Latest news with #Corebridge
Yahoo
10 hours ago
- Business
- Yahoo
Corebridge Exits Variable Annuity Block in $2.8B Reinsurance Deal
Corebridge Financial, Inc. CRBG recently inked a deal with a subsidiary of Venerable Holdings, Inc., CS Life Re, to reinsure the entire block of variable annuities within its Individual Retirement segment. The total value of the transaction stands at $2.8 billion, comprising a combination of ceding commission and capital release, and is expected to yield roughly $2.1 billion in net distributable proceeds after taxes for Corebridge. The reinsurance transaction encompasses the entire in-force book of variable annuity contracts within the Individual Retirement business. As of March 31, 2025, this portfolio held an account value (AV) of $51 billion. This AV includes $5 billion of General Account assets, which will be reinsured on a coinsurance basis, and $46 billion of Separate Account assets, which will be handled via modified coinsurance. Corebridge's insurance subsidiaries, American General Life Insurance Company ('AGL') and The United States Life Insurance Company in the City of New York ('USL'), will facilitate the reinsurance agreements. In addition to the reinsurance of annuity liabilities, the deal includes the divestiture of SAAMCo, an investment adviser and portfolio manager for Corebridge's variable annuity products. Subject to customary regulatory approvals and other closing conditions, the AGL transaction is anticipated to be completed in the third quarter of 2025, while the closing of the USL transaction and the sale of SAAMCo are expected in the fourth quarter. From a financial standpoint, the transaction implies a valuation multiple of approximately nine-10 times Corebridge's expected operating earnings for 2026 and 2027. Although CRBG anticipates a decrease in adjusted after-tax operating income of roughly $300 million in 2026, this impact is expected to decline significantly over the ensuing years. Furthermore, the transaction is projected to improve the company's Life Fleet Risk-Based Capital ratio by more than 50 points, even before accounting for the effects of the share repurchase program. The reinsurance transaction with CS Life Re will enable Corebridge to completely exit a legacy business line known for its historically volatile GAAP earnings and potential tail risk exposure. As a result, CRBG is likely to significantly reshape its portfolio and boost shareholder value with proceeds derived from the transaction while reducing its risk exposure. The majority of the proceeds from the transaction will be returned to shareholders through share repurchases, while the remaining portion will be used to support future organic growth initiatives. In tandem with the reinsurance transaction announcement, the board of directors of Corebridge sanctioned a $2 billion increase to its existing share repurchase authorization. CRBG actively engages in share repurchases and management has authorized increases in share buyback programs over the past few years, evident by a $2 billion increase each in April 2024 and February 2025. As of May 1, 2025, around $2.3 billion remained under its share repurchase authorization. Shares of Corebridge have gained 20.2% in the past year compared with the industry's 10.7% growth. CRBG currently carries a Zacks Rank #3 (Hold). Image Source: Zacks Investment Research Some better-ranked stocks in the insurance space are MGIC Investment Corporation MTG, Old Republic International Corporation ORI and Skyward Specialty Insurance Group, Inc. SKWD. While MGIC Investment sports a Zacks Rank #1 (Strong Buy), Old Republic and Skyward Specialty carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today's Zacks #1 Rank stocks here. MGIC Investment's earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 15.88%. The Zacks Consensus Estimate for MTG's 2025 earnings indicates a 0.3% rise, while the estimate for revenues implies an improvement of 1.3% from the respective prior-year figures. The consensus mark for MTG's earnings has moved 0.7% north in the past seven days. Shares of MGIC Investment have gained 28.2% in the past year. Old Republic's earnings surpassed estimates in each of the last four quarters, the average surprise being 39.61%. The Zacks Consensus Estimate for ORI's 2025 earnings indicates a 5.6% rise, while the estimate for revenues implies an improvement of 7.8% from the respective prior-year figures. The consensus mark for ORI's earnings has moved 0.6% north in the past 60 days. Shares of Old Republic have gained 23.3% in the past year. Skyward Specialty's earnings outpaced estimates in each of the trailing four quarters, the average surprise being 12.86%. The Zacks Consensus Estimate for ORI's 2025 earnings indicates a 15% rise, while the estimate for revenues implies an improvement of 16.3% from the respective prior-year figures. The consensus mark for SKWD's earnings has moved up 2.9% in the past 60 days. Shares of Skyward Specialty have gained 56.8% in the past year. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report MGIC Investment Corporation (MTG) : Free Stock Analysis Report Old Republic International Corporation (ORI) : Free Stock Analysis Report Corebridge Financial, Inc. (CRBG) : Free Stock Analysis Report Skyward Specialty Insurance Group, Inc. (SKWD) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
