Executives: Bertrand Bougon - Head of IR Denis Kessler - President and Chief Executive Officer Mark Kociancic - Chief Financial Officer Francois de Varenne - Chief Executive Officer of Global Investments Frieder Knüpling - Chief Risk Officer Victor Peignet - Chief Executive Officer Global P&C Paolo De Martin - Chief Executive Officer Global

Life
Analysts: Vinit Malhorta - Mediobanca Kamran Hossain - RBC Xin Mei Wang - Morgan Stanley Andrew Ritchie - Autonomous Thomas Fossard - HSBC Jonny Urwin - UBS Frank Kopfinger - Deutsche Bank Vikram Gandhi - Societe Generale Anasuya Iyer - Jeffries Paris Hadjiantonis - Credit Suisse

Bertrand Bougon: Good morning everyone, and thank you for joining the SCOR Group Third Quarter 2016 Results Conf Call. Before starting this presentation, please consider our disclaimer on page two, which indicates that the presented Q3 figures, the Q3 2016 financial information is unaudited. With this, I would like to give the floor to Mr. Mark Kociancic, CFO of the SCOR Group. We are joined on this call by the entire committee.

Mark Kociancic: Thank you Bertrand, and good morning everyone. First of all, Denis Kessler asked me to pass on his regrets for not being able to attend today due to a scheduling conflict. But coming back to our agenda, let me comment on the quarter. SCOR is producing high quality results this quarter in terms of earnings, cash flow generation, profitability and solvency, and I'll comment on these in more detail as we move along. As some of you know already, SCOR's third quarter has been punctuated by several events.

We successfully launched Vision in Action, our new strategic plan for the period running from July 2016 to June 2019. Vision in Action started positively as we have successfully achieved both targets defined in the plan with a return on equity of 10.7% in the third quarter, above our target of 800 basis points above the five-year risk-free rate over the cycle, and an estimated solvency ratio of 212% at the end of the quarter, well within the optimal range of 185% to 220%. We appreciated Moody's upgrade to Aa3, as well as the other three rating agency affirmations. And as previously announced, SCOR successfully redeemed the balance of its EUR350 million and CHF650 million undated subordinated note lines. But before going into more details on our financial performance, allow me to take some time to expand on the rating agency upgrade and affirmations following the presentation of Vision in Action.

We welcome Moody's upgrade to Aa3 with a stable outlook in September, and despite an uncertain environment, Moody's decided to upgrade us. This is an excellent achievement for SCOR. It highlights the strength of SCOR's strategy, our business model and our results. The reasons given by Moody's for this upgrade are fully consistent with the profitability and solvency targets of our new strategic plan Vision in Action. In addition, all other rating agencies affirmed their ratings on SCOR, and these affirmations are the recognition of our team efforts.

But most of all, they confirm the resilience of SCOR's strategy over the past 14 years and their support of our new three-year plan, Vision in Action. It demonstrates the strength of SCOR's global franchise, and reinforces our tier 1 positioning. And I'd like to point out that SCOR is now the only company to have three AA ratings in France when we consider all sectors and exclude government-related entities. Let me move on to slide five, with regards to the results themselves. SCOR writes EUR10.2 billion of gross written premiums during the first nine months of 2016, which represents a 4.4% increase at constant foreign exchange rates.

This top-line growth particularly benefits from the strong contribution of SCOR Global Life, with a 7.8% rise at constant exchange rates. SCOR Global P&C's gross written premiums are broadly stable at constant exchange rates and slightly decreased by 2.8% at current exchange rates. SCOR records a net income of EUR438 million for the first nine months of 2016 generating a year to date 9.3% return on equity. The P&C net combined ratio for the first nine months of the year stands at 93%, and our life technical margin continues to outperform at 7.1%, exceeding the Vision in Action assumption, while SCOR Global Investments delivers its solid return on invested assets at 2.9%, driven by its active portfolio management. Moving on to Page 7.

Total shareholders' equity increases by 1.1% since the beginning of the year to reach €6.4 billion. The shareholders' equity is boosted by the strong net income recorded thus far in 2016, while accounting for the €278 million in dividends paid out in the second quarter. The book value per share stands at €34.65 per share. Today's share price therefore represents a significant discount to book value. It's worth mentioning that SCOR's book value per share has increased by 45% during the last five years, or 70% when accounting for the dividends which have been distributed, reflecting a significant increase in shareholder value and remuneration.

