1

Investor Day 12.04.07

Prudential Financial, Inc.

Investor Day

December 4, 2007

Prudential Financial, Inc.

Investor Day

December 4, 2007

Exhibit 99.2

2

Investor Day 12.04.07

Forward-Looking Statements

Certain

of

the

statements

included

in

this

presentation

constitute

forward-looking

statements

within

the

meaning

of

the

U.S.

Private

Securities

Litigation

Reform

Act

of

1995.

It

is

possible

that

actual

results

may

differ

materially

from

any

expectations

or

predictions

expressed

in

this

presentation.

Words

such

as

“expects,”

“believes,”

“anticipates,”

“includes,”

“plans,”

“assumes,”

“estimates,”

“projects,”

“intends,”

“should,”

“will,”

“shall,”

or

variations

of

such

words

are

generally

part

of

forward-looking

statements.

Forward-looking

statements

are

made

based

on

management’s

current

expectations

and

beliefs

concerning

future

developments

and

their

potential

effects

upon

Prudential

Financial,

Inc.

and

its

subsidiaries.

There

can

be

no

assurance

that

future

developments

affecting

Prudential

Financial,

Inc.

and

its

subsidiaries

will

be

those

anticipated

by

management.

These

forward-looking

statements

are

not

a

guarantee

of

future

performance

and

involve

risks

and

uncertainties,

and

there

are

certain

important

factors

that

could

cause

actual

results

to

differ,

possibly

materially,

from

expectations

or

estimates

reflected

in

such

forward-looking

statements,

including,

among

others:

(1)

general

economic,

market

and

political

conditions,

including

the

performance

and

fluctuations

of

stock,

real

estate,

and

other

financial

markets;

(2)

interest

rate

fluctuations;

(3)

reestimates

of

our

reserves

for

future

policy

benefits

and

claims;

(4)

differences

between

actual

experience

regarding

mortality,

morbidity,

persistency,

surrender

experience,

interest

rates

or

market

returns

and

the

assumptions

we

use

in

pricing

our

products,

establishing

liabilities

and

reserves

or

for

other

purposes;

(5)

changes

in

our

assumptions

related

to

deferred

policy

acquisition

costs,

valuation

of

business

acquired

or

goodwill;

(6)

changes

in

our

claims-paying

or

credit

ratings;

(7)

investment

losses

and

defaults;

(8)

competition

in

our

product

lines

and

for

personnel;

(9)

changes

in

tax

law;

(10)

economic,

political,

currency

and

other

risks

relating

to

our

international

operations;

(11)

fluctuations

in

foreign

currency

exchange

rates

and

foreign

securities

markets;

(12)

regulatory

or

legislative

changes;

(13)

adverse

determinations

in

litigation

or

regulatory

matters

and

our

exposure

to

contingent

liabilities,

including

in

connection

with

our

divestiture

or

winding

down

of

businesses;

(14)

domestic

or

international

military

actions,

natural

or

man-made

disasters

including

terrorist

activities

or

pandemic

disease,

or

other

events

resulting

in

catastrophic

loss

of

life;

(15)

ineffectiveness

of

risk

management

policies

and

procedures

in

identifying,

monitoring

and

managing

risks;

(16)

effects

of

acquisitions,

divestitures

and

restructurings,

including

possible

difficulties

in

integrating

and

realizing

the

projected

results

of

acquisitions;

(17)

changes

in

statutory

or

U.S.

GAAP

accounting

principles,

practices

or

policies;

(18)

changes

in

assumptions

for

retirement

expense;

(19)

Prudential

Financial,

Inc.’s

primary

reliance,

as

a

holding

company,

on

dividends

or

distributions

from

its

subsidiaries

to

meet

debt

payment

obligations

and

continue

share

repurchases,

and

the

applicable

regulatory

restrictions

on

the

ability

of

the

subsidiaries

to

pay

such

dividends

or

distributions;

and

(20)

risks

due

to

the

lack

of

legal

separation

between

our

Financial

Services

Businesses

and

our

Closed

Block

Business.

Prudential

Financial,

Inc.

does

not

intend,

and

is

under

no

obligation,

to

update

any

particular

forward-looking

statement

included

in

this

presentation.

_______________________________________________________________________________

Prudential

Financial,

Inc.

of

the

United

States

is

not

affiliated

with

Prudential

PLC

which

is

headquartered

in

the

United

Kingdom.

