Prudential PLC
LSE:PRU
Earnings Call Analysis
Q1-2023 Analysis
Prudential PLC
The company has displayed its capability to not only regain but also cement its leadership position in the Mainland Chinese visitor segment, a pivotal driver for its Hong Kong market. Despite geopolitical tensions and the looming shadow of a global pandemic, the company exudes confidence in the Hong Kong market, buoyed by an increasing footfall of visitors nearing pre-pandemic levels and a GDP growth projection hovering between 4% to 5%. With a forward-looking stance, the executives anticipate sustained expansion into the third quarter, which paints a promising picture for stakeholders invested in the company's Hong Kong operations.
Through intricate multi-channel strategies, encapsulating agency and bancassurance, the company's two-thirds contribution to Hong Kong's New Business Profit (NBP) by the Mainland Chinese visitors flags its towering presence in the region. Beyond this, the domestic market's performance also provides a testament to the company's ingrained strength and effective distribution network. This potent combination reinforces the company's resilience and its capability to nurture and leverage strong customer relationships.
With margins on an upward trajectory, the company has reported a hike from 65% in the first quarter to 75% ex-economic basis, signaling a strong profit outlook. Health and protection policies have shown an uptick, demonstrating the company's agility in adapting to market normalization. This segment's contribution has bolstered overall policy growth, indicating potential for future margin enhancement as the health and protection segment is expected to rise in prominence over the ensuing quarters.
The company doesn't shy away from a diversified approach, which is reflected in the varied geographic mix of its Mainland China Visitor (MCV) business. With over 70% of MCV volume coming from outside the Greater Bay Area (GBA), the company prides itself on not being overly reliant on any single region within China, thereby minimizing risks. The management aims to replicate such diversification across its portfolio as well as balance its product mix, even if that entails short-term volume and value impacts, underscoring a commitment to long-term sustainable growth.
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Good afternoon to you in Hong Kong. Good morning elsewhere in the world. It's Patrick Bowes speaking. Thank you for joining us today. In the interest of ruthless efficiency and operating rhythm, we're going to start at exactly 4:30 Hong Kong time. Thank you very much.
I'll pass over to Charlie, our operator for today.
Thank you. Good morning and welcome to the Prudential Half Year Results 2023 [ph] live Q&A. My name is Charlie and I'll be coordinating the call today. [Operator Instructions] I will now hand over to our host, Anil Wadhwani, Chief Executive Officer, to begin. Anil, please go ahead.
Thank you, operator and thank you, Patrick. Good morning, good afternoon, everyone and a very, very warm welcome to the half yearly results for 2023. I'm Anil Wadhwani. I have taken over the role as Prudential plc's CEO over the last 6 months and I'm delighted to be sharing both the first half results as well as the update on our new strategy.
Right at the outset, we are very pleased with the exceptionally strong performance that we have been able to communicate and delivered in the first half of this year. Our new business profit touched $1.5 billion, registering a growth year-on-year of 39%. And if you were to remove the impacts of interest rate, our growth was even stronger at 52%. Importantly, our margins were resilient and our margins came in at 49% on an overall basis which was more or less flattish to the same time last year. And if, again, you remove the impact of interest rate, our margins improved by 4 percentage points. This was largely driven on account of the strong sales growth. Our sales were in excess of $3 billion, again, a very strong growth of 42% year-on-year. This was underpinned by a strong performance by agency. Agency volumes doubled. And again, this was on the back of the last set of COVID restrictions going away.
We have a very strong bancassurance channel that complemented our agency very well and delivered sales in excess of $1 billion for the first half of this year. Hong Kong led our performance but we also witnessed growth in new business profit in 10 out of our 13 Asian markets and all our African markets delivered sales growth. So indeed, very excited and very pleased with the set of results that we have announced today.
We, at the same time, launched our new strategy. And our new strategy is a promise to accelerate value creation for all our stakeholders, our customers, our people, our shareholders and, importantly, our community. The strength of our strategy lies in its simplicity. And we believe that the focus that we are driving on both operational and financial discipline will be key to driving sustainable value creation between now and 2027. We are also using our newly launched purpose to give us the inspiration and the guiding force as we write the next chapter of growth at Prudential.
We have shared 2 financial targets: firstly, 15% to 20% new business profit growth CAGR, on a CAGR basis between now and 2027; and second, accelerating our free surplus generation to double digit during the same time period. And both are going to be driven by the 3 strategic pillars of customer, technology-driven distribution and scaling of our health business. And they are going to be enabled by 3 enablers: our open architecture technology platform, our people and our wealth and investment capabilities. So we are very excited about the future that we are just about to create. And as I said, it's a pleasure to be hosting you this morning, this afternoon.
Before we launch into the Q&A, I would like to introduce our group executive team. Starting on my right, Ben Bulmer, our Chief Financial Officer. Next to Ben is Dennis Tan. Dennis looks after Singapore, Vietnam and Thailand. Next to Dennis is Catherine Chia, our Chief Human Resources Officer. And at the far end is Avnish Kalra, our Chief Risk Officer.
On my left is Lilian Ng. Lilian is responsible for Greater China markets and has additional responsibility for customer and distribution. Next to Lilian is Solmaz Altin. Solmaz has a wide range of responsibilities from managing Malaysia, Indonesia, Philippines, our African markets, India as well as has responsibilities for health and technology. And on the far end is Bill who's our newly appointed CEO for Eastspring. And together, we look forward to engaging with you in the question and answers.
So back to you, Patrick.
Thank you very much. Charlie, I think we'll start in the room to respect that we're here. I think there are some microphones that will come around.
Mindy, actually, I'll let you go first.
This is Mindy from CLSA. I have two questions. The first one is about China outlook. So could you share with us more about China in terms of China outlook in the second half in terms of the sales volume, margin, product, channel, etcetera? And my second question is about the MCV segment. So in the first half, MCV segment achieved a very strong growth. So I wonder, do you expect such strong momentum to continue into the second half? And also, we also track the MCV arrivals on a regular basis. So I wonder, do you expect there still be a strong correlation between the MCV arrivals and the Hong Kong insurance sales? Or do you think there will be a sort of disconnect between the two?
Thank you. Thank you for your questions. So let me start with your first question on China outlook; and I will ask Lilian Ng, who is responsible for Greater China, to supplement some of my comments. But right at the outset, I want to point to the fact that China's growth potential and the fundamental drivers of demand haven't changed. And we believe that the aging population, the high life expectancy is only going to accelerate the demand for savings, retirement as well as the health proposition. The clear message coming out of China Mainland is focused on quality growth and quality sustainable growth over a period of time.
