Exhibit 99.2
VOYA FINANCIAL TM
Quarterly Investor Supplement
June 30, 2014
This report should be read in conjunction Voya Financial, Inc.’s Quarterly Report on Form 10-Q for the three and six months ended June 30, 2014. Voya Financial’s Annual Reports on Form 10-K, and Quarterly Reports on Form 10-Q, can be accessed upon filing at the Securities and Exchange Commission’s website at www.sec.gov, and at our website at investors.voya.com. All information is unaudited.
Voya Financial Table of Contents
Page 2 of 70
Page
Consolidated
Explanatory Note on Non-GAAP Financial Information 3-4
Organizational Chart 5
Key Metrics 6
Adjusted Operating Return on Capital and Return on Equity 7
Adjusted Operating Earnings Before Interest, After Income Taxes 8
Consolidated Balance Sheets 9
Consolidated Statements of Operations 10
Ongoing Business Sources of Operating Earnings 11
Consolidated Earnings Before Income Taxes 12
Operating Earnings by Segment 13-14
Operating Revenues and Operating Earnings by Segment 15
Adjusted Operating Earnings by Segment 16
DAC/VOBA Segment Trends 17
Consolidated Capital Structure 18
Consolidated Assets Under Management/Assets Under Administration 19
Retirement
Sources of Operating Earnings 21
Operating Earnings 22
Assets Under Management/Assets Under Administration 23
Assets Under Management Rollforward 24
Annuities
Sources of Operating Earnings 26
Operating Earnings 27
Assets Under Management 28
Assets Under Management Rollforward 29
Investment Management
Sources of Operating Earnings 31
Operating Earnings 32
Key Metrics 33
Account Value Rollforward by Source 34
Account Value by Asset Type 35
Page
Individual Life
Sources of Operating Earnings 37
Operating Earnings 38
Key Metrics 39
Employee Benefits
Sources of Operating Earnings 41
Operating Earnings 42
Key Metrics 43
Corporate
Operating Earnings 45
Closed Blocks
ISP and Other Operating Earnings 47
Closed Block Variable Annuity Income (Loss) Before Income Taxes 48
Closed Block Variable Annuity Death and Living Benefits 49
Assets Under Management Rollforward 50
Investment Information
Portfolio Composition 52
Portfolio Results 53
Alternative Investment Income 54
Unrealized Gains (Losses) 55
Asset Backed Securities 56
RMBS Securities Summary 57
CMBS and Other Asset-Backed Securities Summary 58
Mortgage Loans on Real Estate 59
US and Foreign Corporate Securities 60
Exposure to European Debt- Fixed Maturities and Equity Securities 61
Additional Information
Adjustments to Operating Earnings by Segment 63
Calculation and Reconciliation of ROE and ROC 64
Operating Revenues by Segment 65
Ongoing Business Sources of Earnings Reconciliation 66-68
Fixed Maturity Securities—Funds Withheld Reinsurance Transactions 69
Financial Ratings 70
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Voya Financial
Explanatory Note on Non-GAAP Financial Information
Page 3 of 70
Operating earnings before income taxes is a financial measure we use to evaluate segment performance. Operating earnings before income taxes is a non-GAAP financial measure and does not replace net income (loss) as the GAAP measure of our results of operations. Each segment’s operating earnings before income taxes is calculated by adjusting income (loss) before income taxes for the following items:
Net investment gains (losses), net of related amortization of DAC, VOBA, sales inducements and unearned revenue. Net investment gains (losses) include gains (losses) on the sale of securities, impairments, changes in the fair value of investments using the fair value option (“FVO”) unrelated to the implied loan-backed security income recognition for certain mortgage-backed obligations and changes in the fair value of derivative instruments, excluding realized gains (losses) associated with swap settlements and accrued interest;
Net guaranteed benefit hedging gains (losses), which include changes in the fair value of derivatives related to guaranteed benefits, net of related reserve increases (decreases) and net of related amortization of DAC, VOBA and sales inducements, less the estimated cost of these benefits. The estimated cost, which is reflected in operating results, reflects the expected cost of these benefits if markets perform in line with our long-term expectations and includes the cost of hedging. All other derivative and reserve changes related to guaranteed benefits are excluded from operating results, including the impacts related to changes in our nonperformance spread;
Income (loss) related to business exited through reinsurance or divestment;
Income (loss) attributable to noncontrolling interests;
Income (loss) related to early extinguishment of debt;
Impairment of goodwill, value of management contract rights and value of customer relationships acquired;
Immediate recognition of net actuarial gains (losses) related to our pension and other postretirement benefit obligations and gains (losses) from plan amendments and curtailments; and
Other items, including restructuring expenses (severance, lease write-offs, etc.), certain third-party expenses and deal incentives related to the divestment of the Company by ING Group, and expenses associated with the rebranding of Voya Financial, Inc. from ING U.S., Inc.
Adjusted operating earnings is also a non-GAAP financial measure. This measure excludes from operating earnings before income taxes the following items:
DAC/VOBA and other intangibles unlocking;
DAC/VOBA and other intangibles unlocking can be volatile, so excluding the effect of this can improve period to period comparability;
The net gains and losses included in operating earnings from a distribution of cash and securities in conjunction with a Lehman Brothers bankruptcy settlement and the losses as a result of the decision to dispose of certain Low Income Housing Tax Credit partnerships (“LIHTC”) as a means of exiting this asset class; and
Interest expense related to debt in our Corporate segment.
We report Ongoing Business adjusted operating ROE and adjusted operating ROC because we believe these measures are useful indicators of how effectively we use capital resources allocated to our Ongoing Business. The most directly comparable GAAP measure to adjusted operating ROE and adjusted operating ROC is return on equity. For a reconciliation of these non-GAAP measures to return on equity, see the Calculation and Reconciliation of ROE and ROC page in this Supplement.
In addition to book value per share including accumulated other comprehensive income (AOCI), we also report book value per share excluding AOCI and shareholders’ equity excluding AOCI. Included in AOCI are investment portfolio unrealized gains or losses. In the ordinary course of business we do not plan to sell most investments for the sole purpose of realizing gains or losses, and book value per share excluding AOCI and shareholders’ equity excluding AOCI provide a measure consistent with that view.
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Voya Financial
Explanatory Note on Non-GAAP Financial Information
Page 4 of 70
Our Closed Block Variable Annuity segment is managed to focus on protecting regulatory and rating agency capital rather than achieving operating metrics and, therefore, we exclude its results of operations from operating earnings before income taxes. When we present the adjustments to Net Income (loss) before income taxes on a consolidated basis, each adjustment excludes the relative portions attributable to our Closed Block Variable Annuity segment. The most directly comparable GAAP measure to operating earnings before income taxes is net income (loss) before income taxes. For a reconciliation of operating earnings before income taxes to income (loss) before income taxes, refer to the “Consolidated Earnings Before Income Taxes” page in this document. In addition, please refer to “Adjusted Operating Earnings by Segment” for reconciliation from Total operating earnings before income taxes to Total adjusted operating earnings before income taxes.
Operating revenues is a measure of our segment revenues and a non-GAAP financial measure. We calculate operating revenues by adjusting each segment’s total revenue for the following items:
Net realized investment gains (losses) and related charges and adjustments, which include gains (losses) on the sale of securities, impairments, changes in the fair value of investments using the FVO unrelated to the implied loan-backed security income recognition for certain mortgage-backed obligations and changes in the fair value of derivative instruments, excluding realized gains (losses) associated with swap settlements and accrued interest. These items are net of related amortization of unearned revenue;
Gain (loss) on change in fair value of derivatives related to guaranteed benefits, which include changes in the fair value of derivatives related to guaranteed benefits, less the estimated cost of these benefits. The estimated cost, which is reflected in operating results, reflects the expected cost of these benefits if markets perform in line with our long-term expectations and includes the cost of hedging. All other derivative and reserve changes related to guaranteed benefits are excluded from operating revenues, including the impacts related to changes in our nonperformance spread;
Revenues related to businesses exited through reinsurance or divestment;
Revenues attributable to noncontrolling interests; and
Other adjustments to operating revenues primarily reflect fee income earned by our broker dealers for sales of non-proprietary products, which are reflected net of commission expense in our segments’ operating revenues, as well as other items where the income is passed on to third parties.
Operating revenues also excludes the revenues of our Closed Block Variable Annuity segment, since this segment is managed to focus on protecting regulatory and rating agency capital rather than generating operating earnings. When we present the adjustments to Total revenues on a consolidated basis, each adjustment excludes the relative portions attributable to our Closed Block Variable Annuity segment.
The most directly comparable GAAP measure to operating revenues is total revenues. For a reconciliation of operating revenue to total revenues, please refer to the “Operating Revenues by Segment” page in this document.
We analyze our Ongoing Business performance based on the sources of earnings. We believe this supplemental information is useful in order to gain a better understanding of our operating earnings (loss) before income taxes for the following reasons: (1) we analyze our business using this information and (2) this presentation can be helpful for investors to understand the main drivers of operating earnings (loss) before income taxes of our ongoing businesses. The sources of earnings are defined as such:
Investment spread and other investment income consists of net investment income and net realized investment gains (losses) associated with swap settlements and accrued interest, less interest credited to policyholder reserves.
Fee based margin consists primarily of fees earned on AUM, AUA, and transaction based recordkeeping fees.
Net underwriting gain (loss) and other revenue contains the following: the difference between fees charged for insurance risks and incurred benefits, including mortality, morbidity, and surrender results, contractual charges for universal life and annuity contracts, the change in the unearned revenue reserve for universal life contracts, and that portion of traditional life insurance premiums intended to cover expenses and profits. Certain contract charges for universal life insurance are not recognized in income immediately, but are deferred as unearned revenues and are amortized into income in a manner similar to the amortization of DAC.
Administrative expenses are general expenses, net of amounts capitalized as acquisition expenses and exclude commission expenses and fees on letters of credit.
Trail commissions are commissions paid that are not deferred and thus recorded directly to expense.
For a detail explanation of DAC/VOBA and other intangibles amortization/unlocking see “Unlocking of DAC/VOBA and other Contract Owner/Policyholder Intangibles” in our SEC filings.
For a reconciliation of the sources of earnings presentation to the line items within operating revenues and operating benefits and expenses, please refer to the “Ongoing Business Sources of Earnings Reconciliation” pages in this document.
Financial information, unless otherwise noted, is rounded to millions, therefore may not sum to its corresponding total.
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Voya Financial Organizational Chart
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VOYA Financial TM
Ongoing
Business
Investment
Retirement Solutions Management Insurance Solutions Closed Blocks Corporate
Retirement, Retail, Variable Annuity
Institutional funds Institutional Spread
Retirement Annuities Fixed income Individual Employee Products
Equity Life Benefits Other
Multi-asset strategies
Full service Fixed indexed and solutions Term life Stop loss
plans annuities Senior bank loans Universal life Group life
Recordkeeping Annuity and Alternatives Indexed Voluntary
services custodial universal life benefits
Stable value products Variable Group disability
plans universal life
IRAs
Brokerage
accounts
Advisory
services
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Voya Financial Key Metrics
Page 6 of 70
Three Months Ended Year-to-Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
(in millions USD, unless otherwise indicated)
Operating earnings before income taxes—Ongoing Business 356.1 267.5 352.2 484.2 306.8 623.6 592.2
Operating earnings before income taxes—Total Consolidated 328.3 231.1 304.9 435.0 272.0 559.4 528.7
Net income (loss) 412.9 271.6 653.7 447.7(85.3) 684.5(310.8)
Net income (loss) attributable to noncontrolling interest 166.6 13.5 105.6 101.1(3.1) 180.1(16.6)
Net income (loss) available to Voya Financial, Inc.‘s common shareholders 246.3 258.1 548.1 346.6(82.2) 504.4(294.2)
Total Voya Financial, Inc. Shareholders’ Equity—Excluding AOCI 11,665.4 11,424.0 11,423.1 10,820.0 10,383.8 11,665.4 10,383.8
Return on Equity
Ongoing Business adjusted operating return on equity—TTM (1) (2) 10.7% 10.3% 10.3% N/A N/A 10.7% N/A
Ongoing Business adjusted operating return on equity—Annualized (2) 12.0% 9.7% 10.9% 10.3% 10.4% 10.9% 9.9%
Debt to Capital (Excluding AOCI) 23.2% 23.5% 23.5% 24.5% 26.2% 23.2% 26.2%
Per Share
Total Consolidated Operating earnings per share (Diluted) 0.83 0.57 0.75 1.08 0.71 1.40 1.43
Net income (loss) available to Voya Financial, Inc.‘s common shareholders per common
share:
Basic 0.97 0.99 2.10 1.33(0.33) 1.96(1.22)
Diluted 0.96 0.98 2.08 1.32(0.33) 1.94(1.22)
Book value per share (Excluding AOCI) 45.82 44.85 43.65 41.49 39.82 45.82 39.82
Shares
Weighted-average common shares outstanding (in millions)
Basic 254.5 261.1 261.1 260.8 250.3 257.8 240.2
Diluted 256.2 263.5 263.3 262.3 250.3 259.8 240.2
Ending shares outstanding (in millions) 254.6 254.7 261.7 260.8 260.8 254.6 260.8
Returned to Shareholders ($)
Shares repurchased 30.5 258.9 — —289.4 -
Common dividends 2.6 2.6 2.6 2.6—5.2 -
Total 33.1 261.5 2.6 2.6—294.6 -
(1) Trailing twelve months calculation
(2) Assumes debt-to-capital ratio of 25% for all time periods presented, a weighted average pre-tax interest rate of 5.5% for all periods prior to the third quarter of 2013, when the company completed recapitalization, and the actual weighted average pre-tax interest rate for all periods starting with the third quarter of 2013.
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Voya Financial
Adjusted Operating Return on Capital and Return on Equity
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Twelve Months Ended June 30, 2014
Retirement Solutions Investment Insurance Solutions Ongoing Closed Block Corporate and Consolidated
Retirement Annuities Management Individual Life Employee Business Variable Annuity Closed Blocks
Benefits
(in millions USD, unless otherwise indicated)
Ending Capital (1) 3,835 1,696 326 2,861 345 9,063 3,293 2,825 15,181
Average Capital (2) 3,946 1,736 302 2,889 348 9,221 3,335 2,153 14,709
Adjusted operating earnings before interest and after
income taxes 340.5 136.1 129.0 139.7 76.0 821.3—13.2 834.5
Adjusted Operating Return on Capital (2) 8.6% 7.8% 42.7% 4.8% 21.8% 8.9%—N/M 5.7%
Adjusted Operating Return on Equity (2) (3) 10.7%
Twelve Months Ended December 31, 2013
Retirement Solutions Investment Insurance Solutions Ongoing Closed Block Corporate and Consolidated
Retirement Annuities Management Individual Life Employee Business Variable Annuity Other Closed
Benefits Blocks
(in millions USD, unless otherwise indicated)
Ending Capital (1) 4,007 1,713 302 2,848 346 9,216 3,119 2,603 14,938
Average Capital (2) 3,915 1,762 303 2,804 354 9,137 4,092 1,226 14,455
Adjusted operating earnings before interest and after
income taxes 349.2 128.0 107.2 136.7 66.5 787.6—10.6 798.2
Adjusted Operating Return on Capital (2) 8.9% 7.3% 35.4% 4.9% 18.8% 8.6%—N/M 5.5%
Adjusted Operating Return on Equity (2) (3) 10.3%
(1) Capital is allocated to each of our segments in proportion to each segment’s target statutory capital, plus an allocation of the differences between statutory capital and total Voya Financial, Inc. shareholders’ equity on a GAAP basis (excluding AOCI), based on each segment’s portion of these differences. Statutory surplus in excess of target statutory capital and certain corporate assets and liabilities, such as certain deferred tax assets and liabilities for unfunded pension plans, are allocated to the Corporate segment.
(2) Effective with the twelve months ending March 31,2014, average capital and equity are calculated by taking the average of the quarterly capital and equity averages for the trailing four quarters, whereas in previous periods, average capital and equity were calculated by two point average (Beginning of Year and End of Current Period) (3) Assumes debt-to-capital ratio of 25% for all time periods presented, a weighted average pre-tax interest rate of 5.5% for all periods prior to the third quarter of 2013, when the company completed recapitalization, and the actual weighted average pre-tax interest rate for all periods starting with the third quarter of 2013.
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Voya Financial
Adjusted Operating Earnings Before Interest, After Income Taxes
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Twelve Months Ended June 30, 2014
Retirement Solutions Investment Insurance Solutions Ongoing Business Closed Block Corporate and Other Consolidated
Retirement Annuities Management Individual Life Employee Benefits Variable Annuity Closed Blocks
(in millions USD, unless otherwise indicated)
Operating earnings before income taxes 576.6 299.0 211.6 258.5 114.3 1,460.0 -(160.7) 1,299.3
Less:
Interest expense — — — -(188.3)(188.3)
DAC/VOBA and other intangibles unlocking (1) 39.8 76.1—3.8(6.9) 112.8 — 112.8
Net gain (loss) from Lehman Recovery/LIHTC (2) 12.9 13.5 13.2 39.7 4.3 83.6—7.3 90.9
Adjusted operating earnings before interest 523.9 209.4 198.4 215.0 116.9 1,263.6—20.3 1,283.9
Income tax expense (3) 183.4 73.3 69.4 75.3 40.9 442.3—7.1 449.4
Adjusted operating earnings before interest and
after income taxes 340.5 136.1 129.0 139.7 76.0 821.3—13.2 834.5
Year Ended December 31, 2013
Retirement Solutions Investment Insurance Solutions Ongoing Business Closed Block Corporate and Other Consolidated
Retirement Annuities Management Individual Life Employee Benefits Variable Annuity Closed Blocks
(in millions USD, unless otherwise indicated)
Operating earnings before income taxes 595.8 293.8 178.1 254.8 106.1 1,428.6 -(160.0) 1,268.6
Less:
Interest expense — — — -(179.7)(179.7)
DAC/VOBA and other intangibles unlocking (1) 45.6 83.3—4.8(0.5) 133.2 — 133.2
Net gain (loss) from Lehman Recovery/LIHTC (2) 12.9 13.5 13.2 39.7 4.3 83.6—3.4 87.0
Adjusted operating earnings before interest 537.3 197.0 164.9 210.3 102.3 1,211.8—16.3 1,228.1
Income tax expense (3) 188.1 69.0 57.7 73.6 35.8 424.2—5.7 429.9
Adjusted operating earnings before interest and
after income taxes 349.2 128.0 107.2 136.7 66.5 787.6—10.6 798.2
(1) DAC/VOBA and other intangibles unlocking excludes unlocking on net investment income from Lehman Recovery/LIHTC, as described below (2) Includes the net gain (loss) included in operating earnings from a distribution of cash and securities in conjunction with a Lehman Brothers bankruptcy settlement and the losses as a result of the decision to dispose of certain Low Income Housing Tax Credit partnerships (“LIHTC”) as a means of exiting this asset class. Collectively these items, net of DAC/VOBA and other intangibles impacts, are referred to as (3) “Net gain (loss) from Lehman Recovery/LIHTC”.
Based on an assumed effective tax rate of 35%.
