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Share Name | Share Symbol | Market | Type |
---|---|---|---|
American Equity Investment Life Holding Company | NYSE:AEL | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 56.47 | 0 | 01:00:00 |
☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Iowa | 42-1447959 | |||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Common stock, par value $1 | AEL | New York Stock Exchange | ||||||||||||
Depositary Shares, each representing a 1/1,000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock, Series A | AELPRA | New York Stock Exchange | ||||||||||||
Depositary Shares, each representing a 1/1,000th interest in a share of 6.625% Fixed-Rate Reset Non-Cumulative Preferred Stock, Series B | AELPRB | New York Stock Exchange |
Large accelerated filer | ☒ | Accelerated filer | ☐ | ||||||||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | ||||||||
Emerging growth company | ☐ |
Page | |||||
AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY AND SUBSIDIARIES | |||||||||||
CONSOLIDATED BALANCE SHEETS | |||||||||||
(Dollars in thousands, except share and per share data) | |||||||||||
(Unaudited) | |||||||||||
March 31, 2023 | December 31, 2022 (a) | ||||||||||
Assets | |||||||||||
Investments: | |||||||||||
Fixed maturity securities, available for sale, at fair value (amortized cost of $43,784,431 as of 2023 and $44,866,019 as of 2022; allowance for credit losses of $2,047 as of 2023 and $3,347 as of 2022) | $ | 39,555,624 | $ | 39,804,617 | |||||||
Mortgage loans on real estate (net of allowance for credit losses of $45,626 as of 2023 and $36,972 as of 2022) | 7,199,225 | 6,949,027 | |||||||||
Real estate investments related to consolidated variable interest entities | 1,164,879 | 1,056,063 | |||||||||
Limited partnerships and limited liability companies (2023 and 2022 include $1,065,628 and $684,834 related to consolidated variable interest entities) | 1,657,415 | 1,266,779 | |||||||||
Derivative instruments | 684,033 | 431,727 | |||||||||
Other investments | 1,157,162 | 1,817,085 | |||||||||
Total investments | 51,418,338 | 51,325,298 | |||||||||
Cash and cash equivalents (2023 and 2022 include $39,016 and $27,235 related to consolidated variable interest entities) | 2,777,852 | 1,919,669 | |||||||||
Coinsurance deposits (net of allowance for credit losses of $5,334 as of 2023 and $8,737 as of 2022) | 13,710,877 | 13,254,956 | |||||||||
Market risk benefits | 230,304 | 229,871 | |||||||||
Accrued investment income (2023 and 2022 include $493 and $3,444 related to consolidated variable interest entities) | 497,425 | 497,851 | |||||||||
Deferred policy acquisition costs | 2,772,175 | 2,773,643 | |||||||||
Deferred sales inducements | 2,044,349 | 2,045,683 | |||||||||
Deferred income taxes | 290,648 | 438,434 | |||||||||
Income taxes recoverable | 50,821 | 55,498 | |||||||||
Other assets (2023 and 2022 include $19,349 and $10,690 related to consolidated variable interest entities) | 702,937 | 642,696 | |||||||||
Total assets | $ | 74,495,726 | $ | 73,183,599 | |||||||
AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY AND SUBSIDIARIES | |||||||||||
CONSOLIDATED BALANCE SHEETS | |||||||||||
(Dollars in thousands, except share and per share data) | |||||||||||
(Unaudited) | |||||||||||
March 31, 2023 | December 31, 2022 (a) | ||||||||||
Liabilities and Stockholders' Equity | |||||||||||
Liabilities: | |||||||||||
Policy benefit reserves | $ | 59,019,189 | $ | 58,781,836 | |||||||
Market risk benefits | 2,653,185 | 2,455,492 | |||||||||
Other policy funds and contract claims | 306,359 | 512,790 | |||||||||
Notes and loan payable | 790,413 | 792,073 | |||||||||
Subordinated debentures | 78,839 | 78,753 | |||||||||
Funds withheld for reinsurance liabilities | 6,984,409 | 6,577,426 | |||||||||
Other liabilities (2023 and 2022 include $127,519 and $78,644 related to consolidated variable interest entities) | 2,034,523 | 1,614,479 | |||||||||
Total liabilities | 71,866,917 | 70,812,849 | |||||||||
Stockholders' equity: | |||||||||||
Preferred stock, Series A; par value $1 per share; $400,000 aggregate liquidation preference; 20,000 shares authorized; issued and outstanding: 2023 and 2022 - 16,000 shares | 16 | 16 | |||||||||
Preferred stock, Series B; par value $1 per share; $300,000 aggregate liquidation preference; 12,000 shares authorized; issued and outstanding: 2023 and 2022 - 12,000 shares | 12 | 12 | |||||||||
Common stock; par value $1 per share; 200,000,000 shares authorized; issued and outstanding: 2023 - 77,753,194 shares (excluding 31,809,876 treasury shares); 2022 - 84,810,255 shares (excluding 24,590,353 treasury shares) | 77,753 | 84,810 | |||||||||
Additional paid-in capital | 1,045,453 | 1,325,316 | |||||||||
Accumulated other comprehensive loss | (3,036,429) | (3,746,230) | |||||||||
Retained earnings | 4,518,680 | 4,685,593 | |||||||||
Total stockholders' equity attributable to American Equity Investment Life Holding Company | 2,605,485 | 2,349,517 | |||||||||
Noncontrolling interests | 23,324 | 21,233 | |||||||||
Total stockholders' equity | 2,628,809 | 2,370,750 | |||||||||
Total liabilities and stockholders' equity | $ | 74,495,726 | $ | 73,183,599 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 (a) | ||||||||||
Revenues: | |||||||||||
Premiums and other considerations | $ | 4,137 | $ | 10,078 | |||||||
Annuity product charges | 62,591 | 52,355 | |||||||||
Net investment income | 561,323 | 567,423 | |||||||||
Change in fair value of derivatives | 45,890 | (477,519) | |||||||||
Net realized losses on investments | (27,787) | (13,127) | |||||||||
Other revenue | 16,394 | 8,817 | |||||||||
Total revenues | 662,548 | 148,027 | |||||||||
Benefits and expenses: | |||||||||||
Insurance policy benefits and change in future policy benefits (remeasurement gains (losses) of future policy benefit reserves of $354 for 2023 and $637 for 2022) | 7,208 | 13,615 | |||||||||
Interest sensitive and index product benefits | 57,911 | 287,917 | |||||||||
Market risk benefits (gains) losses | 183,694 | 191,893 | |||||||||
Amortization of deferred sales inducements | 46,601 | 45,085 | |||||||||
Change in fair value of embedded derivatives | 404,440 | (1,393,649) | |||||||||
Interest expense on notes and loan payable | 11,018 | 6,425 | |||||||||
Interest expense on subordinated debentures | 1,336 | 1,317 | |||||||||
Amortization of deferred policy acquisition costs | 68,235 | 72,969 | |||||||||
Other operating costs and expenses | 74,004 | 57,795 | |||||||||
Total benefits and expenses | 854,447 | (716,633) | |||||||||
Income (loss) before income taxes | (191,899) | 864,660 | |||||||||
Income tax expense (benefit) | (36,008) | 185,195 | |||||||||
Net income (loss) | (155,891) | 679,465 | |||||||||
Less: Net income available to noncontrolling interests | 103 | — | |||||||||
Net income (loss) available to American Equity Investment Life Holding Company stockholders | (155,994) | 679,465 | |||||||||
Less: Preferred stock dividends | 10,919 | 10,919 | |||||||||
Net income (loss) available to American Equity Investment Life Holding Company common stockholders | $ | (166,913) | $ | 668,546 | |||||||
Earnings (loss) per common share | $ | (2.00) | $ | 6.90 | |||||||
Earnings (loss) per common share - assuming dilution | $ | (2.00) | $ | 6.83 | |||||||
Weighted average common shares outstanding (in thousands): | |||||||||||
Earnings (loss) per common share | 83,417 | 96,866 | |||||||||
Earnings (loss) per common share - assuming dilution | 83,417 | 97,953 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 (a) | ||||||||||
Net income (loss) | $ | (155,891) | $ | 679,465 | |||||||
Other comprehensive income (loss): | |||||||||||
Change in net unrealized investment gains/losses | 851,731 | (4,015,830) | |||||||||
Change in current discount rate for liability for future policy benefits | (4,791) | 32,998 | |||||||||
Change in instrument-specific credit risk for market risk benefits | 70,005 | 480,410 | |||||||||
Reclassification of unrealized investment gains/losses to net income | (18,463) | 1,459 | |||||||||
Other comprehensive income (loss) before income tax | 898,482 | (3,500,963) | |||||||||
Income tax effect related to other comprehensive income (loss) | (188,681) | 734,906 | |||||||||
Other comprehensive income (loss) | 709,801 | (2,766,057) | |||||||||
Comprehensive income (loss) | $ | 553,910 | $ | (2,086,592) |
Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Noncontrolling Interest | Total Stockholders' Equity | |||||||||||||||||||||||||||||||||||
For the three months ended March 31, 2023 | |||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2022 | $ | 28 | $ | 84,810 | $ | 1,325,316 | $ | (3,746,230) | $ | 4,685,593 | $ | 21,233 | $ | 2,370,750 | |||||||||||||||||||||||||||
Net income (loss) for period | — | — | — | — | (155,994) | 103 | (155,891) | ||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | 709,801 | — | — | 709,801 | ||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | 9,904 | — | — | — | 9,904 | ||||||||||||||||||||||||||||||||||
Issuance of common stock | — | 211 | (3,842) | — | — | — | (3,631) | ||||||||||||||||||||||||||||||||||
Treasury stock acquired, common | — | (7,268) | (285,925) | — | — | — | (293,193) | ||||||||||||||||||||||||||||||||||
Dividends on preferred stock | — | — | — | — | (10,919) | — | (10,919) | ||||||||||||||||||||||||||||||||||
Contributions from noncontrolling interests | — | — | — | — | — | 1,988 | 1,988 | ||||||||||||||||||||||||||||||||||
Balance at March 31, 2023 | $ | 28 | $ | 77,753 | $ | 1,045,453 | $ | (3,036,429) | $ | 4,518,680 | $ | 23,324 | $ | 2,628,809 | |||||||||||||||||||||||||||
Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income | Retained Earnings | Noncontrolling Interest | Total Stockholders' Equity | |||||||||||||||||||||||||||||||||||
For the three months ended March 31, 2022 (a) | |||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | $ | 28 | $ | 92,514 | $ | 1,614,374 | $ | 3,192,547 | $ | 2,839,254 | $ | — | $ | 7,738,717 | |||||||||||||||||||||||||||
Net income for period | — | — | — | — | 679,465 | — | 679,465 | ||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | (2,766,057) | — | — | (2,766,057) | ||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | 5,596 | — | — | — | 5,596 | ||||||||||||||||||||||||||||||||||
Issuance of common stock | — | 6,958 | 244,580 | — | — | — | 251,538 | ||||||||||||||||||||||||||||||||||
Treasury stock acquired, common | — | (4,452) | (174,944) | — | — | — | (179,396) | ||||||||||||||||||||||||||||||||||
Dividends on preferred stock | — | — | — | — | (10,919) | — | (10,919) | ||||||||||||||||||||||||||||||||||
Contributions from noncontrolling interests | — | — | — | — | — | 1,084 | 1,084 | ||||||||||||||||||||||||||||||||||
Balance at March 31, 2022 | $ | 28 | $ | 95,020 | $ | 1,689,606 | $ | 426,490 | $ | 3,507,800 | $ | 1,084 | $ | 5,720,028 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 (a) | ||||||||||
Operating activities | |||||||||||
Net income (loss) | $ | (155,891) | $ | 679,465 | |||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||
Interest sensitive and index product benefits | 57,911 | 287,917 | |||||||||
Amortization of deferred sales inducements | 46,601 | 45,085 | |||||||||
Annuity product charges | (62,591) | (52,355) | |||||||||
Change in fair value of embedded derivatives | 404,440 | (1,393,649) | |||||||||
Change in traditional life and accident and health insurance reserves | 1,720 | (30,313) | |||||||||
Policy acquisition costs deferred | (66,767) | (56,897) | |||||||||
