Athene’s Steady Growth and Diversification

Athene, a leading financial services company, has continued to demonstrate strong performance and growth in 2024. As a specialist in retirement savings products, the company has capitalized on the increasing demand for retirement solutions driven by demographic trends and economic conditions.

Solid Financial Results In 2024, Athene generated $20.7 billion in revenues, a decrease from $28.2 billion in 2023. This was primarily due to a decline in premiums, particularly in the pension group annuity business, as well as a decrease in other revenues. However, the company saw an increase in net investment income, investment-related gains, and VIE investment-related gains.

On the expense side, benefits and expenses decreased by $8.5 billion to $15.1 billion, driven by a decline in future policy and other policy benefits, partially offset by increases in interest sensitive contract benefits, policy and other operating expenses, and DAC, DSI and VOBA amortization.

Net income available to Athene Holding Ltd. common stockholder decreased by 27% to $3.3 billion in 2024, primarily due to the revenue decline, an increase in income tax expense, and higher net income attributable to noncontrolling interests.

Diversified Growth Channels Athene’s growth strategy focuses on both organic and inorganic channels. In 2024, the company’s organic channels, including retail, flow reinsurance, and institutional products, generated $71.0 billion in gross inflows, up 12% from 2023. This reflects the strength of Athene’s multi-channel distribution platform and its ability to pivot into optimal and profitable channels.

Within the retail channel, Athene had fixed annuity sales of $35.8 billion, driven by strong performance in its FIA and RILA products. The company aims to continue growing this channel by deepening relationships with its network of independent marketing organizations (IMOs), banks, and broker-dealers.

In the flow reinsurance channel, Athene generated $5.6 billion in inflows, down from $10.5 billion in 2023 due to increased competitive dynamics. The company continues to expand its presence in Asia through new partnerships and product offerings.

Athene’s institutional channel, which includes funding agreements and pension group annuities, saw inflows of $29.7 billion, up from $17.6 billion in 2023. Funding agreement inflows reached a record $28.7 billion, while pension group annuity inflows declined to $918 million due to a competitive environment and litigation against certain clients.

The company’s inorganic channel, which includes acquisitions and block reinsurance transactions, has also been an important source of growth. Athene believes its corporate development team, supported by parent company Apollo, has an industry-leading ability to source, underwrite, and execute transactions.

Robust Investment Portfolio Athene’s investment portfolio, including related parties and consolidated VIEs, grew to $315.0 billion as of December 31, 2024, up from $259.3 billion a year earlier. This growth was driven by strong organic inflows, reinvestment of earnings, and an increase in derivative assets, partially offset by unrealized losses on AFS securities due to rising interest rates.

The investment portfolio is primarily composed of high-quality fixed-income securities, such as corporate bonds, structured products, and commercial and residential real estate loans. Athene also maintains a strategic allocation to alternative investments, focusing on fixed income-like, cash flow-based opportunities.

Athene’s net invested assets, which directly back its net reserve liabilities and surplus assets, grew to $248.6 billion as of December 31, 2024, up from $217.4 billion in 2023. The company’s net investment earned rate increased to 5.03% in 2024, up from 4.61% in 2023, driven by higher returns in both the fixed-income and alternative investment portfolios.

Prudent Risk Management Athene’s investment strategy emphasizes disciplined risk management, with a focus on sourcing long-term, persistent liabilities and actively managing its asset portfolio to generate sustainable risk-adjusted returns. The company’s relationship with Apollo allows it to leverage the asset manager’s deep experience in sourcing and underwriting complex asset classes.

Athene’s investment portfolio is subject to various limits and protocols set forth in its Investment and Credit Risk Policy, which governs investments by asset class and issuer credit risk. The company also has a Strategic Investment Risk Policy that provides for special governance and risk management procedures for strategic investments.

Athene uses derivatives, such as fixed indexed options and foreign exchange contracts, to economically hedge its exposure to equity market risk, foreign exchange risk, and interest rate risk. The company transacts with highly rated counterparties and uses industry-standard agreements with bilateral collateral provisions to further reduce counterparty credit exposure.

Outlook and Strengths Looking ahead, Athene is well-positioned to continue its growth trajectory, both organically and inorganically. The company’s strong financial position, diverse product offerings, and expanding distribution channels provide a solid foundation for future success.

Athene’s key strengths include:

• Diversified growth channels: The company’s multi-channel distribution platform allows it to quickly pivot into optimal and profitable channels as market conditions evolve.
• Disciplined investment approach: Athene’s partnership with Apollo and its robust risk management framework enable the company to generate sustainable risk-adjusted returns.
• Reputation and industry leadership: Athene is a leading provider of annuities and retirement solutions, with a growing reputation as a reliable counterparty.
• Supportive capital structure: The company’s strategic capital solutions, such as ACRA 1 and ACRA 2, provide flexibility to deploy capital across multiple accretive avenues while maintaining a strong financial position.

Overall, Athene’s steady performance, diversified growth strategies, and prudent risk management position the company well to capitalize on the increasing demand for retirement solutions and continue its trajectory of profitable growth.