For the fourth quarter of 2012, after-tax adjusted operating income for the Financial Services Businesses amounted to $798 million ($1.69 per Common share) compared to $855 million ($1.78 per Common share) for the fourth quarter of 2011. The net loss for the Financial Services Businesses attributed to Prudential Financial, Inc. for the fourth quarter of 2012 amounted to $214 million (48 cents per Common share) compared to net income of $522 million ($1.08 per Common share) for the fourth quarter of 2011.
The Company acquired AIG Star Life Insurance Co., Ltd. and AIG Edison Life Insurance Company on February 1, 2011. Results of the Financial Services Businesses include the results of these businesses from the date of acquisition.
Reported results for the fourth quarter of 2012 and earlier periods presented reflect the implementation of a discretionary change in accounting principle related to the Company’s pension plans, as discussed under “Change in Accounting Principle” later in this release.
Results of the majority of the Company’s international investments operations, formerly included in the International Insurance segment, have been reclassified and included in the Asset Management segment for all periods presented herein. This reflects the Company’s decision to align the management of these businesses.“We are pleased with the progress we’ve made over the past year toward achievement of our longer term objectives. We are continuing to benefit from strong business momentum, with a growing base of quality business driven by solid sales and flows. We surpassed significant milestones during the year, including $1 trillion of assets under management, over $400 billion of account values in our Retirement and Annuities businesses, and annualized new business premiums of over $4 billion in International Insurance. We’ve strengthened our U.S. businesses with the completion of two major ground breaking pension risk transfer transactions in the fourth quarter, building a leadership position in an attractive market well suited to our proficiencies. These transactions speak to our capabilities, our culture of multi-discipline collaboration, and our financial strength. Our acquisition of The Hartford’s individual life insurance business, which was completed early this year, is also expected to provide financial and strategic benefits. Our International Insurance business continues to perform well, with results benefiting from growth in multiple distribution channels and our achievement of cost synergies consistent with our goals through the successful integration of the acquired Star and Edison businesses. Our unique business mix, the quality of the businesses that make up that mix, and the talent of our people support our prospects for achievement of strong returns consistent with our targets as well as continued growth,” said Chairman and Chief Executive Officer John Strangfeld.