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PRUDENTIAL FINANCIAL, INC.
Notes to Consolidated Financial Statements
4. INVESTMENTS (continued)
The amortized cost and fair value of fixed maturities by contractual maturities at December 31, 2007, is as follows:
Available for Sale Held to Maturity
Amortized
Cost
Fair
Value
Amortized
Cost
Fair
Value
(in millions) (in millions)
Due in one year or less ................................................... $ 7,247 $ 7,269 $ 345 $ 349
Due after one year through five years ....................................... 26,563 27,010 11 11
Due after five years through ten years ....................................... 34,539 35,195 21 22
Due after ten years ...................................................... 47,052 48,826 1,300 1,294
Asset-backed securities ................................................... 21,554 20,459 649 658
Commercial mortgage-backed securities ..................................... 10,847 10,949 9 9
Residential mortgage-backed securities ...................................... 12,335 12,454 1,213 1,200
Total ............................................................. $160,137 $162,162 $3,548 $3,543
Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Asset-
backed, commercial mortgage-backed, and residential mortgage-backed securities are shown separately in the table above, as they are not
due at a single maturity date.
The following table depicts the sources of fixed maturity proceeds and related gross investment gains (losses), as well as losses on
impairments of both fixed maturities and equity securities:
2007 2006 2005
(in millions)
Fixed maturities, available for sale:
Proceeds from sales ................................................................. $89,466 $83,075 $77,224
Proceeds from maturities/repayments ................................................... 10,230 11,543 6,949
Gross investment gains from sales, prepayments and maturities .............................. 811 863 919
Gross investment losses from sales and maturities ......................................... (506) (749) (505)
Fixed maturities, held to maturity:
Proceeds from maturities/repayments ................................................... $ 255 $ 317 $ 462
Gross investment gains from prepayments ............................................... — — —
Fixed maturity and equity security impairments:
Writedowns for impairments of fixed maturities .......................................... $ (187) $ (54) $ (101)
Writedowns for impairments of equity securities .......................................... (75) (31) (14)
Trading Account Assets Supporting Insurance Liabilities
The following table sets forth the composition of “Trading account assets supporting insurance liabilities” at December 31:
2007 2006
Amortized
Cost
Fair
Value
Amortized
Cost
Fair
Value
(in millions) (in millions)
Short-term investments and cash equivalents .................................. $ 554 $ 554 $ 299 $ 299
Fixed maturities:
U.S. government corporations and agencies and obligations of U.S. states ....... 82 83 173 175
Foreign government bonds ............................................ 347 354 316 319
Corporate securities ................................................. 7,584 7,547 7,907 7,739
Asset-backed securities ............................................... 1,266 1,207 609 603
Commercial mortgage-backed securities ................................. 2,625 2,644 2,182 2,165
Residential mortgage-backed securities .................................. 1,147 1,136 1,933 1,905
Total fixed maturities .................................................... 13,051 12,971 13,120 12,906
Equity securities ........................................................ 1,001 948 833 1,057
Total trading account assets supporting insurance liabilities ...................... $14,606 $14,473 $14,252 $14,262
Net change in unrealized gains (losses) from trading account assets supporting insurance liabilities still held at period end, recorded
within “Asset management fees and other income” were $(143) million, $84 million and $(34) million during the years ended
December 31, 2007, 2006 and 2005 respectively.
Prudential Financial 2007 Annual Report 119