3

Investor Day 12.04.07

Non–GAAP Measure

Adjusted

operating

income

is

a

non-GAAP

measure

of

performance

of

our

Financial

Services

Businesses.

Adjusted

operating

income

excludes

"Realized

investment

gains

(losses),

net,"

as

adjusted,

and

related

charges

and

adjustments.

A

significant

element

of

realized

investment

gains

and

losses

are

impairments

and

credit-related

and

interest

rate-related

gains

and

losses.

Impairments

and

losses

from

sales

of

credit-impaired

securities,

the

timing

of

which

depends

largely

on

market

credit

cycles,

can

vary

considerably

across

periods.

The

timing

of

other

sales

that

would

result

in

gains

or

losses,

such

as

interest

rate-related

gains

or

losses,

is

largely

subject

to

our

discretion

and

influenced

by

market

opportunities

as

well

as

our

tax

profile.

Realized

investment

gains

(losses)

representing

profit

or

loss

of

certain

of

our

businesses

which

primarily

originate

investments

for

sale

or

syndication

to

unrelated

investors,

and

those

associated

with

terminating

hedges

of

foreign

currency

earnings

and

current

period

yield

adjustments

are

included

in

adjusted

operating

income.

Realized

investment

gains

and

losses

from

products

that

are

free

standing

derivatives

or

contain

embedded

derivatives,

and

from

associated

derivative

portfolios

that

are

part

of

an

economic

hedging

program

related

to

the

risk

of

those

products,

are

included

in

adjusted

operating

income.

Adjusted

operating

income

also

excludes

investment

gains

and

losses

on

trading

account

assets

supporting

insurance

liabilities

and

changes

in

experience-rated

contractholder

liabilities

due

to

asset

value

changes,

because

these

recorded

changes

in

asset

and

liability

values

will

ultimately

accrue

to

contractholders.

Trends

in

the

underlying

profitability

of

our

businesses

can

be

more

clearly

identified

without

the

fluctuating

effects

of

these

transactions.

In

addition,

adjusted

operating

income

excludes

the

results

of

divested

businesses,

which

are

not

relevant

to

our

ongoing

operations.

Discontinued

operations,

which

is

presented

as

a

separate

component

of

net

income

under

GAAP,

is

also

excluded

from

adjusted

operating

income.

We

believe

that

the

presentation

of

adjusted

operating

income

as

we

measure

it

for

management

purposes

enhances

understanding

of

the

results

of

operations

of

the

Financial

Services

Businesses

by

highlighting

the

results

from

ongoing

operations

and

the

underlying

profitability

of

our

businesses.

However,

adjusted

operating

income

is

not

a

substitute

for

income

determined

in

accordance

with

GAAP,

and

the

excluded

items

are

important

to

an

understanding

of

our

overall

results

of

operations.

The

schedules

on

the

following

three

pages

provide

a

reconciliation

of

adjusted

operating

income

for

the

Financial

Services

Businesses

to

income

from

continuing

operations

in

accordance

with

GAAP.

Return

on

equity

(“ROE”)

based

on

adjusted

operating

income

is

determined

by

dividing

adjusted

operating

income

after-tax

(giving

effect

to

the

direct

equity

adjustment

for

earnings

per

share

calculation),

annualized

for

interim

periods,

by

average

attributed

equity

for

the

Financial

Services

Businesses

excluding

accumulated

other

comprehensive

income

related

to

unrealized

gains

and

losses

on

investments

for

all

periods

and

accumulated

other

comprehensive

income

related

to

pension

and

postretirement

benefits

for

periods

including

and

after

2004.

An

alternative

measure

to

ROE

based

on

adjusted

operating

income

is

return

on

average

equity

based

on

income

from

continuing

operations.

Return

on

average

equity

based

on

income

from

continuing

operations

represents

income

from

continuing

operations

after-tax

as

determined

in

accordance

with

GAAP

(giving

effect

to

the

direct

equity

adjustment

for

earnings

per

share

calculation),

annualized

for

interim

periods,

divided

by

average

total

attributed

equity

for

the

Financial

Services

Businesses.

Return

on

average

equity

based

on

income

from

continuing

operations

is

16.82%

and

14.04%

for

the

nine

months

ended

September

30,

2007

and

2006,

respectively,

and

14.67%,

15.48%,

9.23%,

5.38%

and

3.79%

for

the

years

ended

December

31,

2006,

2005,

2004,

2003

and

2002,

respectively.

Our

expectations

of

Common

Stock

earnings

per

share

and

return

on

equity

are

based

on

after-tax

adjusted

operating

income.

