PRUDENTIAL FINANCIAL INC - FORM 8-K - EX-99.1 - QUARTERLY FINANCIAL SUPPLEMENT

Attached files

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8-K - FORM 8-K - PRUDENTIAL FINANCIAL INC	d8k.htm
EX-99.0 - NEWS RELEASE OF PRUDENTIAL FINANCIAL, INC., DATED AUGUST 4, 2010 - PRUDENTIAL FINANCIAL INC	dex990.htm

Exhibit 99.1

Prudential Financial, Inc. (PRU)

LOGO

Quarterly Financial Supplement

FINANCIAL SERVICES BUSINESSES

SECOND QUARTER 2010

Reference is made to Prudential Financial, Inc.’s filings with the Securities and Exchange Commission for general information, and consolidated financial information, regarding Prudential Financial, Inc., including its Closed Block Business. All financial information in this document is unaudited.

August 4, 2010

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

CONTENTS


		Page
HIGHLIGHTS
Financial Highlights		1-3
Operations Highlights		4

FINANCIAL SERVICES BUSINESSES
Combined Statements of Operations		5
Combined Balance Sheets		6
Combining Statements of Operations by Division (Quarter)		7
Combining Statements of Operations by Division		8
Combining Balance Sheets by Division		9
Short-Term and Long-Term Debt		10

U.S. RETIREMENT SOLUTIONS AND INVESTMENT MANAGEMENT DIVISION
Combined Statements of Operations		11
Combining Statements of Operations		12
Individual Annuities Sales Results and Account Values		13
Individual Annuities Account Value Activity		14
Individual Annuities Living Benefit Features		15
Individual Annuities Death Benefit Features		16
Retirement Segment Sales Results and Account Values		17
Supplementary Revenue And Assets Under Management Information for Asset Management Segment		18
Supplementary Assets Under Management and Assets Under Administration Information for Asset Management Segment		19

U.S. INDIVIDUAL LIFE AND GROUP INSURANCE DIVISION
Combined Statements of Operations		20
Combining Statements of Operations		21
Individual Life Annualized New Business Premiums, Account Value Activity, and Face Amount in Force		22
Supplementary Information for Individual Life Insurance		23
Supplementary Information for Group Insurance		24

DEFERRED POLICY ACQUISITION COSTS & DEFERRED SALES INDUCEMENTS - INDIVIDUAL ANNUITIES, INDIVIDUAL LIFE AND GROUP INSURANCE		25

INTERNATIONAL INSURANCE AND INVESTMENTS DIVISION
Combined Statements of Operations		26
Combining Statements of Operations		27
International Insurance Segment - Supplementary Income Statement Information		28
Sales Results and Supplementary Information		29-30

INVESTMENT PORTFOLIO
Investment Portfolio Composition		31
Financial Services Businesses Investment Portfolio Composition - Japanese Insurance Operations and Excluding Japanese Insurance Operations		32
Financial Services Businesses Investment Results		33
Financial Services Businesses Investment Results - Japanese Insurance Operations		34
Financial Services Businesses Investment Results - Excluding Japanese Insurance Operations		35

KEY DEFINITIONS AND FORMULAS		36-38

RATINGS AND INVESTOR INFORMATION		39

Page ii

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

FINANCIAL HIGHLIGHTS

(in millions, except per share data)


Year-to-date				%		2009						2010
2010		2009		Change		2Q		3Q		4Q		1Q		2Q

					*Financial Services Businesses:*
					Pre-tax adjusted operating income (loss) by division:
1,066		739		44%	U.S. Retirement Solutions and Investment Management Division	564		314		215		514		552
264		376		-30%	U.S. Individual Life and Group Insurance Division	243		307		210		144		120
974		908		7%	International Insurance and Investments Division	476		507		455		496		478
(386	)	(343	)	-13%	Corporate and other operations	(168	)	(207	)	(205	)	(202	)	(184	)

1,918		1,680		14%	Total pre-tax adjusted operating income	1,115		921		675		952		966
511		444		15%	Income taxes, applicable to adjusted operating income	306		198		185		253		258

1,407		1,236		14%	Financial Services Businesses after-tax adjusted operating income	809		723		490		699		708


					Reconciling items:
128		(1,531	)	108%	Realized investment gains (losses), net, and related charges and adjustments	(868	)	(226	)	44		(84	)	212
331		831		-60%	Investment gains on trading account assets supporting insurance liabilities, net	686		694		76		252		79
(464	)	(392	)	-18%	Change in experience-rated contractholder liabilities due to asset value changes	(347	)	(458	)	(49	)	(320	)	(144	)
(14	)	(56	)	75%	Divested businesses	(24	)	25		2,162		(7	)	(7	)
(18	)	17		-206%	Equity in earnings of operating joint ventures and earnings attributable to noncontrolling interests	14		(92	)	(2,289	)	(36	)	18

(37	)	(1,131	)	97%	Total reconciling items, before income taxes	(539	)	(57	)	(56	)	(195	)	158
52		(409	)	113%	Income taxes, not applicable to adjusted operating income	(258	)	(343	)	64		2		50

(89	)	(722	)	88%	Total reconciling items, after income taxes	(281	)	286		(120	)	(197	)	108

1,318		514		156%	Income from continuing operations (after-tax) of Financial Services Businesses before equity in earnings of operating joint ventures	528		1,009		370		502		816
18		(7	)	357%	Equity in earnings of operating joint ventures, net of taxes and earnings attributable to noncontrolling interests	(12	)	81		1,483		36		(18	)

1,336		507		164%	Income from continuing operations attributable to Prudential Financial, Inc.	516		1,090		1,853		538		798
1		6		-83%	Earnings attributable to noncontrolling interests	17		(50	)	10		(26	)	27

1,337		513		161%	Income from continuing operations (after-tax) of Financial Services Businesses	533		1,040		1,863		512		825
(2	)	26		-108%	Income (loss) from discontinued operations, net of taxes	22		—		(65	)	(2	)	—

1,335		539		148%	Net income of Financial Services Businesses	555		1,040		1,798		510		825
1		6		-83%	Less: Income (loss) attributable to noncontrolling interests	17		(50	)	10		(26	)	27

1,334		533		150%	Net income of Financial Services Businesses attributable to Prudential Financial, Inc.	538		1,090		1,788		536		798

10.96%		12.04%			Operating Return on Average Equity (based on adjusted operating income)	15.33%		12.68%		8.09%		11.04%		10.90%

					*Reconciliation to Consolidated Net Income Attributable to Prudential Financial, Inc:*
1,334		533			Net income of Financial Services Businesses attributable to Prudential Financial, Inc. (above)	538		1,090		1,788		536		798
440		(356	)		Net income (loss) of Closed Block Business attributable to Prudential Financial, Inc.	(375	)	(8	)	77		161		279

1,774		177			Consolidated net income attributable to Prudential Financial, Inc.	163		1,082		1,865		697		1,077

Page 1

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

FINANCIAL HIGHLIGHTS

(in millions, except per share data)


Year-to-date					2009						2010
2010		2009			2Q		3Q		4Q		1Q		2Q

				Earnings per share of Common Stock (diluted):
3.00		2.90		Financial Services Businesses after-tax adjusted operating income	1.87		1.57		1.06		1.49		1.51

				Reconciling items:
0.27		(3.57	)	Realized investment gains (losses), net, and related charges and adjustments	(2.00	)	(0.49	)	0.09		(0.18	)	0.45
0.70		1.94		Investment gains on trading account assets supporting insurance liabilities, net	1.58		1.49		0.16		0.53		0.17
(0.98	)	(0.91	)	Change in experience-rated contractholder liabilities due to asset value changes	(0.80	)	(0.99	)	(0.10	)	(0.68	)	(0.30	)
(0.03	)	(0.13	)	Divested businesses	(0.06	)	0.05		4.60		(0.01	)	(0.01	)
—		0.01		Difference in earnings allocated to participating unvested share-based payment awards	0.01		—		(0.03	)	—		(0.01	)

(0.04	)	(2.66	)	Total reconciling items, before income taxes	(1.27	)	0.06		4.72		(0.34	)	0.30
0.11		(0.98	)	Income taxes, not applicable to adjusted operating income	(0.60	)	(0.72	)	1.86		(0.01	)	0.11

(0.15	)	(1.68	)	Total reconciling items, after income taxes	(0.67	)	0.78		2.86		(0.33	)	0.19

2.85		1.22		Income from continuing operations (after-tax) of Financial Services Businesses attributable to Prudential Financial, Inc.	1.20		2.35		3.92		1.16		1.70
—		0.06		Income (loss) from discontinued operations, net of taxes	0.05		—		(0.14	)	(0.01	)	—

2.85		1.28		Net income of Financial Services Businesses attributable to Prudential Financial, Inc.	1.25		2.35		3.78		1.15		1.70


463.7		427.5		Weighted average number of outstanding Common shares (basic)	432.9		461.2		461.8		463.0		464.3

472.4		428.7		Weighted average number of outstanding Common shares (diluted)	434.3		464.6		470.3		471.5		473.3

20		22		Direct equity adjustments for earnings per share calculation	11		12		9		10		10

9		—		Earnings related to interest, net of tax, on exchangeable surplus notes	—		1		4		4		5

				*Earnings allocated to participating unvested share-based payment awards for earnings per share calculation*
18		14		Financial Services Businesses after-tax adjusted operating income	10		8		6		9		9
17		6		Income from continuing operations (after-tax) of Financial Services Businesses	6		12		21		7		10

Page 2

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

FINANCIAL HIGHLIGHTS

(in millions, except per share data)


Year-to-date			2009			2010
2010	2009		2Q	3Q	4Q	1Q	2Q

		*Financial Services Businesses Capitalization Data (1):*
		Senior Debt:
		Short-term debt	3,643	2,182	3,122	3,066	2,219
		Long-term debt	17,713	19,491	17,769	18,373	19,130
		Junior Subordinated Long-Term Debt	1,518	1,518	1,518	1,518	1,519

		Attributed Equity:
		Including accumulated other comprehensive income	18,681	23,239	24,154	25,721	28,233
		Excluding accumulated other comprehensive income related to unrealized gains and losses on investments and pension / postretirement benefits	22,452	23,919	25,399	25,961	26,758
		Excluding total accumulated other comprehensive income	22,194	23,338	24,728	25,318	26,193

		Total Capitalization:
		Including accumulated other comprehensive income	37,912	44,248	43,441	45,612	48,882
		Excluding accumulated other comprehensive income related to unrealized gains and losses on investments and pension / postretirement benefits	41,683	44,928	44,686	45,852	47,407
		Excluding total accumulated other comprehensive income	41,425	44,347	44,015	45,209	46,842

		Book value per share of Common Stock:
		Including accumulated other comprehensive income	40.20	49.71	51.52	54.63	59.94
		Excluding accumulated other comprehensive income related to unrealized gains and losses on investments and pension / postretirement benefits	48.32	51.16	54.18	55.14	56.81
		Excluding total accumulated other comprehensive income	47.76	49.92	52.75	53.78	55.61

		Number of diluted shares at end of period (2)	464.7	467.5	468.8	470.8	471.0

		*Common Stock Price Range (based on closing price):*
65.82	46.00	High	46.00	54.63	52.82	60.50	65.82
47.02	11.29	Low	20.50	33.28	44.64	47.02	53.66
53.66	37.22	Close	37.22	49.91	49.76	60.50	53.66

		*Common Stock market capitalization (1)*	17,139	23,024	22,995	28,048	24,923

(1)	As of end of period.

(2)	Beginning third quarter 2009, the number of diluted shares at end of period excludes the impact of exchangeable surplus notes due to the anti-dilutive impact of conversion at $98.78 per share.

Page 3

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

OPERATIONS HIGHLIGHTS


Year-to-date			2009			2010
2010	2009		2Q	3Q	4Q	1Q	2Q

		*Assets Under Management and Administration ($ billions) (1) (2):*
		Assets Under Management :
		Managed by U.S. Retirement Solutions and Investment Management Division:
		Asset Management Segment - Investment Management & Advisory Services
		Institutional customers	163.5	179.9	188.4	193.3	203.5
		Retail customers	70.3	79.1	84.4	89.0	84.2
		General account	175.6	184.9	184.0	189.8	196.6

		Total Investment Management and Advisory Services	409.4	443.9	456.8	472.1	484.3
		Non-proprietary assets under management	89.3	109.4	122.3	126.8	118.3

		Total managed by U.S. Retirement Solutions and Investment Management Division	498.7	553.3	579.1	598.9	602.6
		Managed by U.S. Individual Life and Group Insurance Division	11.2	12.1	12.4	13.1	13.2
		Managed by International Insurance and Investments Division	69.7	75.5	75.8	81.3	74.0

		Total assets under management	579.6	640.9	667.3	693.3	689.8
		Client assets under administration	106.7	116.3	119.5	99.9	90.3

		Total assets under management and administration	686.3	757.2	786.8	793.2	780.1


		Assets managed or administered for customers outside of the United States at end of period	115.2	127.0	130.0	137.6	129.3

		*Distribution Representatives (1):*
		Prudential Agents	2,421	2,453	2,447	2,499	2,480
		International Life Planners	6,375	6,484	6,609	6,649	6,605
		Gibraltar Life Advisors	6,376	6,060	6,398	5,971	6,101

47	45	*Prudential Agent productivity ($ thousands)*	49	58	56	43	52

(1)	As of end of period.

