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International Insurance Society 44th Annual Seminar

International Insurance Society 44th Annual Seminar. Mark Tucker, Prudential plc, Group Chief Executive July 2008. Strategic Drivers Participation, Competitive, and Organisational Strategy. Shareholder Value. Financial Drivers Growth, Productivity, Risk. Strategic allocation of capital.

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International Insurance Society 44th Annual Seminar

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  1. International Insurance Society44th Annual Seminar Mark Tucker, Prudential plc, Group Chief Executive July 2008

  2. Strategic Drivers Participation, Competitive, andOrganisational Strategy Shareholder Value Financial Drivers Growth, Productivity, Risk Strategic allocation of capital Underpinned by: • Constant evaluation • “Good growth” (RoCE > CoC) • Sustainable earnings NOTE:RoCE - Return on Capital EmployedCoC - Cost of Capital

  3. Two-pronged approach Building a Franchise Managing the Franchise 1 2

  4. Where we have come from The Group today Asset Management Insurance Asia US UK Evolution of the Prudential Group • Driving performance across an international Group • Re-deployment of capital to high growth markets globally • Strong heritage from leadership in UK life and pensions

  5. Building a Franchise: Overview Consistent strategic thinking about business fundamentals

  6. Building a Franchise: Participation Driven by regional growth and stability Life Business Participation Japan South Korea 1992 2000 2008 No Participation China Taiwan Hong Kong Vietnam India Philippines Thailand Malaysia Indonesia Singapore

  7. …leading to results 1,200 277 1,000 266 285 800 243 New Business Value 259 241 600 208 144 400 653 514 418 200 367 0 2004 2005 2006 2007 Asia US UK Building a Franchise: Ambition Disciplined focus on market leadership and profitability Clear ambition… £ million • Recognised as market leader • Market share growth not at expense of profitability

  8. Building a Franchise: Competitive Advantage and CapabilitiesReliance on organic growth on the back of accelerated greenfield acquisitions and JVs Life Business Participation ‘Cold start’ Acquisition of entry vehicle JV No Participation Japan South Korea China Taiwan Hong Kong Vietnam India Philippines Thailand Malaysia Indonesia Singapore

  9. Building a Franchise: Competitive advantage and capabilities Country management aligns business model to local needs • Clearly defined Group ambitions and growth targets • Empowerment of the country CEO to define business strategies within this framework • Inter-regional and inter-Group leverage of expertise and support Federal Management Model Distribution • Strong agency relationships • Innovative bank distribution • Direct sales Business Model Product Participation • Product innovation • Tailored to consumer needs • Consistently striving to meet customer needs with capital efficient solutions Brand • Brand recognition • Striking logo transcends language barriers • Common set of customer friendly values • All based on financial strength and long term commitment to markets

  10. Building a Franchise Market-driven product portfolio management • Consistency between product range and customer proposition • Low cost without sacrificing quality of service • Flexibility

  11. Launching consumer finance • Entering the drawdown space Managing the Franchise Expanding the product portfolio in Asia • Meeting a wider range of customer needs • Assessing current offers in the market

  12. Conclusion • Disciplined capital allocation • Disciplined risk management • Capital adequacy • Returns and growth

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