 | 1 | |
Operating profit reconciling items | |||
Other income and expenditure | |||
Investment return and other income | 24 | 33 | |
Interest payable on core structural borrowings | (226) | (189) | |
Corporate expenditure | (164) | (173) | |
Total other income and expenditure | (366) | (329) | |
Restructuring costs | (23) | £ (20) | |
Operating profit reconciling items | Subordinated debt capable of being substituted to M&GPrudential as at 30 Jun 2019 | |||
Other income and expenditure | |||
Interest payable on core structural borrowings | £ (85) | ||
[1] | Profit from discontinued operations represents the post-tax profit contributed by the UK and Europe operations which are classified as held for distribution at 30 June 2019 (a line-by-line analysis of profit for the period for the discontinued UK and Europe operations is included in note D2.1).The half year 2018 comparative results have been re-presented from those previously published accordingly (as described in note A2). |
Analysis of performance by se_4
Analysis of performance by segment - Short-term fluctuations in investment returns on shareholder-backed business (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Analysis of operating segments | ||
Short-term fluctuations in investment returns on shareholder-backed business | £ (1,124) | £ 9 |
Operating segments | Asia | ||
Analysis of operating segments | ||
Short-term fluctuations in investment returns on shareholder-backed business | 420 | (326) |
Operating segments | US | ||
Analysis of operating segments | ||
Short-term fluctuations in investment returns on shareholder-backed business | (1,521) | 244 |
Operating segments | Jackson (US insurance operations) | ||
Analysis of operating segments | ||
Related credit (charge) for amortisation of deferred acquisition costs | 476 | (199) |
Short-term fluctuations in investment returns on shareholder-backed business | (1,521) | 244 |
Operating segments | Jackson (US insurance operations) | Net equity hedge result | ||
Analysis of operating segments | ||
Fair value movements on equity hedge instruments | (2,466) | (375) |
Accounting value movements on the variable and fixed index annuity guarantee liabilities | 227 | 505 |
Fee assessments net of claim payments | 284 | 253 |
Short-term fluctuations in investment returns on shareholder-backed business | (1,955) | 383 |
Operating segments | Jackson (US insurance operations) | Other than equity-related derivatives | ||
Analysis of operating segments | ||
Short-term fluctuations in investment returns on shareholder-backed business | 433 | (183) |
Operating segments | Jackson (US insurance operations) | Debt securities | ||
Analysis of operating segments | ||
Short-term fluctuations in investment returns on shareholder-backed business | 11 | 6 |
Operating segments | Jackson (US insurance operations) | Equity-type securities such as common and preferred stock and portfolio holdings in mutual funds | ||
Analysis of operating segments | ||
Short-term fluctuations in investment returns on shareholder-backed business | (7) | 31 |
Operating segments | Jackson (US insurance operations) | Other items | ||
Analysis of operating segments | ||
Short-term fluctuations in investment returns on shareholder-backed business | (3) | 7 |
Unallocated to a segment (central or other operations) | ||
Analysis of operating segments | ||
Short-term fluctuations in investment returns on shareholder-backed business | £ (23) | £ 91 |
Analysis of performance by se_5
Analysis of performance by segment - Short-term fluctuations related to debt securities (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Interest-related realised (losses) gains: | ||
Total short-term fluctuations related to debt securities | £ (1,124) | £ 9 |
Operating segments | Jackson (US insurance operations) | ||
Interest-related realised (losses) gains: | ||
Total short-term fluctuations related to debt securities | (1,521) | 244 |
Operating segments | Jackson (US insurance operations) | Debt securities | ||
(Charges) credits in the period: | ||
Losses on sales of impaired and deteriorating bonds | (19) | (1) |
Bond write-downs | (1) | (2) |
Recoveries/reversals | 1 | 18 |
Total (charges) credits in the period | (19) | 15 |
Risk margin allowance deducted from adjusted IFRS operating profit based on longer-term investment returns | 42 | 38 |
Total credits (charge) in the period, net of risk margin allowance | 23 | 53 |
Interest-related realised (losses) gains: | ||
Gains (losses) arising in the period | 33 | 8 |
Amortisation of gains and losses arising in current and prior years to adjusted IFRS operating profit based on longer-term investment returns | (46) | (57) |
Total interest-related realised (losses) gains | (13) | (49) |
Related amortisation of deferred acquisition costs | 1 | 2 |
Total short-term fluctuations related to debt securities | £ 11 | £ 6 |
Analysis of performance by se_6
Analysis of performance by segment - Risk margin reserve (Details) £ in Millions, $ in Millions | 6 Months Ended | ||||||
Jun. 30, 2019USD ($) | Jun. 30, 2019GBP (£) | Jun. 30, 2018USD ($) | Jun. 30, 2018GBP (£) | Jun. 30, 2019GBP (£) | Dec. 31, 2018GBP (£) | ||
Risk margin reserve | |||||||
Debt securities | £ | £ 99,675 | [1] | £ 89,400 | ||||
Jackson (US insurance operations) | Debt securities | |||||||
Risk margin reserve | |||||||
RMR (as a percent) | 0.18% | 0.19% | 0.18% | ||||
Annual expected loss | $ (108) | £ (83) | $ (104) | £ (75) | |||
Related amortisation of deferred acquisition costs | 18 | 14 | 22 | 15 | |||
Risk margin reserve charge to adjusted IFRS operating profit for longer-term credit related losses | (90) | (69) | (82) | (60) | |||
Pre-tax net unrealised gains/(losses) on debt securities classified as available-for-sale | £ | 2,185 | (1,149) | |||||
Jackson (US insurance operations) | Debt securities | Cost/Gross amount | Average | |||||||
Risk margin reserve | |||||||
Debt securities | $ 59,994 | $ 54,895 | |||||
Jackson (US insurance operations) | Debt securities | A3 or higher | |||||||
Risk margin reserve | |||||||
RMR (as a percent) | 0.10% | 0.11% | 0.10% | ||||
Annual expected loss | $ (36) | (28) | $ (29) | (21) | |||
Jackson (US insurance operations) | Debt securities | A3 or higher | Cost/Gross amount | Average | |||||||
Risk margin reserve | |||||||
Debt securities | $ 34,318 | $ 26,260 | |||||
Jackson (US insurance operations) | Debt securities | Baa1, 2 or 3 | |||||||
Risk margin reserve | |||||||
RMR (as a percent) | 0.23% | 0.20% | 0.23% | ||||
Annual expected loss | $ (55) | (42) | $ (57) | (41) | |||
Jackson (US insurance operations) | Debt securities | Baa1, 2 or 3 | Cost/Gross amount | Average | |||||||
Risk margin reserve | |||||||
Debt securities | $ 24,385 | $ 27,337 | |||||
Jackson (US insurance operations) | Debt securities | Ba1, 2 or 3 | |||||||
Risk margin reserve | |||||||
RMR (as a percent) | 0.93% | 1.01% | 0.93% | ||||
Annual expected loss | $ (10) | (7) | $ (10) | (7) | |||
Jackson (US insurance operations) | Debt securities | Ba1, 2 or 3 | Cost/Gross amount | Average | |||||||
Risk margin reserve | |||||||
Debt securities | $ 1,008 | $ 978 | |||||
Jackson (US insurance operations) | Debt securities | B1, 2 or 3 | |||||||
Risk margin reserve | |||||||
RMR (as a percent) | 2.62% | 2.61% | 2.62% | ||||
Annual expected loss | $ (6) | (5) | $ (8) | £ (6) | |||
Jackson (US insurance operations) | Debt securities | B1, 2 or 3 | Cost/Gross amount | Average | |||||||
Risk margin reserve | |||||||
Debt securities | $ 246 | $ 309 | |||||
Jackson (US insurance operations) | Debt securities | Below B3 | |||||||
Risk margin reserve | |||||||
RMR (as a percent) | 3.42% | 3.71% | 3.42% | ||||
Annual expected loss | $ (1) | £ (1) | |||||
Jackson (US insurance operations) | Debt securities | Below B3 | Cost/Gross amount | Average | |||||||
Risk margin reserve | |||||||
Debt securities | $ 37 | $ 11 | |||||
[1] | Included within equity securities and portfolio holdings in unit trusts, debt securities and other investments are £8 million of lent securities as at 30 June 2019 (31 December 2018: £8,278 million). |
Analysis of performance by se_7
Analysis of performance by segment - Performance measure (Details) £ in Millions | 6 Months Ended | |
Jun. 30, 2019GBP (£)segment | Jun. 30, 2018GBP (£) | |
Analysis of operating segments | ||
Number of operating segments | segment | 3 | |
Unamortised interest-related realised gains and losses related to previously sold bonds | £ 580 | £ 800 |
Equity-type securities | ||
Financial investments | 299,529 | |
Asia insurance operations | Non-linked shareholder-backed | Equity-type securities | ||
Equity-type securities | ||
Financial investments | £ 2,282 | £ 1,622 |
Asia insurance operations | Non-linked shareholder-backed | Equity-type securities | Minimum | ||
Equity-type securities | ||
Longer-term rates of return (as a percent) | 5.20% | 5.10% |
Asia insurance operations | Non-linked shareholder-backed | Equity-type securities | Maximum | ||
Equity-type securities | ||
Longer-term rates of return (as a percent) | 17.60% | 17.20% |
Jackson (US insurance operations) | Non-separate account operations | Equity-type securities | ||
Equity-type securities | ||
Financial investments | £ 1,178 | £ 1,187 |
Jackson (US insurance operations) | Non-separate account operations | Equity-type securities such as common and preferred stock and portfolio holdings in mutual funds | Minimum | ||
Equity-type securities | ||
Longer-term rates of return (as a percent) | 6.00% | 6.70% |
Jackson (US insurance operations) | Non-separate account operations | Equity-type securities such as common and preferred stock and portfolio holdings in mutual funds | Maximum | ||
Equity-type securities | ||
Longer-term rates of return (as a percent) | 6.70% | 7.00% |
Jackson (US insurance operations) | Non-separate account operations | Other equity-type securities such as investments in limited partnerships and private equity funds | Minimum | ||
Equity-type securities | ||
Longer-term rates of return (as a percent) | 8.00% | 8.70% |
Jackson (US insurance operations) | Non-separate account operations | Other equity-type securities such as investments in limited partnerships and private equity funds | Maximum | ||
Equity-type securities | ||
Longer-term rates of return (as a percent) | 8.70% | 9.00% |
Analysis of performance by se_8
Analysis of performance by segment - Additional segmental analysis of revenue from continuing operations (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Analysis of operating segments | ||
Gross premiums earned | £ 16,293 | £ 14,786 |
Outward reinsurance premiums | (520) | (363) |
Earned premiums, net of reinsurance | 15,773 | 14,423 |
Other income | 199 | 215 |
Total revenue | 15,972 | 14,638 |
Interest income | 1,771 | 1,479 |
Other investment return | 22,862 | (98) |
Total revenue, net of reinsurance | 40,605 | 16,019 |
Asset management business | ||
Analysis of operating segments | ||
Other income | 153 | 108 |
Operating segments after elimination, before unallocated | ||
Analysis of operating segments | ||
Gross premiums earned | 16,266 | 14,772 |
Outward reinsurance premiums | (517) | (363) |
Earned premiums, net of reinsurance | 15,749 | 14,409 |
Other income | 187 | 201 |
Total revenue | 15,936 | 14,610 |
Operating segments after elimination, before unallocated | Asia | ||
Analysis of operating segments | ||
Gross premiums earned | 8,856 | 7,736 |
Outward reinsurance premiums | (386) | (222) |
Earned premiums, net of reinsurance | 8,470 | 7,514 |
Other income | 176 | 157 |
Total revenue | 8,646 | 7,671 |
Operating segments after elimination, before unallocated | US | ||
Analysis of operating segments | ||
Gross premiums earned | 7,410 | 7,036 |
Outward reinsurance premiums | (131) | (141) |
Earned premiums, net of reinsurance | 7,279 | 6,895 |
Other income | 11 | 44 |
Total revenue | 7,290 | 6,939 |
Operating segments | ||
Analysis of operating segments | ||
Interest income | 1,750 | 1,453 |
Other investment return | 22,844 | (217) |
Total revenue, net of reinsurance | 40,570 | 15,898 |
Operating segments | Asia | ||
Analysis of operating segments | ||
Interest income | 622 | 513 |
Other investment return | 6,821 | (1,703) |
Total revenue, net of reinsurance | 16,105 | 6,501 |
Operating segments | US | ||
Analysis of operating segments | ||
Interest income | 1,128 | 940 |
Other investment return | 16,023 | 1,486 |
Total revenue, net of reinsurance | 24,465 | 9,397 |
Unallocated to a segment (other operations) - including intra-group eliminations | ||
Analysis of operating segments | ||
Total revenue, net of reinsurance | 35 | 121 |
Elimination of intra-group amounts | ||
Analysis of operating segments | ||
Total revenue | (40) | (52) |
Elimination of intra-group amounts | Asia | ||
Analysis of operating segments | ||
Total revenue | (16) | (20) |
Elimination of intra-group amounts | US | ||
Analysis of operating segments | ||
Total revenue | (24) | (32) |
Unallocated to a segment (central or other operations) | ||
Analysis of operating segments | ||
Gross premiums earned | 27 | 14 |
Outward reinsurance premiums | (3) | |
Earned premiums, net of reinsurance | 24 | 14 |
Other income | 12 | 14 |
Total revenue | 36 | 28 |
Interest income | 21 | 26 |
Other investment return | £ 18 | £ 119 |
Acquisition costs and other e_3
Acquisition costs and other expenditure from continuing operations (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Acquisition costs and other expenditure from continuing operations | ||
Acquisition costs incurred for insurance policies | £ (1,630) | £ (1,538) |
Acquisition costs deferred less amortisation of acquisition costs | 774 | (61) |
Administration costs and other expenditure | (1,771) | (1,625) |
Movements in amounts attributable to external unit holders of consolidated investment funds | (84) | (61) |
Total acquisition costs and other expenditure from continuing operations | (2,711) | (3,285) |
Depreciation of property, plant and equipment | (83) | £ (34) |
Depreciation charge from the right-of-use assets | £ (51) |
Effect of changes and other a_2
Effect of changes and other accounting matters on insurance assets and liabilities (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Operating segments | Asia insurance operations | ||
Effect of changes and other accounting matters on insurance | ||
Non-recurring items included in operating profit based on longer-term investment returns | £ 76 | £ 69 |
Tax charge from continuing op_3
Tax charge from continuing operations - Total tax charge by nature of expense from continuing operations (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Tax charge attributable to shareholders: | ||
Current tax attributable to shareholders | £ (185) | |
Deferred tax attributable to shareholders | 184 | |
Tax (charge) credit attributable to shareholders' returns | (1) | £ (326) |
Tax charge attributable to policyholders: | ||
Tax charge attributable to policyholders | (220) | (43) |
Total current tax charge | (239) | |
Total deferred tax credit | 18 | |
Total tax charge | (221) | (369) |
Operating segments | Asia | ||
Tax charge attributable to shareholders: | ||
Current tax attributable to shareholders | (139) | |
Deferred tax attributable to shareholders | (49) | |
Tax (charge) credit attributable to shareholders' returns | (188) | (139) |
Tax charge attributable to policyholders: | ||
Current tax to attributable policyholders | (54) | |
Deferred tax attributable to policyholders | (166) | |
Tax charge attributable to policyholders | (220) | (43) |
Operating segments | US | ||
Tax charge attributable to shareholders: | ||
Current tax attributable to shareholders | (130) | |
Deferred tax attributable to shareholders | 241 | |
Tax (charge) credit attributable to shareholders' returns | 111 | (216) |
Unallocated to a segment (central or other operations) | ||
Tax charge attributable to shareholders: | ||
Current tax attributable to shareholders | 84 | |
Deferred tax attributable to shareholders | (8) | |
Tax (charge) credit attributable to shareholders' returns | £ 76 | £ 29 |
Tax charge from continuing op_4
Tax charge from continuing operations - Shareholder profit and tax charge from continuing operations (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Reconciliation of effective tax rate | ||
Adjusted IFRS operating profit (loss) based on longer-term investment returns from continuing operations | £ 2,024 | £ 1,669 |
Non-operating profit (loss) | (1,128) | (70) |
Profit (loss) before tax, attributable to shareholders | 896 | 1,599 |
Tax charge (credit) on: | ||
Tax on adjusted IFRS operating profit (loss) based on longer-term investment returns | 332 | 287 |
Tax on non-operating profit (loss) | (331) | 39 |
Total actual tax charge (credit), attributable to shareholders | £ 1 | £ 326 |
Actual tax rate on: | ||
Adjusted IFRS operating profit based on longer-term investment returns | 16.00% | 17.00% |
Profit before tax | 0.10% | 20.40% |
Operating segments | Asia | ||
Reconciliation of effective tax rate | ||
Adjusted IFRS operating profit (loss) based on longer-term investment returns from continuing operations | £ 1,198 | £ 1,016 |
Non-operating profit (loss) | 627 | (338) |
Profit (loss) before tax, attributable to shareholders | 1,825 | 678 |
Tax charge (credit) on: | ||
Tax on adjusted IFRS operating profit (loss) based on longer-term investment returns | 168 | 151 |
Tax on non-operating profit (loss) | 20 | (12) |
Total actual tax charge (credit), attributable to shareholders | £ 188 | £ 139 |
Actual tax rate on: | ||
Adjusted IFRS operating profit based on longer-term investment returns | 14.00% | 15.00% |
Profit before tax | 10.00% | 21.00% |
Operating segments | US | ||
Reconciliation of effective tax rate | ||
Adjusted IFRS operating profit (loss) based on longer-term investment returns from continuing operations | £ 1,215 | £ 1,002 |
Non-operating profit (loss) | (1,536) | 184 |
Profit (loss) before tax, attributable to shareholders | (321) | 1,186 |
Tax charge (credit) on: | ||
Tax on adjusted IFRS operating profit (loss) based on longer-term investment returns | 203 | 177 |
Tax on non-operating profit (loss) | (314) | 39 |
Total actual tax charge (credit), attributable to shareholders | £ (111) | £ 216 |
Actual tax rate on: | ||
Adjusted IFRS operating profit based on longer-term investment returns | 17.00% | 18.00% |
Profit before tax | 35.00% | 18.00% |
Unallocated to a segment (central or other operations) | ||
Reconciliation of effective tax rate | ||
Adjusted IFRS operating profit (loss) based on longer-term investment returns from continuing operations | £ (389) | £ (349) |
Non-operating profit (loss) | (219) | 84 |
Profit (loss) before tax, attributable to shareholders | (608) | (265) |
Tax charge (credit) on: | ||
Tax on adjusted IFRS operating profit (loss) based on longer-term investment returns | (39) | (41) |
Tax on non-operating profit (loss) | (37) | 12 |
Total actual tax charge (credit), attributable to shareholders | £ (76) | £ (29) |
Actual tax rate on: | ||
Adjusted IFRS operating profit based on longer-term investment returns | 10.00% | 12.00% |
Profit before tax | 13.00% | 11.00% |
Tax charge from continuing op_5
Tax charge from continuing operations - Reconciliation of shareholder effective tax rate from continuing operations (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Reconciliation of shareholder effective tax rate from continuing operations | ||
Profit (loss) before tax, attributable to shareholders | £ 896 | £ 1,599 |
Expected tax rate (ETR) | 20.00% | 22.00% |
Tax at the expected rate | £ 179 | £ 352 |
Tax at the expected rate | 20.00% | 22.00% |
Effects of recurring tax reconciliation items and percentage impact on ETR: | ||
Income not taxable or taxable at concessionary rates | £ (54) | £ (19) |
Income not taxable or taxable at concessionary rates, percentage impact on ETR | (6.00%) | (1.20%) |
Deductions not allowable for tax purposes | £ 23 | £ 25 |
Deductions not allowable for tax purposes, percentage impact on ETR | 2.60% | 1.60% |
Items related to taxation of life insurance businesses | £ (138) | £ (36) |
Items related to taxation of life insurance businesses, percentage impact on ETR | (15.40%) | (2.30%) |
Deferred tax adjustments | £ (9) | £ (17) |
Deferred tax adjustments, percentage impact on ETR | (1.00%) | (1.10%) |
Effect of results of joint ventures and associates | £ (27) | £ (20) |
Effect of results of joint ventures and associates, percentage impact on ETR | (3.00%) | (1.30%) |
Irrecoverable withholding taxes | £ 21 | £ 26 |
Irrecoverable withholding taxes, percentage impact on ETR | 2.30% | 1.80% |
Other | £ 4 | |
Other, percentage impact on ETR | 0.40% | |
Total effects of recurring tax reconciliation items | £ (180) | £ (41) |
Total tax rate, Effects of recurring tax reconciliation items | (20.10%) | (2.50%) |
Effects of non-recurring tax reconciliation items: | ||
Adjustments to tax charge in relation to prior years | £ 15 | £ 7 |
Adjustments to tax charge in relation to prior years, percentage impact on ETR | 1.70% | 0.40% |
Movements in provisions for open tax matters | £ 6 | £ 8 |
Movements in provisions for open tax matters, percentage impact on ETR | 0.70% | 0.50% |
Adjustments in relation to business disposals | £ (19) | |
Adjustments in relation to business disposals | (2.20%) | |
Total effects of non-recurring tax reconciliation items | £ 2 | £ 15 |
Total tax rate, Effects of non-recurring tax reconciliation items | 0.20% | 0.90% |
Total actual tax charge | £ 1 | £ 326 |
Total actual tax charge | 0.10% | 20.40% |
Hong Kong | ||
Effects of recurring tax reconciliation items and percentage impact on ETR: | ||
Items related to taxation of life insurance businesses | £ (82) | |
Effects of non-recurring tax reconciliation items: | ||
Percentage of net insurance premium used to calculate income tax charge | 5.00% |
Tax charge from continuing op_6
Tax charge from continuing operations - Provision for open tax matters (Details) £ in Millions | 6 Months Ended |
Jun. 30, 2019GBP (£) | |
Movements in provisions for open tax matters | |
Provision for open tax matters at beginning of period | £ (149) |
Movements in the current period included in tax charge attributable to shareholders | (6) |
Other movements | (1) |
Provision for open tax matters at end of period | £ (156) |
Earnings per share - Calculatio
Earnings per share - Calculation (Details) - GBP (£) £ / shares in Units, £ in Millions | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | ||
Before tax | |||
Based on adjusted IFRS operating profit based on longer-term investment returns | £ 2,024 | £ 1,669 | |
Short-term fluctuations in investment returns on shareholder-backed business | (1,124) | 9 | |
Amortisation of acquisition accounting adjustments | (17) | (22) | |
Gain (loss) on disposal of businesses and corporate transactions | 13 | (57) | |
Profit before tax attributable to shareholders | 896 | 1,599 | |
Tax | |||
Based on adjusted IFRS operating profit based on longer-term investment returns | (332) | (287) | |
Short-term fluctuations in investment returns on shareholder-backed business | 314 | (51) | |
Amortisation of acquisition accounting adjustments | 3 | 4 | |
Gain (loss) on disposal of businesses and corporate transactions | 14 | 8 | |
Tax (charge) credit attributable to shareholders' returns | (1) | (326) | |
Non-controlling interests | |||
Based on adjusted IFRS operating profit based on longer-term investment returns | (5) | (1) | |
Based on profit for the period | (5) | (1) | |
Net of tax and non-controlling interests | |||
Based on adjusted IFRS operating profit based on longer-term investment returns | 1,687 | 1,381 | |
Short-term fluctuations in investment returns on shareholder-backed business | (810) | (42) | |
Amortisation of acquisition accounting adjustments | (14) | (18) | |
Gain (loss) on disposal of businesses and corporate transactions | 27 | (49) | |
Based on profit for the period from continuing operations | 890 | 1,272 | |
Based on profit for the period from discontinued operations | £ 645 | £ 83 | |
Basic | |||
Based on adjusted IFRS operating profit based on longer-term investment returns (in GBP per share) | £ 0.653 | £ 0.537 | |
Short-term fluctuations in investment returns on shareholder-backed business (in GBP per share) | (0.314) | (0.016) | |
Amortisation of acquisition accounting adjustments (in GBP per share) | (0.005) | (0.007) | |
Gain (loss) on disposal of businesses and corporate transactions | 0.010 | (0.019) | |
Based on profit from continuing operations (in GBP per share) | 0.344 | 0.495 | |
Based on profit from discontinued operations (in GBP per share) | [1] | 0.250 | 0.032 |
Basic (in GBP per share) | 0.594 | 0.527 | |
Diluted | |||
Based on adjusted IFRS operating profit based on longer-term investment returns (in GBP per share) | 0.653 | 0.536 | |
Short-term fluctuations in investment returns on shareholder-backed business (in GBP per share) | (0.314) | (0.016) | |
Amortisation of acquisition accounting adjustments (in GBP per share) | (0.005) | (0.007) | |
Gain (loss) on disposal of businesses and corporate transactions | 0.010 | (0.019) | |
Based on profit from continuing operations (in GBP per share) | 0.344 | 0.494 | |
Based on profit from discontinued operations (in GBP per share) | [1] | 0.250 | 0.032 |
Diluted (in GBP per share) | £ 0.594 | £ 0.526 | |
UK & Europe Operations (M&G Prudential) | |||
Before tax | |||
Profit before tax attributable to shareholders | £ 817 | £ 101 | |
Tax | |||
Tax (charge) credit attributable to shareholders' returns | (172) | (18) | |
Net of tax and non-controlling interests | |||
Based on profit for the period from discontinued operations | £ 645 | £ 83 | |
Basic | |||
Based on profit from discontinued operations (in GBP per share) | £ 0.250 | £ 0.032 | |
Diluted | |||
Based on profit from discontinued operations (in GBP per share) | £ 0.250 | £ 0.032 | |
Continuing and discontinued operations | |||
Before tax | |||
Profit before tax attributable to shareholders | £ 1,713 | £ 1,700 | |
Tax | |||
Tax (charge) credit attributable to shareholders' returns | (173) | (344) | |
Non-controlling interests | |||
Based on profit for the period | (5) | (1) | |
Net of tax and non-controlling interests | |||
Based on profit for the period | £ 1,535 | £ 1,355 | |
Basic | |||
Basic (in GBP per share) | £ 0.594 | £ 0.527 | |
Diluted | |||
Diluted (in GBP per share) | £ 0.594 | £ 0.526 | |
[1] | Profit from discontinued operations represents the post-tax profit contributed by the UK and Europe operations which are classified as held for distribution at 30 June 2019 (a line-by-line analysis of profit for the period for the discontinued UK and Europe operations is included in note D2.1).The half year 2018 comparative results have been re-presented from those previously published accordingly (as described in note A2). |
Earnings per share - Weighted a
Earnings per share - Weighted average shares (Details) - shares shares in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Weighted average number of shares for calculating earnings per share | ||
Basic earnings per share | 2,583 | 2,573 |
Diluted earnings per share | 2,584 | 2,574 |
Dividends (Details)
Dividends (Details) - GBP (£) £ / shares in Units, £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Dividends relating to reporting period: | ||
First interim ordinary dividend (in GBP per share) | £ 0.1645 | £ 0.1567 |
First interim ordinary dividend | £ 428 | £ 406 |
Dividends paid in reporting period: | ||
Second interim ordinary dividend for prior year (in GBP per share) | £ 0.3368 | £ 0.3250 |
Second interim ordinary dividend for prior year | £ 870 | £ 840 |
Analysis of Group statement o_3
Analysis of Group statement of financial position by segment (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2017 | |
Assets | |||||
Goodwill | £ 510 | ||||
Deferred acquisition costs and other intangible assets | 12,659 | ||||
Reinsurers' share of insurance contract liabilities | 10,151 | ||||
Other assets | 7,261 | ||||
Investment properties | 11 | ||||
Investment in joint ventures and associates accounted for using the equity method | 1,030 | ||||
Financial investments | 299,529 | ||||
Assets held for distribution | [1] | 218,324 | |||
Cash and cash equivalents | 5,208 | £ 5,030 | |||
Total assets | 554,683 | ||||
Total equity | 19,695 | £ 17,267 | 15,890 | £ 16,094 | |
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 285,168 | ||||
Unallocated surplus of with-profits funds | 2,944 | ||||
Core structural borrowings of shareholder-financed businesses | 7,441 | ||||
Operational borrowings attributable to shareholder-financed businesses | [2] | 1,664 | |||
Borrowings attributable to with-profits businesses | [2] | 238 | |||
Other liabilities | 26,146 | ||||
Liabilities held for distribution | [1] | 211,387 | |||
Total liabilities | 534,988 | ||||
Total equity and liabilities | 554,683 | ||||
Total continuing operations | |||||
Assets | |||||
Goodwill | 510 | ||||
Deferred acquisition costs and other intangible assets | 12,659 | ||||
Reinsurers' share of insurance contract liabilities | 10,151 | ||||
Other assets | 10,752 | ||||
Investment properties | 11 | ||||
Investment in joint ventures and associates accounted for using the equity method | 1,030 | ||||
Financial investments | 299,529 | ||||
Cash and cash equivalents | 5,208 | ||||
Total assets | 339,850 | ||||
Total equity | 11,415 | ||||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 286,276 | ||||
Unallocated surplus of with-profits funds | 3,034 | ||||
Core structural borrowings of shareholder-financed businesses | 7,441 | ||||
Operational borrowings attributable to shareholder-financed businesses | 1,664 | ||||
Borrowings attributable to with-profits businesses | 238 | ||||
Other liabilities | 29,782 | ||||
Total liabilities | 328,435 | ||||
Total equity and liabilities | 339,850 | ||||
Unallocated to a segment (central or other operations) | |||||
Assets | |||||
Deferred acquisition costs and other intangible assets | 45 | ||||
Reinsurers' share of insurance contract liabilities | 3 | ||||
Other assets | 2,525 | ||||
Financial investments | 2,155 | ||||
Cash and cash equivalents | 1,802 | ||||
Total assets | 6,530 | ||||
Total equity | (2,993) | ||||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 47 | 39 | 37 | 32 | |
Core structural borrowings of shareholder-financed businesses | 7,245 | ||||
Operational borrowings attributable to shareholder-financed businesses | 727 | ||||
Other liabilities | 1,504 | ||||
Total liabilities | 9,523 | ||||
Total equity and liabilities | 6,530 | ||||
Asia | Operating segments | |||||
Assets | |||||
Goodwill | 510 | 498 | |||
Deferred acquisition costs and other intangible assets | 3,624 | 2,937 | |||
Reinsurers' share of insurance contract liabilities | 3,621 | 2,777 | |||
Other assets | 4,319 | 3,916 | |||
Investment properties | 5 | 5 | |||
Investment in joint ventures and associates accounted for using the equity method | 1,030 | 991 | |||
Financial investments | 93,476 | 80,886 | |||
Cash and cash equivalents | 2,222 | 2,189 | |||
Total assets | 108,807 | 94,199 | |||
Total equity | 7,656 | 6,428 | |||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 84,077 | 73,216 | |||
Unallocated surplus of with-profits funds | 3,034 | 2,511 | |||
Operational borrowings attributable to shareholder-financed businesses | 137 | 61 | |||
Borrowings attributable to with-profits businesses | 238 | 19 | |||
Other liabilities | 13,665 | 11,964 | |||
Total liabilities | 101,151 | 87,771 | |||
Total equity and liabilities | 108,807 | 94,199 | |||
US | Operating segments | |||||
Assets | |||||
Deferred acquisition costs and other intangible assets | 8,990 | 8,747 | |||
Reinsurers' share of insurance contract liabilities | 6,527 | 6,662 | |||
Other assets | 3,908 | 3,588 | |||
Investment properties | 6 | 6 | |||
Financial investments | 203,898 | 182,910 | |||
Cash and cash equivalents | 1,184 | 3,005 | |||
Total assets | 224,513 | 204,918 | |||
Total equity | 6,752 | 5,624 | |||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 202,152 | 185,600 | |||
Core structural borrowings of shareholder-financed businesses | 196 | 196 | |||
Operational borrowings attributable to shareholder-financed businesses | 800 | 328 | |||
Other liabilities | 14,613 | 13,170 | |||
Total liabilities | 217,761 | 199,294 | |||
Total equity and liabilities | 224,513 | 204,918 | |||
Continuing and discontinued operations | |||||
Assets | |||||
Goodwill | 1,857 | 1,482 | |||
Deferred acquisition costs and other intangible assets | 11,923 | ||||
Reinsurers' share of insurance contract liabilities | 11,144 | ||||
Other assets | 11,459 | ||||
Investment properties | 17,925 | ||||
Investment in joint ventures and associates accounted for using the equity method | 1,733 | ||||
Financial investments | 429,901 | ||||
Assets held for sale | 10,578 | ||||
Cash and cash equivalents | 12,125 | ||||
Total assets | 508,645 | ||||
Total equity | 17,267 | ||||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 409,301 | ||||
Unallocated surplus of with-profits funds | 15,845 | ||||
Core structural borrowings of shareholder-financed businesses | 7,664 | ||||
Operational borrowings attributable to shareholder-financed businesses | [2] | 998 | |||
Borrowings attributable to with-profits businesses | [2] | 3,940 | |||
Other liabilities | 43,062 | ||||
Liabilities held for sale | 10,568 | ||||
Total liabilities | 491,378 | ||||
Total equity and liabilities | 508,645 | ||||
Continuing and discontinued operations | Elimination of intra-group amounts | |||||
Assets | |||||
Other assets | (3,491) | ||||
Assets held for distribution | (2,802) | ||||
Total assets | (6,293) | ||||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | (1,108) | ||||
Unallocated surplus of with-profits funds | (90) | ||||
Other liabilities | (3,636) | ||||
Liabilities held for distribution | (1,459) | ||||
Total liabilities | (6,293) | ||||
Total equity and liabilities | (6,293) | ||||
UK & Europe Operations (M&G Prudential) | |||||
Assets | |||||
Goodwill | 1,355 | 1,359 | |||
Deferred acquisition costs and other intangible assets | 174 | 195 | |||
Reinsurers' share of insurance contract liabilities | 2,690 | 2,812 | |||
Investment properties | 18,634 | 17,914 | |||
Investment in joint ventures and associates accounted for using the equity method | 605 | 742 | |||
Assets held for sale | 10,170 | 10,578 | |||
Cash and cash equivalents | 4,624 | 4,749 | |||
Total assets | 221,126 | 209,201 | |||
Total equity | 8,280 | 8,700 | |||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 159,604 | 151,555 | 154,655 | 167,589 | |
Unallocated surplus of with-profits funds | 15,116 | 13,334 | £ 13,517 | £ 13,477 | |
Operational borrowings attributable to shareholder-financed businesses | 456 | 106 | |||
Borrowings attributable to with-profits businesses | 3,580 | 3,921 | |||
Liabilities held for sale | 10,164 | 10,568 | |||
Total liabilities | 212,846 | 200,501 | |||
Total equity and liabilities | 221,126 | £ 209,201 | |||
UK & Europe Operations (M&G Prudential) | Operating segments | |||||
Assets | |||||
Assets held for distribution | 221,126 | ||||
Total assets | 221,126 | ||||
Total equity | 8,280 | ||||
Liabilities | |||||
Liabilities held for distribution | 212,846 | ||||
Total liabilities | 212,846 | ||||
Total equity and liabilities | £ 221,126 | ||||
[1] | Assets and liabilities held for distribution relate to the Group’s UK and Europe operations, which have been classified as discontinued operations at 30 June 2019 and are presented above after the elimination of intra-Group balances with the continuing operations (see note C1). A line-by-line analysis of assets and liabilities for the discontinued UK and Europe operations before elimination of such intra-Group balances, is included in note D2.2. The 2018 comparative results for the assets and liabilities at 31 December 2018 are as published and not re-presented on a basis consistent with half year 2019 (as described in note A2). | ||||