(2)	At fair market value.

Page 4

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

COMBINED STATEMENTS OF OPERATIONS - FINANCIAL SERVICES BUSINESSES

(in millions)


Year-to-date				% Change		2009						2010
2010		2009		% Change		2Q		3Q		4Q		1Q		2Q

					Revenues (1):
7,339		6,581		12%	Premiums	3,320		3,361		3,352		3,531		3,808
1,748		1,500		17%	Policy charges and fee income	766		693		840		860		888
4,186		4,107		2%	Net investment income	2,049		2,051		2,055		2,075		2,111
2,826		2,081		36%	Asset management fees, commissions and other income	167		462		509		889		1,937

16,099		14,269		13%	Total revenues	6,302		6,567		6,756		7,355		8,744


					Benefits and Expenses (1):
7,431		6,392		16%	Insurance and annuity benefits	2,928		3,115		3,202		3,431		4,000
1,932		1,811		7%	Interest credited to policyholders’ account balances	725		831		818		883		1,049
509		485		5%	Interest expense	238		229		241		251		258
(1,463	)	(1,219	)	-20%	Deferral of acquisition costs	(641	)	(782	)	(768	)	(717	)	(746	)
1,371		1,135		21%	Amortization of acquisition costs	(70	)	102		285		414		957
4,401		3,985		10%	General and administrative expenses	2,007		2,151		2,303		2,141		2,260

14,181		12,589		13%	Total benefits and expenses	5,187		5,646		6,081		6,403		7,778

1,918		1,680		14%	Adjusted operating income before income taxes	1,115		921		675		952		966


					Reconciling items:
196		(1,570	)	112%	Realized investment gains (losses), net, and related adjustments	(863	)	(175	)	120		(55	)	251
(68	)	39		-274%	Related charges	(5	)	(51	)	(76	)	(29	)	(39	)

128		(1,531	)	108%	Total realized investment gains (losses), net, and related charges and adjustments	(868	)	(226	)	44		(84	)	212

331		831		-60%	Investment gains on trading account assets supporting insurance liabilities, net	686		694		76		252		79
(464	)	(392	)	-18%	Change in experience-rated contractholder liabilities due to asset value changes	(347	)	(458	)	(49	)	(320	)	(144	)
(14	)	(56	)	75%	Divested businesses	(24	)	25		2,162		(7	)	(7	)
(18	)	17		-206%	Equity in earnings of operating joint ventures and earnings attributable to noncontrolling interests	14		(92	)	(2,289	)	(36	)	18

(37	)	(1,131	)	97%	Total reconciling items, before income taxes	(539	)	(57	)	(56	)	(195	)	158


1,881		549		243%	Income from continuing operations before income taxes and equity in earnings of operating joint ventures	576		864		619		757		1,124
563		35		1509%	Income tax expense (benefit)	48		(145	)	249		255		308

1,318		514		156%	Income from continuing operations before equity in earnings of operating joint ventures	528		1,009		370		502		816

(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 other than those classified as divested businesses. Benefits and expenses exclude charges related to realized investment gains, net of losses; change in experience-rated contractholder liabilities due to asset value changes and benefits and expenses of divested businesses and include charges for income attributable to non controlling interests.

Page 5

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

COMBINED BALANCE SHEETS - FINANCIAL SERVICES BUSINESSES

(in millions)


	6/30/2009		9/30/2009		12/31/2009		3/31/2010	6/30/2010

Assets:
Investments:
Fixed maturities, available for sale, at fair value (amortized cost $123,430; $127,490; $131,727; $134,359; $134,883)	119,084		128,459		132,694		136,792	140,610
Fixed maturities, held to maturity, at amortized cost (fair value $4,938; $5,199; $5,197; $5,081; $5,209)	4,935		5,141		5,120		5,016	5,023
Trading account assets supporting insurance liabilities, at fair value	14,766		15,848		16,020		16,683	16,733
Other trading account assets, at fair value	3,550		3,656		2,866		3,222	5,358
Equity securities, available for sale, at fair value (cost $3,380; $3,390; $3,459; $3,367; $3,340)	3,404		3,747		3,810		3,824	3,747
Commercial mortgage and other loans	23,961		23,616		23,021		22,557	23,097
Policy loans	4,413		4,634		4,728		4,825	4,915
Other long-term investments	4,170		4,296		4,359		4,340	4,321
Short-term investments	5,790		6,078		5,487		5,826	5,673

Total investments	184,073		195,475		198,105		203,085	209,477
Cash and cash equivalents	11,798		10,524		12,451		8,996	10,751
Accrued investment income	1,571		1,613		1,668		1,657	1,682
Deferred policy acquisition costs	12,768		13,313		13,751		13,962	13,432
Other assets	19,142		19,964		15,222		15,597	14,784
Separate account assets	151,266		168,128		174,074		182,621	179,260

Total assets	380,618		409,017		415,271		425,918	429,386


Liabilities:
Future policy benefits	69,699		72,774		73,931		74,103	76,982
Policyholders' account balances	95,680		95,766		96,078		96,082	97,033
Securities sold under agreements to repurchase	3,467		3,650		2,985		2,969	2,683
Cash collateral for loaned securities	2,233		2,573		2,323		2,380	1,866
Income taxes	2,213		3,935		4,665		4,563	5,747
Senior short-term debt	3,643		2,182		3,122		3,066	2,219
Senior long-term debt	17,713		19,491		17,769		18,373	19,130
Junior subordinated long-term debt	1,518		1,518		1,518		1,518	1,519
Other liabilities	13,903		15,212		14,118		14,016	14,169
Separate account liabilities	151,266		168,128		174,074		182,621	179,260

Total liabilities	361,335		385,229		390,583		399,691	400,608


Attributed Equity:
Accumulated other comprehensive income (loss)	(3,513	)	(99	)	(574	)	403	2,040
Other attributed equity	22,194		23,338		24,728		25,318	26,193

Total attributed equity	18,681		23,239		24,154		25,721	28,233

Noncontrolling Interest	602		549		534		506	545

Total Equity	19,283		23,788		24,688		26,227	28,778

Total liabilities and equity	380,618		409,017		415,271		425,918	429,386

Page 6

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

FINANCIAL SERVICES BUSINESSES COMBINING STATEMENTS OF OPERATIONS - BY DIVISION

(in millions)


	Quarter Ended June 30, 2010
	Total Financial Services Businesses		U.S. Retirement Solutions & Investment Management Division		U.S. Individual Life & Group Insurance Division		International Insurance & Investments Division		Corporate and Other Operations
Revenues (1) :
Premiums	3,808		391		1,190		2,232		(5	)
Policy charges and fee income	888		393		406		96		(7	)
Net investment income	2,111		1,050		389		578		94
Asset management fees, commissions and other income	1,937		1,819		82		113		(77	)

Total revenues	8,744		3,653		2,067		3,019		5


Benefits and Expenses (1):
Insurance and annuity benefits	4,000		839		1,308		1,815		38
Interest credited to policyholders’ account balances	1,049		814		124		130		(19	)
Interest expense	258		23		37		—		198
Deferral of acquisition costs	(746	)	(323	)	(109	)	(327	)	13
Amortization of acquisition costs	957		610		156		213		(22	)
General and administrative expenses	2,260		1,138		431		710		(19	)

Total benefits and expenses	7,778		3,101		1,947		2,541		189


Adjusted operating income (loss) before income taxes	966		552		120		478		(184	)


	Quarter Ended June 30, 2009
	Total Financial Services Businesses		U.S. Retirement Solutions & Investment Management Division		U.S. Individual Life & Group Insurance Division		International Insurance & Investments Division		Corporate and Other Operations
Revenues (1):
Premiums	3,320		261		1,156		1,911		(8	)
Policy charges and fee income	766		269		412		91		(6	)
Net investment income	2,049		1,114		350		506		79
Asset management fees, commissions and other income	167		43		88		101		(65	)

Total revenues	6,302		1,687		2,006		2,609		—


Benefits and Expenses (1):
Insurance and annuity benefits	2,928		257		1,222		1,465		(16	)
Interest credited to policyholders’ account balances	725		527		119		110		(31	)
Interest expense	238		16		47		1		174
Deferral of acquisition costs	(641	)	(217	)	(136	)	(299	)	11
Amortization of acquisition costs	(70	)	(351	)	74		214		(7	)
General and administrative expenses	2,007		891		437		642		37

Total benefits and expenses	5,187		1,123		1,763		2,133		168


Adjusted operating income (loss) before income taxes	1,115		564		243		476		(168	)

(1)

Page 7

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

FINANCIAL SERVICES BUSINESSES COMBINING STATEMENTS OF OPERATIONS - BY DIVISION

(in millions)


	Six Months Ended June 30, 2010
	Total Financial Services Businesses		U.S. Retirement Solutions & Investment Management Division		U.S. Individual Life & Group Insurance Division		International Insurance & Investments Division		Corporate and Other Operations
Revenues (1) :
Premiums	7,339		537		2,362		4,449		(9	)
Policy charges and fee income	1,748		791		781		191		(15	)
Net investment income	4,186		2,095		764		1,161		166
Asset management fees, commissions and other income	2,826		2,614		158		212		(158	)

Total revenues	16,099		6,037		4,065		6,013		(16	)


Benefits and Expenses (1):
Insurance and annuity benefits	7,431		1,174		2,631		3,585		41
Interest credited to policyholders’ account balances	1,932		1,459		250		264		(41	)
Interest expense	509		45		72		1		391
Deferral of acquisition costs	(1,463	)	(592	)	(227	)	(666	)	22
Amortization of acquisition costs	1,371		758		216		428		(31	)
General and administrative expenses	4,401		2,127		859		1,427		(12	)

Total benefits and expenses	14,181		4,971		3,801		5,039		370


Adjusted operating income (loss) before income taxes	1,918		1,066		264		974		(386	)


	Six Months Ended June 30, 2009
	Total Financial Services Businesses		U.S. Retirement Solutions & Investment Management Division		U.S. Individual Life & Group Insurance Division		International Insurance & Investments Division		Corporate and Other Operations
Revenues (1):
Premiums	6,581		436		2,346		3,810		(11	)
Policy charges and fee income	1,500		518		805		190		(13	)
Net investment income	4,107		2,260		703		1,035		109
Asset management fees, commissions and other income	2,081		1,836		165		186		(106	)

Total revenues	14,269		5,050		4,019		5,221		(21	)


Benefits and Expenses (1):
Insurance and annuity benefits	6,392		899		2,498		2,966		29
Interest credited to policyholders’ account balances	1,811		1,422		238		229		(78	)
Interest expense	485		41		98		2		344
Deferral of acquisition costs	(1,219	)	(366	)	(261	)	(608	)	16
Amortization of acquisition costs	1,135		527		210		416		(18	)
General and administrative expenses	3,985		1,788		860		1,308		29

Total benefits and expenses	12,589		4,311		3,643		4,313		322


Adjusted operating income (loss) before income taxes	1,680		739		376		908		(343	)

(1)

Page 8

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

FINANCIAL SERVICES BUSINESSES COMBINING BALANCE SHEETS - BY DIVISION

(in millions)


	As of June 30, 2010
	Total Financial Services Businesses		U.S. Retirement Solutions & Investment Management Division	U.S. Individual Life & Group Insurance Division	International Insurance & Investments Division	Corporate and Other Operations
Assets:
Total investments	209,477		89,400	31,105	80,547	8,425
Deferred policy acquisition costs	13,432		2,427	4,415	6,724	(134	)
Other assets	27,217		7,360	3,198	8,790	7,869
Separate account assets	179,260		146,886	33,712	540	(1,878	)

Total assets	429,386		246,073	72,430	96,601	14,282


Liabilities:
Future policy benefits	76,982		17,218	9,553	49,800	411
Policyholders’ account balances	97,033		57,475	15,169	25,717	(1,328	)
Debt	22,868		3,373	5,499	486	13,510
Other liabilities	24,465		8,292	3,351	10,383	2,439
Separate account liabilities	179,260		146,886	33,712	540	(1,878	)

Total liabilities	400,608		233,244	67,284	86,926	13,154


Attributed Equity:
Accumulated other comprehensive income (loss)	2,040		1,265	763	1,446	(1,434	)
Other attributed equity	26,193		10,948	4,383	8,223	2,639

Total attributed equity	28,233		12,213	5,146	9,669	1,205

Noncontrolling Interest	545		616	—	6	(77	)

Total Equity	28,778		12,829	5,146	9,675	1,128


Total liabilities and equity	429,386		246,073	72,430	96,601	14,282


	As of December 31, 2009
	Total Financial Services Businesses		U.S. Retirement Solutions & Investment Management Division	U.S. Individual Life & Group Insurance Division	International Insurance & Investments Division	Corporate and Other Operations
Assets:
Total investments	198,105		86,016	28,196	76,367	7,526
Deferred policy acquisition costs	13,751		2,722	4,550	6,627	(148	)
Other assets	29,341		7,806	3,006	9,131	9,398
Separate account assets	174,074		141,330	34,100	462	(1,818	)