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Voya Financial
Consolidated Balance Sheets
Page 9 of 70
Balances as of
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
Assets
Total investments 89,821.3 88,891.4 87,050.8 89,007.3 89,504.8
Cash and cash equivalents 3,142.0 2,499.8 2,840.8 1,716.6 1,549.8
Assets held in separate accounts 110,648.2 107,840.0 106,827.1 103,853.6 102,228.9
Reinsurance recoverable 6,637.1 6,785.8 6,702.2 6,755.6 7,053.0
Short term investments under securities loan agreement and
accrued investment income 1,509.7 1,494.2 1,450.0 1,395.6 1,322.2
Deferred policy acquisition costs, Value of business acquired 4,511.2 4,860.8 5,351.6 5,265.0 5,060.5
Goodwill and other intangible assets 303.2 312.5 323.7 323.4 333.0
Other assets (1) 1,384.7 1,274.7 1,477.6 1,416.6 1,548.3
Assets related to consolidated investment entities 10,120.6 9,551.5 8,999.4 7,924.5 8,523.0
Total Assets 228,078.0 223,510.7 221,023.2 217,658.2 217,123.5
Liabilities
Future policy benefits and contract owner account balances 84,424.5 84,256.1 84,006.7 84,887.9 85,561.9
Liabilities related to separate accounts 110,648.2 107,840.0 106,827.1 103,853.6 102,228.9
Funds held under reinsurance agreements 1,167.6 1,174.5 1,181.5 1,212.1 1,281.6
Payables under securities loan agreements, including collateral 904.9 864.5 769.4 576.7 470.6
Short-term debt — — 138.6
Long-term debt 3,515.2 3,515.0 3,514.7 3,514.5 3,265.7
Other liabilities (2) 3,217.4 2,999.6 3,144.9 3,598.9 3,796.5
Liabilities related to consolidated investment entities 6,936.9 6,493.0 6,064.9 5,150.0 5,732.6
Total Liabilities 210,814.7 207,142.7 205,509.2 202,793.7 202,476.4
Shareholders’ Equity
Common stock 2.6 2.6 2.6 2.6 2.6
Treasury stock(304.2)(269.8) — -
Additional paid-in capital 23,599.9 23,579.5 23,563.7 23,524.7 23,498.7
Retained earnings (deficit)(11,632.9)(11,888.3)(12,143.2)(12,707.3)(13,117.5)
Total Voya Financial, Inc. Shareholders’ Equity—Excluding AOCI 11,665.4 11,424.0 11,423.1 10,820.0 10,383.8
Accumulated other comprehensive income 3,152.7 2,577.5 1,849.1 1,950.0 2,087.8
Total Voya Financial, Inc. Shareholders’ Equity 14,818.1 14,001.5 13,272.2 12,770.0 12,471.6
Noncontrolling interest 2,445.2 2,366.5 2,241.8 2,094.5 2,175.5
Total Shareholders’ Equity 17,263.3 16,368.0 15,514.0 14,864.5 14,647.1
Total Liabilities and Shareholders’ Equity 228,078.0 223,510.7 221,023.2 217,658.2 217,123.5
(1) Includes Other assets, Sales inducements to contract holders, and Deferred income taxes (2) Includes Other liabilities, Derivatives, Pension and other postretirement provisions, Current income taxes, and Deferred income taxes
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Voya Financial
Consolidated Statements of Operations
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Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Revenues
Net investment income 1,120.9 1,145.6 1,156.5 1,221.6 1,112.2 2,266.5 2,310.9
Fee income 897.3 931.8 943.9 920.8 909.7 1,829.1 1,801.6
Premiums 629.4 600.9 515.4 494.2 474.8 1,230.3 946.7
Net realized capital gains (losses)(366.5)(190.6)(577.0)(517.1)(565.9)(557.1)(1,440.7)
Income (loss) related to consolidated investment entities 306.7 77.7 213.5 196.2 103.7 384.4 139.0
Other revenues 110.3 105.5 111.7 119.6 106.1 215.8 201.7
Total revenues 2,698.1 2,670.9 2,364.0 2,435.3 2,140.6 5,369.0 3,959.2
Benefits and expenses
Interest credited and other benefits to contract owners/policyholders(1,305.2)(1,358.1)(1,118.8)(1,087.7)(1,229.9)(2,663.3)(2,291.3)
Operating expenses(758.3)(789.5)(394.6)(762.8)(770.2)(1,547.8)(1,529.3)
Net amortization of DAC/VOBA(115.7)(126.1)(123.2)(64.6)(124.5)(241.8)(255.0)
Interest expense(47.5)(47.6)(48.2)(48.4)(43.8)(95.1)(88.2)
Operating expenses related to consolidated investment entities(52.4)(47.3)(51.6)(51.8)(47.4)(99.7)(84.9)
Total benefits and expenses(2,279.1)(2,368.6)(1,736.4)(2,015.3)(2,215.8)(4,647.7)(4,248.7)
Income (loss) before income taxes 419.0 302.3 627.6 420.0(75.2) 721.3(289.5)
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Voya Financial
Ongoing Business Sources of Operating Earnings
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Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Sources of operating earnings before income
taxes:
Investment spread and other investment income 361.9 361.9 384.7 437.4 361.0 723.8 724.7
Fee based margin 385.3 381.2 388.7 369.7 364.2 766.5 707.8
Net underwriting gain (loss) and other revenue 219.4 173.6 180.7 198.9 204.1 393.0 384.0
Administrative expenses(417.9)(436.4)(422.4)(404.3)(416.1)(854.3)(816.4)
Trail commissions(71.1)(73.7)(68.1)(63.8)(66.0)(144.8)(132.1)
DAC/VOBA and other intangibles amortization,
excluding unlocking(131.8)(119.3)(136.1)(178.2)(144.0)(251.1)(286.7)
DAC/VOBA and other intangibles unlocking 10.3(19.8) 24.7 124.5 3.6(9.5) 10.9
Operating earnings before income taxes 356.1 267.5 352.2 484.2 306.8 623.6 592.2
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Voya Financial
Consolidated Earnings Before Income Taxes
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Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Operating revenues
Net investment income and net realized gains (losses) 952.6 961.4 1,005.8 1,054.4 962.0 1,914.0 1,947.6
Fee income 654.4 649.3 644.1 632.1 628.3 1,303.7 1,236.3
Premiums 534.9 549.3 473.3 453.5 473.3 1,084.2 943.8
Other revenue 35.0 35.4 40.2 38.9 33.9 70.4 60.3
Total operating revenues 2,176.9 2,195.4 2,163.4 2,178.9 2,097.5 4,372.3 4,188.0
Operating benefits and expenses
Interest credited and other benefits to contract owners/policyholders(1,154.2)(1,228.6)(1,166.3)(1,111.9)(1,126.8)(2,382.8)(2,278.6)
Operating expenses(534.0)(560.7)(547.6)(523.8)(532.5)(1,094.7)(1,049.9)
Net amortization of DAC/VOBA(113.3)(128.0)(96.8)(60.0)(122.7)(241.3)(243.6)
Interest expense(47.1)(47.0)(47.8)(48.2)(43.5)(94.1)(87.2)
Total operating benefits and expenses(1,848.6)(1,964.3)(1,858.5)(1,743.9)(1,825.5)(3,812.9)(3,659.3)
Operating earnings before income taxes 328.3 231.1 304.9 435.0 272.0 559.4 528.7
Adjustments:
Closed Block Variable Annuity(84.1) 20.2(226.4)(167.4)(338.4)(63.9)(815.5)
Net investment gains (losses) and related charges and adjustments 73.0 57.6 105.4 64.1 0.8 130.6 42.6
Net guaranteed benefit hedging gains (losses) and related charges and adjustments(20.3) 6.4(26.6) 10.5 32.4(13.9) 35.5
Income (loss) related to businesses exited through reinsurance or divestment(26.9)(10.5)(12.8)(13.1)(17.0)(37.4)(33.9)
Income (loss) attributable to noncontrolling interests 166.6 13.5 105.6 101.1(3.1) 180.1(16.6)
Immediate recognition of net actuarial gains (losses) related to pension and other
postretirement benefit obligations and gains (losses) from plan amendments and
curtailments — 405.2 — —
Other adjustments to operating earnings*(17.6)(16.0)(27.7)(10.2)(21.9)(33.6)(30.3)
Total non-operating 90.7 71.2 322.7(15.0)(347.2) 161.9 818.2
Income (loss) before income taxes 419.0 302.3 627.6 420.0(75.2) 721.3(289.5)
| * |
|
Other adjustments to operating earnings above includes: |
Restructuring expenses (severance, lease write-offs, etc.), certain third-party expenses and deal incentives related to the divestment of the Company by ING Group, and expenses associated with the rebranding of Voya Financial, Inc. from ING U.S., Inc.
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Operating Earnings by Segment
Page 13 of 70
(in millions USD) Three Months Ended June 30, 2014
Retirement Solutions Investment Insurance Solutions
Operating revenues Retirement Annuities Management Individual Life Employee Benefits Ongoing Business Corporate Closed Blocks Consolidated
Net investment income and net realized gains (losses) 379.6 275.8 8.0 215.5 27.7 906.6 23.2 22.8 952.6
Fee income 192.9 14.2 147.1 285.5 14.7 654.4 — 654.4
Premiums 3.4 35.5—191.7 302.8 533.4—1.5 534.9
Other revenue 17.0 5.3 8.1 7.2(2.7) 34.9 0.4(0.3) 35.0
Total operating revenues 592.9 330.8 163.2 699.9 342.5 2,129.3 23.6 24.0 2,176.9
Operating benefits and expenses
Interest credited and other benefits to contract owners/policyholders(209.3)(197.4) -(499.3)(239.6)(1,145.6) 0.3(8.9)(1,154.2)
Operating expenses(217.3)(36.6)(108.3)(91.3)(60.9)(514.4)(15.1)(4.5)(534.0)
Net amortization of DAC/VOBA(30.5)(32.6) -(45.9)(4.2)(113.2) -(0.1)(113.3)
Interest expense — — —(47.1) -(47.1)
Total operating benefits and expenses(457.1)(266.6)(108.3)(636.5)(304.7)(1,773.2)(61.9)(13.5)(1,848.6)
Operating earnings before income taxes 135.8 64.2 54.9 63.4 37.8 356.1(38.3) 10.5 328.3
Three Months Ended June 30, 2013
Retirement Solutions Investment Insurance Solutions
Operating revenues Retirement Annuities Management Individual Life Employee Benefits Ongoing Business Corporate Closed Blocks Consolidated
Net investment income and net realized gains (losses) 388.8 283.5 6.1 215.4 27.9 921.7 8.3 32.0 962.0
Fee income 189.0 11.2 132.3 280.0 15.8 628.3 — 628.3
Premiums 3.8 6.7—192.1 269.0 471.6—1.7 473.3
Other revenue 15.3 2.6 10.2 7.3(1.0) 34.4(0.4)(0.1) 33.9
Total operating revenues 596.9 304.0 148.6 694.8 311.7 2,056.0 7.9 33.6 2,097.5
Operating benefits and expenses
Interest credited and other benefits to contract owners/policyholders(212.1)(183.9) -(512.4)(213.2)(1,121.6) 0.2(5.4)(1,126.8)
Operating expenses(210.0)(32.2)(107.5)(94.6)(60.5)(504.8)(17.6)(10.1)(532.5)
Net amortization of DAC/VOBA(42.7)(28.4) -(47.6)(3.9)(122.6) -(0.1)(122.7)
Interest expense — -(0.2) -(0.2)(43.3) -(43.5)
Total operating benefits and expenses(464.8)(244.5)(107.5)(654.8)(277.6)(1,749.2)(60.7)(15.6)(1,825.5)
Operating earnings before income taxes 132.1 59.5 41.1 40.0 34.1 306.8(52.8) 18.0 272.0
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Operating Earnings by Segment
Page 14 of 70
(in millions USD) Six Months Ended June 30, 2014
Retirement Solutions Investment Insurance Solutions
Operating revenues Retirement Annuities Management Individual Life Employee Benefits Ongoing Business Corporate Closed Blocks Consolidated
Net investment income and net realized gains (losses) 768.1 546.4 15.3 435.3 54.4 1,819.5 48.6 45.9 1,914.0
Fee income 384.0 27.4 292.9 569.1 30.3 1,303.7 — 1,303.7
Premiums 4.1 101.6—375.4 599.1 1,080.2—4.0 1,084.2
Other revenue 35.2 9.8 15.5 12.3(2.4) 70.4 0.3(0.3) 70.4
Total operating revenues 1,191.4 685.2 323.7 1,392.1 681.4 4,273.8 48.9 49.6 4,372.3
Operating benefits and expenses
Interest credited and other benefits to contract owners/policyholders(420.0)(427.2) -(1,027.1)(484.1)(2,358.4) -(24.4)(2,382.8)
Operating expenses(443.3)(72.1)(219.0)(187.0)(129.3)(1,050.7)(30.4)(13.6)(1,094.7)
Net amortization of DAC/VOBA(77.4)(66.9) -(83.5)(13.3)(241.1) -(0.2)(241.3)
Interest expense — — —(94.1) -(94.1)
Total operating benefits and expenses(940.7)(566.2)(219.0)(1,297.6)(626.7)(3,650.2)(124.5)(38.2)(3,812.9)
Operating earnings before income taxes 250.7 119.0 104.7 94.5 54.7 623.6(75.6) 11.4 559.4
Six Months Ended June 30, 2013
Retirement Solutions Investment Insurance Solutions
Operating revenues Retirement Annuities Management Individual Life Employee Benefits Ongoing Business Corporate Closed Blocks Consolidated
Net investment income and net realized gains (losses) 777.7 570.6 8.9 432.3 56.3 1,845.8 25.8 76.0 1,947.6
Fee income 372.8 21.1 254.0 556.8 31.6 1,236.3 — 1,236.3
Premiums 4.3 14.5—377.9 543.9 940.6—3.2 943.8
Other revenue 25.3 5.4 17.6 14.9(2.0) 61.2(0.8)(0.1) 60.3
Total operating revenues 1,180.1 611.6 280.5 1,381.9 629.8 4,083.9 25.0 79.1 4,188.0
Operating benefits and expenses
Interest credited and other benefits to contract owners/policyholders(416.7)(368.3) -(1,014.0)(455.8)(2,254.8) 1.9(25.7)(2,278.6)
Operating expenses(414.0)(63.2)(209.3)(185.5)(120.5)(992.5)(43.6)(13.8)(1,049.9)
Net amortization of DAC/VOBA(79.5)(66.3) -(90.5)(7.0)(243.3)(0.1)(0.2)(243.6)
Interest expense — -(1.1) -(1.1)(86.1) -(87.2)
Total operating benefits and expenses(910.2)(497.8)(209.3)(1,291.1)(583.3)(3,491.7)(127.9)(39.7)(3,659.3)
Operating earnings before income taxes 269.9 113.8 71.2 90.8 46.5 592.2(102.9) 39.4 528.7
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Operating Revenues and Operating Earnings by Segment
Page 15 of 70
(in millions USD) Three Months Ended Year-to-Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Operating Revenues
Retirement 592.9 598.5 612.4 606.9 596.9 1,191.4 1,180.1
Annuities 330.8 354.4 313.9 319.1 304.0 685.2 611.6
Total Retirement Solutions 923.7 952.9 926.3 926.0 900.9 1,876.6 1,719.7
Investment Management 163.2 160.5 167.1 160.1 148.6 323.7 280.5
Individual Life 699.9 692.2 692.9 717.1 694.8 1,392.1 1,381.9
Employee Benefits 342.5 338.9 316.5 316.2 311.7 681.4 629.8
Total Insurance Solutions 1,042.4 1,031.1 1,009.4 1,033.3 1,006.5 2,073.5 2,011.7
Ongoing Business 2,129.3 2,144.5 2,102.8 2,119.4 2,056.0 4,273.8 4,083.9
Corporate 23.6 25.3 33.6 28.8 7.9 48.9 25.0
Total Closed Blocks 24.0 25.6 27.0 30.7 33.6 49.6 79.1
Total operating revenues 2,176.9 2,195.4 2,163.4 2,178.9 2,097.5 4,372.3 4,188.0
Operating Earnings
Retirement 135.8 114.9 138.6 187.3 132.1 250.7 269.9
Annuities 64.2 54.8 83.2 96.8 59.5 119.0 113.8
Total Retirement Solutions 200.0 169.7 221.8 284.1 191.6 369.7 383.7
Investment Management 54.9 49.8 52.9 54.0 41.1 104.7 71.2
Individual Life 63.4 31.1 47.0 117.0 40.0 94.5 90.8
Employee Benefits 37.8 16.9 30.5 29.1 34.1 54.7 46.5
Total Insurance Solutions 101.2 48.0 77.5 146.1 74.1 149.2 137.3
Ongoing Business 356.1 267.5 352.2 484.2 306.8 623.6 592.2
Corporate(38.3)(37.3)(44.0)(63.7)(52.8)(75.6)(102.9)
Total Closed Blocks 10.5 0.9(3.3) 14.5 18.0 11.4 39.4
Total operating earnings before income taxes 328.3 231.1 304.9 435.0 272.0 559.4 528.7
Closed Block Variable Annuity(84.1) 20.2(226.4)(167.4)(338.4)(63.9)(815.5)
Net investment gains (losses) and related charges and adjustments 73.0 57.6 105.4 64.1 0.8 130.6 42.6
Net guaranteed benefit hedging gains (losses) and related charges and adjustments(20.3) 6.4(26.6) 10.5 32.4(13.9) 35.5
Income (loss) related to businesses exited through reinsurance or divestment(26.9)(10.5)(12.8)(13.1)(17.0)(37.4)(33.8)
Income (loss) attributable to noncontrolling interests 166.6 13.5 105.6 101.1(3.1) 180.1(16.6)
Immediate recognition of net actuarial gains (losses) related to pension and other
postretirement benefit obligations and gains (losses) from plan amendments and
curtailments — 405.2 — —
Other adjustments to operating earnings*(17.6)(16.0)(27.7)(10.2)(21.9)(33.6)(30.3)
Total non-operating 90.7 71.2 322.7(15.0)(347.2) 161.9(818.2)
Income (loss) before income taxes 419.0 302.3 627.6 420.0(75.2) 721.3(289.5)
Less: Income tax expense (benefit) 6.1 30.7(26.1)(27.7) 10.1 36.8 21.3
Net income (loss) 412.9 271.6 653.7 447.7(85.3) 684.5(310.8)
Net income (loss) attributable to noncontrolling interest 166.6 13.5 105.6 101.1(3.1) 180.1(16.6)
Net income (loss) available to Voya Financial, Inc.‘s common shareholders 246.3 258.1 548.1 346.6(82.2) 504.4(294.2)
* Other adjustments to operating earnings above includes:
Restructuring expenses (severance, lease write-offs, etc.), certain third-party expenses and deal incentives related to the divestment of the Company by ING Group, and expenses associated with the rebranding of Voya Financial, Inc. from ING U.S., Inc.