The financial leverage ratio stands at 25.1%, and is expected to diminish under the 25% threshold indicated in Vision in Action by the end of 2016. Let's move on to Slide 8. SCOR delivers a particularly robust operating cash flow of €1.3 billion on a year to date basis, however, we benefit from two non-recurring items. SCOR P&C benefits from a one-time €300 million return of collateral of funds withheld payment, and SCOR Global Life partly benefits from a timing difference in its claim payments, which is expected to normalize on a year to date basis in the fourth quarter of 2016. Overall, it's important to underline that the Group records excellent recurring cash flows, above our expectations, even when we exclude the non-recurring items.

The total liquidity decreased to €1.9 billion at 30 September compared to the first half of 2016 following the debt repayments that I mentioned earlier, and the start of the normalization of the asset allocation, which Francois will explain later on. Let me hand it over now to Victor for the P&C results.

Victor Peignet: Good morning. This is another strong performance for the quarter, and on a year to date basis. The third quarter results remain fully in line with the metrics of optimal dynamics from the profitability standpoint, both in actual terms and on a normalized basis.

In actual terms, the net combined ratio comes out at 93%. And the attritional loss ratio plus commission ratio at 80.5% continues to be excellent, which is really telling in terms of where we are. We are not depending on net cat profits to perform. As we get closer to the 1/1 renewals, and having now entered into the active phase of the renewal discussion, we remain confident in the assumptions we made when we constructed Vision in Action. We are currently busy working on the implementation of Vision in Action, and in particular of the business development in the U.S.

market. Pipeline there is building up nicely, and we see opportunities to close a significant volume of new business between now and the end of the year. While we are progressing in our initiatives and in our business developments at a pace that allows us to confirm the gross rate indication that we gave at the IR day, we see a gross premium income at the end of Q3 that is stable year on year at constant exchange rate. This situation is due to the conjunction of a series of one-off non-recurring adjustments that were processed during the past few weeks of the third quarter closing. We've been somewhat caught by surprise by a number of further reductions of ultimate premium estimates from sitting companies.

These reductions relate to underwriting years 2015 and 2016. They mostly impact the engineering, and marine and offshore business lines, which are the ones mostly directed, affected by the prolonged status of slowdown or depression of the global economy and the oil price. In addition, in November renewal perspective in the aviation market led to downward revisions of the 2016 underwriting year projection in anticipation of re-underwriting and rebalancing decisions to be made on airline portfolios. On top of these reductions, and in order to protect the bottom line, we have had to take a view on our own production and to be even more selective in cases and areas where competition has driven contract terms and conditions down to what we feel are unsustainable levels. This has been particularly necessary in some of the large corporate business for business solutions and in Latin America for P&C treaties.

As a consequence, and despite the promising pipeline for Q4 and beyond, which will hopefully materialize and be reflected in the 2017 figures, we foresee a 2016 freer gross premium income close to EUR5.6 billion than to our last indication of EUR5.8 billion. I will conclude with a few words about Hurricane Matthew. This is a Q4 event, and we are still in the process of gathering the information we need to be able to come up with a duly substantiated total net loss estimate. However, considering the net cat ratio at the end of Q3 on a year to date basis, and the Q4 net cat loss activity to date, including Matthew, we think that the 6% budget remains, as of today, a good proxy for the full year of 2016. I will now hand over to Paolo for the presentation of the life division results.

Paolo

De Martin: Thank you, Victor. Moving on to page 10 of the presentation, I'm pleased to report that in the first nine months of 2016 SCOR Global Life continues to combine growth and strong profitability. Gross written premiums reach almost EUR6 billion, which represents a growth of 7.8% at constant exchange rate, and 6.1, or 6.1% at current exchange rates. During the first nine months of 2016, we continued to invest in expanding our franchise in Asia Pacific, with good new business inflow in both protection and financial solutions. We're very pleased to be awarded Life Reinsurer of the Year by Asia Insurance Review.

We've been active in the Asia Pacific life reinsurance markets for over 30 years, and have established strong and long-lasting relationships with our clients there. It is a key region for SCOR Global Life development in our Vision in Action strategic plan. As part of our global distribution solution effort, we're further expanding our offering in the region with the launch of Velogica in Asia, a state-of-the-art new business acquisition platform to support our customers in growing their own business. We're also pleased with the continuing new business inflow observed across all product lines in EMEA and Americas where we have been awarded North America Life Reinsurer of the Year by Reaction magazine for the second year running. The division of our old premium growth has been further supported by the positive development of our in-force book of business.

