Standard Life Aberdeen plc
Full Year Results 2019
Part 6 of 8
Insurance contracts, participating investment contracts and reinsurance contracts relate to the UK and European insurance business sold in 2018, Standard Life (Asia) Limited classified as held for sale, and insurance associates in the UK, India and China.
The measurement basis of assets and liabilities arising from life and pensions business contracts is dependent upon the classification of those contracts as either insurance or investment contracts.
Insurance contracts
A contract is classified as an insurance contract only if it transfers significant insurance risk. Insurance risk is significant if an insured event could cause an insurer to pay significant additional benefits to those payable if no insured event occurred, excluding scenarios that lack commercial substance. Our judgement is that where death benefits exceed maturity benefits by 10% or more a contract is classified as an insurance contract, by 5% or less it is not an insurance contract. There are no material contracts within the 5% to 10% range. A contract that is classified as an insurance contract remains an insurance contract until all rights and obligations are extinguished or expire.
Life and pensions business contracts that are not classified as insurance contracts are classified as investment contracts.
The Group has written insurance and investment contracts which contain discretionary participating features (e.g. with profits business). These contracts provide a contractual right to receive additional benefits as a supplement to guaranteed benefits. These additional benefits are based on the performance of with profits funds and their amount and timing is at the discretion of the Group. These contracts are referred to as participating insurance contracts if they contain a feature that transfers significant insurance risk and otherwise as participating investment contracts.
Generally, life and pensions business product classes are sufficiently homogeneous to permit a single classification at the level of the product class. However, in some cases, a product class may contain individual contracts that fall across multiple classifications (hybrid contracts). For certain significant hybrid contracts our judgement is that it is appropriate to separate the product class into the insurance element, a non-participating investment element and a participating investment element, so that each element is accounted for separately.
Where a contract contains a feature that meets the definition of both an insurance contract and a derivative, the contract is classified in its entirety as an insurance contract.
For insurance contracts and participating investment contracts, IFRS 4 Insurance Contracts permits the continued application, for income statement presentation purposes, of accounting policies that were being used at the date of transition to IFRS, except where a change is deemed to make the financial statements more relevant to the economic decision-making needs of users and no less reliable, or more reliable, and no less relevant to those needs. Therefore the Group applies accounting policies based on the Association of British Insurers Statement of Recommended Practice issued in 2005 (ABI SORP) as described below.
Premiums received on insurance contracts and participating investment contracts are recognised as revenue in the consolidated income statement when due for payment, except for unit linked premiums which are accounted for when the corresponding liabilities are recognised. For single premium business, this is the date from which the policy is effective. For regular (and recurring) premium contracts, receivables are established at the date when payments are due.
Claims paid on insurance contracts and participating investment contracts are recognised as expenses in the consolidated income statement. Maturity claims and annuities are accounted for when due for payment. Surrenders are accounted for when paid or, if earlier, on the date when the policy ceases to be included within the calculation of the insurance liability. Death claims and all other claims are accounted for when notified.
When a policyholder exercises an option within an investment contract to utilise withdrawal proceeds from the investment contract to secure future benefits which contain significant insurance risk, the related investment contract liability is derecognised and an insurance contract liability is recognised. The withdrawal proceeds which are used to secure the insurance contract are recognised as premium income.
Claims payable include the direct costs of settlement. Reinsurance recoveries are accounted for in the same period as the related claim.
The change in insurance and participating investment contract liabilities, comprising the full movement in the corresponding liabilities during the period, is recognised in the consolidated income statement. This also includes the movement in unallocated divisible surplus (UDS) in the period. However, where movements in assets and liabilities which are attributable to participating policyholders are recognised in other comprehensive income, the change in UDS arising from these movements is not recognised in the consolidated income statement as it is also recognised in other comprehensive income.
For insurance contracts and participating investment contracts, IFRS 4 Insurance Contracts permits the continued application, for measurement purposes, of accounting policies that were being used at the date of transition to IFRS, except where a change is deemed to make the financial statements more relevant to the economic decision-making needs of users and no less reliable, or more reliable, and no less relevant to those needs. Therefore the Group applies accounting policies based on the ABI SORP as described below. As was permitted under the ABI SORP, the Group adopts local regulatory valuation methods, adjusted for consistency with asset measurement policies, for the measurement of liabilities under insurance contracts and participating investment contracts issued by overseas subsidiaries and associates.
Participating contract liabilities are analysed into the following components:
�� Participating insurance contract liabilities
�� Participating investment contract liabilities
�� Present value of future profits on non-participating contracts, which is treated as a deduction from gross participating contract liabilities
�� Unallocated divisible surplus
The policy for measuring each component is noted below.
Participating contract liabilities arising under contracts issued by with profits funds which were within the scope of the Prudential Regulation Authority (PRA) realistic capital regime prior to the introduction of Solvency II are measured on the PRA realistic basis that was used in the PRA realistic capital regime. Under this approach, the value of participating insurance and participating investment contract liabilities in each with profits fund is calculated as:
�� With profits benefits reserves (WPBR) for the fund as determined under the PRA realistic basis, plus
�� Future policy related liabilities (FPRL) for the fund as determined under the PRA realistic basis, less
�� Any amounts due to equity holders included in FPRL, less
�� The portion of future profits on non-participating contracts included in FPRL not due to equity holders, where this portion can be separately identified
The WPBR is primarily based on the retrospective calculation of accumulated asset shares. The aggregate value of individual policy asset shares reflects the actual premium, expense and charge history of each policy. The net investment return credited to the asset shares is consistent with the return achieved on the assets notionally backing participating business. Any mortality deductions are based on published mortality tables adjusted where necessary for experience variations. For those asset shares on an expense basis, the allowance for expenses attributed to the asset share is, as far as practical, the appropriate share of the actual expenses incurred or charged to the fund. For those on a charges basis, the allowance is consistent with the charges for an equivalent unit linked policy. The FPRL comprises other components such as a market consistent stochastic valuation of the cost of options and guarantees.
Prior to the sale of Standard Life Assurance Limited (SLAL) to Phoenix Group Holdings Plc (Phoenix), the Group's principal with profits fund was the Heritage With Profits Fund (HWPF). The application to the HWPF of the Group's accounting policy for participating insurance and investment contract liabilities is described below. This policy for the HWPF now applies, for equity accounting purposes, to the Group's associate Phoenix.
The participating contracts held in the HWPF were issued by a with profits fund that fell within the scope of the PRA realistic capital regime. Under the Scheme of Demutualisation (the Scheme), the residual estate of the HWPF exists to meet amounts which may be charged to the HWPF under the Scheme. However, to the extent that SLAL's board is satisfied that there is an excess residual estate, it shall be distributed over time as an enhancement to final bonuses payable on the remaining eligible policies invested in the HWPF. This planned enhancement to the benefits under with profits contracts held in the HWPF is included in the FPRL under the PRA realistic basis, resulting in a realistic surplus of nil. Applying the policy noted above, this planned enhancement is therefore included within the measurement of participating contract liabilities.
The Scheme provides that certain defined cash flows (recourse cash flows) arising in the HWPF on specified blocks of UK and Ireland business, both participating and non-participating, may be transferred out of that fund when they emerge, being transferred to the Shareholder Fund (SHF) or the Proprietary Business Fund (PBF) of SLAL, and thus accrue to the ultimate benefit of equity holders of the company. Under the Scheme, such transfers are subject to certain constraints in order to protect policyholders. The Scheme also provides for additional expenses to be charged by the PBF to the HWPF in respect of Germany branch business in SLAL.
Under the PRA realistic basis, the discounted value of expected future cash flows on participating contracts not reflected in the WPBR is included in FPRL (as a reduction in FPRL where future cash flows were expected to be positive). The discounted value of expected future cash flows on non-participating contracts not reflected in the measure on non-participating liabilities is recognised as a separate asset (where future cash flows are expected to be positive). The Scheme requirement to transfer future recourse cash flows out of the HWPF is recognised as an addition to FPRL. The discounted value of expected future cash flows on non-participating contracts can be apportioned between those included in the recourse cash flows and those retained in the HWPF for the benefit of policyholders.
Applying the policy noted above:
�� The value of participating insurance and participating investment contract liabilities on the consolidated statement of financial position is reduced by future expected (net positive) cash flows arising on participating contracts
�� Future expected cash flows on non-participating contracts are not recognised as an asset of the HWPF on the consolidated statement of financial position. However, future expected cash flows on non-participating contracts that are not recourse cash flows under the Scheme are used to adjust the value of participating insurance and participating investment contract liabilities on the consolidated statement of financial position.
Some participating contract liabilities arise under contracts issued by a non-participating fund with a with profits investment element then transferred to a with profits fund within SLAL that fell within the scope of the PRA's realistic capital regime. The with profits investment element of such contracts was measured as described above. Any liability for insurance features retained in the non-participating fund was measured using the gross premium method applicable to non-participating contracts (see Section (v)).
An amount is recognised for the PVFP on non-participating contracts held in the HWPF since the determination of the realistic value of liabilities for with profits contracts in the HWPF takes account of this value. The amount is recognised as a deduction from liabilities. As this amount can be apportioned between an amount recognised in the realistic value of with profits contract liabilities and an amount recognised in UDS, the apportioned amounts are reflected in the measurement of participating contract liabilities and UDS respectively.
The UDS comprises the difference between the assets and all other recognised liabilities in with profits funds. This amount is recognised as a liability when it is not considered to be allocated to shareholders due to uncertainty regarding transfers from these funds to equity holders.
In relation to the HWPF, amounts are considered to be allocated to equity holders when they emerge as recourse cash flows within the HWPF.
As a result of the policies for measuring the HWPF's assets and all its other recognised liabilities:
�� The UDS of the HWPF comprises the value of future recourse cash flows on participating contracts (but not the value of future recourse cash flows on non-participating contracts), the value of future additional expenses to be charged on Germany branch business and the effect of any measurement differences between the Realistic Balance Sheet value and IFRS accounting policy value of all assets and all liabilities other than participating contract liabilities recognised in the HWPF
�� The recourse cash flows are recognised as they emerge as an addition to equity holders' profits if positive or as a deduction if negative. As the additional expenses are charged in respect of the Germany branch business, they are recognised as an addition to equity holders' profits.
Measurement for UK business is based on a best estimate with a margin for prudence.
The liability for annuity in payment contracts was measured by discounting the expected future annuity payments together with an appropriate estimate of future expenses at an assumed rate of interest derived from yields on the underlying assets.
Other non-participating insurance contracts are measured using the gross premium method. In general terms, a gross premium valuation basis is one in which the premiums brought into account are the full amounts receivable under the contract. The method includes explicit estimates of premiums, expected claims and costs of maintaining contracts. Cash flows are discounted at the valuation rate of interest determined to reflect conditions at the reporting date in accordance with Prudential Regulation Authority (PRA) requirements that existed at 31 December 2015.
Non-participating insurance contract liabilities are measured, for equity accounting purposes, at best estimate with an explicit margin for prudence with the process used to determine assumptions based on Solvency II data. The valuation interest rate is a risk free rate (swap curve plus 10 bps) with an explicit adjustment for illiquidity in respect of assets backing illiquid liabilities. Demographic assumptions are based on a best estimate with an explicit margin for demographic risks.
The Group's policy for measuring liabilities for non-participating insurance contracts issued by overseas subsidiaries is to apply the valuation technique used in the issuing entity's local statutory or regulatory reporting.
The Group applies a liability adequacy test at each reporting date to ensure that the insurance and participating contract liabilities (less related deferred acquisition costs) are adequate in the light of the estimated future cash flows. This test is performed by comparing the carrying value of the liability and the discounted projections of future cash flows.
If a deficiency is found in the liability (i.e. the carrying value amount of its insurance liabilities is less than the future expected cash flows), that deficiency is provided for in full. The deficiency is recognised in the consolidated income statement.
Contracts with reinsurers are assessed to determine whether they contain significant insurance risk. Contracts that did not give rise to a significant transfer of insurance risk to the reinsurer are considered financial reinsurance and are accounted for in a manner consistent with financial instruments.
Contracts that gave rise to a significant transfer of insurance risk to the reinsurer are assessed to determine whether they contained an element that did not transfer significant insurance risk and which could be measured separately from the insurance component. Where such elements are present, they are accounted for separately with any deposit element being accounted for in a manner consistent with financial instruments. The remaining elements, or where no such separate elements are identified, the entire contracts, are classified as reinsurance contracts.
Reinsurance contracts are measured using valuation techniques and assumptions that are consistent with the valuation techniques and assumptions used in measuring the underlying policy benefits and taking into account the terms of the reinsurance contract.
Reinsurance recoveries due from reinsurers and reinsurance premiums due to reinsurers under reinsurance contracts that are contractually due at the reporting date are separately recognised in receivables and other financial assets and other financial liabilities respectively unless a right of offset exists, in which case the net amount is reported on the consolidated statement of financial position.
Expenses, including interest, arising under elements of contracts with reinsurers that do not transfer significant insurance risk are recognised on an accruals basis in the consolidated income statement as expenses under arrangements with reinsurers.
(a) ��� Insurance contract premium income
| � | � | 2019 | 2018 |
| � | � | �m | �m |
| Gross earned premium | � | 67 | 75 |
| Premium ceded to reinsurers | � | (1) | (2) |
| Insurance contract premium income from continuing operations | � | 66 | 73 |
(b) ��� Insurance contract claims and change in liabilities
| � | � | 2019 | 2018 |
| � | � | �m | �m |
| Claims and benefits paid | � | 61 | 62 |
| Claim recoveries from reinsurers | � | (2) | (4) |
| Net insurance claims | � | 59 | 58 |
| Change in reinsurance assets and liabilities | � | 1 | 5 |
| Change in insurance contract liabilities | � | 96 | (62) |
| Insurance contract claims and change in liabilities from continuing operations | � | 156 | 1 |
On 1 January 2019, the Group adopted IFRS 9 Financial Instruments. Refer Basis of preparation for details of the transition from the previous financial instruments standard, IAS 39 to IFRS 9.
As the Group has not restated comparative information, the measurement of financial liabilities at 31 December 2019 is in accordance with IFRS 9 while the measurement of financial liabilities at 31 December 2018 is in accordance with IAS 39. The classification of financial liabilities under IFRS 9 is the same as under IAS 39. Only one measurement difference arose as described below.
Management determines the classification of financial liabilities at initial recognition. Financial liabilities which are managed and whose performance is evaluated on a fair value basis are designated as at fair value through profit or loss. Changes in the fair value of these financial liabilities are recognised in the consolidated income statement.
Derivatives are also measured at fair value. Changes in the fair value of derivatives are recognised in investment return in the consolidated income statement except for derivative instruments that are designated as a cash flow hedge or net investment hedge. The classification of derivatives and the accounting treatment of derivatives designated as a hedging instrument are set out in Note 20.
Other financial liabilities are classified as being subsequently measured at amortised cost. Amortised cost is calculated, and the related interest expense is recognised in the consolidated income statement, using the effective interest method.
All financial liabilities are initially recognised at fair value less, in the case of financial liabilities subsequently measured at amortised cost, transaction costs that are directly attributable to the issue of the liability.
Under IFRS 9, where the terms of a financial liability measured at amortised cost are modified and the modification does not result in the derecognition of the liability, the liability is adjusted to the net present value of the future cash flows less transaction costs with a modification gain or loss recognised in the income statement. No modification gain or loss was recognised under IAS 39.
The methods and assumptions used to determine fair value of financial liabilities measured at fair value through profit or loss and derivatives are discussed in Note 40.
The table below sets out an analysis of financial liabilities excluding unit linked financial liabilities which are set out in Note 25.
| � | � | Designated as at fair value through profit or loss | Cash flow hedge | At amortised cost | Total |
| 2019 | Notes | �m | �m | �m | �m |
| Third party interest in consolidated funds | � | 119 | - | - | 119 |
| Subordinated liabilities | 33 | - | - | 655 | 655 |
| Derivative financial liabilities | 20 | 3 | - | - | 3 |
| Other financial liabilities | 36 | 14 | - | 1,301 | 1,315 |
| Total | � | 136 | - | 1,956 | 2,092 |
�
| � | � | Designated as at fair value through profit or loss | Held for trading | Cash flow hedge | At amortised cost | Total |
| 20181 | Notes | �m | �m | �m | �m | �m |
| Third party interest in consolidated funds | � | 26 | - | - | - | 26 |
| Subordinated liabilities | 33 | - | - | - | 1,081 | 1,081 |
| Derivative financial liabilities | 20 | - | 4 | - | - | 4 |
| Other financial liabilities | 36 | 29 | - | - | 1,132 | 1,161 |
| Total | � | 55 | 4 | - | 2,213 | 2,272 |
1��� Comparatives for 2018 have been represented to exclude unit linked liabilities. Refer Note 25.
Subordinated liabilities are debt instruments issued by the Company which rank below its other obligations in the event of liquidation but above the share capital. Subordinated liabilities are initially recognised at the value of proceeds received after deduction of issue expenses. Subsequent measurement is at amortised cost using the effective interest rate method.
�
| � | � | 2019 | 20181 | ||
| � | Notes | Principal | Carrying | Principal | Carrying |
| Subordinated notes | � | � | � | � | � |
| 4.25% US Dollar fixed rate due 30 June 2028 | � | $750m | �563m | $750m | �581m |
| 5.5% Sterling fixed rate due 4 December 2042 | � | �92m | �92m | �500m | �500m |
| Total subordinated liabilities | 40 | � | �655m | � | �1,081m |
1��� The Group has initially applied IFRS 9 at 1 January 2019. Under the transition method chosen, comparative information is not restated and the cumulative effect of initially applying this standard is recognised in retained earnings at the date of initial application. Refer Basis of preparation.
On 26 March 2019, the Company repurchased 5.5% Sterling fixed rate subordinated notes with a principal amount of �408m (out of a total principal amount of �500m). The total amount paid was �462m including �7m of accrued interest and a repurchase loss of �49m has been included in restructuring and corporate transaction expenses (refer Note 9).
A description of the key features of the Group's subordinated liabilities as at 31 December 2019 is as follows:
| � | 4.25% US Dollar fixed rate1,2 (from 15 November 2018) | 4.25% US Dollar fixed rate1,2 (until 15 November 2018) | 5.5% Sterling fixed rate |
| Principal amount | $750m | $750m | �92m |
| Issue date | 18 October 2017 | 18 October 2017 | 4 December 2012 |
| Maturity date | 30 June 2028 | 30 June 2048 | 4 December 2042 |
| Callable at par at option of the Company from | Not applicable | 30 June 2028 and on every interest payment date (semi-annually) thereafter | 4 December 2022 and on every interest payment date (semi-annually) thereafter |
| If not called by the Company interest will reset to | Not applicable | 2.915% over the five-year Treasury rate (and at each fifth anniversary) | 4.85% over the five-year gilt rate (and at each fifth anniversary) |
1��� The cash flows arising from the US dollar subordinated notes give rise to foreign exchange exposure which the Group manages with a cross-currency swap designated as a cash flow hedge. Refer Note 20 for further details.
2��� During the year ended 31 December 2018, the terms of the 4.25% US Dollar fixed rate subordinated notes were renegotiated to allow the notes to qualify as regulatory capital under CRD IV (refer Note 46).
The difference between the fair value and carrying value of the subordinated liabilities is presented in Note 40. A reconciliation of movements in subordinated liabilities in the year is provided in Note 41.
The principal amount of all the subordinated liabilities is expected to be settled after more than 12 months. The accrued interest on the subordinated liabilities of �nil (2018: �2m) is expected to be settled within 12 months.
During the year to 31 December 2018, the Group redeemed/repurchased subordinated liabilities with the following key features:
| � | 7% US Dollar fixed rate | 6.75% Sterling fixed rate | 6.546% Sterling fixed rate |
| Principal amount | $500m | �500m | �300m |
| Issue date | 1 March 2013 | 12 July 2002 | 4 November 2004 |
| Maturity date | Perpetual | Perpetual | Perpetual |
| Callable at par at option of the Company from | 1 March 2018 and on any interest payment date thereafter | 12 July 2027 and on every fifth anniversary thereafter | 6 January 2020 and on every anniversary thereafter |
| If not called by the Company interest will reset to | Not applicable | 2.85% over the gross redemption yield on the appropriate five-year benchmark gilt rate | 2.7% over the gross redemption yield on the appropriate one-year benchmark gilt rate |
The 7% US Dollar fixed rate perpetual capital notes with a principal amount of $500m were redeemed on 1 March 2018.
The 6.75% Sterling fixed rate subordinated guaranteed bonds and 6.546% Sterling fixed rate Mutual Assurance Capital Securities with principal amounts of �500m and �300m respectively were redeemed on 25 October 2018. These debt instruments were classified as equity for the period from 30 August 2018 to their redemption/repurchase on 25 October 2018. Refer Note 30 for further details.
The Group operates two types of pension plans:
�� Defined benefit plans which provide pension payments upon retirement to members as defined by the plan rules. All of the Group's defined benefit plans, with the exception of a small plan in Ireland, are closed to future service accrual.
�� Defined contribution plans where the Group makes contributions to a member's pension plan but has no further payment obligations once the contributions have been paid
The Group's liabilities in relation to its defined benefit plans are valued by at least annual actuarial calculations. The Group has funded these liabilities in relation to its UK and Ireland defined benefit plans by ring-fencing assets in trustee-administered funds. The Group has further smaller defined benefit plans some of which are unfunded.
The statement of financial position reflects a net asset or net liability for each defined benefit pension plan. The liability recognised is the present value of the defined benefit obligation (estimated future cash flows are discounted using the yields on high quality corporate bonds) less the fair value of plan assets, if any. If the fair value of the plan assets exceeds the defined benefit obligation, a pension surplus is only recognised if the Group considers that it has an unconditional right to a refund of the surplus from the plan. The amount of surplus recognised will be limited by tax and expenses. Our judgement is that, in the UK, an authorised surplus tax charge is not an income tax. Consequently, the surplus is recognised net of this tax charge rather than the tax charge being included within deferred taxation.
For the principal defined benefit plan (UK Standard Life Group plan), the Group considers that it has an unconditional right to a refund of a surplus, assuming the gradual settlement of the plan liabilities over time until all members have left the plan. The plan trustees can purchase annuities to insure member benefits and can, for the majority of benefits, transfer these annuities to members. The trustees cannot unconditionally wind up the plan or use the surplus to enhance member benefits without employer consent. Our judgement is that these trustee rights do not prevent us from recognising an unconditional right to a refund and therefore a surplus.
Net interest income (if a plan is in surplus) or interest expense (if a plan is in deficit) is calculated using yields on high quality corporate bonds and recognised in the consolidated income statement. A current service cost is also recognised which represents the expected present value of the defined benefit pension entitlement earned by members in the period. A past service cost is also recognised which represents the change in the present value of the defined benefit obligation for service in prior periods, resulting from an amendment or curtailment to a plan.
Remeasurements, which include gains and losses as a result of changes in actuarial assumptions, the effect of the limit on the plan surplus and returns on plan assets (other than amounts included in net interest) are recognised in other comprehensive income in the period in which they occur. Remeasurements are not reclassified to profit or loss in subsequent periods.