Total assets	415,271		237,874	69,852	92,587	14,958


Liabilities:
Future policy benefits	73,931		15,335	9,122	49,079	395
Policyholders’ account balances	96,078		58,154	14,772	24,966	(1,814	)
Debt	22,409		3,570	4,994	490	13,355
Other liabilities	24,091		7,747	2,646	9,567	4,131
Separate account liabilities	174,074		141,330	34,100	462	(1,818	)

Total liabilities	390,583		226,136	65,634	84,564	14,249


Attributed Equity:
Accumulated other comprehensive income (loss)	(574	)	532	148	281	(1,535	)
Other attributed equity	24,728		10,612	4,070	7,735	2,311

Total attributed equity	24,154		11,144	4,218	8,016	776

Noncontrolling Interest	534		594	—	7	(67	)

Total Equity	24,688		11,738	4,218	8,023	709


Total liabilities and equity	415,271		237,874	69,852	92,587	14,958

Page 9

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

SHORT-TERM AND LONG-TERM DEBT

(in millions)


	As of June 30, 2010					As of December 31, 2009
	Senior debt		Junior Subordinated	Total Debt		Senior debt		Junior Subordinated	Total Debt
	Short-term Debt	Long-term Debt	Long-term Debt	Total Debt		Short-term Debt	Long-term Debt	Long-term Debt	Total Debt
Financial Services Businesses
*Borrowings by use of proceeds:*
Capital Debt	392	7,170	1,519	9,081		389	6,546	1,518	8,453
Investment related	811	8,859	—	9,670		1,247	7,998	—	9,245
Securities business related	371	1,586	—	1,957		1,015	1,283	—	2,298
Specified other businesses	645	1,515	—	2,160		471	1,513	—	1,984
Limited recourse and non-recourse borrowing	—	—	—	—		—	429	—	429

Total debt - Financial Services Businesses	2,219	19,130	1,519	22,868		3,122	17,769	1,518	22,409

Ratio of long-term and short-term capital debt to capitalization (1)				24.3	%				21.6	%

Closed Block Business
Investment related	—	—	—	—		—	—	—	—
Limited recourse and non-recourse borrowing	—	1,750	—	1,750		—	1,750	—	1,750

Total debt	—	1,750	—	1,750		—	1,750	—	1,750


	As of June 30, 2010					As of December 31, 2009
	Prudential Financial, Inc.	The Prudential Insurance Co. of America (2)(3)	Other Affiliates	Total		Prudential Financial, Inc.	The Prudential Insurance Co. of America (2)(3)	Other Affiliates	Total
Financial Services Businesses
*Borrowings by sources:*
Capital Debt	7,648	1,335	98	9,081		6,973	1,335	145	8,453
Investment related	5,632	785	3,253	9,670		4,760	1,212	3,273	9,245
Securities business related	1,764	193	—	1,957		1,422	826	50	2,298
Specified other businesses	1,515	645	—	2,160		1,513	471	—	1,984
Limited recourse and non-recourse borrowing	—	—	—	—		—	—	429	429

Total debt - Financial Services Businesses	16,559	2,958	3,351	22,868		14,668	3,844	3,897	22,409

(1)

As a result of Moody’s revised guidance regarding the treatment of hybrid securities, for the purposes of calculating the ratio of capital debt to capitalization, Junior Subordinated Notes are considered 25% equity and 75% debt, effective June 30, 2010. For the calculation of this ratio for periods prior to June 30, 2010, Junior Subordinated Notes are considered 25% debt and 75% equity.

(2)	Includes Prudential Funding, LLC.

(3)	Capital debt at Prudential Insurance Co. of America includes $942 million of Surplus Notes for June 30, 2010 and $941 million for December 31, 2009.

Page 10

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

COMBINED STATEMENTS OF OPERATIONS - U.S. RETIREMENT SOLUTIONS AND INVESTMENT MANAGEMENT DIVISION

(in millions)


Year-to-date				% Change		2009						2010
2010		2009		% Change		2Q		3Q		4Q		1Q		2Q

					Revenues (1):
537		436		23%	Premiums	261		118		136		146		391
791		518		53%	Policy charges and fee income	269		313		358		398		393
2,095		2,260		-7%	Net investment income	1,114		1,064		1,054		1,045		1,050
2,614		1,836		42%	Asset management fees, commissions and other income	43		321		390		795		1,819

6,037		5,050		20%	Total revenues	1,687		1,816		1,938		2,384		3,653


					Benefits and Expenses (1):
1,174		899		31%	Insurance and annuity benefits	257		210		360		335		839
1,459		1,422		3%	Interest credited to policyholders’ account balances	527		604		583		645		814
45		41		10%	Interest expense	16		14		13		22		23
(592	)	(366	)	-62%	Deferral of acquisition costs	(217	)	(347	)	(310	)	(269	)	(323	)
758		527		44%	Amortization of acquisition costs	(351	)	24		(3	)	148		610
2,127		1,788		19%	General and administrative expenses	891		997		1,080		989		1,138

4,971		4,311		15%	Total benefits and expenses	1,123		1,502		1,723		1,870		3,101

1,066		739		44%	Adjusted operating income before income taxes	564		314		215		514		552

(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. Benefits and expenses exclude charges related to realized investment gains, net of losses and change in experience-rated contractholder liabilities due to asset value changes and include charges for income attributable to non controlling interests.

Page 11

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

COMBINING STATEMENTS OF OPERATIONS - U.S. RETIREMENT SOLUTIONS AND INVESTMENT MANAGEMENT DIVISION

(in millions)


	Six Months Ended June 30, 2010								Quarter Ended June 30, 2010
	Total U.S. Retirement Solutions & Investment Management Division		Individual Annuities		Retirement		Asset Management		Total U.S. Retirement Solutions & Investment Management Division		Individual Annuities		Retirement		Asset Management
Revenues (1):
Premiums	537		80		457		—		391		43		348		—
Policy charges and fee income	791		690		101		—		393		345		48		—
Net investment income	2,095		440		1,602		53		1,050		216		805		29
Asset management fees, commissions and other income	2,614		1,446		348		820		1,819		1,179		175		465

Total revenues	6,037		2,656		2,508		873		3,653		1,783		1,376		494


Benefits and Expenses (1):
Insurance and annuity benefits	1,174		337		837		—		839		298		541		—
Interest credited to policyholders’ account balances	1,459		550		909		—		814		356		458		—
Interest expense	45		30		8		7		23		15		4		4
Deferral of acquisition costs	(592	)	(552	)	(28	)	(12	)	(323	)	(299	)	(18	)	(6	)
Amortization of acquisition costs	758		734		11		13		610		597		6		7
General and administrative expenses (2)	2,127		1,011		458		658		1,138		530		243		365

Total benefits and expenses	4,971		2,110		2,195		666		3,101		1,497		1,234		370

Adjusted operating income before income taxes	1,066		546		313		207		552		286		142		124


	Six Months Ended June 30, 2009								Quarter Ended June 30, 2009
	Total U.S. Retirement Solutions & Investment Management Division		Individual Annuities		Retirement		Asset Management		Total U.S. Retirement Solutions & Investment Management Division		Individual Annuities		Retirement		Asset Management
Revenues (1):
Premiums	436		33		403		—		261		16		245		—
Policy charges and fee income	518		420		98		—		269		220		49		—
Net investment income	2,260		525		1,692		43		1,114		251		831		32
Asset management fees, commissions and other income	1,836		1,029		245		562		43		(372	)	105		310

Total revenues	5,050		2,007		2,438		605		1,687		115		1,230		342


Benefits and Expenses (1):
Insurance and annuity benefits	899		125		774		—		257		(179	)	436		—
Interest credited to policyholders’ account balances	1,422		450		972		—		527		43		484		—
Interest expense	41		7		18		16		16		3		6		7
Deferral of acquisition costs	(366	)	(329	)	(29	)	(8	)	(217	)	(197	)	(15	)	(5	)
Amortization of acquisition costs	527		507		12		8		(351	)	(355	)	—		4
General and administrative expenses (2)	1,788		798		433		557		891		368		220		303

Total benefits and expenses	4,311		1,558		2,180		573		1,123		(317	)	1,131		309

Adjusted operating income before income taxes	739		449		258		32		564		432		99		33

(1)

(2)

General and administrative expenses for Individual Annuities include $9 million for the six months ended June 30, 2010 and $146 million for the six months ended June 30, 2009, $6 million for the quarter ended June 30, 2010 and $(4) million for the quarter ended June 30, 2009 for the amortization, net of interest, of value of business acquired (VOBA).

Page 12

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

U.S. RETIREMENT SOLUTIONS AND INVESTMENT MANAGEMENT DIVISION - INDIVIDUAL ANNUITIES SALES RESULTS AND ACCOUNT VALUES

(in millions)


Year-to-date					2009						2010
2010		2009			2Q		3Q		4Q		1Q		2Q

				SALES AND ACCOUNT VALUES:

				Variable Annuities:
80,519		60,007		Beginning total account value	57,942		65,099		75,611		80,519		85,379
10,175		5,486		Sales	3,378		5,829		4,802		4,867		5,308
(3,384	)	(2,758	)	Surrenders and withdrawals	(1,315	)	(1,444	)	(1,574	)	(1,670	)	(1,714	)

6,791		2,728		Net sales	2,063		4,385		3,228		3,197		3,594
(469	)	(492	)	Benefit payments	(236	)	(239	)	(257	)	(266	)	(203	)

6,322		2,236		Net flows	1,827		4,146		2,971		2,931		3,391
(2,496	)	3,297		Change in market value, interest credited, and other (1)	5,566		6,650		2,273		2,288		(4,784	)
(752	)	(441	)	Policy charges	(236	)	(284	)	(336	)	(359	)	(393	)

83,593		65,099		Ending total account value	65,099		75,611		80,519		85,379		83,593


				Fixed Annuities:
3,452		3,295		Beginning total account value	3,263		3,221		3,213		3,452		3,739
62		96		Sales	41		46		37		30		32
(126	)	(152	)	Surrenders and withdrawals	(75	)	(49	)	(57	)	(48	)	(78	)

(64	)	(56	)	Net redemptions	(34	)	(3	)	(20	)	(18	)	(46	)
(137	)	(80	)	Benefit payments	(37	)	(41	)	(39	)	(57	)	(80	)

(201	)	(136	)	Net flows	(71	)	(44	)	(59	)	(75	)	(126	)
516		63		Interest credited and other (1)	30		36		298		363		153
(1	)	(1	)	Policy charges	(1	)	—		—		(1	)	—

3,766		3,221		Ending total account value	3,221		3,213		3,452		3,739		3,766


				SALES BY DISTRIBUTION CHANNEL:

				Variable and Fixed Annuities (2):
1,336		996		Insurance Agents	531		735		664		623		713
2,211		1,029		Wirehouses	685		1,359		1,052		1,097		1,114
5,113		3,036		Independent Financial Planners (3)	1,850		3,138		2,470		2,460		2,653
1,577		521		Bank Distribution (3)	353		643		653		717		860

10,237		5,582		Total	3,419		5,875		4,839		4,897		5,340

(1)

Includes cumulative reclassifications during the first quarter of 2010 and the fourth quarter of 2009 of $267 million and $259 million, respectively, from variable annuity to fixed annuity account values to conform presentation of certain contracts in annuitization status to current reporting practices.

(2)	Amounts represent gross sales.

(3)	Sales from the bank distribution channel, previously included within sales from the independent financial planners channel, is being shown separately in order to provide a more meaningful presentation.

Page 13

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

U.S. RETIREMENT SOLUTIONS AND INVESTMENT MANAGEMENT DIVISION - INDIVIDUAL ANNUITIES ACCOUNT VALUE ACTIVITY

(in millions)


Year-to-date					2009						2010
2010		2009			2Q		3Q		4Q		1Q		2Q

				INDIVIDUAL ANNUITIES:

				Account Values in General Account (1):
14,606		18,110		Beginning balance	18,208		16,355		15,308		14,606		14,190
1,231		279		Premiums and deposits	196		638		566		604		627
(766	)	(742	)	Surrenders and withdrawals	(356	)	(411	)	(369	)	(364	)	(402	)

465		(463	)	Net sales (redemptions)	(160	)	227		197		240		225
(176	)	(176	)	Benefit payments	(83	)	(88	)	(85	)	(95	)	(81	)

289		(639	)	Net flows	(243	)	222		112		145		144
281		285		Interest credited and other	129		141		130		137		144
(777	)	(1,400	)	Net transfers to separate account	(1,738	)	(1,327	)	(944	)	(697	)	(80	)
(1	)	(1	)	Policy charges	(1	)	—		—		(1	)	—

14,398		16,355		Ending balance	16,355		15,308		14,606		14,190		14,398


				Account Values in Separate Account:
69,365		45,192		Beginning balance	42,997		51,965		63,516		69,365		74,928
9,006		5,303		Premiums and deposits	3,223		5,237		4,273		4,293		4,713
(2,744	)	(2,168	)	Surrenders and withdrawals	(1,034	)	(1,082	)	(1,262	)	(1,354	)	(1,390	)

6,262		3,135		Net sales	2,189		4,155		3,011		2,939		3,323
(430	)	(396	)	Benefit payments	(190	)	(192	)	(211	)	(228	)	(202	)

5,832		2,739		Net flows	1,999		3,963		2,800		2,711		3,121
(2,261	)	3,075		Change in market value, interest credited and other	5,467		6,545		2,441		2,514		(4,775	)
777		1,400		Net transfers from general account	1,738		1,327		944		697		80
(752	)	(441	)	Policy charges	(236	)	(284	)	(336	)	(359	)	(393	)

72,961		51,965		Ending balance	51,965		63,516		69,365		74,928		72,961

(1)

Premiums and deposits, and surrenders and withdrawals, are classified within the general account and separate account for purposes of this presentation based on the allocation of customer funds. For example, premiums allocated by customers to separate account investments at the time of sale, while remitted through the company’s general account, are shown as separate account premium in this display, rather than as general account premium and transfers to the separate account.