Amortization of deferred policy acquisition costs | 68,235 | 72,969 | |||||||||
Provision for depreciation and other amortization | 3,025 | 2,250 | |||||||||
Amortization of discounts and premiums on investments | 13,450 | (258) | |||||||||
Realized gains/losses on investments | 27,787 | 13,127 | |||||||||
Change in fair value of derivatives | (45,890) | 477,519 | |||||||||
Deferred income taxes | (40,895) | 184,840 | |||||||||
Share-based compensation | 9,904 | 5,596 | |||||||||
Change in accrued investment income | 426 | (38,805) | |||||||||
Change in income taxes recoverable/payable | 4,677 | 519 | |||||||||
Change in other assets | (34,940) | (11,927) | |||||||||
Change in other policy funds and contract claims | (207,895) | 197,191 | |||||||||
Change in market risk benefits, net | 192,253 | 197,617 | |||||||||
Change in collateral held for derivatives | 184,088 | (584,969) | |||||||||
Change in funds withheld from reinsurers | 342,602 | 80,767 | |||||||||
Change in other liabilities | 145,648 | 86,008 | |||||||||
Other | (22,855) | (61,765) | |||||||||
Net cash provided by operating activities | 865,043 | 99,932 | |||||||||
Investing activities | |||||||||||
Sales, maturities, or repayments of investments: | |||||||||||
Fixed maturity securities, available for sale | 3,150,639 | 1,779,328 | |||||||||
Mortgage loans on real estate | 279,348 | 536,216 | |||||||||
Derivative instruments | (132) | 280,510 | |||||||||
Other investments | 705,059 | 26,376 | |||||||||
Acquisitions of investments: | |||||||||||
Fixed maturity securities, available for sale | (2,039,525) | (3,924,643) | |||||||||
Mortgage loans on real estate | (534,632) | (585,867) | |||||||||
Real estate investments acquired | (120,907) | (168,088) | |||||||||
Derivative instruments | (205,561) | (185,486) | |||||||||
Other investments | (425,596) | (202,160) | |||||||||
Purchases of property, furniture and equipment | (4,192) | (2,424) | |||||||||
Net cash provided by (used in) investing activities | 804,501 | (2,446,238) |
Three Months Ended March 31, | |||||||||||
2023 | 2022 (a) | ||||||||||
Financing activities | |||||||||||
Receipts credited to annuity policyholder account balances | $ | 1,370,663 | $ | 888,488 | |||||||
Coinsurance deposits | (215,927) | 10,757 | |||||||||
Return of annuity policyholder account balances | (1,601,547) | (1,198,638) | |||||||||
Repayment of loan payable | (1,875) | — | |||||||||
Acquisition of treasury stock | (293,193) | (179,396) | |||||||||
Proceeds from issuance of common stock, net | (3,631) | 251,538 | |||||||||
Change in checks in excess of cash balance | (54,932) | 9,393 | |||||||||
Dividends paid on preferred stock | (10,919) | (10,919) | |||||||||
Net cash provided used in financing activities | (811,361) | (228,777) | |||||||||
Increase (decrease) in cash and cash equivalents | 858,183 | (2,575,083) | |||||||||
Cash and cash equivalents at beginning of period | 1,919,669 | 4,508,982 | |||||||||
Cash and cash equivalents at end of period | $ | 2,777,852 | $ | 1,933,899 | |||||||
Supplemental disclosures of cash flow information | |||||||||||
Cash paid during period for: | |||||||||||
Interest expense | $ | 5,803 | $ | 1,250 | |||||||
Income taxes | 262,020 | — | |||||||||
Income tax refunds received | 52,500 | — | |||||||||
Non-cash operating activity: | |||||||||||
Deferral of sales inducements | 45,267 | 23,446 | |||||||||
Liability for Future Policy Benefits for Payout Annuity With Life Contingency | |||||
(Dollars in thousands) | |||||
Pre-adoption 12/31/2020 balance | $ | 337,467 | |||
Adjustment to opening retained earnings for expected future policy benefits | 2,566 | ||||
Adjustment for the effect of remeasurement of liability at current single A rate | 68,717 | ||||
Post adoption 1/1/2021 balance | $ | 408,750 |
Market Risk Benefit Liability | |||||
(Dollars in thousands) | |||||
Pre-adoption 12/31/2020 carrying amount for features now classified as MRBs | $ | 2,547,231 | |||
Adjustment for the removal of shadow adjustments | (584,636) | ||||
Adjustment for the cumulative effect of the changes in the instrument-specific credit risk between the original contract issuance date and the transition date | 229,108 | ||||
Adjustment for the remaining difference between previous carrying amount and fair value measurement for the MRB, exclusive of the instrument specific credit risk | 33,781 | ||||
Post adoption 1/1/2021 MRB balance | $ | 2,225,484 |
Ceded Market Risk Benefit (a) | |||||
(Dollars in thousands) | |||||
Pre-adoption 12/31/2020 carrying amount for features now classified as MRBs | $ | 62,108 | |||
Adjustment for the difference between previous carrying amount and fair value measurement for the MRB, exclusive of the instrument specific credit risk | 27,230 | ||||
Post adoption 1/1/2021 ceded MRB balance | $ | 89,338 |
Deferred Policy Acquisition Costs | |||||
Fixed Index Annuities and Fixed Rate Annuities | |||||
(Dollars in thousands) | |||||
Pre-adoption 12/31/2020 balance | $ | 2,225,199 | |||
Adjustments for the removal of shadow adjustments | 1,183,306 | ||||
Post adoption 1/1/2021 balance | $ | 3,408,505 |
Deferred Sales Inducements | |||||
Fixed Index Annuities and Fixed Rate Annuities | |||||
(Dollars in thousands) | |||||
Pre-adoption 12/31/2020 balance | $ | 1,448,375 | |||
Adjustments for the removal of shadow adjustments | 768,310 | ||||
Post adoption 1/1/2021 balance | $ | 2,216,685 |
March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Assets | |||||||||||||||||||||||
Fixed maturity securities, available for sale | $ | 39,555,624 | $ | 39,555,624 | $ | 39,804,617 | $ | 39,804,617 | |||||||||||||||
Mortgage loans on real estate | 7,199,225 | 6,784,672 | 6,949,027 | 6,502,463 | |||||||||||||||||||
Real estate investments | 1,053,631 | 1,053,631 | 1,056,063 | 1,056,063 | |||||||||||||||||||
Limited partnerships and limited liability companies | 1,065,627 | 1,065,627 | 684,835 | 684,835 | |||||||||||||||||||
Derivative instruments | 684,033 | 684,033 | 431,727 | 431,727 | |||||||||||||||||||
Other investments | 1,157,162 | 1,157,162 | 1,817,085 | 1,817,085 | |||||||||||||||||||
Cash and cash equivalents | 2,777,852 | 2,777,852 | 1,919,669 | 1,919,669 | |||||||||||||||||||
Coinsurance deposits | 13,710,877 | 12,964,585 | 13,254,956 | 12,640,797 | |||||||||||||||||||
Market risk benefits | 230,304 | 230,304 | 229,871 | 229,871 | |||||||||||||||||||
Liabilities | |||||||||||||||||||||||
Policy benefit reserves | 58,655,544 | 55,469,740 | 58,419,911 | 55,572,896 | |||||||||||||||||||
Market risk benefits | 2,653,185 | 2,653,185 | 2,455,492 | 2,455,492 | |||||||||||||||||||
Single premium immediate annuity (SPIA) benefit reserves | 205,643 | 214,386 | 212,119 | 221,130 | |||||||||||||||||||
Other policy funds - FHLB | 100,000 | 100,000 | 300,000 | 300,000 | |||||||||||||||||||
Notes and loan payable | 790,413 | 794,615 | 792,073 | 774,220 | |||||||||||||||||||
Subordinated debentures | 78,839 | 88,336 | 78,753 | 87,293 | |||||||||||||||||||
Total Fair Value | NAV | Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
March 31, 2023 | |||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||
Fixed maturity securities, available for sale: | |||||||||||||||||||||||||||||
U.S. Government and agencies | $ | 177,878 | $ | — | $ | 29,978 | $ | 147,900 | $ | — | |||||||||||||||||||
States, municipalities and territories | 3,665,716 | — | — | 3,568,057 | 97,659 | ||||||||||||||||||||||||
Foreign corporate securities and foreign governments | 677,833 | — | — | 677,833 | — | ||||||||||||||||||||||||
Corporate securities | 23,401,001 | — | — | 23,025,704 | 375,297 | ||||||||||||||||||||||||
Residential mortgage backed securities | 1,355,858 | — | — | 1,355,858 | — | ||||||||||||||||||||||||
Commercial mortgage backed securities | 3,677,672 | — | — | 3,677,672 | — | ||||||||||||||||||||||||
Other asset backed securities | 6,599,666 | — | — | 5,791,438 | 808,228 | ||||||||||||||||||||||||
Other investments | 674,600 | — | 150,442 | 524,158 | — | ||||||||||||||||||||||||
Real estate investments | 1,053,631 | — | — | — | 1,053,631 | ||||||||||||||||||||||||
Limited partnerships and limited liability companies | 1,065,627 | 901,301 | — | — | 164,326 | ||||||||||||||||||||||||
Derivative instruments | 684,033 | — | — | 684,033 | — | ||||||||||||||||||||||||
Cash and cash equivalents | 2,777,852 | — | 2,777,852 | — | — | ||||||||||||||||||||||||
Market risk benefits (a) | 230,304 | — | — | — | 230,304 | ||||||||||||||||||||||||
$ | 46,041,671 | $ | 901,301 | $ | 2,958,272 | $ | 39,452,653 | $ | 2,729,445 | ||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||
Funds withheld liability - embedded derivative | $ | (377,484) | $ | — | $ | — | $ | — | $ | (377,484) | |||||||||||||||||||
Fixed index annuities - embedded derivatives | 4,905,133 | — | — | — | 4,905,133 | ||||||||||||||||||||||||
Market risk benefits (a) | 2,653,185 | — | — | — | 2,653,185 | ||||||||||||||||||||||||
$ | 7,180,834 | $ | — | $ | — | $ | — | $ | 7,180,834 | ||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||
Fixed maturity securities, available for sale: | |||||||||||||||||||||||||||||
U.S. Government and agencies | $ | 169,071 | $ | — | $ | 26,184 | $ | 142,887 | $ | — | |||||||||||||||||||
States, municipalities and territories | 3,822,982 | — | — | 3,822,982 | — | ||||||||||||||||||||||||
Foreign corporate securities and foreign governments | 676,852 | — | — | 676,852 | — | ||||||||||||||||||||||||
Corporate securities | 24,161,921 | — | — | 23,759,573 | 402,348 | ||||||||||||||||||||||||
Residential mortgage backed securities | 1,377,611 | — | — | 1,377,611 | — | ||||||||||||||||||||||||
Commercial mortgage backed securities | 3,687,478 | — | — | 3,687,478 | — | ||||||||||||||||||||||||
Other asset backed securities | 5,908,702 | — | — | 5,465,784 | 442,918 | ||||||||||||||||||||||||
Other investments | 1,013,297 | — | 398,280 | 615,017 | — | ||||||||||||||||||||||||
Real estate investments | 940,559 | — | — | — | 940,559 | ||||||||||||||||||||||||
Limited partnerships and limited liability companies | 684,835 | 620,626 | — | — | 64,209 | ||||||||||||||||||||||||
Derivative instruments | 431,727 | — | — | 431,727 | — | ||||||||||||||||||||||||
Cash and cash equivalents | 1,919,669 | — | 1,919,669 | — | — | ||||||||||||||||||||||||
Market risk benefits (a) | 229,871 | — | — | — | 229,871 | ||||||||||||||||||||||||
$ | 45,024,575 | $ | 620,626 | $ | 2,344,133 | $ | 39,979,911 | $ | 2,079,905 | ||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||
Funds withheld liability - embedded derivative | $ | (441,864) | $ | — | $ | — | $ | — | $ | (441,864) | |||||||||||||||||||
Fixed index annuities - embedded derivatives | 4,820,845 | — | — | — | 4,820,845 | ||||||||||||||||||||||||
Market risk benefits (a) | 2,455,492 | — | — | — | 2,455,492 | ||||||||||||||||||||||||
$ | 6,834,473 | $ | — | $ | — | $ | — | $ | 6,834,473 |
Average Lapse Rates | Average Partial Withdrawal Rates | |||||||||||||||||||||||||
Contract Duration (Years) | March 31, 2023 | December 31, 2022 | March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||
1 - 5 | 2.08% | 2.17% | 1.87% | 1.86% | ||||||||||||||||||||||
6 - 10 | 3.28% | 3.28% | 1.96% | 1.97% | ||||||||||||||||||||||
11 - 15 | 3.65% | 3.63% | 1.83% | 1.86% | ||||||||||||||||||||||
16 - 20 | 9.14% | 8.55% | 3.03% | 2.96% | ||||||||||||||||||||||
20+ | 4.92% | 4.90% | 1.81% | 1.81% |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Fixed maturity securities, available for sale - States, municipalities and territories | |||||||||||
Beginning balance | $ | — | $ | — | |||||||