[2] | As at 1 January 2019, the Group applied IFRS 16, ‘Leases’, using the modified retrospective approach. Under this approach, comparative information is not restated. The application of the standard has resulted in the recognition of an additional lease liability and a corresponding ‘right-of-use’ asset of a similar amount as at 1 January 2019. See note A3 for further details. As at 30 June 2019, right-of-use assets recognised in property, plant and equipment for continuing operations amounted to £425 million. |
Analysis of Group statement o_4
Analysis of Group statement of financial position by segment - Details (Details) - GBP (£) £ in Millions | 6 Months Ended | |||
Jun. 30, 2019 | Dec. 31, 2018 | |||
Accrued investment income and other debtors | ||||
Reinsurers' share of contract liabilities | £ 10,151 | |||
Property, plant and equipment | 785 | [1] | £ 378 | |
Right-of-use assets | 425 | |||
Additions to property, plant and equipment | 82 | |||
Additions to right-of-use assets | 66 | |||
Premiums receivable | 564 | |||
Accruals, deferred income and other liabilities | £ 10,597 | |||
Effect of IFRS 16 | ||||
Accrued investment income and other debtors | ||||
Property, plant and equipment | 414 | |||
Right-of-use assets | 414 | |||
Accruals, deferred income and other liabilities | (11) | |||
Continuing and discontinued operations | ||||
Accrued investment income and other debtors | ||||
Reinsurers' share of contract liabilities | 11,144 | |||
Property, plant and equipment | [1] | 1,409 | ||
Premiums receivable | 672 | |||
Accruals, deferred income and other liabilities | 15,248 | |||
Continuing and discontinued operations | Effect of IFRS 16 | ||||
Accrued investment income and other debtors | ||||
Property, plant and equipment | 703 | |||
Accruals, deferred income and other liabilities | £ (47) | |||
Due within one year | ||||
Accrued investment income and other debtors | ||||
Premiums receivable due (as a percent) | 91.00% | |||
Accruals, deferred income and other liabilities | £ 6,722 | |||
Due within one year | Continuing and discontinued operations | ||||
Accrued investment income and other debtors | ||||
Premiums receivable due (as a percent) | 73.00% | |||
Accruals, deferred income and other liabilities | £ 9,968 | |||
[1] | As at 1 January 2019, the Group applied IFRS 16, ‘Leases’, using the modified retrospective approach. Under this approach, comparative information is not restated. The application of the standard has resulted in the recognition of an additional lease liability and a corresponding ‘right-of-use’ asset of a similar amount as at 1 January 2019. See note A3 for further details. As at 30 June 2019, right-of-use assets recognised in property, plant and equipment for continuing operations amounted to £425 million. |
Analysis of segment statement_3
Analysis of segment statement of financial position by business type (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2017 | |
Assets | |||||
Goodwill | £ 510 | ||||
Deferred acquisition costs and other intangible assets | 12,659 | ||||
Reinsurers' share of insurance contract liabilities | 10,151 | ||||
Other assets | 7,261 | ||||
Investment properties | 11 | ||||
Investment in joint ventures and associates accounted for using the equity method | 1,030 | ||||
Financial investments | 299,529 | ||||
Cash and cash equivalents | 5,208 | £ 5,030 | |||
Total assets | 554,683 | ||||
Total equity | 19,695 | £ 17,267 | £ 15,890 | £ 16,094 | |
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 285,168 | ||||
Core structural borrowings of shareholder-financed businesses | 7,441 | ||||
Unallocated surplus of with-profits funds | 2,944 | ||||
Operational borrowings attributable to shareholder-financed businesses | [1] | 1,664 | |||
Borrowings attributable to with-profits businesses | [1] | 238 | |||
Other liabilities | 26,146 | ||||
Total liabilities | 534,988 | ||||
Total equity and liabilities | 554,683 | ||||
With-profits | |||||
Assets | |||||
Deferred acquisition costs and other intangible assets | 58 | 56 | |||
Operating segments | Asia | |||||
Assets | |||||
Goodwill | 510 | 498 | |||
Deferred acquisition costs and other intangible assets | 3,624 | 2,937 | |||
Reinsurers' share of insurance contract liabilities | 3,621 | 2,777 | |||
Other assets | 4,319 | 3,916 | |||
Investment properties | 5 | 5 | |||
Investment in joint ventures and associates accounted for using the equity method | 1,030 | 991 | |||
Financial investments | 93,476 | 80,886 | |||
Cash and cash equivalents | 2,222 | 2,189 | |||
Total assets | 108,807 | 94,199 | |||
Total equity | 7,656 | 6,428 | |||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 84,077 | 73,216 | |||
Unallocated surplus of with-profits funds | 3,034 | 2,511 | |||
Operational borrowings attributable to shareholder-financed businesses | 137 | 61 | |||
Borrowings attributable to with-profits businesses | 238 | 19 | |||
Other liabilities | 13,665 | 11,964 | |||
Total liabilities | 101,151 | 87,771 | |||
Total equity and liabilities | 108,807 | 94,199 | |||
Operating segments | US | |||||
Assets | |||||
Deferred acquisition costs and other intangible assets | 8,990 | 8,747 | |||
Reinsurers' share of insurance contract liabilities | 6,527 | 6,662 | |||
Other assets | 3,908 | 3,588 | |||
Investment properties | 6 | 6 | |||
Financial investments | 203,898 | 182,910 | |||
Cash and cash equivalents | 1,184 | 3,005 | |||
Total assets | 224,513 | 204,918 | |||
Total equity | 6,752 | 5,624 | |||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 202,152 | 185,600 | |||
Core structural borrowings of shareholder-financed businesses | 196 | 196 | |||
Operational borrowings attributable to shareholder-financed businesses | 800 | 328 | |||
Other liabilities | 14,613 | 13,170 | |||
Total liabilities | 217,761 | 199,294 | |||
Total equity and liabilities | 224,513 | £ 204,918 | |||
Operations within segments | Asia insurance operations | |||||
Assets | |||||
Goodwill | 252 | ||||
Deferred acquisition costs and other intangible assets | 3,612 | ||||
Reinsurers' share of insurance contract liabilities | 3,621 | ||||
Other assets | 4,198 | ||||
Investment properties | 5 | ||||
Investment in joint ventures and associates accounted for using the equity method | 859 | ||||
Financial investments | 93,313 | ||||
Cash and cash equivalents | 2,113 | ||||
Total assets | 107,973 | ||||
Total equity | 7,077 | ||||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 84,077 | ||||
Unallocated surplus of with-profits funds | 3,034 | ||||
Operational borrowings attributable to shareholder-financed businesses | 124 | ||||
Borrowings attributable to with-profits businesses | 238 | ||||
Other liabilities | 13,423 | ||||
Total liabilities | 100,896 | ||||
Total equity and liabilities | 107,973 | ||||
Operations within segments | Asia insurance operations | With-profits | |||||
Assets | |||||
Deferred acquisition costs and other intangible assets | 58 | ||||
Reinsurers' share of insurance contract liabilities | 83 | ||||
Other assets | 2,526 | ||||
Financial investments | 54,687 | ||||
Cash and cash equivalents | 534 | ||||
Total assets | 57,888 | ||||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 48,041 | ||||
Unallocated surplus of with-profits funds | 3,034 | ||||
Borrowings attributable to with-profits businesses | 238 | ||||
Other liabilities | 6,575 | ||||
Total liabilities | 57,888 | ||||
Total equity and liabilities | 57,888 | ||||
Operations within segments | Asia insurance operations | Unit-linked | |||||
Assets | |||||
Other assets | 315 | ||||
Financial investments | 18,492 | ||||
Cash and cash equivalents | 400 | ||||
Total assets | 19,207 | ||||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 17,594 | ||||
Operational borrowings attributable to shareholder-financed businesses | 36 | ||||
Other liabilities | 1,577 | ||||
Total liabilities | 19,207 | ||||
Total equity and liabilities | 19,207 | ||||
Operations within segments | Asia insurance operations | Other business | |||||
Assets | |||||
Goodwill | 252 | ||||
Deferred acquisition costs and other intangible assets | 3,554 | ||||
Reinsurers' share of insurance contract liabilities | 3,538 | ||||
Other assets | 1,357 | ||||
Investment properties | 5 | ||||
Investment in joint ventures and associates accounted for using the equity method | 859 | ||||
Financial investments | 20,134 | ||||
Cash and cash equivalents | 1,179 | ||||
Total assets | 30,878 | ||||
Total equity | 7,077 | ||||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 18,442 | ||||
Operational borrowings attributable to shareholder-financed businesses | 88 | ||||
Other liabilities | 5,271 | ||||
Total liabilities | 23,801 | ||||
Total equity and liabilities | 30,878 | ||||
Operations within segments | Asia asset management | |||||
Assets | |||||
Goodwill | 258 | ||||
Deferred acquisition costs and other intangible assets | 12 | ||||
Other assets | 156 | ||||
Investment in joint ventures and associates accounted for using the equity method | 171 | ||||
Financial investments | 163 | ||||
Cash and cash equivalents | 109 | ||||
Total assets | 869 | ||||
Total equity | 579 | ||||
Liabilities | |||||
Operational borrowings attributable to shareholder-financed businesses | 13 | ||||
Other liabilities | 277 | ||||
Total liabilities | 290 | ||||
Total equity and liabilities | 869 | ||||
Operations within segments | Jackson (US insurance operations) | |||||
Assets | |||||
Deferred acquisition costs and other intangible assets | 8,990 | ||||
Reinsurers' share of insurance contract liabilities | 6,527 | ||||
Other assets | 3,834 | ||||
Investment properties | 6 | ||||
Financial investments | 203,880 | ||||
Cash and cash equivalents | 1,130 | ||||
Total assets | 224,367 | ||||
Total equity | 6,702 | ||||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 202,152 | ||||
Core structural borrowings of shareholder-financed businesses | 196 | ||||
Operational borrowings attributable to shareholder-financed businesses | 767 | ||||
Other liabilities | 14,550 | ||||
Total liabilities | 217,665 | ||||
Total equity and liabilities | 224,367 | ||||
Operations within segments | Jackson (US insurance operations) | Variable annuity separate account | |||||
Assets | |||||
Financial investments | 145,295 | ||||
Total assets | 145,295 | ||||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 145,295 | ||||
Total liabilities | 145,295 | ||||
Total equity and liabilities | 145,295 | ||||
Operations within segments | Jackson (US insurance operations) | Fixed annuity, GICs and other | |||||
Assets | |||||
Deferred acquisition costs and other intangible assets | 8,990 | ||||
Reinsurers' share of insurance contract liabilities | 6,527 | ||||
Other assets | 3,834 | ||||
Investment properties | 6 | ||||
Financial investments | 58,585 | ||||
Cash and cash equivalents | 1,130 | ||||
Total assets | 79,072 | ||||
Total equity | 6,702 | ||||
Liabilities | |||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 56,857 | ||||
Core structural borrowings of shareholder-financed businesses | 196 | ||||
Operational borrowings attributable to shareholder-financed businesses | 767 | ||||
Other liabilities | 14,550 | ||||
Total liabilities | 72,370 | ||||
Total equity and liabilities | 79,072 | ||||
Operations within segments | Asset management (US) | |||||
Assets | |||||
Other assets | 143 | ||||
Financial investments | 18 | ||||
Cash and cash equivalents | 54 | ||||
Total assets | 215 | ||||
Total equity | 50 | ||||
Liabilities | |||||
Operational borrowings attributable to shareholder-financed businesses | 33 | ||||
Other liabilities | 132 | ||||
Total liabilities | 165 | ||||
Total equity and liabilities | 215 | ||||
Elimination of intra-segment amounts | Asia | |||||
Assets | |||||
Other assets | (35) | ||||
Total assets | (35) | ||||
Liabilities | |||||
Other liabilities | (35) | ||||
Total liabilities | (35) | ||||
Total equity and liabilities | (35) | ||||
Elimination of intra-segment amounts | US | |||||
Assets | |||||
Other assets | (69) | ||||
Total assets | (69) | ||||
Liabilities | |||||
Other liabilities | (69) | ||||
Total liabilities | (69) | ||||
Total equity and liabilities | £ (69) | ||||
[1] | As at 1 January 2019, the Group applied IFRS 16, ‘Leases’, using the modified retrospective approach. Under this approach, comparative information is not restated. The application of the standard has resulted in the recognition of an additional lease liability and a corresponding ‘right-of-use’ asset of a similar amount as at 1 January 2019. See note A3 for further details. As at 30 June 2019, right-of-use assets recognised in property, plant and equipment for continuing operations amounted to £425 million. |
Group assets and liabilities _3
Group assets and liabilities - measurement - Carried at fair value (Details) - GBP (£) £ in Millions | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Financial instruments | |||
Financial assets classified as available-for-sale | £ 44,178 | £ 40,849 | |
At fair value | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | 287,287 | ||
Total financial instruments at fair value | £ 280,053 | £ 247,533 | |
Percentage of total (%) | 100.00% | 100.00% | |
At fair value | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 153,106 | £ 147,626 | |
Total financial instruments at fair value | £ 127,016 | £ 121,092 | |
Percentage of total (%) | 100.00% | 100.00% | |
At fair value | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 401,342 | ||
Total financial instruments at fair value | £ 368,625 | ||
Percentage of total (%) | 100.00% | ||
At fair value | Loans | |||
Financial instruments | |||
Financial assets | £ 2,799 | ||
At fair value | Loans | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 1,940 | £ 1,970 | |
At fair value | Loans | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 4,753 | ||
At fair value | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | 183,670 | ||
At fair value | Equity securities and portfolio holdings in unit trusts | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 59,653 | 53,810 | |
At fair value | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 214,733 | ||
At fair value | Debt securities | |||
Financial instruments | |||
Financial assets | 99,675 | ||
At fair value | Debt securities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 85,174 | 85,956 | |
At fair value | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 175,356 | ||
At fair value | Other investments (including derivative assets) | |||
Financial instruments | |||
Financial assets | 2,180 | ||
At fair value | Other investments (including derivative assets) | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 9,016 | 8,098 | |
At fair value | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 10,006 | ||
At fair value | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (1,037) | ||
At fair value | Derivative liabilities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (2,677) | (2,208) | |
At fair value | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (3,506) | ||
At fair value | Investment contract liabilities without discretionary participation features held at fair value | |||
Financial instruments | |||
Financial liabilities | (666) | ||
At fair value | Investment contract liabilities without discretionary participation features held at fair value | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (15,695) | (15,560) | |
At fair value | Investment contract liabilities without discretionary participation features held at fair value | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (16,054) | ||
At fair value | Borrowings attributable to with-profits businesses | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (1,504) | (1,606) | |
At fair value | Borrowings attributable to with-profits businesses | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (1,606) | ||
At fair value | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | |||
Financial instruments | |||
Financial liabilities | (3,482) | ||
At fair value | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (8,512) | (9,013) | |
At fair value | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (11,651) | ||
At fair value | Other financial liabilities | |||
Financial instruments | |||
Financial liabilities | (3,086) | ||
At fair value | Other financial liabilities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (379) | (355) | |
At fair value | Other financial liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (3,406) | ||
At fair value | With-profits | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 53,583 | ||
Percentage of total (%) | 100.00% | ||
Total financial instruments at fair value | 43,278 | ||
At fair value | With-profits | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 109,168 | £ 102,856 | |
Percentage of total (%) | 100.00% | 100.00% | |
At fair value | With-profits | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 147,375 | ||
Percentage of total (%) | 100.00% | ||
At fair value | With-profits | Loans | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | £ 1,637 | £ 1,703 | |
At fair value | With-profits | Loans | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 1,703 | ||
At fair value | With-profits | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | 21,377 | ||
At fair value | With-profits | Equity securities and portfolio holdings in unit trusts | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 45,743 | 41,090 | |
At fair value | With-profits | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 58,255 | ||
At fair value | With-profits | Debt securities | |||
Financial instruments | |||
Financial assets | 32,063 | ||
At fair value | With-profits | Debt securities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 54,796 | 53,798 | |
At fair value | With-profits | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 81,002 | ||
At fair value | With-profits | Other investments (including derivative assets) | |||
Financial instruments | |||
Financial assets | 188 | ||
At fair value | With-profits | Other investments (including derivative assets) | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 8,459 | 7,530 | |
At fair value | With-profits | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 7,731 | ||
At fair value | With-profits | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (45) | ||
At fair value | With-profits | Derivative liabilities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (1,467) | (1,265) | |
At fair value | With-profits | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (1,316) | ||
At fair value | Unit-linked and variable annuity separate account | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 163,278 | ||
Percentage of total (%) | 100.00% | ||
Total financial instruments at fair value | 143,492 | ||
At fair value | Unit-linked and variable annuity separate account | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 168,004 | ||
Percentage of total (%) | 100.00% | ||
At fair value | Unit-linked and variable annuity separate account | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | £ 159,692 | ||
At fair value | Unit-linked and variable annuity separate account | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | £ 153,501 | ||
At fair value | Unit-linked and variable annuity separate account | Debt securities | |||
Financial instruments | |||
Financial assets | 3,603 | ||
At fair value | Unit-linked and variable annuity separate account | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 14,493 | ||
At fair value | Unit-linked and variable annuity separate account | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 15 | ||
At fair value | Unit-linked and variable annuity separate account | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (17) | ||
At fair value | Unit-linked and variable annuity separate account | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (5) | ||
At fair value | Non-linked shareholder-backed | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 70,426 | ||
Percentage of total (%) | 100.00% | ||
Total financial instruments at fair value | 60,763 | ||
At fair value | Non-linked shareholder-backed | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 85,963 | ||
Percentage of total (%) | 100.00% | ||
At fair value | Non-linked shareholder-backed | Loans | |||
Financial instruments | |||
Financial assets | £ 2,799 | ||
At fair value | Non-linked shareholder-backed | Loans | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | £ 3,050 | ||
At fair value | Non-linked shareholder-backed | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | 2,601 | ||
At fair value | Non-linked shareholder-backed | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 2,977 | ||
At fair value | Non-linked shareholder-backed | Debt securities | |||
Financial instruments | |||
Financial assets | 64,009 | ||
At fair value | Non-linked shareholder-backed | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 79,861 | ||
At fair value | Non-linked shareholder-backed | Other investments (including derivative assets) | |||
Financial instruments | |||
Financial assets | 1,992 | ||
At fair value | Non-linked shareholder-backed | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 2,260 | ||
At fair value | Non-linked shareholder-backed | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (975) | ||
At fair value | Non-linked shareholder-backed | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (2,185) | ||
At fair value | Level 1 | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | 229,987 | ||
Total financial instruments at fair value | £ 226,505 | £ 199,296 | |
Percentage of total (%) | 81.00% | 81.00% | |
At fair value | Level 1 | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 67,470 | £ 63,343 | |
Total financial instruments at fair value | £ 60,686 | £ 55,900 | |
Percentage of total (%) | 47.00% | 46.00% | |
At fair value | Level 1 | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 262,048 | ||
Total financial instruments at fair value | £ 255,196 | ||
Percentage of total (%) | 70.00% | ||
At fair value | Level 1 | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | £ 181,360 | ||
At fair value | Level 1 | Equity securities and portfolio holdings in unit trusts | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 54,553 | £ 49,419 | |
At fair value | Level 1 | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 208,264 | ||
At fair value | Level 1 | Debt securities | |||
Financial instruments | |||
Financial assets | 48,530 | ||
At fair value | Level 1 | Debt securities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 12,912 | 13,928 | |
At fair value | Level 1 | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 53,663 | ||
At fair value | Level 1 | Other investments (including derivative assets) | |||
Financial instruments | |||
Financial assets | 149 | ||
At fair value | Level 1 | Other investments (including derivative assets) | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 70 | 61 | |
At fair value | Level 1 | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 210 | ||
At fair value | Level 1 | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (52) | ||
At fair value | Level 1 | Derivative liabilities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (65) | (65) | |
At fair value | Level 1 | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (89) | ||
At fair value | Level 1 | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | |||
Financial instruments | |||
Financial liabilities | (3,482) | ||
At fair value | Level 1 | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (6,784) | (7,443) | |
At fair value | Level 1 | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (6,852) | ||
At fair value | Level 1 | With-profits | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 48,355 | ||
Percentage of total (%) | 90.00% | ||
Total financial instruments at fair value | 39,191 | ||
At fair value | Level 1 | With-profits | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 49,133 | £ 45,393 | |
Percentage of total (%) | 45.00% | 44.00% | |
At fair value | Level 1 | With-profits | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 83,588 | ||
Percentage of total (%) | 57.00% | ||
At fair value | Level 1 | With-profits | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | £ 19,318 | ||
At fair value | Level 1 | With-profits | Equity securities and portfolio holdings in unit trusts | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 41,593 | £ 37,027 | |
At fair value | Level 1 | With-profits | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 52,320 | ||
At fair value | Level 1 | With-profits | Debt securities | |||
Financial instruments | |||
Financial assets | 28,964 | ||
At fair value | Level 1 | With-profits | Debt securities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 7,534 | 8,374 | |
At fair value | Level 1 | With-profits | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 31,210 | ||
At fair value | Level 1 | With-profits | Other investments (including derivative assets) | |||
Financial instruments | |||
Financial assets | 107 | ||
At fair value | Level 1 | With-profits | Other investments (including derivative assets) | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 66 | 56 | |
At fair value | Level 1 | With-profits | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 143 | ||
At fair value | Level 1 | With-profits | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (34) | ||
At fair value | Level 1 | With-profits | Derivative liabilities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (60) | (64) | |
At fair value | Level 1 | With-profits | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (85) | ||
At fair value | Level 1 | Unit-linked and variable annuity separate account | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 162,291 | ||
Percentage of total (%) | 99.00% | ||
Total financial instruments at fair value | 143,556 | ||
At fair value | Level 1 | Unit-linked and variable annuity separate account | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 157,757 | ||
Percentage of total (%) | 94.00% | ||
At fair value | Level 1 | Unit-linked and variable annuity separate account | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | £ 159,462 | ||
At fair value | Level 1 | Unit-linked and variable annuity separate account | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | £ 152,987 | ||
At fair value | Level 1 | Unit-linked and variable annuity separate account | Debt securities | |||
Financial instruments | |||
Financial assets | 2,840 | ||
At fair value | Level 1 | Unit-linked and variable annuity separate account | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 4,766 | ||
At fair value | Level 1 | Unit-linked and variable annuity separate account | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 6 | ||
At fair value | Level 1 | Unit-linked and variable annuity separate account | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (11) | ||
At fair value | Level 1 | Unit-linked and variable annuity separate account | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (2) | ||
At fair value | Level 1 | Non-linked shareholder-backed | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 19,341 | ||
Percentage of total (%) | 27.00% | ||
Total financial instruments at fair value | 16,549 | ||
At fair value | Level 1 | Non-linked shareholder-backed | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 20,703 | ||
Percentage of total (%) | 24.00% | ||
At fair value | Level 1 | Non-linked shareholder-backed | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | £ 2,580 | ||
At fair value | Level 1 | Non-linked shareholder-backed | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | £ 2,957 | ||
At fair value | Level 1 | Non-linked shareholder-backed | Debt securities | |||
Financial instruments | |||
Financial assets | 16,726 | ||
At fair value | Level 1 | Non-linked shareholder-backed | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 17,687 | ||
At fair value | Level 1 | Non-linked shareholder-backed | Other investments (including derivative assets) | |||
Financial instruments | |||
Financial assets | 42 | ||
At fair value | Level 1 | Non-linked shareholder-backed | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 61 | ||
At fair value | Level 1 | Non-linked shareholder-backed | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (7) | ||
At fair value | Level 1 | Non-linked shareholder-backed | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (2) | ||
At fair value | Level 2 | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | 53,818 | ||
Total financial instruments at fair value | £ 53,147 | £ 47,812 | |
Percentage of total (%) | 19.00% | 19.00% | |
At fair value | Level 2 | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 76,974 | £ 76,458 | |
Total financial instruments at fair value | £ 60,535 | £ 60,316 | |
Percentage of total (%) | 48.00% | 50.00% | |
At fair value | Level 2 | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 127,995 | ||
Total financial instruments at fair value | £ 108,128 | ||
Percentage of total (%) | 29.00% | ||
At fair value | Level 2 | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | £ 2,140 | ||
At fair value | Level 2 | Equity securities and portfolio holdings in unit trusts | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 4,697 | £ 4,046 | |
At fair value | Level 2 | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 5,954 | ||
At fair value | Level 2 | Debt securities | |||
Financial instruments | |||
Financial assets | 51,139 | ||
At fair value | Level 2 | Debt securities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 71,073 | 70,851 | |
At fair value | Level 2 | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 120,511 | ||
At fair value | Level 2 | Other investments (including derivative assets) | |||
Financial instruments | |||
Financial assets | 1,069 | ||
At fair value | Level 2 | Other investments (including derivative assets) | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 3,809 | 3,704 | |
At fair value | Level 2 | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 4,524 | ||
At fair value | Level 2 | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (530) | ||
At fair value | Level 2 | Derivative liabilities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (2,605) | (2,143) | |
At fair value | Level 2 | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (2,994) | ||
At fair value | Level 2 | Investment contract liabilities without discretionary participation features held at fair value | |||
Financial instruments | |||
Financial liabilities | (666) | ||
At fair value | Level 2 | Investment contract liabilities without discretionary participation features held at fair value | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (15,695) | (15,560) | |
At fair value | Level 2 | Investment contract liabilities without discretionary participation features held at fair value | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (16,054) | ||
At fair value | Level 2 | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (744) | (582) | |
At fair value | Level 2 | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (3,811) | ||
At fair value | Level 2 | Other financial liabilities | |||
Financial instruments | |||
Financial liabilities | (5) | ||
At fair value | Level 2 | Other financial liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (2) | ||
At fair value | Level 2 | With-profits | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 5,069 | ||
Percentage of total (%) | 10.00% | ||
Total financial instruments at fair value | 3,928 | ||
At fair value | Level 2 | With-profits | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 52,050 | £ 50,295 | |
Percentage of total (%) | 48.00% | 49.00% | |
At fair value | Level 2 | With-profits | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 56,460 | ||
Percentage of total (%) | 38.00% | ||
At fair value | Level 2 | With-profits | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | £ 1,906 | ||
At fair value | Level 2 | With-profits | Equity securities and portfolio holdings in unit trusts | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 3,758 | £ 3,728 | |
At fair value | Level 2 | With-profits | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 5,447 | ||
At fair value | Level 2 | With-profits | Debt securities | |||
Financial instruments | |||
Financial assets | 3,093 | ||
At fair value | Level 2 | With-profits | Debt securities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 46,410 | 44,619 | |
At fair value | Level 2 | With-profits | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 48,981 | ||
At fair value | Level 2 | With-profits | Other investments (including derivative assets) | |||
Financial instruments | |||
Financial assets | 81 | ||
At fair value | Level 2 | With-profits | Other investments (including derivative assets) | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 3,282 | 3,149 | |
At fair value | Level 2 | With-profits | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 3,263 | ||
At fair value | Level 2 | With-profits | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (11) | ||
At fair value | Level 2 | With-profits | Derivative liabilities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (1,400) | (1,201) | |
At fair value | Level 2 | With-profits | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (1,231) | ||
At fair value | Level 2 | Unit-linked and variable annuity separate account | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 987 | ||
Percentage of total (%) | 1.00% | ||
Total financial instruments at fair value | (64) | ||
At fair value | Level 2 | Unit-linked and variable annuity separate account | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 10,232 | ||
Percentage of total (%) | 6.00% | ||
At fair value | Level 2 | Unit-linked and variable annuity separate account | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | £ 230 | ||
At fair value | Level 2 | Unit-linked and variable annuity separate account | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | £ 505 | ||
At fair value | Level 2 | Unit-linked and variable annuity separate account | Debt securities | |||
Financial instruments | |||
Financial assets | 763 | ||
At fair value | Level 2 | Unit-linked and variable annuity separate account | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 9,727 | ||
At fair value | Level 2 | Unit-linked and variable annuity separate account | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 3 | ||
At fair value | Level 2 | Unit-linked and variable annuity separate account | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (6) | ||
At fair value | Level 2 | Unit-linked and variable annuity separate account | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (3) | ||
At fair value | Level 2 | Non-linked shareholder-backed | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 47,762 | ||
Percentage of total (%) | 68.00% | ||
Total financial instruments at fair value | 43,948 | ||
At fair value | Level 2 | Non-linked shareholder-backed | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 61,303 | ||
Percentage of total (%) | 71.00% | ||
At fair value | Level 2 | Non-linked shareholder-backed | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | £ 4 | ||
At fair value | Level 2 | Non-linked shareholder-backed | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | £ 2 | ||
At fair value | Level 2 | Non-linked shareholder-backed | Debt securities | |||
Financial instruments | |||
Financial assets | 47,283 | ||
At fair value | Level 2 | Non-linked shareholder-backed | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 61,803 | ||
At fair value | Level 2 | Non-linked shareholder-backed | Other investments (including derivative assets) | |||
Financial instruments | |||
Financial assets | 988 | ||
At fair value | Level 2 | Non-linked shareholder-backed | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 1,258 | ||
At fair value | Level 2 | Non-linked shareholder-backed | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (513) | ||
