Okay. Thank you very much for joining today's Q&A session on IFRS 17. I hope you've all had the opportunity to watch the video, or to look through the slides, both of which are on our website. My name is Ed Houghton. I'm the Group Strategy and IR Director. I'm joined today, by Jeff Davies, Group CFO, and Richard Crooks, IFRS 17 Accounting Lead. Can I remind analysts, please, to raise your virtual hand, as I can see some of you have done, if you'd like to ask a question. I'll invite you to turn on your camera and to unmute your line. We need to allow you to do this from our end, please bear in mind that it may take a moment or two while we click the necessary buttons. Please limit your questions to two. The first question is from Andy Sinclair, from Bank of America. Andy, please go ahead and unmute your line. Hi, guys. [crosstalk] Hi, Andy. Thanks for this time today, too, and thanks very much for all the detail you've provided to see first of the traps of the U.K. life insurers. Two from me, please. Firstly, I think you've been pretty clear that nothing in the real world is changing, but you did give some color on IFRS distributable reserves in the presentation. Just really wondered if you could put some more numbers around that just to give comfort that we're not gonna run into any issues with distributable earnings and that becoming a binding constraint. That's my first question. My second question, I've asked a few other companies similar questions as well, was just looking at the difference between own funds in Solvency II world and IFRS shareholders' equity plus CSM and I guess risk adjustment as well. I think own funds are about GBP 17.4 billion at half year, but that includes various qualifying debt. I think book value plus CSM and risk adjustment, I get to what? About GBP 17.5 billion-GBP 18.5 billion from the numbers you put out today. Just wondered if you can give me a kind of a waterfall between the two of them, 'cause I don't think you've got too much goodwill. Just if you can walk through that. Thank you very much. Cheers, Andy. Thanks. Yeah, as we said, we have material distributable reserves at both the LGAS main insurance entity and at the group level. We see no concerns at all about that. Obviously, with the additional statement from the board about dividend payments. It's in the many GBP billions. We have no concerns at all about it. You know, so that. We're very happy with that, and we've been, you know, conscious of it from the start in looking at what some of the dynamics would be and been comfortable throughout. And Richard has been one of the people monitoring that. Yeah, in terms of the analysis, we do show the Tier 1 own funds against equity plus CSM because there is some of that analysis. You get some slight differences in risk margins and versus transitionals and risk adjustments. Discount rates are slightly different, you know, in terms of, actually the fundamental spread is more prudent than the 41 basis points we have under IFRS 17, for example. You know, there are a few differences amongst that. You know, broadly, they're different ways of looking at the same balance sheet. Yeah, we think that's a good way to look at, as you say, shareholder equity plus CSM, and what you see as the addition. We don't have any sort of material goodwill at all in us. Great. Thank you very much. Best regards. Great. The next question is from, Greig Paterson. Greig, please go ahead and, open your line. Can you hear and see me, everybody? We can hear you. You can't see my handsome face? No, we can't, which is a disappointment, Greig. Yeah. Must be. I get... Sorry. Jokes aside, just two quick questions. In terms of the operating profit, I mean, I've obviously just had a quick scan through your presentation. Am I correct in understanding that there'll be no mark-to-market impacts going through the operating profits or either below the line or straight to OCI? The second point is, a second question is, excluding the movement in the CSM, am I correct that there'll be a supplementary income statement, so it'll look very, very similar to what we saw before in terms of, you know, new business, enforced contribution, operating assumption. I see even you're referring to NSG, so by definition, that still has to exist. Basically, the income statement for an investor will look pretty similar except for the CSM movement. Is that a fair statement? Yeah. Okay. Yeah, our profit, there will be very little in terms of mark to market there. Certainly, the changes in terms of insurance business, will be very much an unwind and expected on our excess assets, and then the unwind from the amortized cost assets that we've allocated, which effectively back the CSM. You know, we won't get that. We then get the expected unwind, if you like, from the prudence in the discount rate, you know, the sort of 41 basis points. The rest would fall to investment variance to the extent it exists, but we have looked to take as much of that out of the result as possible, for example, through the protection