M&G PLC IFRS 17 Market Update (8951I)
07 Décembre 2022 - 3:30PM
UK Regulatory
TIDMMNG
RNS Number : 8951I
M&G PLC
07 December 2022
M&G plc
IFRS 17 Market Update
M&G plc ("M&G") has today released an update on its
approach to IFRS 17; a global insurance accounting standard due to
be implemented on 1 January 2023. The material is available on
M&G's website at the following link (Results, reports and
presentations - M&G plc (mandgplc.com)) and a summary of key
points is set out below.
The implementation of IFRS 17 will not change M&G's
strategy, solvency position, capital management framework, or
dividend policy. M&G remains committed to achieving its core
financial target of generating GBP2.5 billion Operating Capital
over the 2022-2024 three-year period.
On transitioning to IFRS 17, M&G expects its IFRS
Shareholder Equity to increase due to the notional attribution to
shareholders of c. 10% of the With-Profits fund IFRS surplus. This
positive impact on Shareholder Equity is expected to more than
offset the negative one driven by the creation of the Contractual
Service Margin (CSM) in the annuity business.
The increase in IFRS Shareholder Equity is expected to
proportionately reduce the IFRS leverage ratio, while the Solvency
II leverage ratio will not be affected by the change.
IFRS 17 will change the profit signature of the With-Profits
business (including PruFund), as earnings will no longer be
back-end loaded, but spread through the life of the product.
IFRS 17 will also remove the volatility related to assumption
changes (e.g. longevity) from the Annuities Adjusted Operating
Profit (AOP) result. These assumption changes will be absorbed by
the CSM and gradually fed through to AOP over time.
M&G will provide a further update on IFRS 17 to the market
in June 2023, ahead of publishing its first set of IFRS 17
financial statements at its 2023 Half Year Results.
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END
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