Total Group-wide experience and operating assumption changes were negative £975m (2007: negative £22m) on an [IFRS] basis and negative £137m (2007: negative £162m) on the [EEV] basis.
The most significant assumption change relates to additional credit default reserving (discussed at Significant Events). Following regular review of the weighted average cost of capital (‘WACC’) which underpins the risk discount rate used in our valuation, we have increased the risk margin in the risk discount rate by 1.5%, giving a total margin of 4.5% to reflect additional investment market risks. This reduces EEV shareholders’ funds by £725m, or 12.4p per share, and reduces reported new business margins.