Schedule I — Condensed Financial Information of Registrant Condensed Statements of Operations (Parent Company Only) | |||||||||||
December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
Revenues | (in millions) | ||||||||||
Management and financial advice fees | $ | 4 | $ | 1 | $ | — | |||||
Distribution fees | 1 | — | 9 | ||||||||
Net investment income | 33 | 29 | 18 | ||||||||
Other revenues | 7 | 9 | 30 | ||||||||
Total revenues | 45 | 39 | 57 | ||||||||
Banking and deposit interest expense | — | 3 | — | ||||||||
Total net revenues | 45 | 36 | 57 | ||||||||
Expenses | |||||||||||
Benefits, claims, losses and settlement expenses | 19 | — | — | ||||||||
Distribution expenses | — | (5 | ) | 5 | |||||||
Interest and debt expense | 123 | 94 | 95 | ||||||||
General and administrative expense | 221 | 255 | 223 | ||||||||
Total expenses | 363 | 344 | 323 | ||||||||
Pretax loss before equity in earnings of subsidiaries | (318 | ) | (308 | ) | (266 | ) | |||||
Income tax benefit | (85 | ) | (104 | ) | (102 | ) | |||||
Loss before equity in earnings of subsidiaries | (233 | ) | (204 | ) | (164 | ) | |||||
Equity in earnings of subsidiaries excluding discontinued operations | 1,570 | 1,235 | 1,340 | ||||||||
Net income from continuing operations | 1,337 | 1,031 | 1,176 | ||||||||
Loss from discontinued operations, net of tax | (3 | ) | (2 | ) | (60 | ) | |||||
Net income | $ | 1,334 | $ | 1,029 | $ | 1,116 | |||||
See Notes to Condensed Financial Information of Registrant. |
Schedule I — Condensed Financial Information of Registrant Condensed Statements of Comprehensive Income (Parent Company Only) | |||||||||||
December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in millions) | |||||||||||
Net income | $ | 1,334 | $ | 1,029 | $ | 1,116 | |||||
Other comprehensive income (loss), net of tax: | |||||||||||
Foreign currency translation adjustment | 12 | 21 | (2 | ) | |||||||
Net unrealized gains (losses) on securities: | |||||||||||
Net unrealized securities gains (losses) arising during the period | (971 | ) | 588 | 376 | |||||||
Reclassification of net securities gains included in net income | (5 | ) | (5 | ) | — | ||||||
Impact on deferred acquisition costs, deferred sales inducement costs, benefit reserves and reinsurance recoverables | 319 | (154 | ) | (193 | ) | ||||||
Total net unrealized gains (losses) on securities | (657 | ) | 429 | 183 | |||||||
Net unrealized gains (losses) on derivatives: | |||||||||||
Net unrealized derivative gains (losses) arising during the period | — | 10 | (7 | ) | |||||||
Reclassification of net derivative losses (gains) included in net income | 1 | (1 | ) | (22 | ) | ||||||
Total net unrealized gains (losses) on derivatives | 1 | 9 | (29 | ) | |||||||
Defined benefit plans: | |||||||||||
Prior service credit | (1 | ) | (1 | ) | (1 | ) | |||||
Net income (loss) arising during the period | 46 | (15 | ) | (50 | ) | ||||||
Total defined benefit plans | 45 | (16 | ) | (51 | ) | ||||||
Total other comprehensive income (loss), net of tax | (599 | ) | 443 | 101 | |||||||
Total comprehensive income | $ | 735 | $ | 1,472 | $ | 1,217 | |||||
See Notes to Condensed Financial Information of Registrant. |
Schedule I — Condensed Financial Information of Registrant Condensed Balance Sheet (Parent Company Only) | |||||||
December 31, | |||||||
2013 | 2012 | ||||||
(in millions, except share amounts) | |||||||
Assets | |||||||
Cash and cash equivalents | $ | 925 | $ | 900 | |||
Investments | 743 | 894 | |||||
Loans to subsidiaries | 457 | 467 | |||||
Due from subsidiaries | 416 | 225 | |||||
Receivables | 64 | 12 | |||||
Land, buildings, equipment, and software, net of accumulated depreciation of $805 and $756, respectively | 250 | 251 | |||||
Investments in subsidiaries | 7,652 | 8,200 | |||||
Other assets | 1,224 | 1,350 | |||||
Total assets | $ | 11,731 | $ | 12,299 | |||
Liabilities and Shareholders’ Equity | |||||||
Liabilities: | |||||||