18 hours ago
- Business
- Yahoo
Corebridge enters $2.8B reinsurance agreement with CS Life Re
Corebridge (CRBG) Financial earlier announced that it has entered into an agreement with CS Life Re, a subsidiary of Venerable Holdings, to reinsure all the variable annuities of its Individual Retirement business, with account value totaling $51B as of March 31, 2025. The transaction is valued at $2.8B, consisting of both ceding commission and capital release, and will generate approximately $2.1B of net distributable proceeds after-tax for Corebridge. Kevin Hogan, President and CEO of Corebridge, said, 'This is a transformative transaction that repositions the company by exiting Individual Retirement variable annuities. This transaction delivers significant value for Corebridge and its shareholders. We are reaffirming our financial targets while reducing risk and maintaining our diversified business model. We expect to use the proceeds to accelerate our capital management objectives, including a substantial majority returned via share repurchases, with the remainder to support organic growth. Our Board of Directors approved a $2B increase to our share repurchase authorization in connection with this transaction.' Shares of Corebridge Financial are up nearly 6% to $34.97 in morning trading. Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter Published first on TheFly – the ultimate source for real-time, market-moving breaking financial news. Try Now>> See Insiders' Hot Stocks on TipRanks >> Read More on CRBG: Disclaimer & DisclosureReport an Issue Corebridge Financial Announces Major Reinsurance Transaction Corebridge Financial Elects Directors at Annual Meeting Corebridge participates in a conference call with JPMorgan Corebridge price target raised to $37 from $32 at Morgan Stanley Soros buys JPMorgan, exits Alibaba in Q1
Yahoo
20 hours ago
- Business
- Yahoo
Corebridge Financial strikes $2.8bn reinsurance deal with Venerable
Corebridge Financial has reached an agreement with CS Life Re, a subsidiary of Venerable Holdings, to reinsure its individual retirement variable annuity portfolio for $2.8bn. The transaction, which includes a ceding commission and capital release, is projected to yield $2.1bn in net distributable proceeds after taxes for Corebridge. The deal encompasses Corebridge's entire variable annuity in-force book, with a total account value of $51bn as of 31 March 2025. This includes $5bn of general account value and $46bn of separate account value, the latter being reinsured on a modified coinsurance basis. Additionally, the transaction involves the sale of Corebridge's investment adviser SunAmerica Asset Management (SAAMCo) to Venerable. Counterparty protections are included in the deal, with the SAAMCo team joining Venerable following the acquisition. Corebridge CEO and president Kevin Hogan said: 'This transaction delivers significant value for Corebridge and its shareholders. We are reaffirming our financial targets while reducing risk and maintaining our diversified business model. 'We expect to use the proceeds to accelerate our capital management objectives, including a substantial majority returned via share repurchases, with the remainder to support organic growth.' The expected closure for the AGL reinsurance is in the third quarter, while the USL reinsurance and SAAMCo sale are anticipated in the fourth quarter, pending regulatory approvals and other standard closing conditions. Corebridge will cease new Individual Retirement variable annuity offerings in New York state through USL before the transaction concludes. This deal is set to increase Venerable's total assets under risk management by 77%, from $67bn to $118bn, based on figures as of 31 March 2025. Venerable chairman and CEO David Marcinek stated: 'Today's announcement affirms Venerable as the partner of choice in the variable annuity risk transfer space and advances aspirations to expand our growth strategy to include variable annuity flow reinsurance.' American International Group (AIG) sold 120 million shares of Corebridge to Nippon Life Insurance Company for $3.8bn in December last year. "Corebridge Financial strikes $2.8bn reinsurance deal with Venerable " was originally created and published by Life Insurance International, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Associated Press
2 days ago
- Business
- Associated Press
Corebridge Financial Announces Transformative Individual Retirement Variable Annuity Transaction with Venerable
