XML 53 R39.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Schedule II - Condensed Financial Information of Registrant | 12 Months Ended
--- | ---
Dec. 31, 2023
Condensed Financial Information Disclosure [Abstract] |
Schedule II - Condensed Financial Information of Registrant | PRUDENTIAL FINANCIAL, INC. Schedule II Condensed Financial Information of Registrant Condensed Statements of Financial Positions as of December 31, 2023 and 2022 (in millions)
|  | 2023 |  | 2022
ASSETS |  |  |  |
Fixed maturities, available-for-sale, at fair value (amortized cost: 2023- $1,519; 2022- $1,719) |  | $ | 1,386 |  |  | $ | 1,564 |
Equity securities, at fair value (cost: 2023- $25; 2022- $25) |  | 25 |  |  | 25 |
Other invested assets |  | 2,237 |  |  | 2,495 |
Total investments |  | 3,648 |  |  | 4,084 |
Cash and cash equivalents |  | 971 |  |  | 1,396 |
Due from subsidiaries |  | 2,377 |  |  | 2,841 |
Loans receivable from subsidiaries |  | 7,448 |  |  | 8,032 |
Investment in subsidiaries(1) |  | 38,519 |  |  | 41,390 |
Property, plant and equipment |  | 404 |  |  | 413 |
Income taxes receivable |  | 682 |  |  | 0 |
Other assets |  | 315 |  |  | 116 |
TOTAL ASSETS |  | $ | 54,364 |  |  | $ | 58,272 |
LIABILITIES AND EQUITY |  |  |  |
LIABILITIES |  |  |  |
Due to subsidiaries |  | $ | 3,166 |  |  | $ | 3,705 |
Loans payable to subsidiaries |  | 4,602 |  |  | 4,279 |
Short-term debt |  | 25 |  |  | 25 |
Long-term debt |  | 18,162 |  |  | 19,162 |
Income taxes payable |  | 100 |  |  | 71 |
Other liabilities |  | 489 |  |  | 437 |
Total liabilities |  | 26,544 |  |  | 27,679 |
EQUITY |  |  |  |
Preferred Stock ($0.01 par value; 10,000,000 shares authorized; none issued) |  | 0 |  |  | 0 |
Common Stock ($0.01 par value; 1,500,000,000 shares authorized; 666,305,189 shares issued as of December 31, 2023 and December 31, 2022) |  | 6 |  |  | 6 |
Additional paid-in capital |  | 25,746 |  |  | 25,747 |
Common Stock held in treasury, at cost (307,089,216 and 300,342,458 shares as of December 31, 2023 and 2022, respectively) |  | (23,780) |  |  | (23,068) |
Accumulated other comprehensive income (loss)(1) |  | (6,504) |  |  | (3,806) |
Retained earnings(1) |  | 32,352 |  |  | 31,714 |
Total equity |  | 27,820 |  |  | 30,593 |
TOTAL LIABILITIES AND EQUITY |  | $ | 54,364 |  |  | $ | 58,272 |
__________ (1) Prior period amounts adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts. See Notes to Condensed Financial Information of Registrant PRUDENTIAL FINANCIAL, INC. Schedule II Condensed Financial Information of Registrant Condensed Statements of Operations for the Years Ended December 31, 2023, 2022 and 2021 (in millions)
|  | 2023 |  | 2022 |  | 2021
REVENUES |  |  |  |  |  |
Net investment income |  | $ | 345 |  |  | $ | 177 |  |  | $ | 62 |
Realized investment gains (losses), net |  | (4) |  |  | 128 |  |  | 90 |
Affiliated interest revenue |  | 408 |  |  | 387 |  |  | 358 |
Other income (loss) |  | 14 |  |  | 27 |  |  | 18 |
Total revenues |  | 763 |  |  | 719 |  |  | 528 |
EXPENSES |  |  |  |  |  |
General and administrative expenses |  | 173 |  |  | 71 |  |  | 166 |
Interest expense |  | 1,282 |  |  | 1,161 |  |  | 1,088 |
Total expenses |  | 1,455 |  |  | 1,232 |  |  | 1,254 |
INCOME (LOSS) BEFORE INCOME TAXES AND EQUITY IN EARNINGS OF SUBSIDIARIES AND OPERATING JOINT VENTURES |  | (692) |  |  | (513) |  |  | (726) |
Total income tax expense (benefit) |  | (152) |  |  | (134) |  |  | (130) |
INCOME (LOSS) BEFORE EQUITY IN EARNINGS OF SUBSIDIARIES AND OPERATING JOINT VENTURES |  | (540) |  |  | (379) |  |  | (596) |
Equity in earnings of subsidiaries(1) |  | 3,023 |  |  | (1,268) |  |  | 9,464 |
Equity in earnings of operating joint ventures, net of taxes |  | 5 |  |  | 0 |  |  | 0 |
NET INCOME (LOSS) |  | $ | 2,488 |  |  | $ | (1,647) |  |  | $ | 8,868 |