Looking ahead to the end of 2016, we expect growth in premiums to normalize at around 6% versus prior year, with the potential upside due to our strong longevity and new business pipeline. Overall, technical performance over the first nine months of 2016 remains robust with the technical margin standing at 7.1%, slightly above the range assumed in Vision in Action. We've been able to deliver this technical margin thanks to both the profitability of our new business, and the in-force portfolio results in line with our expectations. I will now hand over to Francois de Varenne, CEO of SCOR Global Investments, for more details on our Group investment strategy. Francois

de Varenne: Thank you Paolo.

Moving on to Slide 11. SCOR's total investment portfolio reaches €27.6 billion at the end of September 2016, with an invested asset portfolio of €19.2 billion compared to €18.8 billion at the end of June. During the third quarter, SCOR Global Investments began the normalization of its asset management policy, as announced in the Vision in Action plan. Liquidity was reduced by 4 points, the proportion of corporate bonds increased by 5 points, and duration of fixed income portfolio was increased from 4 to 4.5 years compared to June level. The high quality of our fixed income portfolio has been maintained as well, with a stable average rating of AA minus.

Moreover, SCOR Global Investments has maintained a very strict policy of avoiding any sovereign exposure to Eurozone peripheral countries. At the end of September, expected cash flows from the fixed income portfolio over the next 24 months stand at €6.4 billion, despite the partial normalization of the investment portfolio completed during the past quarter. It will facilitate the dynamic management of foreign investment policy as market conditions permit. In spite of the prolonged low yield environment, SCOR Global Investments manages to deliver strong and recurring return on invested assets, which stands at 2.9% for the first nine months of 2016, well above our risk free benchmark. For the full year 2016, given our current investment rate and normalization strategy, we expect a return on invested assets in the middle of the Vision in Action range.

With this, I will hand it over to Bertrand Bougon for the conclusion of this presentation.

Bertrand Bougon: Thank you Francois. On Page 12 you will find the next scheduled events, which are the January renewals on February 9, 2017, and the full year 2016 result on February 22, 2017, as well as all the conferences which we are planning to attend over the remainder of 2016. With this, we can now start the Q&A session. Thank you.

Operator: Thank you. [Operator Instructions] We will take our first question today from Vinit Malhorta from Mediobanca. Please go ahead.

Vinit Malhorta: Just one on the P&C growth and one on just the asset returns. So just on P&C growth, that seems to be the key concern in the market today.

Victor, you said there is a pipeline in the fourth quarter which would show up in 2017, and you also guided to €5.6 billion as a new number for 2016. How should we think about this pipeline coming into next year? Are you in a position to say something about next years' growth please, because there could be just a timing effect that next year is much stronger growth. That's on P&C Re. The second question is on the asset management relisting. So Francois, you said a fair understanding that given as the cash position is stable almost, despite the debt flow out, is it a fair assumption that the bulk of this EUR854 million or so cash flow, operating cash flow in 3Q would actually reinvest in, outside in the corporate bond area.

If you could just clarify a little bit there, that would be great. Thank you.

Mark Kociancic: Victor, do you want to start with the P&C question?

Victor Peignet: I think we are moving on the P&C side, at least for global reinsurers, to a situation where large deals are taking a large part of the activity at the moment. So you will recall that our growth last year was pretty high, around 16%. So what we feel, ourselves, is considering the pipeline, but a pipeline is a pipeline.

We have no guarantees that those deals will be signed, but we are very hopeful that they will. Well, we could end up with a situation of rebalancing next year. For the moment, I mean realistically, that's what I said, while we are confident that what we said in IR day is applicable, we have no reason to change it. Hopefully we can even make better than that to compensate for the fact that this year we are a bit lower than what we expected.

Vinit Malhorta: Fine.

Just to be clear, the IR day was 3% to 8% for 2016 to 2018, and when you said that you are confirming that, you mean like a midpoint of that, or you don't want to get into that discussion yet?

Victor Peignet: Well, to me it's too early to tell you that. You will have a very good appreciation of that after the 1/1 renewals, but for the moment I think I can't say more than yes, we are expecting to resume growing next year and I think 3% to 8% is quite a reasonable indication. But I can't be more precise. You'll have to wait for February 9 when we publish the 1/1 renewal results.

Vinit Malhorta: Thank you.

