3 Analysis of shareholders’ equity.

3 Analysis of shareholders’ equity.
(XLS:) European Embedded Value basis – Analysis of shareholders’ equity 2013


As at 31 December 2013

LGAS and LGR
£m

LGIM
£m

LGC and group expenses
£m

LGA
£m

Total
£m

1.

Shareholders’ equity supporting the UK non profit LGAS and LGR businesses is held within Legal & General Assurance Society Limited and Legal & General Pensions Limited and is managed on a groupwide basis within the LGC and group expenses segment.

2.

Free surplus is the value of any capital and surplus allocated to, but not required to support, the in-force covered business at the valuation date.

3.

Value of in-force business includes a deduction for the time value of options and guarantees of £23m (2012: £30m).

Analysed as:

 

 

 

 

 

IFRS basis shareholders’ equity1

783

421

3,622

816

5,642

Additional retained profit/(loss) on an EEV basis

4,830

(1,003)

117

3,944

Shareholders’ equity on an EEV basis

5,613

421

2,619

933

9,586

 

 

 

 

 

 

Comprising:

 

 

 

 

 

Business reported on an IFRS basis

408

421

(630)

199

Business reported on an EEV basis:

 

 

 

 

 

Shareholder net worth

 

 

 

 

 

– Free surplus2

67

 

1,107

192

1,366

– Required capital to cover solvency margin

248

 

2,142

42

2,432

Value of in-force

 

 

 

 

 

– Value of in-force business3

5,398

 

 

711

6,109

– Cost of capital

(508)

 

 

(12)

(520)

(XLS:) European Embedded Value basis – Analysis of shareholders’ equity 2012


As at 31 December 2012

LGAS and LGR
£m

LGIM
£m

LGC and group expenses
£m

LGA
£m

Total
£m

1.

Shareholders’ equity supporting the UK non profit LGAS and LGR businesses is held within Legal & General Assurance Society Limited and Legal & General Pensions Limited and is managed on a groupwide basis within the LGC and group expenses segment.

2.

Free surplus is the value of any capital and surplus allocated to, but not required to support, the in-force covered business at the valuation date.

3.

Value of in-force business includes a deduction for the time value of options and guarantees of £30m.

Analysed as:

 

 

 

 

 

IFRS basis shareholders’ equity1

685

423

3,414

919

5,441

Additional retained profit/(loss) on an EEV basis

4,484

(1,080)

55

3,459

Shareholders’ equity on an EEV basis

5,169

423

2,334

974

8,900

 

 

 

 

 

 

Comprising:

 

 

 

 

 

Business reported on an IFRS basis

325

423

(844)

(96)

Business reported on an EEV basis:

 

 

 

 

 

Shareholder net worth

 

 

 

 

 

– Free surplus2

57

 

1,202

206

1,465

– Required capital to cover solvency margin

239

 

1,976

33

2,248

Value of in-force

 

 

 

 

 

– Value of in-force business3

5,054

 

 

745

5,799

– Cost of capital

(506)

 

 

(10)

(516)

Further analysis of shareholders’ equity is included in Note 4.

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