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Adjusted Operating Earnings by Segment
Page 16 of 70
(in millions USD) Three Months Ended Year-to-Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Operating Earnings
Retirement 135.8 114.9 138.6 187.3 132.1 250.7 269.9
Annuities 64.2 54.8 83.2 96.8 59.5 119.0 113.8
Total Retirement Solutions 200.0 169.7 221.8 284.1 191.6 369.7 383.7
Investment Management 54.9 49.8 52.9 54.0 41.1 104.7 71.2
Individual Life 63.4 31.1 47.0 117.0 40.0 94.5 90.8
Employee Benefits 37.8 16.9 30.5 29.1 34.1 54.7 46.5
Total Insurance Solutions 101.2 48.0 77.5 146.1 74.1 149.2 137.3
Ongoing Business 356.1 267.5 352.2 484.2 306.8 623.6 592.2
Corporate(38.3)(37.3)(44.0)(63.7)(52.8)(75.6)(102.9)
Total Closed Blocks 10.5 0.9(3.3) 14.5 18.0 11.4 39.4
Total operating earnings before income taxes 328.3 231.1 304.9 435.0 272.0 559.4 528.7
Adjustments to operating earnings
Retirement 7.1(11.3) 4.2 52.7(1.4)(4.2) 1.6
Annuities 6.5 3.2 27.6 52.3 9.9 9.7 16.9
Total Retirement Solutions 13.6(8.1) 31.8 105.0 8.5 5.5 18.5
Investment Management — 1.7 11.5 — -
Individual Life(1.5)(7.1)(4.7) 56.8(4.9)(8.6)(7.6)
Employee Benefits(1.8)(4.6)(0.2) 4.0 -(6.4) -
Total Insurance Solutions(3.3)(11.7)(4.9) 60.8(4.9)(15.0)(7.6)
Ongoing Business 10.3(19.8) 28.6 177.3 3.6(9.5) 10.9
Corporate(41.0)(48.8)(43.8)(47.6)(43.2)(89.7)(85.1)
Total Closed Blocks —(0.4) 0.6 — -
Total adjustments to operating earnings(30.7)(68.6)(15.6) 130.3(39.6)(99.2)(74.2)
Adjusted Operating Earnings
Retirement 128.7 126.2 134.4 134.6 133.5 254.9 268.3
Annuities 57.7 51.6 55.6 44.5 49.6 109.3 96.9
Total Retirement Solutions 186.4 177.8 190.0 179.1 183.1 364.2 365.2
Investment Management 54.9 49.8 51.2 42.5 41.1 104.7 71.2
Individual Life 64.9 38.2 51.7 60.2 44.9 103.1 98.4
Employee Benefits 39.6 21.5 30.7 25.1 34.1 61.1 46.5
Total Insurance Solutions 104.5 59.7 82.4 85.3 79.0 164.2 144.9
Ongoing Business 345.8 287.3 323.6 306.9 303.2 633.1 581.3
Corporate 2.7 11.5(0.2)(16.1)(9.6) 14.1(17.8)
Total Closed Blocks 10.5 0.9(2.9) 13.9 18.0 11.4 39.4
Total adjusted operating earnings before interest and income taxes 359.0 299.7 320.5 304.7 311.6 658.6 602.9
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
DAC/VOBA Segment Trends
Page 17 of 70
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Retirement
Balance as of beginning-of-period 1,219.1 1,415.3 1,381.4 1,278.3 843.1 1,415.3 712.4
Deferrals of commissions and expenses 22.7 23.6 27.1 25.5 25.8 46.3 54.1
Amortization(52.7)(39.2)(53.6)(44.7)(23.5)(91.9)(65.8)
Unlocking 25.7 5.1 19.0 66.0 14.0 30.8 33.1
Change in unrealized capital gains/losses(111.9)(185.7) 41.5 56.3 418.9(297.6) 544.5
Balance as of End-of-Period 1,102.9 1,219.1 1,415.3 1,381.4 1,278.3 1,102.9 1,278.3
Annuities
Balance as of beginning-of-period 508.4 591.7 560.5 518.6 292.4 591.7 260.7
Deferrals of commissions and expenses 30.7 31.5 27.8 23.5 20.8 62.2 38.2
Amortization(28.9)(41.3)(38.3)(55.8)(60.3)(70.2)(114.8)
Unlocking 6.5 12.5 16.6 45.3 17.9 19.0 31.4
Change in unrealized capital gains/losses(71.5)(86.1) 25.0 28.9 247.8(157.6) 303.1
Balance as of End-of-Period 445.2 508.4 591.7 560.5 518.6 445.2 518.6
Individual Life
Balance as of beginning-of-period 2,560.5 2,752.9 2,717.4 2,638.2 2,247.2 2,752.9 2,127.6
Deferrals of commissions and expenses 36.4 32.7 36.8 39.8 50.1 69.1 102.9
Amortization(45.1)(32.8)(46.6)(71.8)(50.6)(77.9)(99.0)
Unlocking(0.9)(4.1) 0.5 22.4 0.1(5.0) 2.5
Change in unrealized capital gains/losses(150.5)(188.2) 44.9 88.8 391.4(338.7) 504.2
Balance as of End-of-Period 2,400.4 2,560.5 2,752.9 2,717.4 2,638.2 2,400.4 2,638.2
Other (1)
Balance as of beginning-of-period 96.7 102.7 104.0 105.7 104.1 102.7 102.6
Deferrals of commissions and expenses 7.4 4.2 5.0 4.6 6.1 11.6 11.6
Amortization(4.3)(3.7)(3.0)(6.3)(6.8)(8.0)(10.1)
Unlocking(1.1)(6.8)(2.4) —(7.9) -
Change in unrealized capital gains/losses 0.2 0.3(0.9)—2.3 0.5 1.6
Balance as of End-of-Period 98.9 96.7 102.7 104.0 105.7 98.9 105.7
Closed Block Variable Annuity
Balance as of beginning-of-period 476.2 489.0 501.7 519.7 532.8 489.0 453.0
Deferrals of commissions and expenses 2.4 3.0 2.7 1.8 4.3 5.4 8.2
Amortization(16.5)(16.2)(17.0)(15.4)(15.5)(32.7)(30.3)
Unlocking 1.6 0.4 1.6(4.3)(1.8) 2.0(2.0)
Change in unrealized capital gains/losses 0.1 —(0.1)(0.1) 0.1 90.8
Balance as of End-of-Period 463.8 476.2 489.0 501.7 519.7 463.8 519.7
Total US
Balance as of beginning-of-period 4,860.8 5,351.6 5,265.0 5,060.5 4,019.6 5,351.6 3,656.3
Deferrals of commissions and expenses 99.6 95.0 99.3 95.2 107.1 194.6 215.0
Amortization(147.5)(133.2)(158.5)(194.0)(156.7)(280.7)(320.0)
Unlocking 31.8 7.1 35.3 129.4 30.2 38.9 65.0
Change in unrealized capital gains/losses(333.5)(459.7) 110.5 173.9 1,060.3(793.2) 1,444.2
Balance as of End-of-Period 4,511.2 4,860.8 5,351.6 5,265.0 5,060.5 4,511.2 5,060.5
| (1) |
|
Employee Benefits, Investment Management, Other Closed Blocks |
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Consolidated Capital Structure
Page 18 of 70
Balances as of
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
Financial Debt
Senior bonds 2,746.5 2,746.3 2,746.0 2,745.8 2,485.5
Subordinated bonds 763.8 763.8 763.8 763.8 763.9
Loans from ING Verzekeringen N.V. — — 150.0
Loans from consolidated subs — — 279.0
Other debt 4.9 4.9 4.9 4.9 4.9
Total Debt 3,515.2 3,515.0 3,514.7 3,514.5 3,683.3
Equity
Total common equity 11,665.4 11,424.0 11,423.1 10,820.0 10,383.8
Accumulated other comprehensive income (AOCI) 3,152.7 2,577.5 1,849.1 1,950.0 2,087.8
Total Voya Financial, Inc. Shareholders’ Equity 14,818.1 14,001.5 13,272.2 12,770.0 12,471.6
Total Equity (Excluding AOCI) 11,665.4 11,424.0 11,423.1 10,820.0 10,383.8
Capital
Total Capitalization 18,333.3 17,516.5 16,786.9 16,284.5 16,154.9
Total Capitalization (Excluding AOCI) 15,180.6 14,939.0 14,937.8 14,334.5 14,067.1
Debt to Capital
Debt to Capital 19.2% 20.1% 20.9% 21.6% 22.8%
Debt to Capital (Excluding AOCI) 23.2% 23.5% 23.5% 24.5% 26.2%
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Consolidated Assets Under Management/Assets Under Administration
Page 19 of 70
(in millions USD)
Total
Institutional/ AUM—Assets Under AUA—Assets Under
Balances as of June 30, 2014 General Account Separate Account Mutual Funds Management Administration Total AUM + AUA
Retirement (1) 27,389.5 60,119.8 20,918.9 108,428.2 241,664.0 350,092.2
Annuities (2) 22,614.5 825.3 3,825.1 27,264.9—27,264.9
Retirement Solutions 50,004.0 60,945.1 24,744.0 135,693.1 241,664.0 377,357.1
Investment Management 78,335.1 49,560.8 79,686.3 207,582.2 55,778.9 263,361.1
Insurance
Individual Life (3) 13,381.3 2,761.6—16,142.9—16,142.9
Employee Benefits 1,791.3 16.2—1,807.5—1,807.5
Insurance Solutions 15,172.6 2,777.8—17,950.4—17,950.4
Eliminations(69,265.5)(46,598.6)(9,955.1)(125,819.2)(56,382.8)(182,202.0)
Total Ongoing Business 74,246.2 66,685.1 94,475.2 235,406.5 241,060.1 476,466.6
Closed Block Variable Annuity 1,651.4 43,739.0—45,390.4—45,390.4
Closed Block Institutional Spread Products 2,117.2 — 2,117.2—2,117.2
Closed Block Other 320.3 224.1—544.4—544.4
Total AUM and AUA 78,335.1 110,648.2 94,475.2 283,458.5 241,060.1 524,518.6
(1) Retirement AUM include wrapped funds as well as unwrapped IIM-managed funds (2) Annuities AUM includes Payout annuities (3) Individual Life AUM includes assets backing interest and non-interest sensitive products
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Retirement
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Retirement Sources of Operating Earnings
Page 21 of 70
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Sources of operating earnings before income taxes:
Investment spread and other investment income (1) 173.8 178.6 181.4 181.3 179.5 352.4 362.8
Fee based margin 211.9 209.5 215.0 209.7 205.5 421.4 404.5
Net underwriting gain (loss) and other revenue(5.0)(3.2)(2.3) 0.4(3.0)(8.2)(9.0)
Administrative expenses(178.5)(188.0)(181.8)(171.8)(174.6)(366.5)(344.6)
Trail commissions(34.5)(33.7)(35.3)(31.4)(31.9)(68.2)(61.8)
DAC/VOBA and other intangibles amortization, excluding
unlocking (1)(39.0)(37.0)(42.8)(45.2)(42.0)(76.0)(83.6)
DAC/VOBA and other intangibles unlocking (1) 7.1(11.3) 4.4 44.3(1.4)(4.2) 1.6
Operating earnings before income taxes 135.8 114.9 138.6 187.3 132.1 250.7 269.9
Gross investment income
Fixed income 351.0 363.7 364.1 356.9 364.7 714.7 721.0
Limited partnership income 2.6 3.0 2.8(0.1) 1.9 5.6 4.2
Prepayment fee income 8.4 4.3 9.1 2.9 7.9 12.7 18.1
Total gross investment income 362.0 371.0 376.0 359.7 374.5 733.0 743.3
Investment expenses(14.7)(15.1)(14.9)(14.1)(14.7)(29.8)(28.9)
Credited interest(200.3)(204.3)(210.0)(207.5)(203.6)(404.6)(403.5)
Net margin 147.0 151.6 151.1 138.1 156.2 298.6 310.9
Other investment income(1) (2) 26.8 27.0 30.3 43.2 23.3 53.8 51.9
Investment spread and other investment income 173.8 178.6 181.4 181.3 179.5 352.4 362.8
Fee based margin
Fee based margin—excluding Recordkeeping 158.3 155.4 157.3 152.6 145.3 313.7 284.5
Fee based margin—Recordkeeping 53.5 54.1 57.7 57.1 60.3 107.6 120.1
Fee based margin 211.9 209.5 215.0 209.7 205.5 421.4 404.5
Recordkeeping
Revenue 53.5 54.1 57.7 57.1 60.3 107.6 120.1
Expenses(50.0)(53.9)(54.6)(53.0)(53.7)(103.9)(106.8)
Operating earnings—Recordkeeping 3.5 0.2 3.1 4.1 6.6 3.7 13.3
(1) The three months ended 9/30/13 and 12/31/13 include $14.8 million and $0.4 million of net investment income, $(6.4) million and $(0.6) million of DAC/VOBA and other intangibles amortization, and $4.3 million and $0.4 million of DAC/VOBA and other intangibles unlocking from Lehman Recovery/LIHTC, respectively.
(2) Includes investment income on assets backing surplus that has been allocated from the corporate segment and income from policy loans
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Retirement Operating Earnings
Page 22 of 70
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Operating revenues
Net investment income and net realized gains (losses) 379.6 388.5 397.4 394.5 388.8 768.1 777.7
Fee income 192.9 191.1 196.1 191.0 189.0 384.0 372.8
Premiums 3.4 0.7 0.7 0.7 3.8 4.1 4.3
Other revenue 17.0 18.2 18.2 20.7 15.3 35.2 25.3
Total operating revenues 592.9 598.5 612.4 606.9 596.9 1,191.4 1,180.1
Operating benefits and expenses
Interest credited and other benefits to contract owners/policyholders(209.3)(210.7)(218.2)(213.5)(212.1)(420.0)(416.7)
Operating expenses(217.3)(226.0)(220.1)(205.8)(210.0)(443.3)(414.0)
Net amortization of DAC/VOBA(30.5)(46.9)(35.5)(0.3)(42.7)(77.4)(79.5)
Total operating benefits and expenses(457.1)(483.6)(473.8)(419.6)(464.8)(940.7)(910.2)
Operating earnings before income taxes 135.8 114.9 138.6 187.3 132.1 250.7 269.9
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial Retirement AUM/AUA
Page 23 of 70
Balances as of
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
Assets under management by product group
Corporate markets 42,499.1 40,967.4 40,123.7 37,677.7 35,916.3
Tax-exempt markets 53,910.8 53,564.2 53,200.5 51,183.9 49,451.5
Total full service plans 96,409.9 94,531.6 93,324.2 88,861.6 85,367.8
Stable value 8,843.6 8,908.6 8,914.3 8,705.0 8,406.9
Individual markets 3,174.8 3,074.9 2,998.4 2,850.5 2,702.4
Total AUM 108,428.2 106,515.1 105,236.9 100,417.1 96,477.1
AUA 241,664.0 235,906.0 237,777.1 227,841.9 220,739.5
Total AUM and AUA 350,092.2 342,421.1 343,014.0 328,259.0 317,216.6
Assets under management by fund group
General account 27,389.5 28,205.7 28,169.2 28,088.3 27,700.9
Guaranteed separate account 8,159.8 8,114.6 8,120.0 8,092.5 8,027.0
Non-guaranteed separate account 51,960.0 50,164.8 49,534.0 46,840.4 44,582.7
Mutual funds/Institutional funds 20,918.9 20,030.0 19,413.7 17,395.9 16,166.5
Total AUM 108,428.2 106,515.1 105,236.9 100,417.1 96,477.1
AUA 241,664.0 235,906.0 237,777.1 227,841.9 220,739.5
Total AUM and AUA 350,092.2 342,421.1 343,014.0 328,259.0 317,216.6
RETIREMENT INVESTMENTS INSURANCE
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Voya Financial
Retirement AUM Rollforward
Page 24 of 70
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Full service—Corporate markets
Assets under management, beginning of period 40,967.4 40,123.7 37,677.7 35,916.3 35,441.2 40,123.7 33,265.9
Transfer/Single deposits 913.8 900.7 1,251.5 688.2 648.9 1,814.5 1,734.6
Recurring deposits 953.5 1,108.9 845.1 883.5 918.4 2,062.4 1,940.1
Deposits 1,867.3 2,009.6 2,096.6 1,571.7 1,567.3 3,876.9 3,674.7
Surrenders, benefits, and product charges(1,678.9)(1,669.6)(1,839.9)(1,645.3)(1,309.7)(3,348.5)(3,038.3)
Net Flows 188.4 340.0 256.7(73.6) 257.6 528.4 636.4
Interest credited and investment performance 1,343.3 503.7 2,189.3 1,835.0 217.5 1,847.0 2,014.0
Transfer to reinsurer (3) — — — -
Assets under management, end of period 42,499.1 40,967.4 40,123.7 37,677.7 35,916.3 42,499.1 35,916.3
Full service—Tax-exempt markets
Assets under management, beginning of period 53,564.2 53,200.5 51,183.9 49,451.5 49,269.4 53,200.5 46,986.1
Transfer/Single deposits 241.6 269.7 271.2 335.0 356.0 511.3 998.0
Recurring deposits 764.9 779.4 756.5 691.0 805.6 1,544.3 1,578.5
Deposits 1,006.5 1,049.1 1,027.7 1,026.0 1,161.6 2,055.6 2,576.5
Surrenders, benefits, and product charges(1,100.4)(1,330.7)(1,117.5)(1,101.8)(1,261.9)(2,431.1)(2,224.6)
Net Flows(93.9)(281.6)(89.8)(75.8)(100.3)(375.5) 351.9
Interest credited and investment performance 1,349.3 645.3 2,106.4 1,808.2 282.4 1,994.6 2,113.4
Transfer to reinsurer (3)(908.8) — —(908.8) -
Assets under management, end of period 53,910.8 53,564.2 53,200.5 51,183.9 49,451.5 53,910.8 49,451.4
Stable value (1)
Assets under management, beginning of period 8,908.6 8,914.3 8,705.0 8,406.9 8,279.7 8,914.3 7,792.1
Transfer/Single deposits 25.6 134.9 202.1 336.7 353.3 160.5 895.3
Recurring deposits 34.9 47.1 60.1 63.4 49.9 81.9 97.9
Deposits 60.5 182.0 262.2 400.1 403.2 242.4 993.2
Surrenders, benefits, and product charges(205.0)(242.2)(113.8)(81.3)(212.3)(447.2)(321.3)
Net Flows(144.5)(60.2) 148.4 318.8 190.9(204.8) 671.9
Interest credited and investment performance 79.5 54.5 60.9(20.7)(63.7) 134.0(57.1)
Transfer to reinsurer (3) — — — -
Assets under management, end of period 8,843.6 8,908.6 8,914.3 8,705.0 8,406.9 8,843.5 8,406.9
Individual markets
Assets under management, beginning of period 3,074.9 2,998.4 2,850.5 2,702.4 2,612.0 2,998.4 2,427.1
Transfer/Single deposits 263.2 281.8 290.3 280.5 323.6 545.0 655.2
Recurring deposits 0.6 0.6 0.2 0.2 0.5 1.2 0.9
Deposits 263.8 282.4 290.5 280.7 324.1 546.2 656.1
Surrenders, benefits, and product charges(236.1)(236.2)(242.6)(215.8)(230.7)(472.3)(455.6)
Net Flows 27.7 46.2 47.9 64.9 93.4 73.9 200.5
Interest credited and investment performance 72.2 30.3 100.0 83.2(3.0) 102.5 74.7
Transfer to reinsurer (3) — — — -
Assets under management, end of period 3,174.8 3,074.9 2,998.4 2,850.5 2,702.4 3,174.8 2,702.3
Total AUM (2)
Assets under management, beginning of period 106,515.1 105,236.9 100,417.1 96,477.1 95,602.3 105,236.9 90,471.2
Transfer/Single deposits 1,444.1 1,587.1 2,015.1 1,640.4 1,681.8 3,031.2 4,283.1
Recurring deposits 1,753.9 1,936.0 1,661.9 1,638.1 1,774.4 3,689.9 3,617.4
Deposits 3,198.0 3,523.1 3,677.0 3,278.5 3,456.2 6,721.1 7,900.5
Surrenders, benefits, and product charges(3,220.4)(3,478.7)(3,313.8)(3,044.2)(3,014.6)(6,699.1)(6,039.7)
Net Flows(22.4) 44.4 363.2 234.3 441.6 22.0 1,861.0
Interest credited and investment performance 2,844.3 1,233.8 4,456.6 3,705.7 433.2 4,078.1 4,144.9
Transfer to reinsurer (3)(908.8) — —(908.8) -
Assets under management, end of period 108,428.2 106,515.1 105,236.9 100,417.1 96,477.1 108,428.2 96,477.1
| (1) |
|
Where Voya is the Investment Manager |
(2) Excludes Recordkeeping and Stable Value where Voya is not the Investment Manager (3) Assets transferred to third parties through reinsurance transactions
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Annuities
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Annuities Sources of Operating Earnings
Page 26 of 70
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Sources of operating earnings before income taxes:
Investment spread and other investment income (1) 116.4 111.0 120.5 127.9 115.4 227.4 228.8
Fee based margin 14.0 13.2 12.9 12.1 11.3 27.2 21.8
Net underwriting gain (loss) and other revenue 9.0 7.0 4.3 2.3 4.4 16.0 11.6
Administrative expenses(24.7)(24.7)(22.0)(22.5)(23.2)(49.4)(45.1)
Trail commissions(11.7)(10.4)(9.9)(8.9)(8.6)(22.1)(17.4)
DAC/VOBA and other intangibles amortization, excluding
unlocking (1)(45.3)(44.5)(49.8)(57.9)(49.7)(89.8)(102.8)
DAC/VOBA and other intangibles unlocking (1) 6.5 3.2 27.2 43.8 9.9 9.7 16.9
Operating earnings before income taxes 64.2 54.8 83.2 96.8 59.5 119.0 113.8
Gross investment income
Fixed income 259.7 257.9 256.4 259.1 258.3 517.6 526.0
Limited partnership income 3.5 4.7 5.3 1.3 5.1 8.2 6.7
Prepayment fee income 7.1 2.5 9.9 6.3 11.1 9.6 16.9
Total gross investment income 270.3 265.1 271.6 266.7 274.5 535.4 549.6
Investment expenses(11.2)(10.7)(10.8)(10.5)(11.2)(21.9)(22.0)
Credited interest(159.7)(159.7)(163.0)(168.1)(167.8)(319.4)(341.5)
Net margin 99.4 94.7 97.8 88.1 95.5 194.1 186.1
Other investment income (1) (2) 17.0 16.3 22.7 39.9 19.9 33.3 42.7
Investment spread and other investment income 116.4 111.0 120.5 127.9 115.4 227.4 228.8
(1) The three months ended 9/30/13 and 12/31/13 include $19.0 million and $1.3 million of net investment income, $(10.5) million and $(0.9) million of DAC/VOBA and other intangibles amortization, and $4.2 million and $0.4 million of DAC/VOBA and other intangibles unlocking from Lehman Recovery/LIHTC, respectively.