China is the second largest economy in the world and slated to grow at approximately 5%. We have a very strong joint venture partner, CITIC, that allows us access to 100 cities across China. And again, combine that with the multi-format-type distribution channel across agency and bancassurance, we are very well placed to capture the growth opportunity that China Mainland presents. We, on our own behalf, took some decisive measures to drive a different product mix and something that I had signaled at the quarter one earnings call and that has had a short-term impact on volumes and value. But I believe driving a much more balanced product mix is the right thing to do to deliver a sustainable value creation. And despite the decline in new business profit in China, we were able to deliver 39% growth on new business profit.
As we look forward, on an overall basis, our half 1 momentum has continued into quarter three. And we will continue to reshape our balance mix in China. And as I said, I believe that's absolutely the right thing to do to deliver medium- to long-term sustainable value. I'm going to just stop there and check, Lilian, if there is any further comments you would like to add.
So from an outlook perspective, I just want to highlight what Anil was saying. In our CITIC Prudential, we have a good multi-distribution platform. Just a little bit more color on our agency platform where we have 15,000 agency and what we've actually seen over the first half is actually the quality of our agent has improved significantly in terms of their productivity. As far as we continue to actually recruit in quality, as some of you might know, in China, where now there is a lot of focus on agency conduct in terms of their qualification as well as no contacting consumer, making sure that you do the consumer conduct. So we believe we have a very strong agency force over the year and that will continue to take us and driving a very balanced order mix as a new asset. So I think that is where we're going to continue to see strong growth in agency.
On the bancassurance front, we actually continue to work with about 6,000 outlets in China with 60-something banks. And I know everyone knows there is a transformation and transition in the bancassurance market currently happening but we strongly believe we have all the right products and the capabilities to take us forward.
Ben, would you like to add your comments on China margin?
Sure. Thank you, Anil. Look, we were very pleased we have managed to hold the margin at 43% and that was with economics going against us. So if you back out the impact of economics, actually, our margins in China are up 7 points which talks to the strength of the actions driving a more balanced business mix.
I think there was a question on MCH. The second question was on MCH.
So coming to your MCH question, so you're absolutely right, we are absolutely delighted with our Hong Kong performance. Hong Kong is our home market, meaning Hong Kong is important to us. And we were able to re-establish our leadership position in Mainland Chinese visitor segment as well as in the agency channel on an overall basis. The good news is that our growth not -- did not only come from Mainland Chinese visitor customers. It also came from Hong Kong domestic customers. And we were able to win market share not only on an overall basis but also specifically in the Hong Kong domestic segment.
You're right in observing that the Mainland Chinese visitor traffic is going to be a key driver. If you look at the traffic coming into Hong Kong up until June, it was about 50% of the 2019 levels. We have kind of seen a pickup getting into July, August to about 70%. And I don't see any fundamental impediments for it to go back to 100%, if not higher, levels of 2019. So we continue to remain exceedingly optimistic about Hong Kong, slated to grow at 4% to 5% on a GDP -- at the GDP level. As well, as I mentioned, we have seen the momentum more broadly continue into quarter three.
Okay. Charlie, I'll stay here in Hong Kong. Michael, do you want...
This is Mike Chang of CGS-CIMB. I've got two questions; firstly, on the Hong Kong business; and secondly, maybe on the 3Q outlook comment that Anil made that I thought was quite interesting. So on the Hong Kong front, like was asked previously, MCV obviously is very strong and we can see the visitor numbers, obviously, in July and August, very strong. But there was also a comment made in the pack that its return to -- it has returned back to pre-COVID levels. I was wondering whether -- and that's more on an APE basis, maybe not on a NBP basis because I think the product mix is still slightly different. Could management perhaps shed some light on the differences?
So while the volumes have returned, there are still differences in maybe the geographic mix, what percentage of it comes from Guangdong and outside of Guangdong. Maybe what's your savings mix right now versus back then? And do you see a return to normality in terms of product mix or geographic mix anytime soon? And staying on Hong Kong, as Anil said just now, the domestic segment is extremely strong, 68% year-on-year, significantly exceeding peer group. What is Prudential doing right that maybe peers are not?
And then on the outlook statement, strong momentum continuing onto 3Q. Obviously, with the visitor numbers in July and August, that's -- it's obvious that Hong Kong is quite strong. But some of the other markets that are quite big for Prudential, like Mainland China and Singapore, I'm sure there are initiatives in place to help turn around some of the underperformance. What exactly is being done in the first half that we should see in the second half or in 3Q?
Mike, thanks for your question. That was a laundry list of questions. So let me try and see if I can answer all of them and I will seek both Ben and Lilian's comment to supplement some of mine. So you're absolutely right, we are very pleased with our Hong Kong performance. And you're also right in pointing out that the quarter two volumes have now exceeded the quarter two volumes of 2019 and we've seen a level of traction continue into quarter three. We did see a spike in March and April because of the pent-up demand and you can imagine the initial traffic obviously led to a higher level of growth. We have seen a level of normalization in May and June. Still very high levels but we did see a normalization of that and that has continued into July and August.
You're right in pointing out that the demand was in savings. And again, no surprise there because one is, obviously, the customers have saved up over the last 3 years. And secondly, the interest rates are at a very different place as compared to during the COVID level. From a business mix perspective, the Mainland Chinese visitor business contributed to almost 2/3 of the NBP in Hong Kong and we're going to see a similar traction as we transition into quarter three. You are also right in pointing out that we are very pleased with our performance in the domestic segment. And in many ways, whether it is the Mainland Chinese visitor or the domestic segment, what it underscores is the quality of our franchise, the quality of our distribution. We are a multichannel format both across agency and bancassurance and that really kind of brings out the strength of our performance and the strength and the quality of the customer relationships that we have in Hong Kong.
I do want to point out that our margins in Hong Kong improved in quarter two as compared to quarter one. Our margins on an aggregate basis came in at 65% but we did see a pickup. And the last thing I would leave with you is that the health and protection mix, the number of policies in Hong Kong still contributed to 56%. And as we kind of see the normalization effect, we are going to see a gradual pickup in the health and protection NBP and contribution between now and the coming quarters.
I'm going to stop and check with Ben. Ben, if you had any additional comments.
