Good morning, good afternoon andgood evening to our global audience. Welcome to Prudential's third quarter 2007earnings conference call. [Operator Instructions] Let's get right to this third quarter agendahere with our opening remarks is Prudential's Head of Investor Relations, Mr.Eric Durant. Good morning sir and please go ahead.

Thank you very much and thanks to allof you for joining us today and belated Happy Halloween. We have alot to share with you today and we also look forward to entertaining yourquestions. Solet me getfirst into our forward looking statement. Inorder to help you to understand Prudential Financial, we will make some forwardlooking statements in thefollowing presentation. Itis possible that actual results may differ materially from thepredictions we make today. Additional information regarding factors that couldcause such adifference appears in thesection titled forward looking statements and Non-GAAP measures of our earningspress release for thethird quarter of 2007, which can befound on our website atwww.investor.prudential.com. In addition, in managing ourbusinesses, we use a Non-GAAP measure we call adjusted operating income tomeasure the performance of our financial services businesses. Adjustedoperating income excludes net investment gains and losses as adjusted andrelated charges and adjustments as well as results from divested businesses. Adjusted operating income also excludesrecorded changes in asset values that will ultimately accrue to contractholders and recorded changes in contract holder liabilities resulting fromchanges in related asset values. Thecomparable GAAP presentation and the reconciliation between the two for thethird quarter are set out in our earnings press release on our website.Additional historical information relating to the Company's financialperformance is also located on our website. Our first speaker is Art Ryan.

Thank you, good morning andwelcome. Our earnings for the third quarter of 2007 were Prudential's strongestever. They reflect solid performance across our portfolio of businesses. Based on adjusted operating income, earningsper share increased 15% compared to the third quarter of last year and are up29% for the year to date. As you know, we consider return onequity be to be the single best measure of Prudential Financial performance.Last year, our return on equity was 14.6% and we introduced a goal for the 2007to 2009 period to expand return on equity within the 15% to 17% range. We areon target, our ROE through September is 16.5% based on adjusted operatingincome. Excluding the impact of unusual or potentially non-recurring items, ourreturn on equity for the year to date would still be nearly 16%. Our growth and increased financialreturns reflect underlying improvement in the capabilities and performance ofeach of our businesses. Our risk management and asset management skills coupledwith disciplined capital management and expanding distribution support ourimproving returns and strong strategic positioning. Because unsettled marketconditions, especially in credit markets, characterized the third quarter, riskmanagement is a subject I will turn to again. Dislocations in financial marketsare, of course, a fact of life for financial institutions. As we discussearnings, you will hear how our earnings have been affected by a variety offinancial market developments. Our results are very good. We are managingeffectively in this environment. At Prudential, risk managementbegins with quality business models and diversification of risk. Prudential hasa portfolio of businesses that I believe is unusually diverse. Our businessesserve both individual and institutional clients. We operate in the United States and abroad, and we manage a broad setof insurance and market risks that to a great extent are uncorrelated. Weselect the particular risks we take carefully, based on our proven skill sets.For example,…

I will begin with an overview ofthird quarter adjusted operating income for the Financial Services Business. Asyou have seen from yesterday's release, we reported common stock earnings pershare for the Financial Services Business of $1.97 for the third quartercompared to $1.72 for the year ago quarter. This amounts to a 15% increase inearnings per share. Our core earnings performance wasstrong in the current quarter despite volatile conditions in financial markets.Third quarter results also reflected a net benefit of around $0.06 per sharefor several items that are of an unusual or nonrecurring nature. I will gothrough these items individually now. Our Individual Life, IndividualAnnuity and Group Insurance businesses completed their annual reviews ofexperience and actuarial assumptions in the third quarter. This resulted infavorable unlockings of DAC and other amortization items along with reserverefinements for a total contribution of about $0.18 per share. Our Individual Life businessreceived compensation based on multi year profitability of certain third partyproducts distributed by our agents contributing another $0.08 per share andresults for our International Investment segment included income from the saleof an interest in an operating JV, mark to market income on securities relatedto exchange memberships and a benefit from a recovery on a former investmentfor a total of about $0.12 per share. Now we also had a few items goingthe other way during the quarter. Our Retirement business recorded a pretaxcharge of $81 million or about $0.12 per share reflecting payments made toclients who authorized us to proceed on their behalf to seek recovery of losseson several investment funds managed by State Street Global Advisors. Additionally, several of our businessesrecorded mark to market losses within adjusted operating income amounting to$78 million pretax or $0.12 per share on externally managed fixed incomeinvestments in the European market. These investments contributed to ourportfolio of diversification since the underlying…