Page 14

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

U.S. RETIREMENT SOLUTIONS AND INVESTMENT MANAGEMENT DIVISION - INDIVIDUAL ANNUITIES LIVING BENEFIT FEATURES

(in millions)


	2009			2010
	2Q	3Q	4Q	1Q	2Q

LIVING BENEFIT FEATURES ACCOUNT VALUE AND NET AMOUNT AT RISK (1):

Variable Annuity Account Values with Living Benefit Features
Guaranteed minimum accumulation benefits	9,951	10,023	9,952	9,906	9,408
Guaranteed minimum withdrawal benefits	1,312	1,420	1,412	1,402	1,250
Guaranteed minimum income benefits	4,184	4,613	4,677	4,693	4,181
Guaranteed minimum withdrawal & income benefits	23,249	31,416	36,430	41,511	43,395

Total	38,696	47,472	52,471	57,512	58,234


Living Benefit Features Account Values by Product Design Type
Account Values with Auto-Rebalancing Feature	22,935	30,116	34,901	39,786	42,166
Account Values without Auto-Rebalancing Feature	15,761	17,356	17,570	17,726	16,068

Total	38,696	47,472	52,471	57,512	58,234


Living Benefit Features Net Amount at Risk by Product Design Type
Net Amount at Risk with Auto-Rebalancing Feature	1,250	1,129	1,061	1,104	2,200
Net Amount at Risk without Auto-Rebalancing Feature	4,286	2,895	2,785	2,479	3,384

Total	5,536	4,024	3,846	3,583	5,584

(1)	At end of period.

Page 15

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

U.S. RETIREMENT SOLUTIONS AND INVESTMENT MANAGEMENT DIVISION - INDIVIDUAL ANNUITIES DEATH BENEFIT FEATURES

(in millions)


	2009			2010
	2Q	3Q	4Q	1Q	2Q

DEATH BENEFIT FEATURES ACCOUNT VALUE AND NET AMOUNT AT RISK (1):

Variable Annuity Account Values by Death Benefit Features
Return of net deposits:
Account value	39,124	46,881	51,106	55,441	55,452
Net amount at risk	5,138	3,219	2,707	2,160	3,136
Minimum return, anniversary contract value, or maximum contract value:
Account value	22,358	24,880	25,770	26,546	25,069
Net amount at risk	8,438	6,472	5,891	5,345	6,758

Death Benefit Features Account Values by Product Design Type
Account Values with Auto-Rebalancing Feature	22,935	30,116	34,901	39,786	42,166
Account Values without Auto-Rebalancing Feature	38,547	41,645	41,975	42,201	38,355

Total	61,482	71,761	76,876	81,987	80,521


Death Benefit Features Net Amount at Risk by Product Design Type
Net Amount at Risk with Auto-Rebalancing Feature	1,328	863	800	719	1,342
Net Amount at Risk without Auto-Rebalancing Feature	12,248	8,828	7,798	6,786	8,552

Total	13,576	9,691	8,598	7,505	9,894

(1)	At end of period.

Page 16

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

U.S. RETIREMENT SOLUTIONS AND INVESTMENT MANAGEMENT DIVISION - RETIREMENT SEGMENT SALES RESULTS AND ACCOUNT VALUES

(in millions)


Year-to-date					2009						2010
2010		2009			2Q		3Q		4Q		1Q		2Q

				RETIREMENT SEGMENT SALES AND ACCOUNT VALUES

				Full Service:
126,345		99,738		Beginning total account value	102,159		110,950		121,756		126,345		131,147
9,642		14,379		Deposits and sales	3,890		4,789		4,020		5,605		4,037
(8,251	)	(8,034	)	Withdrawals and benefits	(3,803	)	(3,287	)	(3,117	)	(4,500	)	(3,751	)
(2,560	)	4,867		Change in market value, interest credited and interest income	8,704		9,304		3,686		3,697		(6,257	)

125,176		110,950		Ending total account value	110,950		121,756		126,345		131,147		125,176


1,391		6,345		Net additions	87		1,502		903		1,105		286


				Stable value account values included above	36,722		35,881		36,243		37,138		37,909

				Institutional Investment Products:
51,908		50,491		Beginning total account value	49,030		49,475		50,137		51,908		52,768
5,568		2,970		Additions (1)	2,343		1,329		3,487		1,876		3,692
(4,141	)	(3,309	)	Withdrawals and benefits (2)	(1,272	)	(2,523	)	(1,985	)	(2,139	)	(2,002	)
2,247		526		Change in market value, interest credited and interest income	678		1,548		213		799		1,448
383		(1,203	)	Other (3)	(1,304	)	308		56		324		59

55,965		49,475		Ending total account value	49,475		50,137		51,908		52,768		55,965


1,427		(339	)	Net additions (withdrawals)	1,071		(1,194	)	1,502		(263	)	1,690

(1)	Includes $500 million for the three and six months ended June 30, 2009, representing transfers of externally managed client balances to accounts managed by the company. These additions are offset within the “Other” category and there are no net impacts on ending account values for these transfers.

(2)

Includes $(317) million, $(171) million, $(411) million and $(34) million for the three months ended September 30, 2009, December 31, 2009, March 31, 2010 and June 30, 2010, respectively and $(445) million for the six months ended June 30, 2010, representing transfers of client balances managed by the Company to externally managed accounts. These withdrawals are offset within the “Other” category and there are no net impacts on ending account values for these transfers.

(3)

“Other” activity includes transfers to the Asset Management segment of $(11) million, $(43) million and $(3) million for the three months ended December 31, 2009, March 31, 2010 and June 30, 2010, respectively and $(46) million for the six months ended June 30, 2010. “Other” activity also includes $(500) million, $317 million, $171 million, $411 million and $34 million for the three months ended June 30, 2009, September 30, 2009, December 31, 2009, March 31, 2010 and June 30, 2010, respectively and $445 million for the six months ended June 30, 2010, related to transfers discussed above in notes 1 and 2. For the three months ended March 31, 2009 “Other” includes $1,500 million representing collateralized funding agreements issued to the Federal Home Loan Bank of New York (FHLBNY). “Other” also includes $(1,015) million, $(507) million and $(1,522) million for the three months ended March 31, 2009, June 30, 2009 and the six months ended June 30, 2009, respectively, representing terminations of affiliated funding agreements utilizing proceeds from the issuances to FHLBNY. The remainder of “Other” activity primarily represents changes in asset balances for externally managed accounts.

Page 17

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

U.S. RETIREMENT SOLUTIONS AND INVESTMENT MANAGEMENT DIVISION - SUPPLEMENTARY REVENUE AND ASSETS UNDER MANAGEMENT INFORMATION FOR ASSET MANAGEMENT SEGMENT


				Supplementary Revenue Information (in millions):
Year-to-date			% Change		2009					2010
2010	2009		% Change		2Q	3Q		4Q		1Q	2Q

				Analysis of revenues by type:
615	493		25%	Asset management fees	254	269		287		304	311
90	(34	)	365%	Incentive, transaction, principal investing and commercial mortgage revenues	1	(13	)	(17	)	16	74
168	146		15%	Service, distribution and other revenues	87	35		91		59	109

873	605		44%	Total Asset Management segment revenues	342	291		361		379	494


				Analysis of asset management fees by source:
304	245		24%	Institutional customers	126	129		137		152	152
168	118		42%	Retail customers	62	71		79		81	87
143	130		10%	General account	66	69		71		71	72

615	493		25%	Total asset management fees	254	269		287		304	311



				Supplementary Assets Under Management Information (in billions):


	June 30, 2010
	Equity	Fixed Income	Real Estate	Total
Institutional customers	43.1	139.4	21.0	203.5
Retail customers	56.5	26.4	1.3	84.2
General account	3.5	192.2	0.9	196.6

Total	103.1	358.0	23.2	484.3


	June 30, 2009
	Equity	Fixed Income	Real Estate	Total
Institutional customers	40.1	101.7	21.7	163.5
Retail customers	45.2	23.4	1.7	70.3
General account	3.4	171.3	0.9	175.6

Total	88.7	296.4	24.3	409.4

Page 18

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

U.S. RETIREMENT SOLUTIONS AND INVESTMENT MANAGEMENT DIVISION - SUPPLEMENTARY ASSETS UNDER MANAGEMENT AND ADMINISTRATION INFORMATION FOR ASSET MANAGEMENT SEGMENT

(in billions)


Year-to-date					2009						2010
2010		2009			2Q		3Q		4Q		1Q		2Q

				Institutional Assets Under Management:

				Assets gathered by Investment Management & Advisory Services sales force:
151.7		128.5		Beginning assets under management	120.6		128.9		143.4		151.7		156.2
21.6		12.6		Additions	7.7		10.4		10.8		7.2		14.4
(10.0	)	(11.1	)	Withdrawals	(6.5	)	(5.6	)	(4.5	)	(5.7	)	(4.3	)
2.9		(0.1	)	Change in market value	7.2		9.9		2.1		3.6		(0.7	)
(0.6	)	(1.0	)	Net money market flows	(0.1	)	(0.2	)	(0.1	)	(0.6	)	—

165.6		128.9		Ending assets under management	128.9		143.4		151.7		156.2		165.6
37.9		34.6		Affiliated institutional assets under management	34.6		36.5		36.7		37.1		37.9

203.5		163.5		Total assets managed for institutional customers at end of period	163.5		179.9		188.4		193.3		203.5


11.6		1.5		Net institutional additions, excluding money market activity	1.2		4.8		6.3		1.5		10.1


				Retail Assets Under Management:

				Assets gathered by Investment Management & Advisory Services sales force:
51.1		33.4		Beginning assets under management	33.5		39.5		47.2		51.1		53.5
11.6		8.1		Additions	4.6		6.1		4.4		4.8		6.8
(7.6	)	(6.0	)	Withdrawals	(2.7	)	(3.3	)	(3.2	)	(3.7	)	(3.9	)
(3.4	)	3.7		Change in market value	4.4		5.1		2.9		1.5		(4.9	)
(2.6	)	0.3		Net money market flows	(0.3	)	(0.2	)	(0.2	)	(0.2	)	(2.4	)

49.1		39.5		Ending assets under management	39.5		47.2		51.1		53.5		49.1
35.1		30.8		Affiliated retail assets under management	30.8		31.9		33.3		35.5		35.1

84.2		70.3		Total assets managed for retail customers at end of period	70.3		79.1		84.4		89.0		84.2


4.0		2.1		Net retail additions, excluding money market activity	1.9		2.8		1.2		1.1		2.9

Page 19

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

COMBINED STATEMENTS OF OPERATIONS - U.S. INDIVIDUAL LIFE AND GROUP INSURANCE DIVISION

(in millions)


Year-to-date				%		2009						2010
2010		2009		Change		2Q		3Q		4Q		1Q		2Q

					Revenues (1):
2,362		2,346		1%	Premiums	1,156		1,226		1,165		1,172		1,190
781		805		-3%	Policy charges and fee income	412		297		407		375		406
764		703		9%	Net investment income	350		361		368		375		389
158		165		-4%	Asset management fees, commissions and other income	88		128		82		76		82

4,065		4,019		1%	Total revenues	2,006		2,012		2,022		1,998		2,067


					Benefits and Expenses (1):
2,631		2,498		5%	Insurance and annuity benefits	1,222		1,326		1,234		1,323		1,308
250		238		5%	Interest credited to policyholders’ account balances	119		126		128		126		124
72		98		-27%	Interest expense	47		42		41		35		37
(227	)	(261	)	13%	Deferral of acquisition costs	(136	)	(143	)	(133	)	(118	)	(109	)
216		210		3%	Amortization of acquisition costs	74		(98	)	96		60		156
859		860		0%	General and administrative expenses	437		452		446		428		431

3,801		3,643		4%	Total benefits and expenses	1,763		1,705		1,812		1,854		1,947


264		376		-30%	Adjusted operating income before income taxes	243		307		210		144		120

(1)	Revenues exclude realized investment gains, net of losses and related charges and adjustments. Benefits and expenses exclude charges related to realized investment gains, net of losses.

