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2 ABOUT THIS FINANCIAL STRENGTH ASSESSMENT This AKG report and the analysis and ratings contained within it provide assessment of financial strength and associated considerations. Financial Strength is focused on the ability of a company to deliver ongoing operational capability in the interest of its customers and in line with their fairly held expectations. AKG s perspective in the assessment of financial strength is wholly that of a customer of a product or service. From that foundation, this analysis is specifically designed to inform financial advisers and assist in their required understanding of a company s operational financial strength. Given the underlying customer perspective, the financial strength of companies needs to be focused at an operational level, specifically on the company that is effecting the product or service that a customer is selecting. This is important, because from the customer s perspective it is that company that needs to survive in a form that maintains the requisite operational characteristics to meet their fairly held requirements. And it is thus at this level that the selection needs of the customers advisers must be met. This contrasts to credit rating, which will be undertaken at group or parent company level where investment or debt placement etc. is made. Further details on how analysis is undertaken is provided at the end of this report and may also be obtained from AKG. TABLE OF CONTENTS Company Analysis Rating & Assessment Commentary... 3 Ratings... 3 Summary... 3 Commentary... 4 Group & Parental Context... 6 Background... 6 Group Structure (simplified)... 7 Company Analysis: Standard Life Savings Ltd... 8 Basic Information... 8 Operations... 9 Strategy Key Company Financial Data Guide Introduction Rating Definitions About AKG CONTACT INFORMATION AKG Financial Analytics Ltd, Anderton House, 92 South Street, Dorking, Surrey, RH4 2EW Tel: +44 (0) Web: Guide AKG Financial Analytics Ltd 2 10 April 2018

3 Rating & Assessment Commentary Rating & Assessment Commentary RATINGS Overall Financial Strength PLATFORM SECTOR SUPERIOR STANDARD LIFE SAVINGS LTD A Supporting Ratings Group & Parental Context Company Analysis Service Image & Strategy Business Performance Standard Life Savings Ltd SUMMARY August 2017 saw the merger of Standard Life plc and Aberdeen Asset Management plc, forming Standard Life Aberdeen plc Standard Life Savings Ltd is part of this strong group with a longstanding track record of activity and support for the UK intermediated sector Platforms appear to remain a core part of the overall proposition of the enlarged group and have been emphasised as core to what will be retained following completion of the proposed sale of the insurance businesses to, and strategic partnership with, Phoenix (announced February 2018) The acquisition and inclusion of Elevate have been successfully delivered and represent an underlining of the organisation's strategy Standard Life Wrap and Elevate set to remain as separate propositions, with Standard Life Wrap aimed at the more sophisticated investment-led end of the platform market and Elevate targeting the broader financial planning market Whilst always subject to a development context and the complexities of a group recharging environment, a second year of standalone profits for Standard Life Savings Ltd is a welcome waypoint in its maturity Guide AKG Financial Analytics Ltd 3 10 April 2018