(2) Includes investment income on assets backing surplus that has been allocated from the corporate segment and income from policy loans
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Annuities Operating Earnings
Page 27 of 70
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Operating revenues
Net investment income and net realized gains (losses) 275.8 270.6 283.4 295.9 283.5 546.4 570.6
Fee income 14.2 13.2 12.2 11.8 11.2 27.4 21.1
Premiums 35.5 66.1 14.4 7.5 6.7 101.6 14.5
Other revenue 5.3 4.5 3.9 3.9 2.6 9.8 5.4
Total operating revenues 330.8 354.4 313.9 319.1 304.0 685.2 611.6
Operating benefits and expenses
Interest credited and other benefits to contract owners/policyholders(197.4)(229.8)(180.4)(182.2)(183.9)(427.2)(368.3)
Operating expenses(36.6)(35.5)(32.1)(31.7)(32.2)(72.1)(63.2)
Net amortization of DAC/VOBA(32.6)(34.3)(18.2)(8.4)(28.4)(66.9)(66.3)
Total operating benefits and expenses(266.6)(299.6)(230.7)(222.3)(244.5)(566.2)(497.8)
Operating earnings before income taxes 64.2 54.8 83.2 96.8 59.5 119.0 113.8
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial Annuities AUM
Page 28 of 70
Balances as of
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
Assets Under Management
Fixed single year 3,750.7 3,825.4 3,889.5 3,985.4 4,104.1
Fixed multi-year 3,224.4 3,342.9 3,445.7 3,608.1 3,748.6
Indexed 13,105.5 12,883.5 12,648.4 12,494.9 12,362.8
SPIA & Payout 2,886.1 2,871.1 2,803.5 2,760.4 2,762.9
Mutual funds 3,825.1 3,574.3 3,384.9 3,077.8 2,816.2
Other annuities 473.1 470.4 474.8 452.6 438.9
Total AUM 27,264.9 26,967.6 26,646.7 26,379.2 26,233.5
Assets Under Management
General account 22,614.5 22,573.2 22,432.2 22,508.2 22,647.3
Separate account 825.3 820.1 829.6 793.2 770.0
Mutual funds 3,825.1 3,574.3 3,384.9 3,077.8 2,816.2
Total AUM 27,264.9 26,967.6 26,646.7 26,379.2 26,233.5
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Annuities AUM Rollforward
Page 29 of 70
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Annual Reset Annuities/Multi-Year Guaranteed Annuities
Assets Under Management, beginning of period 7,168.3 7,335.2 7,593.5 7,852.7 8,057.7 7,335.2 8,222.9
Deposits 8.7 12.0 17.7 14.5 16.5 20.7 28.7
Surrenders, benefits, and product charges(267.6)(245.2)(348.1)(346.9)(300.6)(512.8)(554.6)
Net cash flow(258.9)(233.2)(330.4)(332.4)(284.1)(492.1)(525.9)
Interest credited and investment performance 65.7 66.3 72.1 73.2 79.1 132.0 155.7
Assets Under Management, end of period 6,975.1 7,168.3 7,335.2 7,593.5 7,852.7 6,975.1 7,852.7
Fixed Indexed Annuities
Assets Under Management, beginning of period 12,883.5 12,648.4 12,494.9 12,362.8 12,255.3 12,648.4 12,209.2
Deposits 430.4 436.2 379.3 334.8 286.7 866.6 532.5
Surrenders, benefits, and product charges(348.0)(316.5)(348.6)(327.3)(332.8)(664.5)(621.8)
Net cash flow 82.4 119.8 30.7 7.6(46.2) 202.1(89.2)
Interest credited and investment performance 139.6 115.3 122.8 124.6 153.7 255.0 242.8
Assets Under Management, end of period 13,105.5 12,883.5 12,648.4 12,494.9 12,362.8 13,105.5 12,362.8
SPIA & Payout
Assets Under Management, beginning of period 2,871.1 2,803.5 2,760.4 2,762.9 2,794.8 2,803.5 2,806.6
Deposits 81.4 119.6 94.5 51.1 37.2 201.0 77.0
Surrenders, benefits, and product charges(107.6)(86.4)(108.7)(110.6)(107.7)(194.0)(208.7)
Net cash flow(26.2) 33.2(14.2)(59.5)(70.5) 7.0(131.8)
Interest credited and investment performance 41.2 34.4 57.3 57.0 38.5 75.6 88.0
Assets Under Management, end of period 2,886.1 2,871.1 2,803.5 2,760.4 2,762.9 2,886.1 2,762.9
Mutual Fund Custodial
Assets Under Management, beginning of period 3,574.3 3,384.9 3,077.8 2,816.2 2,675.5 3,384.9 2,433.5
Deposits 274.6 292.6 288.3 270.6 283.1 567.1 538.5
Surrenders, benefits, and product charges(148.5)(146.8)(135.1)(133.8)(114.2)(295.3)(229.5)
Net cash flow 126.1 145.7 153.3 136.8 168.9 271.8 309.0
Interest credited and investment performance 124.7 43.7 153.8 124.8(28.1) 168.4 73.7
Assets Under Management, end of period 3,825.1 3,574.3 3,384.9 3,077.8 2,816.2 3,825.1 2,816.2
Other Annuities
Assets Under Management, beginning of period 470.4 474.8 452.6 438.9 444.7 474.8 428.7
Deposits 1.7 1.3 1.0 0.6 1.1 3.0 2.7
Surrenders, benefits, and product charges(16.9)(11.9)(12.4)(14.1)(13.0)(28.8)(28.8)
Net cash flow(15.2)(10.5)(11.4)(13.5)(11.8)(25.7)(26.1)
Interest credited and investment performance 17.8 6.1 33.6 27.2 6.1 23.9 36.3
Assets Under Management, end of period 473.1 470.4 474.8 452.6 438.9 473.1 438.9
Annuities—Total
Assets Under Management, beginning of period 26,967.6 26,646.7 26,379.2 26,233.5 26,228.0 26,646.7 26,101.1
Deposits 796.9 861.7 780.9 671.7 624.6 1,658.5 1,179.4
Surrenders, benefits, and product charges(888.7)(806.8)(952.8)(932.7)(868.3)(1,695.5)(1,643.4)
Net cash flow(91.8) 54.9(171.9)(261.0)(243.7)(37.0)(464.0)
Interest credited and investment performance 389.1 266.0 439.4 406.7 249.2 655.2 596.4
Assets Under Management, end of period 27,264.9 26,967.6 26,646.7 26,379.2 26,233.5 27,264.9 26,233.5
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Investment Management
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Investment Management Sources of Operating Earnings
Page 31 of 70
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Sources of operating earnings before income
taxes:
Investment capital and other investment income (1) 8.2 7.5 12.1 16.8 6.2 15.7 8.8
Fee based margin 155.0 153.0 155.0 143.3 142.4 308.0 271.7
Administrative expenses(108.3)(110.7)(114.2)(106.1)(107.5)(219.0)(209.3)
Operating earnings before income taxes 54.9 49.8 52.9 54.0 41.1 104.7 71.2
(1) The three months ended 9/30/13 and 12/31/13 include $11.5 million and $1.7 million respectively of net investment income from Lehman Recovery/LIHTC.
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Investment Management Operating Earnings
Page 32 of 70
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Operating revenues
Net investment income and net realized gains (losses) 8.0 7.3 11.7 16.4 6.1 15.3 8.9
Fee income 147.1 145.8 141.4 135.4 132.3 292.9 254.0
Other revenue 8.1 7.4 14.0 8.3 10.2 15.5 17.6
Total operating revenues 163.2 160.5 167.1 160.1 148.6 323.7 280.5
Operating benefits and expenses
Operating expenses(108.3)(110.7)(114.2)(106.1)(107.5)(219.0)(209.3)
Total operating benefits and expenses(108.3)(110.7)(114.2)(106.1)(107.5)(219.0)(209.3)
Operating earnings before income taxes 54.9 49.8 52.9 54.0 41.1 104.7 71.2
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Voya Financial
Investment Management Key Metrics
Page 33 of 70
Balances as of Balances as of
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Client Assets by Source:
External clients
Investment Management sourced 70,518.2 69,104.4 66,362.2 63,275.4 60,643.9 70,518.2 60,643.9
Affiliate sourced 58,728.9 57,988.9 53,935.0 52,169.5 49,404.6 58,728.9 49,404.6
Subtotal external clients 129,247.1 127,093.3 120,297.2 115,445.0 110,048.5 129,247.1 110,048.5
General Account (1) 78,335.1 79,684.4 78,988.8 80,260.3 80,275.3 78,335.1 80,275.3
Total Client Assets (AUM) 207,582.2 206,777.7 199,286.0 195,705.3 190,323.8 207,582.2 190,323.8
Administration Only Assets (AUA) 55,778.9 53,688.8 58,462.8 55,843.7 55,294.2 55,778.9 55,294.2
Total AUM and AUA 263,361.1 260,466.5 257,748.8 251,549.0 245,618.0 263,361.1 245,618.0
Three Months Ended Year to Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Analysis of investment advisory and administrative
revenues, net, by source: (2)
External clients
Investment Management sourced 77.4 78.5 74.6 69.4 68.2 156.0 126.2
Affiliate sourced 28.9 28.3 26.8 25.8 23.5 57.2 45.6
Subtotal External Clients 106.3 106.8 101.4 95.2 91.7 213.2 171.8
General Account 36.5 36.1 36.2 36.2 36.2 72.5 73.0
Total investment advisory and administrative revenues, net,
from AUM 142.8 142.9 137.6 131.4 127.9 285.7 244.8
Administration Only Fees 4.3 2.9 3.8 4.0 4.4 7.2 9.2
Total investment advisory and administrative revenues, net,
by source (2) 147.1 145.8 141.4 135.4 132.3 292.9 254.0
Revenue Yield (bps): (2) (3)
External clients
Investment Management sourced 44.7 46.7 46.0 44.7 45.6 45.8 43.7
Affiliate sourced 19.9 20.4 20.1 20.5 18.9 20.2 18.6
Revenue Yield on Institutional/retail 33.3 34.8 34.4 33.8 33.5 34.2 32.2
General Account 18.4 18.3 18.0 18.0 18.1 18.3 18.2
Revenue Yield on Client Assets (AUM) 27.6 28.3 27.7 27.3 27.0 28.0 26.2
Revenue Yield on Administration Only Assets (AUA) 3.2 2.1 2.7 2.9 3.1 2.6 3.3
Total Revenue Yield on AUM and AUA (bps) (2) (3) 22.5 22.6 22.1 21.8 21.6 22.6 21.0
| (1) |
|
General Account assets reported on a Statutory Book Value billing basis consistent with revenues earned. |
(2) Measures used by management to evaluate ongoing business performance, allowing for more appropriate comparisons with industry peers. (3) Revenue Yields calculated using average client assets for the period.
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial
Investment Management Account Rollforward by Source
Page 34 of 70
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
AUM Roll-forward By Source
Investment Management Sourced
Beginning AUM 69,104.4 66,362.2 63,275.4 60,643.9 58,002.1 66,362.2 54,061.9
Inflows
Inflows from sub-advisor replacements — — — 197.6
Inflows-other 3,106.7 4,189.3 4,589.9 3,875.4 5,760.6 7,296.0 10,358.6
Outflows(3,701.5)(2,844.0)(3,302.9)(3,160.6)(2,615.4)(6,545.5)(4,780.3)
Net Flows(594.8) 1,345.3 1,287.0 714.9 3,145.2 750.5 5,775.9
Net Money Market Flows(34.1) 28.1 2.3 5.1(21.5)(6.0)(24.7)
Change in Market Value 1,614.4 843.6 1,827.6 1,801.8(513.0) 2,458.0 1,215.2
Other (Including Acquisitions / Divestitures) 428.3 525.2(30.0) 109.8 31.1 953.5(384.4)
Investment Management sourced AUM End of Period 70,518.2 69,104.4 66,362.2 63,275.4 60,643.9 70,518.2 60,643.9
Organic Growth (Long Term Net Flows / Beginning of Period AUM) -0.86% 2.03% 2.03% 1.18% 5.42% 1.13% 10.68%
Market Growth % 2.34% 1.27% 2.89% 2.97% -0.88% 3.70% 2.25%
Affiliate Sourced
Beginning AUM 57,988.9 53,935.0 52,169.5 49,404.6 49,658.0 53,935.0 47,284.6
Inflows
Inflows from sub-advisor replacements—4,671.9—869.8 537.0 4,671.9 984.1
Inflows-other 757.3 949.2 1,149.3 1,849.6 1,024.1 1,706.5 2,603.7
Outflows(2,020.2)(2,082.2)(1,790.4)(1,600.8)(1,606.7)(4,102.4)(3,086.6)
Net Flows(1,262.9) 3,538.9(641.1) 1,118.6(45.6) 2,276.0 501.2
Net Money Market Flows(95.8)(45.5)(156.8)(21.1) 39.8(141.3)(186.4)
Change in Market Value 1,915.8 639.8 2,491.3 2,088.5 10.4 2,555.6 2,121.6
Other (Including Acquisitions / Divestitures) 182.9(79.3) 72.1(421.0)(258.0) 103.6(316.5)
Affiliate sourced AUM End of Period 58,728.9 57,988.9 53,935.0 52,169.5 49,404.6 58,728.9 49,404.6
Organic Growth (Long Term Net Flows / Beginning of Period AUM) -2.18% 6.56% -1.23% 2.26% -0.09% 4.22% 1.06%
Market Growth % 3.30% 1.19% 4.78% 4.23% 0.02% 4.74% 4.49%
Other affiliate sourced net flows(401.4) 4,340.2 10.0 1,722.3 572.2 3,938.8 1,612.6
Variable annuity net flows(861.5)(801.3)(651.1)(603.8)(617.8)(1,662.8)(1,111.4)
Total affiliate sourced net flows(1,262.9) 3,538.9(641.1) 1,118.6(45.6) 2,276.0 501.2
Investment Management sourced net flows(594.8) 1,345.3 1,287.0 714.9 3,145.2 750.5 5,775.9
Total net flows(1,857.7) 4,884.2 645.9 1,833.5 3,099.6 3,026.5 6,277.1
Net Flows excluding sub-advisor replacements and variable annuity net
flows(996.2) 1,013.6 1,297.0 1,567.5 3,180.4 17.4 6,206.8
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Investment Management Account Value by Asset Type
Page 35 of 70
Balances as of
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
(in millions USD)
Institutional
Equity 18,465.7 18,934.5 18,334.8 16,934.3 15,645.2
Fixed Income 39,259.3 38,014.5 36,532.3 35,223.5 34,034.0
Real Estate — — -
Money Market 11.5 28.1 28.6 27.2 18.9
Total 57,736.5 56,977.1 54,895.7 52,185.0 49,698.1
Retail
Equity 43,723.5 42,320.6 41,408.5 38,963.8 36,162.9
Fixed Income 18,505.3 18,798.5 15,209.9 15,191.3 15,208.2
Real Estate 7,250.2 6,873.5 6,647.6 6,801.5 6,660.2
Money Market 2,031.6 2,123.6 2,135.5 2,303.4 2,319.1
Total 71,510.6 70,116.2 65,401.5 63,260.0 60,350.4
General Account
Equity 254.7 265.4 280.3 292.6 356.5
Fixed Income 77,204.4 78,457.1 77,958.6 78,097.5 78,137.2
Real Estate — — -
Money Market 876.0 961.9 749.9 1,870.2 1,781.6
Total 78,335.1 79,684.4 78,988.8 80,260.3 80,275.3
Combined Asset Type
Equity 62,443.9 61,520.5 60,023.6 56,190.9 52,164.6
Fixed Income 134,969.0 135,270.1 129,700.8 128,512.2 127,379.4
Real Estate 7,250.2 6,873.5 6,647.6 6,801.5 6,660.2
Money Market 2,919.1 3,113.6 2,914.0 4,200.7 4,119.6
Total 207,582.2 206,777.7 199,286.0 195,705.3 190,323.8
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Individual Life
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Individual Life Sources of Operating Earnings
Page 37 of 70
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Sources of operating earnings before income taxes:
Investment spread and other investment income (1) 52.1 53.9 57.1 95.1 48.2 106.0 100.6
Fee based margin 4.4 5.5 5.8 4.6 5.0 9.9 9.8
Net underwriting gain (loss) and other revenue 123.9 86.7 100.4 119.9 115.8 210.6 231.7
Administrative expenses(64.4)(68.3)(65.9)(64.0)(69.8)(132.7)(136.8)
Trail commissions(6.0)(6.2)(4.9)(4.8)(5.9)(12.2)(13.6)
DAC/VOBA and other intangibles amortization, excluding
unlocking (1)(45.1)(33.4)(39.1)(70.2)(48.4)(78.5)(93.3)
DAC/VOBA and other intangibles unlocking (1)(1.5)(7.1)(6.4) 36.4(4.9)(8.6)(7.6)
Operating earnings before income taxes 63.4 31.1 47.0 117.0 40.0 94.5 90.8
Gross Investment Income
Fixed income 209.1 210.7 209.5 208.6 204.2 419.8 407.4
Limited partnership income 2.6 4.2 3.6 0.7 3.9 6.8 5.4
Prepayment fee income 3.0 0.5 3.6 3.6 3.1 3.5 10.8
Total gross investment income 214.7 215.4 216.7 212.9 211.2 430.1 423.6
Investment expenses(6.0)(6.1)(6.2)(5.8)(5.7)(12.1)(11.2)
Credited interest(163.9)(162.1)(165.1)(162.5)(163.8)(326.0)(326.1)
Net margin 44.8 47.2 45.4 44.6 41.7 92.0 86.3
Other investment income (1) (2) 7.3 6.7 11.7 50.6 6.5 14.0 14.3
Investment spread and other investment income 52.1 53.9 57.1 95.1 48.2 106.0 100.6
Net underwriting gain (loss) and other revenue
Fee Revenue/Premiums 504.3 488.5 494.2 499.3 500.1 992.8 988.8
Net Mortality, including Reinsurance(299.4)(326.4)(305.8)(283.9)(293.4)(625.8)(595.7)
Reserve Change/Other(81.0)(75.4)(88.0)(95.5)(90.9)(156.4)(161.4)
Total net underwriting gain (loss) and other revenue 123.9 86.7 100.4 119.9 115.8 210.6 231.7
(1) The three months ended 9/30/13 and 12/31/13 include $43.4 million and $3.8 million of net investment income, $(23.0) million and $(2.1) million of DAC/VOBA and other intangibles amortization, and $16.2 million and $1.4 million of DAC/VOBA and other intangibles unlocking from Lehman Recovery/LIHTC, respectively.
