Challenger Limited · ASX:CGF
Challenger — Challenger Financial Services Group — Merger or Acquisition (February 2007)
8 slides from Challenger's merger presentation, Feb 28, 2007
Slide 1: Transfer of MetLife Annuity Portfolio
Challenger Financial Services Group Limited Transfer of MetLife Annuity Portfolio Mike Tilley – Chief Executive Officer 28 February 2007 1
Slide 2: Transfer of MetLife Portfolio
Transfer of MetLife Portfolio • MetLife Insurance Limited (‘MetLife’) will transfer its Australian annuity, allocated pension and personal superannuation portfolio to Challenger • The portfolio is almost $2 billion • Supporting assets include: – Approximately $1 billion investment grade fixed income
Slide 3: Transaction overview
Transaction overview • Assets and liabilities will be transferred under Part 9 of the Life Insurance Act • Targeted to complete on to 30 June 2007 • The transfer also involves Challenger taking over all the shares of MetLife Trustee Pty limited (the MetLife Superannuation Trustee) • Economic exposur
Slide 4: Committed participant in the annuity market
Committed participant in the annuity market Total size of annuity funds 31 December 20061 • Transfer will strengthen Other Challenger’s position in 18% Challenger 17% the capital guaranteed pension sector • Challenger a committed BT (ex WBC) 6% owner of the portfolio MetLife 13% – Provides an attrac
Slide 5: Enhanced financial strength leverages capabilities
Enhanced financial strength leverages capabilities • Asset Management has capabilities to optimise yield from assets • Increased balance sheet scale leverages Asset Management’s skills and capabilities – Origination – Structuring – Transacting / Managing Assets • Asset Management’s acquisition capab
Slide 6: Cost effective funding
Cost effective funding • Cost-effective funding – below bank bill rate • Additional funding for pipeline of investments • Significantly raises investment level before capital constraints arise • Portfolio has similar characteristics to existing CL2 portfolio • Positive impact on liquidity 6
Slide 7: MetLife – liabilities to be transferred
MetLife – liabilities to be transferred Guaranteed Income Plan – Allocated Pension Personal Deferred Annuity Immediate Annuities Plan Superannuation Superannuation savings A term certain immediate and accumulation A long-term multi phase annuity providing a regular Allocated pension plan product. Al
Slide 8: Asset Allocation Plan
Asset Allocation Plan Fixed interest & Equities 10% cash • CL2 works within the bounds of 30% a target Asset Allocation Plan: – 30/30/30/10 Infra- structure 30% • Following transfer there will be an initial shift in the allocations: Property – 50/20/20/10 30% Equities • Future asset allocation will
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