4 Rating & Assessment Commentary Group & Parental Context COMMENTARY Financial Strength Ratings Standard Life Savings Ltd The group has shown a commitment to platforms, by virtue of significant financial resource allocation and management focus which had been consistent in recent years, and has been further underlined and augmented by the acquisition of Elevate. Accelerate, for example, a 30m investment programme of platform developments for 2016, delivered a range of enhancements and support, ensuring that Standard Life Wrap was ready for Pension Freedoms. The financial strength of the platform operation is closely linked to that of the wider group from which it draws its ongoing development capital and for which it provides a core integrated component. Now as part of a larger group, Standard Life Aberdeen, this commitment to continue investing in the appropriate technology, wider infrastructure and capital, in line with the original business plan for the short to medium term, remains. AKG regards Standard Life Savings Ltd (SLSL) as an important component of a group whose capital position has remained relatively resilient to volatile market movements, maintaining a good level of overall surplus capital. The platform operation appears to have benefited from this and developed a significant 'trusted business partner' proposition for advisers operating post-rdr. Service Rating Along with the group s life company, the Wrap benefits from a track record and reputation for strong customer service and articulates a very client centric approach in administration. Proof point for this over the years of its development have been numerous awards and external benchmarks, in tandem with its own positive internal service metrics. The Wrap platform is now operating at scale and crucially is built, and has been managed since its establishment and when it was smaller in terms of AuA, in such a way as to deliver levels of governance and administrative ease with a far greater throughput of activity and assets. Company Analysis Whilst kept separate in many respects, the Elevate acquisition does still raise administrative and resource issues for the business and, whilst the business has reported progress without diminution of its service in Wrap and has continued to win awards (which indicate adviser perception), this does remain a challenge. Image & Strategy Rating The group has a long pedigree in the UK Long Term Savings market and is committed to its platform proposition, viewing its platform as key to growth in its UK retail business, given the ongoing demand and adoption for such infrastructure to sit at the core of adviser businesses and meet regulatory requirements effectively. Organic growth for the platform continues both in terms of adviser firms using the platform and AuA. However, the acquisition of the Elevate platform from AXA adds significantly further scale and cost effectiveness to the overall Aberdeen Standard Life platform footprint with, for example, thought leadership investment created at a group level and then leveraged across both Wrap and Elevate brands. The group believes that its brand and distribution reach together with increasing diversification and global reach will be key factors in its future success. Guide In terms of scalability and capacity in the UK, Aberdeen Standard Life suggests that its platform offering which now includes the Elevate component can support an unlimited number of clients and advisers, e.g. that it has been designed (and tested) with both horizontal and vertical capacity and scalability, built into the infrastructure. It has shown versatility, for instance, with the RBS partnership where Aberdeen Standard Life powers RBS s non-advisory, direct-to-consumer online platform. The platform businesses remain firmly in the centre of the group's broader proposition and are fundamentally, culturally and financially supported by their parent, which itself continues to perform strongly. The platform operation is maintaining AKG Financial Analytics Ltd 4 10 April 2018

5 Rating & Assessment Commentary a good reputation alongside other positive performers in the intermediary markets post-rdr, and is expected to continue to be a major presence. In addition, it sees adjacent opportunities in the Private Client (DFM/DIM accessible) and workplace (corporate) markets. The evolving integration and positioning of the Elevate platform will be the key element of operations strategy in the near term. UK strategy also includes the acquisition and development of its own advisory capability, under the 1825 brand, as part of an approach that looks to leverage capabilities across an increased number of integrated routes to market and increasingly acquire, grow and retain customers across these. The investment management business continues a strong association with the Ryder Cup golf competition, through its position as Worldwide Sponsor, partnering in both the UK and USA. Business Performance Rating The platform continued to grow in 2016, with total AuA growing by 24% to 32.9bn [2015: 26.5bn]. Group & Parental Context An integral part of the overall group offering, embellished by the acquisition of Elevate, this position is set to continue following the merger at parental level. SLSL also reported a second year of profit after a number of loss making years. Standard Life plc (now Standard Life Aberdeen plc) reported increased assets under administration, operating profits and cash generation, albeit there was a net outflow of funds. This has been overshadowed by the announcement and subsequent completion of the merger of Standard Life and Aberdeen Asset Management, which is expected to provide further growth opportunities. Guide Company Analysis AKG Financial Analytics Ltd 5 10 April 2018