business going through OCI in terms of rates impact, and by allocating some of the assets that back the CSM for the annuity business to amortize cost as well. There should be a lot less noise from the insurance business in respect of mark-to-market, certainly. In terms of the statement, I mean, to some extent that's true. We're into the depths of disclosures and what's required, but there will be a breakdown. It will be, a lot of it will be centered around sort of CSM, if you like, a new business metric. What are you adding from CSM? What is the unwind from CSM? What is your interest rate accretion to that? What have you earned on your assets? That will give you your overall operating result. There will be, and we will also help walk people through what we saw before and what are you seeing now. Certainly in the early stages, that could be one of the things we would do in May, for example, to try and make that a bit easier. It'll have all those constructs that it had, that I mentioned that it had before, you know, pre-CSM, and then there'll be the CSM adjustments to those old constructs. You'll be able to see experience variance. You'll be able to see CSM unwind. Most of them will be there, but you won't, you won't have, you know, the net release from operations doesn't exist in the same way. That is effectively, you know, well, your CSM to some extent, and what's been thrown off the year in force comes from that. All right. There will be differences in the prudence. Yeah, absolutely. As I say, we'll try and walk people through that as we give much, you know, broader disclosures going forward. All right. Thank you. Cheers. Okay. Thanks, Greig. The next question is from Ashik Musaddi. Ashik, please go ahead and open your line. Go ahead, Ashik. Oh. We see you, but we don't hear you. I think you're on mute, Ashik, on your side. No. It's good. We'll come back to you, Ashik. Sorry. We'll come back after the next one. Yeah. Let's go ahead, please, and open the line to Nasib. Thank you. Thanks, Ed. Can you guys hear me? Yeah. Yeah. All good. Yeah. Two questions. I guess the first one is on the EPS target being greater than the EPS previously. I see in the release you've said GBP 10 billion of PRT would give you 6%-7% CAGR on U.K. PRT operating earnings. You've changed the DPS growth to 5% as well. It seems like EPS is still growing greater than DPS. Is the growth actually bigger because you kind of rebased your starting point lower by 20%-25%? That's the first question. Second question on slide 14. Just on the prudence on IFRS 17, the 41 basis points. Is that just credit risk, or does that include risk adjustment CSM as well? Because 41 basis points seems a little bit high. Jeff, you mentioned that fundamental spread is higher, which is about, yeah, around about 50 basis points. If I compare, kind of the prudence on Solvency II, that'll be higher on a like-to-like basis, right? We could kind of put 50 basis points next to that on a solvency basis. Is that correct? Thanks. Yeah. Yeah, yeah, I'm not quite sure, say, apart from you're right on all of that. I mean, EPS, yes. EPS greater than DPS. Yeah, we tried to give the example that if we write sort of our ambition levels, you know, when we talk about GBP 10 billion of PRT is often what we've talked about, and equally on a self-sustaining portfolio, then you would get profit growth of 6%-7%, you know, broadly across the insurance business. Clearly, there's upside to that if we are to capitalize on the very large PRT market that's out there. Anything we write on top of that would give us an increase in profit growth. Of course, any assumption changes. You know, if there are longevity releases in the future, those will also add to CSM and give us greater profit growth. You know, that's a, that's a sort of a clean number. Everything happens as expected. You write this business with a sort of a 9% of CSM and risk adjustment added on GBP 10 billion, and that then it runs off at 8%. It's trying to give the maths for people to build something. Yes, there are well, upsides, and you could argue downsides, but there's definitely upsides to that if we write more volume, or there are longevity releases, et cetera, that come through over time and are released. You're spot on. I've been arguing the point. 