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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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90-0226248
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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1290 Avenue of the Americas, New York, New York
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10104
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Trading symbol
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Name of each exchange on which registered
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Common Stock
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EQH
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New York Stock Exchange
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Depositary Shares, each representing a 1/1,000th interest in a share of Fixed Rate Noncumulative Perpetual Preferred Stock, Series A
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EQH PR A
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New York Stock Exchange
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Large accelerated filer
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x
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Accelerated filer
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o
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Non-accelerated filer
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o
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Smaller reporting company
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o
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Emerging growth company
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o
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13 (a) of the Exchange Act. ¨
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•
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“AB” or “AllianceBernstein” means AB Holding and ABLP.
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“AB Holding” means AllianceBernstein Holding L.P., a Delaware limited partnership.
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“AB Holding Units” means units representing assignments of beneficial ownership of limited partnership interests in AB Holding.
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“AB Units” means units of limited partnership interests in ABLP.
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“ABLP” means AllianceBernstein L.P., a Delaware limited partnership and the operating partnership for the AB business.
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“ACS Life” means AXA Corporate Solutions Life Reinsurance Company, a Delaware corporation and a wholly-owned direct subsidiary of Holdings.
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“AEFS” means AXA Equitable Financial Services, LLC, a Delaware corporation and a wholly-owned direct subsidiary of Holdings.
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“AXA” means AXA S.A., a société anonyme organized under the laws of France, and formerly our controlling stockholder.
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“AXA Financial” means AXA Financial, Inc., a Delaware corporation and a former wholly-owned direct subsidiary of Holdings. On October 1, 2018, AXA Financial merged with and into Holdings, with Holdings assuming the obligations of AXA Financial.
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“AXA Tech” means AXA Technology Services America, Inc, formerly a Delaware corporation and wholly-owned subsidiary of Holdings which merged into Holdings in November 2019.
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“CS Life RE” means CS Life RE Company, an Arizona corporation and a wholly-owned indirect subsidiary of Holdings.
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“Equitable Advisors” means AXA Advisors, LLC, a Delaware limited liability company, our retail broker/dealer for our retirement and protection businesses and a wholly-owned indirect subsidiary of Holdings.
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“Equitable America” means Equitable Financial Life Insurance Company of America (f/k/a MONY Life Insurance Company of America), an Arizona corporation and a wholly-owned indirect subsidiary of Holdings.
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“Equitable Distributors” means AXA Distributors, LLC, a Delaware limited liability company, our wholesale broker/dealer for our retirement and protection businesses and a wholly-owned indirect subsidiary of Holdings.
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“Equitable FMG” means AXA Equitable Funds Management Group, LLC, a Delaware limited liability company and a wholly-owned indirect subsidiary of Holdings.
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“Equitable L&A” means AXA Equitable Life and Annuity Company, a Colorado corporation and a wholly-owned indirect subsidiary of Holdings.
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“Equitable Life” means AXA Equitable Life Insurance Company, a New York corporation, a life insurance company and a wholly-owned subsidiary of AEFS.
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“Equitable Network” means AXA Network, LLC, a Delaware limited liability company and wholly-owned indirect subsidiary of Holdings and its subsidiary, AXA Network of Puerto Rico, Inc.
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“Equitable Premier VIP Trust” means AXA Premier VIP Trust, a series trust that is a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “Investment Company Act”), as an open-end management investment company.
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“EQAT” means EQ Advisors Trust, a series trust that is a Delaware statutory trust and is registered under the Investment Company Act as an open-end management investment company.
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“EQ AZ Life Re” means EQ AZ Life Re Company, an Arizona corporation and a wholly-owned indirect subsidiary of Holdings.
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The “General Partner” means AllianceBernstein Corporation, a Delaware corporation and the general partner of AB Holding and ABLP.
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“SCB LLC” means Sanford C. Bernstein & Co., LLC, a registered investment adviser and broker-dealer.
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“USFL” means U.S. Financial Life Insurance Company, an Ohio corporation and a wholly-owned indirect subsidiary of Holdings.
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Advice and solutions for helping Americans set and meet their retirement goals and protect and transfer their wealth across generations; and
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A wide range of investment management insights, expertise and innovations to drive better investment decisions and outcomes for clients and institutional investors worldwide.
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Our affiliated retail sales force, Equitable Advisors, which has over 4,500 licensed financial professionals who advise on retirement, protection and investment advisory solutions; and
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More than 200 Bernstein Financial Advisors, who are responsible for the sale of investment products and solutions to Private Wealth Management clients.
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Distribution agreements with more than 1,000 third-party firms including broker-dealers, banks, insurance partners and brokerage general agencies, giving us access to more than 150,000 financial professionals to market our retirement, protection and investment solutions; and
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An AB global distribution team of more than 500 professionals, who engage with our approximately 5,000 retail distribution partners and more than 500 institutional clients.
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(1)
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We own an approximate 65% economic interest in AB. Our interests in AB are held through various wholly-owned subsidiaries, our economic interest consists of approximately 63% of the AB Units, approximately 4% of the AB Holding Units (representing an approximate 1% economic interest in ABLP), and 1% of the AB Units held by the GP. Our indirect, wholly-owned subsidiary, AllianceBernstein Corporation, is the General Partner of AB with the authority to manage and control AB, and accordingly, AB is consolidated in our financial statements. AB has been in the investment management and research business for more than 50 years. ABLP is the operating partnership for the AB business, and AB Holding’s activities consist of owning AB Units and engaging in related activities. AB Holding Units trade on the NYSE under the ticker symbol “AB”. AB Units do not trade publicly.
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Individual Retirement—We are a leading provider of variable annuity products, which primarily meet the needs of individuals saving for retirement or seeking retirement income by allowing them to invest in various markets through underlying investment options.
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Group Retirement—We offer tax-deferred investment and retirement services or products to plans sponsored by educational entities, municipalities and not-for-profit entities, as well as small and medium-sized businesses.
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Investment Management and Research—We are a leading provider of diversified investment management, research and related services to a broad range of clients around the world.
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Protection Solutions—We focus our life insurance products on attractive protection segments such as variable universal life (“VUL”) insurance and indexed universal life (“IUL”) insurance and our employee benefits business on small and medium-sized businesses.
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Structured Capital Strategies (“SCS”). Our index-linked variable annuity product allows the policyholder to invest in various investment options, whose performance is tied to one or more securities indices, commodities indices or exchange traded funds (“ETF”), subject to a performance cap, over a set period of time. The risks associated with such investment options are borne entirely by the policyholder, except the portion of any negative performance that we absorb (a buffer) upon investment maturity. This variable annuity does not offer GMxB features, other than an optional return of premium death benefit that we have introduced on some versions.
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Retirement Cornerstone. Our Retirement Cornerstone product offers two platforms: (i) RC Performance, which offers access to a broad selection of funds with annuitization benefits based solely on non-guaranteed account investment performance and (ii) RC Protection, which offers access to a focused selection of funds and an optional floating-rate GMxB feature providing guaranteed income for life, with a choice between two floating roll-up rate options.
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Investment Edge. Our investment-only variable annuity is a wealth accumulation variable annuity that defers current taxes during accumulation and provides tax-efficient distributions on non-qualified assets through scheduled payments over a set period of time with a portion of each payment being a return of cost basis, thus excludable from taxes. Investment Edge does not offer any GMxB feature other than an optional return of premium death benefit.
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Other products. We offer other products which offer optional GMxB benefits. These other products do not contribute significantly to our sales.
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Evolution of Variable Annuity FYP
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Years Ended December 31,
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2019
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2018
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2017
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(in millions)
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FYP by Product
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SCS
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$
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5,138
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$
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3,926
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$
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3,781
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Retirement Cornerstone
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2,156
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2,479
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2,522
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Investment Edge
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548
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537
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418
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Other
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349
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366
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374
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Total FYP
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$
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8,191
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$
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7,308
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$
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7,095
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Years Ended December 31,
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2019
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2018
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2017
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(in millions)
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FYP by Guarantee Feature
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Non-GMxB
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$
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5,728
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$
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4,640
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$
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4,622
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ROP Death Benefit Only
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551
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496
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276
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Total Non-GMxB & ROP Death Benefit Only
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$
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6,279
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$
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5,136
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$
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4,898
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Floating Rate GMxB
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1,864
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2,124
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2,108
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Fixed Rate GMxB
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48
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48
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89
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Total GMxB
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$
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1,912
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$
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2,172
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$
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2,197
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Total FYP
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$
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8,191
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$
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7,308
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$
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7,095
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As of December 31,
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2019
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2018
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2017
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(in millions)
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Account Value
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Non-GMxB
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$
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30,694
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$
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23,759
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$
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22,429
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ROP Death Benefit Only
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9,620
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8,730
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9,592
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Total Non-GMxB & ROP Death Benefit Only
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$
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40,314
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$
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32,489
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$
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32,021
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Floating Rate GMxB
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23,891
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20,633
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21,599
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Fixed Rate GMxB
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44,717
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41,467
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49,803
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Total Variable Annuity AV
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$
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108,922
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$
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94,589
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$
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103,423
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As of December 31,
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2019
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2018
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2017
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(in millions)
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Benefit Base
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ROP Death Benefit Only
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$
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6,048
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$
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6,072
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$
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6,281
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Floating Rate GMxB
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GMDB
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22,793
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21,924
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20,628
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GMIB
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22,108
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19,670
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18,412
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Fixed Rate GMxB
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GMDB
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59,365
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61,220
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62,702
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GMIB
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$
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61,775
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$
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63,431
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$
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64,673
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•
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The benefit base is defined to exclude the effects of a decline in the market value of the policyholder’s AV. Accordingly, actual claim payments to be made in the future to the policyholder will be determined without giving effect to market declines.
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The terms of the benefit base may allow it to increase at a guaranteed rate irrespective of the rate of return on the policyholder’s AV.
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GMDBs provide that in the event of the death of the policyholder, the beneficiary will receive the higher of the current contract account balance or the benefit base upon the death of the owner (or annuitant).
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GMIBs provide, if elected by the policyholder after a stipulated waiting period from contract issuance, guaranteed minimum annual lifetime payments based on predetermined guaranteed annuity purchase factors that may exceed what the contract AV can purchase at then-current annuity purchase rates.
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FYP by Distribution
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we primarily offer floating (tied to interest rates), as opposed to fixed, roll-up rates;
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we offer lower risk investment options, including passive investments and bond funds with reduced credit risk if certain optional guaranteed benefits are elected; and
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we offer managed volatility funds, which seek to reduce the risk of large, sudden declines in AV during market downturns by managing the volatility or draw-down risk of the underlying fund holdings through re-balancing the fund holdings within certain guidelines or overlaying hedging strategies at the fund level.
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Return of Premium Death Benefit. This death benefit pays the greater of the AV at the time of a claim following the owner’s death or the total contributions to the contract (subject to adjustment for withdrawals). The charge for this benefit is usually included in the Mortality & Expense charge that is deducted daily from the net assets in each variable investment option.
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RMD Wealthguard Death Benefit. This death benefit features a benefit base that does not decrease by the amount of any IRS-mandated withdrawals, or “required minimum distributions” (“RMD”), from the contract. The benefit base automatically increases to equal the highest AV on the current or any prior contract anniversary until RMD withdrawals begin or until the owner reaches a specified maximum age, even if the AV is reduced by negative investment performance. The charges for this benefit are calculated based on the benefit base value and deducted annually from the AV.
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Annual Ratchet (also referred to as Highest Anniversary Value). This death benefit features a benefit base that is reset each year to equal the higher of total contributions to the contract or the highest AV on the current or any prior contract anniversary (subject to adjustment for withdrawals), even if the AV is reduced by negative investment performance. The charge for this benefit is calculated based on the benefit base value and deducted annually from the AV.
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Roll-up Death Benefit. This death benefit features a benefit base that increases (or “rolls up”) at a specified guaranteed annual rate (subject to adjustment for withdrawals), even if the AV is reduced by negative investment performance. The charge for this benefit is calculated based on the benefit base value and deducted annually from the AV. This GMxB feature was discontinued in 2003.
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Greater of Roll-up or Annual Ratchet. This death benefit features a benefit base that increases each year to equal the higher of the initial benefit base accumulated at a specified guaranteed rate or the highest AV on the current or any prior contract anniversary (subject to adjustment for withdrawals), even if the AV is reduced by negative investment performance. The charge for this benefit is calculated based on the benefit base value and deducted annually from the AV.
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GWBL Standard Death Benefit. This death benefit features a benefit base that is equal to total contributions to the contract less a deduction reflecting the amount of any withdrawals made.
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GWBL Enhanced Death Benefit. This death benefit features a benefit base that is equal to total contributions to the contract plus the amounts of any ratchets and deferral bonus, less a deduction reflecting the amount of any withdrawals made. This benefit was available for an additional fee.
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As of December 31,
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2019
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2018
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2017
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Account
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Benefit
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Account
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Benefit
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Account
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Benefit
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Value
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Base
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Value
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Base
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Value
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Base
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(in millions)
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GMDB In-Force (1)
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ROP Death Benefit Only
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$
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9,620
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$
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6,048
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$
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8,730
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$
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6,072
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$
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9,592
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$
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6,281
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Floating Rate GMDB
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Greater of Ratchet or Roll-up
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7,017
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7,891
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6,310
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7,665
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6,880
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7,332
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All Other (2)
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16,874
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14,902
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14,323
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14,259
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14,720
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13,297
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Total Floating Rate GMDB
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$
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23,891
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$
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22,793
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$
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20,633
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|
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$
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21,924
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|
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$
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21,600
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$
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20,629
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Fixed Rate GMDB
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Greater of Ratchet or Roll-up
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$
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26,239
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$
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42,896
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|
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$
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24,242
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$
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43,422
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$
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29,061
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|
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$
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43,750
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All Other (2)
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18,478
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16,469
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17,225
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17,798
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20,742
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18,952
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Total Fixed Rate GMDB
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$
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44,717
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$
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59,365
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$
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41,467
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|
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$
|
61,220
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|
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$
|
49,803
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|
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$
|
62,702
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|
|
|
|
|
|
|
|
|
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Total GMDB
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$
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78,228
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|
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$
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88,206
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|
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$
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70,830
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|
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$
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89,216
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|
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$
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80,995
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|
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$
|
89,612
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(1)
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See table summarizing the NAR and reserves of policyholders by type of GMxB feature for variable annuity contracts as of December 31, 2019, 2018 and 2017 under “—Net Amount at Risk.”
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(2)
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All Other includes individual variable annuity policies with Annual Ratchet or Roll-up GMDB, either stand-alone or in conjunction with a GMLB, or with ROP GMDB in conjunction with a GMLB.
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GMIB. GMIB is our largest block of living benefit guarantees based on in-force AV. Policyholders who purchase the GMIB rider will be eligible, at the end of a defined waiting period, to receive annuity payments for life that will never be less than a guaranteed minimum amount, regardless of the performance of their investment options prior to the first payment. During this waiting period, which is often referred to as the accumulation phase of the contract, policyholders can invest their contributions in a range of variable and guaranteed investment options to grow their AV on a tax-deferred basis while increasing the value of the GMIB benefit base that helps determine the minimum annuity payment amount. Policyholders may elect to continue the accumulation phase beyond the waiting period if they wish to maintain the ability to take withdrawals from their AV or continue to participate in the growth of both their AV and GMIB benefit base.
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•
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GWBL. This benefit guarantees that a policyholder can take lifetime withdrawals from their contract up to a maximum amount per year without reducing their GWBL benefit base. The amount of each guaranteed annual withdrawal is
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•
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GMWB. This benefit guarantees that the policyholder can take withdrawals from their contract up to the amount of their total contributions, even if the AV subsequently falls to zero, provided that during each contract year total withdrawals do not exceed annual GMWB withdrawal amount that is calculated under the terms of the contract. The policyholder may choose either a 5% GMWB Annual withdrawal option or a 7% GMWB Annual withdrawal option. Annual withdrawal amounts are not cumulative year over year. The charge for the GMWB is calculated based on the GMWB benefit base value and deducted annually from the AV. We ceased offering GMWB riders in 2008.