I will start with the Insurancedivision. Adjusted operating income for our Individual Life Insurance businesswas $247 million for the current quarter compared to $183 million a year ago. Current quarter results benefited from twoitems that Rich mentioned earlier, the DAC unlocking, which came mainly fromupdating our actuarial assumptions to give effect to mortality experience overa five year period contributed $78 million and compensation we received basedon multi year profitability of third party products distributed by our agentscontributed another $57 million. Results for the year ago quarterincluded similar benefits, $46 million from a favorable unlocking and $25million from compensation related to our distribution of third party products.Stripping out these items from the results, Individual Life's adjustedoperating income was unchanged from a year ago. Mortality experience was withinthe range of our current expectations, but less favorable than the year agothird quarter and this offset higher fees from growth in separate accountvalues. Sales, excluding COLI, amounted to$113 million in the current quarter, up $19 million or 20% from a year ago. Thesales increase came mainly from our term insurance products, which are up morethan 50% from a year ago. We arecontinuing to benefit from development of third party distributionrelationships, including direct response agents who specialize in terminsurance, as well as national and regional brokerage organizations. In addition, we improved our competitiveposition with the fine tuning of our term insurance pricing earlier this year,lowering the rates for term insurance cases of $1 million or more in selectedunderwriting categories while raising rates for some smaller face amountpolicies. Sales of Universal Life alsoincreased from a year ago, but are below the level of the past severalquarters. We are maintaining our vigilance to screen out stranger owned lifeinsurance cases, especially in this market. Our Prudential agent and third partydistribution channels each registered sales increases of roughly 20%…

The International Insurance segmentreported adjusted operating income of $366 million for the current quartercompared to $397 million a year ago. The segment's results include adjustedoperating income of $153 million from Gibraltar Life in the current quartercompared to $149 million a year ago. The increase in Gibraltar Life came mainlyfrom improved investment income margins and lower expenses. Sales fromGibraltar Life based on annualized premiums in constant dollars were $100million for the current quarter compared to $98 million a year ago. Sales of our US dollar fixedannuity product through Gibraltar's bank channel contributed just $5 million tocurrent quarter sales compared to $20 million a year ago when we benefited frominitial demand following the product introduction in that channel. Life advisor sales were $95 millionin the current quarter, up 22% from a year ago. In this channel, sales of our USdollar fixed annuity tend to rise when the Yen strengthens in relation to thedollar as the product is perceived as more attractive by life advisorcustomers. During the third quarter, the Yen did strengthen and greater USdollar fixed annuity sales contributed about half of the sales increase in ourlife advisor channel. The remainder of the increase came from sales oftraditional Japanese Yen based products. Gibraltar'slife advisor count stood at about 5,940 at the end of the third quarter,largely unchanged over the past few quarters. We hold our life advisors tominimum production standards based on semi annual evaluation periods and weexperienced some attrition of lower producers over the course of the year thusfar. At the same time, we continue to focus on quality of the field force andearlier this year, we reinforced our selection standards in hiring based on ourobservations about critical success factors. Our Life Planner business, theinternational insurance operations other than Gibraltar Life, reported adjustedoperating income of $213 million for the current quarter…