41 basis points does seem quite prudent. It's, you know, supposed to be a best estimate view of cost of default and downgrade, but it is quite a big number. Our own experience is about one basis point for defaults, as you know. That's where roughly 20 basis points of that would unwind into op profit, and then the next 20 basis points, if experience is in line with what we've had, would unwind into investment variance. We're looking at about GBP 200 million of profits each year rolling out of that 41 basis points on top of CSM unwind and risk adjustment unwind. That's clear. Thank you. Thanks. Thanks, Nasib. Next question is from Andrew Crean. Andrew, please go ahead and open your line. Okay. Can you hear and see me? Yeah. All good, Andrew. Good. That's amazing. I can actually work the technology. Two things. Firstly, historically, you've hedged the IFRS balance sheet, which is unique. Now that you've got a steadier IFRS position, will you switch to hedging the Solvency II balance sheet and therefore putting an underpin to your 220%-225% coverage ratio? Secondly, I'm still struggling to understand why you want to grow your earnings faster than your dividends, given the fact you've got a much steadier profile of earnings. You know, I think you're saying over the last few years you've generated about GBP 0.5 billion more capital surplus than dividends. Is it not time to increase the payout ratio, not reduce it? Good question, Andrew. Hedging, w ell, it's interesting actually, we are now looking at what you've talked about. The movement to IFRS 17 definitely makes our ALM easier and the hedging easier because what we effectively do, you get two best estimates that are much more alike on an IFRS 17 and a Solvency II basis. We can do our cash flow matching, do our best estimate liability matching, then we have excess assets, we can decide, you know, what we do with that. The fact that we have allocated quite a lot of the ones back in the annuity CSM to amortized cost means that doesn't give any noise in the investment variance, therefore, we can have those to offset movements in rates for the solvency ratio. We will be looking as we embed all of this to see if there is something we can do, which could involve lengthening some of those with some more assets outside the best estimate liability, which could potentially take some of the rate sensitivity out of the solvency ratio. We obviously, at the moment, we're bedding in that, moving from IFRS 4 to IFRS 17, and it's something we're investigating to see would we want to do more of that, lengthen slightly using assets, which would slightly reduce that solvency sensitivity that you talk about and the ratio. It is, of course, as we've always said, a noneconomic hedging that you are doing, and so we would want to trade off what are the costs and benefits of that. It's definitely something we're investigating. As we think, do more thinking on it, we will obviously update, and you'll see it coming through in our sensitivities. The earnings less, greater than dividend. We think it's a good thing to grow the earnings, of course, and we have grown the book value consistently. We see that as a indication of good quality earnings. I mean, as much as anything, it's to show we also manage the investment variance and, you know, our good quality result, which has then had earnings growing bigger than dividend. We do want to reinvest to some extent, whether that is capital or liquidity, whilst growing the book value gives us reducing leverage and gives us options around that. I mean, in terms of restating it this time, obviously we didn't want to use an IFRS education session to completely change all of our targets. We did update on dividend to some extent, we didn't want to restate every item. I know in terms of earnings greater than dividend. We do see value in quality of earnings, growing book value, and having some optionality around that. You know, as we've said before, we'll continue to review where we think the capital policy takes us and what we should be doing. We're happy with the 5% growth on dividend at this stage and using our earnings to potentially deploy against the PRT demand that is out there and invest on an ongoing basis into LGC and other growth opportunities. Okay. Reducing payout ratios over time. Oh, potentially, yes. If we're growing your earnings. Yes, that's right. Sorry, I was thinking of the other one. Yes. Okay. Can we try and go back to Ashik, perhaps? Ashik, hopefully, we can hear you if you unmute your line this time. Can you hear me? Yes. That's great. Thank you. I just have a couple of questions. Sorry, first of all, for clarification, first of all, you mentioned that the divisional earnings are going to go down by 20%-25%. Is that only LGRI and LGRR? Is it the total divisional earnings? What about the final operating earnings? Is it possible to get a bit of view on what is the final operating earnings? Does it mean that if it's all divisional earnings, does that mean that final operating earnings is going to go down more than that? That's the first one. And just related to that is any sense of how much of this is only coming from annuities would be helpful. Second thing is, now, I guess one of the reason why your earnings are going down is because of growth, because probably you'll have now negative new business strain. What happens to your earnings growth if, let's say, you do not grow at all? You just keep your book flat, whichever is, say, GBP 3 billion, GBP 4 billion of annuities to maintain a flat book. What happens to your earnings growth? I'm just trying to get a bit of understanding is what is the steady-state earnings growth or earnings number if you don't grow at all? Just keep a flat steady-state business. Thank you. Yeah. Okay. Yeah. Obviously, the