Francois

de Varenne: Just to tell you Vinit, I'm not sure I fully captured your point. I mean, we have an increase in the total amount of fully invested asset portfolio during the quarter of roughly EUR400 million, post debt reimbursement. So that's mainly explained by, as mentioned, by marked strong operating cash flows and the one-off in the P&C division with the funds withheld payment. Then what we did in terms of rebalancing strategy, you remember we were on 14% of cash and short-term investments at the end of June. The objective of Vision in Action is to bring back this liquidity at 4 points in the invested assets portfolio.

We did half of the job during the last three months, since we are 10% today, and most of the reinvestment was focused on the USD corporate bond market, and almost exclusively in the investment grade area.

Vinit Malhorta: Yes. Just to clarify, the reason I asked my question was that the 4% reduction would have naturally happened between Q2 and Q3 because the sub-debt was paid out. But given that you had a massive cash in-flow, that would imply that the in-flow of cash was actually put to work very smartly. That was just the reason for asking the question.

Francois

de Varenne: Yes.

Operator: Thank you. We will now take our next question from Kamran Hossain from RBC.

Kamran Hossain: Two questions. First of all, reference a kind of more competitive environment in some of the specialty lines in the P&C part of the presentation, would it be possible just to talk about how this might impact plans for the Channel Syndicate, reaching profitability there and thinking about growth at the Channel Syndicate? So that's question one.

The second question is just around capital, so I guess it's one for Mark. Is there any update that you can give us on the reorganization of the entities that you referred to at the Investor Day, and also if you have been making any progress that you could give us an update on on the life reinsurance securitization?

Mark Kociancic: Okay, Victor, if you want to start with specialty lines?

Victor Peignet: Well, Channel Syndicate is exclusively a primary insurance writer. It doesn't do any reinsurance. I think at the moment, the synergies that are developed between the syndicate and the division, whether it is in large corporate or whether it is in support of some of our emerging market activities, will lead us to see the future of Channel positively. The SPF has now been approved for next year.

There is growth into it. I think we are satisfied with the way the discussion with Lloyds has been going on on that, so we remain optimistic for the development of the syndicate, which is now turning into a -- I would say -- away from being a start-up to being now an established operation.

Mark Kociancic: On your second question, for the capital update, so we continue to make progress on the SE merger project that we discussed during the IR day. No comment today. I think the earliest that we'll provide feedback on that will be the Q4 results in late February.

In terms of life securitization, maybe I'll let Paolo make a comment. Paolo

De Martin: This is more a mid-plan target for us, so we keep engaging with investors at this point. But it would be more of a mid-plan in terms of focus, so probably somewhere at the end of 2017, 2018.

Operator: Thank you. We'll now take our next question from Xin Mei Wang from Morgan Stanley.

Please go ahead. Xin

Mei Wang: I have two questions please. My first is a quick question. On the realized gains, there's €18 million on other investments. Could you just clarify what that is, and whether you think that's a recurring or sustainable part of the realized gains? Then the second question is on that 38% premium assumption, at the 1/1 renewals, what would you say would have to happen for that number to be potentially below 3%? That's my two questions.

Mark Kociancic: Okay, so Francois, just on the €18 million. Francois

de Varenne: Yes, on the EUR18 million. So those realized gains have been triggered by the disposal of some alternative funds on the secondary market during the quarter. I remind you that on non-yielding asset classes, and especially on equity and other investments, the only solution to recognize under IFRS, the gain and the value creation is to sell, and that's what we did on a few lines during this quarter. In terms of sustainability of the realization of gains during the next three years, we made some assumptions again.

I'm, at this stage, still pretty confident on the fact that we will maintain over the next three years the material contribution from non-yielding asset classes to the financial contribution.

Mark Kociancic: Victor, just on the renewals?

Victor Peignet: Well, we said that the growth of 3% was based, more or less, on kind of status quo in the market. So in order for that not to be achievable, it means that status quo would not stand and we would have further deterioration. This is not what we are anticipating. This is not what we hear.

I believe myself that we have reached a point where there is a kind of an acceptance generally that prices have got to, at the minimum have got to stand, and in certain cases have got to go up to compensate for losses in certain areas. So I don't see a further deterioration to happen. You've seen this year we already very stable prices as far as we are concerned on our overall portfolio. So no, I think again, I mean, I maintain that our hypothesis is pretty realistic. Xin

Mei Wang: Okay great.

Thank you.

