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FY2011
May 10, 2012
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Disclaimers
- 2 -
The financial information contained herein has not been completely reviewed by our external
auditor. Therefore, no assurance is provided that our financial statements are fully accurate, and
thus our final reviewed statements may differ from the figures provided in this presentation.
This presentation may include forward-looking statements that reflect prevailing conditions and
the views of management as of the date hereof, all of which are subject to change.
Forward-looking statements are based on a number of estimates and current assumptions which
are subject to business, economic and competitive uncertainties and contingencies as well as
various risks and these may change over time and in many cases are beyond the control of the
Company. No assurance can be given that future events will occur, that the forward-looking
statements will be achieved, or that the Company's assumptions are correct.
Accordingly, actual results may differ materially from those contemplated
by the forward-looking statements.
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Contents
2011 Financial Performance
2011 Key Highlights
2011 EV Results
2012 Strategic Priorities
Vision 2020
- 3 -
SAMSUNG LIFE INSURANCE
FY2011
Earnings & EV Results
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2011 Key Highlights
- 4 -
SAMSUNG LIFE INSURANCE
FY2011
Earnings & EV Results
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Financial Highlights
- 5 -
I/S
Summary
B/S
Summary
(KRW billion) FY2011 FY2010 YoY
A P E 3,905 3,526 10.7%
Protection APE 1,763 1,626 8.4%
Net Profit 948 1,570 -39.6%
Total Assets 161,072 146,903 9.6%
Shareholder’s Equity 18,113 15,754 15.0%
RBC Ratio1 386% 332% 54%p
EV
Summary
Embedded Value 23,741 21,433 10.8%
Value of New Business 1,080 1,021 5.8%
New Business Margin 27.7% 29.0% -1.3%p
1) RBC for FY2010 (332%) is based on pre-IFRS figures
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2011 Key Accomplishments
New Business
Growth
• Achieved differentiated new business growth
focused on protection products
Distribution
Channel
• Accomplished balanced growth between exclusive
and non-exclusive channels
Organization • Corporate reorganization for execution of
growth strategy
- 6 -
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Differentiated New Business Growth
- 7 -
3,526
3,905
FY2010 FY2011
10.7%
1,626
1,763
FY2010 FY2011
8.4%
New Business APE Protection APE
(KRW billion) (KRW billion)
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Balanced Channel Growth
- 8 -
2,703
2,902
FY2010 FY2011
9,878
8,238
824
1,003
FY2010 FY2011
Exclusive Channel APE Non-exclusive Channel APE
(KRW billion) (KRW billion)
7.4%
21.7%
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Corporate Reorganization
- 9 -
Revitalize
Company
Strengthen
Sales Channel
Support
New Business
• Complete reorganization
of senior management
• Large-scale repositioning
of key sales managers
• Streamlined workforce
• Exclusive channel
- Additional regional HQ
created in Seoul Metro area
(from 7 to 8)
• Non-exclusive channel
- Elevated leadership position
from SVP to Executive VP
- Increased BA relations
managers and GA support staff
• New exclusive platform for
Ultra HNWIs
- “Samsung Family Office”
• New business development
team under CEO
- “New Business Taskforce”
exploring M&A opportunities
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2011 Financial Performance
- 10 -
SAMSUNG LIFE INSURANCE
FY2011
Earnings & EV Results
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APE by Product
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135 147
138
146
21
32
FY2010 FY2011
Protection Annuity Savings
294
6.1%
325