6 BACKGROUND Group & Parental Context Standard Life Aberdeen plc was formed in August 2017 from the merger of Standard Life plc and Aberdeen Asset Management plc and is a UK based financial services group focused on providing long-term savings and investment solutions on a global basis. It operates in the UK, Europe, North America, Asia and Australia through brands which currently include Aberdeen Standard Investments, Standard Life and Standard Life Wealth as well as some joint venture brands. It has around 4.5m customers worldwide, and a further 25m through its joint venture in China (Heng An Standard Life) and Associate in India (HDFC Life and HDFC Asset Management Company Ltd - HDFC AMC). The Life Insurance Company of Scotland was founded in Edinburgh in It was renamed as The Standard Life Assurance Company (SLAC) in 1832 and reincorporated as a mutual assurance company in Standard Life Investments was established in 1998 and Standard Life entered the offshore market with the launch of the Dublin based subsidiary, Standard Life International Ltd in January Following the demutualisation of The Standard Life Assurance Company (SLAC) and the flotation of Standard Life plc on the London Stock Exchange on 10 July 2006, Standard Life Assurance Ltd (SLAL) operates in the UK alongside its now considerably smaller subsidiary, Standard Life Pension Funds Ltd (SLPF). Under the terms of the proposed deal with Phoenix (as at February 2018), however, these life businesses will be sold out from the group. The Standard Life Wrap is provided by Standard Life Savings Ltd (SLSL), the focus of this report. Other key businesses are Aberdeen Standard Investments, the group's fund management arm, which also acquired Ignis Asset Management from Phoenix in July 2014, and Standard Life Wealth Ltd (SLW), the discretionary fund manager, which acquired the private client business of Newton Management Ltd (NML) in September Standard Life's Canadian business was sold to Manulife in January In May 2015, Standard Life acquired Pearson Jones from Skipton Building Society. This was then rebranded as 1825 and now operates as a restricted national advice service. Standard Life has subsequently announced the acquisitions of regional financial planning businesses The Munro Partnership, Baigrie Davies and Jones Sheridan to further bolster the 1825 proposition. In November 2016, the platform provider, AXA Portfolio Services Ltd - renamed as Elevate Portfolio Services Ltd (EPSL), was acquired from AXA. Aberdeen Asset Management was founded in 1983 and listed in In 2005, it acquired the UK and US institutional businesses of Deutsche Asset Management, including a unit linked group pension vehicle, renamed as Aberdeen Asset Management Life and Pensions Ltd. Certain parts of Credit Suisse's Global Investors fund management business were acquired in July 2009 and Aberdeen Asset Management also acquired parts of RBS Asset Management in April 2014 saw the acquisition of Scottish Widows Investment Partnership (SWIP). In January 2016, the purchase of the platform provider Parmenion Capital Partners LLP, along with its online advice business sister company, Self Directed Holdings Ltd, was completed. The merged group reports a stable Solvency II position. In February 2018, Scottish Widows and Lloyds Banking Group s Wealth businesses announced that they were reviewing their asset management arrangements and that they had therefore given notice to Standard Life Aberdeen plc to terminate their partnership agreements with Aberdeen Asset Management plc. This includes long-term contracts for the management of over 100bn of assets. In February 2018, Standard Life Aberdeen plc also announced the sale of its insurance business and an enhanced longterm strategic partnership with Phoenix Group. At the same time, it confirmed that it would retain its adviser platforms (Wrap, Elevate and Parmenion). AKG Financial Analytics Ltd 6 10 April 2018

7 GROUP STRUCTURE (SIMPLIFIED) AKG Financial Analytics Ltd 7 10 April 2018

8 Standard Life Savings Ltd PLATFORM SECTOR Company Analysis: Standard Life Savings Ltd BASIC INFORMATION Ownership & Control Standard Life Aberdeen plc Year Established 1997 Country of Registration UK Head Office Standard Life House, 30 Lothian Road, Edinburgh EH1 2DH Contact Key Personnel Role Group Co-Chief Executive Officer Group Co-Chief Executive Officer Group Chief Financial Officer Group Chief Investment Officer Group Chief People Officer Group Chief Operations Officer and Joint Head of Integration Joint Head of Integration Chief Executive Officer, Pensions and Savings Chief Executive Officer, Standard Life Wealth Director of Propositions Managing Director, Customer Services Head of Adviser & Wealth Management Propositions Head of Financial Planning and Performance Customer Operations Director Head of Risk, Control & Regulatory Services Director of UK Distribution Name N K Skeoch M Gilbert B Rattray R Paris K Christie C Walklin A Laing F A O'Dwyer R A Charnock E Reynolds J G McGuigan D Tiller A Warner S Fennessey S MacLennan N Butwell Company Background Established in 1997, SLSL is the operator of the Standard Life Wrap platform in the UK, which was launched in May SLSL also runs the FundZone proposition (its fund supermarket). In addition, the company acts as a PEP and ISA manager. In October 2016, SLSL acquired AXA Portfolio Services Ltd (renamed as Elevate Portfolio Services Ltd - EPSL), which operates the Elevate platform. AKG Financial Analytics Ltd 8 10 April 2018

