#1Prudential PRUDENTIAL FINANCIAL, INC. TOKYO INVESTOR DAY SEPTEMBER 15, 2016#2Prudential PRUDENTIAL FINANCIAL, INC. TOKYO INVESTOR DAY MARK FINKELSTEIN SENIOR VICE PRESIDENT INVESTOR RELATIONS#3FORWARD-LOOKING STATEMENTS AND NON-GAAP MEASURE Certain of the statements included in this presentation constitute forward-looking statements within the meaning of the U. S. Private Securities Litigation Reform Act of 1995. Words such as "expects," "believes," "anticipates," "includes,” “plans,” “assumes,” “estimates,” “projects," "intends," "should," "will," "shall," or variations of such words are generally part of forward-looking statements. Forward-looking statements are made based on management's current expectations and beliefs concerning future developments and their potential effects upon Prudential Financial, Inc. and its subsidiaries. There can be no assurance that future developments affecting Prudential Financial, Inc. and its subsidiaries will be those anticipated by management. These forward-looking statements are not a guarantee of future performance and involve risks and uncertainties. Certain important factors that could cause actual results to differ, possibly materially, from expectations or estimates reflected in such forward-looking statements can be found in the "Risk Factors" section included in Prudential Financial, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2015. Prudential Financial, Inc. does not intend, and is under no obligation, to update any particular forward-looking statement included in this presentation. This presentation also includes references to "adjusted operating income" and return on equity, which is based on adjusted operating income. Adjusted operating income is a measure of performance that is not calculated based on accounting principles generally accepted in the United States of America (GAAP). For additional information about adjusted operating income and the comparable GAAP measure, including a reconciliation between the two, please refer to our Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, which are available on our Web site at www.investor.prudential.com. A reconciliation is also included as part of this presentation. In this presentation annualized new business premiums may be presented on a constant currency basis. For historical annualized new business premiums, refer to the foregoing reports. Prudential Financial, Inc. of the United States is not affiliated with Prudential PLC which is headquartered in the United Kingdom. Prudential Tokyo Investor Day 9.15.2016 3#4RECONCILIATIONS BETWEEN ADJUSTED OPERATING INCOME AND THE COMPARABLE GAAP MEASURE ($ millions) After-tax adjusted operating income (AOI) (1) Reconciling items: Realized investment gains (losses), net, and related charges and adjustments Investment gains (losses) on trading account assets supporting insurance liabilities, net Change in experience-rated contractholder liabilities due to asset value changes Divested businesses: Year to Date 2011 2012 2013 2014 2015 2Q15 2Q16 $ 2,917 $ 3,019 $ 4,586 $ 4,355 $ 4,649 $ 2,648 $ 1,826 847 223 (2,809) 610 (8,149) (250) (4,130) 1,579 1,337 698 339 (524) (137) 324 (123) (540) 227 (294) 433 37 (263) Closed Block division 58 30 (105) Other divested businesses 90 (615) 29 167 (66) (34) 20 Equity in earnings of operating joint ventures and earnings attributable to noncontrolling interests Total reconciling items, before income taxes (227) (29) 28 44 58 58 17 810 (3,383) (8,115) (3,874) 1,538 1,291 691 Income taxes, not applicable to adjusted operating income 424 (816) (2,857) (1,082) 490 440 243 Total reconciling items, after income taxes 386 (2,567) (5,258) (2,792) 1,048 851 448 Income (loss) from continuing operations (after-tax) before equity in earnings of operating joint ventures 3,303 452 (672) 1,563 5,697 3,499 2,274 Equity in earnings of operating joint ventures, net of taxes and earnings attributable to noncontrolling interests Income (loss) from continuing operations attributable to Prudential Financial, Inc. 148 10 (48) (41) (55) (57) (17) 3,451 462 (720) 1,522 5,642 3,442 2,257 Earnings attributable to noncontrolling interests 34 50 107 57 70 63 37 Income (loss) from continuing operations (after-tax) 3,485 512 (613) 1,579 5,712 3,505 2,294 Income from discontinued operations, net of taxes Net income (loss) Less: Income attributable to noncontrolling interests Net income (loss) attributable to Prudential Financial, Inc. 35 17 7 11 3,520 34 529 $ 3,486 $ 50 479 $ (606) 107 (713) $ 1,590 57 1,533 $ 5,712 70 5,642 $ 3,505 2,294 63 37 3,442 $ 2,257 1) Represents results of the former Financial Services Businesses for periods prior to 2015. Prudential Tokyo Investor Day 9.15.2016 4#5RECONCILIATION FOR INTERNATIONAL INSURANCE PRE-TAX AOI EXCLUDING MARKET DRIVEN AND DISCRETE ITEMS (1) ($ millions) International Insurance pre-tax AOI Reconciling items: Annual review of actuarial assumptions and reserve refinements (2) Gains on sales of indirect investment in China Pacific Group Impact of earthquake in Japan Star/Edison integration costs Sub-total International Insurance pre-tax AOI excluding market driven and discrete items Year to Date 2Q16 3,226 $ 1,582 2011 2012 2013 2014 2015 $ 2,263 $ 2,704 $ 3,152 $ 3,252 $ 237 280 20 60 (190) 66 (95) (21) (69) (213) (138) (28) (45) (58) (152) (95) (21) 22 ཆེ, (72) (72) $ 2,308 $ 2,762 $ 3,304 $ 3,347 $ 3,247 $ 1,654 1) 2) As disclosed in company earnings releases. Includes refinements of reserves and amortization of deferred policy acquisition and other costs. Prudential Tokyo Investor Day 9.15.2016 5 LO#6Prudential PRUDENTIAL FINANCIAL, INC. 2016 TOKYO INVESTOR DAY CHARLES F. LOWREY EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER INTERNATIONAL BUSINESSES#7FOUR STRATEGIC IMPERATIVES FOR PII Prudential Superior Execution in Existing Business PII Strategy Product Development to Meet Customer Needs Distribution Expansion in Proprietary and Third Party Channels Complementing Organic Growth with M&A Tokyo Investor Day 9.15.2016 2#8HISTORY OF GROWTH Sustained earnings growth despite market challenges, including declining interest rates International Insurance Pre-tax AOI (1) ($ billions) $3.2 $3.3 $3.2 $2.7 $2.3 $1.9 $1.3 $1.4 $1.4 $1.6 $1.7 $0.6 $0.8 $0.8 $0.9 $0.2 $0.3 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 JGB 10Y 2.5 2.0 1.5 1.0 0.5 0.0 www 1) Adjusted operating income (AOI) not adjusted for market driven and discrete items. Prudential www Tokyo Investor Day 9.15.2016 3#9• ● BUSINESS DEVELOPMENT OUTSIDE JAPAN Strategic approach Selective markets with attractive growth opportunities, good fit for our proven business models Prudent evaluation of prospective returns Annualized New Business ($ millions) Premiums Outside Japan (1) $500 $250 394 320 444 Recent Highlights Brazil •Life Planner insurance business modeled on successful Japanese operation • • Needs-based selling concepts Early signs of success: surpassed 1,100 Life Planner count(2), strong sales productivity and retention Chile Acquisition of 40% stake in AFP Habitat in March 2016 expands footprint in Latin America • #2 ranked mandatory pension administrator in attractive market • Lowest fees among top players, supported by efficient cost structure 50 $0 2013 2014 2015 1) Foreign denominated activity translated to U.S. dollars at uniform exchange rates for all periods presented. Excludes annualized new business premiums of joint ventures. 