Prudential 2005 Annual Report Download - page 159

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PRUDENTIAL FINANCIAL, INC.
Notes to Consolidated Financial Statements
20. SEGMENT INFORMATION (continued)
The summary below presents total assets for the Company’s reportable segments at December 31,
Assets
2005 2004 2003
(in millions)
Individual Life and Annuities .......................................................... $ 89,313 $ 84,498 $ 77,313
Group Insurance .................................................................... 27,466 24,250 20,898
Total Insurance Division .......................................................... 116,779 108,748 98,211
Asset Management .................................................................. 29,600 24,795 27,124
Financial Advisory .................................................................. 1,929 1,151 2,805
Retirement ......................................................................... 119,259 116,593 59,268
Total Investment Division ......................................................... 150,788 142,539 89,197
International Insurance ............................................................... 54,185 57,761 45,989
International Investments ............................................................. 4,903 4,425 3,883
Total International Insurance and Investments Division .................................. 59,088 62,186 49,872
Corporate Operations ................................................................. 17,583 14,833 14,289
Real Estate and Relocation Services ..................................................... 1,053 942 969
Total Corporate and Other ......................................................... 18,636 15,775 15,258
Total Financial Services Businesses ..................................................... 345,291 329,248 252,538
Closed Block Business ............................................................... 72,485 71,580 68,736
Total .......................................................................... $417,776 $400,828 $321,274
21. COMMITMENTS AND GUARANTEES, CONTINGENT LIABILITIES AND LITIGATION AND
REGULATORY MATTERS
Commitments and Guarantees
The Company occupies leased office space in many locations under various long-term leases and has entered into numerous
leases covering the long-term use of computers and other equipment. Rental expense, net of sub-lease income, incurred for the years
ended December 31, 2005, 2004 and 2003 was $192 million, $199 million and $308 million, respectively.
The following table presents, at December 31, 2005, the Company’s contractual maturities on long-term debt, as more fully
described in Note 11, and future minimum lease payments under non-cancelable operating leases along with associated sub-lease
income:
Long-term
Debt
Operating
Leases
Sub-lease
Income
(in millions)
2006 .............................................................................. $ — $192 $ (41)
2007 .............................................................................. 324 169 (39)
2008 .............................................................................. 1,438 131 (31)
2009 .............................................................................. 33 107 (27)
2010 .............................................................................. 69 83 (16)
Beyond 2010 ....................................................................... 6,406 245 (22)
Total .............................................................................. $8,270 $927 $(176)
For business reasons, the Company exits certain non-cancelable leases prior to their expiration. In these instances, the
Company’s policy is to accrue, at the time it ceases to use the property being leased, the future rental expense and any sub-lease
income immediately and release the reserve over the remaining commitment in the year that it is due. Of the $927 million in total
non-cancelable operating leases and $176 million in total sub-lease income, $205 million and $142 million, respectively, has been
accrued at December 31, 2005.
In connection with the Company’s commercial mortgage operations, it originates commercial mortgage loans. At
December 31, 2005, the Company had outstanding commercial mortgage loan commitments with borrowers of $1,874 million. In
certain of these transactions, the Company prearranges that it will sell the loan to an investor after the Company funds the loan. As
of December 31, 2005, $511 million of the Company’s commitments to originate commercial mortgage loans are subject to such
arrangements.
Prudential Financial 2005 Annual Report 157