At fair value | Level 2 | Non-linked shareholder-backed | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (1,760) | ||
At fair value | Level 3 | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | 3,482 | ||
Total financial instruments at fair value | £ 401 | £ 425 | |
Percentage of total (%) | 0.00% | 0.00% | |
At fair value | Level 3 | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 8,662 | £ 7,825 | |
Total financial instruments at fair value | £ 5,795 | £ 4,876 | |
Percentage of total (%) | 5.00% | 4.00% | |
At fair value | Level 3 | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 11,299 | ||
Total financial instruments at fair value | £ 5,301 | £ 4,443 | |
Percentage of total (%) | 1.00% | ||
At fair value | Level 3 | Loans | |||
Financial instruments | |||
Financial assets | £ 2,799 | ||
At fair value | Level 3 | Loans | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 1,940 | £ 1,970 | |
At fair value | Level 3 | Loans | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 4,753 | 4,837 | |
At fair value | Level 3 | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | 170 | ||
At fair value | Level 3 | Equity securities and portfolio holdings in unit trusts | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 403 | 345 | |
At fair value | Level 3 | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 515 | 371 | |
At fair value | Level 3 | Debt securities | |||
Financial instruments | |||
Financial assets | 6 | ||
At fair value | Level 3 | Debt securities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 1,189 | 1,177 | |
At fair value | Level 3 | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 1,182 | 654 | |
At fair value | Level 3 | Other investments (including derivative assets) | |||
Financial instruments | |||
Financial assets | 962 | ||
At fair value | Level 3 | Other investments (including derivative assets) | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 5,137 | 4,333 | |
At fair value | Level 3 | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 5,272 | 4,424 | |
At fair value | Level 3 | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | (455) | ||
Total financial instruments at fair value | (451) | ||
At fair value | Level 3 | Derivative liabilities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (7) | ||
At fair value | Level 3 | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (423) | (512) | |
At fair value | Level 3 | Borrowings attributable to with-profits businesses | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (1,504) | (1,606) | |
At fair value | Level 3 | Borrowings attributable to with-profits businesses | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (1,606) | (1,887) | |
At fair value | Level 3 | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (984) | (988) | |
At fair value | Level 3 | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (988) | (413) | |
At fair value | Level 3 | Other financial liabilities | |||
Financial instruments | |||
Financial liabilities | (3,081) | ||
At fair value | Level 3 | Other financial liabilities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | (379) | (355) | |
At fair value | Level 3 | Other financial liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | (3,404) | £ (3,031) | |
At fair value | Level 3 | With-profits | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 159 | ||
Percentage of total (%) | 0.00% | ||
Total financial instruments at fair value | 159 | ||
At fair value | Level 3 | With-profits | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 7,985 | £ 7,168 | |
Percentage of total (%) | 7.00% | 7.00% | |
At fair value | Level 3 | With-profits | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 7,327 | ||
Percentage of total (%) | 5.00% | ||
At fair value | Level 3 | With-profits | Loans | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | £ 1,637 | £ 1,703 | |
At fair value | Level 3 | With-profits | Loans | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 1,703 | ||
At fair value | Level 3 | With-profits | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | 153 | ||
At fair value | Level 3 | With-profits | Equity securities and portfolio holdings in unit trusts | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 392 | 335 | |
At fair value | Level 3 | With-profits | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 488 | ||
At fair value | Level 3 | With-profits | Debt securities | |||
Financial instruments | |||
Financial assets | 6 | ||
At fair value | Level 3 | With-profits | Debt securities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 852 | 805 | |
At fair value | Level 3 | With-profits | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 811 | ||
At fair value | Level 3 | With-profits | Other investments (including derivative assets) | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial assets | 5,111 | 4,325 | |
At fair value | Level 3 | With-profits | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 4,325 | ||
At fair value | Level 3 | With-profits | Derivative liabilities | UK & Europe Operations (M&G Prudential) | |||
Financial instruments | |||
Financial liabilities | £ (7) | ||
At fair value | Level 3 | Unit-linked and variable annuity separate account | |||
Financial instruments | |||
Percentage of total (%) | 0.00% | ||
At fair value | Level 3 | Unit-linked and variable annuity separate account | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 15 | ||
Percentage of total (%) | 0.00% | ||
At fair value | Level 3 | Unit-linked and variable annuity separate account | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | £ 9 | ||
At fair value | Level 3 | Unit-linked and variable annuity separate account | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 6 | ||
At fair value | Level 3 | Non-linked shareholder-backed | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 3,323 | ||
Percentage of total (%) | 5.00% | ||
Total financial instruments at fair value | £ 396 | 266 | |
At fair value | Level 3 | Non-linked shareholder-backed | Continuing and discontinued operations | |||
Financial instruments | |||
Total financial investments, net of derivative liabilities | £ 3,957 | ||
Percentage of total (%) | 5.00% | ||
At fair value | Level 3 | Non-linked shareholder-backed | Loans | |||
Financial instruments | |||
Financial assets | 2,799 | ||
At fair value | Level 3 | Non-linked shareholder-backed | Loans | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | £ 3,050 | ||
At fair value | Level 3 | Non-linked shareholder-backed | Equity securities and portfolio holdings in unit trusts | |||
Financial instruments | |||
Financial assets | 17 | ||
At fair value | Level 3 | Non-linked shareholder-backed | Equity securities and portfolio holdings in unit trusts | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 18 | ||
At fair value | Level 3 | Non-linked shareholder-backed | Debt securities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 371 | ||
At fair value | Level 3 | Non-linked shareholder-backed | Other investments (including derivative assets) | |||
Financial instruments | |||
Financial assets | 962 | ||
At fair value | Level 3 | Non-linked shareholder-backed | Other investments (including derivative assets) | Continuing and discontinued operations | |||
Financial instruments | |||
Financial assets | 941 | ||
At fair value | Level 3 | Non-linked shareholder-backed | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | £ (455) | ||
At fair value | Level 3 | Non-linked shareholder-backed | Derivative liabilities | Continuing and discontinued operations | |||
Financial instruments | |||
Financial liabilities | £ (423) |
Group assets and liabilities _4
Group assets and liabilities - measurement - Fair value disclosed (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Financial instruments | ||
Total financial instruments carried at amortised cost | £ (9,075) | £ (7,848) |
Loans | ||
Financial instruments | ||
Financial assets at amortised cost | 9,714 | |
Investment contract liabilities without discretionary participation features held at fair value | ||
Financial instruments | ||
Financial liabilities at amortised cost | (3,132) | |
Core structural borrowings of shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (7,441) | |
Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (1,435) | |
Borrowings (excluding lease liabilities) attributable to the with-profits funds | ||
Financial instruments | ||
Financial liabilities at amortised cost | (25) | |
Obligations under funding, securities lending and sale and repurchase agreements | ||
Financial instruments | ||
Financial liabilities at amortised cost | (6,756) | |
Continuing and discontinued operations | ||
Financial instruments | ||
Total financial instruments carried at amortised cost | (7,896) | |
Continuing and discontinued operations | Loans | ||
Financial instruments | ||
Financial assets at amortised cost | 13,257 | |
Continuing and discontinued operations | Investment contract liabilities without discretionary participation features held at fair value | ||
Financial instruments | ||
Financial liabilities at amortised cost | (3,168) | |
Continuing and discontinued operations | Core structural borrowings of shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (7,664) | |
Continuing and discontinued operations | Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (998) | |
Continuing and discontinued operations | Borrowings (excluding lease liabilities) attributable to the with-profits funds | ||
Financial instruments | ||
Financial liabilities at amortised cost | (2,334) | |
Continuing and discontinued operations | Obligations under funding, securities lending and sale and repurchase agreements | ||
Financial instruments | ||
Financial liabilities at amortised cost | (6,989) | |
UK & Europe Operations (M&G Prudential) | ||
Financial instruments | ||
Total financial instruments carried at amortised cost | 389 | (48) |
UK & Europe Operations (M&G Prudential) | Loans | ||
Financial instruments | ||
Financial assets at amortised cost | 3,595 | 3,597 |
UK & Europe Operations (M&G Prudential) | Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (114) | (106) |
UK & Europe Operations (M&G Prudential) | Borrowings (excluding lease liabilities) attributable to the with-profits funds | ||
Financial instruments | ||
Financial liabilities at amortised cost | (2,038) | (2,315) |
UK & Europe Operations (M&G Prudential) | Obligations under funding, securities lending and sale and repurchase agreements | ||
Financial instruments | ||
Financial liabilities at amortised cost | (1,054) | (1,224) |
Fair value of instruments not measured at fair value | ||
Financial instruments | ||
Total financial instruments carried at amortised cost | (9,531) | (8,040) |
Fair value of instruments not measured at fair value | Loans | ||
Financial instruments | ||
Financial assets at amortised cost | 10,010 | |
Fair value of instruments not measured at fair value | Investment contract liabilities without discretionary participation features held at fair value | ||
Financial instruments | ||
Financial liabilities at amortised cost | (3,140) | |
Fair value of instruments not measured at fair value | Core structural borrowings of shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (8,052) | |
Fair value of instruments not measured at fair value | Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (1,435) | |
Fair value of instruments not measured at fair value | Borrowings (excluding lease liabilities) attributable to the with-profits funds | ||
Financial instruments | ||
Financial liabilities at amortised cost | (24) | |
Fair value of instruments not measured at fair value | Obligations under funding, securities lending and sale and repurchase agreements | ||
Financial instruments | ||
Financial liabilities at amortised cost | (6,890) | |
Fair value of instruments not measured at fair value | Continuing and discontinued operations | ||
Financial instruments | ||
Total financial instruments carried at amortised cost | (7,447) | |
Fair value of instruments not measured at fair value | Continuing and discontinued operations | Loans | ||
Financial instruments | ||
Financial assets at amortised cost | 13,666 | |
Fair value of instruments not measured at fair value | Continuing and discontinued operations | Investment contract liabilities without discretionary participation features held at fair value | ||
Financial instruments | ||
Financial liabilities at amortised cost | (3,157) | |
Fair value of instruments not measured at fair value | Continuing and discontinued operations | Core structural borrowings of shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (7,847) | |
Fair value of instruments not measured at fair value | Continuing and discontinued operations | Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (998) | |
Fair value of instruments not measured at fair value | Continuing and discontinued operations | Borrowings (excluding lease liabilities) attributable to the with-profits funds | ||
Financial instruments | ||
Financial liabilities at amortised cost | (2,103) | |
Fair value of instruments not measured at fair value | Continuing and discontinued operations | Obligations under funding, securities lending and sale and repurchase agreements | ||
Financial instruments | ||
Financial liabilities at amortised cost | (7,008) | |
Fair value of instruments not measured at fair value | UK & Europe Operations (M&G Prudential) | ||
Financial instruments | ||
Total financial instruments carried at amortised cost | 943 | 593 |
Fair value of instruments not measured at fair value | UK & Europe Operations (M&G Prudential) | Loans | ||
Financial instruments | ||
Financial assets at amortised cost | 4,149 | 4,008 |
Fair value of instruments not measured at fair value | UK & Europe Operations (M&G Prudential) | Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (114) | (106) |
Fair value of instruments not measured at fair value | UK & Europe Operations (M&G Prudential) | Borrowings (excluding lease liabilities) attributable to the with-profits funds | ||
Financial instruments | ||
Financial liabilities at amortised cost | (2,038) | (2,085) |
Fair value of instruments not measured at fair value | UK & Europe Operations (M&G Prudential) | Obligations under funding, securities lending and sale and repurchase agreements | ||
Financial instruments | ||
Financial liabilities at amortised cost | £ (1,054) | £ (1,224) |
Group assets and liabilities _5
Group assets and liabilities - measurement - Level 3 financial instruments (Details) - GBP (£) £ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Total gains (losses) in income statement: | ||
Transfers into level 3 | £ 0 | |
Transfers out of Level 3 | 0 | |
At fair value | ||
Reconciliation of movements in level 3 net financial instruments measured at fair value | ||
Financial instruments at beginning of period | 247,533 | |
Total gains (losses) in income statement: | ||
Financial instruments at end of period | 280,053 | £ 247,533 |
At fair value | Loans | ||
Total gains (losses) in income statement: | ||
Assets at end of period | 2,799 | |
At fair value | Equity securities and portfolio holdings in unit trusts | ||
Total gains (losses) in income statement: | ||
Assets at end of period | 183,670 | |
At fair value | Debt securities | ||
Total gains (losses) in income statement: | ||
Assets at end of period | 99,675 | |
At fair value | Other investments (including derivative assets) | ||
Total gains (losses) in income statement: | ||
Assets at end of period | 2,180 | |
At fair value | Derivative liabilities | ||
Total gains (losses) in income statement: | ||
Liabilities at end of period | (1,037) | |
At fair value | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | ||
Total gains (losses) in income statement: | ||
Liabilities at end of period | (3,482) | |
At fair value | Other financial liabilities | ||
Total gains (losses) in income statement: | ||
Liabilities at end of period | (3,086) | |
At fair value | Continuing and discontinued operations | ||
Reconciliation of movements in level 3 net financial instruments measured at fair value | ||
Financial instruments at beginning of period | 368,625 | |
Total gains (losses) in income statement: | ||
Financial instruments at end of period | 368,625 | |
At fair value | Continuing and discontinued operations | Loans | ||
Reconciliation of movements in level 3 assets measured at fair value | ||
Assets at beginning of period | 4,753 | |
Total gains (losses) in income statement: | ||
Assets at end of period | 4,753 | |
At fair value | Continuing and discontinued operations | Equity securities and portfolio holdings in unit trusts | ||
Reconciliation of movements in level 3 assets measured at fair value | ||
Assets at beginning of period | 214,733 | |
Total gains (losses) in income statement: | ||
Assets at end of period | 214,733 | |
At fair value | Continuing and discontinued operations | Debt securities | ||
Reconciliation of movements in level 3 assets measured at fair value | ||
Assets at beginning of period | 175,356 | |
Total gains (losses) in income statement: | ||
Assets at end of period | 175,356 | |
At fair value | Continuing and discontinued operations | Other investments (including derivative assets) | ||
Reconciliation of movements in level 3 assets measured at fair value | ||
Assets at beginning of period | 10,006 | |
Total gains (losses) in income statement: | ||
Assets at end of period | 10,006 | |
At fair value | Continuing and discontinued operations | Derivative liabilities | ||
Reconciliation of movements in level 3 liabilities measured at fair value | ||
Liabilities at beginning of period | (3,506) | |
Total gains (losses) in income statement: | ||
Liabilities at end of period | (3,506) | |
At fair value | Continuing and discontinued operations | Borrowings attributable to with-profits businesses | ||
Reconciliation of movements in level 3 liabilities measured at fair value | ||
Liabilities at beginning of period | (1,606) | |
Total gains (losses) in income statement: | ||
Liabilities at end of period | (1,606) | |
At fair value | Continuing and discontinued operations | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | ||
Reconciliation of movements in level 3 liabilities measured at fair value | ||
Liabilities at beginning of period | (11,651) | |
Total gains (losses) in income statement: | ||
Liabilities at end of period | (11,651) | |
At fair value | Continuing and discontinued operations | Other financial liabilities | ||
Reconciliation of movements in level 3 liabilities measured at fair value | ||
Liabilities at beginning of period | (3,406) | |
Total gains (losses) in income statement: | ||
Liabilities at end of period | (3,406) | |
At fair value | Level 3 | ||
Reconciliation of movements in level 3 net financial instruments measured at fair value | ||
Financial instruments at beginning of period | 425 | |
Reclassification as held for distribution | (4,876) | |
Total gains (losses) in income statement: | ||
Financial instruments at end of period | 401 | 425 |
At fair value | Level 3 | Loans | ||
Reconciliation of movements in level 3 assets measured at fair value | ||
Reclassification as held for distribution | (1,970) | |
Total gains (losses) in income statement: | ||
Assets at end of period | 2,799 | |
At fair value | Level 3 | Equity securities and portfolio holdings in unit trusts | ||
Reconciliation of movements in level 3 assets measured at fair value | ||
Reclassification as held for distribution | (345) | |
Total gains (losses) in income statement: | ||
Assets at end of period | 170 | |
At fair value | Level 3 | Debt securities | ||
Reconciliation of movements in level 3 assets measured at fair value | ||
Reclassification as held for distribution | (1,177) | |
Total gains (losses) in income statement: | ||
Assets at end of period | 6 | |
At fair value | Level 3 | Other investments (including derivative assets) | ||
Reconciliation of movements in level 3 assets measured at fair value | ||
Reclassification as held for distribution | (4,333) | |
Total gains (losses) in income statement: | ||
Assets at end of period | 962 | |
At fair value | Level 3 | Derivative liabilities | ||
Total gains (losses) in income statement: | ||
Liabilities at end of period | (455) | |
Total gains (losses) in income statement: | ||
Financial instruments at end of period | (451) | |
At fair value | Level 3 | Borrowings attributable to with-profits businesses | ||
Reconciliation of movements in level 3 liabilities measured at fair value | ||
Reclassification as held for distribution | 1,606 | |
At fair value | Level 3 | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | ||
Reconciliation of movements in level 3 liabilities measured at fair value | ||
Reclassification as held for distribution | 988 | |
At fair value | Level 3 | Other financial liabilities | ||
Reconciliation of movements in level 3 liabilities measured at fair value | ||
Reclassification as held for distribution | 355 | |
Total gains (losses) in income statement: | ||
Liabilities at end of period | (3,081) | |
At fair value | Level 3 | Continuing and discontinued operations | ||
Reconciliation of movements in level 3 net financial instruments measured at fair value | ||
Financial instruments at beginning of period | 5,301 | 4,443 |
Total gains (losses) in income statement: | ||
Net realised gains (losses) | (23) | 36 |
Net unrealised gains (losses) on financial instruments held at the end of the year | 9 | 398 |
Total (losses)/gains recorded as other comprehensive income | (28) | 84 |
Purchases | 129 | 2,055 |
Sales | (119) | (1,157) |
Issues | (9) | (899) |
Settlements | 17 | 303 |
Transfers into level 3 | 8 | |
Transfers out of level 3 | 30 | |
Financial instruments at end of period | 5,301 | |
At fair value | Level 3 | Continuing and discontinued operations | Loans | ||
Reconciliation of movements in level 3 assets measured at fair value | ||
Assets at beginning of period | 4,753 | 4,837 |
Total gains (losses) in income statement: | ||
Net realised gains (losses) | 91 | (7) |
Net unrealised gains (losses) on financial instruments held at the end of the year | (71) | |
Total (losses)/gains recorded as other comprehensive income | 4 | 162 |
Purchases | 62 | |
Sales | (178) | |
Issues | 26 | 279 |
Settlements | (105) | (331) |
Assets at end of period | 4,753 | |
At fair value | Level 3 | Continuing and discontinued operations | Equity securities and portfolio holdings in unit trusts | ||
Reconciliation of movements in level 3 assets measured at fair value | ||
Assets at beginning of period | 515 | 371 |
Total gains (losses) in income statement: | ||
Net unrealised gains (losses) on financial instruments held at the end of the year | (2) | 38 |
Total (losses)/gains recorded as other comprehensive income | 8 | |
Purchases | 2 | 125 |
Sales | (35) | |
Transfers into level 3 | 8 | |
Assets at end of period | 515 | |
At fair value | Level 3 | Continuing and discontinued operations | Debt securities | ||
Reconciliation of movements in level 3 assets measured at fair value | ||
Assets at beginning of period | 1,182 | 654 |
Total gains (losses) in income statement: | ||
Net realised gains (losses) | 5 | 9 |
Net unrealised gains (losses) on financial instruments held at the end of the year | (16) | |
Total (losses)/gains recorded as other comprehensive income | 1 | |
Purchases | 666 | |
Sales | (5) | (131) |
Assets at end of period | 1,182 | |
At fair value | Level 3 | Continuing and discontinued operations | Other investments (including derivative assets) | ||
Reconciliation of movements in level 3 assets measured at fair value | ||
Assets at beginning of period | 5,272 | 4,424 |
Total gains (losses) in income statement: | ||
Net realised gains (losses) | (25) | 35 |
Net unrealised gains (losses) on financial instruments held at the end of the year | 40 | 370 |
Total (losses)/gains recorded as other comprehensive income | (5) | 54 |
Purchases | 127 | 1,202 |
Sales | (114) | (813) |
Assets at end of period | 5,272 | |
At fair value | Level 3 | Continuing and discontinued operations | Derivative liabilities | ||
Reconciliation of movements in level 3 liabilities measured at fair value | ||
Liabilities at beginning of period | (423) | (512) |
Total gains (losses) in income statement: | ||
Net unrealised gains (losses) on financial instruments held at the end of the year | (15) | 27 |
Total (losses)/gains recorded as other comprehensive income | (17) | (1) |
Transfers out of level 3 | 63 | |
Liabilities at end of period | (423) | |
At fair value | Level 3 | Continuing and discontinued operations | Borrowings attributable to with-profits businesses | ||
Reconciliation of movements in level 3 liabilities measured at fair value | ||
Liabilities at beginning of period | (1,606) | (1,887) |
Total gains (losses) in income statement: | ||
Net unrealised gains (losses) on financial instruments held at the end of the year | (23) | |
Settlements | 304 | |
Liabilities at end of period | (1,606) | |
At fair value | Level 3 | Continuing and discontinued operations | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | ||
Reconciliation of movements in level 3 liabilities measured at fair value | ||
Liabilities at beginning of period | (988) | (413) |
Total gains (losses) in income statement: | ||
Net unrealised gains (losses) on financial instruments held at the end of the year | 67 | |
Total (losses)/gains recorded as other comprehensive income | 31 | |
Issues | (697) | |
Settlements | 57 | |
Transfers out of level 3 | (33) | |
Liabilities at end of period | (988) | |
At fair value | Level 3 | Continuing and discontinued operations | Other financial liabilities | ||
Reconciliation of movements in level 3 liabilities measured at fair value | ||
Liabilities at beginning of period | (3,404) | (3,031) |
Total gains (losses) in income statement: | ||
Net realised gains (losses) | (94) | (1) |
Net unrealised gains (losses) on financial instruments held at the end of the year | (14) | 6 |
Total (losses)/gains recorded as other comprehensive income | (11) | (170) |
Issues | (35) | (481) |
Settlements | £ 122 | 273 |
Liabilities at end of period | £ (3,404) |
Group assets and liabilities _6
Group assets and liabilities - measurement - Valuation approach for level 3 (Details) - At fair value - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Financial instruments | |||
Net financial instruments at fair value | £ 280,053 | £ 247,533 | |
Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | 1,037 | ||
Level 3 | |||
Financial instruments | |||
Net financial instruments at fair value | £ 401 | 425 | |
Percentage using valuation method | 0.50% | ||
Level 3 | Equity-type securities | |||
Financial instruments | |||
Financial assets | £ 1,006 | ||
Level 3 | Derivative liabilities | |||
Financial instruments | |||
Net financial instruments at fair value | (451) | ||
Financial liabilities | 455 | ||
With-profits | |||
Financial instruments | |||
Net financial instruments at fair value | 43,278 | ||
With-profits | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | 45 | ||
With-profits | Level 3 | |||
Financial instruments | |||
Net financial instruments at fair value | 159 | ||
Non-linked shareholder-backed | |||
Financial instruments | |||
Net financial instruments at fair value | 60,763 | ||
Non-linked shareholder-backed | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | 975 | ||
Non-linked shareholder-backed | Level 3 | |||
Financial instruments | |||
Net financial instruments at fair value | £ 396 | 266 | |
Reasonably possible decrease in valuation (as a percent) | 10.00% | ||
Amount of reasonably possible decrease in valuation | £ 40 | ||
Non-linked shareholder-backed | Level 3 | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | 455 | ||
REALIC of Jacksonville Plans, Inc | Level 3 | |||
Financial instruments | |||
Net financial instruments at fair value | (154) | ||
Financial assets | 2,799 | ||
Financial liabilities | 2,953 | ||
Entity excluding REALIC | Level 3 | |||
Financial instruments | |||
Net financial instruments at fair value | 555 | ||
Continuing and discontinued operations | |||
Financial instruments | |||
Net financial instruments at fair value | 368,625 | ||
Continuing and discontinued operations | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | 3,506 | ||
Continuing and discontinued operations | Level 3 | |||
Financial instruments | |||
Net financial instruments at fair value | 5,301 | £ 4,443 | |
Continuing and discontinued operations | Level 3 | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | 423 | £ 512 | |
Continuing and discontinued operations | With-profits | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | 1,316 | ||
Continuing and discontinued operations | Non-linked shareholder-backed | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | 2,185 | ||
Continuing and discontinued operations | Non-linked shareholder-backed | Level 3 | Derivative liabilities | |||
Financial instruments | |||
Financial liabilities | £ 423 | ||
Asia insurance operations | Level 3 | |||
Financial instruments | |||
Net financial instruments at fair value | £ 159 |
Group assets and liabilities _7
Group assets and liabilities - measurement - Transfers between levels (Details) £ in Millions | 6 Months Ended |
Jun. 30, 2019GBP (£) | |
Group assets and liabilities - measurement | |
Transfers from level 1 to level 2 | £ 131 |
Transfers from level 2 to level 1 | 618 |
Transfers into level 3 | 0 |
Transfers out of level 3 | £ 0 |
Debt securities - Credit rating
Debt securities - Credit rating analysis (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | ||
Financial investments | ||||
Debt securities | £ 99,675 | [1] | £ 89,400 | |
Continuing and discontinued operations | ||||
Financial investments | ||||
Debt securities | [1] | 175,356 | ||
UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 85,174 | 85,956 | ||
With-profits | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 54,796 | 53,798 | ||
Unit-linked | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 8,727 | 10,512 | ||
Non-linked shareholder-backed | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 21,651 | 21,646 | ||
AAA | ||||
Financial investments | ||||
Debt securities | 6,319 | 6,032 | ||
AAA | Continuing and discontinued operations | ||||
Financial investments | ||||
Debt securities | 16,970 | |||
AAA | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 8,770 | 10,938 | ||
AAA | With-profits | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 5,401 | 6,890 | ||
AAA | Unit-linked | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 578 | 1,041 | ||
AAA | Non-linked shareholder-backed | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 2,791 | 3,007 | ||
AA+ to AA- | ||||
Financial investments | ||||
Debt securities | 28,456 | 24,503 | ||
AA+ to AA- | Continuing and discontinued operations | ||||
Financial investments | ||||
Debt securities | 42,707 | |||
AA+ to AA- | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 16,628 | 18,204 | ||
AA+ to AA- | With-profits | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 8,488 | 9,332 | ||
AA+ to AA- | Unit-linked | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 2,025 | 2,459 | ||
AA+ to AA- | Non-linked shareholder-backed | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 6,115 | 6,413 | ||
A+ to A- | ||||
Financial investments | ||||
Debt securities | 21,297 | 18,848 | ||
A+ to A- | Continuing and discontinued operations | ||||
Financial investments | ||||
Debt securities | 37,493 | |||
A+ to A- | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 20,020 | 18,645 | ||
A+ to A- | With-profits | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 13,446 | 11,779 | ||
A+ to A- | Unit-linked | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 1,959 | 2,215 | ||
A+ to A- | Non-linked shareholder-backed | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 4,615 | 4,651 | ||
BBB+ to BBB- | ||||
Financial investments | ||||
Debt securities | 24,498 | 22,823 | ||
BBB+ to BBB- | Continuing and discontinued operations | ||||
Financial investments | ||||
Debt securities | 42,551 | |||
BBB+ to BBB- | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 19,746 | 19,728 | ||
BBB+ to BBB- | With-profits | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 15,641 | 14,712 | ||
BBB+ to BBB- | Unit-linked | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 2,450 | 3,501 | ||
BBB+ to BBB- | Non-linked shareholder-backed | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 1,655 | 1,515 | ||
Below BBB- | ||||
Financial investments | ||||
Debt securities | 6,516 | 5,853 | ||
Below BBB- | Continuing and discontinued operations | ||||
Financial investments | ||||
Debt securities | 9,297 | |||
Below BBB- | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 3,969 | 3,444 | ||
Below BBB- | With-profits | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 2,824 | 2,891 | ||
Below BBB- | Unit-linked | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 934 | 395 | ||
Below BBB- | Non-linked shareholder-backed | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 211 | 158 | ||
Other (including NAIC rated) | ||||
Financial investments | ||||
Debt securities | 12,589 | 11,341 | ||
Other (including NAIC rated) | Continuing and discontinued operations | ||||
Financial investments | ||||
Debt securities | 26,338 | |||
Other (including NAIC rated) | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 16,041 | 14,997 | ||
Other (including NAIC rated) | With-profits | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 8,996 | 8,194 | ||
Other (including NAIC rated) | Unit-linked | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 781 | 901 | ||
Other (including NAIC rated) | Non-linked shareholder-backed | UK & Europe Operations (M&G Prudential) | ||||
Financial investments | ||||
Debt securities | 6,264 | 5,902 | ||
Operating segments | Asia insurance operations | With-profits | ||||
Financial investments | ||||
Debt securities | 32,063 | 27,204 | ||
Operating segments | Asia insurance operations | Unit-linked | ||||
Financial investments | ||||
Debt securities | 3,603 | 3,981 | ||
Operating segments | Asia insurance operations | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 16,836 | 14,583 | ||
Operating segments | Asia insurance operations | AAA | With-profits | ||||
Financial investments | ||||
Debt securities | 3,131 | 2,873 | ||
Operating segments | Asia insurance operations | AAA | Unit-linked | ||||
Financial investments | ||||
Debt securities | 405 | 817 | ||
Operating segments | Asia insurance operations | AAA | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 1,072 | 1,034 | ||
Operating segments | Asia insurance operations | AA+ to AA- | With-profits | ||||
Financial investments | ||||
Debt securities | 14,977 | 12,379 | ||
Operating segments | Asia insurance operations | AA+ to AA- | Unit-linked | ||||
Financial investments | ||||
Debt securities | 196 | 100 | ||
Operating segments | Asia insurance operations | AA+ to AA- | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 4,155 | 3,552 | ||
Operating segments | Asia insurance operations | A+ to A- | With-profits | ||||
Financial investments | ||||
Debt securities | 4,688 | 4,142 | ||
Operating segments | Asia insurance operations | A+ to A- | Unit-linked | ||||
Financial investments | ||||
Debt securities | 458 | 492 | ||
Operating segments | Asia insurance operations | A+ to A- | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 4,458 | 3,717 | ||
Operating segments | Asia insurance operations | BBB+ to BBB- | With-profits | ||||
Financial investments | ||||
Debt securities | 4,621 | 3,760 | ||
Operating segments | Asia insurance operations | BBB+ to BBB- | Unit-linked | ||||
Financial investments | ||||
Debt securities | 1,502 | 1,431 | ||
Operating segments | Asia insurance operations | BBB+ to BBB- | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 3,287 | 2,934 | ||
Operating segments | Asia insurance operations | Below BBB- | With-profits | ||||
Financial investments | ||||