9 Standard Life Savings Ltd PLATFORM SECTOR OPERATIONS Governance System and Structure SLSL has its own board with non-executive Directors and Risk Committee. It has a mirror structure with EPSL, with the same Directors sitting on each Board and both currently report into the SLAL Board which reports into the Group Board. The Group Board states that it adheres to the highest standards of corporate governance and ethical behaviour in directing the Group s affairs and in its accountability to shareholders. The directors believe that these commitments are key to understanding and managing the business effectively, providing engaged leadership, and delivering shareholder value over the longer term. The Group Board takes the quality of its performance seriously and strives to improve performance through annual reviews and continuing self-assessment. As well as its key activities to oversee the composition of the Group Board and its effectiveness, during 2016 it: Reviewed and revised the composition of the boards of its principal subsidiaries, currently Standard Life Assurance Ltd (SLAL) and Standard Life Investments (Holdings) Ltd (SLIH) Established the Investment Committee to support the Group Board in its oversight role. Risk Management Risk management is carried out within the Group's Enterprise Risk Management (ERM) framework with responsibilities allocated to individuals within the businesses. The platform sits within the UK business of the Group. The structure within the UK business is channel focused (Adviser, Workplace and Customer) and so responsibility for the platform sits with the Corporate, Retail & Wholesale Managing Director, providing a single point of responsibility and accountability within the platform, consistent with governance in other channels. The Asset Administration Business Centre (AABC) sits at the heart of its investment governance, providing the process delivery control model and oversight. The main risks facing SLSL are market, credit, liquidity, operational and conduct. SLSL operates a 3 lines of defence (3LD) model. Within the 1st line, the Asset Administration Business Centre (AABC) provides the process delivery control model and oversight with 3 main focuses: Operational Processes - performance & oversight of operational process to agreed SLAs including the day-to-day outsourced investment transaction and custody processing Platform Performance - oversight of platform performance, platform functionality, speed and availability Risk & Control Environment - managing any issues, breaches and emerging risks in the investment operation. Administration The group has invested significantly in its platform service capabilities, which are based on electronic self-service and maximising 'straight through processing' with a focus on the end customers. It acknowledges a commitment to sustainability and support over a 5-15 year client lifecycle. The AABC was established to deliver, over the asset life cycle, the investment processes that are not outsourced, and to have oversight control of those that are. Internal data confirms positive performance in most key areas. There are Platform Consultants to guide intermediaries and show them how to maximise platform functionality. Around 100 Platform Relationship Managers are out in the field in the UK, with 80% of them Level 5 qualified. AKG Financial Analytics Ltd 9 10 April 2018

