Finance and Capital Management
From a customer to the With-Profits Fund perspective
Withdrawals and the Shareholder Transfer (SHT)
Single withdrawal
Customer withdrawing 100% of funds in year 10
Net investment returns
of £480 by year 10
120
600
480
1,000
Annual Charges are paid
to the With-Profits Fund
and include the cost of
the SHT¹
1,000
Initial
investment
Assumed gross
returns 3
Assumed
charges 4
Withdrawal at
year-10
With-Profits income and expenses6
Illustrative5
PruFund fees
Shareholders
receive a transfer
from the WPF²
of 480/9= c. £53
Wrapper fees
Guarantee fees
(if any, not included
in this example)
With-Profits With-Profits
Income Expenses
With-Profits surplus
Shareholder Transfer
Paid by the With-Profits Fund
upon customer withdrawal
Distribution and
Admin costs
Investment
management costs
Smoothing and
holding account
1. Shareholder Transfer; 2. With-Profits Fund; 3. Based on 5% Expected Growth Rate and assuming no Unit Price Adjustments; 4. Based on 1% Annual Charge (including both fund and wrapper fees); 5. For simplicity, the charts assume EGR of 5% and Annual Charges of 1% remaining unaltered over the
entirety of the holding period with no Unit Price Adjustments; 6. With-Profits income and expenses shown on a present value basis; 7. This could be a surplus or deficit depending on how actual experience compares to that used in pricing new business, which is effected in accordance with FCA requirements 47View entire presentation