Athene Holding Ltd. · NYSE:ATH/PA
Athene — Debt Investor Presentation (November 2024)
38 slides from Athene's debt investor presentation, Nov 15, 2024
Slide 1: Athene Fixed Income Investor Presentation November 2024
Athene Fixed Income Investor Presentation November 2024
Slide 2: Disclaimer
Disclaimer This presentation does not constitute an offer to sell, or the solicitation of an offer to buy, any security of Athene Holding Ltd. (“AHL” and together with its consolidated subsidiaries, “Athene”). This presentation is not intended to constitute a solicitation of any insurance policy or
Slide 3: YTD 3Q 2024 Operating Performance Continues to be Strong
Record YTD gross organic inflows, and continued momentum with financial institutions (76% of YTD retail sales) Strong new business profitability Robust capitalization in excess of ‘AA’ rating levels Operating expense improvement Robust Spread Related Earnings YTD 3 2024 Operating Performance Continu
Slide 4: Special Topic: Growth Across Different Market Environments
Special Topic: Growth Across Different Market Environments
Slide 5: We Actively Manage the Business through Different Interest Rate and Credit Environments
en en We Actively Manage the Business through Different Interest Rate and Credit Environments 5 1 2 3 Diversified Funding Model Allows Us to Pivot Across Our Growth Channels to Source the Most Attractive Liabilities in Different Market Environments Opportunistically Reallocate ‘Back Book’ of Existin
Slide 6: Different Liabilities Are More Attractive in Different Yield Curve Environments
• When rates are low and expected to rise, it is more attractive to lock in longer-dated liabilities like PGA that don’t fluctuate with rates • When rates are higher and expected to decline, it is more attractive to issue shorter-dated liabilities like MYGA Pension Group Annuity Flow Reinsurance FIA
Slide 7: Our Mix of New Business Origination Can Flex Depending on the Yield Curve
0yrs 1yrs 2yrs 5yrs 7yrs 10yrs 15yrs 20yrs —% 1.50% 3.00% 4.50% 6.00% SOFR Curve - June 2021 SOFR Curve - Today Our Mix of New Business Origination Can Flex Depending on the Shape and Level of the Yield Curve 0yrs 1yrs 2yrs 5yrs 7yrs 10yrs 15yrs 20yrs —% 1.50% 3.00% 4.50% 6.00% New Business WAL1: ~8
Slide 8: Managing Floating Rate Position Through Changing Rate Environments
$1.4 $1.3 $2.5 $2.5 $3.1 $3.1 2019 2020 2021 2022 2023 3Q’24 LTM Managing Floating Rate Position Through Changing Rate Environments 8 Note: Amounts in billions 1. For periods prior to 2022, SRE represents Athene's historically reported adjusted operating income available to common stockholders exclu
Slide 9: Third Quarter Update
VATHENE Third Quarter Update
Slide 10: Key Highlights Reflect Relative Strength of Franchise
10 Key Highlights Reflect Relative Strength of Franchise ATHENE HAS BUILT A FORTRESS BALANCE SHEET DESIGNED TO DELIVER EFFICIENT GROWTH Highly rated and conservatively managed with robust excess capital and liquidity; strategic sidecars provide on-demand equity capital 3 DISCIPLINED OPERATORS WITH A
Slide 11: Athene has a Distinct Credit Profile Within Apollo
11 Athene has a Distinct Credit Profile Within Apollo $733 billion Assets Under Management ~$29 billion Regulatory Capital2 A+ from S&P, Fitch, AM Best; A1 from Moody’s3 ASSET MANAGEMENT RETIREMENT SERVICES 5,000+ Employees Globally Solutions across the alternative risk spectrum Separate capital str
Slide 12: Athene is a Leading Retirement Services Business
Leading market share in total US annuity market1 Rated ‘A+’ or equivalent by S&P, Fitch, AM Best, and Moody’s2 Policyholders in the US Gross invested assets; total GAAP assets of $355B Total employees include ~1,600 located in West Des Moines #1 Athene is a Leading Retirement Services Business... As
Slide 13: Serving a Booming Retirement Population
Age Distribution Re tir ee P op ul at io n (m ill io ns ) 40 45 50 55 60 65 70 75 80 85 90 95 100 ...Serving a Booming Retirement Population 13 +40% expected increase # of people age 65+ in next ~25 years Source: LIMRA analysis of US Census Bureau’s Current Population Survey, March 2023 Supplement a
Slide 14: Athene Has Diligently Built Diversified Organic Growth Capabilities
