May 10, 2012 - Vincent Cheninsurance.vincent-chen.com/files/ev/2011EV_SamsungLife_EN.pdf · Insurance Co. Ltd. All Right Reserved. | 23p VoNB and NBM 5.8% 1,080 FY2010 1,021 -30 Change

| 1p Copyrightⓒ2011 SAMSUNG Life. Insurance Co. Ltd. All Right Reserved.

FY2011

May 10, 2012


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.


Contents

2011 Financial Performance

2011 Key Highlights

2011 EV Results

2012 Strategic Priorities

Vision 2020

- 3 -

SAMSUNG LIFE INSURANCE

FY2011

Earnings & EV Results


2011 Key Highlights

- 4 -


FY2011



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


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 -


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)


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


7.4%

21.7%


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


2011 Financial Performance

- 10 -


FY2011



APE by Product

- 11 -

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%


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 ]

- 12 -

APE by Channel (Monthly Average)

(KRW billion)

(KRW billion)

(KRW billion)

Exclusive Channel Protection APE (Monthly Average)

9.3%

-4.4%

55.4%


Exclusive Channel Strength

Continued improvement in exclusive channel competitiveness

Net addition of 2,156 agents, 10% improvement in productivity

- 13 -

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


Strong YoY growth in both single premium products and immediate annuity

20% for single premium, 51% for immediate annuity

Single Premium and Immediate Annuity

- 14 -

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)


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)


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)


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


54.7%

22.4%

4.2%

18.7%

Residential

Mortgage

(4.2%)

Top-notch asset quality level among all Korean financial institutions

Asset Quality

- 18 -

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]


Expense / Loss / Persistency Rates

- 19 -

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


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%



FY2011


2011 EV Results

- 21 -


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


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


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 -

| 24p Copyrightⓒ2011 SAMSUNG Life. Insurance Co. Ltd. All Right Reserved. - 24 -

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


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


2012 Strategic Priorities

- 26 -


FY2011



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


FY2012 Targets

- 28 -

APE 10%

( Protection APE 5% +)

10%

7 - 8% 11 - 13%

New Business Growth Earnings Growth

Asset Growth RoEV



FY2011


Vision 2020

- 29 -


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


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



FY2011


Documents

May 10, 2012 - Vincent Cheninsurance.vincent-chen.com/files/ev/2011EV_SamsungLife_EN.pdf · Insurance Co. Ltd. All Right Reserved. | 23p VoNB and NBM 5.8% 1,080 FY2010 1,021 -30 Change