Maybe just to reiterate a few points. Thanks, Anil. And as you say, on an ex-economic basis, margin remains very strong at 75%. We've seen the mix start to normalize a little bit, so Q2 margins grew over Q1. We're seeing good traction on health and protection policies in terms of number of new sales. And that's not just on the agency side, it's also on the banca side where H&P as a proportion of APE mix has picked up about 10 points to 15 points. So, some great traction there. Stepping back, I'm very pleased with Hong Kong margins.
Lilian?
So I've got 3 points to add what Anil said. Firstly, on the MCV, we mentioned we are tracking close to 2019 level but a lot of that track is actually in terms of the case size where we've quoted is double. Actually, in terms of number of policy, we're tracking close to the MCV traffic based on 2019. So as that increase, we will see -- we will capture that growth as well. The second point I want to call out is actually the H&P case count which is currently at 50% for MCV. But if you look at Q1, we were around 40% and it's improved to about 50%-plus [ph] in Q2. So we believe that, again, that will be trending back to where we used to see, it's over 60% of our H&P policy count and that's helped improve margin.
And just one question you have, how -- what's the volume of business from -- in Guangdong area? Actually, over 70% of our MCV volume is outside of GBA. This is what we like because we have it diversified. So we actually got GBA, it's about 30%; Beijing and the balance is about 30% [ph]; and the rest is about 30%. So we've got diversified MCV customers in our Hong Kong portfolio as well.
Mike, if I may go to your second question or second part of the question around where the growth -- what are we seeing in the early part of quarter three? So overall, obviously, Hong Kong continues to remain strong. We have seen a strong comeback in Singapore and we are very pleased with that performance. We have seen ongoing momentum in Indonesia. We see ongoing momentum in Malaysia. As I mentioned, in Mainland China, we will continue to drive a much more balanced product mix. And while that might have an impact in the short term on volume and value, we believe it's absolutely the right thing to do to create sustainable value creation in the medium to long-term.
We got Charles.
Charles Zhou from Credit Suisse. I've got 2 questions. First, when I look at your strategy, I think you just talked about 4 regions: Greater China, ASEAN, India and also Africa. But when we look at the financial reporting, I think India is still in growth and other markets at the moment. But I think 5 years later, so I mean this kind of category, so does it mean that you think that India will be -- have a very great potential? And what's your ambition for India? So in 5 years' time, shall we see your Indian business to be big enough to be just spilling out, right, I mean to be big enough to have separate reporting? So let's talk about India. So this is the first question.
And secondly, I think many questions are centered around the margin but I do want to know internally when you manage your business. So is margin also one of your KPI where maybe growing your new business profit or value of new business remains the key over time? Just want to know about how you look at the margin and the value of new business.
Thanks, Charles. I'm going to start with your India question and, more broadly, on the 4 regions; and then pass it on to Solmaz for comments on India; and then I will turn to Ben on your second part of the question which is the margins and how we kind of manage our business from a KPI perspective. So firstly, I want to make a fundamental point that for medium- to long-term sustainable value creation, it is important to have a multi-market growth engine model. And that's key to the new strategy that we have just disclosed. We have strong franchises in Greater China. We have leading franchises in many of the markets in ASEAN. We are very excited about the growth prospects that India offers. And absolutely, while Africa is not a big contributor today, it absolutely has the potential as we kind of see the demand drivers to be very similar to what we witnessed in this part of the world.
The reason why we are excited about India is obviously a 1.4 billion population. The out-of-pocket expenses, specifically on health, is as high as 50% plus. And we have a fantastic JV partner. We are almost a household brand in form of ICICI Prudential in India. So we really like our business and business model in India. But I will move to Solmaz and I'm sure he will provide you with some greater insights.
Well, thank you very much, Anil. Indeed, India, we are very happy with our franchise with ICICI. It's growing nicely. The margins are increasing and we would like to see that continuing. And we're supporting our joint venture partner where we can on this. And as you rightly say, India is going to be strategic for us. We do see as well huge opportunities in the health business. Health insurance penetration is below 1%. We will see health insurance market grow by $5 billion alone in the next few years up until 2025. So we see a good opportunity there to both grow with our joint venture partner, with IPL and also look into opportunities on how we can create a footprint in the health insurance market.
Thank you. And Charles, your question on margin, if I may. So look, you will have seen from the targets we've announced, the two objectives, that we're looking to accelerate total shareholder returns and to do that through growth. One of those targets is a value-based measure, new business profit. And from my perspective, I see margin somewhat as an outcome of an outcome, really. We are confident about achieving that value target we set out, given the multiple growth engines we have and the pillars and enablers we're investing in. But more importantly, this is about quality growth. And for every $1 invested, we're creating roughly $3.60 of value. And that's underpinned by attractive IRRs and payback periods [ph].
And ultimately, that's key. And that's really why we set then the second target of operating free surplus generation to underpin our commitment to monetizing that value creation. So you may have some products that screen with a relatively low margin but still have a very attractive IRR. And that's what it's about, fundamentally, the underlying economics.
Thank you. We're going to go to the phones now this time just to spread it out a bit. Charlie, could we have the first call from the phone, please?
Our first question comes from Larissa Van Deventer of Barclays.
Congratulations on the results. Three questions, please. The first one, to elaborate or to expand on the question asked earlier on Hong Kong, do you have any sense of how long it may take for volumes and margin and mix to normalize from a sustainable base? You've commented that it's elevated at the moment and skewed towards savings but how long before we see what is sustainable going forward? The second one, on Indonesia, very strong sales growth, up 42% on a PVNBP basis. Could you please add some color as to what was holding back the growth in the past, what sparked this 42% growth in the first half and how you see Indonesia evolving going forward? And then the third is on capital allocation. Do you expect a strong preference for growth? Where do bancassurance agreements and potential increased stakes in the JVs rank amongst your other options?
Thank you, Larissa, for those questions. And again, I'm going to ask my colleagues to supplement some of my comments. So let me start with the normalization question. So we believe that we are going to see that trend at least continue through this part of the year or in the second half of the year. It's kind of really hard for us to kind of predict as to when exactly the mix is going to shift. I do want to emphasize the point that Lilian made that 50% of our policies are still coming through in health and protection. And again, health and protection, the sales time is longer, the ticket size are smaller. But we believe that over the next 3 to 4 quarters, you will see that normalization effect come through. And again, it should not be a surprise to us because the interest rates, given where they are, it's only natural for consumers to seek the savings product. And again, as I said, we are very pleased with the opportunity to be able to serve that distinct need.