Other Comprehensive Income (loss)(1) |  | (2,698) |  |  | 5,687 |  |  | 2,165 |
TOTAL COMPREHENSIVE INCOME (LOSS) |  | $ | (210) |  |  | $ | 4,040 |  |  | $ | 11,033 |
__________ (1) Prior period amounts adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts. See Notes to Condensed Financial Information of Registrant PRUDENTIAL FINANCIAL, INC. Schedule II Condensed Financial Information of Registrant Condensed Statements of Cash Flows for the Years Ended December 31, 2023, 2022 and 2021 (in millions)
|  | 2023 |  | 2022 |  | 2021
CASH FLOWS FROM OPERATING ACTIVITIES |  |  |  |  |  |
Net income (loss)(1) |  | $ | 2,488 |  |  | $ | (1,647) |  |  | $ | 8,868 |
Adjustments to reconcile net income to cash provided by operating activities: |  |  |  |  |  |
Equity in earnings of subsidiaries(1) |  | (3,023) |  |  | 1,268 |  |  | (9,464) |
Equity in earnings of operating joint ventures, net of taxes |  | (5) |  |  | 0 |  |  | 0 |
Realized investment (gains) losses, net |  | 4 |  |  | (128) |  |  | (90) |
Dividends received from subsidiaries |  | 3,705 |  |  | 3,967 |  |  | 3,239 |
Property, plant and equipment |  | (15) |  |  | (8) |  |  | (4) |
Change in: |  |  |  |  |  |
Due to/from subsidiaries, net |  | 212 |  |  | 681 |  |  | (513) |
Other, operating |  | (487) |  |  | 39 |  |  | 63 |
Cash flows from (used in) operating activities |  | 2,879 |  |  | 4,172 |  |  | 2,099 |
CASH FLOWS FROM INVESTING ACTIVITIES |  |  |  |  |  |
Proceeds from the sale/maturity of: |  |  |  |  |  |
Fixed maturities, available-for-sale |  | 372 |  |  | 76 |  |  | 969 |
Short-term investments |  | 19,196 |  |  | 23,529 |  |  | 15,718 |
Payments for the purchase of: |  |  |  |  |  |
Fixed maturities, available-for-sale |  | (171) |  |  | (744) |  |  | (500) |
Short-term investments |  | (18,938) |  |  | (24,080) |  |  | (13,795) |
Capital contributions to subsidiaries |  | (1,651) |  |  | (2,527) |  |  | (874) |
Returns of capital contributions from subsidiaries |  | 599 |  |  | 2,098 |  |  | 430 |
Loans to subsidiaries, net of maturities |  | 584 |  |  | (157) |  |  | 151 |
Other, investing |  | 0 |  | 0 |  | 7
Cash flows from (used in) investing activities |  | (9) |  |  | (1,805) |  |  | 2,106 |
CASH FLOWS FROM FINANCING ACTIVITIES |  |  |  |  |  |
Cash dividends paid on Common Stock |  | (1,846) |  |  | (1,817) |  |  | (1,814) |
Common Stock acquired |  | (1,012) |  |  | (1,488) |  |  | (2,500) |
Common Stock reissued for exercise of stock options |  | 126 |  |  | 163 |  |  | 200 |
Proceeds from the issuance of debt (maturities longer than 90 days) |  | 495 |  | 2,474 |  |  | 0
Repayments of debt (maturities longer than 90 days) |  | (1,514) |  |  | (1,005) |  |  | (1,308) |
Repayments of loans from subsidiaries |  | (660) |  |  | (1,811) |  |  | 151 |
Proceeds from loans payable to subsidiaries |  | 1,256 |  |  | 1,386 |  |  | 1,411 |
Net change in financing arrangements (maturities of 90 days or less) |  | 1 |  |  | (2) |  | 0
Other, financing |  | (141) |  |  | (122) |  |  | (156) |
Cash flows from (used in) financing activities |  | (3,295) |  |  | (2,222) |  |  | (4,016) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS |  | (425) |  |  | 145 |  |  | 189 |
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR |  | 1,396 |  |  | 1,251 |  |  | 1,062 |
CASH AND CASH EQUIVALENTS, END OF YEAR |  | $ | 971 |  |  | $ | 1,396 |  |  | $ | 1,251 |
SUPPLEMENTAL CASH FLOW INFORMATION |  |  |  |  |  |
Cash paid during the period for interest |  | $ | 1,224 |  |  | $ | 1,071 |  |  | $ | 1,050 |
Cash paid (refunds received) during the period for taxes |  | $ | 554 |  |  | $ | (231) |  |  | $ | (330) |
NON-CASH TRANSACTIONS DURING THE YEAR |  |  |  |  |  |
Non-cash capital contributions to subsidiaries |  | $ | (753) |  |  | $ | (620) |  |  | $ | (3,607) |
