Good afternoon and welcome to Sanlam's 2023 results presentation. It is my pleasure to welcome members of the Investment Analysts Society, members of the Sanlam Board, and guests joining us in the auditorium and via the webcast and telephone lines. I am Grant Davids, Head of Investor Relations at Sanlam, and I'll be facilitating today's session. I trust you will find it informative and engaging. We are joined in the auditorium by our Group CEO and Group Finance Director. We are also joined by other members of the Executive Leadership Team in the auditorium as well as online. Paul Hanratty, our Group CEO, and Abigail Mukhuba will present the financial results, and after that we will move to a Q&A session where we will welcome our Group Chief Risk Officer and Chief Actuary Lotz Mahlangeni onto the stage as well. I will now invite Paul to begin the presentation.
Grant, thanks very much, and good afternoon, ladies and gentlemen. A very warm welcome to this results presentation, and a particular warm word of welcome to Temba Mvusi, who I think is here somewhere with us, our new Chairman. So Temba, welcome to, to Sanlam. I'll give a very brief overview today and talk about our strategic progress and capital allocation before handing over to Abigail, who will cover the financial results in a few in a bit more detail. I will then wrap up with a few comments. Our key long-term targets at Sanlam that measure how we create shareholder value are Return on Group Equity Value and dividend growth. These are set to achieve a primary focus on long-term shareholder returns supported by reasonable income growth for shareholders.
2023 has seen a strong result for Return on Group Equity Value, 19.5% on an adjusted basis at a per share level, and 16.5% sorry, 16.7% on an actual basis. The adjustments for items outside our control were in respect of interest rate movements where higher interest rates led to depression in values of our business, currency movements, and the one-off tax impact of the introduction of IFRS 17 in South Africa. Cash earnings were up 21% on the previous year, allowing us to increase the dividend by 11%. Good progress was made in 2023 with strengthening our South African operations. We formed the SanlamAllianz business in Africa to create a powerful new force on the continent, and we focused on growth and synergies in the Indian market.
While we're cognizant of the risks to the global economy and financial markets, our outlook for 2024 is positive with strong underlying momentum in all of our businesses. Each of our business lines has seen strong performance in 2023. Santam, as we know, had a difficult year of underwriting for several reasons, but all of our other businesses picked up momentum during the year. Much has been said about the tough economic and consumer environment, but sales have continued to be good at Sanlam. The combination with Absa Asset Management taking out the minorities at BrightRock, acquiring a controlling stake in AfroCentric, adding two linked investment platforms, removing the minorities at Sanlam Personal Loans, and the proposed acquisition of Assupol are all contributing or will contribute to ongoing growth in our South African business.
Although we only closed the SanlamAllianz JV in September 2023, I'm delighted to say that the early progress with this business's performance has been strong. We have an excellent and diversified portfolio of businesses in the joint venture. We also have an extremely strong and capable management team to lead the business. The process of recycling capital within the group continued in 2023 in order to focus the group's investment on strong growth areas, and debt and share repurchases further assisted in the optimization of the balance sheet. Growth in our investment business, new business, was very strong in 2023, and life insurance growth was strong except within Africa north of the Limpopo River. While general insurance premium growth was modest except in India where we saw a very strong recovery in general insurance premium growth.
Our various measures of profit growth were good with earnings per share supported by the reduction in the number of shares in issue because of various balance sheet activities that I referred to earlier. Higher asset levels because of improved markets, strong experience contributions in South Africa, strong credit results in India, and improved credit spreads in South Africa all helped to support strong profit growth. Returns over 2023 for shareholders as measured by return on group equity value were excellent driven by continued new business value added and good experience variances, offset by higher interest rates, currency movements, and the one-off impact of implementing IFRS 17 and its impact on tax payments. The value of new business growth is strong reflecting both mixes, mixed changes, and expense efficiencies.