To your second question on Indonesia. Indonesia, in my view, is a key market for us. What we've called out is that in and along with Greater China, ASEAN is going to be a key growth engine for us. Of course, India, we just spoke about. But within ASEAN, we have some very strong markets. We have Singapore, we have Malaysia, we have Vietnam where we've just climbed to the number one position in quarter one. And of course, we have Indonesia. Indonesia also is the third largest country in terms of population in this part of the world after India and China. So clearly, it offers a distinct potential for growth for us as we kind of think about our strategy cycle. But I'm going to just stop there and turn it to Solmaz to offer further commentary.
Thank you. Thank you, Larissa, for the question. Indeed, we are very pleased with what we're seeing in Indonesia. We have started a good momentum in the last quarter of last year and we have seen in the first half year strong growth. As you have seen, we have grown NBP by 22% and the second quarter was stronger than the first quarter. We see an amazing reactivation of the agency channel. We have had 51% growth in APE. And just for comparison, industry growth was just 1%. So with 51%, we have really made a difference in the insurance industry.
We have a household brand in Indonesia and we will continue to play on it. We will continue to drive business through our very strong agency channel. We are still the biggest agency channel of the industry. And we're going to also explore bank opportunities when and if they arise and would value that on their merits. So we're very pleased with what we see. We do see momentum continuing and so we are continuing also with our project to really fundamentally and sustainably bring Indonesia to market leadership.
Thank you, Solmaz. Larissa, moving to your third question on capital allocation. So we are very clear that the first port of call on investing shareholder capital will be in our organic business. These are businesses that we understand. These are businesses that we have experience in. They are high IRRs in excess of 25%, shorter paybacks. So the first port of call will be to grow our organic businesses and we believe that that's the strongest use of shareholder capital. The second is building our core capabilities. We have announced a few things that we would like to invest our capital in. So we've called out scaling our health business. We've called out empowering and really focusing on activation in our agency and our bancassurance channel through technology. We have called out the focus that we are going to employ on customer and all of this will require capability build. And the underlying commonality is going to be the technology that's really going to impart the differentiated experiences that we are looking to impart for our customers. The third one is if there is a strategic fit, we absolutely will look at inorganic. And again, there are a range of options there. As you rightly mentioned, it could be a bancassurance transaction. It could be something that we would look to acquiring in the health space. It could be, obviously, increasing the economic interest in our joint venture partners.
I do want to mention that I was in India and China. I have met with our joint venture partners. We have an excellent relationship with both our joint venture partners. We are obviously leaning in quite strongly in helping grow the business on an organic basis. But they like the business for exactly the same reasons we like that business. And it's going to be important for us to ensure that we align those objectives and we are obviously going to be in ongoing dialogue with our joint venture partners. I'm just going to stop and see if Ben had any further comments to add on capital allocation.
I think the only thing I'd add, thanks, Anil, is when it comes to making strategic investments, given the attractive economics we've outlined, for us, it's about widening that opportunity set for reinvestment. And as I said during my speech, ultimately, if we can't reinvest at appropriate rates of return, then excess capital that is created as we move through the objective period, we will consider returning that. But from where we sit today at the start of our objectives, we're in a position of strength, ultimately, to pursue the growth we've set out.
Thank you. Charles, let's keep going on the phones. Next question from the phones, please?
Our next question comes from Andrew Sinclair of Bank of America.
First one for me is just on your new business profit target, 15% to 20% CAGR. I just wonder if that's a little bit ambitious, frankly, given the depressed 2022 base and the rebound you'll get over the next couple of years. I mean, if we're talking about Hong Kong reaching new highs, I mean, frankly, if we get Hong Kong back to 2018's level, then you'll hit the bottom end of your target range even without any new business profit growth in any of your other markets over the next 5 years. So I mean, just really, if you can help me square that circle on where Hong Kong can get versus what should we be expecting elsewhere and can that target really be beaten if things go smoothly? That's my first question.
Second question, on health insurance and again, just going back to India, just really wondered if you can give us a little bit more color on your thoughts as to how you can penetrate health insurance in India, first, given you do only have 22% of ICICI Pru and I don't think we have a license to sell health insurance last time I heard. And frankly, if there's going to be any build-out for Indian health insurance, is that included in your $1 billion investment spend?
And then if I can just ask a third question, sticking on health. How much do you expect the product to change if health is becoming more of a push? Do you think you need to add more capabilities or it's just going to be kind of pushing harder?
Thanks. Thanks for your question, Andrew. And let me start with the 15% to 20% CAGR new business profit question. So we've been exceedingly thoughtful in terms of crafting these targets. Clearly, there are a set of opportunities on the horizon, as have been well documented and articulated but there are also a bunch of challenges out there. And the fundamental thing is that we have the ability and we have the capital strength to be able to invest in the multi-market growth engine model. And equally important, we are very conscious of the fact that we need to convert the new business profit creation into free surplus over a period of time. And our emphasis will not only be on new business profit but also ensuring that we are managing our in-force in a very disciplined way and then converting that into free surplus.
We are very pleased with the growth that we witnessed in the first half of the year but that can't be a common factor as we kind of think about the strategy cycle period. But to the extent that we have an opportunity to over-deliver, I can assure you we're not going to hold back. We absolutely will try and beat the 15% to 20% CAGR growth target. But the point that I wanted to land on you is what is going to be essential is that we are thoughtful about it, that we are writing quality business and focusing, at the same time, converting that top line growth into free surplus generation.
On your question on health in India and I'd like to go back to Solmaz once again, yes, absolutely and we are keeping all our options open, both looking at options to grow health organically; or if there are opportunities, we will explore ideas to look at inorganic opportunities as well.
But I'm going to ask Solmaz to provide a little bit more color on that.
Thank you, Anil. And then I will also start to answer your wider question on health and capabilities beyond India as well. Now on India health, as you know, our life joint venture mutual license [ph], as you mentioned rightly, cannot drive health business. And the health business is written mostly by either general insurers in India or the stand-alone health insurance companies. We see especially opportunities in the SAHI, the stand-alone health insurers in India. They have grown over the last 5 years by 30%. And in light of some of the metrics that I mentioned before with huge under-penetration, huge out-of-pocket expenses, we do see continued momentum in health insurance in India on the back of also the economic momentum in India. So that's an area where we're really interested in, on the SAHI proposition and we're exploring ways on what -- how we can play a role in that opportunity.