For defined contribution plans, the Group pays contributions to separately administered pension plans. The Group has no further payment obligations once the contributions have been paid. The contributions are recognised in current service cost in the consolidated income statement as staff costs and other employee-related costs when they are due.
�
| Defined contribution plans |
| The defined contribution plans comprise a mixture of arrangements depending on the employing entity and other factors. Some of these plans are located within the same legal vehicles as defined benefit plans. The Group contributes a percentage of pensionable salary to each employee's plan. The contribution levels vary by employing entity and other factors. |
�
| Defined benefit plans | |
| UK plans | |
| These plans are governed by trustee boards, which comprise employer and employee nominated trustees and an independent trustee. The plans are subject to the statutory funding objective requirements of the Pensions Act 2004, which require that plans be funded to at least the level of their technical provisions (an actuarial estimate of the assets needed to provide for benefits already built-up under the plan). The trustees perform regular valuations to check that the plans meet the statutory funding objective. While the IAS 19 valuation reflects a best estimate of the financial position of the plan, the funding valuation reflects a prudent estimate. There is no material difference in how assets are measured. The funding measure of liabilities (technical provisions) and the IAS 19 measure are materially different. The key differences are the discount rate and inflation assumptions. While IAS 19 requires that the discount rate reflect corporate bond yields, the funding measure discount rate reflects a prudent estimate of future investment returns based on the actual investment strategy. The funding valuation adopts a market consistent measure of inflation without any adjustment. The IAS 19 assumption incorporates an adjustment to remove the inflation risk premium believed to exist within market prices. The trustees set the plan investment strategy to protect the ratio of plan assets to the trustees' measure of technical provisions. This investment strategy does not aim to protect the IAS 19 surplus or the ratio of plan assets to the IAS 19 measure of liabilities. After consulting the relevant employers, the trustees prepare statements of funding and investment principles and set a schedule of contributions. If necessary, this schedule includes a recovery plan that aims to restore the funding level to the level of the technical provisions. | |
| UK Standard Life Group plan (principal plan) | This is the Group's principal defined benefit plan. The plan closed to new membership in 2004 and changed from a final salary basis to a revalued career average salary basis in 2008. Accrual ceased in April 2016. The transfer of employees to Phoenix, in connection with the sale of our UK and European insurance business, caused a curtailment in this plan that reduced plan liabilities by �42m. However, a plan amendment was agreed that reduced this fall in liabilities to �18m.�These movements were recognised within past service cost in 2018, together with the associated movement in the asset ceiling. Following a High Court ruling against a third party's pension scheme, that required that scheme to address the inequalities in the statutory benefits paid to men and women, an allowance for assumed equalisation was introduced for our principal defined benefit plan at 31 December 2018. The estimated impact was recognised as a past service cost in 2018, though was not material. Changes to death-in-service benefits for UK employees, as part of a wider harmonisation of terms and conditions, has resulted in a plan amendment and associated (negative) past service cost in 2019 of �14m. The funding of the plan depends on the statutory valuation performed by the trustees, and the relevant employers, with the assistance of the scheme actuary - i.e. not the IAS 19 valuation. The funding valuation was last completed as at 31 December 2016, and measured plan assets and liabilities to be �4.9bn and �4.2bn respectively. This corresponds to a surplus of �0.7bn and funding level of 117%. As there is currently no deficit, no recovery plan is required. The funding valuation as at 31 December 2019 is currently being completed. |
| Other UK plans | The Group also operates two UK defined benefit plans as a result of the acquisition of AAM PLC in 2017. These plans are final salary based, with benefits depending on members' length of service and salary prior to retirement. At the last statutory valuation date, these plans were in deficit and the Group agreed funding plans which aimed to eliminate the deficits, with the plans' trustees. At 31 December 2019, one of the two schemes is now in surplus on an IAS 19 basis. The valuations as at 30 June 2019 are currently being finalised. |
| Other plans | |
| Ireland Standard Life plan | In December 2009 this plan closed to new membership and changed from a final salary basis to a career average revalued earnings (CARE) basis. Following the sale of the UK and European insurance business, there remains fewer than 10 employees who continue to accrue benefits under this plan. The transfer of employees to Phoenix, in connection with the sale of our UK and European insurance business, caused a curtailment in this plan that reduced plan liabilities by �4m. This movement was recognised in past service cost in 2018. At the last funding valuation, effective 1 January 2019, the plan was 72% funded on an ongoing basis. |
| Other | The Group operates smaller funded and unfunded defined benefit plans in other countries. |
The plans are administered according to local laws and regulations in each country. Responsibility for the governance of the plans rests with the relevant trustee boards (or equivalent).
The amounts recognised in the consolidated income statement for defined contribution and defined benefit plans are as follows:
| � | � | 2019 | 2018 |
| � | � | �m | �m |
| Current service cost | � | 60 | 67 |
| Past service cost | � | (13) | (15) |
| Net interest income | � | (31) | (27) |
| Administrative expenses | � | 2 | 2 |
| Expense from continuing operations recognised in the consolidated income statement | � | 18 | 27 |
Contributions made to defined contribution plans are included within current service cost, with the balance attributed to the Group's defined benefit plans.
Contributions to defined benefit plans in the year ended 31 December 2019 comprised �15m (2018: �37m) to the Other UK plans and the Ireland Standard Life plan.�Contributions are expected to remain at this level over 2020 and are not expected to change materially over the subsequent three years.�These contributions include a mixture of deficit funding and funding to achieve a targeted level of overall financial strength.
(b)���� Analysis of amounts recognised in the consolidated statement of financial position
| � | 2019 | 2018 | ||||
| � | Principal | Other | Total | Principal | Other | Total |
| � | �m | �m | �m | �m | �m | �m |
| Present value of funded obligation | (2,852) | (339) | (3,191) | (2,542) | (311) | (2,853) |
| Present value of unfunded obligation | - | (3) | (3) | - | (3) | (3) |
| Fair value of plan assets | 4,609 | 308 | 4,917 | 4,251 | 276 | 4,527 |
| Effect of limit on plan surplus | (615) | - | (615) | (598) | - | (598) |
| Net asset/(liability) | 1,142 | (34) | 1,108 | 1,111 | (38) | 1,073 |
The principal plan surplus is considered to be recoverable as a right to a refund exists. The surplus has been reduced to reflect an authorised surplus payments charge that would arise on a refund. Other includes a defined benefit plan with a surplus of �21m at 31 December 2019 (2018: �nil).
(c)���� Movement in the net defined benefit asset
| � | Present value | Fair value of | Total | Effect of limit on plan surpluses | Total |
| 2019 | �m | �m | �m | �m | �m |
| At 1 January | (2,856) | 4,527 | 1,671 | (598) | 1,073 |
| Total expense | � | � | � | � | � |
| Current service cost | (2) | - | (2) | - | (2) |
| Past service cost | 13 | - | 13 | - | 13 |
| Interest (expense)/income | (79) | 127 | 48 | (17) | 31 |
| Administrative expenses | (2) | - | (2) | - | (2) |
| Total (expense)/income recognised in consolidated income statement | (70) | 127 | 57 | (17) | 40 |
| Remeasurements | � | � | � | � | � |
| Return on plan assets, excluding amounts included in interest income | - | 385 | 385 | - | 385 |
| Gain from change in demographic assumptions | 16 | - | 16 | - | 16 |
| Loss from change in financial assumptions | (459) | - | (459) | - | (459) |
| Release of death in service obligation | 7 | - | 7 | - | 7 |
| Experience gains | 28 | - | 28 | - | 28 |
| Change in effect of limit on plan surplus | - | - | - | - | - |
| Remeasurement (losses)/gains recognised in other comprehensive income | (408) | 385 | (23) | - | (23) |
| Exchange differences | 7 | (5) | 2 | - | 2 |
| Employer contributions | - | 15 | 15 | - | 15 |
| Benefit payments | 133 | (132) | 1 | - | 1 |
| At 31 December | (3,194) | 4,917 | 1,723 | (615) | 1,108 |
�
| � | Present value | Fair value of | Total | Effect of limit on plan surpluses | Total |
| 2018 | �m | �m | �m | �m | �m |
| At 1 January | (3,193) | 4,806 | 1,613 | (592) | 1,021 |
| Reclassified as held for sale during the year | 8 | - | 8 | - | 8 |
| Total expense | � | � | � | � | � |
| Current service cost | (5) | - | (5) | 1 | (4) |
| Past service cost | 21 | - | 21 | (6) | 15 |
| Interest (expense)/income | (80) | 122 | 42 | (15) | 27 |
| Administrative expenses | (3) | - | (3) | 1 | (2) |
| Total (expense)/income recognised in consolidated income statement | (67) | 122 | 55 | (19) | 36 |
| Remeasurements | � | � | � | � | � |
| Return on plan assets, excluding amounts included in interest income | - | (253) | (253) | - | (253) |
| Gain from change in financial assumptions | 224 | - | 224 | - | 224 |
| Experience losses | (13) | - | (13) | - | (13) |
| Change in effect of limit on plan surplus | - | - | - | 13 | 13 |
| Remeasurement gains/(losses) recognised in other comprehensive income | 211 | (253) | (42) | 13 | (29) |
| Exchange differences | (1) | 1 | - | - | - |
| Employer contributions | - | 37 | 37 | - | 37 |
| Benefit payments | 186 | (186) | - | - | - |
| At 31 December | (2,856) | 4,527 | 1,671 | (598) | 1,073 |
�
Investment strategy is directed by the trustee boards (where relevant) who pursue different strategies according to the characteristics and maturity profile of each plan's liabilities. Assets and liabilities are managed holistically to create a portfolio with the dual objectives of return generation and liability management. In the principal plan this is achieved through a diversified multi-asset absolute return strategy seeking consistent positive returns, and hedging techniques which protect liabilities against movements arising from changes in interest rates and inflation expectations. Derivative financial instruments support both of these objectives and may lead to increased or decreased exposures to the physical asset categories disclosed below.
To provide more information on the approach used to determine and measure the fair value of the plan assets, the fair value hierarchy has been used as defined in Note 40. Those assets which cannot be classified as level 1 have been presented together as level 2 or 3.
The distribution of the fair value of the assets of the Group's funded defined benefit plans is as follows:
| � | Principal plan | Other | Total | |||
| � | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 |
| � | �m | �m | �m | �m | �m | �m |
| Assets measured at fair value based on level 1 inputs | � | � | � | � | � | � |
| Derivatives | 3 | 9 | - | 1 | 3 | 10 |
| Equity securities | 171 | 81 | - | - | 171 | 81 |
| Interests in pooled investment funds | � | � | � | � | � | � |
| Debt | 330 | 308 | 12 | - | 342 | 308 |
| Equity | - | - | 34 | 26 | 34 | 26 |
| Property | 117 | 115 | 6 | 9 | 123 | 124 |
| Absolute return | 68 | 60 | 116 | 109 | 184 | 169 |
| Cash | 275 | 297 | 22 | 36 | 297 | 333 |
| Debt securities | 3,098 | 2,494 | 4 | 31 | 3,102 | 2,525 |
| Total assets measured at fair value based on level 1 inputs | 4,062 | 3,364 | 194 | 212 | 4,256 | 3,576 |
| Assets measured at fair value based on level 2 or 3 inputs | � | � | � | � | � | � |
| Derivatives | 262 | 289 | (4) | (6) | 258 | 283 |
| Equity securities | 102 | 102 | - | - | 102 | 102 |
| Interests in pooled investment funds | � | � | � | � | � | � |
| Debt | 104 | 100 | - | - | 104 | 100 |
| Multi-asset private markets | 157 | 149 | - | - | 157 | 149 |
| Property | - | - | 10 | - | 10 | - |
| Debt securities | 121 | 163 | 34 | - | 155 | 163 |
| Qualifying insurance policies | 6 | 5 | 71 | 64 | 77 | 69 |
| Total assets measured at fair value based on level 2 or 3 inputs | 752 | 808 | 111 | 58 | 863 | 866 |
| Cash and cash equivalents | 222 | 381 | 3 | 6 | 225 | 387 |
| Liability in respect of collateral held | (426) | (300) | - | - | (426) | (300) |
| Other | (1) | (2) | - | - | (1) | (2) |
| Total | 4,609 | 4,251 | 308 | 276 | 4,917 | 4,527 |
Further information on risks is provided in Section (g) of this note. The �3,257m (2018: �2,688m) of debt securities includes �3,205m (2018: �2,622m) government bonds (including conventional and index-linked). Of the remaining �52m (2018: �66m) debt securities, �22m (2018: �42m) are investment grade corporate bonds or certificates of deposit.
Included in the qualifying insurance policy asset of �77m (2018: �69m) is an insurance policy purchased by the trustees of one of the Other UK defined benefit plans to protect the plan against future investment and actuarial risks. It has been valued at �64m (2018: �56m) with reference to the estimated benefits that will be paid by the insurer using the same assumptions and approach used to value the present value of the funded obligation covered by the policy.
One Other UK plan has a contract in place to hedge longevity risk for pensioners. The fair value of this derivative is �nil at 31 December 2019 (2018: �nil).
(e) ��� Estimates and assumptions
Determination of the valuation of principal plan liabilities is a key estimate as a result of the assumptions made relating to both economic and non-economic factors.
The key economic assumptions for the principal plan, which are based in part on current market conditions, are shown below:
| � | 2019 | 2018 |
| � | % | % |
| Discount rate | 2.05 | 2.85 |
| Rates of inflation | � | � |
| Consumer Price Index (CPI) | 2.00 | 2.20 |
| Retail Price Index (RPI) | 2.90 | 3.20 |
The changes in economic assumptions over the period reflect changes in both corporate bond prices and market implied inflation.
The most significant non-economic assumption for the principal plan is post-retirement longevity which is inherently uncertain. The assumptions (along with sample expectations of life) are illustrated below:
| � | � | � | Normal Retirement Age (NRA) | Expectation of life from NRA | |||
| � | � | � | Male age today | Female age today | |||
| 2019 | Table | Improvements | NRA | 40 | NRA | 40 | |
| � | Plan specific basis (calibrated by Club Vita) reflecting membership demographics | Advanced parameterisation of CMI 2013 mortality improvements model - adjusted to assume that improvements continue to increase in the short term before declining toward an ultimate long-term rate of 1.375% | 60 | 30 | 32 | 32 | 34 |
�
| � | � | � | Normal Retirement | Expectation of life from NRA | |||
| � | � | � | Male age today | Female age today | |||
| 2018 | Table | Improvements | NRA | 40 | NRA | 40 | |
| � | Plan specific basis (calibrated by Club Vita) reflecting membership demographics | Advanced parameterisation of CMI 2013 mortality improvements model - adjusted to assume that improvements continue to increase in the short term before declining toward an ultimate long-term rate of 1.375% | 60 | 30 | 32 | 32 | 34 |
These assumptions reflect a cautious allowance for the recently observed slowdown in longevity improvements.
The graph below provides an illustration of the undiscounted expected benefit payments included in the valuation of the principal plan obligations.
Diagram removed for the purposes of this announcement.� However it can be viewed in full in the pdf document
| � | 2019 | 2018 |
| Weighted average duration | years | years |
| Current pensioner | 15 | 14 |
| Non-current pensioner | 28 | 28 |
(g)(i) Risks and mitigating actions
The Group's consolidated statement of financial position is exposed to movements in the defined benefit plans' net asset. In particular, the consolidated statement of financial position could be materially sensitive to reasonably likely movements in the principal assumptions for the principal plan. By offering post-retirement defined benefit pension plans the Group is exposed to a number of risks. An explanation of the key risks and mitigating actions in place for the principal plan is given below.
Investment strategy risks include underperformance of the absolute return strategy and underperformance of the liability hedging strategy. As the trustees set investment strategy to protect their own view of plan strength (not the IAS 19 position), changes in the IAS 19 liabilities (e.g. due to movements in corporate bond prices) may not always result in a similar movement in plan assets.
Failure of the asset strategy to keep pace with changes in plan liabilities would expose the plan to the risk of a deficit developing, which could increase funding requirements for the Group.
Falls in yields would in isolation be expected to increase the defined benefit plan liabilities.
The principal plan uses both bonds and derivatives to hedge out yield risks on the plan's funding basis, rather than the IAS 19 basis, which is expected to minimise the plan's need to rely on support from the Group.
Increases in inflation expectations would in isolation be expected to increase the defined benefit plan liabilities.
The principal plan uses both bonds and derivatives to hedge out inflation risks on the plan's funding basis, rather than the IAS 19 basis, which is expected to minimise the plan's need to rely on support from the Group.
In the principal plan pensions in payment are generally linked to CPI, however inflationary risks are hedged using RPI instruments due to lack of availability of CPI linked instruments. Therefore, the plan is exposed to movements in the actual and expected long-term gap between RPI and CPI.
A House of Lords report in 2019 raised the potential for changes to the RPI measure of inflation, which was followed by recommendations from the UK Statistics Authority. While uncertainty remains, there is a risk that future cash flows from, and thus the value of, the plan's RPI-linked assets will fall without any corresponding reduction in the plan's CPI-linked liabilities.�While not directly observable from market data, the plan's RPI-linked asset values may already reflect an element of the expected changes and risk of such changes.�We continue to monitor developments closely.
Increases in life expectancy beyond those currently assumed will lead to an increase in plan liabilities. Regular reviews of longevity assumptions are performed to ensure assumptions remain appropriate.
The sensitivity of the principal plan's obligation and assets to the key assumptions is disclosed below.
| � | � | 2019 | 2018 | ||
| � | Change in assumption | (Increase)/decrease in present value | Increase/(decrease) in fair value of | (Increase)/decrease | Increase/(decrease) |
| � | � | �m | �m | �m | �m |
| Yield/discount rate | Decrease by 1% (e.g. from 2.05% to 1.05%) | (846) | 1,522 | (729) | 1,534 |
| Increase by 1% | 593 | (1,092) | 524 | (1,080) | |
| | | | | | |
| Rates of inflation | Decrease by 1% | 587 | (889) | 479 | (942) |
| Increase by 1% | (756) | 1,243 | (683) | 1,323 | |
| | | | | | |
| Life expectancy | Decrease by 1 year | 82 | - | 73 | - |
| Increase by 1 year | (96) | - | (68) | - | |
| | | | | | |
Where the Group receives fees in advance (front-end fees) for services it is providing, including investment management services, these fees are initially recognised as a deferred income liability and released to the consolidated income statement over the period services are provided.
�
| � | � | 2019 | 2018 |
| � | � | �m | �m |
| At 1 January | � | 75 | 157 |
| Reclassified as held for sale during the year | � | - | (157) |
| Additions during the year | � | - | 78 |
| Released to the consolidated income statement as revenue from contracts with customers | � | (8) | (3) |
| At 31 December | � | 67 | 75 |
The deferred income at 31 December 2019 and 31 December 2018 relates to future services to be provided to Phoenix in relation to certain client propositions. The amount of deferred income expected to be settled after more than 12 months is �60m (2018: �67m).
36.�� Other financial liabilities
| � | � | 2019 | 20181 |
| � | Notes | �m | �m |
| Outstanding purchases of investment securities | � | - | 2 |
| Accruals | � | 469 | 492 |
| Creation of units awaiting settlement | � | 110 | 167 |
| Lease liabilities | 18 | 268 | - |
| Cash collateral held in respect of derivative contracts | 38 | 21 | 21 |
| Bank overdrafts | 24 | 338 | 216 |
| Contingent consideration liabilities | 40 | 14 | 29 |
| Other | � | 95 | 234 |
| Other financial liabilities | � | 1,315 | 1,161 |
1��� Comparatives for 2018 have been represented to exclude unit linked liabilities. Refer Note 25.
The amount of other financial liabilities expected to be settled after more than 12 months is �239m (2018: �15m).
Accruals includes �3m (2018: �5m) relating to contracts with customers (refer Note 4(b)).
Provisions are obligations of the Group which are of uncertain timing or amount. They are recognised when the Group has a present obligation as a result of a past event, it is probable that a loss will be incurred in settling the obligation and a reliable estimate of the amount can be made.
The movement in provisions during the year is as follows:
| � | Separation costs | Other | Total |
| 2019 | �m | �m | �m |
| Opening balance carried forward | 80 | 25 | 105 |
| Effect of change in accounting policy to IFRS 161 | - | (12) | (12) |
| At 1 January | 80 | 13 | 93 |
| | | | |
| Charged/(credited) to the consolidated income statement | � | � | � |
| Additional provisions | - | 19 | 19 |
| Release of unused provision | - | (7) | (7) |
| Used during the year | (3) | - | (3) |
| At 31 December | 77 | 25 | 102 |
1��� The Group has initially applied IFRS 16 at 1 January 2019. Under the transition method chosen, comparative information is not restated and the cumulative effect of initially applying this standard is recognised in retained earnings at the date of initial application. Refer Basis of preparation.
�
| � | Provision for annuity sales practices | Separation costs | Other | Total |
| 2018 | �m | �m | �m | �m |
| At 1 January | 248 | - | 68 | 316 |
| Reclassified as held for sale during the year | (248) | - | (33) | (281) |
| Charged/(credited) to the consolidated income statement | � | � | � | � |
| Additional provisions | - | 80 | 7 | 87 |
| Release of unused provision | - | - | (9) | (9) |
| Used during the year | - | - | (8) | (8) |
| At 31 December | - | 80 | 25 | 105 |
The provision for separation costs of �77m (2018: �80m) is for costs expected to be incurred following the sale of the UK and European insurance business to Phoenix. Refer Note 1 for further details.�We announced in the Sale Circular on 30 May 2018 that we expected to incur one-off costs relating to the separation of the business sold of approximately �250m. As our work has progressed we have encountered additional complexity resulting from the separation of the technology infrastructure and as a result we now expect these one-off separation costs to be �310m. Our judgement is that a provision should be recognised for costs for which the Group will not derive ongoing benefits such as those relating to the de-coupling and decommissioning of systems and data but that a provision should not be recognised for costs related to the development of replacement systems and services as these will give future benefits.�No additional provision has been recognised in the year ended 31 December 2019 for the additional �60m of estimated costs as it is judged to relate to expenditure from which the Group will derive future benefits. The costs covered by the provision are expected to be incurred in the next two years.
Other provisions primarily relate to restructuring and are expected to be settled within 12 months.
The amount of provisions expected to be settled after more than 12 months is �34m (2018: �72m).
The provision for annuity sales practices related to the UK and European insurance business sold during 2018. Refer Note 40 for disclosures relating to the valuation of the related contingent consideration.
As at 31 December 2019, other liabilities totalled �5m (2018: �9m). The amount of other liabilities expected to be settled after more than 12 months is �2m (2018: �2m).
(a)���� Overview
The principal risks and uncertainties that affect the Group's business model and the Group's approach to risk management are set out in the Risk management section of the Strategic report.
The Group's exposure to financial instrument risk is derived from the financial instruments that it holds directly, the assets and liabilities of the unit linked funds of the life operations of the Group and the Group's defined benefit pension plans. In addition due to the nature of the business, the Group's secondary exposure extends to the impact on investment management and other fees that are determined on the basis of a percentage of AUM and are therefore impacted by financial risks borne by third party investors. In this note exposures and sensitivities provided relate to the financial instrument assets and liabilities, in scope of IFRS 7, to which the shareholder is directly exposed.
