Global - Overview. Copyright Structured Retail Products a division of Euromoney Global Limited 2018

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2 Global - Overview

3 Overview of the Global Market

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5 Structured Product Market is growing +13% 2.5 Global Outstanding Volume in USDbn End of 213 End of 214 End of 215 End of 216 End of 217 End of August 218*

6 Sales volume by Region - in USDm 7, 6, 5, 4, 3, 2, 1, e North America: 25% Latin America: 22% Europe: 9% International: 8% Asia Pacific: 1% MEA: -1% Europe MEA North America Latin America Asia Pacific International

7 All these factors aligned perfectly Global Average Annual Performance US Treasury Yield Curve Rates 6.% 5.% 4.% 3.% 2.% 1.%.% 2.5% 2.% ytd S&P5 dividends % mo 3 mo 6 mo 1 yr 2 yr 3 yr 5 yr 7 yr 1 yr 2 yr 3 yr Sep-18 Sep-17 CBOE Volatility Index (VIX) 1.5% %.5%.% 218-Sep and Yahoo Finance

8 From whom can we learn?

9 Structured Product Market is growing +13%

10 16, 14, 12, 1, 8, 6, 4, 2, In South Korea, yield is everything Outstanding Volume (USDm) Sales Volume (USDm) 12, 1, 8, 6, 4, 2, ytd e Market share by Payoffs, 218ytd Credit Default, 7% Others, 41% Autocallables, 52% 8, 6, 4, 2, Correlation between average autocall coupon and sales is.13 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Monthly Sales (KRWbn) - LHS Average Autocallable Coupon - RHS 3.% 2.% 1.%.%

11 Structured Product Market is growing +13%

12 Taiwan: If you are looking for long-term high-interest-rate markets Outstanding Volume (USDm) 4, 3, 2, 1, 2, 15, ytd Sales Volume (USDm) 2,5 2, 1,5 1, 5 Outstanding Volume in ZAR Products (USDm) , 5, e Outstanding Volume (USDm) ZARTWD

13 Structured Product Market is growing +13%

14 Sales Volume should finish 2% up mainly due to the performances Outstanding Volume (USDm) Sales Volume (USDm) 8, 25, 6, 2, 4, 2, 15, 1, 5, ytd e Strategy and Prop Indices Market Share Strategy Proprietary & Custom Indexes

15 Structured Product Market is growing +13%

16 US investors looking for yield with Reverse Convertibles on US stocks on Notes Outstanding Volume (USDm) Sales Volume (USDm) 4, 39, 38, 37, 36, 35, 34, ytd 8, 7, 6, 5, 4, 3, 2, 1, e 35.% 3.% 25.% 2.% 15.% 1.% 5.%.% Market Share of Autocallables in the USA ytd 8% 6% 4% 2% US Investors use structured products to sell volatility % ytd Autocallable Reverse Convertibles

17 US Market-linked CD s

18 Market-linked CD s are the closer market to the Indexed Insurance products 35, 3, 25, 2, 15, 1, 5, Outstanding Volume in MLCD's (USDm) Fixed Upside 4% Enhanced Tracker, Knock Out 4% Digital 7% Uncapped Call 14% Market share by payoffs Capped Call 4% Knock Out 21% Enhanced Tracker 44% 6% 5% 4% 3% 2% 1% % Market share of Proprietary Indices in MLCDs (%) 3.% 25.% 2.% 15.% 1.% 5.%.% Histogram of participation on MLCD's in 218 1% 1-12%12-14%14-16%16-18%18-2% >2%

19 Market-linked CD s are the closer market to the Indexed Insurance products 4 Participation rate vs. term

20 US Indexed Insurance Market

21 Recent Additions : BlackRock ibld Ascenda Index launched in September 218; GS Motif Aging of America Dynamic Balance Index launched in August 218; BlackRock ibld Claria Index designed specifically for annuities in February 218; Balanced Capital Strength 6 Index developed in May 218; Franklin US Index - launched in November 217; PIMCO Global Optima Index - launched in October 217; Janus SG Market Consensus Index - launched in May 217; BNP Paribas Momentum Multi-Asset 5 Index - launched in January 217;