2) As of 6/30/16. Prudential Tokyo Investor Day 9.15.2016 4#10HIGH RETURN BUSINESS International Insurance operations generate sustainable high ROE Star & Edison Acquisition ROE (1) 21% 20% 19% 18% 17% 2011 2012 2013 2014 2015 1) Return on equity (ROE) based on after-tax AOI using the effective tax rate applicable to Prudential's overall adjusted operating income for 2015 and that of the former Financial Services Businesses for earlier periods. Based on average attributed equity excluding accumulated other comprehensive income and adjusted to remove the impact of foreign currency exchange rate remeasurement. Prudential Tokyo Investor Day 9.15.2016 5#11JAPAN REMAINS A HIGHLY ATTRACTIVE MARKET FOR PRUDENTIAL ➤ High returns driven by mortality and expense margins ➤ History of growth across economic landscapes through distribution expansion, selective acquisitions and operating efficiencies. ➤ Strong cash flow from Japanese operations; historically redeployed excess capital of more than 60% of after-tax AOI since 2009(1) ➤ Positioned to navigate increasingly challenging environment Significant product and distribution actions, including product discontinuations, pricing adjustments and commission reductions Impact of sustained low interest rates on returns emerges over a multi-year time frame Opportunities to mitigate interest rate impacts through extending asset durations and leveraging PGIM's sourcing capabilities. 1) Through 2015. Prudential Tokyo Investor Day 9.15.2016 09#12JAPAN DEMOGRAPHIC CHANGE . DRIVES GROWTH OPPORTUNITIES FOR PRUDENTIAL Retirement income needs Intergenerational wealth transfer needs We have an experienced agent force poised for steady growth that can help customers meet their evolving needs Funding of health care expenses Japan Demographics (1) Population (in millions) 9% 12% 17% 23% 28% 31% 34% 67% 69% 68% 64% 65 and over ■15-64 years old 59% 57% 54% ■0-14 years old 24% 19% 15% 13% 13% 12% 12% 1980 1990 2000 2010 2020 2030 2040 116 122 126 127 125 120 114 1) Source: United Nations: World Population Prospects, 2015. Prudential Tokyo Investor Day 9.15.2016 7#13GROWTH OPPORTUNITIES AND CHALLENGES Opportunities ⚫ Distribution expansion • Growth in Life Planner count ⚫ Life Consultant force stabilized, positioned for growth ⚫ Further development of complementary third-party channels Retirement and estate planning Multi-currency products Challenges • Terminated sales of certain savings- oriented yen products Repricing actions on yen-based protection products • Discount rate changes and new mortality tables could necessitate further actions Prudential Tokyo Investor Day 9.15.2016 8#14Prudential JAPANESE INSURANCE OPERATIONS MITSUO KURASHIGE CHIEF EXECUTIVE OFFICER JAPAN LIFE INSURANCE OPERATIONS H#15DESPITE CURRENT ENVIRONMENT, JAPAN REMAINS AN ATTRACTIVE MARKET • Opportunities Differentiated business model facilitates higher margins • Expanding distribution • . - Life Planner growth - Life Consultant count stabilized, poised for growth - Selective growth in third party channels Multi-currency products Retirement/ estate planning market driven by aging population Ongoing need for death protection products Challenges Historically low / negative interest rates impact investment margins • Current environment necessitates product and pricing actions, limiting availability and impacting attractiveness to customers • Impact of discount rate changes and new mortality tables Long-term demographics • Continued investment in infrastructure and systems • Potential growing competition in third party channels Prudential Tokyo Investor Day 9.15.2016 2#16PRODUCT ACTIONS IN 2016 • Reduced guaranteed interest rates and commissions on single premium yen products Subsequently discontinued sales of all general account single premium yen products • Reduced crediting rates on yen-based advanced premiums, suspended acceptance of advanced premiums on some products • Expanded U.S. dollar product portfolio including: - - Gibraltar low cash value USD whole life product emphasizing death protection coverage Expansion of sales of 15 year USD Multi-Currency Whole Life product to Gibraltar New USD products for both Gibraltar and POJ in development with release expected in late 2016 and early 2017 Prudential Tokyo Investor Day 9.15.2016 3#17ROE OF JAPANESE BUSINESS REMAINS HIGHLY ATTRACTIVE (1) 30% 25% 20% 20% 15% 10% 5% 24% 23% 21% 11 Strong ROE prospects even if current macro environment challenges continue 0% 2012 2013 2014 2015 1) Return on Equity (ROE) represents estimates for Japanese Insurance operations on a stand-alone basis after allocation of Division level costs. ROE is based on after-tax adjusted operating income (AOI) excluding market driven and discrete items and reflects an overall effective tax rate for Prudential's ongoing operations for 2015 and former Financial Services Businesses for earlier periods. The average attributed equity excludes accumulated other comprehensive income and is adjusted to remove the impact of foreign currency exchange rate remeasurement. Prudential Tokyo Investor Day 9.15.2016 4#18FOCUS ON DEATH PROTECTION PRODUCTS CONTRIBUTES TO MARGIN STABILITY Annualized New Business Premiums (1) (2) Annualized Premiums In Force (1) (3) Savings (4) 16% Savings (4) 17% Retirement 19% Death Protection 59% Retirement 20% Death Protection 52% A&H 6% A&H 11% Strong mortality and expense margins Excellent persistency • Limited customer behavior risk 1) Japan only. Foreign denominated activity translated to U.S. dollars at uniform exchange rate; including Japanese yen 106 per U.S. dollar. U.S. dollar denominated activity is included based on the amounts as transacted in U.S. dollars. 2) For the year ended 12/31/15. 3) 4) As of 12/31/15. Annualized premiums in force, including paid-up policies and 10% of single premium. Percentages approximate. Savings includes annuities and yen-based bank channel single premium whole life. Sales of yen-based bank channel single premium whole life were discontinued in 2013. Prudential Tokyo Investor Day 9.15.2016 5#19INCREASED DEMAND FOR MULTI-CURRENCY PRODUCTS Annualized New Business Premiums (1) 2011 53% 39% U.S. Dollar Yen denominated denominated 8% Other currencies, substantially all Australian dollar First Half 2016 47% 48% Yen denominated U.S. Dollar denominated 5% Other currencies, substantially all Australian dollar 1) Japan only. Foreign denominated activity translated to U.S. dollars at uniform exchange rate; including Japanese yen 106 per U.S. dollar. U.S. dollar denominated activity is included based on the amounts as transacted in U.S. dollars. Prudential Tokyo Investor Day 9.15.2016 00 6#20HISTORY OF GROWTH IN JAPAN Face Amount of Individual Policies in Force (1)(2) ($ billions) 700 600 647 616 630 602 582 500 400 300 200 100 0 2011 2012 2013 2014 2015 1) At end of period. Foreign denominated activity translated to U.S. dollars at uniform exchange rates for all periods presented, including Japanese yen 106 per U.S. dollar. 2) Includes Prudential of Japan and Gibraltar Life and Other operations. Prudential Tokyo Investor Day 9.15.2016 7#21LEADING POSITION IN ATTRACTIVE MARKET Prudential is a leading life insurer in Japan Ranking Category New business face amount Rank (1) Market Share (2) #2 10.5% Annualized new business premiums #5 5.9% In force face amount #5 7.5% • Premium income #6 5.5% • Total assets #6 4.2% 1) Source: Life Insurance Association of Japan, Insurance Business in 2014. Twelve months ended March 31, 2015. 