Because

we

do

not

predict

future

realized

investment

gains

/

losses

or

recorded

changes

in

asset

and

liability

values

that

will

ultimately

accrue

to

contractholders,

we

cannot

provide

a

measure

of

our

Common

Stock

earnings

per

share

or

return

on

equity

expectations

based

on

income

from

continuing

operations

of

the

Financial

Services

Businesses,

which

is

the

GAAP

measure

most

comparable

to

adjusted

operating

income.

For

additional

information

about

adjusted

operating

income

and

the

comparable

GAAP

measure

please

refer

to

our

Annual

Report

on

Form

10-K

for

the

year

ended

December

31,

2006,

our

Quarterly

Report

on

Form

10-Q

for

the

quarter

ended

September

30,

2007

and

our

Current

Report

on

Form

8-K

dated

October

4,

2007

on

the

Investor

Relations

Web

site

at

www.investor.prudential.com.

Additional

historical

information

relating

to

the

Company’s

financial

performance,

including

its

third

quarter

2007

Quarterly

Financial

Supplement,

is

also

located

on

the

Investor

Relations

website.

The

information

referred

to

above

and

on

the

prior

page,

as

well

as

the

risks

of

our

businesses

described

in

our

Annual

Report

on

Form

10-K

for

the

year

ended

December

31,

2006,

and

our

Quarterly

Report

on

Form

10-Q

for

the

quarter

ended

September

30,

2007,

should

be

considered

by

readers

when

reviewing

forward-looking

statements

contained

in

this

presentation.

4

Investor Day 12.04.07

Reconciliation between adjusted operating income

and the comparable GAAP measure

Reconciliation between adjusted operating income

and the comparable GAAP measure

Prudential Financial, Inc.

(in millions, except per share data)

2002

2003

2004

2005

2006

Financial Services Businesses:

Pre-tax adjusted operating income by division:

Insurance Division

545

$      

788

$      

991

$      

1,227

$   

1,359

$   

Investment Division

238

287

351

707

1,129

International Insurance and Investments Division

757

803

994

1,416

1,566

Corporate and other operations

133

75

161

188

47

Total pre-tax adjusted operating income

1,673

1,953

2,497

3,538

4,101

Income taxes, applicable to adjusted operating income

559

638

673

1,115

1,174

Financial Services Businesses after-tax adjusted operating income

1,114

1,315

1,824

2,423

2,927

Reconciling items:

Realized investment gains (losses), net, and related charges and adjustments

(856)

(204)

4

561

90

Investment gains (losses) on trading account assets supporting insurance liabilities, net

-

-

(55)

(33)

35

Change in experience-rated contractholder

liabilities due to asset value changes

-

-

1

(44)

11

Sales practices remedies and costs

(20)

-

-

-

-

Divested businesses

(10)

(171)

(24)

(16)

76

Equity in earnings of operating joint ventures

(7)

(71)

(72)

(214)

(322)

Total reconciling items, before income taxes

(893)

(446)

(146)

254

(110)

Income taxes, not applicable to adjusted operating income

(497)

(148)

(75)

(473)

(48)

Total reconciling items, after income taxes

(396)

(298)

(71)

727

(62)

Income from continuing operations (after-tax) of Financial Services Businesses

before equity in earnings of operating joint ventures, extraordinary gain on acquisition

and cumulative effect of accounting change

718

1,017

1,753

3,150

2,865

Equity in earnings of operating joint ventures, net of taxes

5

45

55

142

208

Income from continuing operations (after-tax) of Financial Services Businesses

before extraordinary gain on acquisition and cumulative effect of accounting change

723

1,062

1,808

3,292

3,073

Income (loss) from discontinued operations, net of taxes

(44)

(37)

(76)

(73)

71

Extraordinary gain on acquisition, net of taxes

-

-

21

-

-

Cumulative effect of accounting change, net of taxes

-

-

(79)

-

-

Net income of Financial Services Businesses

679

$      

1,025

$   

1,674

$   

3,219

$   

3,144

$   

Earnings per share of Common Stock (diluted):

Financial Services Businesses after-tax adjusted operating income

2.00

$     

2.51

$     

3.59

$     

4.81

$     

6.06

$     

Reconciling items:

Realized investment gains (losses), net, and related charges and adjustments

(1.48)

(0.37)

0.01

1.08

0.18

Investment gains (losses) on trading account assets supporting insurance liabilities, net

-

-

(0.10)