Despite our corporate action, share, and debt buybacks, the group's solvency position remains extremely strong, and the group's leverage ratio remains very low. Turning now to strategy and capital allocation. As COVID took hold in 2020, Sanlam had to refocus its strategy on building a fortress position in South Africa so that no matter what the market conditions were, we could produce good returns and good margins. Strengthening in the rest of Africa following the Saham acquisition and growing in India. Within South Africa, we've used our enviable reputation with customers to grow organically while taking opportunities to fill gaps in our portfolio or to improve scale of existing businesses. In Africa, we focus on improving our operations, exiting smaller businesses, and creating a long-term partnership with Allianz to diversify and expand our portfolio.
Within India, we've been focused on driving synergies in the credit business while improving lead generation to our various insurance businesses. In 2023, there were four transactions in South Africa aimed at strengthening our operations. Capital Legacy gives us the opportunity to serve our clients' inheritance needs better. The BrightRock transaction will allow us to drive cost and capital synergies. While the acquisition of minorities in Sanlam Personal Loans will allow us to develop our personal credit business with freedom once the credit environment improves. The acquisition of a majority stake in AfroCentric will permit us to serve the health insurance needs of our clients. Within the rest of Africa, the formation of the SanlamAllianz joint venture did not require capital deployment because Sanlam and Allianz's portfolios were simply combined, and the shareholdings set in proportion to the value of the respective portfolios.
Unfortunately, the BEE SPV, which we set up in 2018, had to be closed due to the impact of the COVID pandemic on the SPV. This closure and various share buybacks have been used to reduce the number of shares in issue for the benefit of all of our shareholders. The South African operations have progressed with their strategic execution well beyond the opportunities presented merely through further capital deployment in the last three years. I'm absolutely delighted that our Glacier market share has grown very strongly. Our retail mass volumes have surged. We've got increased funds under management in our pensions umbrella, which is really the future of the pensions market. And we've added ZAR 75 billion of net new money to our investment management business.
Our formation of a partnership with Allianz underlines our view that in the long term, we're stronger and better with good partners than operating alone. Although our joint venture's only been placed in place for a few months, we did produce a pro forma version of 2023 and 2022 so that we could compare the results on a like-for-like basis for a full year. On this basis, the joint venture's results are excellent. The net result from financial services is over 25% up. The net insurance result for the general insurance business is well within our target range, and the general insurance premium growth has also been within our long-term growth range. The disappointing item has been life new business growth, which was very disappointing in 2023. India is a strong growth market for Sanlam and an increasingly important part of the group.
Post-COVID, we're beginning to see strong growth across all lines of business. You'll recall that India was very, very badly affected by the COVID pandemic, but we're beginning to see that business all those business lines turning to strong growth. Profit growth has been strong, and the synergies created by the merger of the two credit businesses are beginning to pay off. ESG and a deep sustainability focus are being increasingly embedded into our group's operations. Our push for financial inclusion means that we now reach 45 million customers on the African continent. Our long-term goal was to get to 50 million. And our investment management business is recognized as a leader in sustainable investment.
With these few opening remarks to set the scene, I'm going to hand over to our CFO, Abigail Mukhuba, who will take you in a little bit more detail through some of the financial results. Abigail.
Thank you, Paul. Good afternoon, everyone. Before we delve into the numbers, I must provide some context to the circumstances that impact what and how we report the 2023 financial year, some of which Paul has already mentioned. Firstly, all our earnings numbers are presented on an IFRS 17 basis, being the starting point from which Sanlam-specific shareholder fund adjustments are made. In previous years, we used to use IFRS 4 as a basis. And then secondly, we had several corporate actions, as he already alluded to, and this has impacted the comparability of our results, most notably, as was now just discussed, the transaction with Allianz to form the SanlamAllianz joint venture. So that only contributed for one quarter in the reporting period.
In the online booklet, we've also included a bit more detail and analysis in terms of the pro forma numbers that Paul has already referred to. I'm not necessarily going to cover those in detail. I'm pretty much going to cover the nine months from the old former Pan-African business with three months with the SanlamAllianz JV. I think the also maybe another thing to highlight is that our health business was only included in the prior year as an associate, and now in this current year from May, it was then consolidated and therefore fully included for about seven months. And then the asset management business in the 2022 year, it was pretty much in the numbers only for a year, I mean, for a month, and then in the 2023 numbers is in for a full year.