2) Market share data is based on Prudential estimates developed from publicly available data of Japanese insurance companies; Prudential's premium income was adjusted down for internal reinsurance transactions. Prudential Tokyo Investor Day 9.15.2016 8#22TARGETED DISTRIBUTION SERVING THE JAPANESE MARKET POJ Life Prudential Planners • GIB Gibraltar ジブラルタ生命 Life Consultants PGF PGF生命 Prudential プルデンシャルジブラルタ ファイナンシャル生命 Prudential • Affluent and mass affluent consumers Business and professional market • . Independent Agency Channel Bank Channel . Tokyo Investor Day 9.15.2016 Mass middle market Affinity group relationships Business and professional market Bank clients with investable wealth, under-served protection needs 9#23PRODUCTIVITY (1) OF DISTRIBUTION CHANNELS 6+ • Prudential of Japan Life Planners ~3-4 . Gibraltar Life Consultants 1) Average policies sold per agent, per month, over multiple years. Prudential Tokyo Investor Day 9.15.2016 10#24QUALITY PEOPLE • Industry leading Million Dollar Round Table memberships Prudential of Japan has the highest number of MDRT members in the Japanese industry for 19 consecutive years(1) The Premier Association of MDRT Final Professionals ~ One Third of all 2 MDRT members in Japan are from POJ and Gibraltar(1) 1043 731 MDRT Japan Membership (1) 467 376 218 176 179 POJ Sony Gibraltar Metlife Tokyo Mrine Meiji-Yasuda & Nichido Dai-ichi 1) Source: Million Dollar Round Table Association, Japan - membership data as of April 1, 2016. Total membership 4,417. Prudential Tokyo Investor Day 9.15.2016 11#25THIRD PARTY DISTRIBUTION CHANNELS Advantages • Enhances access to expanded customer base and investable wealth • • Expands access to estate planning market Growth potential through development of distribution relationships Differentiated needs-based sales approach Competitive product portfolio meets customer needs Strong brand name attracts security focused customers Leverages infrastructure costs Challenges • Sales can be volatile due to changes in interest rates and competitor actions Less influence over distribution Profitability can vary with changes in product mix Manage to bottom line, not top line - accept sales volatility • Aggressive product and pricing actions Balance profitability and business mix Prudential Tokyo Investor Day 9.15.2016 12#26SUMMARY • Adapting proactively to current market environment • Strong margins sustainable with differentiated model and focus on sound asset/liability management Growth opportunities through expanding distribution, leveraging product capabilities, and lifetime customer relationships Prudential Tokyo Investor Day 9.15.2016 13#27Prudential PRUDENTIAL OF JAPAN SHOICHIRO ICHITANI PRESIDENT AND CHIEF EXECUTIVE OFFICER PRUDENTIAL OF JAPAN#28PRUDENTIAL OF JAPAN Differentiated Business Model Drives Sustained Track Record of Success and Strong Prospects ➤ Strong sales and in force growth over three decades Steady growth in Life Planner count driven by solid selective recruitment and strong retention ➤ Superior Life Planner productivity ➤ Focus on needs-based selling of death protection products, operating efficiencies, and effective asset/liability management produces strong persistency and differentiated margins. ➤ Continuing growth opportunities Prudential Tokyo Investor Day 9.15.2016 2#29DECADES OF SUSTAINED IN FORCE GROWTH (\billions) 35,000 Prudential of Japan In Force Face Amount (1) 30,000 25,000 20,000 20 year CAGR: 9% 15,000 10,000 5,000 0 10 year CAGR: 4% 1987 1988 1989 1990 1991 1992 T 7 1993 1994 7 1995 1996 1997 7 1998 1) As of March 31 (fiscal year end for Japanese statutory reporting); in-force face amount for U.S. dollar business is translated at spot rate at end of each fiscal year. Prudential Tokyo Investor Day 9.15.2016 3 1999 2000 2001 7 2002 2003 7 2004 7 2005 2006 2007 7 2008 2009 2010 2011 7 2012 2013 > 2014 2015#30PRUDENTIAL OF JAPAN SALES TRACK RECORD DRIVEN BY GROWTH IN DEATH PROTECTION PRODUCTS ($ millions) $1,200 $1,000 $800 682 $600 $400 $200 Annualized New Business Premiums (1) 835 714 737 702 Accident & Health Retirement (2) 18% CAGR Death Protection $- 2011 2012 2013 2014 2015 1) Foreign denominated activity translated to U.S. dollars at uniform exchange rates for all periods presented, Japanese yen 106 per U.S. dollar. 2) Includes insignificant amount of savings products. Prudential Tokyo Investor Day 9.15.2016 4#31KEY DRIVERS 2011 2012 2013 2014 2015 Number of Life Planners (1) 3,137 3,216 3,258 3,328 3,528 Annualized Premium Productivity (2) $18,469 $22,468 $18,617 $18,285 $18,308 Policy Count Productivity (3) 6+ 1) As of end of each year. 2) Annualized new business premiums per month for each Prudential of Japan (POJ) Life Planner; foreign denominated activity translated to U.S. dollars at uniform exchange rates for all periods presented, Japanese yen 106 per U.S. dollar. 3) Number of policies sold per POJ Life Planner, per month; includes accident and health policies. Prudential Tokyo Investor Day 9.15.2016 LO 5#32STEADY GROWTH ACROSS MARKETS ($ billions) $6.0 Prudential of Japan Insurance Revenues (1) (2) 8% CAGR 5.1 4.7 4.2 3.9 3.7 $3.0 3.5 3.3 3.0 2.8 $0.0 2005 2006 2007 2008 2009 2010 2011 2012 2013 5.4 2014 5.8 2015 1) Net premiums, policy charges and fee income; foreign denominated activity translated to U.S. dollars at uniform exchange rates for all periods presented, including Japanese yen 106 per U.S. dollar. 2) Amounts for 2006 and 2005 are calculated based on estimated currency breakdowns. Prudential Tokyo Investor Day 9.15.2016 Co#33LIFE PLANNER MODEL SUSTAINABLE COMPETITIVE ADVANTAGE DRIVEN BY DISTRIBUTION Providing financial security over customers' lifetime drives our beneficial cycle High Life Planner Productivity Quality Quality Quality People Products Service Quality Referrals High Income Productivity (1) $18,308 AP per LP month 6+ policies per LP month (2) for Life Planner High Policy Persistency (1) Persistency' 95.3% High Customer Satisfaction High Life Planner Retention Superior Returns & Steady Growth Retention (1) 85.4% 1) Data based on 2015 POJ. Annualized new business premiums (AP) produced by each Life Planner in a month; foreign denominated activity translated to U.S. dollars at uniform exchange rate, Japanese yen 106 per U.S. dollar. Productivity represents number of new policies sold per Life Planner per month, including accident and health policies. Retention for Life Planners remaining at end of period hired 12 months earlier, rolling average for 2015. 13 month policy persistency measured based on face amount, 12 month rolling average data for 2015. 2) For each of the five years ended December 31, 2015. Prudential Tokyo Investor Day 9.15.2016 7#34RECOGNIZED LEADER IN QUALITY SERVICE Prudential of Japan consistently earns highest customer satisfaction rankings according to J.D. Power (1) • Satisfied customers drive high policy persistency 2012 2013 2014 2015 2016 Customer Satisfaction (1) < Contract > #1 #1 #1 #3 #2 Customer Satisfaction (2) #1 1) < Claim > Customer Satisfaction (3) < Conservation > POJ Policy Persistency (4) Life Support Insurance segment 2012 - 2014 and All segment 2015 - 2016 of J.D. Power Asia Pacific Japan Life Insurance Contract Customer Satisfaction Studies SM Contract Customer Satisfaction Study based on life insurance policyholders who purchased or renewed coverage during the past year. http://japan.jdpower.com 2) Medical benefit segment 2012 - 2014 and All segment 2015 - 2016 of J.D. Power Asia Pacific Japan Life Insurance Contract Customer Satisfaction Studies SM 3) 4) . All segment of J.D. Power Asia Pacific Japan Life Insurance Contract Customer Satisfaction Studies SM; survey commencing 2016 targeting customers who purchased their policies over 2 years ago, or those who have not renewed or made a claim within the past year. http://japan.jdpower.com 13 month policy persistency measured based on face amount. Rolling average of 12 months experience ending at December 31, 2012 - 2015. Prudential Tokyo Investor Day 9.15.2016 8 #1 #2 #1 #1 #1 95% 95% 95% 95% 95% (as of June 30)#35CONTINUING GROWTH OPPORTUNITIES Continued growth in Life Planner count - - Solid, selective recruiting by growing sales manager force Highly attractive career for entrepreneurial professionals approximately 3 of 100 applicants accepted High agent retention rates Lifetime relationships promote "Second Sales" - - Evolving needs as client moves through life cycle Life Planner offers age / status appropriate solutions as trusted adviser Retirement and estate planning opportunities Life Planners experienced in offering U.S. dollar products, with growing market demand; recurring premium emphasis Prudential Tokyo Investor Day 9.15.2016 