I am now going to comment on netincome and the investment portfolio. Net income for the Financial Services Businesswas $860 million for the third quarter compared to $1.2 billion a year ago.Current quarter results include pretax realized net investment losses of $109million net of related charges and adjustments. This compares to realized gainsof $221 million a year ago. The current quarter realized losses include $11million of impairments on asset backed securities collateralized by sub primemortgages. Credit related losses and impairments in total were $44 million inthe quarter. Also included in the $109 million of net realized losses were $67million of losses on sales of sub prime paper from roughly $650 million of bookvalue sold. These losses were a function of widening credit spreads in thatmarket rather than losses or downgrades. There has been no material changein our estimate of the potential credit losses that we mentioned in our secondquarter earnings conference call of $150 million after tax on sub primeholdings in stress scenarios. The scenarios assumed a 40% decline in thehousing prices underlying these securities. Our gross unrealized losses onfixed maturities in our general account stood at $1.5 billion at the end of thethird quarter. Of this amount, roughly $300 million relates to sub primeholdings, which amounted to $8 billion in total at September 30, 99% of our subprime holdings were priced as of quarter end using third party pricingservices. These underwrite realized losses essentially reflect widening ofcredit spreads. These holdings are substantially all investment grade withroughly 90% AAA and AA. We experienced very limited ratings downgrades in ourpositions from July 1 through the beginning of this week. Downgrades affected $47 million ofpar value, of our $8 billion of holdings and about half of the $8 billion arein a portfolio that we use to invest proceeds from securities lending,repurchase activities…

Thank you very much Mr. Ryan andour host panel, we appreciate that update and ladies and gentlemen as you justheard that this point we’re inviting your questions and comments for theexecutive team. [Operator Instructions]Representing Morgan Stanley, our first question we go to the line of NigelDally, please go ahead sir.

With your mortgage conduitoperations, have conditions for that group now stabilized or are there furtherpotential losses for mortgages you have in warehouse that we could be essentiallyfacing in the fourth quarter? Secondwith the retirement, seems to be taking longer until the sales and flows rampup. Can you discuss what gives you the confidence that you are still on trackfor improved performance there looking forward?

Let me take them in reverse orderif I can. So first with regard to the Retirement business, here is ourperspective, our first order of priority with the CIGNA integration was to integrateand stabilize, we’ve clearly done that, we’ve done that well and the 97% planparticipant persistency gives you a good feel for that. Our second order issue, which has now becomeour first order issue, is achieving sales momentum. Similar to Q2, Q3 wassofter than we would like and we are clearly not content with it, but we don'tsee anything systemic here that causes us concern. In a sense, the multiyear patternis what we expected, the slope of the line is not as steep as we would like.What I mean by that is we had negative flows in 05’, breakeven in 06’, year todate are modestly positive and we expect to do much better and we will. So in sum, we are getting the persistencythat we are seeking. We intend to achieve the sales and flows and we areconfident that we will and we are quite confident that we are on track to dothat, so that is on the retirement piece. On the mortgage conduit side, justto keep in mind, roughly half of the losses that arose from this spreadwidening were realized losses on securitization and the other half were themark to markets on the hedging instruments and on the associated loans. I think this is still a marketplace that isundergoing change in terms of activity levels so we really don't want tospeculate about where the market is going to go from here. Having said that, I would say though that, inour case, we have both the mortgage conduit on the one hand and a veryproactive general account origination on the other and what we have seen is alot of activity going back to the traditional lending activity as a consequenceof what’s gone on in the mortgage market.

That's great. Thank you.

Thank you very much Mr. Dally, andnext in queue is Tom Gallagher representing Credit Suisse. Please go ahead sir.

One quick follow up on Nigel's,then I have a couple of others. Can you comment on how big the warehousefacility is for CMBS?

Right now, there is $300 million ofloans and there is about $750 million of commitments and rate locks. So call it$1.1 billion, some of which is hedged.

Okay, thanks. Did that numberchange materially from last quarter?

No.

Okay. The other question I had was on;I guess the market value adjustment in Japanof $53 million. Can you explain a little bit further what exactly thoseinvestments are and how big that portfolio is that is subject to market valueinvestments that I guess would flow through net investment income?

