The Prudential Series Fund

Pruco Life Insurance Company
Notes to Consolidated Financial Statements
3. INVESTMENTS (continued)
Investment Income and Investment Gains and Losses
Net investment income arose from the following sources for the years ended December 31:
2008 2007 2006
(in thousands)
Fixed maturities, available for sale $ 269,498 $ 283,526 $ 322,832
Policy loans 53,073 50,776 48,493
Commercial loans 49,786 37,174 22,662
Short term investments and cash equivalents 10,142 25,064 25,564
Other (1,181) 7,213 7,258
Gross investment income 381,318 403,753 426,809
Less: investment expenses (17,567) (22,359) (25,373)
Net investment income $ 363,751 $ 381,394 $ 401,436
Realized investment gains/ (losses), net including charges for other than temporary impairments, for the years ended December
31, were from the following sources:
2008 2007 2006
(in thousands)
Fixed maturities, available for sale $ (50,358) $ 5,159 $ (59,482)
Derivatives 260,027 (24,926) (2,437)
Commercial loans (3,656) (1,077) (1,168)
Equity securities, available for sale (22) 159 340
Other 215 2 (2)
Realized investment (losses)/gains, net $ 206,206 $ (20,683) $ (62,749)
Writedowns for impairments, which were deemed to be other than temporary for fixed maturities during 2008, 2007 and 2006
were $58 million, $3 million, and $1 million, respectively.
Commercial Loans
The Company’s commercial loans are comprised as follows as at December 31:
Amount
(in thousands)
2008 2007
% of
Amount
Total (in thousands)
% of
Total
Commercial mortgage loans by property type
Industrial buildings $ 199,366 22.6 % $ 178,873 23.9 %
Retail stores 163,289 18.5 % 119,528 15.9 %
Apartment complexes 147,744 16.8 % 129,559 17.3 %
Office buildings 159,606 18.1 % 131,557 17.5 %
Agricultural properties 66,518 7.5 % 67,049 8.9 %
Other 145,198 16.5 % 123,174 16.5 %
Total collateralized loans 881,721 100.0 % 749,740 100.0 %
Valuation allowance (8,173) (4,517)
Total net collateralized loans 873,548 745,223
Total other uncollaterized loans 8,090 -
Total commercial loans and other loans $ 881,638 $ 745,223
The commercial loans are geographically dispersed throughout the United States with the largest concentrations in California
(22%) and New Jersey (12%) at December 31, 2008.
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