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, Athene has established a significant base of earnings and assets, positioning it well to capitalize on the increasing demand for retirement solutions.

Robust Organic Growth Across Channels Athene’s organic channels, including retail, flow reinsurance, and institutional products, generated impressive gross inflows of $71.0 billion in 2024, up 12% from 2023. This growth reflects the strength of Athene’s multi-channel distribution platform and its ability to quickly adapt to market opportunities.

Within the retail channel, Athene achieved record sales of its fixed indexed annuities (FIAs) and registered index-linked annuities (RILAs), driven by its disciplined pricing approach, diverse product offerings, and expanding relationships with independent marketing organizations (IMOs), banks, and broker-dealers. The company’s flow reinsurance channel also continued to provide an opportunistic source of liabilities, although inflows decreased in 2024 due to increased competition.

Athene’s institutional channel saw a significant increase in funding agreement inflows, which more than offset a decline in pension group annuity inflows. The company issued a record $28.7 billion in funding agreements in 2024, taking advantage of favorable market conditions and its strong reputation as a reliable counterparty.

Successful Inorganic Growth Strategy In addition to its organic growth, Athene has also leveraged its inorganic channel to drive expansion. The company’s corporate development team, supported by parent company Apollo, has demonstrated an industry-leading ability to source, underwrite, and expeditiously close transactions. Athene believes its inorganic channel will continue to be an important source of profitable growth in the future.

Innovative Capital Solutions To support its growth strategies and capital deployment opportunities, Athene has established two long-duration, on-demand capital vehicles – ACRA 1 and ACRA 2. These strategic capital solutions allow Athene the flexibility to simultaneously deploy capital across multiple accretive avenues while maintaining a strong financial position.

Diversified and High-Quality Investment Portfolio Athene’s investment portfolio, managed by Apollo, consists predominantly of high-quality fixed income assets, including corporate bonds, structured securities, and commercial and residential real estate loans. The company also maintains a diversified allocation to alternative investments, focusing on fixed income-like, cash flow-based strategies.

As of December 31, 2024, Athene’s total investments, including related parties and consolidated VIEs, stood at $315.0 billion, up from $259.3 billion a year earlier. The increase was driven by strong organic inflows, reinvestment of earnings, and favorable market impacts.

Athene’s investment portfolio is well-diversified, with 97.0% of its available-for-sale (AFS) securities considered investment grade based on NAIC designations. The company’s exposure to international issuers has also increased, reaching 40% of the AFS portfolio as of the end of 2024.

Prudent Risk Management and Liability Matching Athene’s investment strategy is closely aligned with the management of its long-duration liabilities. The company utilizes asset-liability management (ALM) modeling to manage interest rate risk, with a focus on sourcing assets that match the characteristics of its liabilities. Athene also maintains a significant allocation to floating-rate investments and hedging activities to mitigate interest rate sensitivity.

Solid Financial Performance and Profitability Athene’s financial performance in 2024 was strong, with net income available to common stockholders of $3.3 billion, down 27% from 2023 due to a decrease in revenues and an increase in income tax expense, partially offset by a decrease in benefits and expenses.

The company’s spread-related earnings (SRE), a key measure of profitability, increased by 4% to $3.2 billion in 2024. This was driven by higher net investment earnings and strategic capital management fees, partially offset by higher cost of funds and interest and other financing costs.

Athene’s net investment spread, a measure of the profitability of its investment portfolio, decreased slightly to 1.78% in 2024 from 1.93% in 2023. This was primarily due to higher cost of funds, partially offset by a higher net investment earned rate.

Outlook and Competitive Positioning Athene is well-positioned to continue its growth trajectory, both organically and inorganically, with a focus on international expansion, particularly in Asia. The company’s strong financial profile, diverse product offerings, and growing reputation as a reliable partner make it an attractive choice for consumers and industry participants seeking retirement solutions.

The aging population and increasing demand for retirement planning tools present significant opportunities for Athene. The company’s tax-efficient savings products, with features such as low-risk or guaranteed returns and potential equity market upside, are well-suited to meet this growing customer demand.

While Athene operates in highly competitive markets, its scale, diverse capabilities, and long-term relationships position it as a leader in the retirement services industry. The company’s focus on providing value-added services and building strong partnerships with distribution channels, such as IMOs, banks, and broker-dealers, further strengthens its competitive advantage.

Overall, Athene’s steady growth, diversification, and prudent risk management have positioned the company for continued success in the evolving retirement services landscape.