Page 20

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

COMBINING STATEMENTS OF OPERATIONS - U.S. INDIVIDUAL LIFE AND GROUP INSURANCE DIVISION

(in millions)


	Six Months Ended June 30, 2010						Quarter Ended June 30, 2010
	Total U.S. Individual Life & Group Insurance Division		Individual Life		Group Insurance		Total U.S. Individual Life & Group Insurance Division		Individual Life		Group Insurance
Revenues (1):
Premiums	2,362		353		2,009		1,190		177		1,013
Policy charges and fee income	781		543		238		406		294		112
Net investment income	764		436		328		389		223		166
Asset management fees, commissions and other income	158		106		52		82		57		25

Total revenues	4,065		1,438		2,627		2,067		751		1,316


Benefits and Expenses (1):
Insurance and annuity benefits	2,631		579		2,052		1,308		270		1,038
Interest credited to policyholders’ account balances	250		139		111		124		70		54
Interest expense	72		72		—		37		37		—
Deferral of acquisition costs	(227	)	(205	)	(22	)	(109	)	(98	)	(11	)
Amortization of acquisition costs	216		206		10		156		151		5
General and administrative expenses	859		468		391		431		233		198

Total benefits and expenses	3,801		1,259		2,542		1,947		663		1,284


Adjusted operating income before income taxes	264		179		85		120		88		32


	Six Months Ended June 30, 2009						Quarter Ended June 30, 2009
	Total U.S. Individual Life & Group Insurance Division		Individual Life		Group Insurance		Total U.S. Individual Life & Group Insurance Division		Individual Life		Group Insurance
Revenues (1):
Premiums	2,346		330		2,016		1,156		170		986
Policy charges and fee income	805		554		251		412		278		134
Net investment income	703		397		306		350		200		150
Asset management fees, commissions and other income	165		102		63		88		55		33

Total revenues	4,019		1,383		2,636		2,006		703		1,303


Benefits and Expenses (1):
Insurance and annuity benefits	2,498		522		1,976		1,222		250		972
Interest credited to policyholders’ account balances	238		127		111		119		65		54
Interest expense	98		98		—		47		47		—
Deferral of acquisition costs	(261	)	(243	)	(18	)	(136	)	(128	)	(8	)
Amortization of acquisition costs	210		197		13		74		69		5
General and administrative expenses	860		504		356		437		262		175

Total benefits and expenses	3,643		1,205		2,438		1,763		565		1,198


Adjusted operating income before income taxes	376		178		198		243		138		105

(1)	Revenues exclude realized investment gains, net of losses and related charges and adjustments. Benefits and expenses exclude charges related to realized investment gains, net of losses.

Page 21

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

U.S. INDIVIDUAL LIFE AND GROUP INSURANCE DIVISION - INDIVIDUAL LIFE ANNUALIZED NEW BUSINESS PREMIUMS, ACCOUNT VALUE ACTIVITY, AND FACE AMOUNT IN FORCE

(in millions)


Year-to-date					2009						2010
2010		2009			2Q		3Q		4Q		1Q		2Q

				ANNUALIZED NEW BUSINESS PREMIUMS (1):

10		9		Variable life	5		3		8		5		5
37		60		Universal life	32		26		27		20		17
82		113		Term life	61		57		56		43		39

129		182		Total	98		86		91		68		61


				ANNUALIZED NEW BUSINESS PREMIUMS BY DISTRIBUTION CHANNEL (1):

42		46		Prudential Agents	24		22		27		20		22
87		136		Third party distribution	74		64		64		48		39

129		182		Total	98		86		91		68		61


				ACCOUNT VALUE ACTIVITY:

				*Policyholders’ Account Balances (2):*
8,081		7,397		Beginning balance	7,691		7,824		7,914		8,081		8,228
751		1,044		Premiums and deposits	474		386		375		382		369
(389	)	(518	)	Surrenders and withdrawals	(240	)	(220	)	(196	)	(184	)	(205	)

362		526		Net sales	234		166		179		198		164
(104	)	(66	)	Benefit payments	(32	)	(50	)	(33	)	(64	)	(40	)

258		460		Net flows	202		116		146		134		124
19		17		Interest credited and other	(64	)	11		50		48		(29	)
132		130		Net transfers from separate account	85		53		63		58		74
(185	)	(180	)	Policy charges	(90	)	(90	)	(92	)	(93	)	(92	)

8,305		7,824		Ending balance	7,824		7,914		8,081		8,228		8,305


				*Separate Account Liabilities:*
15,692		12,848		Beginning balance	12,110		13,450		14,972		15,692		16,155
469		576		Premiums and deposits	261		268		329		235		234
(288	)	(544	)	Surrenders and withdrawals	(216	)	(139	)	(165	)	(142	)	(146	)

181		32		Net sales	45		129		164		93		88
(16	)	(20	)	Benefit payments	(18	)	(11	)	(8	)	(8	)	(8	)

165		12		Net flows	27		118		156		85		80
(518	)	1,074		Change in market value, interest credited and other	1,574		1,633		802		609		(1,127	)
(132	)	(130	)	Net transfers to general account	(85	)	(53	)	(63	)	(58	)	(74	)
(346	)	(354	)	Policy charges	(176	)	(176	)	(175	)	(173	)	(173	)

14,861		13,450		Ending balance	13,450		14,972		15,692		16,155		14,861


				FACE AMOUNT IN FORCE (3):

				Variable life	123,419		122,955		122,091		121,090		118,804
				Universal life	32,315		33,711		34,984		35,622		36,082
				Term life	402,459		417,100		431,831		440,915		447,408

				Total	558,193		573,766		588,906		597,627		602,294

(1)	Excludes corporate-owned life insurance.

(2)	Includes fixed rate funds, alliance deposits, supplementary contracts and deferred revenues on variable products.

(3)	At end of period; before reinsurance ceded.

Page 22

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

U.S. INDIVIDUAL LIFE AND GROUP INSURANCE DIVISION - SUPPLEMENTARY INFORMATION FOR INDIVIDUAL LIFE INSURANCE

(dollar amounts in millions)


Year-to-date			2009			2010
2010	2009		2Q	3Q	4Q	1Q	2Q

		Individual Life Insurance:

		Policy Surrender Experience:
342	493	Cash value of surrenders	236	173	190	170	172
3.1%	5.1%	Cash value of surrenders as a percentage of mean future policy benefits, policyholders’ account balances, and separate account balances	5.0%	3.4%	3.5%	3.0%	3.1%

		Death benefits per $1,000 of in force (1):
4.44	4.26	Variable and universal life	3.83	3.72	3.30	4.98	3.86
1.05	1.15	Term life	1.10	0.75	0.81	1.11	0.96
2.70	2.86	Total, Individual Life Insurance	2.54	2.32	1.98	2.98	2.38

(1)	Annualized, for interim reporting periods. Amounts are stated net of reinsurance.

Page 23

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

U.S. INDIVIDUAL LIFE AND GROUP INSURANCE DIVISION - SUPPLEMENTARY INFORMATION FOR GROUP INSURANCE

(dollar amounts in millions)


Year-to-date			2009						2010
2010	2009		2Q		3Q		4Q		1Q		2Q

		GROUP INSURANCE ANNUALIZED NEW BUSINESS PREMIUMS:
280	245	Group life	35		53		41		257		23
108	160	Group disability (1)	26		57		21		89		19

388	405	Total	61		110		62		346		42


		Future Policy Benefits (2):
		Group life	2,176		2,141		2,282		2,198		2,194
		Group disability (1)	1,059		1,132		1,176		1,276		1,321

		Total	3,235		3,273		3,458		3,474		3,515


		Policyholders’ Account Balances (2):
		Group life	6,160		6,343		6,506		6,560		6,688
		Group disability (1)	168		172		185		171		176

		Total	6,328		6,515		6,691		6,731		6,864


		Separate Account Liabilities (2):
		Group life	19,141		18,083		18,408		19,038		18,851
		Group disability (1)	—		—		—		—		—

		Total	19,141		18,083		18,408		19,038		18,851


		Group Life Insurance:
1,832	1,835	Gross premiums, policy charges and fee income (3)	915		889		877		936		896
1,694	1,706	Earned premiums, policy charges and fee income	849		873		835		841		853
91.9%	87.6%	Benefits ratio	87.3	%	89.8	%	88.6	%	91.7	%	92.2	%
9.0%	8.8%	Administrative operating expense ratio	8.7	%	9.1	%	9.4	%	8.8	%	9.3	%
		Persistency ratio	95.6	%	94.7	%	94.3	%	93.0	%	92.5	%

		Group Disability Insurance (1):
563	568	Gross premiums, policy charges and fee income (3)	271		303		274		285		278
553	561	Earned premiums, policy charges and fee income	271		291		269		281		272
89.7%	85.9%	Benefits ratio	85.6	%	93.5	%	90.3	%	86.5	%	93.0	%
22.4%	18.0%	Administrative operating expense ratio	18.1	%	17.5	%	20.1	%	21.4	%	23.4	%
		Persistency ratio	93.6	%	92.3	%	90.9	%	95.7	%	94.6	%

(1)	Group disability amounts include long-term care products.

(2)	As of end of period.

(3)	Before returns of premiums to participating policyholders for favorable claims experience.

Page 24

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

DEFERRED POLICY ACQUISITION COSTS & DEFERRED SALES INDUCEMENTS - INDIVIDUAL ANNUITIES, INDIVIDUAL LIFE AND GROUP INSURANCE

(in millions)


Year-to-date					2009						2010
2010		2009			2Q		3Q		4Q		1Q		2Q

				DEFERRED POLICY ACQUISITION COSTS

				INDIVIDUAL ANNUITIES:
2,449		2,329		Beginning balance	1,580		1,943		2,111		2,449		2,532
552		329		Capitalization	197		327		297		253		299
(734	)	(507	)	Amortization - operating results	355		(11	)	13		(137	)	(597	)
(4	)	13		Amortization - realized investment gains and losses	11		10		—		1		(5	)
(113	)	(221	)	Impact of unrealized (gains) or losses on AFS securities	(200	)	(158	)	28		(34	)	(79	)

2,150		1,943		Ending balance	1,943		2,111		2,449		2,532		2,150


				INDIVIDUAL LIFE INSURANCE:
4,179		4,226		Beginning balance	4,270		4,142		4,150		4,179		4,178
205		243		Capitalization	128		124		124		107		98
(206	)	(197	)	Amortization - operating results	(69	)	102		(91	)	(55	)	(151	)
—		—		Amortization - realized investment gains and losses	—		—		—		—		—
(146	)	(130	)	Impact of unrealized gains on AFS securities	(187	)	(218	)	(4	)	(53	)	(93	)

4,032		4,142		Ending balance	4,142		4,150		4,179		4,178		4,032


				GROUP INSURANCE:
371		347		Beginning balance	349		352		367		371		377
22		18		Capitalization	8		19		9		11		11
(10	)	(13	)	Amortization - operating results	(5	)	(4	)	(5	)	(5	)	(5	)
—		—		Amortization - realized investment gains and losses	—		—		—		—		—
—		—		Impact of unrealized losses on AFS securities	—		—		—		—		—

383		352		Ending balance	352		367		371		377		383


				DEFERRED SALES INDUCEMENTS

				INDIVIDUAL ANNUITIES:
1,117		1,023		Beginning balance	807		983		1,016		1,117		1,137
220		148		Capitalization	82		130		113		110		110
(350	)	(197	)	Amortization - operating results	84		(15	)	(9	)	(93	)	(257	)
—		9		Amortization - realized investment gains and losses	10		10		5		3		(3	)
(32	)	—		Impact of unrealized (gains) or losses on AFS securities	—		(92	)	(8	)	—		(32	)
—		—		Other	—		—		—		—		—

955		983		Ending balance	983		1,016		1,117		1,137		955

Page 25

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

COMBINED STATEMENTS OF OPERATIONS - INTERNATIONAL INSURANCE AND INVESTMENTS DIVISION

(in millions)


Year-to-date				% Change		2009						2010
2010		2009		% Change		2Q		3Q		4Q		1Q		2Q

					Revenues (1):
4,449		3,810		17%	Premiums	1,911		2,015		2,053		2,217		2,232
191		190		1%	Policy charges and fee income	91		90		94		95		96
1,161		1,035		12%	Net investment income	506		563		564		583		578
212		186		14%	Asset management fees, commissions and other income	101		74		93		99		113

6,013		5,221		15%	Total revenues	2,609		2,742		2,804		2,994		3,019


					Benefits and Expenses (1):
3,585		2,966		21%	Insurance and annuity benefits	1,465		1,572		1,601		1,770		1,815
264		229		15%	Interest credited to policyholders’ account balances	110		123		128		134		130
1		2		-50%	Interest expense	1		1		1		1		—
(666	)	(608	)	-10%	Deferral of acquisition costs	(299	)	(302	)	(338	)	(339	)	(327	)
428		416		3%	Amortization of acquisition costs	214		175		207		215		213
1,427		1,308		9%	General and administrative expenses	642		666		750		717		710

5,039		4,313		17%	Total benefits and expenses	2,133		2,235		2,349		2,498		2,541


974		908		7%	Adjusted operating income before income taxes	476		507		455		496		478

(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 include revenues representing equity in earnings of operating joint ventures. Benefits and expenses exclude charges related to realized investment gains, net of losses and change in experience-rated contractholder liabilities due to asset value changes and include charges for income attributable to non controlling interests.

Page 26

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

COMBINING STATEMENTS OF OPERATIONS - INTERNATIONAL INSURANCE AND INVESTMENTS DIVISION

(in millions)


	Six Months Ended June 30, 2010							Quarter Ended June 30, 2010
	Total International Insurance & Investments Division		International Insurance - Life Planner Operations		International Insurance - Gibraltar Life		International Investments	Total International Insurance & Investments Division		International Insurance - Life Planner Operations		International Insurance - Gibraltar Life		International Investments
Revenues (1):
Premiums	4,449		2,760		1,689		—	2,232		1,312		920		—
Policy charges and fee income	191		153		38		—	96		77		19		—
Net investment income	1,161		594		566		1	578		295		283		—
Asset management fees, commissions and other income	212		22		19		171	113		12		10		91

Total revenues	6,013		3,529		2,312		172	3,019		1,696		1,232		91


Benefits and Expenses (1):
Insurance and annuity benefits	3,585		2,233		1,352		—	1,815		1,070		745		—
Interest credited to policyholders’ account balances	264		100		164		—	130		47		83		—
Interest expense	1		1		—		—	—		—		—		—
Deferral of acquisition costs	(666	)	(438	)	(228	)	—	(327	)	(204	)	(123	)	—
Amortization of acquisition costs	428		283		145		—	213		137		76		—
General and administrative expenses	1,427		732		554		141	710		355		283		72

Total benefits and expenses	5,039		2,911		1,987		141	2,541		1,405		1,064		72


Adjusted operating income before income taxes	974		618		325		31	478		291		168		19


	Six Months Ended June 30, 2009							Quarter Ended June 30, 2009
	Total International Insurance & Investments Division		International Insurance - Life Planner Operations		International Insurance - Gibraltar Life		International Investments	Total International Insurance & Investments Division		International Insurance - Life Planner Operations		International Insurance - Gibraltar Life		International Investments
Revenues (1):
Premiums	3,810		2,484		1,326		—	1,911		1,199		712		—
Policy charges and fee income	190		150		40		—	91		72		19		—
Net investment income	1,035		505		527		3	506		251		255		—
Asset management fees, commissions and other income	186		42		(4	)	148	101		17		8		76

Total revenues	5,221		3,181		1,889		151	2,609		1,539		994		76


Benefits and Expenses (1):
Insurance and annuity benefits	2,966		1,918		1,048		—	1,465		900		565		—
Interest credited to policyholders’ account balances	229		88		141		—	110		40		70		—
Interest expense	2		2		—		—	1		(1	)	2		—
Deferral of acquisition costs	(608	)	(420	)	(188	)	—	(299	)	(201	)	(98	)	—
Amortization of acquisition costs	416		285		131		—	214		147		67		—
General and administrative expenses	1,308		699		476		133	642		339		238		65

Total benefits and expenses	4,313		2,572		1,608		133	2,133		1,224		844		65


Adjusted operating income before income taxes	908		609		281		18	476		315		150		11

(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 include revenues representing equity in earnings of operating joint ventures. Benefits and expenses exclude charges related to realized investment gains, net of losses and change in experience-rated contractholder liabilities due to asset value changes and include charges for income attributable to non controlling interests.

Page 27

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

INTERNATIONAL INSURANCE SEGMENT - SUPPLEMENTARY INCOME STATEMENT INFORMATION

(Yen and Dollars in millions)


Year-to-date					2009						2010
2010		2009			2Q		3Q		4Q		1Q		2Q

				Japanese Yen Basis Results:
				Revenues (1):
¥	246,486	¥	239,625	Japanese insurance operations excluding Gibraltar Life	¥	114,650	¥	114,616	¥	113,194	¥	129,732	¥	116,754
	215,511		184,090	Gibraltar Life		99,223		105,163		96,669		100,702		114,809

	461,997		423,715	Total revenues, Japan, yen basis		213,873		219,779		209,863		230,434		231,563


				Benefits and Expenses (1):
	197,595		189,616	Japanese insurance operations excluding Gibraltar Life		88,419		88,816		91,149		103,872		93,723
	180,802		153,124	Gibraltar Life		82,573		84,509		82,300		84,079		96,723

	378,397		342,740	Total benefits and expenses, Japan, yen basis		170,992		173,325		173,449		187,951		190,446


				Adjusted operating income (2):
	48,891		50,009	Japanese insurance operations excluding Gibraltar Life		26,231		25,800		22,045		25,860		23,031
	34,709		30,966	Gibraltar Life		16,650		20,654		14,369		16,623		18,086

¥	83,600	¥	80,975	Total adjusted operating income, Japan, yen basis	¥	42,881	¥	46,454	¥	36,414	¥	42,483	¥	41,117


				U.S. Dollar adjusted operating income (3):
$	510	$	494	Japanese insurance operations excluding Gibraltar Life	$	257	$	254	$	226	$	270	$	240
	325		281	Gibraltar Life		150		190		151		157		168

	835		775	Total adjusted operating income, Japan, U.S. dollar basis		407		444		377		427		408
	108		115	All other countries (4)		58		56		76		57		51

$	943	$	890	Total adjusted operating income, International Insurance segment, U.S. dollar basis	$	465	$	500	$	453	$	484	$	459

(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 include revenues representing equity in earnings of operating joint ventures. Benefits and expenses exclude charges related to realized investment gains, net of losses and change in experience-rated contractholder liabilities due to asset value changes and include charges for income attributable to non controlling interests.

(2)	Adjusted operating income on yen basis excludes impact of currency hedging.

(3)	U.S. dollar adjusted operating income includes impact of currency hedging.

(4)	Results include corporate management and development expenses incurred in the U.S. related to Japanese Insurance operations excluding Gibraltar Life.

Page 28

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

INTERNATIONAL INSURANCE AND INVESTMENTS DIVISION - SALES RESULTS AND SUPPLEMENTARY INFORMATION

(in millions)


Year-to-date			2009			2010
2010	2009		2Q	3Q	4Q	1Q	2Q

		INTERNATIONAL INSURANCE OPERATING DATA:

		Actual exchange rate basis (1):

		Net premiums, policy charges and fee income:
2,210	2,047	Japan, excluding Gibraltar Life	963	980	1,019	1,180	1,030
1,727	1,366	Gibraltar Life	731	802	771	788	939
703	587	All other countries	308	323	357	344	359

4,640	4,000	Total	2,002	2,105	2,147	2,312	2,328


		Annualized new business premiums:
321	295	Japan, excluding Gibraltar Life	122	138	144	184	137
384	260	Gibraltar Life	147	149	159	163	221
125	106	All other countries	59	67	83	64	61

830	661	Total	328	354	386	411	419


		Annualized new business premiums by distribution channel:
446	401	Life Planners	181	205	227	248	198
250	214	Gibraltar Life Advisors	122	111	111	107	143
134	46	Banks	25	38	48	56	78

830	661	Total	328	354	386	411	419


		Constant exchange rate basis (2):

		Net premiums, policy charges and fee income:
2,080	1,994	Japan, excluding Gibraltar Life	951	938	945	1,106	974
1,593	1,306	Gibraltar Life	721	771	703	720	873
757	718	All other countries	359	365	385	366	391

4,430	4,018	Total	2,031	2,074	2,033	2,192	2,238


		Annualized new business premiums:
305	289	Japan, excluding Gibraltar Life	120	132	135	174	131
367	257	Gibraltar Life	149	149	151	155	212
132	126	All other countries	66	76	89	67	65

804	672	Total	335	357	375	396	408


		Annualized new business premiums by distribution channel:
437	415	Life Planners	186	208	224	241	196
236	211	Gibraltar Life Advisors	124	110	104	100	136
131	46	Banks	25	39	47	55	76

804	672	Total	335	357	375	396	408

(1)	Translated based on applicable average exchange rates for the period shown.

(2)	Foreign denominated activity translated to U.S. dollars at uniform exchange rates for all periods presented, including Japanese yen 99 per U.S. dollar; Korean won 1040 per U.S. dollar. U.S. denominated activity is included based on the amounts as transacted in U.S. dollars.

Page 29

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

INTERNATIONAL INSURANCE AND INVESTMENTS DIVISION - SALES RESULTS AND SUPPLEMENTARY INFORMATION


	2009						2010
	2Q		3Q		4Q		1Q		2Q

Face amount of individual policies in force at end of period (in billions) (1)(2):
(Constant exchange rate basis)
Japan, excluding Gibraltar Life	267		269		270		273		274
Gibraltar Life	193		198		198		197		196
All other countries	103		104		106		106		107

Total	563		571		574		576		577


Number of individual policies in force at end of period (in thousands) (2):
Japan, excluding Gibraltar Life	2,373		2,400		2,425		2,462		2,484
Gibraltar Life	3,760		3,894		3,897		3,892		3,868
All other countries	1,375		1,402		1,434		1,450		1,465

Total	7,508		7,696		7,756		7,804		7,817


International life insurance policy persistency:
Excluding Gibraltar Life:
13 months	91.8	%	91.5	%	91.6	%	91.6	%	91.7	%
25 months	84.7	%	84.2	%	84.6	%	84.4	%	84.2	%

Gibraltar Life:
13 months	91.2	%	91.1	%	91.6	%	92.0	%	92.2	%
25 months	83.1	%	83.2	%	83.6	%	83.8	%	83.8	%

Number of Life Planners at end of period:
Japan	2,987		3,043		3,094		3,150		3,122
All other countries	3,388		3,441		3,515		3,499		3,483

Total life planners	6,375		6,484		6,609		6,649		6,605


Gibraltar Life Advisors	6,376		6,060		6,398		5,971		6,101

(1)	Foreign denominated activity translated to U.S. dollars at uniform exchange rates for all periods presented, including Japanese yen 99 per U.S. dollar; Korean won 1040 per U.S. dollar. U.S. denominated activity is included based on the amounts as transacted in U.S. dollars.

(2)	Direct business only; policy count includes annuities.

Page 30

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

INVESTMENT PORTFOLIO COMPOSITION

(in millions)


	June 30, 2010					December 31, 2009
		Closed	Financial Services				Closed	Financial Services
	Consolidated	Block	Businesses			Consolidated	Block	Businesses
	Portfolio	Business	Amount	% of Total		Portfolio	Business	Amount	% of Total
Fixed maturities:
Public, available for sale, at fair value	148,106	30,596	117,510	59.0	%	140,805	29,537	111,268	58.4	%
Public, held to maturity, at amortized cost	3,905	—	3,905	2.0	%	4,009	—	4,009	2.1	%
Private, available for sale, at fair value	35,318	14,087	21,231	10.7	%	32,418	12,994	19,424	10.2	%
Private, held to maturity, at amortized cost	1,118	—	1,118	0.5	%	1,111	—	1,111	0.6	%
Trading account assets supporting insurance liabilities, at fair value	16,733	—	16,733	8.4	%	16,020	—	16,020	8.4	%
Other trading account assets, at fair value	1,401	144	1,257	0.6	%	1,783	167	1,616	0.8	%
Equity securities, available for sale, at fair value	6,628	2,894	3,734	1.9	%	6,883	3,085	3,798	2.0	%
Commercial mortgage and other loans	29,749	8,350	21,399	10.7	%	29,644	8,363	21,281	11.2	%
Policy loans	10,321	5,406	4,915	2.5	%	10,146	5,418	4,728	2.5	%
Other long-term investments (1)	4,561	1,829	2,732	1.4	%	4,356	1,545	2,811	1.5	%
Short-term investments (2)	5,480	834	4,646	2.3	%	5,640	1,338	4,302	2.3	%

Subtotal (3)	263,320	64,140	199,180	100.0	%	252,815	62,447	190,368	100.0	%

Invested assets of other entities and operations (4)	10,297	—	10,297			7,737	—	7,737

Total investments	273,617	64,140	209,477			260,552	62,447	198,105

Fixed Maturities by Credit Quality (3):


	June 30, 2010						December 31, 2009
	Financial Services Businesses						Financial Services Businesses
	Amortized Cost	Gross Unrealized Gains	Gross Unrealized Losses	Fair Value	% of Total		Amortized Cost	Gross Unrealized Gains	Gross Unrealized Losses	Fair Value	% of Total
Public Fixed Maturities:

NAIC Rating (5)
1	97,766	6,487	1,191	103,062	84.8	%	94,368	3,767	1,845	96,290	83.5	%
2	14,326	993	587	14,732	12.1	%	14,682	699	790	14,591	12.7	%

Subtotal - High or Highest Quality Securities (6)	112,092	7,480	1,778	117,794	96.9	%	109,050	4,466	2,635	110,881	96.2	%

3	2,475	42	295	2,222	1.8	%	2,743	44	314	2,473	2.1	%
4	1,422	18	337	1,103	0.9	%	1,657	22	345	1,334	1.2	%
5	545	24	195	374	0.3	%	685	19	202	502	0.4	%
6	109	16	46	79	0.1	%	197	25	69	153	0.1	%

Subtotal - Other Securities	4,551	100	873	3,778	3.1	%	5,282	110	930	4,462	3.8	%

Total	116,643	7,580	2,651	121,572	100.0	%	114,332	4,576	3,565	115,343	100.0	%


Private Fixed Maturities:
NAIC Rating (5)
1	5,877	502	98	6,281	28.1	%	5,795	259	121	5,933	28.9	%
2	11,650	883	307	12,226	54.6	%	10,485	452	379	10,558	51.4	%

Subtotal - High or Highest Quality Securities (6)	17,527	1,385	405	18,507	82.7	%	16,280	711	500	16,491	80.3	%

3	2,145	80	86	2,139	9.6	%	2,292	52	131	2,213	10.8	%
4	1,121	15	101	1,035	4.6	%	1,193	18	118	1,093	5.3	%
5	445	8	24	429	1.9	%	482	6	36	452	2.2	%
6	250	31	13	268	1.2	%	313	24	39	298	1.4	%

Subtotal - Other Securities	3,961	134	224	3,871	17.3	%	4,280	100	324	4,056	19.7	%

Total	21,488	1,519	629	22,378	100.0	%	20,560	811	824	20,547	100.0	%

(1)	Other long-term investments consist of real estate and non-real estate related investments in joint ventures and partnerships, investment real estate held through direct ownership, and other miscellaneous investments.

(2)	Short-term investments have virtually no sub-prime exposure.

(3)	Excludes (i) assets of our securities brokerage, trading, banking operations and real estate and relocation services, (ii) assets of our asset management operations, including assets managed for third parties, and (iii) those assets classified as “separate account assets” on our balance sheet.

(4)	Includes invested assets of brokerage, trading, banking operations, real estate and relocation services, and asset management operations. Excludes assets of our asset management operations managed for third parties and those assets classified as “separate account assets” on our balance sheet.

(5)

Reflects equivalent ratings for investments of the international insurance operations. Includes, as of June 30, 2010 and December 31, 2009, respectively, 154 securities with amortized cost of $1,193 million (fair value $1,236 million) and 157 securities with amortized cost of $1,294 million (fair value, $1,299 million) that have been categorized based on expected NAIC designations pending receipt of SVO ratings.

(6)	As a result of the NAIC rating methodology for non-agency residential mortgage-backed securities, may include certain securities rated BB and below by external rating agencies as of March 31, 2010 and December 31, 2009.

Page 31

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

FINANCIAL SERVICES BUSINESSES INVESTMENT PORTFOLIO COMPOSITION

(in millions)


	June 30, 2010			December 31, 2009
	Amount	% of Total		Amount	% of Total
Japanese Insurance Operations:
Fixed maturities:
Public, available for sale, at fair value	53,469	73.8	%	50,476	73.0	%
Public, held to maturity, at amortized cost	3,905	5.4	%	4,009	5.8	%
Private, available for sale, at fair value	3,027	4.2	%	2,692	3.9	%
Private, held to maturity, at amortized cost	1,118	1.5	%	1,111	1.6	%
Trading account assets supporting insurance liabilities, at fair value	1,280	1.8	%	1,236	1.8	%
Other trading account assets, at fair value	712	1.0	%	804	1.2	%
Equity securities, available for sale, at fair value	1,482	2.0	%	1,508	2.2	%
Commercial mortgage and other loans	3,756	5.2	%	3,675	5.3	%
Policy loans	1,867	2.6	%	1,760	2.5	%
Other long-term investments (1)	1,467	2.0	%	1,524	2.2	%
Short-term investments	377	0.5	%	313	0.5	%

Total	72,460	100.0	%	69,108	100.0	%


	June 30, 2010			December 31, 2009
	Amount	% of Total		Amount	% of Total
Financial Services Businesses excluding Japanese Insurance Operations (2):
Fixed maturities:
Public, available for sale, at fair value	64,041	50.5	%	60,792	50.1	%
Public, held to maturity, at amortized cost	—	0.0	%	—	0.0	%
Private, available for sale, at fair value	18,204	14.4	%	16,732	13.8	%
Private, held to maturity, at amortized cost	—	0.0	%	—	0.0	%
Trading account assets supporting insurance liabilities, at fair value	15,453	12.2	%	14,784	12.2	%
Other trading account assets, at fair value	545	0.4	%	812	0.7	%
Equity securities, available for sale, at fair value	2,252	1.8	%	2,290	1.9	%
Commercial mortgage and other loans	17,643	13.9	%	17,606	14.5	%
Policy loans	3,048	2.4	%	2,968	2.4	%
Other long-term investments (1)	1,265	1.0	%	1,287	1.1	%
Short-term investments	4,269	3.4	%	3,989	3.3	%

Total	126,720	100.0	%	121,260	100.0	%

(1)	Other long-term investments consist of real estate and non-real estate related investments in joint ventures and partnerships, investment real estate held through direct ownership, derivatives and other miscellaneous investments.

(2)	Excludes assets classified as “Separate account assets” on our balance sheet.

Page 32

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

FINANCIAL SERVICES BUSINESSES INVESTMENT RESULTS

(in millions)


	Quarter Ended June 30
	2010						2009
	Investment Income				Realized Gains / (Losses)		Investment Income				Realized Gains / (Losses)
	Yield (3)		Amount		Realized Gains / (Losses)		Yield (3)		Amount		Realized Gains / (Losses)
Financial Services Businesses (1):
Fixed maturities	4.29	%	1,457		(96	)	4.49	%	1,398		(309	)
Equity securities	6.71	%	56		10		6.30	%	56		(114	)
Commercial loans	5.61	%	232		10		5.63	%	241		(88	)
Policy loans	4.77	%	57		—		5.11	%	55		—
Short-term investments and cash equivalents	0.31	%	9		—		0.46	%	14		—
Other investments	3.94	%	40		1,382		2.92	%	33		(798	)

Gross investment income before investment expenses	4.20	%	1,851		1,306		4.33	%	1,797		(1,309	)
Investment expenses	-0.14	%	(50	)	—		-0.15	%	(49	)	—

Subtotal	4.06	%	1,801		1,306		4.18	%	1,748		(1,309	)

Investment results of other entities and operations (2)			307		59				305		(105	)
Less, investment income related to adjusted operating income reconciling items			3						(4	)

Total			2,111		1,365				2,049		(1,414	)


	Six Months Ended June 30
	2010						2009
	Investment Income				Realized Gains / (Losses)		Investment Income				Realized Gains / (Losses)
	Yield (3)		Amount		Realized Gains / (Losses)		Yield (3)		Amount		Realized Gains / (Losses)
Financial Services Businesses (1):
Fixed maturities	4.31	%	2,894		(334	)	4.58	%	2,843		(545	)
Equity securities	6.55	%	109		—		6.00	%	113		(379	)
Commercial mortgage and other loans	5.62	%	462		28		5.67	%	483		(137	)
Policy loans	4.80	%	114		—		5.06	%	108		—
Short-term investments and cash equivalents	0.27	%	17		—		0.71	%	43		—
Other investments	3.86	%	80		1,745		3.68	%	78		377

Gross investment income before investment expenses	4.24	%	3,676		1,439		4.44	%	3,668		(684	)
Investment expenses	-0.14	%	(100	)	—		-0.16	%	(103	)	—

Subtotal	4.10	%	3,576		1,439		4.28	%	3,565		(684	)

Investment results of other entities and operations (2)			606		41				550		(157	)
Less, investment income related to adjusted operating income reconciling items			4						(8	)

Total			4,186		1,480				4,107		(841	)

(1)

Excludes assets of our securities brokerage, securities trading, and banking operations, real estate and relocation services, commercial loans and trading account assets supporting insurance liabilities where the investment results generally accrue to contractholders, assets of our asset management operations, including assets managed for third parties, and those assets classified as “separate account assets” on our balance sheet.

(2)

Includes investment income of securities brokerage, securities trading, banking operations, real estate and relocation services, asset management operations, commercial loans, and trading account assets supporting insurance liabilities where the investment results generally accrue to contractholders.

(3)

Yields are annualized, for interim periods, and are based on quarterly average carrying values except for fixed maturities, equity securities and securities lending activity. Yields for fixed maturities are based on amortized cost. Yields for equity securities are based on cost. Yields for fixed maturities and short term investments and cash equivalents are calculated net of liabilities and rebate expenses corresponding to securities lending activity. Yields exclude investment income and assets related to commercial loans and trading account assets supporting insurance liabilities where the investment results generally accrue to contractholders and investment income on assets other than those included in invested assets. Prior period’s yields are presented on a basis consistent with the current presentation.

Page 33

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

FINANCIAL SERVICES BUSINESSES INVESTMENT RESULTS - JAPANESE INSURANCE OPERATIONS

(in millions)


	Quarter Ended June 30
	2010						2009
	Investment Income				Realized Gains / (Losses)		Investment Income				Realized Gains / (Losses)
	Yield (1)		Amount		Realized Gains / (Losses)		Yield (1)		Amount		Realized Gains / (Losses)
Japanese Insurance Operations:
Fixed maturities	2.80	%	418		(114	)	2.83	%	357		(82	)
Equity securities	2.85	%	10		(1	)	2.47	%	11		(104	)
Commercial loans	4.61	%	42		7		4.80	%	41		(9	)
Policy loans	3.73	%	17		—		3.78	%	14		—
Short-term investments and cash equivalents	0.32	%	1		—		0.13	%	1		—
Other investments	3.07	%	17		197		6.28	%	31		(144	)

Gross investment income before investment expenses	2.88	%	505		89		2.97	%	455		(339	)
Investment expenses	-0.16	%	(28	)	—		-0.15	%	(22	)	—

Total	2.72	%	477		89		2.82	%	433		(339	)


	Six Months Ended June 30
	2010						2009
	Investment Income				Realized Gains / (Losses)		Investment Income				Realized Gains / (Losses)
	Yield (1)		Amount		Realized Gains / (Losses)		Yield (1)		Amount		Realized Gains / (Losses)
Japanese Insurance Operations:
Fixed maturities	2.78	%	823		(336	)	2.89	%	725		(97	)
Equity securities	2.80	%	21		(61	)	2.82	%	29		(278	)
Commercial mortgage and other loans	4.60	%	84		8		4.84	%	82		(7	)
Policy loans	3.74	%	33		—		3.84	%	29		—
Short-term investments and cash equivalents	0.31	%	2		—		0.55	%	5		—
Other investments	4.35	%	49		221		6.32	%	68		(365	)

Gross investment income before investment expenses	2.90	%	1,012		(168	)	3.07	%	938		(747	)
Investment expenses	-0.15	%	(54	)	—		-0.17	%	(51	)	—

Total	2.75	%	958		(168	)	2.90	%	887		(747	)

(1)

Page 34

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

FINANCIAL SERVICES BUSINESSES INVESTMENT RESULTS - EXCLUDING JAPANESE INSURANCE OPERATIONS

(in millions)


	Quarter Ended June 30
	2010					2009
	Investment Income				Realized Gains / (Losses)	Investment Income				Realized Gains / (Losses)
	Yield (2)		Amount		Realized Gains / (Losses)	Yield (2)		Amount		Realized Gains / (Losses)
Financial Services Businesses excluding Japanese Insurance Operations (1):
Fixed maturities	5.44	%	1,039		18	5.63	%	1,041		(227	)
Equity securities	9.89	%	46		11	10.49	%	45		(10	)
Commercial loans	5.89	%	190		3	5.84	%	200		(79	)
Policy loans	5.39	%	40		—	5.86	%	41		—
Short-term investments and cash equivalents	0.30	%	8		—	0.53	%	13		—
Other investments	5.02	%	23		1,185	0.45	%	2		(654	)

Gross investment income before investment expenses	5.08	%	1,346		1,217	5.15	%	1,342		(970	)
Investment expenses	-0.13	%	(22	)	—	-0.15	%	(27	)	—

Total	4.95	%	1,324		1,217	5.00	%	1,315		(970	)


	Six Months Ended June 30
	2010					2009
	Investment Income				Realized Gains / (Losses)	Investment Income				Realized Gains / (Losses)
	Yield (2)		Amount		Realized Gains / (Losses)	Yield (2)		Amount		Realized Gains / (Losses)
Financial Services Businesses excluding Japanese Insurance Operations (1):
Fixed maturities	5.50	%	2,071		2	5.72	%	2,118		(448	)
Equity securities	9.75	%	88		61	9.85	%	84		(101	)
Commercial mortgage and other loans	5.92	%	378		20	5.87	%	401		(130	)
Policy loans	5.43	%	81		—	5.75	%	79		—
Short-term investments and cash equivalents	0.27	%	15		—	0.74	%	38		—
Other investments	3.28	%	31		1,524	1.01	%	10		742

Gross investment income before investment expenses	5.06	%	2,664		1,607	5.28	%	2,730		63
Investment expenses	-0.13	%	(46	)	—	-0.15	%	(52	)	—

Total	4.93	%	2,618		1,607	5.13	%	2,678		63

(1)

(2)

Page 35

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

KEY DEFINITIONS AND FORMULAS

1. Adjusted operating income before income taxes:

Adjusted operating income is a non-GAAP measure of performance of our Financial Services Businesses that excludes “Realized investment gains (losses), net”, as adjusted, and related charges and adjustments; net investment gains and losses on trading account assets supporting insurance liabilities; change in experience-rated contractholder liabilities due to asset value changes; results of divested businesses and discontinued operations; earnings attributable to noncontrolling interests; and the related tax effects thereof. Adjusted operating income includes equity in earnings of operating joint ventures and the related tax effects thereof. Revenues and benefits and expenses shown as components of adjusted operating income, are presented on the same basis as pre-tax adjusted operating income and are adjusted for the items above as well.

Realized investment gains (losses) within certain of our businesses for which such gains (losses) are a principal source of earnings, 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 excludes gains and losses from changes in value of certain assets and liabilities relating to foreign currency exchange movements that have been economically hedged, as well as gains and losses on certain investments that are classified as other trading account assets and debt that is carried at fair value.

Adjusted operating income does not equate to “Income from continuing operations” as determined in accordance with GAAP but is the measure of profit or loss we use to evaluate segment performance. Adjusted operating income is not a substitute for income determined in accordance with GAAP, and our definition of adjusted operating income may differ from that used by other companies. The items above are important to an understanding of our overall results of operations. However, we believe that the presentation of adjusted operating income as we measure it for management purposes enhances the understanding of our results of operations by highlighting the results from ongoing operations and the underlying profitability factors of our businesses.

2. After-tax adjusted operating income:

Adjusted operating income before taxes, as defined above, less the income tax effect applicable to adjusted operating income before taxes.

3. Annualized New Business Premiums:

Premiums from new sales that are expected to be collected over a one year period. Group insurance annualized new business premiums exclude new premiums resulting from rate changes on existing policies, from additional coverage issued under our Servicemembers’ Group Life Insurance contract, and from excess premiums on group universal life insurance that build cash value but do not purchase face amounts. Group insurance annualized new business premiums include premiums from the takeover of claim liabilities. Group disability amounts include long-term care products. Excess (unscheduled) and single premium business for the company’s domestic individual life and international insurance operations are included in annualized new business premiums based on a 10% credit.

4. Assets Under Management:

Fair market value or account value of assets which Prudential manages directly in proprietary products, such as mutual funds and variable annuities, in separate accounts, wrap-fee products and the general account, and assets invested in investment options included in the Company’s products that are managed by third party sub-managers (i.e., the non-proprietary investment options in the Company’s products).

5. Attributed Equity:

Amount of capital assigned to each of the Company’s segments for purposes of measuring segment adjusted operating income before income taxes, established at a level which management considers necessary to support the segment’s risks. Attributed equity for the Financial Services Businesses represents all of the Company’s equity that is not included in the Closed Block Business or attributable to noncontrolling interests.

6. Book value per share of Common Stock:

Equity attributed to Financial Services Businesses divided by the number of Common shares outstanding at end of period, on a diluted basis.

7. Borrowings - Capital Debt:

Borrowings that are or will be used for capital requirements at Prudential Financial, Inc as well as borrowings invested in equity or debt securities of direct or indirect subsidiaries of Prudential Financial, Inc., and subsidiary borrowings, utilized for capital requirements.

8. Borrowings - Investment Related:

Debt issued to finance specific investment assets or portfolios of investment assets, including institutional spread lending investment portfolios, real estate, and real estate related investments held in consolidated joint ventures, as well as institutional and insurance company portfolio cash flow timing differences.

9. Borrowings - Securities Business Related:

Debt issued to finance primarily the liquidity of our broker-dealers, and our capital markets and other securities business related operations including our discontinued commercial mortgage conduit related activities.

10. Borrowings - Specified Other Businesses:

Borrowings associated with consumer banking activities, the individual annuity business, real estate franchises, and relocation services.

Page 36

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

KEY DEFINITIONS AND FORMULAS

11. Client Assets:

Fair market value of assets in client accounts of International brokerage operations, Prudential Bank and mortgage loan servicing business, that are not included in Assets Under Management. Prudential does not receive a management or administrative fee on these assets, but may receive a fee for executing trades, custody or recordkeeping services.

12. Earned Premiums:

The portion of a premium, net of any amount ceded, that represents coverage already provided or that belongs to the insurer based on the part of the policy period that has passed.

13. Earnings Per Share of Common Stock:

Net income (loss) for the Financial Services Businesses and the Closed Block Business is determined in accordance with GAAP and includes general and administrative expenses charged to each of the businesses based on the Company's methodology for the allocation of such expenses. Cash flows between the Financial Services Businesses and the Closed Block Business related to administrative expenses are determined by a policy servicing fee arrangement that is based upon insurance and policies in force and statutory cash premiums. To the extent reported administrative expenses vary from these cash flow amounts, the differences are recorded, on an after-tax basis, as direct equity adjustments to the equity balances of each business. The direct equity adjustments modify earnings available to holders of Common Stock and Class B Stock for earnings per share purposes. Earnings per share of Common Stock based on adjusted operating income (loss) of the Financial Services Businesses reflects these adjustments as well.

14. Full Service:

The Full Service line of business provides retirement plan products and services to public, private and not-for-profit organizations. This business provides recordkeeping, plan administration, actuarial advisory services, participant education and communication services, trustee services and institutional and retail investment funds. This business mainly services defined contribution and defined benefit plans; non-qualified plans are also serviced. For clients with both defined contribution and defined benefit plans, integrated recordkeeping services are available. For participants leaving these plans, a range of rollover products are provided through a broker-dealer bank.

15. Full Service Stable Value:

Our Full Service Stable Value products represent fixed rate options on investment funds offered to customers. These products contain an obligation to pay interest at a specified rate for a specific period of time. Upon termination these products repay account balances at market value immediately or may be liquidated at book value over time. Substantially all of these products are either fully or partially participating, with annual or semi-annual resets giving effect to previous investment experience. These products are issued through the general account, separate accounts or client-owned trusts. Profits from partially participating general account products result from the spread between the rate of return on investment assets and the interest rates credited to the customer, less expenses. For fully participating products, generally subject to a minimum interest rate guarantee, we earn fee income.

16. General Account:

Invested assets and policyholder liabilities and reserves for which the Company bears the investment risk. Excludes assets recognized for statutory purposes that are specifically allocated to a separate account. General account assets also include assets of the parent company, Prudential Financial, Inc.

17. Gibraltar Life Advisors:

Insurance representatives for Gibraltar Life.

18. Group Life Insurance and Group Disability Insurance Administrative Operating Expense Ratios:

Ratio of administrative operating expenses (excluding commissions) to gross premiums, policy charges and fee income.

19. Group Life Insurance and Group Disability Insurance Benefits Ratios:

Ratio of policyholder benefits to earned premiums, policy charges and fee income.

20. Individual Annuity Account Values in General Account and Separate Account:

Amounts represent the breakdown of invested customer funds in annuities either written or reinsured by the Company.

21. Individual Annuities - Net Amounts at Risk:

Living Benefit Features - For guarantees of benefits that are payable at annuitization, the net amount at risk is generally defined as the present value of the minimum guaranteed annuity payments available to the contractholder determined in accordance with the terms of the contract in excess of the current account balance. For guarantees of benefits that are payable at withdrawal, the net amount at risk is generally defined as the present value of the minimum guaranteed withdrawal payments available to the contractholder determined in accordance with the terms of the contract in excess of the current account balance. For guarantees of accumulation balances, the net amount at risk is generally defined as the guaranteed minimum accumulation balance minus the current account balance.

Death Benefit Features - Net amount at risk is generally defined as the current guaranteed minimum death benefit in excess of the current account balance at the balance sheet date.

Page 37

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

KEY DEFINITIONS AND FORMULAS

22. Insurance and Annuity Benefits:

Total death benefits, annuity benefits, disability benefits, other policy benefits, and losses paid or incurred, under insurance and annuity contracts, plus the change in reserves for future policy benefits, losses and loss adjustment expenses.

23. International Life Planners:

Insurance agents in our insurance operations outside the United States, excluding Gibraltar Life Advisors. Excludes Life Planners associated with discontinued Philippine operations.

24. Non-recourse and Limited-recourse Debt:

Limited and non-recourse borrowing is where the holder is entitled to collect only against the assets pledged to the debt as collateral or has only very limited rights to collect against other assets.

25. Operating return on average equity (based on adjusted operating income):

Adjusted operating income after-tax (giving effect to the direct equity adjustment for earnings per share calculation), annualized for interim periods, divided by average attributed equity for the Financial Services Businesses excluding accumulated other comprehensive income related to unrealized gains and losses on investments and pension/postretirement benefits.

An alternative measure to operating return on average equity (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 attributable to Prudential Financial, Inc. 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 10.42% for the six months ended June 30, 2010, 6.71% for the six months ended June 30, 2009, 11.98% for the three months ended June 30, 2010, 8.79% for the three months ended March 31, 2010, 31.43% for the three months ended December 31, 2009, 21.03% for the three months ended September 30, 2009 and 12.76% for the three months ended June 30, 2009.

26. Policy Persistency - Group Insurance:

Percentage of the premiums in force at the end of the prior year that are still in force at the end of the period (excluding Servicemembers’ Group Life Insurance and Prudential Employee Benefit Plan).

27. Policy Persistency - International Insurance:

13 month persistency represents the percentage of policies issued that are still in force at the beginning of their second policy year. 25 month persistency represents the percentage of policies issued that are still in force at the beginning of their third policy year.

28. Prudential Agents:

Insurance agents in our insurance operations in the United States.

29. Prudential Agent productivity:

Commissions on new sales of all products by Prudential Agents under contract for the entire period, divided by the number of those Prudential Agents. Excludes commissions on new sales by Prudential Agents hired or departed during the period. For interim reporting periods, the productivity measures are annualized.

30. Ratio of capital debt to total capitalization:

For the purposes of this ratio, we measure “debt” as the sum of senior debt supporting capital needs and 75% of Junior Subordinated Notes supporting capital needs, (effective June 30, 2010; for periods prior to June 30, 2010, 25% of Junior Subordinated Notes are considered debt) and, for all periods, we measure “total capitalization” as the sum of senior debt supporting capital needs, 100% of Junior Subordinated Notes supporting capital needs, and attributed equity of the Financial Services Businesses excluding accumulated other comprehensive income related to unrealized gains and losses on investments and pension / postretirement benefits.

31. Separate Accounts:

Assets of our insurance companies allocated under certain policies and contracts that are segregated from the general account and other separate accounts. The policyholder or contractholder predominantly bears the risk of investments held in a separate account.

32. Wrap-Fee Products:

Investment products generating asset-based fees in which the funds of the customer are generally invested in other investment products such as mutual funds.

Page 38

Prudential Financial, Inc.

Quarterly Financial Supplement

Second Quarter 2010

RATINGS AND INVESTOR INFORMATION

FINANCIAL STRENGTH RATINGS

as of August 4, 2010


	A.M. Best	Standard & Poor’s	Moody’s	Fitch Ratings
The Prudential Insurance Company of America	A+	AA-	A2	A+
PRUCO Life Insurance Company	A+	AA-	A2	A+
PRUCO Life Insurance Company of New Jersey	A+	AA-	NR*	A+
Prudential Annuities Life Assurance Corporation	A+	AA-	NR	A+
Prudential Retirement Insurance and Annuity Company	A+	AA-	A2	A+
The Prudential Life Insurance Co., Ltd. (Prudential of Japan)	NR	AA-	NR	NR
Gibraltar Life Insurance Company, Ltd.	NR	AA-	A2	NR

CREDIT RATINGS:
as of August 4, 2010

Prudential Financial, Inc.:
Short-Term Borrowings	AMB-1	A-1	P-2	F2
Long-Term Senior Debt (1)	a-	A	Baa2	BBB
Junior Subordinated Long-Term Debt	bbb	BBB+	Baa3	BB+

The Prudential Insurance Company of America :
Capital and surplus notes	a	A	Baa1	A-

Prudential Funding, LLC:
Short-Term Debt	AMB-1	A-1+	P-2	F1
Long-Term Senior Debt	a+	AA-	A3	A

PRICOA Global Funding I
Long-Term Senior Debt	aa-	AA-	A2	A+

*	NR indicates not rated.

(1)	Includes the retail medium-term notes program.

INVESTOR INFORMATION:


Corporate Offices:		Investor Information Hotline:

Prudential Financial, Inc.		Dial 877-998-ROCK for additional printed information or inquiries.
751 Broad Street
Newark, New Jersey 07102		Web Site:
		www.prudential.com

Common Stock:

Common Stock of Prudential Financial, Inc. is traded on the New York Stock Exchange under the symbol PRU.

Page 39

PRUDENTIAL FINANCIAL INC - FORM 8-K - EX-99.1 - QUARTERLY FINANCIAL SUPPLEMENT - August 4, 2010

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