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Risk-based capitalization will continue to improve gradually, driven by the ongoing reduction of the equity backing ratio, the increased emphasis on less capital-intensive protection products and the increased utilization of soft capital (i. This capital strength enables Standard Life to maintain a high equity backing ratio for the benefit of its with-profits policyholders, without threatening the company's financial strength. ; while with-profit liabilities are backed predominately by equities (99% equity backing ratio in 1997), investment leverage is low at 294%. |
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