Photo of Nandini Mongia, Prudential Financial.

Diverse, inclusive and talented treasury team is key to Prudential’s success

Treasury team drives transformation efforts

Prudential’s treasury team drove significant outcomes in 2021 against the backdrop of the enterprise’s transformation efforts of becoming a higher growth, less market sensitive and more nimble company. The team managed Prudential’s capital position, shareholder distributions and debt reduction to accomplish its strategic objectives while satisfying the enterprise’s capital and risk objectives. The team also launched several innovative initiatives to support the company’s growth agenda.

Team delivers key projects and benefits

In 2021, the treasury team has delivered the following:

• Established frameworks and methodologies used to manage the enterprise and improved outcomes. The team’s capital allocation framework enabled top-down strategic decision-making on allocating scarce resources by raising the visibility of gross cash flow generation and capital invested for growth and framing of the business portfolio. Additionally, the team implemented a new framework for product cost of capital in conjunction with the value of a new business to drive attractive growth.
• Provided thought leadership around strategic implications of emerging regulatory frameworks related to domestic and international capital standards. By advocating for correcting technical issues in the standards, the team is improving policy outcomes aligned with the economics of underlying risks and products.
• Supported the sale of Prudential’s Full-Service retirement business and a portion of its traditional Variable Annuity block of business to generate over US$4bn of proceeds that can be strategically redeployed. In each transaction, the treasury team managed the capital and liquidity implications of the sale, deal-specific issues, and rating agency communications to ensure the divestitures were well understood in the context of the go-forward financial and business profile of Prudential.
• Established new capabilities that helped the enterprise optimise its balance sheet by aligning reserves and capital to their view of underlying economics and by efficiently financing its capital structure.
• Enhanced operational efficiency of the team through tech-enabled initiatives and process improvements. Across the department, there has been an overall effort to transition from an Excel-based approach to utilising data visualisation and modelling tools such as Tableau and Anaplan to streamline reporting and manage a process more efficiently. In addition, teams are also using Python coding. For example, the borrowing team ensured the best pricing when undertaking capital markets activities by developing a Python-based dashboard that tracks debt pricing submitted by banks. They also streamlined quarterly covenant attestation processes by automating data collection processes for fees paid to banks. Additionally, corporate banking has managed to save more than 1,000 hours in resource time for the year by introducing a start/stop initiative which has now been broadened to include all teams in the department.
• Managed engagement with external stakeholders to achieve desired outcomes, including banks, rating agencies, regulatory bodies and debt investors.

The team’s actions in 2021 have generated many benefits, notably including the following:

• Redeployment of talent into more strategic work.
• Process efficiencies.
• Reduction of manual processes and errors.
• Increased automation.
• Risk mitigation.

Prudential’s talent-oriented culture allows my treasury team to bring out the best in one another and serve as catalysts to develop strategic solutions that are critical for our company in fulfilling our customer commitments.

Nandini Mongia, Senior Vice President and Treasurer

Engaging with environmental, social and governance commitments

The treasury team has played a vital role in deepening the company’s environmental, social and governance (ESG) commitments.

On environmental matters, Prudential renewed its five-year US$4bn credit facility with sustainability-linked terms in July 2021. This transaction, the first of its kind among major US insurers, included terms that incentivised Prudential to achieve its previously stated commitments, including reducing domestic greenhouse gas emissions and increasing the diversity of senior leaders. This transaction represented an important step in integrating the company’s ESG commitments into its liquidity framework.

On social issues, the treasury team has been partnering with diverse-owned firms for over 20 years and established a formal programme in 2013. The programme supports a group of such firms through various activities, aligned with the broader enterprise bank strategy and inclusion and diversity commitments. The team engages with these firms on various capital markets activities, including debt issuance, share repurchase, deposits and money market funds. The treasury team believes that the active allocation of Prudential’s resources to diverse organisations allows these firms to create a positive, measurable impact on communities and clients, helping enhance financial equity.

A diverse and inclusive team always ready to change

Prudential’s treasury team plays a critical role in supporting the company’s purpose of making lives better by solving the financial challenges of a changing world. In managing and optimising the capital and liquidity of the company, the team also ensures that Prudential can keep the promises underlying its products and client solutions. The team’s achievements over the last year demonstrate the collective power of its diverse talent and inclusive culture. Prudential recognises talent as a strategic differentiator in fulfilling its purpose. With that in mind, the treasury team has prioritised fostering an environment with a diversity of perspectives and richness of thoughts. As these different thoughts collide, the team generates new solutions and innovations.