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GMAB. This benefit guarantees that the AV can never fall below a minimum amount for a set period, which can also include locking in capital market gains. This rider protects the policyholder from market fluctuations. Two options we offered were a 100% principal guarantee and a 125% principal guarantee. Each option limited the policyholder to specified investment options. The charge for the GMAB is calculated based on the GMAB benefit base value and deducted annually from the AV. We ceased offering GMAB riders in 2008.
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GIB. This benefit provides the policyholder with a guaranteed lifetime annuity based on predetermined annuity purchase rates applied to a GIB benefit base, with annuitization automatically triggered if and when the contract AV falls to zero. The charge for the GIB is calculated based on the GIB benefit base value and deducted annually from the AV. We ceased offering the GIB in 2012.
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Lapse. The policyholder may lapse or exit the contract, at which time the GMIB and any other GMxB guarantees are terminated. If the policyholder partially exits, the GMIB benefit base and any other GMxB benefit bases will be reduced in accordance with the contract terms.
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•
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Dollar-for-Dollar Withdrawals. A policyholder may request a onetime withdrawal or take systematic withdrawals from his or her contract at any time. All withdrawals reduce a contract’s AV by the dollar amount of a withdrawal. However, the impact of withdrawals on the GMIB and any other guaranteed benefit bases may vary depending on the terms of the contract. Withdrawals will reduce guaranteed benefit bases on a dollar-for-dollar basis as long as the sum of withdrawals in a contract year is equal to or less than the dollar-for-dollar withdrawal threshold defined in the contract, beyond which all withdrawals are considered “excess withdrawals.” An excess withdrawal may reduce the guaranteed benefit bases on a pro rata basis, which can have a significantly adverse effect on their values. A policyholder wishing to take the maximum amount of dollar-for-dollar withdrawals on a systematic basis may sign up for our dollar-for-dollar withdrawal service at no additional charge. Withdrawals under this automated service will never result in a pro rata reduction of the guaranteed benefit bases, provided that no withdrawals are made outside the service. If making dollar-for-dollar withdrawals in combination with negative investment reduces the AV to zero, the contract may have a no-lapse guarantee that triggers the automatic exercise of the GMIB, providing the policyholder with a stream of lifetime annuity payments determined by the GMIB benefit base value, the age and gender of the annuitant and predetermined annuity purchase factors.
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•
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Voluntary Annuitization. The policyholder may choose to annuitize their AV or exercise their GMIB (if eligible). GMIB annuitization entitles the policyholder to receive a stream of lifetime (with or without period certain) annuity payments determined by the GMIB benefit base value, the age and gender of the annuitant and predetermined annuity purchase factors. GMIB annuitization cannot be elected past the maximum GMIB exercise age as stated in the contract, generally age 85 or 95. The policyholder may otherwise annuitize the AV and choose one of several payout options.
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•
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Convert to a GWBL. In some products, policyholders have the option to convert their GMIB into a GWBL to receive guaranteed income through a lifetime withdrawal feature. This choice can be made as an alternative to electing to annuitize at the maximum GMIB exercise age and may be appealing to policyholders who would prefer the ability to withdraw higher annual dollar-for-dollar amounts from their contract than permitted under the GMIB, for as long as their AV remains greater than zero.
|
•
|
Remain in Accumulation Phase. If the policyholder chooses to remain in the contract’s accumulation phase past the maximum GMIB exercise age—that is, by not electing annuitization or converting to a GWBL—and as long as the AV has not fallen to zero, then the GMIB will terminate and the contract will continue until the contractual maturity date.
|
|
As of December 31,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||||||||||||||
|
Account
|
|
Benefit
|
|
Account
|
|
Benefit
|
|
Account
|
|
Benefit
|
||||||||||||
|
Value
|
|
Base
|
|
Value
|
|
Base
|
|
Value
|
|
Base
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
GMLB In-Force (1)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Floating Rate GMLB
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
GMIB
|
$
|
20,699
|
|
|
$
|
22,108
|
|
|
$
|
16,728
|
|
|
$
|
19,670
|
|
|
$
|
17,840
|
|
|
$
|
18,412
|
|
Other (GIB)
|
2,812
|
|
|
3,128
|
|
|
3,581
|
|
|
4,214
|
|
|
3,439
|
|
|
3,664
|
|
||||||
Total Floating Rate GMLB
|
$
|
23,511
|
|
|
$
|
25,236
|
|
|
$
|
20,309
|
|
|
$
|
23,884
|
|
|
$
|
21,279
|
|
|
$
|
22,076
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed Rate GMLB
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
GMIB
|
$
|
38,846
|
|
|
$
|
61,775
|
|
|
$
|
36,326
|
|
|
$
|
63,431
|
|
|
$
|
43,900
|
|
|
$
|
64,673
|
|
All Other (e.g., GWBL / GMWB, GMAB, other) (2)
|
806
|
|
|
1,175
|
|
|
785
|
|
|
1,223
|
|
|
977
|
|
|
1,288
|
|
||||||
Total Fixed Rate GMLB
|
$
|
39,652
|
|
|
$
|
62,950
|
|
|
$
|
37,111
|
|
|
$
|
64,654
|
|
|
$
|
44,877
|
|
|
$
|
65,961
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total GMLB
|
$
|
63,163
|
|
|
$
|
88,186
|
|
|
$
|
57,420
|
|
|
$
|
88,538
|
|
|
$
|
66,156
|
|
|
$
|
88,037
|
|
(1)
|
See table summarizing the NAR and reserves of policyholders by type of GMxB feature for variable annuity contracts as of December 31, 2019, 2018 and 2017 under “—Net Amount at Risk.”
|
(2)
|
All Other includes individual variable annuity policies with stand-alone Annual Ratchet or stand-alone Roll-up GMDB.
|
|
As of December 31,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||||||||||||||
|
NAR
|
|
Reserves
|
|
NAR
|
|
Reserves
|
|
NAR
|
|
Reserves
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
GMIB
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Floating Rate GMIB
|
$
|
—
|
|
|
$
|
91
|
|
|
$
|
—
|
|
|
$
|
42
|
|
|
$
|
—
|
|
|
$
|
91
|
|
Fixed Rate GMIB
|
8,746
|
|
|
10,584
|
|
|
8,572
|
|
|
7,307
|
|
|
5,980
|
|
|
6,919
|
|
||||||
Total
|
$
|
8,746
|
|
|
$
|
10,675
|
|
|
$
|
8,572
|
|
|
$
|
7,349
|
|
|
$
|
5,980
|
|
|
$
|
7,010
|
|
(1)
|
U.S. GAAP reserves for ROP death benefit only are not available, as U.S. GAAP reserve valuation basis applies on policy contracts grouped by issue year.
|
•
|
Guaranteed Interest Option (“GIO”)—Provides a fixed interest rate and guaranteed AV.
|
•
|
Structured Investment Option (“SIO”)—Provides upside market participation that tracks either the S&P 500, Russell 2000 or the MSCI EAFE index subject to a performance cap, with a downside buffer that limits losses in the investment over a one, three or five-year investment horizon. This option leverages our innovative SCS individual annuity offering, and we believe that we are the only provider that offers this type of guarantee in the defined contribution markets today.
|
•
|
Personal Income Benefit—An optional GMxB feature that enables participants to obtain a guaranteed withdrawal benefit for life for an additional fee.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Net Flows
|
|
|
|
|
|
||||||
Gross Premiums
|
$
|
3,533
|
|
|
$
|
3,383
|
|
|
$
|
3,205
|
|
Surrenders, Withdrawals and Benefits
|
(3,266
|
)
|
|
(3,287
|
)
|
|
(2,938
|
)
|
|||
Net Flows
|
$
|
267
|
|
|
$
|
96
|
|
|
$
|
267
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Gross Premiums by Market
|
|
|
|
|
|
||||||
Tax-Exempt
|
$
|
902
|
|
|
$
|
911
|
|
|
$
|
872
|
|
Corporate
|
537
|
|
|
479
|
|
|
470
|
|
|||
Other
|
49
|
|
|
38
|
|
|
40
|
|
|||
Total FYP
|
1,488
|
|
|
1,428
|
|
|
1,382
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Tax-Exempt
|
1,531
|
|
|
1,450
|
|
|
1,330
|
|
|||
Corporate
|
330
|
|
|
319
|
|
|
293
|
|
|||
Other
|
184
|
|
|
186
|
|
|
200
|
|
|||
Total Renewal Premiums
|
2,045
|
|
|
1,955
|
|
|
1,823
|
|
|||
Gross Premiums
|
$
|
3,533
|
|
|
$
|
3,383
|
|
|
$
|
3,205
|
|
•
|
Tax-exempt 403(b)/457(b). We primarily serve individual employees of public school systems. To a lesser extent, we also market to government entities that sponsor 457(b) plans.
|
•
|
Corporate 401(k). We target small and medium-sized businesses with 401(k) plans that generally have under $20 million in assets. Our product offerings accommodate start up plans and plans with accumulated assets. Typically, our products appeal to companies with strong contribution flows and a smaller number of participants with relatively high average participant balances. The under $20 million asset plan market is well aligned with our advisor distribution, which has a strong presence in the small and medium-sized business market, and complements our other products focused on this market (such as life insurance and employee benefits products aimed at this market).
|
•
|
Other. Our other business includes an affinity-based direct marketing program where we offer retirement and individual products to employers that are members of industry or trade associations and various other sole proprietor and small business retirement accounts.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
FYP by Distribution
|
|
|
|
|
|
||||||
Equitable Advisors
|
$
|
1,341
|
|
|
$
|
1,277
|
|
|
$
|
1,226
|
|
Third-Party
|
147
|
|
|
151
|
|
|
161
|
|
|||
Total
|
$
|
1,488
|
|
|
$
|
1,428
|
|
|
$
|
1,387
|
|
|
Total General
|
||
Guaranteed Minimum Interest Rate
|
Account AV
|
||
|
(in billions)
|
||
1 – < 2%
|
$
|
3.1
|
|
2 – < 3%
|
1.3
|
|
|
3%
|
6.9
|
|
|
4%
|
0.2
|
|
|
Total
|
$
|
11.5
|
|
•
|
Institutional Services—servicing its institutional clients, including private and public pension plans, foundations and endowments, insurance companies, central banks and governments worldwide, and affiliates such as Holdings and its subsidiaries, by means of separately-managed accounts, sub-advisory relationships, structured products, collective investment trusts, mutual funds, hedge funds and other investment vehicles.
|
•
|
Retail Services—servicing its retail clients, primarily by means of retail mutual funds sponsored by AB or Equitable FMG, sub-advisory relationships with mutual funds sponsored by third parties, separately-managed account programs sponsored by financial intermediaries worldwide and other investment vehicles.
|
•
|
Private Wealth Management Services—servicing its private clients, including high net worth individuals and families, trusts and estates, charitable foundations, partnerships, private and family corporations, and other entities, by means of separately-managed accounts, hedge funds, mutual funds and other investment vehicles.
|
•
|
Bernstein Research Services—servicing institutional investors, such as pension fund, hedge fund and mutual fund managers, seeking high-quality fundamental research, quantitative services and brokerage-related services in equities and listed options.
|
•
|
Actively-managed equity strategies, with global and regional portfolios across capitalization ranges, concentration ranges and investment strategies, including value, growth and core equities
|
•
|
Actively-managed traditional and unconstrained fixed income strategies, including taxable and tax-exempt strategies;
|
•
|
Passive management, including index and enhanced index strategies;
|
•
|
Alternative investments, including hedge funds, fund of funds, direct lending and private equity; and
|
•
|
Multi-asset solutions and services, including dynamic asset allocation, customized target-date funds and target-risk funds.
|
|
As of December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in billions)
|
||||||||||
Institutions
|
$
|
282.7
|
|
|
$
|
246.3
|
|
|
$
|
269.3
|
|
Retail
|
239.2
|
|
|
180.8
|
|
|
192.9
|
|
|||
Private Wealth Management
|
101.0
|
|
|
89.3
|
|
|
92.3
|
|
|||
Total
|
$
|
622.9
|
|
|
$
|
516.4
|
|
|
$
|
554.5
|
|
|
As of December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in billions)
|
||||||||||
Equity
|
|
|
|
|
|
||||||
Actively Managed
|
$
|
177.2
|
|
|
$
|
136.2
|
|
|
$
|
139.4
|
|
Passively Managed (1)
|
60.1
|
|
|
50.2
|
|
|
54.3
|
|
|||
Total Equity
|
237.3
|
|
|
186.4
|
|
|
193.7
|
|
|||
|
|
|
|
|
|
||||||
Fixed Income
|
|
|
|
|
|
||||||
Actively Managed
|
|
|
|
|
|
||||||
Taxable
|
258.3
|
|
|
219.7
|
|
|
247.9
|
|
|||
Tax-exempt
|
47.1
|
|
|
41.7
|
|
|
40.4
|
|
|||
Total Actively Managed
|
305.4
|
|
|
261.4
|
|
|
288.3
|
|
|||
Passively Managed (1)
|
9.3
|
|
|
9.4
|
|
|
9.9
|
|
|||
Total Fixed Income
|
314.7
|
|
|
270.8
|
|
|
298.2
|
|
|||
|
|
|
|
|
|
||||||
Other (2)
|
|
|
|
|
|
||||||
Actively Managed
|
69.3
|
|
|
58.3
|
|
|
61.9
|
|
|||
Passively Managed (1)
|
1.6
|
|
|
0.9
|
|
|
0.7
|
|
|||
Total Other
|
70.9
|
|
|
59.2
|
|
|
62.6
|
|
|||
Total
|
$
|
622.9
|
|
|
$
|
516.4
|
|
|
$
|
554.5
|
|
(1)
|
Includes index and enhanced index services.
|
(2)
|
Includes certain multi-asset solutions and services and certain alternative investments.