When it comes to the wider health strategy, we have a two-pronged strategy. Firstly, we want to, indeed, as you say, manage health insurance as health insurance and not as we traditionally did. And we grew, by the way, with that way to one of the largest health insurers in Asia with about $2 billion in earned premium and 5 million customers in health insurance reimbursement alone. We want to still focus more on health insurance and the capabilities of being a payer in the customer journeys in the health care system. What that means is we want to have capabilities around medical excellence, around technical excellence. We want to share best practices around how best to manage health claims, how best to price policies. We want to move from every three to four years repricing to annual repricing and then be able to make risk-based pricing in sophisticated ways. So these are capabilities that we will add and invest in.
The second priority is indeed that we want to explore possibilities on how we can embark on adjacent customer journeys: so before someone gets ill, after someone gets ill and hasn't received the treatment, i.e., in care opportunities and rehabilitation and managing of chronical illnesses. So these are adjacent journeys to our payer role which is why we are saying we want to evolve from a payer only, where we will deepen our capabilities, to also partner adjacent in connected care journeys. Back to you, Anil.
Yes. And I just wanted to emphasize that Solmaz, who leads our health business, has prior experience of managing and growing the health business. So we're really looking forward to his leadership as we have raised our ambition for our health business. Back to you, Patrick.
Thank you. Well, let's keep going on the phones. You've been patient. So next caller, please, Charlie.
Our next question comes from Farooq Hanif of JPMorgan.
Congratulations on your results. Going back to your DPS growth ambitions in the near term and what you're saying, Ben and Anil, about capital return, how should we think about what your level of surplus capital is? So what would you say is the binding constraint for you? And at what point could you get to a decision where you think, well, we've got enough surplus and we want to show that discipline and give it back? Plus also the DPS growth that you've given of 7% to 9% seems low in the context of your free surplus generation. If you could talk about that whole topic, that would be great.
Secondly, it's quite clear that you're moving away from a federated model at Pru and wanting to have just best-of-breed, best practice, not repeating things and having a single platform across the business. Will that come with some sort of operational leverage or cost efficiency? And where might we see this?
And then lastly, on agency, you talked quite a lot about activation as well as recruitment. Are there any numbers or ambitions you can give around both of these for the business? And actually, I have one final question. I'm really sorry. A client is asking about your exposure on asset risk to local government financing vehicles in China, if you're able to talk about that.
Thank you, Farooq and it's good to hear from you. A bunch of questions and I'm just going to kind of play a traffic cop. So let me start by asking Ben to address your question on surplus capital.
Yes, thank you. Thank you, Anil. Farooq, so look, where we stand today, I'd say we're well but not excessively capitalized. You've seen the strong GWS ratio of 295%. As we've said before, our free surplus stock of $8.4 billion really is a better measure of distributable funds. And as you will have seen, we're holding about $3.3 billion in centrally in hold cash [ph] at present.
Our businesses are capital generative, so we generated $ 0.7 billion of free surplus post strain and most of our businesses are self-funded. As you know, we're operating at the lower end of our leverage ratio. So we have flexibility. But our agenda is driving shareholder returns through growth and deploying that capital organically, going back to the IRRs that were quoted earlier. We're going to do that through investing in our core capabilities and build optionality around making strategic investments as we go forward.
In terms of the 7% to 9% DPS guidance, so the Board decided to revisit our dividend policy in light of the strategy we've announced today. In doing so, it concluded that the link remains appropriate between the dividend and free surplus generation which is entirely sensible. The 7% to 9% range is commensurate with payouts from the last few years but also looking back historically to recent gross operating free surplus generation. Yes, we aspire to get this to double digits and we'll be working hard to do that to fulfill our commitment to monetize the value we intend to create.
Thanks, Ben. Farooq, I'm going to move to your second question on the organizational model. So the point that I want to convey here is that the objective here is to be able to leverage both the economies of skill and economies of scale as far as our business is concerned. We are already a very large player. And what we are trying to do as part of the new organizational model is create centers of excellence in a way where we can then impart the best-in-class experiences to our customers and to our distributors. And we don't have to reinvent the wheel every single time that we think about a certain or developing a certain capability.
I do want to emphasize, having run many of these markets in this part of the world, the importance of empowerment. So we are not going to be curtailing the empowerment for the local CEOs. The local CEOs will absolutely be empowered to manage their business from an end-to-end perspective. And as I said, I realize the importance of that. What we're going to ask them to do is to consume services differently. So whether it is talking about data analytics or talking about marketing or talking about creating digital experiences, talking about how we source talent, you don't have to create those capabilities individually which are going to be much more expensive to create in every single market every time. And that is where the centers of excellence will allow us to leverage both the economies of skill and scale as we kind of deploy and execute against our new strategy.
And to your question, where will this be evidenced? It will be evidenced in our expense variances. And something that I've already indicated, it's going to be essential to manage if we have to translate the new business profit creation into free surplus generation.
Onto your third question on agency activation, we have given numbers as part of the nonfinancial metrics. So one very distinct number that we put out there is that on a monthly basis, we have approximately about 65,000 active agents and we would like to grow that to 85,000 to 90,000 agents between now and 2027. And I think, again, the key thing there is going to be how you enable our agency with technology so that they can spend more time with customers rather than shuffling the paper back and forth.
On your last question on assets exposure to LGFV, I'm going to go to first to Ben and then to Avnish to see if they have any comments to offer.
Yes, thank you, Anil. So our shareholder exposure is absolutely de minimis at $5 million. Our policyholder exposure in terms of directly held debt, small, $79 million and that's in infrastructure and transport-related services. As you know, we account for our China business as a joint venture, an associate, so we bring its share of net -- or net our share of its net assets onto the balance sheet rather than line-by-line consolidation. I have, in the appendix of my slides, included a slide for you that shows a snapshot of CPL's invested assets and its general account at our 50% share. Within that, you can see that CPL has an exposure to the LGFVs of $1.1 billion. Now that's in AAA, AA-rated investments along the economically developed Eastern and Central regions.
Thank you, Ben. Just checking with Avnish if any further comments?
There's nothing more to add. Ben has already covered it.
Thank you. Thank you, Ben. Thank you, Avnish. And Farooq, I hope we've been able to answer your questions but happy to kind of take follow-up questions when we get to meet you in person. Patrick?
Thank you, Anil. And for the people on the website, there are videos of the presentations, including specific presentations on distribution and customer. And also Solmaz has got one on health. I just want to remind the audience of that. Okay, let's go back. We'll have one more question from the phones and then we'll go back to the floor. There were some very patient people here. But let's go back to the phones, please. Charlie?