Purchases and sales, net | — | — | |||||||||
Transfers in | 97,659 | — | |||||||||
Transfers out | — | — | |||||||||
Total realized/unrealized gains (losses) | |||||||||||
Included in net income | — | — | |||||||||
Included in other comprehensive income (loss) | — | — | |||||||||
Ending balance | $ | 97,659 | $ | — | |||||||
Fixed maturity securities, available for sale - Corporate securities | |||||||||||
Beginning balance | $ | 402,348 | $ | — | |||||||
Purchases and sales, net | (26,278) | — | |||||||||
Transfers in | 347 | — | |||||||||
Transfers out | — | — | |||||||||
Total realized/unrealized gains (losses): | |||||||||||
Included in net income | — | — | |||||||||
Included in other comprehensive income (loss) | (1,120) | — | |||||||||
Ending balance | $ | 375,297 | $ | — | |||||||
Fixed maturity securities, available for sale - Other asset backed securities | |||||||||||
Beginning balance | $ | 442,918 | $ | — | |||||||
Purchases and sales, net | 227,032 | — | |||||||||
Transfers in | 130,502 | — | |||||||||
Transfers out | — | — | |||||||||
Total realized/unrealized gains (losses): | |||||||||||
Included in net income | — | — | |||||||||
Included in other comprehensive income (loss) | 7,776 | — | |||||||||
Ending balance | $ | 808,228 | $ | — | |||||||
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Other investments | |||||||||||
Beginning balance | $ | — | $ | 6,349 | |||||||
Transfers in | — | — | |||||||||
Transfers out | — | — | |||||||||
Total realized/unrealized gains (losses): | |||||||||||
Included in net income | — | (2,482) | |||||||||
Included in other comprehensive income (loss) | — | — | |||||||||
Ending balance | $ | — | $ | 3,867 | |||||||
Real estate investments | |||||||||||
Beginning balance | $ | 940,559 | $ | 337,939 | |||||||
Purchases and sales, net | 120,908 | 109,835 | |||||||||
Change in fair value | (7,836) | 4,161 | |||||||||
Ending balance | $ | 1,053,631 | $ | 451,935 | |||||||
Limited partnerships and limited liability companies | |||||||||||
Beginning balance | $ | 64,209 | $ | — | |||||||
Purchases and sales, net | 94,137 | 58,253 | |||||||||
Change in fair value | 5,981 | — | |||||||||
Ending balance | $ | 164,327 | $ | 58,253 | |||||||
Funds withheld liability - embedded derivative | |||||||||||
Beginning balance | $ | (441,864) | $ | — | |||||||
Transfers in | — | — | |||||||||
Change in fair value | 64,380 | — | |||||||||
Ending balance | $ | (377,484) | $ | — | |||||||
Fixed index annuities - embedded derivatives | |||||||||||
Beginning balance | $ | 4,820,845 | $ | 7,964,961 | |||||||
Premiums less benefits | (121,181) | 114,077 | |||||||||
Change in fair value, net | 205,469 | (1,308,123) | |||||||||
Ending balance | $ | 4,905,133 | $ | 6,770,915 |
Amortized Cost (1) | Gross Unrealized Gains | Gross Unrealized Losses (2) | Allowance for Credit Losses | Fair Value | |||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
March 31, 2023 | |||||||||||||||||||||||||||||
Fixed maturity securities, available for sale: | |||||||||||||||||||||||||||||
U.S. Government and agencies | $ | 179,026 | $ | 1,060 | $ | (2,208) | $ | — | $ | 177,878 | |||||||||||||||||||
States, municipalities and territories | 4,066,597 | 52,221 | (453,102) | — | 3,665,716 | ||||||||||||||||||||||||
Foreign corporate securities and foreign governments | 738,759 | 12,943 | (73,869) | — | 677,833 | ||||||||||||||||||||||||
Corporate securities | 26,338,901 | 195,461 | (3,131,447) | (1,914) | 23,401,001 | ||||||||||||||||||||||||
Residential mortgage backed securities | 1,455,263 | 9,954 | (109,226) | (133) | 1,355,858 | ||||||||||||||||||||||||
Commercial mortgage backed securities | 4,088,679 | 1,125 | (412,132) | — | 3,677,672 | ||||||||||||||||||||||||
Other asset backed securities | 6,917,206 | 34,890 | (352,430) | — | 6,599,666 | ||||||||||||||||||||||||
$ | 43,784,431 | $ | 307,654 | $ | (4,534,414) | $ | (2,047) | $ | 39,555,624 | ||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||
Fixed maturity securities, available for sale: | |||||||||||||||||||||||||||||
U.S. Government and agencies | $ | 173,638 | $ | 70 | $ | (4,637) | $ | — | $ | 169,071 | |||||||||||||||||||
States, municipalities and territories | 4,356,251 | 41,565 | (574,834) | — | 3,822,982 | ||||||||||||||||||||||||
Foreign corporate securities and foreign governments | 748,770 | 11,661 | (83,579) | — | 676,852 | ||||||||||||||||||||||||
Corporate securities | 27,706,440 | 146,065 | (3,687,370) | (3,214) | 24,161,921 | ||||||||||||||||||||||||
Residential mortgage backed securities | 1,492,242 | 11,870 | (126,368) | (133) | 1,377,611 | ||||||||||||||||||||||||
Commercial mortgage backed securities | 4,098,755 | 493 | (411,770) | — | 3,687,478 | ||||||||||||||||||||||||
Other asset backed securities | 6,289,923 | 14,068 | (395,289) | — | 5,908,702 | ||||||||||||||||||||||||
$ | 44,866,019 | $ | 225,792 | $ | (5,283,847) | $ | (3,347) | $ | 39,804,617 |
Available for sale | |||||||||||
Amortized Cost | Fair Value | ||||||||||
(Dollars in thousands) | |||||||||||
Due in one year or less | $ | 702,112 | $ | 696,244 | |||||||
Due after one year through five years | 6,122,055 | 5,914,199 | |||||||||
Due after five years through ten years | 6,116,836 | 5,639,129 | |||||||||
Due after ten years through twenty years | 8,790,928 | 8,046,303 | |||||||||
Due after twenty years | 9,591,352 | 7,626,553 | |||||||||
31,323,283 | 27,922,428 | ||||||||||
Residential mortgage backed securities | 1,455,263 | 1,355,858 | |||||||||
Commercial mortgage backed securities | 4,088,679 | 3,677,672 | |||||||||
Other asset backed securities | 6,917,206 | 6,599,666 | |||||||||
$ | 43,784,431 | $ | 39,555,624 |
March 31, 2023 | December 31, 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Net unrealized losses on investments | $ | (4,232,154) | $ | (5,065,422) | |||||||
Deferred income tax valuation allowance reversal | 22,534 | 22,534 | |||||||||
Deferred income tax expense | 888,455 | 1,063,441 | |||||||||
Net unrealized losses reported as accumulated other comprehensive loss | $ | (3,321,165) | $ | (3,979,447) |
March 31, 2023 | December 31, 2022 | |||||||||||||||||||||||||
NAIC Designation | Amortized Cost | Fair Value | Amortized Cost | Fair Value | ||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||
1 | $ | 26,409,209 | $ | 24,052,838 | $ | 27,061,903 | $ | 24,211,086 | ||||||||||||||||||
2 | 16,575,461 | 14,833,109 | 17,023,157 | 14,944,131 | ||||||||||||||||||||||
3 | 629,526 | 537,044 | 595,193 | 510,392 | ||||||||||||||||||||||
4 | 151,368 | 116,504 | 109,409 | 91,495 | ||||||||||||||||||||||
5 | 7,171 | 7,595 | 61,721 | 36,738 | ||||||||||||||||||||||
6 | 11,696 | 8,534 | 14,636 | 10,775 | ||||||||||||||||||||||
$ | 43,784,431 | $ | 39,555,624 | $ | 44,866,019 | $ | 39,804,617 |
Less than 12 months | 12 months or more | Total | |||||||||||||||||||||||||||||||||
Fair Value | Unrealized Losses (1) | Fair Value | Unrealized Losses (1) | Fair Value | Unrealized Losses (1) | ||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||||
March 31, 2023 | |||||||||||||||||||||||||||||||||||
Fixed maturity securities, available for sale: | |||||||||||||||||||||||||||||||||||
U.S. Government and agencies | $ | 40,919 | $ | (905) | $ | 22,400 | $ | (1,303) | $ | 63,319 | $ | (2,208) | |||||||||||||||||||||||
States, municipalities and territories | 1,487,593 | (160,979) | 1,128,425 | (292,123) | 2,616,018 | (453,102) | |||||||||||||||||||||||||||||
Foreign corporate securities and foreign governments | 372,316 | (26,076) | 159,696 | (47,793) | 532,012 | (73,869) | |||||||||||||||||||||||||||||
Corporate securities | 10,860,843 | (1,149,693) | 7,844,602 | (1,981,754) | 18,705,445 | (3,131,447) | |||||||||||||||||||||||||||||
Residential mortgage backed securities | 730,911 | (45,375) | 368,307 | (63,851) | 1,099,218 | (109,226) | |||||||||||||||||||||||||||||
Commercial mortgage backed securities | 1,116,038 | (82,985) | 2,485,544 | (329,147) | 3,601,582 | (412,132) | |||||||||||||||||||||||||||||
Other asset backed securities | 1,701,535 | (68,465) | 3,050,769 | (283,965) | 4,752,304 | (352,430) | |||||||||||||||||||||||||||||
$ | 16,310,155 | $ | (1,534,478) | $ | 15,059,743 | $ | (2,999,936) | $ | 31,369,898 | $ | (4,534,414) | ||||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||||||||
Fixed maturity securities, available for sale: | |||||||||||||||||||||||||||||||||||
U.S. Government and agencies | $ | 160,201 | $ | (4,512) | $ | 908 | $ | (125) | $ | 161,109 | $ | (4,637) | |||||||||||||||||||||||
States, municipalities and territories | 2,595,122 | (537,313) | 95,184 | (37,521) | 2,690,306 | (574,834) | |||||||||||||||||||||||||||||
Foreign corporate securities and foreign governments | 522,826 | (76,957) | 21,816 | (6,622) | 544,642 | (83,579) | |||||||||||||||||||||||||||||
Corporate securities | 18,784,181 | (3,218,323) | 1,411,177 | (469,047) | 20,195,358 | (3,687,370) | |||||||||||||||||||||||||||||
Residential mortgage backed securities | 992,783 | (101,100) | 116,388 | (25,268) | 1,109,171 | (126,368) | |||||||||||||||||||||||||||||
Commercial mortgage backed securities | 2,941,293 | (302,513) | 651,923 | (109,257) | 3,593,216 | (411,770) | |||||||||||||||||||||||||||||
Other asset backed securities | 2,561,390 | (162,821) | 1,924,026 | (232,468) | 4,485,416 | (395,289) | |||||||||||||||||||||||||||||
$ | 28,557,796 | $ | (4,403,539) | $ | 4,221,422 | $ | (880,308) | $ | 32,779,218 | $ | (5,283,847) |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Fixed maturity securities available for sale carried at fair value | $ | 833,268 | $ | (4,014,371) | |||||||
Adjustment for effect on other balance sheet accounts: | |||||||||||
Deferred income tax asset/liability | (174,986) | 842,782 | |||||||||
(174,986) | 842,782 | ||||||||||
Change in net unrealized gains/losses on investments carried at fair value | $ | 658,282 | $ | (3,171,589) |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Available for sale fixed maturity securities: | |||||||||||
Gross realized gains | $ | 25,988 | $ | 3,465 | |||||||
Gross realized losses | (44,451) | (2,006) | |||||||||
Net credit loss (provision) release | (829) | (7,356) | |||||||||
(19,292) | (5,897) | ||||||||||
Other investments: | |||||||||||
Gross realized gains | 1,777 | — | |||||||||
Gross realized losses | (432) | — | |||||||||
1,345 | — | ||||||||||
Mortgage loans on real estate: | |||||||||||
Increase in allowance for credit losses | (8,654) | (5,245) | |||||||||
Recovery of specific allowance | — | — | |||||||||
Loss on sale of mortgage loans | (1,186) | (1,985) | |||||||||
(9,840) | (7,230) | ||||||||||
$ | (27,787) | $ | (13,127) |
Three Months Ended March 31, 2023 | |||||||||||||||||||||||
States, Municipalities and Territories | Corporate Securities | Residential Mortgage Backed Securities | Total | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Beginning balance | $ | — | $ | 3,214 | $ | 133 | $ | 3,347 | |||||||||||||||
Additions for credit losses not previously recorded | — | — | — | — | |||||||||||||||||||
Change in allowance on securities with previous allowance | — | (1,300) | — | (1,300) | |||||||||||||||||||
Ending balance | $ | — | $ | 1,914 | $ | 133 | $ | 2,047 | |||||||||||||||
Three Months Ended March 31, 2022 | |||||||||||||||||||||||
States, Municipalities and Territories | Corporate Securities | Residential Mortgage Backed Securities | Total | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Beginning balance | $ | 2,776 | $ | — | $ | 70 | $ | 2,846 | |||||||||||||||
Additions for credit losses not previously recorded | — | 3,825 | 336 | 4,161 | |||||||||||||||||||