only businesses that are impacted are the insurance businesses. So, specifically, it's the annuities and the protection businesses within the retail division, and obviously the PRT business, LGRI. So those are the only ones impacted. If you know, you run through their numbers to the profit by divisions, you get the 20%-25%. If you then look at the bottom line of profits, you obviously get a slightly higher number than that, depending on the relative impacts of the group costs, et cetera, and just you get a small difference between that. That's just slightly higher. That's sort of it. You can drop it in on what we've had over the last sort of three years, if you like. In terms of flat, I think the simple answer is it would be flat. If we keep it flat, it'd be flat. Because, you know, then we will effectively be the maths we've tried to give to help people in their models is the CSM, you add interest of about 3%. The CSM amortizes at about 8%, so that would be net about 5%. That would run down at about 5%, the CSM, but it would be, if you're keeping the business flat, your investment margins, et cetera, would be pretty similar. You know, you might get a slight reduction, if you were doing it at that level. Clearly the, you know, the, what we're out to do is to add to the CSM. You know, even if we're writing GBP 7 billion, GBP 8 billion, GBP 9 billion, GBP 10 billion, then, you know, we're going to be growing the business and we've tried to give, again, some numbers so people can model that. You know, you add need, because of round numbers, you add GBP 10 billion of new business with 9% of CSM and risk adjustment that runs off at about into profit of about 8% per annum. That gives you a growing book, plus you get the investment margin, which increases on top of that. That's where you get to the sort of 6%-7%. There's enough pieces in there for people to model an annuity book. Sorry, because you did mention in the first bit, it is dominated by the annuities. 80% of the CSM risk adjustment is from the annuity book. That dominates really the dynamics of it. Clearly, the protection book's in there, it's interesting, it's got a material amount, you know, in the billions of CSM, but the annuity book absolutely dominates quite clearly of our insurance business. Thank you. Just one thing on this again. It's fair to say that it's not that new business strain is adding any drop in earning. It's nothing to do with new business strain. Going forward as well, like, does your growth rate, the 6%-7% changes if you do more growth or less growth? Yes. Because in Solvency II the way it works is if you grow faster, then your total capital generation drops. It's counterintuitive, but it drops because of the new business strain. Does that same dynamic work here as well? No, it's the opposite. The more business you write, the more CSM you add, assuming it's all profitable, obviously. The more CSM you add, which just means your profits grow in the following period. It's very predictable. It's not volatile. You can see what happens. It's all math. You know, how much are you adding? How much is running off? You all know the duration of an annuity book. You add some interest to that, and we make the yield on the underlying assets, which is your additional source of profit. it's very straightforward, and you can work out the math to grow the book. there's no strain element as involved as long as you're not writing loss-making business. Okay. Thank you. Thanks a lot. Thanks, Ashik. Let's go, please, to Larissa next. Larissa, please go ahead and unmute your line. Thank you very much, Ed. Two questions, both pertaining to slide 13, please. I recognize that this is initiative, so not science. If we can look at the component parts, on our existing CSM stock, if we roughly eyeball it looks like it decreases by about 3 odd percent a year. If the question is how much of next year's profit is already locked in from the existing book, is that a reasonable rough way to look at it? Oh, sorry, Lar. Almost all of next year's profits is locked in from the existing book because the new business profit is just at most half a year's run off on a CSM. So 1/24th, let's say, making it up of what you write in a year. It's all locked in. Thank you. That's b ecause here it appears to be going down, which seemed wrong. Okay, we can basically assume that year on year it will stay flat if we write no new business. Is that correct? Actually, we show on a previous slide. The run-off does slightly increase as a percentage. Actually the contribution from the in-force, especially over the first few years, is pretty flat in your earnings, which is obviously a nice feature to have of the business. Effectively, we take a 20%-25% knock next year, effectively the profits are locked in for the next 12 years. Is that a reasonable way to think about it? Yes, that's right. As long as experience obviously plays out. Hopefully, fingers crossed. If we take new business profit, can we, would it be a reasonable expectation to take VNB