|
|
Distribution Channel
|
||||||||||||||
|
Institutions
|
|
Retail
|
|
Private Wealth Management
|
|
Total
|
||||||||
|
(in billions)
|
||||||||||||||
Balance as of December 31, 2018
|
$
|
246.3
|
|
|
$
|
180.8
|
|
|
$
|
89.3
|
|
|
$
|
516.4
|
|
Long-term flows:
|
|
|
|
|
|
|
|
||||||||
Sales/new accounts
|
17.1
|
|
|
75.3
|
|
|
11.3
|
|
|
103.7
|
|
||||
Redemptions/terminations
|
(12.0
|
)
|
|
(44.0
|
)
|
|
(12.4
|
)
|
|
(68.4
|
)
|
||||
Cash flow/unreinvested dividends
|
(2.7
|
)
|
|
(7.5
|
)
|
|
0.1
|
|
|
(10.1
|
)
|
||||
Net long-term (outflows) inflows
|
2.4
|
|
|
23.8
|
|
|
(1.0
|
)
|
|
25.2
|
|
||||
Adjustments (3)
|
—
|
|
|
—
|
|
|
(0.9
|
)
|
|
(0.9
|
)
|
||||
Transfers
|
—
|
|
|
0.1
|
|
|
(0.1
|
)
|
|
—
|
|
||||
Market appreciation
|
34.0
|
|
|
34.5
|
|
|
13.7
|
|
|
82.2
|
|
||||
Net change
|
36.4
|
|
|
58.4
|
|
|
11.7
|
|
|
106.5
|
|
||||
Balance as of December 31, 2019
|
$
|
282.7
|
|
|
$
|
239.2
|
|
|
$
|
101.0
|
|
|
$
|
622.9
|
|
|
Distribution Channel
|
||||||||||||||
|
Institutions
|
|
Retail
|
|
Private Wealth Management
|
|
Total
|
||||||||
|
(in billions)
|
||||||||||||||
Balance as of December 31, 2017
|
$
|
269.3
|
|
|
$
|
192.9
|
|
|
$
|
92.3
|
|
|
$
|
554.5
|
|
Long-term flows:
|
|
|
|
|
|
|
|
||||||||
Sales/new accounts
|
26.1
|
|
|
54.2
|
|
|
13.5
|
|
|
93.8
|
|
||||
Redemptions/terminations
|
(30.1
|
)
|
|
(46.5
|
)
|
|
(11.0
|
)
|
|
(87.6
|
)
|
||||
Cash flow/unreinvested dividends
|
(6.0
|
)
|
|
(7.7
|
)
|
|
(0.6
|
)
|
|
(14.3
|
)
|
||||
Net long-term (outflows) inflows
|
(10.0
|
)
|
|
—
|
|
|
1.9
|
|
|
(8.1
|
)
|
||||
Transfers
|
0.2
|
|
|
0.2
|
|
|
(0.4
|
)
|
|
—
|
|
||||
Market depreciation
|
(13.2
|
)
|
|
(12.3
|
)
|
|
(4.5
|
)
|
|
(30.0
|
)
|
||||
Net change
|
(23.0
|
)
|
|
(12.1
|
)
|
|
(3.0
|
)
|
|
(38.1
|
)
|
||||
Balance as of December 31, 2018
|
$
|
246.3
|
|
|
$
|
180.8
|
|
|
$
|
89.3
|
|
|
$
|
516.4
|
|
|
Investment Services
|
||||||||||||||||||||||||||
|
Equity Actively Managed
|
|
Equity Passively Managed (1)
|
|
Fixed Income Actively Managed—Taxable
|
|
Fixed Income Actively Managed—Tax Exempt
|
|
Fixed Income Passively Managed (1)
|
|
Other (2)
|
|
Total
|
||||||||||||||
|
(in billions)
|
||||||||||||||||||||||||||
Balance as of December 31, 2018
|
$
|
136.2
|
|
|
$
|
50.2
|
|
|
$
|
219.7
|
|
|
$
|
41.7
|
|
|
$
|
9.4
|
|
|
$
|
59.2
|
|
|
$
|
516.4
|
|
Long-term flows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Sales/new accounts
|
34.7
|
|
|
0.5
|
|
|
53.0
|
|
|
10.0
|
|
|
0.1
|
|
|
5.4
|
|
|
103.7
|
|
|||||||
Redemptions/terminations
|
(26.4
|
)
|
|
(0.8
|
)
|
|
(31.5
|
)
|
|
(6.8
|
)
|
|
(0.4
|
)
|
|
(2.5
|
)
|
|
(68.4
|
)
|
|||||||
Cash flow/unreinvested dividends
|
(4.3
|
)
|
|
(3.8
|
)
|
|
(2.8
|
)
|
|
(0.2
|
)
|
|
(0.6
|
)
|
|
1.6
|
|
|
(10.1
|
)
|
|||||||
Net long-term (outflows) inflows
|
4.0
|
|
|
(4.1
|
)
|
|
18.7
|
|
|
3.0
|
|
|
(0.9
|
)
|
|
4.5
|
|
|
25.2
|
|
|||||||
Adjustments (3)
|
—
|
|
|
—
|
|
|
(0.4
|
)
|
|
(0.5
|
)
|
|
—
|
|
|
—
|
|
|
(0.9
|
)
|
|||||||
Market appreciation
|
37.0
|
|
|
14.0
|
|
|
20.3
|
|
|
2.9
|
|
|
0.8
|
|
|
7.2
|
|
|
82.2
|
|
|||||||
Net change
|
41.0
|
|
|
9.9
|
|
|
38.6
|
|
|
5.4
|
|
|
(0.1
|
)
|
|
11.7
|
|
|
106.5
|
|
|||||||
Balance as of December 31, 2019
|
$
|
177.2
|
|
|
$
|
60.1
|
|
|
$
|
258.3
|
|
|
$
|
47.1
|
|
|
$
|
9.3
|
|
|
$
|
70.9
|
|
|
$
|
622.9
|
|
|
Investment Services
|
||||||||||||||||||||||||||
|
Equity Actively Managed
|
|
Equity Passively Managed (1)
|
|
Fixed Income Actively Managed—Taxable
|
|
Fixed Income Actively Managed—Tax Exempt
|
|
Fixed Income Passively Managed (1)
|
|
Other (2)
|
|
Total
|
||||||||||||||
|
(in billions)
|
||||||||||||||||||||||||||
Balance as of December 31, 2017
|
$
|
139.4
|
|
|
$
|
54.3
|
|
|
$
|
247.9
|
|
|
$
|
40.4
|
|
|
$
|
9.9
|
|
|
$
|
62.6
|
|
|
$
|
554.5
|
|
Long-term flows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Sales/new accounts
|
36.7
|
|
|
4.0
|
|
|
27.6
|
|
|
7.9
|
|
|
0.1
|
|
|
17.5
|
|
|
93.8
|
|
|||||||
Redemptions/terminations
|
(22.2
|
)
|
|
(0.6
|
)
|
|
(40.8
|
)
|
|
(6.7
|
)
|
|
(0.6
|
)
|
|
(16.7
|
)
|
|
(87.6
|
)
|
|||||||
Cash flow/unreinvested dividends
|
(3.7
|
)
|
|
(3.6
|
)
|
|
(6.2
|
)
|
|
(0.4
|
)
|
|
0.2
|
|
|
(0.6
|
)
|
|
(14.3
|
)
|
|||||||
Net long-term (outflows) inflows
|
10.8
|
|
|
(0.2
|
)
|
|
(19.4
|
)
|
|
0.8
|
|
|
(0.3
|
)
|
|
0.2
|
|
|
(8.1
|
)
|
|||||||
Adjustments (3)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Market appreciation
|
(14.0
|
)
|
|
(3.9
|
)
|
|
(8.8
|
)
|
|
0.5
|
|
|
(0.2
|
)
|
|
(3.6
|
)
|
|
(30.0
|
)
|
|||||||
Net change
|
(3.2
|
)
|
|
(4.1
|
)
|
|
(28.2
|
)
|
|
1.3
|
|
|
(0.5
|
)
|
|
(3.4
|
)
|
|
(38.1
|
)
|
|||||||
Balance as of December 31, 2018
|
$
|
136.2
|
|
|
$
|
50.2
|
|
|
$
|
219.7
|
|
|
$
|
41.7
|
|
|
$
|
9.4
|
|
|
$
|
59.2
|
|
|
$
|
516.4
|
|
(1)
|
Includes index and enhanced index services.
|
(2)
|
Includes certain multi-asset solutions and services and certain alternative investments.
|
(3)
|
Approximately $900 million of non-investment management fee earning taxable and tax-exempt money market assets were removed from assets under management during the second quarter of 2019.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in billions)
|
||||||||||
Actively Managed
|
|
|
|
|
|
||||||
Equity
|
$
|
4.0
|
|
|
$
|
10.8
|
|
|
$
|
0.8
|
|
Fixed Income
|
21.7
|
|
|
(18.6
|
)
|
|
14.7
|
|
|||
Other
|
4.0
|
|
|
(0.1
|
)
|
|
3.6
|
|
|||
|
$
|
29.7
|
|
|
$
|
(7.9
|
)
|
|
$
|
19.1
|
|
Passively Managed
|
|
|
|
|
|
||||||
Equity
|
$
|
(4.1
|
)
|
|
$
|
(0.2
|
)
|
|
$
|
(4.3
|
)
|
Fixed Income
|
(0.9
|
)
|
|
(0.3
|
)
|
|
(1.7
|
)
|
|||
Other
|
0.5
|
|
|
0.3
|
|
|
0.1
|
|
|||
|
(4.5
|
)
|
|
(0.2
|
)
|
|
(5.9
|
)
|
|||
Total net long-term inflows (outflows)
|
$
|
25.2
|
|
|
$
|
(8.1
|
)
|
|
$
|
13.2
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in billions)
|
||||||||||
Distribution Channel:
|
|
|
|
|
|
||||||
Institutions
|
$
|
265.4
|
|
|
$
|
258.1
|
|
|
$
|
253.8
|
|
Retail
|
212.3
|
|
|
191.8
|
|
|
177.5
|
|
|||
Private Wealth Management
|
96.5
|
|
|
94.3
|
|
|
86.7
|
|
|||
Total
|
$
|
574.2
|
|
|
$
|
544.2
|
|
|
$
|
518.0
|
|
|
|
|
|
|
|
||||||
Investment Service:
|
|
|
|
|
|
||||||
Equity Actively Managed
|
$
|
158.4
|
|
|
$
|
146.4
|
|
|
$
|
125.6
|
|
Equity Passively Managed (1)
|
56.4
|
|
|
53.8
|
|
|
50.8
|
|
|||
Fixed Income Actively Managed – Taxable
|
239.7
|
|
|
230.3
|
|
|
236.3
|
|
|||
Fixed Income Actively Managed – Tax-exempt
|
44.6
|
|
|
41.3
|
|
|
38.8
|
|
|||
Fixed Income Passively Managed (1)
|
9.4
|
|
|
9.8
|
|
|
10.3
|
|
|||
Other (2)
|
65.7
|
|
|
62.6
|
|
|
56.2
|
|
|||
Total
|
$
|
574.2
|
|
|
$
|
544.2
|
|
|
$
|
518.0
|
|
(1)
|
Includes index and enhanced index services.
|
(2)
|
Includes certain multi-asset solutions and services and certain alternative investments.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Investment advisory and services fees:
|
|
|
|
|
|
||||||
Institutions
|
|
|
|
|
|
||||||
Base fees
|
$
|
451
|
|
|
$
|
445
|
|
|
$
|
430
|
|
Performance-based fees
|
28
|
|
|
33
|
|
|
45
|
|
|||
Total
|
479
|
|
|
478
|
|
|
475
|
|
|||
Retail:
|
|
|
|
|
|
||||||
Base fees
|
1,076
|
|
|
992
|
|
|
923
|
|
|||
Performance-based fees
|
23
|
|
|
18
|
|
|
24
|
|
|||
|
1,099
|
|
|
1,010
|
|
|
947
|
|
|||
Private Wealth Management:
|
|
|
|
|
|
||||||
Base fees
|
845
|
|
|
807
|
|
|
754
|
|
|||
Performance-based fees
|
49
|
|
|
67
|
|
|
25
|
|
|||
|
894
|
|
|
874
|
|
|
779
|
|
|||
Total:
|
|
|
|
|
|
|
|||||
Base fees
|
2,372
|
|
|
2,244
|
|
|
2,107
|
|
|||
Performance-based fees
|
100
|
|
|
118
|
|
|
94
|
|
|||
|
2,472
|
|
|
2,362
|
|
|
2,201
|
|
|||
Bernstein Research Services
|
408
|
|
|
439
|
|
|
450
|
|
|||
Distribution revenues
|
455
|
|
|
419
|
|
|
412
|
|
|||
Dividend and interest income
|
104
|
|
|
98
|
|
|
71
|
|
|||
Investment gains (losses)
|
39
|
|
|
3
|
|
|
92
|
|
|||
Other revenues
|
97
|
|
|
99
|
|
|
98
|
|
|||
Total revenues
|
3,575
|
|
|
3,420
|
|
|
3,324
|
|
|||
Less: Interest expense
|
57
|
|
|
53
|
|
|
25
|
|
|||
Net revenues
|
$
|
3,518
|
|
|
$
|
3,367
|
|
|
$
|
3,299
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Annualized Premium
|
|
|
|
|
|
||||||
Indexed Universal Life
|
$
|
77
|
|
|
$
|
81
|
|
|
$
|
82
|
|
Variable Universal Life
|
107
|
|
|
107
|
|
|
94
|
|
|||
Term
|
20
|
|
|
19
|
|
|
19
|
|
|||
Other (1)
|
2
|
|
|
3
|
|
|
3
|
|
|||
Total
|
$
|
206
|
|
|
$
|
210
|
|
|
$
|
198
|
|
(1)
|
For the individual life insurance in-force, other includes current assumption universal life insurance, whole life insurance and other products available for sale but not actively marketed.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
FYP by Product Line
|
|
|
|
|
|
||||||
Universal Life
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
4
|
|
Indexed Universal Life
|
203
|
|
|
216
|
|
|
219
|
|
|||
Variable Universal Life
|
181
|
|
|
176
|
|
|
163
|
|
|||
Term
|
20
|
|
|
19
|
|
|
19
|
|
|||
Other (1)
|
1
|
|
|
1
|
|
|
1
|
|
|||
Total
|
$
|
407
|
|
|
$
|
415
|
|
|
$
|
406
|
|
|
|
|
|
|
|
||||||
Renewals by Product Line
|
|
|
|
|
|
||||||
Universal Life
|
$
|
895
|
|
|
$
|
918
|
|
|
$
|
913
|
|
Indexed Universal Life
|
248
|
|
|
224
|
|
|
189
|
|
|||
Variable Universal Life
|
921
|
|
|
904
|
|
|
959
|
|
|||
Term
|
498
|
|
|
483
|
|
|
504
|
|
|||
Other (1)
|
22
|
|
|
24
|
|
|
27
|
|
|||
Total
|
$
|
2,584
|
|
|
$
|
2,553
|
|
|
$
|
2,592
|
|
|
|
|
|
|
|
||||||
Total Gross Premiums
|
$
|
2,991
|
|
|
$
|
2,968
|
|
|
$
|
2,998
|
|
(1)
|
For the individual life insurance in-force, other includes current assumption universal life insurance, whole life insurance and other products available for sale but not actively marketed.
|
|
As of December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in billions)
|
||||||||||
In-force face amount by product: (1)
|
|
|
|
|
|
||||||
Universal Life (2)
|
$
|
53.3
|
|
|
$
|
55.9
|
|
|
$
|
59.0
|
|
Indexed Universal Life
|
25.8
|
|
|
22.9
|
|
|
20.5
|
|
|||
Variable Universal Life (3)
|
127.5
|
|
|
127.3
|
|
|
128.9
|
|
|||
Term
|
233.5
|
|
|
234.9
|
|
|
235.9
|
|
|||
Whole Life
|
1.4
|
|
|
1.4
|
|
|
1.6
|
|
|||
Total in-force face amount
|
$
|
441.5
|
|
|
$
|
442.4
|
|
|
$
|
445.9
|
|
|
As of December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Protection Solutions Reserves (4)
|
|
|
|
|
|
||||||
General Account
|
$
|
17,298
|
|
|
$
|
17,562
|
|
|
$
|
17,296
|
|
Separate Accounts
|
13,616
|
|
|
11,393
|
|
|
12,643
|
|
|||
Total Protection Solutions Reserves
|
$
|
30,914
|
|
|
$
|
28,955
|
|
|
$
|
29,939
|
|
(1)
|
Does not include life insurance sold as part of our employee benefits business as it is a start-up business with a limited amount of in-force policies.
|
(2)
|
Universal life includes guaranteed universal life insurance products.
|
(3)
|
Variable universal life includes variable life insurance and corporate-owned life insurance.
|
(4)
|
Does not include Protection Solutions Reserves for our employee benefits business as it is a start-up business and therefore has immaterial in-force policies.