HOUSTON--(BUSINESS WIRE)--Jun 26, 2025-- Corebridge Financial, Inc. ('Corebridge' or the 'Company') (NYSE: CRBG) today announced that it has entered into an agreement with CS Life Re, a subsidiary of Venerable Holdings, Inc. ('Venerable') to reinsure all the variable annuities of its Individual Retirement business, with account value totaling $51 billion as of March 31, 2025. The transaction is valued at $2.8 billion, consisting of both ceding commission and capital release, and will generate approximately $2.1 billion of net distributable proceeds after-tax for Corebridge 1. Kevin Hogan, President and Chief Executive Officer of Corebridge, said, 'This is a transformative transaction that repositions the company by exiting Individual Retirement variable annuities. This transaction delivers significant value for Corebridge and its shareholders. We are reaffirming our financial targets while reducing risk and maintaining our diversified business model. 'We expect to use the proceeds to accelerate our capital management objectives, including a substantial majority returned via share repurchases, with the remainder to support organic growth. Our Board of Directors approved a $2 billion increase to our share repurchase authorization in connection with this transaction. 'We are pleased to partner with Venerable on this transaction given their deep expertise and leadership in the variable annuity reinsurance business.' Transaction Overview Financial Overview Broad Individual Retirement Product Platform Conference Call Corebridge will host a conference call at 8:30 a.m. EDT on Thursday, June 26, 2025, to review the details of this announcement. The call is open to the public and can be accessed via a live, listen-only webcast in the Investors section of A replay will be available after the call at the same location. Morgan Stanley & Co. LLC acted as financial advisor, Oliver Wyman as actuarial advisors, and Willkie Farr & Gallagher LLP acted as legal counsel to Corebridge. About Corebridge Financial Corebridge Financial, Inc. (NYSE: CRBG) makes it possible for more people to take action in their financial lives. With more than $400 billion in assets under management and administration as of March 31, 2025, Corebridge Financial is one of the largest providers of retirement solutions and insurance products in the United States. We proudly partner with financial professionals and institutions to help individuals plan, save for and achieve secure financial futures. For more information, visit and follow us on LinkedIn, YouTube and Instagram. In the discussion below, 'we,' 'us' and 'our' refer to Corebridge and its consolidated subsidiaries, unless the context refers solely to Corebridge as a corporate entity. Cautionary statement regarding forward-looking information Certain statements in this press release and other publicly available documents may include statements of historical or present fact, which, to the extent they are not statements of historical or present fact, constitute 'forward-looking statements' within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the use of words such as 'expects,' 'believes,' 'anticipates,' 'intends,' 'seeks,' 'aims,' 'plans,' 'assumes,' 'estimates,' 'projects,' 'is optimistic,' 'targets,' 'should,' 'would,' 'could,' 'may,' 'will,' 'shall' or variations of such words are generally part of forward-looking statements. Also, forward-looking statements include, without limitation, all matters that are not historical facts. Forward-looking statements are made based on management's current expectations and beliefs concerning future developments and their potential effects upon Corebridge. There can be no assurance that future developments affecting Corebridge will be those anticipated by management. Any forward-looking statements included herein are not a guarantee of future performance and involve risks and uncertainties, and there are certain important factors that could cause actual results to differ, possibly materially, from expectations or estimates reflected or implied in such forward-looking statements, including, among others, risks related to: Any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by law. You are advised, however, to consult any further disclosures we make on related subjects in our filings with the Securities and Exchange Commission ('SEC'). Unless specifically noted otherwise, forward-looking projections are based on our financial statements as filed with the SEC in our quarterly report on Form 10-Q for the quarter ended March 31, 2025. Use of Non-GAAP Financial Measures This release includes a reference to Adjusted after-tax operating income ('AATOI'), a non-GAAP financial measure. AATOI is derived by excluding the tax effected adjusted pre-tax operating ('APTOI') adjustments described below, as well as the following tax items from net income attributable to us: APTOI is derived by excluding the items set forth below from income (loss) before income tax expense (benefit). These items generally fall into one or more of the following broad categories: legacy matters having no relevance to our current businesses or operating performance; adjustments to enhance transparency to the underlying economics of transactions; and recording adjustments to APTOI that we believe to be common in our industry. We believe the adjustments to pre-tax income are useful for gaining an understanding of our overall results of operations. APTOI excludes the impact of the following items: FORTITUDE RE RELATED ADJUSTMENTS: The modified coinsurance ('modco') reinsurance agreements with Fortitude Re transfer the economics of the invested assets supporting the reinsurance agreements to Fortitude Re. Accordingly, the net investment income