AIA Financial Overview and ESG Commitment
Overall Positive Outcome From Adoption of IFRS 9 and 17
IFRS 9 and 17 Update
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Minimal effect on OPAT and significant uplift in net profit
■ IFRS 17 OPAT for 2022 expected to be within 5% of IFRS 4 OPAT
Net profit for 2022 expected to be at least $2b higher than IFRS 4 net profit - and less volatile going forward
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Accounting treatment of hedge derivatives for Par business aligned to underlying economics
$2b of fair value losses on hedge derivatives reported for Par business under IFRS 4 net profit are offset by the
corresponding change in liabilities under IFRS 17
Shareholders' allocated equity higher under IFRS 17 at the end of 2022
Contractual service margin (CSM) of $55b on transition (1 Jan 2022), reflecting the profitability of the in-force business
On transition (1 Jan 2022) shareholders' allocated equity is lower by 2% and shareholders' equity lower by 7%
At end 2022, shareholders' allocated equity and shareholders' equity expected to be higher under IFRS 17 than IFRS 4
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