Non-cash dividends/returns of capital from subsidiaries |  | $ | 1,067 |  |  | $ | 501 |  |  | $ | 4,582 |
Treasury Stock shares issued for stock-based compensation programs |  | $ | 275 |  |  | $ | 235 |  |  | $ | 138 |
__________ (1) Prior period amounts adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts. See Notes to Condensed Financial Information of Registrant PRUDENTIAL FINANCIAL, INC. Schedule II Condensed Financial Information of Registrant Notes to Condensed Financial Information of Registrant ORGANIZATION AND PRESENTATION Prudential Financial, Inc. (“Prudential Financial”) was incorporated on December 28, 1999, as a wholly-owned subsidiary of The Prudential Insurance Company of America (“PICA”). On December 18, 2001, PICA converted from a mutual life insurance company to a stock life insurance company and became an indirect, wholly-owned subsidiary of Prudential Financial. The condensed financial information of Prudential Financial, Inc. (the “Parent Company”) should be read in conjunction with the consolidated financial statements of Prudential Financial, Inc. and its subsidiaries and the notes thereto (the “Consolidated Financial Statements”). The condensed financial statements of Prudential Financial reflect its direct wholly-owned subsidiaries using the equity method of accounting. In September 2023, the Company invested approximately $200 million, and acquired a 20% equity interest as a limited partner, in Prismic Life Holding Company LP (“Prismic”), a Bermuda-exempted limited partnership that owns all of the outstanding capital stock of Prismic Life Reinsurance, Ltd. (“Prismic Re”), a licensed Bermuda-based life and annuity reinsurance company. As this investment is accounted for under the equity method, both Prismic and Prismic Re are considered related parties. In April 2022, the Company completed the sale of Prudential Annuities Life Assurance Corporation (“PALAC”), a subsidiary of Prudential Financial, representing a portion of its in-force traditional variable annuity block of business, to Fortitude Group Holdings, LLC (“Fortitude”). The Company recognized a pre-tax gain on sale of $1,448 million. In April 2022, the Company completed the sale of its Full Service Retirement business to Great-West Life & Annuity Insurance Company (“Great-West”), primarily through a combination of (i) the sale of all of the outstanding equity interests of certain legal entities, including Prudential Retirement Insurance and Annuity Company (“PRIAC”); (ii) the ceding of certain insurance policies through reinsurance; and (iii) the sale, transfer and/or novation of certain in-scope contracts and brokerage accounts. The Company recognized a net pre-tax gain on sale of $650 million, as well as a deferred gain of approximately $400 million in 2022, including a post-closing true-up, for the ceding of certain insurance policies through reinsurance to Great-West. In June 2021, Prudential International Insurance Holdings, Ltd. (“PIIH”), a subsidiary of Prudential Financial, completed the sale of The Prudential Life Insurance Company of Taiwan Inc. (“POT”) to Taishin Financial Holding Co, Ltd. (the “Buyer”) for cash consideration of approximately NT$5.5 billion, equal to approximately $200 million at then current exchange rates. The terms of the transaction included additional contingent consideration tied to the level of yields for the 10-year Taiwanese Government bond for two years after the signing of the transaction and was measured at fair value each period, resulting in the receipt of the maximum contractual amount of $100 million in 2022. In March 2021, PIIH completed the sale of Pramerica SGR (Italy Investment JV), to UBI Banca for cash consideration of approximately €427 million, equal to approximately $503 million. 2. OTHER INVESTMENTS Prudential Financial’s other investments as of December 31, 2023 and 2022 consisted primarily of highly liquid debt investments and intercompany enterprise liquidity account funds. 3. DEBT A summary of Prudential Financial’s short- and long-term debt is as follows:
|  |  |  |  | December 31,