(2) Includes investment income on assets backing surplus that has been allocated from the corporate segment and income from policy loans
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Individual Life Operating Earnings
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Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Operating revenues
Net investment income and net realized gains (losses) 215.5 219.8 224.5 258.7 215.4 435.3 432.3
Fee income 285.5 283.6 278.5 278.4 280.0 569.1 556.8
Premiums 191.7 183.7 185.3 174.7 192.1 375.4 377.9
Other revenue 7.2 5.1 4.6 5.3 7.3 12.3 14.9
Total operating revenues 699.9 692.2 692.9 717.1 694.8 1,392.1 1,381.9
Operating benefits and expenses
Interest credited and other benefits to contract owners/policyholders(499.3)(527.8)(518.8)(468.7)(512.4)(1,027.1)(1,014.0)
Operating expenses(91.3)(95.7)(88.9)(83.9)(94.6)(187.0)(185.5)
Net amortization of DAC/VOBA(45.9)(37.6)(38.2)(47.5)(47.6)(83.5)(90.5)
Interest expense — —(0.2) —(1.1)
Total operating benefits and expenses(636.5)(661.1)(645.9)(600.1)(654.8)(1,297.6)(1,291.1)
Operating earnings before income taxes 63.4 31.1 47.0 117.0 40.0 94.5 90.8
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Individual Life Key Metrics
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Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Sales by Product Line
Guaranteed ——0.1 — 0.5
Accumulation 2.1 2.8 2.0 2.8 3.9 4.9 7.9
Indexed 13.3 7.9 8.4 5.8 6.6 21.2 13.4
Total Universal life 15.4 10.7 10.4 8.7 10.5 26.1 21.8
Variable life 1.5 0.9 0.7 2.8 2.4 2.4 5.1
Term 8.1 7.2 9.8 11.2 13.9 15.3 29.1
Whole life—0.1 0.1 0.1—0.1 -
Total sales by product line 25.0 18.9 21.0 22.8 26.8 43.9 56.0
Sales by Distribution
Independent life sales 17.2 13.2 12.9 13.3 17.2 30.4 36.2
Strategic distribution 5.2 3.7 5.2 5.8 5.3 8.9 10.8
Alternative and specialty markets 2.6 2.0 2.9 3.7 4.3 4.6 9.0
Total sales by distribution 25.0 18.9 21.0 22.8 26.8 43.9 56.0
Gross premiums and deposits by product:
Interest sensitive 291.5 276.0 276.1 271.5 273.2 567.5 548.4
Non—interest sensitive 232.7 223.6 227.0 217.2 233.6 456.3 457.0
Total gross premiums and deposits 524.2 499.6 503.0 488.7 506.8 1,023.8 1,005.4
Applications
New business policy count (Paid) 8,837 7,879 9,906 11,904 15,290 16,716 31,427
End of Period:
In-force face amount (by product)
Universal life 77,948 78,162 78,581 78,901 79,505 77,948 79,505
Variable life 27,250 27,667 28,198 28,679 29,153 27,250 29,153
Term 493,570 494,756 495,995 496,935 497,596 493,570 497,596
Whole life 2,145 2,176 2,217 2,241 2,274 2,145 2,274
Total In-force Face 600,914 602,761 604,990 606,756 608,528 600,914 608,528
In-force policy count (in whole numbers)
Universal life 286,236 289,045 292,096 295,241 298,406 286,236 298,406
Variable life 64,569 65,635 66,811 67,887 69,135 64,569 69,135
Term 826,465 828,414 830,832 832,506 832,402 826,465 832,402
Whole life 138,054 140,209 142,409 144,274 146,425 138,054 146,425
Total Policy Counts 1,315,324 1,323,303 1,332,148 1,339,908 1,346,368 1,315,324 1,346,368
Assets under management
General account 13,381.3 13,308.0 13,271.3 13,257.4 13,190.7 13,381.3 13,190.7
Separate account 2,761.6 2,699.7 2,724.3 2,590.3 2,487.0 2,761.6 2,487.0
Total 16,142.9 16,007.7 15,995.6 15,847.7 15,677.7 16,142.9 15,677.7
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Employee Benefits
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Employee Benefits Sources of Operating Earnings
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Sources of operating earnings before income taxes:
Investment spread and other investment income (1) 11.4 10.9 13.6 16.3 11.7 22.3 23.7
Net underwriting gain (loss) and other revenue 91.5 83.1 78.3 76.3 86.9 174.6 149.7
Administrative expenses(42.0)(44.7)(38.5)(39.9)(41.0)(86.7)(80.6)
Trail commissions(18.9)(23.4)(18.0)(18.7)(19.6)(42.3)(39.3)
DAC/VOBA and other intangibles amortization, excluding
unlocking(2.4)(4.4)(4.4)(4.9)(3.9)(6.8)(7.0)
DAC/VOBA and other intangibles unlocking(1.8)(4.6)(0.5) —(6.4) — —
Operating earnings before income taxes 37.8 16.9 30.5 29.1 34.1 54.7 46.5
Gross Investment Income
Fixed income 25.3 24.7 25.4 25.3 24.7 50.0 50.8
Limited partnership income 0.3 0.4 0.6—0.4 0.7 0.6
Prepayment fee income 0.4 0.1 1.0 1.1 1.3 0.5 1.8
Total gross investment income 26.0 25.2 27.0 26.4 26.4 51.2 53.2
Investment expenses(0.7)(0.8)(0.6)(0.8)(0.8)(1.5)(1.7)
Credited interest(16.4)(15.8)(15.7)(15.8)(16.1)(32.2)(32.5)
Net margin 8.9 8.6 10.7 9.8 9.5 17.5 19.0
Other investment income (1) (2) 2.5 2.3 2.9 6.5 2.2 4.8 4.7
Investment spread and other investment income 11.4 10.9 13.6 16.3 11.7 22.3 23.7
Group life
Premiums 115.7 113.3 117.2 118.1 119.3 229.0 238.1
Benefits(86.4)(92.9)(84.3)(97.0)(89.9)(179.3)(191.4)
Other (3)(1.8)(2.1)(2.5)(1.1)(2.6)(3.9)(5.7)
Total 27.5 18.3 30.5 20.0 26.8 45.8 41.0
Loss Ratio (Interest adjusted) 74.7% 82.0% 72.0% 82.1% 75.4% 78.3% 80.4%
Group stop loss
Premiums 164.0 163.9 138.8 136.3 133.9 327.9 269.7
Benefits(118.5)(118.6)(108.9)(99.3)(96.6)(237.1)(202.0)
Other (3)(0.9)(1.4)(0.4)(1.1)(0.3)(2.3)(1.6)
Total 44.6 43.9 29.5 35.9 37.0 88.5 66.1
Loss Ratio 72.2% 72.4% 78.4% 72.8% 72.1% 72.3% 74.9%
Voluntary Benefits, Disability, and Other 19.5 21.0 18.3 20.5 23.1 40.5 42.5
Net underwriting gain (loss) and other revenue 91.5 83.1 78.3 76.3 86.9 174.6 149.7
(1) The three months ended 9/30/13 and 12/31/13 include $4.0 million and $0.3 million of net investment income from Lehman Recovery/LIHTC, respectively.
(2) Includes investment income on assets backing surplus that has been allocated from the corporate segment. (3) Other includes service fees, dividends, interest expenses, and other miscellaneous expenses. The Loss Ratio calculation does not include Other.
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Employee Benefits Operating Earnings
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Operating revenues
Net investment income and net realized gains (losses) 27.7 26.7 29.2 32.1 27.9 54.4 56.3
Fee income 14.7 15.6 15.9 15.5 15.8 30.3 31.6
Premiums 302.8 296.3 272.4 269.6 269.0 599.1 543.9
Other revenue(2.7) 0.3(1.0)(1.0)(1.0)(2.4)(2.0)
Total operating revenues 342.5 338.9 316.5 316.2 311.7 681.4 629.8
Operating benefits and expenses
Interest credited and other benefits to contract owners/policyholders(239.6)(244.5)(223.9)(223.7)(213.2)(484.1)(455.8)
Operating expenses(60.9)(68.4)(57.1)(58.5)(60.5)(129.3)(120.5)
Net amortization of DAC/VOBA(4.2)(9.1)(5.0)(4.9)(3.9)(13.3)(7.0)
Total operating benefits and expenses(304.7)(322.0)(286.0)(287.1)(277.6)(626.7)(583.3)
Operating earnings before income taxes 37.8 16.9 30.5 29.1 34.1 54.7 46.5
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Employee Benefits Key Metrics
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Sales
Group life (Basic / Sup / AD&D) 4.1 37.5 5.4 7.3 1.6 41.6 45.6
Group stop loss 9.4 182.4 14.0 38.1 11.6 191.8 101.3
Disability 0.7 8.6 3.1 2.5 1.1 9.3 12.0
Association (Life, DI, PAI) 0.7—3.6 0.1 0.3 0.7 0.3
Other (PAI)—1.0 0.4 0.2 0.1 1.0 1.9
Total group products 14.9 229.5 26.5 48.2 14.7 244.4 161.1
Voluntary products 4.3 22.3 9.1 4.0 3.8 26.6 14.1
Total sales by product line 19.2 251.8 35.6 52.2 18.5 271.0 175.2
Total gross premiums and deposits 348.3 342.9 314.5 316.2 311.3 691.2 630.8
Total annualized in-force premiums 1,396.7 1,407.7 1,294.6 1,292.4 1,273.5 1,396.7 1,273.5
Assets under management (EOP)
General account 1,791.3 1,760.5 1,739.2 1,753.6 1,747.3 1,791.3 1,747.3
Separate account 16.2 15.9 15.9 15.2 14.8 16.2 14.8
Total 1,807.5 1,776.4 1,755.1 1,768.8 1,762.1 1,807.5 1,762.1
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Corporate
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Corporate Operating Earnings
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Interest expense(46.7)(47.0)(47.0)(47.6)(43.2)(93.7)(85.1)
Closed Block Variable Annuity contingent capital LOC — — — — —(5.6) -(18.4)
Amortization of intangibles(8.6)(8.6)(8.7)(8.7)(8.8)(17.2)(17.6)
Other (1) 17.0 18.3 11.7(7.4) 4.8 35.3 18.2
Operating earnings before income taxes(38.3)(37.3)(44.0)(63.7)(52.8)(75.6)(102.9)
| (1) |
|
The three months ended 12/31/13, 3/31/14, and 6/30/14 include $3.2 million, $(1.8) |
million, and $5.8 million of net investment income from Lehman Recovery, respectively.
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Closed Blocks (Variable Annuity and Other)
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Closed Block ISP and Other Operating Earnings
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Closed Block Institutional Spread Products (1) 6.6 5.4(5.8) 8.7 10.9 12.0 33.0
Closed Block Other (2) 3.9(4.5) 2.5 5.8 7.1(0.6) 6.4
Operating earnings before income taxes 10.5 0.9(3.3) 14.5 18.0 11.4 39.4
Three Months Ended Year-to-Date
Closed Block Institutional Spread Products 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Operating revenues
Net investment income and net realized gains (losses) (1) 16.6 17.2 21.1 22.8 26.0 33.8 64.0
Premiums 0.6 0.6 0.6 0.6 0.6 1.2 1.2
Other revenue(0.2)(0.2)(0.3)(0.3)(0.3)(0.4)(0.6)
Total operating revenues 17.0 17.6 21.4 23.1 26.3 34.6 64.6
Operating benefits and expenses
Interest credited and other benefits to contract owners/policyholders(7.5)(8.8)(24.6)(11.9)(12.7)(16.3)(26.2)
Operating expenses(2.8)(3.3)(2.5)(2.4)(2.6)(6.1)(5.2)
Net amortization of DAC/VOBA(0.1)(0.1)(0.1)(0.1)(0.1)(0.2)(0.2)
Total operating benefits and expenses(10.4)(12.2)(27.2)(14.4)(15.4)(22.6)(31.6)
Operating earnings before income taxes 6.6 5.4(5.8) 8.7 10.9 12.0 33.0
Three Months Ended Year-to-Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Closed Block Other
Operating revenues
Net investment income and net realized gains (losses) (2) 6.2 5.9 5.5 7.1 6.0 12.1 12.0
Premiums 0.9 1.9(0.1) 0.4 1.1 2.8 2.0
Other revenue(0.1) 0.2 0.2 0.1 0.2 0.1 0.5
Total operating revenues 7.0 8.0 5.6 7.6 7.3 15.0 14.5
Operating benefits and expenses
Interest credited and other benefits to contract owners/policyholders(1.4)(6.7)(0.6) 0.8 7.3(8.1) 0.5
Operating expenses(1.7)(5.8)(2.5)(2.6)(7.5)(7.5)(8.6)
Total operating benefits and expenses(3.1)(12.5)(3.1)(1.8)(0.2)(15.6)(8.1)
Operating earnings before income taxes 3.9(4.5) 2.5 5.8 7.1(0.6) 6.4
(1) The three months ended 9/30/13 and 12/31/13 include $(0.2) million and $(0.2) million of net investment income from Lehman Recovery/LIHTC, respectively.
(2) The three months ended 9/30/13 and 12/31/13 include $0.8 million and $(0.2) million of net investment income from Lehman Recovery/LIHTC, respectively.
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Closed Block Variable Annuity Income (Loss) before income taxes
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Revenues
Net investment income 38.9 34.8 29.5 28.8 20.9 73.7 39.3
Fee income 315.8 316.8 331.8 325.3 320.7 632.6 630.0
Premiums 93.0 50.2 40.4 38.8—143.2 —
Net realized gains (losses)(339.4)(121.1)(560.8)(463.0)(408.4)(460.5)(1,184.8)
Other revenues and premiums 3.8 3.9 3.2 4.0 6.5 7.7 11.2
Total revenues 112.1 284.6(155.9)(66.1)(60.3) 396.7(504.3)
Benefits and expenses
Interest credited and other benefits to contract owners/policyholders(62.8)(126.5) 64.5 37.6(144.3)(189.3)(50.2)
Operating expenses and interest expense(118.6)(122.1)(119.6)(119.2)(116.5)(240.7)(228.7)
Net amortization of DAC/VOBA(14.8)(15.8)(15.4)(19.7)(17.3)(30.6)(32.3)
Total benefits and expenses(196.2)(264.4)(70.5)(101.3)(278.1)(460.6)(311.2)
Income (loss) before income taxes(84.1) 20.2(226.4)(167.4)(338.4)(63.9)(815.5)
Three Months Ended Year-to-Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
The following table presents notable items that result in volatility in income (loss) before
income taxes:
Net gains (losses) related to incurred guaranteed benefits and guarantee hedge program,
excluding nonperformance risk (1)(256.7)(239.1)(201.9)(366.3)(407.4)(495.8)(861.3)
Gains (losses) related to CHO program (1)(43.2)(10.9) —(40.7)(45.6)(54.1)(204.1)
Gain (loss) due to nonperformance risk(1)(32.2) 29.5(271.7) 5.2(121.3)(2.7)(228.0)
Net investment gains (losses) (1)(0.7)(0.6)(0.7)(3.7) 3.5(1.3) 17.0
DAC/VOBA and other intangibles unlocking and loss recognition 1.6 0.4 1.6(4.3)(1.8) 2.0(2.0)
| (1) |
|
Amounts exclude net amortization of DAC/VOBA and other intangibles. |
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Closed Block Variable Annuity Death and Living Benefits
Balances as of
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
Death and living benefits-account value
GMAB/GMWB 873 893 943 957 970
GMIB 15,641 15,594 15,909 15,443 15,048
GMWBL 16,548 16,373 16,537 16,053 15,636
No living benefits 11,106 11,117 11,351 11,107 10,934
Total (1) 44,168 43,977 44,740 43,560 42,588
Net amount at risk (after reinsurance)
Total DB NAR 4,753 5,090 5,074 5,720 6,437
GMAB/GMWB 17 20 20 25 32
GMIB(2) 1,885 1,964 1,682 2,321 2,780
GMWBL(2) 695 656 452 700 960
Total LB NAR 2,597 2,640 2,154 3,046 3,772
| (1) |
|
Excludes assets associated with Payout Reserves, Policy Loans, and Life Insurance Business |
| (2) |
|
GMIB and GMWBL values represent discounted net amount at risk |
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
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Closed Block Variable Annuity AUM Rollforward
Three Months Ended Year-to-Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
(in millions USD)
Products in accumulation phase:
Balance as of beginning of period 44,022.8 44,788.2 43,608.4 42,635.2 43,897.8 44,788.2 42,590.6
Deposits 47.4 53.6 55.1 61.0 79.6 101.0 154.5
Surrenders, benefits, and product charges(1,309.6)(1,234.4)(1,172.5)(1,097.2)(1,175.2)(2,544.0)(2,233.0)
Net cash flow(1,262.2)(1,180.9)(1,117.4)(1,036.2)(1,095.6)(2,443.1)(2,078.6)
Interest credited and investment performance 1,462.8 415.4 2,297.2 2,009.3(167.1) 1,878.2 2,123.1
Balance as of end of period 44,223.4 44,022.8 44,788.2 43,608.4 42,635.1 44,223.4 42,635.1
End of period contracts in payout status 1,167.0 1,019.2 910.8 818.5 724.2 1,167.0 724.2
Total balance as of end of period* 45,390.4 45,042.0 45,699.0 44,426.9 43,359.3 45,390.4 43,359.3
Assets Under Management
General account 1,651.4 1,517.3 1,429.1 1,379.7 1,336.6 1,651.4 1,336.6
Separate account 43,739.0 43,524.7 44,269.9 43,047.2 42,022.7 43,739.0 42,022.7
Total* 45,390.4 45,042.0 45,699.0 44,426.9 43,359.3 45,390.4 43,359.3
*Includes products in accumulation and payout phase, Policy Loans, and Life Insurance Business Retirement Investments Insurance
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VOYA FINANCIAL TM
Investment Information
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VOYA FINANCIAL TM
Voya Financial Page 52 of 70
Portfolio Composition
Balances as of
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
(in millions USD) Amount% of Total Amount% of Total Amount% of Total Amount% of Total Amount% of Total
Composition of Investment Portfolio
Fixed maturities, available for sale, at fair value, before consolidation 70,948.8 70,474.0 68,341.9 69,258.8 69,930.1
CLOs Adjustments (1)(56.9)(43.8)(43.0)(118.0)(119.6)
VOEs Adjustments (1) 32.4 19.5 18.9 30.6 32.9
Fixed maturities, available for sale, at fair value, after consolidation 70,924.3 78.9% 70,449.7 79.3% 68,317.8 78.4% 69,171.4 77.7% 69,843.4 78.0%
Fixed maturities, at fair value using the fair value option 3,538.7 3.9% 3,082.1 3.5% 2,935.3 3.4% 2,910.2 3.3% 2,771.6 3.1%
Equity securities, available for sale, at fair value 273.5 0.3% 276.6 0.3% 314.4 0.4% 279.6 0.3% 281.0 0.3%
Short-term investments 775.9 0.9% 1,046.2 1.2% 1,048.1 1.2% 2,547.3 2.8% 2,404.8 2.7%
Mortgage loans on real estate 9,491.4 10.6% 9,258.1 10.4% 9,312.2 10.7% 9,015.6 10.1% 8,929.1 10.0%
Policy loans 2,113.7 2.4% 2,119.7 2.4% 2,147.0 2.5% 2,147.5 2.4% 2,144.9 2.4%
Limited partnerships/corporations, before consolidation 1,036.9 875.0 890.4 984.3 1,024.0
VOEs Adjustments (1)(693.0)(656.1)(654.0)(594.3)(593.8)
Limited partnerships/corporations, after consolidation 343.9 0.4% 218.9 0.2% 236.4 0.3% 390.0 0.4% 430.2 0.5%
Derivatives 1,094.6 1.2% 1,044.7 1.2% 1,149.3 1.3% 1,087.4 1.3% 1,174.4 1.3%
Other investments 120.2 0.1% 124.1 0.1% 124.6 0.1% 145.7 0.2% 168.4 0.2%
Securities pledged to creditors 1,145.1 1.3% 1,271.3 1.4% 1,465.7 1.7% 1,312.6 1.5% 1,357.0 1.5%
Total investments, after consolidation 89,821.3 100.0% 88,891.4 100.0% 87,050.8 100.0% 89,007.3 100.0% 89,504.8 100.0%
Fixed Maturity Securities—Security Sector (2)
U.S. Government agencies and authorities 5,231.4 6.9% 5,907.2 8.0% 5,800.1 8.0% 6,336.4 8.6% 6,660.8 9.0%
U.S. Corporate—Public 34,203.7 45.2% 33,257.9 44.5% 32,033.7 44.0% 32,048.9 43.8% 31,643.8 42.8%
U.S. Corporate—Private 6,025.6 8.0% 5,915.6 7.9% 5,444.9 7.5% 5,362.3 7.3% 5,423.1 7.3%
