AXA. Jean-Laurent Granier. Chairman & CEO of AXA Global P&C CEO of the Mediterranean and Latin American Region Member of the Management Committee

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1 AXA Jean-Laurent Granier Chairman & CEO of AXA Global P&C CEO of the Mediterranean and Latin American Region Member of the Management Committee March 27, 2014 Morgan Stanley European Financials Conference 2014

2 Cautionary note concerning forward-looking statements Certain statements contained herein may be forward-looking statements including, but not limited to, statements that are predictions of or indicate future events, trends, plans or objectives. Undue reliance should not be placed on such statements because, by their nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results and AXA s plans and objectives to differ materially from those expressed or implied in the forward looking statements. Please refer to the section Cautionary statements in page 2 of AXA s Document de Référence for the year ended December 31, 2013, for a description of certain important factors, risks and uncertainties that may affect AXA s business, and/or results of operations. AXA undertakes no obligation to publicly update or revise any of these forward-looking statements, whether to reflect new information, future events or circumstances or otherwise. 2 Morgan Stanley European Financials Conference 2014 March 27, 2014

3 Today s key messages Ambition AXA is on track and positioning us well for future growth Significant dividend increase supported by strong earnings momentum Zoom on high growth markets engines 3 Morgan Stanley European Financials Conference 2014 March 27, 2014

4 Ambition AXA is on track and positioning us well for future growth 4 Morgan Stanley European Financials Conference 2014 March 27, 2014

5 Ambition AXA is on track Ambition AXA Mature markets Sustainable growth in earnings & operating Free Cash Flows Selectivity High growth markets Double our size Acceleration Efficiency Everywhere with a focus on mature markets 5 Morgan Stanley European Financials Conference 2014 March 27, 2014

6 Ambition AXA: 3 years of selectivity in mature markets Less capital employed Euro 8.5 billion Disposals in mature markets since 2010* and still strong earnings growth while the top line grew modestly 3.7 FY10 Underlying earnings Mature markets 1 (in Euro billion) 3.7 FY L&S APE P&C revenues FY10-13 CAGR Mature markets +1% +1% Mature markets vs. FY10 with an improved business mix CAGR 4 CAGR CAGR +7% +8% +6% APE G/A 2 Protection & Health APE Unit-Linked P&C Direct 3 revenues -5 pts P&C current year combined ratio All notes are on page 24 of this document 6 Morgan Stanley European Financials Conference 2014 March 27, 2014 * Including disposals of non-strategic partnerships

7 Ambition AXA: 3 years of acceleration in high growth markets L&S APE P&C Revenues Underlying earnings Strong top line and earnings growth High growth markets 1 (in Euro billion) +17% CAGR % CAGR % CAGR FY10 FY10 FY10 Successfully bridged the footprint gap Buy-out of Asia L&S minorities Acquisition of HSBC s P&C businesses in Hong Kong, Singapore and Mexico #1 foreign insurer in China JVs with ICBC and Tian Ping in China Acquisition of 51% of Colpatria Seguros in Colombia* * Transaction pending, subject to customary closing conditions, including obtaining regulatory approvals All notes are on page 24 of this document 7 Morgan Stanley European Financials Conference 2014 March 27, 2014

8 Ambition AXA: 3 years of efficiency Efficiency Cost savings on track (in mature Life & Savings and P&C entities) 1 Four key levers Increase distribution efficiency In Euro billion Improve operational performance Offset increased IT investments with Business as Usual IT cost reduction FY11- FY11-FY15 expected 4 Leverage procurement savings 8 Morgan Stanley European Financials Conference 2014 March 27, 2014

9 Ambition AXA Delivering on financial objectives In Euro per share Underlying Earnings per share In Euro billion Group operating free cash flows Ambition AXA CAGR Ambition AXA cumulative +5% to +10% Euro 24 billion FY10 published FY11 published published FY11 Adjusted return on equity Debt gearing Average adjusted shareholders equity 1 (in Euro billion) % 10.0% 13.3% % 13-15% 28% 26% 26% 24% 25% 23-25% FY10 published FY11 published published Ambition AXA 2015 FY10 published FY11 published published Ambition AXA 2015 New 2015E target All notes are on page 24 of this document 9 Morgan Stanley European Financials Conference 2014 March 27, 2014

