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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)
 
20232022
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 assets2,237 2,495 
Total investments3,648 4,084 
Cash and cash equivalents971 1,396 
Due from subsidiaries2,377 2,841 
Loans receivable from subsidiaries7,448 8,032 
Investment in subsidiaries(1)
38,519 41,390 
Property, plant and equipment404 413 
Income taxes receivable682 0 
Other assets315 116 
TOTAL ASSETS$54,364 $58,272 
LIABILITIES AND EQUITY
LIABILITIES
Due to subsidiaries$3,166 $3,705 
Loans payable to subsidiaries4,602 4,279 
Short-term debt25 25 
Long-term debt18,162 19,162 
Income taxes payable100 71 
Other liabilities489 437 
Total liabilities26,544 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 capital25,746 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 equity27,820 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)
 
202320222021
REVENUES
Net investment income$345 $177 $62 
Realized investment gains (losses), net(4)128 90 
Affiliated interest revenue408 387 358 
Other income (loss)14 27 18 
Total revenues763 719 528 
EXPENSES
General and administrative expenses173 71 166 
Interest expense1,282 1,161 1,088 
Total expenses1,455 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)
202320222021
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, net4 (128)(90)
Dividends received from subsidiaries3,705 3,967 3,239 
Property, plant and equipment(15)(8)(4)
Change in:
Due to/from subsidiaries, net212 681 (513)
Other, operating(487)39 63 
Cash flows from (used in) operating activities2,879 4,172 2,099 
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from the sale/maturity of:
Fixed maturities, available-for-sale372 76 969 
Short-term investments19,196 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 subsidiaries599 2,098 430 
Loans to subsidiaries, net of maturities584 (157)151 
Other, investing007
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 options126 163 200 
Proceeds from the issuance of debt (maturities longer than 90 days)4952,474 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 subsidiaries1,256 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 YEAR1,396 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 debt00
Total short-term debt$25 $25 
Long-term debt:
Fixed rate senior notes2026-2051
1.50%-6.63%
$10,112 $10,115 
Junior subordinated notes2044-2062
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 
 20252026202720282028 and thereafterTotal
 (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:
 
202320222021
 (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.