Change in allowance on securities with previous allowance | (767) | — | 337 | (430) | |||||||||||||||||||
Ending balance | $ | 2,009 | $ | 3,825 | $ | 743 | $ | 6,577 |
March 31, 2023 | December 31, 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Commercial mortgage loans: | |||||||||||
Principal outstanding | $ | 3,570,314 | $ | 3,560,903 | |||||||
Deferred fees and costs, net | (6,407) | (6,345) | |||||||||
Amortized cost | 3,563,907 | 3,554,558 | |||||||||
Valuation allowance | (25,082) | (22,428) | |||||||||
Commercial mortgage loans, carrying value | 3,538,825 | 3,532,130 | |||||||||
Agricultural mortgage loans: | |||||||||||
Principal outstanding | 609,026 | 567,630 | |||||||||
Deferred fees and costs, net | (1,759) | (1,667) | |||||||||
Amortized cost | 607,267 | 565,963 | |||||||||
Valuation allowance | (1,356) | (1,021) | |||||||||
Agricultural mortgage loans, carrying value | 605,911 | 564,942 | |||||||||
Residential mortgage loans: | |||||||||||
Principal outstanding | 3,011,666 | 2,807,652 | |||||||||
Deferred fees and costs, net | 1,326 | 1,909 | |||||||||
Unamortized discounts and premiums, net | 60,685 | 55,917 | |||||||||
Amortized cost | 3,073,677 | 2,865,478 | |||||||||
Valuation allowance | (19,188) | (13,523) | |||||||||
Residential mortgage loans, carrying value | 3,054,489 | 2,851,955 | |||||||||
Mortgage loans, carrying value | $ | 7,199,225 | $ | 6,949,027 |
March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||
Principal | Percent | Principal | Percent | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Geographic distribution | |||||||||||||||||||||||
East | $ | 491,711 | 13.8 | % | $ | 502,659 | 14.1 | % | |||||||||||||||
Middle Atlantic | 279,732 | 7.8 | % | 280,993 | 7.9 | % | |||||||||||||||||
Mountain | 413,867 | 11.6 | % | 416,307 | 11.7 | % | |||||||||||||||||
New England | 75,432 | 2.1 | % | 73,631 | 2.1 | % | |||||||||||||||||
Pacific | 854,742 | 23.9 | % | 858,812 | 24.1 | % | |||||||||||||||||
South Atlantic | 949,734 | 26.6 | % | 934,007 | 26.2 | % | |||||||||||||||||
West North Central | 199,149 | 5.6 | % | 205,568 | 5.8 | % | |||||||||||||||||
West South Central | 305,947 | 8.6 | % | 288,926 | 8.1 | % | |||||||||||||||||
$ | 3,570,314 | 100.0 | % | $ | 3,560,903 | 100.0 | % | ||||||||||||||||
Property type distribution | |||||||||||||||||||||||
Office | $ | 369,223 | 10.3 | % | $ | 388,978 | 10.9 | % | |||||||||||||||
Retail | 858,628 | 24.0 | % | 896,351 | 25.2 | % | |||||||||||||||||
Industrial/Warehouse | 909,077 | 25.5 | % | 866,623 | 24.3 | % | |||||||||||||||||
Apartment | 1,029,694 | 28.8 | % | 912,984 | 25.6 | % | |||||||||||||||||
Hotel | 324,271 | 9.1 | % | 285,271 | 8.0 | % | |||||||||||||||||
Mixed Use/Other | 79,421 | 2.3 | % | 210,696 | 6.0 | % | |||||||||||||||||
$ | 3,570,314 | 100.0 | % | $ | 3,560,903 | 100.0 | % |
Three Months Ended March 31, 2023 | |||||||||||||||||||||||
Commercial | Agricultural | Residential | Total | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Beginning allowance balance | $ | (22,428) | $ | (1,021) | $ | (13,523) | $ | (36,972) | |||||||||||||||
Charge-offs | — | — | — | — | |||||||||||||||||||
Recoveries | — | — | — | — | |||||||||||||||||||
Change in provision for credit losses | (2,654) | (335) | (5,665) | (8,654) | |||||||||||||||||||
Ending allowance balance | $ | (25,082) | $ | (1,356) | $ | (19,188) | $ | (45,626) | |||||||||||||||
Three Months Ended March 31, 2022 | |||||||||||||||||||||||
Commercial | Agricultural | Residential | Total | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Beginning allowance balance | $ | (17,926) | $ | (519) | $ | (5,579) | $ | (24,024) | |||||||||||||||
Charge-offs | — | — | — | — | |||||||||||||||||||
Recoveries | — | — | — | — | |||||||||||||||||||
Change in provision for credit losses | (6,661) | (39) | 1,455 | (5,245) | |||||||||||||||||||
Ending allowance balance | $ | (24,587) | $ | (558) | $ | (4,124) | $ | (29,269) |
2023 | 2022 | 2021 | 2020 | 2019 | Prior | Total | |||||||||||||||||||||||||||||||||||
As of March 31, 2023: | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||
Commercial mortgage loans | |||||||||||||||||||||||||||||||||||||||||
Current | $ | 7,788 | $ | 461,509 | $ | 600,590 | $ | 479,951 | $ | 581,416 | $ | 1,432,653 | $ | 3,563,907 | |||||||||||||||||||||||||||
30 - 59 days past due | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
60 - 89 days past due | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Over 90 days past due | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Total commercial mortgage loans | $ | 7,788 | $ | 461,509 | $ | 600,590 | $ | 479,951 | $ | 581,416 | $ | 1,432,653 | $ | 3,563,907 | |||||||||||||||||||||||||||
Agricultural mortgage loans | |||||||||||||||||||||||||||||||||||||||||
Current | $ | 41,988 | $ | 195,288 | $ | 153,023 | $ | 172,036 | $ | 5,589 | $ | 34,000 | $ | 601,924 | |||||||||||||||||||||||||||
30 - 59 days past due | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
60 - 89 days past due | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Over 90 days past due | — | — | 5,343 | — | — | — | 5,343 | ||||||||||||||||||||||||||||||||||
Total agricultural mortgage loans | $ | 41,988 | $ | 195,288 | $ | 158,366 | $ | 172,036 | $ | 5,589 | $ | 34,000 | $ | 607,267 | |||||||||||||||||||||||||||
Residential mortgage loans | |||||||||||||||||||||||||||||||||||||||||
Current | $ | 224,031 | $ | 2,003,711 | $ | 562,310 | $ | 194,720 | $ | 27,631 | $ | 1,330 | $ | 3,013,733 | |||||||||||||||||||||||||||
30 - 59 days past due | — | 16,627 | 2,516 | 4,960 | 57 | 417 | 24,577 | ||||||||||||||||||||||||||||||||||
60 - 89 days past due | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Over 90 days past due | — | 7,452 | 16,155 | 7,385 | 1,580 | 2,795 | 35,367 | ||||||||||||||||||||||||||||||||||
Total residential mortgage loans | $ | 224,031 | $ | 2,027,790 | $ | 580,981 | $ | 207,065 | $ | 29,268 | $ | 4,542 | $ | 3,073,677 | |||||||||||||||||||||||||||
2022 | 2021 | 2020 | 2019 | 2018 | Prior | Total | |||||||||||||||||||||||||||||||||||
As of December 31, 2022: | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||
Commercial mortgage loans | |||||||||||||||||||||||||||||||||||||||||
Current | $ | 425,875 | $ | 592,468 | $ | 486,339 | $ | 591,076 | $ | 416,132 | $ | 1,042,668 | $ | 3,554,558 | |||||||||||||||||||||||||||
30 - 59 days past due | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
60 - 89 days past due | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Over 90 days past due | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Total commercial mortgage loans | $ | 425,875 | $ | 592,468 | $ | 486,339 | $ | 591,076 | $ | 416,132 | $ | 1,042,668 | $ | 3,554,558 | |||||||||||||||||||||||||||
Agricultural mortgage loans | |||||||||||||||||||||||||||||||||||||||||
Current | $ | 196,347 | $ | 160,641 | $ | 166,211 | $ | 5,629 | $ | 34,000 | $ | — | $ | 562,828 | |||||||||||||||||||||||||||
30 - 59 days past due | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
60 - 89 days past due | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Over 90 days past due | — | — | 3,135 | — | — | — | 3,135 | ||||||||||||||||||||||||||||||||||
Total agricultural mortgage loans | $ | 196,347 | $ | 160,641 | $ | 169,346 | $ | 5,629 | $ | 34,000 | $ | — | $ | 565,963 | |||||||||||||||||||||||||||
Residential mortgage loans | |||||||||||||||||||||||||||||||||||||||||
Current | $ | 1,915,169 | $ | 595,363 | $ | 211,119 | $ | 27,483 | $ | 1,710 | $ | 417 | $ | 2,751,261 | |||||||||||||||||||||||||||
30 - 59 days past due | 39,179 | 8,238 | 13,073 | 1,960 | — | — | 62,450 | ||||||||||||||||||||||||||||||||||
60 - 89 days past due | 6,668 | 7,165 | 3,034 | 57 | — | — | 16,924 | ||||||||||||||||||||||||||||||||||
Over 90 days past due | 9,702 | 14,068 | 6,515 | 1,762 | 2,796 | — | 34,843 | ||||||||||||||||||||||||||||||||||
Total residential mortgage loans | $ | 1,970,718 | $ | 624,834 | $ | 233,741 | $ | 31,262 | $ | 4,506 | $ | 417 | $ | 2,865,478 |
March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||
Total Assets | Total Liabilities | Total Assets | Total Liabilities | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Real estate investments | $ | 1,221,622 | $ | 127,087 | $ | 1,095,267 | $ | 78,244 | |||||||||||||||
Real estate limited liability companies | 65,776 | 243 | 66,258 | 287 | |||||||||||||||||||
Limited partnership funds | 901,367 | 189 | 620,741 | 113 | |||||||||||||||||||
Infrastructure limited liability companies | 100,600 | — | — | — | |||||||||||||||||||
$ | 2,289,365 | $ | 127,519 | $ | 1,782,266 | $ | 78,644 |
March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||
Asset Carrying Value | Maximum Exposure to Loss | Asset Carrying Value | Maximum Exposure to Loss | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Fixed maturity securities, available for sale | $ | 1,493,364 | $ | 1,493,364 | $ | 1,178,110 | $ | 1,178,110 | |||||||||||||||
March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||
Notional | Fair Value | Notional | Fair Value | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Derivatives designated as hedging instruments | |||||||||||||||||||||||
Assets | |||||||||||||||||||||||
Derivative instruments | |||||||||||||||||||||||
Interest rate swaps | $ | 408,369 | $ | 19,778 | $ | 408,369 | $ | 32,769 | |||||||||||||||
Derivatives not designated as hedging instruments | |||||||||||||||||||||||
Assets | |||||||||||||||||||||||
Derivative instruments | |||||||||||||||||||||||
Call options | $ | 39,005,998 | $ | 664,255 | $ | 38,927,534 | $ | 397,789 | |||||||||||||||
Warrants | — | — | 2,020 | 1,169 | |||||||||||||||||||
$ | 39,005,998 | $ | 664,255 | $ | 38,929,554 | $ | 398,958 | ||||||||||||||||
Liabilities | |||||||||||||||||||||||
Policy benefit reserves - annuity products | |||||||||||||||||||||||
Fixed index annuities - embedded derivatives, net | $ | 4,905,133 | $ | 4,820,845 | |||||||||||||||||||
Funds withheld for reinsurance liabilities | |||||||||||||||||||||||
Reinsurance related embedded derivative | (377,484) | (441,864) | |||||||||||||||||||||
$ | 4,527,649 | $ | 4,378,981 |
Line Item in the Consolidated Balance Sheets in Which Hedged Item is Included | Amortized Cost of Hedged Item | Cumulative Amount of Fair Value Basis Adjustment Gain (Loss) | ||||||||||||||||||||||||
March 31, 2023 | December 31, 2022 | March 31, 2023 | December 31, 2022 | |||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||
Fixed maturities, available for sale: | ||||||||||||||||||||||||||
Current hedging relationships | $ | 389,904 | $ | 389,060 | $ | (25,011) | $ | (39,128) | ||||||||||||||||||
Discontinued hedging relationships | 1,333,176 | 1,594,736 | (79,031) | (94,681) |
Derivative | Hedged Item | Net | Amount Excluded: Recognized in Income Immediately | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
For the three months ended March 31, 2023 | |||||||||||||||||||||||
Interest rate swaps | $ | (12,991) | $ | 14,116 | $ | 1,125 | $ | — | |||||||||||||||
For the three months ended March 31, 2022 | |||||||||||||||||||||||
Interest rate swaps | $ | — | $ | — | $ | — | $ | — |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Change in fair value of derivatives: | |||||||||||
Call options | $ | 43,444 | $ | (478,448) | |||||||
Warrants | 1,321 | 929 | |||||||||
$ | 44,765 | $ | (477,519) | ||||||||
Change in fair value of embedded derivatives: | |||||||||||
Fixed index annuities - embedded derivatives | $ | 205,469 | $ | (1,308,123) | |||||||