10 Standard Life Savings Ltd PLATFORM SECTOR Benchmarks The group has been recognised by the industry numerous times in recent years and it has a Defaqto 5 Star Platform Rating. It was UK Platform Awards Best Platform Provider (AUM over 12.5bn/ 15bn) 2014, 2015, 2016 and It was awarded Best Platform for Adviser Service and Best use of Platform Technology at the Aberdeen UK Platform Awards Standard Life Wrap has been recognised for its service in respect of the platform with a Defaqto Gold Service Rating in 2016 and Whilst Standard Life Wrap was rated at Silver in 2018, Elevate was awarded a Gold Rating. Outsourcing FNZ (UK) Ltd (FNZ) is the UK element of an international platform technology business, and was established in the UK in It has provided technology for the Standard Life Wrap proposition for several years as well as being administrator of the investment transactions and sub-custodian of platform assets. FNZ also acts as a technology provider for other UK platforms, including Elevate. Nominees: FNZ (UK) Nominees Ltd Custodian: FNZ (UK) Ltd STRATEGY Market Positioning The platform is provided under the Standard Life brand to its core intermediary market and has benefited from the life company's established footprint in this respect, with significant long-standing relationships with intermediary firms and significant distribution capability to support growth via the platform. It is an integral part of Aberdeen Standard Life's UK Retail proposition and so leverages expertise from its position within the value chain and access to investment solutions. Aberdeen Standard Life has stated that Elevate will currently continue as a distinct platform proposition. Since acquisition, further work has been undertaken to maintain and extend this differentiation between the Standard Life Wrap and Elevate platform propositions. Further branding work to underscore this element of differentiation is to be anticipated, as the wider business looks to position the two platforms within a single digital approach. Proposition In simple terms this defines the respective propositions as: Standard Life Wrap: to focus on Wealth Advisory and Private Client markets increasingly addressing the complexity amongst a HNW client base underpinned by technology. Elevate: open access delivery to financial planners amongst their increased volume of affluent clients matching a simple technology led service. Now considered an established player in the market, SLSL has continued to show significant growth in terms of Assets under Administration (AuA). The platform is positioned as very much an adviser led proposition and as at 30 June 2017 was supporting around 1,500 adviser firms and over 250,000 clients. The Standard Life Wrap provides access to over 2,750 funds from over 150 fund managers, with 23 asset classes and many other investment options, including ETFs and structured products. Portfolio modelling is provided through its own portfolio planning tool (other off-the-shelf portfolios are available), and SLW provides comprehensive DFM (or DIM - Discretionary Investment Manager) capability. White-labelling is available for those advisers who require this. Additional external tools are available such as: risk profiling (from ORRA - Oxford Risk Research Analysis); portfolio analysis / planning (Willis Towers Watson); data feeds and fund factsheets (Financial Express); fund analysis (Morningstar); and news feeds / equity pricing (Reuters). SLSL states that it was the first major platform to remove all fund rebates and commissions well ahead of the 2016 regulatory deadline. AKG Financial Analytics Ltd April 2018

11 Standard Life Savings Ltd PLATFORM SECTOR Managed model portfolios are offered from a wide range of investment managers. Free access is given to a proprietary cashflow planning tool, the Retirement LifePlanning calculator, which has also been launched to support advisers with retirement income planning discussions with clients. KEY COMPANY FINANCIAL DATA Last 3 reporting periods up to 31 December 2016 Capital Resources Disclosures Available capital resources Capital resources requirement (CRR) Excess capital resources CRR coverage ratio (%) The Capital Resources Requirement (CRR) for SLSL increased again in 2016 as the company grew (this calculated on the Fixed Overhead Requirement basis). Available capital resources, however, increased significantly primarily benefitting from the capital injection, but also retained profit, leading to an increase in the CRR ratio from 466.9% to 658.5%. Common with other subsidiary companies there are internal CRR targets for SLSL, and the capital position is managed to comply with those targets and minimum regulatory requirements. Going forwards, disclosure is at a consolidated 'Standard Life Savings Group' level, which includes SLSL and EPSL. Standard Life Aberdeen plc reported a Solvency II surplus of 3.8bn and 3.6bn on an investor and a regulatory review respectively as at 31 December 2017 [31 December 2016: 3.3bn and 3.1bn]. The associated coverage ratios were 225% and 197% [31 December 2016: 214% and 177%]. Statement of Financial Position Assets Current liabilities (12.3) (8.2) (18.7) Long-term liabilities Net assets Statement of Changes in Equity Equity at start of period Movement due to: Share capital and premium Retained earnings (2.5) Other Equity at end of period The financial profile represents significant investment directed into developing the platform propositions over several years now. Whilst no formal capital support from the parent company was required in 2012, 2013 or 2014, there were capital injections of 5m in 2015 and 79m in Historically, the losses (development expenditure) had been funded by a series of capital injections [ 54m, 40m, 25m, and 50m in years respectively]; running losses as at December 2016 year end reduced to 182m [2015: 192m]. AKG Financial Analytics Ltd April 2018