|
Shift in Product Sales (Annualized Premiums)
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Annualized Premium by Distribution
|
|
|
|
|
|
||||||
Equitable Advisors
|
$
|
157
|
|
|
$
|
165
|
|
|
$
|
157
|
|
Third-Party Firms
|
49
|
|
|
45
|
|
|
42
|
|
|||
Total
|
$
|
206
|
|
|
$
|
210
|
|
|
$
|
199
|
|
|
As of December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
ACS Life In-Force VA
|
|
|
|
|
|
||||||
GMDB
|
|
|
|
|
|
||||||
Policy Count (in thousands)
|
168
|
|
|
193
|
|
|
215
|
|
|||
Reinsured Account Value (in billions)
|
$
|
8
|
|
|
$
|
8
|
|
|
$
|
10
|
|
Net amount at risk (in millions)
|
$
|
410
|
|
|
$
|
1,040
|
|
|
$
|
637
|
|
Reserves (in millions)
|
$
|
76
|
|
|
$
|
82
|
|
|
$
|
95
|
|
|
|
|
|
|
|
||||||
GMIB
|
|
|
|
|
|
||||||
Policy Count (in thousands)
|
43
|
|
|
48
|
|
|
52
|
|
|||
Reinsured Account Value (in billions)
|
$
|
2
|
|
|
$
|
2
|
|
|
$
|
3
|
|
Net amount at risk (in millions)
|
$
|
312
|
|
|
$
|
362
|
|
|
$
|
281
|
|
Reserves (in millions)
|
$
|
186
|
|
|
$
|
183
|
|
|
$
|
194
|
|
•
|
changes in interest rates may reduce the spread on some of our products between the amounts that we are required to pay under the contracts and the rate of return we are able to earn on our General Account investments supporting the contracts. When interest rates decline, we have to reinvest the cash income from our investments in lower yielding instruments, potentially reducing net investment income. Since many of our policies and contracts have guaranteed minimum interest or crediting rates or limit the resetting of interest rates, the spreads could decrease and potentially become negative. When interest rates rise, we may not be able to quickly replace the assets in our General Account with higher yielding assets needed to fund the higher crediting rates necessary to keep these products and contracts competitive, which may result in higher lapse rates;
|
•
|
when interest rates rise rapidly, policy loans and surrenders and withdrawals of annuity contracts and life insurance policies may increase as policyholders seek to buy products with perceived higher returns, requiring us to sell investment assets potentially resulting in realized investment losses, or requiring us to accelerate the amortization of DAC, which could reduce our net income;
|
•
|
a decline in interest rates accompanied by unexpected prepayments of certain investments may result in reduced investment income and a decline in our profitability. An increase in interest rates accompanied by unexpected extensions of certain lower yielding investments may result in a decline in our profitability;
|
•
|
changes in the relationship between long-term and short-term interest rates may adversely affect the profitability of some of our products;
|
•
|
changes in interest rates could result in changes to the fair value of our GMIB reinsurance contracts asset, which could increase the volatility of our earnings. Higher interest rates reduce the value of the GMIB reinsurance contract asset which reduces our earnings, while lower interest rates increase the value of the GMIB reinsurance contract asset which increases our earnings;
|
•
|
changes in interest rates could result in changes to the fair value liability of our variable annuity GMxB business. Higher interest rates decrease the fair value liability of our GMxB variable annuity business, which increases our earnings; while lower interest rates increase the fair value liability of our GMxB variable annuity business, which decreases our earnings;
|
•
|
changes in interest rates may adversely impact our liquidity and increase our costs of financing and the cost of some of our hedges;
|
•
|
our mitigation efforts with respect to interest rate risk are primarily focused on maintaining an investment portfolio with diversified maturities that has a weighted average duration that is within an acceptable range of the duration of our estimated liability cash flow profile given our risk appetite. However, our estimate of the liability cash flow profile may turn out to be inaccurate. In addition, there are practical and capital market limitations on our ability to accomplish this objective. Due to these and other factors we may need to liquidate investments prior to maturity at a loss in order to satisfy liabilities or be forced to reinvest funds in a lower rate environment;
|
•
|
we may not be able to effectively mitigate, including through our hedging strategies, and we may sometimes choose based on economic considerations and other factors not to fully mitigate or to increase, the interest rate risk of our assets relative to our liabilities; and
|
•
|
for certain of our products, a delay between the time we make changes in interest rate and other assumptions used for product pricing and the time we are able to reflect these assumptions in products available for sale may negatively impact the long-term profitability of products sold during the intervening period.
|
•
|
adverse effects on our earnings;
|
•
|
additional demand on our existing employees;
|
•
|
unanticipated difficulties integrating operating facilities technologies and new technologies;
|
•
|
higher than anticipated costs related to integration;
|
•
|
existence of unknown liabilities or contingencies that arise after closing; and
|
•
|
potential disputes with counterparties.
|
•
|
we could experience long-term interruptions in our service and the services provided by our significant vendors due to the effects of catastrophic events. Some of our operational systems are not fully redundant, and our disaster recovery and business continuity planning cannot account for all eventualities. Additionally, unanticipated problems with our disaster recovery systems could further impede our ability to conduct business, particularly if those problems affect our computer-based data processing, transmission, storage and retrieval systems and destroy valuable data;
|
•
|
the outbreak of a pandemic disease, like the novel coronavirus COVID-19, could have a material adverse effect on our liquidity, financial condition and the operating results of our insurance business due to increased mortality and, in certain cases, morbidity rates and/or its impact on the economy and financial markets;
|
•
|
the occurrence of any pandemic disease, natural disaster, terrorist attack or any other catastrophic event that results in our workforce being unable to be physically located at one of our facilities could result in lengthy interruptions in our service;
|
•
|
a localized catastrophic event that affects the location of one or more of our corporate-owned or employer sponsored life insurance customers could cause a significant loss due to the corresponding mortality claims; and
|
•
|
a terrorist attack in the United States could have long-term economic impacts that may have severe negative effects on our investment portfolio, including loss of AUM and losses due to significant volatility, and disrupt our business operations. Any continuous and heightened threat of terrorist attacks could also result in increased costs of reinsurance.
|
•
|
Market Factors. Global financial markets performed very well in 2019, supported by three 25 basis point interest rate cuts from the U.S. Federal Reserve, which were designed to prevent negative impacts from global risks that emerged during the year. Other central banks around the world also provided additional monetary accommodation, boosting global financial markets broadly even as aggregate growth slowed in 2019 relative to 2018. Investor optimism about the eventual resolution of the trade dispute between the United States and China provided a significant boost to global equities in the fourth quarter of 2019. In addition, the Federal Reserve resumed expansion of its balance sheet late in the year, which has been viewed by many financial market participants as indicative of the central bank’s willingness to keep liquidity ample. Subdued inflation kept interest rates generally low, which supported both economic growth and strong financial market performance. Some key risks to market performance in 2020 we are considering include a
|
•
|
Client Preferences. Generally, AB’s clients may withdraw their assets at any time and on short notice. Also, changing market dynamics and investment trends, particularly with respect to sponsors of defined benefit plans choosing to invest in less risky investments and the ongoing shift to lower-fee passive services described below, may continue to reduce interest in some of the investment products AB offers, or clients and prospects may continue to seek investment products that AB may not currently offer. Loss of, or decreases in, AUM reduces AB’s investment advisory and services fees and revenues.
|
•
|
AB’s Investment Performance. AB’s ability to achieve investment returns for clients that meet or exceed investment returns for comparable asset classes and competing investment services is a key consideration when clients decide to keep their assets with AB or invest additional assets, and when a prospective client is deciding whether to invest with AB. Poor investment performance, both in absolute terms or relative to peers and stated benchmarks, may result in clients withdrawing assets and in prospective clients choosing to invest with competitors.
|
•
|
Investing Trends. AB’s fee rates vary significantly among the various investment products and services AB offers to its clients. For example, AB generally earns higher fees from assets invested in its actively-managed equity services than in its actively-managed fixed income services or passive services. Also, AB often earns higher fees from global and international services than AB does from U.S. services. An adverse mix shift would reduce AB’s investment advisory and services fees and revenues.
|
•
|
Service Changes. AB may be required to reduce its fee levels, restructure the fees it charges or adjust the services it offers to its clients because of, among other things, regulatory initiatives (whether industry-wide or specifically targeted), changing technology in the asset management business (including algorithmic strategies and emerging financial technology), court decisions and competitive considerations. A reduction in fees would reduce AB’s revenues.
|
•
|
industry or general market conditions;
|
•
|
domestic and international economic factors unrelated to our performance;
|
•
|
changes in our customers’ preferences;
|
•
|
new regulatory pronouncements and changes in regulatory guidelines;
|
•
|
lawsuits, enforcement actions and other claims by third parties or governmental authorities;
|
•
|
adverse publicity related to us or another industry participant;
|
•
|
actual or anticipated fluctuations in our operating results;
|
•
|
changes in securities analysts’ estimates of our financial performance or lack of research coverage and reports by industry analysts;
|
•
|
action by institutional stockholders or other large stockholders, including future sales of our common stock;
|
•
|
failure to meet any guidance given by us or any change in any guidance given by us, or changes by us in our guidance practices;
|
•
|
announcements by us of significant impairment charges;
|
•
|
speculation in the press or investment community;
|
•
|
investor perception of us and our industry;
|
•
|
changes in market valuations or earnings of similar companies;
|
•
|
announcements by us or our competitors of significant contracts, acquisitions, dispositions or strategic partnerships;
|
•
|
war, terrorist acts and epidemic disease;
|
•
|
any future sales of our common stock or other securities;
|
•
|
additions or departures of key personnel; and
|
•
|
misconduct or other improper actions of our employees.
|
•
|
authorize the issuance of shares of our common stock to create voting impediments or to frustrate persons otherwise seeking to affect a takeover or gain control;
|
•
|
authorize the issuance of “blank check” preferred stock that could be issued by our Board to thwart a takeover attempt;
|
•
|
provide that vacancies on our Board, including vacancies resulting from an enlargement of our Board, may be filled only by a majority vote of directors then in office;
|
•
|
prohibit stockholders from calling special meetings of stockholders;
|
•
|
prohibit stockholder action by written consent, thereby requiring all actions to be taken at a meeting of the stockholders;
|
•
|
establish advance notice requirements for nominations of candidates for election as directors or to bring other business before an annual meeting of our stockholders; and
|
•
|
require the approval of holders of at least 66 2⁄3% of the outstanding shares of our common stock to amend our amended and restated by-laws and certain provisions of our amended and restated certificate of incorporation.
|
•
|
any breach of the director’s duty of loyalty;
|
•
|
acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of the law;
|
•
|
under Section 174 of the DGCL (unlawful dividends); or
|
•
|
any transaction from which the director derives an improper personal benefit.
|
Period
|
Total Number of Shares (or Units) Purchased
|
|
Average Price Paid per Share (or Unit)
|
|
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Programs
|
|
Approximate Dollar Value of Shares (or Units) that May Yet Be Purchased Under the Program (1)
|
||||||
Month #1 (October 1-31)
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
163,466,738
|
|
Month #2 (November 1-30)
|
24,000,000
|
|
|
$
|
21.80
|
|
|
24,000,000
|
|
|
$
|
40,266,738
|
|
Month #3 (December 1-31)
|
1,618,167
|
|
|
$
|
24.78
|
|
|
1,618,167
|
|
|
$
|
170,664
|
|
Total
|
25,618,167
|
|
|
$
|
21.99
|
|
|
25,618,167
|
|
|
$
|
170,664
|
|
(1)
|
On November 6, 2019, Holdings’ Board of Directors approved a $400 million increase to Holdings’ share repurchase program.
|
|
May 14,
2018 |
|
Jun 30,
2018 |
|
Sep 30,
2018 |
|
Dec 31,
2018 |
|
Mar 31,
2019 |
|
Jun 30,
2019 |
|
Sep 30,
2019 |
|
Dec 31,
2019 |
||||||||||||||||
Equitable Holdings, Inc.