10 Ambition AXA is positioning us well for long term top line and earnings growth Sustainably growing contribution from G/A Protection & Health and Property & Casualty 1 + Substantial upside potential from Savings and Asset Management 2 In Euro billion +6%* Reported pre-tax Underlying Earnings %* 2.6 FY10 FY11 FY10 FY11 Businesses less sensitive to financial markets 1 ca. 70% of Group pre-tax Underlying Earnings Businesses more sensitive to financial markets 2 ca. 30% of Group pre-tax Underlying Earnings * Changes are on a comparable basis All notes are on page 24 of this document 10 Morgan Stanley European Financials Conference 2014 March 27, 2014

11 Drive recorder Click & Go Essential digital package E-App with well identified profitable growth drivers Higher interest rates Higher equity markets Pensions gap Macro Ageing population High growth markets Turkey Asia Latin America Economic development Withdrawal of States Africa Central & Eastern Europe Middle East Market maker Pricing power Leading positions Pay how you drive Agriculture Startup Cyber risks Self-servicing Digital Crash recorder Theft tracking Proprietary networks Reinsurance pooling AXA drive Portfolio Management Process Technical excellence Mitigation of claims inflation Protection & Health Unit-Linked Business mix Direct Operational leverage Use of Big data for price sophistication P&C commercial lines 11 Morgan Stanley European Financials Conference 2014 March 27, 2014

12 Significant dividend increase supported by strong earnings momentum and a healthy balance sheet 12 Morgan Stanley European Financials Conference 2014 March 27, 2014

13 Strong earnings and free cash flow growth in 2013 Underlying Earnings Adjusted Earnings In Euro billion In Euro billion +18% % * Net realized capital gains of Euro 434m within the Euro 300m to Euro 500m guidance Group Operating Free Cash Flows In Euro billion +12% * Remittance ratio 74% 75% Changes are at constant Forex * Comparative information related to 2012 was retrospectively restated for the amendments to IAS Morgan Stanley European Financials Conference 2014 March 27, 2014

14 translating into significant dividend growth Dividend per share In Euro Dividend growth driven by increase in Adjusted Earnings % 0.81 Long-term guidance unchanged Historical payout kept at 40% except in case of special event FY09 FY10 FY11 +12% Payout ratio of 40-50% of Adjusted Earnings net of undated debt interest charges Adjusted Earnings per share 1.81* Morgan Stanley European Financials Conference 2014 March 27, 2014 * As published

15 backed by a healthy balance sheet Economic solvency ratio* Solvency II Ready for the implementation of Solvency II starting January 1, % 199% 206% Internal model approval process on track Level II measures still under discussion G-SIIs AXA designated as 1 of the 9 Global Systemically Important Insurers Systemic Risk Management Plan and Recovery Plan to be submitted FY11 in 2014 Basic Capital Requirements (BCR) to be defined in 2014 * with US equivalence and adjusted for subsequent year dividend payment 1 Well prepared despite uncertainties around the process Debt gearing 28% 26% 26% 24% 25% Ambition AXA target achieved FY10 FY11 Ambition AXA % range in 2015E All notes are on page 24 of this document 15 Morgan Stanley European Financials Conference 2014 March 27, 2014

16 Zoom on high growth markets engines 16 Morgan Stanley European Financials Conference 2014 March 27, 2014

17 AXA high growth markets engines at a glance Central & Eastern Europe 10% Latin America 4% #X FY07 4% Life & Savings APE Euro 1,070 million Contribution to Group APE Middle East, Turkey and Africa 2% 17% Asia 85% Central & Eastern Europe 2% 1 Latin America 35% Asia 18% FY07 4% P&C Gross revenues Euro 4,520 million Contribution to Group Gross revenues Middle East, Turkey and Africa 45% 16% #1 Mexico P&C #2 Singapore P&C #1 Foreign insurer in China in L&S and in P&C 2 #2 Colombia P&C 3 #1 Turkey P&C #4 Morocco P&C #5 Gulf Region P&C Source: AXA Activity report All notes are on page 24 of this document 17 Morgan Stanley European Financials Conference 2014 March 27, 2014 #2 Indonesia L&S #1 Hong Kong P&C #4 Philippines L&S #4 Thailand L&S