Foreign Government / Agency 927.9 1.2% 907.2 1.2% 1,051.4 1.4% 1,057.5 1.4% 1,091.8 1.5%
Foreign Corporate—Public 7,649.0 10.1% 7,383.6 9.9% 7,044.1 9.7% 6,982.4 9.5% 6,572.7 8.9%
Foreign Corporate—Private 8,440.0 11.2% 8,449.8 11.4% 8,261.0 11.4% 8,149.1 11.1% 8,083.4 10.9%
State, municipalities and political subdivisions 367.0 0.5% 293.6 0.4% 281.1 0.4% 285.0 0.4% 292.5 0.4%
Residential mortgaged-backed securities: 0.0%
CMO-B Agency 3,017.5 3.9% 3,051.7 4.0% 2,945.5 4.0% 2,882.5 3.9% 2,706.0 3.7%
CMO-B Non-Agency 419.2 0.6% 424.2 0.6% 430.3 0.6% 449.0 0.6% 479.7 0.6%
Agency 2,544.7 3.4% 2,735.0 3.6% 2,881.9 4.0% 3,030.0 4.1% 3,336.1 4.5%
Non-Agency (3) 1,465.3 1.9% 1,447.4 1.9% 1,478.9 2.0% 1,587.8 2.2% 1,847.0 2.5%
Total Residential mortgage-backed securities 7,446.7 9.8% 7,658.3 10.1% 7,736.6 10.6% 7,949.3 10.8% 8,368.8 11.3%
Commercial mortgage-backed securities 3,911.1 5.2% 3,796.1 5.0% 3,752.1 5.2% 3,867.6 5.3% 4,425.9 6.0%
Other asset-backed securities (3) 1,405.7 1.9% 1,233.8 1.6% 1,313.8 1.8% 1,355.7 1.8% 1,409.2 1.9%
Total fixed maturities, including securities pledged (5) 75,608.1 100.0% 74,803.1 100.0% 72,718.8 100.0% 73,394.2 100.0% 73,972.0 100.0%
Fixed Maturity Securities—Contractual Maturity Dates
Due to mature:
Due in one year or less 2,244.1 3.0% 2,032.5 2.7% 2,153.6 3.0% 2,423.9 3.3% 2,471.6 3.3%
Due after one year through five years 14,196.3 18.8% 14,748.5 19.8% 14,397.4 19.8% 16,036.2 21.8% 15,862.9 21.4%
Due after five years through ten years 21,912.8 29.0% 22,070.1 29.6% 21,303.4 29.3% 20,113.5 27.4% 19,928.2 26.9%
Due after ten years 24,491.4 32.3% 23,263.8 31.2% 22,061.9 30.3% 21,648.0 29.6% 21,505.4 29.2%
CMO-B 3,436.7 4.5% 3,475.9 4.6% 3,375.8 4.6% 3,331.5 4.5% 3,185.7 4.3%
Mortgage-backed securities 7,921.1 10.5% 7,978.5 10.5% 8,112.9 11.2% 8,485.4 11.6% 9,609.0 13.0%
Other asset-backed securities (3) 1,405.7 1.9% 1,233.8 1.6% 1,313.8 1.8% 1,355.7 1.8% 1,409.2 1.9%
Total fixed maturities, including securities pledged 75,608.1 100.0% 74,803.1 100.0% 72,718.8 100.0% 73,394.2 100.0% 73,972.0 100.0%
Fixed Maturity Securities—NAIC Quality Designation
NAIC Quality Designation
| 1 |
|
42,638.8 56.3% 42,124.9 56.3% 41,169.4 56.5% 41,616.0 56.7% 42,428.3 57.4% |
| 2 |
|
29,511.1 39.0% 29,249.6 39.1% 28,555.4 39.3% 28,315.4 38.6% 27,962.2 37.8% |
| 3 |
|
2,839.0 3.8% 2,772.8 3.7% 2,415.8 3.3% 2,735.2 3.7% 2,661.7 3.6% |
| 4 |
|
360.5 0.5% 407.9 0.5% 329.5 0.5% 456.9 0.6% 551.3 0.7% |
| 5 |
|
63.4 0.1% 59.3 0.1% 61.7 0.1% 78.2 0.1% 160.5 0.2% |
| 6 |
|
195.3 0.3% 188.6 0.3% 187.0 0.3% 192.5 0.3% 208.0 0.3% |
Total fixed maturities, including securities pledged (4) (5) 75,608.1 100.0% 74,803.1 100.0% 72,718.8 100.0% 73,394.2 100.0% 73,972.0 100.0%
Fixed Maturity Securities—ARO Quality Rating
ARO Quality Rating
AAA 14,832.8 19.6% 15,506.9 20.7% 15,330.7 21.1% 15,856.2 21.6% 16,486.5 22.3%
AA 4,701.0 6.2% 4,464.3 6.0% 4,342.1 6.0% 4,518.3 6.2% 4,349.5 5.9%
A 21,403.1 28.3% 20,474.7 27.4% 19,793.6 27.2% 19,877.9 27.1% 19,702.3 26.6%
BBB 29,681.4 39.3% 29,449.9 39.4% 28,561.5 39.2% 28,383.4 38.6% 28,310.1 38.3%
BB 2,960.9 3.9% 2,858.8 3.8% 2,676.1 3.7% 2,682.6 3.7% 2,843.4 3.8%
B and below 2,028.9 2.7% 2,048.5 2.7% 2,014.8 2.8% 2,075.8 2.8% 2,280.2 3.1%
Total fixed maturities, including securities pledged (5) 75,608.1 100.0% 74,803.1 100.0% 72,718.8 100.0% 73,394.2 100.0% 73,972.0 100.0%
(1) Adjustments include the elimination of intercompany transactions between the Company and its consolidated investment entities, primarily the
elimination of the Company’s equity at risk recorded as investments by the Company (before consolidation) against either equity (private equity and real
estate partnership funds) or senior and subordinated debt (CLOs) of the funds.
(2) Fixed Maturity Securities includes fixed maturities,available for sale , fixed maturities at fair value using the fair value option and securities pledged to creditors.
| (3) |
|
Subprime asset-backed securities are included as a component of Non-Agency RMBS under this presentation. |
| (4) |
|
ARO ratings do not directly translate into NAIC ratings. |
(5) Includes fixed maturities securities related to businesses exited through reinsurance. Refer to page in “Additional Information” section.
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VOYA FINANCIAL TM
Voya Financial Page 53 of 70
Portfolio Results
Three Months Ended Year to Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
(in millions USD)
Net Investment Annualized Net Investment Annualized Net Investment Annualized Net Investment Annualized Net Investment Annualized Net Investment Annualized Net Investment Annualized
Operating investment income and annualized yield Income Yield Income Yield Income Yield Income Yield Income Yield Income Yield Income Yield
Fixed maturity securities (1) 827.5 4.99% 843.8 5.02% 839.4 4.98% 824.1 4.88% 831.0 5.02% 1,671.3 5.00% 1,686.6 5.14%
Equity securities 3.6 5.68% 3.8 5.59% 3.5 4.54% 3.4 4.96% 0.5 0.77% 7.4 5.66% 3.1 2.25%
Mortgage loans 114.8 5.03% 114.4 5.06% 114.2 5.18% 112.8 5.13% 113.6 5.24% 229.2 5.05% 229.0 5.31%
Limited partnerships 36.2 14.98% 31.4 15.46% 61.5 31.85% 116.1 60.40% 27.8 11.46% 67.6 15.20% 51.0 10.40%
Policy loans 27.5 5.34% 28.0 5.42% 29.2 5.58% 29.5 5.66% 29.7 5.69% 55.5 5.38% 59.6 5.63%
Short-term investments 0.7 0.17% 0.8 0.13% 0.8 0.16% 0.8 0.12% 1.0 0.17% 1.5 0.15% 1.9 0.14%
Derivatives (1) 1.7 N/A 1.3 N/A(6.8) N/A(2.2) N/A(9.0) N/A 3.0 N/A(20.9) N/A
Pre-payment fee income 21.4 0.10% 7.5 0.04% 25.9 0.12% 14.6 0.07% 25.7 0.12% 28.9 0.07% 51.3 0.12%
Other assets(2.2) N/A 5.5 N/A 8.3 N/A 23.6 N/A 3.3 N/A 3.3 N/A 6.8 N/A
Gross investment income before expenses and fees 1,031.2 5.12% 1,036.5 5.07% 1,076.0 5.28% 1,122.7 5.47% 1,023.6 5.07% 2,067.7 5.09% 2,068.4 5.14%
Expenses and fees(39.7) -0.20%(40.3) -0.20%(40.7) -0.21%(39.5) -0.19%(40.7) -0.21%(80.0) -0.20%(81.5) -0.21%
Total investment income and annualized yield 991.5 4.92% 996.2 4.87% 1,035.3 5.07% 1,083.2 5.28% 982.9 4.86% 1,987.7 4.89% 1,986.9 4.93%
Less: Closed Block Variable Annuity (CBVA) investment income net of expenses and
fees 38.9 34.8 29.5 28.8 20.9 73.7 39.3
Total investment income, excluding CBVA 952.6 961.4 1,005.8 1,054.4 962.0 1,914.0 1,947.6
Trading Gains/Losses
Fixed maturities(0.4) 16.1 62.7 36.0 0.8 15.7 11.8
Equity securities 0.7 18.1—0.6(0.1) 18.8 0.1
Mortgage loans—0.4 0.1 0.2(0.2) 0.4(0.2)
Other investments 29.5(1.0)(3.2) 4.3(3.0) 28.5(1.4)
Total Trading Gains/Losses, excluding CBVA 29.8 33.6 59.6 41.1(2.5) 63.4 10.3
Impairments
Fixed maturities(2.4)(2.3)(13.1)(2.3)(5.4)(4.7)(16.4)
Equity securities -(1.0) -(1.2)(1.8)(1.0)(1.8)
Mortgage loans — — — -
Other investments — -(0.7) — -
Total Impairments, excluding CBVA(2.4)(3.3)(13.1)(4.2)(7.2)(5.7)(18.2)
Fair Value Adjustments (2) 64.9 59.7 42.6 19.6(77.7) 124.6(87.9)
Derivatives, including Change in Fair Value of Derivatives related to
Guaranteed Benefits, excluding CBVA(49.5)(64.1) 15.5 17.8 114.6(113.6) 172.7
Net Realized Investment Gains (losses) and Net Guaranteed Benefit
Hedging Gains (losses), excluding CBVA 42.8 25.9 104.6 74.3 27.2 68.7 76.9
CBVA Investment Income and Realized Capital Gains (Losses)(300.5)(86.3)(531.3)(434.2)(387.5)(386.8)(1,145.5)
Businesses exited through reinsurance (3) 62.9 16.4(12.3)(15.6)(62.7) 79.3(81.4)
Consolidation/eliminations (4)(3.4) 37.6 12.7 25.6 7.3 34.2 72.6
Total Investment Income and Realized Capital Gains (Losses) 754.4 955.0 579.5 704.5 546.3 1,709.4 870.2
| (1) |
|
Operating income from CMO-B portfolio assets, including derivatives, is included in fixed maturity securities. |
(2) Fair value adjustments include adjustments related to CMO-B assets carried at fair value, among other income sources.
(3) Income related to reinsurance transactions, in which investment results are passed directly to the reinsurers pursuant to contracted terms of the reinsurance agreement.
| (4) |
|
Consolidation/eliminations includes: |
-The impact of consolidation of investment entities into the Consolidated Statements of Operations, net of the elimination of the Company’s management fees expensed by the funds and recorded as operating revenues (before consolidation) by the Company;
-The elimination of intersegment expenses, primarily consisting of asset-based management and administration fees charged by our Investment Management Segment; Retirement Investments Insurance
VOYA FINANCIAL TM
-OTHER INTERSEGMENT ELIMINATIONS.
Voya Financial Page 54 of 70
Alternative Investment Income
(in millions USD) Three Months Ended Year-to-Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Retirement
Average alternative investments 288.5 266.7 264.8 267.1 260.0 277.6 258.0
Alternative investment income 7.0 7.1 12.6 7.5 8.4 14.1 16.3
Annuities
Average alternative investments 190.4 179.3 170.9 171.5 178.8 184.8 184.0
Alternative investment income 5.4 6.4 9.1 4.5 7.6 11.8 12.0
Investment Management
Average alternative investments 146.9 141.7 127.1 124.2 123.8 144.3 122.2
Alternative investment income 8.0 7.3 10.0 4.9 6.1 15.3 8.9
Individual Life
Average alternative investments 135.3 123.9 125.5 127.7 138.8 129.6 135.5
Alternative investment income 4.1 5.5 7.1 3.4 6.3 9.6 9.7
Employee Benefits
Average alternative investments 27.0 24.1 24.5 25.1 25.6 25.6 24.6
Alternative investment income 0.7 0.8 1.4 0.8 1.1 1.5 1.7
Total Ongoing Business
Average alternative investments 788.1 735.7 712.8 715.6 727.0 761.9 724.3
Alternative investment income 25.2 27.1 40.2 21.1 29.5 52.3 48.6
Corporate
Average alternative investments 106.0 103.7 101.6 95.8 95.5 104.9 96.8
Alternative investment income 4.2 5.0 7.2 4.8(5.7) 9.2(3.0)
Closed Blocks (1)
Average alternative investments 35.0 29.8 51.7 58.8 59.4 32.4 60.9
Alternative investment income 1.3 1.1 3.0 2.5 2.4 2.4 4.2
Total Consolidated(2)
Average alternative investments 929.1 869.2 866.1 870.2 881.9 899.2 882.0
Alternative investment income 30.7 33.2 50.4 28.4 26.2 63.9 49.8
| (1) |
|
Our Closed Block Variable Annuity segment is managed to focus on protecting |
regulatory and rating agency capital rather than achieving operating metrics and,
therefore, its results of operations are not reflected within investment income.
| (2) |
|
Alternative investment income excludes the net investment income from Lehman |
Recovery/LIHTC in the 6/30/14, 3/31/14, 12/31/13 and 9/30/13 periods.
RETIREMENT INVESTMENTS INSURANCE
VOYA Financial TM
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Unrealized Gains (Losses)
(in millions USD)
Fixed Maturities, available for sale (including securities pledged)
Aging Schedule
Balances as of
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
Amount% of Total Amount% of Total Amount% of Total Amount% of Total Amount% of Total
Less than 20%(282.1) 97.6%(587.6) 97.3%(1,087.3) 95.7%(992.6) 92.9%(929.8) 92.7%
20% or more for less than six months(0.5) 0.2%(8.5) 1.4%(18.6) 1.6%(47.3) 4.4%(35.3) 3.5%
20% or more for six months or greater(6.4) 2.2%(7.8) 1.3%(30.6) 2.7%(29.1) 2.7%(38.2) 3.8%
Total Unrealized Loss(289.0) 100.0%(603.9) 100.0%(1,136.5) 100.0%(1,069.0) 100.0%(1,003.3) 100.0%
Total Unrealized Gain 6,266.5 5,363.6 4,301.8 4,594.2 4,919.9
Net Unrealized Gain/Loss 5,977.5 4,759.7 3,165.3 3,525.2 3,916.6
Fixed Maturities Securities—Security Sector—Net Unrealized
Gain/(Loss)*
US Treasuries and US government agencies and authorities 450.1 305.0 108.1 255.7 348.7
US Corporate—Public 2,818.5 2,121.0 1,173.7 1,238.2 1,458.9
US Corporate—Private 458.6 393.7 294.6 354.2 363.5
Foreign Government / Agency 44.0 20.9 7.4 11.9 11.0
Foreign Corporate—Public 563.6 393.1 228.2 202.9 207.4
Foreign Corporate—Private 648.6 580.4 459.5 509.1 503.6
State, municipalities, and political subdivisions 22.3 17.1 9.1 11.0 14.2
Residential mortgaged-backed securities:
CMO-B Agency 392.6 385.5 376.5 397.0 422.3
CMO-B Non-Agency 123.6 119.5 118.1 115.5 117.1
Agency 33.6 5.3(7.5) 13.1 7.9
Non-Agency 74.6 62.4 36.7 13.1 0.3
Total Residential mortgage-backed securities 624.4 572.7 523.8 538.7 547.6
Commercial Mortgage-Backed Securities 314.9 323.3 324.2 358.3 411.3
Other Asset-Backed Securities* 32.5 32.5 36.7 45.2 50.4
Total Net Unrealized Gain/Loss 5,977.5 4,759.7 3,165.3 3,525.2 3,916.6
| * |
|
Subprime asset-backed securities are included as a component of Non-Agency RMBS under this presentation. |
RETIREMENT INVESTMENTS INSURANCE
VOYA FINANCIAL TM
Voya Financial Page 56 of 70
Asset Backed Securities
(in millions USD)
RMBS Balances by Collateral Type
Balances as of
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
Amortized Amortized Amortized Amortized Amortized
Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost
Prime Agency 5,554.0 5,054.8 5,777.9 5,310.9 5,826.0 5,377.7 5,911.2 5,410.4 6,040.8 5,508.4
Prime / Non-Agency 959.6 806.0 904.0 750.2 933.7 786.5 1,021.6 872.1 1,148.9 1,000.6
Alt-A RMBS 337.7 279.6 353.3 297.7 353.5 307.4 358.8 326.0 376.3 344.6
Subprime Mortgage-Backed Securities 595.4 562.6 623.1 603.7 623.4 614.7 657.7 657.5 802.8 806.5
Total 7,446.7 6,703.0 7,658.3 6,962.5 7,736.6 7,086.3 7,949.3 7,266.0 8,368.8 7,660.1
CMBS Balances by Year of Origination
Balances as of
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
Amortized Amortized Amortized Amortized Amortized
Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost
2014 181.4 176.8 52.5 52.6 — — —
2013 390.6 375.1 341.6 337.7 197.2 200.4 — —
2012 11.1 10.7 9.0 8.9 8.8 8.9 — —
2010 8.3 8.3 7.9 8.0 — — —
2008 11.4 9.5 11.4 9.3 11.4 9.3 11.5 9.3 11.4 9.2
2007 1,150.0 1,016.6 1,148.2 1,014.2 1,148.1 1,017.8 1,264.7 1,123.6 1,636.3 1,457.6
2006 1,216.1 1,107.3 1,238.9 1,116.9 1,252.7 1,127.4 1,338.8 1,201.6 1,390.0 1,247.1
2005 and prior 942.2 891.9 986.6 925.2 1,133.9 1,064.1 1,252.6 1,174.8 1,388.2 1,300.7
Total 3,911.1 3,596.2 3,796.1 3,472.8 3,752.1 3,427.9 3,867.6 3,509.3 4,425.9 4,014.6
Other ABS Balances by Loan
Classification
Balances as of
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
Amortized Amortized Amortized Amortized Amortized
Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost
Credit Card Receivables 638.4 619.0 576.4 558.0 558.1 538.5 552.8 529.4 564.1 538.5
Automobile Receivables 424.5 423.5 384.4 383.6 447.9 447.1 471.3 470.2 500.1 498.9
CLO’s * 83.1 79.7 26.2 22.9 41.7 36.6 49.5 48.9 49.1 48.4
Other 259.7 251.0 246.8 236.8 266.1 254.9 282.1 268.8 295.9 280.3
Total 1,405.7 1,373.2 1,233.8 1,201.3 1,313.8 1,277.1 1,355.7 1,317.3 1,409.2 1,366.1
| * |
|
Excludes consolidated CLO’s |
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Voya Financial Page 57 of 70
RMBS Securities Summary
(in millions USD)
RMBS(1)
By Rating and Origination Year
As of June 30, 2014
Prime Agency Prime/Non-Agency Alt-A RMBS Subprime Mortgage-Backed Total
Securities
NAIC Designation Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost
| 1 |
|
5,539.9 5,038.8 668.6 597.9 268.8 221.7 445.0 398.8 6,922.3 6,257.2 |
| 2 |
|
— 55.8 54.4 26.3 25.1 95.3 104.9 177.4 184.4 |
| 3 |
|
8.3 10.2 31.3 29.1 21.9 19.8 31.6 34.6 93.1 93.7 |
| 4 |
|
5.8 5.8 3.3 0.8 17.1 10.2 15.6 17.8 41.8 34.6 |
| 5 |
|
— 47.9 33.9 1.0 0.6 5.9 3.7 54.8 38.2 |
| 6 |
|
— 152.7 89.9 2.6 2.2 2.0 2.8 157.3 94.9 |
Total by rating (2) 5,554.0 5,054.8 959.6 806.0 337.7 279.6 595.4 562.6 7,446.7 6,703.0
Prime Agency Prime/Non-Agency Alt-A RMBS Subprime Mortgage-Backed Total
Securities
ARO Rating Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost
AAA 5,521.8 5,019.8 9.8 9.7 0.2 0.2 2.6 2.5 5,534.4 5,032.2
AA 2.9 2.8 26.9 24.8 — 2.4 2.4 32.2 30.0
A 4.5 4.5 37.3 34.7 3.9 3.5 35.0 35.6 80.7 78.3
BBB — 112.6 107.6 13.4 13.8 31.0 31.9 157.0 153.3
BB 8.3 10.2 62.5 57.4 18.0 17.7 47.4 51.8 136.2 137.1
B and below 16.5 17.5 710.5 571.8 302.2 244.4 477.0 438.4 1,506.2 1,272.1
Total by rating (2) 5,554.0 5,054.8 959.6 806.0 337.7 279.6 595.4 562.6 7,446.7 6,703.0
Prime Agency Prime/Non-Agency Alt-A RMBS Subprime Mortgage-Backed Total
Securities
Origination Year Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost
2014 120.0 119.0 — — — 120.0 119.0
2013 726.2 718.4 — — — 726.2 718.4
2012 784.6 794.0 — — — 784.6 794.0
2011 1,021.3 999.2 — — — 1,021.3 999.2
2010 681.4 659.4 24.3 23.3 — — 705.7 682.7
2009 275.9 273.1 9.3 9.4 — — 285.2 282.5
2008 155.0 142.1 — — — 155.0 142.1
2007 342.1 305.5 167.7 155.4 72.4 60.8 175.8 157.4 758.0 679.1
2006 405.7 292.6 267.5 191.4 90.3 61.3 157.8 138.5 921.3 683.8
2005 and prior 1,041.8 751.5 490.8 426.5 175.0 157.5 261.8 266.7 1,969.4 1,602.2
Total by origination year 5,554.0 5,054.8 959.6 806.0 337.7 279.6 595.4 562.6 7,446.7 6,703.0
| (1) |
|
Subprime mortgage-backed securities are included in RMBS under this presentation. |
(2) Includes fixed maturities securities related to businesses exited through reinsurance. Refer to page in “Additional Information” section.