Other changes in difference between policy benefit reserves computed using derivative accounting (ASC 815) vs. insurance contracts accounting (ASC 944) | 134,591 | 116,918 | |||||||||
Reinsurance related embedded derivative | 64,380 | (202,444) | |||||||||
$ | 404,440 | $ | (1,393,649) |
March 31, 2023 | December 31, 2022 | |||||||||||||||||||||||||||||||||||||
Counterparty | Credit Rating (S&P) | Credit Rating (Moody's) | Notional Amount | Fair Value | Notional Amount | Fair Value | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||
Bank of America | A+ | Aa2 | $ | 3,913,403 | $ | 45,365 | $ | 3,574,125 | $ | 26,080 | ||||||||||||||||||||||||||||
Barclays | A | A1 | 2,910,246 | 60,478 | 3,686,896 | 39,657 | ||||||||||||||||||||||||||||||||
Canadian Imperial Bank of Commerce | A+ | Aa2 | 2,442,141 | 54,020 | 2,707,734 | 34,218 | ||||||||||||||||||||||||||||||||
Citibank, N.A. | A+ | Aa3 | 4,132,309 | 49,853 | 3,748,162 | 29,873 | ||||||||||||||||||||||||||||||||
Credit Suisse | A- | A3 | 2,074,458 | 36,903 | 2,086,470 | 20,691 | ||||||||||||||||||||||||||||||||
J.P. Morgan | A+ | Aa2 | 6,153,747 | 78,007 | 6,501,103 | 69,006 | ||||||||||||||||||||||||||||||||
Mizuho | A | A1 | 691,141 | 19,273 | — | — | ||||||||||||||||||||||||||||||||
Morgan Stanley | A+ | Aa3 | 2,569,596 | 36,543 | 2,957,389 | 38,470 | ||||||||||||||||||||||||||||||||
Royal Bank of Canada | AA- | A1 | 4,595,241 | 102,189 | 4,378,132 | 58,026 | ||||||||||||||||||||||||||||||||
Societe Generale | A | A1 | 2,460,528 | 36,410 | 2,099,081 | 17,157 | ||||||||||||||||||||||||||||||||
Truist | A | A2 | 2,142,918 | 49,287 | 1,960,787 | 32,885 | ||||||||||||||||||||||||||||||||
Wells Fargo | A+ | Aa2 | 5,200,545 | 113,323 | 5,436,824 | 61,840 | ||||||||||||||||||||||||||||||||
Exchange traded | 128,094 | 2,382 | 199,200 | 2,655 | ||||||||||||||||||||||||||||||||||
$ | 39,414,367 | $ | 684,033 | $ | 39,335,903 | $ | 430,558 |
Three Months Ended March 31, 2023 | |||||||||||||||||
Fixed Index Annuities | Fixed Rate Annuities | Single Premium Immediate Annuities | |||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Balance, beginning of year | $ | 2,649,322 | $ | 120,105 | $ | 4,216 | |||||||||||
Capitalizations | 54,803 | 11,949 | 16 | ||||||||||||||
Amortization expense | (60,801) | (7,247) | (188) | ||||||||||||||
Balance, end of period | $ | 2,643,324 | $ | 124,807 | $ | 4,044 |
Year Ended December 31, 2022 | |||||||||||||||||
Fixed Index Annuities | Fixed Rate Annuities | Single Premium Immediate Annuities | |||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Balance, beginning of year | $ | 2,906,684 | $ | 151,322 | $ | 4,198 | |||||||||||
Write-off related to in-force ceded reinsurance | (196,417) | (7,209) | — | ||||||||||||||
Capitalizations | 193,988 | 4,424 | 663 | ||||||||||||||
Amortization expense | (254,933) | (28,432) | (645) | ||||||||||||||
Balance, end of period | $ | 2,649,322 | $ | 120,105 | $ | 4,216 |
Deferred Policy Acquisitions Costs | |||||||||||
March 31, 2023 | December 31, 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Fixed Index Annuities | $ | 2,643,324 | $ | 2,649,322 | |||||||
Fixed Rate Annuities | 124,807 | 120,105 | |||||||||
Single Premium Immediate Annuities | 4,044 | 4,216 | |||||||||
Total | $ | 2,772,175 | $ | 2,773,643 |
Three Months Ended March 31, 2023 | |||||||||||
Fixed Index Annuities | Fixed Rate Annuities | ||||||||||
(Dollars in thousands) | |||||||||||
Balance, beginning of year | $ | 2,017,960 | $ | 27,723 | |||||||
Capitalizations | 45,266 | — | |||||||||
Amortization expense | (45,786) | (814) | |||||||||
Balance, end of period | $ | 2,017,440 | $ | 26,909 |
Year Ended December 31, 2022 | |||||||||||
Fixed Index Annuities | Fixed Rate Annuities | ||||||||||
(Dollars in thousands) | |||||||||||
Balance, beginning of year | $ | 2,088,591 | $ | 31,370 | |||||||
Capitalizations | 107,683 | 8 | |||||||||
Amortization expense | (178,314) | (3,655) | |||||||||
Balance, end of period | $ | 2,017,960 | $ | 27,723 |
Deferred Sales Inducements | |||||||||||
March 31, 2023 | December 31, 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Fixed Index Annuities | $ | 2,017,440 | $ | 2,017,960 | |||||||
Fixed Rate Annuities | 26,909 | 27,723 | |||||||||
Total | $ | 2,044,349 | $ | 2,045,683 |
Present Value of Expected Future Policy Benefits | |||||||||||
Three Months Ended March 31, 2023 | Year Ended December 31, 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Balance, beginning of year | $ | 317,418 | $ | 401,022 | |||||||
Beginning balance at original discount rate | 341,071 | 351,575 | |||||||||
Effect of changes in cash flow assumptions | — | 1,280 | |||||||||
Effect of actual variances from expected experience | (354) | (1,958) | |||||||||
Adjusted beginning of year balance | 340,717 | 350,897 | |||||||||
Issuances | 2,874 | 15,766 | |||||||||
Interest accrual | 3,548 | 14,613 | |||||||||
Benefit payments | — | — | |||||||||
Derecognition (lapses) | (9,818) | (40,205) | |||||||||
Ending balance at original discount rate | 337,321 | 341,071 | |||||||||
Effect of changes in discount rate assumptions | (18,859) | (23,653) | |||||||||
Balance, end of period | $ | 318,462 | $ | 317,418 |
March 31, 2023 | December 31, 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Liability for future policy benefits | $ | 319,895 | $ | 318,677 | |||||||
Deferred profit liability | 19,341 | 19,084 | |||||||||
339,236 | 337,761 | ||||||||||
Less: Reinsurance recoverable | (1,433) | (1,259) | |||||||||
Net liability for future policy benefits, after reinsurance recoverable | $ | 337,803 | $ | 336,502 |
March 31, 2023 | December 31, 2022 | ||||||||||
SPIA With Life Contingency: | |||||||||||
Weighted-average liability duration of the liability for future policy benefits (years) | 7.58 | 6.78 | |||||||||
March 31, 2023 | December 31, 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
SPIA With Life Contingency: | |||||||||||
Expected future benefit payments | $ | 462,201 | $ | 467,627 | |||||||
Expected future gross premiums | — | — | |||||||||
Three Months Ended March 31, 2023 | Year Ended December 31, 2022 | ||||||||||||||||||||||
Gross Premiums or Assessments | Interest Expense | Gross Premiums or Assessments | Interest Expense | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Liability for future policy benefits | $ | 3,391 | $ | 3,548 | $ | 16,994 | $ | 14,613 | |||||||||||||||
Total | $ | 3,391 | $ | 3,548 | $ | 16,994 | $ | 14,613 |
March 31, 2023 | December 31, 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Interest accretion rate | 4.26 | % | 4.25 | % | |||||||
Current discount rate | 4.95 | % | 5.37 | % |
Three Months Ended March 31, 2023 | Year Ended December 31, 2022 | ||||||||||||||||||||||
Fixed Rate Annuities | Fixed Index Annuities | Fixed Rate Annuities | Fixed Index Annuities | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
MRB Liability | |||||||||||||||||||||||
Balance, beginning of year | $ | 37,863 | $ | 2,187,758 | $ | 78,411 | $ | 2,557,379 | |||||||||||||||
Balance, beginning of year, before effect of changes in the instrument-specific credit risk | 44,355 | 2,453,169 | 77,732 | 2,310,436 | |||||||||||||||||||
Issuances | — | 44,841 | 376 | 59,452 | |||||||||||||||||||
Interest accrual | 607 | 36,217 | 1,349 | 72,551 | |||||||||||||||||||
Attributed fees collected | 302 | 30,041 | 1,270 | 125,168 | |||||||||||||||||||
Benefits payments | — | — | — | — | |||||||||||||||||||
Effect of changes in interest rates | 2,973 | 172,165 | (19,421) | (952,265) | |||||||||||||||||||
Effect of changes in equity markets | — | (16,573) | — | 186,618 | |||||||||||||||||||
Effect of changes in equity index volatility | — | (7,760) | — | 241,563 | |||||||||||||||||||
Actual policyholder behavior different from expected behavior | — | — | — | — | |||||||||||||||||||
Effect of changes in future expected policyholder behavior | 714 | 3,738 | 602 | 46,567 | |||||||||||||||||||
Effect of changes in other future expected assumptions | — | — | (17,553) | 363,079 | |||||||||||||||||||
Balance, end of year, before effect of changes in the instrument-specific credit | 48,951 | 2,715,838 | 44,355 | 2,453,169 | |||||||||||||||||||
Effect of changes in the instrument-specific credit risk | (7,795) | (334,113) | (6,492) | (265,411) | |||||||||||||||||||
Balance, end of year | 41,156 | 2,381,725 | 37,863 | 2,187,758 | |||||||||||||||||||
Reinsured MRB, end of period | 11,463 | 674,239 | 10,656 | 593,959 | |||||||||||||||||||
Balance, end of period, net of reinsurance | $ | 29,693 | $ | 1,707,486 | $ | 27,207 | $ | 1,593,799 | |||||||||||||||
Net amount at risk (a) | $ | 262,643 | $ | 11,120,564 | $ | 258,826 | $ | 10,987,198 | |||||||||||||||
Weighted average attained age of contract holders (years) | 69 | 71 | 69 | 71 |
March 31, 2023 | |||||||||||||||||
Asset | Liability | Net Liability | |||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Fixed Index Annuities | $ | 226,747 | $ | 2,608,472 | $ | 2,381,725 | |||||||||||
Fixed Rate Annuities | 3,557 | 44,713 | 41,156 | ||||||||||||||
Total | $ | 230,304 | $ | 2,653,185 | $ | 2,422,881 |
December 31, 2022 | |||||||||||||||||
Asset | Liability | Net Liability | |||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Fixed Index Annuities | $ | 226,294 | $ | 2,414,052 | $ | 2,187,758 | |||||||||||
Fixed Rate Annuities | 3,577 | 41,440 | 37,863 | ||||||||||||||
Total | $ | 229,871 | $ | 2,455,492 | $ | 2,225,621 |
Three Months Ended March 31, 2023 | Year Ended December 31, 2022 | ||||||||||||||||||||||
Fixed Rate Annuities | Fixed Index Annuities | Fixed Rate Annuities | Fixed Index Annuities | ||||||||||||||||||||
Ceded MRB | (Dollars in thousands) | ||||||||||||||||||||||
Balance, beginning of year | $ | 10,656 | $ | 593,959 | $ | — | $ | 156,931 | |||||||||||||||
Write-off related to in-force ceded reinsurance | — | — | 10,091 | 334,835 | |||||||||||||||||||
Issuances | — | 32,744 | — | 36,036 | |||||||||||||||||||
Interest accrual | 128 | 7,136 | 104 | 7,598 | |||||||||||||||||||
Attributed fees collected | 7 | 6,106 | 28 | 23,745 | |||||||||||||||||||
Benefits payments | — | — | — | — | |||||||||||||||||||
Effect of changes in interest rates | 603 | 40,846 | 135 | (171,948) | |||||||||||||||||||
Effect of changes in equity markets | — | (7,043) | 118 | 43,799 | |||||||||||||||||||
Effect of changes in equity index volatility | — | (2,021) | — | 34,278 | |||||||||||||||||||
Actual policyholder behavior different from expected behavior | — | — | — | — | |||||||||||||||||||
Effect of changes in future expected policyholder behavior | 69 | 2,512 | 180 | 12,598 | |||||||||||||||||||
Effect of changes in other future expected assumptions | — | — | — | 116,087 | |||||||||||||||||||
Balance, end of year | $ | 11,463 | $ | 674,239 | $ | 10,656 | $ | 593,959 | |||||||||||||||
Net amount at risk (a) | $ | 73,259 | $ | 2,419,275 | $ | 72,350 | $ | 2,402,964 | |||||||||||||||
Weighted average attained age of contract holders (years) | 70 | 71 | 70 | 71 |
March 31, 2023 | |||||||||||||||||
Asset | Liability | Net Asset | |||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Fixed Index Annuities | $ | 712,734 | $ | 38,495 | $ | 674,239 | |||||||||||
Fixed Rate Annuities | 11,884 | 421 | 11,463 | ||||||||||||||
Total | $ | 724,618 | $ | 38,916 | $ | 685,702 |
December 31, 2022 | |||||||||||||||||
Asset | Liability | Net Asset | |||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Fixed Index Annuities | $ | 629,611 | $ | 35,652 | $ | 593,959 | |||||||||||
Fixed Rate Annuities | 11,070 | 414 | 10,656 | ||||||||||||||
Total | $ | 640,681 | $ | 36,066 | $ | 604,615 |
March 31, 2023 | |||||||||||||||||||||||||||||