6#36QUALITY PRODUCTS MEETING FINANCIAL SECURITY NEEDS OVER A LIFETIME High Net Worth Market Business Insurance Market Individual Insurance Market Age Prudential Death Protection 20's-40's Owner Employee Benefit Program Funding Planning for Post-Retirement 50's-60's+ Second Sale Opportunities. Tokyo Investor Day 9.15.2016 Sophisticated Estate Planning Business Succession Family Distribution of Inheritances Nursing, Medical Care 10#37LIFETIME CLIENT RELATIONSHIPS DRIVE SUBSEQUENT SALES OPPORTUNITIES ($ millions) 200 180 160 133 Annualized New Business Premiums (1) POJ Subsequent Sales to Existing Customers 175 147 130 163 Experienced Agent Profile Number of Average Average Number Relationship of Length Clients Life Planners with 15+ years experience 783 433 10.3 years 140 110 120 106 96 100 80 60 40 20 0 2009 2010 2011 2012 2013 2014 2015 2016 First Half Retirement Accident & Health Death Protection 1) Data based on Prudential of Japan sales to individual market; foreign denominated activity translated to U.S. dollars at uniform exchange rates; Japanese yen 106 per U.S. dollar. Prudential Tokyo Investor Day 9.15.2016 11#38IN FORCE GROWTH SENSITIVITY Prudential of Japan In Force Face Amount (\ billions) 60,000 40,000 20,000 0 12/31/15 Flat in force at 36% below 2015 COBSS▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬ sales level 18% Increase 8% Increase 7% Decrease Assumed Annual Sales Level 50% below 2015 level 36% below 2015 level 20% below 2015 level At 2015 level Pro Forma 12/31/2020 (1) 1) Assuming same sales mix, currency exchange rates for non-yen business including Japanese yen 113 per U.S. dollar, persistency and other assumptions as year ended December 31, 2015. Represents impact of sales levels for years subsequent to 2015, held constant through 2020, at indicated levels in relation to annual 2015 sales, upon resulting year end 2020 in force amount. Prudential Tokyo Investor Day 9.15.2016 12#39NAVIGATING THE CURRENT ENVIRONMENT • Focus on recurring premium death protection products with returns primarily driven by mortality and expense margins • Increased sales of U.S. dollar products • Product actions - - Suspended sales of single premium yen products, effective April 2016 Reduced crediting rates for advance premiums on yen business, to be effective November 2016 Strong asset/liability management reduces reinvestment requirements, mitigating impact of spread compression on margins Prudential Tokyo Investor Day 9.15.2016 13#40SUMMARY • • Superior Life Planner Productivity • Strong Agent Retention • Life Planner Growth Through Steady and Selective Recruitment High Policy Persistency Superior Returns and Steady Growth • Effective Product and ALM Strategies Prudential Tokyo Investor Day 9.15.2016 14#41Prudential GIBRALTAR LIFE KAZUHIRO YAMAUCHI PRESIDENT AND CHIEF EXECUTIVE OFFICER GIBRALTAR LIFE H#421) GIBRALTAR LIFE Solid Return In Force Business with Broad Distribution Reach ➤ Effective acquisition model with well integrated businesses provides stable block of highly profitable business ➤ Life Consultant count stabilized following Star / Edison acquisition and integration; positioned for growth ➤ Distinctive affinity distribution through long-standing relationship with Japanese Teachers Association ➤ Additive Independent Agency distribution focused on protection products Broader focus on protection, U.S. dollar and other non-yen products, and strong asset-liability management mitigates impact of current low interest rate environment ➤ Active management of product offerings to maintain appropriate returns: suspended sales of yen-based fixed annuities, single premium whole life (1) Certain products suspended February 2016, others July 2016. Prudential Tokyo Investor Day 9.15.2016 2#43GIBRALTAR LIFE OVERVIEW • Consolidated Gibraltar Life Gibraltar Life Distribution Life Consultant(1) Channel Independent Agency Channel PGFL (2) Distribution Bank Channel 2012 Merger 2009 Rehabilitation AIG Star AIG Edison 2001 Rehabilitation Kyoei 1) Formal name is "Life Plan Consultant". 2) Prudential Gibraltar Financial Life. Prudential Yamato Tokyo Investor Day 9.15.2016 3#44DISTRIBUTION CHANNEL STRATEGY Distribution Life Consultant Channel Common Basic Strategy Independent Agency Channel Needs-based selling focusing on death protection Upper middle-market Middle-market Customer Segment Affinity groups Death protection Primary Customer Needs Retirement Business and professional market Death protection Retirement Business planning Whole life & Term Whole life & Term Product Solution USD Whole life & Retirement income USD Whole life & Retirement income Prudential Accident & Health Multi-currency fixed annuities Accident & Health Multi-currency fixed annuities Tokyo Investor Day 9.15.2016 4#45CHANNEL PRODUCT MIX 2015 Sales (1)(2) $918 million 2015 Number of Policies In Force (3) 6.5 million 27% 73% Life Consultants 6% 94% Independent Agencies 1) Annualized new business premiums; excluding Bank Channel. 2) Foreign denominated activity translated to U.S. dollars at uniform exchange rate; Japanese yen 106 per U.S. dollar. 3) As of end of period; excluding Bank Channel. Prudential Tokyo Investor Day 9.15.2016 LO 5#46LIFE CONSULTANT COUNT(1) STABILIZED POST STAR/EDISON ACQUISITION AND POSITIONED FOR GROWTH 14,000 12,000 12,791 10,000 8,000 8,805 8,734 6,000 6,121 6,281 4,000 2,000 0 T 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 May 2016 Kyoei acquired April 2001; implemented Prudential Business Model 1) At end of period. Prudential Tokyo Investor Day 9.15.2016 Star/Edison integration Positioned for Growth co#47LIFE CONSULTANT DISTRIBUTION - BROAD MARKET COVERAGE WITH ACCESS TO NEARLY ALL OF JAPANESE POPULATION . . • Branch offices established in substantially all prefectures Prudential training supports emphasis on death protection products and needs-based selling Serving expanding need for retirement income security products. • Teachers Association and other affinity group relationships provide recurring sources of new business 1) As of July 1, 2016. Prudential Tokyo Investor Day 9.15.2016 Osaka area Tokyo area 83 branch offices supporting Life Consultants (1) 7#48LIFE CONSULTANT CHANNEL KEY DRIVER - TEACHERS MARKET • Teachers market remains a primary and stable source of business for Gibraltar • Approximately one-quarter of Life Consultant channel new business is derived from this market ⚫ Perennial source of sales through teacher career spans - Protection products to entering and active teachers - Retirement products for lump-sum recipients 2015 Annualized New Business Premiums (1) ■Teachers Market Other Life Consultant Sales 73% 27% 1) Foreign denominated activity translated to U.S. dollars at uniform exchange rates; Japanese yen 106 per U.S. dollar. Prudential Tokyo Investor Day 9.15.2016 8#49LIFE CONSULTANT CHANNEL KEY DRIVER - TEACHERS MARKET Japanese Educational Mutual Aid Association of Welfare Foundation • 公益財団法人 日本教育公務員弘済会 Approximately 5,000 Life Consultants (1) SERVING Relationship since 1952 Membership eligibility: Public school teachers and support employees Approximately 35,000 Public schools nationwide (2) Approximately 950,000 Public school teachers nationwide (2) 1) As of January 1, 2016. 