Operator: Thank you. Our next question comes from Andrew Ritchie from Autonomous. Please go ahead.

Andrew Ritchie: Hello.

Hi there. Two very quick questions. Firstly for Francois. Apologies if I missed this. Could you just clarify what the reinvestment rate was for the liquidity you deployed in the quarter? I know you've given us a reinvestment rate of 1.9%, but I believe that's nine-month year to date.

Just in the discrete Q3, what did you manage to achieve on those blended liquidity you deployed in investment grade corporates? Second question for Paolo on the life business. I'm just a bit confused. On the slides you talk about the 7.1% being supported by the increased share of longevity in the product mix, which seems counterintuitive to me. I thought longevity was running below the 7.1%. If it is longevity turning out to be unusually profitable, again that's a bit surprising because I would have thought you're not recognizing much profit yet on longevity given you're not really on risk for that business until the second half of its duration.

So just explain what you mean when you refer the 7.1% to an increased share of longevity in slide 10. Thanks.

Mark Kociancic: So Paolo, why don't you start?
Paolo

De Martin: Yeah, very quickly Andrew. What we mean there is the decrease from 7.2% to 7.1% that's driven by the increased longevity in the business mix. You have in mind the Vision in Action target.

The bullet point, really on page 10 explains the drop from 7.2% to 7.1%.

Andrew Ritchie: And is it fair to say the in-force may be running slightly better than assumptions, really?
Paolo

De Martin: No. We also wrote -- compared to the plan in Vision in Action, at this point we have written less longevity business than we thought we were going to write in 2016. The rest of the business is performing slightly better than expectations in terms of volume and new business flow. Francois

de Varenne: To your question on the reinvestment rate, just a clarification of the definition of the reinvestment rate or yield, that the reinvestment yield of a marginal euro or dollar reinvested at the end of the quarter in our portfolio, with the same asset allocation, excluding cash and unyielding asset classes.

So that's as if we deployed the last day of the quarter a new euro or dollar of assets with the same asset allocation, and that's the market yield that we observe on the market the last day of the quarter. So at the end -- so that's not for the first nine months. So at the end of September, our current investment rate is 1.9%. It was 1.8% at the end of Q2, and 2% at the beginning of this year, at the end of Q1. So that's improving.

Just as an example, in dollar, our current investment rate is 2.4%, so slightly above.

Andrew Ritchie: Sorry, okay. That's fine. It is misleading, the slide. When it says year to date, that would not imply spot at the end of the quarter.

But if you're saying it is end of the quarter that's understood, thanks. Francois

de Varenne: Yeah, the year to date is a typo there. At the end of Q3.

Operator: Our next question today comes from Thomas Fossard from HSBC.

Thomas Fossard: I just wanted to come back with Victor on this macro sensitive business line triggering some lower premium.

Could you tell us also, because you specifically mentioned engineering, offshore and also aviation, you're not mentioning credit lines -- credit and surety lines. It is something on which we should expect as well some negative impact or pressure on premium development or a combined ratio. I guess that they are also quite macro-sensitive. That would be my question.

Victor Peignet: Well, that's not what we see at the moment.

I mean, credit and surety continues to stand. We -- well, you've seen the publication of the leaders in that market on the insurance side, and I think while the loss ratios are standing as well. So we are not seeing real deterioration in that part of the business.

Operator: Thank you. We will now take our next question from Jonny Urwin from UBS.

Jonny Urwin: Just two from me. So firstly just thinking about the cat budget of 6% for this year. So year to date you're running at 5.7%. It feels to me like Q2 was a bit spiky for losses, but Q3 is more benign, where obviously the budget is more weighted. So do you think 6 points is appropriate, given fairly limited loss activity and you're still running quite close? Secondly, please can you just comment on the pipeline for longevity business that you talk about on slide 10 as well? Thank you.

Mark Kociancic: Victor?

Victor Peignet: I think it is quite appropriate, and I don't think this year is particularly benign. I mean, the Q2 was pretty active worldwide. Of course, nothing really spectacular, but a serious accumulation of losses including losses that are not wind or quake, but can be pretty destructive. Eight storms in particular, and floods have been hitting, well, this year, as they have been hitting for the last few years. So I think there may be a bit less of media around those losses, but they can be seriously damaging.

So yes, I think the 6%, I mean, we are comfortable with, and as I said before, we have no reason to believe today that at the end of the year, where we are today, as of today, we have no reason to believe that we cannot complete the year around that 6% budget.