1. Year-to-date total US annuity market industry ranking per LIMRA as of June 30, 2024. 2. Source Deutsche Bank. Funding agreements are comprised of funding agreements issued under our FABN program, secured and other funding agreements, funding agreements issued to the FHLB and long-term repurchase
Slide 15: Retail Distribution Capabilities are Expanding
Banks 59% Broker Dealers 17% Independent Marketing Organizations 24% 18 Distribution Partners 15 Retail Distribution Capabilities are Expanding Note: Distribution partners as of September 30, 2024. 3Q’24 LTM Retail Inflows by Distribution Channel Athene’s Retail inflows are sourced from a diverse mi
Slide 16: Note: Athene metrics are net of the noncontrolling interests in ACRA, as of September
16 Note: Athene metrics are net of the noncontrolling interests in ACRA, as of September 30, 2024, unless otherwise noted. 1. Relates to Athene’s primary insurance subsidiaries; represents ratings from AM Best "A+", Fitch "A+", S&P "A+" and Moody’s "A1". 2. Represents the aggregate capital of Athene
Slide 17: 10% 10% Note: Athene metrics are net of the noncontrolling interests in ACRA, as
10% 10% 17 Note: Athene metrics are net of the noncontrolling interests in ACRA, as of September 30, 2024, unless otherwise noted. AA-/A+ Rated Companies are: PFG (A+), GL (AA-), MET (AA-), and PRU (AA-). 1. AA-/A+ Rated Company metrics as of June 30, 2024 per SNL Financial. Athene’s statutory reser
Slide 18: Strong Capital and Liquidity Profile
18 Strong Capital and Liquidity Profile Note: Athene metrics are net of the noncontrolling interests in ACRA, as of September 30, 2024, unless otherwise noted. 1. The consolidated risk-based capital ratio of our non-US reinsurance and US insurance subsidiaries calculated by aggregating US RBC and Be
Slide 19: Athene Utilizes Numerous Sources of Capital to Grow Earnings Generation
• Series A-E Preferred Equity – $2.9B issued to date • Senior Debt – $5.0B notional outstanding • Subordinated Debt – $0.6B notional outstanding2 12.9% 14.9% 14.7% 14.5% 16.9% 2020 2021 2022 2023 3Q'24 • Earnings generation – $3.1B of LTM spread related earnings, excluding notable items1 and $2.4B Y
Slide 20: Strategic Sidecar Supports Athene's Growth with On-Demand Equity Capital
20 Strategic Sidecar Supports Athene’s Growth with On-Demand Equity Capital Note: Past performance is not a guarantee of future results. 1. Includes ADIP called capital, leverage and reinvested earnings. Capital Deployed Since Inception1 ~$7.5B Direct equity capital to support Athene’s growth Greate
Slide 21: Capital Allocation Priorities Support Profitable Growth
21 Capital Allocation Priorities Support Profitable Growth Balance sheet strength determines the capital available to pursue profitable growth opportunities Support Profitable Growth Preserve excess capital at ‘AA’ levels with a mid-teens adjusted senior debt-to-capital ratio and strong liquidity Ma
Slide 22: Consistent Investment Management Philosophy
22 Consistent Investment Management Philosophy Target higher and sustainable risk- adjusted returns by capturing origination premia to drive consistent yield outperformance Focus on downside protection given long- dated liability profile and low cost of funding Dynamic asset allocation to take advan
Slide 23: High Quality Asset Portfolio Generates Safe Yield
Corporate & Gov’t 39% CML 12% CLO 10% ABS 12% RML 10% RMBS 3% CMBS 3% Cash and Cash Equivalents 3% Alternatives 5% Other 3% Net Invested Assets $243 BILLION3 Note: As of September 30, 2024. Net invested assets includes Athene's proportionate share of ACRA investments, based on Athene's economic owne
Slide 24: Alignment with Apollo Provides Access to Alpha-Generating Assets
Corporate & Gov’t 35% CLO 14% ABS 19% RML 15% CML 11% CMBS 4% RMBS 1% Other 1% Alignment with Apollo Provides Access to Alpha-Generating Assets 24 3Q'24 LTM Gross Asset PurchasesAsset Sourcing Highlights $102 BILLION Note: Deployment numbers include the noncontrolling interests in ACRA. • Apollo’s p
Slide 25: Alternatives Portfolio Repositioning
77% 12% 11% 70% 20% 10% Alternatives Portfolio Repositioning • Re-positioned and reduced certain retirement services alternative investments by ~$1B in 3Q’24 • Alternative investment portfolio is now more closely aligned with Apollo Aligned Alternatives (“AAA”) 8.2% 9.2% 9.1% 10.7% Alts Portfolio Hi
Slide 26: Persistent and Predictable Liability Portfolio Provides Long-Dated Funding