Debt securities | 2,016 | 1,747 | ||
Operating segments | Asia insurance operations | Below BBB- | Unit-linked | ||||
Financial investments | ||||
Debt securities | 378 | 426 | ||
Operating segments | Asia insurance operations | Below BBB- | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 2,493 | 2,202 | ||
Operating segments | Asia insurance operations | Other (including NAIC rated) | With-profits | ||||
Financial investments | ||||
Debt securities | 2,630 | 2,303 | ||
Operating segments | Asia insurance operations | Other (including NAIC rated) | Unit-linked | ||||
Financial investments | ||||
Debt securities | 664 | 715 | ||
Operating segments | Asia insurance operations | Other (including NAIC rated) | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 1,371 | 1,144 | ||
Operating segments | Asia asset management | ||||
Financial investments | ||||
Debt securities | 49 | 71 | ||
Operating segments | Asia asset management | AAA | ||||
Financial investments | ||||
Debt securities | 12 | 11 | ||
Operating segments | Asia asset management | A+ to A- | ||||
Financial investments | ||||
Debt securities | 37 | 60 | ||
Operating segments | US | ||||
Financial investments | ||||
Debt securities | 45,264 | 41,594 | ||
Operating segments | US | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 45,264 | 41,594 | ||
Operating segments | US | AAA | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 1,189 | 678 | ||
Operating segments | US | AA+ to AA- | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 7,984 | 7,383 | ||
Operating segments | US | A+ to A- | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 11,527 | 10,286 | ||
Operating segments | US | BBB+ to BBB- | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 15,068 | 14,657 | ||
Operating segments | US | Below BBB- | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 1,579 | 1,429 | ||
Operating segments | US | Other (including NAIC rated) | Non-linked shareholder-backed | ||||
Financial investments | ||||
Debt securities | 7,917 | 7,161 | ||
Unallocated to a segment (central or other operations) | ||||
Financial investments | ||||
Debt securities | 1,860 | 1,967 | ||
Unallocated to a segment (central or other operations) | AAA | ||||
Financial investments | ||||
Debt securities | 510 | 619 | ||
Unallocated to a segment (central or other operations) | AA+ to AA- | ||||
Financial investments | ||||
Debt securities | 1,144 | 1,089 | ||
Unallocated to a segment (central or other operations) | A+ to A- | ||||
Financial investments | ||||
Debt securities | 129 | 151 | ||
Unallocated to a segment (central or other operations) | BBB+ to BBB- | ||||
Financial investments | ||||
Debt securities | 20 | 41 | ||
Unallocated to a segment (central or other operations) | Below BBB- | ||||
Financial investments | ||||
Debt securities | 50 | 49 | ||
Unallocated to a segment (central or other operations) | Other (including NAIC rated) | ||||
Financial investments | ||||
Debt securities | £ 7 | £ 18 | ||
[1] | Included within equity securities and portfolio holdings in unit trusts, debt securities and other investments are £8 million of lent securities as at 30 June 2019 (31 December 2018: £8,278 million). |
Debt securities - Credit rati_2
Debt securities - Credit rating classified as Other (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | |
Financial investments | |||
Debt securities | £ 99,675 | [1] | £ 89,400 |
Other (including NAIC rated) | |||
Financial investments | |||
Debt securities | 12,589 | 11,341 | |
Operating segments | Asia insurance operations | Non-linked shareholder-backed | |||
Financial investments | |||
Debt securities | 16,836 | 14,583 | |
Operating segments | Asia insurance operations | Non-linked shareholder-backed | Other (including NAIC rated) | |||
Financial investments | |||
Debt securities | 1,371 | 1,144 | |
Operating segments | Asia insurance operations | Non-linked shareholder-backed | Other (including NAIC rated) | Government bonds | |||
Financial investments | |||
Debt securities | 37 | 36 | |
Operating segments | Asia insurance operations | Non-linked shareholder-backed | Other (including NAIC rated) | Corporate bonds | |||
Financial investments | |||
Debt securities | 1,215 | 978 | |
Operating segments | Asia insurance operations | Non-linked shareholder-backed | Other (including NAIC rated) | Other securities | |||
Financial investments | |||
Debt securities | 119 | 130 | |
Operating segments | US | |||
Financial investments | |||
Debt securities | 45,264 | 41,594 | |
Operating segments | US | Non-linked shareholder-backed | |||
Financial investments | |||
Debt securities | 45,264 | 41,594 | |
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | |||
Financial investments | |||
Debt securities | 7,917 | 7,161 | |
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | NAIC 1 | |||
Financial investments | |||
Debt securities | 5,521 | 5,006 | |
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | NAIC 2 | |||
Financial investments | |||
Debt securities | 2,357 | 2,118 | |
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | NAIC 3-6 | |||
Financial investments | |||
Debt securities | 39 | £ 37 | |
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | Mortgage-backed securities | |||
Financial investments | |||
Debt securities | 2,187 | ||
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | Mortgage-backed securities | NAIC 1 | |||
Financial investments | |||
Debt securities | 2,184 | ||
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | Mortgage-backed securities | NAIC 3-6 | |||
Financial investments | |||
Debt securities | 3 | ||
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | Mortgage-backed securities | Investment grade | |||
Financial investments | |||
Debt securities | 2,003 | ||
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | Other securities | |||
Financial investments | |||
Debt securities | 5,730 | ||
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | Other securities | NAIC 1 | |||
Financial investments | |||
Debt securities | 3,337 | ||
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | Other securities | NAIC 2 | |||
Financial investments | |||
Debt securities | 2,357 | ||
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | Other securities | NAIC 3-6 | |||
Financial investments | |||
Debt securities | 36 | ||
Operating segments | US | Non-linked shareholder-backed | Other (including NAIC rated) | Other securities | Investment grade | |||
Financial investments | |||
Debt securities | £ 5,694 | ||
[1] | Included within equity securities and portfolio holdings in unit trusts, debt securities and other investments are £8 million of lent securities as at 30 June 2019 (31 December 2018: £8,278 million). |
Debt securities - US operations
Debt securities - US operations (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | |
Financial investments | |||
Debt securities | £ 99,675 | [1] | £ 89,400 |
Operating segments | US | |||
Financial investments | |||
Debt securities | 45,264 | 41,594 | |
Operating segments | US | Available-for-sale | |||
Financial investments | |||
Debt securities | 44,178 | 40,849 | |
Operating segments | US | Fair value through profit or loss | |||
Financial investments | |||
Debt securities | 1,086 | 745 | |
Operating segments | US | Government | |||
Financial investments | |||
Debt securities | 6,094 | 5,465 | |
Operating segments | US | Publicly traded and SEC rule 144A securities | |||
Financial investments | |||
Debt securities | 27,419 | 26,196 | |
Operating segments | US | Non-SEC Rule 144A securities | |||
Financial investments | |||
Debt securities | 7,293 | 6,329 | |
Operating segments | US | Asset-backed securities | |||
Financial investments | |||
Debt securities | £ 4,458 | £ 3,604 | |
[1] | Included within equity securities and portfolio holdings in unit trusts, debt securities and other investments are £8 million of lent securities as at 30 June 2019 (31 December 2018: £8,278 million). |
Debt securities - Movements in
Debt securities - Movements in unrealised gains and losses (Details) £ in Millions | 6 Months Ended | ||||||||||||||||||
Jun. 30, 2019₫ / £ | Jun. 30, 2019$ / £ | Jun. 30, 2019฿ / £ | Jun. 30, 2019$ / £ | Jun. 30, 2019RM / £ | Jun. 30, 2019₨ / £ | Jun. 30, 2019Rp / £ | Jun. 30, 2019$ / £ | Jun. 30, 2019¥ / £ | Jun. 30, 2019GBP (£) | Jun. 30, 2018₫ / £ | Jun. 30, 2018$ / £ | Jun. 30, 2018฿ / £ | Jun. 30, 2018$ / £ | Jun. 30, 2018RM / £ | Jun. 30, 2018₨ / £ | Jun. 30, 2018Rp / £ | Jun. 30, 2018$ / £ | Jun. 30, 2018¥ / £ | |
Available-for-sale securities | |||||||||||||||||||
Available-for-sale debt securities at beginning of period | £ 40,849 | ||||||||||||||||||
Available-for-sale debt securities at end of period | 44,178 | ||||||||||||||||||
Average rate | 30,087.11 | 1.29 | 40.91 | 1.76 | 5.33 | 90.62 | 18,364.05 | 10.15 | 8.78 | 31,329.01 | 1.38 | 43.66 | 1.83 | 5.42 | 90.37 | 18,938.64 | 10.78 | 8.76 | |
Jackson (US insurance operations) | |||||||||||||||||||
Available-for-sale securities | |||||||||||||||||||
Average rate | $ / £ | 1.29 | 1.38 | |||||||||||||||||
Jackson (US insurance operations) | Debt securities | |||||||||||||||||||
Available-for-sale securities | |||||||||||||||||||
Available-for-sale debt securities at beginning of period | 40,849 | ||||||||||||||||||
Available-for-sale debt securities at end of period | 44,178 | ||||||||||||||||||
Average rate | $ / £ | 1.2939 | ||||||||||||||||||
Jackson (US insurance operations) | Cost/Gross amount | Debt securities | |||||||||||||||||||
Available-for-sale securities | |||||||||||||||||||
Available-for-sale debt securities at beginning of period | 41,263 | ||||||||||||||||||
Available-for-sale debt securities at end of period | 41,931 | ||||||||||||||||||
Jackson (US insurance operations) | Unrealised gain (loss) | Debt securities | |||||||||||||||||||
Available-for-sale securities | |||||||||||||||||||
Available-for-sale debt securities at beginning of period | (414) | ||||||||||||||||||
Foreign exchange translation reflected as part of movement in other comprehensive income | 44 | ||||||||||||||||||
Changes in unrealised appreciation reflected as part of movement in other comprehensive income | 2,617 | ||||||||||||||||||
Available-for-sale debt securities at end of period | 2,247 | ||||||||||||||||||
Jackson (US insurance operations) | Assets fair valued at below book value | Debt securities | |||||||||||||||||||
Available-for-sale securities | |||||||||||||||||||
Available-for-sale debt securities at beginning of period | 24,405 | ||||||||||||||||||
Available-for-sale debt securities at end of period | 2,290 | ||||||||||||||||||
Jackson (US insurance operations) | Assets fair valued at below book value | Cost/Gross amount | Debt securities | |||||||||||||||||||
Available-for-sale securities | |||||||||||||||||||
Available-for-sale debt securities at beginning of period | 25,330 | ||||||||||||||||||
Available-for-sale debt securities at end of period | 2,339 | ||||||||||||||||||
Jackson (US insurance operations) | Assets fair valued at below book value | Unrealised gain (loss) | Debt securities | |||||||||||||||||||
Available-for-sale securities | |||||||||||||||||||
Available-for-sale debt securities at beginning of period | (925) | ||||||||||||||||||
Foreign exchange translation reflected as part of movement in other comprehensive income | 14 | ||||||||||||||||||
Changes in unrealised appreciation reflected as part of movement in other comprehensive income | 862 | ||||||||||||||||||
Available-for-sale debt securities at end of period | (49) | ||||||||||||||||||
Jackson (US insurance operations) | Assets fair valued at or above book value | Debt securities | |||||||||||||||||||
Available-for-sale securities | |||||||||||||||||||
Available-for-sale debt securities at beginning of period | 16,444 | ||||||||||||||||||
Available-for-sale debt securities at end of period | 41,888 | ||||||||||||||||||
Jackson (US insurance operations) | Assets fair valued at or above book value | Cost/Gross amount | Debt securities | |||||||||||||||||||
Available-for-sale securities | |||||||||||||||||||
Available-for-sale debt securities at beginning of period | 15,933 | ||||||||||||||||||
Available-for-sale debt securities at end of period | 39,592 | ||||||||||||||||||
Jackson (US insurance operations) | Assets fair valued at or above book value | Unrealised gain (loss) | Debt securities | |||||||||||||||||||
Available-for-sale securities | |||||||||||||||||||
Available-for-sale debt securities at beginning of period | 511 | ||||||||||||||||||
Foreign exchange translation reflected as part of movement in other comprehensive income | 30 | ||||||||||||||||||
Changes in unrealised appreciation reflected as part of movement in other comprehensive income | 1,755 | ||||||||||||||||||
Available-for-sale debt securities at end of period | £ 2,296 |
Debt securities - Unrealised lo
Debt securities - Unrealised loss positions (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Available-for-sale securities | ||
Financial assets classified as available-for-sale | £ 44,178 | £ 40,849 |
Jackson (US insurance operations) | Debt securities | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | 44,178 | 40,849 |
Jackson (US insurance operations) | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | 2,247 | (414) |
Jackson (US insurance operations) | Assets fair valued at below book value | Debt securities | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | 2,290 | 24,405 |
Jackson (US insurance operations) | Assets fair valued at below book value | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (49) | (925) |
Jackson (US insurance operations) | Assets fair valued at below book value | Non-investment grade | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (3) | (54) |
Jackson (US insurance operations) | Assets fair valued at below book value | Investment grade | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (46) | (871) |
Jackson (US insurance operations) | Assets fair valued at below book value | 1 to 5 years | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (2) | (72) |
Jackson (US insurance operations) | Assets fair valued at below book value | 5 years to 10 years | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (10) | (436) |
Jackson (US insurance operations) | Assets fair valued at below book value | More than 10 years | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (19) | (372) |
Jackson (US insurance operations) | Assets fair valued at below book value | Mortgage-backed and other debt securities | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (18) | (45) |
Jackson (US insurance operations) | Assets fair valued at below book value | Between 90% and 100% | Debt securities | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | 2,221 | 23,662 |
Jackson (US insurance operations) | Assets fair valued at below book value | Between 90% and 100% | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (32) | (809) |
Jackson (US insurance operations) | Assets fair valued at below book value | Between 80% and 90% | Debt securities | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | 38 | 707 |
Jackson (US insurance operations) | Assets fair valued at below book value | Between 80% and 90% | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (5) | (104) |
Jackson (US insurance operations) | Assets fair valued at below book value | Below 80% | Debt securities | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | 31 | 36 |
Jackson (US insurance operations) | Assets fair valued at below book value | Below 80% | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (12) | (12) |
Jackson (US insurance operations) | Less than 6 months | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (5) | (161) |
Jackson (US insurance operations) | Less than 6 months | Non-investment grade | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (1) | (20) |
Jackson (US insurance operations) | Less than 6 months | Investment grade | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (4) | (141) |
Jackson (US insurance operations) | 6 months to 1 year | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (14) | (462) |
Jackson (US insurance operations) | 6 months to 1 year | Non-investment grade | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (1) | (22) |
Jackson (US insurance operations) | 6 months to 1 year | Investment grade | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (13) | (440) |
Jackson (US insurance operations) | 1 year to 2 years | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (10) | (152) |
Jackson (US insurance operations) | 1 year to 2 years | Non-investment grade | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (1) | (10) |
Jackson (US insurance operations) | 1 year to 2 years | Investment grade | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (9) | (142) |
Jackson (US insurance operations) | 2 years to 3 years | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (10) | (123) |
Jackson (US insurance operations) | 2 years to 3 years | Investment grade | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (10) | (123) |
Jackson (US insurance operations) | More than 3 years | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (10) | (27) |
Jackson (US insurance operations) | More than 3 years | Non-investment grade | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (2) | |
Jackson (US insurance operations) | More than 3 years | Investment grade | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (10) | (25) |
Jackson (US insurance operations) | Less than 3 months | Below 80% | Debt securities | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | 26 | 32 |
Jackson (US insurance operations) | Less than 3 months | Below 80% | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | (10) | (10) |
Jackson (US insurance operations) | 3 months to 6 months | Below 80% | Debt securities | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | 5 | 2 |
Jackson (US insurance operations) | 3 months to 6 months | Below 80% | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | £ (2) | (1) |
Jackson (US insurance operations) | More than 6 months | Below 80% | Debt securities | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | 2 | |
Jackson (US insurance operations) | More than 6 months | Below 80% | Debt securities | Unrealised gain (loss) | ||
Available-for-sale securities | ||
Financial assets classified as available-for-sale | £ (1) |
Debt securities - Asset-backed
Debt securities - Asset-backed securities (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Financial investments | ||
Asset-backed securities | £ 5,155 | £ 4,405 |
Continuing and discontinued operations | ||
Financial investments | ||
Asset-backed securities | 11,081 | |
UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Asset-backed securities | £ 6,676 | |
Operating segments | Asia | Investment grade | ||
Financial investments | ||
Percentage for credit rating category | 100.00% | 99.80% |
Shareholder-backed | Operating segments | Asia | ||
Financial investments | ||
Asset-backed securities | £ 126 | £ 121 |
Shareholder-backed | Operating segments | US | ||
Financial investments | ||
Asset-backed securities | £ 4,458 | 3,604 |
Shareholder-backed | Operating segments | AAA | US | ||
Financial investments | ||
Percentage for credit rating category | 52.00% | |
Shareholder-backed | Operating segments | AA | US | ||
Financial investments | ||
Percentage for credit rating category | 21.00% | |
Shareholder-backed | Operating segments | A | US | ||
Financial investments | ||
Percentage for credit rating category | 18.00% | |
Shareholder-backed | Operating segments | RMBS Sub-prime | US | ||
Financial investments | ||
Asset-backed securities | £ 88 | 96 |
Shareholder-backed | Operating segments | RMBS Sub-prime | AAA | US | ||
Financial investments | ||
Percentage for credit rating category | 2.00% | |
Shareholder-backed | Operating segments | RMBS Sub-prime | AA | US | ||
Financial investments | ||
Percentage for credit rating category | 5.00% | |
Shareholder-backed | Operating segments | RMBS Sub-prime | A | US | ||
Financial investments | ||
Percentage for credit rating category | 2.00% | |
Shareholder-backed | Operating segments | Alt-A | US | ||
Financial investments | ||
Asset-backed securities | £ 101 | 105 |
Shareholder-backed | Operating segments | Alt-A | AAA | US | ||
Financial investments | ||
Percentage for credit rating category | 17.00% | |
Shareholder-backed | Operating segments | Alt-A | A | US | ||
Financial investments | ||
Percentage for credit rating category | 34.00% | |
Shareholder-backed | Operating segments | Prime including agency | US | ||
Financial investments | ||
Asset-backed securities | £ 579 | 441 |
Shareholder-backed | Operating segments | Prime including agency | AAA | US | ||
Financial investments | ||
Percentage for credit rating category | 39.00% | |
Shareholder-backed | Operating segments | Prime including agency | AA | US | ||
Financial investments | ||
Percentage for credit rating category | 45.00% | |
Shareholder-backed | Operating segments | Prime including agency | A | US | ||
Financial investments | ||
Percentage for credit rating category | 7.00% | |
Shareholder-backed | Operating segments | CMBS | US | ||
Financial investments | ||
Asset-backed securities | £ 2,266 | 1,945 |
Shareholder-backed | Operating segments | CMBS | AAA | US | ||
Financial investments | ||
Percentage for credit rating category | 78.00% | |
Shareholder-backed | Operating segments | CMBS | AA | US | ||
Financial investments | ||
Percentage for credit rating category | 16.00% | |
Shareholder-backed | Operating segments | CMBS | A | US | ||
Financial investments | ||
Percentage for credit rating category | 3.00% | |
Shareholder-backed | Operating segments | CDO funds | US | ||
Financial investments | ||
Asset-backed securities | £ 353 | 13 |
Shareholder-backed | Operating segments | CDO funds | AAA | US | ||
Financial investments | ||
Percentage for credit rating category | 37.00% | |
Shareholder-backed | Operating segments | CDO funds | AA | US | ||
Financial investments | ||
Percentage for credit rating category | 33.00% | |
Shareholder-backed | Operating segments | CDO funds | A | US | ||
Financial investments | ||
Percentage for credit rating category | 30.00% | |
Shareholder-backed | Operating segments | Other asset-backed securities | US | ||
Financial investments | ||
Asset-backed securities | £ 1,071 | 1,004 |
Shareholder-backed | Operating segments | Other asset-backed securities | US | Sub-prime | ||
Financial investments | ||
Asset-backed securities | £ 59 | |
Shareholder-backed | Operating segments | Other asset-backed securities | AAA | US | ||
Financial investments | ||
Percentage for credit rating category | 15.00% | |
Shareholder-backed | Operating segments | Other asset-backed securities | AA | US | ||
Financial investments | ||
Percentage for credit rating category | 16.00% | |
Shareholder-backed | Operating segments | Other asset-backed securities | A | US | ||
Financial investments | ||
Percentage for credit rating category | 52.00% | |
Shareholder-backed | Unallocated to a segment (central or other operations) | ||
Financial investments | ||
Asset-backed securities | £ 315 | £ 445 |
Shareholder-backed | Unallocated to a segment (central or other operations) | AAA | ||
Financial investments | ||
Percentage for credit rating category | 100.00% | 99.00% |
With-profits | Operating segments | Asia | ||
Financial investments | ||
Asset-backed securities | £ 256 | £ 235 |
Debt securities - Group soverei
Debt securities - Group sovereign debt and bank debt exposure (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Shareholder-backed | ||
Financial investments | ||
Sovereign debt exposure | £ 11,658 | |
Bank debt instruments held | 4,640 | |
Shareholder-backed | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | £ 12,140 | 14,393 |
Bank debt instruments held | 4,628 | 5,727 |
Shareholder-backed | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 2,707 | 2,735 |
Bank debt instruments held | 1,261 | 1,087 |
Shareholder-backed | Eurozone | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 378 | |
Bank debt instruments held | 322 | 477 |
Shareholder-backed | Eurozone | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 412 | 378 |
Bank debt instruments held | 184 | 120 |
Shareholder-backed | Spain | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 70 | 106 |
Shareholder-backed | Spain | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 49 | 36 |
Shareholder-backed | France | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 151 | 156 |
Shareholder-backed | France | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 23 | |
Bank debt instruments held | 57 | 20 |
Shareholder-backed | Germany | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 42 | 125 |
Shareholder-backed | Germany | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 240 | 239 |
Bank debt instruments held | 90 | 83 |
Shareholder-backed | Netherlands | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 59 | 73 |
Shareholder-backed | Netherlands | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 37 | 17 |
Shareholder-backed | Other Eurozone | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 17 | |
Shareholder-backed | Other Eurozone | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 100 | 103 |
Shareholder-backed | UK | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 988 | 3,226 |
Bank debt instruments held | 701 | 1,346 |
Shareholder-backed | UK | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 2,235 | 2,300 |
Bank debt instruments held | 760 | 674 |
Shareholder-backed | US | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 6,410 | 5,647 |
Bank debt instruments held | 2,386 | 2,667 |
Shareholder-backed | US | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 281 | 253 |
Shareholder-backed | Asia | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 674 | 592 |
Shareholder-backed | Indonesia | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 295 | 282 |
Shareholder-backed | Singapore | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 132 | 164 |
Shareholder-backed | Thailand | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 1,106 | 921 |
Shareholder-backed | Vietnam | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 1,186 | 1,871 |
Shareholder-backed | Other Asia | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 1,925 | 1,779 |
Shareholder-backed | Other | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 98 | 125 |
Bank debt instruments held | 545 | 645 |
Shareholder-backed | Other | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 60 | 57 |
Bank debt instruments held | 36 | 40 |
Shareholder-backed | Senior debt | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 3,968 | |
Shareholder-backed | Senior debt | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 1,039 | |
Shareholder-backed | Senior debt | Eurozone | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 298 | |
Shareholder-backed | Senior debt | Eurozone | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 94 | |
Shareholder-backed | Senior debt | Spain | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 70 | |
Shareholder-backed | Senior debt | France | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 142 | |
Shareholder-backed | Senior debt | France | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 57 | |
Shareholder-backed | Senior debt | Germany | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 30 | |
Shareholder-backed | Senior debt | Netherlands | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 56 | |
Shareholder-backed | Senior debt | Netherlands | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 37 | |
Shareholder-backed | Senior debt | UK | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 598 | |
Shareholder-backed | Senior debt | UK | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 693 | |
Shareholder-backed | Senior debt | US | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 2,354 | |
Shareholder-backed | Senior debt | US | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 252 | |
Shareholder-backed | Senior debt | Asia | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 248 | |
Shareholder-backed | Senior debt | Other | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 470 | |
Shareholder-backed | Subordinated debt | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 660 | |
Shareholder-backed | Subordinated debt | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 222 | |
Shareholder-backed | Subordinated debt | Eurozone | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 24 | |
Shareholder-backed | Subordinated debt | Eurozone | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 90 | |
Shareholder-backed | Subordinated debt | France | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 9 | |
Shareholder-backed | Subordinated debt | Germany | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 12 | |
Shareholder-backed | Subordinated debt | Germany | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 90 | |
Shareholder-backed | Subordinated debt | Netherlands | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 3 | |
Shareholder-backed | Subordinated debt | UK | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 103 | |
Shareholder-backed | Subordinated debt | UK | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 67 | |
Shareholder-backed | Subordinated debt | US | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 32 | |
Shareholder-backed | Subordinated debt | US | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 29 | |
Shareholder-backed | Subordinated debt | Asia | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 426 | |
Shareholder-backed | Subordinated debt | Other | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 75 | |
Shareholder-backed | Subordinated debt | Other | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 36 | |
Shareholder-backed | Tier 1 subordinated debt | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 123 | |
Shareholder-backed | Tier 1 subordinated debt | UK | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 8 | |
Shareholder-backed | Tier 1 subordinated debt | US | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 1 | |
Shareholder-backed | Tier 1 subordinated debt | Asia | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 114 | |
Shareholder-backed | Tier 2 subordinated debt | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 537 | |
Shareholder-backed | Tier 2 subordinated debt | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 222 | |
Shareholder-backed | Tier 2 subordinated debt | Eurozone | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 24 | |
Shareholder-backed | Tier 2 subordinated debt | Eurozone | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 90 | |
Shareholder-backed | Tier 2 subordinated debt | France | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 9 | |
Shareholder-backed | Tier 2 subordinated debt | Germany | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 12 | |
Shareholder-backed | Tier 2 subordinated debt | Germany | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 90 | |
Shareholder-backed | Tier 2 subordinated debt | Netherlands | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 3 | |
Shareholder-backed | Tier 2 subordinated debt | UK | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 95 | |
Shareholder-backed | Tier 2 subordinated debt | UK | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 67 | |
Shareholder-backed | Tier 2 subordinated debt | US | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 31 | |
Shareholder-backed | Tier 2 subordinated debt | US | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 29 | |
Shareholder-backed | Tier 2 subordinated debt | Asia | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 312 | |
Shareholder-backed | Tier 2 subordinated debt | Other | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 75 | |
Shareholder-backed | Tier 2 subordinated debt | Other | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 36 | |
With-profits | ||
Financial investments | ||
Sovereign debt exposure | 13,144 | |
Bank debt instruments held | 1,287 | |
With-profits | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 15,613 | 18,056 |
Bank debt instruments held | 1,378 | 8,725 |
With-profits | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 3,911 | 4,912 |
Bank debt instruments held | 7,996 | 7,438 |
With-profits | Eurozone | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 440 | |
Bank debt instruments held | 101 | 976 |
With-profits | Eurozone | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 435 | 440 |
Bank debt instruments held | 1,069 | 911 |
With-profits | Italy | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 38 | |
With-profits | Italy | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 59 | 57 |
Bank debt instruments held | 39 | 38 |
With-profits | Spain | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 2 | 17 |
With-profits | Spain | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 19 | 18 |
Bank debt instruments held | 26 | 17 |
With-profits | France | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 34 | 352 |
With-profits | France | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 50 | |
Bank debt instruments held | 443 | 348 |
With-profits | Germany | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 47 | 229 |
With-profits | Germany | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 324 | 281 |
Bank debt instruments held | 187 | 185 |
With-profits | Netherlands | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 18 | 266 |
With-profits | Netherlands | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 288 | 249 |
With-profits | Other Eurozone | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 74 | |
With-profits | Other Eurozone | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 33 | 34 |
Bank debt instruments held | 86 | 74 |
With-profits | UK | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 3,013 | |
Bank debt instruments held | 115 | 2,194 |
With-profits | UK | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 2,636 | 3,013 |
Bank debt instruments held | 2,124 | 2,096 |
With-profits | US | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 12,925 | 11,858 |
Bank debt instruments held | 20 | 2,730 |
With-profits | US | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 632 | 1,261 |
Bank debt instruments held | 3,122 | 2,709 |
With-profits | Asia | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 941 | 1,015 |
With-profits | Asia | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 127 | 106 |
With-profits | Singapore | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 1,719 | 1,658 |
With-profits | Other Asia | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 944 | 866 |
With-profits | Other | Continuing and discontinued operations | ||
Financial investments | ||
Sovereign debt exposure | 25 | 221 |
Bank debt instruments held | 201 | 1,810 |
With-profits | Other | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Sovereign debt exposure | 208 | 198 |
Bank debt instruments held | 1,554 | £ 1,616 |
With-profits | Senior debt | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 402 | |
With-profits | Senior debt | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 7,139 | |
With-profits | Senior debt | Eurozone | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 17 | |
With-profits | Senior debt | Eurozone | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 987 | |
With-profits | Senior debt | Italy | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 39 | |
With-profits | Senior debt | Spain | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 2 | |
With-profits | Senior debt | Spain | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 26 | |
With-profits | Senior debt | France | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 7 | |