12 Standard Life Savings Ltd PLATFORM SECTOR Assets increased from 75.1m to 174.8m in 2016, boosted by retained profits of 10.2m and the capital injection of 79m, largely to fund the acquisition of Elevate. The main movements in the asset breakdown were 55.5m [2015: nil] relating to Elevate and an increase in the investment in Seabury Assets Fund plc (Ireland) from 40.6m to 92.0m. Liabilities increased from 8.2m to 18.7m, primarily due to a bank overdraft of 8.5m [2015: nil]. This resulted in total net assets (Shareholder's Funds) increasing to 156.1m [2015: 66.9m], Income Statement Revenue Other operating income Operating expenses (76.7) (64.0) (67.2) Operating profit (loss) (3.8) Other gains (losses) (0.3) Profit (loss) before taxation (4.1) Taxation Profit (loss) after taxation (2.5) Other comprehensive income Dividends Retained profit (loss) (2.5) Financial Ratios 2014 % 2015 % 2016 Operating margin (5) 8 13 Pre-tax profit margin (6) 8 13 Employee costs as a % of revenue Revenue from fee income increased by 11% from 69.1m to 77.0m in % With operating expenses increasing by 5% from 64.0m to 67.2m, operating profits rose by 89% to 9.8m. There is a significant underlying base of costs, the key components of which are staff costs and 'other administration costs'. All staff are employed by Standard Life Employee Services Ltd, and recharged to SLSL. There has been some volatility in the staff recharges over the past few years, with the average number of staff aligned to SLSL decreasing from 593 in 2011 to 349 in 2012, increasing back to 522 in 2013 and 564 in 2014, before reducing to 535 in 2015 and increasing to 548 in Staff costs also therefore increased to 38.1m [2015: 31.7m]. 'Other administration costs', a range of expenses including recharges and investment expenses, saw a further reduction to 27.6m [2015: 30.0m; 2014: 39.4m]. With revenue again exceeding expenses for the second consecutive year, after a number of years in which losses were recorded, SLSL reported a pre-tax profit in 2016 of 10.1m [2015: 5.3m]. No dividend was paid [2015: nil]. Standard Life Aberdeen plc's adjusted profit before tax, which excludes impacts arising from short-term fluctuations in investment return and economic assumption changes in the group s wholly owned insurance entities, reduced slightly from 1,054m to 1,039m on a pro forma basis in The group paid ordinary dividends totalling 469m in 2017 [2016: 370m]. AKG Financial Analytics Ltd April 2018