So again, I just wanna flag that the comparability of our results, at, at times it does become a bit challenging. So then if we go into the results, our performance in 2023 was evident of the quality of the assets that we have in our portfolio. We are delighted with the stellar performance across all lines of business, wherein all achieved double-digit earnings growth rates. And this has led to the group achieving record levels net result from financial services at about ZAR 12.4 billion, and this was up 18%. And our net operational earnings were 25% up at ZAR 13.9 billion, and this was supported by investment returns. On a per-share basis, earnings increase was even better due to the benefits of the share and debt repurchase activity during the year.
The group remains strongly cash generative with net results from financial services remaining very close to cash earnings. So for this reporting period, the net impact of the reconciliation items to get to net cash earnings was relatively small with the year-on-year cash earnings available for dividend distribution increasing about 19% to ZAR 12 billion, being only 1% higher than the basic earnings year-on-year increase. I will spend more time on this slide than any of the other slides because it does deal with Sanlam's main value creation metric, return on group equity value, which was above the hurdle rate on an actual and adjusted basis for 2023. This was mainly due to a few items, some of which include we had robust new business and positive risk and credit spread experience in the covered business.
In the non-covered business, we saw improved general insurance underwriting experience in the Pan-African operations. The upward valuation of our India credit business resulting from improved performance and overall general outlook also contributed positively. Then we saw the realization of the synergies from the successful Absa Asset Management integration also contributing. All of this on top of the Santam’s improved performance. These strong contributions were partially offset to some extent by the impact of the adoption of IFRS 17 and the related tests, which is expected to be a one-off impact. Also, the impact of weaker persistency experience during the period, which resulted in the strengthening of persistency assumptions. We also saw the negative impact from economic assumption changes, mainly due to increases in the respective risk-free yields and some negative investment return assumption changes from reduced future investment return expectation.
When the SanlamAllianz transaction became effective, the take-home values of the operations that were contributed into the portfolio were negatively impacted by currency movements between the time of signing the agreements and the actual effective date, especially Egypt and Nigeria. On a per-share basis, we see that the treasury shares' impact on return on group equity value per share is quite positive. Then when we look at the capital strength of our business, it pretty much underpins our promise to our clients. We cannot live without confidence if we don't maintain capital strength and discipline. The group solvency ratio remains strong and well within target. I will now go into the analysis of the underlying business performance, starting with the life and health business. From an earnings perspective, our Africa operations, they saw favorable risk experience, higher asset-based income from improved investment markets, and strong business inflows.
These were the main reasons that we recorded upper-teen percentage growth in earnings, along with higher credit spread earnings from the credit portfolio backing life insurance liabilities. Strong single premium volumes were recorded at Retail Affluent and Sanlam Corporate to further augment our Fortress South Africa position. In India, we saw very good growth in both recurring and single premium business on the back of strong volumes from the Shriram ecosystem as well as third-party channels. Pan-African new business declined. This was due to lower single premium sales. However, as I said earlier on, one must always remember the context with which I prefaced that the results are not necessarily comparable. The volume mix in 2023 is now very different to that in 2022.
Then the value of new business reflected the sales of higher margin risk, guaranteed annuity, and investment products reflected in the volumes trend. We are satisfied with the resilience shown in our life insurance client cash flows, given the increased surrenders and fund terminations because of the tough economic condition. Management actions in place are proving to have positive impact in reducing the rate of surrenders and terminations. Speaking of management actions, I would like to now move on to the GI business. Risk management actions intentionally introduced at Santam have limited Santam's net earned premium growth to around 6% year-on-year for the conventional insurance business. If you exclude these actions, net earned premium grew by about 8%. Although off a low base, we do celebrate India's strong performance by Shriram and direct channel growth across all products.