I am going to make a couple ofcomments and then turn it over to Rich because I think you are also interestedin why the accounting treatment is what it is for that. The portfolio is a goodfit for what we do in Japanbecause we can adjust the maturity and the currency structure to fit ourliabilities. We also like thediversification into the European markets and from the perspective of thebusiness, the underlying investment is a credit related portfolio that looks alot like the same thing we do in the US. It happens to be in Europe and the wayin which it gets turned into a Yen denominated asset that creates theaccounting treatment and I'm going to let Rich talk about the dynamic of thatand why it is an AOI.

We hold, as Mark said, we hold a$1.8 billion basket of European credits in a structure that includes a notewith a fixed coupon and an embedded derivative. The embedded derivative isessentially a total return swap on the basket. We record the coupon on the noteas interest income, the mark to market on the swap is included in AOI as otherrevenue immediately, if it is in a loss. If the derivative is in a cumulativegain, the gain is amortized into AOI as other revenue over the remaining lifeof the note, essentially a yield adjustment. As spreads widened and rates rose,the swap lost value and we charged the loss to AOI in the period. That affectedseveral of our businesses as I had mentioned earlier.

So Tom, this is Art. it is $1.8billion. We have had this investment for about five years. As Mark mentioned,it is a very, very good match to our liabilities and the spread widening is awell known fact, of course, what has happened in the past quarter, but webelieve it is a very valuable investment.

Okay. That's helpful and justaverage credit rating of that basket, and I guess the imputed yield on anormalized basis. Is this kind of a below investment grade type exposure or isthat not necessarily the case?

Ninety percent is investment gradenow, there is a heavier weight on BBB than AAA, but 90% is investment grade.

You’d want to think about the yieldas you would an investment grade private. That is the typical yield on averagein the basket.

Okay. So bottom line is spreadsblew out, there was a negative mark on it and that’s really why we are seeingwhat we are for this third quarter?

The structure of the deal is why itis the unusual accounting treatment for this particular instrument and yes, butto answer your question, your summary is a good one.

Okay and then just one lastquestion if I could. On the Retirement business and potential exposure to thisissue of the DOL ruling on moving away from stable value as a default option, canyou just talk a little bit about how important the stable value option is toPRU within the Retirement business, earnings percentage that would be comingfrom stable value AUM in that area, and how you think that affects you goingforward?

Just a macro comment on that. Inour stable value, in our retirement services book, stable value representsroughly a third of our assets and it's very attractive and it's chosen by a lotof the clients because of the stability and their comfort level with that kindof an instrument. We don't see thedemand of that being driven by the default option. This is what clients havehistorically selected and we think will continue to select going forward whenthey are proactively doing it. So the presence or absence of the defaultoption, we don't think is a big factor, vis-à-vis the plan participant interestin this option.

Actually Tom, of $32 billion ofstable value balances, only about $2 billion were defaulted into, but you arequite right, in the aggregate, the earnings on the $32 billion of stable valuebalances, which represents about 30% of the entire portfolio, would roughjustice account for about twice the proportion of the earnings in the business.

Yes, in fact, the demographicswould suggest that stable value will always be attractive in that the defaultoption tended to be used much more frequently by younger and newer entrantsinto a plan and I think the Labor Department was driven on the fact of a needfor a more balanced approach if you will, a long stock market and the like foryounger employees to default into and there, we are well positioned as well aswe have those products in addition to the stable value ones.

Thanks a lot.

Thank you very much Mr. Gallagher.Next representing Sanford Bernstein, Suneet Kamath has our next question.

I just wanted to follow up again onNigel's full service accumulation question. John, I can appreciate that you areconfident that you're going to see the sales and the flows improve goingforward. I guess what I would like to hear more is why, in other words, you areobviously not generating the sales that you need to turn the flows positive, sothere must be something that is going to change in terms of your strategy and Iwas wondering if it is price, is it service, is it a better investment lineup,I mean something has to sort of cause that delta for the sales to recover and Iam just wondering what that is?