|
$
|
100.00
|
|
|
$
|
96.35
|
|
|
$
|
100.86
|
|
|
$
|
78.71
|
|
|
$
|
95.93
|
|
|
$
|
100.28
|
|
|
$
|
107.11
|
|
|
$
|
120.53
|
|
S&P 500
|
$
|
100.00
|
|
|
$
|
99.93
|
|
|
$
|
107.63
|
|
|
$
|
93.08
|
|
|
$
|
105.79
|
|
|
$
|
110.34
|
|
|
$
|
112.21
|
|
|
$
|
122.39
|
|
S&P 500 Financials
|
$
|
100.00
|
|
|
$
|
94.40
|
|
|
$
|
98.51
|
|
|
$
|
85.59
|
|
|
$
|
92.92
|
|
|
$
|
100.35
|
|
|
$
|
102.37
|
|
|
$
|
113.09
|
|
S&P 500 Insurance
|
$
|
100.00
|
|
|
$
|
95.88
|
|
|
$
|
102.59
|
|
|
$
|
91.70
|
|
|
$
|
103.47
|
|
|
$
|
115.60
|
|
|
$
|
117.15
|
|
|
$
|
118.64
|
|
|
Years Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
|
(in millions except per share data)
|
||||||||||||||||||
Statements of Income (Loss) Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
REVENUES
|
|
|
|
|
|
|
|
|
|
||||||||||
Policy charges and fee income
|
$
|
3,738
|
|
|
$
|
3,824
|
|
|
$
|
3,693
|
|
|
$
|
3,729
|
|
|
$
|
3,628
|
|
Premiums
|
1,147
|
|
|
1,094
|
|
|
1,124
|
|
|
1,083
|
|
|
1,070
|
|
|||||
Net derivative gains (losses)
|
(4,000
|
)
|
|
(231
|
)
|
|
214
|
|
|
(1,848
|
)
|
|
(1,404
|
)
|
|||||
Net investment income (loss)
|
3,699
|
|
|
2,693
|
|
|
3,082
|
|
|
2,665
|
|
|
2,450
|
|
|||||
Investment gains (losses), net:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total other-than-temporary impairment losses
|
—
|
|
|
(42
|
)
|
|
(15
|
)
|
|
(68
|
)
|
|
(42
|
)
|
|||||
Other investment gains (losses), net
|
73
|
|
|
(44
|
)
|
|
(176
|
)
|
|
2,051
|
|
|
27
|
|
|||||
Total investment gains (losses), net
|
73
|
|
|
(86
|
)
|
|
(191
|
)
|
|
1,983
|
|
|
(15
|
)
|
|||||
Investment management and service fees
|
4,380
|
|
|
4,268
|
|
|
4,093
|
|
|
3,749
|
|
|
3,895
|
|
|||||
Other income
|
554
|
|
|
516
|
|
|
445
|
|
|
402
|
|
|
419
|
|
|||||
Total revenues
|
$
|
9,591
|
|
|
$
|
12,078
|
|
|
$
|
12,460
|
|
|
$
|
11,763
|
|
|
$
|
10,043
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
BENEFITS AND OTHER DEDUCTIONS
|
|
|
|
|
|
|
|
|
|
||||||||||
Policyholders’ benefits
|
$
|
4,370
|
|
|
$
|
2,915
|
|
|
$
|
4,366
|
|
|
$
|
3,342
|
|
|
$
|
3,501
|
|
Interest credited to policyholders’ account balances
|
1,241
|
|
|
1,090
|
|
|
995
|
|
|
967
|
|
|
934
|
|
|||||
Compensation and benefits
|
2,081
|
|
|
2,079
|
|
|
1,980
|
|
|
1,965
|
|
|
2,008
|
|
|||||
Commissions and distribution-related payments
|
1,242
|
|
|
1,160
|
|
|
1,081
|
|
|
1,000
|
|
|
1,027
|
|
|||||
Interest expense
|
221
|
|
|
231
|
|
|
160
|
|
|
174
|
|
|
136
|
|
|||||
Amortization of deferred policy acquisition costs
|
579
|
|
|
333
|
|
|
503
|
|
|
779
|
|
|
431
|
|
|||||
Other operating costs and expenses
|
1,892
|
|
|
1,809
|
|
|
2,069
|
|
|
1,509
|
|
|
1,578
|
|
|||||
Total benefits and other deductions
|
11,626
|
|
|
9,617
|
|
|
11,154
|
|
|
9,736
|
|
|
9,615
|
|
|||||
Income (loss) from continuing operations, before income taxes
|
(2,035
|
)
|
|
2,461
|
|
|
1,306
|
|
|
2,027
|
|
|
428
|
|
|||||
Income tax (expense) benefit
|
599
|
|
|
(307
|
)
|
|
(49
|
)
|
|
(378
|
)
|
|
222
|
|
|||||
Net income (loss)
|
(1,436
|
)
|
|
2,154
|
|
|
1,257
|
|
|
1,649
|
|
|
650
|
|
|||||
Less: Net income (loss) attributable to the noncontrolling interest
|
297
|
|
|
334
|
|
|
423
|
|
|
395
|
|
|
325
|
|
|||||
Net income (loss) attributable to Holdings
|
(1,733
|
)
|
|
1,820
|
|
|
834
|
|
|
1,254
|
|
|
325
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
EARNINGS PER SHARE
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings per share - common stock:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
(3.51
|
)
|
|
$
|
3.27
|
|
|
$
|
1.49
|
|
|
$
|
2.24
|
|
|
$
|
0.58
|
|
Diluted
|
$
|
(3.51
|
)
|
|
$
|
3.27
|
|
|
$
|
1.48
|
|
|
$
|
2.24
|
|
|
$
|
0.58
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
493.6
|
|
|
556.4
|
|
|
561.0
|
|
|
561.0
|
|
|
561.0
|
|
|||||
Diluted
|
493.6
|
|
|
556.5
|
|
|
561.0
|
|
|
561.0
|
|
|
561.0
|
|
|||||
Cash dividends declared per common share
|
$
|
0.58
|
|
|
$
|
0.26
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
As of December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Balance Sheet Data (at period end):
|
|
|
|
|
|
|
|
|
|
||||||||||
Total investments
|
$
|
93,340
|
|
|
$
|
81,333
|
|
|
$
|
81,782
|
|
|
$
|
72,318
|
|
|
$
|
64,755
|
|
Separate Accounts assets
|
126,910
|
|
|
110,337
|
|
|
124,552
|
|
|
113,150
|
|
|
109,198
|
|
|||||
Total Assets
|
$
|
249,870
|
|
|
$
|
220,797
|
|
|
$
|
235,615
|
|
|
$
|
216,645
|
|
|
$
|
205,497
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Policyholders’ account balances
|
$
|
58,879
|
|
|
$
|
49,923
|
|
|
$
|
47,171
|
|
|
$
|
41,956
|
|
|
$
|
35,821
|
|
Future policy benefits and other policyholders’ liabilities
|
34,587
|
|
|
30,998
|
|
|
30,330
|
|
|
30,357
|
|
|
29,992
|
|
|||||
Short-term and long-term debt
|
4,111
|
|
|
4,955
|
|
|
2,408
|
|
|
1,605
|
|
|
1,786
|
|
|||||
Loans from affiliates
|
—
|
|
|
—
|
|
|
3,622
|
|
|
2,904
|
|
|
4,665
|
|
|||||
Separate Accounts liabilities
|
126,910
|
|
|
110,337
|
|
|
124,552
|
|
|
113,150
|
|
|
109,198
|
|
|||||
Total Liabilities
|
234,379
|
|
|
205,178
|
|
|
218,471
|
|
|
201,693
|
|
|
191,969
|
|
|||||
Redeemable noncontrolling interest
|
365
|
|
|
187
|
|
|
626
|
|
|
403
|
|
|
13
|
|
|||||
Total equity attributable to Holdings
|
13,535
|
|
|
13,866
|
|
|
13,421
|
|
|
11,407
|
|
|
10,407
|
|
|||||
Total equity attributable to Holdings, excluding Accumulated other comprehensive income (loss)
|
12,695
|
|
|
15,262
|
|
|
13,529
|
|
|
12,328
|
|
|
11,084
|
|
|||||
Noncontrolling interest
|
1,591
|
|
|
1,566
|
|
|
3,097
|
|
|
3,142
|
|
|
3,108
|
|
|||||
Total Equity
|
$
|
15,126
|
|
|
$
|
15,432
|
|
|
$
|
16,518
|
|
|
$
|
14,549
|
|
|
$
|
13,515
|
|
•
|
fee income derived from our retirement and protection products and our investment management and research services;
|
•
|
premiums from our traditional life insurance and annuity products; and
|
•
|
investment income from our General Account investment portfolio.
|
•
|
policyholders’ benefits and interest credited to policyholders’ account balances;
|
•
|
sales commissions and compensation paid to intermediaries and advisors that distribute our products and services; and
|
•
|
compensation and benefits provided to our employees and other operating expenses.
|
•
|
Variable annuity hedging programs. We use a dynamic hedging program (within this program, generally, we reevaluate our economic exposure at least daily and rebalance our hedge positions accordingly) to mitigate certain risks associated with the GMxB features that are embedded in our liabilities for our variable annuity products. This program utilizes various derivative instruments that are managed in an effort to reduce the economic impact of unfavorable changes in GMxB features’ exposures attributable to movements in the equity markets and interest rates. Although this program is designed to provide a measure of economic protection against the impact of adverse market conditions, it does not qualify for hedge accounting treatment. Accordingly, changes in value of the derivatives will be recognized in the period in which they occur with offsetting changes in reserves partially recognized in the current period, resulting in net income volatility. In addition to our dynamic hedging program, we have a hedging program using static hedge positions (derivative positions intended to be held to maturity with less frequent re-balancing) to protect our statutory capital against stress scenarios. This program in addition to our dynamic hedge program has increased the size of our derivative positions, resulting in an increase in net income volatility. The impacts are most pronounced for variable annuity products in our Individual Retirement segment. See “Business—Segment Information—Individual Retirement.”
|
•
|
GMIB reinsurance contracts. Historically, GMIB reinsurance contracts were used to cede to non-affiliated reinsurers a portion of our exposure to variable annuity products that offer a GMIB feature. We account for the GMIB reinsurance contracts as derivatives and report them at fair value. Gross GMIB reserves are calculated on the basis of assumptions related to projected benefits and related contract charges over the lives of the contracts. Accordingly, our gross reserves will not immediately reflect the offsetting impact on future claims exposure resulting from the same capital market or interest rate fluctuations that cause gains or losses on the fair value of the GMIB reinsurance contracts.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Impact of assumption updates on Net income (loss):
|
|
|
|
|
|
||||||
Variable annuity product features related assumption updates
|
$
|
(1,467
|
)
|
|
$
|
(366
|
)
|
|
$
|
(17
|
)
|
All other assumption updates
|
76
|
|
|
206
|
|
|
728
|
|
|||
Impact of assumption updates on Income (loss) from continuing operations, before income tax
|
$
|
(1,391
|
)
|
|
$
|
(160
|
)
|
|
$
|
711
|
|
Income tax (expense) benefit on assumption updates
|
292
|
|
|
29
|
|
|
(249
|
)
|
|||
Net income (loss) impact of assumption updates
|
$
|
(1,099
|
)
|
|
$
|
(131
|
)
|
|
$
|
462
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Impact of assumption updates by segment:
|
|
|
|
|
|
||||||
Individual Retirement
|
$
|
104
|
|
|
$
|
59
|
|
|
$
|
58
|
|
Group Retirement
|
3
|
|
|
43
|
|
|
47
|
|
|||
Protection Solutions
|
(4
|
)
|
|
107
|
|
|
623
|
|
|||
Impact of assumption updates on Corporate and Other
|
(27
|
)
|
|
(3
|
)
|
|
—
|
|
|||
Total impact on pre-tax Non-GAAP Operating Earnings
|
$
|
76
|
|
|
$
|
206
|
|
|
$
|
728
|
|
•
|
For the Individual Retirement segment, the impacts primarily reflect favorable updates to Amortization of DAC from lower lapse assumptions.
|
•
|
For the Group Retirement segment, the impacts primarily reflect a favorable update to maintenance expenses.
|
•
|
For the Protection Solutions segment, the results primarily reflect unfavorable updates to mortality and economic assumptions, partially offset by a favorable update to maintenance expenses.
|
•
|
For the Individual Retirement segment, the impacts primarily reflect favorable updates to DAC amortization from primarily lower annuitization assumptions and other policyholder behavior updates.
|
•
|
For the Group Retirement segment, the impacts primarily reflect a favorable update reflecting lower withdrawal rates.
|
•
|
For the Protection Solutions segment, the results primarily reflect favorable updates to surrender rates, expenses and General Account investment yields, partially offset by an increase in mortality assumptions. As a result of these changes, the variable and interest sensitive products in the Protection Solutions segment are no longer in loss recognition.
|
•
|
For the Individual Retirement and Group Retirement segments, the impacts primarily reflect favorable updates to the period over which DAC is amortized.
|
•
|
For the Protection Solutions segment, the impacts primarily reflect actuarial assumption updates and model changes, a maintenance expense assumption update, a mortality table update and loss recognition testing.
|
•
|
Certain of our variable annuity and life insurance products pay guaranteed minimum interest crediting rates. We are required to pay these guaranteed minimum rates even if earnings on our investment portfolio decline, with the resulting investment margin compression negatively impacting earnings. In addition, we expect more policyholders to hold policies with comparatively high guaranteed rates longer (lower lapse rates) in a low interest rate environment. Conversely, a rise in average yield on our investment portfolio should positively impact earnings. Similarly, we expect policyholders would be less likely to hold policies with existing guaranteed rates (higher lapse rates) as interest rates rise.
|
•
|
A prolonged low interest rate environment also may subject us to increased hedging costs or an increase in the amount of statutory reserves that our insurance subsidiaries are required to hold for GMxB features, lowering their statutory surplus, which would adversely affect their ability to pay dividends to us. In addition, it may also increase the perceived value of GMxB features to our policyholders, which in turn may lead to a higher rate of annuitization and higher persistency of those products over time. Finally, low interest rates may continue to cause an acceleration of DAC amortization or reserve increase due to loss recognition for interest sensitive products, primarily for our Protection Solutions segment.
|
•
|
Items related to variable annuity product features, which include certain changes in the fair value of the derivatives and other securities we use to hedge these features, the effect of benefit ratio unlock adjustments and changes in the fair value of the embedded derivatives reflected within variable annuity products’ net derivative results and the impact of these items on DAC amortization on our SCS product;
|
•
|
Investment (gains) losses, which includes other-than-temporary impairments of securities, sales or disposals of securities/investments, realized capital gains/losses and valuation allowances;
|
•
|
Goodwill impairment, which includes a write-down of goodwill in 2017.
|
•
|
Net actuarial (gains) losses, which includes actuarial gains and losses as a result of differences between actual and expected experience on pension plan assets or projected benefit obligation during a given period related to pension, other postretirement benefit obligations, and the one-time impact of the settlement of the defined benefit obligation;
|
•
|
Other adjustments, which includes restructuring costs related to severance, lease write-offs related to non-recurring restructuring activities, and separation costs; and
|
•
|
Income tax expense (benefit) related to the above items and non-recurring tax items, which includes the effect of uncertain tax positions for a given audit period, permanent differences due to goodwill impairment and the Tax Reform Act.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Net income (loss) attributable to Holdings
|
$
|
(1,733
|
)
|
|
$
|
1,820
|
|
|
$
|
834
|
|
Adjustments related to:
|
|
|
|
|
|
||||||
Variable annuity product features (1)
|
4,878
|
|
|
(70
|
)
|
|
1,107
|
|
|||
Investment (gains) losses
|
(73
|
)
|
|
86
|
|
|
191
|
|
|||
Goodwill impairment
|
—
|
|
|
—
|
|
|
369
|
|
|||
Net actuarial (gains) losses related to pension and other postretirement benefit obligations
|
99
|
|
|
215
|
|
|
135
|
|
|||
Other adjustments (2)
|
406
|
|
|
299
|
|
|
119
|
|
|||
Income tax expense (benefit) related to above adjustments (3)
|
(1,114
|
)
|
|
(111
|
)
|
|
(644
|
)
|
|||
Non-recurring tax items
|
(66
|
)
|
|
(73
|
)
|
|
(76
|
)
|
|||
Non-GAAP Operating Earnings (4)
|
$
|
2,397
|
|
|
$
|
2,166
|
|
|
$
|
2,035
|
|
(1)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, the adjustment related to Variable annuity product features for the years ended 2018 and 2017 would have been ($126) million and $1.1 billion.
|
(2)
|
Other adjustments include separation costs of $222 million, $213 million and $93 million in 2019, 2018 and 2017, respectively.
|
(3)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, the adjustment related to Income tax expense (benefit) related to above adjustments for the years ended 2018 and 2017 would have been ($99) million and ($634) million.
|
(4)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Non-GAAP Operating Earnings for the years ended 2018 and 2017 would have been $2.1 billion and $2.0 billion.
|
|
Year Ended December 31, 2019
|
||
|
(in millions)
|
||
Net income attributable to Holdings
|
$
|
(1,733
|
)
|
Average equity attributable to Holdings, excluding AOCI
|
$
|
13,253
|
|
Return on average equity attributable to Holdings, excluding AOCI
|
(13.1
|
)%
|
|
|
|
||
Non-GAAP Operating Earnings
|
$
|
2,397
|
|
Average equity attributable to Holdings, excluding AOCI
|
$
|
13,253
|
|
Non-GAAP Operating ROE
|
18.1
|
%
|
|
Individual Retirement
|
|
Group Retirement
|
|
Protection Solutions
|
||||||
|
(in millions)
|
||||||||||
Year Ended December 31, 2019
|
|
||||||||||
Operating earnings
|
$
|
1,577
|
|
|
$
|
390
|
|
|
$
|
396
|
|
Average capital (2)
|
$
|
7,362
|
|
|
$
|
1,335
|
|
|
$
|
2,995
|
|
Non-GAAP Operating ROC
|
21.4
|
%
|
|
29.2
|
%
|
|
13.2
|
%
|
|||
|
|
|
|
|
|
||||||
Year Ended December 31, 2018
|
|
|
|
|
|
||||||
Operating earnings (1)
|
$
|
1,555
|
|
|
$
|
389
|
|
|
$
|
197
|
|
Average capital (2)
|
$
|
6,921
|
|
|
$
|
1,227
|
|
|
$
|
2,656
|
|
Non-GAAP Operating ROC (3)
|
22.5
|
%
|
|
31.7
|
%
|
|
7.4
|
%
|
|||
|
|
|
|
|
|
||||||
Year Ended December 31, 2017
|
|
|
|
|
|
||||||
Operating earnings (1)
|
$
|
1,252
|
|
|
$
|
283
|
|
|
$
|
502
|
|
Average capital (2)
|
$
|
6,912
|
|
|
$
|
1,154
|
|
|
$
|
2,761
|
|
Non-GAAP Operating ROC (3)
|
18.1
|
%
|
|
24.5
|
%
|
|
18.2
|
%
|
(1)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Operating earnings for the years ended 2018 and 2017 for the Individual Retirement segment would have been $1.5 billion and $1.2 billion.
|
(2)
|
For average capital amounts by segment, capital components pertaining directly to specific segments such as DAC along with targeted capital are directly attributed to these segments. Targeted capital for each segment is established using assumptions supporting statutory capital adequacy levels (including CTE98).