Pan-African recorded sales volumes broadly in line with 2022. From an earnings perspective, the biggest general insurance earnings driver came from the Pan-African and Asia business due to the improvement in both underwriting margin and investment return on insurance funds. To this end, the net insurance result margin in Pan-African was within the target range of 10%-15%, with the underwriting margin benefiting from an improved experience in North and West Africa, as well as overall good cost management. We also introduced the Sanlam-specific asset mismatch reserve, which was previously only applied in the South Africa operations to address the volatility in investment return on insurance funds. India's concerted efforts on claims management led to higher reserve releases, and this added to the exceptional performance in volume sales. Investment management earnings growth was strong despite the lower performance and fund establishment fees in the South Africa operations.
Earnings were supported by synergies realized from the successful integration of the Absa Asset Management business, strong performance from Wealth Management, and a good contribution from the international business. Strong net inflows in recent periods also supported the South African and Pan-African operations. One of the biggest challenges in terms of performance in 2023 was on fund flows for the asset management industry at large, as clients continue to struggle in the current economic environment wherein disposable income and savings are under strain. Our 2023 fund flows performance was significantly lower than 2022, mainly due to once-off large mandate outflows in South Africa, as well as some withdrawals in East Africa. We also saw net retail and institutional outflows in South Africa from the Absa business. We saw increased terminations and withdrawals of investment business in Retail Affluent and Sanlam Corporate.
And then lastly, we also saw outflows in the international business following from our divestment from the wealth and financial planning business. But given the challenging economic environment, we are satisfied still with the improvement in flows, particularly what we saw in the second half of 2023. Then the last slide I would like to cover is on the credit and structuring business, particularly noting that the India operations have done exceptionally well. This stellar performance in India was mainly due to larger advances book, improved cost efficiencies, and generally better collections. This was somewhat dampened by South Africa's performance, which was negatively impacted by the overall economic conditions. In conclusion, before I hand back to Paul, we're very pleased with our financial results for 2023, which continue to evidence the quality of assets we have in our portfolio. Thank you.
Sure, Abigail, thank you very much indeed for that. I'm just going to close off with a, you know, a few remarks. The operating environment for our industry has been very difficult for several years, and we remain cautious about the outlook for inflation and interest rates, as well as the overall global macro environment. If we leave aside the risks posed by the global macro and financial markets, we remain very optimistic about the outlook for our businesses in 2024. The Santam management team is addressing the issues that have held back the underwriting results in 2023, and with the rest of the South African operations, we are focused on the integration of the businesses that we've acquired and the extraction of synergies from these businesses. We believe our strong South African franchise and its popularity with clients will continue to produce strong results.
The fiscal challenges across the African continent remain in the short run, but our portfolio of businesses and the opportunities under our control make us optimistic about producing further good results. Several significant synergies are available for us to capture over the next few years to help lift the results above their natural growth trajectory. And finally, we see tremendous momentum in our Indian operations, and we are focused on delivering strong results again from that part of the group. As well as being optimistic about Sanlam's prospects, we have tremendous balance sheet flexibility and a strong solvency position with low levels of leverage. That does allow the group to continue to be strategically flexible.
I'd like to thank you all very much for listening in today, and I'm going to ask Abigail and Lotz Mahlangeni, our Chief Risk Officer and Chief Actuary, to join me, and we will then open up to questions. And Grant Davids, the Head of Investor Relations, will make sure that we get all your questions answered. So thanks very much.
Thanks very much to Paul and Abigail, and welcome onto the stage, Lotz, the Group Chief Risk Officer and Chief Actuary. We will move to a Q&A session now, and we will begin with the telephone lines. I will ask that before a question is asked, you would please begin by introducing yourself as well as the organization that you represent. To the telephone line operator, are there any questions from the telephone line?
Yes, sir. Thank you. The first question comes from Andrew Baker of Citi. Please come ahead. Great.
Thanks, guys. Appreciate you taking my questions. Yeah, this is Andrew Baker from Citi. So three, please, if that's okay. The first is on the persistency assumption strengthening. Just wondering if you could talk through some of the underlying assumptions you've used or changed here, and then relatedly, what's your sort of persistency experience variances so far in 2024? Then secondly, just on a headline basis, the PVNBP seemed to accelerate quite a lot in Q4. Can you just help me pick apart how much of this was the SanlamAllianz JV versus an acceleration on an underlying basis ex this? And then finally, specifically related to SanlamAllianz, you made the comment that life insurance new business volumes growth was below target. Can you just give us a little bit more color in which specific markets the volumes are below what you're expecting? Thank you.