Our next question comes from Andrew Crean of Autonomous.
Could I go back to explore the capital excess? I mean 50% capital ratio on GPCR would give you $11.6 billion of excess. Although $7 billion, I think, is -- you regard as restricted. So that would give you an excess of about $4 billion which would take your free -- would halve your free surplus. Is that -- are you happy with that kind of mathematics? And the second question is, you talked about inorganic in terms of banca and health. What sort of size are we talking about? And then thirdly, developing on from that, I mean, there's been a long-held desire or anticipation that you would look at your joint ventures and associates and buyout both in China and India. Do you really think that, that is credible in the near to medium term? Or is that much more of a longer-term vision [ph]? Finally, is there any plans to report embedded value under a TEV basis at the year-end?
Sorry Andrew, I didn't pick up your fourth question. Patrick, did you pick that up?
And Ben [ph], the last one was on TEV versus EV. And the first one, I think, was on the surplus buildup and whether you are comfortable with the amount of central assets in that surplus.
All right. Thanks for your questions, Andrew. So let me go to Ben on the capital surplus one as well as address the TEV, EV one. So Ben, why don't you tee us up with the capital one and I can take the rest?
Sure. No, no, thank you for your question, Andrew. And you're right, when we look at the free surplus start in excess of the PCR, the $8.4 billion, as I said, we've got about $3.3 billion held centrally. In terms of your math of assuming 4 -- roughly $4 billion is deployable, yes, I mean I'm always going to want to hold cash centrally for liquidity purposes. As we said before, a rule of thumb, it's 12 months of outgo plus the dividend and a buffer. Of the remaining capital then sat in the businesses, clearly, we want to hold some close to the business, notwithstanding our growth plans. But yes, your math is broadly right.
In terms of your question on TEV, look, I hear the ask. I'm conscious we've only just delivered IFRS 17 on an interim's basis. We've yet to do so in terms of our full year accounts. And it -- I think looking forwards, what's interesting is, of course, the IFRS 17 shareholders' equity. In effect, if you want to take the sort of economic risk returns debate off the table, that gives you an MCV-like lens. I would remind everybody when you're thinking about market risk, as I said during our IFRS 17 session a few weeks ago, looking at our VIF, 51% is H&P and 26% with profits and 17% unit-linked. And of course, continue to point people to the sensitivities we publish should you so choose to use them.
Thanks, Ben. And the only other point that I would add Andrew, to the TEV, EV question is while we are open-minded, I'm focused on driving operational performance. I think that is where the shareholders are going to experience the true value creation. And you're starting to kind of see a bit of the evidence of the results that we have or delivered in the first half of this year.
Let me go to your joint venture question and then I'll kind of sign it off with the inorganic one around banca and health. So on joint venture, I did mention the fact that I was in India and China, great relationships. They like the business exactly for the same reasons that we like the business. So in the near term, we believe that the opportunity is going to be more to focus on growing the organic business and that is where we are focusing and driving value for both our partners across India and China.
And on the inorganic question, again, I don't know how I can give a number on the size. It will really depend upon the bank in question and how big the landscape is but we have capital strength. We have, as Ben noted, a significant capital strength to be able to grow and deploy capital in our organic businesses. And if there is an opportunity, we will be happy to drive investments in our inorganic businesses as well. But this is something that we will be on an active lookout for.
Okay. Let's go back to the -- sorry Andrew, did you have a follow-up? No. Okay. Let's go back to the floor. There at the back.
Leon Qi from Daiwa. I appreciate your strategy update which gives us a lot of information to anchor our long-term expectation. So I have two questions today regarding your two financial objectives for shareholders, respectively. First of all, regarding your NBP growth CAGR objective of 15% to 20%, we've discussed quite extensively on the geographies early on. So I just want to ask about the product mix. I do appreciate all the initiatives and efforts we just mentioned on the -- on promoting H&P but I guess the reality now in the market is that the savings demand seems to look like better than H&P. So do you think this 15% to 20% NBP CAGR is going to come in more from H&P or savings?
And then secondly, if I may ask a question to Ben on your shareholder returns. We have another financial objective on growing the gross operating free surplus by double digits. And we -- our latest dividend policy is 7% to 9% DPS growth. I just want to confirm, what's the difference between these two numbers? Is this entirely attributable to free surplus investments into the new business or there is something else? Or we think they should look at these two metrics separately going forward? And well, another sub-question to that actually. What will -- given our GWS is still close to 300% which is very comfortable, what will have to happen to make you make another revisions to your dividend policy or start to consider buyback? What will happen to drive you to consider all these other possibilities in terms of shareholder returns?
Thanks, Leon and it's good to see you again. So let me start with the new business value question and geography and product mix. I think the important point here is more about ensuring that we are driving diversification as we have demonstrated in our channel mix. Our agency is back this year very strongly. Last year, it was bancassurance, as agency was a bit constrained on account of some of the containment measures. Likewise, on product mix, I just illustrated one example where we have been very decisive on China Mainland to be able to drive a much more balanced product mix. And that's not going to be different from the way we kind of think about driving businesses across Asian and African markets.
Yes, you're right, the existing demand is coming in savings, specifically in Hong Kong but you're seeing more than 50% of our customers being new to Prudential. And I think that's an excellent opportunity for us to anchor the relationship by offering a savings product and then over a period of time, upsell, cross-sell some of the health and protection products. So I don't have a definitive view as to how the shape of that product mix is going to look. But what I can tell you, it's going to be a balanced one to the extent that we can influence it.
I'm going to go to Ben back on the shareholder return, dividend and free surplus buyback question.
Yes, no, thank you. And unconsciously, we've sort of touched on both of these briefly to some extent. In terms of sort of GWS ratios and returns of capital, again, I'd guide you to look at free surplus as the best reference for deployable capital. GWS surplus counts a lot of future profits that are yet to monetize into free cash flows, if you like. And we have a dividend policy that centers around paying dividends out of flow, out of free surplus creation. I talked about the 7% to 9% reference earlier. We've talked about the ambition of growing this double digit in the longer term. And the guidance we've given you is purposely near term, that's in '23 and '24, that's because the Board is looking through the additional $1 billion investment. And the geography of this investment will be as a variance to operating free surplus generation to EV and in our IFRS 17 accounts as well. And that's because this is investment over and above the loadings in our existing cash flows. It's temporary in nature. And ultimately, it will drive value.