|
(3)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Non-GAAP Operating ROC for the years ended 2018 and 2017 for the Individual Retirement segment would have been 21.8% and 17.6%.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(per share amounts)
|
||||||||||
Net income (loss) attributable to Holdings
|
$
|
(3.51
|
)
|
|
$
|
3.27
|
|
|
$
|
1.49
|
|
Adjustments related to:
|
|
|
|
|
|
||||||
Variable annuity product features (1)
|
9.86
|
|
|
(0.13
|
)
|
|
1.97
|
|
|||
Investment (gains) losses
|
(0.15
|
)
|
|
0.15
|
|
|
0.34
|
|
|||
Goodwill impairment
|
—
|
|
|
—
|
|
|
0.66
|
|
|||
Net actuarial (gains) losses related to pension and other postretirement benefit obligations
|
0.20
|
|
|
0.39
|
|
|
0.24
|
|
|||
Other adjustments (2)
|
0.83
|
|
|
0.54
|
|
|
0.22
|
|
|||
Income tax expense (benefit) related to above adjustments (3)
|
(2.25
|
)
|
|
(0.20
|
)
|
|
(1.15
|
)
|
|||
Non-recurring tax items
|
(0.13
|
)
|
|
(0.13
|
)
|
|
(0.14
|
)
|
|||
Non-GAAP Operating Earnings (4)
|
$
|
4.85
|
|
|
$
|
3.89
|
|
|
$
|
3.63
|
|
(1)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, the adjustment related to Variable annuity product features for the years ended 2018 and 2017 would have been ($0.23) and $1.89.
|
(2)
|
“Other adjustments” includes separation costs of $0.45, $0.38 and $0.17 for the years ended December 31, 2019, 2018 and 2017, respectively.
|
(3)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, the adjustment related to Income tax expense (benefit) related to above adjustments for the years ended 2018 and 2017 would have been ($0.18) and ($1.13).
|
(4)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Non-GAAP Operating EPS - common stock, diluted for the years ended 2018 and 2017 would have been $3.81 and $3.57.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions, except per share data)
|
||||||||||
REVENUES
|
|
|
|
|
|
||||||
Policy charges and fee income
|
$
|
3,738
|
|
|
$
|
3,824
|
|
|
$
|
3,693
|
|
Premiums
|
1,147
|
|
|
1,094
|
|
|
1,124
|
|
|||
Net derivative gains (losses)
|
(4,000
|
)
|
|
(231
|
)
|
|
214
|
|
|||
Net investment income (loss)
|
3,699
|
|
|
2,693
|
|
|
3,082
|
|
|||
Investment gains (losses), net:
|
|
|
|
|
|
||||||
Total other-than-temporary impairment losses
|
—
|
|
|
(42
|
)
|
|
(15
|
)
|
|||
Other investment gains (losses), net
|
73
|
|
|
(44
|
)
|
|
(176
|
)
|
|||
Total investment gains (losses), net
|
73
|
|
|
(86
|
)
|
|
(191
|
)
|
|||
Investment management and service fees
|
4,380
|
|
|
4,268
|
|
|
4,093
|
|
|||
Other income
|
554
|
|
|
516
|
|
|
445
|
|
|||
Total revenues
|
9,591
|
|
|
12,078
|
|
|
12,460
|
|
|||
|
|
|
|
|
|
||||||
BENEFITS AND OTHER DEDUCTIONS
|
|
|
|
|
|
||||||
Policyholders’ benefits
|
4,370
|
|
|
2,915
|
|
|
4,366
|
|
|||
Interest credited to policyholders’ account balances
|
1,241
|
|
|
1,090
|
|
|
995
|
|
|||
Compensation and benefits
|
2,081
|
|
|
2,079
|
|
|
1,980
|
|
|||
Commissions and distribution-related payments
|
1,242
|
|
|
1,160
|
|
|
1,081
|
|
|||
Interest expense
|
221
|
|
|
231
|
|
|
160
|
|
|||
Amortization of deferred policy acquisition costs
|
579
|
|
|
333
|
|
|
503
|
|
|||
Other operating costs and expenses
|
1,892
|
|
|
1,809
|
|
|
2,069
|
|
|||
Total benefits and other deductions
|
11,626
|
|
|
9,617
|
|
|
11,154
|
|
|||
Income (loss) from continuing operations, before income taxes
|
(2,035
|
)
|
|
2,461
|
|
|
1,306
|
|
|||
Income tax (expense) benefit
|
599
|
|
|
(307
|
)
|
|
(49
|
)
|
|||
Net income (loss)
|
(1,436
|
)
|
|
2,154
|
|
|
1,257
|
|
|||
Less: Net income (loss) attributable to the noncontrolling interest
|
297
|
|
|
334
|
|
|
423
|
|
|||
Net income (loss) attributable to Holdings
|
$
|
(1,733
|
)
|
|
$
|
1,820
|
|
|
$
|
834
|
|
|
|
|
|
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions, except per share data)
|
||||||||||
EARNINGS PER SHARE
|
|
|
|
|
|
||||||
Earnings per share - common stock:
|
|
|
|
|
|
||||||
Basic
|
$
|
(3.51
|
)
|
|
$
|
3.27
|
|
|
$
|
1.49
|
|
Diluted
|
$
|
(3.51
|
)
|
|
$
|
3.27
|
|
|
$
|
1.49
|
|
Weighted average common shares outstanding (in millions):
|
|
|
|
|
|
||||||
Basic
|
493.6
|
|
|
556.4
|
|
|
561.0
|
|
|||
Diluted
|
494.7
|
|
|
556.5
|
|
|
561.0
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Non-GAAP Operating Earnings (1)
|
$
|
2,397
|
|
|
$
|
2,166
|
|
|
$
|
2,035
|
|
(1)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Non-GAAP Operating Earnings for the years ended 2018 and 2017 would have been $2.1 billion and $2.0 billion.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Non-GAAP Operating EPS - common stock:
|
|
|
|
|
|
||||||
Basic (1)
|
$
|
4.86
|
|
|
$
|
3.89
|
|
|
$
|
3.63
|
|
Diluted (2)
|
$
|
4.85
|
|
|
$
|
3.89
|
|
|
$
|
3.63
|
|
(1)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Non-GAAP Operating EPS - common stock, basic for the years ended 2018 and 2017 would have been $3.81 and $3.57.
|
(2)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Non-GAAP Operating EPS - common stock, diluted for the years ended 2018 and 2017 would have been $3.81 and $3.57.
|
•
|
Increase in Net derivative losses of $3.8 billion mainly due to losses from freestanding derivatives reflecting lower interest rates in 2019, and an increase in the fair value of the GMIBNLG liability due to lower interest rates in 2019. The increase in Net derivative losses was partially offset by the smaller impact from unfavorable assumption updates ($0.6 billion in 2019 versus $1.1 billion in 2018).
|
•
|
Increase in Policyholders’ benefits of $1.5 billion mainly due to our Individual Retirement segment driven by the unfavorable impact from assumption updates ($890 million unfavorable in 2019 compared to $731 million favorable in 2018), and the impacts of lower interest rates and higher equity markets in 2019 versus 2018, partly offset by a decrease in our Protection Solutions segment driven by the favorable impact from assumption updates ($42 million favorable in 2019 compared to $53 million unfavorable in 2018).
|
•
|
Increase in Amortization of DAC of $246 million mainly due to increases in our Individual Retirement, Protection Solutions and Group Retirement segments. The increase in our Individual Retirement segment was primarily due to the impacts of lower interest rates and equity market movements in 2019 on assets supporting our SCS block, partially offset by the favorable impact from assumption updates ($92 million in 2019 versus $60 million in 2018). The increase in our Protection Solutions segment was mainly due to the unfavorable impact from assumption updates ($49 million unfavorable in 2019 compared to $183 million favorable in 2018). The increase in our Group Retirement segment was primarily due to the less favorable impact of assumption updates ($3 million in 2019 versus $43 million in 2018).
|
•
|
Increase in Interest credited to policyholders’ account balances of $151 million mainly driven by our Individual Retirement segment primarily attributable to higher SCS AV due to new business growth. This was partially offset by the favorable impact from assumption updates of $13 million, and an increase in Indexed Universal Life reserves due to new business in our Protection Solutions segment.
|
•
|
Increase in Compensation, benefits and other operating expenses of $85 million mainly driven by our Investment Management and Research segment resulting from higher employee compensation, promotion and servicing, and general and administrative expenses.
|
•
|
Increase in Commissions and distribution-related payments of $82 million mainly driven by higher commission expense due to higher distribution-related payments in our Investment Management and Research segment, as well as the growth in sales of non-proprietary and employee benefits products in our Protection Solutions segment.
|
•
|
Increase in Net investment income of $1.0 billion mainly due to a change in the market value of trading securities supporting our variable annuity products due to lower interest rates in 2019 compared to 2018, and higher investment income from higher asset balances and the General Account investment portfolio optimization.
|
•
|
Increase in Fee-type revenue of $117 million mainly driven by an increase in our Investment Management and Research segment attributable to higher base fees resulting from higher average AUM, the growth in sales of our employee benefits products and the favorable impacts from assumption updates ($3 million favorable in 2019 versus $24 million unfavorable in 2018) in our Protection Solutions segment, partially offset by a decrease in our Individual Retirement segment mainly due to lower average Separate Accounts AV in 2019 compared to 2018 resulting from a decline in equity markets in the fourth quarter of 2018 and net outflows in our older fixed-rate GMxB block.
|
•
|
Increase in Net investment gains of $159 million primarily due to the rebalancing of our U.S. Treasury portfolio, partially offset by a $134 million impairment on assets and liabilities held-for-sale.
|
•
|
Decrease in Net income attributable to noncontrolling interest of $37 million mainly due to lower AB Net income and from the increase in our ownership percentage of AB in 2019 that reduced the noncontrolling interest's share of AB's Net income.
|
•
|
Increase in Income tax benefit of $906 million driven primarily by a pre-tax loss in the year ended 2019 compared to pre-tax income in the year ended 2018 and by a $63 million income tax benefit from the release of a state income tax liability in the second quarter of 2019.
|
•
|
Increase in Net investment income of $440 million mainly due to the positive impacts from higher asset balances, the General Account investment portfolio optimization, and higher income from seed capital investment subject to market risk.
|
•
|
Increase in Net derivative gains of $107 million mainly due to a $180 million increase in our Individual Retirement segment largely offsetting the impact of lower interest rates on our GMxB liabilities in 2019.
|
•
|
Decrease in Policyholders’ benefits of $95 million mainly in our Protection Solution segment driven by the favorable impact from assumption updates ($42 million favorable in 2019 compared to $53 million unfavorable in 2018), partly
|
•
|
Decrease in Earnings attributable to the noncontrolling interest of $65 million mainly in our Investment Management and Research segment due to lower AB Operating earnings and from the increase in our ownership percentage of AB that reduced the noncontrolling interest’s share of AB’s Operating earnings.
|
•
|
Increase in Fee-type revenue of $39 million mainly driven by an increase in our Investment Management and Research segment attributable to higher base fees resulting from higher average AUM, the growth in sales of our employee benefits products and the favorable impact from assumption updates ($3 million favorable in 2019 versus $24 million unfavorable in 2018) in our Protection Solutions segment, partially offset by a decrease in our Individual Retirement segment mainly due to lower average Separate Accounts AV in 2019 compared to 2018 resulting from a decline in equity markets in the fourth quarter of 2018 and net outflows in our older fixed-rate GMxB block.
|
•
|
Increase in Interest credited to policyholders’ account balances of $151 million driven by our Individual Retirement segment primarily attributable to higher SCS AV due to new business growth partially offset by the favorable impact of assumption updates of $13 million in 2019, and an increase in Indexed Universal Life reserves due to new business in our Protection Solutions segment.
|
•
|
Increase in Amortization of DAC of $128 million due to increases in our Protection Solutions, Group Retirement and Individual Retirement segments. The increase in our Protection Solutions segment was mainly due to the unfavorable impact from assumption updates ($49 million unfavorable in 2019 versus $183 million favorable in 2018). The increase in our Group Retirement segment was primarily due to the less favorable impact from assumption updates ($3 million in 2019 compared to $43 million in 2018). The increase in our Individual Retirement segment was primarily due to the impact of lower interest rates and higher equity market movements on assets supporting our SCS block in 2019 versus 2018, partially offset by the favorable impact from assumption updates ($92 million in 2019 versus $60 million in 2018). Had we modified the treatment of the amortization of DAC for SCS starting in 2017, the SCS-related DAC amortization excluded from Non-GAAP Operating Earnings would have been $56 million lower, decreasing Non-GAAP Operating Earnings.
|
•
|
Increase in Commissions and distribution-related payments of $82 million mainly driven by higher distribution-related payments in our Investment Management and Research segment, as well as the growth in sales of non-proprietary and employee benefits products in our Protection Solutions segment.
|
•
|
Increase in Compensation, benefits and other operating costs and expenses of $52 million mainly driven by our Investment Management and Research segment resulting from higher employee compensation, promotion and servicing, and general and administrative expenses, partially offset by the non-recurrence of a $43 million expense related to the impact of adopting revenue recognition standard ASC 606 in the year ended 2018.
|
•
|
Increase in Income tax expense of $95 million mainly driven by higher pre-tax earnings in 2019. Had we modified the treatment of the amortization of DAC for SCS starting in 2017, the income tax benefit excluded from Non-GAAP Operating Earnings would have been $12 million lower.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Operating earnings (loss) by segment:
|
|
|
|
|
|
||||||
Individual Retirement (1)
|
$
|
1,577
|
|
|
$
|
1,555
|
|
|
$
|
1,252
|
|
Group Retirement
|
390
|
|
|
389
|
|
|
283
|
|
|||
Investment Management and Research
|
381
|
|
|
381
|
|
|
211
|
|
|||
Protection Solutions
|
396
|
|
|
197
|
|
|
502
|
|
|||
Corporate and Other
|
(347
|
)
|
|
(356
|
)
|
|
(213
|
)
|
|||
Non-GAAP Operating Earnings (2)
|
$
|
2,397
|
|
|
$
|
2,166
|
|
|
$
|
2,035
|
|
(1)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Operating earnings for the years ended 2018 and 2017 for the Individual Retirement segment would have been $1.5 billion and $1.2 billion.
|
(2)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Non-GAAP Operating Earnings for the years ended 2018 and 2017 would have been $2.1 billion and $2.0 billion.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Operating earnings (1)
|
$
|
1,577
|
|
|
$
|
1,555
|
|
|
$
|
1,252
|
|
(1)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Operating earnings for the years ended 2018 and 2017 for the Individual Retirement segment would have been $1.5 billion and $1.2 billion.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
REVENUES
|
|
|
|
|
|
||||||
Policy charges, fee income and premiums
|
$
|
2,085
|
|
|
$
|
2,124
|
|
|
$
|
2,116
|
|
Net investment income
|
1,148
|
|
|
981
|
|
|
865
|
|
|||
Investment gains (losses), net including derivative gains (losses)
|
377
|
|
|
197
|
|
|
654
|
|
|||
Investment management, service fees and other income
|
730
|
|
|
752
|
|
|
739
|
|
|||
Segment revenues
|
$
|
4,340
|
|
|
$
|
4,054
|
|
|
$
|
4,374
|
|
|
|
|
|
|
|
||||||
BENEFITS AND OTHER DEDUCTIONS
|
|
|
|
|
|
||||||
Policyholders' benefits
|
$
|
1,208
|
|
|
$
|
1,073
|
|
|
$
|
1,667
|
|
Interest credited to policyholders' account balances
|
288
|
|
|
229
|
|
|
174
|
|
|||
Commissions and distribution-related payments
|
281
|
|
|
291
|
|
|
281
|
|
|||
Amortization of deferred policy acquisition costs (1)
|
220
|
|
|
186
|
|
|
108
|
|
|||
Compensation, benefits and other operating costs and expenses
|
435
|
|
|
415
|
|
|
450
|
|
|||
Interest expense
|
—
|
|
|
—
|
|
|
—
|
|
|||
Segment benefits and other deductions (2)
|
$
|
2,432
|
|
|
$
|
2,194
|
|
|
$
|
2,680
|
|
(1)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Amortization of deferred policy acquisition costs for the years ended 2018 and 2017 for the Individual Retirement segment would have been $242 million and $154 million.