Andrew, thanks very much. Good to hear from you. I'm going to suggest that we ask Lotz to cover exactly how he went about the persistency changes with respect to Retail Mass. You also did ask how we're performing in the current year versus obviously the new set of assumptions that are in place. I think it's a little bit early for us to comment on that. Lotz, you want to?
Yeah, thank you, Paul. Hi, Andrew. It's good to hear from you again. So let me start with a question around the persistency experience. So we review our assumptions on an annual basis based on the experience that's emerging. We look at it by duration, and we also look at it by type of product.
So what we've done as part of the actual basis changes was to review our experience and to adjust it on a targeted basis based on the durations experience relative to what the assumptions were. So we've looked at our experience, and then we've revised our assumptions accordingly based on what we were seeing in terms of the experience that was breaching our assumptions. You'll see in our results what the negative percentage experience was for 2023, and then you'll see the large adjustment that we've made to our assumptions to kind of bring our assumptions in line with the experience that we were seeing. In terms of 2024, it is a bit too early.
I mean, we've only had two months in 2024, so it is a bit too early to determine what I mean, we have a three-month lag in terms of how we monitor our experience because of what is defined as in terms of lapsation. But what we've seen towards the end of last year and also beginning of this year is evidence that the persistency experience was stabilizing, and we still believe that the assumptions that we made were appropriate.
So Andrew, just I'll carry on. If you want more from Lotz on the persistency, just please indicate to us at the end. Then you asked a question about the acceleration of new business premiums in quarter four and whether that was attributable to the JV in Africa. It definitely wasn't because life business was actually disappointing in the JV.
And then you asked us to go into which countries that related to. So I think and Lotz and Abigail, help me if I'm wrong here, I think Botswana continued to be a major disappointment. And then Morocco was pretty flat as well, and that was an area that in the previous year, we'd seen quite a big pickup in. I think those are the main ones, yeah. Andrew, is there anything else you want us to go into on those topics?
Yeah, that's pretty helpful. I guess just one quick follow-up on the PVNBP Q4 specifically. So, my thinking on the JV was more that obviously Allianz was more life-heavy pre the JV. So, when that came in, does that mean that naturally your sort of share of a more life-heavy JV would skew the Q4 numbers? But it sounds like that's not the case. It sounds like it is a genuine increase in the underlying business that we can expect somewhat going forward. Is that the way to think about it?
That is the way to think about it, yeah.
Great. Very clear. Thank you.
Thanks very much.
Our next question comes from Warwick Bam of RMB Morgan Stanley.
Good afternoon, everyone on the call. I'll start with the question just on the SanlamAllianz merger and the impacts to GEV. In particular, you mentioned that the post-closing adjustments to calculate your ownership splits didn't include changes to the appraisal values of the businesses since 30 June 2021. I guess given that time period lapse, are they? Have you holding back on any fair value changes to the GEV, and would you consider the 31 December GEV a very accurate reflection of the business as it stands? Thanks. Okay.
Warwick, your voice came in and out, so I have to be 100% honest. I didn't follow your question from end to end. But Lotz, did you follow it from end to end? Yeah, Lotz followed it from end to end. Okay, why don't you go ahead?
Okay, I'll go ahead. So, I think Warwick, you let me start at the end. So, you asked, do we believe that the GEVs at the end of 31 December 2023 are accurate and the answer to and a true reflection of value? And the answer to that is they are indeed accurate and a true reflection of value. The impact of their take-on values from 30 June 2021 to 30 September 2023 was in the order of about ZAR 2.8 billion reduction in GEV because of the changes that were occasioned by currency movements, mainly in the two portfolios. So, it was ZAR 2.8 billion. ZAR 2 billion of that was for non-covered business, and around ZAR 800 million was for covered business. And we've reflected those impacts in our GEV as of 31 December 2023.