· Lifetime Financial Planning Features of Whole-life
Profitable growth through protection (death benefit) products
Monthly Average APE
(KRW billion)
Pre-retirement Post-
retirement
Funds needed during
breadwinner’s lifetime
Post-retirement
medical / living
expenses
Fund needed by surviving family
in case of breadwinner’s death
Funds for
Inheritance tax
P&Cs : Max KRW 200M cap on death benefit
Limited to term-life death benefit up to age 80
10.7%
8.4%
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118
129
FY2010 FY2011
20 19
FY2010 FY2011
[ Bancassurance ]
19
30
FY2010 FY2011
APE by Channel
Protection growth through exclusive channel,
Annuity growth through general agencies
225 242
69
84
FY2010 FY2011
Exclusive Non-exclusive
7.4%
21.7%
294
325 10.7%
Non-Exclusive Channel Annuity APE (Monthly Average)
[ GA ]
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APE by Channel (Monthly Average)
(KRW billion)
(KRW billion)
(KRW billion)
Exclusive Channel Protection APE (Monthly Average)
9.3%
-4.4%
55.4%
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Exclusive Channel Strength
Continued improvement in exclusive channel competitiveness
Net addition of 2,156 agents, 10% improvement in productivity
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3.7 4.2
FY2010 FY2011
Per-FC Protection APE
7.1
7.8
1) FCs earning more than KRW 5M in monthly commissions
29,778
31,934
(FCs)
Monthly Average APE Exclusive Agent Force
1
(KRW million)
+2,156 10%
14%
5,754 6,414
FY2010 FY2011
High-performing FCs
+660
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Strong YoY growth in both single premium products and immediate annuity
20% for single premium, 51% for immediate annuity
Single Premium and Immediate Annuity
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Single Premium (Monthly Average)
Immediate Annuity (Monthly Average)
[ Total ] [ Annuity ]
(KRW billion)
149
186
FY2010 FY2011
116
139
FY2010 FY2011
20% 25%
45
68
FY2010 FY2011
51%
(KRW billion)
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Large-sum Premium
Robust YoY growth in HNW segment
13% for monthly premiums, 31% for single premiums
- 15 -
FY2009 FY2010 FY2011
100M-500M 500M-1B 1B+
71
104
136
FY2009 FY2010 FY2011
2M-5M 5M-10M 10M+
3,118
3,705
4,184
KRW 100M+ Single Premium (Monthly Average)
KRW 2M+ Monthly Premium (Monthly Average)
(KRW million) (KRW billion)
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Corporate Pension
Sustained growth and leadership in corporate pension
- 16 -
H
W
S
K
SLI
14.5%
8.9%
8.7%
8.1%
6.4%
4,776
7,521
FY2010 FY2011
Corporate Pension Reserves Market Share
(KRW billion)
Source : FSS Corporate Pension Statistics (Mar 2012)
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Steady asset growth adhering to ALM strategy
Investment Portfolio
- 17 -
1) Excludes net valuation gains and losses on AFS securities
FY11 Investment Yield : 4.7%
FY11 Adjusted Investment Yield: 5.4%
Bonds Loans
19%
Equities
14%
58%
Cash &
Equivalents 2% Real Estate 4%
Beneficiary
Certificates 3% [ Total Assets ] [ Invested Assets ]
Asset Growth Portfolio and Yield
(KRW trillion)
1
147
161
FY2010 FY2011
119
130
FY2010 FY2011
130
trillion
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54.7%
22.4%
4.2%
18.7%
Residential
Mortgage
(4.2%)
Top-notch asset quality level among all Korean financial institutions
Asset Quality
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1) LTV for residential mortgage loan currently at 41%
Parentheses denote share of entire investment portfolio
NPL Ratio : 0.32%
Corporate
(3.5%)
Household
Credit
(0.8%)
1
Policy (10.2%)
Bond Portfolio
24.3
trillion
Loan Portfolio
42.1%
38.5%
5.4%
12.2%
1.8%
Risk Free AAA AA A BBB↓
Credit ratings for KRW denominated bonds from Korean agencies
Risk Free : treasury, monetary stabilization bonds, etc.