Fixed Indexed Annuities 37% Fixed Rate Annuities 28% 2% Funding Agreements 19% Pension Group Annuities 12% $226 BILLION Persistent and Predictable Liability Portfolio Provides Long-Dated Funding Note: Metrics are as of or for the three months ended September 30, 2024. Liabilities composition and wei
Slide 27: Historical/Projected Annualized Outflow Rates
Historical/Projected Annualized Outflow Rates 27 Note: Projections in above table represent a best estimate and actual experience may vary. Outflow rate is calculated as outflows attributable to Athene divided by average net invested assets for the respective period, on an annualized basis. 1. Repre
Slide 28: Appendix
Appendix
Slide 29: Rating Agency Commentary
“The rating upgrade to A+ reflects a continuing trend of Athene’s improving balance sheet strength. A.M Best views Athene’s consolidated risk-adjusted capitalization as strongest… supported by favorable financial flexibility, including significant excess liquidity…Athene’s favorable business profile
Slide 30: Historical Credit Loss Experience Outperforms Industry
6 13 3 17 16 8 14 6 20 18 COVID-19 Russia/Ukraine CRE/Regional Banking 30 Historical Credit Loss Experience Outperforms Industry Athene1 Industry2 Historical Asset Impairments (annualized, bps) 20203 2021 202320222019 1. Athene’s statutory fixed income impairments adjusted to include changes in mort
Slide 31: Risk Management is Embedded in Everything We Do
31 Robust risk management framework and procedures underpin focus on protecting capital and aligning risks with stakeholder expectations Risk strategy, investment, credit, asset-liability management (“ALM”) and liquidity risk policies, amongst others, at the board and management levels Stress testin
Slide 32: Athene is Committed to Transparency and Ongoing Disclosure
Athene Financial Supplement published quarterly Athene publishes 10-K’s and 10-Q’s as a ’34 Act SEC filer Parent company, Apollo Global Management, Inc., publishes 10-K’s and 10-Q’s as a ’34 Act SEC filer Statutory filings for main Athene operating subsidiaries, including Bermuda, available via IR w
Slide 33: Non-GAAP Definitions
Non-GAAP Definitions In addition to our results presented in accordance with accounting principles generally accepted in the United States of America (US GAAP), we present certain financial information that includes non-GAAP measures. Management believes the use of these non-GAAP measures, together
Slide 34: Non-GAAP Measures & Definitions
Non-GAAP Measures & Definitions 34 Adjusted Senior Debt-to-Capital Ratio Adjusted senior debt-to-capital ratio is a non-GAAP measure used to evaluate our capital structure excluding the impacts of AOCI and the cumulative changes in fair value of funds withheld and modco reinsurance assets as well as
Slide 35: Non-GAAP Measures & Definitions: Assets Under Management
Non-GAAP Measures & Definitions 35 Assets Under Management Assets Under Management, or AUM, refers to the assets of the funds, partnerships and accounts to which Apollo provides investment management, advisory, or certain other investment-related services, including, without limitation, capital that
Slide 36: Reconciliation of Debt-to-Capital Ratio to Adjusted Senior Debt-to-Capital Ratio
36 RECONCILIATION OF DEBT-TO-CAPITAL RATIO TO ADJUSTED SENIOR DEBT-TO-CAPITAL RATIO December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 September 30, 2024 Total debt $ 1,976 $ 2,964 $ 3,658 $ 4,209 $ 5,725 Less: Subordinated debt — — — — 575 Less: Adjustment to arrive at notional
Slide 37: Non-GAAP Measure Reconciliations
Non-GAAP Measure Reconciliations (In millions) 37 RECONCILIATION OF NET INCOME (LOSS) AVAILABLE TO AHL COMMON STOCKHOLDER TO SPREAD RELATED EARNINGS, EXCLUDING NOTABLE ITEMS Year ended December 31 Twelve months ended September 30, 2024 Nine months ended September 30, 20242019 2020 2021 2022 2023 Net
Slide 38: Reconciliation of Total Investments to Net Invested Assets
38 RECONCILIATION OF TOTAL INVESTMENTS, INCLUDING RELATED PARTIES, TO NET INVESTED ASSETS September 30, 2024 Total investments, including related parties $ 286,102 Derivative assets (7,529) Cash and cash equivalents (including restricted cash) 14,551 Accrued investment income 2,695 Net receivable (p
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