Prudential 2006 Annual Report Download - page 10

Executive Officers
Arthur F. Ryan
Chairman of the Board,
Chief Executive Officer
and President
Vivian L. Banta
Vice Chairman,
Insurance Division
(Retiring April 2007)
Mark B. Grier
Vice Chairman,
Financial Management
Rodger A. Lawson
Vice Chairman,
International Insurance
and Investments Division
John R. Strangfeld Jr.
Vice Chairman,
Investment Division
Robert Charles Golden
Executive Vice President,
Operations and Systems
Susan L. Blount
Senior Vice President
and General Counsel
Richard J. Carbone
Senior Vice President
and Chief Financial Officer
Sharon C. Taylor
Senior Vice President,
Corporate Human Resources
Board of Directors
Frederic K. Becker
President, Wilentz
Goldman & Spitzer, P.A.
Gordon M. Bethune
Former Chairman of
the Board, Chief Executive
Officer and President,
Continental Airlines, Inc.
Gaston Caperton
President, The College Board
Gilbert F. Casellas
Member, Mintz Levin Cohn
Ferris Glovsky and Popeo, P.C.
James G. Cullen
Retired President and
Chief Operating Officer,
Bell Atlantic Corporation
William H. Gray III
Chairman, The Amani
Group, LLC
Jon F. Hanson
Chairman, The Hampshire
Companies
Constance J. Horner
Former Assistant to the
President of the United States
Karl J. Krapek
Retired President and Chief
Operating Officer, United
Technologies Corporation
Christine Poon
Vice Chair and Worldwide
Chair, Medicines and
Nutritionals, Johnson &
Johnson
Arthur F. Ryan
Chairman of the Board,
Chief Executive Officer
and President, Prudential
Financial, Inc.
James A. Unruh
Founding Member, Alerion
Capital Group, LLC
PRUDENTIAL OFFICERS AND DIRECTORS
(1) We measure our Return on Equity (ROE) based on after-tax adjusted operating income and attributed equity of our Financial Services Businesses,
which is referred to as “Operating return on average equity” on page 6. Adjusted operating income, which is not measured in accordance with accounting
principles generally accepted in the United States of America (GAAP), excludes “Realized investment gains (losses), net,” as adjusted, and related charges
and adjustments. A significant element of realized losses is impairments and losses from sales of credit-impaired securities, the timing of which depends
largely on market credit cycles and can vary considerably across periods. The timing of other sales that would result in gains or losses is largely subject to
our discretion and influenced by market opportunities. Realized investment gains (losses) representing profit or loss of certain of our businesses which
primarily originate investments for sale or syndication to unrelated investors, and those associated with terminating hedges of foreign currency earnings
and current period yield adjustments are included in adjusted operating income. Realized investment gains and losses from products that are free standing
derivatives or contain embedded derivatives, and from associated derivative portfolios that are part of an economic hedging program related to the risk
of those products, are included in adjusted operating income. Adjusted operating income also excludes investment gains and losses on trading account
assets supporting insurance liabilities and changes in experience-rated contractholder liabilities due to asset value changes, because these recorded changes
in asset and liability values will ultimately accrue to contractholders. Trends in the underlying profitability of our businesses can be more clearly identified
without the fluctuating effects of these transactions. In addition, adjusted operating income also excludes the results of divested businesses, which are not
relevant to our ongoing operations, and certain other items, described elsewhere herein. We believe that the presentation of adjusted operating income
as we measure it for management purposes enhances understanding of the results of operations of the Financial Services Businesses by highlighting the
results from ongoing operations and the underlying profitability of our businesses. However, adjusted operating income is not a substitute for income
determined in accordance with GAAP, and the excluded items are important to an understanding of our overall results of operations. Because we do not
predict future realized investment gains / losses or recorded changes in asset and liability values that will ultimately accrue to contractholders, we cannot
provide a measure of our goals based on income from continuing operations of the Financial Services Businesses, which is the GAAP measure most
comparable to adjusted operating income.
All facts and figures as of December 31, 2006, unless otherwise noted.
“Prudential”®, “Prudential Financial”®, “The Rock”®,®and “Growing and Protecting Your Wealth”®are registered service marks of
The Prudential Insurance Company of America.
Securities products offered by Prudential Investment Management Services, LLC, American Skandia Marketing, Incorporated, and Pruco Securities, LLC
(all members SIPC).
Insurance issued by The Prudential Insurance Company of America and American Skandia Life Assurance Corporation.
All are Prudential Financial companies, and each is responsible for its own financial condition and contractual obligations.
PRUDENTIAL FINANCIAL, INC. 2006 ANNUAL REPORT
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