For the purposes of this note:
�� Shareholder business refers to the assets and liabilities to which the shareholder is directly exposed. The shareholder refers to the equity holders of the Company and the preference shareholders.
�� Unit linked funds refers to the assets and liabilities of the unit linked funds of the life operations of the Group. It does not include the cash flows (such as asset management charges or investment expenses) arising from the unit linked fund contracts. These cash flows are included in shareholder business.
�� Third party interest in consolidated funds and non-controlling interests refers to the assets and liabilities recorded on the Group's consolidated statement of financial position which belong to third parties. The Group controls the entities which own the assets and liabilities but the Group does not own 100% of the equity or units of the relevant entities.
Unit linked funds are excluded from the analysis in this note. Details regarding the financial risks of instruments relating to the Group's unit linked funds can be found in Note 25 and the risks relating to the Group's principal defined benefit pension plan are explained in Note 34.
Third party interests in consolidated funds do not expose the shareholder to market, credit or liquidity risk since the financial risks from the assets and obligations are borne by third parties. As a result equity risk, interest rate risk and credit risk quantitative disclosures in this note exclude these assets.
Under IFRS 7 the following financial instruments are excluded from scope:
�� Interests in subsidiaries, associates and joint ventures
�� Rights and obligations arising from employee benefit plans
�� Insurance contracts as defined by IFRS 4
�� Share-based payment transactions
For the purposes of managing risks to the Group's financial instrument assets and liabilities, the Group considers the following categories:
| Risk | Definition and exposure |
| Market | The risk of financial loss as a result of adverse financial market movements. The shareholder is directly exposed to the impact of movements in equity prices, interest rates and foreign exchange rates on the value of assets held by the shareholder business. |
| Credit | The risk of financial loss as a result of the failure of a counterparty, issuer or borrower to meet their obligations or perform them in a timely manner. The shareholder is directly exposed to credit risk from holding cash, debt securities, loans and derivative financial instruments. |
| Liquidity | The risk of financial loss as a result of being unable to settle financial obligations when they fall due, as a result of having insufficient liquid resources or being unable to realise investments and other assets other than at excessive costs. The shareholder is directly exposed to the liquidity risk from the shareholder business if it is unable to realise investments and other assets in order to settle its financial obligations when they fall due, or can do so only at excessive cost. |
Market risk exposures in the Asset management, platforms and wealth segment primarily arise as a result of holdings in newly established investment vehicles which the Group has seeded and co-investments in property and infrastructure funds. Seed capital is classified as held for sale when it is the intention to dispose of the vehicle in a single transaction and within one year. Co-investments are typically held for a longer term and align the Group's economic interests with those of property, private equity and infrastructure fund co-investors. The consolidated statement of financial position includes the following amounts in respect of seed capital and co-investments.
| | | 2019 | 2018 |
| | Notes | �m | �m |
| Equity securities and interests in pooled investment funds at FVTPL | | 195 | 76 |
| Debt securities | | 78 | 22 |
| Assets held for sale | 23 | 2 | 81 |
| Total seed capital | | 275 | 179 |
| | | | � |
| Equity securities and interests in pooled investment funds at FVTPL | | 84 | 37 |
| Total co-investments | | 84 | 37 |
The Group sets limits for investing in seed capital and co-investment activity and regularly monitors exposures arising from these investments. The Group will consider hedging its exposure to market and currency risk in respect of seed capital investments where it is appropriate and efficient to do so. The Group will also consider hedging its exposure to currency risk in respect of co-investments where it is appropriate and efficient to do so. Other market risks associated with co-investments are not hedged given the need for the Group's economic interests to be aligned with those of the co-investors.
Market risk exposure also arises to the extent that the market value of assets held to back debt issued does not move in line with the market value of the liabilities being backed. This risk is controlled through having robust processes in place to limit the use of proceeds from debt issuance and includes the use of investment constraints and portfolio limits.
The main elements of market risk to which the Group is exposed are equity risk, interest rate risk and foreign currency risk, which are discussed on the following pages.
Information on the methods used to determine fair values for each major category of financial instrument measured at fair value is presented in Note 40.
The Group is exposed to the risk of adverse equity market movements which could result in losses. This applies to daily changes in the market values and returns on the holdings in its equity securities portfolio.
At 31 December 2019 the shareholder exposure to equity markets was �199m (2018: �37m) in relation to equity securities. In addition the shareholder has interests in pooled investment funds of �458m (2018: �464m). Equity securities and interests in pooled funds in the consolidated statement of financial position of �725m includes �68m of third party interests in consolidated funds.
The shareholder exposure to equity securities of �199m (2018: �37m) primarily relates to seed capital of �118m (2018: �19m) and �48m (2018: �nil) held by the Standard Life Foundation.
The shareholder exposure of �458m (2018: �464m) to interests in pooled investment funds primarily relates to:
�� Corporate funds held in absolute return funds which are not consolidated of �210m (2018: �197m)
�� Co-investment holdings in property and infrastructure funds of �84m (2018: �37m)
�� Seed capital in funds which are not consolidated of �77m (2018: �57m)
�� Investments in certain managed funds to hedge against liabilities from variable pay awards that are deferred and settled in cash by reference to the share price of those funds of �44m (2018: �53m)
�� Holdings in cash funds which are not consolidated of �5m (2018: �5m)
�� Interest in pooled funds held by the Standard Life Foundation of �35m (2018: �81m)
Exposures to equity securities are primarily controlled through the limits imposed on the amount of seed capital and co-investment activity that may be undertaken.
The sensitivity of profit after tax to changes in equity security prices for the shareholder business is included in the profit after tax sensitivity to market risk table, shown in Section (b)(ii).
Interest rate risk is the risk that arises from exposures to changes in the shape and level of yield curves which could result in losses due to the value of financial assets and liabilities, or the cash flows relating to these, fluctuating by different amounts.
The main financial assets held by the Group which give rise to interest rate risk are debt securities and cash and cash equivalents. The main financial liabilities giving rise to interest rate risk principally comprise subordinated liabilities. Derivative financial instruments held by the Group also give rise to interest rate risk.
Interest rate exposures are managed in line with the Group's risk appetite. Group companies typically use a combination of cash flow and duration matching techniques to manage their interest rate risk at an entity level.
The sensitivity of profit after tax to changes in interest rates for the shareholder business is included in the profit after tax sensitivity to market risk table, shown in Section (b)(ii).
The Group's financial assets are generally held in the local currency of its operational geographic locations. Foreign currency risk arises where adverse movements in currency exchange rates impact the value of revenues received from, and the value of assets and liabilities held in, currencies other than UK Sterling. Foreign currency risk for shareholders also arises from the Group's investments in overseas subsidiaries, and in associates and joint ventures accounted for using the equity method.
The Group generally does not hedge the currency exposure relating to revenue and expenditure, nor does it hedge translation of overseas profits in the income statement. Where appropriate, the Group may use derivative contracts to reduce or eliminate currency risk arising from individual transactions or seed capital and co-investment activity.
The table below summarises the financial instrument exposure to foreign currency risks in UK Sterling. The table excludes inter-segment assets and liabilities.
| | | UK | Euro | Canadian | Hong Kong Dollar | US | Singapore Dollar | Other | Total | ||||||||
| | | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 |
| | Notes | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m |
| Financial assets | 19 | 3,387 | 3,158 | 256 | 190 | 13 | 10 | 6 | 10 | 356 | 244 | 80 | 117 | 192 | 193 | 4,290 | 3,922 |
| Financial liabilities | 32 | (1,246) | (1,533) | (57) | (20) | (1) | - | (4) | (1) | (718) | (668) | (19) | (18) | (47) | (32) | (2,092) | (2,272) |
| Net investment hedges | | - | 6 | - | - | - | - | - | (6) | - | - | - | - | - | - | - | - |
| Cash flow hedges | | (566) | (589) | - | - | - | - | - | - | 566 | 589 | - | - | - | - | - | - |
| Non- designated derivatives | | 266 | 108 | (62) | (26) | - | - | (1) | - | (131) | (68) | - | - | (72) | (14) | - | - |
| | | 1,841 | 1,150 | 137 | 144 | 12 | 10 | 1 | 3 | 73 | 97 | 61 | 99 | 73 | 147 | 2,198 | 1,650 |
Other currencies include assets of �12m (2018: �13m) and liabilities of �nil (2018: �3m) in relation to the fair value of derivatives used to manage currency risk.
In addition to financial instruments analysed above, the principal source of foreign currency risk for shareholders arises from the Group's investments in overseas subsidiaries and associates and joint ventures accounted for using the equity method.
The Group has holdings in Indian and Chinese associates and joint ventures. The carrying value and, where listed, market value is disclosed in Note 16. The Group does not hedge foreign currency risk in relation to these investments.
On 18 October 2017, the Group issued US dollar subordinated notes with a principal amount of US$750m. The related cash flows expose the Group to foreign currency risk on the principal and coupons payable. The Group manages the foreign exchange risk with a cross-currency swap which is designated as a cash flow hedge.
Non-designated derivatives relate to foreign exchange forward contracts that are not designated as cash flow hedges or net investment hedges.
The Group's profit after tax and equity are sensitive to variations in respect of the Group's market risk exposures and a sensitivity analysis is presented below. The analysis has been performed by calculating the sensitivity of profit after tax and equity to changes in equity security prices (price risk), changes in interest rates (interest rate risk) and changes in foreign exchange rate (foreign currency risk) as at the reporting date applied to assets and liabilities other than those classified as held for sale. These sensitivities concern only the direct impact on financial instruments and exclude indirect impacts on fee income and certain costs that may be affected by changes in the variable. The changes used in the sensitivity analysis are considered reasonable assumptions and are consistent with market peers.
The sensitivity of the Group's profit after tax and equity may be non-linear and larger or smaller impacts should not be derived from these results.
The sensitivity analysis represents the impact on profit at year end that the changes in market conditions can have. The sensitivity will vary with time, both due to changes in market conditions and changes in the actual asset mix, and this mix is being actively managed. The results of the sensitivity analysis may also have been different from those illustrated had the sensitivity factors been applied at a date other than the reporting date.
For each sensitivity 'test', the impact of a reasonably possible change in a single sensitivity factor is presented, while the other sensitivity factors remain unchanged. Correlations between the different risks and/or other factors may mean that experience would differ from that expected if more than one risk event occurred simultaneously.
These sensitivities concern only the impact on financial instruments and exclude indirect impacts of the variable on fee income and certain costs which may be affected by the changes in market conditions.
The impact of the following price risk assumptions on profit and equity, net of tax, are as follows:
| | Impact on profit after tax1 | |
| | 2019 | 2018 |
| | �m | �m |
| Change in equity security prices | � | � |
| +10% | 40 | 16 |
| -10% | (40) | (16) |
| +20% | 81 | 32 |
| -20% | (81) | (32) |
1��� A positive number for impact on profit after tax represents a credit to the consolidated income statement.
The sensitivity of the Group's total equity to variations in equity securities prices is the same as the sensitivity of the Group's profit after tax.
The impact of the following interest rate assumptions on profit and equity, net of tax, are as follows:
| | Impact on profit after tax1 | Impact on equity | ||
| | 2019 | 2018 | 2019 | 2018 |
| | �m | �m | �m | �m |
| Change in interest rates | | | | |
| +1%2 | (2) | 7 | (2) | (4) |
| -1%2 | 2 | (7) | 2 | 4 |
1��� A positive number for impact on profit after tax represents a credit to the consolidated income statement.
2��� The interest rate sensitivity is a parallel shift subject to a floor of -30bps.
The impact of interest rate changes on profit after tax primarily relates to cash and cash equivalents.
In 2018, the Group's financial instruments include certain debt securities classified as available-for-sale. These debt securities were measured at fair value. Interest was calculated using the effective interest method and recognised in the consolidated income statement. Other changes in fair value and the related tax were recognised in other comprehensive income. As a result, in 2018 the sensitivity of the Group's equity to variations in interest rate risk exposures differed from the sensitivity of the Group's profit after tax to variations in interest rate risk exposures.
The impact of the following foreign exchange rate assumptions on profit and equity, net of tax, are as follows:
| | Impact on profit after tax1 and on equity | |||||
| | 2019 | 2018 | ||||
| | USD | EUR | SGD | USD | EUR | SGD |
| | �m | �m | �m | �m | �m | �m |
| Change in foreign exchange rates | | | | | | |
| +10%2 | 11 | 15 | 5 | 19 | 16 | 9 |
| -10%2 | (11) | (15) | (5) | (19) | (16) | (9) |
1��� A positive number for impact on profit after tax represents a credit to the consolidated income statement.
2��� The foreign exchange sensitivity is the impact of a 10% movement in each currency against UK Sterling.
Exposures to credit risk and concentrations of credit risk are managed by setting exposure limits for different types of financial instruments and counterparties. The limits are established using the following controls:
| Financial instrument with credit risk exposure | Control |
| Cash and cash equivalents | Maximum counterparty exposure limits are set with reference to internal credit assessments. |
| Derivative financial instruments | Maximum counterparty exposure limits, net of collateral, are set with reference to internal credit assessments. The forms of collateral that may be accepted are also specified and minimum transfer amounts in respect of collateral transfers are documented. |
| Debt securities | The Group's policy is to set exposure limits by name of issuer, sector and credit rating. |
| Other financial instruments | Appropriate limits are set for other financial instruments to which the Group may have exposure at certain times. |
Group Treasury perform central monitoring of exposures against limits and are responsible for the escalation of any limit breaches to the Chief Risk Officer.
The Group adopted IFRS 9 Financial Instruments on 1 January 2019. Prior to adoption of IFRS 9, under IAS 39 impairment was only recognised when a default occurred. See Basis of preparation for further information.
Under IFRS 9, expected credit losses (ECL) are calculated on financial assets which are measured at amortised cost.
Financial assets attract an ECL allowance equal to either:
| 12 month ECL (losses resulting from possible default within the next 12 months) | -����� No significant increase in credit risk since initial recognition. -����� Trade receivables or contract assets with significant financing component, or lease receivables if lifetime ECL measurement has not been elected |
| Lifetime ECL (losses resulting from possible defaults over the remaining life of the financial asset) | -����� Significant increase in credit risk since initial recognition, -����� Trade receivables or contract assets with no significant financing component -����� Trade receivables or contract assets with significant financing component, or lease receivables for which lifetime ECL measurement has been elected |
| Changes in Lifetime ECL | -����� Credit-impaired at initial recognition |
In determining if a significant increase in the risk of default occurring has arisen since initial recognition the Group considers a range of factors including whether a default has taken place, deterioration in credit quality of a counterparty and knowledge of specific events which could influence a counterparty's ability to pay.
The Group assumes that a significant increase in credit risk has arisen when contractual payments are more than 30 days past due. The Group assumes that credit risk on a financial instrument has not increased significantly since initial recognition if the financial instrument is determined to have low credit risk at the reporting date. Financial instruments with an external rating of 'investment grade' are determined to have low credit risk. Investment grade financial instruments are financial assets with credit ratings assigned by external rating agencies with classification within the range of AAA to BBB. If a financial asset is not rated by an external agency it is classified as 'not rated'.
The Group applies the simplified approach, as permitted under IFRS 9, to calculate the ECL allowance for trade receivables, contract assets and lease receivables. Under the simplified approach, the ECL allowance is calculated over the remaining life of the asset, using a provision matrix approach based on historic observed default rates adjusted for knowledge of specific events which could influence loss rates.
The following table presents an analysis of the credit quality of shareholder financial assets and the maximum exposure to credit risk without taking into account any collateral held:
| | | � | Amortised cost | � | |
| | Fair value through profit or loss | Cash flow hedge | 12 month | Lifetime ECL - not credit impaired | Total |
| 2019 | �m | �m | �m | �m | �m |
| AAA | - | - | 100 | - | 100 |
| AA+ to AA- | 178 | - | 843 | - | 1,021 |
| A+ to A- | 485 | 3 | 1,146 | - | 1,634 |
| BBB | 54 | - | 120 | - | 174 |
| BB | - | - | 2 | - | 2 |
| Not rated | 25 | - | 187 | 372 | 584 |
| Gross carrying amount | 742 | 3 | 2,398 | 372 | 3,515 |
| Loss allowance | - | - | - | - | - |
| Carrying amount | 742 | 3 | 2,398 | 372 | 3,515 |
| | | | | | |
| Derivative financial assets | 16 | 3 | - | - | 19 |
| Debt securities | 725 | - | 602 | - | 1,327 |
| Receivables and other financial assets | 1 | - | 187 | 372 | 560 |
| Cash and cash equivalents | - | - | 1,609 | - | 1,609 |
| Carrying amount | 742 | 3 | 2,398 | 372 | 3,515 |
�
| | Designated at fair value through profit or loss | Held for trading | Cash flow hedge | Available-for-sale | Loans and receivables | Total |
| 2018 | �m | �m | �m | �m | �m | �m |
| Neither past due nor impaired: | | | | | | |
| AAA | - | - | - | 36 | 162 | 198 |
| AA+ to AA- | 170 | - | - | 92 | 567 | 829 |
| A+ to A- | 515 | - | 13 | 605 | 350 | 1,483 |
| BBB | - | - | - | 113 | 20 | 133 |
| Below BBB | - | - | - | 16 | 3 | 19 |
| Not rated | 31 | 5 | - | - | 669 | 705 |
| Past due | - | - | - | - | 26 | 26 |
| Impaired | - | - | - | - | - | - |
| Carrying amount | 716 | 5 | 13 | 862 | 1,797 | 3,393 |
| | � | � | � | � | � | � |
| Derivative financial assets | - | 5 | 13 | - | - | 18 |
| Debt securities | 708 | - | - | 862 | - | 1,570 |
| Receivables and other financial assets | 8 | - | - | - | 687 | 695 |
| Cash and cash equivalents | - | - | - | - | 1,110 | 1,110 |
| Carrying amount | 716 | 5 | 13 | 862 | 1,797 | 3,393 |
In the table above debt securities exclude debt securities relating to third party interests in consolidated funds of �44m (2018: �17m). Cash and cash equivalents exclude cash and cash equivalents relating to third party interests in consolidated funds of �6m (2018: �nil). Derivative financial assets exclude derivative financial assets relating to third party interests in consolidated funds of �nil (2018: �1m). Receivables and other financial assets exclude receivables and other financial assets relating to third party interests in consolidated funds of �nil (2018: �2m). The shareholder is not exposed to the credit risk in respect of third party interests in consolidated funds since the financial risk of the assets are borne by third parties.
An analysis of debt securities by country based on the ultimate parent country of risk is provided below:
| | Government, provincial and municipal1 | Banks | Other financial institutions | Other | Other2 | Total3 | ||||||
| | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 |
| | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m |
| UK | 49 | 13 | 262 | 13 | 9 | 35 | 86 | 93 | 41 | 14 | 447 | 168 |
| Australia | - | - | 9 | 10 | 5 | - | - | - | - | - | 14 | 10 |
| Canada | - | - | - | 25 | - | - | - | - | - | - | - | 25 |
| China | - | - | 50 | 65 | - | - | - | - | - | - | 50 | 65 |
| Denmark | - | - | 30 | 45 | - | - | - | - | - | - | 30 | 45 |
| Finland | - | - | 60 | - | - | - | - | - | - | - | 60 | - |
| France | - | - | 277 | 459 | - | - | 16 | 17 | - | - | 293 | 476 |
| Germany | - | - | 45 | 115 | - | - | 25 | 19 | - | - | 70 | 134 |
| Japan | - | - | 30 | 50 | - | - | - | - | - | - | 30 | 50 |
| Mexico | - | - | - | - | - | - | 6 | 6 | - | - | 6 | 6 |
| Netherlands | - | - | 45 | 337 | - | - | - | - | - | - | 45 | 337 |
| Spain | - | - | - | 25 | - | - | 2 | 2 | - | - | 2 | 27 |
| Sweden | - | - | 53 | 63 | - | - | - | - | - | - | 53 | 63 |
| Switzerland | - | - | 60 | - | - | - | - | - | - | - | 60 | - |
| United Arab Emirates | - | - | 80 | 50 | - | - | - | - | - | - | 80 | 50 |
| US | - | - | - | 50 | 15 | 15 | 10 | 10 | 13 | - | 38 | 75 |
| Other | 2 | - | - | - | - | - | - | 8 | 47 | 31 | 49 | 39 |
| Total | 51 | 13 | 1,001 | 1,307 | 29 | 50 | 145 | 155 | 101 | 45 | 1,327 | 1,570 |
1��� Government, provincial and municipal includes debt securities which are issued by or explicitly guaranteed by the national government.
2��� This balance includes debt securities issued by supranationals.
3��� Total geographical exposures exclude debt securities relating to third party interests in consolidated funds of �44m (2018: �17m).
Collateral in respect of bilateral over-the-counter (OTC) derivative financial instruments and bilateral repurchase agreements is accepted from and provided to certain market counterparties to mitigate counterparty risk in the event of default. The use of collateral in respect of these instruments is governed by formal bilateral agreements between the parties. For OTC derivatives the amount of collateral required by either party is determined by the daily bilateral OTC exposure calculations in accordance with these agreements and collateral is moved on a daily basis to ensure there is full collateralisation. Under the terms of these agreements, collateral is posted with the ownership captured under title transfer of the contract. With regard to either collateral pledged or accepted, the Group may request the return of, or be required to return, collateral to the extent it differs from that required under the daily bilateral OTC exposure calculations.
Where there is an event of default under the terms of the agreements, any collateral balances will be included in the close-out calculation of net counterparty exposure. At 31 December 2019, the Group had pledged �18m (2018: �8m) of cash and �nil (2018: �nil) of securities as collateral for derivative financial liabilities. At 31 December 2019, the Group had accepted �21m (2018: �21m) of cash and �25m (2018: �50m) of securities as collateral for derivatives financial assets and reverse repurchase agreements. None of the securities were sold or repledged at the year end.
Financial assets and liabilities are offset and the net amount reported on the consolidated statement of financial position only when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Other than cash and cash equivalents disclosed in Note 24, the Group does not offset financial assets and liabilities on the consolidated statement of financial position, as there are no unconditional rights to set off. Consequently, the gross amount of other financial instruments presented on the consolidated statement of financial position is the net amount. The Group's bilateral OTC derivatives are all subject to an International Swaps and Derivative Association (ISDA) master agreement. ISDA master agreements and reverse repurchase agreements entered into by the Group are considered master netting agreements as they provide a right of set off that is enforceable only in the event of default, insolvency, or bankruptcy.
The Group does not hold any other financial instruments which are subject to master netting agreements or similar arrangements.