18 Hong Kong, South-East Asia and India Leveraging bancassurance leadership position Life & Savings Mortality protection gap 1, 2010, USD billion 2 Property & Casualty Motor vehicles per 1,000 inhabitants 3 6, Huge growth potential India Indonesia Thailand Malaysia India Philippines Indonesia Hong Kong Malaysia France AXA Asia APE Underlying Earnings FY10-13 CAGR +40% +32% Hong Kong regional hub = ONE AXA Asia 1 customer view brand operating & servicing platform Gross revenues Underlying Earnings In Euro million FY10-13 CAGR +30% 58-4 FY10 AXA s top class bancassurance partners Strong Competitive assets All notes are on page 24 of this document 18 Morgan Stanley European Financials Conference 2014 March 27, 2014

19 China #1 foreign insurer in Life and Property & Casualty ICBC-AXA Life AXA-Tian Ping July 2012: launch of the new joint-venture* World s #2 motor insurance market in % GWP CAGR over the past 8 years for motor insurance market Low P&C penetration rate (1.3% of GDP vs 3.4% of GDP for the Eurozone) 3 APE 100% share In Euro million 260 Gross revenues In Euro million player to enter the Direct market 1 st in China 50% CAGR 447 FY % Market share 1 1.0% FY06 FY15E Strong focus on Protection & Health at good NBV margin Among the first 3 insurers with a national telemarketing license Already breakeven in Euro 0.4 billion investment expected over Target of 80% direct premiums by 2020 * AXA Group share decreased from 51% to 27.5% in July 2012 All notes are on page 24 of this document 19 Morgan Stanley European Financials Conference 2014 March 27, 2014

20 Middle East, Turkey and Africa Well diversified footprint in high potential markets Middle East Low insurance penetration High relative proportion of the middle wealth bracket Ca. 13% Turkey Non life market premium CAGR Low penetration rate (1.2% vs 3.4% on average in the Eurozone) 1 AXA Gulf regional hub leveraging shared services and platforms 2.0% Developing profitable and fast growing businesses in 5 countries: Saudi Arabia, UAE, Oman, Bahrain, Qatar 24% AXA gross revenues CAGR over the past 8 years 2.0% Africa Non Life insurance penetration 1 1.5% 0.9% 0.6% 0.5% 0.4% 3.4% Market leader Price maker Cost efficient 25% 2 market share in Motor price increases in TPL in % Net New Contracts 227k 22% enlarged expense ratio 3 Kenya Morocco Tunisia Angola Algeria Nigeria Egypt Eurozone Strong positions in Morocco and Algeria with total gross revenues of Euro 0.3 billion Profitable 97% current year combined ratio Leading positions in Senegal, Ivory Coast, Cameroun and Gabon with total gross revenues of Euro 0.1 billion All notes are on page 24 of this document 20 Morgan Stanley European Financials Conference 2014 March 27, 2014

21 Latin America Bridging the footprint gap Macro economy Mexico Acquired from ING in 2008 Life Non Life Insurance penetration 8.9% 5.6% Successful transformation ongoing Gross revenues +18% CAGR 1,885 In Euro million Underlying Earnings % 0.9% 1.1% 2.4% 0.8% 1.7% 3.7% 2.0% 1.7% 3.3% 824 FY08 1 FY08 Mexico Colombia Brazil France Colombia 1 Source: Swiss Re, sigma No 3/2013 Estimated Commercial lines market size 2015 vs Entering #5 insurance market in Latin America Acquisition of 51% of Colpatria s insurance operations #4 multi-line insurance player and #2 Property & Casualty insurer 2 Brazil Brazil Mexico Argentina Chile 2010 Euro 1 billion 2015 Euro 1 billion Source: AXCO, AXA estimates Targeting commercial lines Euro 0.1 billion investment in P&C greenfield operations in most profitable commercial lines Leveraging AXA Corporate Solutions new hub to access large corporates in Latin America All notes are on page 24 of this document 21 Morgan Stanley European Financials Conference 2014 March 27, 2014