2) As of May 1, 2015, Source: Japan Ministry of Education, Culture, Sports, Science and Technology, and Japanese Educational Mutual Aid Association of Welfare Foundation. Includes support employees of public schools. Prudential Tokyo Investor Day 9.15.2016 6#50INDEPENDENT AGENCY CHANNEL A DIFFERENTIATED STRATEGY Key strategies Focus on "Quality" not just top-line growth; price competition not key to winning sales • Deeper relationships with fewer agencies post Star/Edison integration • Strong partnership with high performing agencies Key success factors • Develop highly-motivated agencies and producers who subscribe to our business. approach Develop and train qualified marketing representatives to work with agencies Number of Active Producers (monthly average) 2,000 1,500 1,000 166 500 Number of MR/SR(1) 250 200 209 236 0 2013 Number of MR/SR 2014 1) MR: Marketing Representatives providing face to face support for agencies, mainly in metropolitan areas. SR: Sales Representatives providing non-face to face support to agencies mainly in remote areas. Prudential Tokyo Investor Day 9.15.2016 2015 150 100 Number of Active Producers (monthly average) 10#51SUCCESSFUL DISTRIBUTION CHANNEL DEVELOPMENT STRATEGIES Annualized New Business Premiums (1) ($ millions) $800 Life Consultants $700 $600 $500 $400 $300 $200 $100 $0 ($ millions) Independent Agency $400 $350 $300 $250 $200 $150 $100 $50 $0 2010 2011 2012 2013 2014 2015 Star Edison acquisition added over 4,000 Independent Agency relationships Independent Agency model rationalized with deeper relationships and fewer agencies 2,643 Independent Agency relationships at May 31, 2016 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Steady growth through 2010 reflects successful rehabilitation of Kyoei, following April 2001 acquisition Sales jump in 2011 reflects addition of ~7,000 agents from February acquisition of Star / Edison. Subsequent decline reflects sales force rationalization. Integration of Star / Edison substantially complete in 2013 Achieved more efficient operations platform; productivity returned to pre-acquisition levels by 2014(2) • 1) Foreign denominated activity translated to U.S. dollars at uniform exchange rates; Japanese yen 106 per U.S. dollar. 2) Average policies sold per Life Consultant, per month. Prudential Tokyo Investor Day 9.15.2016 11#52EMPHASIS ON PROTECTION PRODUCTS Annualized New Business Premiums First Half 2016(1) Life Consultants $375 million Fixed Annuities (substantially all non-yen) 28% Death Protection 50% Retirement 15% A&H 7% Independent Agency $127 million Fixed Annuities (substantially all non-yen) 17% Retirement 24% A&H 10% 1) Foreign denominated activity translated to U.S. dollars at uniform exchange rates; Japanese yen 106 per U.S. dollar. Prudential Tokyo Investor Day 9.15.2016 Death Protection 49% 12#53IN FORCE GROWTH SENSITIVITY Gibraltar Life In Force Face Amount (1) (\billions) 40,000 30,000 20,000 12/31/15 Assumed Annual Sales Level 20% below 2015 level 7% below 2015 level At 2015 level 4% Increase 6% Decrease Pro Forma 12/31/2020(2) Flat in force at 7% below 2015 sales level 13% Increase 20% above 2015 level 1) Excludes Bank channel. 2) Assuming same sales mix, currency exchange rates for non-yen business, and persistency as year ended December 31, 2015. Represents impact of sales levels for years subsequent to 2015, held constant through 2020, at indicated levels in relation to actual 2015 sales, upon resulting year end 2020 in force amount. Prudential Tokyo Investor Day 9.15.2016 13#54PRODUCTIVITY Life Consultant 2011 2012 2013 2014 2015 Number of Life Consultants (1) 12,791 11,333 9,327 8,707 8,805 Annualized Premium Productivity (2) $5,637 $5,403 $6,072 $6,413 $6,605 Policy Count Productivity (3) 3.5 3.1 3.6 3.6 3.8 Independent Agency 2011 2012 2013 2014 2015 Number of Independent Agencies (1) 3,393 2,646 2,517 2,598 Number of Active Producers 1,126 1,088 1,595 (monthly average) 1,573 1) As of end of each year; 2011 independent agency data and producer count is not meaningful due to the initial phase of the Star / Edison integration. 2) Annualized new business premiums per month for each Gibraltar Life Consultant; foreign denominated activity translated to U.S. dollars at uniform exchange rates for all periods presented, Japanese yen 106 per U.S. dollar. 3) Number of policies sold per agent, per month; includes accident and health policies. Prudential Tokyo Investor Day 9.15.2016 14#55• SUMMARY Solid earnings base from stable block of high quality business with strong persistency • Successful proprietary distribution concepts adapted from Life Planner model to support protection product emphasis in middle-market across Japan • Broad national distribution coverage with opportunities for growth through long-term steady building of Life Consultant count and increased penetration in chosen agencies • Product strategies and strong asset/liability management mitigate impact of challenging environment Prudential Continued Strong Prospects for Solid Margins, Returns and Growth Tokyo Investor Day 9.15.2016 15#56Prudential BANCASSURANCE IN JAPAN TAKESHI SOEDA PRESIDENT AND CHIEF EXECUTIVE OFFICER PRUDENTIAL GIBRALTAR FINANCIAL LIFE H#57BANCASSURANCE IN JAPAN Proven Differentiated Approach to Japanese Bank Distribution Drives Growth of High Quality Business Emphasizing Mortality-Based Margins ➤ Focus on death protection products; recurring premium emphasis ➤ "Seconded" Life Planners and skilled wholesalers enhance value proposition and sales quality ➤ Broad suite of non-yen products emphasizing U.S. dollar life insurance attractive to bank customers with substantial deposit funds ➤ Active management of product offerings, pricing and cost structure to maintain appropriate expected returns Prudential Tokyo Investor Day 9.15.2016 2#58BANCASSURANCE MARKET IN JAPAN . • Concentration of Japanese household financial assets among age 50+ population with substantial bank balances High volume of maturing annuity contracts, in addition to trillions of dollars of fixed deposits held by bank customers, are developing an attractive sales opportunity for life insurance business Substantial Wealth Concentration among Banks' Primary Customers Demographic Structure of Japan (1) (Total population: 127 million) Household financial assets (2) ($15.9 trillion) Aged 50 years old and over Aged less than 50 years old 58 million (46%) 69 million (54%) $13.5 trillion (85%) Banks' main customers $ 2.4 trillion (15%) 1) Source: "Population Estimates (as of December 1, 2015)" released by the Statistics Bureau of the Ministry of Internal Affairs and Communications. 2) Compiled by Prudential based on the balance as of the end of September in Bank of Japan's "the data on Flow of Funds Accounts" (preliminary report) (for the 3rd quarter in 2015) and "Family Income and Expenditure Survey (from July to September in 2015)" by the Statistics Bureau of the Ministry of Internal Affairs and Communications. Japanese yen translated to U.S. dollars at 106 yen per U.S. dollar. Prudential Tokyo Investor Day 9.15.2016 3#591) 2) 3) BANK CHANNEL RELATIONSHIPS PROVIDE BROAD NATIONAL COVERAGE Established Distribution Relationships with all of Japan's Mega Banks and Major Trust Banks (7 Banks in Total) Prudential Distribution Partners(1)(2) Deposits, etc(3) (Trillion USD) Mega Bank(4) 4 $3.2 Major Trust 3 $1.5 Bank Regional bank, 67 $2.0 etc. Brokerage firm 1 $1.0 Total 75 $7.7 As of December 1, 2015. The number of banks/financial institutions in which Prudential products are offered. As of September 30, 2015. Based on data published by institutions. Translated at Japanese yen 106 per U.S. dollar. 4) Includes Resona Bank. Prudential Tokyo Investor Day 9.15.2016 4#60COMPREHENSIVE PRODUCT PORTFOLIO EMPHASIZES PROTECTION PRODUCTS Bank Channel Product Portfolio (1) Annuity Whole Life Retirement Term Cancer Whole life insurance Yen, USD Single pay fixed annuities (2) Increasing whole life insurance Yen USD, AUD Single pay whole life insurance USD, AUD Family income insurance Yen Retirement income insurance Level term insurance Yen Whole life cancer insurance USD Yen Increasing term insurance Yen Protection Products Savings Products 1) Product portfolio as of June 30, 2016. 