on Fortitude Re funds withheld assets and the net realized gains (losses) on Fortitude Re funds withheld assets are excluded from APTOI. Similarly, changes in the Fortitude Re funds withheld embedded derivative are also excluded from APTOI. The ongoing results associated with the reinsurance agreement with Fortitude Re have been excluded from APTOI as these are not indicative of our ongoing business operations. INVESTMENT RELATED ADJUSTMENTS: APTOI excludes 'Net realized gains (losses)', except for gains (losses) related to the disposition of real estate investments. Net realized gains (losses), except for gains (losses) related to the disposition of real estate investments, are excluded as the timing of sales on invested assets or changes in allowances depend largely on market credit cycles and can vary considerably across periods. In addition, changes in interest rates may create opportunistic scenarios to buy or sell invested assets. Our derivative results, including those used to economically hedge insurance liabilities, or those recognized as embedded derivatives at fair value, are also included in Net realized gains (losses) and are similarly excluded from APTOI except earned income (periodic settlements and changes in settlement accruals) on derivative instruments used for non-qualifying (economic) hedges or for asset replication. Earned income on such economic hedges is reclassified from Net realized gains and losses to specific APTOI line items based on the economic risk being hedged (e.g., Net investment income and Interest credited to policyholder account balances). MARKET RISK BENEFIT ADJUSTMENTS ('MRBs'): Certain of our variable annuity, fixed annuity and fixed index annuity contracts contain guaranteed minimum withdrawal benefits ('GMWBs') and/or guaranteed minimum death benefits ('GMDBs') which are accounted for as MRBs. Changes in the fair value of these MRBs (excluding changes related to our own credit risk), including certain rider fees attributed to the MRBs, along with changes in the fair value of derivatives used to hedge MRBs are recorded through 'Change in the fair value of MRBs, net' and are excluded from APTOI. Changes in the fair value of securities used to economically hedge MRBs are excluded from APTOI. OTHER ADJUSTMENTS: Other adjustments represent all other adjustments that are excluded from APTOI and includes the net pre-tax operating income (losses) from noncontrolling interests related to consolidated investment entities. The excluded adjustments include, as applicable: Key Operating Metrics and Key Terms This release includes a reference to Life Fleet RBC Ratio. Life Fleet means American General Life Insurance Company ('AGL'), The United States Life Insurance Company in the City of New York ('USL') and The Variable Annuity Life Insurance Company ('VALIC'). Life Fleet RBC Ratio is the risk-based capital ('RBC') ratio for the Life Fleet. RBC ratios are quoted using the Company Action Level. View source version on CONTACT: Işıl Müderrisoğlu (Investors):[email protected] Matt Ward (Media):[email protected] KEYWORD: UNITED STATES NORTH AMERICA TEXAS INDUSTRY KEYWORD: PROFESSIONAL SERVICES INSURANCE FINANCE SOURCE: Corebridge Financial Copyright Business Wire 2025. PUB: 06/26/2025 06:45 AM/DISC: 06/26/2025 06:44 AM
Business Wire
2 days ago
- Business
- Business Wire
Corebridge Financial Announces Transformative Individual Retirement Variable Annuity Transaction with Venerable
HOUSTON--(BUSINESS WIRE)--Corebridge Financial, Inc. ('Corebridge' or the 'Company') (NYSE: CRBG) today announced that it has entered into an agreement with CS Life Re, a subsidiary of Venerable Holdings, Inc. ('Venerable') to reinsure all the variable annuities of its Individual Retirement business, with account value totaling $51 billion as of March 31, 2025. The transaction is valued at $2.8 billion, consisting of both ceding commission and capital release, and will generate approximately $2.1 billion of net distributable proceeds after-tax for Corebridge 1. Kevin Hogan, President and Chief Executive Officer of Corebridge, said, 'This is a transformative transaction that repositions the company by exiting Individual Retirement variable annuities. This transaction delivers significant value for Corebridge and its shareholders. We are reaffirming our financial targets while reducing risk and maintaining our diversified business model. 'We expect to use the proceeds to accelerate our capital management objectives, including a substantial majority returned via share repurchases, with the remainder to support organic growth. Our Board of Directors approved a $2 billion increase to our share repurchase authorization in connection with this transaction. 