The following table presents the effect of master netting agreements and similar arrangements.
| | | Related amounts not offset on the consolidated | | |
| | Gross amounts of financial instruments as presented on the consolidated statement of financial position | Financial | Financial collateral pledged/(received) | Net position |
| As at 31 December 2019 | �m | �m | �m | �m |
| Financial assets | | | | |
| Derivatives2 | 13 | (2) | (9) | 2 |
| Reverse repurchase agreements | 25 | - | (25) | - |
| Total financial assets | 38 | (2) | (34) | 2 |
| Financial liabilities | | | | |
| Derivatives2 | (2) | 2 | - | - |
| Total financial liabilities | (2) | 2 | - | - |
�
| | | Related amounts not offset on the consolidated | | |
| | Gross amounts of financial instruments as presented on the consolidated statement of financial position | Financial | Financial collateral pledged/(received) | Net position |
| As at 31 December 20181 | �m | �m | �m | �m |
| Financial assets | | | | |
| Derivatives2 | 18 | - | (14) | 4 |
| Reverse repurchase agreements | 50 | - | (50) | - |
| Total financial assets | 68 | - | (64) | 4 |
| Financial liabilities | � | � | � | � |
| Derivatives2 | (3) | - | 3 | - |
| Total financial liabilities | (3) | - | 3 | - |
1��� Comparatives for 2018 have been represented to exclude unit linked liabilities. Refer Note 25.
2��� Only OTC derivatives subject to master netting agreements have been included above.
The shareholder is exposed to liquidity risk if the Group is unable to realise investments and other assets in order to settle its financial obligations when they fall due, or can do so only at excessive cost. The following quantitative liquidity risk disclosures are provided in respect of these financial liabilities.
The Group has a liquidity risk policy and processes in place for monitoring, assessing, and controlling liquidity risk.�
During the year, the Group refined its processes for managing liquidity risk through the operation of its liquidity risk framework.�This framework ensures that liquidity risks are identified and also identifies which entities in the Group have this exposure. Stress testing of these risks is performed to understand the quantum of risk under stress conditions.�This then informs the level of liquid resources that need to be maintained.�Where appropriate, this is enhanced with external credit facilities and the Group has a syndicated revolving credit facility of �400m which was undrawn at 31 December 2019.
The level of liquid resources in the Group is also projected under a number of adverse scenarios. These are described more fully in the Viability Statement.
Contingency funding plans are also maintained to ensure that if�liquidity risk did materialise, processes and procedures are already in place to assist with resolving the issue. Regular monitoring of liquid assets is performed and projections undertaken (under both base and stressed conditions) to understand the outlook.
As a result of the policies and processes established to manage risk, the Group expects to be able to manage liquidity risk on an ongoing basis. We recognise there are a number of scenarios that can impact the liquid resources of a business as discussed in the Risk management section of the Strategic report.�
The analysis that follows presents the undiscounted cash flows payable by remaining contractual maturity at the reporting date for all financial liabilities, other than those related to unit linked funds which are discussed in Note 25.
| | Within | 1-5 | 5-10 | 10-15 | 15-20 | Greater than | Total | |||||||
| | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 |
| | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m |
| Subordinated liabilities | 29 | 53 | 116 | 210 | 676 | 845 | 25 | 144 | 25 | 144 | 107 | 615 | 978 | 2,011 |
| Other financial liabilities | 1,124 | 1,141 | 107 | 2 | 102 | - | 57 | - | 14 | - | - | - | 1,404 | 1,143 |
| Total | 1,153 | 1,194 | 223 | 212 | 778 | 845 | 82 | 144 | 39 | 144 | 107 | 615 | 2,382 | 3,154 |
Refer Note 20 for the maturity profile of undiscounted cash flows of derivative financial instruments.
The Group also had unrecognised commitments in respect of financial instruments as at 31 December 2019 with a contractual maturity of within one year and between one and five years of �2m and �39m respectively (2018: �9m and �28m).
A structured entity is an entity that is structured in such a way that voting or similar rights are not the dominant factor in deciding who controls the entity. The Group has interests in structured entities through investments in a range of investment vehicles including:
�� Pooled investment funds managed internally and externally, including OEICs, SICAVs, unit trusts and limited partnerships
�� Debt securitisation vehicles which issue asset-backed securities
The Group consolidates structured entities which it controls. Where the Group has an investment in, but not control over these types of entities, the investment is classified as an investment in associate when the Group has significant influence. Investments in associates at FVTPL are included in equity securities and pooled investment funds in the analysis of financial investments.
The Group also has interests in structured entities through asset management fees and other fees received from these entities.
As at 31 December 2019 and 31 December 2018, the Group has not provided any non-contractual financial or other support to any consolidated structured entity and there are no current intentions to do so.
As at 31 December 2019 and 31 December 2018, the Group has not provided any non-contractual financial or other support to any unconsolidated structured entities and there are no current intentions to do so.
The following table shows the carrying value of the Group's interests in unconsolidated structured entities by line item in the consolidated statement of financial position.
| � | 2019 | 2018 |
| � | �m | ��m |
| Financial investments | � | � |
| Equity securities and interests in pooled investment funds | 917 | 675 |
| Debt securities | 12 | 13 |
| Total financial investments | 929 | 688 |
| Receivables and other financial assets | 221 | 280 |
| Other financial liabilities | 129 | 177 |
Equity securities and interests in pooled investment funds includes �650m (2018: �610m) of unconsolidated structured entities which are managed by the Group and in which the Group has a direct investment. At 31 December 2019 the asset value of these unconsolidated structured entities is �22,795m (2018: �21,020m). The total fees recognised in respect of these assets under management during the year to 31 December 2019 were �137m (2018: �44m).
The total issuance balance relating to unconsolidated structured debt securitisation vehicles in which the Group has an investment is �1,000m (2018: �1,000m).
The Group's maximum exposure to loss in respect of its investments in unconsolidated structured entities is the carrying value of the Group's investment and, where the structured entity is managed by the Group, loss of future fees. As noted in Note 38, the shareholder is not exposed to market or credit risk in respect of investments held in the unit linked funds, and third party interest in consolidated funds and non-controlling interests risk segments.
Additional information on how the Group manages its exposure to risk can be found in Note 38.
For those structured entities which the Group receives asset management or other fees from but has no direct investment, the maximum exposure to loss is loss of future fees.
Total assets under management of structured entities in which the Group has no direct investments but has other interests in are �102,558m at 31 December 2019 (2018: �136,047m). The fees recognised in respect of these assets under management during the year to 31 December 2019 were �581m (2018: �813m).
The Group uses fair value to measure many of its assets and liabilities. Fair value is the amount for which an asset could be exchanged, or a liability settled, between knowledgeable willing parties in an arm's length transaction.
(a) ��� Determination of fair value hierarchy
To provide further information on the approach used to determine and measure the fair value of certain assets and liabilities, the following fair value hierarchy categorisation has been used:
�� Level 1: Fair values measured using quoted prices (unadjusted) in active markets for identical assets or liabilities. An active market exists where transactions take place with sufficient frequency and volume to provide pricing information on an ongoing basis.
�� Level 2: Fair values measured using inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices)
�� Level 3: Fair values measured using inputs that are not based on observable market data (unobservable inputs)
An analysis of the Group's financial assets and financial liabilities in accordance with the categories of financial instrument set out in IFRS 9 Financial Instruments is presented in Notes 19, 25 and 32 and includes those financial assets and liabilities held at fair value.
Information on the methods and assumptions used to determine fair values for each major category of instrument measured at fair value is given below. These methods and assumptions include those used to fair value assets and liabilities held for sale, including the individual assets and liabilities of operations held for sale.
Investments in associates at FVTPL are valued in the same manner as the Group's equity securities and interests in pooled investment funds.
Equity instruments listed on a recognised exchange are valued using prices sourced from the primary exchange on which they are listed. These instruments are generally considered to be quoted in an active market and are therefore categorised as level 1 instruments within the fair value hierarchy.
The Group's exposure to unlisted equity securities primarily relates to interests in real estate, infrastructure and private equity funds. These are valued in accordance with independent professional valuations or International Private Equity and Venture Capital Valuation Guidelines where relevant. The fair value of unlisted investments in infrastructure funds is based on the phase of individual projects forming the overall investment and discounted cash flow techniques based on project earnings. The valuation of these securities is largely based on inputs that are not based on observable market data, and accordingly these instruments are categorised as level 3 instruments within the fair value hierarchy. Where appropriate, reference is made to observable market data.
The valuations received from investment managers of the underlying funds are reviewed and where appropriate adjustments are made to reflect the impact of changes in market conditions between the date of the valuation and the end of the reporting period. The valuation of these securities is largely based on inputs that are not based on observable market data, and accordingly these instruments are categorised as level 3 instruments within the fair value hierarchy. Where appropriate, reference is made to observable market data.
Where pooled investment funds have been seeded and the investment in the funds have been classified as held for sale, the costs to sell are assumed to be negligible. The fair value of pooled investment funds held for sale is calculated as equal to the observable unit price.
The majority of the Group's derivatives are over-the-counter derivatives which are measured at fair value using a range of valuation models including discounting future cash flows and option valuation techniques. The inputs are observable market data and over-the-counter derivatives are therefore categorised as level 2 in the fair value hierarchy.
Exchange traded derivatives are valued using prices sourced from the relevant exchange. They are considered to be instruments quoted in an active market and are therefore categorised as level 1 instruments within the fair value hierarchy.
Non-performance risk arising from the credit risk of each counterparty has been considered on a net exposure basis in line with the Group's risk management policies. At 31 December 2019 and 31 December 2018, the residual credit risk is considered immaterial and no credit risk adjustment has been made.
For debt securities, the Group has determined a hierarchy of pricing sources. The hierarchy consists of reputable external pricing providers who generally use observable market data. If prices are not available from these providers or are considered to be stale, the Group has established procedures to arrive at an internal assessment of the fair value. These procedures are based largely on inputs that are not based on observable market data. A further analysis by category of debt security is as follows:
�� Government, including provincial and municipal, and supranational institution bonds
These instruments are valued using prices received from external pricing providers who generally base the price on quotes received from a number of market participants. They are categorised as level 1 or level 2 instruments within the fair value hierarchy depending upon the nature of the underlying pricing information used for valuation purposes.
�� Corporate bonds listed or quoted in an established over-the-counter market including asset-backed securities
These instruments are generally valued using prices received from external pricing providers who generally consolidate quotes received from a panel of banks into a composite price. As the market becomes less active the quotes provided by some banks may be based on modelled prices rather than on actual transactions. These sources are based largely on observable market data, and therefore these instruments are categorised as level 2 instruments within the fair value hierarchy. When prices received from external pricing providers are based on a single broker indicative quote, the instruments are categorised as level 3 instruments.
For instruments for which prices are either not available from external pricing providers or the prices provided are considered to be stale, the Group performs its own assessment of the fair value of these instruments. This assessment is largely based on inputs that are not based on observable market data, principally single broker indicative quotes, and accordingly these instruments are categorised as level 3 instruments within the fair value hierarchy.
�� Other corporate bonds including unquoted bonds, commercial paper and certificates of deposit
These instruments are valued using models. For unquoted bonds the model uses inputs from comparable bonds and includes credit spreads which are obtained from brokers or estimated internally. Commercial paper and certificates of deposit are valued using standard valuation formulas. The categorisation of these instruments within the fair value hierarchy will be either level 2 or 3 depending upon the nature of the underlying pricing information used for valuation purposes.
Contingent consideration assets and liabilities have been recognised in respect of acquisitions and disposals. Generally valuations are based on unobservable assumptions regarding the probability weighted cash flows and, where relevant, discount rate and therefore the assets and liabilities are classified as level 3 in the fair value hierarchy. Significant contingent consideration arises under the terms of the sale of SLAL to Phoenix in August 2018. The terms include a number of indemnities that give rise to contingent consideration. The indemnities that have the most significant impact on the fair value of this contingent consideration are as follows:
�� Annuity sales practices
The annuity sales practices indemnity primarily relates to enhanced annuities. At the request of the FCA, SLAL has been conducting a review of non-advised annuity sales (with a purchase price above a minimum threshold) to customers eligible to receive an enhanced annuity from 1 July 2008 until 31 May 2016. The purpose of this review is to identify whether these customers received sufficient information about enhanced annuities to make the right decisions about their purchase, and, where appropriate, provide redress to customers who have suffered loss as a result of not having received sufficient information. SLAL has been working with the FCA regarding the process for conducting this past business review. The review is now substantially complete.
Under the indemnity if SLAL suffers a loss in excess of the provision it recognised at 31 December 2017 of �248m in relation to annuity sales practices, the Group will pay the excess to Phoenix subject to a �120m cap. If that provision is not fully utilised Phoenix will pay the Group the unutilised amount. In addition the Group paid to Phoenix an amount equivalent to the financial penalty of �31m levied by the FCA on SLAL in July 2019.
The technique used to value this element of the contingent consideration is to assess the likelihood of an over or under utilisation of the 31 December 2017 provision.
�� Persistency
If SLAL suffers adverse lapse experience relating to certain UK unit linked products (but excluding unit linked products written in a with profits fund) prior to 31 December 2019, the Group shall make a payment to Phoenix, based on the difference between expected and actual lapse experience, subject to a �75m cap.
The technique used to value this element of the contingent consideration is based on a statistical model used for the Group's Solvency II reporting at 31 December 2017, with each possible outcome weighted by the likelihood of that outcome.
In addition, the Group is currently engaged in ongoing discussions with Phoenix in respect of disagreements over the operation of certain aspects of the agreements that were entered into at the time of the sale of SLAL to Phoenix and which impact the value of the indemnities and other payments under the transaction terms. Whilst the Group and Phoenix are currently seeking a commercial resolution in respect of such disagreements, it is possible that all or some of these matters (and any other disagreements which may arise from time to time in respect of these agreements) could be escalated to a dispute resolution process provided for in the relevant agreements, which could result, if the Group and Phoenix fail to reach agreement, in either party commencing legal proceedings. Management's estimate of the impact of these discussions on the value of the arrangements entered into with Phoenix at the time of the sale of SLAL to Phoenix has been taken into account in the fair value of the contingent consideration.
The fair value of the non-participating investment contract liabilities is calculated equal to the fair value of the underlying assets and liabilities in the funds. Thus, the value of these liabilities is dependent on the methods and assumptions set out above in relation to the underlying assets and liabilities in which these funds are invested. The underlying assets and liabilities are predominately categorised as level 1 or 2 and as such, the inputs into the valuation of the liabilities are observable. Therefore, the liabilities are categorised within level 2 of the fair value hierarchy.
The fair value of liabilities in respect of third party interest in consolidated funds is calculated equal to the fair value of the underlying assets and liabilities in the funds. Thus, the value of these liabilities is dependent on the methods and assumptions set out above in relation to the underlying assets in which these funds are invested. When the underlying assets and liabilities are valued using readily available market information the liabilities in respect of third party interest in consolidated funds are treated as level 2. Where the underlying assets and liabilities are not valued using readily available market information the liabilities in respect of third party interest in consolidated funds are treated as level 3.
The table below presents the Group's non-unit linked assets measured at fair value by level of the fair value hierarchy (refer Note 25 for fair value analysis in relation to assets backing unit linked liabilities).
| � | � | � | � | Fair value hierarchy | ||||||||
| � | As recognised in the consolidated statement of financial position line item | Classified as | Total | Level 1 | Level 2 | Level 3 | ||||||
| � | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 |
| � | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m |
| Owner occupied property | 2 | 2 | - | - | 2 | 2 | - | - | - | - | 2 | 2 |
| Derivative financial assets | 19 | 19 | - | - | 19 | 19 | - | 1 | 19 | 18 | - | - |
| Equity securities and interests in pooled investment vehicles | 725 | 509 | 2 | 95 | 727 | 604 | 609 | 523 | 36 | 22 | 82 | 59 |
| Debt securities | 769 | 1,587 | 14 | 13 | 783 | 1,600 | 57 | 50 | 725 | 1,549 | 1 | 1 |
| Contingent consideration asset | 1 | 8 | - | - | 1 | 8 | - | - | - | - | 1 | 8 |
| Total assets at fair value | 1,516 | 2,125 | 16 | 108 | 1,532 | 2,233 | 666 | 574 | 780 | 1,589 | 86 | 70 |
Transfers from level 1 to level 2 and from level 2 to level 1 during the year ended 31 December 2019 were �7m (2018: �nil) and �6m (2018: �nil) respectively. These transfers relate to assets where changes in the frequency of observable market transactions resulted in a change in whether the market was considered active. Transfers are deemed to have occurred at the end of the calendar quarter in which they arose. Refer Note 40(c)(iii) for details of movements in level 3.
The table below presents the Group's non-unit linked liabilities measured at fair value by level of the fair value hierarchy.
| � | � | � | � | Fair value hierarchy | ||||||||
| � | As recognised in the consolidated statement of financial position | Classified as | Total | Level 1 | Level 2 | Level 3 | ||||||
| � | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 |
| � | �m | �m | ��m | �m | ��m | �m | ��m | �m | ��m | �m | ��m | �m |
| Liabilities in respect of third party interest in consolidated funds | 119 | 26 | - | 14 | 119 | 40 | - | - | 119 | 40 | - | - |
| Derivative financial liabilities | 3 | 4 | - | - | 3 | 4 | 1 | - | 2 | 4 | - | - |
| Contingent consideration liabilities | 14 | 29 | - | - | 14 | 29 | - | - | - | - | 14 | 29 |
| Total liabilities at fair value | 136 | 59 | - | 14 | 136 | 73 | 1 | - | 121 | 44 | 14 | 29 |
There were no significant�transfers between levels 1 and 2 during the year (2018: none). Refer Note 40(c)(iii) for details of movements in level 3.
The movements during the year of level 3 assets and liabilities held at fair value, excluding unit linked assets and liabilities and assets and liabilities held for sale, are analysed below.
| � | Investment property | Owner occupied property | Equity securities and interests in pooled investment funds | Debt securities | Liabilities in respect of third party interest in consolidated funds | |||||
| � | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 |
| � | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m |
| At 1 January | - | 9,749 | 2 | 81 | 59 | 994 | 1 | 1,444 | - | (1,298) |
| Reclassified to held for sale during the year | - | (9,749) | - | (79) | - | (921) | - | (1,443) | - | 1,298 |
| Total gains/(losses) recognised in the consolidated income statement | - | - | - | - | 2 | 5 | - | - | - | - |
| Purchases | - | - | - | - | 23 | 18 | - | - | - | - |
| Sales | - | - | - | - | (8) | (37) | - | - | - | - |
| Transfers in to level 31 | - | - | - | - | 6 | - | - | - | - | - |
| At 31 December | - | - | 2 | 2 | 82 | 59 | 1 | 1 | - | - |
1��� Transfers are deemed to have occurred at the end of the calendar quarter in which they arose.
�
| � | Contingent | Contingent | ||
| � | 2019 | 2018 | 2019 | 2018 |
| � | �m | �m | �m | �m |
| At start of period | 8 | 6 | (29) | (25) |
| Total amounts recognised in the income statement | 56 | (6) | 5 | 9 |
| Additions | - | 8 | (8) | (19) |
| Settlements | (63) | - | 18 | 6 |
| At end of period | 1 | 8 | (14) | (29) |
For the year ended 31 December 2019, gains of �nil from continuing operations (2018: gains of �6m) were recognised in the IFRS consolidated income statement in respect of assets and liabilities held at fair value classified as level 3 at the period end, excluding assets and liabilities held for sale. Of this amount �1m of losses (2018: gains of �7m) were recognised in other income with the remainder recognised in investment return.
Transfers of equity securities and interests in pooled investment funds and debt securities into level 3 generally arise when external pricing providers stop providing a price or where the price provided is considered stale. Transfers of equity securities and interests in pooled investment funds and debt securities out of level 3 arise when acceptable prices become available from external pricing providers.
The table below identifies the significant unobservable inputs used in determining the fair value of level 3 instruments at 31 December 2019:
| � | Fair value | � | � |
| 2019 | �m | Unobservable input | Input used |
| Equity securities and interests in pooled investment funds | 82 | This comprises holdings in approximately 100 separate funds, predominantly by value being interests in real estate, infrastructure and private equity funds. Given the numerous unobservable inputs pertaining to the valuation of the underlying assets in the funds no individual unobservable inputs are considered significant. | N/A |
| Contingent consideration assets and liabilities | (13) | Unobservable inputs relate to probability weighted cash flows; and where relevant, discount rates. The most significant unobservable inputs relate to assumptions used to value the contingent consideration related to the sale of SLAL to Phoenix, in particular those related to: | � |
| � | � | -����� SLAL's annuity sales practices provision | Expected amount required to cover the redress due to customers compared to SLAL's provision at 31 December 2017 |
| � | � | -����� Future lapse rates on relevant UK unit linked products of SLAL � | Statistical distribution used in the Group's Solvency II internal model at 31 December 2017 |
| � | � | -����� Management's assessment of the outcome of ongoing discussions with Phoenix in respect of disagreements over the operation of certain aspects of the governing contracts that were entered into at the time of the sale of SLAL to Phoenix | Our assessment of the expected resolution taking into account our legal advice |
�
| � | Fair value | � | � |
| 2018 | �m | Unobservable input | Input used |
| Equity securities and interests in pooled investment funds | 59 | This comprises holdings in approximately 80 separate funds, predominantly by value being interests in real estate, infrastructure and private equity funds. Given the numerous unobservable inputs pertaining to the valuation of the underlying assets in the funds no individual unobservable inputs are considered significant. | N/A |
| Contingent consideration assets and liabilities | (21) | Unobservable inputs relate to probability weighted cash flows and, where relevant, discount rates. The most significant unobservable inputs relate to assumptions used to value the contingent consideration related to the sale of SLAL to Phoenix, in particular those related to: | |
| � | | -����� SLAL's annuity sales practices provision (including the likelihood and value of annuity sales practices insurance recoveries and any FCA-levied penalty) | See below |
| � | | -����� Future lapse rates on relevant UK unit linked products of SLAL | Statistical distribution used in the Group's Solvency II internal model at 31 December 2017 |
�
�
Estimates and assumptions at 31 December 2019
At 31 December 2019 the contingent consideration relating to the indemnity covering future lapse rates on relevant UK unit linked products of SLAL is considered a source of estimation uncertainty with a significant risk of resulting in a material adjustment to the carrying amount of assets and liabilities within the next financial year.� Other elements of contingent consideration are not considered to be a critical accounting estimate at 31 December 2019.
The technique used to value the indemnity covering future lapses on relevant UK unit linked products of SLAL is based on a statistical model used for the Group's Solvency II reporting at 31 December 2017 (prior to the sale of the SLAL business to Phoenix), with each possible outcome weighted by the likelihood of the outcome.� Unobservable inputs are the statistical distribution of potential lapses over the indemnity period based on past experience.� The most likely amount payable is �nil and the range of possible impacts on the contingent consideration asset valuation from reasonably possible alternative assumptions is -�50m to +�25m.
The contingent consideration related to the annuity sales practices indemnity was considered a critical estimate in 2018 but is not considered a critical estimate in 2019 as the review of non-advised annuity sales is now substantially complete.� The valuation of the contingent consideration in relation to the annuity sales practices indemnity takes into account our view of the need for any changes in the provision held by SLAL.� During 2019 SLAL has released �79m of the provision that it recognised at 31 December 2017. This reflected the view that the overall level of the provision at 31 December 2017 was in excess of the amount required to cover the redress due to customers. The fair value of this component of the contingent consideration is based on an estimate of the amount expected to be paid by Phoenix to the Group under this indemnity.
