LEGAL & GENERAL GROUP PLC | YEAR END RESULTS | MARCH 2016 200% - PowerPoint PPT Presentation

LEGAL & GENERAL GROUP PLC | YEAR END RESULTS | MARCH 2016

200% 6.3% (7.7%) 190% 2.5% 8.2% 180% 188% 170% 180% 160% 171% 150% 140% 130% 120% 110% 100% YE 2016 Solvency II net Cofunds and Debt raise 15 May 2017 Final 2016 15 May 2017 shareholder surplus Netherlands & call shareholder dividend (not shareholder basis generated YTD disposals basis coverage yet approved basis coverage Solvency II ratio* or paid)** ratio excl. coverage ratio dividend* • • • • •

The SFCR summary What is new? • • •    •  •   •  Draws heavily on existing Report & Accounts

• • • • • Key SFCR references Balance Sheet - S.02 Surplus Own funds Assets • S.23 S.02 SCR – S.25 Other Liabilities S.02 Technical Provisions S.02 S.12 S.17 S.22

Regulatory 31 December 2016 (£m) SFCR reference basis SII value of total assets SII value of total liabilities SII excess of assets over liabilities Subordinated debt SII restriction on Own Funds for non-insurance participations SII Own Funds Group Solvency Capital Requirement Group Solvency II surplus Regulatory Capital coverage ratio • •

Add back Change in Solvency II Shareholder Pension TMTP (incl. 1 Other Regulatory SFCR 31 December 2016 (£m) basis Scheme and year adjustments basis reference WPSF amortisation) Core Tier 1 11,038 726 (284) 15 11,495 E.1.3 Other Tier 1 608 - - - 608 E.1.3 Tier 2 2,108 - - - 2,108 E.1.3 Deductions (142) - - - (142) E.1.3 Own Funds 13,612 726 (284) 15 14,069 S.23.01.22 Capital Requirement 7,947 726 0 (38) 8,635 S.25.02.22 Surplus 5,665 0 (284) 53 5,434 Coverage ratio (%) 171 (6) (3) 1 163 • • •

Differences explained by Consolidation Held for sale Conversion to Solvency II approach £m under IFRS £m D&A method £m valuation Total differences £m £m Section D.Note 1 Section D.Note 2 Section D.Note 3 Section D.Note 4 IFRS equity 7,283 Difference in assets (62,054) (54,836) 41 (4,595) (2,664) Difference in Technical 10,722 - (1,709) 3,404 9,027 Provisions Difference in other liabilities 55,544 54,489 1,715 688 (1,348) Total difference in assets and 4,212 (347) 47 (503) 5,015 liabilities Solvency II excess of assets 11,495 over liabilities • Subordinated debt 2,716 Basic Own Funds 14,211 Solvency II restrictions (142) • Eligible Own Funds 14,069 • •

Solvency II PMC SFCR LGAS LGI 31 December 2016 (£m) (part of LGIM) reference Own Funds 11,630 664 253 S.23.01 Solvency Capital Requirement 7,544 270 162 S.25.02 Surplus 4,086 394 91 Coverage ratio (%) 154% 246% 156% • • Subsidiaries show strong standalone capital positions

• SFCR US Jurisdiction D&A position £m reference D&A Own Funds (excl. restriction) 442 S.23.01.22 • D&A SCR 198 S.25.02.22 Surplus 244 £500m • £400m Own Funds • > 250% 244 £300m 228 £442m Own Funds (excl. £200m restriction) Own • 250% Funds 17 73 CAL > 200% 29 £100m 198 200% CAL 109 88 £0m Banner Life US Captive Total

Impact of Solvency II Regulatory SFCR removing Without TMTP 31 December 2016 (£m) View reference TMTP Technical Provisions 382,753 6,687 389,440 S22.01.22 Eligible Own Funds 14,069 (5,651) 8,418 S22.01.22 Solvency Capital Requirement 8,635 930 9,565 S22.01.22 Surplus 5,434 (6,581) (1,147) Coverage ratio (%) 163% (75)% 88% D.2.1.4 • • • • •

Impact of Solvency II Regulatory removing SFCR Without MA 31 December 2016 (£m) View Matching reference Adjustment Technical Provisions 382,753 8,343 391,096 S22.01.22 Eligible Own Funds 14,069 (7,067) 7,002 S22.01.22 Solvency Capital Requirement 8,635 9,560 18,195 S22.01.22 Surplus 5,434 (16,627) (11,193) Coverage ratio (%) 163% (125)% 38% D.2.1.6 • • •

LEGAL & GENERAL GROUP PLC | YEAR END RESULTS | MARCH 2016