With-profits | Senior debt | France | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 369 | |
With-profits | Senior debt | Germany | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 179 | |
With-profits | Senior debt | Netherlands | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 8 | |
With-profits | Senior debt | Netherlands | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 288 | |
With-profits | Senior debt | Other Eurozone | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 86 | |
With-profits | Senior debt | UK | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 31 | |
With-profits | Senior debt | UK | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 1,750 | |
With-profits | Senior debt | US | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 16 | |
With-profits | Senior debt | US | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 2,771 | |
With-profits | Senior debt | Asia | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 279 | |
With-profits | Senior debt | Asia | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 127 | |
With-profits | Senior debt | Other | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 59 | |
With-profits | Senior debt | Other | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 1,504 | |
With-profits | Subordinated debt | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 976 | |
With-profits | Subordinated debt | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 857 | |
With-profits | Subordinated debt | Eurozone | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 84 | |
With-profits | Subordinated debt | Eurozone | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 82 | |
With-profits | Subordinated debt | France | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 27 | |
With-profits | Subordinated debt | France | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 74 | |
With-profits | Subordinated debt | Germany | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 47 | |
With-profits | Subordinated debt | Germany | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 8 | |
With-profits | Subordinated debt | Netherlands | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 10 | |
With-profits | Subordinated debt | UK | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 84 | |
With-profits | Subordinated debt | UK | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 374 | |
With-profits | Subordinated debt | US | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 4 | |
With-profits | Subordinated debt | US | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 351 | |
With-profits | Subordinated debt | Asia | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 662 | |
With-profits | Subordinated debt | Other | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 142 | |
With-profits | Subordinated debt | Other | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 50 | |
With-profits | Tier 1 subordinated debt | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 366 | |
With-profits | Tier 1 subordinated debt | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 83 | |
With-profits | Tier 1 subordinated debt | UK | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 2 | |
With-profits | Tier 1 subordinated debt | UK | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 52 | |
With-profits | Tier 1 subordinated debt | US | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 1 | |
With-profits | Tier 1 subordinated debt | US | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 16 | |
With-profits | Tier 1 subordinated debt | Asia | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 363 | |
With-profits | Tier 1 subordinated debt | Other | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 15 | |
With-profits | Tier 2 subordinated debt | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 610 | |
With-profits | Tier 2 subordinated debt | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 774 | |
With-profits | Tier 2 subordinated debt | Eurozone | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 84 | |
With-profits | Tier 2 subordinated debt | Eurozone | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 82 | |
With-profits | Tier 2 subordinated debt | France | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 27 | |
With-profits | Tier 2 subordinated debt | France | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 74 | |
With-profits | Tier 2 subordinated debt | Germany | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 47 | |
With-profits | Tier 2 subordinated debt | Germany | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 8 | |
With-profits | Tier 2 subordinated debt | Netherlands | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 10 | |
With-profits | Tier 2 subordinated debt | UK | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 82 | |
With-profits | Tier 2 subordinated debt | UK | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 322 | |
With-profits | Tier 2 subordinated debt | US | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 3 | |
With-profits | Tier 2 subordinated debt | US | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | 335 | |
With-profits | Tier 2 subordinated debt | Asia | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 299 | |
With-profits | Tier 2 subordinated debt | Other | Continuing and discontinued operations | ||
Financial investments | ||
Bank debt instruments held | 142 | |
With-profits | Tier 2 subordinated debt | Other | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Bank debt instruments held | £ 35 |
Loans portfolio - Components (D
Loans portfolio - Components (Details) - GBP (£) £ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Financial investments | ||
Loans | £ 12,513 | £ 12,443 |
Continuing and discontinued operations | ||
Financial investments | ||
Loans | 18,010 | |
UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Loans | 5,535 | 5,567 |
Mortgage loans | ||
Financial investments | ||
Loans | 7,727 | 7,541 |
Mortgage loans | Continuing and discontinued operations | ||
Financial investments | ||
Loans | 11,657 | |
Mortgage loans | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Loans | 3,971 | 4,116 |
Policy loans | ||
Financial investments | ||
Loans | 4,702 | 4,634 |
Policy loans | Continuing and discontinued operations | ||
Financial investments | ||
Loans | 4,637 | |
Policy loans | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Loans | 3 | 3 |
Other loans | ||
Financial investments | ||
Loans | 84 | 268 |
Other loans | Continuing and discontinued operations | ||
Financial investments | ||
Loans | 1,716 | |
Other loans | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Loans | 1,561 | 1,448 |
With-profits | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Loans | 3,756 | 3,853 |
With-profits | Mortgage loans | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Loans | 2,260 | 2,461 |
With-profits | Policy loans | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Loans | 3 | 3 |
With-profits | Other loans | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Loans | 1,493 | 1,389 |
Non-linked shareholder-backed | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Loans | 1,779 | 1,714 |
Non-linked shareholder-backed | Mortgage loans | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Loans | 1,711 | 1,655 |
Non-linked shareholder-backed | Other loans | UK & Europe Operations (M&G Prudential) | ||
Financial investments | ||
Loans | 68 | 59 |
Operating segments | Asia | With-profits | ||
Financial investments | ||
Loans | 846 | 792 |
Operating segments | Asia | With-profits | Policy loans | ||
Financial investments | ||
Loans | 783 | 727 |
Operating segments | Asia | With-profits | Other loans | ||
Financial investments | ||
Loans | 63 | 65 |
Operating segments | Asia | Non-linked shareholder-backed | ||
Financial investments | ||
Loans | 388 | 585 |
Operating segments | Asia | Non-linked shareholder-backed | Mortgage loans | ||
Financial investments | ||
Loans | 140 | 156 |
Operating segments | Asia | Non-linked shareholder-backed | Policy loans | ||
Financial investments | ||
Loans | 233 | 226 |
Operating segments | Asia | Non-linked shareholder-backed | Other loans | ||
Financial investments | ||
Loans | 15 | 203 |
Operating segments | US | Mortgage loans | Average | ||
Financial investments | ||
Loans | £ 14.7 | £ 14 |
Estimated loan to value (as a percent) | 53.00% | 53.00% |
Operating segments | US | Non-linked shareholder-backed | ||
Financial investments | ||
Loans | £ 11,273 | £ 11,066 |
Operating segments | US | Non-linked shareholder-backed | Mortgage loans | ||
Financial investments | ||
Loans | 7,587 | 7,385 |
Operating segments | US | Non-linked shareholder-backed | Policy loans | ||
Financial investments | ||
Loans | 3,686 | 3,681 |
Accounted for at fair value through profit or loss | 2,799 | 2,783 |
Operating segments | Jackson (US insurance operations) | Mortgage loans | ||
Financial investments | ||
Loans with restructured contractual terms | 0 | £ 0 |
Unallocated to a segment (central or other operations) | ||
Financial investments | ||
Loans | 6 | |
Unallocated to a segment (central or other operations) | Other loans | ||
Financial investments | ||
Loans | £ 6 |
Policyholder liabilities and _3
Policyholder liabilities and unallocated surplus - Analysis of movements (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | £ 285,168 | |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,944 | |
Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Reclassification of UK and Europe's liabilities as held for distribution | (164,889) | |
Premiums | 14,634 | |
Surrenders | (7,929) | |
Maturities/deaths | (2,337) | |
Net flows | 4,368 | |
Shareholders' transfers post-tax | (38) | |
Investment-related items and other movements | 22,980 | |
Foreign exchange translation differences | 1,076 | |
Ending Balance | 296,749 | |
Policyholder liabilities on the consolidated statement of financial position | 285,121 | |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,944 | |
Group's share of policyholder liabilities of joint ventures and associates | 8,684 | |
Operating segments after elimination, before unallocated | Shareholder-backed | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Reclassification of UK and Europe's liabilities as held for distribution | (40,760) | |
Premiums | 10,983 | |
Surrenders | (7,722) | |
Maturities/deaths | (1,787) | |
Net flows | 1,474 | |
Investment-related items and other movements | 18,461 | |
Foreign exchange translation differences | 740 | |
Ending Balance | 246,872 | |
Policyholder liabilities on the consolidated statement of financial position | 238,188 | |
Group's share of policyholder liabilities of joint ventures and associates | 8,684 | |
Unallocated to a segment (central or other operations) | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | 39 | £ 32 |
Policyholder liabilities on the consolidated statement of financial position | 47 | 37 |
Unallocated to a segment (central or other operations) | Shareholder-backed | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | 47 | 37 |
Asia insurance operations | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 82,763 | 73,839 |
Policyholder liabilities on the consolidated statement of financial position | 72,107 | 62,898 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,511 | 3,474 |
Group's share of policyholder liabilities of joint ventures and associates | 8,145 | 7,467 |
Premiums | 7,574 | 6,247 |
Surrenders | (1,531) | (1,547) |
Maturities/deaths | (989) | (838) |
Net flows | 5,054 | 3,862 |
Shareholders' transfers post-tax | (38) | (27) |
Investment-related items and other movements | 6,142 | (1,349) |
Foreign exchange translation differences | 676 | 690 |
Ending Balance | 94,597 | 77,015 |
Policyholder liabilities on the consolidated statement of financial position | 82,969 | 65,640 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,944 | 3,766 |
Group's share of policyholder liabilities of joint ventures and associates | 8,684 | 7,609 |
Average policyholder liability balances | 85,953 | 71,807 |
Asia insurance operations | Operating segments after elimination, before unallocated | Shareholder-backed | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Premiums | 3,923 | |
Surrenders | (1,324) | |
Maturities/deaths | (439) | |
Net flows | 2,160 | |
Investment-related items and other movements | 1,623 | |
Foreign exchange translation differences | 340 | |
Ending Balance | 44,720 | |
Policyholder liabilities on the consolidated statement of financial position | 36,036 | |
Group's share of policyholder liabilities of joint ventures and associates | 8,684 | |
Asia insurance operations | Deductions for intra-group reinsurance | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | 1,108 | 1,181 |
Asia insurance operations | Operating segments after deductions of intra-group reinsurance | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | 84,077 | 66,821 |
Jackson (US insurance operations) | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | 185,600 | 180,724 |
Premiums | 7,060 | 7,111 |
Surrenders | (6,398) | (5,953) |
Maturities/deaths | (1,348) | (1,076) |
Net flows | (686) | 82 |
Investment-related items and other movements | 16,838 | (103) |
Foreign exchange translation differences | 400 | 4,447 |
Ending Balance | 202,152 | |
Policyholder liabilities on the consolidated statement of financial position | 202,152 | 185,150 |
Average policyholder liability balances | 193,876 | 182,937 |
Jackson (US insurance operations) | Operating segments after elimination, before unallocated | Shareholder-backed | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Premiums | 7,060 | |
Surrenders | (6,398) | |
Maturities/deaths | (1,348) | |
Net flows | (686) | |
Investment-related items and other movements | 16,838 | |
Foreign exchange translation differences | 400 | |
Ending Balance | 202,152 | |
Policyholder liabilities on the consolidated statement of financial position | 202,152 | |
UK and Europe insurance operations | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Reclassification of UK and Europe's liabilities as held for distribution | (164,889) | |
UK and Europe insurance operations | Operating segments after elimination, before unallocated | Shareholder-backed | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Reclassification of UK and Europe's liabilities as held for distribution | (40,760) | |
Continuing and discontinued operations | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | 409,301 | |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 15,845 | |
Continuing and discontinued operations | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 433,252 | 435,629 |
Policyholder liabilities on the consolidated statement of financial position | 409,262 | 411,211 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 15,845 | 16,951 |
Group's share of policyholder liabilities of joint ventures and associates | 8,145 | 7,467 |
Reclassification of reinsured UK annuity contracts as held for sale | (12,002) | |
Premiums | 20,322 | |
Surrenders | (10,946) | |
Maturities/deaths | (5,413) | |
Net flows | 3,963 | |
Shareholders' transfers post-tax | (154) | |
Investment-related items and other movements | (2,253) | |
Foreign exchange translation differences | 5,154 | |
Ending Balance | 430,337 | |
Policyholder liabilities on the consolidated statement of financial position | 405,445 | |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 17,283 | |
Group's share of policyholder liabilities of joint ventures and associates | 7,609 | |
Average policyholder liability balances | 279,829 | 415,866 |
Continuing and discontinued operations | Operating segments after elimination, before unallocated | Shareholder-backed | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 266,957 | 274,493 |
Reclassification of reinsured UK annuity contracts as held for sale | (12,002) | |
Premiums | 11,058 | |
Surrenders | (8,536) | |
Maturities/deaths | (2,790) | |
Net flows | (268) | |
Investment-related items and other movements | (1,057) | |
Foreign exchange translation differences | 4,448 | |
Ending Balance | 265,614 | |
Policyholder liabilities on the consolidated statement of financial position | 258,005 | |
Group's share of policyholder liabilities of joint ventures and associates | 7,609 | |
Continuing and discontinued operations | Asia insurance operations | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 82,763 | 73,839 |
Policyholder liabilities on the consolidated statement of financial position | 72,107 | 62,898 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,511 | 3,474 |
Group's share of policyholder liabilities of joint ventures and associates | 8,145 | 7,467 |
Premiums | 6,247 | |
Surrenders | (1,547) | |
Maturities/deaths | (838) | |
Net flows | 3,862 | |
Shareholders' transfers post-tax | (27) | |
Investment-related items and other movements | (1,349) | |
Foreign exchange translation differences | 690 | |
Ending Balance | 77,015 | |
Policyholder liabilities on the consolidated statement of financial position | 65,640 | |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 3,766 | |
Group's share of policyholder liabilities of joint ventures and associates | 7,609 | |
Average policyholder liability balances | 85,953 | 71,807 |
Continuing and discontinued operations | Asia insurance operations | Operating segments after elimination, before unallocated | Shareholder-backed | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 40,597 | 37,402 |
Premiums | 3,266 | |
Surrenders | (1,383) | |
Maturities/deaths | (420) | |
Net flows | 1,463 | |
Investment-related items and other movements | (718) | |
Foreign exchange translation differences | 1 | |
Ending Balance | 38,148 | |
Policyholder liabilities on the consolidated statement of financial position | 30,539 | |
Group's share of policyholder liabilities of joint ventures and associates | 7,609 | |
Continuing and discontinued operations | Jackson (US insurance operations) | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 185,600 | 180,724 |
Policyholder liabilities on the consolidated statement of financial position | 185,600 | 180,724 |
Premiums | 7,111 | |
Surrenders | (5,953) | |
Maturities/deaths | (1,076) | |
Net flows | 82 | |
Investment-related items and other movements | (103) | |
Foreign exchange translation differences | 4,447 | |
Ending Balance | 185,150 | |
Policyholder liabilities on the consolidated statement of financial position | 185,150 | |
Average policyholder liability balances | 193,876 | 182,937 |
Continuing and discontinued operations | Jackson (US insurance operations) | Operating segments after elimination, before unallocated | Shareholder-backed | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 185,600 | 180,724 |
Premiums | 7,111 | |
Surrenders | (5,953) | |
Maturities/deaths | (1,076) | |
Net flows | 82 | |
Investment-related items and other movements | (103) | |
Foreign exchange translation differences | 4,447 | |
Ending Balance | 185,150 | |
Policyholder liabilities on the consolidated statement of financial position | 185,150 | |
Continuing and discontinued operations | UK and Europe insurance operations | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 164,889 | 181,066 |
Policyholder liabilities on the consolidated statement of financial position | 151,555 | 167,589 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 13,334 | 13,477 |
Reclassification of reinsured UK annuity contracts as held for sale | (12,002) | |
Premiums | 6,964 | |
Surrenders | (3,446) | |
Maturities/deaths | (3,499) | |
Net flows | 19 | |
Shareholders' transfers post-tax | (127) | |
Investment-related items and other movements | (801) | |
Foreign exchange translation differences | 17 | |
Ending Balance | 168,172 | |
Policyholder liabilities on the consolidated statement of financial position | 154,655 | |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 13,517 | |
Average policyholder liability balances | 161,122 | |
Continuing and discontinued operations | UK and Europe insurance operations | Operating segments after elimination, before unallocated | Shareholder-backed | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | £ 40,760 | 56,367 |
Reclassification of reinsured UK annuity contracts as held for sale | (12,002) | |
Premiums | 681 | |
Surrenders | (1,200) | |
Maturities/deaths | (1,294) | |
Net flows | (1,813) | |
Investment-related items and other movements | (236) | |
Ending Balance | 42,316 | |
Policyholder liabilities on the consolidated statement of financial position | £ 42,316 |
Policyholder liabilities and _4
Policyholder liabilities and unallocated surplus - Movement in insurance contract liabilities and unallocated surplus (Details) £ in Millions | 6 Months Ended |
Jun. 30, 2019GBP (£) | |
Insurance contract liabilities, gross and reinsurance share, and unallocated surplus of with-profits funds | |
Policyholder liabilities on the consolidated statement of financial position | £ 285,168 |
Removal of opening balances relating to the discontinued UK and Europe insurance operations | (13,334) |
Income and expense included in the income statement | 506 |
Other movements | (90) |
Foreign exchange translation differences | 17 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,944 |
Claims paid | 11,037 |
Contract liabilities (before reinsurers' share) | |
Insurance contract liabilities, gross and reinsurance share, and unallocated surplus of with-profits funds | |
Removal of opening balances relating to the discontinued UK and Europe insurance operations | (151,555) |
Income and expense included in the income statement | 26,274 |
Other movements | 41 |
Foreign exchange translation differences | 1,107 |
Policyholder liabilities on the consolidated statement of financial position | 285,168 |
Reinsurers' share | |
Insurance contract liabilities, gross and reinsurance share, and unallocated surplus of with-profits funds | |
Removal of opening balances relating to the discontinued UK and Europe insurance operations | 1,703 |
Income and expense included in the income statement | (680) |
Foreign exchange translation differences | (30) |
Policyholder liabilities on the consolidated statement of financial position | (10,151) |
Claims paid | (466) |
Reinsurers' share | With-profits | |
Insurance contract liabilities, gross and reinsurance share, and unallocated surplus of with-profits funds | |
Removal of opening balances relating to the discontinued UK and Europe insurance operations | 1,109 |
Continuing and discontinued operations | |
Insurance contract liabilities, gross and reinsurance share, and unallocated surplus of with-profits funds | |
Policyholder liabilities on the consolidated statement of financial position | 409,301 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 15,845 |
Continuing and discontinued operations | Contract liabilities (before reinsurers' share) | |
Insurance contract liabilities, gross and reinsurance share, and unallocated surplus of with-profits funds | |
Policyholder liabilities on the consolidated statement of financial position | 409,301 |
Continuing and discontinued operations | Reinsurers' share | |
Insurance contract liabilities, gross and reinsurance share, and unallocated surplus of with-profits funds | |
Policyholder liabilities on the consolidated statement of financial position | £ (11,144) |
Policyholder liabilities and _5
Policyholder liabilities and unallocated surplus - Analysis of movements, Asia (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | £ 285,168 | |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,944 | |
Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Premiums | 14,634 | |
Surrenders | (7,929) | |
Maturities/deaths | (2,337) | |
Net flows | 4,368 | |
Shareholders' transfers post-tax | (38) | |
Investment-related items and other movements | 22,980 | |
Foreign exchange translation differences | 1,076 | |
Ending Balance | 296,749 | |
Policyholder liabilities on the consolidated statement of financial position | 285,121 | |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,944 | |
Group's share of policyholder liabilities of joint ventures and associates | 8,684 | |
Shareholder-backed | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Premiums | 10,983 | |
Surrenders | (7,722) | |
Maturities/deaths | (1,787) | |
Net flows | 1,474 | |
Investment-related items and other movements | 18,461 | |
Foreign exchange translation differences | 740 | |
Ending Balance | 246,872 | |
Policyholder liabilities on the consolidated statement of financial position | 238,188 | |
Group's share of policyholder liabilities of joint ventures and associates | 8,684 | |
Asia insurance operations | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 82,763 | £ 73,839 |
Policyholder liabilities on the consolidated statement of financial position | 72,107 | 62,898 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,511 | 3,474 |
Group's share of policyholder liabilities of joint ventures and associates | 8,145 | 7,467 |
New business | 2,281 | 1,737 |
In-force | 5,293 | 4,510 |
Premiums | 7,574 | 6,247 |
Surrenders | (1,531) | (1,547) |
Maturities/deaths | (989) | (838) |
Net flows | 5,054 | 3,862 |
Shareholders' transfers post-tax | (38) | (27) |
Investment-related items and other movements | 6,142 | (1,349) |
Foreign exchange translation differences | 676 | 690 |
Ending Balance | 94,597 | 77,015 |
Policyholder liabilities on the consolidated statement of financial position | 82,969 | 65,640 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,944 | 3,766 |
Group's share of policyholder liabilities of joint ventures and associates | 8,684 | 7,609 |
Average policyholder liability balances | 85,953 | 71,807 |
Asia insurance operations | Deductions for intra-group reinsurance | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | 1,108 | 1,181 |
Asia insurance operations | Operating segments after deductions of intra-group reinsurance | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | 84,077 | 66,821 |
Asia insurance operations | With-profits | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 42,166 | 36,437 |
Policyholder liabilities on the consolidated statement of financial position | 39,655 | 32,963 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,511 | 3,474 |
New business | 594 | 432 |
In-force | 3,057 | 2,549 |
Premiums | 3,651 | 2,981 |
Surrenders | (207) | (164) |
Maturities/deaths | (550) | (418) |
Net flows | 2,894 | 2,399 |
Shareholders' transfers post-tax | (38) | (27) |
Investment-related items and other movements | 4,519 | (631) |
Foreign exchange translation differences | 336 | 689 |
Ending Balance | 49,877 | 38,867 |
Policyholder liabilities on the consolidated statement of financial position | 46,933 | 35,101 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,944 | 3,766 |
Average policyholder liability balances | 43,294 | 34,032 |
Asia insurance operations | With-profits | Deductions for intra-group reinsurance | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | 1,108 | 1,181 |
Asia insurance operations | With-profits | Operating segments after deductions of intra-group reinsurance | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | 84,077 | 66,821 |
Asia insurance operations | Unit-linked | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 20,182 | 20,027 |
Policyholder liabilities on the consolidated statement of financial position | 16,368 | 16,263 |
Group's share of policyholder liabilities of joint ventures and associates | 3,814 | 3,764 |
New business | 775 | 870 |
In-force | 932 | 841 |
Premiums | 1,707 | 1,711 |
Surrenders | (1,070) | (1,071) |
Maturities/deaths | (69) | (93) |
Net flows | 568 | 547 |
Investment-related items and other movements | 582 | (652) |
Foreign exchange translation differences | 172 | (142) |
Ending Balance | 21,504 | 19,780 |
Policyholder liabilities on the consolidated statement of financial position | 17,594 | 16,094 |
Group's share of policyholder liabilities of joint ventures and associates | 3,910 | 3,686 |
Average policyholder liability balances | 20,843 | 19,903 |
Asia insurance operations | Other business | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 20,415 | 17,375 |
Policyholder liabilities on the consolidated statement of financial position | 16,084 | 13,672 |
Group's share of policyholder liabilities of joint ventures and associates | 4,331 | 3,703 |
New business | 912 | 435 |
In-force | 1,304 | 1,120 |
Premiums | 2,216 | 1,555 |
Surrenders | (254) | (312) |
Maturities/deaths | (370) | (327) |
Net flows | 1,592 | 916 |
Investment-related items and other movements | 1,041 | (66) |
Foreign exchange translation differences | 168 | 143 |
Ending Balance | 23,216 | 18,368 |
Policyholder liabilities on the consolidated statement of financial position | 18,442 | 14,445 |
Group's share of policyholder liabilities of joint ventures and associates | 4,774 | 3,923 |
Average policyholder liability balances | 21,816 | £ 17,872 |
Asia insurance operations | Shareholder-backed | Operating segments after elimination, before unallocated | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Premiums | 3,923 | |
Surrenders | (1,324) | |
Maturities/deaths | (439) | |
Net flows | 2,160 | |
Investment-related items and other movements | 1,623 | |
Foreign exchange translation differences | 340 | |
Ending Balance | 44,720 | |
Policyholder liabilities on the consolidated statement of financial position | 36,036 | |
Group's share of policyholder liabilities of joint ventures and associates | £ 8,684 | |
Percentage rate of surrender | 3.30% | 3.70% |
Policyholder liabilities and _6
Policyholder liabilities and unallocated surplus - Analysis of movements, US (Details) £ in Millions | 6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
Jun. 30, 2019₫ / £ | Jun. 30, 2019₫ / £$ / £ | Jun. 30, 2019₫ / £฿ / £ | Jun. 30, 2019₫ / £$ / £ | Jun. 30, 2019₫ / £RM / £ | Jun. 30, 2019₫ / £₨ / £ | Jun. 30, 2019₫ / £Rp / £ | Jun. 30, 2019₫ / £$ / £ | Jun. 30, 2019₫ / £¥ / £ | Jun. 30, 2019GBP (£)₫ / £ | Jun. 30, 2018₫ / £ | Jun. 30, 2018₫ / £$ / £ | Jun. 30, 2018₫ / £฿ / £ | Jun. 30, 2018₫ / £$ / £ | Jun. 30, 2018₫ / £RM / £ | Jun. 30, 2018₫ / £₨ / £ | Jun. 30, 2018₫ / £Rp / £ | Jun. 30, 2018₫ / £$ / £ | Jun. 30, 2018₫ / £¥ / £ | Jun. 30, 2018GBP (£)₫ / £ | Jun. 30, 2019$ / £ | Jun. 30, 2019฿ / £ | Jun. 30, 2019$ / £ | Jun. 30, 2019RM / £ | Jun. 30, 2019₨ / £ | Jun. 30, 2019Rp / £ | Jun. 30, 2019$ / £ | Jun. 30, 2019¥ / £ | Jun. 30, 2019GBP (£) | Dec. 31, 2018₫ / £ | Dec. 31, 2018$ / £ | Dec. 31, 2018฿ / £ | Dec. 31, 2018$ / £ | Dec. 31, 2018RM / £ | Dec. 31, 2018₨ / £ | Dec. 31, 2018Rp / £ | Dec. 31, 2018$ / £ | Dec. 31, 2018¥ / £ | Jun. 30, 2018$ / £ | Jun. 30, 2018฿ / £ | Jun. 30, 2018$ / £ | Jun. 30, 2018RM / £ | Jun. 30, 2018₨ / £ | Jun. 30, 2018Rp / £ | Jun. 30, 2018$ / £ | Jun. 30, 2018¥ / £ | Jun. 30, 2018GBP (£) | |
Analysis of movements in policyholder liabilities and unallocated surplus | |||||||||||||||||||||||||||||||||||||||||||||||
Policyholder liabilities on the consolidated statement of financial position | £ 285,168 | ||||||||||||||||||||||||||||||||||||||||||||||
Average exchange rate | 30,087.11 | 1.29 | 40.91 | 1.76 | 5.33 | 90.62 | 18,364.05 | 10.15 | 8.78 | 31,329.01 | 1.38 | 43.66 | 1.83 | 5.42 | 90.37 | 18,938.64 | 10.78 | 8.76 | |||||||||||||||||||||||||||||
Closing exchange rate | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 29,660.27 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 30,310.96 | 1.27 | 39.06 | 1.72 | 5.26 | 87.85 | 17,980.07 | 9.94 | 8.74 | 29,541.15 | 1.27 | 41.47 | 1.74 | 5.26 | 88.92 | 18,314.37 | 9.97 | 8.74 | 1.32 | 43.74 | 1.80 | 5.33 | 90.46 | 18,919.18 | 10.36 | 8.75 | ||
Operating segments after elimination, before unallocated | |||||||||||||||||||||||||||||||||||||||||||||||
Analysis of movements in policyholder liabilities and unallocated surplus | |||||||||||||||||||||||||||||||||||||||||||||||
Premiums | £ 14,634 | ||||||||||||||||||||||||||||||||||||||||||||||
Surrenders | (7,929) | ||||||||||||||||||||||||||||||||||||||||||||||
Maturities/deaths | (2,337) | ||||||||||||||||||||||||||||||||||||||||||||||
Net flows | 4,368 | ||||||||||||||||||||||||||||||||||||||||||||||
Investment-related items and other movements | 22,980 | ||||||||||||||||||||||||||||||||||||||||||||||
Foreign exchange translation differences | 1,076 | ||||||||||||||||||||||||||||||||||||||||||||||
Policyholder liabilities on the consolidated statement of financial position | 285,121 | ||||||||||||||||||||||||||||||||||||||||||||||
Jackson (US insurance operations) | |||||||||||||||||||||||||||||||||||||||||||||||
Analysis of movements in policyholder liabilities and unallocated surplus | |||||||||||||||||||||||||||||||||||||||||||||||
Average exchange rate | $ / £ | 1.29 | 1.38 | |||||||||||||||||||||||||||||||||||||||||||||
Closing exchange rate | $ / £ | 1.27 | 1.27 | |||||||||||||||||||||||||||||||||||||||||||||
Jackson (US insurance operations) | Operating segments after elimination, before unallocated | |||||||||||||||||||||||||||||||||||||||||||||||
Analysis of movements in policyholder liabilities and unallocated surplus | |||||||||||||||||||||||||||||||||||||||||||||||
Policyholder liabilities on the consolidated statement of financial position | 185,600 | £ 180,724 | |||||||||||||||||||||||||||||||||||||||||||||
Premiums | 7,060 | 7,111 | |||||||||||||||||||||||||||||||||||||||||||||
Surrenders | (6,398) | (5,953) | |||||||||||||||||||||||||||||||||||||||||||||
Maturities/deaths | (1,348) | (1,076) | |||||||||||||||||||||||||||||||||||||||||||||
Net flows | (686) | 82 | |||||||||||||||||||||||||||||||||||||||||||||
Investment-related items and other movements | 16,838 | (103) | |||||||||||||||||||||||||||||||||||||||||||||
Foreign exchange translation differences | 400 | 4,447 | |||||||||||||||||||||||||||||||||||||||||||||
Policyholder liabilities on the consolidated statement of financial position | 202,152 | 185,150 | |||||||||||||||||||||||||||||||||||||||||||||
Average policyholder liability balances | £ 193,876 | £ 182,937 | |||||||||||||||||||||||||||||||||||||||||||||
Jackson (US insurance operations) | Operating segments after elimination, before unallocated | Variable annuity separate account | |||||||||||||||||||||||||||||||||||||||||||||||
Analysis of movements in policyholder liabilities and unallocated surplus | |||||||||||||||||||||||||||||||||||||||||||||||
Policyholder liabilities on the consolidated statement of financial position | 128,220 | 130,528 | |||||||||||||||||||||||||||||||||||||||||||||
Premiums | 4,661 | 5,528 | |||||||||||||||||||||||||||||||||||||||||||||
Surrenders | (4,643) | (4,225) | |||||||||||||||||||||||||||||||||||||||||||||
Maturities/deaths | (604) | (540) | |||||||||||||||||||||||||||||||||||||||||||||
Net flows | (586) | 763 | |||||||||||||||||||||||||||||||||||||||||||||
Transfers from general to separate account | 492 | 387 | |||||||||||||||||||||||||||||||||||||||||||||
Investment-related items and other movements | 16,800 | 582 | |||||||||||||||||||||||||||||||||||||||||||||
Foreign exchange translation differences | 369 | 3,286 | |||||||||||||||||||||||||||||||||||||||||||||
Policyholder liabilities on the consolidated statement of financial position | 145,295 | 135,546 | |||||||||||||||||||||||||||||||||||||||||||||
Average policyholder liability balances | 136,757 | 133,037 | |||||||||||||||||||||||||||||||||||||||||||||
Jackson (US insurance operations) | Operating segments after elimination, before unallocated | Fixed annuity, GICs and other | |||||||||||||||||||||||||||||||||||||||||||||||
Analysis of movements in policyholder liabilities and unallocated surplus | |||||||||||||||||||||||||||||||||||||||||||||||
Policyholder liabilities on the consolidated statement of financial position | 57,380 | 50,196 | |||||||||||||||||||||||||||||||||||||||||||||
Premiums | 2,399 | 1,583 | |||||||||||||||||||||||||||||||||||||||||||||
Surrenders | (1,755) | (1,728) | |||||||||||||||||||||||||||||||||||||||||||||
Maturities/deaths | (744) | (536) | |||||||||||||||||||||||||||||||||||||||||||||