The contingent consideration related to the annuity sales practices indemnity was considered to be an item for which assumptions and other sources of estimation uncertainty within the valuation technique at the end of the reporting period had a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the next financial year.
The valuation of the contingent consideration in relation to this indemnity takes into account our view of the need for any changes in the provision held by SLAL. At 31 December 2018 SLAL has not increased or released any element of the provision that it recognised at 31 December 2017. This reflected the view that the overall level of the provision at 31 December 2017 remained appropriate and therefore that the fair value of this component of the contingent consideration, before considering insurance recoveries and potential FCA-levied penalties, was not material. The valuation technique and underpinning assumptions were as follows:
The key assumptions underlying the provision for annuity sales practices relating to enhanced annuities were:
�� The number of customers entitled to redress
�� The amount of redress payable per customer
�� The costs of conducting the review
The number of customers entitled to redress has been estimated based on:
�� The number of customers in the review population
�� The estimated percentage of these customers eligible for an enhanced annuity
�� The estimated percentage of these eligible customers that did not receive sufficient information from SLAL about enhanced annuities
The FCA thematic review noted that between 39% and 48% of customers who bought a standard annuity may potentially have been eligible for an enhanced annuity. The provision assumed 40% of customers were eligible for an enhanced annuity based on observed experience from SLAL's review.
The FCA thematic review noted, for the industry as a whole, a plausible range of lost income for customers who were entitled to enhanced annuities but purchased standard annuities to be between �120 and �240 per annum for an average annuity purchase price of �25,000.
The lost income for customers who were entitled to enhanced annuities, for an average purchase price of �25,000, is assumed to be �300 per annum. This assumption was based on expected experience from SLAL's review utilising the redress calculator provided by the FCA in early 2018. This assumption was unchanged from that used at end 2017.
Assumptions relating to future annuity payments were consistent with SLAL's other annuity reserving assumptions.
The costs of conducting the review relate to administrative expenses per case and wider project costs. The costs were based on SLAL's project planning.
Sensitivities are provided in the table below.
| Assumption | Change in assumption | Consequential change in contingent consideration valuation |
| Percentage of customers eligible for an enhanced annuity | Percentage changed by +/-5 (e.g. 40% increased to 45%) | +/- �18m |
| Percentage of eligible customers that did not receive sufficient information from SLAL about enhanced annuities | Percentage changed by +/-5 | +/- �9m |
| Lost income per annum for an average annuity purchase of �25,000 | +/- �50 | +/- �28m |
| Costs per case of conducting the review | +/- 20% of the cost per case | +/- �5m |
In addition, the fair value of the contingent consideration took into account that substantially all of the �100m being sought by SLAL under insurance policies to mitigate the financial impact was received by the Group in January 2019 and was based on an assessment of the likelihood of a financial penalty and the FCA's methodology for calculating such penalties.
(c)(v) Sensitivity of the fair value of level 3 instruments to changes in key assumptions
At 31 December 2019 the shareholder is directly exposed to movements in the value of all level 3 instruments since none are held in the Group's unit linked funds or in consolidated structured entities. Estimates, assumptions and range of outcomes relating to contingent consideration assets and liabilities which are considered critical accounting estimates are discussed in Section (c)(iv). Changing unobservable inputs in the measurement of the fair value of other level 3 financial assets and financial liabilities to reasonably possible alternative assumptions would not have a significant impact on profit attributable to equity holders or on total assets.
The table below presents estimated fair values by level of the fair value hierarchy of non-unit linked financial assets and liabilities whose carrying value does not approximate fair value. Fair values of assets and liabilities are based on observable market inputs where available, or are estimated using other valuation techniques.
| � | � | As recognised in the consolidated statement of financial position line item | Fair value | Level 1 | Level 2 | Level 3 | |||||
| � | � | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 |
| | Notes | �m | �m | �m | �m | �m | �m | �m | �m | �m | �m |
| Assets | | | | | | � | � | � | � | � | � |
| Debt securities1 | � | 602 | - | 614 | - | 23 | - | 591 | - | - | - |
| Liabilities | � | � | � | � | � | � | � | � | � | � | � |
| Subordinated notes | 33 | 655 | 1,081 | 688 | 1,088 | - | - | 688 | 1,088 | - | - |
1��� Debt securities are held under IFRS 9 at amortised cost. They were previously held at fair value as available-for-sale under IAS 39.
The estimated fair values for subordinated liabilities are based on the quoted market offer price.
The carrying value of all other financial assets and liabilities measured at amortised cost approximates their fair value.
The Group classifies cash flows in the consolidated statement of cash flows as arising from operating, investing or financing activities.
Cash flows are classified based on the nature of the activity to which they relate and with consideration to generally accepted presentation adopted by peers. For activities related to asset management business, cash flows arising from the sale and purchase of debt securities and equity securities and interests in pooled investment funds, with the exception of those related to unit linked funds, are classified as cash flows arising from investing activities. For activities related to insurance business, including those related to unit linked funds, cash flows arising from the sale and purchase of debt securities and equity securities and interests in pooled investment funds are classified as cash flows arising from operating activities.
From 1 January 2019 the Group has changed the classification of capital flows arising to/from, and distributions paid to, third party interest in consolidated funds from cash flows arising from financing activities to cash flows arising from operating activities. Comparatives have been restated. Refer basis of preparation.
Purchases and sales of financial investments are presented on a gross basis except for purchases and sales of short-term instruments held in consolidated liquidity funds which are presented on a net basis.
Dividends received from associates and joint ventures are presented as cash flows arising from operating activities.
The tables below provide further analysis of the balances in the statement of cash flows.
(a)���� Change in operating assets
| � | 2019 | 2018 |
| � | �m | �m |
| Investment property | - | (303) |
| Equity securities and interests in pooled investment funds | 135 | 1,369 |
| Debt securities | (55) | 3,142 |
| Derivative financial instruments | (12) | 269 |
| Reinsurance assets | - | 328 |
| Receivables and other financial assets and other assets | 227 | (1,796) |
| Deferred acquisition costs | - | (13) |
| Loans | - | 27 |
| Assets held for sale | (137) | 250 |
| Change in operating assets | 158 | 3,273 |
(b)���� Change in operating liabilities
| � | 2019 | 2018 |
| � | �m | �m |
| Other financial liabilities, provisions and other liabilities | (230) | 1,260 |
| Deposits received from reinsurers | - | (397) |
| Pension and other post-retirement benefit provisions | (60) | (7) |
| Deferred income | (8) | 57 |
| Insurance contract liabilities | - | (586) |
| Investment contract liabilities | (316) | (2,756) |
| Change in liability for third party interest in consolidated funds | 197 | (622) |
| Liabilities held for sale | 126 | (76) |
| Change in operating liabilities | (291) | (3,127) |
(c)���� Other non-cash and non-operating items
| � | 2019 | 2018 |
| � | �m | �m |
| Gain on sale of subsidiaries | - | (1,780) |
| Profit on disposal of associates | (1,542) | (185) |
| Loss on disposal of property, plant and equipment | - | 1 |
| Depreciation of property, plant and equipment | 47 | 20 |
| Amortisation of intangible assets | 184 | 224 |
| Impairment losses on intangible assets | 1,571 | 926 |
| (Reversal of)/loss on impairment of associates | (243) | 228 |
| Impairment losses recognised on property, plant and equipment | 16 | - |
| Impairment losses on disposal group held for sale | - | 2 |
| Movement in contingent consideration asset/liability | (61) | - |
| Equity settled share-based payments | 43 | 36 |
| Other interest cost | - | 2 |
| Finance costs | 36 | 80 |
| Share of profit from associates and joint ventures accounted for using the equity method | (79) | (135) |
| Other non-cash and non-operating items | (28) | (581) |
�
(d)���� Disposal of subsidiaries
| � | � | � | 2018 |
| � | Notes | � | �m |
| Deferred acquisition costs | � | � | 622 |
| Investment property | � | � | 10,068 |
| Reinsurance assets | � | � | 4,474 |
| Derivative financial assets | � | � | 2,969 |
| Equity securities and interests in pooled investment funds | � | � | 96,351 |
| Debt securities | � | � | 56,712 |
| Receivables and other financial assets | � | � | 1,162 |
| Other assets of operations disposed of excluding cash and cash equivalents | � | � | 8,086 |
| Non-participating insurance contract liabilities | | | (22,207) |
| Non-participating investment contract liabilities | � | � | (102,216) |
| Participating contract liabilities | � | � | (30,244) |
| Deposits received from reinsurers | � | � | (4,236) |
| Derivative financial liabilities | � | � | (957) |
| Third party interest in consolidated funds | � | � | (15,581) |
| Other financial liabilities | � | � | (2,861) |
| Other liabilities of operations disposed of | � | � | (790) |
| Non-controlling interests - ordinary shares | � | � | (282) |
| Net assets disposed of | � | � | 1,070 |
| Items transferred to profit or loss on disposal of subsidiaries | 1 | � | (43) |
| Gain on sale | 1 | � | 1,780 |
| Transaction and separation costs | 1 | � | 117 |
| Deferred income recognised | | � | 78 |
| Non-cash consideration - Phoenix shares | � | � | (1,023) |
| Contingent consideration asset recognised | � | � | (8) |
| Total cash consideration | � | � | 1,971 |
| Cash and cash equivalents disposed of | � | � | (7,472) |
| Cash outflow from disposal of subsidiary | 1 | � | (5,501) |
There were no operations disposed of in the year ended 31 December 2019.�������������������������������������������
The following table reconciles the movement in subordinated liabilities in the year, split between cash and non-cash items.
| � | 2019 | 2018 |
| � | �m | �m |
| Opening balance carried forward | 1,081 | 2,253 |
| Effect of change in accounting policy to IFRS 91 | 5 | - |
| Opening balance at 1 January | 1,086 | 2,253 |
| | � | � |
| Cash flows from financing activities | � | � |
| Repayment of subordinated liabilities | (455) | (363) |
| Proceeds of issue of subordinated liabilities | - | (4) |
| Interest paid | (39) | (117) |
| Cash flows from financing activities | (494) | (484) |
| Non-cash items | � | � |
| Amounts reclassified to equity | - | (803) |
| Interest expense | 35 | 91 |
| Transfer to profit or loss on redemption of subordinated liabilities | 47 | - |
| Amortisation | - | 1 |
| Foreign exchange adjustment | (19) | 23 |
| At 31 December | 655 | 1,081 |
1��� The Group has initially applied IFRS 9 at 1 January 2019. Under the transition method chosen, comparative information is not restated. Refer Basis of preparation.
In addition to the repayment of subordinated liabilities of �363m during the year ended 31 December 2018, an additional �1,014m was redeemed from equity in the same period.
The following table reconciles the movement in lease liabilities in the year, split between cash and non-cash items.
| � | 2019 |
| � | �m |
| Opening balance carried forward | - |
| Effect of change in accounting policy to IFRS 161 | 227 |
| Opening balance at 1 January | 227 |
| | � |
| Cash flows from financing activities | � |
| Payment of lease liabilities | (32) |
| Cash flows from financing activities | (32) |
| Non-cash items | � |
| Additions | 74 |
| Disposals | (5) |
| Interest capitalised | 7 |
| Foreign exchange adjustment | (3) |
| At 31 December | 268 |
1��� The Group has initially applied IFRS 16 at 1 January 2019. Under the transition method chosen, comparative information is not restated. Refer Basis of preparation.
Contingent liabilities are possible obligations of the Group of which timing and amount are subject to significant uncertainty. Contingent liabilities are not recognised on the consolidated statement of financial position but are disclosed, unless they are considered remote. If such an obligation becomes probable and the amount can be measured reliably it is no longer considered contingent and is recognised as a liability.
Conversely, contingent assets are possible benefits to the Group. Contingent assets are only disclosed if it is probable that the Group will receive the benefit. If such a benefit becomes virtually certain it is no longer considered contingent and is recognised as an asset.
The Group is subject to regulation in all of the territories in which it operates insurance and investment businesses. In the UK, where the Group primarily operates, the FCA has broad powers, including powers to investigate marketing and sales practices.
The Group, like other financial organisations, is subject to legal proceedings, complaints and regulatory discussions, reviews and challenges in the normal course of its business. All such material matters are periodically reassessed, with the assistance of external professional advisers where appropriate, to determine the likelihood of the Group incurring a liability. Where it is concluded that it is more likely than not that a material outflow will be made a provision is established based on management's best estimate of the amount that will be payable. In some cases it will not be possible to form a view, for example because the facts are unclear or because further time is needed to properly investigate, and no provisions are held for such matters. It is not possible to predict with certainty the extent and timing of the financial impact of legal proceedings, complaints and related regulatory matters.
Refer Note 40 relating to ongoing discussions with Phoenix in respect of disagreements over the operation of certain aspects of the agreements that were entered into at the time of the sale of the UK and European insurance business to Phoenix and which impact the value of indemnities and other related payments under the transaction terms.
The Group has contractual commitments in respect of expenditure on investment property, funding arrangements and leases which will be payable in future periods. These commitments are not recognised on the Group's statement of financial position at the year end but are disclosed to give an indication of the Group's future committed cash flows.
As at 31 December 2019, the Group has committed to investing an additional �46m (2018: �37m) into funds in which it holds a co-investment interest.
As at 31 December 2019, the Group has no capital commitments other than in relation to financial instruments (2018: none).
The Group's investment property was sold in the year ended 31 December 2018 so there are no capital commitments in respect of investment property as at 31 December 2019 and 31 December 2018.
The Group operates share incentive plans for its employees. These generally take the form of an award of options or shares in Standard Life Aberdeen plc (equity-settled share-based payments) but can also take the form of a cash award based on the share price of Standard Life Aberdeen plc (cash-settled share-based payments). The Group also incentivises certain employees through the award of units in Group managed funds (deferred fund awards) which are cash-settled. All the Group's incentive plans have conditions attached before the employee becomes entitled to the award. These can be performance and/or service conditions (vesting conditions) or the requirement of employees to save in the save-as-you-earn scheme (non-vesting condition). The period over which all vesting conditions are satisfied is the vesting period and the awards vest at the end of this period.
For all share-based payments services received for the incentive granted are measured at fair value.
For cash-settled share-based payment and deferred fund awards transactions, services received are measured at the fair value of the liability. The fair value of the liability is remeasured at each reporting date and any changes in fair value are recognised in the consolidated income statement.
For equity-settled share-based payment transactions, the fair value of services received is measured by reference to the fair value of the equity instruments at the grant date. The fair value of the number of instruments expected to vest is charged to the income statement over the vesting period with a corresponding credit to the equity compensation reserve in equity.
At each period end the Group reassesses the number of equity instruments expected to vest and recognises any difference between the revised and original estimate in the consolidated income statement with a corresponding adjustment to the equity compensation reserve.
Replacement share-based payment awards granted in a business combination are included in determining the consideration transferred. The amount included is calculated by reference to the pre-combination service and the market-measure of the replaced awards.
At the time the equity instruments vest, the amount recognised in the equity compensation reserve in respect of those equity instruments is transferred to retained earnings.
During the year ended 31 December 2019, the Group made the majority of its awards under the new Standard Life Aberdeen plc Deferred Share and Standard Life Aberdeen plc Discretionary Share Plans both of which were established in 2018. The awards made under these plans in the year ended 31 December 2019 were either share options, conditional share awards or deferred fund awards.
With the exception of Sharesave and the share incentive plan, no new awards were made under the previous plans during the year ended 31 December 2019.
The following plans issued share options during the year ended 31 December 2019.
(i)����� Deferred and discretionary share plans
The Group operates the following deferred and discretionary plans.
| Plan | Recipients | Conditions which must be met prior to vesting |
| Standard Life Aberdeen plc Deferred Share Plan | Executives and senior management | Service, or service and performance conditions. These can be tailored to the individual award |
| Standard Life Aberdeen plc Discretionary Share Plan | Executives and senior management | Service, or service and performance conditions. These can be tailored to the individual award |
All of the awards made under these plans are equity-settled except for a small number of cash-settled awards.
The awards made under these plans include awards for deferred bonuses of the prior year. With the exception of the Executive Incentive Plan (EIP) awards, these awards have service conditions of one, two and three years after the date of the award and no outstanding performance conditions. The awards for deferred bonus for executive directors are made under the conditions of the EIP including a performance underpin. Further details of the EIP are set out in the Directors' remuneration report.
The Group operates Save-as-you-earn (SAYE) plans, which allow eligible employees in the UK and Ireland the opportunity to save a monthly amount from their salaries, over either a three or five year period, which can be used to purchase shares in the Company. The shares can be purchased at the end of the savings period at a predetermined price. Employees are granted a predetermined number of options based on the monthly savings amount and duration of their contract. The conditions attached to the options are that the employee remains in employment for three years after the grant date of the options and that the employee satisfies the monthly savings requirement. Settlement is made in the form of shares.
In addition to the above, the following plans issued no share options during the year ended 31 December 2019 but have outstanding options.
The Group operates the following long-term incentive plans which awarded share options prior to the introduction of the Standard Life Aberdeen plc Deferred Share and Discretionary Share Plans.
| Plan | Recipients | Conditions which must be met prior to vesting |
| Standard Life Long-Term Incentive Plan (Standard Life LTIP) | Executives and senior management | Service and performance conditions as set out in the Directors' remuneration report |
| Standard Life Investments Long-Term Incentive Plan (Standard Life Investments LTIP) | Executives and senior management | Service and performance conditions as set out in the Directors' remuneration report |
| Standard Life Restricted stock plan (Standard Life RSP) | Executives (other than executive Directors) and senior management | Service, or service and performance conditions. These are tailored to the individual award |
All of the awards are equity-settled other than awards made under the Standard Life Investments LTIP in respect of employees in the US, France and Asia which are cash-settled.
(iv)��� Annual bonus deferred share options
The Group operates the following deferred bonus plans which awarded share options prior to the introduction of the Standard Life Aberdeen plc Deferred Share and Discretionary Share Plans.
| Plan | Recipients | Conditions which must be met prior to vesting |
| Short-term incentive plan (Standard Life Group STIP) | Executives and senior management | Service and performance conditions as set out in the Directors' remuneration report. There are no outstanding performance conditions. |
| Aberdeen Asset Management Deferred Share Plan 2009 (Aberdeen Asset Management DSP 2009) | Executives and senior management | Service conditions of one, two and three years after the date of the award (one to five years for executive management). There are no outstanding performance conditions. |
The following plans issued other share awards during the year ended 31 December 2019.
(i)����� Deferred and discretionary share plans
In addition to the share options above, conditional share awards are also made under the Standard Life Aberdeen plc Deferred Share Plan and Standard Life Aberdeen plc Discretionary Share Plan. The awards are similar in nature to the share options under these plans except that unlike share options which have an exercise period, conditional shares awarded have no exercise period and the employee receives the shares at the end of the award's vesting period. Conditional share awards are made to employees in a number of overseas locations including the US, Denmark and the Netherlands.
(ii)���� Share incentive plan
The Group operates a share incentive plan, allowing employees the opportunity to buy shares from their salary each month. The maximum purchase that an employee can make in any year is �1,800. The Group offers to match the number of shares bought up to a value of �50 each month. The matching shares awarded under the share incentive plan are granted at the end of each month. The matching shares are generally subject to a three year service period.
In addition to the above, the following plan issued no share awards during the year ended 31 December 2019 but has outstanding awards.
(iii)��� Annual bonus deferred share awards
The Group operates the following deferred bonus plan which awarded conditional shares prior to the introduction of the Standard Life Aberdeen plc Deferred Share and Discretionary Share Plans.
| Plan | Recipients | Conditions which must be met prior to vesting |
| Aberdeen Asset Management USA Deferred Share Award Plan (Aberdeen Asset Management USA DSAP) | US based executives and senior management | Service conditions of one, two and three years after the date of the award (one to five years for executive management). There are no outstanding performance conditions. |
Unlike share options under the Aberdeen Asset Management DSP 2009 which have an exercise period, conditional shares awarded under the Aberdeen Asset Management USA DSAP have no exercise period and the employee receives the shares at the end of the award's vesting period.
Employees may forfeit some or all of share options or awards made under any of the above share-based payment schemes if they leave the Group prior to the end of the awards' vesting periods.
The number, weighted average exercise price and weighted average remaining contractual life for options outstanding during the year are as follows:
| 2019 | Deferred and discretionary share plans | Long-term | RSP | Annual bonus deferred share options | Sharesave | Weighted average exercise price for Sharesave |
| Outstanding at 1 January | - | 55,702,777 | 6,562,186 | 26,220,720 | 9,260,389 | 292p |
| Granted | 23,636,874 | - | - | - | 5,473,382 | 199p |
| Forfeited | (257,360) | (18,310,221) | (1,693,033) | (651,976) | - | - |
| Exercised | (423,356) | (952,703) | (2,855,702) | (10,099,285) | (353,534) | 282p |
| Expired | - | (28,050) | (15,555) | - | - | - |
| Cancelled | - | - | - | - | (6,510,173) | 294p |
| Outstanding at 31 December | 22,956,158 | 36,411,803 | 1,997,896 | 15,469,459 | 7,870,064 | 227p |
| Exercisable at 31 December | 35,295 | - | 89,798 | 10,357,995 | 426,840 | 285p |
| Remaining contractual life of options outstanding (years)1 | 9.29 | 1.22 | 1.17 | 5.99 | 3.29 | � |
�
| 2018 | Long-term incentive plans (excluding RSP) | RSP | Annual bonus deferred share options | Sharesave | Weighted average exercise price for Sharesave |
| Outstanding at 1 January | 52,005,776 | 7,104,089 | 28,216,634 | 9,004,370 | 316p |
| Granted | 20,476,434 | 1,460,199 | 3,434,492 | 3,712,915 | 257p |
| Forfeited | (10,979,340) | (437,714) | (312,312) | (807,186) | 309p |
| Exercised | (5,800,093) | (1,564,388) | (5,118,094) | (680,119) | 287p |
| Cancelled | - | - | - | (1,969,591) | 328p |
| Outstanding at 31 December | 55,702,777 | 6,562,186 | 26,220,720 | 9,260,389 | 292p |
| Exercisable at 31 December | - | 20,152 | 9,816,708 | 2,292,876 | 313p |
| Remaining contractual life of options outstanding (years)1 | 1.96 | 1.38 | 7.10 | 2.65 | � |
1��� Weighted average.
The exercise price for options granted under the deferred and discretionary share plans, the long-term incentive plans (including RSP) and the annual bonus deferred share option schemes is nil. The fair value of options granted under the Group's incentive schemes is determined using a relevant valuation technique, such as the Black Scholes option pricing model.
The following table shows the weighted average assumptions that were considered in determining the fair value of options granted during the year.
| � | Deferred and discretionary share plans | Sharesave |
| Options granted during the year | � | � |
| Grant date | Throughout, main grant date 15 April 2019 | 16 October 2019 |
| Share price at grant date1 | 272p | 285p |
| Fair value at grant date1 | 272p | 54p |
| Exercise price | Nil | 192p-199p |
| Dividends | The plans include the entitlement to the receipt of dividends in respect of awards that ultimately vest between the date of grant and the vesting date | No dividend entitlement |
| Option term (years)1 | 2.77 | 3.53 |
1��� Weighted average.