Actually, maybe just to Lotz, of course, I didn't hear the full question, but I think I know from your answer, I know what the question was. I think, Warwick, what is true is that the GEVs of the different businesses behave very much in line with expectations from the original date through to now. But there were very severe currency movements, particularly in the Egyptian pound. And actually, the Moroccan dirham as well, of course, moved the other way. But the underlying values of the business behaved very well.
Thanks.
Thank you. We have no further questions from the telephone lines at this stage.
Thanks very much, operator. I will come to the room. Anybody in the auditorium that has some questions? I don't see any questions in the auditorium, so I'll just come to the online questions that have been submitted. We've got three. I think one of them from Michael Christelis was relating to persistency, which we have dealt with. The second one from Michael Christelis was on the SPL strategy. And if you can expand on the strategy there.
Yeah, sure. So Michael, I hope you can hear us. So Sanlam Personal Loans is an unsecured retail credit product or business that was designed to provide unsecured loans to the Sanlam client base. And that business has been effectively run by FirstRand for something like well, it was DirectAxis originally acquired by FirstRand. And in total, I think they were the partners for roughly 20 years. A lot changes in 20 years.
We think that this is a business that needs to be moved into the digital age from the dinosaur age. You can understand that partnering somebody like FirstRand, who would be one of the leaders in South Africa in providing credit, is awkward because they effectively constrained how we could function. So our strategy is first to take on the business, which we started on the 1st of December. We've taken on the management team and the staff. The work that we're busy with at the moment is making sure that we get the credit provisions correct and that we also make sure that where there are accounts in arrears, that these are properly followed up and diligently managed. So it's very much a question of stabilizing the business initially.
And then we will look once we feel that we are totally on top of it from an IT credit scoring and management of the debt, we will begin selectively to expand that business, probably mainly in the digital arena. So I hope that answers that question. And the third question, Grant, from Michael?
The other question was from Baron and Comu from J.P. Morgan. Also a persistency-related question and more looking forward into 2024, the management actions taken and what the expected impact or negative impact on volumes in VNB from the actions we've taken in 2024 around persistency in the Retail Mass segment.
You can go, Lotz.
Okay, can go. Yeah. So as we've indicated in our results, based on the experience we had in 2023, we have taken some management actions, particularly to reduce the churn in our book. So the range of management actions relate to some changes to the remuneration model but also changes to taking measures to ensure that there is no rewards for replacement policies, which have got a consequence of churning our book. And therefore, you end up incurring costs twice for the same business. So, what that means going forward is those actions will improve the quality of business that we write, number one, and thereby improve persistency. But secondly, it means that in terms of new business volume generation, there'll be a dampening effect in terms of new business because you're no longer selling some of the replacement policies because you don't provide a reward for them.
What it means over time is the quality of the business and the file sales will then improve accordingly. So we do anticipate a slight reduction in volumes arising from those management actions. But we believe that from both a business and a client perspective, it's the right thing to do for us to take those actions.
Thanks very much, Lotz. I'll just like to come back to the room if there are any questions. I will ask you please to stand when you ask the questions. The television has asked us.
Hello. Ron Klipin, Cratos Asset Management. I'm just looking at your venture into the healthcare sector via the tie-up with AfroCentric. First of all, the benefits of that presumably on cross-sell of products, economies of scale. But the other thing which comes to mind is the regulation in that area is getting tighter and tighter with NHI and stuff like that. Do you ever see this becoming a significant part of your business, which is really going to move the dial? Or is this just something which is sort of an add-on?
Thanks very much. So I didn't catch your first name.
Okay. It's Ron, and the surname is Klipin, Cratos Asset Management.
Great, Ron. Sorry. Thanks very much for your question. So look, we don't believe that the health insurance business will ever be a mega business, if I could put it that way, inside Sanlam. And certainly, you saw Abigail classify life and health together, and it's a very small contributor, certainly at this point in time. And we don't believe it'll ever be a huge contributor. But having said that, it's a very important product line for almost all of our customers. And it's, of course, an incredibly emotive product line because you're dealing with people's health. And it is one with a relatively high level of engagement.
