Prudential 2007 Annual Report Download - page 59

We determine a target asset mix for each product class, which we reflect in our investment policies. Our asset/liability management
process has permitted us to manage interest-sensitive products successfully through several market cycles.
Portfolio Composition
Our investment portfolio consists of public and private fixed maturity securities, commercial loans, equity securities and other
invested assets. The composition of our general account reflects, within the discipline provided by our risk management approach, our need
for competitive results and the selection of diverse investment alternatives available primarily through our Asset Management segment.
The size of our portfolio enables us to invest in asset classes that may be unavailable to the typical investor.
Our total general account investments were $232.5 billion and $229.7 billion as of December 31, 2007 and December 31, 2006,
respectively, which are segregated between the Financial Services Businesses and the Closed Block Business. Total general account
investments attributable to the Financial Services Businesses were $163.0 billion and $159.6 billion as of December 31, 2007 and
December 31, 2006, respectively, while total general account investments attributable to the Closed Block Business were $69.5 billion and
$70.1 billion as of December 31, 2007 and December 31, 2006, respectively. The following table sets forth the composition of the
investments of our general account as of the dates indicated. The average duration of our general account investment portfolio attributable
to the domestic Financial Services Businesses as of December 31, 2007 is between 4 and 5 years.
December 31, 2007
Financial
Services Businesses
Closed
Block Business Total % of Total
($ in millions)
Fixed Maturities:
Public, available for sale, at fair value ................................... $ 90,962 $37,168 $128,130 55.1%
Public, held to maturity, at amortized cost ................................ 2,879 — 2,879 1.2
Private, available for sale, at fair value ................................... 20,313 12,246 32,559 14.0
Private, held to maturity, at amortized cost ................................ 669 — 669 0.3
Trading account assets supporting insurance liabilities, at fair value ................ 14,473 — 14,473 6.2
Other trading account assets, at fair value ..................................... 204 142 346 0.2
Equity securities, available for sale, at fair value ............................... 4,629 3,940 8,569 3.7
Commercial loans, at book value ........................................... 19,603 7,954 27,557 11.9
Policy loans, at outstanding balance ......................................... 3,942 5,395 9,337 4.0
Other long-term investments(1) ............................................ 2,724 1,268 3,992 1.7
Short-term investments(2) ................................................. 2,598 1,385 3,983 1.7
Total general account investments ...................................... 162,996 69,498 232,494 100.0%
Invested assets of other entities and operations(3) .............................. 10,613 — 10,613
Total investments ................................................... $173,609 $69,498 $243,107
December 31, 2006
Financial
Services Businesses
Closed
Block Business Total % of Total
($ in millions)
Fixed Maturities:
Public, available for sale, at fair value ................................... $ 92,802 $38,752 $131,554 57.3%
Public, held to maturity, at amortized cost ................................ 3,025 — 3,025 1.3
Private, available for sale, at fair value ................................... 18,336 12,021 30,357 13.2
Private, held to maturity, at amortized cost ................................ 443 — 443 0.2
Trading account assets supporting insurance liabilities, at fair value ................ 14,262 — 14,262 6.2
Other trading account assets, at fair value ..................................... 109 — 109 0.1
Equity securities, available for sale, at fair value ............................... 4,314 3,772 8,086 3.5
Commercial loans, at book value ........................................... 17,275 7,318 24,593 10.7
Policy loans, at outstanding balance ......................................... 3,472 5,415 8,887 3.9
Other long-term investments(1) ............................................ 2,791 965 3,756 1.6
Short-term investments(2) ................................................. 2,752 1,851 4,603 2.0
Total general account investments ...................................... 159,581 70,094 229,675 100.0%
Invested assets of other entities and operations(3) .............................. 5,742 — 5,742
Total investments ................................................... $165,323 $70,094 $235,417
(1) Other long-term investments consist of real estate and non-real estate related investments in joint ventures (other than our investment in operating joint
ventures, which includes our investment in Wachovia Securities) and partnerships, investment real estate held through direct ownership and other
miscellaneous investments.
(2) Short-term investments consist primarily of money market funds, with virtually no sub-prime exposure.
Prudential Financial 2007 Annual Report 57