Net flows | (100) | (681) | |||||||||||||||||||||||||||||||||||||||||||||
Transfers from general to separate account | (492) | (387) | |||||||||||||||||||||||||||||||||||||||||||||
Investment-related items and other movements | 38 | (685) | |||||||||||||||||||||||||||||||||||||||||||||
Foreign exchange translation differences | 31 | 1,161 | |||||||||||||||||||||||||||||||||||||||||||||
Policyholder liabilities on the consolidated statement of financial position | £ 56,857 | £ 49,604 | |||||||||||||||||||||||||||||||||||||||||||||
Average policyholder liability balances | £ 57,119 | £ 49,900 |
Intangible assets - Goodwill re
Intangible assets - Goodwill reconciliation (Details) - GBP (£) £ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Changes in goodwill: | ||
Reclassification to held for distribution | £ (1,359) | |
Exchange differences | 12 | |
Carrying value at end of period | 510 | |
Continuing and discontinued operations | ||
Changes in goodwill: | ||
Carrying value at beginning of period | £ 1,857 | £ 1,482 |
Additions in the period | 376 | |
Disposals/reclassifications to held for sale | (10) | |
Exchange differences | 9 | |
Carrying value at end of period | £ 1,857 |
Intangible assets - Deferred ac
Intangible assets - Deferred acquisition costs and other intangible assets (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred acquisition costs and other intangible assets | |||
Total of deferred acquisition costs and other intangible assets | £ 12,659 | ||
UK & Europe Operations (M&G Prudential) | |||
Deferred acquisition costs and other intangible assets | |||
Total of deferred acquisition costs and other intangible assets | 174 | £ 195 | |
Continuing and discontinued operations | |||
Deferred acquisition costs and other intangible assets | |||
Total of deferred acquisition costs and other intangible assets | 11,923 | ||
Shareholder-backed | |||
Deferred acquisition costs and other intangible assets | |||
Deferred acquisition costs | 10,353 | ||
Intangible assets other than goodwill | 2,248 | ||
Total of deferred acquisition costs and other intangible assets | 12,601 | 11,672 | |
Shareholder-backed | UK & Europe Operations (M&G Prudential) | |||
Deferred acquisition costs and other intangible assets | |||
Total of deferred acquisition costs and other intangible assets | 112 | ||
Shareholder-backed | Continuing and discontinued operations | |||
Deferred acquisition costs and other intangible assets | |||
Deferred acquisition costs | 10,095 | ||
Intangible assets other than goodwill | 1,689 | ||
Total of deferred acquisition costs and other intangible assets | 12,601 | 11,784 | £ 10,866 |
Shareholder-backed | PVIF | |||
Deferred acquisition costs and other intangible assets | |||
Intangible assets other than goodwill | 31 | ||
Shareholder-backed | PVIF | Continuing and discontinued operations | |||
Deferred acquisition costs and other intangible assets | |||
Intangible assets other than goodwill | 34 | ||
Shareholder-backed | Distribution rights and other intangible assets | |||
Deferred acquisition costs and other intangible assets | |||
Intangible assets other than goodwill | 2,217 | ||
Shareholder-backed | Distribution rights and other intangible assets | Continuing and discontinued operations | |||
Deferred acquisition costs and other intangible assets | |||
Intangible assets other than goodwill | 1,655 | ||
Shareholder-backed | Insurance contracts | |||
Deferred acquisition costs and other intangible assets | |||
Deferred acquisition costs | 10,326 | ||
Shareholder-backed | Insurance contracts | Continuing and discontinued operations | |||
Deferred acquisition costs and other intangible assets | |||
Deferred acquisition costs | 10,017 | ||
Shareholder-backed | Investment contracts | |||
Deferred acquisition costs and other intangible assets | |||
Deferred acquisition costs | 27 | ||
Shareholder-backed | Investment contracts | Continuing and discontinued operations | |||
Deferred acquisition costs and other intangible assets | |||
Deferred acquisition costs | 78 | ||
With-profits | |||
Deferred acquisition costs and other intangible assets | |||
Total of deferred acquisition costs and other intangible assets | 58 | 56 | |
With-profits | UK & Europe Operations (M&G Prudential) | |||
Deferred acquisition costs and other intangible assets | |||
Total of deferred acquisition costs and other intangible assets | 83 | ||
With-profits | Continuing and discontinued operations | |||
Deferred acquisition costs and other intangible assets | |||
Total of deferred acquisition costs and other intangible assets | £ 58 | £ 139 |
Intangible assets - Changes in
Intangible assets - Changes in DAC and other intangibles (Details) £ in Millions | Jan. 31, 2019GBP (£)$ / £installment | Jan. 31, 2019GBP (£) | Jun. 30, 2019GBP (£) | Jun. 30, 2019GBP (£)₫ / £ | Jun. 30, 2019GBP (£)$ / £ | Jun. 30, 2019GBP (£)฿ / £ | Jun. 30, 2019GBP (£)$ / £ | Jun. 30, 2019GBP (£)RM / £ | Jun. 30, 2019GBP (£)₨ / £ | Jun. 30, 2019GBP (£)Rp / £ | Jun. 30, 2019GBP (£)$ / £ | Jun. 30, 2019GBP (£)¥ / £ | Jun. 30, 2019GBP (£) | Jun. 30, 2018₫ / £ | Jun. 30, 2018$ / £ | Jun. 30, 2018฿ / £ | Jun. 30, 2018$ / £ | Jun. 30, 2018RM / £ | Jun. 30, 2018₨ / £ | Jun. 30, 2018Rp / £ | Jun. 30, 2018$ / £ | Jun. 30, 2018¥ / £ | Dec. 31, 2018GBP (£) |
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
At end of year | £ 12,659 | ||||||||||||||||||||||
PVIF and other intangibles | |||||||||||||||||||||||
Foreign exchange rate | 30,087.11 | 1.29 | 40.91 | 1.76 | 5.33 | 90.62 | 18,364.05 | 10.15 | 8.78 | 31,329.01 | 1.38 | 43.66 | 1.83 | 5.42 | 90.37 | 18,938.64 | 10.78 | 8.76 | |||||
United Overseas Bank Limited | |||||||||||||||||||||||
PVIF and other intangibles | |||||||||||||||||||||||
Additions | £ 630 | ||||||||||||||||||||||
Initial fee payable | £ 662 | 662 | |||||||||||||||||||||
Foreign exchange rate | $ / £ | 1.7360 | ||||||||||||||||||||||
Number of instalments | installment | 3 | ||||||||||||||||||||||
Initial fee payable in February 2019 | £ 230 | 230 | |||||||||||||||||||||
Initial fee payable in January 2020 | 331 | 331 | |||||||||||||||||||||
Initial fee payable in January 2021 | £ 101 | 101 | |||||||||||||||||||||
Jackson (US insurance operations) | |||||||||||||||||||||||
PVIF and other intangibles | |||||||||||||||||||||||
Foreign exchange rate | $ / £ | 1.29 | 1.38 | |||||||||||||||||||||
Continuing and discontinued operations | |||||||||||||||||||||||
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
At beginning of year | 11,923 | 11,923 | |||||||||||||||||||||
At end of year | £ 11,923 | ||||||||||||||||||||||
Shareholder-backed | |||||||||||||||||||||||
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
At beginning of year | 11,672 | 11,672 | |||||||||||||||||||||
Additions | 1,135 | ||||||||||||||||||||||
Amortisation to the income statement | 189 | ||||||||||||||||||||||
Amortisation to the income statement, operating | (287) | ||||||||||||||||||||||
Amortisation to the income statement, non-operating | 476 | ||||||||||||||||||||||
Disposals and transfers | (5) | ||||||||||||||||||||||
Exchange differences and other movements | 42 | ||||||||||||||||||||||
Amortisation of DAC related to net unrealised valuation movements on the US insurance operation's available-for-sale securities recognised within other comprehensive income | (432) | ||||||||||||||||||||||
At end of year | 12,601 | £ 11,672 | |||||||||||||||||||||
Assumption for long-term investment returns (as a percent) | 7.40% | ||||||||||||||||||||||
PVIF and other intangibles | |||||||||||||||||||||||
Intangible assets | £ 2,248 | £ 2,248 | £ 2,248 | £ 2,248 | £ 2,248 | £ 2,248 | £ 2,248 | £ 2,248 | £ 2,248 | £ 2,248 | 2,248 | ||||||||||||
Shareholder-backed | PVIF and other intangibles | |||||||||||||||||||||||
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
Additions | 652 | ||||||||||||||||||||||
Amortisation to the income statement | (102) | ||||||||||||||||||||||
Amortisation to the income statement, operating | (102) | ||||||||||||||||||||||
Disposals and transfers | (5) | ||||||||||||||||||||||
Exchange differences and other movements | 22 | ||||||||||||||||||||||
At end of year | 2,248 | ||||||||||||||||||||||
Shareholder-backed | Software | |||||||||||||||||||||||
PVIF and other intangibles | |||||||||||||||||||||||
Amounts reclassified as held for distribution | (6) | ||||||||||||||||||||||
Additions | 16 | ||||||||||||||||||||||
Amortisation | 15 | ||||||||||||||||||||||
Disposals | 2 | ||||||||||||||||||||||
Intangible assets | £ 55 | £ 55 | £ 55 | £ 55 | £ 55 | £ 55 | £ 55 | £ 55 | £ 55 | £ 55 | 55 | ||||||||||||
Shareholder-backed | Asia insurance operations | Deferred acquisition costs | |||||||||||||||||||||||
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
Additions | 198 | ||||||||||||||||||||||
Amortisation to the income statement | (91) | ||||||||||||||||||||||
Amortisation to the income statement, operating | (91) | ||||||||||||||||||||||
Exchange differences and other movements | 12 | ||||||||||||||||||||||
At end of year | 1,383 | ||||||||||||||||||||||
Shareholder-backed | Jackson (US insurance operations) | |||||||||||||||||||||||
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
Assumption for long-term investment returns (as a percent) | 7.40% | 7.40% | |||||||||||||||||||||
Shareholder-backed | Jackson (US insurance operations) | Deferred acquisition costs | |||||||||||||||||||||||
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
Additions | 285 | ||||||||||||||||||||||
Amortisation to the income statement | 382 | ||||||||||||||||||||||
Amortisation to the income statement, operating | (94) | ||||||||||||||||||||||
Amortisation to the income statement, non-operating | 476 | ||||||||||||||||||||||
Exchange differences and other movements | 8 | ||||||||||||||||||||||
Amortisation of DAC related to net unrealised valuation movements on the US insurance operation's available-for-sale securities recognised within other comprehensive income | (432) | ||||||||||||||||||||||
At end of year | 8,970 | ||||||||||||||||||||||
Shareholder-backed | Continuing and discontinued operations | |||||||||||||||||||||||
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
At beginning of year | 11,784 | 11,784 | £ 10,866 | ||||||||||||||||||||
Reclassification to held for distribution | (112) | ||||||||||||||||||||||
Additions | 1,248 | ||||||||||||||||||||||
Amortisation to the income statement | (1,142) | ||||||||||||||||||||||
Amortisation to the income statement, operating | (1,024) | ||||||||||||||||||||||
Amortisation to the income statement, non-operating | (118) | ||||||||||||||||||||||
Disposals and transfers | (14) | ||||||||||||||||||||||
Exchange differences and other movements | 580 | ||||||||||||||||||||||
Amortisation of DAC related to net unrealised valuation movements on the US insurance operation's available-for-sale securities recognised within other comprehensive income | 246 | ||||||||||||||||||||||
At end of year | 12,601 | 11,784 | |||||||||||||||||||||
PVIF and other intangibles | |||||||||||||||||||||||
Intangible assets | 1,689 | ||||||||||||||||||||||
Shareholder-backed | Continuing and discontinued operations | PVIF and other intangibles | |||||||||||||||||||||||
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
At beginning of year | 1,689 | 1,689 | |||||||||||||||||||||
Reclassification to held for distribution | (8) | ||||||||||||||||||||||
At end of year | 1,689 | ||||||||||||||||||||||
Shareholder-backed | Continuing and discontinued operations | Asia insurance operations | Deferred acquisition costs | |||||||||||||||||||||||
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
At beginning of year | 1,264 | 1,264 | |||||||||||||||||||||
At end of year | 1,264 | ||||||||||||||||||||||
Shareholder-backed | Continuing and discontinued operations | Jackson (US insurance operations) | Deferred acquisition costs | |||||||||||||||||||||||
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
At beginning of year | 8,727 | 8,727 | |||||||||||||||||||||
At end of year | 8,727 | ||||||||||||||||||||||
Shareholder-backed | Continuing and discontinued operations | UK and Europe insurance operations | Deferred acquisition costs | |||||||||||||||||||||||
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
At beginning of year | 86 | 86 | |||||||||||||||||||||
Reclassification to held for distribution | (86) | ||||||||||||||||||||||
At end of year | 86 | ||||||||||||||||||||||
Shareholder-backed | Continuing and discontinued operations | Asset management operations | Deferred acquisition costs | |||||||||||||||||||||||
Movements in deferred acquisition costs and intangible assets | |||||||||||||||||||||||
At beginning of year | £ 18 | 18 | |||||||||||||||||||||
Reclassification to held for distribution | £ (18) | ||||||||||||||||||||||
At end of year | £ 18 |
Intangible Assets - DAC for US
Intangible Assets - DAC for US operations and sensitivity of amortisation (Details) - GBP (£) £ in Millions | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
DAC amounts | |||
Gain (loss) for shadow DAC amortisation | £ (432) | £ 272 | |
Shareholder-backed | |||
DAC amounts | |||
Deferred acquisition costs | 10,353 | ||
Credit (charge) for decelerated (accelerated) amortisation | £ 148 | £ (42) | |
Assumptions for amortisation of deferred acquisition costs - period for projected level of investment return | 5 years | ||
Assumptions for amortisation of deferred acquisition costs - preceding period of actual investment return | 3 years | ||
Assumption for long-term investment returns (as a percent) | 7.40% | ||
Assumptions for amortisation of deferred acquisition costs - investment return realisation period | 8 years | ||
Maximum decrease in separate account values for mean reversion assumption to remain within the corridor (as a percent) | 35.00% | ||
Maximum increase in separate account values for mean reversion assumption to remain within the corridor (as a percent) | 30.00% | ||
Shareholder-backed | Continuing and discontinued operations | |||
DAC amounts | |||
Deferred acquisition costs | £ 10,095 | ||
Shareholder-backed | Jackson (US insurance operations) | |||
DAC amounts | |||
Deferred acquisition costs | £ 8,970 | ||
Gain (loss) for shadow DAC amortisation | (432) | 246 | |
Positive (negative) unrealised valuation movement | £ 2,617 | £ (1,617) | |
Assumption for long-term investment returns (as a percent) | 7.40% | 7.40% | |
Shareholder-backed | Jackson (US insurance operations) | Continuing and discontinued operations | |||
DAC amounts | |||
Deferred acquisition costs | £ 8,727 | ||
Shareholder-backed | Jackson (US insurance operations) | Cumulative shadow DAC | |||
DAC amounts | |||
Deferred acquisition costs | £ (489) | ||
Shareholder-backed | Jackson (US insurance operations) | Cumulative shadow DAC | Continuing and discontinued operations | |||
DAC amounts | |||
Deferred acquisition costs | (49) | ||
Shareholder-backed | Jackson (US insurance operations) | Variable annuities | Amount before cumulative shadow DAC | |||
DAC amounts | |||
Deferred acquisition costs | 9,118 | ||
Shareholder-backed | Jackson (US insurance operations) | Variable annuities | Amount before cumulative shadow DAC | Continuing and discontinued operations | |||
DAC amounts | |||
Deferred acquisition costs | 8,477 | ||
Shareholder-backed | Jackson (US insurance operations) | Other business | Amount before cumulative shadow DAC | |||
DAC amounts | |||
Deferred acquisition costs | £ 341 | ||
Shareholder-backed | Jackson (US insurance operations) | Other business | Amount before cumulative shadow DAC | Continuing and discontinued operations | |||
DAC amounts | |||
Deferred acquisition costs | £ 299 |
Borrowings - Core Structural Bo
Borrowings - Core Structural Borrowings (Details) € in Millions, £ in Millions, $ in Millions | Jun. 30, 2019GBP (£) | May 31, 2019GBP (£) | Jun. 30, 2019GBP (£) | Jun. 30, 2018GBP (£) | Dec. 31, 2018EUR (€) | Jul. 31, 2019GBP (£) | Jun. 30, 2019EUR (€) | Jun. 30, 2019USD ($) | Jun. 30, 2019GBP (£) | Dec. 31, 2018USD ($) | Dec. 31, 2018GBP (£) | Dec. 31, 2017GBP (£) |
Borrowings | ||||||||||||
Upfront fees | £ 141 | |||||||||||
Interest charge | (226) | £ (189) | ||||||||||
Debt to be transferred | £ 3,200 | |||||||||||
Debt to be transferred, held at period end | 2,900 | |||||||||||
Debt to be transferred, raised after period end | £ 300 | |||||||||||
Coupon of debt to be transferred, raised after period end | 3.875% | |||||||||||
Core structural borrowings of shareholder-financed businesses | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 6,367 | 7,441 | £ 7,664 | £ 6,280 | ||||||||
Redemption of debt | £ 400 | |||||||||||
Core structural borrowings of shareholder-financed businesses | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 7,664 | |||||||||||
Holding company | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 7,245 | |||||||||||
Holding company | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 7,468 | |||||||||||
Debt before amounts capable of being substituted to M&GPrudential | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 4,156 | |||||||||||
Annualised interest of debt | £ (234) | |||||||||||
Debt before amounts capable of being substituted to M&GPrudential | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 4,549 | |||||||||||
Subordinated debt | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 3,362 | |||||||||||
Subordinated debt | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 3,757 | |||||||||||
Subordinated debt | Net investment hedge | ||||||||||||
Borrowings | ||||||||||||
Notional amount | $ | $ 3,725 | $ 3,725 | ||||||||||
Perpetual subordinated Capital Securities (Tier 1) | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 432 | |||||||||||
Perpetual subordinated Capital Securities (Tier 1) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 431 | |||||||||||
US$250m 6.75% Notes (Tier 1) | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 196 | |||||||||||
Notional amount | $ | $ 250 | $ 250 | ||||||||||
Interest rate (as a percent) | 6.75% | 6.75% | 6.75% | 6.75% | 6.75% | 6.75% | ||||||
US$250m 6.75% Notes (Tier 1) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 196 | |||||||||||
US$300m 6.5% Notes (Tier 1) | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 236 | |||||||||||
Notional amount | $ | $ 300 | $ 300 | ||||||||||
Interest rate (as a percent) | 6.50% | 6.50% | 6.50% | 6.50% | 6.50% | 6.50% | ||||||
US$300m 6.5% Notes (Tier 1) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 235 | |||||||||||
US$550m 7.75% Notes (Tier 1) | ||||||||||||
Borrowings | ||||||||||||
Notional amount | $ | $ 550 | $ 550 | ||||||||||
Interest rate (as a percent) | 7.75% | 7.75% | 7.75% | 7.75% | 7.75% | 7.75% | ||||||
Perpetual subordinated Capital Securities (Tier 2) | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 2,481 | |||||||||||
Perpetual subordinated Capital Securities (Tier 2) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 2,478 | |||||||||||
US$700m 5.25% Notes (Tier 2) | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 550 | |||||||||||
Notional amount | $ | $ 700 | $ 700 | ||||||||||
Interest rate (as a percent) | 5.25% | 5.25% | 5.25% | 5.25% | 5.25% | 5.25% | ||||||
US$700m 5.25% Notes (Tier 2) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 550 | |||||||||||
US$1,000m 5.25% Notes (Tier 2) | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 781 | |||||||||||
Notional amount | $ | $ 1,000 | $ 1,000 | ||||||||||
Interest rate (as a percent) | 5.25% | 5.25% | 5.25% | 5.25% | 5.25% | 5.25% | ||||||
US$1,000m 5.25% Notes (Tier 2) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 780 | |||||||||||
US$725m 4.375% Notes (Tier 2) | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 566 | |||||||||||
Notional amount | $ | $ 725 | $ 725 | ||||||||||
Interest rate (as a percent) | 4.375% | 4.375% | 4.375% | 4.375% | 4.375% | 4.375% | ||||||
US$725m 4.375% Notes (Tier 2) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 565 | |||||||||||
US$750m 4.875% Notes (Tier 2) | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 584 | |||||||||||
Notional amount | $ | $ 750 | $ 750 | ||||||||||
Interest rate (as a percent) | 4.875% | 4.875% | 4.875% | 4.875% | 4.875% | 4.875% | ||||||
US$750m 4.875% Notes (Tier 2) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 583 | |||||||||||
Subordinated Notes | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 449 | |||||||||||
Subordinated Notes | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 848 | |||||||||||
20m Medium Term Notes 2023 (Tier 2) | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 18 | |||||||||||
Notional amount | € | € 20 | € 20 | ||||||||||
20m Medium Term Notes 2023 (Tier 2) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 18 | |||||||||||
435m 6.125% Notes 2031 (Tier 2) | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 431 | |||||||||||
Notional amount | £ 435 | £ 435 | ||||||||||
Interest rate (as a percent) | 6.125% | 6.125% | 6.125% | 6.125% | 6.125% | 6.125% | ||||||
435m 6.125% Notes 2031 (Tier 2) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 431 | |||||||||||
400m 11.375% Notes 2039 (Tier 2) | ||||||||||||
Borrowings | ||||||||||||
Notional amount | £ 400 | £ 400 | ||||||||||
Redemption of debt | £ 400 | |||||||||||
Interest rate (as a percent) | 11.375% | 11.375% | 11.375% | 11.375% | 11.375% | 11.375% | ||||||
400m 11.375% Notes 2039 (Tier 2) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 399 | |||||||||||
Senior debt: 300m 6.875% Bonds 2023 | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 295 | |||||||||||
Notional amount | £ 300 | £ 300 | ||||||||||
Interest rate (as a percent) | 6.875% | 6.875% | 6.875% | 6.875% | 6.875% | 6.875% | ||||||
Senior debt: 300m 6.875% Bonds 2023 | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 294 | |||||||||||
Senior debt: 250m 5.875% Bonds 2029 | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 224 | |||||||||||
Notional amount | £ 250 | £ 250 | ||||||||||
Interest rate (as a percent) | 5.875% | 5.875% | 5.875% | 5.875% | 5.875% | 5.875% | ||||||
Senior debt: 250m 5.875% Bonds 2029 | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 223 | |||||||||||
Bank loan | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 275 | |||||||||||
Notional amount | £ 275 | £ 275 | ||||||||||
Interest rate basis | 12-month GBP LIBOR | 12-month GBP LIBOR | ||||||||||
Adjustment to interest rate basis (as a percent) | 0.33% | 0.33% | 0.33% | 0.33% | 0.33% | 0.33% | ||||||
Bank loan | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 275 | |||||||||||
Subordinated debt capable of being substituted to M&GPrudential as at 30 Jun 2019 | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 3,089 | |||||||||||
Interest charge | £ (85) | £ (35) | ||||||||||
Subordinated debt capable of being substituted to M&GPrudential as at 30 Jun 2019 | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 2,919 | |||||||||||
600m 5.56% (30 Jun and 31 Dec 2018: 5.0%) Notes 2055 (Tier 2) and 700m 6.34% (30 Jun and 31 Dec 2018: 5.7%) Notes 2063 (Tier 2) | ||||||||||||
Borrowings | ||||||||||||
Upfront fees | £ 141 | |||||||||||
600m 5.56% (30 Jun and 31 Dec 2018: 5.0%) Notes 2055 (Tier 2) | ||||||||||||
Borrowings | ||||||||||||
Borrowings | 642 | |||||||||||
Notional amount | £ 600 | £ 600 | ||||||||||
Interest rate (as a percent) | 5.00% | 5.56% | 5.56% | 5.56% | 5.00% | 5.00% | ||||||
600m 5.56% (30 Jun and 31 Dec 2018: 5.0%) Notes 2055 (Tier 2) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 591 | |||||||||||
700m 6.34% (30 Jun and 31 Dec 2018: 5.7%) Notes 2063 (Tier 2) | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 814 | |||||||||||
Notional amount | £ 700 | £ 700 | ||||||||||
Interest rate (as a percent) | 5.70% | 6.34% | 6.34% | 6.34% | 5.70% | 5.70% | ||||||
700m 6.34% (30 Jun and 31 Dec 2018: 5.7%) Notes 2063 (Tier 2) | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 696 | |||||||||||
750 million 5.625 per cent tier 2 bonds due 2051 | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 744 | |||||||||||
Notional amount | £ 750 | £ 750 | ||||||||||
Interest rate (as a percent) | 5.625% | 5.625% | 5.625% | 5.625% | 5.625% | 5.625% | ||||||
750 million 5.625 per cent tier 2 bonds due 2051 | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 743 | |||||||||||
500 million 6.25 per cent tier 2 bonds due 2068 | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 498 | |||||||||||
Notional amount | £ 500 | £ 500 | ||||||||||
Interest rate (as a percent) | 6.25% | 6.25% | 6.25% | 6.25% | 6.25% | 6.25% | ||||||
500 million 6.25 per cent tier 2 bonds due 2068 | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 498 | |||||||||||
US$500 million 6.5 per cent tier 2 bonds due 2048 | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 391 | |||||||||||
Notional amount | $ | $ 500 | $ 500 | ||||||||||
Interest rate (as a percent) | 6.50% | 6.50% | 6.50% | 6.50% | 6.50% | 6.50% | ||||||
US$500 million 6.5 per cent tier 2 bonds due 2048 | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 391 | |||||||||||
Jackson US$250m 8.15% Surplus Notes 2027 | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 196 | |||||||||||
Notional amount | $ | $ 250 | $ 250 | ||||||||||
Interest rate (as a percent) | 8.15% | 8.15% | 8.15% | 8.15% | 8.15% | 8.15% | ||||||
Jackson US$250m 8.15% Surplus Notes 2027 | Continuing and discontinued operations | ||||||||||||
Borrowings | ||||||||||||
Borrowings | £ 196 |
Borrowings - Operational borrow
Borrowings - Operational borrowings (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Operational borrowings attributable to shareholder-financed businesses | ||
Borrowings | ||
Borrowings | £ 1,664 | £ 892 |
Operational borrowings attributable to shareholder-financed businesses | Continuing and discontinued operations | ||
Borrowings | ||
Borrowings | 998 | |
Operational borrowings attributable to shareholder-financed businesses | UK & Europe Operations (M&G Prudential) | ||
Borrowings | ||
Borrowings | 106 | |
Borrowings in respect of short-term fixed income securities programmes | ||
Borrowings | ||
Borrowings | 661 | |
Borrowings in respect of short-term fixed income securities programmes | Continuing and discontinued operations | ||
Borrowings | ||
Borrowings | 472 | |
Lease liability for operating leases | ||
Borrowings | ||
Borrowings | 229 | |
Non-recourse borrowings of consolidated investment fund | ||
Borrowings | ||
Borrowings | 545 | |
Non-recourse borrowings of consolidated investment fund | Continuing and discontinued operations | ||
Borrowings | ||
Borrowings | 263 | |
Other borrowings | ||
Borrowings | ||
Borrowings | £ 229 | |
Other borrowings | Continuing and discontinued operations | ||
Borrowings | ||
Borrowings | £ 263 |
Borrowings - With-profits busin
Borrowings - With-profits businesses (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Borrowings attributable to with-profits businesses | ||
Borrowings | ||
Borrowings | £ 238 | £ 19 |
Borrowings attributable to with-profits businesses | Continuing and discontinued operations | ||
Borrowings | ||
Borrowings | 3,940 | |
Borrowings attributable to with-profits businesses | UK & Europe Operations (M&G Prudential) | ||
Borrowings | ||
Borrowings | 3,921 | |
Non-recourse borrowings of consolidated investment funds | Continuing and discontinued operations | ||
Borrowings | ||
Borrowings | 3,845 | |
Other borrowings (predominantly obligations under leases) | ||
Borrowings | ||
Borrowings | 238 | |
Other borrowings (predominantly obligations under leases) | Continuing and discontinued operations | ||
Borrowings | ||
Borrowings | £ 95 | |
Lease liability | ||
Borrowings | ||
Borrowings | £ 213 |
Deferred Tax (Details)
Deferred Tax (Details) £ in Millions | 6 Months Ended |
Jun. 30, 2019GBP (£) | |
Deferred tax assets in statement of financial position | |
Reclassification as held for distribution | £ (126) |
Movement in income statement | 386 |
Movement through other comprehensive income and equity | (1) |
Other movements including foreign currency movements | (92) |
Deferred tax assets at the end of the period | 2,762 |
Deferred tax liabilities in statement of financial position | |
Reclassification as held for distribution | 1,061 |
Movement in income statement | (368) |
Movement through other comprehensive income and equity | (443) |
Other movements including foreign currency movements | 71 |
Deferred tax liabilities at the end of the period | (3,701) |
Continuing and discontinued operations | |
Deferred tax assets in statement of financial position | |
Deferred tax assets at the beginning of the period | 2,595 |
Deferred tax liabilities in statement of financial position | |
Deferred tax liabilities at the beginning of the period | (4,022) |
Unrealised gains and losses on investments | |
Deferred tax assets in statement of financial position | |
Movement in income statement | (13) |
Other movements including foreign currency movements | (97) |
Deferred tax assets at the end of the period | 3 |
Deferred tax liabilities in statement of financial position | |
Reclassification as held for distribution | 827 |
Movement in income statement | (40) |
Movement through other comprehensive income and equity | (459) |
Other movements including foreign currency movements | 74 |
Deferred tax liabilities at the end of the period | (465) |
Unrealised gains and losses on investments | Continuing and discontinued operations | |
Deferred tax assets in statement of financial position | |
Deferred tax assets at the beginning of the period | 113 |
Deferred tax liabilities in statement of financial position | |
Deferred tax liabilities at the beginning of the period | (867) |
Balances relating to investment and insurance contracts | |
Deferred tax assets in statement of financial position | |
Deferred tax assets at the end of the period | 1 |
Deferred tax liabilities in statement of financial position | |
Movement in income statement | (189) |
Other movements including foreign currency movements | 2 |
Deferred tax liabilities at the end of the period | (1,189) |
Balances relating to investment and insurance contracts | Continuing and discontinued operations | |
Deferred tax assets in statement of financial position | |
Deferred tax assets at the beginning of the period | 1 |
Deferred tax liabilities in statement of financial position | |
Deferred tax liabilities at the beginning of the period | (1,002) |
Short-term temporary differences | |
Deferred tax assets in statement of financial position | |
Reclassification as held for distribution | (115) |
Movement in income statement | 392 |
Movement through other comprehensive income and equity | (1) |
Other movements including foreign currency movements | 5 |
Deferred tax assets at the end of the period | 2,620 |
Deferred tax liabilities in statement of financial position | |
Reclassification as held for distribution | 183 |
Movement in income statement | (139) |
Movement through other comprehensive income and equity | 16 |
Other movements including foreign currency movements | (5) |
Deferred tax liabilities at the end of the period | (2,042) |
Short-term temporary differences | Continuing and discontinued operations | |
Deferred tax assets in statement of financial position | |
Deferred tax assets at the beginning of the period | 2,339 |
Deferred tax liabilities in statement of financial position | |
Deferred tax liabilities at the beginning of the period | (2,097) |
Capital allowances | |
Deferred tax assets in statement of financial position | |
Reclassification as held for distribution | (11) |
Movement in income statement | (1) |
Deferred tax assets at the end of the period | 3 |
Deferred tax liabilities in statement of financial position | |
Reclassification as held for distribution | 51 |
Deferred tax liabilities at the end of the period | (5) |
Capital allowances | Continuing and discontinued operations | |
Deferred tax assets in statement of financial position | |
Deferred tax assets at the beginning of the period | 15 |
Deferred tax liabilities in statement of financial position | |
Deferred tax liabilities at the beginning of the period | (56) |
Unused tax losses | |
Deferred tax assets in statement of financial position | |
Movement in income statement | 8 |
Deferred tax assets at the end of the period | 135 |
Unused tax losses | Continuing and discontinued operations | |
Deferred tax assets in statement of financial position | |
Deferred tax assets at the beginning of the period | £ 127 |
Defined benefit pension schem_2
Defined benefit pension schemes - Background (Details) £ in Millions | 6 Months Ended | |
Jun. 30, 2019GBP (£)item | Jun. 29, 2019 | |
UK defined benefit schemes | ||
Defined benefit pension schemes | ||
Net defined benefit liability (asset) | £ | £ 69 | |
PSPS | ||
Defined benefit pension schemes | ||
Percentage of underlying Group's defined benefit schemes | 30.00% | |
PSPS | M&G Prudential Service Company Limited | ||
Defined benefit pension schemes | ||
Percentage of underlying Group's defined benefit schemes | 30.00% | |
Smaller UK defined benefit schemes | ||
Defined benefit pension schemes | ||
Number of plans | 2 | |
Other schemes | Taiwan | ||
Defined benefit pension schemes | ||
Number of plans | 2 |
Share capital, share premium _3
Share capital, share premium and own shares - Share capital and premium (Details) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019GBP (£)Options£ / sharesshares | Jun. 30, 2018GBP (£)shares | Dec. 31, 2018GBP (£)Options£ / sharesshares | |
Disclosure of classes of share capital | |||
Par value per share (in GBP per share) | £ / shares | £ 0.05 | £ 0.05 | |
Number of issued shares at beginning of year | shares | 2,593,044,409 | 2,587,175,445 | 2,587,175,445 |
Number of shares issued under share-based schemes | shares | 6,751,790 | 5,868,964 | |
Number of issued shares at end of year | shares | 2,599,796,199 | 2,593,044,409 | |
At beginning of period | £ 17,267,000,000 | £ 16,094,000,000 | £ 16,094,000,000 |
Shares issued under share-based schemes | 10,000,000 | 6,000,000 | |
At end of period | 19,695,000,000 | 15,890,000,000 | 17,267,000,000 |
Share capital | |||
Disclosure of classes of share capital | |||
At beginning of period | 130,000,000 | 129,000,000 | 129,000,000 |
Shares issued under share-based schemes | 1,000,000 | ||
At end of period | 130,000,000 | 129,000,000 | 130,000,000 |
Share premium | |||
Disclosure of classes of share capital | |||
At beginning of period | 1,964,000,000 | 1,948,000,000 | 1,948,000,000 |
Shares issued under share-based schemes | 10,000,000 | 6,000,000 | 16,000,000 |
At end of period | £ 1,974,000,000 | £ 1,954,000,000 | £ 1,964,000,000 |
SAYE options | |||
Options outstanding under save as you earn schemes | |||
Shares under option | Options | 3,808,687 | 4,885,804 | |
SAYE options | Minimum | |||
Options outstanding under save as you earn schemes | |||
Exercise price | £ 9.01 | £ 9.01 | |
SAYE options | Maximum | |||
Options outstanding under save as you earn schemes | |||
Exercise price | £ 14.55 | £ 14.55 |
Share capital, share premium _4
Share capital, share premium and own shares - Transactions in Prudential plc shares (Details) - GBP (£) £ in Millions, shares in Millions | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Dec. 31, 2018 | Mar. 31, 2019 | |
Transactions in Prudential plc shares | |||
Cost of own shares deducted from retained earnings | £ 179 | £ 170 | |
Shares held in trust for employee incentive plans | |||
Transactions in Prudential plc shares | |||
Number of shares held | 9.5 | 9.6 | |
Market value of shares held | £ 163 | £ 135 | |
Number of shares purchased | 3.1 | 2.6 | |
Cost of shares purchased | £ 49.4 | £ 44.8 | |
Shares held in authorized investment funds | |||
Transactions in Prudential plc shares | |||
Cost of own shares deducted from retained earnings | £ 21 | £ 20 | |
Number of shares held | 3 | 3 | |
Market value of shares held | £ 52 | £ 42 | |
Maximum | Shares held in trust for employee incentive plans | |||
Transactions in Prudential plc shares | |||
Number of shares held | 14.1 |