No departures from share option schemes are expected at grant date, with any leavers being accounted for on departure. In determining the fair value of options granted under the Sharesave scheme the historic volatility of the share price over a period of up to five years and a risk free rate determined by reference to swap rates was also considered.
The following table shows the share price at exercise of options exercised during the year.
| � | Deferred and discretionary share plans | Long-term incentive plans (excluding RSP) | RSP | Annual bonus deferred share options | Sharesave |
| Options exercised during the year | � | � | � | � | � |
| Share price at time of exercise1 | 275p | 268p | 252p | 271p | 305p |
1��� Weighted average.
The following table shows the range of exercise prices of options outstanding at 31 December 2019. Options under the Standard Life Aberdeen plc Deferred Share and Standard Life Aberdeen plc Discretionary Share Plans and the Aberdeen Asset Management DSP 2009 are exercisable up to 10 years after the grant date. All other options are exercisable for a period of six months after the vesting date.
| � | 2019 | 2018 |
| � | Number of options outstanding | Number of options outstanding |
| Deferred and discretionary share plans | � | � |
| �nil | 22,956,158 | - |
| Long-term incentive plans | � | � |
| �nil | 38,409,699 | 62,264,963 |
| Annual bonus deferred share options | � | � |
| �nil | 15,469,459 | 26,220,720 |
| Sharesave | � | � |
| 192p-199p | 5,442,217 | - |
| 200p-327p | 1,711,180 | 6,102,619 |
| 328p-402p | 716,667 | 3,157,770 |
| Outstanding at 31 December | 84,705,380 | 97,746,072 |
(b) ��� Other share plans
| � | 2019 | 2018 | ||
| � | Deferred and discretionary share plans | Share incentive �plan | Annual bonus deferred share awards1 | Share incentive �plan2 |
| Number of share awards granted | 4,283,186 | 348,461 | 285,500 | 562,261 |
| Share price at date of grant3 | 272p | 277p | 364p | 336p |
| Fair value per granted instrument at grant date3 | 272p | 277p | 364p | 336p |
1��� Conditional share awards made under the Aberdeen Asset Management USA DSAP.
2��� The share incentive plan awards in the year ended 31 December 2018 included 5,898 rights to shares granted to eligible employees in Germany and Austria.
3��� Weighted average.
No conditional share awards were made under the Aberdeen Asset Management USA DSAP in the year ended 31 December 2019.
At the grant date all awards are expected to vest. No departures are expected at the grant date, with leavers being accounted for on departure. The plans include the entitlement to the receipt of dividends in respect of awards that ultimately vest between the date of grant and the vesting date.
The amounts recognised as an expense for equity-settled share-based payment transactions and deferred fund awards with employees are as follows:
| � | 2019 | 2018 |
| � | �m | �m |
| Share options and share awards granted under deferred and discretionary share plans1 | 36 | 33 |
| Share options granted under long-term incentive plans | 4 | - |
| Share options granted under Sharesave | 2 | 2 |
| Matching shares granted under share incentive plans | 1 | 1 |
| Equity-settled share-based payments | 43 | 36 |
| Cash-settled deferred fund awards | 10 | 9 |
| Total expense | 53 | 45 |
1��� Includes expense for annual bonus deferred share awards.
Included in the expense above is �19m (2018: �31m) of share-based payment expenses which are included in restructuring and corporate transaction expenses in the consolidated income statement.
The liability for cash-settled share-based payments outstanding at 31 December 2019 is �nil (2018: �2m).
Deferred fund awards
At 31 December 2019, the liability recognised for cash-settled deferred fund awards was �46m (2018: �48m).
(a)���� Transactions and balances with related parties
In the normal course of business, the Group enters into transactions with related parties that relate to insurance and asset management business.
During the year, the Group recognised management fees from Group managed non-consolidated investment vehicles. These fees are disclosed in Note 39. It also recognised management fees of �4m (2018: �4m) from the Group's defined benefit pension plans.
In the year ended 31 December 2019, for associates accounted for using the equity method, the Group recognised sales primarily in relation to management fees of �145m (2018: �89m) and purchases in relation to services received of �49m (2018: �28m).
In the year ended 31 December 2019 there were sales to joint ventures of �1m (2018: �nil) and purchases from joint ventures of �1m (2018: �nil).
In addition to these transactions between the Group and related parties during the year, in the normal course of business the Group made a number of investments into/divestments from investment vehicles managed by the Group including investment vehicles which are classified as investments in associates measured at FVTPL. Group entities paid amounts for the issue of shares or units and received amounts for the cancellation of shares or units.
The Group had balances due from associates accounted for using the equity method of �55m (2018: �63m), balances due to associates accounted for using the equity method of �22m (2018: �19m) and no balances due to or from joint ventures as at 31 December 2019 (2018: none). The Group's defined benefit pension plans have assets of �1,154m (2018: �1,132m) invested in investment vehicles managed by the Group.
Details of a proposed sale of a subsidiary to a joint venture are included in Note 23.
On 24 May 2019 the executive committee was replaced by the executive leadership team. For 2019 key management personnel therefore includes Directors of Standard Life Aberdeen plc (since appointment) and the executive committee (since appointment) for the period from 1 January 2019 until 23 May 2019 and from 24 May 2019 includes Directors of Standard Life Aberdeen plc (since appointment) and the members of the executive leadership team (since appointment).
In 2018 key management personnel included Directors of Standard Life Aberdeen plc (since appointment) and the Chief Executive Officer Pensions and Savings for the period from 1 January 2018 until 31 August 2018 and from 1 September 2018 included Directors of Standard Life Aberdeen plc and the members of the executive committee (since appointment).
The summary of compensation of key management personnel is as follows:
| � | 2019 | 2018 |
| � | �m | �m |
| Salaries and other short-term employee benefits | 8 | 6 |
| Post-employment benefits | - | - |
| Share-based payments and deferred fund awards | 7 | 6 |
| Termination benefits | 1 | - |
| Total compensation of key management personnel | 16 | 12 |
Certain members of key management personnel hold investments in investments products which are managed by the Group. None of the amounts concerned are material in the context of funds managed by the Group. All transactions between key management and their close family members and the Group during the year are on terms which are equivalent to those available to all employees of the Group.
(a) ��� Capital and risk management policies and objectives
Managing capital is the ongoing process of determining and maintaining the quantity and quality of capital appropriate for the Group and ensuring capital is deployed in a manner consistent with the expectations of our stakeholders. For these purposes, the Board considers our key stakeholders to be our clients, the providers of capital (our equity holders and holders of our subordinated liabilities) and the Financial Conduct Authority (FCA) as the lead prudential supervisor for the Group.
There are two primary objectives of capital management within the Group. The first objective is to ensure that capital is, and will continue to be, adequate to maintain the required level of financial stability of the Group and hence to provide an appropriate degree of security to our stakeholders. The second objective is to create equity holder value by driving profit attributable to equity holders.
The liquidity and capital management policy forms one element of the Group's overall management framework. Most notably, it operates alongside and complements the strategic investment policy and the Group risk policies. Integrating policies in this way enables the Group to have a capital management framework that robustly links the process of capital allocation, value creation and risk management.
Capital requirements are forecast on a periodic basis and assessed against the forecast available capital resources. In addition, internal rates of return achieved on capital invested are assessed against hurdle rates, which are intended to represent the minimum acceptable return given the risks associated with each investment. The capital planning process is the responsibility of the Chief Financial Officer. Capital plans are ultimately subject to approval by the Board.
The formal procedures for identifying and assessing risks that could affect the capital position of the Group are described in the Risk management section of the Strategic report on page 44. Information on financial instruments risk is also provided in Note 38.
(b)(i) Regulatory capital framework
From 31 August 2018, following the sale of the UK and European insurance business to Phoenix, the Group is supervised under the CRD IV regulatory regime for group prudential supervisory purposes and therefore measures and monitors its capital on that basis. Previously, the Group was subject to the Solvency II (SII) regulatory regime. The Group's regulatory capital position under CRD IV is determined by consolidating the eligible capital and reserves of the Group (subject to a number of deductions) to derive regulatory capital resources, and comparing this to the Group's regulatory capital requirements.
Stress testing is completed to determine the appropriate level of regulatory capital and liquidity that the Group must hold, with results shared with the FCA at least annually. In addition, the Group monitors a range of capital and liquidity statistics on a daily, monthly or less frequent basis as required. Surplus capital levels are forecast, taking account of projected dividends and investment requirements, to ensure that appropriate levels of capital resources are maintained.
The Group is required to hold capital resources to cover both Pillar 1 and Pillar 2 capital requirements, described below.
Pillar 1 - minimum requirement for capital
Pillar 1 focuses on fixed overhead requirements and the Group's exposure to credit and market risks in respect of risk-weighted assets, and sets a minimum requirement for capital based on these measures. At 31 December 2019, the Group's draft Pillar 1 minimum requirement for capital was �0.4bn (2018: �0.3bn).
Pillar 2 - ICAAP and supervisory review and evaluation process
Pillar 2 supplements the Pillar 1 minimum requirement via the ICAAP, which is the means by which the Group assesses the level of capital that adequately supports all of the relevant current and future risks in its business. The ICAAP focuses on the principal risks to the consolidated financial position and examines each risk category to identify exposures that could put the Group's capital at risk. The results of the Group's ICAAP process will be subject to periodic review by the FCA under the Supervisory Review and Evaluation Process (SREP).
| � | 20191 | 20181 |
| � | �bn | �bn |
| IFRS equity attributable to equity holders of Standard Life Aberdeen plc | 6.6 | 7.4 |
| Deductions for intangibles and defined benefit pension assets, net of related deferred tax liabilities | (2.9) | (4.5) |
| Deductions for significant investments in financial sector entities | (1.1) | (1.3) |
| Other deductions and adjustments, including provision for foreseeable dividend | (0.4) | (0.5) |
| Common Equity Tier 1 capital resources | 2.2 | 1.1 |
| Tier 2 capital resources | 0.6 | 0.6 |
| Total regulatory capital resources | 2.8 | 1.7 |
| Total regulatory capital requirements | (1.1) | (1.1) |
| Surplus regulatory capital | 1.7 | 0.6 |
1��� 2019 draft position on 10 March 2020 following finalisation of the Annual report and accounts, 2018 based on Pillar 3 reporting.
The Group has complied with all externally imposed capital requirements during the year. The Group's Pillar 3 disclosures will be published on the Group's website at www.standardlifeaberdeen.com/annualreport.
On 7 February 2020, the Company announced a share buyback of up to �400m through on-market purchases commencing on 10 February 2020 and ending no later than 30 September 2020. As at 6 March 2020, the Company had repurchased 20,214,403 shares for a consideration of �60m.
In early 2020, the existence of a new coronavirus, now known as COVID-19, was confirmed and since this time COVID-19 has spread across China and to a significant number of other countries. COVID-19 has caused disruption to businesses and economic activity which has been reflected in recent fluctuations in global stock markets. The Group considers the emergence and spread of COVID-19 to be a non-adjusting post balance sheet event. Given the inherent uncertainties, it is not practicable at this time to determine the impact of COVID-19 on the Group or to provide a quantitative estimate of this impact.
Our assessment of the recoverable amount of asset management goodwill and consideration of indicators of impairment relating to other intangibles was based on economic conditions, including equity market levels, at 31 December 2019.� At the year end the carrying amount of asset management goodwill is the recoverable amount so any downside sensitivity will lead to a future further impairment loss.� COVID-19 could lead to continued lower equity market levels and reduced gross inflows and therefore reduced future revenues and future cash flows.� Note 15 provides sensitivities which include the impact of reductions in forecast cash flows on the recoverable amount of asset management goodwill.
48.�� Related undertakings
The Companies Act 2006 requires disclosure of certain information about the Group's related undertakings which is set out in this note. Related undertakings are subsidiaries, joint ventures, associates and other significant holdings. In this context significant means either a shareholding greater than or equal to 20% of the nominal value of any class of shares, or a book value greater than 20% of the Group's assets.
The particulars of the Company's related undertakings at 31 December 2019 are listed below. For details of the Group's consolidation policy refer to (b) Basis of consolidation in the Presentation of consolidated financial statements section. Under that policy limited partnerships in which the Group has no interest but whose general partner is controlled by the Group are not consolidated. However such limited partnerships are considered to be related undertakings under Companies Act 2006 and therefore are listed below. Where the Group has no interest in a limited partnership that is considered a related entity, the interest held is disclosed as 0%.
The ability of subsidiaries to transfer cash or other assets within the Group for example through payment of cash dividends is generally restricted only by local laws and regulations, and solvency requirements. Included in equity attributable to equity holders of Standard Life Aberdeen plc at 31 December 2019 is �88m (2018: �81m) related to the Standard Life Foundation, a subsidiary undertaking of the Group. The assets of the Standard Life Foundation are restricted to be used for charitable purposes. Additionally dividends payable on Aberdeen's preference shares rank ahead of any dividends paid on Aberdeen's ordinary shares.
The registered head office of all related undertakings is 1 George Street, Edinburgh, EH2 2LL unless otherwise stated.
(a) ��� Direct subsidiaries
| Name of related undertaking | � | Share class1 | % interest held2 |
| 1825 Financial Planning Limited3 | � | Ordinary shares | 100% |
| 30 STMA 1 Limited5 | � | Ordinary shares | 100% |
| 30 STMA 2 Limited5 | � | Ordinary shares | 100% |
| 30 STMA 3 Limited5 | � | Ordinary shares | 100% |
| 30 STMA 4 Limited5 | � | Ordinary shares | 100% |
| 30 STMA 5 Limited5 | � | Ordinary shares | 100% |
| Aberdeen Asset Management PLC4 | � | Ordinary shares | 100% |
| Focus Solutions Group Limited6 | � | Ordinary shares | 100% |
| Standard Life Aberdeen Trustee Company Limited | � | Ordinary shares | 100% |
| Standard Life (Asia Pacific Holdings) Private Limited8 | � | Ordinary shares | 100% |
| Standard Life Charity Fund | � | N/A | 100% |
| Standard Life Client Management Limited | � | Ordinary shares | 100% |
| Standard Life Employee Services Limited | � | Ordinary shares | 100% |
| Standard Life Finance Limited | � | Ordinary shares | 100% |
| Standard Life Foundation | � | N/A | 100% |
| Standard Life Investments (Holdings) Limited | � | Ordinary shares | 100% |
| Standard Life (London) Limited5 | � | Ordinary shares | 100% |
| Standard Life (Mauritius Holdings) 2006 Limited9 | � | Ordinary shares | 100% |
| Standard Life Oversea Holdings Limited | � | Ordinary shares | 100% |
| Standard Life Savings Limited | � | Ordinary shares | 100% |
| The Standard Life Assurance Company 2006 | � | N/A | 100% |
| Threesixty Services LLP10 | � | Limited liability partnership | 100% |
| Threesixty Support LLP10 | � | Limited liability partnership | 100% |
(b) ��� Other subsidiaries, joint ventures, associates and other significant holdings
| Name of related undertaking | � | Share class1 | % interest held2 | � | ||||||||||||
| 1825 Financial Planning and Advice Limited3 | � | Ordinary A shares | 100% | � | ||||||||||||
| 21 Aberdeen Standard Investments Limited5 | � | Ordinary shares | 50% | � | ||||||||||||
| 21ASI Long Term Fund I SCSp11 | � | Limited partnership | 0% | � | ||||||||||||
| 6 SAS 1 Limited | � | Ordinary shares | 100% | � | ||||||||||||
| 6 SAS 2 Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen ACM Team LP4 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen ACP LLP4 | � | Limited liability partnership | 100% | � | ||||||||||||
| Aberdeen Alternatives (Holdings) Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Asia IV (General Partner) S.a.r.l.12 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Asia Pacific Fund (Offshore), L.P.13 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Asia Pacific Fund II (Offshore), L.P.13 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Asia Pacific Fund II, L.P.13 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Asia Pacific Fund, L.P.13 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Asia Pacific III Ex-Co-Investment (Offshore), L.P.13 | � | Limited partnership | 0% | � | ||||||||||||
| Name of related undertaking | � | Share class1 | % interest held2 | � | ||||||||||||
| Aberdeen Asia Pacific III Ex-Co-Investment, L.P.13 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Asia Pacific III, L.P.13 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen ASIF Carry LP4 | � | Limited partnership | 25% | � | ||||||||||||
| Aberdeen Asset Investment Group Limited5 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Asset Investments Limited5 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Asset Management Cayman Limited13 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Asset Management Denmark A/S14 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Asset Management Finland Oy15 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Asset Management Sweden AB16 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Asset Management US GP Control LLC17 | � | Limited liability company | 100% | � | ||||||||||||
| Aberdeen Asset Managers (Luxembourg) S.a.r.l. 18 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Asset Managers Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Asset Middle East Limited19 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Capital Management LLC20 | � | Limited liability company | 100% | � | ||||||||||||
| Aberdeen Capital Managers GP LLC21 | � | Limited liability company | 100% | � | ||||||||||||
| Aberdeen Claims Administration, Inc. 22 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Co-Investment Mandate LP4 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Direct Property (Holding) Limited5 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen do Brasil Gestao de Recursos Ltda23 | | Limited liability company | 100% | � | ||||||||||||
| Aberdeen Emerging Asia Fund, L.P.13 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Emerging Asia Pacific II (Offshore), L.P.13 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Emerging Asia Pacific III Ex-Co-Investments, L.P.13 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Emerging Capital Limited24 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Energy & Resource Company IV, LLC25 | � | Limited liability company | 73% | � | ||||||||||||
| Aberdeen Energy & Resources Partners IV, L.P. 25 | � | Limited partnership | 1% | � | ||||||||||||
| Aberdeen European Infrastructure Carry GP Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen European Infrastructure Carry Limited4 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen European Infrastructure Co-Invest II LP5 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen European Infrastructure GP II Limited5 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen European Infrastructure GP III Limited5 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen European Infrastructure GP Limited5 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen European Infrastructure Partners Carry II LP4 | � | Limited partnership | 25% | � | ||||||||||||
| Aberdeen European Infrastructure Partners Carry LP4 | � | Limited partnership | 25% | � | ||||||||||||
| Aberdeen European Infrastructure Partners II LP11 | � | Limited partnership | 3% | � | ||||||||||||
| Aberdeen European Infrastructure Partners III LP | � | Limited partnership | 1% | � | ||||||||||||
| Aberdeen European Infrastructure Partners LP4 | � | Limited partnership | 3% | � | ||||||||||||
| Aberdeen European Residential Opportunities Fund SCSp26 | � | Limited partnership | 1% | � | ||||||||||||
| Aberdeen France S.A.27 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Fund Distributors LLC22 | � | Limited liability company | 100% | � | ||||||||||||
| Aberdeen Fund Management II Oy15 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Fund Management Ireland Limited28 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Fund Management Oy15 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen General Partner 1 Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen General Partner 2 Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen General Partner CAPELP Limited13 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen General Partner CGPLP Limited13 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen General Partner CMENAPELP Limited13 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen General Partner CPELP II Limited13 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen General Partner CPELP Limited13 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Global Absolute Return Strategies Fund5 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Global ex-Japan FoF's LP13 | � | Limited partnership | 6% | � | ||||||||||||
| Aberdeen Global ex-Japan GP Limited13 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Global Infrastructure Carry GP Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Global Infrastructure GP II Limited29 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Global Infrastructure GP Limited29 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Global Infrastructure Partners Carry LP4 | � | Limited partnership | 25% | � | ||||||||||||
| Aberdeen Global Infrastructure Partners II Carry LP4 | � | Limited partnership | 25% | � | ||||||||||||
| Aberdeen Global Infrastructure Partners II LP4 | � | Limited partnership | 0% | � | ||||||||||||
| Name of related undertaking | � | Share class1 | % interest held2 | � | ||||||||||||