Mark Kociancic: Paolo, on longevity?
Paolo

De Martin: Yes, on longevity just to remind people on the call, here we operate on this product line with a very strict risk appetite. We have the biometric risk appetites, no assets. We have pretty much only annuity in payment, certain age cohorts we're targeting, and also portfolios that have a certain amount of experience in. So this year, applying that risk appetite, we have limited deal originations up to this point.

We do, though, have a very strong pipeline of UK deals that have come to the later stages of that pipeline. A little bit like Victor was saying, until we sign the deals we're not sure that we have the deals, but the deals are at a very advanced stage. So we can further communicate then when we communicate our Q4 results. But so far we're very happy with how that risk appetite applies to the market, and I think whether they materialize this year or next year I think we're going to have good production.

Jonny Urwin: Thank you.

Operator: Thank you. Our next question comes from Frank Kopfinger from Deutsche Bank. Please go ahead.

Frank Kopfinger: Yes, good morning. I have also two questions, and I would like to come back with my first question on the 6% nat cat guidance that you still speak to.

So far you had 5.7% in Q4. We know we have met you, you made some comments and you still suggested the 6% is probably the right number. So do you suggest that for Q4 standalone, just to be clear, that Matthew on a standalone basis is having for the quarter a 6% impact? Then my second question is for Francois on the investment income. If I look into the regular income or, how you call it, investment revenues per segment, then it's obvious that the P&C investment income, or regular income, was EUR58 million. This is pretty low.

So given that you are now re-risking and rebalancing your investment portfolio, could you give some sort of guidance how you believe this could turn out to be on a more balanced level going forward? Victor, if you want to comment on Matthew and the relative impact against the 6% cat budget?

Victor Peignet: Well, first of all we've done extensive modelling on the cat, and we are redoing that modelling every year. I think that this 6% comes from there. So I think any dilution to that modelling work, we compare that with history. I think the two converge pretty well. So considering the way we have improved and sophisticated our retro program, which we do of course take into account in our modelling, I think we believe that this is a realistic approach.

I didn't say that Matthew would be 6% in Q4. What I said, very precisely, is as of today I believe that including Matthew and Nicole, our 6% budget for the entire year stands and would cover the entire. Well, I cannot predict what is going to happen between now and the end of the year. We'll see how it develops. But for the moment, no reason to believe that our 6% budget is not going to cover all the loss activity.

Mark Kociancic: Francois, just on the allocation. Francois

de Varenne: For the -- on the question on the investment portfolio, I remind you that -- I mean, my mandate in the organization of SCOR, I manage and in charge of managing one single portfolio for the Group. Then we've got different ALM duration targets for the life and the P&C division, different currency mix, but we've got the same risk appetite for both divisions. So that's why we don't communicate our segmental target for the investment income. Again, my mandate is to manage one global portfolio.

Frank Kopfinger: On the other side, you could do it also for the entirely portfolio. You have it on your slide 19, where the regular income drops from €110 million to €88 million.

Victor Peignet: Yes, that is the fact that this is illustrated on slide 11, interest rate has been decreasing massively over the last few years. So let's say the regular income has been decreasing. That's partially offset today by the normalization of the asset management strategy, the fact that we lengthened the duration, and also what we have been doing for the last, now, almost 10 years, the active management of the portfolio, and the contribution through realized gains in the performance of the portfolio.

Operator: Thank you. Our next question comes from Vikram Gandhi from Societe Generale. Please go ahead.

Vikram Gandhi: I've got two questions. First is can you please refresh my memory about the Group's position on inflation-linked bonds? I.e.

what's the total value of the inflation linkers that you hold as of Q3? From my notes, the number is around €150 million, but that could be wrong. Secondly, can you remind us on the frequency of your review as regards to the mortality assumptions, particularly the U.S., and when is the next review due?

Mark Kociancic: Francois, if you want to deal with the inflation-linked bonds position. Francois

de Varenne: Yeah, so the inflation-linked bonds, we managed today a book of roughly €600 million, and that's mainly exposed to inflation in the Eurozone, in the UK and in the U.S.

Operator: Thank you. [Operator Instructions] -- go ahead.

Mark Kociancic: We'll just finish the second question on mortality with Paolo here in terms of the timing of the reviews. Paolo

De Martin: All our assumptions are monitored constantly. We do do an annual review of our assumptions, particularly as part of our now Solvency II processes. Used to be our MCD processes. That review is undergoing at this point.