Gain (loss) on disposals of bus
Gain (loss) on disposals of business and corporate transactions (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Gain (loss) on disposal of businesses and corporate transactions | ||||
Gain on disposal | £ 209 | |||
Other transactions | (196) | £ (57) | ||
Gain (loss) on disposal of business and corporate transactions | 13 | £ (57) | ||
Transaction related costs - fees to advisors | (18) | |||
Fee paid to holders of subordinated debt instruments | (141) | |||
Business separation costs | £ (37) | |||
ICICI Prudential Life Insurance Company Limited | ||||
Gain (loss) on disposal of businesses and corporate transactions | ||||
Ownership percentage | 22.00% | 26.00% |
Discontinued UK and Europe op_3
Discontinued UK and Europe operations held for distribution - Profit and loss (Details) - GBP (£) £ in Millions | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | ||
Discontinued UK and Europe operations held for distribution | |||
Gross premiums earned | £ 16,293 | £ 14,786 | |
Outward reinsurance premiums | (520) | (363) | |
Earned premiums, net of reinsurance | 15,773 | 14,423 | |
Investment return | 24,633 | 1,381 | |
Other income | 199 | 215 | |
Total revenue, net of reinsurance | 40,605 | 16,019 | |
Benefits and claims and movement in unallocated surplus of with-profits funds, net of reinsurance | (36,671) | (10,928) | |
Acquisition costs and other expenditure | (2,711) | (3,285) | |
Total charges, net of reinsurance and gain (loss) on disposal of businesses | (39,595) | (14,459) | |
Share of profits from joint ventures and associates, net of related tax | 106 | 82 | |
Profit before tax (being tax attributable to shareholders' and policyholders' returns) | [1],[2] | 1,116 | 1,642 |
Less tax charge attributable to policyholders' returns | (220) | (43) | |
Profit before tax attributable to shareholders | 896 | 1,599 | |
Total tax charge attributable to policyholders and shareholders | (221) | (369) | |
Adjustment to remove tax charge attributable to policyholders' returns | 220 | 43 | |
Tax charge attributable to shareholders' returns | (1) | (326) | |
Profit for the period | 1,540 | 1,356 | |
Initial fee | 141 | ||
UK & Europe Operations (M&G Prudential) | |||
Discontinued UK and Europe operations held for distribution | |||
Gross premiums earned | 5,907 | 6,555 | |
Outward reinsurance premiums | (487) | (12,598) | |
Earned premiums, net of reinsurance | 5,420 | (6,043) | |
Investment return | 13,072 | 53 | |
Other income | 643 | 890 | |
Total revenue, net of reinsurance | 19,135 | (5,100) | |
Benefits and claims and movement in unallocated surplus of with-profits funds, net of reinsurance | (16,361) | 6,421 | |
Fair value loss on debt extinguishment | (169) | ||
Acquisition costs and other expenditure | (1,391) | (1,250) | |
Total charges, net of reinsurance and gain (loss) on disposal of businesses | (17,921) | 5,171 | |
Share of profits from joint ventures and associates, net of related tax | 33 | 20 | |
Profit before tax (being tax attributable to shareholders' and policyholders' returns) | 1,247 | 91 | |
Less tax charge attributable to policyholders' returns | (430) | 10 | |
Profit before tax attributable to shareholders | 817 | 101 | |
Total tax charge attributable to policyholders and shareholders | (602) | (8) | |
Adjustment to remove tax charge attributable to policyholders' returns | 430 | (10) | |
Tax charge attributable to shareholders' returns | (172) | (18) | |
Profit for the period | £ 645 | £ 83 | |
[1] | This measure is the formal profit before tax measure under IFRS but it is not the result attributable to shareholders, as explained in footnote (i) of the ‘Condensed consolidated income statements’. | ||
[2] | This measure is the formal profit before tax measure under IFRS but it is not the result attributable to shareholders. This is principally because the corporate taxes of the Group include those on the income of consolidated with-profits and unit-linked funds that, through adjustments to benefits, are borne by policyholders. These amounts are required to be included in the tax charge of the Company under IAS 12. Consequently, the profit before all taxes measure is not representative of pre-tax profits attributable to shareholders. Profit before all taxes is determined after deducting the cost of policyholder benefits and movements in the liability for unallocated surplus of with-profits funds after adjusting for taxes borne by policyholders. |
Discontinued UK and Europe op_4
Discontinued UK and Europe operations held for distribution - Other comprehensive income (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Other comprehensive income (loss) from continuing operations: | ||
Exchange movements arising during the period | £ 96 | £ 72 |
Shareholders' share of actuarial gains and (losses) on defined benefit pension schemes: | ||
Net actuarial (losses) gains on defined benefit pension schemes | (86) | 3 |
Related tax | 14 | (1) |
Other comprehensive income that will not be reclassified to profit or loss, net of tax | (72) | 2 |
UK & Europe Operations (M&G Prudential) | ||
Other comprehensive income (loss) from continuing operations: | ||
Exchange movements arising during the period | 2 | (3) |
Shareholders' share of actuarial gains and (losses) on defined benefit pension schemes: | ||
Net actuarial (losses) gains on defined benefit pension schemes | (177) | 104 |
Related tax | 30 | (18) |
Total | (147) | 86 |
Deduct amount attributable to UK with-profit funds transferred to unallocated surplus of with-profit funds, net of related tax | 149 | (21) |
Other comprehensive income that will not be reclassified to profit or loss, net of tax | 2 | 65 |
Other comprehensive income for the period, net of related tax | £ 4 | £ 62 |
Discontinued UK and Europe op_5
Discontinued UK and Europe operations held for distribution - Assumption changes (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Shareholder-backed | UK & Europe Operations (M&G Prudential) | Annuitant mortality assumptions | ||
Discontinued UK and Europe operations held for distribution | ||
Net effect of changes to assumptions | £ 127 | £ 0 |
Discontinued UK and Europe op_6
Discontinued UK and Europe operations held for distribution - Financial Position (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2017 | ||
Assets | ||||||
Goodwill | £ 510 | |||||
Deferred acquisition costs and other intangible assets | 12,659 | |||||
Property, plant and equipment | 785 | [1] | £ 378 | |||
Reinsurers' share of insurance contract liabilities | 10,151 | |||||
Deferred tax assets | 2,762 | |||||
Current tax recoverable | 371 | |||||
Accrued investment income | 1,332 | |||||
Other debtors | 2,011 | |||||
Investment properties | 11 | |||||
Investment in joint ventures and associates accounted for using the equity method | 1,030 | |||||
Loans | 12,513 | 12,443 | ||||
Equity securities and portfolio holdings in unit trusts | [2] | 183,670 | ||||
Debt securities | 99,675 | [2] | 89,400 | |||
Derivative assets | 1,222 | |||||
Other investments | [2] | 958 | ||||
Deposits | 1,491 | |||||
Cash and cash equivalents | 5,208 | £ 5,030 | ||||
Total assets | 554,683 | |||||
Total equity | 19,695 | 17,267 | 15,890 | £ 16,094 | ||
Liabilities | ||||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 285,168 | |||||
Unallocated surplus of with-profits funds | 2,944 | |||||
Operational borrowings attributable to shareholder-financed businesses | [1] | 1,664 | ||||
Borrowings attributable to with-profits businesses | [1] | 238 | ||||
Obligations under funding, securities lending and sale and repurchase agreements | 6,756 | |||||
Net asset value attributable to unit holders of consolidated unit trusts and similar funds | 3,482 | |||||
Deferred tax liabilities | 3,701 | |||||
Current tax liabilities | 319 | |||||
Accruals, deferred income and other liabilities | 10,597 | |||||
Provisions | 254 | |||||
Derivative liabilities | 1,037 | |||||
Total liabilities | 534,988 | |||||
Total equity and liabilities | 554,683 | |||||
With-profits | ||||||
Assets | ||||||
Deferred acquisition costs and other intangible assets | 58 | 56 | ||||
UK & Europe Operations (M&G Prudential) | ||||||
Assets | ||||||
Goodwill | 1,355 | 1,359 | ||||
Deferred acquisition costs and other intangible assets | 174 | 195 | ||||
Property, plant and equipment | 1,433 | 1,031 | ||||
Reinsurers' share of insurance contract liabilities | 2,690 | 2,812 | ||||
Deferred tax assets | 118 | 126 | ||||
Current tax recoverable | 279 | 244 | ||||
Accrued investment income | 1,445 | 1,511 | ||||
Other debtors | 3,429 | 4,189 | ||||
Investment properties | 18,634 | 17,914 | ||||
Investment in joint ventures and associates accounted for using the equity method | 605 | 742 | ||||
Loans | 5,535 | 5,567 | ||||
Equity securities and portfolio holdings in unit trusts | 59,653 | 53,810 | ||||
Debt securities | 85,174 | 85,956 | ||||
Derivative assets | 2,883 | 2,513 | ||||
Other investments | 6,133 | 5,585 | ||||
Deposits | 16,792 | 10,320 | ||||
Assets held for sale | 10,170 | 10,578 | ||||
Cash and cash equivalents | 4,624 | 4,749 | ||||
Total assets | 221,126 | 209,201 | ||||
Total equity | 8,280 | 8,700 | ||||
Liabilities | ||||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 159,604 | 151,555 | 154,655 | 167,589 | ||
Unallocated surplus of with-profits funds | 15,116 | 13,334 | 13,517 | 13,477 | ||
Operational borrowings attributable to shareholder-financed businesses | 456 | 106 | ||||
Borrowings attributable to with-profits businesses | 3,580 | 3,921 | ||||
Obligations under funding, securities lending and sale and repurchase agreements | 1,054 | 1,224 | ||||
Net asset value attributable to unit holders of consolidated unit trusts and similar funds | 8,512 | 9,013 | ||||
Deferred tax liabilities | 1,187 | 1,061 | ||||
Current tax liabilities | 395 | 326 | ||||
Accruals, deferred income and other liabilities | 9,517 | 6,442 | ||||
Provisions | 584 | 743 | ||||
Derivative liabilities | 2,677 | 2,208 | ||||
Liabilities held for sale | 10,164 | 10,568 | ||||
Total liabilities | 212,846 | 200,501 | ||||
Total equity and liabilities | 221,126 | 209,201 | ||||
UK & Europe Operations (M&G Prudential) | With-profits | ||||||
Assets | ||||||
Deferred acquisition costs and other intangible assets | 83 | |||||
Loans | 3,756 | 3,853 | ||||
Debt securities | 54,796 | 53,798 | ||||
UK & Europe Operations (M&G Prudential) | Unit-linked | ||||||
Assets | ||||||
Debt securities | 8,727 | 10,512 | ||||
UK & Europe Operations (M&G Prudential) | UK and Europe with-profits | With-profits | ||||||
Liabilities | ||||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 118,148 | 110,795 | 112,339 | 111,222 | ||
Unallocated surplus of with-profits funds | 15,116 | 13,334 | 13,517 | 13,477 | ||
UK & Europe Operations (M&G Prudential) | UK and Europe other funds and subsidiaries | Unit-linked | ||||||
Liabilities | ||||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 21,172 | 20,717 | 22,198 | 23,145 | ||
UK & Europe Operations (M&G Prudential) | UK and Europe other funds and subsidiaries | Annuity and other | ||||||
Liabilities | ||||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 20,284 | 20,043 | £ 20,118 | £ 33,222 | ||
UK & Europe Operations (M&G Prudential) | Operating segments | ||||||
Assets | ||||||
Total assets | 221,126 | |||||
Total equity | 8,280 | |||||
Liabilities | ||||||
Total liabilities | 212,846 | |||||
Total equity and liabilities | 221,126 | |||||
UK & Europe Operations (M&G Prudential) | Elimination of intra-segment amounts | ||||||
Assets | ||||||
Other debtors | (151) | |||||
Total assets | (151) | |||||
Liabilities | ||||||
Accruals, deferred income and other liabilities | (151) | |||||
Total liabilities | (151) | |||||
Total equity and liabilities | (151) | |||||
UK & Europe Operations (M&G Prudential) | UK and Europe insurance operations | Operations within segments | ||||||
Assets | ||||||
Goodwill | 202 | |||||
Deferred acquisition costs and other intangible assets | 157 | |||||
Property, plant and equipment | 1,063 | |||||
Reinsurers' share of insurance contract liabilities | 2,690 | |||||
Deferred tax assets | 101 | |||||
Current tax recoverable | 272 | |||||
Accrued investment income | 1,435 | |||||
Other debtors | 3,104 | |||||
Investment properties | 18,634 | |||||
Investment in joint ventures and associates accounted for using the equity method | 566 | |||||
Loans | 5,535 | |||||
Equity securities and portfolio holdings in unit trusts | 59,437 | |||||
Debt securities | 85,137 | |||||
Derivative assets | 2,883 | |||||
Other investments | 6,115 | |||||
Deposits | 16,792 | |||||
Assets held for sale | 10,170 | |||||
Cash and cash equivalents | 4,272 | |||||
Total assets | 218,565 | |||||
Total equity | 6,287 | |||||
Liabilities | ||||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 159,604 | |||||
Unallocated surplus of with-profits funds | 15,116 | |||||
Operational borrowings attributable to shareholder-financed businesses | 160 | |||||
Borrowings attributable to with-profits businesses | 3,580 | |||||
Obligations under funding, securities lending and sale and repurchase agreements | 1,054 | |||||
Net asset value attributable to unit holders of consolidated unit trusts and similar funds | 8,493 | |||||
Deferred tax liabilities | 1,158 | |||||
Current tax liabilities | 361 | |||||
Accruals, deferred income and other liabilities | 9,517 | |||||
Provisions | 394 | |||||
Derivative liabilities | 2,677 | |||||
Liabilities held for sale | 10,164 | |||||
Total liabilities | 212,278 | |||||
Total equity and liabilities | 218,565 | |||||
UK & Europe Operations (M&G Prudential) | UK and Europe insurance operations | Operations within segments | UK and Europe with-profits | With-profits | ||||||
Assets | ||||||
Goodwill | 202 | |||||
Deferred acquisition costs and other intangible assets | 47 | |||||
Property, plant and equipment | 997 | |||||
Reinsurers' share of insurance contract liabilities | 1,136 | |||||
Deferred tax assets | 58 | |||||
Current tax recoverable | 215 | |||||
Accrued investment income | 1,056 | |||||
Other debtors | 2,105 | |||||
Investment properties | 16,406 | |||||
Investment in joint ventures and associates accounted for using the equity method | 566 | |||||
Loans | 3,756 | |||||
Equity securities and portfolio holdings in unit trusts | 45,743 | |||||
Debt securities | 54,796 | |||||
Derivative assets | 2,354 | |||||
Other investments | 6,105 | |||||
Deposits | 13,422 | |||||
Assets held for sale | 6 | |||||
Cash and cash equivalents | 3,311 | |||||
Total assets | 152,281 | |||||
Liabilities | ||||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 118,148 | |||||
Unallocated surplus of with-profits funds | 15,116 | |||||
Borrowings attributable to with-profits businesses | 3,580 | |||||
Obligations under funding, securities lending and sale and repurchase agreements | 846 | |||||
Net asset value attributable to unit holders of consolidated unit trusts and similar funds | 4,827 | |||||
Deferred tax liabilities | 995 | |||||
Current tax liabilities | 293 | |||||
Accruals, deferred income and other liabilities | 6,988 | |||||
Provisions | 21 | |||||
Derivative liabilities | 1,467 | |||||
Total liabilities | 152,281 | |||||
Total equity and liabilities | 152,281 | |||||
UK & Europe Operations (M&G Prudential) | UK and Europe insurance operations | Operations within segments | Scottish Amicable Insurance Fund | With-profits | ||||||
Assets | ||||||
Total assets | 4,887 | 4,844 | ||||
UK & Europe Operations (M&G Prudential) | UK and Europe insurance operations | Operations within segments | PAC with-profits fund | With-profits | ||||||
Liabilities | ||||||
Non-profits annuities liabilities | 9,600 | £ 9,500 | ||||
UK & Europe Operations (M&G Prudential) | UK and Europe insurance operations | Operations within segments | UK and Europe other funds and subsidiaries | Unit-linked | ||||||
Assets | ||||||
Reinsurers' share of insurance contract liabilities | 119 | |||||
Accrued investment income | 89 | |||||
Other debtors | 773 | |||||
Investment properties | 580 | |||||
Equity securities and portfolio holdings in unit trusts | 13,678 | |||||
Debt securities | 8,727 | |||||
Derivative assets | 2 | |||||
Other investments | 9 | |||||
Deposits | 1,235 | |||||
Cash and cash equivalents | 169 | |||||
Total assets | 25,381 | |||||
Liabilities | ||||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 21,172 | |||||
Operational borrowings attributable to shareholder-financed businesses | 4 | |||||
Net asset value attributable to unit holders of consolidated unit trusts and similar funds | 3,659 | |||||
Current tax liabilities | 36 | |||||
Accruals, deferred income and other liabilities | 498 | |||||
Derivative liabilities | 12 | |||||
Total liabilities | 25,381 | |||||
Total equity and liabilities | 25,381 | |||||
UK & Europe Operations (M&G Prudential) | UK and Europe insurance operations | Operations within segments | UK and Europe other funds and subsidiaries | Annuity and other | ||||||
Assets | ||||||
Deferred acquisition costs and other intangible assets | 110 | |||||
Property, plant and equipment | 66 | |||||
Reinsurers' share of insurance contract liabilities | 1,435 | |||||
Deferred tax assets | 43 | |||||
Current tax recoverable | 57 | |||||
Accrued investment income | 290 | |||||
Other debtors | 226 | |||||
Investment properties | 1,648 | |||||
Loans | 1,779 | |||||
Equity securities and portfolio holdings in unit trusts | 16 | |||||
Debt securities | 21,614 | |||||
Derivative assets | 527 | |||||
Other investments | 1 | |||||
Deposits | 2,135 | |||||
Assets held for sale | 10,164 | |||||
Cash and cash equivalents | 792 | |||||
Total assets | 40,903 | |||||
Total equity | 6,287 | |||||
Liabilities | ||||||
Contract liabilities (including amounts in respect of contracts classified as investment contracts under IFRS 4) | 20,284 | |||||
Operational borrowings attributable to shareholder-financed businesses | 156 | |||||
Obligations under funding, securities lending and sale and repurchase agreements | 208 | |||||
Net asset value attributable to unit holders of consolidated unit trusts and similar funds | 7 | |||||
Deferred tax liabilities | 163 | |||||
Current tax liabilities | 32 | |||||
Accruals, deferred income and other liabilities | 2,031 | |||||
Provisions | 373 | |||||
Derivative liabilities | 1,198 | |||||
Liabilities held for sale | 10,164 | |||||
Total liabilities | 34,616 | |||||
Total equity and liabilities | 40,903 | |||||
UK & Europe Operations (M&G Prudential) | UK and Europe asset management | Operations within segments | ||||||
Assets | ||||||
Goodwill | 1,153 | |||||
Deferred acquisition costs and other intangible assets | 17 | |||||
Property, plant and equipment | 370 | |||||
Deferred tax assets | 17 | |||||
Current tax recoverable | 7 | |||||
Accrued investment income | 10 | |||||
Other debtors | 476 | |||||
Investment in joint ventures and associates accounted for using the equity method | 39 | |||||
Equity securities and portfolio holdings in unit trusts | 216 | |||||
Debt securities | 37 | |||||
Other investments | 18 | |||||
Cash and cash equivalents | 352 | |||||
Total assets | 2,712 | |||||
Total equity | 1,993 | |||||
Liabilities | ||||||
Operational borrowings attributable to shareholder-financed businesses | 296 | |||||
Net asset value attributable to unit holders of consolidated unit trusts and similar funds | 19 | |||||
Deferred tax liabilities | 29 | |||||
Current tax liabilities | 34 | |||||
Accruals, deferred income and other liabilities | 151 | |||||
Provisions | 190 | |||||
Total liabilities | 719 | |||||
Total equity and liabilities | £ 2,712 | |||||
[1] | As at 1 January 2019, the Group applied IFRS 16, ‘Leases’, using the modified retrospective approach. Under this approach, comparative information is not restated. The application of the standard has resulted in the recognition of an additional lease liability and a corresponding ‘right-of-use’ asset of a similar amount as at 1 January 2019. See note A3 for further details. As at 30 June 2019, right-of-use assets recognised in property, plant and equipment for continuing operations amounted to £425 million. | |||||
[2] | Included within equity securities and portfolio holdings in unit trusts, debt securities and other investments are £8 million of lent securities as at 30 June 2019 (31 December 2018: £8,278 million). |
Discontinued UK and Europe op_7
Discontinued UK and Europe operations held for distribution - Goodwill, Property, plant and equipment (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Discontinued UK and Europe operations held for distribution | ||
Goodwill | £ 510 | |
Right-of-use assets | 425 | |
UK & Europe Operations (M&G Prudential) | ||
Discontinued UK and Europe operations held for distribution | ||
Goodwill | 1,355 | £ 1,359 |
Right-of-use assets | 278 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | ||
Discontinued UK and Europe operations held for distribution | ||
Goodwill | 1,153 | 1,153 |
UK & Europe Operations (M&G Prudential) | Venture funds investments | With-profits | ||
Discontinued UK and Europe operations held for distribution | ||
Goodwill | £ 202 | £ 206 |
Discontinued UK and Europe op_8
Discontinued UK and Europe operations held for distribution - Fair value measurement of financial assets and liabilities (Details) - GBP (£) £ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Financial instruments | ||
Transfers from level 1 to level 2 | £ 131 | |
Transfers into level 3 | 0 | |
Transfers out of level 3 | 0 | |
At fair value | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | 287,287 | |
Total financial instruments at fair value | £ 280,053 | £ 247,533 |
Percentage of total (%) | 100.00% | 100.00% |
At fair value | Loans | ||
Financial instruments | ||
Financial assets | £ 2,799 | |
At fair value | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | 183,670 | |
At fair value | Debt securities | ||
Financial instruments | ||
Financial assets | 99,675 | |
At fair value | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 2,180 | |
At fair value | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (1,037) | |
At fair value | Investment contract liabilities without discretionary participation features held at fair value | ||
Financial instruments | ||
Financial liabilities | (666) | |
At fair value | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | ||
Financial instruments | ||
Financial liabilities | (3,482) | |
At fair value | Other financial liabilities | ||
Financial instruments | ||
Financial liabilities | (3,086) | |
At fair value | With-profits | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 53,583 | |
Percentage of total (%) | 100.00% | |
Total financial instruments at fair value | £ 43,278 | |
At fair value | With-profits | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 21,377 | |
At fair value | With-profits | Debt securities | ||
Financial instruments | ||
Financial assets | 32,063 | |
At fair value | With-profits | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 188 | |
At fair value | With-profits | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (45) | |
At fair value | Level 1 | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | 229,987 | |
Total financial instruments at fair value | £ 226,505 | £ 199,296 |
Percentage of total (%) | 81.00% | 81.00% |
At fair value | Level 1 | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 181,360 | |
At fair value | Level 1 | Debt securities | ||
Financial instruments | ||
Financial assets | 48,530 | |
At fair value | Level 1 | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 149 | |
At fair value | Level 1 | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (52) | |
At fair value | Level 1 | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | ||
Financial instruments | ||
Financial liabilities | (3,482) | |
At fair value | Level 1 | With-profits | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 48,355 | |
Percentage of total (%) | 90.00% | |
Total financial instruments at fair value | £ 39,191 | |
At fair value | Level 1 | With-profits | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 19,318 | |
At fair value | Level 1 | With-profits | Debt securities | ||
Financial instruments | ||
Financial assets | 28,964 | |
At fair value | Level 1 | With-profits | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 107 | |
At fair value | Level 1 | With-profits | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (34) | |
At fair value | Level 2 | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | 53,818 | |
Total financial instruments at fair value | £ 53,147 | £ 47,812 |
Percentage of total (%) | 19.00% | 19.00% |
At fair value | Level 2 | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 2,140 | |
At fair value | Level 2 | Debt securities | ||
Financial instruments | ||
Financial assets | 51,139 | |
At fair value | Level 2 | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 1,069 | |
At fair value | Level 2 | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (530) | |
At fair value | Level 2 | Investment contract liabilities without discretionary participation features held at fair value | ||
Financial instruments | ||
Financial liabilities | (666) | |
At fair value | Level 2 | Other financial liabilities | ||
Financial instruments | ||
Financial liabilities | (5) | |
At fair value | Level 2 | With-profits | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 5,069 | |
Percentage of total (%) | 10.00% | |
Total financial instruments at fair value | £ 3,928 | |
At fair value | Level 2 | With-profits | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 1,906 | |
At fair value | Level 2 | With-profits | Debt securities | ||
Financial instruments | ||
Financial assets | 3,093 | |
At fair value | Level 2 | With-profits | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 81 | |
At fair value | Level 2 | With-profits | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (11) | |
At fair value | Level 3 | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | 3,482 | |
Total financial instruments at fair value | £ 401 | £ 425 |
Percentage of total (%) | 0.00% | 0.00% |
At fair value | Level 3 | Loans | ||
Financial instruments | ||
Financial assets | £ 2,799 | |
At fair value | Level 3 | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | 170 | |
At fair value | Level 3 | Debt securities | ||
Financial instruments | ||
Financial assets | 6 | |
At fair value | Level 3 | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 962 | |
At fair value | Level 3 | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (455) | |
Total financial instruments at fair value | (451) | |
At fair value | Level 3 | Other financial liabilities | ||
Financial instruments | ||
Financial liabilities | (3,081) | |
At fair value | Level 3 | With-profits | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 159 | |
Percentage of total (%) | 0.00% | |
Total financial instruments at fair value | £ 159 | |
At fair value | Level 3 | With-profits | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 153 | |
At fair value | Level 3 | With-profits | Debt securities | ||
Financial instruments | ||
Financial assets | 6 | |
UK & Europe Operations (M&G Prudential) | ||
Financial instruments | ||
Transfers from level 1 to level 2 | 104 | |
UK & Europe Operations (M&G Prudential) | Level 1 | ||
Financial instruments | ||
Transfers into level 3 | 19 | |
UK & Europe Operations (M&G Prudential) | Level 2 | ||
Financial instruments | ||
Transfers into level 3 | 58 | |
Transfers out of level 3 | 118 | |
UK & Europe Operations (M&G Prudential) | At fair value | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | 153,106 | 147,626 |
Total financial instruments at fair value | £ 127,016 | £ 121,092 |
Percentage of total (%) | 100.00% | 100.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Loans | ||
Financial instruments | ||
Financial assets | £ 1,940 | £ 1,970 |
UK & Europe Operations (M&G Prudential) | At fair value | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | 59,653 | 53,810 |
UK & Europe Operations (M&G Prudential) | At fair value | Debt securities | ||
Financial instruments | ||
Financial assets | 85,174 | 85,956 |
UK & Europe Operations (M&G Prudential) | At fair value | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 9,016 | 8,098 |
UK & Europe Operations (M&G Prudential) | At fair value | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (2,677) | (2,208) |
UK & Europe Operations (M&G Prudential) | At fair value | Investment contract liabilities without discretionary participation features held at fair value | ||
Financial instruments | ||
Financial liabilities | (15,695) | (15,560) |
UK & Europe Operations (M&G Prudential) | At fair value | Borrowings attributable to with-profits businesses | ||
Financial instruments | ||
Financial liabilities | (1,504) | (1,606) |
UK & Europe Operations (M&G Prudential) | At fair value | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | ||
Financial instruments | ||
Financial liabilities | (8,512) | (9,013) |
UK & Europe Operations (M&G Prudential) | At fair value | Other financial liabilities | ||
Financial instruments | ||
Financial liabilities | (379) | (355) |
UK & Europe Operations (M&G Prudential) | At fair value | With-profits | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 109,168 | £ 102,856 |
Percentage of total (%) | 100.00% | 100.00% |
UK & Europe Operations (M&G Prudential) | At fair value | With-profits | Loans | ||
Financial instruments | ||
Financial assets | £ 1,637 | £ 1,703 |
UK & Europe Operations (M&G Prudential) | At fair value | With-profits | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | 45,743 | 41,090 |
UK & Europe Operations (M&G Prudential) | At fair value | With-profits | Debt securities | ||
Financial instruments | ||
Financial assets | 54,796 | 53,798 |
UK & Europe Operations (M&G Prudential) | At fair value | With-profits | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 8,459 | 7,530 |
UK & Europe Operations (M&G Prudential) | At fair value | With-profits | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (1,467) | (1,265) |
UK & Europe Operations (M&G Prudential) | At fair value | Unit-linked | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 22,404 | £ 22,997 |
Percentage of total (%) | 100.00% | 100.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Unit-linked | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 13,678 | £ 12,477 |
UK & Europe Operations (M&G Prudential) | At fair value | Unit-linked | Debt securities | ||
Financial instruments | ||
Financial assets | 8,727 | 10,512 |
UK & Europe Operations (M&G Prudential) | At fair value | Unit-linked | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 11 | 11 |
UK & Europe Operations (M&G Prudential) | At fair value | Unit-linked | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (12) | (3) |
UK & Europe Operations (M&G Prudential) | At fair value | Shareholder-backed annuities and other | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 21,534 | £ 21,773 |
Percentage of total (%) | 100.00% | 100.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Shareholder-backed annuities and other | Loans | ||
Financial instruments | ||
Financial assets | £ 303 | £ 267 |
UK & Europe Operations (M&G Prudential) | At fair value | Shareholder-backed annuities and other | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | 232 | 243 |
UK & Europe Operations (M&G Prudential) | At fair value | Shareholder-backed annuities and other | Debt securities | ||
Financial instruments | ||
Financial assets | 21,651 | 21,646 |
UK & Europe Operations (M&G Prudential) | At fair value | Shareholder-backed annuities and other | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 546 | 557 |
UK & Europe Operations (M&G Prudential) | At fair value | Shareholder-backed annuities and other | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (1,198) | (940) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | 67,470 | 63,343 |
Total financial instruments at fair value | £ 60,686 | £ 55,900 |
Percentage of total (%) | 47.00% | 46.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 54,553 | £ 49,419 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Debt securities | ||
Financial instruments | ||
Financial assets | 12,912 | 13,928 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 70 | 61 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (65) | (65) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | ||
Financial instruments | ||
Financial liabilities | (6,784) | (7,443) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | With-profits | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 49,133 | £ 45,393 |
Percentage of total (%) | 45.00% | 44.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | With-profits | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 41,593 | £ 37,027 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | With-profits | Debt securities | ||
Financial instruments | ||
Financial assets | 7,534 | 8,374 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | With-profits | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 66 | 56 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | With-profits | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (60) | (64) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Unit-linked | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 14,546 | £ 13,903 |
Percentage of total (%) | 65.00% | 60.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Unit-linked | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 12,728 | £ 12,150 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Unit-linked | Debt securities | ||
Financial instruments | ||
Financial assets | 1,818 | 1,750 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Unit-linked | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 4 | 4 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Unit-linked | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (4) | (1) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Shareholder-backed annuities and other | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 3,791 | £ 4,047 |
Percentage of total (%) | 18.00% | 19.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Shareholder-backed annuities and other | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 232 | £ 242 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Shareholder-backed annuities and other | Debt securities | ||
Financial instruments | ||
Financial assets | 3,560 | 3,804 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Shareholder-backed annuities and other | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 1 | |
UK & Europe Operations (M&G Prudential) | At fair value | Level 1 | Shareholder-backed annuities and other | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (1) | |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | 76,974 | 76,458 |
Total financial instruments at fair value | £ 60,535 | £ 60,316 |
Percentage of total (%) | 48.00% | 50.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 4,697 | £ 4,046 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Debt securities | ||
Financial instruments | ||
Financial assets | 71,073 | 70,851 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 3,809 | 3,704 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (2,605) | (2,143) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Investment contract liabilities without discretionary participation features held at fair value | ||
Financial instruments | ||
Financial liabilities | (15,695) | (15,560) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | ||
Financial instruments | ||
Financial liabilities | (744) | (582) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | With-profits | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 52,050 | £ 50,295 |
Percentage of total (%) | 48.00% | 49.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | With-profits | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 3,758 | £ 3,728 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | With-profits | Debt securities | ||