Fair Value | Valuation Technique | Significant Inputs and Assumptions | Range | Weighted Average | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||
Market risk benefits | $ | 2,422,881 | Discounted cash flow | Utilization (a) | 0.04% - 78.75% | 4.18% | |||||||||||||||||||||||
Ceded market risk benefits | 685,702 | Option budget (b) | 1.65% - 2.50% | 2.31% | |||||||||||||||||||||||||
Risk-free interest rate (c) | 2.35% - 4.72% | 3.01% | |||||||||||||||||||||||||||
Nonperformance risk (d) | 0.55% - 3.49% | 2.71% | |||||||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||
Fair Value | Valuation Technique | Significant Inputs and Assumptions | Range | Weighted Average | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||
Market risk benefits | $ | 2,225,621 | Discounted cash flow | Utilization (a) | 0.04% - 78.75% | 4.24% | |||||||||||||||||||||||
Ceded market risk benefits | 604,615 | Option budget (b) | 1.65% - 2.50% | 2.31% | |||||||||||||||||||||||||
Risk-free interest rate (c) | 2.51% - 4.90% | 3.31% | |||||||||||||||||||||||||||
Nonperformance risk (d) | 0.06% - 3.27% | 2.59% | |||||||||||||||||||||||||||
Three Months Ended March 31, 2023 | Year Ended December 31, 2022 | ||||||||||||||||||||||
Fixed Rate Annuities | Fixed Index Annuities | Fixed Rate Annuities | Fixed Index Annuities | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Balance, beginning of year | $ | 6,589,577 | $ | 53,808,184 | $ | 6,860,060 | $ | 55,001,391 | |||||||||||||||
Issuances | 407,249 | 926,058 | 159,570 | 2,986,223 | |||||||||||||||||||
Premiums received | 526 | 35,046 | 4,811 | 170,493 | |||||||||||||||||||
Policy charges | (2,100) | (75,223) | (6,587) | (272,604) | |||||||||||||||||||
Surrenders and withdrawals | (180,822) | (1,213,070) | (574,590) | (3,945,504) | |||||||||||||||||||
Benefit payments | (3,290) | (203,524) | (11,328) | (727,847) | |||||||||||||||||||
Interest credited | 38,884 | 83,963 | 151,762 | 598,639 | |||||||||||||||||||
Other | (482) | (313) | 5,879 | (2,607) | |||||||||||||||||||
Balance, end of period | $ | 6,849,542 | $ | 53,361,121 | $ | 6,589,577 | $ | 53,808,184 | |||||||||||||||
Weighted-average crediting rate | 2.32 | % | 0.63 | % | 2.28 | % | 1.11 | % | |||||||||||||||
Net amount at risk (a) | $ | 262,643 | $ | 11,120,564 | $ | 258,826 | $ | 10,987,198 | |||||||||||||||
Cash surrender value | $ | 6,456,292 | $ | 49,205,688 | $ | 6,208,597 | $ | 49,551,657 |
March 31, 2023 | December 31, 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Fixed index annuities policyholder account balances | $ | 53,361,121 | $ | 53,808,184 | |||||||
Fixed rate annuities policyholder account balances | 6,849,542 | 6,589,577 | |||||||||
Embedded derivative adjustment (b) | (1,576,129) | (1,996,640) | |||||||||
Liability for future policy benefits | 319,895 | 318,677 | |||||||||
Deferred profit liability | 19,341 | 19,084 | |||||||||
Other | 45,419 | 42,954 | |||||||||
Total | $ | 59,019,189 | $ | 58,781,836 |
March 31, 2023 | |||||||||||||||||||||||||||||||||||
Range of guaranteed minimum crediting rate | At guaranteed minimum | 1 to 50 | 51 to 150 | Greater than 150 basis points above | Total | ||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||||
Fixed Index Annuities | 0.00% - 0.50% | $ | — | $ | 545,301 | $ | 443,724 | $ | 406,824 | $ | 1,395,849 | ||||||||||||||||||||||||
0.50% - 1.00% | 2,449,974 | 1,104,836 | 2,251,001 | 89,954 | 5,895,765 | ||||||||||||||||||||||||||||||
1.00% - 1.50% | 50,601 | 9,347 | — | — | 59,948 | ||||||||||||||||||||||||||||||
1.50% - 2.00% | 57 | — | — | — | 57 | ||||||||||||||||||||||||||||||
2.00% - 2.50% | 132,027 | 91,276 | 8 | — | 223,311 | ||||||||||||||||||||||||||||||
2.50% - 3.00% | 905,663 | — | — | — | 905,663 | ||||||||||||||||||||||||||||||
Greater than 3.00% | — | — | — | — | — | ||||||||||||||||||||||||||||||
Allocated to index strategies | — | — | — | — | 44,880,528 | ||||||||||||||||||||||||||||||
Total | $ | 3,538,322 | $ | 1,750,760 | $ | 2,694,733 | $ | 496,778 | $ | 53,361,121 | |||||||||||||||||||||||||
Fixed Rate Annuities | 0.00% - 0.50% | $ | — | $ | — | $ | — | $ | 101 | $ | 101 | ||||||||||||||||||||||||
0.50% - 1.00% | 55,547 | 201,007 | 3,995,398 | 1,014,260 | 5,266,212 | ||||||||||||||||||||||||||||||
1.00% - 1.50% | 453,063 | 232 | — | — | 453,295 | ||||||||||||||||||||||||||||||
1.50% - 2.00% | 278,374 | 93,402 | 271,181 | 190 | 643,147 | ||||||||||||||||||||||||||||||
2.00% - 2.50% | 18,985 | 23 | — | — | 19,008 | ||||||||||||||||||||||||||||||
2.50% - 3.00% | 406,972 | 7,304 | — | — | 414,276 | ||||||||||||||||||||||||||||||
Greater than 3.00% | 53,503 | — | — | — | 53,503 | ||||||||||||||||||||||||||||||
Total | $ | 1,266,444 | $ | 301,968 | $ | 4,266,579 | $ | 1,014,551 | $ | 6,849,542 |
December 31, 2022 | |||||||||||||||||||||||||||||||||||
Range of guaranteed minimum crediting rate | At guaranteed minimum | 1 to 50 | 51 to 150 | Greater than 150 basis points above | Total | ||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||||
Fixed Index Annuities | 0.00% - 0.50% | $ | — | $ | 462,356 | $ | 407,031 | $ | 315,324 | $ | 1,184,711 | ||||||||||||||||||||||||
0.50% - 1.00% | 2,421,244 | 1,098,332 | 2,258,992 | 77,901 | 5,856,469 | ||||||||||||||||||||||||||||||
1.00% - 1.50% | 51,586 | 9,391 | — | — | 60,977 | ||||||||||||||||||||||||||||||
1.50% - 2.00% | 57 | — | — | — | 57 | ||||||||||||||||||||||||||||||
2.00% - 2.50% | 133,059 | 100,205 | 8 | — | 233,272 | ||||||||||||||||||||||||||||||
2.50% - 3.00% | 939,684 | — | — | — | 939,684 | ||||||||||||||||||||||||||||||
Greater than 3.00% | — | — | — | — | — | ||||||||||||||||||||||||||||||
Allocated to index strategies | 45,533,014 | ||||||||||||||||||||||||||||||||||
Total | $ | 3,545,630 | $ | 1,670,284 | $ | 2,666,031 | $ | 393,225 | $ | 53,808,184 | |||||||||||||||||||||||||
Fixed Rate Annuities | 0.00% - 0.50% | $ | — | $ | — | $ | — | $ | 61 | $ | 61 | ||||||||||||||||||||||||
0.50% - 1.00% | 55,458 | 203,523 | 4,000,203 | 701,836 | 4,961,020 | ||||||||||||||||||||||||||||||
1.00% - 1.50% | 454,728 | 231 | — | — | 454,959 | ||||||||||||||||||||||||||||||
1.50% - 2.00% | 281,694 | 96,767 | 277,053 | 189 | 655,703 | ||||||||||||||||||||||||||||||
2.00% - 2.50% | 21,887 | 22 | — | — | 21,909 | ||||||||||||||||||||||||||||||
2.50% - 3.00% | 434,042 | 7,417 | — | — | 441,459 | ||||||||||||||||||||||||||||||
Greater than 3.00% | 54,466 | — | — | — | 54,466 | ||||||||||||||||||||||||||||||
Total | $ | 1,302,275 | $ | 307,960 | $ | 4,277,256 | $ | 702,086 | $ | 6,589,577 |
March 31, 2023 | December 31, 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Senior notes due 2027 | |||||||||||
Principal | $ | 500,000 | $ | 500,000 | |||||||
Unamortized debt issue costs | (2,811) | (2,960) | |||||||||
Unamortized discount | (169) | (178) | |||||||||
Term loan due 2027 | |||||||||||
Principal | 300,000 | 300,000 | |||||||||
Principal paydown | (5,625) | (3,750) | |||||||||
Unamortized debt issue costs | (982) | (1,039) | |||||||||
$ | 790,413 | $ | 792,073 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands, except per share data) | |||||||||||
Numerator: | |||||||||||
Net income (loss) available to common stockholders - numerator for earnings (loss) per common share | $ | (166,913) | $ | 668,546 | |||||||
Denominator: | |||||||||||
Weighted average common shares outstanding | 83,416,966 | 96,866,125 | |||||||||
Effect of dilutive securities: | |||||||||||
Stock options and deferred compensation agreements | 597,119 | 612,265 | |||||||||
Restricted stock and restricted stock units | 737,283 | 474,923 | |||||||||
Antidilutive impact due to net loss | (1,334,402) | — | |||||||||
Denominator for earnings (loss) per common share - assuming dilution | 83,416,966 | 97,953,313 | |||||||||
Earnings (loss) per common share | $ | (2.00) | $ | 6.90 | |||||||
Earnings (loss) per common share - assuming dilution | $ | (2.00) | $ | 6.83 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Average yield on invested assets | 4.48% | 4.15% | |||||||||
Aggregate cost of money | 1.81% | 1.64% | |||||||||
Aggregate investment spread | 2.67% | 2.51% | |||||||||
Impact of: | |||||||||||
Investment yield - additional prepayment income | —% | 0.03% | |||||||||
Cost of money benefit from over hedging | —% | 0.03% |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
American Equity Investment Life Insurance Company: | |||||||||||
Fixed index annuities | $ | 735,839 | $ | 755,980 | |||||||
Annual reset fixed rate annuities | 693 | 1,062 | |||||||||
Multi-year fixed rate annuities | 156,034 | 2,345 | |||||||||
Single premium immediate annuities | 427 | 13,453 | |||||||||
892,993 | 772,840 | ||||||||||
Eagle Life Insurance Company: | |||||||||||
Fixed index annuities | 228,599 | 126,754 | |||||||||
Annual reset fixed rate annuities | 1,269 | 7 | |||||||||
Multi-year fixed rate annuities | 248,229 | 2,340 | |||||||||
478,097 | 129,101 | ||||||||||
Consolidated: | |||||||||||
Fixed index annuities | 964,438 | 882,734 | |||||||||
Annual reset fixed rate annuities | 1,962 | 1,069 | |||||||||
Multi-year fixed rate annuities | 404,263 | 4,685 | |||||||||
Single premium immediate annuities | 427 | 13,453 | |||||||||
Total before coinsurance ceded | 1,371,090 | 901,941 | |||||||||
Coinsurance ceded | 637,999 | 213,563 | |||||||||
Net after coinsurance ceded | $ | 733,091 | $ | 688,378 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Reconciliation from net income (loss) available to common stockholders to non-GAAP operating income available to common stockholders: | |||||||||||
Net income (loss) available to American Equity Investment Life Holding Company common stockholders | $ | (166,913) | $ | 668,546 | |||||||
Adjustments to arrive at non-GAAP operating income available to common stockholders: | |||||||||||
Net realized losses on financial assets, including credit losses | 24,384 | 13,725 | |||||||||
Change in fair value of derivatives and embedded derivatives | 206,202 | (847,207) | |||||||||
Capital markets impact on the change in fair value of market risk benefits | 136,950 | 118,913 | |||||||||
Net investment income | (2,491) | — | |||||||||
Other revenue | 5,969 | — | |||||||||
Income taxes | (79,765) | 153,090 | |||||||||
Non-GAAP operating income available to common stockholders | $ | 124,336 | $ | 107,067 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Surrender charges | $ | 26,542 | $ | 15,541 | |||||||
Lifetime income benefit riders (LIBR) fees | 36,049 | 36,814 | |||||||||
$ | 62,591 | $ | 52,355 | ||||||||
Withdrawals from annuity policies subject to surrender charges | $ | 460,767 | $ | 267,336 | |||||||
Average surrender charge collected on withdrawals subject to surrender charges | 5.8 | % | 5.8 | % | |||||||
Fund values on policies subject to LIBR fees | $ | 4,300,875 | $ | 4,558,943 | |||||||
Weighted average per policy LIBR fee | 0.84 | % | 0.81 | % |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Call options: | |||||||||||
Gain (loss) on option expiration | $ | (152,884) | $ | 51,787 | |||||||
Change in unrealized gains/losses | 196,328 | (530,235) | |||||||||
Warrants | 1,321 | 929 | |||||||||
Interest rate swaps | 1,125 | — | |||||||||
$ | 45,890 | $ | (477,519) |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
S&P 500 Index | |||||||||||
Point-to-point strategy | 0.0% - 0.0% | 0.6% - 12.5% | |||||||||
Monthly average strategy | 0.0% - 0.0% | 1.0% - 8.6% | |||||||||
Monthly point-to-point strategy | 0.0% - 0.0% | 0.0% - 12.9% | |||||||||
Volatility control index point-to-point strategy | 0.0% - 1.3% | 0.0% - 7.3% | |||||||||