divided by 12 and add that to the previous year's profit? Yeah. Well, we say in the presentation that, you know, new business, focusing on annuities, that it's approximately 9% of premium. GBP 900 million on a GBP 10 billion book. That goes straight to your CSM and risk adjustment, and then as you say, the following year, let's call it 8%, a 12th of that runs off into profit. Yes, you're adding that each period, and that's where you can see building up. Don't forget, you're also growing the book, so the investment return component, which is not included in that, also grows as you're growing the book. You know, if GBP 3 billion-GBP 4 billion of annuities run off, but you write 10, you've grown the book by GBP 6 billion, which out of GBP 80 billion-GBP 90 billion is 7%-8%. That's where you get more growth. Brilliant. Thank you very much. Next and currently the last question is from Dom O'Mahony. Dom, please go ahead and unmute your line. Hello, folks. Can you hear me? Yeah. Can you see me? Perfect. Hello, hello. Thanks, also from me for the presentation. Very helpful. I've got a couple of questions. just on the 20%-25% change, I mean, that's against the last three years. In the last three years, your assumption changes. If I look at your Op profit breakdown, they're very big, something like 20% of the operating profit. can you just give us a sense of what the 20%-25% reduction would be if you stripped all the assumption changes out of the numbers? Really just thinking about the new business dynamic, I'm guessing it's lower than the 20%-25%. Can I just also just clarify, I'm hoping this is part B of the same question, so I've got my allowance of two. Experience variances will still be recognized in the year. If you have excess mortality in a year, am I right in saying that will all be recognized in the year, it won't be rolled up into the CSM? Second question. In terms of the transition of the balance sheet, I see you've got about 1/3 of the CSM comes from the fair value approach. Can you give us a sense of whether you think applying the fair value approach versus the full retrospective or modified retrospective, does that change the output in terms of how much CSM and how much profit you're expecting to generate? Is it really just a detail of methodology and I shouldn't worry too much about the transition approach? Thank you. No, good questions. As you say, you know, over the last three years, you know, the assumption changes, longevity, releases, et cetera, have been quite material. Easiest way to think about new business, I mean, there's some small numbers there from retail protection in the GBP tens of millions, but of course, the number we've always used is 2.5%-4% in a really good year of premium would've been profit for the annuity business, you know. If we were writing GBP 6 billion, GBP 7 billion, GBP 8 billion, GBP 9 billion, you know, you're talking GBP a couple of hundred million of profit only would've been from the new business if you take the assumption changes out. You can see that, you know, two out of almost, you know, GBP 1.5 billion-GBP 2 billion, whatever the number is, I mean, even of the annuity business, when we were making a GBP 1+ billion on PRT business, the GBP 200 million wasn't a huge number of that for just new business alone, and that was only PRT, let alone the whole group profits. Yes, you're right on that. It's that sort of the percent... If you think about it as percentage of premium, we would always talk about 2.5% to max 3.5%, 4% of premium as profits in the IFRS 4. Now we're saying, well, look, 9% is set up as CSM and risk adjustment for annuity business, which is much more in line with our Solvency II new business value, which makes sense that that's where you get to. On your experience variance, yes, the actual variance within year will obviously flow through in exactly the same way. It's only if you make an assumption change does it go to the CSM. If we made a change to our view of future longevity improvements, that would be capitalized and put in the CSM and then spread over the next 12 years, as we've been talking about as a sort of duration element, as opposed to before, it would've dropped through to profit. Yes, that's the difference there. That's your A and B. Yeah, 30% on the fair value. I mean, Richard could bore us for a long time the merits of the different methodologies and what they mean. To one extent, I would say I wouldn't worry about it too much, 'cause most of the fair value is pre-Solvency II. That's been an easy cutoff for people, 'cause it was very hard to get all the data and granularity that you needed pre-2016. The reason I say that is, to put it in context, in the last five years, we've written GBP 40+ billion of annuities, whereas in the five years before that, we wrote about GBP 16 billion. You know, the vast majority of value has come from the fully retrospective, with a modification, but that's just minor, tweaks where it didn't quite qualify. It's as if we'd had IFRS 17 from when we wrote the vast majority of