13 Standard Life Savings Ltd PLATFORM SECTOR Statement of Cash Flows Net cash generated from operating activities Net cash used in investing activities Net cash used in financing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at end of period (8.7) 5.5 (45.4) 5.0 (40.4) (51.1) (0.3) (4.0) (30.1) (17.5) (7.6) Assets under Administration (AuA) Assets at start of period 23, ,500.0 Inflows 4, ,369.0 Outflows 1, ,288.0 Net market and other movement Assets at end of period 23, , ,900.0 Growth rate (%) Net inflows as % of opening AuA Cash resources were negative 7.6m as at 31 December 2016 [2015: 9.8m, positive]. This included the bank overdraft of 8.5m [2015: nil], although there was also 92.0m [2015: 40.6m] invested in Seabury Assets Fund plc (Ireland), a liquidity fund managed by Aberdeen Standard Investments and shown elsewhere on the Balance Sheet. Net cash generated from operating activities was negative at 45.4m, reflecting the 55.5m purchase of Elevate. A revolving credit agreement of 30m with SLAL, which could be utilised for short term funding if required, expired in September The AuA figures above are at December year end and relate to the Standard Life platform proposition, including FundZone but excluding Elevate. The Elevate and Standard Life Wrap deal creates one of the UK's largest and fastest growing adviser platform businesses with combined AuA of over 44bn, supporting 3,000 adviser businesses, a total of 360,000 customers and combined new asset inflows of 4.8bn in AuA, including Standard Life Wrap, Elevate and FundZone, increased to 54.0bn as at 31 December 2017, with net inflows of 5.4bn in 2017 [2016: 4.2bn], helped by pension freedoms and DB to DC switches. As at 31 December 2017, Standard Life Aberdeen had assets under management and administration of 654.9bn [31 December 2016: 647.6bn], Aberdeen Standard Investments having 575.7bn under management, of which 179.6bn were third party assets [31 December 2016: 580.6bn and 181.3bn respectively]. 17 AKG Financial Analytics Ltd April 2018

14 INTRODUCTION Guide For over 20 years AKG has particularly focused on the financial strength requirements of financial advisers, who when acting on behalf of their clients, need to ascertain a company's ability to deliver sustained provision. From this customer perspective, the financial strength of companies needs to be focused at an operational level, specifically on the company that is effecting the product or service that a customer is selecting. This is important, because from the customer s perspective it is that company (not some higher corporate entity) that needs to survive in a form that maintains the requisite operational characteristics to meet their fairly held requirements. And it is thus at this level that the selection needs of the customers advisers must be met. It is also important to understand the sector approach (comparative peer groups) that is adopted in financial strength assessment and rating process. At AKG, this is again driven by the end customer perspective and the fact that assessment is designed solely for this purpose, i.e. as a component in helping customers advisers to select between comparable companies competing to deliver relevant products or services. AKG s focus and approach has remained consistent over the years since it commenced assessment and rating support for the market. However, coverage, format and presentation has rightly evolved over this period, in line with the needs and expectations of assessment and rating users in the market. And AKG considers further changes on a continual basis. Further details including an explanation of what is included in the assessment reports and coverage can be found online at AKG s process for assessment and rating is to use a balanced scorecard of measures and comparative information, relevant to the companies contained within each peer group. This is gathered via Public Information only for non-participatory assessments and public information plus company interactions with companies for participatory assessments. Further details on AKG s process can be found at This includes further information on the different participatory and non-participatory basis and for companies wishing to learn more about participatory assessment AKG is pleased to outline this and welcomes contact. This is a participatory assessment. RATING DEFINITIONS Overall Financial Strength Rating The objective is to provide a simple indication of the general financial strength of a company from the perspective of those financial advisers who when acting on behalf of their clients need to ascertain a company's ability to deliver sustained operational provision of products or services. The overall rating inherently reflects the mix of business within the company, since different types of customer or policyholder have different requirements and expectations, and the company may have particular strengths and weaknesses in respect of its key product or service areas. However, it also takes account of comparison across the sector in which it is assessed. The rating takes into account those of the following criteria which are relevant (depending upon the company's mix of business in-force): capital and asset position, expense position and profitability any specifically onerous element such as with profits realistic balance sheet position, structure (and size) of funds within the company, parental strength (and likely attitude towards supporting the company), operational capability, management strength and capability, strategic position AKG Financial Analytics Ltd April 2018