'We are pleased to partner with Venerable on this transaction given their deep expertise and leadership in the variable annuity reinsurance business.' Transaction Overview Corebridge will reinsure its entire Individual Retirement variable annuity in-force book, amounting to $51 billion of total account value as of March 31, 2025, through reinsurance transactions with the Company's insurance subsidiaries American General Life Insurance Company ('AGL') and The United States Life Insurance Company in the City of New York ('USL') The $51 billion of total account value ('AV') includes $5 billion of General Account AV (reinsured 100% on a coinsurance basis) and $46 billion of Separate Account AV (reinsured on a modified coinsurance basis) New variable annuity contracts written through the Individual Retirement business and issued by AGL will be reinsured through an ongoing flow reinsurance agreement that will begin once the transaction is closed The transaction includes the sale of a related investment adviser and manager for portfolios offered in Corebridge variable annuity products (SAAMCo) The transaction also includes extensive counterparty protections, including comfort trusts with defined investment guidelines, over-collateralization requirements, and a protective hedging arrangement The AGL transaction is expected to close in the third quarter while the USL transaction and the sale of SAAMCo are expected to close in the fourth quarter, subject to customary closing conditions including regulatory approvals Financial Overview Attractive earnings multiple of approximately 9–10x 2026E and 2027E operating earnings 2 Exits a portfolio with historically volatile GAAP earnings and tail risk exposure AATOI expected to decrease by approximately $300 million in 2026 and the impact is expected to decrease materially over the next few years Increases the Life Fleet RBC ratio by over 50 points before any share repurchases Broad Individual Retirement Product Platform Corebridge will continue to offer one of the broadest annuity product platforms in the industry, including fixed, index and registered index-linked annuity (RILA) products, maintaining its commitment to help financial professionals meet the diverse retirement needs of their clients The Individual Retirement business will continue to manufacture and distribute variable annuity products outside New York state supported by a flow arrangement with Venerable Prior to the close of the transaction, USL will cease manufacturing and distributing new Individual Retirement variable annuities in New York state Corebridge will continue to administer and service all of its contracts, including those covered by the reinsurance transactions Conference Call Corebridge will host a conference call at 8:30 a.m. EDT on Thursday, June 26, 2025, to review the details of this announcement. The call is open to the public and can be accessed via a live, listen-only webcast in the Investors section of A replay will be available after the call at the same location. Morgan Stanley & Co. LLC acted as financial advisor, Oliver Wyman as actuarial advisors, and Willkie Farr & Gallagher LLP acted as legal counsel to Corebridge. About Corebridge Financial Corebridge Financial, Inc. (NYSE: CRBG) makes it possible for more people to take action in their financial lives. With more than $400 billion in assets under management and administration as of March 31, 2025, Corebridge Financial is one of the largest providers of retirement solutions and insurance products in the United States. We proudly partner with financial professionals and institutions to help individuals plan, save for and achieve secure financial futures. For more information, visit and follow us on LinkedIn, YouTube and Instagram. In the discussion below, 'we,' 'us' and 'our' refer to Corebridge and its consolidated subsidiaries, unless the context refers solely to Corebridge as a corporate entity. Cautionary statement regarding forward-looking information Certain statements in this press release and other publicly available documents may include statements of historical or present fact, which, to the extent they are not statements of historical or present fact, constitute 'forward-looking statements' within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the use of words such as 'expects,' 'believes,' 'anticipates,' 'intends,' 'seeks,' 'aims,' 'plans,' 'assumes,' 'estimates,' 'projects,' 'is optimistic,' 'targets," 'should,' 'would,' 'could,' 'may,' 'will,' 'shall' or variations of such words are generally part of forward-looking statements. Also, forward-looking statements include, without limitation, all matters that are not historical facts. Forward-looking statements are made based on management's current expectations and beliefs concerning future developments and their potential effects upon Corebridge. There can be no assurance that future developments affecting Corebridge will be those anticipated by management. Any forward-looking statements included herein are not a guarantee of future performance and involve risks and uncertainties, and there are certain important factors that could cause actual results to differ, possibly materially, from expectations or estimates reflected or implied in such forward-looking statements, including, among others, risks related to: changes in interest rates and changes to credit spreads; the deterioration of economic conditions, including an increase in the likelihood of an economic slowdown or recession, changes in market conditions, trade disputes with other countries, including the effect of sanctions and trade restrictions, such as tariffs and trade barriers imposed by the U.S. government