(0.06)

0.07

Change in experience-rated contractholder

liabilities due to asset value changes

-

-

-

(0.08)

0.02

Sales practices remedies and costs

(0.03)

-

-

-

-

Divested businesses

(0.02)

(0.31)

(0.05)

(0.03)

0.15

Equity in earnings of operating joint ventures

(0.01)

(0.13)

(0.13)

(0.42)

(0.64)

Total reconciling items, before income taxes

(1.54)

(0.81)

(0.27)

0.49

(0.22)

Income taxes, not applicable to adjusted operating income

(0.86)

(0.26)

(0.14)

(0.91)

(0.10)

Total reconciling items, after income taxes

(0.68)

(0.55)

(0.13)

1.40

(0.12)

Income from continuing operations (after-tax) of Financial Services Businesses

before equity in earnings of operating joint ventures, extraordinary gain on acquisition

and cumulative effect of accounting change

1.32

1.96

3.46

6.21

5.94

Equity in earnings of operating joint ventures, net of taxes

0.01

0.09

0.10

0.27

0.42

Income from continuing operations (after-tax) of Financial Services Businesses

before extraordinary gain on acquisition and cumulative effect of accounting change

1.33

2.05

3.56

6.48

6.36

Income (loss) from discontinued operations, net of taxes

(0.08)

(0.07)

(0.14)

(0.14)

0.14

Extraordinary gain on acquisition, net of taxes

-

-

0.04

-

-

Cumulative effect of accounting change, net of taxes

-

-

(0.15)

-

-

Net income of Financial Services Businesses

1.25

$     

1.98

$     

3.31

$     

6.34

$     

6.50

$     

Weighted average number of outstanding Common shares (diluted basis)

578.0

548.4

531.2

520.9

494.0

Reconciliation to Consolidated Net Income of Prudential Financial, Inc:

Net income of Financial Services Businesses (above)

679

$      

1,025

$   

1,674

$   

3,219

$   

3,144

$   

Net income (loss) of Closed Block Business

(485)

239

582

321

284

Consolidated net income

194

$      

1,264

$   

2,256

$   

3,540

$   

3,428

$   

Direct equity adjustments for earnings per share calculations

43

$        

60

$        

84

$        

82

$        

68

$        

Year ended December 31,

5

Investor Day 12.04.07

Reconciliation between adjusted operating income

and the comparable GAAP measure (continued)

Reconciliation between adjusted operating income

and the comparable GAAP measure (continued)

Prudential Financial, Inc.

(in millions, except per share data)

Sept 30, 2006

Sept 30, 2007

Financial Services Businesses:

Pre-tax adjusted operating income by division:

Insurance Division

1,010

$        

1,255

$        

Investment Division

768

1,086

International Insurance and Investments Division

1,168

1,410

Corporate and other operations

60

(4)

Total pre-tax adjusted operating income

3,006

3,747

Income taxes, applicable to adjusted operating income

861

1,104

Financial Services Businesses after-tax adjusted operating income

2,145

2,643

Reconciling items:

Realized investment gains (losses), net, and related charges and adjustments

(40)

63

Investment gains (losses) on trading account assets supporting insurance liabilities, net

(8)

10

Change in experience-rated contractholder

liabilities due to asset value changes

28

4

Sales practices remedies and costs

-

-

Divested businesses

58

29

Equity in earnings of operating joint ventures

(223)

(323)

Total reconciling items, before income taxes

(185)

(217)

Income taxes, not applicable to adjusted operating income

(91)

(90)

Total reconciling items, after income taxes

(94)

(127)

Income from continuing operations (after-tax) of Financial Services Businesses

before equity in earnings of operating joint ventures, extraordinary gain on acquisition

and cumulative effect of accounting change

2,051

2,516

Equity in earnings of operating joint ventures, net of taxes

146

200

Income from continuing operations (after-tax) of Financial Services Businesses

before extraordinary gain on acquisition and cumulative effect of accounting change

2,197

2,716

Income (loss) from discontinued operations, net of taxes

54

4

Extraordinary gain on acquisition, net of taxes

-

-

Cumulative effect of accounting change, net of taxes

-

-

Net income of Financial Services Businesses

2,251

$        

2,720

$        

Earnings per share of Common Stock (diluted):

Financial Services Businesses after-tax adjusted operating income

4.41

$          

5.69

$          

Reconciling items:

Realized investment gains (losses), net, and related charges and adjustments

(0.08)