our book, and so I think I would, I would just guide you towards that in terms of materiality. Sorry, just do you mind if I just clarify? On the, t hat's very helpful. On the 20%-25%, you said the reduction in op profit, I'm guessing. My question was really how much of that is because assumption changes no longer drop to the op profit? I'm guessing a big portion of the 20%-25% reduction in op profit is actually just the assumption changes no longer contributing. Yeah, absolutely. Yes. Yes. What would. That's half the cost. I mean, if we were to rebase the last three years excluding assumption changes, could you give us a sense of how much you would expect the op profit to move? I mean, it varies in each year, but it's at least half that number, I would say. Half is the assumption change? Yeah. Got it. At least. Okay, got it. Some years it would be more, some years more. Yeah. It's never less than half of the top of my head. Okay, very good. That's really helpful. Thank you. I mean, we can see it in the numbers and we can share. Yeah. Yeah. Okay. We have a repeat questions from Andrew Crean. Andrew, go ahead. Is that Chief Andrew? I hope not. Look, you keep on hinting that you might increase your BPA writings, clearly, given the funding position of the annuity market, that is very possible. It doesn't have an impact immediately on your IFRS earnings, but it will impact your solvency capital generation. That in the end pays the dividends. Could you be more clear as to what your strategy is on writing BPAs? Are you gonna stick with your current targets or do you think you're gonna open your shoulders? You have the capacity so to do. I mean, what we've been saying, and it is our current approach, is I think with the greater market demand out there that everyone is aware of and talking about, it is probably easier, if you like, for us to hit our eight to 10 ambition and possibly be at the top end of that or slightly over. That would then allow us to still be self-sustaining, the things we've talked about, et cetera, though we have headroom within that over our ambition period. You know, as everyone notices, our capital position is strong at the moment, so we wouldn't be concerned with going over the limit slightly on sort of self-sustaining. However, on top of that, there is undoubtedly a good number of jumbo type cases out there that we're all in conversations with, and they're trying to work out what they'd like to do. We're all trying to work out the best way to take them on board. On top of that BAU eight to 10ish type numbers, that we may well do, you know, some one-off transactions which might repeat for a few years. As and when we get to those, we'll communicate appropriately around those, how we're thinking about it, how are we using reinsurance, what is it doing to our capital, how have we thought about it, and we would do that at the time. Clearly, we will look at those, what metrics are available, can we deliver them, we have the assets to back them, et cetera, and we'll talk about the time. We're certainly not shutting off that we're going to do that, but I think that's more likely the scenario than that we just happen to write 12, you know, by mistake as BAU, if you like. We will continue to communicate around that. As we have more conversations with schemes, you know, I think the intentions of all parties will become clearer on that. Okay. You'd like us to look more at IFRS or your Solvency II capital generation. What is your primary metric you want us measured by? Solvency II is clearly the more sort of, well, the economic view of the world. It's certainly the constraint that everyone has looked at in terms of dividend-paying ability. We're in a nice position of, you know, GBP 220, GBP 225 at the moment, where rates are on any day. It's that capital generation, what are we doing that helps us to determine what is available, what does that mean, what's coming off the business. You know, we now have a, an underpin, a very stable accounting, but we've seen that could be very volatile. Solvency II is generally what we've looked at, and, you know, you've all looked at over the last few years. Thanks. Oliver Steele, I can see you've got your hand up. You haven't asked a question, please go ahead and unmute your line. Hello. Hoping you'll hear me, you're hearing me. 50% of your LTIP is linked to IFRS earnings, and has been, I think, over the last few years. You're now telling us that all the assumption changes have basically been written back over, you know. How is your board assessing the LTIPs that you've paid in recent years? How are you planning to adjust the LTIP targets for 2020-2023 and 2021-2024? Well, I didn't think we'd be talking about pay for that, so that's a good. We have considered that. I mean, the biggest thing I would point you towards is, of course, the vast majority of our longevity releases were excluded from everything. We excluded them explicitly. They were excluded from what you looked at in terms of earnings. They were excluded from all of our