| Maturity Dates |  | Rate(1) |  | 2023 |  | 2022
|  |  |  |  | ($ in millions)
Short-term debt: |  |  |  |  |  |  |
Commercial paper(2) |  |  |  |  | $ | 25 |  |  | $ | 25 |
Current portion of long-term debt |  |  |  |  | 0 |  | 0
Total short-term debt |  |  |  |  | $ | 25 |  |  | $ | 25 |
Long-term debt: |  |  |  |  |  |  |
Fixed rate senior notes | 2026-2051 |  | 1.50%-6.63% |  | $ | 10,112 |  |  | $ | 10,115 |
Junior subordinated notes | 2044-2062 |  | 3.70%-6.75% |  | 8,050 |  |  | 9,047 |
Total long-term debt |  |  |  |  | $ | 18,162 |  |  | $ | 19,162 |
__________ (1)Ranges of interest rates are for the year ended December 31, 2023. (2)The weighted average interest rate on outstanding commercial paper was 5.35% and 4.35% at December 31, 2023 and December 31, 2022, respectively. Long-term Debt In order to manage exposure to interest rate movements, Prudential Financial utilizes derivative instruments, primarily interest rate swaps, in conjunction with some of its debt issuances. The impact of these derivative instruments is not reflected in the rates presented in the table above. Interest expense was $0.0 million for the years ended December 31, 2023, 2022 and 2021, as there were no such derivatives that qualified for hedge accounting treatment. Schedule of Long-term Debt Maturities The following table presents Prudential Financial’s contractual maturities for long-term debt as of December 31, 2023:
| Calendar Year |  |
| 2025 |  | 2026 |  | 2027 |  | 2028 |  | 2028 and thereafter |  | Total
| (in millions)
Long-term debt | $ | 0 |  |  | $ | 500 |  |  | $ | 0 |  |  | $ | 390 |  |  | $ | 17,272 |  |  | $ | 18,162 |
DIVIDENDS AND RETURNS OF CAPITAL For the years ended December 31, Prudential Financial received cash dividends and/or returns of capital from the following subsidiaries:
|  | 2023 |  | 2022 |  | 2021
|  | (in millions)
Prudential Annuities Holding Company |  | $ | 18 |  |  | $ | 74 |  |  | $ | 73 |
International Insurance and Investments Holding Companies(1) |  | 216 |  |  | 1,313 |  |  | 838 |
The Prudential Insurance Company of America(2) |  | 3,100 |  |  | 2,400 |  |  | 1,100 |
PGIM Holding Company(1) |  | 66 |  |  | 156 |  |  | 540 |
Prudential Annuities Life Assurance Corporation(2) |  | 0 |  |  | 2,081 |  |  | 1,057 |
Other Companies(3) |  | 904 |  |  | 41 |  |  | 62 |
Total |  | $ | 4,304 |  |  | $ | 6,065 |  |  | $ | 3,670 |
__________ (1)2021 includes $450 million of net proceeds from the sale of Pramerica SGR (Italy Investment JV) and $198 million of net proceeds from the sale of POT that were distributed to PFI. (2)2022 includes $2,400 million of net proceeds from the sale of PRIAC and $2,081 million of net proceeds from the sale of PALAC that were distributed to PFI. (3)2023 includes $900 million dividends and returns of capital from a rabbi trust. 5. COMMITMENTS AND GUARANTEES Prudential Financial has issued a subordinated guarantee covering a subsidiary’s domestic commercial paper program. As of December 31, 2023, there was $514 million outstanding under this commercial paper program. Prudential Financial has provided guarantees of the payment of principal and interest on intercompany loans between affiliates. As of December 31, 2023, Prudential Financial had issued guarantees of outstanding loans totaling $4.9 billion between international insurance subsidiaries and other affiliates. In 2013, Prudential Financial entered into a $500 million indemnity and guarantee agreement with Wells Fargo Bank Northwest, N.A. Under this agreement, Prudential