So it will be reported as a variance. I mean just for everybody's benefit, when thinking about modeling for that variance going forward from an IFRS 17 perspective, it's worth assuming it's about 1/2 to 1/3 of the OFSG quantum that will come through in any given year and because amounts are taken to CSM and then take time to come through the earnings statement.
And just, Leon, one more point on buyback. I think the fact that we are now anchored in the high-growth, high-potential markets of Asia and Africa, I think we have plenty of opportunities to deploy capital to grow our business organically. And again, I do want to emphasize that these are businesses that we understand. These are businesses that we operate in, we have experience in. We have great brand in many of the markets. So that is really going to be the first place that we're going to go to deploy capital. And as I said, there are plenty of opportunities across that -- across the markets that we operate in.
Let's go -- we have one more from the floor, then I'm going to check the online questions and then we'll go back to the phones. Can I have another question from the floor?
I'm Michelle from Citi Research. I also have 2 questions today. So first, I really appreciate about this whole strategy presentation. That's like a dictionary to me, so I need to spend more time on this. But all the targets, that's very clear, detailed and measurable. So I really appreciate that. And talking about the NBP growth rate [ph], 15% to 20%, I think that's a very decent growth target. So maybe can you just roughly give us some idea on which country or region in your mind will lead the pack for the growth? So I understand it's all under-penetrated and have great potential. But just in your mind, so in the coming like 4 to 5 years of time, so which regions maybe we will see stronger growth and which regions maybe need more time for transformation? That's my first question, just rough ideas for us.
And the second thing is on China again. So I also really appreciate we are being very disciplined in the first half not to follow the market to sell those high-guarantee-rate products. So my question is, so currently, we are experiencing some interest rate decline and the saving product actually is gaining traction in China. So I wonder about what our actually guarantee rate for the in-force policies? And what's the current investment return can be achieved in China? So I'm actually talking about the potential negative investment spread. And in your mind, if China is still actually economically attractive compared to other regions, given the current status quo.
Yes, great questions. And Michelle, thank you for both of those. I'm going to talk about the strategy in the region and where we expect the growth to come from; and then I'll go to Ben and Avnish on your second question on investment returns, given the declining interest rate environment in China Mainland.
So again, coming back to the multi-market growth engine and as I said, we right now have the capital to be able to invest across Greater China, ASEAN, India and Africa. But the markets that I would like to call out, obviously, Greater China and Hong Kong are going to be very important for growth. Within ASEAN, I see Singapore, Malaysia, Vietnam and Indonesia. I think they are going to be the key for us to be able to drive growth. India, as I said, there are a couple of options that we are working on. And as Solmaz articulated, we are looking at the health opportunity that can be, maybe not in the immediate term but if you look at a range of 5 to 10 years, that can be a potential growth driver for us. Clearly, within the strategy cycle, it maybe not necessarily have a major impact in its new business contribution. But over the 5 to 10 years, I think it could be a potentially big contributor to the mix of business that we originate.
I'm going to go to Ben on the China investments. And maybe, Avnish, if you have any supplementary comments to add.
No, thank you, Anil. Michelle, so in terms of your question on returns there, look, our China business has a very robust risk management framework. We have a large in-force book but it's a very diverse book. We write power business. We have investment-linked business and so on. And as I referenced earlier, there are some slides in the appendices that show you we have a diverse portfolio of assets backing that. As has been referenced earlier, too, we've taken actions to continue to diversify that product mix on a go-forward basis. So I don't have any concerns about negative spread, if that's what you're asking.
Avnish?
Yes. I'd just like to add that the business, as Ben alluded to, has a very strong ALM management muscle which it exercises through its ALM committee which monitors very closely, as you can imagine, the blended guarantee in the portfolio, the investment returns, the duration mismatch and are very nimble in taking actions both on the product side as well on the asset side to adjust and rebalance as necessary.
Thank you, Ben. Thank you, Avnish. Patrick?
Thank you. I'm conscious, we've got a few more minutes. I've got probably a few on the line. Should we go back to the telephones please, Charlie?
Our next question comes from Kailesh Mistry of HSBC.
I think most of them have been answered. I just wanted to go back to the $1 billion investment over the next 5 years. I just -- I think Ben mentioned it in his last response but I just wanted to clarify. So the $1 billion goes through EV operating variances between '23 and '25. And then I think you said 1/3 to 1/2 goes through, is it CSM and then through the OPAT? Or is it directly through OPAT variances? So that's the first one. Second one is on the technology investment, effectively, what are you doing in this program that you haven't done already? Obviously, you talk about agency, banca and health. But could you just give us some color on exactly what is being invested in, in order to deliver on the outcomes you're trying to achieve? And the last one, just on the CSM evolution in the first half. On the variances, I think there was a small positive. But if you could just separate out what was mark-to-market and what was operating, just so we understand the movement there. Obviously, we don't have sensitivities but it would be useful to understand that.
Thank you, Kailesh and it's good to hear from you. So I'm going to ask Ben, firstly, to answer the first question on $1 billion investments and how that's going to kind of come through our variances. And then, Ben, if you could also kind of take the CSM evolution. And Solmaz, if you could answer the technology investment and what specifically are we going to change in our technology architecture.
Yes. Okay. Kailesh, so you're right, the $1 billion, as I said in my speech, was weighted '23 through '25. In terms of how you should think about that, I'd guide you really to elevated levels of about $150 million in this year, it's $300 million in 2024 and 2025. In terms of how that comes through on an IFRS 17 basis, I'd expect about 1/3 to 1/2 will come through as a variance, the remainder unlocking the CSM and that then subsequently creating that more deferred earnings effect.
In terms of your third question that I think was variances and CSM, I'm sorry, I didn't quite catch the question. Would you mind maybe repeating to us?
Yes. So I think it was where do you see the -- there was a positive -- referred to a positive variance coming through this half where -- what was that split between economics and operating variances?
So we had a negative variance of around $90 million on IFRS 17 coming through in the first half. That was in part investment in the business but in part deterioration on medical reimbursement business and we've seen this across our 4 larger medical markets. To some degree, this is a sort of post-COVID impacts where we've seen higher levels of diagnosis but also higher incidence rates. Clearly, we have levers to be able to address that and through repricing but also we've -- as we talked earlier, our intent to invest around health, data, technology to improve risk-based pricing, claims and so on and so forth.
The balance was through the CSM, there was a positive economic variances here...
So positive of 0.3, 0.4 on economics, that's right.
You want to take the CSM evolution question?
I missed the CSM evolution question.