| Aberdeen Global Infrastructure Partners LP5 | � | Limited partnership | 1% | � | ||||||||||||
| Aberdeen GP 1 LLP4 | � | Limited liability partnership | 100% | � | ||||||||||||
| Aberdeen GP 2 LLP4 | � | Limited liability partnership | 100% | � | ||||||||||||
| Aberdeen GP 3 LLP4 | � | Limited liability partnership | 100% | � | ||||||||||||
| Aberdeen Infrastructure Feeder GP Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Infrastructure Finance GP Limited29 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Infrastructure GP II Limited5 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Infrastructure Partners Carry LP4 | � | Limited partnership | 25% | � | ||||||||||||
| Aberdeen Infrastructure Partners II Carry LP4 | � | Limited partnership | 25% | � | ||||||||||||
| Aberdeen Infrastructure Partners II LP4 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Infrastructure Partners LP Inc30 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Institutional Commingled Funds LLC - Long Duration Corporate Bond Fund25 | � | Unit trust | 100% | � | ||||||||||||
| Aberdeen Investment Company Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Investment Solutions Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Investments Euro Limited5 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Investments Jersey Limited31 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Investments Limited5 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Investments USD Limited5 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Keva Asia IV Property Partners SCSP12 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Liquidity Fund (Lux) | � | � | � | � | ||||||||||||
| Seabury Sterling Liquidity 1 Fund26 | � | SICAV | 100% | � | ||||||||||||
| Aberdeen Pension Trustees Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Pooling II GP AB16 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Property Fund Finland I Feeder Ky15 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Property Fund Finland LP (APFF)15 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Property Fund Limited Partner Oy15 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Property Fund Management (Jersey) Limited32 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Property Fund Management Estonia Ou33 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Property Investors (General Partner) S.a.r.l.34 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Property Investors Estonia Ou33 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Property Investors France SAS27 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Property Investors Limited Partner Oy15 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Property Investors The Netherlands BV35 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Property Secondaries Partners II26 | � | Limited partnership | 1% | � | ||||||||||||
| Aberdeen Property UK Retail Parks Partnership5 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Real Estate Fund Finland LP (AREFF)36 | � | Limited partnership | 5% | � | ||||||||||||
| Aberdeen Real Estate Investors Operations (UK) Limited24 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Real Estate Operations Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Residential JV Feeder Limited Partner Oy15 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Secondaries II GP S.a.r.l.26 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Sidecar LP Inc30 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen SP 2013 A/S14 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard 2019 European PE A Carry LP | � | Limited partnership | 100% | � | ||||||||||||
| Aberdeen Standard 2019 European PE B Carry LP | � | Limited partnership | 100% | � | ||||||||||||
| Aberdeen Standard Asset Management (Shanghai) Co., Ltd.37 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Asset Management (Thailand) Limited38 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Asset Management Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Bloomberg WTI Crude Oil Strategy K-1 Free ETF25 | � | ETF | 67% | � | ||||||||||||
| Aberdeen Standard Capital (CI) Limited39 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Capital International Limited39 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Capital Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Carlsbad GP Limited29 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Carlsbad LP4 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Standard Diversified Fixed Income Fund40 | � | OEIC | 22% | � | ||||||||||||
| Aberdeen Standard ECF II Carry Limited Partnership | � | Limited partnership | 100% | � | ||||||||||||
| Aberdeen Standard Emerging Market Local Currency Debt Fund40 | � | OEIC | 41% | � | ||||||||||||
| Aberdeen Standard European Co-Investment II SCSp26 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Standard Fund Managers Limited5 | � | Ordinary shares | 100% | � | ||||||||||||
| Name of related undertaking | � | Share class1 | % interest held2 | � | ||||||||||||
| Aberdeen Standard Global Infrastructure GP III Ltd.29 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Greater China Value Fund41 | � | Investment trust | 94% | � | ||||||||||||
| Aberdeen Standard Group Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Indonesia Balanced Growth Fund42 | � | Unit trust | 86% | � | ||||||||||||
| Aberdeen Standard Indonesia Bond Fund42 | � | Unit trust | 63% | � | ||||||||||||
| Aberdeen Standard Indonesia Equity Fund42 | � | Unit trust | 80% | � | ||||||||||||
| Aberdeen Standard Indonesia Money Market Fund42 | � | Unit trust | 33% | � | ||||||||||||
| Aberdeen Standard Investment Management Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments (Asia) Limited43 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Australia Limited40 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Beteiligungs GmbH44 | | Limited liability company | 94% | � | ||||||||||||
| Aberdeen Standard Investments (Canada) Limited45 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Charitable Foundation4 | � | N/A | 100% | � | ||||||||||||
| Aberdeen Standard Investments Churchill Square General Partner Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Colombia SAS46 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Deutschland AG44 | | Ordinary shares | 94% | � | ||||||||||||
| Aberdeen Standard Investments ETFs (US) LLC47 | � | Limited liability company | 100% | � | ||||||||||||
| Aberdeen Standard Investments ETFs Advisors LLC47 | � | Limited liability company | 100% | � | ||||||||||||
| Aberdeen Standard Investments ETFs Sponsor LLC47 | | Limited liability company | 100% | � | ||||||||||||
| Aberdeen Standard Investments Fund Management A/S48 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments (Holdings) Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments (Hong Kong) Limited49 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Inc. 22 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Ireland Limited50 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments (Japan) Limited51 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Korea Co. Ltd.52 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Life and Pensions Limited5 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Limited | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Luxembourg S.A.26 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments (Malaysia) Sdn. Bhd53 | | Ordinary shares, | 100% | � | ||||||||||||
| Aberdeen Standard Investments Nominees Services (HK) Limited49 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Norway AS48 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Norway Holding AS48 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Operations AS48 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments (Switzerland) AG54 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Investments Taiwan Limited41 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Islamic Asia Pacific Ex Japan Equity Fund55 | � | Unit trust | 49% | � | ||||||||||||
| Aberdeen Standard Islamic Investments (Malaysia) Sdn. Bhd.53 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Life Asset Management Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Life Group Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Life Investments Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Life Limited | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Limited | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen Standard Multi-Sector Private Credit Fund SCSp26 | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Standard OEIC I | | | | � | ||||||||||||
| ASI China A Share Equity Fund5 | � | OEIC | 98% | � | ||||||||||||
| ASI Japanese Equity Fund5 | � | OEIC | 80% | � | ||||||||||||
| ASI Sterling Long Dated Government Bond Fund5 | � | OEIC | 32% | � | ||||||||||||
| Aberdeen Standard OEIC III | � | � | � | � | ||||||||||||
| ASI MyFolio Index I Fund5 | | OEIC | 84% | � | ||||||||||||
| ASI MyFolio Index II Fund5 | � | OEIC | 21% | � | ||||||||||||
| ASI MyFolio Index V Fund5 | � | OEIC | 39% | � | ||||||||||||
| Aberdeen Standard OEIC IV | � | � | � | � | ||||||||||||
| ASI American Equity Tracker Fund5 | � | OEIC | 43% | � | ||||||||||||
| ASI Asia Pacific ex Japan Equity Tracker Fund5 | � | OEIC | 100% | � | ||||||||||||
| ASI Emerging Markets Equity Tracker Fund5 | � | OEIC | 76% | � | ||||||||||||
| Name of related undertaking | � | Share class1 | % interest held2 | |||||||||||||
| ASI European Equity Tracker Fund5 | � | OEIC | 69% | |||||||||||||
| ASI Global Inflation-Linked Bond Tracker Fund5 | � | OEIC | 43% | |||||||||||||
| ASI Japan Equity Tracker Fund5 | � | OEIC | 74% | |||||||||||||
| ASI Short Dated Global Corporate Bond Tracker Fund5 | � | OEIC | 88% | |||||||||||||
| ASI Short Dated Sterling Corporate Bond Tracker Fund5 | � | OEIC | 73% | |||||||||||||
| Aberdeen Standard OEIC V | � | � | � | |||||||||||||
| ASI UK Impact - Employment Opportunities Equity Fund 5 | � | OEIC | 86% | |||||||||||||
| Aberdeen Standard Opportunistic Core China Bond No. 1 Investment Private Fund56 | � | Private commingled fund | 100% | |||||||||||||
| Aberdeen Standard Overseas Investment Fund Management (Shanghai) Co., Ltd.37 | � | Ordinary shares | 100% | |||||||||||||
| Aberdeen Standard Pan European Residential Property Fund SICAV-RAIF26 | � | Limited partnership | 1% | |||||||||||||
| Aberdeen Standard Private Real Assets Co-investment Fund I GP, LP25 | � | Limited partnership | 79% | |||||||||||||
| Aberdeen Standard Private Real Assets Co-Investment Fund I, L.P.25 | � | Limited partnership | 1% | |||||||||||||
| Aberdeen Standard SICAV I | � | � | � | |||||||||||||
| Aberdeen Standard SICAV I - Asian Credit Bond Fund26 | � | SICAV | 51% | � | ||||||||||||
| Aberdeen Standard SICAV I - Emerging Markets Local Currency Corporate Bond Fund26 | � | SICAV | 84% | � | ||||||||||||
| Aberdeen Standard SICAV I - European Equity (ex-UK) Fund26 | � | SICAV | 29% | � | ||||||||||||
| Aberdeen Standard SICAV I - German Equity Fund26 | � | SICAV | 53% | � | ||||||||||||
| Aberdeen Standard SOF Evergreen GP LP | � | Limited partnership | 100% | � | ||||||||||||
| Aberdeen Standard SOF Evergreen LP | � | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Standard SOF IV Feeder LP | | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Standard SOF IV GP LP | | Limited partnership | 100% | � | ||||||||||||
| Aberdeen Standard SOF IV LP | | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Standard Syariah Asia Pacific Equity USD Fund42 | � | Unit trust | 29% | � | ||||||||||||
| Aberdeen Standard Unit Trust 1 | � | � | � | � | ||||||||||||
| ASI Diversified Growth Fund5 | � | Unit trust | 46% | � | ||||||||||||
| ASI Diversified-Core Adventurous Fund5 | � | Unit trust | 50% | � | ||||||||||||
| ASI Diversified-Core Cautious Fund5 | � | Unit trust | 63% | � | ||||||||||||
| ASI Diversified-Core Conservative Fund5 | � | Unit trust | 68% | � | ||||||||||||
| Aberdeen Trust Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen U.S. Mid Cap Equity Fund57 | � | OEIC | 69% | � | ||||||||||||
| Aberdeen UK Infrastructure Carry GP Limited4 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen UK Infrastructure Carry Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen UK Infrastructure GP Limited5 | | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen UK Infrastructure Partners Carry LP5 | � | Limited partnership | 25% | � | ||||||||||||
| Aberdeen UK Infrastructure Partners LP58 | | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Unit Trust Managers Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Aberdeen U.S. Private Equity Company VII, LLC25 | � | Limited liability company | 61% | � | ||||||||||||
| Aberdeen U.S. Private Equity VII, L.P.25 | � | Limited partnership | 1% | � | ||||||||||||
| Aberdeen Venture Company X, LLC25 | � | Limited liability company | 67% | � | ||||||||||||
| Aberdeen Venture Partners X, L.P.25 | | Limited partnership | 0% | � | ||||||||||||
| Aberdeen Venture Partners X SPV-A, L.P.25 | � | Limited partnership | 0% | � | ||||||||||||
| ACM Carry LP4 | | Limited partnership | 40% | � | ||||||||||||
| AEROF (Luxembourg) GP S.a.r.l.26 | � | Ordinary shares | 100% | � | ||||||||||||
| AIPP Folksam Europe II Kommanditbolag59 | | Limited partnership | 0% | � | ||||||||||||
| AIPP Pooling I SA26 | | Ordinary shares | 100% | � | ||||||||||||
| Airport Industrial GP Limited5 | | Ordinary shares | 100% | � | ||||||||||||
| Airport Industrial Limited Partnership5 | | Limited partnership | 0% | � | ||||||||||||
| Aldwych Capital Partners, L.P. | � | Limited partnership | 0% | � | ||||||||||||
| Amberia General Partner Oy15 | | Ordinary shares | 100% | � | ||||||||||||
| Andean Social Infrastructure Fund I LP4 | � | Limited partnership | 0% | � | ||||||||||||
| Andean Social Infrastructure GP Limited13 | | Ordinary shares | 100% | � | ||||||||||||
| Arden Asset Management (UK) Limited24 | | Ordinary shares | 100% | � | ||||||||||||
| Arden Asset Management LLC21 | | Limited liability company | 100% | � | ||||||||||||
| Arden Garden State NJ Fund, L.P.25 | | Limited partnership | 0% | � | ||||||||||||
| Arden Institutional Advisers, L.P.25 | � | Limited partnership | 0% | � | ||||||||||||
| Arden Institutional Advisers, L.P. - AIA Series T Holdings LLC25 | � | Limited partnership | 0% | � | ||||||||||||
| Arden Institutional Fund LP25 | � | Limited partnership | 0% | � | ||||||||||||
| Arthur House (No.6) Limited5 | � | Ordinary shares | 100% | � | ||||||||||||
| Name of related undertaking | � | Share class1 | % interest held2 | � | ||||||||||||
| Artio Global Investors Inc.22 | | Ordinary shares | 100% | � | ||||||||||||
| ASI Core Private Equity Fund L.P.25 | � | Limited partnership | 0% | � | ||||||||||||
| ASI (General Partner 2019 European PE B) Limited | | Ordinary shares | 100% | � | ||||||||||||
| ASI (General Partner 2019 European PE A Carry) Limited | � | Ordinary shares | 100% | � | ||||||||||||
| ASI (General Partner 2019 European PE A) S.a.r.l.26 | | Ordinary shares | 100% | � | ||||||||||||
| ASI (General Partner ECF II) Limited | � | Ordinary shares | 100% | � | ||||||||||||
| ASI (General Partner PE2) Limited | | Ordinary shares | 100% | � | ||||||||||||
| ASI (General Partner PFF 2018) S.a.r.l.34 | | Ordinary shares | 100% | � | ||||||||||||
| ASI (General Partner SOF IV) Limited | � | Ordinary shares | 100% | � | ||||||||||||
| ASI (SOF E GP) Limited | | Ordinary shares | 100% | � | ||||||||||||
| ASI Direct RE GP LLP | | Limited liability partnership | 100% | � | ||||||||||||
| ASI European Long Income RE Fund SCSp26 | � | Limited partnership | 0% | � | ||||||||||||
| ASI European Private Equity 2019 B LP | | Limited partnership | 0% | � | ||||||||||||
| ASI Han Co-Investment LP | � | Limited partnership | 0% | � | ||||||||||||
| ASI Hark Capital I GP, LLC17 | � | Limited liability company | 100% | � | ||||||||||||
| ASI Hark Capital II GP, LLC17 | | Limited liability company | 100% | � | ||||||||||||
| ASI Korea GP 2 Pte. Ltd.61 | | Ordinary shares | 100% | � | ||||||||||||
| ASI Korea Separate Account 2 LP61 | � | Limited partnership | 1% | � | ||||||||||||
| ASI Little Mill Carry LP4 | � | Limited partnership | 100% | � | ||||||||||||
| ASI Little Mill LP4 | � | Limited partnership | 0% | � | ||||||||||||
| ASI Mid Market Fund 1 LP26 | � | Limited partnership | 0% | � | ||||||||||||
| ASI Mid-Market 1 LP4 | � | Limited partnership | 0% | � | ||||||||||||
| ASI MM Executive Co Investment LP4 | � | Limited partnership | 0% | � | ||||||||||||
| ASI PE 1 Carry LP4 | � | Limited partnership | 40% | � | ||||||||||||
| ASI Phoenix Fund Financing SCSp26 | � | Limited partnership | 0% | � | ||||||||||||
| ASI Private Equity 1 LP4 | � | Limited partnership | 0% | � | ||||||||||||
| ASI Private Equity 2 GP LP | � | Limited partnership | 100% | � | ||||||||||||
| ASI Private Equity 2 LP | � | Limited partnership | 0% | � | ||||||||||||
| ASI REMM GP LLP4 | � | Limited liability partnership | 100% | � | ||||||||||||
| ASI Shin Co-Investment LP4 | � | Limited partnership | 0% | � | ||||||||||||
| ASI Shin Global Investment GP Limited13 | � | Ordinary shares | 100% | � | ||||||||||||
| ASPER (Luxembourg) GP S.a.r.l.26 | | Ordinary shares | 100% | � | ||||||||||||
| Baigrie Davies & Company Limited3 | � | Ordinary shares | 100% | � | ||||||||||||
| Baigrie Davies Holdings Limited3 | � | Ordinary shares | 100% | � | ||||||||||||
| BoS Mezzanine Partners Fund L.P.62 | � | Limited partnership | 0% | � | ||||||||||||
| BOSEMP Feeder LP4 | � | Limited partnership | 0% | � | ||||||||||||
| Bosera-Standard Life Investment Opportunities Market Debt Fund63 | � | Unit trust | 44% | � | ||||||||||||
| Castlepoint General Partner Limited64 | � | Ordinary shares | 100% | � | ||||||||||||
| Castlepoint LP64 | � | Limited partnership | 0% | � | ||||||||||||
| Castlepoint Nominee Limited64 | � | Ordinary shares | 100% | � | ||||||||||||
| C.C. U.S. Private Equity Fund GP, LLC25 | � | Limited liability company | 81% | � | ||||||||||||
| C.C. U.S. Private Equity Fund, L.P.25 | � | Limited partnership | 0% | � | ||||||||||||
| Coutts Asian Private Equity Limited Partnership13 | � | Limited partnership | 0% | � | ||||||||||||
| Coutts Global Property Limited Partnership13 | � | Limited partnership | 0% | � | ||||||||||||
| Coutts Middle East and North Africa Private Equity Limited Partnership13 | � | Limited partnership | 0% | � | ||||||||||||
| Coutts Private Equity Limited Partnership13 | � | Limited partnership | 0% | � | ||||||||||||
| Coutts Private Equity Limited Partnership II13 | � | Limited partnership | 0% | � | ||||||||||||
| CPP General Partner Limited Partnership | � | Limited partnership | 20% | � | ||||||||||||
| Cumberland Place Financial Management Limited3 | � | Ordinary shares | 100% | � | ||||||||||||
| Edinburgh Fund Managers Group Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Edinburgh Fund Managers Plc | � | Ordinary shares | 100% | � | ||||||||||||
| Edinburgh Unit Trust Managers Limited4 | � | Ordinary shares Deferred shares | 100% | � | ||||||||||||
| Elevate Portfolio Services Limited3 | � | Ordinary shares | 100% | � | ||||||||||||
| ESF I Executive Co Investment Limited Partnership64 | � | Limited partnership | 0% | � | ||||||||||||
| ESP 2004 Co Investment Limited Partnership64 | � | Limited partnership | 0% | � | ||||||||||||
| ESP 2004 Conduit LP | � | Limited partnership | 0% | � | ||||||||||||
| ESP 2004 General Partner Limited Partnership | � | Limited partnership | 0% | � | ||||||||||||
| Name of related undertaking | � | Share class1 | % interest held2 | � | ||||||||||||
| ESP 2006 Co Investment Limited Partnership64 | � | Limited partnership | 0% | � | ||||||||||||
| ESP 2006 Conduit LP | � | Limited partnership | 0% | � | ||||||||||||
| ESP 2006 General Partner Limited Partnership | � | Limited partnership | 5% | � | ||||||||||||
| ESP 2008 Coinvestment Fund L.P. | � | Limited partnership | 0% | � | ||||||||||||
| ESP 2008 Coinvestment General Partner Limited partnership | � | Limited partnership | 0% | � | ||||||||||||
| ESP 2008 Conduit LP | � | Limited partnership | 0% | � | ||||||||||||
| ESP 2008 Executive Co Investment Limited Partnership64 | � | Limited partnership | 0% | � | ||||||||||||
| ESP 2008 General partner Limited Partnership | � | Limited partnership | 0% | � | ||||||||||||
| ESP Co Investment Limited Partnership64 | � | Limited partnership | 0% | � | ||||||||||||
| ESP CPPIB European Mid Market Fund | � | Limited partnership | 0% | � | ||||||||||||
| ESP General Partner Limited Partnership | � | Limited partnership | 0% | � | ||||||||||||
| ESP Golden Bear Europe Fund | � | Limited partnership | 2% | � | ||||||||||||
| ESP Golden Bear General Partner Limited Partnership | � | Limited partnership | 0% | � | ||||||||||||
| ESP II Co Investment Limited Partnership64 | � | Limited partnership | 0% | � | ||||||||||||
| ESP II Conduit LP | � | Limited partnership | 0% | � | ||||||||||||
| ESP II General Partner Limited Partnership | � | Limited partnership | 0% | � | ||||||||||||
| ESP Tidal Reach General Partner Limited Partnership | � | Limited partnership | 20% | � | ||||||||||||
| ESP Tidal Reach LP | � | Limited partnership | 1% | � | ||||||||||||
| European Strategic Partners | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners 2004 'A' | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners 2004 'B' | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners 2006 'A' | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners 2006 'B' | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners 2008 'A' | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners 2008 'B' | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners II 'A' | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners II 'B' | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners II 'C' | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners II 'D' | | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners II 'E' | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners - I LP | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners Scottish 'B' | � | Limited partnership | 0% | � | ||||||||||||
| European Strategic Partners Scottish 'C' | � | Limited partnership | 0% | � | ||||||||||||
| FLAG Squadron Asia Pacific III GP LP13 | � | Limited partnership | 100% | � | ||||||||||||
| Focus Business Solutions Limited6 | � | Ordinary shares | 100% | � | ||||||||||||
| Focus Holdings Limited6 | � | Ordinary shares | 100% | � | ||||||||||||
| Focus Software Limited6 | � | Ordinary shares | 100% | � | ||||||||||||
| Focus Solutions EBT Trustee Limited6 | � | Ordinary shares | 100% | � | ||||||||||||
| Fraser Heath Financial Management Limited3 | � | Ordinary shares | 100% | � | ||||||||||||
| Griffin Nominees Limited5 | � | Ordinary shares | 100% | � | ||||||||||||
| GTAAN - SL LP | � | Limited partnership | 1% | � | ||||||||||||
| HDFC Asset Management Company Limited65 | � | Ordinary shares | 27% | � | ||||||||||||
| HDFC Life Insurance Company Limited66 | � | Ordinary shares | 15% | � | ||||||||||||
| Healthcare Private Equity Limited Partnership5 | � | Limited partnership | 0% | � | ||||||||||||
| Healthcare Private Equity LP58 | � | Limited partnership | 0% | � | ||||||||||||
| Heng An Standard Life Insurance Company Limited67 | � | Ordinary shares | 50% | � | ||||||||||||
| Ignis Asset Management Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Ignis Cayman GP2 Limited13 | � | Ordinary shares | 100% | � | ||||||||||||
| Ignis Cayman GP3 Limited13 | � | Ordinary shares | 100% | � | ||||||||||||
| Ignis Fund Managers Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Ignis Investment Services Limited | � | Ordinary shares | 100% | � | ||||||||||||
| Jones Sheridan Financial Consulting Limited3 | � | Ordinary shares | 100% | � | ||||||||||||
| Jones Sheridan Holdings Limited3 | � | Ordinary shares | 100% | � | ||||||||||||
| Lothian Thirty L.P. | � | Limited partnership | 0% | � | ||||||||||||