2) U.S. Dollar variable annuities also available in portfolio; insignificant sales. Prudential Tokyo Investor Day 9.15.2016 LO 5#61BANK CHANNEL SALES FOCUSED ON RECURRING PREMIUM PROTECTION AND NON-YEN PRODUCTS Annualized New Business Premiums (1) Year ended December 31, 2015 First Half 2016 1) $701 million Yen-Based Products 31% U.S. Dollar and Other Non-Yen Products 69% Yen - Recurring Premium death Protection Yen - Other products USD - Recurring Premium death Protection USD - Other products I Multi-currency - Other products $376 million Yen-Based Products 22% U.S. Dollar and Other Non-Yen Products 78% Foreign denominated activity translated to U.S. dollars of uniform exchange rates for all periods presented; Japanese yen 106 per U.S. dollar. Prudential Tokyo Investor Day 9.15.2016 co 6#62INTERGENERATIONAL WEALTH TRANSFER DRIVES ENHANCED BANK CHANNEL OPPORTUNITY • Inheritance tax system revisions effective January 1, 2015 subjects more people to inheritance tax payments and increased rates • Gift tax rates lowered to encourage wealth transfer during lifetime • We believe Japanese consumers place high confidence in banks for these estate planning elements • Life insurance products offer attractive inheritance solutions Percentage of People Subject to Inheritance Tax Payment Gift Tax Filings (3) (in thousands) 500 489 470 After the tax 439 As of 2014(1) law revision (2) (January, 2015) 391 400 379 345 National 4.4% Average nearly 6% 289 300 273 Tokyo 7.5% nearly 20% 200 2008 2009 2010 2011 2012 2013 2014 2015 National Tax Agency "State of inheritance tax return for 2014" and Tokyo Regional Taxation Bureau "State of inheritance tax return for 2014." 2) Survey by Legacy, tax accounting firm, published in 2013. National Tax Agency, the Taxation System for Settlement at the Time of Inheritance is excluded. Prudential Tokyo Investor Day 9.15.2016 7#63BANK CHANNEL SALES SUPPORT PRUDENTIAL'S DIFFERENTIATED APPROACH With more than 8 years since Japan's full deregulation of Bancassurance in 2007, Prudential has secured substantial marketing expertise and skilled human resources to serve the Bank Channel Sales Role Headcount(1) personnel Wholesaler Provide sales support to bank employees ~130 Experienced former Life Planners: Insurance Consultant (secondment) 1) As of June 30, 2016. 2) At certain banks. Prudential • Sell insurance products at banks where "seconded" •Provide training to bank employees ~240(2) Tokyo Investor Day 9.15.2016 8#64PRUDENTIAL'S INSURANCE CONSULTANT "SECONDMENT" MODEL Experienced Life Planners "seconded" as Insurance Consultants to partner with banks, directly bringing strength of Prudential's distribution model to bank channel (1) - - Key Role of Insurance Consultant - • Sell insurance policies directly to bank customers •Train bank employees, including needs-based selling principles, so that they can independently conduct sales focused on death protection products Seconded Insurance Consultant Count Growth of Insurance Consultant - Secondment Model 250 200 150 100 50 lll 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 1) At certain banks; count data at the end of period. Prudential Tokyo Investor Day 9.15.2016 6#65BANK CHANNEL GROWTH DRIVEN BY DEATH PROTECTION PRODUCTS ($ millions) $1,200 Bank Channel Annualized New Business Premiums (1) 1,132 $1,000 $800 $600 501 $400 699 605 701 376 Hili $200 14% CAGR $0 2011 2012 2013 2014 2015 First Half 2016 Savings Accident & Health Retirement Death Protection 1) Foreign denominated activity translated to U.S. dollars at uniform exchange rates for all periods presented, Japanese yen 106 per U.S. dollar. Prudential Tokyo Investor Day 9.15.2016 10#66ACTIVE PRODUCT MANAGEMENT IN THE CURRENT ENVIRONMENT • Suspended sales of yen-based single premium products, early 2016 Reduced crediting rates for advance premiums on yen business, effective June 2016 Suspended acceptance of full year advance premiums on yen-based increasing whole life, effective June 2016 Increased sales of U.S. dollar products Prudential Tokyo Investor Day 9.15.2016 11#67SUMMARY • • • • Japan bancasssurance offers attractive customer base, wealth concentration Unique bank channel approach applying Prudential's differentiated capabilities Focus on death protection coverage, emphasizing recurring premium products and U.S. dollar business Intergenerational wealth transfer market enhances opportunity set Active product management in the current environment Continued Strong Prospects for Growth of Mortality Based Business with Attractive Returns Prudential Tokyo Investor Day 9.15.2016 12#68Prudential INVESTMENTS AND ASSET-Liability MANAGEMENT IN JAPAN SCOTT SLEYSTER SENIOR VICE PRESIDENT AND CHIEF INVESTMENT OFFICER PRUDENTIAL FINANCIAL, INC.#69MEETING INVESTMENT CHALLENGES IN JAPANESE MACRO ENVIRONMENT Backdrop: Decades-long decline in Japanese interest rates • Negative rates on certain benchmark Japanese government bonds follow Japan monetary stimulus strategies • Limited availability of attractive long-dated Yen fixed income investments Positioning Strong ALM focus • Multi-currency business significantly reduces reliance on Yen-denominated investments Pace and mix of reinvestment flows reduce impact of current market conditions ⚫ Diversified high quality investment portfolio • Products emphasize mortality and expense margins • • Strategies and Opportunities Leverage Prudential's global asset management capabilities Increased emphasis on U.S. dollar products Selective use of non-coupon asset classes to support long-dated liabilities Modest level of investment in U.S. dollar assets hedged to Yen Longer maturity Yen investments; not investing at negative yields Additional capacity to enhance yield through credit allocation Prudential Tokyo Investor Day 9.15.2016 2#70STRONG ASSET/LIABILITY MANAGEMENT DISCIPLINE Disciplined ALM approach mitigates risks, including the impact of changes. in interest rates • • • Globally Consistent Approach Domestic and International investment organizations share common ALM approach, framework and tools - Liability driven foundation for portfolio construction Deep understanding of liabilities Asset/Liability Management teams are strongly aligned with businesses Well matched in investible space . • • . Japan ALM Positioning Long-duration assets are held to support insurance liabilities Key rate duration positions targeted to tolerance band Interest rate risk position managed by currency Strong ALM focus with tight asset and liability management in most liquid investable space (~30 years) Prudential Tokyo Investor Day 9.15.2016 3#71INVESTMENT PORTFOLIO DIVERSIFIED BY CURRENCY, SUPPORTING MULTI-CURRENCY PRODUCT OFFERINGS Japan business is diversified by currency, reducing reliance on Yen investments. New and recurring cash flows denominated in USD, JPY and AUD Liabilities are supported by assets denominated in or hedged to same currency, or part of overall equity hedging program. Invested Assets (1) (2) $167 billion Reserves (1)(3) $138 billion 1) As of June 30, 2016. Other $10 (4) JPY (5) $107 USD $50 Yen Equity Hedge Program (USD) Other $10 (4) USD $32 JPY $96 2) Invested assets presented on a U.S. GAAP carrying value basis. Includes a net unrealized gain of $31 billion and excludes cash & equivalents of $4 billion. 3) Insurance liability balances represent future policy benefits and policyholder account balances on a U.S. GAAP basis. 4) Primarily Australian dollar. 5) Includes approximately $5 billion of USD assets hedged to Yen. Prudential Tokyo Investor Day 9.15.2016 4#72PACE AND MIX OF REINVESTMENT FLOWS REDUCE IMPACT OF CURRENT MARKET CONDITIONS Investments Supporting Japanese Yen Liability Portfolio: $97.1 billion (1)(2) ($ billions) Estimated Weighted Amortized Cost Average Annual (in USD)(2)(3) Average Runoff 2016-2018 (4) Book Yield (5) Prudential of Japan $33.2 $0.5 2.5% JPY Assets $28.1 $0.1 USD Assets $5.1 $0.4 Gibraltar Life $63.9 $1.9 2.4% JPY Assets $56.3 $1.4 USD Assets $7.6 $0.5 1) As of June 30, 2016. Portfolio based on currency of underlying products. 