So many of our products that we sell, there's a lot of engagement upfront. Sadly, there's very little engagement until some calamity at the other end. If they're investment products, that may be a little bit different. Health products, of course, do have a feature of a high level of engagement. The great thing about it is it can help us to build engagement with customers. That engagement hopefully does lead, exactly as you say, to cross-sell and lowers the cost of acquisition, basically, of new customers. We see it as important, but as a line item itself and a profit contribution, it probably will never be tremendously large. I think that's fair to say.
Thank you very much.
Thanks very much. That does appear to be a question from the telephone lines. We'll now go back to the telephone lines operator.
Thank you, sir. Next question comes from Francois du Toit of Anchor Stockbrokers. Please go ahead.
Hi, guys. A few questions from my side. Thanks for the opportunity. The Allianz GEV contribution to net result from financial services appear to have been ZAR 930 million. Can you maybe just also quantify more or less the contribution to cash operating earnings and dividends also received from that entity? That's the first question. Second question, your group administration costs increased fairly meaningfully, I think, from about ZAR 550 million-ZAR 870 million without us seeing a big increase in the provision for the holding company expenses, the EV provision. Can we put those cost increases down as fairly one-off as a result? That's the second question. Third question, there's been a very big jump in earnings from India second half of the year. Is the level of earnings of the second half repeatable?
Maybe if you can just give a bit of color on the India earnings, quality of that earnings, and how much of that also included in what you define as cash earnings as well. So yeah, those are the three questions from my side at the moment.
Francois, thanks a lot. I think, Abigail, these are questions for you.
Yeah. Hi, Francois. Good to hear from you. I think maybe if I cover first, you asked about the San JV contribution. So the ZAR 900 and I think the number that you quoted, the ZAR 956, I think, that's the nine + three. So it would be the nine months in the old Pan-Africa business, obviously excluding Namibia, and then the three months in the new JV. You asked, what's the cash contribution? So you would see in terms of when I did the slide with the group numbers in terms of Net Result from Financial Services and the cash Net Result from Financial Services, they were very close. But obviously, given the structure that you have in terms of the Africa structure, the cash that we're counting there is still sitting either in-country or at a regional level.
So it's not necessarily reflected yet as dividends to the group because you had a question also, I think, to say what then is the dividend contribution. In terms of dividend contribution, in the short to medium term, we're seeing limited contributions. So let's say around, let's say, between 20%-40% in terms of contribution to the group. The main reasons for that being multiple factors, one being issues of currency and devaluation, impact of currency, repatriation, what you call repatriation limitations in some of the countries. But also, Pan-Africa is in a growth phase right now. We've said that we won't be injecting capital from South Africa. One would expect that Heinie and the team would most likely first invest or reinvest some of that capital to grow that portfolio.
In the short term, the dividend contribution to group from that business would be limited. I think we have communicated this previously. Then in terms of the group office costs, it is still a one-off, although it's going over, let's say, two reporting periods. If again I use the SanlamAllianz JV, just the process of getting regulatory approvals over just below 30 countries has taken us, what, 18 months, 20 months? That becomes quite costly in terms of legal fees, application processes, and whatnot. So over 2022 and 2023, we're still seeing a bit of an elevated, let's say, group office costs as relate to some of that M&A activity. And the same also flows through in the SanlamAllianz business.
But over and above the SanlamAllianz transaction, at group level, we showed or Paul showed with the slides that there's quite a lot of corporate activity that we're busy with, so a bit of legal and consulting fees there as well. And then in terms of the jump in India, is it a new base? We hope it's a base, and we hope that it goes even higher. Obviously, I think just overall, the prospects of India, the economic conditions of India are indicating that this should be a base. It should only move higher. But obviously, like anybody else, you can't really tell what's going to happen into the future. But we're very positive on the outlook of India.
Maybe, Abigail, just to add on India, we have a business that aims to grow at a lower rate than the competitors so that we have an emphasis on very high quality of business. And we run the balance sheet and the provisioning there very conservatively. So as much as the past is not a guide to the future, I think the ethos is that there's prudence built into how we operate. And that gives you some degree of confidence moving forward.