Fixed income (bond index) strategies | 0.0% - 6.0% | 0.0% - 5.1% |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Asset liability management fees | $ | 5,991 | $ | 2,905 | |||||||
Amortization of deferred gain | 10,403 | 5,912 | |||||||||
$ | 16,394 | $ | 8,817 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Index credits on index policies | $ | 3,533 | $ | 224,385 | |||||||
Interest credited (including changes in minimum guaranteed interest for fixed index annuities) | 54,378 | 63,532 | |||||||||
$ | 57,911 | $ | 287,917 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Fixed index annuities - embedded derivatives | $ | 205,469 | $ | (1,308,123) | |||||||
Other changes in difference between policy benefit reserves computed using derivative accounting (ASC 815) vs. insurance contracts accounting (ASC 944) | 134,591 | 116,918 | |||||||||
Reinsurance related embedded derivative | 64,380 | (202,444) | |||||||||
$ | 404,440 | $ | (1,393,649) |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Salary and benefits | $ | 48,252 | $ | 36,187 | |||||||
Other | 25,752 | 21,608 | |||||||||
Total other operating costs and expenses | $ | 74,004 | $ | 57,795 |
March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||
Carrying Amount | Percent | Carrying Amount | Percent | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Fixed maturity securities: | |||||||||||||||||||||||
U.S. Government and agencies | $ | 177,878 | 0.4 | % | $ | 169,071 | 0.4 | % | |||||||||||||||
States, municipalities and territories | 3,665,674 | 8.0 | % | 3,822,943 | 8.5 | % | |||||||||||||||||
Foreign corporate securities and foreign governments | 622,583 | 1.4 | % | 616,938 | 1.4 | % | |||||||||||||||||
Corporate securities | 19,584,731 | 43.0 | % | 20,201,774 | 44.8 | % | |||||||||||||||||
Residential mortgage backed securities | 1,283,590 | 2.8 | % | 1,366,927 | 3.0 | % | |||||||||||||||||
Commercial mortgage backed securities | 3,409,589 | 7.5 | % | 3,447,075 | 7.6 | % | |||||||||||||||||
Other asset backed securities | 5,817,083 | 12.8 | % | 5,155,254 | 11.4 | % | |||||||||||||||||
Total fixed maturity securities | 34,561,128 | 75.9 | % | 34,779,982 | 77.1 | % | |||||||||||||||||
Mortgage loans on real estate | 6,986,882 | 15.3 | % | 6,778,977 | 15.0 | % | |||||||||||||||||
Real estate investments | 1,164,879 | 2.6 | % | 1,056,063 | 2.3 | % | |||||||||||||||||
Limited partnerships and limited liability companies | 1,657,415 | 3.6 | % | 1,266,779 | 2.8 | % | |||||||||||||||||
Derivative instruments | 684,033 | 1.5 | % | 431,727 | 1.0 | % | |||||||||||||||||
Other investments | 497,523 | 1.1 | % | 829,900 | 1.8 | % | |||||||||||||||||
45,551,860 | 100.0 | % | 45,143,428 | 100.0 | % | ||||||||||||||||||
Coinsurance investments (1) | 5,866,478 | 6,181,870 | |||||||||||||||||||||
$ | 51,418,338 | $ | 51,325,298 |
March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||||
Rating Agency Rating | Amortized Cost | Carrying Amount | Percent of Fixed Maturity Securities | Amortized Cost | Carrying Amount | Percent of Fixed Maturity Securities | |||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||||
Aaa/Aa/A | $ | 23,751,792 | $ | 21,527,275 | 62.3 | % | $ | 24,462,459 | $ | 21,723,282 | 62.5 | % | |||||||||||||||||||||||
Baa | 13,892,051 | 12,373,819 | 35.8 | % | 14,228,490 | 12,434,302 | 35.7 | % | |||||||||||||||||||||||||||
Total investment grade | 37,643,843 | 33,901,094 | 98.1 | % | 38,690,949 | 34,157,584 | 98.2 | % | |||||||||||||||||||||||||||
Ba | 568,020 | 494,809 | 1.4 | % | 554,605 | 485,166 | 1.4 | % | |||||||||||||||||||||||||||
B | 146,297 | 113,418 | 0.3 | % | 94,185 | 79,058 | 0.2 | % | |||||||||||||||||||||||||||
Caa | 19,684 | 18,397 | 0.1 | % | 20,020 | 18,540 | 0.1 | % | |||||||||||||||||||||||||||
Ca and lower | 37,008 | 33,410 | 0.1 | % | 40,664 | 39,634 | 0.1 | % | |||||||||||||||||||||||||||
Total below investment grade | 771,009 | 660,034 | 1.9 | % | 709,474 | 622,398 | 1.8 | % | |||||||||||||||||||||||||||
38,414,852 | 34,561,128 | 100.0 | % | 39,400,423 | 34,779,982 | 100.0 | % | ||||||||||||||||||||||||||||
Coinsurance investments (1) | 5,369,579 | 4,994,496 | 5,465,596 | 5,024,635 | |||||||||||||||||||||||||||||||
$ | 43,784,431 | $ | 39,555,624 | $ | 44,866,019 | $ | 39,804,617 |
NAIC Designation | NRSRO Equivalent Rating | |||||||
1 | Aaa/Aa/A | |||||||
2 | Baa | |||||||
3 | Ba | |||||||
4 | B | |||||||
5 | Caa | |||||||
6 | Ca and lower |
March 31, 2023 | December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||
NAIC Designation | Amortized Cost | Fair Value | Carrying Amount | Percent of Total Carrying Amount | Amortized Cost | Fair Value | Carrying Amount | Percent of Total Carrying Amount | ||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||
1 | $ | 23,863,099 | $ | 21,622,202 | $ | 21,622,202 | 62.6 | % | $ | 24,466,961 | $ | 21,752,775 | $ | 21,752,775 | 62.5 | % | ||||||||||||||||||||||||||||||||||
2 | 13,802,465 | 12,303,113 | 12,303,113 | 35.6 | % | 14,185,506 | 12,398,001 | 12,398,001 | 35.6 | % | ||||||||||||||||||||||||||||||||||||||||
3 | 579,165 | 503,236 | 503,236 | 1.5 | % | 562,190 | 490,198 | 490,198 | 1.5 | % | ||||||||||||||||||||||||||||||||||||||||
4 | 151,304 | 116,477 | 116,477 | 0.3 | % | 109,409 | 91,495 | 91,495 | 0.3 | % | ||||||||||||||||||||||||||||||||||||||||
5 | 7,171 | 7,595 | 7,595 | — | % | 61,721 | 36,738 | 36,738 | 0.1 | % | ||||||||||||||||||||||||||||||||||||||||
6 | 11,648 | 8,505 | 8,505 | — | % | 14,636 | 10,775 | 10,775 | — | % | ||||||||||||||||||||||||||||||||||||||||
38,414,852 | 34,561,128 | 34,561,128 | 100.0 | % | 39,400,423 | 34,779,982 | 34,779,982 | 100.0 | % | |||||||||||||||||||||||||||||||||||||||||
Coinsurance investments (1) | 5,369,579 | 4,994,496 | 4,994,496 | 5,465,596 | 5,024,635 | 5,024,635 | ||||||||||||||||||||||||||||||||||||||||||||
$ | 43,784,431 | $ | 39,555,624 | $ | 39,555,624 | $ | 44,866,019 | $ | 39,804,617 | $ | 39,804,617 |
Number of Securities | Amortized Cost | Unrealized Losses, Net of Allowance | Allowance for Credit Losses | Fair Value | |||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
March 31, 2023 | |||||||||||||||||||||||||||||
Fixed maturity securities, available for sale: | |||||||||||||||||||||||||||||
U.S. Government and agencies | 18 | $ | 65,527 | $ | (2,208) | $ | — | $ | 63,319 | ||||||||||||||||||||
States, municipalities and territories | 484 | 3,069,059 | (453,084) | — | 2,615,975 | ||||||||||||||||||||||||
Foreign corporate securities and foreign governments | 41 | 573,609 | (64,794) | — | 508,815 | ||||||||||||||||||||||||
Corporate securities | 1,878 | 19,559,724 | (2,710,761) | (1,914) | 16,847,049 | ||||||||||||||||||||||||
Residential mortgage backed securities | 222 | 1,190,237 | (109,208) | (133) | 1,080,896 | ||||||||||||||||||||||||
Commercial mortgage backed securities | 330 | 3,738,130 | (386,242) | — | 3,351,888 | ||||||||||||||||||||||||
Other asset backed securities | 615 | 4,874,105 | (340,951) | — | 4,533,154 | ||||||||||||||||||||||||
3,588 | 33,070,391 | (4,067,248) | (2,047) | 29,001,096 | |||||||||||||||||||||||||
Coinsurance investments (1) | 587 | 2,835,968 | (467,166) | — | 2,368,802 | ||||||||||||||||||||||||
4,175 | $ | 35,906,359 | $ | (4,534,414) | $ | (2,047) | $ | 31,369,898 | |||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||
Fixed maturity securities, available for sale: | |||||||||||||||||||||||||||||
U.S. Government and agencies | 27 | $ | 165,746 | $ | (4,637) | $ | — | $ | 161,109 | ||||||||||||||||||||
States, municipalities and territories | 514 | 3,265,080 | (574,814) | — | 2,690,266 | ||||||||||||||||||||||||
Foreign corporate securities and foreign governments | 43 | 590,944 | (74,151) | — | 516,793 | ||||||||||||||||||||||||
Corporate securities | 2,103 | 21,393,656 | (3,224,609) | (3,214) | 18,165,833 | ||||||||||||||||||||||||
Residential mortgage backed securities | 219 | 1,235,672 | (126,368) | (133) | 1,109,171 | ||||||||||||||||||||||||
Commercial mortgage backed securities | 339 | 3,750,331 | (391,966) | — | 3,358,365 | ||||||||||||||||||||||||
Other asset backed securities | 567 | 4,579,149 | (382,563) | — | 4,196,586 | ||||||||||||||||||||||||
3,812 | 34,980,578 | (4,779,108) | (3,347) | 30,198,123 | |||||||||||||||||||||||||
Coinsurance investments (1) | 698 | 3,085,834 | (504,739) | — | 2,581,095 | ||||||||||||||||||||||||
4,510 | $ | 38,066,412 | $ | (5,283,847) | $ | (3,347) | $ | 32,779,218 |
NAIC Designation | Carrying Value of Securities with Gross Unrealized Losses | Percent of Total | Gross Unrealized Losses (1) | Percent of Total | ||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||
March 31, 2023 | ||||||||||||||||||||||||||
1 | $ | 17,868,963 | 61.6 | % | $ | (2,401,857) | 59.0 | % | ||||||||||||||||||
2 | 10,542,301 | 36.4 | % | (1,552,242) | 38.2 | % | ||||||||||||||||||||
3 | 464,864 | 1.6 | % | (77,008) | 1.9 | % | ||||||||||||||||||||
4 | 116,477 | 0.4 | % | (34,788) | 0.9 | % | ||||||||||||||||||||
5 | 88 | — | % | (23) | — | % | ||||||||||||||||||||
6 | 8,403 | — | % | (1,330) | — | % | ||||||||||||||||||||
29,001,096 | 100.0 | % | (4,067,248) | 100.0 | % | |||||||||||||||||||||
Coinsurance investments (2) | 2,368,802 | (467,166) | ||||||||||||||||||||||||
$ | 31,369,898 | $ | (4,534,414) | |||||||||||||||||||||||
December 31, 2022 | ||||||||||||||||||||||||||
1 | $ | 18,396,691 | 60.9 | % | $ | (2,836,027) | 59.4 | % | ||||||||||||||||||
2 | 11,207,008 | 37.1 | % | (1,825,520) | 38.2 | % | ||||||||||||||||||||
3 | 465,867 | 1.6 | % | (72,976) | 1.5 | % | ||||||||||||||||||||
4 | 89,686 | 0.3 | % | (17,922) | 0.4 | % | ||||||||||||||||||||
5 | 29,075 | 0.1 | % | (25,037) | 0.5 | % | ||||||||||||||||||||
6 | 9,796 | — | % | (1,626) | — | % | ||||||||||||||||||||
30,198,123 | 100.0 | % | (4,779,108) | 100.0 | % | |||||||||||||||||||||
Coinsurance investments (2) | 2,581,095 | (504,739) | ||||||||||||||||||||||||
$ | 32,779,218 | $ | (5,283,847) |
Number of Securities | Amortized Cost, Net of Allowance (1) | Fair Value | Gross Unrealized Losses, Net of Allowance (1) | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
March 31, 2023 | |||||||||||||||||||||||
Fixed maturity securities, available for sale: | |||||||||||||||||||||||
Investment grade: | |||||||||||||||||||||||
Less than six months | 299 | $ | 1,520,278 | $ | 1,486,349 | $ | (33,929) | ||||||||||||||||
Six months or more and less than twelve months | 1,656 | 15,068,794 | 13,700,860 | (1,367,934) | |||||||||||||||||||
Twelve months or greater | 1,537 | 15,776,291 | 13,224,055 | (2,552,236) | |||||||||||||||||||
Total investment grade | 3,492 | 32,365,363 | 28,411,264 | (3,954,099) | |||||||||||||||||||
Below investment grade: | |||||||||||||||||||||||
Less than six months | 14 | 46,603 | 39,709 | (6,894) | |||||||||||||||||||
Six months or more and less than twelve months | 26 | 231,025 | 196,185 | (34,840) | |||||||||||||||||||
Twelve months or greater | 56 | 425,353 | 353,938 | (71,415) | |||||||||||||||||||
Total below investment grade | 96 | 702,981 | 589,832 | (113,149) | |||||||||||||||||||
3,588 | 33,068,344 | 29,001,096 | (4,067,248) | ||||||||||||||||||||
Coinsurance investments (2) | 587 | 2,835,968 | 2,368,802 | (467,166) | |||||||||||||||||||
4,175 | $ | 35,904,312 | $ | 31,369,898 | $ | (4,534,414) | |||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||
Fixed maturity securities, available for sale: | |||||||||||||||||||||||
Investment grade: | |||||||||||||||||||||||
Less than six months | 984 | $ | 6,296,895 | $ | 5,968,793 | $ | (328,102) | ||||||||||||||||
Six months or more and less than twelve months | 2,308 | 24,207,057 | 20,481,666 | (3,725,391) | |||||||||||||||||||