72375 2) 3) 4) Based on amortized cost using exchange rate of JPY106 per USD. JPY assets include $4.5 billion of USD investments hedged to Yen; USD assets represent $12.7 billion held in conjunction with the Yen Equity Hedge Program. Includes scheduled maturities and estimated prepayments. 5) Weighted average yield calculated based on net investment income divided by average AUM related to Yen denominated liabilities. Prudential LO 5#73PACE AND MIX OF REINVESTMENT FLOWS REDUCE IMPACT OF CURRENT MARKET CONDITIONS Investments Supporting U.S. Dollar Liability Portfolio: $32.5 billion (1) (2) ($ billions) Amortized Cost (3) Estimated Average Annual Weighted Average Runoff 2016-2018(4) Book Yield (5) Prudential of Japan $11.3 $0.5 5.3% Gibraltar Life $21.2 $1.3 4.2% 1) As of June 30, 2016. Portfolio based on currency of underlying products. 2) 3) 72375 Based on amortized cost. Excludes $4.5 billion of USD investments hedged to Yen and $12.7 billion of USD assets held in conjunction with the Yen Equity Hedge Program. 4) Includes scheduled maturities and estimated prepayments. 5) Weighted average yield calculated based on net investment income divided by average AUM related to USD denominated liabilities. Prudential co#74U.S. DOLLAR INVESTMENTS DEPLOYED TO SUPPORT LIABILITIES AND AS PART OF THE YEN EQUITY HEDGE PROGRAM U.S. Dollar investments exceed similarly denominated liabilities by approximately $17.2 billion - Of this amount - $12.7 billion supports the Yen Equity Hedge Program and $4.5 billion is hedged to JPY to support JPY denominated liabilities U.S. Dollar Invested Assets: $50 billion (1)(2) ($ billions) Supports USD Liabilities $32.5 Single Premium MVA Annuities (3) $10.4 Yen Equity Hedge Program $12.7 Other USD Business $22.1 Based on amortized cost. 1) As of June 30, 2016. 2) 3) Contracts subject to Market Value Adjustments in event of premature surrender. Prudential Hedged to Yen $4.5 7#75MANAGEABLE EXPOSURE TO INVESTMENT OF NET INSURANCE CASH FLOWS Annual Net Insurance Cash Flows (1) ($ billions) Japanese Yen (2) $5.3 U.S. Dollar $2.3 Australian Dollar(2) $2.0 1) For the year ended December 31, 2015, represents premiums, policy charges and fees and investment income, less policy benefits and expenses, on in-force and new business. Excludes investment portfolio maturities, prepayments and sales, derivative settlements and capital transactions. 2) Presented in USD based on average currency exchange rates. Prudential 8#76JAPAN MORE FULLY LEVERAGING PRUDENTIAL'S GLOBAL ASSET MANAGEMENT CAPABILITIES Japan portfolios take advantage of Prudential's global asset management and private asset origination capabilities Prudential Fixed Income PGIM Prudential Capital Group PGIM Real Estate Prudential Mortgage Capital Company Prudential Tokyo Investor Day 9.15.2016 9#77• • DIVERSIFIED AND HIGH QUALITY ASSET PORTFOLIO (1) Asset The Japan investment portfolio holds 95% investment grade fixed income - The investment grade credit portfolio is high quality - 69% rated 'A' and above Risk assets represent only 5% of the portfolio 3% in Below Investment Grade 2% in Non-Coupon Investments Including Equities Governments and Agencies Inv. Grade Public Fixed Income Inv. Grade Private Portfolio Asset Class (2) Investment Grade Credit Rating Distribution (2)(3) (47% of Total Portfolio) 40% 31% Placements 48% ■Commercial Mortgages Below Investment Grade Non-Coupon Investments Including Equities 8% 8% 2% / 3% 29% AA and Above A 31% BBB Includes fixed maturities, commercial mortgages and other loans, and non-coupon investments including equities. 1) 2) As of June 30, 2016 based on amortized cost. 3) Includes public investment grade fixed income, private placements and commercial mortgages. Based on ratings assigned by nationally recognized rating agencies, or rating equivalents, or internally assigned ratings. Prudential Tokyo Investor Day 9.15.2016 10#78• • 2016 YTD ASSET PURCHASES Higher proportion of acquisitions in credit assets compared to existing portfolio Significant acquisitions in attractive asset classes such as commercial mortgages and private placements - These efforts leverage PGIM sourcing capabilities Fixed Income Acquisitions 2016 YTD: $11.5 billion (1)(2) JGBs Inv. Grade Public Fixed Income I Inv. Grade Private Placements I Commercial Mortgages 37% Below Investment Grade AUD Government & Related US Treasuries 10% Private Placements & Mortgages: 23% of 2016 YTD purchases 13% 4% 4% 9% UST Yield: 212 bps 23% As of June 30, 2016 based on U.S. GAAP carrying value and book yield by currency of invested assets. Converted to USD based on weighted average exchange rates. 2) Prudential Tokyo Investor Day 9.15.2016 JGB Yield: 58 bps 11#79ADDITIONAL CAPACITY FOR CREDIT ALLOCATIONS IN JAPAN Japan portfolios have additional capacity for credit risk, which could be utilized to further enhance Net Investment Income (NII) - The ultimate size of this credit position would take capital and risk implications into account PFI (ex. Closed Block Division & Japan Operations) Fixed Maturities: Credit vs. Government Bonds (1) Japan Operations Portfolio Fixed Maturities: Credit vs. Government Bonds (1) 88% 12% Credit Government 50% 50% 1) As of June 30, 2016 based on amortized cost. Credit includes public investment grade bonds, private placements, commercial mortgages, mortgage backed securities, structured products, below investment grade fixed income. Government bonds include government and agency fixed income. Prudential Tokyo Investor Day 9.15.2016 12#80CONCLUSION Strong ALM focus coupled with product portfolio currency mix and emphasis on mortality and expense margins limits exposure of overall returns to Yen investment yields Pace and mix of reinvestment flows reduce impact of current market conditions Diversified high quality investment portfolio Leveraging Prudential's strong global asset management capabilities Additional capacity to enhance yield by increased allocation to credit Prudential Tokyo Investor Day 9.15.2016 13#81Prudential PRUDENTIAL International INSURANCE FINANCIAL OVERVIEW ROB FALZON EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER PRUDENTIAL FINANCIAL, INC. H#82'THE BALANCING ACT' - OPERATING METRIC OBJECTIVES Prudential Growth and Return Cash Generation on Equity and Deployment Volatility and Risk ... All underpinned by balance sheet strength and stability Tokyo Investor Day 9.15.2016 2#83HIGH RETURN BUSINESS International Insurance Historical Earnings (1) & ROE (2) Capital Redeployed Total Earnings less Capital Redeployed Earnings (1) ($ billions) 25.5% 26.6% ROE 24.3% 22.0% 20.4% 19.4% 16.6% 17.9% 18.7% $2.4 $2.4 $2.3 $2.0 $1.7 $1.4 $1.2 $1.2 $1.0 2007 2008 2009 2010 2011 2012 2013 2014 2015 Avg. JPY/USD FX Rate: Avg. JGB 10 Yr: 118 103 94 88 80 80 98 1.68% 1.49% 1.35% 1.18% 1.12% 0.86% 0.71% 106 0.55% 121 0.36% Ann. Nikkei % A: (-1%) (-42%) +19% (-3%) (-17%) +23% +57% +7% +9% 1) Not adjusted for market driven and discrete items. Represents after-tax results based on pre-tax AOI tax effected using the overall effective tax rate of PFI for 2015 and the former FSB for periods prior to 2015. 