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CMBS and Other Asset-Backed Securities Summary
(in millions USD)
CMBS
By Rating and Vintage
As of June 30, 2014
AAA AA A BBB BB B & Below Total
Amortized Amortized Amortized Amortized Amortized Amortized
Origination Year Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Amortized Cost
2014 181.4 176.8 — — — — — 181.4 176.8
2013 390.6 375.1 — — — — — 390.6 375.1
2012 11.1 10.7 — — — — — 11.1 10.7
2010 8.0 8.0 0.3 0.3 — — — — 8.3 8.3
2008 — — — 11.4 9.5 — — 11.4 9.5
2007 135.9 124.3 271.3 246.5 156.3 142.7 236.3 197.7 191.9 177.1 158.3 128.3 1,150.0 1,016.6
2006 541.7 508.4 184.1 170.6 151.2 139.0 211.6 191.1 98.6 75.7 28.9 22.5 1,216.1 1,107.3
2005 and prior 546.8 531.4 157.8 150.9 118.2 112.0 68.3 62.5 37.4 28.1 13.7 7.0 942.2 891.9
Total by origination year 1,815.5 1,734.7 613.5 568.3 425.7 393.7 527.6 460.8 327.9 280.9 200.9 157.8 3,911.1 3,596.2
Other Asset-Backed Securities*
By Rating and Classification
As of June 30, 2014
Credit Card Receivables Automobile Receivables CLO’s** Other Total
Amortized Amortized Amortized Amortized Amortized
ARO Rating Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost
AAA 616.9 598.1 424.5 423.5 12.5 11.1 210.5 202.4 1,264.4 1,235.1
AA — — 24.0 23.3 7.1 7.6 31.1 30.9
A 21.5 20.9 — 46.6 45.3 17.7 18.0 85.8 84.2
BBB — — — 23.3 22.7 23.3 22.7
BB — — — 0.2 0.2 0.2 0.2
B and below — — — 0.9 0.1 0.9 0.1
Total by rating 638.4 619.0 424.5 423.5 83.1 79.7 259.7 251.0 1,405.7 1,373.2
Credit Card Receivables Automobile Receivables CLO’s** Other Total
Amortized Amortized Amortized Amortized Amortized
NAIC Designation Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost Fair Value Cost
| 1 |
|
638.4 619.0 424.5 423.5 83.1 79.7 235.3 228.0 1,381.3 1,350.2 |
| 2 |
|
— — — 23.3 22.7 23.3 22.7 |
| 3 |
|
— — — 0.2 0.2 0.2 0.2 |
| 4 |
|
— — — — — |
| 5 |
|
— — — — — |
| 6 |
|
— — — 0.9 0.1 0.9 0.1 |
Total by rating 638.4 619.0 424.5 423.5 83.1 79.7 259.7 251.0 1,405.7 1,373.2
* Subprime asset-backed securities are excluded from Other Asset-Backed Securities and included in Non-Agency RMBS under this presentation.
** Excludes consolidated CLO’s
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Mortgage Loans on Real Estate
(in millions USD)
Mortgage Loans on Real Estate by Region and Property
Type
Balances as of
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
U.S. Region Amount% of Total Amount% of Total Amount% of Total Amount% of Total Amount% of Total
Pacific 2,339.7 24.6% 2,369.2 25.6% 2,281.8 24.5% 2,054.5 22.7% 2,090.2 23.3%
South Atlantic 2,032.9 21.4% 1,964.6 21.2% 1,936.0 20.8% 1,851.4 20.5% 1,706.6 19.1%
Middle Atlantic 1,201.8 12.7% 1,113.2 12.0% 1,112.0 11.9% 1,107.2 12.3% 1,142.8 12.8%
East North Central 1,124.2 11.8% 1,055.6 11.4% 1,037.5 11.1% 962.7 10.7% 1,006.7 11.3%
West South Central 1,134.3 11.9% 1,112.7 12.0% 1,122.3 12.0% 1,232.9 13.7% 1,246.3 14.0%
Mountain 809.2 8.5% 771.7 8.3% 790.4 8.5% 749.7 8.3% 711.1 8.0%
West North Central 509.6 5.4% 525.6 5.7% 517.2 5.6% 519.4 5.8% 502.7 5.6%
New England 147.9 1.6% 150.2 1.6% 318.1 3.4% 318.9 3.5% 322.1 3.6%
East South Central 195.1 2.1% 198.7 2.2% 200.7 2.2% 222.9 2.5% 204.7 2.3%
Total Commercial Mortgage Loans (1) 9,494.7 100.0% 9,261.5 100.0% 9,316.0 100.0% 9,019.6 100.0% 8,933.2 100.0%
Property Type
Industrial 2,731.2 28.7% 2,818.6 30.4% 2,848.0 30.6% 2,998.0 33.3% 3,183.5 35.7%
Retail 2,949.1 31.0% 2,951.0 31.9% 2,936.9 31.5% 2,795.9 31.0% 2,653.1 29.7%
Office 1,193.3 12.6% 1,089.0 11.7% 1,242.2 13.3% 1,243.3 13.8% 1,280.9 14.3%
Apartments 1,440.5 15.2% 1,348.7 14.6% 1,296.1 13.9% 1,048.6 11.6% 994.1 11.1%
Hotel/Motel 414.2 4.4% 382.1 4.1% 430.6 4.6% 364.1 4.0% 323.3 3.6%
Other 416.7 4.4% 366.3 4.0% 378.1 4.1% 382.3 4.2% 341.0 3.8%
Mixed Use 349.7 3.7% 305.8 3.3% 184.1 2.0% 187.4 2.1% 157.3 1.8%
Total Commercial Mortgage Loans (1) 9,494.7 100.0% 9,261.5 100.0% 9,316.0 100.0% 9,019.6 100.0% 8,933.2 100.0%
Loan Size
Under $5 million 1,439.6 15.2% 1,507.8 16.3% 1,516.5 16.3% 1,546.5 17.1% 1,607.7 18.0%
$5 million but less than $10 million 1,587.4 16.7% 1,549.4 16.7% 1,582.2 17.0% 1,548.9 17.2% 1,601.5 17.9%
$10 million but less than $20 million 2,100.0 22.1% 1,936.7 20.9% 1,899.5 20.4% 1,746.6 19.4% 1,725.0 19.3%
$20 million but less than $30 million 1,159.5 12.2% 1,097.7 11.9% 1,077.7 11.6% 1,045.0 11.6% 1,085.7 12.2%
$30 million and over 3,208.2 33.8% 3,169.9 34.2% 3,240.1 34.7% 3,132.6 34.7% 2,913.3 32.6%
Total Commercial Mortgage Loans (1) 9,494.7 100.0% 9,261.5 100.0% 9,316.0 100.0% 9,019.6 100.0% 8,933.2 100.0%
Other Stats as ratios
LTV—Origination 59.3% 59.2% 59.0% 58.8% 58.5%
LTV—Current 55.8% 55.8% 55.5% 56.1% 55.5%
Debt Service Coverage 1.9 2.0 2.0 1.9 1.9
Other Stats in USD millions
60+day delinq (incl in process of foreclosure)
US GAAP Book Value — 5.1 5.1 9.0
Allowance for loan losses 3.3 3.4 3.8 4.0 4.1
| (1) |
|
Total Commercial Mortgage Loans shown do not include allowance for mortgage loan credit losses |
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U.S. and Foreign Corporate Securities
(in millions USD)
Summary of Corporate Securities by
Industry Category
Balances as of
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
Fair Value% of Total Fair Value% of Total Fair Value% of Total Fair Value% of Total Fair Value% of Total
Type Industry
Communications 4,113.4 9.8% 4,001.1 9.8% 3,835.1 9.8% 3,849.3 9.9% 3,893.5 10.2%
Financial 6,935.2 16.6% 6,641.5 16.3% 6,177.7 15.8% 5,950.3 15.2% 5,629.2 14.7%
Industrial and other companies 22,795.9 54.5% 22,240.0 54.8% 21,556.7 55.1% 21,770.6 55.8% 21,014.9 55.0%
Public Utilities 6,911.1 16.5% 6,690.3 16.5% 6,472.2 16.6% 6,439.4 16.5% 6,641.3 17.4%
Transportation 1,097.1 2.6% 1,068.6 2.6% 1,036.1 2.7% 1,021.7 2.6% 1,037.6 2.7%
Sub-total 41,852.7 100.0% 40,641.5 100.0% 39,077.8 100.0% 39,031.3 100.0% 38,216.5 100.0%
Communications 387.9 2.7% 340.0 2.4% 400.7 2.9% 405.2 3.0% 426.2 3.2%
Financial 1,013.0 7.0% 982.2 6.8% 957.0 7.0% 948.2 7.0% 918.6 6.8%
Industrial and other companies 9,394.6 64.9% 9,390.9 65.3% 8,706.4 63.6% 8,741.8 64.7% 8,660.6 64.0%
Private Utilities 3,226.8 22.3% 3,182.8 22.2% 3,156.2 23.0% 2,926.5 21.7% 3,006.5 22.3%
Transportation 443.3 3.1% 469.5 3.3% 485.6 3.5% 489.7 3.6% 494.6 3.7%
Sub-total 14,465.6 100.0% 14,365.4 100.0% 13,705.9 100.0% 13,511.4 100.0% 13,506.5 100.0%
Communications 4,501.3 8.0% 4,341.1 7.9% 4,235.8 8.0% 4,254.5 8.1% 4,319.7 8.4%
Financial 7,948.2 14.1% 7,623.7 13.9% 7,134.7 13.5% 6,898.5 13.1% 6,547.8 12.7%
Industrial and other companies 32,190.5 57.2% 31,630.9 57.5% 30,263.1 57.4% 30,512.4 58.1% 29,675.5 57.3%
Total Utilities 10,137.9 18.0% 9,873.1 17.9% 9,628.4 18.2% 9,365.9 17.8% 9,647.8 18.6%
Transportation 1,540.4 2.7% 1,538.1 2.8% 1,521.7 2.9% 1,511.4 2.9% 1,532.2 3.0%
Total 56,318.3 100.0% 55,006.9 100.0% 52,783.7 100.0% 52,542.7 100.0% 51,723.0 100.0%
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Exposure to European Debt-Fixed Maturities and Equity Securities
(in millions USD)
Exposure to Select European Countries Sovereign Debt Corporate—Financial Corporate—Non-Financial Total Total
As of June 30, 2014 Fair Value% of Total Fair Value% of Total Fair Value% of Total Fair Value% of Total Amortized Cost% of Total
Ireland—0.0%—0.0% 270.3 3.4% 270.3 3.0% 250.4 3.0%
Italy—0.0%—0.0% 267.0 3.4% 267.0 2.9% 237.0 2.8%
Portugal—0.0%—0.0% 10.5 0.1% 10.5 0.1% 7.9 0.1%
Spain—0.0%—0.0% 253.3 3.2% 253.3 2.8% 230.4 2.7%
Total Peripheral Euro-Zone—0.0%—0.0% 801.1 10.1% 801.1 8.8% 725.7 8.6%
Austria—0.0%—0.0% 15.6 0.2% 15.6 0.2% 15.0 0.2%
Belgium 37.3 14.1%—0.0% 345.0 4.4% 382.3 4.2% 327.3 3.9%
Bulgaria 5.6 2.1%—0.0%—0.0% 5.6 0.1% 5.5 0.1%
Croatia 28.4 10.7%—0.0%—0.0% 28.4 0.3% 25.6 0.3%
Czech Republic—0.0%—0.0% 10.4 0.1% 10.4 0.1% 10.1 0.1%
Denmark—0.0%—0.0% 124.3 1.6% 124.3 1.4% 113.0 1.3%
Finland—0.0%—0.0% 18.7 0.2% 18.7 0.2% 17.0 0.2%
France—0.0% 160.6 16.9% 496.7 6.3% 657.3 7.2% 615.1 7.3%
Germany—0.0% 56.9 6.0% 698.8 8.9% 755.7 8.3% 711.4 8.5%
Hungary 6.1 2.3%—0.0%—0.0% 6.1 0.1% 5.9 0.1%
Iceland—0.0%—0.0%—0.0%—0.0%—0.0%
Kazakhstan 43.2 16.3% 1.4 0.1% 19.8 0.3% 64.4 0.7% 59.7 0.7%
Latvia 4.9 1.9%—0.0%—0.0% 4.9 0.1% 4.6 0.1%
Lithuania 34.5 13.0%—0.0%—0.0% 34.5 0.4% 30.4 0.4%
Luxembourg—0.0%—0.0% 31.6 0.4% 31.6 0.3% 30.6 0.4%
Netherlands—0.0% 191.2 20.1% 1,097.4 14.0% 1,288.6 14.2% 1,175.4 13.9%
Norway—0.0%—0.0% 286.6 3.6% 286.6 3.2% 275.3 3.3%
Russian Federation 76.2 28.8% 5.1 0.5% 94.6 1.2% 175.9 1.9% 164.0 2.0%
Slovakia 5.3 2.0%—0.0%—0.0% 5.3 0.1% 5.0 0.1%
Slovenia—0.0%—0.0%—0.0%—0.0%—0.0%
Sweden—0.0% 53.8 5.7% 123.6 1.6% 177.4 2.0% 164.4 2.0%
Switzerland—0.0% 156.2 16.5% 645.6 8.2% 801.8 8.8% 736.9 8.8%
Turkey 23.2 8.8%—0.0% 42.4 0.5% 65.6 0.7% 65.3 0.8%
United Kingdom—0.0% 323.7 34.2% 3,007.8 38.4% 3,331.5 36.7% 3,098.8 36.9%
Total Non-Peripheral Europe 264.7 100.0% 948.9 100.0% 7,058.9 89.9% 8,272.5 91.2% 7,656.3 91.4%
Total Europe 264.7 100.0% 948.9 100.0% 7,860.0 100.0% 9,073.6 100.0% 8,382.0 100.0%
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Additional Information
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Adjustments to Operating Earnings by Segment
(in millions USD) Three Months Ended Year-to-Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
DAC/VOBA and other intangibles unlocking (1)
Retirement 7.1(11.3) 4.0 40.0(1.4)(4.2) 1.6
Annuities 6.5 3.2 26.8 39.6 9.9 9.7 16.9
Total Retirement Solutions 13.6(8.1) 30.8 79.6 8.5 5.5 18.5
Investment Management — — — -
Individual Life(1.5)(7.1)(7.8) 20.2(4.9)(8.6)(7.6)
Employee Benefits(1.8)(4.6)(0.5) —(6.4) -
Total Insurance Solutions(3.3)(11.7)(8.3) 20.2(4.9)(15.0)(7.6)
Ongoing Business 10.3(19.8) 22.5 99.8 3.6(9.5) 10.9
Corporate — — — -
Total Closed Blocks — — — -
Total DAC/VOBA and other intangibles unlocking 10.3(19.8) 22.5 99.8 3.6(9.5) 10.9
Additional adjustments (2)
Retirement — 0.2 12.7 — -
Annuities — 0.8 12.7 — -
Total Retirement Solutions — 1.0 25.4 — -
Investment Management — 1.7 11.5 — -
Individual Life — 3.1 36.6 — -
Employee Benefits — 0.3 4.0 — -
Total Insurance Solutions — 3.4 40.6 — -
Ongoing Business — 6.1 77.5 — -
Corporate(41.0)(48.8)(43.8)(47.6)(43.2)(89.7)(85.1)
Total Closed Blocks —(0.4) 0.6 — -
Total non-recurring items and interest expense(41.0)(48.8)(38.1) 30.5(43.2)(89.7)(85.1)
Total adjustments to operating earnings
Retirement 7.1(11.3) 4.2 52.7(1.4)(4.2) 1.6
Annuities 6.5 3.2 27.6 52.3 9.9 9.7 16.9
Total Retirement Solutions 13.6(8.1) 31.8 105.0 8.5 5.5 18.5
Investment Management — 1.7 11.5 — -
Individual Life(1.5)(7.1)(4.7) 56.8(4.9)(8.6)(7.6)
Employee Benefits(1.8)(4.6)(0.2) 4.0 -(6.4) -
Total Insurance Solutions(3.3)(11.7)(4.9) 60.8(4.9)(15.0)(7.6)
Ongoing Business 10.3(19.8) 28.6 177.3 3.6(9.5) 10.9
Corporate(41.0)(48.8)(43.8)(47.6)(43.2)(89.7)(85.1)
Total Closed Blocks —(0.4) 0.6 — -
Total adjustments to operating earnings(30.7)(68.6)(15.6) 130.3(39.6)(99.2)(74.2)
| (1) |
|
DAC/VOBA and other intangibles unlocking excludes unlocking on net investment income |
from Lehman Recovery/LIHTC
(2)Additional adjustments include impact of interest expenses and the Net gain (loss) from
Lehman Recovery/LIHTC
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Voya Financial Page 64 of 70
Calculation and Reconciliation of ROE and ROC
Three Months Ended Twelve Months Ended (2)
6/30/14 3/31/14 12/31/12 9/30/13 6/30/13 6/30/14 12/31/13
(in millions USD, unless otherwise indicated)
GAAP Return on Equity (Quarter to Date)
Net income (loss) available to Voya Financial, Inc.‘s common shareholders 246.3 258.1 548.1 346.6(82.2) 1,399.1 600.5
Voya Financial, Inc. shareholders’ equity: end of period 14,818 14,002 13,272 12,770 12,472 14,818 13,272
Voya Financial, Inc. shareholders’ equity: average for period 14,410 13,637 13,021 12,621 12,931 13,422 13,574
GAAP Return on Equity 6.8% 7.6% 16.8% 11.0% -2.5% 10.4% 4.4%
Ongoing Business Adjusted Operating Return on Capital and Adjusted Operating Return on Equity
Ongoing Business adjusted operating earnings before income taxes 345.8 287.3 323.6 306.9 303.2 1,263.6 1,211.8
Income taxes on adjusted operating earnings (based on an assumed tax rate of 35%)(121.0)(100.6)(113.3)(107.4)(106.1)(442.3)(424.2)
Ongoing Business adjusted operating earnings after income taxes 224.8 186.7 210.3 199.5 197.1 821.3 787.6
Interest expense after-tax (1)(19.5)(19.6)(19.9)(19.9)(20.3)(79.0)(79.9)
Ongoing Business adjusted operating earnings after income taxes and interest expense 205.3 167.1 190.4 179.6 176.8 742.3 707.7
End of period capital for Ongoing Business 9,063 9,123 9,216 9,419 9,190 9,063 9,216
Average capital for Ongoing Business (2) 9,092 9,170 9,318 9,305 9,101 9,221 9,137
Average debt (based on 25% debt-to-capital ratio)(2,273)(2,293)(2,329)(2,326)(2,275)(2,305)(2,284)
Average equity for Ongoing Business 6,819 6,877 6,988 6,978 6,826 6,916 6,853
Adjusted Operating Return on Capital for Ongoing Business 9.9% 8.2% 9.0% 8.6% 8.7% 8.9% 8.6%
Adjusted Operating Return on Equity for Ongoing Business (1) 12.0% 9.7% 10.9% 10.3% 10.4% 10.7% 10.3%
(1) Assumes debt-to-capital ratio of 25% for all time periods presented, a weighted average pre-tax interest rate of 5.5% for all periods
prior to the third quarter of 2013, when the company completed recapitalization, and the actual weighted average pre-tax interest rate
for all periods starting with the third quarter of 2013.