| Murray Johnstone Holdings Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| Murray Johnstone Limited4 | � | Ordinary shares | 100% | � | ||||||||||||
| NASP 2006 General Partner Limited Partnership | � | Limited partnership | 5% | � | ||||||||||||
| Name of related undertaking | � | Share class1 | % interest held2 | � | ||||||||||||
| NASP 2006 Special Limited Partnership | � | Limited partnership | 0% | � | ||||||||||||
| NASP 2008 General Partner Limited Partnership | � | Limited partnership | 0% | � | ||||||||||||
| NASP 2008 Special Limited Partnership | � | Limited partnership | 0% | � | ||||||||||||
| North American Strategic Partners 2006 LP13 | � | Limited partnership | 0% | � | ||||||||||||
| North American Strategic Partners 2008 LP13 | � | Limited partnership | 0% | � | ||||||||||||
| North American Strategic Partners (Feeder) 2006 | � | Limited partnership | 0% | � | ||||||||||||
| North American Strategic Partners (Feeder) 2008 Limited Partnership | � | Limited partnership | 0% | � | ||||||||||||
| North American Strategic Partners Companion Fund LP68 | � | Limited partnership | 0% | � | ||||||||||||
| North American Strategic Partners, LP68 | � | Limited partnership | 4% | � | ||||||||||||
| North East Trustees Limited69 | � | Ordinary A shares | 100% | � | ||||||||||||
| Origo Services Limited70 | � | Ordinary shares | 19% | � | ||||||||||||
| Orion Partners Holdings Limited71 | � | Ordinary shares | 100% | � | ||||||||||||
| Orion Partners Korea Inc.52 | � | Ordinary shares | 100% | � | ||||||||||||
| Orion Partners Mgmt (Singapore) Pte. Ltd.60 | � | Ordinary shares | 100% | � | ||||||||||||
| Orion Partners Services Inc.72 | � | Ordinary shares | 100% | � | ||||||||||||
| Ostara China RE Fund LP | | Limited partnership | 0% | � | ||||||||||||
| Ostara China Real Estate Fund L.P.72 | � | Limited partnership | 0% | � | ||||||||||||
| Ostara Japan Fund 3 LP72 | � | Limited partnership | 0% | � | ||||||||||||
| Ostara Korea GP 2 Pte. Ltd.60 | | Ordinary shares | 100% | � | ||||||||||||
| Ostara Korea Separate Account LP60 | � | Limited partnership | 0% | � | ||||||||||||
| Ostara Partners CLP Inc.72 | � | Ordinary shares | 100% | � | ||||||||||||
| Ostara Partners Inc. China72 | � | Ordinary shares | 100% | � | ||||||||||||
| Ostara Partners Inc. Japan 372 | � | Ordinary shares | 100% | � | ||||||||||||
| P25 Limited Partnership Incorporated73 | � | Limited partnership | 0% | � | ||||||||||||
| Pace Financial Solutions Limited3 | � | Ordinary A shares | 100% | � | ||||||||||||
| Pace Mortgage Solutions Limited3 | � | Ordinary A shares | 100% | � | ||||||||||||
| Parmenion Capital Ltd74 | � | Ordinary shares | 100% | � | ||||||||||||
| Parmenion Capital Partners LLP74 | � | Limited liability partnership | 100% | � | ||||||||||||
| Parmenion Nominees Limited74 | � | Ordinary shares | 100% | � | ||||||||||||
| Parnell Fisher Child & Co. Limited3 | � | Ordinary shares | 100% | � | ||||||||||||
| Parnell Fisher Child Holdings Limited3 | � | Ordinary A shares | 100% | � | ||||||||||||
| PE1 LP4 | � | Limited partnership | 0% | � | ||||||||||||
| PE1A LP4 | � | Limited partnership | 0% | � | ||||||||||||
| PE1B LP4 | � | Limited partnership | 0% | � | ||||||||||||
| PE2 LP4 | � | Limited partnership | 0% | � | ||||||||||||
| Pearl Private Equity LP | � | Limited partnership | 0% | � | ||||||||||||
| Pearl Strategic Credit LP | � | Limited partnership | 0% | � | ||||||||||||
| Pearson Jones & Company (Trustees) Limited75 | � | Ordinary shares | 100% | � | ||||||||||||
| Pearson Jones Nominees Limited75 | � | Ordinary shares | 100% | � | ||||||||||||
| PGB European Buy-out Fund I SCSp4 | � | Limited partnership | 0% | � | ||||||||||||
| Phoenix Group Holdings plc7 | � | Ordinary shares | 20% | � | ||||||||||||
| PT Aberdeen Standard Investments Indonesia42 | � | Limited liability company | 99% | � | ||||||||||||
| PURetail Luxembourg Management Company S.a.r.l.18 | � | Class A shares | 50% | � | ||||||||||||
| Regent Property Partners (Retail Parks) Limited5 | � | Ordinary shares | 100% | � | ||||||||||||
| Self Directed Holdings Ltd.74 | � | Ordinary A shares Ordinary B shares Ordinary C shares Preference shares | 100% | � | ||||||||||||
| Self Directed Investments Ltd.74 | � | Ordinary shares | 100% | � | ||||||||||||
| Serin Wealth Limited3 | � | Ordinary shares | 100% | � | ||||||||||||
| Shin Global Investment Partners LP13 | � | Limited partnership | 95% | � | ||||||||||||
| SL Capital 2016 Co-Investment GP LP | � | Limited partnership | 5% | � | ||||||||||||
| SL Capital 2016 Co-Investment LP | � | Limited partnership | 0% | � | ||||||||||||
�
| Name of related undertaking | � | Share class1 | % interest held2 | ||||
| SL Capital ECF GP LP | � | Limited partnership | 4% | ||||
| SL Capital ESF I GP LP | | Limited partnership | 0% | ||||
| SL Capital ESF I LP | | Limited partnership | 1% | ||||
| SL Capital European Co-Investment B LP | � | Limited partnership | 0% | ||||
| SL Capital European Co-Investment LP | � | Limited partnership | 0% | ||||
| SL Capital Ignis Private Equity Founder LP | � | Limited partnership | 65% | ||||
| SL Capital Ignis Strategic Credit Founder LP | � | Limited partnership | 0% | ||||
| SL Capital Infrastructure I GP LP | � | Limited partnership | 100% | ||||
| SL Capital Infrastructure I LP | � | Limited partnership | 0% | ||||
| SL Capital Infrastructure II LTP LP | | Limited partnership | 100% | ||||
| SL Capital Infrastructure II SCSp34 | | Limited partnership | 0% | ||||
| SL Capital Infrastructure Secondary I GP LP | � | Limited partnership | 100% | ||||
| SL Capital Infrastructure Secondary I LP | � | Limited partnership | 0% | ||||
| SL Capital NASF I LP | � | Limited partnership | 0% | ||||
| SL Capital NASF I A LP | � | Limited partnership | 2% | ||||
| SL Capital NASF I Carry LP | � | Limited partnership | 0% | ||||
| SL Capital NASF I GP LP | � | Limited partnership | 0% | ||||
| SL Capital Partners (US) Limited | � | Ordinary shares | 100% | ||||
| SL Capital Partners LLP | � | Limited liability partnership | 100% | ||||
| SL Capital Pearl Private Equity GP LP | � | Limited partnership | 0% | ||||
| SL Capital Pearl Strategic Credit GP LP | � | Limited partnership | 1% | ||||
| SL Capital SOF I Feeder LP | � | Limited partnership | 0% | ||||
| SL Capital SOF I GP LP | � | Limited partnership | 0% | ||||
| SL Capital SOF I LP | | Limited partnership | 0% | ||||
| SL Capital SOF II Feeder LP | � | Limited partnership | 0% | ||||
| SL Capital SOF II GP LP | � | Limited partnership | 0% | ||||
| SL Capital SOF II LP | � | Limited partnership | 0% | ||||
| SL Capital SOF III Feeder LP | � | Limited partnership | 0% | ||||
| SL Capital SOF III GP LP | � | Limited partnership | 0% | ||||
| SL Capital SOF III LP | � | Limited partnership | 0% | ||||
| SLC EC Executive Co Investment Limited Partnership | � | Limited partnership | 0% | ||||
| SLCI (Infrastructure 2018 A) Co-Invest LP | � | Limited partnership | 0% | ||||
| SLCI I Executive Co Investment Limited Partnership | � | Limited partnership | 0% | ||||
| SLCI Rail Co-Invest LP | � | Limited partnership | 0% | ||||
| SLCP (Founder Partner Ignis Private Equity) Limited | � | Ordinary shares | 100% | ||||
| SLCP (Founder Partner Ignis Strategic Credit) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner 2016 Co-investment) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner CPP) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner EC) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner Edcastle) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner ESF I) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner ESF II) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner ESP 2004) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner ESP 2006) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner ESP 2008 Coinvestment) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner ESP 2008) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner ESP CAL) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner Europe VI) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner II) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner Infrastructure I) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner Infrastructure Secondary I) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner NASF I) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner NASP 2006) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner NASP 2008) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner Pearl Private Equity) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner Pearl Strategic Credit) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner SOF I) Limited | � | Ordinary shares | 100% | ||||
| SLCP (General Partner SOF II) Limited | � | Ordinary shares | 100% | ||||
| Name of related undertaking | � | Share class1 | % interest held2 | � | |||
| SLCP (General Partner SOF III) Limited | � | Ordinary shares | 100% | � | |||
| SLCP (General Partner Tidal Reach) Limited | � | Ordinary shares | 100% | � | |||
| SLCP (General Partner USA) Limited | | Ordinary shares | 100% | � | |||
| SLCP (General Partner) Limited | � | Ordinary shares | 100% | � | |||
| SLCP (Holdings) Limited | � | Ordinary shares | 100% | � | |||
| SLIF Property Investment LP | � | Limited partnership | 0% | � | |||
| SLIPC (General Partner Infrastructure II LTP 2017) Limited | � | Ordinary shares | 100% | � | |||
| SLIPC (General Partner Infrastructure II) S.a.r.l34 | � | Ordinary shares | 100% | � | |||
| SLIPC (General Partner PMD Co-Invest 2017) Limited | � | Ordinary shares | 100% | � | |||
| SLIPC (General Partner SCF 1) Ltd | � | Ordinary shares | 100% | � | |||
| SLIPC PMD Co-Invest 2017 LP | � | Limited partnership | 0% | � | |||
| SLTM Limited | � | Ordinary shares | 100% | � | |||
| SOF I Executive Co Investment Limited Partnership64 | � | Limited partnership | 0% | � | |||
| SOF II Executive Co Investment Limited Partnership64 | � | Limited partnership | 0% | � | |||
| SOF III Executive Co Investment Limited Partnership | � | Limited partnership | 0% | � | |||
| Squadron Capital Asia Pacific GP, LP13 | � | Limited partnership | 100% | � | |||
| Squadron Capital Asia Pacific II GP LP13 | � | Limited partnership | 100% | � | |||
| Squadron Capital Management Limited13 | � | Ordinary shares | 100% | � | |||
| Squadron Capital Partners Limited13 | � | Ordinary shares | 100% | � | |||
| Standard Aberdeen Asset Management Limited | � | Ordinary shares | 100% | � | |||
| Standard Aberdeen Group Limited | � | Ordinary shares | 100% | � | |||
| Standard Aberdeen Investment Management Limited | � | Ordinary shares | 100% | � | |||
| Standard Aberdeen Investments Limited | � | Ordinary shares | 100% | � | |||
| Standard Aberdeen Limited | � | Ordinary shares | 100% | � | |||
| Standard Life (Asia) Limited76 | � | Ordinary shares | 100% | � | |||
| Standard Life Aberdeen Asset Management Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Aberdeen Group Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Digital Solutions Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Investments Brent Cross General Partner Limited | � | Ordinary shares | 100% | � | |||
| Standard Life investments Brent Cross LP | � | Limited partnership | 0% | � | |||
| Standard Life Investments Commercial Real Estate Debt LP5 | � | Limited partnership | 0% | � | |||
| Standard Life Investments (Corporate Funds) Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Investments European Property Growth Fund L.P.5 | � | Limited partnership | 0% | � | |||
| Standard Life Investments European RE Club (Offshore Feeder) Ltd13 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments European RE Club II (Offshore Feeder) Ltd13 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments European Real Estate Club II LP5 | � | Limited partnership | 1% | � | |||
| Standard Life Investments European Real Estate Club II LP Feeder Fund13 | � | Limited partnership | 0% | � | |||
| Standard Life Investments European Real Estate Club III LP5 | � | Limited partnership | 2% | � | |||
| Standard Life investments European Real Estate Club LP5 | � | Limited partnership | 2% | � | |||
| Standard Life Investments European Real Estate Club LP Feeder Fund13 | � | Limited partnership | 0% | � | |||
| Standard Life Investments (France) SAS77 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner CRED) Limited5 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner ELIREF) S.a.r.l.26 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner EPGF) Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner European Real Estate Club II) Limited5 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner European Real Estate Club III) Limited5 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner European Real Estate Club) Limited5 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner GARS) Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner GFS) Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner Global Tactical Asset Allocation) Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner MAC) Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner PDFI) Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner UK PDF) Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (General Partner UK Shopping Centre Feeder Fund LP) Limited5 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments Global Absolute Return Strategies Master Fund Limited13 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments Global Absolute Return Strategies Offshore Feeder Fund Limited13 | � | Ordinary shares | 100% | � | |||
| Name of related undertaking | � | Share class1 | % interest held2 | � | |||
| Standard Life Investments Global Absolute Return Strategies Onshore Feeder Fund, L.P. | � | Limited partnership | 0% | � | |||
| Standard Life Investments Global Focused Strategies Master Fund Limited13 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments Global Focused Strategies Offshore Feeder Fund Limited13 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments Global SICAV | � | � | � | � | |||
| Standard Life Investments Global SICAV Global Equities Unconstrained Fund78 | � | SICAV | 64% | � | |||
| Standard Life Investments Global SICAV II | � | � | � | � | |||
| Standard Life Investments Global SICAV II Emerging Market Debt Sustainable & Responsible Investment Fund78 | � | SICAV | 100% | � | |||
| Standard Life Investments Global SICAV II Global Equity Impact Fund78 | � | SICAV | 39% | � | |||
| Standard Life Investments Global SICAV II MyFolio Multi-Manager I Fund78 | � | SICAV | 34% | � | |||
| Standard Life Investments Global SICAV II MyFolio Multi-Manager II Fund78 | � | SICAV | 22% | � | |||
| Standard Life Investments Global SICAV II MyFolio Multi-Manager III Fund78 | � | SICAV | 27% | � | |||
| Standard Life Investments Global SICAV II MyFolio Multi-Manager IV Fund78 | � | SICAV | 32% | � | |||
| Standard Life Investments Global SICAV II MyFolio Multi-Manager V Fund78 | � | SICAV | 43% | � | |||
| Standard Life Investments Global SICAV Macro Systematic Dimensions Fund78 | � | SICAV | 45% | � | |||
| Standard Life Investments GTAA Company13 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (Hong Kong) Limited79 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (Jersey) Limited80 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (Mutual Funds) Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (PDF No. 1) Limited80 | � | Ordinary shares | 50% | � | |||
| Standard Life Investments (Private Capital) Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Investments Secure Credit LP | � | Limited partnership | 0% | � | |||
| Standard Life Investments Securities LLC22 | � | Limited liability company | 100% | � | |||
| Standard Life Investments (Singapore) Pte. Ltd81 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments (SLIPIT) Limited Partnership5 | � | Limited partnership | 0% | � | |||
| Standard Life Investments UK Shopping Centre Feeder Fund Company Limited5 | � | Ordinary shares | 100% | � | |||
| Standard Life Investments UK shopping Centre Feeder Fund Limited Partnership5 | � | Limited partnership | 0% | � | |||
| Standard Life Investments (USA) Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Portfolio Investments Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Portfolio Investments US Inc.25 | � | Ordinary shares | 100% | � | |||
| Standard Life Premises Services Limited | � | Ordinary shares | 100% | � | |||
| Standard Life Savings Nominees Limited | � | Ordinary shares | 100% | � | |||
| Tenet Group Limited82 | � | Ordinary B shares | 25% | � | |||
| Tenon Nominees Limited4 | � | Ordinary shares | 100% | � | |||
| The Coaching Platform Limited6 | � | Ordinary shares | 100% | � | |||
| The Munro Partnership Ltd.83 | � | Ordinary shares | 100% | � | |||
| Threesixty Partnerships Limited10 | � | Ordinary shares | 100% | � | |||
| Touchstone Insurance Company Limited84 | � | Ordinary shares | 100% | � | |||
| Two Rivers Limited Partnership5 | � | Limited partnership | 0% | � | |||
| Two Rivers One Limited32 | � | Ordinary shares | 100% | � | |||
| Two Rivers Two Limited32 | � | Ordinary shares | 100% | � | |||
| UK PRS Opportunities General Partner Limited5 | � | Ordinary shares | 100% | � | |||
| UK PRS Opportunities LP5 | � | Limited partnership | 0% | � | |||
| Virgin Money Unit Trust Managers Limited85 | � | Ordinary shares | 50% | � | |||
| VZWL Private Equity GmbH & Co geschlossene Investment KG44 | � | Limited partnership | 0% | � | |||
| Waverley Healthcare Private Equity Limited4 | � | Ordinary shares | 100% | � | |||
| Wealth Horizon Ltd74 | � | Ordinary shares | 100% | � | |||
| Wise Trustee Limited74 | � | Ordinary shares | 100% | � | |||
1 OEIC = Open-ended investment company
�� SICAV = Soci�t� d'investissement � capital variable
�� ETF = Exchange traded fund
2 � Limited partnerships in which the Group has no interest but whose general partner is controlled by the Group are considered related undertakings under Companies Act 2006. Where the Group has no interest in a limited partnership that is considered a related undertaking, the interest held is disclosed as 0%.
Registered offices
3��� 14th Floor, 30 St Mary Axe, London, EC3A 8BF
4��� 10 Queen's Terrace, Aberdeen, AB10 1XL
5��� Bow Bells House, 1 Bread Street, London, EC4M 9HH
6��� Cranford House, Kenilworth Road, Blackdown, Leamington Spa, CV32 6RQ
7��� Juxon House, 100 St Paul's Churchyard, London, EC4M 8BU
8��� 9 Raffles Place, #27-00 Republic Plaza, 048619, Singapore
9��� C/O IQ EQ Fund Services (Mauritius) Ltd, 33 Edith Cavell Street, Port Louis, 11324, Mauritius
10�� 2nd Floor, The Royals, Altrincham Road, Sharston, Manchester, M22 4BJ
11�� 6, rue Gabriel Lippmann L - 5365 Munsbach, Luxembourg, Luxembourg
12�� 2-8 avenue Charles De Gaulle, L-1653 Luxembourg, Luxembourg
13�� c/o Maples Corporate Services Limited, Ugland House, PO Box 309, George Town, KY1-1104, Cayman Islands
14�� Tuborg Havnevej 15, 2nd Floor, DK-2900 Hellerup, Denmark
15�� Kaivokatu 6, Helsinki, 00100, Finland
16�� Box 3039, Stockholm, 103 63, Sweden
17�� c/o Corporation Service Company, 251 Little Falls Drive, Wilmington, DE, 19808, USA
18�� 80, Route d'Esch, L-1470 Luxembourg, Luxembourg
19�� Office Unit 8, 6th Floor, Al Khatem Tower, Abu Dhabi Global Market Square, Al Marya Island, PO Box 764605, Abu Dhabi, United Arab Emirates
20�� 1266 East Main Street, 5th Floor, Stamford, CT 06902, USA
21�� c/o The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, DE 19801 Wilmington, USA
22�� c/o Corporation Service Company, 2711 Centerville Road, Suite 400, Wilmington, DE 19808, USA
23�� Rua Joaquim Floriano, 913 - 7th floor - Cj. 71 S�o Paulo SP 04534-013, Brazil
24�� 1 More London Place, London, SE1 2AF
25�� 1900 Market St, Suite 200, Philadelphia, PA 19103, USA
26�� 35a Avenue John F. Kennedy, L-1855 Luxembourg, Luxembourg
27�� 29 Rue De Berri, Paris, 75008, France
28�� 40 Upper Mount Street, Dublin 2, Republic of Ireland
29�� First Floor Dorey Court, Admiral Park, St Peter Port, Guernsey, GY1 6HJ
30�� Western Suite, Ground Floor Mill Court, La Charroterie, St Peter Port, Guernsey, GY1 1EJ
31�� First Floor, Sir Walter Raleigh House, 48-50 Esplanade, St Helier, Jersey, JE2 3QB
32�� Lime Grove House, Green Street, St Helier, Jersey, JE1 2ST
33�� Ahtri 6a, Tallinn, 10151, Estonia
34�� 2 Boulevard de la Foire, L-1528 Luxembourg, Luxembourg
35�� WTC, H-Tower, 20th Floor, Zuiplein 166, 1077 XV Amsterdam, The Netherlands
36�� Mikonkatu 9 Fin 00100, Helsinki, Finland
37�� West Area, 2F, No.707 Zhangyang Road, China (Shanghai) Pilot Free Trade Zone
38�� Bangkok City Tower, 28th Floor, 179 South Sathorn Road, Thungmahamek, Sathorn, Bangkok, 10120, Thailand
39�� Liberte House, 19-23 La Molle Street, St Helier, Jersey, JE4 5RL
40�� Level 10, 255 George Street, Sydney, NSW 2000, Australia
41�� 8F-1, No. 101, Songren Road, Taipei City, 110, Taiwan, Republic of China
42�� 16th Floor, Menara Dea Tower 2, Kawasan Mega Kuningan, Jl Mega Kuningan Barat Kav. E4.3 No. 1-2, 12950 Jakarta, Indonesia
43�� 21 Church Street, #01-01, Capital Square Two, 049480, Singapore
44�� Bockenheimer Landstrasse 25, 60325 Frankfurt am Main, Germany
45�� 44 Chipman Hill, Suite 1000 POX Box 7283, Stn. "A" Saint John, N.B. E2L 4S6, Canada
46�� AC 82 NO. 10 60 P 5 Bogota DC, Columbia
47�� 712 5th Ave, New York, NY 10019, USA
48�� Henrik Ibsens gate 100, PO Box 2882 Solli, 0230 Oslo, Norway
49�� 6th Floor, Alexandra House, 18 Chater Road, Central, Hong Kong
50�� 24 Merrion Row, Dublin 2, Republic of Ireland
51�� Otemachi Financial City Grand Cube 9F, 1-9-2 Otemachi, Chiyoda-ku, 100-0004, Tokyo, Japan
52�� 13th Fl., B Tower (Seocho-dong, Kyobo Tower Building), 465, Gangnam-daero, Seocho-gu, Seoul, Korea
53�� Suite 1005, 10th Floor, Wisma Hamzah-Kwong Hing No.1, Leboh Ampang 50100 Kuala Lumpur, Malaysia
54�� Schweizergasse 14, Zurich, 8001, Switzerland
55�� Suite 26.3, Level 26, Menara IMC, Letter Box No.66, No. 8, Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia
56�� Unit 1901-03, Platinum Tower, 233 Tai Cang Road Huang Pu District, Shanghai 20020. China
57�� PO Box 219534, Kansas City, MO 64121-9534, USA
58�� Edinburgh One, Morrison Street, Edinburgh, EH3 8BE
59�� Sveav�gen 24, 111 57 Stockholm, Sweden
60�� 80 Robinson Road, #02-00, 068898, Singapore
61�� 7 Melville Crescent, Edinburgh, EH3 7JA
62�� Suite 4109, Jardine House, One Connaught Place, Central, Hong Kong
63�� 11th Floor, Two Snowhill, Birmingham, B4 6WR
64�� 16 Charlotte Square, Edinburgh, EH2 4DF
65�� HDFC House, 2nd floor, H.T. Parekh Marg, 165-166, Backbay Reclamation, Churchgate, Mumbai - 400 020, India
66�� Lodha Excelus, 13th Floor, Apollo Mills Compound, N.M. Joshi Marg, Mahalaxmi, Mumbai - 400 011, Maharashtra, India
67�� 18F, Tower II, The Exchange, 189 Nanjing Road, Heping District, Tianjin, People's Republic of China, 300051
68�� 1 Rodney Square 10th Fl, 10 & King St, Wilmington, DE 19801, USA
69�� Clayton Wood Close, West Park Ring Road, Leeds, LS16 6QE
70�� 7 Lochside View, Edinburgh, EH12 9DH
71�� 28th and 30th Floor, LHT Tower, 31 Queen's Road Central, Hong Kong
72�� Campbells Corporate Services Limited, 4th Floor, Willow House, Cricket Square, KY1-9010, Cayman Islands
73�� Heritage Hall, Le Marchant Street, St Peter Port, Guernsey, GY1 4HY
74�� Aurora (3rd Floor) Finzels Reach, Counterslip, Bristol, BS1 6BX
75�� Clayton Wood Close, West Park Ring Road, Leeds LS16 6QE
76�� 12/F, Lincoln House, Taikoo Place, 979 King's Road, Quarry Bay, Hong Kong
77�� 100 Avenue des Champs Elysees, 1 Rue de Berri, F- 75008, Paris, France
78�� 2-4, Rue Eug�ne Ruppert, L-2453 Luxembourg, Luxembourg
79�� 30th Floor, Jardine House, One Connaught Place, Hong Kong
80�� 44 Esplanade, St Helier, Jersey, JE4 9WG
81�� 8 Marina Boulevard #05-02, Marina Bay Financial Centre Tower 1 01 8981, Singapore
82�� 5 Lister Hill, Horsforth, Leeds, LS18 5AZ
83�� Citadel House, 6 Citadel Place, Ayr, KA7 1JN
84�� c/o Aon, PO Box 33, Maison Trinity, Trinity Square, St Peter Port, Guernsey GY1 4AT
85�� Jubilee House, Gosforth, Newcastle-Upon-Tyne, NE3 4PL