2) Return on equity (ROE) based on after-tax AOI using an overall effective rate for Prudential Financial, Inc. (PFI) for 2015 and for the former Financial Services Businesses (FSB) for periods prior to 2015, based on average attributed equity excluding accumulated other comprehensive income and adjusted to remove the impact of foreign currency exchange rate remeasurement. Prudential Tokyo Investor Day 9.15.2016 3#84RETURNS PRIMARILY DERIVED FROM MORTALITY & EXPENSE MARGINS Investment Margin Mortality, Expense & Other Margin International Insurance Source of Earnings (1) Accident & Health Term Life Recurring Pay Whole Life Retirement Income Single Pay Whole Life Fixed Annuity Protection Oriented Retirement / Savings Oriented 1) Conceptual illustration based on typical individual products with assumed profitability structure at time of sale; not intended to depict precise allocation of earnings sources. Prudential Tokyo Investor Day 9.15.2016#85KEY MITIGANTS FOR INTEREST RATE EXPOSURE • Interest rates have been low in Japan for many years 8% 7% 10 Year JGB 10 Year UST 6% 5% 4% 3% 2% 1% 0% -1% 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 (1) Key Mitigants • • Low portfolio turnover Strong asset/liability management, including investment asset classes supported by PGIM skills Emphasis on protection products - stable earnings from mortality and expense margins ⚫ Pivot to greater emphasis on U.S. dollar products Reprice new business when appropriate to maintain margins Fixed annuity products designed to mitigate interest rate risk (i.e., bi-weekly repricing for new business, market value adjustments) 1) Through July 31. Prudential Tokyo Investor Day 9.15.2016 LO 5#86HYPOTHETICAL IMPACT OF INTEREST RATES ON EARNINGS ASSUMING RATES STAY AT 6/30/16 LEVELS ($ millions) Estimated Negative Impact of Flat Rates on International Insurance Pre-tax AOI (1) $(45) 2017 $(130) 2018 $(200) 2019 Cumulative annual impact if rates stay at current levels through 2019 is modest, ~(200) million pre-tax 1) Assumes profit drivers including mortality, persistency, expenses, and other assumptions, and mix of investments purchased, consistent with our base projection, with yields unchanged from June 30, 2016. Impact only from pro-forma investment income decline; excludes potential impact of U.S. GAAP unlockings of deferred policy acquisition costs and related items. Prudential Tokyo Investor Day 9.15.2016 Co#87STATUTORY RESERVING INTEREST RATES • RECENT DEVELOPMENTS IN JAPAN • Standard reserve rates driven by formulas prescribed by the Financial Services Agency (FSA) Applicable only to new business for Yen-denominated products commencing at effective dates Standard rate reduced from 75bps to 25bps for Single Pay Whole Life in July 2016 Standard rate expected to change for Recurring Premium Whole Life effective April 2017, with 75bps reduction likely Adaptive actions - Sales suspensions - Product repricings - Greater emphasis on U.S. dollar products Prudential Tokyo Investor Day 9.15.2016 7#88FOREIGN CURRENCY EXCHANGE RATE HEDGING OBJECTIVES • Dampen Annual Reported Earnings Volatility due to Foreign Currency Exchange Rates . Protect Enterprise Earnings and ROE Protect Long-term Value of Investment in Japanese Business Mitigate Currency Exchange Rate Impact on Solvency Margin Ratio (SMR) Prudential Tokyo Investor Day 9.15.2016 8#89CURRENCY SENSITIVITY During the first half of 2016, approximately 34% of International Insurance earnings are yen-based International Insurance First Half 2016 Earnings at Different Yen Hedging Rates(1) ($ millions) Actual Rate 1,754 1,676 1,614 1,582 1,520 1,484 1,453 min Hypothetical \80 \90 ¥100 ¥106 ¥120 ¥130 ¥140 Hedging Rates Difference from Actual Hedging (25%) (15%) (6%) 0% 13% 23% 32% Rate Pro Forma Impact to AOI 11% 6% 2% 0% (4%) (6%) (8%) 1) Based on actual and alternative assumed hedging rates for Japanese yen income to U.S. dollars. Prudential Tokyo Investor Day 9.15.2016 9#90YEN HEDGING STRATEGY - MITIGATES ROE DILUTION Hedge Type $15.4B Protection Income Hedges $1.8B Forwards Protects Near-term Earnings and Cash Flow 2016 Plan Rate ¥106/$ Equity Hedges $12.8B USD Assets Protects Long-term Value $0.8B Existing Hedges as of 6/30/2016 Dual Currency Bonds First Half 2016 Cash Settlements (1) $294M 6/30/2016 Fair Value (1)(2) $(522)M 1) 2) For Internal and External equity hedges. Break-even at June 30, 2016 is ¥107/ $. Prudential Tokyo Investor Day 9.15.2016 10#91YEN EARNINGS HEDGE Expected yen-based AOI is hedged over a 36 month rolling period using a series of FX forwards with laddered maturities • Each quarter's expected yen earnings are hedged over the preceding 9 quarters. The hedged rate is an average of these transactions. Historical Yen Spot Rates vs. Hedging Rates USD/JPY Spot Rate (1). Hedging Rate Trailing 3-Yr Rolling Avg. Spot Rate (1) 130 120 110 100 90 80 އ 70 2010 2011 2012 2013 2014 2015 2016 1) Through June 30, 2016. Prudential Tokyo Investor Day 9.15.2016 11#92• YEN EQUITY HEDGE PROTECTS USD VALUE OF JAPAN OPERATIONS AND OVERALL PRUDENTIAL ROE FROM FX MOVEMENTS U.S. dollar investments in Japan support value of Yen-based business Cash flows to/from Japan on internal hedge reflect currency movements - Provides cash to holding company over time which, on redeployment, mitigates negative impact to earnings and ROES in weakening Yen scenario Creates "Yen-denominated" assets on Japanese books, mitigating solvency margin ratio volatility that would otherwise result from owning USD assets Cash payments to / from holding company over multi-year period to help manage liquidity Future USD Value of Dividends from Japan Lower Future Dividend USD Asset Value Hedge Cash Flows -800% SMR Weakening Yen USD Assets Worth More \ Cash from Japan -800% SMR Stable Yen USD Assets Worth Same \ No Cash Movement No Change ~800% SMR Strengthening Yen USD Assets Worth Less \ Cash to Japan Higher Future Dividend Prudential Tokyo Investor Day 9.15.2016 12#93FAIR VALUE OF YEN EQUITY HEDGE (1) Equity Hedges Equity Hedge FX Sensitivity USD/JPY Rate Fair Value of Equity Hedges ($ billions) $13.6 billion "notional" value of yen exposure - - $(0.5) billion fair value of PFI hedges Cash is realized over time as settlements occur Spot Rate as of 6/30/16 10% JPY Appreciation 10% JPY Depreciation ¥103 ¥92 ¥113 (0.5) (2.0) 0.9 1) As of June 30, 2016. Prudential Maturity Profile of Equity Hedge Settlements ($ millions) -$270 2016 ~$(320) ~ $(470) 2017 2018+ Tokyo Investor Day 9.15.2016 13#94HISTORICAL CAPITAL GENERATION AND REDEPLOYMENT • Redeployed excess capital of ~65% of earnings since 2009(1) Japan returns capital to the U.S. through diverse means and in accordance with regulatory standards Historical Capital Redeployment ($ billions) $13.4 $8.6 Cumulative 2009-2015 Earnings (2) Forms of Cumulative Redeployment Acquisition Funding and Other 38% Dividends 14% Affiliate Lending 20% Debt Repayment 28% 1) Through December 31, 2015. 2) | Capital Redeployed Represents after-tax results based on pre-tax AOI tax effected using the effective tax rate of PFI for 2015 and the former FSB for periods prior to 2015. Prudential Tokyo Investor Day 9.15.2016 14#95CAPITAL MANAGEMENT OPPORTUNITIES International Insurance operations redeploy capital through various methods Redeployment Method Description Dividends Affiliated Debt Repayment • In accordance with regulatory and solvency standards • Approximately $0.9 billion outstanding on books of Prudential's Japanese insurance companies(1) Affiliated Lending • In accordance with regulatory and solvency standards . Acquisition Funding ⚫ Local capital provides potential source for acquisition financing and Other ⚫ Other opportunities consistent with regulatory standards • 1) As of March 31, 2016 translated at Japanese yen 112 per U.S. dollar. Includes amounts relating to preferred stock issues. Prudential Tokyo Investor Day 9.15.2016 15#96SOLVENCY MARGIN RATIO Solvency margin position of Prudential's Japanese insurance companies - well capitalized and financially secure SMR March 31, 2016(1) Prudential of Japan 801% Stressed Scenario Consistent with Target Gibraltar Life 928% Consistent with Target Stressed Scenario (2) . Japan Equity Down 55% • Real Estate USD & AUD Exchange Rates • Interest Rates Down 35% Strengthening 20% Up 100 bps 1) Based on Japanese statutory accounting and risk management standards applicable to regulatory filing. On a consolidated basis. Represents indicated change applied to asset valuation as of March 31, 2016. 2) Prudential Tokyo Investor Day 9.15.2016 16#97KEY MESSAGES • Product Focus Drives Return Prospects • Manageable Exposure to Macro- Environment Developments . • Robust Financial Position • Strong Capital Generation and Deployment Prudential Tokyo Investor Day 9.15.2016 17