22 Number of underlyings per sector as % of all unique underlyings being offered in indexed annuities Total interest crediting strategies for all underlyings within each sector as % of all strategies

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26 Global Trends

27 Equity Indices are replacing FX rates and other underlyings 6.% Global Market Share of Equity Indices 5.% 4.5% Strategy & Proprietary Indices 218 vs % 4.% 3.% 2.% 4.% 3.5% 3.% 2.5% 2.% 1.5% Country & Regional Indices +2% Proprietary Indices +153% Strategy Indices +3% 1.% 1.%.5%.% ytd.%

28 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % Global TOP 1 Underlyings ytd Key Trends on underlyings Growing: 218 vs. 217 Eurostoxx 5, Hang Seng China Enterprises Index, S&P % Eurostoxx 5, Hang Seng China Enterprises Index, Nikkei % Eurostoxx 5, Hang Seng China Enterprises Index, Kospi 2 +93% Others 55.98% 66.46% 59.51% 59.98% Certificate of Deposit Rate 91d.54% 1.17%.88% 1.15% Gold 2.9% 3.37% 1.1% 1.24% USD/MXN.1%.2%.97% 1.38% Eurostoxx 5, Kospi 2, S&P 5.54% 1.34% 1.61% 1.88% Eurostoxx 5, Hang Seng China Enterprises Index, Kospi 2.8%.27%.98% 1.88% Unknown.92% 2.2% 2.6% 2.26% Eurostoxx 5, Hang Seng China Enterprises Index, Nikkei 225.%.8%.44% 2.3% Kospi % 2.23% 2.49% 2.38% FX Rate (Unspecified) 24.83% 1.3% 2.1% 2.53% S&P % 3.93% 2.61% 3.2% Falling: USD 3M Libor -75% Kospi 2-4% USD 3M Libor.1%.12% 16.36% 4.13% Share Basket (Unspecified) 2.45% 2.54% 1.81% 4.3% Eurostoxx 5, Hang Seng China Enterprises Index, S&P %.22%.57% 4.76% Eurostoxx 5 5.4% 5.75% 6.6% 6.82%

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30 Survey Results Source: SRP s 218 Indexed Insurance survey

31 Key trends and challenges Regulatory changes Consumer education ensuring Americans are educated about the need for lifetime income and really understand how the products work Innovation Hybrid products Smart beta indices Higher market volatility Fighting stock market performance Income benefits with lower cost Shorter surrender periods Set fees for life & flexibility to cancel Trying to determine by what and when the Credit cycle and interest rates industry will be disrupted Source: SRP s 218 Indexed Insurance survey

32 What should we take from this conference? 1) Trends Navigating a Mature Bull Market Adviser Panel: Best Practices for Using Structured Products and Indexed Insurance Global Market Overview: Insurance & Structured Products Recap 2) Innovation & Product Ideas Product Development and Innovation in Annuities Index Innovation in Capital Markets In Conversation with leading Carriers 3) Distribution & Education Insurance Solutions Distribution Best Practices from each Channel Is the Future of Advice Technologically Driven? Growing the Pot: How can Index Annuities become Mainstream Products?

33 Thank you for your attention! Tiago Fernandes Managing Director Anita Kirilova Research Analyst Copyright 218 Structured Retail Products Limited. All Rights Reserved. Reproduction and distribution of this report in any form without prior written permission is strictly prohibited. The information contained herein has been obtained from sources believed to be reliable. SRP disclaims all warranties as to the accuracy, completeness or adequacy of such information. Use of this report is at your sole risk and SRP accept no responsibility for any problems or incidents arising from its use.