Vikram Gandhi: Okay. That's very helpful. Thank you.

Operator: Thank you. [Operator Instructions].

We will now take our next question from Anasuya Iyer from Jeffries. Please go ahead.

Anasuya Iyer: Hi. Thanks for taking my questions. My first question was just on P&C.

If you could just talk a little bit more about the pipeline you said for the rest of the year, and whether this continues to be driven by your underweight U.S. position. The second question was on investments. I just want to understand, I guess, more about your outlook. Macro-economically, where do you believe we are on your 2.6% to 3.2% return, or where do you believe it can get to? I guess I'm curious about why you changed the liquidity position in Q3 rather than possibly waiting for Q4 when there might be a rate hike in the U.S..

Thank you.

Mark Kociancic: Victor, on the pipeline of business?

Victor Peignet: Not much detail I can give you on that except that all the clients we are talking to on that pipeline are existing clients in the U.S.. And basically that's just in line with all the work that we've been doing in that market for the last four, five years. It's corresponding to the reinforcement of the image of the company and the resources we have put into play. I can't be much more precise than that, I'm sorry.

Francois

de Varenne: On your question on the macro-economic outlook and the timing of what we are doing, if you remember in the presentation of Vision in Action early September, at the end of my section I presented three types of macro-economic scenarios. Let's say the most pessimistic one was the post-Brexit environment and market condition in July, or early July. I think we are converging to the more, to, let's say, the central scenario we've got in this plan, the gradual recovery scenario. We are more optimistic on the fact that the Fed should increase, probably in December, and still probably positively in 2017 interest rate. So we aim at rebalancing our portfolio rather quickly in the coming quarters, and we started to do it in Q3.

As I mentioned, this program during the last three months was mostly targeted towards the dollar denominated fixed income portfolio. And it has been completed at good market condition leveraging on the steepening of the yield curves, which happened in September, prior to the Fed meeting, and on the very strong primary markets in U.S. corporate bonds. Keep in mind that in spite of this rebalancing, our investment portfolio remains relatively liquid. And as shown on slide 11 we'll continue to deliver strong cash flows with EUR6.4 billion of cash flows expected to emerge from the fixed income portfolio over the next 24 months.

It will leave us a high degree of flexibility to save any investment opportunity, even in the next few months or quarter, even if we are the 5% target.

Operator: Thank you. Our next question comes from Paris Hadjiantonis from Credit Suisse. Please go ahead.

Paris Hadjiantonis: I have two today.

Firstly, on claims inflation, particularly in the UK, are you worried at all, and if not, how do you basically protect it from such a scenario? The second one is on other operating expenses. Particularly in P&C Re I can see €15 million negative this quarter. Can you explain that, and whether that is something we should be annualizing for? Thank you.

Mark Kociancic: So Victor, on the claims inflation for the UK.

Victor Peignet: Well, we do a reassessment every year of inflation rates on the claims on our business, and we will update our pricing accordingly, and we look at the adequacy of our reserves based on those studies, which are led by our claim people in coordination with our reserving and pricing actuaries.

So the only protection we have on that is one, to be accurate in how we assess the situation and two, basically adjust our pricing and our reserving accordingly. We are not at the moment seeing a situation that gives us particular concern in the UK in that respect. Francois

de Varenne: And maybe to add a point to what Victor just said, on the asset side in the GBP-denominated portfolio, we are still of relatively short duration, which is a nice way to protect the portfolio against inflation since if there is strong inflation we can rebalance and extend the duration and increase the yield on this portfolio. As I mentioned it a few minutes ago, part of our inflation-linked securities are denominated in GBP today, targeting the UK inflation.

Mark Kociancic: On the second point, with the other operating expenses and the P&C line, the figure that you're referring to is principally based on the P&C cap on amortization, which is essentially reflecting some seasonality given it's kind of a peak season during Q3.

So normally we would have something approaching €10 million a quarter. You're seeing a spike now simply because you've got a predisposition for more nat cat activity.

Paris Hadjiantonis: So you are basically guiding to around €40 million per year then, on that figure?

Mark Kociancic: That's in line.

Operator: Thank you. There are no further questions.

Mark Kociancic: Okay. Thanks very much for your attention today. We're looking forward now to the January 2017 renewals, which we'll publish and discuss at the beginning of February, and then the fiscal year end 2016 results, which we'll make public on 22nd of February. Thank you, and see you then.