Financial instruments | ||
Financial assets | 46,410 | 44,619 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | With-profits | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 3,282 | 3,149 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | With-profits | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (1,400) | (1,201) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Unit-linked | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 7,840 | £ 9,079 |
Percentage of total (%) | 35.00% | 40.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Unit-linked | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 939 | £ 318 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Unit-linked | Debt securities | ||
Financial instruments | ||
Financial assets | 6,909 | 8,762 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Unit-linked | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 1 | |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Unit-linked | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (8) | (2) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Shareholder-backed annuities and other | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 17,084 | £ 17,084 |
Percentage of total (%) | 79.00% | 78.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Shareholder-backed annuities and other | Debt securities | ||
Financial instruments | ||
Financial assets | £ 17,754 | £ 17,470 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Shareholder-backed annuities and other | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 527 | 554 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 2 | Shareholder-backed annuities and other | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (1,197) | (940) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | 8,662 | 7,825 |
Total financial instruments at fair value | £ 5,795 | £ 4,876 |
Percentage of total (%) | 5.00% | 4.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Internal valuation | ||
Financial instruments | ||
Total financial instruments at fair value | £ 163 | |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | External valuation | ||
Financial instruments | ||
Total financial instruments at fair value | 5,632 | |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Loans | ||
Financial instruments | ||
Financial assets | 1,940 | £ 1,970 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | 403 | 345 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Debt securities | ||
Financial instruments | ||
Financial assets | 1,189 | 1,177 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 5,137 | 4,333 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (7) | |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Borrowings attributable to with-profits businesses | ||
Financial instruments | ||
Financial liabilities | (1,504) | (1,606) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Net asset value attributable to unit holders of consolidated unit trusts and similar funds | ||
Financial instruments | ||
Financial liabilities | (984) | (988) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Other financial liabilities | ||
Financial instruments | ||
Financial liabilities | (379) | (355) |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | With-profits | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 7,985 | £ 7,168 |
Percentage of total (%) | 7.00% | 7.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | With-profits | Loans | ||
Financial instruments | ||
Financial assets | £ 1,637 | £ 1,703 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | With-profits | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | 392 | 335 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | With-profits | Debt securities | ||
Financial instruments | ||
Financial assets | 852 | 805 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | With-profits | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 5,111 | 4,325 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | With-profits | Derivative liabilities | ||
Financial instruments | ||
Financial liabilities | (7) | |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Unit-linked | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 18 | £ 15 |
Percentage of total (%) | 0.00% | 0.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Unit-linked | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | £ 11 | £ 9 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Unit-linked | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | 7 | 6 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Shareholder-backed annuities and other | ||
Financial instruments | ||
Total financial investments, net of derivative liabilities | £ 659 | £ 642 |
Percentage of total (%) | 3.00% | 3.00% |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Shareholder-backed annuities and other | Loans | ||
Financial instruments | ||
Financial assets | £ 303 | £ 267 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Shareholder-backed annuities and other | Equity securities and portfolio holdings in unit trusts | ||
Financial instruments | ||
Financial assets | 1 | |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Shareholder-backed annuities and other | Debt securities | ||
Financial instruments | ||
Financial assets | 337 | 372 |
UK & Europe Operations (M&G Prudential) | At fair value | Level 3 | Shareholder-backed annuities and other | Other investments (including derivative assets) | ||
Financial instruments | ||
Financial assets | £ 19 | £ 2 |
Discontinued UK and Europe op_9
Discontinued UK and Europe operations held for distribution - Assets and liabilities at amortised cost and their fair value (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Financial instruments | ||
Total financial instruments carried at amortised cost | £ (9,075) | £ (7,848) |
Loans | ||
Financial instruments | ||
Financial assets at amortised cost | 9,714 | |
Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (1,435) | |
Borrowings (excluding lease liabilities) attributable to the with-profits funds | ||
Financial instruments | ||
Financial liabilities at amortised cost | (25) | |
Obligations under funding, securities lending and sale and repurchase agreements | ||
Financial instruments | ||
Financial liabilities at amortised cost | (6,756) | |
Fair value of instruments not measured at fair value | ||
Financial instruments | ||
Total financial instruments carried at amortised cost | (9,531) | (8,040) |
Fair value of instruments not measured at fair value | Loans | ||
Financial instruments | ||
Financial assets at amortised cost | 10,010 | |
Fair value of instruments not measured at fair value | Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (1,435) | |
Fair value of instruments not measured at fair value | Borrowings (excluding lease liabilities) attributable to the with-profits funds | ||
Financial instruments | ||
Financial liabilities at amortised cost | (24) | |
Fair value of instruments not measured at fair value | Obligations under funding, securities lending and sale and repurchase agreements | ||
Financial instruments | ||
Financial liabilities at amortised cost | (6,890) | |
UK & Europe Operations (M&G Prudential) | ||
Financial instruments | ||
Total financial instruments carried at amortised cost | 389 | (48) |
UK & Europe Operations (M&G Prudential) | Loans | ||
Financial instruments | ||
Financial assets at amortised cost | 3,595 | 3,597 |
UK & Europe Operations (M&G Prudential) | Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (114) | (106) |
UK & Europe Operations (M&G Prudential) | Borrowings (excluding lease liabilities) attributable to the with-profits funds | ||
Financial instruments | ||
Financial liabilities at amortised cost | (2,038) | (2,315) |
UK & Europe Operations (M&G Prudential) | Obligations under funding, securities lending and sale and repurchase agreements | ||
Financial instruments | ||
Financial liabilities at amortised cost | (1,054) | (1,224) |
UK & Europe Operations (M&G Prudential) | Fair value of instruments not measured at fair value | ||
Financial instruments | ||
Total financial instruments carried at amortised cost | 943 | 593 |
UK & Europe Operations (M&G Prudential) | Fair value of instruments not measured at fair value | Loans | ||
Financial instruments | ||
Financial assets at amortised cost | 4,149 | 4,008 |
UK & Europe Operations (M&G Prudential) | Fair value of instruments not measured at fair value | Operational borrowings (excluding lease liabilities) attributable to shareholder-financed businesses | ||
Financial instruments | ||
Financial liabilities at amortised cost | (114) | (106) |
UK & Europe Operations (M&G Prudential) | Fair value of instruments not measured at fair value | Borrowings (excluding lease liabilities) attributable to the with-profits funds | ||
Financial instruments | ||
Financial liabilities at amortised cost | (2,038) | (2,085) |
UK & Europe Operations (M&G Prudential) | Fair value of instruments not measured at fair value | Obligations under funding, securities lending and sale and repurchase agreements | ||
Financial instruments | ||
Financial liabilities at amortised cost | £ (1,054) | £ (1,224) |
Discontinued UK and Europe o_10
Discontinued UK and Europe operations held for distribution - Debt securities, Loans (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | |
Discontinued UK and Europe operations held for distribution | |||
Debt securities | £ 99,675 | [1] | £ 89,400 |
AAA | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 6,319 | 6,032 | |
AA+ to AA- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 28,456 | 24,503 | |
A+ to A- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 21,297 | 18,848 | |
BBB+ to BBB- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 24,498 | 22,823 | |
Below BBB- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 6,516 | 5,853 | |
Other (including NAIC rated) | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 12,589 | 11,341 | |
UK & Europe Operations (M&G Prudential) | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 85,174 | 85,956 | |
UK & Europe Operations (M&G Prudential) | AAA | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 8,770 | 10,938 | |
UK & Europe Operations (M&G Prudential) | AA+ to AA- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 16,628 | 18,204 | |
UK & Europe Operations (M&G Prudential) | A+ to A- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 20,020 | 18,645 | |
UK & Europe Operations (M&G Prudential) | BBB+ to BBB- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 19,746 | 19,728 | |
UK & Europe Operations (M&G Prudential) | Below BBB- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 3,969 | 3,444 | |
UK & Europe Operations (M&G Prudential) | Other (including NAIC rated) | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 16,041 | 14,997 | |
UK & Europe Operations (M&G Prudential) | Other (including NAIC rated) | AAA to A- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 8,630 | 8,150 | |
UK & Europe Operations (M&G Prudential) | Other (including NAIC rated) | BBB to B- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 2,947 | 3,034 | |
UK & Europe Operations (M&G Prudential) | Other (including NAIC rated) | Below B- or unrated | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 4,464 | 3,813 | |
UK & Europe Operations (M&G Prudential) | With-profits | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 54,796 | 53,798 | |
UK & Europe Operations (M&G Prudential) | With-profits | AAA | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 5,401 | 6,890 | |
UK & Europe Operations (M&G Prudential) | With-profits | AA+ to AA- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 8,488 | 9,332 | |
UK & Europe Operations (M&G Prudential) | With-profits | A+ to A- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 13,446 | 11,779 | |
UK & Europe Operations (M&G Prudential) | With-profits | BBB+ to BBB- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 15,641 | 14,712 | |
UK & Europe Operations (M&G Prudential) | With-profits | Below BBB- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 2,824 | 2,891 | |
UK & Europe Operations (M&G Prudential) | With-profits | Other (including NAIC rated) | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 8,996 | 8,194 | |
UK & Europe Operations (M&G Prudential) | Unit-linked | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 8,727 | 10,512 | |
UK & Europe Operations (M&G Prudential) | Unit-linked | AAA | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 578 | 1,041 | |
UK & Europe Operations (M&G Prudential) | Unit-linked | AA+ to AA- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 2,025 | 2,459 | |
UK & Europe Operations (M&G Prudential) | Unit-linked | A+ to A- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 1,959 | 2,215 | |
UK & Europe Operations (M&G Prudential) | Unit-linked | BBB+ to BBB- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 2,450 | 3,501 | |
UK & Europe Operations (M&G Prudential) | Unit-linked | Below BBB- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 934 | 395 | |
UK & Europe Operations (M&G Prudential) | Unit-linked | Other (including NAIC rated) | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 781 | 901 | |
UK & Europe Operations (M&G Prudential) | Non-linked shareholder-backed | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 21,651 | 21,646 | |
UK & Europe Operations (M&G Prudential) | Non-linked shareholder-backed | AAA | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 2,791 | 3,007 | |
UK & Europe Operations (M&G Prudential) | Non-linked shareholder-backed | AA+ to AA- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 6,115 | 6,413 | |
UK & Europe Operations (M&G Prudential) | Non-linked shareholder-backed | A+ to A- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 4,615 | 4,651 | |
UK & Europe Operations (M&G Prudential) | Non-linked shareholder-backed | BBB+ to BBB- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 1,655 | 1,515 | |
UK & Europe Operations (M&G Prudential) | Non-linked shareholder-backed | Below BBB- | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | 211 | 158 | |
UK & Europe Operations (M&G Prudential) | Non-linked shareholder-backed | Other (including NAIC rated) | |||
Discontinued UK and Europe operations held for distribution | |||
Debt securities | £ 6,264 | £ 5,902 | |
[1] | Included within equity securities and portfolio holdings in unit trusts, debt securities and other investments are £8 million of lent securities as at 30 June 2019 (31 December 2018: £8,278 million). |
Discontinued UK and Europe o_11
Discontinued UK and Europe operations held for distribution - Exposure to sovereign debts and bank debt securities (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Shareholder-backed | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | £ 11,658 | |
Bank debt instruments held | 4,640 | |
With-profits | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 13,144 | |
Bank debt instruments held | 1,287 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | £ 2,707 | 2,735 |
Bank debt instruments held | 1,261 | 1,087 |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 1,039 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Covered senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 471 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 568 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 222 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 222 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Eurozone | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 412 | 378 |
Bank debt instruments held | 184 | 120 |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Eurozone | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 94 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Eurozone | Covered senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 21 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Eurozone | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 73 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Eurozone | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 90 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Eurozone | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 90 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Spain | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 49 | 36 |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | France | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 23 | |
Bank debt instruments held | 57 | 20 |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | France | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 57 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | France | Covered senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 21 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | France | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 36 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Germany | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 240 | 239 |
Bank debt instruments held | 90 | 83 |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Germany | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 90 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Germany | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 90 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Netherlands | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 37 | 17 |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Netherlands | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 37 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Netherlands | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 37 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Other Eurozone | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 100 | 103 |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | UK | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 2,235 | 2,300 |
Bank debt instruments held | 760 | 674 |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | UK | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 693 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | UK | Covered senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 450 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | UK | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 243 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | UK | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 67 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | UK | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 67 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | US | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 281 | 253 |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | US | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 252 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | US | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 252 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | US | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 29 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | US | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 29 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Other | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 60 | 57 |
Bank debt instruments held | 36 | 40 |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Other | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 36 | |
UK & Europe Operations (M&G Prudential) | Shareholder-backed | Other | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 36 | |
UK & Europe Operations (M&G Prudential) | With-profits | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 3,911 | 4,912 |
Bank debt instruments held | 7,996 | 7,438 |
UK & Europe Operations (M&G Prudential) | With-profits | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 7,139 | |
UK & Europe Operations (M&G Prudential) | With-profits | Covered senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 1,505 | |
UK & Europe Operations (M&G Prudential) | With-profits | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 5,634 | |
UK & Europe Operations (M&G Prudential) | With-profits | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 857 | |
UK & Europe Operations (M&G Prudential) | With-profits | Tier 1 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 83 | |
UK & Europe Operations (M&G Prudential) | With-profits | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 774 | |
UK & Europe Operations (M&G Prudential) | With-profits | Eurozone | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 435 | 440 |
Bank debt instruments held | 1,069 | 911 |
UK & Europe Operations (M&G Prudential) | With-profits | Eurozone | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 987 | |
UK & Europe Operations (M&G Prudential) | With-profits | Eurozone | Covered senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 122 | |
UK & Europe Operations (M&G Prudential) | With-profits | Eurozone | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 865 | |
UK & Europe Operations (M&G Prudential) | With-profits | Eurozone | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 82 | |
UK & Europe Operations (M&G Prudential) | With-profits | Eurozone | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 82 | |
UK & Europe Operations (M&G Prudential) | With-profits | Italy | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 59 | 57 |
Bank debt instruments held | 39 | 38 |
UK & Europe Operations (M&G Prudential) | With-profits | Italy | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 39 | |
UK & Europe Operations (M&G Prudential) | With-profits | Italy | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 39 | |
UK & Europe Operations (M&G Prudential) | With-profits | Spain | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 19 | 18 |
Bank debt instruments held | 26 | 17 |
UK & Europe Operations (M&G Prudential) | With-profits | Spain | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 26 | |
UK & Europe Operations (M&G Prudential) | With-profits | Spain | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 26 | |
UK & Europe Operations (M&G Prudential) | With-profits | France | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 50 | |
Bank debt instruments held | 443 | 348 |
UK & Europe Operations (M&G Prudential) | With-profits | France | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 369 | |
UK & Europe Operations (M&G Prudential) | With-profits | France | Covered senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 6 | |
UK & Europe Operations (M&G Prudential) | With-profits | France | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 363 | |
UK & Europe Operations (M&G Prudential) | With-profits | France | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 74 | |
UK & Europe Operations (M&G Prudential) | With-profits | France | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 74 | |
UK & Europe Operations (M&G Prudential) | With-profits | Germany | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 324 | 281 |
Bank debt instruments held | 187 | 185 |
UK & Europe Operations (M&G Prudential) | With-profits | Germany | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 179 | |
UK & Europe Operations (M&G Prudential) | With-profits | Germany | Covered senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 116 | |
UK & Europe Operations (M&G Prudential) | With-profits | Germany | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 63 | |
UK & Europe Operations (M&G Prudential) | With-profits | Germany | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 8 | |
UK & Europe Operations (M&G Prudential) | With-profits | Germany | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 8 | |
UK & Europe Operations (M&G Prudential) | With-profits | Netherlands | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 288 | 249 |
UK & Europe Operations (M&G Prudential) | With-profits | Netherlands | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 288 | |
UK & Europe Operations (M&G Prudential) | With-profits | Netherlands | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 288 | |
UK & Europe Operations (M&G Prudential) | With-profits | Other Eurozone | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 33 | 34 |
Bank debt instruments held | 86 | 74 |
UK & Europe Operations (M&G Prudential) | With-profits | Other Eurozone | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 86 | |
UK & Europe Operations (M&G Prudential) | With-profits | Other Eurozone | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 86 | |
UK & Europe Operations (M&G Prudential) | With-profits | UK | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 2,636 | 3,013 |
Bank debt instruments held | 2,124 | 2,096 |
UK & Europe Operations (M&G Prudential) | With-profits | UK | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 1,750 | |
UK & Europe Operations (M&G Prudential) | With-profits | UK | Covered senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 877 | |
UK & Europe Operations (M&G Prudential) | With-profits | UK | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 873 | |
UK & Europe Operations (M&G Prudential) | With-profits | UK | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 374 | |
UK & Europe Operations (M&G Prudential) | With-profits | UK | Tier 1 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 52 | |
UK & Europe Operations (M&G Prudential) | With-profits | UK | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 322 | |
UK & Europe Operations (M&G Prudential) | With-profits | US | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 632 | 1,261 |
Bank debt instruments held | 3,122 | 2,709 |
UK & Europe Operations (M&G Prudential) | With-profits | US | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 2,771 | |
UK & Europe Operations (M&G Prudential) | With-profits | US | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 2,771 | |
UK & Europe Operations (M&G Prudential) | With-profits | US | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 351 | |
UK & Europe Operations (M&G Prudential) | With-profits | US | Tier 1 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 16 | |
UK & Europe Operations (M&G Prudential) | With-profits | US | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 335 | |
UK & Europe Operations (M&G Prudential) | With-profits | Asia | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 127 | 106 |
UK & Europe Operations (M&G Prudential) | With-profits | Asia | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 127 | |
UK & Europe Operations (M&G Prudential) | With-profits | Asia | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 127 | |
UK & Europe Operations (M&G Prudential) | With-profits | Other | ||
Discontinued UK and Europe operations held for distribution | ||
Sovereign debt exposure | 208 | 198 |
Bank debt instruments held | 1,554 | £ 1,616 |
UK & Europe Operations (M&G Prudential) | With-profits | Other | Senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 1,504 | |
UK & Europe Operations (M&G Prudential) | With-profits | Other | Covered senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 506 | |
UK & Europe Operations (M&G Prudential) | With-profits | Other | Other senior debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 998 | |
UK & Europe Operations (M&G Prudential) | With-profits | Other | Subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 50 | |
UK & Europe Operations (M&G Prudential) | With-profits | Other | Tier 1 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | 15 | |
UK & Europe Operations (M&G Prudential) | With-profits | Other | Tier 2 subordinated debt | ||
Discontinued UK and Europe operations held for distribution | ||
Bank debt instruments held | £ 35 |
Discontinued UK and Europe o_12
Discontinued UK and Europe operations held for distribution - Loans portfolio (Details) - GBP (£) £ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Discontinued UK and Europe operations held for distribution | ||
Loans | £ 12,513 | £ 12,443 |
Mortgage loans | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 7,727 | 7,541 |
Policy loans | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 4,702 | 4,634 |
Other loans | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 84 | 268 |
UK & Europe Operations (M&G Prudential) | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 5,535 | 5,567 |
UK & Europe Operations (M&G Prudential) | Mortgage loans | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 3,971 | 4,116 |
UK & Europe Operations (M&G Prudential) | Policy loans | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 3 | 3 |
UK & Europe Operations (M&G Prudential) | Other loans | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 1,561 | 1,448 |
UK & Europe Operations (M&G Prudential) | With-profits | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 3,756 | 3,853 |
UK & Europe Operations (M&G Prudential) | With-profits | Mortgage loans | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 2,260 | 2,461 |
UK & Europe Operations (M&G Prudential) | With-profits | Policy loans | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 3 | 3 |
UK & Europe Operations (M&G Prudential) | With-profits | Other loans | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 1,493 | 1,389 |
UK & Europe Operations (M&G Prudential) | Non-linked shareholder-backed | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 1,779 | 1,714 |
UK & Europe Operations (M&G Prudential) | Non-linked shareholder-backed | Mortgage loans | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | 1,711 | 1,655 |
UK & Europe Operations (M&G Prudential) | Non-linked shareholder-backed | Other loans | ||
Discontinued UK and Europe operations held for distribution | ||
Loans | £ 68 | £ 59 |
Discontinued UK and Europe o_13
Discontinued UK and Europe operations held for distribution - Policyholder liabilities and unallocated surplus of with-profit funds (Details) - GBP (£) £ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Policyholder liabilities on the consolidated statement of financial position | £ 285,168 | |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 2,944 | |
UK & Europe Operations (M&G Prudential) | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 164,889 | £ 181,066 |
Policyholder liabilities on the consolidated statement of financial position | 151,555 | 167,589 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 13,334 | 13,477 |
Reclassification of reinsured UK annuity contracts as held for sale | (12,002) | |
Premiums | 6,266 | 6,964 |
Surrenders | (4,035) | (3,446) |
Maturities/deaths | (3,150) | (3,499) |
Net flows | (919) | 19 |
Shareholders' transfers post-tax | (130) | (127) |
Investment-related items and other movements | 10,832 | (801) |
Foreign exchange translation differences | 48 | 17 |
Ending Balance | 174,720 | 168,172 |
Policyholder liabilities on the consolidated statement of financial position | 159,604 | 154,655 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 15,116 | 13,517 |
Average policyholder liability balances | 155,580 | 161,122 |
UK & Europe Operations (M&G Prudential) | UK and Europe with-profits | With-profits | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 124,129 | 124,699 |
Policyholder liabilities on the consolidated statement of financial position | 110,795 | 111,222 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 13,334 | 13,477 |
Premiums | 5,668 | 6,283 |
Surrenders | (2,462) | (2,246) |
Maturities/deaths | (2,309) | (2,205) |
Net flows | 897 | 1,832 |
Shareholders' transfers post-tax | (130) | (127) |
Switches | (57) | (89) |
Investment-related items and other movements | 8,431 | (476) |
Foreign exchange translation differences | (6) | 17 |
Ending Balance | 133,264 | 125,856 |
Policyholder liabilities on the consolidated statement of financial position | 118,148 | 112,339 |
Unallocated surplus of with-profits funds on the consolidated statement of financial position | 15,116 | 13,517 |
Average policyholder liability balances | 114,472 | 111,781 |
UK & Europe Operations (M&G Prudential) | UK and Europe other funds and subsidiaries | Unit-linked | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 20,717 | 23,145 |
Policyholder liabilities on the consolidated statement of financial position | 20,717 | 23,145 |
Premiums | 447 | 516 |
Surrenders | (1,548) | (1,163) |
Maturities/deaths | (224) | (313) |
Net flows | (1,325) | (960) |
Switches | 57 | 89 |
Investment-related items and other movements | 1,669 | (76) |
Foreign exchange translation differences | 54 | |
Ending Balance | 21,172 | 22,198 |
Policyholder liabilities on the consolidated statement of financial position | 21,172 | 22,198 |
Average policyholder liability balances | 20,945 | 22,671 |
UK & Europe Operations (M&G Prudential) | UK and Europe other funds and subsidiaries | Annuity and other | ||
Analysis of movements in policyholder liabilities and unallocated surplus | ||
Beginning Balance | 20,043 | 33,222 |
Policyholder liabilities on the consolidated statement of financial position | 20,043 | 33,222 |
Reclassification of reinsured UK annuity contracts as held for sale | (12,002) | |
Premiums | 151 | 165 |
Surrenders | (25) | (37) |
Maturities/deaths | (617) | (981) |
Net flows | (491) | (853) |
Investment-related items and other movements | 732 | (249) |
Ending Balance | 20,284 | 20,118 |
Policyholder liabilities on the consolidated statement of financial position | 20,284 | 20,118 |
Average policyholder liability balances | £ 20,163 | £ 26,670 |
Discontinued UK and Europe o_14
Discontinued UK and Europe operations held for distribution - Allowance for credit risk, review of past annuity sales (Details) - UK & Europe Operations (M&G Prudential) £ in Millions | Jun. 30, 2019GBP (£) | Dec. 31, 2018GBP (£) | Jun. 30, 2018GBP (£) | Dec. 31, 2017GBP (£) |
Provision for review of past annuity sales | ||||
Allowance for credit risk | ||||
Gross provision, excluding utilisation | £ 400 | |||
Expected reimbursement | £ 166 | |||
Shareholder-backed | ||||
Allowance for credit risk | ||||
Credit risk allowance | 0.0040 | 0.0040 | 0.0044 | |
Allowance on bond spread over swap rates (as percent) | 21.00% | 22.00% | 26.00% | |
Reserves for credit risk allowance | £ 900 | £ 900 | £ 1,100 | |
Impact of reinsurance on credit risk allowance | £ 12,000 |
Discontinued UK and Europe o_15
Discontinued UK and Europe operations held for distribution - Cash flows (Details) - GBP (£) £ in Millions | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | ||
Discontinued UK and Europe operations held for distribution | |||
Total cash flows in the period | [1] | £ (124) | £ (2,380) |
Cash and cash equivalents at beginning of period | 12,125 | 10,690 | |
Effect of exchange rate changes on cash and cash equivalents | (23) | 31 | |
Cash and cash equivalents at end of period | 9,832 | 8,450 | |
UK & Europe Operations (M&G Prudential) | |||
Discontinued UK and Europe operations held for distribution | |||
Cash flows from operating activities | 404 | (1,711) | |
Cash flows from investing activities | (172) | (224) | |
Cash flows from financing activities | (356) | (445) | |
Total cash flows in the period | (124) | (2,380) | |
Cash and cash equivalents at beginning of period | 4,749 | 5,808 | |
Effect of exchange rate changes on cash and cash equivalents | (1) | (8) | |
Cash and cash equivalents at end of period | 4,624 | 3,420 | |
Net cash remittances into continuing operations | £ 356 | 341 | |
Redemption of subordinated guaranteed bond | £ 104 | ||
[1] | Net cash flows from discontinued operations represents the movement in cash and cash equivalents from the UK and Europe operations, which are classified as held for distribution at 30 June 2019. A detailed analysis of cash flows for the period for the discontinued UK and Europe operations is included in note D2.3. The half year 2018 comparative results have been re-presented from those previously published accordingly (as described in note A2). |