Prudential (PRU) Investor Update summary

Capital Return and Capital Management Framework

• Announced a $2 billion share buyback to be completed by mid-2026, representing about 8% of outstanding stock, enabled by a strong capital base and clarified rating agency treatment of IFRS 17 CSM.

• Free surplus ratio stood at 242% at end-2023, well above the 175%-200% target range; buyback will reduce the ratio to just above 200%.

• Dividend policy remains unchanged, with 2024 annual dividend growth expected at 7%-9%.

• Comfortable leverage headroom remains after the buyback, with a pro forma Moody’s leverage ratio of 15% and over $2 billion in additional debt capacity.

• Capital above the operating range will be returned to shareholders, considering reinvestment opportunities and market conditions.

Strategic Priorities and Growth Outlook

• Confident in achieving full-year 2024 new business growth and 2027 financial and strategic objectives, including 15%-20% CAGR in new business profit and double-digit CAGR in operating free surplus.

• Focus remains on organic growth, capability enhancement, and selective, in-country bancassurance partnerships for diversification.

• $1 billion investment program targets distribution, technology, and health, with $130 million deployed in 2023 and $250-$300 million planned for 2024.

• New business profit grew from $2.2 billion in 2022 to $3.1 billion in 2023, targeting $5.4 billion by 2027.

• Gross operating free surplus generation (OFSG) expected to exceed $4.4 billion by 2027.

Financial Metrics and Guidance

• Free surplus stock at $8.5 billion at end-2023; group free surplus plus EV required capital divided by EV required capital defines the free surplus ratio.

• No change to operating free surplus generation (OFSG) targets despite the buyback; funding is from Holdco cash and does not impact gross OFSG.

• Dividend growth guidance is on a nominal basis, not per share, with flexibility to adjust capital returns based on market conditions.

• Required capital for free surplus ratio is based on EEV, with no material change expected if TEV is adopted.

• Intangibles, including future bancassurance partnership assets, are excluded from capital calculations to focus on deployable capital.