|
(2)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Segment benefits and other deductions for the years ended 2018 and 2017 for the Individual Retirement segment would have been $2.3 billion and $2.7 billion.
|
|
As of December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
AV
|
|
|
|
|
|
||||||
General Account
|
$
|
26,108
|
|
|
$
|
20,631
|
|
|
$
|
19,059
|
|
Separate Accounts
|
82,814
|
|
|
73,958
|
|
|
84,364
|
|
|||
Total AV
|
$
|
108,922
|
|
|
$
|
94,589
|
|
|
$
|
103,423
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Balance as of beginning of period
|
$
|
94,589
|
|
|
$
|
103,423
|
|
|
$
|
93,604
|
|
Gross premiums
|
8,572
|
|
|
7,893
|
|
|
7,786
|
|
|||
Surrenders, withdrawals and benefits
|
(9,071
|
)
|
|
(9,091
|
)
|
|
(7,854
|
)
|
|||
Net flows
|
(499
|
)
|
|
(1,198
|
)
|
|
(68
|
)
|
|||
Investment performance, interest credited and policy charges
|
15,290
|
|
|
(7,636
|
)
|
|
9,887
|
|
|||
Transfer to Corporate and Other
|
(458
|
)
|
|
—
|
|
|
—
|
|
|||
Balance as of end of period
|
$
|
108,922
|
|
|
$
|
94,589
|
|
|
$
|
103,423
|
|
•
|
Increase in Net investment income of $167 million mainly due to higher SCS asset balances and the General Account investment portfolio optimization.
|
•
|
Improvement in GMxB results of $71 million primarily due to assumption updates in the third quarter of 2018. GMxB results include Policy charges and fee income, Net derivative gains (losses) and Policyholders’ benefits.
|
•
|
Commissions and distribution-related payments decreased by $10 million due to lower asset balances.
|
•
|
Fee-type revenue decreased by $63 million mainly due to lower average Separate Accounts AV in 2019 compared to 2018 as a result of the sharp decline in equity markets in the fourth quarter of 2018, and net outflows in our older fixed-rate GMxB block.
|
•
|
Increase in Interest credited to policyholders’ account balances of $59 million primarily driven by higher SCS AV due to new business growth, partially offset by a $13 million favorable impact from assumption updates.
|
•
|
Increase in Amortization of DAC of $34 million, primarily due to the impact of interest rate and equity market movements on our SCS block in 2018 and higher normal amortization in 2019, partially offset by the favorable impact from assumption updates ($92 million in 2019 versus $60 million in 2018). Had we modified the treatment of the amortization of DAC for SCS starting in 2017, the SCS-related DAC amortization excluded from Operating earnings would have been $56 million lower.
|
•
|
Compensation, benefits and other operating costs and expenses increased by $20 million due to a one-time release of a legal fee reserve in 2018.
|
•
|
Non-GMxB related Policyholders’ benefits increased by $28 million mainly due to the normal growth of the Payout reserves.
|
•
|
Increase in Income tax expense of $26 million was driven by higher pre-tax earnings. Had the treatment in our Non-GAAP Operating Earnings measure of the Amortization of DAC for SCS been modified starting in 2017, income tax benefit excluded from Non-GAAP Operating Earnings would have been $12 million lower.
|
•
|
The higher in AV of $14.3 billion in 2019 was due primarily to higher equity markets and net outflows in our older fixed-rate GMxB block.
|
•
|
Net outflows of $499 million were $698 million higher than in 2018, mainly driven by $3.8 billion of outflows on our older fixed-rate GMxB block, which were partially offset by $3.3 billion of inflows on our newer, less capital-intensive products.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Operating earnings
|
$
|
390
|
|
|
$
|
389
|
|
|
$
|
283
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
REVENUES
|
|
|
|
|
|
||||||
Policy charges, fee income and premiums
|
$
|
279
|
|
|
$
|
271
|
|
|
$
|
248
|
|
Net investment income
|
590
|
|
|
552
|
|
|
528
|
|
|||
Investment gains (losses), net including derivative gains (losses)
|
4
|
|
|
2
|
|
|
(8
|
)
|
|||
Investment management, service fees and other income
|
204
|
|
|
194
|
|
|
174
|
|
|||
Segment revenues
|
$
|
1,077
|
|
|
$
|
1,019
|
|
|
$
|
942
|
|
|
|
|
|
|
|
||||||
BENEFITS AND OTHER DEDUCTIONS
|
|
|
|
|
|
||||||
Policyholders’ benefits
|
$
|
2
|
|
|
$
|
4
|
|
|
$
|
—
|
|
Interest credited to policyholders’ account balances
|
302
|
|
|
290
|
|
|
282
|
|
|||
Commissions and distribution-related payments
|
42
|
|
|
42
|
|
|
38
|
|
|||
Amortization of deferred policy acquisition costs
|
35
|
|
|
(7
|
)
|
|
23
|
|
|||
Compensation, benefits and other operating costs and expenses
|
224
|
|
|
225
|
|
|
230
|
|
|||
Interest expense
|
—
|
|
|
—
|
|
|
—
|
|
|||
Segment benefits and other deductions
|
$
|
605
|
|
|
$
|
554
|
|
|
$
|
573
|
|
|
As of December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
AV
|
|
|
|
|
|
||||||
General Account
|
$
|
12,071
|
|
|
$
|
11,619
|
|
|
$
|
11,319
|
|
Separate Accounts
|
25,809
|
|
|
20,782
|
|
|
22,587
|
|
|||
Total AV
|
$
|
37,880
|
|
|
$
|
32,401
|
|
|
$
|
33,906
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Balance as of beginning of period
|
$
|
32,401
|
|
|
$
|
33,906
|
|
|
$
|
30,138
|
|
Gross premiums
|
3,533
|
|
|
3,383
|
|
|
3,205
|
|
|||
Surrenders, withdrawals and benefits
|
(3,266
|
)
|
|
(3,287
|
)
|
|
(2,938
|
)
|
|||
Net flows
|
267
|
|
|
96
|
|
|
267
|
|
|||
Investment performance, interest credited and policy charges
|
5,212
|
|
|
(1,601
|
)
|
|
3,501
|
|
|||
Balance as of end of period
|
$
|
37,880
|
|
|
$
|
32,401
|
|
|
$
|
33,906
|
|
•
|
Net investment income increased by $38 million due to higher asset balances and the General Account investment portfolio optimization.
|
•
|
Increase in fee-type revenues of $18 million due to positive net flows and equity market performance in 2019.
|
•
|
Amortization of DAC increased by $42 million mainly due to the less favorable impact from assumption updates ($3 million in 2019 versus $43 million in 2018 which was driven by improved lapse experience).
|
•
|
Interest credited to policyholders’ account balances increased by $12 million due to AV growth.
|
•
|
The increase in AV of $5.5 billion in 2019 was primarily due to positive net flows and equity market performance in 2019.
|
•
|
Net inflows of $267 million increased $171 million, driven by record sales in the corporate market as well as strong renewals reflecting high retention in all markets.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Operating earnings
|
$
|
381
|
|
|
$
|
381
|
|
|
$
|
211
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
REVENUES
|
|
|
|
|
|
||||||
Policy charges, fee income and premiums
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment income
|
57
|
|
|
(10
|
)
|
|
60
|
|
|||
Investment gains (losses), net including derivative gains (losses)
|
(38
|
)
|
|
12
|
|
|
(24
|
)
|
|||
Investment management, service fees and other income
|
3,460
|
|
|
3,409
|
|
|
3,180
|
|
|||
Segment revenues
|
$
|
3,479
|
|
|
$
|
3,411
|
|
|
$
|
3,216
|
|
|
|
|
|
|
|
||||||
BENEFITS AND OTHER DEDUCTIONS
|
|
|
|
|
|
||||||
Policyholders’ benefits
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest credited to policyholders’ account balances
|
—
|
|
|
—
|
|
|
—
|
|
|||
Commissions and distribution related payments
|
488
|
|
|
427
|
|
|
415
|
|
|||
Amortization of deferred policy acquisition costs
|
—
|
|
|
—
|
|
|
—
|
|
|||
Compensation, benefits and other operating costs and expenses
|
2,174
|
|
|
2,115
|
|
|
2,036
|
|
|||
Interest expense
|
10
|
|
|
8
|
|
|
6
|
|
|||
Segment benefits and other deductions
|
$
|
2,672
|
|
|
$
|
2,550
|
|
|
$
|
2,457
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in billions)
|
||||||||||
Balance as of beginning of period
|
$
|
516.4
|
|
|
$
|
554.5
|
|
|
$
|
480.2
|
|
Long-term flows
|
|
|
|
|
|
||||||
Sales/new accounts
|
103.7
|
|
|
93.8
|
|
|
78.7
|
|
|||
Redemptions/terminations
|
(68.4
|
)
|
|
(87.6
|
)
|
|
(60.7
|
)
|
|||
Cash flow/unreinvested dividends
|
(10.1
|
)
|
|
(14.3
|
)
|
|
(4.8
|
)
|
|||
Net long-term (outflows) inflows
|
25.2
|
|
|
(8.1
|
)
|
|
13.2
|
|
|||
AUM adjustment (1)
|
(0.9
|
)
|
|
—
|
|
|
—
|
|
|||
Market appreciation (depreciation)
|
82.2
|
|
|
(30.0
|
)
|
|
61.1
|
|
|||
Net change
|
106.5
|
|
|
(38.1
|
)
|
|
74.3
|
|
|||
Balance as of end of period
|
$
|
622.9
|
|
|
$
|
516.4
|
|
|
$
|
554.5
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in billions)
|
||||||||||
Distribution Channel:
|
|
|
|
|
|
||||||
Institutions
|
$
|
265.4
|
|
|
$
|
258.1
|
|
|
$
|
253.8
|
|
Retail
|
212.3
|
|
|
191.8
|
|
|
177.5
|
|
|||
Private Wealth Management
|
96.5
|
|
|
94.3
|
|
|
86.7
|
|
|||
Total
|
$
|
574.2
|
|
|
$
|
544.2
|
|
|
$
|
518.0
|
|
|
|
|
|
|
|
||||||
Investment Service:
|
|
|
|
|
|
||||||
Equity Actively Managed
|
$
|
158.4
|
|
|
$
|
146.4
|
|
|
$
|
125.6
|
|
Equity Passively Managed (1)
|
56.4
|
|
|
53.8
|
|
|
50.8
|
|
|||
Fixed Income Actively Managed – Taxable
|
239.7
|
|
|
230.3
|
|
|
236.3
|
|
|||
Fixed Income Actively Managed – Tax-exempt
|
44.6
|
|
|
41.3
|
|
|
38.8
|
|
|||
Fixed Income Passively Managed (1)
|
9.4
|
|
|
9.8
|
|
|
10.3
|
|
|||
Other (2)
|
65.7
|
|
|
62.6
|
|
|
56.2
|
|
|||
Total
|
$
|
574.2
|
|
|
$
|
544.2
|
|
|
$
|
518.0
|
|
(1)
|
Includes index and enhanced index services.
|
(2)
|
Includes multi-asset solutions and services, and certain alternative investments.
|
•
|
Increase in Net investment income of $67 million mainly due to the seed capital investment subject to market risk.
|
•
|
Increase in fee-type revenues of $51 million primarily due to higher base fees driven by higher average AUM, partly offset by lower Bernstein Research Services revenues and lower performance-based fees mainly due to the non-recurrence of a $78 million increase in revenues in the year ended 2018 from the impact of adopting revenue recognition standard ASC 606 in 2018.
|
•
|
Earnings attributable to the noncontrolling interest decreased by $76 million due to lower AB Operating earnings and from the increase in our ownership percentage of AB that reduced the noncontrolling interests’ share of AB’s Operating earnings.
|
•
|
Higher commissions and distribution-related payments of $61 million due to higher payments to financial intermediaries for distribution of AB mutual funds.
|
•
|
Compensation, benefits and other operating costs and expenses increased $59 million primarily due to higher employee compensation, promotion and servicing, and general and administrative expenses, partially offset by the non-recurrence of a $43 million expense related to the impact of adopting revenue recognition standard ASC 606 in the year ended 2018.
|
•
|
Net derivative gains (losses) decreased $50 million primarily due to derivative losses economically hedging the seed capital investment subject to market risk.
|
•
|
Total AUM as of December 31, 2019 was $622.9 billion, up $106.5 billion, or 20.6 %, during 2019. The increase was driven by market appreciation of $82.2 billion, and net inflows of $25.2 billion (primarily due to Retail inflows of 23.8 billion).
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Operating earnings
|
$
|
396
|
|
|
$
|
197
|
|
|
$
|
502
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
REVENUES
|
|
|
|
|
|
||||||
Policy charges, fee income and premiums
|
$
|
2,107
|
|
|
$
|
2,103
|
|
|
$
|
1,995
|
|
Net investment income
|
967
|
|
|
901
|
|
|
850
|
|
|||
Investment gains (losses), net including derivative gains (losses)
|
10
|
|
|
5
|
|
|
—
|
|
|||
Investment management, service fees and other income
|
241
|
|
|
223
|
|
|
212
|
|
|||
Segment revenues
|
$
|
3,325
|
|
|
$
|
3,232
|
|
|
$
|
3,057
|
|
|
|
|
|
|
|
||||||
BENEFITS AND OTHER DEDUCTIONS
|
|
|
|
|
|
||||||
Policyholders’ benefits
|
$
|
1,603
|
|
|
$
|
1,827
|
|
|
$
|
965
|
|
Interest credited to policyholders’ account balances
|
520
|
|
|
481
|
|
|
466
|
|
|||
Commissions and distribution related payments
|
166
|
|
|
142
|
|
|
134
|
|
|||
Amortization of deferred policy acquisition costs
|
211
|
|
|
166
|
|
|
373
|
|
|||
Compensation, benefits and other operating costs and expenses
|
346
|
|
|
380
|
|
|
383
|
|
|||
Interest expense
|
—
|
|
|
—
|
|
|
—
|
|
|||
Segment benefits and other deductions
|
$
|
2,846
|
|
|
$
|
2,996
|
|
|
$
|
2,321
|
|
|
As of December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Protection Solutions Reserves (1)
|
|
|
|
|
|
||||||
General Account
|
$
|
17,298
|
|
|
$
|
17,562
|
|
|
$
|
17,296
|
|
Separate Accounts
|
13,616
|
|
|
11,393
|
|
|
12,643
|
|
|||
Total Protection Solutions Reserves
|
$
|
30,914
|
|
|
$
|
28,955
|
|
|
$
|
29,939
|
|
(1)
|
Does not include Protection Solutions Reserves for our employee benefits business as it is a start-up business and therefore has immaterial in-force policies.
|
|
As of December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in billions)
|
||||||||||
In-force face amount by product: (1)
|
|
|
|
|
|
||||||
Universal Life (2)
|
$
|
53.3
|
|
|
$
|
55.9
|
|
|
$
|
59.0
|
|
Indexed Universal Life
|
25.8
|
|
|
22.9
|
|
|
20.5
|
|
|||
Variable Universal Life (3)
|
127.5
|
|
|
127.3
|
|
|
128.9
|
|
|||
Term
|
233.5
|
|
|
234.9
|
|
|
235.9
|
|
|||
Whole Life
|
1.4
|
|
|
1.4
|
|
|
1.6
|
|
|||
Total in-force face amount
|
$
|
441.5
|
|
|
$
|
442.4
|
|
|
$
|
445.9
|
|
(1)
|
Includes individual life insurance and does not include employee benefits as it is a start-up business and therefore has immaterial in-force policies.