Financial guaranteed obligations with respect to an affiliated loan from PICA to an affiliate. The loan proceeds were utilized to construct the Prudential Tower home office in Newark, New Jersey. Prudential Financial is also subject to other financial guarantees, net worth maintenance agreements and indemnity arrangements, including those made in the normal course of business guaranteeing the performance of, or representations made by, Prudential Financial subsidiaries. Prudential Financial has provided indemnities and guarantees related to acquisitions and dispositions, investments, debt issuances and other transactions, including those provided as part of its ongoing operations that are triggered by, among other things, breaches of representations, warranties or covenants provided by Prudential Financial or its subsidiaries. These obligations are typically subject to various time limitations, defined by the contract or by operation of law, such as statutes of limitation. In some cases, the maximum potential obligation is subject to contractual limitations, while in other cases such limitations are not specified or applicable. This includes guarantees issued on $2.3 billion of letters of credit obtained by the Lotus Reinsurance Company from a third-party financial institution, for the benefit of PICA and Pruco Life as beneficiaries, to support U.S. statutory reserve credit related to reinsurance agreements with PICA and Pruco Life. As of December 31, 2023, $2.3 billion of letters of credit have been issued to PICA and Pruco Life under the facility, and the likelihood of PICA and Pruco Life drawing upon them is remote. The guarantees are automatically renewed annually unless notice of termination is given by either party. The current value of the guarantees is estimated to be immaterial. This also includes guarantees issued on $1.5 billion of standby committed letters of credit and $0.5 billion of standby uncommitted letters of credit obtained by Prismic Re from third party financial institutions, for the benefit of PICA as beneficiary, to support U.S. statutory reserve credit related to a reinsurance agreement with PICA. As of December 31, 2023, no letters of credit have been issued to PICA under the facility, and the likelihood of PICA drawing upon them is remote. The guarantees are renewable on an annual basis. The current value of the guarantees is estimated to be immaterial.

X
- References No definition available. + Details
Name: | srt_CondensedFinancialInformationOfParentCompanyOnlyDisclosureAbstract
Namespace Prefix: | srt_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for condensed financial information, including the financial position, cash flows, and the results of operations of the registrant (parent company) as of the same dates or for the same periods for which audited consolidated financial statements are being presented. Alternatively, the details of this disclosure can be reported by the specific parent company taxonomy elements, indicating the appropriate date and period contexts in an instance document. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 3 -Subparagraph (SX 210.12-04(a)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-3 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 205 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 6 -Subparagraph (SX 210.5-04(Schedule I)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480922/205-10-S99-6 Reference 3: http://www.xbrl.org/2003/role/recommendedDisclosureRef -Topic 810 -SubTopic 10 -Name Accounting Standards Codification -Section 45 -Paragraph 11 -Publisher FASB -URI https://asc.fasb.org//1943274/2147481231/810-10-45-11 + Details
Name: | us-gaap_CondensedFinancialInformationOfParentCompanyOnlyDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration