2. Forward-Looking Statements
This presentation contains “forward-looking statements” within the meaning of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as “expects,”
“anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “will,” or words of similar meaning and
include, but are not limited to, statements regarding the outlook for the company’s future business and
financial performance. Forward-looking statements are based on management’s current expectations and
assumptions, which are subject to inherent uncertainties, risks and changes in circumstances that are
difficult to predict. Actual outcomes and results may differ materially due to global political, economic,
business, competitive, market, regulatory and other factors, including those discussed in the Appendix and
in the risk factors section of the company’s Form 10-K filed with the SEC on February 28, 2007, the
company’s Form 8-K filed with the SEC on April 16, 2007 and the company’s Form 10-Q filed with the SEC on
October 26, 2007. The company undertakes no obligation to publicly update any forward-looking statement,
whether as a result of new information, future developments or otherwise.
Non-GAAP and Selected Operating Performance Measures
All references to EPS, income, and ROE refer to net operating earnings per diluted share, net operating
income and operating return on equity. All references to ROE in the business segments are levered,
assuming 25% debt to total capital at the product line level.
All financial data as of 12/31/07 unless otherwise noted. For additional information, please see Genworth’s
Fourth Quarter of 2007 earnings release and financial supplement, as well investor materials dated
February 8, 2008 regarding Genworth’s U.S. Mortgage Insurance business, posted at www.genworth.com.
For important information regarding the use of non-GAAP measures and selected operating performance
measures, see the Appendix.
This presentation should be used in conjunction with the accompanying audio or call transcript.
Raymond James Conference – March 5, 2008 1
3. 2007 Performance
Operating EPS Operating ROE
$3.07
13 - 14%
Retirement &
Retirement & 11.0%
Protection
Protection 9.5%
50%
50%
International
39%
20041 2010 – 2011
2007
Target
U.S. Mortgage Ins.
11%
2007 1 Pro Forma - See Genworth’s Q4 2005 Earnings Release (Dated 1/26/06) For
Percentages Exclude Corporate And Other Reconciliation. Adjusted For Earnings From Discontinued Operations Of $36MM
Raymond James Conference – March 5, 2008 2
4. Genworth Strategy
Your Financial Security Company
Homeownership Life Security
Mortgage Protection
Insurance
Delivering
Wellness &
Care
Services
Financial
25 40
Age
55
Retirement Wealth
70
Security
Security Management
Accumulation
Income
LTC Managed
Accounts
Liquidity
Raymond James Conference – March 5, 2008 3
5. Positioning For The Future
Operating Income Mix Driving Growth/ROE Expansion
New Business
2005-2007
ROE
Sales CAGR
Int’l MI 34% High Teens
Int’l PPI 23% High Teens
Fee Based 84% High Teens
~85%+
New Life 33% Low Teens
New LTC 17% Mid Teens
Growth ~80% ~90%
Engines Opportunistic Spread (13%) Low Teens
U.S. MI 61% Mid Teens
Repositioning Old Life/Spread Extract Capital
Redeployment
Old LTC Improve ROE/Extract Capital
2007 2008E 2010/11E
Fee Based Includes Fee Based Retirement Income & Managed Money. Spread Includes Spread Based Retirement Income & Institutional
Raymond James Conference – March 5, 2008 4
6. Today’s Updates
Priority Growth Opportunities
– International
– Fee Based Wealth Management & Retirement
U.S. Mortgage Insurance
Investment Portfolio
Capital Optimization & Deployment
Raymond James Conference – March 5, 2008 5
7. Strong International Platform
Operating Income
~50% GNW
($MM)
Op Income
Retirement
25+ Countries
Products
600+ Distribution Relationships
585
1,900+ Associates
PPI
Global Risk Management
Canada
Double Digit Growth
Australia
Europe
& Other 2007 2010-2011E
22% 2007 Operating ROE
$3.4B Mortgage Insurance Unearned Premium Reserve (12/31/2007)
Raymond James Conference – March 5, 2008 6
8. Payment Protection Overview
Coverage
2007 Sales By Obligation
Mix
Sickness/Accident ~50%
Personal Life ~25%
52%
Loan
Unemployment ~25%
3 - 5 Year Average Life
Mortgage
16%
Auto
13%
Credit Card
11%
8% Other
Protected By:
200+ Financial Institutions Globally – Waiting & Exclusion Periods
Distributor Branded – Capitated Claim Payment Period
– Maximum Limits
Direct or Reinsurance
Raymond James Conference – March 5, 2008 7
9. Payment Protection Opportunity
Sales By Region Established Markets
($B)
2.8 Penetrate Significant Customer Base
New Products & Customers
Lender Structured Transactions
Continental
1.4
Europe
New Markets
.7
U.K. & Ireland
Transfer Product/Risk Expertise
.2
New Markets
Leverage Global Client Base
.5
Structured
Mexico, Poland, South Korea, Others
2007
Raymond James Conference – March 5, 2008 8
10. Global Mortgage Insurance Environment
Demand Drivers: Homeownership Initiatives, Capital Regulation,
Economic Environment
Economies Generally Healthy
Slowing Global Housing Finance & Appreciation Trends
– Most Pronounced in Spain, Ireland & U.K.
Some Liquidity Impact On Global Housing Finance
Significant Structural Differences vs. U.S.
New Markets Develop Gradually
Raymond James Conference – March 5, 2008 9
11. Comparing Mortgage Markets
Risk Management U.S. Canada Australia Europe
Credit Scoring
External Yes Yes No U.K. Only
Internal Yes Yes Yes U.K. Only
Borrower Underwriting Yes Yes Yes Yes
Property Appraisals Yes Yes Yes Yes
Sub-Prime Products ~20% Limited Limited Limited
Reduced Documents ~13% Self Self Limited
Employed Employed
Second Liens ~14% Limited Limited Limited
Premium Payment Monthly Single Single Single
Sub-Prime, Reduced Doc And Second Liens Based On Company Estimates
Raymond James Conference – March 5, 2008 10
12. International Mortgage Insurance Strategy
Primary Risk In Force
($B)
151
Canada
Canada & Australia
Customer Penetration
Underwriting & Pricing Discipline
Ensure Exposure Management
Expand Support Services
Australia
Europe & Other
Slowed Expansion
Europe / Other Selective Geographies / Lenders
12/31/2007 Build Gradually For The Future
See Appendix For Details Regarding Global MI Risk In Force
Raymond James Conference – March 5, 2008 11
13. Expanding U.S. Wealth Management
Assets Under Management
3 Yr
($B)
CAGR
22 ~ 34%
Strong Organic & Acquisition Performance
AssetMark ~ 33% Advisor Expansion & Penetration
Acquisition
Leveraging Practice Management Services
~ 36%
Existing
Platforms
2007
Total Market AUM Outlook
($T) 3 Yr
Expect Future Growth Ahead of Market
CAGR1
~ 12%
2.8 – Product Innovation/Income Guarantees
Independent ~ 17% – Expanded Services Offerings
– Acquisitions
Other Channels ~ 11%
2010E
1
Cerulli & Management Estimates
Raymond James Conference – March 5, 2008 12
14. Positioned For Income Guarantee Market
Individual VA 401(k) / Managed Mutual
403(b) Money Funds
(Retail + Rollover)
Market
~ 5.6 2.8 1.7 2.7
Size1
Market
5 - 8% 9% 15%+ 15%+
Growth1
Genworth
✓ Established ✓ Established In Process
Early Mover
Position
~$10 Trillion Opportunity for Income Guarantees
1 Company And 3rd Party Estimates. Market Size In Trillions
Raymond James Conference – March 5, 2008 13
15. U.S. Mortgage Insurance Overview
Risk Mix Of Book An Important Differentiator
Captive Reinsurance Protects Downside
Product, Price & Guideline Actions In 2007/2008
Quality Revenue Dynamics
Primary Delinquency Rates
7.0%
Industry
6.5%
6.0%
5.5%
5.0%
4.5%
Genworth
4.0%
3.5%
3.0%
2.5%
2.0%
Dec ‘06
Dec ‘05 Jun ‘06 Jun ‘07 Dec ‘07
Industry Represents MGIC, PMI, UGI, ORI, and Triad Based on MICA Reports. Delinquency Rate Represents Number of Lender Reported Delinquencies
Divided by Number of Remaining Policies Consistent with Industry Practices
Raymond James Conference – March 5, 2008 14
16. U.S. Mortgage Insurance Portfolio
Risk In Force
91% Prime Book
Avoided Sub-Prime Bulk & Second Liens
Performing 70-75%
Worked to Minimize Stacked Risk Factors
Moved Actively On Risk & Pricing Guidelines
With Market Shifts
2004 & Prior Books – Appreciation Benefit
2005-2007 Books – Blended Performance &
Under-
25-30%
Performing Reinsurance Protection
Portfolio Mix
Under-Performing Refers To Selected Product, Geographical and Book Year Combinations Where Ever-To-Date Actual Loss Ratio Performance Exceeds Ever-To-Date
Pricing Expectations. Select Geographies Include CA, FL, AZ, NV and Great Lakes, Select Products Include Alt-A, A Minus and Sub-Prime.
Raymond James Conference – March 5, 2008 15
17. Lender Captive Reinsurance Protection
63% GNW Flow Portfolio Has Lender Captive Reinsurance Coverage
– Protects Downside Risk
Written on a “Book Year” Basis By Lender
Attachment Points Are % of a Book Year’s Original Risk In Force
Reinsurance Premiums Deposited in 3rd Party Trust
40% Cede Excess of Loss Example 25% Cede Excess of Loss Example
Premiums Losses Premiums Losses
Lender 25%
Remaining Remaining
Lender 40% GNW GNW
Losses Losses
2nd Loss 2nd Loss
Lender Lender
(4-14 Claims Layer)
60% 75% (5-10 Claims Layer)
GNW GNW
1st Loss (0-4 Claims Layer) 1st Loss (0-5 Claims Layer)
GNW GNW
Captive Reinsurance Liability Limited to Funds in Trust, Not Subject to Lender Bankruptcy.
Trust Balance Impacted by Future Premiums Received, Payment of Claims and Dividends.
Percentage of GNW Portfolio in Captive Reinsurance Arrangements As of 12/31/07.
Raymond James Conference – March 5, 2008 16
18. Lender Captive Attachment Progression
2006 Book Year Example
$4.3B Original Risk In Force With Captive Reinsurance Coverage
$173MM Losses = Sum of All Attachment Points
46 Lender Captives Comprise Total – Actual Attachment Will Vary By Lender
2006 Attachment Trend As Of 4Q07
% Progression to RIF Ever to Date
Specific Lender Remaining Incurred Losses
Attachment Point ($B) ($MM)
0 – 50% .7 10
50 – 75% 1.8 55
75 – 100% .8 31 Includes ~$1MM of Captive
Reinsurance Benefit
100%+ (Captive Benefit) .1 5
3.4 $101
58% Progression to Aggregate Attachment Point
Aggregate Book Year Analysis Provided To Illustrate Directional Progression Toward Attachment. Data Presented in Aggregate For All
Trusts. Actual Trust Attachment Will Vary By Individual Lender Contract. Additional Book Years Included in Appendix.
Incurred Losses = Change in Reserves + Paid Claims. Information Excludes Quota Share Captive Arrangement Data.
Raymond James Conference – March 5, 2008 17
19. Product Actions Taken For 2008
Flow New Insurance Written
Products Not Insured By Genworth
Sub-Prime Bulk Alt-A >95% LTV
100%
Sub-Prime 2%
Product Exits 5%
A-Minus
1%
Alt-A
Alt-A > 90% LTV, < 660 FICO Prime 12%
A Minus Above 95% LTV, < 575 FICO > 95% LTV
100 LTV < 620 FICO And Interest Only
Guideline Restrictions
Prime
Primary & 2nd, Purch. & Rate Term
Alt-A 80%
≤ 95% LTV
A Minus Primary Only
100 LTV 95% LTV In 85 Declining Markets
Price Increases
Alt-A ~43% In 660 – 699 FICO Bucket
A Minus ~18% Price Increase 2008E
100 LTV ~50% Increase For 56% of NIW
Genworth Alt-A Consists Of Loans With Reduced Documentation Or Verification Of Income Or Assets And A Higher Historical And
Expected Default Rate Than Standard Documentation Loans.
Raymond James Conference – March 5, 2008 18
20. U. S. Mortgage Insurance – Looking Ahead
Market Returns To MI Book Value Supported
($B)
Investor Briefing Scenario
($B) @ 100% Loss Severity $3.9+
287
$0.7
$0.5 New
65% $2.6 Business
Invest.
Income
Existing
174 Business
Underwriting
Margin
12/31/07 12/31/12E
2008E Book Value $2.5 to $2.6B
Quality New Business
$3B Investment Portfolio
2006 2007
Captive Reinsurance Coverage
U.S. MI Flow NIW Market1
1 Inside Mortgage Finance As Of January 31, 2008 See February 8, 2008 Investor Update In Its Entirety For Scenario Details
Raymond James Conference – March 5, 2008 19
21. Investment Portfolio
($B)
$74 Quality Assessment
~50% Investment Grade Bonds
Commercial Mortgages LTV ~52%
49%
Investment
Commercial MBS 98% Investment Grade
Grade Public &
Private Bonds – Original Average LTV ~69%
Avoided RMBS CDOs
Municipals Underwritten to Underlying Credit
Securities Lending A-1/P-1 and AAA
Commercial
12%
Mortgages
Risk Considerations
12%
CMBS & ABS
$2.9B Remaining Sub-Prime / Alt-A RMBS –
RMBS 7%
Substantial Markdowns Taken
Cash & ST 4%
Non-Inv Grade 4% Below Investment Grade Under 4%
Municipal 3%
Sec Lending 3%
Equities Less Than 1%
Equity & LPs 2%
Policy Loans 2%
LTC Hedges/Others 2% 12/31/07
Raymond James Conference – March 5, 2008 20
22. Sub-Prime Securities Update
Sub-Prime RMBS
($MM)
1,486
95% Level 2 Pricing
AAA Regular Performance Monitoring
$71MM After-Tax Impairments 4Q ’07
AA – Primarily 2006 Vintage
– 75% < BBB
A – 25% Single A
BBB/BB/B
Market Value
12/31/07
($284) Change In Market
Value Since 9/30/07
Raymond James Conference – March 5, 2008 21
23. Five Levers to Drive Shareholder Value
Impact
2008E 2009/10E
2004 – 2007
Core Growth & Improving Returns
++
++
International/Retirement & Protection ++
U.S. Mortgage Insurance + +
-
Capital Management & Redeployment ++
++
++
+
Cost Efficiencies ++
Neutral/+
+
Neutral +
Investment Performance
+
Smart Use Of Capital Markets ++
+
Raymond James Conference – March 5, 2008 22
24. Focus On Redeploying Low Return Capital
Select Blocks Targeted
($B)
2.8
Reassessed Blocks Under Integrated
Retirement & Protection Organization
Life / Annuities
Assessing Reinsurance, Capital Markets
and Closed Block Options
8 to 12 Percent Pricing Action
Old LTC Pursuing Extraction Options
– Individual Or Blended Blocks
12/31/2007
Raymond James Conference – March 5, 2008 23
25. The Case For Genworth
Shifting Mix For Growth & Returns
Expanding International & Wealth/Retirement Platforms
Capital & Risk Management Discipline
ROE Expansion Path – Manageable Disruption In 2008
13%-14%
11.0% 11.0%
10.4%
2010 – 2011
2005 1 2006 2007
Target
1 See Genworth’s 4Q ’05 Income Press Release (Dated 1/26/06) For Reconciliation. GAAP Basis ROE 10.7%.
Raymond James Conference – March 5, 2008 24
27. Captive Reinsurance - Disclosure
Captive Disclosure Q4 2007
Original Book 4Q07
Progression
Sum of Loss to Additional Losses Aggregate %
Ever to Date
Attachment Attachment to
Incurred Losses to Reach Aggregate
RIF ($B) Points ($MM) Point Current RIF ($B) Attachment ($MM) Attachment
Book Year ($MM)
2005 Total 3.0 125 2.0 61 64 49%
0.8 16
0 -50%
0.8 28
50 -75%
0.4 15
75-99%
0.0 2
Attached
2006 Total 4.3 173 3.4 101 72 58%
0.7 10
0 -50%
1.8 55
50 -75%
0.8 31
75-99%
0.1 5
Attached
2007 Total 7.2 289 6.9 56 233 19%
6.9 56
0 -50%
0.0 0
50 -75%
0.0 0
75-99%
0.0 0
Attached
Captive Benefit in Quarter ($MM) 1
Aggregate Book Year Analysis Provided To Illustrate Directional Progression Toward Attachment.
Data Presented in Aggregate For All Trusts. Actual Trust Attachment Will Vary By Individual Lender Contract.
Incurred Losses = Change in Reserves + Paid Claims
Information excludes Quota Share Captive Arrangement Data.
Raymond James Conference – March 5, 2008 26
28. A 5-Year View
Key Assumptions Book Value Profile
$3.9+
($B) @ 100% Severity
Existing Portfolio
$0.7
Claim Frequency Expectation for Every 100 Loans
$0.5 New
Claim Frequency Captives
$2.6 Business
Portfolio Lifetime Attach?
Ever-To-Date Invest.
Income
Existing
’04 & Prior No
1.4 2
Business
’05 – ’07 Yes
0.3 8
Underwriting
’08 & Forward No
- 4
Margin
12/31/07 12/31/12E
Performing Well 5
2005-2007 Books @ 115% Severity:
Under-Performing 13
$.1B Additional Losses By 2012
Book Value Progression
$3.9+
($B) @ 100% Severity
$2.6 $2.5-2.6
Company Estimates; Captive Attachment Based on Aggregate Analysis – Actual Results
Will Vary By Lender
Lifetime Loss Ratio Reflects Weighted Average Lifetime Expected Loss Ratio For Total
Portfolio
Existing Business and Investment Income Are Net of Income Taxes
Existing Business Includes After Tax Premium From International Support Arrangements
Projected Book Value Excludes Impact of Dividends From Our U.S. Mortgage Insurance
Subsidiaries to Genworth
2007 2008E 2009E 2010E 2011E 2012E
Raymond James Conference – March 5, 2008 27
29. Scenarios: Exhaust Captives or Eliminate Book Value
Exhaust Captive Coverage U.S. Mortgage Ins. Book Value To 0
Claim Frequency Assumptions for Every 100 Loans Claim Frequency Assumptions for Every 100 Loans
Claim Frequency Claim Frequency
Captives Captives
Portfolio Portfolio
Attach? Attach?
Ever-To-Date Ever-To-Date
Lifetime Lifetime
’04 & Prior ’04 & Prior
No No
1.4 1.4
2 2
’05 – ’07 ’05 – ’07
Yes Yes
0.3 0.3
15 40
’08 & Forward ’08 & Forward
No No
- -
4 4
Performing 8 Performing 10
Under-Performing 25 Under-Performing 81
Book Value Profile
$2.9+
($B) @ 100% Severity
$0.6
$(0.3)
$2.6 New
Business
Invest.
Existing Income
Business
Underwriting
Margin
12/31/07 12/31/12
2005-2007 Books @ 115% Severity: Company Estimates; Captive Attachment Based on Aggregate Analysis – Actual Results Will Vary By Lender
Existing Business and Investment Income Are Net of Income Taxes
$.2B Additional Losses Incurred By 2012 Existing Business Includes After Tax Premium From International Support Arrangements
Projected Book Value Excludes Impact of Dividends From U.S. Mortgage Insurance Subsidiaries to Genworth
Raymond James Conference – March 5, 2008 28
30. U.S. MI Portfolio – Delinquency Rates
($B)
Total FICO > 660 FICO 620 - 659 FICO < 620
Primary Risk In Force 3Q 07 4Q 07 3Q 07 4Q 07 3Q 07 4Q 07 3Q 07 4Q 07
$31.3
$28.1 $2.9
$6.4
$22.1
Primary Risk In Force $19.7 $5.9 $2.5
3.4% 4.3%
Default Rate 1.9% 6.3% 10.5% 12.8%
7.5%
2.5%
$12.1
$8.1 $2.4 $1.3
2007 Policy Year $5.5 $8.5 $1.7 $0.9
1.4% 2.8%
Default Rate 0.9% 1.7% 5.0%
3.8% 9.4%
1.7%
$6.0 $5.9 $0.6
2006 Policy Year $4.2 $1.2 $0.6
$1.2
$4.1
3.8%
Default Rate 2.2% 6.0% 12.6%
5.4% 15.4%
8.3%
3.6%
$4.4 $4.2 $0.9 $0.3
2005 Policy Year $3.1 $0.9 $0.4
$3.0
4.0%
Default Rate 2.4% 6.6% 12.2%
5.2% 8.5% 14.4%
3.2%
$9.1
$9.6 $0.7
2004 & Prior Policy Years $6.8 $2.1 $0.7
$6.5 $1.9
4.3% 4.7%
Default Rate 2.2% 8.8% 14.0%
2.4% 9.5% 15.3%
$26.2 $29.4
Fixed Rate $18.2 $5.6 $2.4 $2.7
$20.6 $6.1
3.3%
Default Rate 1.7% 6.2% 10.3% 12.5%
4.0% 2.1% 7.2%
$1.9 $1.9
ARMs $1.5 $0.3 $0.1
$1.5 $0.3 $0.1
4.1% 7.2%
Default Rate 5.9%
3.0% 9.0% 17.1%
12.0% 23.2%
$7.9 $2.3 $1.2
$8.8
LTV > 95% $4.7 $2.1 $1.1
$5.4
4.6% 5.8%
Default Rate 2.1% 6.4% 11.6%
2.6% 8.0% 15.3%
$1.9 $1.9 $0.3 $0.1
Alt-A $1.5 $0.3 $0.1
$1.6
4.1% 6.2%
Default Rate 3.3% 7.9% 13.2%
5.1% 11.7% 18.2%
$3.6 $3.3
$4.0 $0.5
Interest Only & Option ARMs $2.9 $0.5 $0.2 $0.2
3.1% 5.0%
Default Rate 2.6% 5.7% 9.9%
9.2%
5.6% 16.8%
= Significant Increases in Delinquency Rates
Loans With Unknown FICO Scores Are Included in the FICO 620 – 659 Category
Delinquency Rate Represents Number of Lender Reported Delinquencies Divided By Number of Remaining Policies Consistent With Mortgage Insurance Industry Practices
GNW Alt-A Consists of Loans With Reduced Documentation or Verification of Income or Assets And a Higher Historical And Expected Default Rate Than Standard Documentation Loans.
Raymond James Conference – March 5, 2008 29
31. Comparing Global MI Risk In Force
($B) Effective
LTV
77
Effective
66 75%
LTV 16
13 86%
14 71%
9 77%
10 63%
7 71%
Effective
Vintage
31 LTV1
2007
22
94%
12 ~60% 27 ~60%
Effective
2006
5 93% LTV
2005 8
4 88%
2004 92%
15 ~50%
<80%
9 87%
10 ~50%
& Prior
~75% ~70%
1
Bulk
U.S. Canada Australia Europe
Canada and Australia – Solid Embedded Home Price Appreciation
Book Year Risk In Force and Effective LTV Based on Flow; Total Bulk Shown Separately
1
Primary Risk In Force as of 12/31/07
Raymond James Conference – March 5, 2008 30
32. Sub-Prime RMBS Holdings
($MM)
Total = $1,486
468
<BBB 6% 345 43
265
34
A 21% 147 215
2
87 193
81 4
61 13
AA 22% 52
112 91
198
163
AAA 51% 102
166 130
2004 & Prior 2005 2006 1st Half 2006 2nd Half 2007
Stress Test Prior To Investment
Avoided Riskier Originators & 2nd Liens
Underlying LTVs ~ 80%
~4 Year Average Life
2007 Impairments: $78MM; 77% BBB & Below
Ratings Reflect Levels As Of 12/31/07
Raymond James Conference – March 5, 2008 31
33. Alt-A RMBS Holdings
682 Total = $1,449
($MM)
16
130
<BBB 2%
327 274
293
10
A 19% 71 7
61
32
AA 29% 101
99
2
262
46
214 18
126
AAA 50% 10 81
36
2004 & Prior 2005 2006 1st Half 2006 2nd Half 2007
~85% Fixed Rate Mortgages (> 5 Year)
Weighted Average FICO ~710
Underlying LTVs ~73%
2007 Impairments: $26MM; 73% BBB & Below
Ratings Reflect Levels As Of 12/31/07
Raymond James Conference – March 5, 2008 32
34. Capital Generation
($B)
Actions
2007E 2008E
U.S. Stat Earnings Retirement & Protection Growth
1.3 1.4
And Capital Release U.S. Mortgage Insurance Decline
International 0.9 1.1 Increase Reflects Growing In Force
Capital Markets
0.3 0.4 Life XXX and AXXX Securitizations
Efficiency
2007 Group Sale
Block Extraction 0.6 0.4
Selective Reinsurance
Contingency Reserve Release
Other Capital Mgmt. 0.9 0.2 2007 Equity Unit Conversion
Debt Capacity & Service
4.0 3.5
Raymond James Conference – March 5, 2008 33
35. Capital Deployment
($B)
Actions
2007E 2008E
New Business Funding International, Annuities & LTC
2.6 2.8
– Statutory Strain
Growth
– Required Capital
Bolt-On Acquisition Pipeline Maintained
.1 .2 - .5
Pipeline Target Fee Based & International
Repurchases/
1.3 .3 - .7 $1B Authorization Through ’09:
Dividends
$100MM Repurchased Through
January
4.0 3.7 - 4.0
Ending Deployable
.8 .3 - .6
Capital
Raymond James Conference – March 5, 2008 34
36. Use Of Non-GAAP Measures
This presentation includes the non-GAAP financial measure entitled quot;net operating income.quot; The chief operating decision maker evaluates segment
performance and allocates resources on the basis of net operating income. The company defines net operating income (loss) as income (loss) from
continuing operations excluding after-tax net investment gains (losses) and other adjustments and infrequent or unusual non-operating items. This
metric excludes these items because the company does not consider them to be related to the operating performance of its segments and Corporate
and Other activities. A significant component of the net investment gains (losses) is the result of credit-related impairments and credit-related gains
and losses, the timing of which can vary significantly depending on market credit cycles. In addition, the size and timing of other investment gains
(losses) are often subject to Genworth’s discretion and are influenced by market opportunities, as well as asset-liability matching considerations.
Infrequent or unusual non-operating items are also excluded from net operating income if, in the company’s opinion, they are not indicative of overall
operating trends. While some of these items may be significant components of net income in accordance with GAAP, the company believes that net
operating income, and measures that are derived from or incorporate net operating income, are appropriate measures that are useful to investors
because they identify the income attributable to the ongoing operations of the business. However, net operating income should not be viewed as a
substitute for GAAP net income. In addition, the company's definition of net operating income may differ from the definitions used by other
companies. There were no infrequent or unusual non-operating items excluded from net operating income for the periods presented in this press
release other than a $14 million after-tax expense recorded in the first quarter of 2007 related to reorganization costs. The tables in the appendix of
this presentation reflect net operating income (loss) as determined in accordance with Statement of Financial Accounting Standards No. 131,
Disclosures about Segments of an Enterprise and Related Information, and a reconciliation of net operating income (loss) of the company’s
segments and Corporate and Other activities to net income.
Due to the unpredictable nature of the items excluded from the company's definition of net operating income, the company is unable to reconcile its
outlook for net operating income to net income presented in accordance with GAAP.
In this presentation, the company also references the non-GAAP financial measure entitled “operating return on equity” or “operating ROE.” The
company defines operating ROE as net operating income divided by average ending stockholders’ equity, excluding accumulated other
comprehensive income (AOCI) in average ending stockholders’ equity. Management believes that analysis of operating ROE enhances
understanding of the efficiency with which the company deploys its capital. However, operating ROE as defined by the company should not be
viewed as a substitute for GAAP net income divided by average ending stockholders’ equity. The tables in the appendix of this presentation include
a reconciliation of operating ROE to GAAP net income divided by average ending stockholders’ equity. Due to the unpredictable nature of net
income and average ending stockholders’ equity excluding AOCI, the company is unable to reconcile its outlook for operating ROE to GAAP net
income divided by average ending stockholders’ equity.
Raymond James Conference – March 5, 2008 35
37. Consolidated Net Income by Quarter
(amounts in millions, except per share amounts)
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40. Selected Operating Performance Measures
This presentation also contains selected operating performance measures including “sales,” “assets under management”, “insurance in-
force” or “risk in-force” which are commonly used in the insurance and investment industries as measures of operating performance.
Management regularly monitors and reports sales metrics as a measure of volume of new and renewal business generated in a period.
Sales refers to (1) annualized first-year premiums for term life insurance, long-term care insurance and Medicare supplement insurance;
(2) new and additional premiums/deposits for universal life insurance, linked-benefits, spread-based and variable products; (3) gross
flows and net flows, which represent gross flows less redemptions, for our managed money business; (4) written premiums and deposits,
gross of ceded reinsurance and cancellations, and premium equivalents, where we earn a fee for administrative services only business,
for payment protection insurance; (5) new insurance written for mortgage insurance, which in each case reflects the amount of business
the company generated during each period presented; and (6) written premiums, net of cancellations, for our Mexican insurance
operations. Sales do not include renewal premiums on policies or contracts written during prior periods.
The company considers annualized first-year premiums, new premiums/deposits, gross and net flows, written premiums, premium
equivalents and new insurance written to be a measure of the company’s operating performance because they represent a measure of
new sales of insurance policies or contracts during a specified period, rather than a measure of the company’s revenues or profitability
during that period.
Management regularly monitors and reports assets under management for the company’s managed money business, insurance in-force
and risk in-force. Assets under management for the company’s managed money business represent third-party assets under
management that are not consolidated in our financial statements. Insurance in-force for the company’s life insurance, international
mortgage insurance and U.S. mortgage insurance businesses is a measure of the aggregate face value of outstanding insurance policies
as of the respective reporting date. Risk in-force for the company’s international mortgage insurance and U.S. mortgage insurance
businesses is a measure that recognizes that the loss on any particular mortgage loan will be reduced by the net proceeds received upon
sale of the underlying property. The company considers assets under management for the company’s managed money business,
insurance in-force and risk in-force to be a measure of the company’s operating performance because they represent a measure of the
size of the company’s business at a specific date, rather than a measure of the company’s revenues or profitability during that period.
These operating measures enables the company to compare its operating performance across periods without regard to revenues or
profitability related to policies or contracts sold in prior periods or from investments or other sources.
Raymond James Conference – March 5, 2008 39
41. Cautionary note regarding forward-looking statements
This presentation contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking
statements may be identified by words such as “expects,” “intends,” “anticipates,” “plans,” “believes,” “seeks,” “estimates,” “will,” or words of similar meaning
and include, but are not limited to, statements regarding the outlook for our future business and financial performance. Forward-looking statements are based
on management’s current expectations and assumptions, which are subject to inherent uncertainties, risks and changes in circumstances that are difficult to
predict. Actual outcomes and results may differ materially due to global political, economic, business, competitive, market, regulatory and other factors and
risks, including the following:
• Risks relating to our businesses, including interest rate fluctuations, downturns and volatility in equity and credit markets, defaults in portfolio securities,
downgrades in our financial strength and credit ratings, insufficiency of reserves, legal constraints on dividend distributions by subsidiaries, competition,
availability and adequacy of reinsurance, defaults by counterparties, regulatory restrictions on our operations and changes in applicable laws and regulations,
legal or regulatory investigations or actions, political or economic instability, the failure or any compromise of the security of our computer systems, and the
occurrence of natural or man-made disasters or a pandemic disease;
• Risks relating to our Retirement and Protection segment, including unexpected changes in morbidity and mortality, accelerated amortization of deferred
acquisition costs and present value of future profits, goodwill impairments, reputational risks as a result of our plans to file for an increase in the premiums on
certain in-force long-term care insurance products, medical advances such as genetic mapping research, unexpected changes in persistency rates, increases
in statutory reserve requirements, and the failure of demand for long-term care insurance to increase as we expect;
• Risks relating to our International segment, including political and economic instability, foreign exchange rate fluctuations, unexpected changes in
unemployment rates, deterioration in economic conditions or decline in home price appreciation, unexpected increases in mortgage insurance default rates or
severity of defaults, decreases in the volume of high loan-to-value international mortgage originations, increased competition with government-owned and
government-sponsored entities offering mortgage insurance, changes in regulations, and growth in the global mortgage insurance market that is lower than we
expect;
• Risks relating to our U.S. Mortgage Insurance segment, including the influence of Fannie Mae, Freddie Mac and a small number of large mortgage lenders
and investors, decreases in the volume of high loan-to-value mortgage originations or increases in mortgage insurance cancellations, increases in the use of
simultaneous second mortgages and other alternatives to private mortgage insurance and reductions by lenders in the level of coverage they select,
unexpected increases in mortgage insurance default rates or severity of defaults, deterioration in economic conditions or a decline in home price appreciation,
increases in the use of reinsurance with reinsurance companies affiliated with our mortgage lending customers, increased competition with government-owned
and government-sponsored entities offering mortgage insurance, changes in regulations, legal actions under Real Estate Settlement Practices Act, and
potential liabilities in connection with our U.S. contract underwriting services; and
• Other risks, including the possibility that in certain circumstances we will be obligated to make payments to GE under our tax matters agreement even if our
corresponding tax savings are never realized and payments could be accelerated in the event of certain changes in control, and provisions of our certificate of
incorporation and by-laws and our tax matters agreement with GE may discourage takeover attempts and business combinations that stockholders might
consider in their best interests.
We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise.
Raymond James Conference – March 5, 2008 40
