47 Assets analysis.

The Group has categorised its assets and liabilities in the following disclosure in accordance with the level of shareholder exposure to market and credit risks. The four categorisations presented are:

• Unit linked

For unit linked contracts, there is a direct link between the investments and the obligations. Unit linked business is written in both the Society [LTF] and in the LTF of [PMC]. The financial risk on these contracts is borne by the policyholders. The Group is, therefore, not directly exposed to any market risk, currency risk or credit risk for these contracts. Detailed risk disclosures have not been presented for unit linked assets and liabilities.

• With-profits

Policyholders and shareholders share in the risks and returns of the with-profits part of the Society LTF. The return to shareholders on virtually all participating products is in the form of a transfer to shareholders’ equity, which is analogous to a dividend from the Society [LTF] and is dependent upon the bonuses credited or declared on policies in that year. The bonuses are broadly based on historic and current rates of return on equity, property and fixed income securities, as well as expectations of future investment returns. With-profits also includes participating business in the France operation which shares similar characteristics. The with-profits classification excludes unit linked contracts.

• Non profit non-unit linked

Shareholders are exposed to the risk and rewards of ownership of assets backing non profit non-unit linked business held within UK LTFs.

• Shareholder

All other assets are classified as shareholder assets. Shareholders of the Group are directly exposed to market and credit risk on these assets. This includes the assets and liabilities of our overseas insurance operations.

The table overleaf presents an analysis of the balance sheet by category. All of the quantitative risk disclosures in Note 48 (Risk management and control) have been provided using this categorisation.

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As at 31 December 2009	Shareholder £m	Non profit non-unit linked £m	With-profits £m	Unit linked £m	Total £m
1. For risk management purposes, bespoke consolidated CDOs are considered on a net basis. Accordingly, the table above presents derivative liabilities of £118m (2008: £388m) as a deduction to non profit non-unit linked investments and other liabilities.
Assets
Investment in associates	45	–	–	–	45
Plant and equipment	61	–	–	–	61
Investments1	6,906	23,362	19,575	240,544	290,387
Purchased interests in long term business	146	–	–	–	146
Other operational assets	2,580	2,468	260	979	6,287
Total assets	9,738	25,830	19,835	241,523	296,926
Liabilities
Subordinated borrowings	1,897	–	–	(27)	1,870
Participating contract liabilities	–	34	17,218	208	17,460
Non-participating contract liabilities	1,716	22,465	1,953	236,951	263,085
Senior borrowings	1,242	9	40	116	1,407
Other liabilities1	2,525	1,570	577	4,232	8,904
Total liabilities	7,380	24,078	19,788	241,480	292,726
As at 31 December 2008	Shareholder £m	Non profit non-unit linked £m	With-profits £m	Unit linked £m	Total £m
Assets
Investment in associates	14	–	–	–	14
Plant and equipment	75	–	–	–	75
Investments1	7,720	20,589	19,080	201,394	248,783
Purchased interests in long term business	118	109	–	–	227
Other operational assets	2,927	2,405	393	1,515	7,240
Total assets	10,854	23,103	19,473	202,909	256,339
Liabilities
Subordinated borrowings	1,657	–	–	–	1,657
Participating contract liabilities	–	39	16,890	189	17,118
Non-participating contract liabilities	2,514	19,070	1,944	199,011	222,539
Senior borrowings	2,031	29	74	180	2,314
Other liabilities1	2,237	2,761	456	3,525	8,979
Total liabilities	8,439	21,899	19,364	202,905	252,607