Voya 2014 Annual Report Download - page 171

Operating benefits and expenses
Interest credited and other benefits to contract owners/policyholders increased $11.3 million from $892.1
million to $903.4 million primarily due to higher group life claims, partially offset by improved retained
disability results. The current period loss ratios were lower than or within expected ranges although higher than
the prior period.
Net amortization of DAC/VOBA increased $3.4 million from $13.5 million to $16.9 million primarily due to
increased amortization resulting from terminated cases and higher gross profits on the UL block.
Operating earnings before income taxes
Operating earnings before income taxes decreased $3.3 million from $109.4 million to $106.1 million
primarily due to higher group life claims and higher DAC/VOBA amortization. Partially offsetting these items
was higher group life premiums and higher investment income, resulting from the Net gain from Lehman
Recovery/LIHTC in the current period and a loss on the sale of certain alternative investments in the prior period.
Corporate
The following table presents Operating earnings before income taxes of our Corporate segment for the
periods indicated:
Year Ended December 31,
($ in millions) 2014 2013 2012
Interest expense .................................. $(188.0) $(179.7) $(127.8)
Closed Block Variable Annuity contingent capital LOC . . . — (18.4) (56.7)
Amortization of intangibles ......................... (35.6) (35.0) (35.0)
Other ........................................... 53.2 22.5 37.2
Operating earnings before income taxes ............... $(170.4) $(210.6) $(182.3)
Our Corporate segment operating results include investment income on assets backing surplus in excess of
amounts held at the segment level, financing and interest expenses, amortization of intangibles and other items
not allocated to segments.
Corporate—Year Ended December 31, 2014 Compared to Year Ended December 31, 2013
Operating earnings before income taxes improved $40.2 million from $(210.6) million to $(170.4) million
primarily related to charges associated with our Closed Block Variable Annuity segment, including lower LOC
expenses in the current period due to the termination of the contingent capital letter of credit facility supporting
our Closed Block Variable Annuity segment in the prior period. Higher alternative investment income and lower
expenses also contributed to the improvement. Offsetting these items is an increase in Interest expense driven by
a change in debt structure during the prior period. See Liquidity and Capital Resources—Debt securities in Part
II, Item 7. of this Annual Report on Form 10-K for a description of the change in debt structure.
Corporate—Year Ended December 31, 2013 Compared to Year Ended December 31, 2012
Operating earnings before income taxes decreased $28.3 million from $(182.3) million to $(210.6) million
primarily due to an increase in interest expense and operating expenses, offset by a decrease in LOC expenses.
Interest expense increased over the period partially due to additional interest and debt issuance costs as a result of
a change in debt structure. See Liquidity and Capital Resources—Debt Securities in Part II, Item 7. of this
Annual Report on Form 10-K for a description of the change in debt structure. The increase in Operating
expenses, primarily resulting from higher variable compensation costs in the current period compared to the prior
period, was offset by lower LOC expenses in the current period due to the termination of the contingent capital
letter of credit facility supporting our CBVA segment.
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