and any countermeasures by other governments in response to such tariffs, weakening in capital markets in the U.S and globally, volatility in equity markets, inflationary pressures, the rise of pressures on the commercial real estate market, and geopolitical tensions, including the ongoing armed conflicts between Ukraine and Russia and in the Middle East; the unpredictability of the amount and timing of insurance liability claims; unavailable, uneconomical or inadequate reinsurance or recaptures of reinsured liabilities; uncertainty and unpredictability related to our reinsurance agreements with Fortitude Reinsurance Company Ltd. ('Fortitude Re') and its performance of its obligations under these agreements; our limited ability to access funds from our subsidiaries; our ability to incur indebtedness, our potential inability to refinance all or a portion of our indebtedness or our ability to obtain additional financing on favorable terms or at all; our ability to maintain sufficient eligible collateral to support business and funding strategies requiring collateralization; our inability to generate cash to meet our needs due to the illiquidity of some of our investments; the inaccuracy of the methodologies, estimations and assumptions underlying our valuation of investments and derivatives; a downgrade in our Insurer Financial Strength ('IFS') ratings or credit ratings; exposure to credit risk due to non-performance or defaults by our counterparties or our use of derivative instruments to hedge market risks associated with our liabilities; our ability to adequately assess risks and estimate losses related to the pricing of our products; the failure of third parties that we rely upon to provide and adequately perform certain business, operations, investment advisory, functional support and administrative services on our behalf; the impact of risks associated with our arrangement with Blackstone ISG-I Advisors LLC ('Blackstone IM'), BlackRock Financial Management, Inc. ('BlackRock') or any other asset manager we retain, including their historical performance not being indicative of the future results of our investment portfolio and the exclusivity of certain arrangements with Blackstone IM; our inability to maintain the availability of critical technology systems and the confidentiality of our data, including challenges associated with a variety of privacy and information security laws; the ineffectiveness of our risk management policies and procedures; significant legal, governmental or regulatory proceedings; the intense competition we face in each of our business lines and the technological changes, including the use of artificial intelligence ('AI'), that may present new and intensified challenges to our business; catastrophes, including those associated with climate change and pandemics; business or asset acquisitions and dispositions that may expose us to certain risks; our ability to protect our intellectual property; our ability to operate efficiently and compete effectively in a heavily regulated industry in light of new domestic or international laws and regulations or new interpretations of current laws and regulations; impact on sales of our products and taxation of our operations due to changes in U.S. federal income or other tax laws or the interpretation of tax laws; the ineffectiveness of our productivity improvement initiatives in yielding our expected expense reductions and improvements in operational and organizational efficiency; differences between actual experience and the estimates used in the preparation of financial statements and modeled results used in various areas of our business; our inability to attract and retain key employees and highly skilled people needed to support our business; our relationships with AIG, Nippon and Blackstone and conflicts of interests arising due to such relationships the indemnification obligations we have to AIG; potentially higher U.S. federal income taxes due to our inability to file a single U.S. consolidated federal income tax return for five years following our initial public offering ('IPO') and our separation from AIG causing an 'ownership change' for U.S. federal income tax purposes caused by our separation from AIG; risks associated with the Tax Matters Agreement with AIG and our potential liability for U.S. income taxes of the entire AIG Consolidated Tax Group for all taxable years or portions thereof in which we (or our subsidiaries) were members of such group; the risk that anti-takeover provisions could discourage, delay, or prevent our change in control, even if the change in control would be beneficial to our shareholders; challenges related to compliance with applicable laws incident to being a public company, which is expensive and time-consuming; and other factors discussed in 'Risk Factors' and 'Management's Discussion and Analysis of Financial Condition and Results of Operations' in our Annual Report on Form 10-K for the year ended December 31, 2024, as well as our Quarterly Reports on Form 10-Q. Any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by law. You are advised, however, to consult any further disclosures we make on related subjects in