Accounts payable and accrued expenses | $ | 191 | $ | 198 | |||
Due to subsidiaries | 405 | 330 | |||||
Debt | 2,720 | 2,403 | |||||
Other liabilities | 560 | 612 | |||||
Total liabilities | 3,876 | 3,543 | |||||
Shareholders’ Equity: | |||||||
Common shares ($.01 par value; shares authorized, 1,250,000,000; shares issued, 316,816,851 and 309,399,529, respectively) | 3 | 3 | |||||
Additional paid-in capital | 6,929 | 6,503 | |||||
Retained earnings | 7,289 | 6,381 | |||||
Treasury shares, at cost (124,698,544 and 105,456,535 shares, respectively) | (6,961 | ) | (5,325 | ) | |||
Accumulated other comprehensive income, net of tax, including amounts applicable to equity investments in subsidiaries | 595 | 1,194 | |||||
Total shareholders’ equity | 7,855 | 8,756 | |||||
Total liabilities and equity | $ | 11,731 | $ | 12,299 | |||
See Notes to Condensed Financial Information of Registrant. |
Schedule I — Condensed Financial Information of Registrant Condensed Statements of Cash Flows (Parent Company Only) | |||||||||||
December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in millions) | |||||||||||
Cash Flows from Operating Activities | |||||||||||
Net income | $ | 1,334 | $ | 1,029 | $ | 1,116 | |||||
Equity in earnings of subsidiaries excluding discontinued operations | (1,570 | ) | (1,235 | ) | (1,340 | ) | |||||
Loss from discontinued operations, net of tax | 3 | 2 | 60 | ||||||||
Dividends received from subsidiaries | 1,163 | 1,366 | 1,210 | ||||||||
Other operating activities, primarily with subsidiaries | (34 | ) | 197 | (231 | ) | ||||||
Net cash provided by operating activities | 896 | 1,359 | 815 | ||||||||
Cash Flows from Investing Activities | |||||||||||
Available-for-Sale securities: | |||||||||||
Proceeds from sales | 2 | — | — | ||||||||
Maturities, sinking fund payments and calls | 191 | 30 | 239 | ||||||||
Purchases | (109 | ) | — | (22 | ) | ||||||
Proceeds from sale of other investments | 43 | 1 | — | ||||||||
Purchase of other investments | (1 | ) | (55 | ) | — | ||||||
Purchase of land, buildings, equipment and software | (54 | ) | (38 | ) | (56 | ) | |||||
Contributions to subsidiaries | (106 | ) | (131 | ) | (128 | ) | |||||
Return of capital from subsidiaries | 470 | 347 | 22 | ||||||||
Proceeds from sale of business | — | — | 150 | ||||||||
Repayment of loans from subsidiaries | 1,420 | 1,150 | 1,252 | ||||||||
Issuance of loans to subsidiaries | (1,412 | ) | (994 | ) | (1,312 | ) | |||||
Other, net | 20 | (16 | ) | 2 | |||||||
Net cash provided by investing activities | 464 | 294 | 147 | ||||||||
Cash Flows from Financing Activities | |||||||||||
Dividends paid to shareholders | (401 | ) | (305 | ) | (212 | ) | |||||
Repurchase of common shares | (1,583 | ) | (1,381 | ) | (1,495 | ) | |||||
Cash paid for purchased options with deferred premiums | (4 | ) | — | — | |||||||
Cash received for purchased options with deferred premiums | 23 | — | — | ||||||||
Issuances of debt, net of issuance costs | 744 | — | — | ||||||||
Repayments of debt | (350 | ) | — | (14 | ) | ||||||
Exercise of stock options | 118 | 160 | 66 | ||||||||
Excess tax benefits from share-based compensation | 120 | 64 | 90 | ||||||||
Other, net | (2 | ) | (3 | ) | (1 | ) | |||||
Net cash used in financing activities | (1,335 | ) | (1,465 | ) | (1,566 | ) | |||||
Net increase (decrease) in cash and cash equivalents | 25 | 188 | (604 | ) | |||||||
Cash and cash equivalents at beginning of year | 900 | 712 | 1,316 | ||||||||
Cash and cash equivalents at end of year | $ | 925 | $ | 900 | $ | 712 | |||||
Supplemental Disclosures: | |||||||||||
Interest paid on debt | $ | 129 | $ | 139 | $ | 139 | |||||
Income taxes paid, net | 354 | 170 | 334 | ||||||||
Non-cash capital transactions from subsidiaries | — | — | (850 | ) | |||||||
Non-cash financing activity: | |||||||||||
Dividends declared but not paid | — | — | 62 | ||||||||
See Notes to Condensed Financial Information of Registrant. |