Operator.
Thanks, guys. Am I still live?
You are, Francois.
Excellent. One more question then for me. The EV statement impact of the Capitec deal that was ended, if you can maybe give us a bit of color around that, or that will be ended, sorry, in October, is it already fully taken into account in the EV statement? Obviously, there's also a reinsurance recapture income that'll still come through the income statement. But has that also been factored into the EV statement? Maybe if you just can quantify the EV statement impact. And where would that impact have emerged in this result set in the EV statement?
Hi, Francois. Yeah. So just the first question is, in the EV statement as at 31 December 2023, the impact of the termination of that Capitec JV, which will be effective later on in the year, is not in that EV statement. That EV statement reflects a business that's in force as at 31 December 2023. That business is still in force. Then in terms of the second question, when we do reflect the results for 2024, that termination would have occurred. And at that point, we'll then disclose what the impact on EV is.
Yeah. I mean, very simply put, you'll have an in-force value falling off, and you'll have a reinsurance capture premium coming in. And the difference between the two will represent, I don't know, an experience variance or something. Lotz will decide which bucket to stick it in.
That is correct.
Okay. That's interesting. You don't want to give us a sense of whether it'd be net positive or net negative?
No, no, Francois, not because we don't want to give you a sense. The impact of that event will report on it after it has happened.
Yeah. Thank you. But I did think the EV is also forward-looking. And insofar as you know about the cancellation, it would be taken into account in EV yet. But that's fine. Maybe one quick question still or comment. If you could give us a bit more information, maybe offline, on the contribution to EV earnings of Allianz. Given that it's still in EV, it is distorting my ability to value the rest of the rest of the businesses. And I don't think there's any Allianz life earnings and new business value disclosed in this result set.
Yes, Francois, we can give a lot more detail offline.
Thank you.
Operator, do we have any further questions from the telephone line?
No, sir. We have no further questions on the lines. Thank you.
Thank you. There's a question that has come through from the webcast. I can only pick up your surname, Bishop, from Excelsia Capital. Just picking up on the India story, growth has been very strongly the India business has grown very strongly. Would the business require any additional capital support going forward from Sanlam?
Yeah. So Grant, I think it's a good question. There is no question about the fact that if you take a long-run view, particularly on the credit business, the growth of that book, as well as ongoing changes to regulation, will ultimately mean that that business will likely need capital at some point in the future. Insurance businesses, I think, are a little bit different. They can certainly manage very high growth rates. The GI business, I always point out to people, is much more of an investment business in reality.
And so I think it's highly unlikely that it would need capital going forward. And of course, life businesses, once they're established under the Solvency II regime, are by and large self-financing for the kind of business that we write.
Thanks, Paul. Last question that's come through on the webcast from Jarred Houston from All Weather Capital, following on from the capital point. I think we did touch on it in our Assupol call. But Jarred's just asking about the discretionary capital position and how that develops over the year given all the deals, ins and outs.
Yeah. So Jarred, the answer to that, of course, is that we had a reduction in our discretionary capital by the year-end. This year, of course, as you point out, there's going to be the Assupol transaction, which will need a little bit more than the discretionary capital that we're sitting with. But we do have a number of anticipated inflows, not least of which we have to sell the Namibian business into the SanlamAllianz joint venture during the course of this year. And that's a given that that will happen. And then Allianz also have an option to acquire a further stake in the joint venture. That, of course, is an option, not an obligatory event. But as I said in my introduction, we have extremely low levels of gearing in the business. And something the size of an Allianz transaction is really very straightforward for us to finance.
Thanks very much, Paul. It looks like that's all from the webcast. Just one more sweep across the room. Doesn't look like there are any questions here, nor any questions from the telephone line as well. So with that, I just thank Paul, Abigail, and Lotz very much. And to everyone attending, both in the auditorium online as well and on the telephone call, thanks very much for attending. For those in the room, do join us for some refreshments afterwards. And we will leave it at that. Thank you very much for joining us.
Thanks. Thanks, Grant.