0.13

Investment gains (losses) on trading account assets supporting insurance liabilities, net

(0.02)

0.02

Change in experience-rated contractholder

liabilities due to asset value changes

0.06

0.01

Sales practices remedies and costs

-

-

Divested businesses

0.12

0.06

Equity in earnings of operating joint ventures

(0.45)

(0.68)

Total reconciling items, before income taxes

(0.37)

(0.46)

Income taxes, not applicable to adjusted operating income

(0.18)

(0.19)

Total reconciling items, after income taxes

(0.19)

(0.27)

Income from continuing operations (after-tax) of Financial Services Businesses

before equity in earnings of operating joint ventures, extraordinary gain on acquisition

and cumulative effect of accounting change

4.22

5.42

Equity in earnings of operating joint ventures, net of taxes

0.29

0.43

Income from continuing operations (after-tax) of Financial Services Businesses

before extraordinary gain on acquisition and cumulative effect of accounting change

4.51

5.85

Income (loss) from discontinued operations, net of taxes

0.11

0.01

Extraordinary gain on acquisition, net of taxes

-

-

Cumulative effect of accounting change, net of taxes

-

-

Net income of Financial Services Businesses

4.62

$          

5.86

$          

Weighted average number of outstanding Common shares (diluted basis)

497.8

471.6

Reconciliation to Consolidated Net Income of Prudential Financial, Inc:

Net income of Financial Services Businesses (above)

2,251

$        

2,720

$        

Net income (loss) of Closed Block Business

140

113

Consolidated net income

2,391

$        

2,833

$        

Direct equity adjustments for earnings per share calculations

51

$             

42

$             

Nine months ended

6

Investor Day 12.04.07

Prudential Financial, Inc.

COMBINED STATEMENTS OF OPERATIONS - FINANCIAL SERVICES BUSINESSES

(in millions)

2002

2003

2004

2005

2006

Sept 30, 2006

Sept 30, 2007

Revenues (1):

  Premiums

7,195

$    

7,848

$    

8,736

$    

10,128

$  

10,287

$  

7,694

$          

8,077

$          

  Policy charges and fee income

1,815

      

1,978

      

2,385

      

2,529

      

2,649

      

1,912

            

2,294

            

  Net investment income

5,017

      

4,913

      

5,771

      

6,861

      

7,657

      

5,647

            

6,240

            

  Asset management fees, commissions and other income

3,618

      

2,971

      

2,783

      

3,358

      

3,969

      

2,831

            

3,406

            

     Total revenues

17,645

    

17,710

    

19,675

    

22,876

    

24,562

    

18,084

          

20,017

          

Benefits and Expenses (1):

  Insurance and annuity benefits

7,662

      

8,158

      

8,897

      

9,990

      

10,423

    

7,818

            

8,104

            

  Interest credited to policyholders' account balances

1,730

      

1,718

      

2,220

      

2,516

      

2,790

      

2,045

            

2,286

            

  Interest expense

195

         

200

         

334

         

615

         

949

         

694

                

831

                

  Deferral of acquisition costs

(1,064)

     

(1,270)

     

(1,528)

     

(1,801)

     

(2,037)

     

(1,492)

           

(1,649)

           

  Amortization of acquisition costs

739

         

533

         

766

         

910

         

670

         

431

                

643

                

  General and administrative expenses

6,710

      

6,418

      

6,489

      

7,108

      

7,666

      

5,582

            

6,055

            

    Total benefits and expenses

15,972

    

15,757

    

17,178

    

19,338

    

20,461

    

15,078

          

16,270

          

Adjusted operating income before income taxes

1,673

      

1,953

      

2,497

      

3,538

      

4,101

      

3,006

            

3,747

            

Reconciling items:

    Realized investment gains (losses), net, and related adjustments

(862)

        

(161)

        

62

           

669

         

73

           

(70)

                 

80

                  

    Related charges

6

             

(43)

          

(58)

          

(108)

        

17

           

30

                  

(17)

                 

    Total realized investment gains (losses), net, and related charges and adjustments

(856)

        

(204)

        

4

             

561

         

90

           

(40)

                 

63

                  

   Investment gains (losses) on trading account assets supporting insurance liabilities, net

-

          

-

          

(55)

          

(33)

          

35

           

(8)

                   

10

                  

   Change in experience-rated contractholder liabilities due to asset value changes

-

          

-

          

1

             

(44)

          

11

           

28

                  

4

                    

   Sales practices remedies and costs

(20)

          

-

          

-

          