(2) Effective with the twelve months ending March 31,2014, average capital and equity are calculated by taking the average of the
quarterly capital and equity averages for the trailing four quarters, whereas in previous periods, average capital and equity were
calculated by two point average (Beginning of Year and End of Current Period)
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VOYA FINANCIAL TM
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Operating Revenues by Segment
Three Months Ended Year-to-Date
(in millions USD) 6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Retirement 592.9 598.5 612.4 606.9 596.9 1,191.4 1,180.1
Annuities 330.8 354.4 313.9 319.1 304.0 685.2 611.6
Total Retirement Solutions 923.7 952.9 926.3 926.0 900.9 1,876.6 1,791.7
Investment Management 163.2 160.5 167.1 160.1 148.6 323.7 280.5
Individual Life 699.9 692.2 692.9 717.1 694.8 1,392.1 1,381.9
Employee Benefits 342.5 338.9 316.5 316.2 311.7 681.4 629.8
Total Insurance Solutions 1,042.4 1,031.1 1,009.4 1,033.3 1,006.5 2,073.5 2,011.7
Ongoing Business 2,129.3 2,144.5 2,102.8 2,119.4 2,056.0 4,273.8 4,083.9
Corporate 23.6 25.3 33.6 28.8 7.9 48.9 25.0
Total Closed Blocks 24.0 25.6 27.0 30.7 33.6 49.6 79.1
Total operating revenues 2,176.9 2,195.4 2,163.4 2,178.9 2,097.5 4,372.3 4,188.0
Adjustments:
Closed Block Variable Annuity 112.1 284.6(155.9)(66.1)(60.3) 396.7(504.3)
Net realized investment gains (losses) and
related charges and adjustments 67.0 49.6 129.1 39.8(41.9) 116.6(11.5)
Gain (loss) on change in fair value of derivatives
related to guaranteed benefits(24.3)(23.9)(21.8) 35.1 70.1(48.2) 90.7
Revenues related to business exited through
reinsurance or divestment 66.9 19.0(5.4)(2.9)(55.8) 85.9(67.9)
Revenues (loss) attributable to noncontrolling interests 219.1 60.8 157.1 152.9 60.9 279.9 101.2
Other adjustments to operating revenues* 80.4 85.4 97.4 97.6 70.1 165.8 163.0
Total revenue 2,698.1 2,670.9 2,364.0 2,435.3 2,140.6 5,369.0 3,959.2
| * |
|
Other adjustments to operating revenue includes: Fee income earned by |
the Company’s broker-dealers for sales of non-proprietary products, which
are reflected net of commission expense in the Company’s segments’
operating revenues, as well as other items where the income is passed on
to third parties.
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Ongoing Business Sources of Earnings Reconciliation
(in millions USD) Three Months Ended Year-to-Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Investment spread and other investment income:
Net investment income and net realized gains (losses)
Retirement 379.6 388.5 397.4 394.5 388.8 768.1 777.7
Annuities 275.8 270.6 283.4 295.9 283.5 546.4 570.6
Investment Management 8.0 7.3 11.7 16.4 6.1 15.3 8.9
Individual Life 215.5 219.8 224.5 258.7 215.4 435.3 432.3
Employee Benefits 27.7 26.7 29.2 32.1 27.9 54.4 56.3
Total net investment income and net realized gains (losses) 906.6 912.9 946.2 997.6 921.7 1,819.5 1,845.8
Total Ongoing Business 906.6 912.9 946.2 997.6 921.7 1,819.5 1,845.8
Adjustments:
Interest credited(540.4)(541.9)(553.7)(553.8)(551.3)(1,082.3)(1,103.5)
Other(4.3)(9.1)(7.8)(6.4)(9.4)(13.4)(17.6)
Total adjustments(544.7)(551.0)(561.5)(560.2)(560.7)(1,095.7)(1,121.1)
Ongoing investment spread and other investment income 361.9 361.9 384.7 437.4 361.0 723.8 724.7
Fee based margin:
Fee income
Retirement 192.9 191.1 196.1 191.0 189.0 384.0 372.8
Annuities 14.2 13.2 12.2 11.8 11.2 27.4 21.1
Investment Management 147.1 145.8 141.4 135.4 132.3 292.9 254.0
Individual Life 285.5 283.6 278.5 278.4 280.0 569.1 556.8
Employee Benefits 14.7 15.6 15.9 15.5 15.8 30.3 31.6
Total Fee Income 654.4 649.3 644.1 632.1 628.3 1,303.7 1,236.3
Other revenue
Retirement 17.0 18.2 18.2 20.7 15.3 35.2 25.3
Annuities 5.3 4.5 3.9 3.9 2.6 9.8 5.4
Investment Management 8.1 7.4 14.0 8.3 10.2 15.5 17.6
Individual Life 7.2 5.1 4.6 5.3 7.3 12.3 14.9
Employee Benefits(2.7) 0.3(1.0)(1.0)(1.0)(2.4)(2.0)
Total other revenue 34.9 35.5 39.7 37.2 34.4 70.4 61.2
Total Ongoing Business 689.3 684.8 683.8 669.3 662.7 1,374.1 1,297.5
Adjustments:
Surrender fees and MVA charges(7.1)(7.8)(6.5)(10.6)(11.3)(14.9)(12.8)
Insurance Solutions FAS 97 fees and unearned revenue reserve amortization/unlocking(294.1)(291.7)(288.9)(288.3)(288.7)(585.8)(574.3)
Other(2.8)(4.1) 0.3(0.7) 1.5(6.9)(2.6)
Total adjustments(304.0)(303.6)(295.1)(299.6)(298.5)(607.6)(589.7)
Ongoing fee based margin 385.3 381.2 388.7 369.7 364.2 766.5 707.8
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Ongoing Business Sources of Earnings Reconciliation
(in millions USD) Three Months Ended Year-to-Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Net underwriting gain (loss) and other revenue:
Premiums
Retirement 3.4 0.7 0.7 0.7 3.8 4.1 4.3
Annuities 35.5 66.1 14.4 7.5 6.7 101.6 14.5
Investment Management — — — -
Individual Life 191.7 183.7 185.3 174.7 192.1 375.4 377.9
Employee Benefits 302.8 296.3 272.4 269.6 269.0 599.1 543.9
Total premiums 533.4 546.8 472.8 452.5 471.6 1,080.2 940.6
Interest credited and other policyholder benefits
Retirement(209.3)(210.7)(218.2)(213.5)(212.1)(420.0)(416.7)
Annuities(197.4)(229.8)(180.4)(182.2)(183.9)(427.2)(368.3)
Investment Management — — — -
Individual Life(499.3)(527.8)(518.8)(468.7)(512.4)(1,027.1)(1,014.0)
Employee Benefits(239.6)(244.5)(223.9)(223.7)(213.2)(484.1)(455.8)
Total interest credited and other policyholder benefits(1,145.6)(1,212.8)(1,141.3)(1,088.1)(1,121.6)(2,358.4)(2,254.8)
Total Ongoing Business(612.2)(666.0)(668.5)(635.6)(650.0)(1,278.2)(1,314.2)
Adjustments:
Interest credited 540.4 541.9 553.7 553.8 551.3 1,082.3 1,103.5
Surrender fees and MVA charges 7.1 7.8 6.5 10.6 11.3 14.9 12.8
Insurance Solutions FAS 97 fees and unearned revenue reserve amortization/unlocking 293.9 288.0 289.6 297.8 287.2 581.9 572.1
Sales inducements amortization and unlocking 7.6 8.3 6.4 6.1 12.0 15.9 22.1
FAS 113 and SOP 03-1 amortization and unlocking 0.4 6.7 6.6(23.1) 7.2 7.1 13.6
Other(17.8)(13.1)(13.6)(10.7)(14.9)(30.9)(25.9)
Total adjustments 831.6 839.6 849.2 834.5 854.1 1,671.2 1,698.2
Ongoing net underwriting gain (loss) and other revenue 219.4 173.6 180.7 198.9 204.1 393.0 384.0
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Ongoing Business Sources of Earnings Reconciliation
(in millions USD) Three Months Ended Year-to-Date
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13 6/30/14 6/30/13
Administrative expenses and trail commissions:
Operating and interest expense
Retirement(217.3)(226.0)(220.1)(205.8)(210.0)(443.3)(414.0)
Annuities(36.6)(35.5)(32.1)(31.7)(32.2)(72.1)(63.2)
Investment Management(108.3)(110.7)(114.2)(106.1)(107.5)(219.0)(209.3)
Individual Life(91.3)(95.7)(88.9)(83.9)(94.8)(187.0)(186.6)
Employee Benefits(60.9)(68.4)(57.1)(58.5)(60.5)(129.3)(120.5)
Total operating and interest expense(514.4)(536.3)(512.4)(486.0)(505.0)(1,050.7)(993.6)
Total Ongoing Business(514.4)(536.3)(512.4)(486.0)(505.0)(1,050.7)(993.6)
Adjustments:
Other 25.4 26.2 21.9 17.9 22.9 51.6 45.1
Total adjustments 25.4 26.2 21.9 17.9 22.9 51.6 45.1
Ongoing administrative expenses and trail commissions(489.0)(510.1)(490.5)(468.1)(482.1)(999.1)(948.5)
DAC/VOBA and other intangibles amortization and unlocking:
Net amortization of DAC/VOBA
Retirement(30.5)(46.9)(35.5)(0.3)(42.7)(77.4)(79.5)
Annuities(32.6)(34.3)(18.2)(8.4)(28.4)(66.9)(66.3)
Investment Management — — — -
Individual Life(45.9)(37.6)(38.2)(47.5)(47.6)(83.5)(90.5)
Employee Benefits(4.2)(9.1)(5.0)(4.9)(3.9)(13.3)(7.0)
Total net amortization of DAC/VOBA(113.2)(127.9)(96.9)(61.1)(122.6)(241.1)(243.3)
Total Ongoing Business(113.2)(127.9)(96.9)(61.1)(122.6)(241.1)(243.3)
Adjustments
Sales inducements amortization and unlocking(7.6)(8.3)(6.4)(6.1)(12.0)(15.9)(22.1)
FAS 113 and SOP 03-1 amortization and unlocking(0.4)(6.7)(6.6) 23.1(7.2)(7.1)(13.6)
Unearned revenue reserve amortization and unlocking 0.2 3.7(0.7)(9.5) 1.5 3.9 2.2
Other(0.5) 0.1(0.8)(0.1)(0.1)(0.4) 1.0
Total adjustments(8.3)(11.2)(14.5) 7.4(17.8)(19.5)(32.5)
Ongoing DAC/VOBA and other intangibles amortization and unlocking(121.5)(139.1)(111.4)(53.7)(140.4)(260.6)(275.8)
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Fixed Maturity Securities—Businesses Exited Through Reinsurance
(in millions USD)
Total investments, after consolidation (See Portfolio Composition page), include the
following amounts related to businesses exited through reinsurance:
Balances as of
6/30/14 3/31/14 12/31/13 9/30/13 6/30/13
Fixed Maturity Securities—Businesses Exited Through Reinsurance
Security Sector
U.S. Government agencies and authorities 73.3 86.1 73.9 52.1 87.1
U.S. Corporate—Public 1,437.7 818.8 838.8 861.2 896.6
Foreign Government / Agency ——3.4 3.4
Foreign Corporate—Public 225.9 135.6 132.6 137.8 138.5
State, municipalities and political subdivisions 108.8 107.1 102.6 104.1 108.2
Residential mortgaged-backed securities:
Agency 77.4 81.2 90.2 97.2 107.9
Non—Agency 100.6 0.9 1.1 1.2 1.5
Total Residential mortgage-backed securities 178.0 82.1 91.3 98.4 109.4
Commercial mortgage-backed securities 109.7 88.2 91.4 94.3 100.3
Other asset-backed securities 95.6 17.8 18.1 18.5 19.0
Total fixed maturities, including securities pledged 2,229.0 1,335.7 1,348.7 1,369.8 1,462.5
Fixed Maturity Securities—Businesses Exited Through Reinsurance as of June 30, 2014
By ARO Rating
Total AAA AA A BBB BB B & Below
Residential mortgaged-backed securities:
Agency 77.4 77.4 — — -
Non—Agency 100.6 ——0.6 0.3 99.7
Total Residential mortgage-backed securities 178.0 77.4 — 0.6 0.3 99.7
Commercial mortgage-backed securities 109.7 55.7 5.1 14.2 21.5 6.2 7.0
Other asset-backed securities 95.6 17.2 24.2 41.1 13.1 —
Total Structured securities 383.3 150.3 29.3 55.3 35.2 6.5 106.7
Non-structured securities 1,845.7 118.0 212.4 937.2 578.0 0.1 -
Total fixed maturities securities 2,229.0 268.3 241.7 992.5 613.2 6.6 106.7
Fixed Maturity Securities—Businesses Exited Through Reinsurance as of March 31, 2014
By ARO Rating
Total AAA AA A BBB BB B & Below
Residential mortgaged-backed securities:
Agency 81.2 81.2 — — -
Non—Agency 0.9 ——0.6 0.3 -
Total Residential mortgage-backed securities 82.1 81.2 — 0.6 0.3 -
Commercial mortgage-backed securities 88.2 61.5 4.9 8.6 6.3—6.9
Other asset-backed securities 17.8 17.5 0.3 — —
Total Structured securities 188.1 160.2 5.2 8.6 6.9 0.3 6.9
Non-structured securities 1,147.6 130.3 189.0 668.6 159.6 0.1 -
Total fixed maturities securities 1,335.7 290.5 194.2 677.2 166.5 0.4 6.9
Fixed Maturity Securities—Businesses Exited Through Reinsurance as of June 30, 2014
By NAIC Designation
Total 1 2 3 4 5 6
Residential mortgaged-backed securities:
Agency 77.4 77.4 — — -
Non—Agency 100.6 88.6 12.0 — —
Total Residential mortgage-backed securities 178.0 166.0 12.0 — —
Commercial mortgage-backed securities 109.7 88.2 15.3 6.2 — -
Other asset-backed securities 95.6 82.5 13.1 — —
Total Structured securities 383.3 336.7 40.4 6.2 — -
Non-structured securities 1,845.7 1,267.6 578.0 0.1 — -
Total fixed maturities securities 2,229.0 1,604.3 618.4 6.3 — -
Fixed Maturity Securities—Businesses Exited Through Reinsurance as of March 31, 2014
By NAIC Designation
Total 1 2 3 4 5 6
Residential mortgaged-backed securities:
Agency 81.2 81.2 — — -
Non—Agency 0.9 0.9 — — -
Total Residential mortgage-backed securities 82.1 82.1 — — -
Commercial mortgage-backed securities 88.2 88.2 — — -
Other asset-backed securities 17.8 17.8 — — -
Total Structured securities 188.1 188.1 — — -
Non-structured securities 1,147.6 987.9 159.6 0.1 — -
Total fixed maturities securities 1,335.7 1,176.0 159.6 0.1 — -
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Ratings
A.M. Best Fitch Standard & Poor’s Moody’s
Insurance Financial Strength Ratings
ING Life Insurance and Annuity Company A A- A- A3
ING USA Annuity & Life Insurance Company A A- A- A3
Midwestern United Life Insurance Company A- NR A- NR
ReliaStar Life Insurance Company A A- A- A3
ReliaStar Life Insurance Company of New York A A- A- A3
Security Life of Denver Insurance Company A A- A- A3
Credit Ratings
Voya Financial, Inc.
Long-Term Issuer Credit bbb BBB BBB- Baa3
Long-Term Senior Unsecured Debt bbb BBB- BBB- Baa3
Junior Subordinated Debt bb+ BB BB Ba1 (hyb)
Lion Connecticut Holdings, Inc.
Long-Term Issuer Credit NR NR BBB- Baa3
Investor Information
Corporate Offices: Media Contact: Investor Contact:
Voya Financial Christopher Breslin Darin Arita
230 Park Avenue 212-309-8941 212-309-8999
New York, New York 10169 Christopher.Breslin@voya.com IR@voya.com
NYSE Ticker: Web Site:
VOYA investors.voya.com
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