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Annual Report 2018

Statement of shareholders’ equity

For the years ended 31 December

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USD millions

2017

2018

1

In 2018, MS&AD Insurance Group Holdings Inc (MS&AD) acquired a 15% non-controlling interest in ReAssure, a subsidiary of the Group.

2

In 2018, the Group performed a review of the carrying values of treasury shares, resulting in an increase of USD 65 million in treasury shares and a corresponding increase of the same amount in additional paid-in capital. The reclassification has no impact on net income or net equity of the Group.

3

Impact of Accounting Standards Update. Please refer to Note 1 for more details.

Contingent capital instruments

 

 

Balance as of 1 January

1 102

750

Changes during the period

–352

–750

Balance as of period end

750

0

Common shares

 

 

Balance as of 1 January

34

33

Cancellation of shares bought back

–1

–1

Balance as of period end

33

32

Additional paid-in capital

 

 

Balance as of 1 January

341

368

Impact of sale to non-controlling shareholder1

34

123

Contingent capital instrument issuance costs

8

11

Cancellation of shares bought back

 

–85

Share-based compensation

–14

–6

Realised gains/losses on treasury shares2

–1

85

Balance as of period end

368

496

Treasury shares, net of tax

 

 

Balance as of 1 January

–1 763

–1 842

Purchase of treasury shares

–1 161

–1 454

Cancellation of shares bought back

1 006

1 032

Issuance of treasury shares, including share-based compensation to employees2

76

–27

Balance as of period end

–1 842

–2 291

Net unrealised investment gains/losses, net of tax

 

 

Balance as of 1 January

4 459

4 746

Impact of sale to non-controlling shareholder1

 

–325

Impact of ASU 2018-023

 

176

Impact of ASU 2016-163

 

44

Impact of ASU 2016-013

 

–347

Changes during the period

287

–2 389

Balance as of period end

4 746

1 905

Other-than-temporary impairment, net of tax

 

 

Balance as of 1 January

–5

–2

Changes during the period

3

–1

Balance as of period end

–2

–3

Cash flow hedges, net of tax

 

 

Balance as of 1 January

–7

–10

Impact of sale to non-controlling shareholder1

 

1

Changes during the period

–3

15

Balance as of period end

–10

6

Foreign currency translation, net of tax

 

 

Balance as of 1 January

–6 074

–5 548

Impact of sale to non-controlling shareholder1

 

52

Changes during the period

526

–408

Balance as of period end

–5 548

–5 904

Adjustment for pension and other post-retirement benefits, net of tax

 

 

Balance as of 1 January

–1 135

–820

Impact of sale to non-controlling shareholder1

 

13

Impact of ASU 2018-023

 

–17

Changes during the period

315

–4

Balance as of period end

–820

–828

Credit risk of financial liabilities at fair value option, net of tax

 

 

Balance as of 1 January

0

0

Impact of ASU 2016-013

 

5

Balance as of period end

0

5

Retained earnings

 

 

Balance as of 1 January

38 682

36 449

Net income after attribution of non-controlling interests

398

462

Interest on contingent capital instruments, net of tax

–67

–41

Dividends on common shares

–1 559

–1 592

Cancellation of shares bought back

–1 005

–946

Impact of ASU 2018-023

 

–159

Impact of ASU 2016-163

 

–3

Impact of ASU 2016-013

 

342

Balance as of period end

36 449

34 512

Shareholders’ equity

34 124

27 930

 

 

 

Non-controlling interests

 

 

Balance as of 1 January

82

170

Transactions with non-controlling interests

93

688

Income/loss attributable to non-controlling interests

–5

19

Other comprehensive income attributable to non-controlling interests

 

 

Change in net unrealised investment gains/losses

 

191

Change in foreign currency translation

 

–109

Other

 

–10

Dividends to non-controlling interests

 

–152

Balance as of period end

170

797

Total equity

34 294

28 727

The accompanying notes are an integral part of the Group financial statements.