Well, I guess part of it is,Suneet, that there is a cycle time to this and so what we saw in Q2 and whatwe're seeing in Q3 is a product of our activity levels six months ago or so, andwe had a lower hit rate than we thought we should and we made a series ofadjustments, not so much pricing related, but a variety of more tactical thingsthat had given us confidence that the activity levels we can anticipate goingforward are considerably stronger than what they were from that time period. Itis a broader macro notion, but I want to make sure I'm conveying confidence inour prospects going forward because genuinely the feeling is there.

Okay. Thanks.

Thank you very much Mr. Kamath andAndrew Kligerman with UBS has our next question. Please go ahead sir.

Great, three questions. Just quicklyfollowing up on that, I am still not convinced that a cycle, so business willnaturally come to you in the retirement area because time is sort of runningits course. What competitive advantage do you bring to the table versus theothers out there? The second question would be aroundthe sub prime bonds that you sold or that exposure where you took the $67million net realized loss. If I understand correctly, you sold bonds worth $650million and you got that net loss of $67 million, so about a 10%, 15% loss, andyet Rich, you were talking about $150 million in losses I think over a five yearperiod relating to sub prime. Why the rush to sell such a big block and whysuch a big loss, I just can't quite reconcile that differential right there? Then just maybe a little coloraround what those agents in the Japanese banks are going to do. That soundsvery exciting.

Okay. Why don't we take them inreverse order? I'll let Mark talk about the agents and the changes going on in Japanin terms of bank assurance.

Yes, I'm glad you said it soundsvery exciting because I think it is. These agents will be seconded to the bankchannel through a range of banking relationship that we have, including verylarge, as well as regional banks and they will be selling life insurance whenit becomes approved by the regulators and we anticipate that before too long. So,this will be a big opportunity for us, and I think we are in a great spot withGibraltar and POJ, because we can do things in Gibraltar that don't conflictwith our Life Planner business in third party channel initiatives, and I'm veryoptimistic about where this opportunity may go.

I am going to ask Rich to answeryour question on sub prime.

We exercise judgment in managingall of our portfolios. We saw more value in other sub prime issues than theones we had. So we sold about 650 of the ones we felt were overvalued andbought positions we felt had upside. The $150 million estimate of potentialafter tax losses on sub prime, and those are potential after tax credit losses,was not a measure of market value changes during our ownership period. Theestimate of $150 million has not changed, and again our sales during thequarter reflected widening of credit spreads on these securities rather thandowngrades or defaults. So said another way, we sold into an illiquid marketand realized losses as we replaced selected securities with higher quality sub primepositions.

John, do you want to answer thequestion on retirement? I think you ought to sell more retirement so we don'tget as many questions on that one.

I am noticing a recurring theme, andAndrew, I didn't mean to give the impression that simply the passing of timewas what caused the optimism. I think we have competitive product, competitivecapabilities, we have management very, very focused on this. We obviously haveall the integration things behind us, and my comment about time was that, youknow, the things we're working on now are the things that show up in sixmonths' time in sales results, and just based on activity levels and the focusof our management, it gives me confidence about the future.

So its stuff like that LifetimeFive like product that you were mentioning earlier, that should have moreimpact down the road, got more wholesalers there, I mean that sort of stuff?

We have more marketingcapabilities. The product development piece on IncomeFlex, you know, is an addedfeature that we think will be perceived as being attractive, and we are justvery, very focused on this now. So I am not surprised by the questions and Iexpress confidence about our ability to deliver.

Okay. Thank you.

Thank you very much Mr. Kligerman.And representing JP Morgan, question now from Jimmy Bhullar. Please go aheadsir.