-

          

-

          

-

                 

-

                 

   Divested businesses

(10)

          

(171)

        

(24)

          

(16)

          

76

           

58

                  

29

                  

   Equity in earnings of operating joint ventures

(7)

            

(71)

          

(72)

          

(214)

        

(322)

        

(223)

              

(323)

              

      Total reconciling items, before income taxes

(893)

        

(446)

        

(146)

        

254

         

(110)

        

(185)

              

(217)

              

Income from continuing operations before income taxes, equity in earnings of operating

   joint ventures, extraordinary gain on acquisition and cumulative effect of accounting change

780

         

1,507

      

2,351

      

3,792

      

3,991

      

2,821

            

3,530

            

Income tax expense

62

           

490

         

598

         

642

         

1,126

      

770

                

1,014

            

Income from continuing operations before equity in earnings of operating joint ventures,

  extraordinary gain on acquisition and cumulative effect of accounting change

718

$       

1,017

$    

1,753

$    

3,150

$    

2,865

$    

2,051

$          

2,516

$          

(1) Revenues exclude realized investment gains, net of losses and related charges and adjustments; investment gains, net of losses, on trading account assets supporting insurance

liabilities, and revenues of divested businesses, and include revenues representing equity in earnings of operating joint ventures.  Benefits and expenses exclude charges related to

realized investment gains, net of losses; change in experience-rated contractholder liabilities due to asset value changes, benefits and expenses of divested businesses, and

sales practices remedies and costs.

Year ended December 31,

Nine months ended

Reconciliation between adjusted operating income

and the comparable GAAP measure (continued)

Reconciliation between adjusted operating income

and the comparable GAAP measure (continued)

7

Investor Day 12.04.07

FSB Full Year 2008

Earnings Guidance

2007 Guidance

(1)

$7.45 -

$7.60

Non-Recurring/

Unsustainable

2007 Items

Baseline

Earnings Level

$7.15 -

$7.30

Capital

management:

share repurchases,

increased leverage

1)

Based on after-tax adjusted operating income for the Financial Services Businesses

Growth/

Expense

Management

2008 Guidance

(1)

Baseline

Baseline

Earnings

Earnings

Growth

Growth

Non-Recurring

2008 Items

Wachovia Securities

one-time costs

$8.00 -

$8.20

$8.20

-

$8.40

8

Prudential Financial, Inc.

Prudential Financial, Inc.

Art Ryan

CEO and Chairman

Art Ryan

CEO and Chairman

9

Investor Day 12.04.07

25

17

21

16

9

11

11

11

27

29

16

19

43

18

27

Equity Capital Migration      Businesses with

Favorable Growth and Return Prospects

1)

Attributed equity of FSB; excluding accumulated other comprehensive income related to unrealized gains

and losses on investments for all years and accumulated other comprehensive income related to pension

and postretirement benefits for September 30, 2007 and December 31, 2004

2)

Includes divested businesses

$18.4

Billion

(1)

12/31/04

9/30/07

12/31/02

$19.7

Billion

(1)

$22.2

Billion

(1)

International

Division

Retirement &

Annuities

Domestic

Investment

Businesses

Domestic

Insurance

Corporate &

Other

(2)

10

Investor Day 12.04.07

2008 and Beyond …

•

Two substantial growth opportunities:

–

International businesses

–

Domestic retirement and savings businesses

•

Evolving multi-channel distribution strategy

•

Manage margins and returns

•

Substantial operating cash flows enable share

repurchases, growing cash dividends

•

Opportunistic acquisitions

11

Investor Day 12.04.07

2008 –

2010 Objectives: Continued ROE Growth;

Drive to “Optimal Capital Structure”

83%

83%

17%

17%

$25.7 billion

73%

73%

27%

27%

$32 billion

8.2%

7.8%

Weighted Average

Cost of Capital

14.3%

16% -

18%

2006

TARGET 2008 -

2010

Debt 

Equity                   Debt and Hybrid Securities

12

Investor Day 12.04.07

2008 –

2010 Financial Objectives

•

ROE expansion to 16% –

18% range

(1)

•

Solid double digit average annual growth in EPS

(1)

•

Reasonably consistent operating results

•

Stock buybacks of $3.5 billion a year through 2010

under base case

•

“AA”

capital management

1)

Based on after-tax adjusted operating income of the FSB. ROE targets based on attributed equity

excluding accumulated other comprehensive income related to unrealized gains and losses on

investments and pension and postretirement benefits.