Business update - 30 June 2022

30 June 2022 Business Update

Resolution Life Australasia reported an after-tax statutory profit of A$77.8 million for the half year ended 30 June 2022 and in September 2022 declared a dividend of A$77.8 million and a capital return of $103.5m relating to 1H22 (subject to the Australian Prudential Regulatory Authority (APRA) approval).

The business has remained resilient in the first half of 2022, generating a stable profit and capital emergence for shareholders while continuing its transformation to become a customer obsessed, data driven and digitally enabled business.

As at 30 June 2022 Resolution Life’s capital base of A$2,443 million was A$1,649 million in excess of the Prescribed Capital Amount of A$794m which represents a Capital Adequacy Multiple of 307% (pre-dividend distribution).

Resolution Life Australasia update on the acquisition of AIA Australia’s Superannuation & Investments business

Good progress has been made since the announcement (Feb 2022) of the acquisition of superannuation and investments business from AIA Australia Limited.  The expectation remains that the acquisition will, upon completion, drive the value and scale benefits previously highlighted. A completion in 2023 is targeted subject to regulatory and court approvals.

Resolution Life Australasia acquires Macquarie Life business

Resolution Life Australasia reached an agreement to acquire approximately the 200 annuity customers of Macquarie Life. This achieved a significant milestone where APRA approved the transfer of the policies from Macquarie Life Limited to Resolution Life Australasia in mid-August. Work is underway to notify the customer base that the transaction is in progress with the court confirmation hearing on 5 October 2022. Resolution Life Australasia’s target completion date is set for 1 November 2022.

Resolution Life Australasia Leadership Announcement

Resolution Life Group in July 2022 announced changes to the leadership of Resolution Life Australasia as its global business continues to grow. Tim Tez will join Resolution Life Australasia as Chief Executive Officer from February 2023. He is currently CEO, Medical Indemnity for Avant Mutual, and was previously at AIA. Tim has over 20 years of experience in the life and health insurance industry with an extensive background across distribution, M&A, strategy, reinsurance, product, pricing, marketing, and government relations. Tim will succeed Megan Beer, who will relocate to London in 2023 to become the Chief Operating Officer (COO) of Resolution Life Group as part of the planned succession for the retirement of John Hele, who will continue to serve as President and COO until July 2023.

As Group COO, Megan will oversee the development of the Group’s global operations, including plans for the transformation of its acquired businesses.  In her new role, Megan will serve as a Board member of the Group’s key subsidiaries, including continued service on the Resolution Life Australasia Boards.

Resolution Life Group

In April 2022, Resolution Life announced the formation of its new Representative Office in Singapore. The formation of the Representative Office is the first step in Resolution Life’s plan to establish itself in Asia, with ambitions to grow its portfolio by supporting the primary life insurance industry.

In June 2022, Resolution Life announced that Resolution Re had entered into a reinsurance agreement with The Dai-Ichi Life Insurance Company in Japan that transferred a closed book of whole of life policies with JPY150bn (~US$1.5bn) in total liabilities. The agreement relates to coverage for market risks and insurance risks.  Dai-Ichi Life will continue to service the reinsured business, while Resolution Re and Dai-Ichi Life will work together to successfully manage the reinsured policies for the benefit of policyholders.

Resolution Life Group continues to actively seek out further acquisition opportunities both within Australia, New Zealand and globally.

Key metrics – Resolution Life Australasia

(in AUD millions)

1. Figures are unaudited balances 2. Reduction in Statutory profits are mainly due to market movements, particularly from rising interest rates and falling equity markets. Decrease is also due to the volume of policies and associated AUM reducing over time as a closed book.  3. The decrease in net assets is driven by dividend and foreign currency translation reserve partially offset by net profit. 4. Similar drivers to net assets, however, excludes impact of movement in intangible assets (e.g., deferred acquisition costs). Balances are prior to planned dividends of 30 Jun 2022. 5. Higher than expected releases due to market movements (higher interest rates, lower equity markets) and release of additional allowances held for event risk (including COVID-19 related allowances).

Credit ratings

Resolution Life Australasia’s credit ratings are as follows:

In April 2022, Fitch assigned ‘BBB’ ratings to Resolution Life Group Holdings and RLGH Finance Bermuda. The outlook on all ratings is Stable.

Contact details

For investor enquiries, please contact:

Graham Duff
Treasurer & Deputy CFO, Resolution Life Australasia
+61 411 703 429 | graham.duff@resolutionlife.com.au

Anil Shaw
Assistant Treasurer, Resolution Life Australasia
+61 422 674 081| anil.shaw@resolutionlife.com.au

For any media enquiries, please contact:

Erica Borgelt
erica.borgelt@secnewgate.com.au

Tanya Creighton
Tanya.creighton@secnewgate.com.au