The first ones for I guess, Art, whendo you expect to disclose and what’s the timing of disclosing who the next CEOis, is that Investor Day or is it sometime next year, and when would the newperson take over? The second question is for Mark. OnLife Planner growth, I think this quarter it was 5% if you add back the peoplewho were transferred. Then it’s, or 3% reported, 5% with the transferredplanners. In the past, I think you haveaspired to do close to 10%, you haven't done 10% since the third quarter of 05’.The question is, is it realistic to assume that you will be able to grow yourLife Planner force in Japanby close to 10%, and if you don't, then would the sales growth be coming downversus where it has been in the past?

This is Art. The successiontimeframe is the same as I have been saying for the last year and half. TheBoard has been looking at this issue. I think they are quite confident. I wouldexpect that an announcement will be around the end of the year, not later thanJanuary. The timing is not yet determined, and that will be done simultaneouslywith the announcement on the succession. So it is still on track, nothinghas really changed.

On the Life Planner question, ouraspiration to grow at 10% is still in place. As you pointed out, we don'talways get there, but we have historically been pretty close and we havehistorically maintained the relationship between Life Planner growth and salespretty well, if you look over time, things bounce around quarter to quarter. Idon't see any reason to change that aspirational objective or the expectationthat over time we will get pretty close to it. We mentioned earlier that we cameinto this year with fewer sales managers in Japanthan we desired. That reflects the fact that becoming a sales manager relativeto a Life Planner is not always a decision that our Life Planners want to make.So we are doing some things to shore up the pipeline into sales managerpositions. With that will come the strength that we need in terms of numbers ofpeople to boost our Life Planner recruiting and maintain our Life Plannerretention. So we have initiatives underway inseveral aspects of what we do around both sales managers and Life Plannerrecruiting that I believe will move us a lot closer to on track over the nexttwo quarters. Nothing is going on in thisbusiness that is leading me to reconsider the longer term metrics that we havetalked about in terms of earnings growth and returns driven by the basicfundamentals of the Life Planner system.

Could you briefly comment on what’sgoing on in Korea,has the poaching, is that over, has the business turned the corner in terms ofrecruiting, if you could just briefly comment on that?

Well, the poaching has slowed down,and as I said in my prepared comments and we discussed last quarter, we havemade some changes in our compensation plans, which have been attractive to ourLife Planners and we have seen more stability there. We actually saw a smalldecrease this quarter because we appointed sales managers, again the same kindof need in the business to have sales managers. We appointed sales managersduring the third quarter. So, I think the phrase I used was it is probablyearly to declare victory, but we are seeing at least stability and somepositive indications around both market conditions, as well as the impact ofour management actions. So I believe Koreawill continue to be a more challenging market because it’s more dynamic, but weare getting ourselves on track.

Thanks.

Thank you very much Mr. Bhullar. Andnext question from Eric Berg with Lehman Brothers. Please go ahead sir.

Thanks very much. One of myquestions was answered, regarding the Life Planners just now, but I did haveone question regarding life sales for John Strangfeld. I think you were sayingthat you continue to be vigilant in screening out, my words not yours, but Ihope I am being faithful to your position, screening out, stranger owned lifeinsurance, and you ended by saying something on the lines of especially in thecurrent market. What is it about what’s going on right now in the market thatleads you to want to be especially vigilant?

I was recently at an ACLI meeting,and maybe I can add some color to that. There are a number of States wherevarious lobby and groups are looking to adjust insurable interest laws. That’sanother codeword for stranger owned life insurance. So, in an environment wherethere are groups that are proactively attempting to provide a rationale forthis particular product. I think that is where I have added and spoken withJohn and our agency system about extra diligence around stranger owned lifeinsurance. I don't necessarily see a particular up tick in volume, but I do seemore activity at the State level by those who are interested in changinginsurable interest laws.

That answers it. Thank you, Art.

Thank you very much Mr. Berg. AndTamara Kravec with Banc of America Securities has our next question. Please goahead.

Can you talk about where you think youstill have work to do on distribution in the annuities area and what thepotential may be for more block acquisitions in the future?