So I thought the question was more around the fact that CSM is positive. And is the mark-to-market included as part of the CSM results that we've disclosed?
Yes. So there's a small positive of $300 million to $400 million and you can see that on the CSM role.
And then, Solmaz, on...
Solmaz, on technology?
Yes, thank you. Now technology -- and I could talk hours about this but I will try to keep it to roughly a minute. So as you can tell from the strategy, we're going to focus on customer distribution, health and technology needs to support all of that. So on customer, we will have to link customer data with our core value-creation processes and we want to enable customers to self-service digitally like the experience from the likes of Amazon, Google, etcetera. So we are going to have technology supporting all of the strategic key pillars.
On top of that, as Anil mentioned in a strategy overview as well, we're going to embark on a new operating model where we're going to learn from each other. We're going to have a different collaboration model. So we will have -- we currently have a situation where -- and there are decent applications but every country having their own applications in many of our value chains. So what we want to do is if Hong Kong has a great application, we want to make this available to others. If Singapore has a good application in health, as they have, we want to make it applicable in Indonesia. Yes, language barriers but this can be overcome.
On top of that and that's really important, we want to use our data better. We will use AI more, especially with regards to new gen AI applications and we want to link data flow within the organization in much better ways.
Okay. If I'm allowed to, I'm allowed two more? Indulge me? So two more, please, Charlie.
Our next question comes from Ashik Musaddi of Morgan Stanley.
First of all, congratulations for setting out a new strategy, a new goal. It's been quite some time but good that we have it here. Just a couple of questions I have is, first of all, how are you thinking about currency? Now one of the key issues that we have seen in the past, especially with respect to ASEAN countries, is the currency because of typically higher interest rate or higher inflation in those countries versus dollar. So how are you thinking about currency? How much headroom have you kept in your numbers to absorb some of the currency movements? So that's the first one.
And the second one is, again, going back to some of the questions earlier is, is it possible for you to give some color about your growth, the VNB growth and the OFSG growth but by geography, let's say, big-picture geography such as Greater China, Hong Kong, China and then ASEAN and then others? Some big picture as to how you are thinking about that 15% to 20% growth, is it like much more towards Hong Kong, China, less ASEAN? Or is it more similar everywhere? So some color on that would be very helpful.
And then just one last question is, is it possible to get some color on cash upstreaming from the free surplus generation? Will you be following any particular ratio, any particular formula when you think about getting cash to the holding company?
Thanks, Ashik. Thanks for those questions. So I think they kind of squarely fall with Ben but I'll add my comments at the end once Ben has addressed the question on currency, the NBP, OFSG growth and what regions are we getting that from and the cash upstreaming.
Yes, thank you. Ashik, so on your point on currency, look, the main currency effects for us are really translational in our accounts. We currency match locally. That said, we've seen some significant devaluations in a number of our African countries. Nigeria, for example, I think Kenya, the currency devalued about 20%. So -- but for us, as I say, we're matched locally. These are manageable. These are small amounts. So yes, it's a translational effect. In terms of cash upstreaming, as we've said before, we look to maintain resilient capital positions locally. We want the surplus close to where the growth is going to come. Our remittances are driven by free surplus generation and that's true at a local business level as well. There's no impediment to that. You will have seen in the holdco cash flow, we brought up about $1 billion of cash in the first half of the year to add to the proceeds from Jackson shares. And I'll look to continue to maintain a steady flow from our businesses.
Thanks, Ben. And Ashik, on your question in terms of the geography split, again, going back to the earlier question that was asked around Greater China and ASEAN and again, if you just kind of look at the mix, from the strategy planning cycle time, I believe that the growth is going to come largely from the Greater China markets and ASEAN. And again, you simply have to look at the NBP mix of 2022 and you have to look at the NBP mix of the first half of this year. When we had COVID restrictions, ASEAN was a stronger contributor, greater than 50%. And when the COVID restrictions have gone away, obviously, the Greater China, Hong Kong being a dominant player, is contributing more.
The important point being -- and again, I want to reiterate that, is that we have capital flexibility to grow Greater China and ASEAN at the same. It is very difficult for me to forecast as to which market is going to grow at which pace. What we are focusing on is operational performance, ensuring that we are building the right capabilities so that we are able to attract a greater share of wallet with our customers.
Okay. I think if we can, we just have the last question, please, Charlie and then we'll cover it up.
Our final question today comes from Dom O'Mahony of BNP Paribas.
I've just got two left, if that's all right? One very short. Thank you for the new targets. Can you just confirm that these are organic targets? Or to put it another way, if you were to do any acquisitions of note, that you'd consider revising them upwards? And then, I guess, a more broader strategic question. When I look at the targets and as I listen to you talk about the business, I get the sense that there's been a slight shift in the way that you're assessing value. So Ben, for instance, you made a point earlier about how some products can have a low NBP margin but can be very high IRR and that NBP margin, in a way, is an output, not your focus. And my sense is that this is a slight change in the way you're thinking about value creation, oriented more towards surface generation and IRR. Is that fair? Or have I misread this?
Thanks, Dom. So both good questions and the short answer to the first one is it's only organic. So the inorganic part is not included in the target setting that we've just disclosed. On your second question, no, we will be focused on the margins; absolutely, we will. And again, a good signal of that is the way we have been able to manage, for example, the product mix in China Mainland or the way we have been able to respond to the growth that we are seeing in Hong Kong. So it will be a balance, obviously and that is something that we are going to consciously manage over a period of time. What I can tell you is if you look at the growth targets that we've shared, predominantly, that growth is going to come from volume. There will be some opportunity for us to walk through the margins but the predominant growth is going to come from volumes between now and 2027. But rest assured, we are maniacally focused on margins and ensuring that we manage the product mix effectively.
Thank you, Charlie. I think we will go back to Anil for some closing remarks.
Thank you, Patrick and thank you, everyone. It's indeed a pleasure and you could probably kind of sense the excitement both in terms of our half year performance as well as our new strategy. Having now been with the company for 6 months, I truly believe Prudential is a great franchise and has not yet realized its full potential. And we are going to be leaning in quite diligently on operational and financial discipline. The strategy that we have just announced, to my mind, the power of that strategy comes from its simplicity, our 3 strategic pillars, 3 enablers and an organizational model and technology that will help us execute against the strategic goals that we've kind of set for ourselves. But we look forward to engaging with you in person. Ben and I are going to be on the road between now and the next couple of weeks.
Thank you for your participation. Importantly, thank you for joining us this morning, this afternoon.
Thank you.