[Total : KRW 75.4 trillion]
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Expense / Loss / Persistency Rates
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84.3% 86.7%
FY2010 FY2011
Expense rate = actual expense / total premium
Loss rate = claims paid / risk premium
15.4%
15.1%
FY2010 FY2011
Continued improvement in expense rate and persistency rates
Expense Rate
Loss Rate
Persistency Rates
Figures based on premiums
84.7% 85.2%
86.7%
87.9%
67.6% 66.8%
69.6% 70.0%
1Q FY11 2Q 3Q 4Q
13th month 25th month
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Profit and Capital
- 20 -
Net profit of KRW 948 billion, RBC ratio of 386%
RBC Ratio Net Profit
(KRW billion) (KRW trillion)
1,570
948
FY2010 FY2011
RBC for FY2010 is based on pre-IFRS figures
6.7 6.5
3.3 3.2
12.1 15.3
FY2010 FY2011
Required Capital (100%) Required Capital (150%) Surplus
386%
332%
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SAMSUNG LIFE INSURANCE
FY2011
Earnings & EV Results
2011 EV Results
- 21 -
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FY2011 Embedded Value Summary
- 22 -
FY2011 EV : KRW 23.7 trillion, RoEV : 13.9%1, VoNB up by 5.8%
1) RoEV based on FY2011 EV results before dividends and share repurchase conducted in 2011
- shareholder dividends of KRW 394 bn, share repurchase of KRW 276 bn
2) FY2010 EV has been restated to reflect changes in the corporate tax rate and RBC regulation
Embedded Value Value of New Business
(KRW billion) (KRW billion)
16,392
18,293
5,041
5,448
FY2010 FY2011
ANW VIF
21,433
23,741
2
5.8%
1,021
1,080
FY2010 FY2011
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VoNB and NBM
5.8%
1,080
FY2010
1,021
-30
Change in
NIER 1
assumption
FY2011
-29
Change in
actuarial
assumptions
1,139
FY2011
(before assumption
changes)
29.0%
27.7%
Change in
corporate
tax rate
-0.5%
Changes in
product mix and
assumptions
-0.8%
FY2011 FY2010
NBM Movement VoNB Movement
1) NIER (Net Investment Earnings Rate) : assumed investment yield for EV calculation
(KRW billion)
- 23 -
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21,325
1,545
1,080
-670
23,741
FY2010 Restated FY2011 FY2010
21,433
ROEV 13.9%
24,411
108
Change
from
IFRS
adoption
VoNB
Unwind
Variance Changes in
assumptions
Share
repurchase &
dividends
(KRW billion)
EV Movement Analysis
-1,141 1,494
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Key Assumptions
- 25 -
Discount Rate
Maintenance Expense assumed to rise at the rate of inflation : 3% per annum
Operating Expense: used actual operating expense incurred for FY2011
Corporate tax rate: 24.2% (for FY2010 EV calculation, 22% was assumed for
FY2012 and thereafter)
10.5%
5.0% (for FY2010 EV calculation, NIER assumed was 5.2%)
Capital needed to attain a 150% RBC ratio under Korea’s RBC regulation
Based on 7 year historical experience data by coverage type
Based on 7 year historical experience data
NIER (Net Investment
Earnings Rate)
Lapse &
Surrender
Rates
Loss Rate
Required
Capital
Other
Assumptions
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2012 Strategic Priorities
- 26 -
SAMSUNG LIFE INSURANCE
FY2011
Earnings & EV Results
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FY2012 Strategic Priorities
- 27 -
Solidify market
presence
Develop new
growth drivers
Shareholder
focused
management
• Gain traction in HNW market
• Expand overseas business
• Establish stable earnings generation
• Efficient capital management
• Secure product competitiveness
• Increase exclusive agents (2,000+)
• Improve non-exclusive channel competitiveness
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FY2012 Targets
- 28 -
APE 10%
( Protection APE 5% +)
10%
7 - 8% 11 - 13%
New Business Growth Earnings Growth
Asset Growth RoEV
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SAMSUNG LIFE INSURANCE
FY2011
Earnings & EV Results
Vision 2020
- 29 -
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Business Concept
Redefining our Business, Vision, and Values
Nurturing people with greater love
to build better financial security
A Global life partner focused on its customers Vision
Core Values
- 30 -
Customer
People
Professional
Challenge
Communication
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Strengthen
domestic business
Samsung Life in 2020
- 31 -
KRW 500 trillion in Total Assets
Strategy
Key
Domains
Target
Protection market
Retirement market
HNW market
Overseas market
(KRW 150 trn, 30%) Asset management
Diversification Develop future
growth market
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SAMSUNG LIFE INSURANCE
FY2011
Earnings & EV Results