earnings discussions. You know, that has been taken out of that. We always, and will continue to, have the very interesting discussions of RemCos, of one-offs, releases, what does that look like, and we absolutely are considering all of that. It is very relevant and equally, you know, where are we rebasing for EPS, et cetera, and we have considered that. That will come out in the next. We'll have to explain it further in the next report and accounts. Good to hear that the exceptionals were excluded. That's actually quite a relief. In, just going back to Andrew Crean's question then about what you see as more important between Solvency II capital generation versus IFRS earnings. I mean, you're almost unique amongst the U.K. life companies in still using IFRS earnings in the LTIP. Are you gonna change that going forwards? Well, that's an interesting question. We have brought in a Solvency II metric more quantitatively into our earnings management objectives, et cetera, and we'll continue to look at that. For this very reason, we've been looking at what makes sense. There's obviously then the debate of what's the right one. Is it operating surplus generation, net surplus generation? Is it capital budget and usage? Yes, that's further discussion we have. We do have one explicit one in there, and we will continue to do that. Equally, it's a bit like we said, you know, earnings versus dividend. We quite like growing book value and showing that you've got good quality earnings. You can't completely ignore one. One, you can say, is accounting, one's a regulatory basis. There's a balance, but, you know, it's more what's the constraint? What is management incentivized on? That's the constraint on the business. If it is more about surplus generation, then, you know, we will potentially look at that and decide whether we put more weight on it or not. Thank you. Okay. let's go to Ashik again, please. Ashik, go ahead. Thank you. Just one question. I mean, is it for this risk adjustment, I mean, if I understand correctly, is it fair to say that risk adjustment number is about, say, GBP 4 billion or GBP 5 billion? What is the basis of coming to this risk adjustment number? I'm asking it because I guess given that you have done a lot of longevity transfers to insurers, why do we have such a big risk adjustment number at this point? Yeah, no, it's- I would have assumed that it's a bit lower, so. Yes. Actually, as you've asked, it's not explicitly in there anywhere. I don't know if you've got your ruler out on one of the pages. It's a smaller than number than that. Let's call it GBP 2 billion-GBP 2.5 billion. Obviously, none of this is finalized yet. You know, how do we get to that? It is, you know, not the same type of calculation as the risk margin. It's very much what is your claims experience, labs experience in the 85th percentile and, you know, if that's what you get throughout, how much extra would you, would you need for that? What's the sort of reward that you need for that? What is the extra claims cost? That's where you get to the number. Whilst you say our new business has a lot of reinsurance, which is true, of course, we haven't reinsured any of the individual annuities. We had a reasonable size back book. I think we are still let's call it round number 70% or so retained on longevity. It might be slightly lower than that now after, you know, when we eventually round off the 2022s business. It's certainly 65% still retained. You get a reasonable number just for pure longevity. Of course, we'd have mortality in the U.S., lapse experience on the protection books as well. Okay, thank you. Just one more question I have is, I guess this time I'm asking a bit too much. I know I'm at a risk of asking too much. Your net of tax CSM is about GBP 8.5 billion. Is it possible to split this between what is the spread component and what is the technical margin component, say, longevity component or say how much is the protection component or what is the spread component? Yeah. sorry. we do give that it's about 80% of it is annuities. No, within annuities, is it all spread or is there a longevity component as well? No, no. There's no spread component in that. That's in the discount rate. The prudence for the discount rate is within your best estimate liability. That's the 41 basis points. If you think of it very simply on day one, you write annuity, you have a premium, you discount it at your expected payouts at a prudent rate, which with the 41 bits off the yield, what's left is the CSM. That's all. That's just left over from the premium less the best estimate, less the risk adjustment, obviously. Okay. Very okay. Thank you. I can see, I can see Richard suffering. I think perhaps we'll draw a line under things here. Greig, we can follow up with you offline, if that's okay. Thank you very much for your questions today. I hope you found the video, slides and Q&A session helpful. Please do follow up with us in IR, if you've got further questions. Thank you very much. Yes. Thank you, everyone. Cheers.