our filings with the Securities and Exchange Commission ("SEC"). Unless specifically noted otherwise, forward-looking projections are based on our financial statements as filed with the SEC in our quarterly report on Form 10-Q for the quarter ended March 31, 2025. Use of Non-GAAP Financial Measures This release includes a reference to Adjusted after-tax operating income ('AATOI'), a non-GAAP financial measure. AATOI is derived by excluding the tax effected adjusted pre-tax operating ('APTOI') adjustments described below, as well as the following tax items from net income attributable to us: reclassifications of disproportionate tax effects from AOCI, changes in uncertain tax positions and other tax items related to legacy matters having no relevance to our current businesses or operating performance; and deferred income tax valuation allowance releases and charges. APTOI is derived by excluding the items set forth below from income (loss) before income tax expense (benefit). These items generally fall into one or more of the following broad categories: legacy matters having no relevance to our current businesses or operating performance; adjustments to enhance transparency to the underlying economics of transactions; and recording adjustments to APTOI that we believe to be common in our industry. We believe the adjustments to pre-tax income are useful for gaining an understanding of our overall results of operations. APTOI excludes the impact of the following items: FORTITUDE RE RELATED ADJUSTMENTS: The modified coinsurance ('modco') reinsurance agreements with Fortitude Re transfer the economics of the invested assets supporting the reinsurance agreements to Fortitude Re. Accordingly, the net investment income on Fortitude Re funds withheld assets and the net realized gains (losses) on Fortitude Re funds withheld assets are excluded from APTOI. Similarly, changes in the Fortitude Re funds withheld embedded derivative are also excluded from APTOI. The ongoing results associated with the reinsurance agreement with Fortitude Re have been excluded from APTOI as these are not indicative of our ongoing business operations. INVESTMENT RELATED ADJUSTMENTS: APTOI excludes 'Net realized gains (losses)', except for gains (losses) related to the disposition of real estate investments. Net realized gains (losses), except for gains (losses) related to the disposition of real estate investments, are excluded as the timing of sales on invested assets or changes in allowances depend largely on market credit cycles and can vary considerably across periods. In addition, changes in interest rates may create opportunistic scenarios to buy or sell invested assets. Our derivative results, including those used to economically hedge insurance liabilities, or those recognized as embedded derivatives at fair value, are also included in Net realized gains (losses) and are similarly excluded from APTOI except earned income (periodic settlements and changes in settlement accruals) on derivative instruments used for non-qualifying (economic) hedges or for asset replication. Earned income on such economic hedges is reclassified from Net realized gains and losses to specific APTOI line items based on the economic risk being hedged (e.g., Net investment income and Interest credited to policyholder account balances). MARKET RISK BENEFIT ADJUSTMENTS ('MRBs'): Certain of our variable annuity, fixed annuity and fixed index annuity contracts contain guaranteed minimum withdrawal benefits ('GMWBs') and/or guaranteed minimum death benefits ('GMDBs') which are accounted for as MRBs. Changes in the fair value of these MRBs (excluding changes related to our own credit risk), including certain rider fees attributed to the MRBs, along with changes in the fair value of derivatives used to hedge MRBs are recorded through 'Change in the fair value of MRBs, net' and are excluded from APTOI. Changes in the fair value of securities used to economically hedge MRBs are excluded from APTOI. OTHER ADJUSTMENTS: Other adjustments represent all other adjustments that are excluded from APTOI and includes the net pre-tax operating income (losses) from noncontrolling interests related to consolidated investment entities. The excluded adjustments include, as applicable: restructuring and other costs related to initiatives designed to reduce operating expenses, improve efficiency and simplify our organization; non-recurring costs associated with the implementation of non-ordinary course legal or regulatory changes to changes to accounting principles; separation costs; non-operating litigation reserves and settlements; loss (gain) on extinguishment of debt, if any; losses from the impairment of goodwill, if any; and income and loss from divested or run-off business, if any. Key Operating Metrics and Key Terms This release includes a reference to Life Fleet RBC Ratio. Life Fleet means American General Life Insurance Company ('AGL'), The United States Life Insurance Company in the City of New York ('USL') and The Variable Annuity Life Insurance Company ('VALIC'). Life Fleet RBC Ratio is the risk-based capital ('RBC') ratio for the Life Fleet. RBC ratios are quoted using the Company Action Level.
