IFRS 17 Impact and OPAT Analysis

Net Profit and Shareholders' Equity Less Volatile Going Forward Illustrative Net Profit and Shareholders' Equity Under IFRS 17 OPAT Short-term market fluctuations (1) Other non-operating items Net Profit Shareholders' Allocated Equity 1 1 2 2 Non-par business (3) and surplus assets only Mark-to-market on equities and real estate - Discount rate changes on insurance contract liabilities (unit-linked with significant protection benefits) ■ Par business mark-to-market allowed for within CSM ■ Realised capital gains/losses on FVOCI bonds ■ Mark-to-market movement on FVTPL bonds ■ Provision for Expected Credit Losses (ECL) ■ Other non-operating expenses AIA 3 Other Comprehensive Income (OCI) (2) 3 Non-par business (3) and surplus assets only Mark-to-market movement on FVOCI bonds under fair value reserve Shareholders' Equity - Discount rate changes on insurance contract liabilities (other than unit-linked with significant protection benefits) under insurance finance reserve Notes: (1) (2) (3) Short-term investment and discount rate variances OCI represents fair value reserve and insurance finance reserve Non-participating (non-par) business includes all insurance liabilities under the GMM model, covering traditional protection, unit-linked with significant protection benefits, universal life and other participating business without distinct portfolios 25 45

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