22 Concluding remarks 2013 Successful roll-out of Ambition AXA Delivering on our Ambition AXA strategy while preparing for the future Property & Casualty Commercial Lines, Direct Life & Savings Individual Protection & Health, Employee Benefits and Unit-Linked 2014 Continuing the transformation journey Digital Further embed digital technologies in the business Data A driver behind the client service revolution Asset Management Growth acceleration, diversification and development of third party clients Executing our operational priorities Talent Adapting to changing behaviors, needs & expectations of our clients, attracting new skills Ensuring digital transformation 22 Morgan Stanley European Financials Conference 2014 March 27, 2014

23 Q&A session Q&A session 23 Morgan Stanley European Financials Conference 2014 March 27, 2014

24 Notes Page 6 1. Life & Savings and Property & Casualty only 2. General Account 3. Direct P&C operations in UK, France, Belgium, Spain, Portugal, Italy, Poland, South Korea and Japan 4. Compound annual growth rate Page 7 1. High growth markets for Life & Savings: APE and NBV (on a Group share basis): Morocco, Mexico, Turkey, Singapore, Indonesia, Thailand, Philippines, China, India, Hong Kong, Poland, Czech Republic, Hungary; Revenues (on a 100% share basis): Morocco, Mexico, Turkey, Singapore, Indonesia (excl. bancassurance entity), Hong Kong, Poland, Czech Republic, Hungary, Slovakia; Underlying Earnings, Adjusted Earnings, Net Income (on a Group share basis): Morocco, Mexico, Turkey, Singapore, Indonesia, Thailand, Philippines, China, India, Hong Kong, Poland, Czech Republic, Hungary, Slovakia. High growth markets for P&C: Revenues and Combined ratio (on a 100% share basis): Morocco, Mexico, Turkey, Gulf, Singapore, Malaysia, Hong Kong, Ukraine; Underlying Earnings, Adjusted Earnings, Net Income (on a Group share basis): Morocco, Lebanon, Mexico, Turkey, Gulf, Singapore, Malaysia, Hong Kong, Ukraine, Russia. Page 9 1. Average shareholders equity excluding undated debt and reserves related to change in fair value Page Includes G/A Protection & Health, Property & Casualty and International Insurance. 2. Includes G/A Savings, Unit-Linked, Mutual funds & Other, Asset Management and Banking. Page FY11 Economic Solvency adjusted for FY11 dividend paid in Economic Solvency adjusted for dividend paid in Economic Solvency adjusted for dividend to be proposed at the Shareholders Annual General Meeting that will be held on April 23, Page Excluding Colombia. Transaction pending, subject to customary closing conditions, including obtaining regulatory approvals. 2. Source: China Insurance Regulatory Commission (CIRC) 3. Source: Superintendencia Financiera de Colombia publicly available information Page The Mortality protection gap is measured as the difference between the income needed to maintain living standards for a person s dependents and the sum of savings and life insurance in force available to them after the breadwinner s death. 2. Source: Swiss Re Mortality Protection Gap: Asia-Pacific Source: World Bank, figure for Indonesia and 2009 figure for India. Page Source: China Insurance Regulatory Commission (CIRC) 2. Source: McKinsey China Motor Insurance Industry Report 3. Source: Swiss Re, sigma No 3/2013 Page Sources: Swiss Re, sigma No 3/2009 and Swiss Re, sigma No 3/ Source: Turkish insurance Association (TSB), 9M13 statistics 3. Enlarged Expense Ratio is the sum of Expense ratio and Claims handling costs ratio Page Transaction pending, subject to customary closing conditions, including obtaining regulatory approvals. 2. Source: Superintendencia Financiera de Colombia publicly available information 24 Morgan Stanley European Financials Conference 2014 March 27, 2014