Twelve months or greater | 427 | 3,761,294 | 3,153,240 | (608,054) | |||||||||||||||||||
Total investment grade | 3,719 | 34,265,246 | 29,603,699 | (4,661,547) | |||||||||||||||||||
Below investment grade: | |||||||||||||||||||||||
Less than six months | 12 | 51,711 | 47,494 | (4,217) | |||||||||||||||||||
Six months or more and less than twelve months | 34 | 319,964 | 265,726 | (54,238) | |||||||||||||||||||
Twelve months or greater | 47 | 340,310 | 281,204 | (59,106) | |||||||||||||||||||
Total below investment grade | 93 | 711,985 | 594,424 | (117,561) | |||||||||||||||||||
3,812 | 34,977,231 | 30,198,123 | (4,779,108) | ||||||||||||||||||||
Coinsurance investments (2) | 698 | 3,085,834 | 2,581,095 | (504,739) | |||||||||||||||||||
4,510 | $ | 38,063,065 | $ | 32,779,218 | $ | (5,283,847) |
Number of Securities | Amortized Cost, Net of Allowance (1) | Fair Value | Gross Unrealized Losses, Net of Allowance (1) | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
March 31, 2023 | |||||||||||||||||||||||
Investment grade: | |||||||||||||||||||||||
Less than six months | 98 | $ | 1,302,413 | $ | 1,018,998 | $ | (283,415) | ||||||||||||||||
Six months or more and less than twelve months | 183 | 2,498,072 | 1,873,667 | (624,405) | |||||||||||||||||||
Twelve months or greater | 169 | 2,654,555 | 1,877,869 | (776,686) | |||||||||||||||||||
Total investment grade | 450 | 6,455,040 | 4,770,534 | (1,684,506) | |||||||||||||||||||
Below investment grade: | |||||||||||||||||||||||
Less than six months | 14 | 110,262 | 74,073 | (36,189) | |||||||||||||||||||
Six months or more and less than twelve months | 5 | 43,500 | 32,827 | (10,673) | |||||||||||||||||||
Twelve months or greater | 1 | 5,279 | 3,643 | (1,636) | |||||||||||||||||||
Total below investment grade | 20 | 159,041 | 110,543 | (48,498) | |||||||||||||||||||
470 | 6,614,081 | 4,881,077 | (1,733,004) | ||||||||||||||||||||
Coinsurance investments (2) | 311 | 1,191,584 | 839,351 | (352,233) | |||||||||||||||||||
781 | $ | 7,805,665 | $ | 5,720,428 | $ | (2,085,237) | |||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||
Investment grade: | |||||||||||||||||||||||
Less than six months | 333 | $ | 3,955,378 | $ | 3,062,075 | $ | (893,303) | ||||||||||||||||
Six months or more and less than twelve months | 299 | 4,496,559 | 3,146,868 | (1,349,691) | |||||||||||||||||||
Twelve months or greater | 1 | 40,351 | 26,854 | (13,497) | |||||||||||||||||||
Total investment grade | 633 | 8,492,288 | 6,235,797 | (2,256,491) | |||||||||||||||||||
Below investment grade: | |||||||||||||||||||||||
Less than six months | 8 | 61,481 | 47,057 | (14,424) | |||||||||||||||||||
Six months or more and less than twelve months | 7 | 111,990 | 71,271 | (40,719) | |||||||||||||||||||
Twelve months or greater | — | — | — | — | |||||||||||||||||||
Total below investment grade | 15 | 173,471 | 118,328 | (55,143) | |||||||||||||||||||
648 | 8,665,759 | 6,354,125 | (2,311,634) | ||||||||||||||||||||
Coinsurance investments (2) | 423 | 1,250,509 | 859,395 | (391,114) | |||||||||||||||||||
1,071 | $ | 9,916,268 | $ | 7,213,520 | $ | (2,702,748) |
Available for sale | |||||||||||
Amortized Cost | Fair Value | ||||||||||
(Dollars in thousands) | |||||||||||
March 31, 2023 | |||||||||||
Due in one year or less | $ | 508,728 | $ | 504,810 | |||||||
Due after one year through five years | 3,470,123 | 3,274,615 | |||||||||
Due after five years through ten years | 4,503,556 | 4,020,041 | |||||||||
Due after ten years through twenty years | 6,324,373 | 5,503,912 | |||||||||
Due after twenty years | 8,461,140 | 6,731,780 | |||||||||
23,267,920 | 20,035,158 | ||||||||||
Residential mortgage backed securities | 1,190,235 | 1,080,896 | |||||||||
Commercial mortgage backed securities | 3,738,130 | 3,351,888 | |||||||||
Other asset backed securities | 4,874,105 | 4,533,154 | |||||||||
33,070,390 | 29,001,096 | ||||||||||
Coinsurance investments (1) | 2,835,968 | 2,368,802 | |||||||||
$ | 35,906,358 | $ | 31,369,898 | ||||||||
December 31, 2022 | |||||||||||
Due in one year or less | $ | 567,599 | $ | 563,298 | |||||||
Due after one year through five years | 3,591,040 | 3,377,197 | |||||||||
Due after five years through ten years | 4,844,271 | 4,280,762 | |||||||||
Due after ten years through twenty years | 7,443,657 | 6,377,081 | |||||||||
Due after twenty years | 8,968,858 | 6,935,663 | |||||||||
25,415,425 | 21,534,001 | ||||||||||
Residential mortgage backed securities | 1,235,672 | 1,109,171 | |||||||||
Commercial mortgage backed securities | 3,750,331 | 3,358,365 | |||||||||
Other asset backed securities | 4,579,149 | 4,196,586 | |||||||||
34,980,577 | 30,198,123 | ||||||||||
Coinsurance investments (1) | 3,085,834 | 2,581,095 | |||||||||
$ | 38,066,411 | $ | 32,779,218 |
March 31, 2023 | |||||||||||||||||
Amortized Cost | Carrying Amount/ Fair Value | Percent of Total Carrying Amount | |||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Europe | $ | 2,152,353 | $ | 2,142,272 | 6.2 | % | |||||||||||
Asia/Pacific | 381,834 | 381,793 | 1.1 | % | |||||||||||||
Latin America | 313,049 | 313,049 | 0.9 | % | |||||||||||||
Non-U.S. North America | 1,135,154 | 1,131,342 | 3.3 | % | |||||||||||||
Australia & New Zealand | 889,577 | 889,283 | 2.6 | % | |||||||||||||
Other | 740,461 | 743,393 | 2.2 | % | |||||||||||||
5,612,428 | 5,601,132 | 16.3 | % | ||||||||||||||
Coinsurance investments (1) | 1,383,922 | 1,265,832 | |||||||||||||||
$ | 6,996,350 | $ | 6,866,964 |
March 31, 2023 | |||||||||||
Amortized Cost | Carrying Amount/ Fair Value | ||||||||||
(Dollars in thousands) | |||||||||||
Europe | $ | 96,444 | $ | 83,807 | |||||||
Asia/Pacific | 36 | 30 | |||||||||
Latin America | 45,554 | 38,377 | |||||||||
Non-U.S. North America | 23,248 | 19,669 | |||||||||
Australia & New Zealand | 258 | 213 | |||||||||
Other | 35,948 | 32,160 | |||||||||
201,488 | 174,256 | ||||||||||
Coinsurance investments (1) | 50,299 | 33,774 | |||||||||
$ | 251,787 | $ | 208,030 |
General Description | Number of Securities | Amortized Cost | Allowance for Credit Losses | Amortized Cost, Net of Allowance | Net Unrealized Gains (Losses), Net of Allowance | Fair Value | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||
States, municipalities and territories | 1 | $ | 20,657 | $ | — | $ | 20,657 | $ | (3,409) | $ | 17,248 | |||||||||||||||||||||||||||
Corporate securities - Public securities | 3 | 48,310 | — | 48,310 | (21,420) | 26,890 | ||||||||||||||||||||||||||||||||
Corporate securities - Private placement securities | 1 | 7,658 | (1,914) | 5,744 | — | 5,744 | ||||||||||||||||||||||||||||||||
Residential mortgage backed securities | 31 | 48,492 | (133) | 48,359 | (13,874) | 34,485 | ||||||||||||||||||||||||||||||||
Commercial mortgage backed securities | 11 | 93,472 | — | 93,472 | (10,907) | 82,565 | ||||||||||||||||||||||||||||||||
Other asset backed securities | 1 | 2,284 | — | 2,284 | 100 | 2,384 | ||||||||||||||||||||||||||||||||
Collateralized loan obligations | 19 | 134,318 | — | 134,318 | (27,040) | 107,278 | ||||||||||||||||||||||||||||||||
67 | $ | 355,191 | $ | (2,047) | $ | 353,144 | $ | (76,550) | $ | 276,594 |
Current | 30-59 days past due | 60-89 days past due | Over 90 days past due | Total | |||||||||||||||||||||||||
As of March 31, 2023: | (Dollars in thousands) | ||||||||||||||||||||||||||||
Commercial mortgage loans | $ | 3,563,907 | $ | — | $ | — | $ | — | $ | 3,563,907 | |||||||||||||||||||
Agricultural mortgage loans | 601,924 | — | — | 5,343 | 607,267 | ||||||||||||||||||||||||
Residential mortgage loans | 3,013,733 | 24,577 | — | 35,367 | 3,073,677 | ||||||||||||||||||||||||
Total mortgage loans | $ | 7,179,564 | $ | 24,577 | $ | — | $ | 40,710 | $ | 7,244,851 | |||||||||||||||||||
As of December 31, 2022: | |||||||||||||||||||||||||||||
Commercial mortgage loans | $ | 3,554,558 | $ | — | $ | — | $ | — | $ | 3,554,558 | |||||||||||||||||||
Agricultural mortgage loans | 562,828 | — | — | 3,135 | 565,963 | ||||||||||||||||||||||||
Residential mortgage loans | 2,751,261 | 62,450 | 16,924 | 34,843 | 2,865,478 | ||||||||||||||||||||||||
Total mortgage loans | $ | 6,868,647 | $ | 62,450 | $ | 16,924 | $ | 37,978 | $ | 6,985,999 |
March 31, 2023 | December 31, 2022 | |||||||||||||||||||||||||
Private Asset Class | Amount | Percent | Amount | Percent | ||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||
Real estate loans | ||||||||||||||||||||||||||
Commercial | $ | 3,351,563 | 6.8 | % | $ | 3,384,240 | 6.8 | % | ||||||||||||||||||
Residential | 3,222,935 | 6.6 | % | 3,002,099 | 6.0 | % | ||||||||||||||||||||
Agricultural | 607,267 | 1.2 | % | 565,963 | 1.2 | % | ||||||||||||||||||||
Total real estate loans | 7,181,765 | 14.6 | % | 6,952,302 | 14.0 | % | ||||||||||||||||||||
Private credit | ||||||||||||||||||||||||||
Middle market | 1,748,582 | 3.5 | % | 1,492,727 | 3.0 | % | ||||||||||||||||||||
Specialty finance | 692,437 | 1.4 | % | 442,555 | 0.9 | % | ||||||||||||||||||||
Infrastructure debt | 626,767 | 1.3 | % | 554,812 | 1.1 | % | ||||||||||||||||||||
Total private credit | 3,067,786 | 6.2 | % | 2,490,094 | 5.0 | % | ||||||||||||||||||||
Equity | ||||||||||||||||||||||||||
Residential real estate | 1,050,328 | 2.1 | % | 961,263 | 1.9 | % | ||||||||||||||||||||
Commercial real estate | 116,335 | 0.2 | % | 116,779 | 0.2 | % | ||||||||||||||||||||
Infrastructure | 189,976 | 0.4 | % | 91,485 | 0.2 | % | ||||||||||||||||||||
Core private equity | 345,499 | 0.7 | % | 363,892 | 0.7 | % | ||||||||||||||||||||
Total equity | 1,702,138 | 3.4 | % | 1,533,419 | 3.0 | % | ||||||||||||||||||||
Total private assets | $ | 11,951,689 | 24.2 | % | $ | 10,975,815 | 22.0 | % |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
(Dollars in thousands) | |||||||||||
Proceeds received at expiration of options related to such credits | $ | 3,601 | $ | 228,092 | |||||||
Annual index credits to policyholders on their anniversaries | 3,533 | 224,385 |
Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Program (a) | Approximate Dollar Value of Shares That May Yet Be Purchased Under Program | ||||||||||||||||||||||
(shares) | (dollars) | (shares) | (dollars in thousands) | |||||||||||||||||||||||
January 1, 2023 - January 31, 2023 | — | $ | — | — | $ | 569,018 | ||||||||||||||||||||
February 1, 2023 - February 28, 2023 | 441,625 | $ | 41.12 | 441,625 | $ | 550,858 | ||||||||||||||||||||
March 1, 2023 - March 31, 2023 | 6,826,239 | $ | 34.43 | 6,826,239 | $ | 275,825 | ||||||||||||||||||||
Total | 7,267,864 | 7,267,864 |
Exhibit Number | Description | |||||||
10.1* | ||||||||
10.2* | ||||||||
31.1 | ||||||||
31.2 | ||||||||
32.1 | ||||||||
32.2 | ||||||||
101 | The following materials from American Equity Investment Life Holding Company's Quarterly Report on Form 10-Q for the period ended March 31, 2023 formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Changes in Stockholders' Equity, (v) the Consolidated Statements of Cash Flows and (vi) the Notes to Unaudited Consolidated Financial Statements. | |||||||
104 | The cover page from American Equity Investment Life Holding Company's Quarterly Report on Form 10-Q for the period ended March 31, 2023 formatted in iXBRL and contained in Exhibit 101. |
Date: | May 10, 2023 | AMERICAN EQUITY INVESTMENT LIFE | |||||||||||||||
HOLDING COMPANY | |||||||||||||||||
By: | /s/ Dewayne Lummus | ||||||||||||||||
Dewayne Lummus | |||||||||||||||||
Senior Vice President and Chief Accounting Officer | |||||||||||||||||
(Principal Accounting Officer and Duly Authorized Officer) |
1 Year American Equity Investme... Chart |
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