A couple of thoughts on that, oneis we think we have more potential in a couple of different areas. First, withregard to the Wire House Channel, we see broadly speaking more opportunitythere. We have relationships with these new Wire Houses, but we are still invarying degrees of development with regard to their, relative to theirpotential. We also see more opportunity in the Allstate channel, both vis-à-vistheir agents, as well as vis-à-vis the bank activities, the bank channels thatthey are focused on also. So, I think we are seeing considerable additionalpotential, vis-à-vis our distribution opportunities. Second part?

Acquisition of blocks.

Oh, acquisition of blocks. Well, asyou think about this, the business, the cost of being in this business from askill set point of view is going up as they are increasing orientation towardsthese lifetime benefits. Whether, it is the hedging costs and the technologyand the like, in our mind what that is going to mean is players that haverelatively modest books of business are going to conclude that it is notsomething they can effectively do or afford to do in a way that has the rightrisk management practices. So we think this is going to create otheropportunities for blocks of business, not unlike the situation with Allstate.

Okay, and the Universal Life sales,they have been declining sequentially, now for a couple of quarters. Can youjust update us, on your thoughts on the environment, and what sales trendsshould be in the near term?

Tamara, this is Eric. UniversalLife is actually the market that I think John was referring to. I am going backto Eric's question. There is a lot of premium finance going on now. We thinkthat is facilitating business that we don't want to be a part of. More broadly what you see here in UniversalLife, a lot of it is sold through third parties, and a lot of our third partybusiness tends to be relatively big ticket stuff, and the big ticket stufftends to be inherently volatile. So, you have got a lot of noise from quarterto quarter here, simply as a function of whether we write big ticket items thatquarter or not.

Okay. That's helpful. Thank you.

Thank you very much Ms. Kravec,well Mr. Ryan taking a quick look at the clock, it seems that we have time nowfor one more question. So, next in queue is Joan Zief, Goldman Sachs, please goahead ma’am.

Thank you very much. I have onebasic question and that is that given your high ROE and your ability tocontinue to generate enormous amounts of excess capital, do you think that PRUis really shifting more towards an asset management type of business wherethings are driven by fee income and returns on investment opportunities, andthen sort of as a follow up, when you think about the retirement areas, theasset management, your variable annuity, how much of the asset management isactually managed by PRU through proprietary asset management structures and howmuch is managed by outside third party managers?

In terms of the first, no, I thinkit does reflect the diversification we have, and where the activity is. I meanthere is no question that unit linked activities have been more the flavor overthe past four years, but we certainly are quite large as a global life insurerthat is not unit linked, certainly most of our business in Asia is not relatedto that, so we like the balance between being a significant asset manager, fee driven,while also having large exposure, if you will, in terms of mortality, growingexposure in longevity risk. So, if I look across the board at market rate,interest rate, mortality and longevity, I like the balance, because as we allknow, markets do change and we certainly don't want to be linked, if you will,to only one type of activity and I think our business mix allows us thatenormous flexibility to do that. In terms of the assets undermanagement, I think our total assets under management are just over $600billion, of which a bit over $400 billion are managed by Prudential entities, maybeit's a little bit higher than that.

About 80% is managed.

Yes, about 80% is managed byPrudential entities and the others is outside and that is predominantly in ourInternational Investment business, in terms of where we have some money beingmanaged. There is also, Rich, do you know where the other areas are?

Annuity separate accounts.

The separate accounts of theAnnuity business.

Retirements of DC plans.

About 80% of our total assets undermanagement are managed by Prudential entities.

Great, Thank you.

Thank you very much Ms. Zief andwith that, Mr. Ryan and our host panel, I will turn the call back you for anyclosing remarks.

I want to thank everyone for takingthe time to listen in and for those who asked the questions, thank you very,very much and we look forward to seeing you at our next quarterly call in a fewmonths. Have a good day.

Thank you, sir for those words andladies and gentlemen, [Operator Instructions] that does conclude our earningsrelease for this third quarter. Thank you very much for your participation.