15 and rationale, brand and image, typical fund performance achievements or product / service features, its operating environment and ability to withstand external forces. Rating Scale A B+ B B- C D Superior Very Strong Strong Satisfactory Weak Very Weak Not applicable Service Rating The objective is to assess the quality of the organisation's service to the intermediary market in respect of the brand concerned. Criteria taken into account include: performance in surveys, awards and benchmarking exercises (external and internal), the organisation's philosophy, service charters, the extent of investments designed to improve service, and feedback from intermediaries. Rating Scale Excellent Very Good Good Adequate Poor Not Rated Image & Strategy Rating The objective is to assess the effectiveness of the means by which the organisation currently positions itself to distribute its products for the brand concerned and the plans it has to maintain and/or develop its position. Criteria taken into account include: overall trends in the company s market share position, brand visibility and reputation, feedback from intermediaries and industry commentators, and AKG s view of the company s general strategy. Rating Scale Excellent Very Good Good Adequate Poor Not Rated Business Performance Rating This review is an assessment of how the company and the brand has fared against its peers, and how it is perceived externally. Effectively this is how it has performed recently in the market. Whilst it will include performance indicators from the most recent available statutory reporting (report and accounts and SFCRs in the case of insurance companies, for example) it will also draw on other recent key performance elements before and after such disclosure, up to the point at which the assessment is undertaken. Criteria taken into account include: increase/decrease in market shares, expense containment, publicity good or bad, press or market commentary, regulatory fines, and competitive position. Rating Scale Excellent Very Good Good Adequate Poor Not Rated AKG Financial Analytics Ltd April 2018

16 ABOUT AKG AKG is an independent organisation. Originally established as an actuarial consultancy AKG has, for over 20 years, specialised in the provision of assessment, ratings, information and market assistance to the financial services industry. As the market has evolved over this period, the range of entities considered by AKG has expanded. Consequently, AKG has brought additional skill sets into its operations. This has meant the inclusion of accounting, corporate finance, IT and market intelligence experience, alongside actuarial resources, to deliver an expanded professional capability. Today AKG s core purpose is in the provision of financial analysis and review services to support the wider financial services sector and its customers. AKG Financial Analytics Ltd (AKG) 2018 This report is issued as at a certain date, and it remains AKG's current assessment with current ratings until it is superseded by a subsequently issued report or subsequently issued ratings (at which point the newly issued report or ratings should be used), or until AKG ceases to make such a report or ratings available. The report contains assessment based on available information at the date as shown on the report s cover and in its page footer. This includes prior regulatory data which may have an earlier date associated with it, but the report also takes into account all relevant events and information, available to and considered by AKG, which have occurred prior to this stated cover and footer date. Events and information subsequent to this date are not covered within it, but AKG continually monitors and reviews such events and information and where individually or in aggregate such events or information give rise to rating revision an updated report under an updated date is issued as soon as possible. All rights reserved. This report is protected by copyright. This report and the data/information contained herein is provided on a single site multi user basis. It may therefore be utilised by a number of individuals within a location. If provided in paper form this may be as part of a physical library arrangement, but copying is prohibited under copyright. If provided in electronic form, this may be by means of a shared server environment, but copying or installation onto more than one computer is prohibited under copyright. Printing from electronic form is permitted for own (single location) use only and multiple printing for onward distribution is prohibited under copyright. Further distribution and uses of the report, either in its entirety or part thereof, may be permitted by separate agreement, under licence. Please contact AKG in this regard or with any questions: Tel +44 (0) AKG has made every effort to ensure the accuracy of the content of this report and to ensure that the information contained is as current as possible at the date of issue, but AKG (inclusive of its directors, officers, staff and shareholders and any affiliated third parties) cannot accept any liability to any party in respect of, or resulting from, errors or omissions. AKG information, comments and opinion, as expressed in the form of its analysis and ratings, do not establish or seek to establish suitability in any individual regard and AKG does not provide, explicitly or implicitly, through this report and its content, or any other assessment, rating or commentary, any form of investment advice or fiduciary service. AKG Financial Analytics Ltd April 2018

17 AKG Financial Analytics Ltd Anderton House, 92 South Street, Dorking, Surrey RH4 2EW Tel: +44 (0) Web: AKG Financial Analytics Ltd 2018