|
(2)
|
Universal Life includes Guaranteed Universal Life.
|
(3)
|
Variable Universal Life includes VL and COLI.
|
•
|
Decrease in Policyholders’ benefits of $224 million mainly driven by the favorable impact from assumption updates ($42 million favorable in 2019 compared to $53 million unfavorable in 2018), combined with improved mortality experience and a release in our profits followed by losses reserve.
|
•
|
Net investment income increased by $66 million primarily due to higher asset balances and the General Account investment portfolio optimization.
|
•
|
Compensation, benefits and other operating costs and expenses decreased by $34 million mainly due to the release of a litigation reserve and productivity initiatives.
|
•
|
Fee-type revenue increased by $22 million mainly driven by higher sales of non-proprietary and employee benefits products, and the favorable impact from assumption updates ($3 million favorable in 2019 compared to $24 million unfavorable in 2018), partially offset by an inforce update that reduced our policy charges and fee income (offset in amortization of DAC).
|
•
|
Increase in Amortization of DAC of $45 million mainly due to the unfavorable impact from assumption updates ($49 million unfavorable in 2019 compared to $183 million favorable in 2018 which was partially offset by a $123 million DAC write-off as we exited loss recognition in the second quarter of 2018), and an inforce update that reduced the amortization of DAC (offset in Policy charges and fee income) in 2019.
|
•
|
Interest credited to policyholders’ account balances increased $39 million primarily due to an increase in Indexed Universal Life reserves due to new business, partially offset by higher Net derivative gains.
|
•
|
Increase in Commissions and distribution-related payments of $24 million due to the growth in sales of non-proprietary and employee benefits products.
|
•
|
Income tax expense increased $44 million driven by higher pre-tax earnings.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Operating earnings (loss)
|
$
|
(347
|
)
|
|
$
|
(356
|
)
|
|
$
|
(213
|
)
|
|
Years Ended December 31,
|
|||||||||||||||||||
|
2019 (3)
|
|
2018
|
|
2017
|
|||||||||||||||
|
Yield
|
|
Amount (2)
|
|
Yield
|
|
Amount (2)
|
|
Yield
|
|
Amount (2)
|
|||||||||
|
(Dollars in millions)
|
|||||||||||||||||||
Fixed Maturities:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Income (loss)
|
3.68
|
%
|
|
$
|
2,019
|
|
|
3.86
|
%
|
|
$
|
1,732
|
|
|
3.77
|
%
|
|
$
|
1,628
|
|
Ending assets
|
|
|
62,687
|
|
|
|
|
46,447
|
|
|
|
|
45,751
|
|
||||||
Mortgages:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Income (loss)
|
4.47
|
%
|
|
541
|
|
|
4.26
|
%
|
|
494
|
|
|
4.38
|
%
|
|
454
|
|
|||
Ending assets
|
|
|
12,107
|
|
|
|
|
11,835
|
|
|
|
|
10,952
|
|
||||||
Real Estate Held for the Production of Income:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Interest expense and other
|
(5.04
|
)%
|
|
(2
|
)
|
|
(5.29
|
)%
|
|
(6
|
)
|
|
1.30
|
%
|
|
2
|
|
|||
Ending assets
|
|
|
27
|
|
|
|
|
52
|
|
|
|
|
390
|
|
||||||
Other Equity Investments (1):
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Income (loss)
|
6.33
|
%
|
|
88
|
|
|
10.08
|
%
|
|
133
|
|
|
14.37
|
%
|
|
169
|
|
|||
Ending assets
|
|
|
1,480
|
|
|
|
|
1,354
|
|
|
|
|
1,289
|
|
||||||
Policy Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Income (loss)
|
5.59
|
%
|
|
210
|
|
|
5.71
|
%
|
|
215
|
|
|
5.77
|
%
|
|
221
|
|
|||
Ending assets
|
|
|
3,735
|
|
|
|
|
3,779
|
|
|
|
|
3,819
|
|
||||||
Cash and Short-term Investments:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Income (loss)
|
(0.15
|
)%
|
|
(4
|
)
|
|
0.49
|
%
|
|
21
|
|
|
0.65
|
%
|
|
32
|
|
|||
Ending assets
|
|
|
1,856
|
|
|
|
|
3,332
|
|
|
|
|
4,539
|
|
||||||
Repurchase and funding agreements:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Interest expense and other
|
|
|
(110
|
)
|
|
|
|
(104
|
)
|
|
|
|
(71
|
)
|
||||||
Ending assets (liabilities)
|
|
|
(6,909
|
)
|
|
|
|
(4,561
|
)
|
|
|
|
(4,882
|
)
|
||||||
Total Invested Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Income (loss)
|
3.92
|
%
|
|
2,742
|
|
|
4.06
|
%
|
|
2,485
|
|
|
4.12
|
%
|
|
2,435
|
|
|||
Ending Assets
|
|
|
74,983
|
|
|
|
|
62,238
|
|
|
|
|
61,858
|
|
||||||
Short Duration Fixed Maturities:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Income (loss)
|
3.15
|
%
|
|
312
|
|
|
2.49
|
%
|
|
333
|
|
|
2.00
|
%
|
|
206
|
|
|||
Ending assets
|
|
|
6,173
|
|
|
|
|
14,818
|
|
|
|
|
11,945
|
|
||||||
Total:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Investment income (loss)
|
3.83
|
%
|
|
3,054
|
|
|
3.78
|
%
|
|
2,818
|
|
|
3.81
|
%
|
|
2,641
|
|
|||
Less: investment fees
|
(0.08
|
)%
|
|
(66
|
)
|
|
(0.08
|
)%
|
|
(62
|
)
|
|
(0.08
|
)%
|
|
(59
|
)
|
|||
Investment Income, Net
|
3.75
|
%
|
|
$
|
2,988
|
|
|
3.70
|
%
|
|
$
|
2,756
|
|
|
3.73
|
%
|
|
$
|
2,582
|
|
Ending Net Assets
|
|
|
$
|
81,156
|
|
|
|
|
$
|
77,056
|
|
|
|
|
$
|
73,803
|
|
(1)
|
Includes, as of December 31, 2019, 2018 and 2017 respectively, $338 million, $211 million and $25 million of other invested assets.
|
(2)
|
Amount for fixed maturities and mortgages represents original cost, reduced by repayments, write-downs, adjusted amortization of premiums, accretion of discount and valuation allowances. Cost for equity securities represents original cost reduced by write-downs; cost for other limited partnership interests represents original cost adjusted for equity in earnings and reduced by distributions.
|
(3)
|
December 31, 2019 excludes assets reclassified to Held-for-Sale of $1.0 billion and income of $38 million.
|
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Fair Value
|
|
Percentage of Total (%)
|
|||||||||
|
(in millions)
|
|
|
|||||||||||||||
As of December 31, 2019 (3)
|
|
|
|
|
|
|
|
|
|
|||||||||
Corporate Securities:
|
|
|
|
|
|
|
|
|
|
|||||||||
Finance
|
$
|
12,015
|
|
|
$
|
469
|
|
|
$
|
4
|
|
|
$
|
12,480
|
|
|
19
|
%
|
Manufacturing
|
12,643
|
|
|
706
|
|
|
9
|
|
|
13,340
|
|
|
20
|
%
|
||||
Utilities
|
4,999
|
|
|
302
|
|
|
8
|
|
|
5,293
|
|
|
8
|
%
|
||||
Services
|
6,730
|
|
|
386
|
|
|
17
|
|
|
7,099
|
|
|
11
|
%
|
||||
Energy
|
3,772
|
|
|
189
|
|
|
14
|
|
|
3,947
|
|
|
6
|
%
|
||||
Retail and wholesale
|
3,515
|
|
|
183
|
|
|
7
|
|
|
3,691
|
|
|
6
|
%
|
||||
Transportation
|
1,793
|
|
|
115
|
|
|
3
|
|
|
1,905
|
|
|
3
|
%
|
||||
Other
|
198
|
|
|
8
|
|
|
—
|
|
|
206
|
|
|
—
|
%
|
||||
Total corporate securities
|
45,665
|
|
|
2,358
|
|
|
62
|
|
|
47,961
|
|
|
73
|
%
|
||||
U.S. government
|
14,395
|
|
|
1,289
|
|
|
305
|
|
|
15,379
|
|
|
23
|
%
|
||||
Residential mortgage-backed (2)
|
178
|
|
|
13
|
|
|
—
|
|
|
191
|
|
|
—
|
%
|
||||
Preferred stock
|
501
|
|
|
17
|
|
|
5
|
|
|
513
|
|
|
1
|
%
|
||||
State & municipal
|
638
|
|
|
70
|
|
|
3
|
|
|
705
|
|
|
1
|
%
|
||||
Foreign governments
|
462
|
|
|
35
|
|
|
5
|
|
|
492
|
|
|
1
|
%
|
||||
Asset-backed securities
|
848
|
|
|
4
|
|
|
3
|
|
|
849
|
|
|
1
|
%
|
||||
Total
|
$
|
62,687
|
|
|
$
|
3,786
|
|
|
$
|
383
|
|
|
$
|
66,090
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||||
As of December 31, 2018
|
|
|
|
|
|
|
|
|
|
|||||||||
Corporate Securities:
|
|
|
|
|
|
|
|
|
|
|||||||||
Finance
|
$
|
6,343
|
|
|
$
|
77
|
|
|
$
|
124
|
|
|
$
|
6,296
|
|
|
14
|
%
|
Manufacturing
|
9,123
|
|
|
105
|
|
|
273
|
|
|
8,955
|
|
|
20
|
%
|
||||
Utilities
|
4,413
|
|
|
80
|
|
|
121
|
|
|
4,372
|
|
|
9
|
%
|
||||
Services
|
4,317
|
|
|
52
|
|
|
102
|
|
|
4,267
|
|
|
9
|
%
|
||||
Energy
|
2,347
|
|
|
40
|
|
|
75
|
|
|
2,312
|
|
|
5
|
%
|
||||
Retail and wholesale
|
2,163
|
|
|
19
|
|
|
49
|
|
|
2,133
|
|
|
5
|
%
|
||||
Transportation
|
1,357
|
|
|
29
|
|
|
54
|
|
|
1,332
|
|
|
3
|
%
|
||||
Other
|
171
|
|
|
4
|
|
|
2
|
|
|
173
|
|
|
—
|
%
|
||||
Total corporate securities
|
30,234
|
|
|
406
|
|
|
800
|
|
|
29,840
|
|
|
65
|
%
|
||||
U.S. government and agency
|
13,989
|
|
|
295
|
|
|
470
|
|
|
13,814
|
|
|
30
|
%
|
||||
Residential mortgage-backed (2)
|
225
|
|
|
9
|
|
|
—
|
|
|
234
|
|
|
1
|
%
|
||||
Preferred stock
|
448
|
|
|
15
|
|
|
18
|
|
|
445
|
|
|
1
|
%
|
||||
State & municipal
|
415
|
|
|
48
|
|
|
1
|
|
|
462
|
|
|
1
|
%
|
||||
Foreign governments
|
524
|
|
|
19
|
|
|
13
|
|
|
530
|
|
|
1
|
%
|
||||
Asset-backed securities
|
612
|
|
|
1
|
|
|
12
|
|
|
601
|
|
|
1
|
%
|
||||
Total
|
$
|
46,447
|
|
|
$
|
793
|
|
|
$
|
1,314
|
|
|
$
|
45,926
|
|
|
100
|
%
|
(1)
|
Investment data has been classified based on standard industry categorizations for domestic public holdings and similar classifications by industry for all other holdings.
|
(2)
|
Includes publicly traded agency pass-through securities and collateralized obligations.
|
(3)
|
Excludes amounts reclassified as Held-for-Sale.
|
NAIC Designation
|
|
Rating Agency Equivalent
|
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
||||||||
|
|
|
|
(in millions)
|
||||||||||||||
As of December 31, 2019 (1)
|
|
|
|
|
|
|
|
|
|
|
||||||||
1................................
|
|
Aaa, Aa, A
|
|
$
|
42,770
|
|
|
$
|
2,666
|
|
|
$
|
342
|
|
|
$
|
45,094
|
|
2................................
|
|
Baa
|
|
18,605
|
|
|
1,105
|
|
|
18
|
|
|
19,692
|
|
||||
|
|
Investment grade
|
|
61,375
|
|
|
3,771
|
|
|
360
|
|
|
64,786
|
|
||||
3................................
|
|
Ba
|
|
663
|
|
|
9
|
|
|
7
|
|
|
665
|
|
||||
4................................
|
|
B
|
|
567
|
|
|
4
|
|
|
10
|
|
|
561
|
|
||||
5................................
|
|
Caa
|
|
80
|
|
|
2
|
|
|
6
|
|
|
76
|
|
||||
6................................
|
|
Ca, C
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||
|
|
Below investment grade
|
|
1,312
|
|
|
15
|
|
|
23
|
|
|
1,304
|
|
||||
Total Fixed Maturities
|
|
$
|
62,687
|
|
|
$
|
3,786
|
|
|
$
|
383
|
|
|
$
|
66,090
|
|
||
|
|
|
|
|
|
|
|
|
|
|
||||||||
As of December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
||||||||
1................................
|
|
Aaa, Aa, A
|
|
$
|
30,805
|
|
|
$
|
587
|
|
|
$
|
835
|
|
|
$
|
30,557
|
|
2................................
|
|
Baa
|
|
14,541
|
|
|
202
|
|
|
437
|
|
|
14,306
|
|
||||
|
|
Investment grade
|
|
45,346
|
|
|
789
|
|
|
1,272
|
|
|
44,863
|
|
||||
3................................
|
|
Ba
|
|
589
|
|
|
1
|
|
|
18
|
|
|
572
|
|
||||
4................................
|
|
B
|
|
489
|
|
|
1
|
|
|
22
|
|
|
468
|
|
||||
5................................
|
|
Caa
|
|
18
|
|
|
1
|
|
|
1
|
|
|
18
|
|
||||
6................................
|
|
Ca, C
|
|
5
|
|
|
1
|
|
|
1
|
|
|
5
|
|
||||
|
|
Below investment grade
|
|
1,101
|
|
|
4
|
|
|
42
|
|
|
1,063
|
|
||||
Total Fixed Maturities
|
|
$
|
46,447
|
|
|
$
|
793
|
|
|
$
|
1,314
|
|
|
$
|
45,926
|
|
(1)
|
Excludes amounts reclassified as Held-for-Sale.
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||
|
Amortized
Cost
|
|
% of Total
|
|
Amortized
Cost
|
|
% of Total
|
||||||
|
(in millions)
|
||||||||||||
By Region:
|
|
|
|
|
|
|
|
||||||
U.S. Regions:
|
|
|
|
|
|
|
|
||||||
Pacific
|
$
|
3,468
|
|
|
28.6
|
%
|
|
$
|
3,288
|
|
|
27.7
|
%
|
Middle Atlantic
|
3,220
|
|
|
26.6
|
|
|
3,183
|
|
|
26.9
|
|
||
South Atlantic
|
1,269
|
|
|
10.5
|
|
|
1,207
|
|
|
10.2
|
|
||
East North Central
|
906
|
|
|
7.5
|
|
|
963
|
|
|
8.1
|
|
||
Mountain
|
1,012
|
|
|
8.4
|
|
|
1,014
|
|
|
8.6
|
|
||
West North Central
|
896
|
|
|
7.4
|
|
|
910
|
|
|
7.7
|
|
||
West South Central
|
631
|
|
|
5.2
|
|
|
578
|
|
|
4.9
|
|
||
New England
|
566
|
|
|
4.7
|
|
|
556
|
|
|
4.7
|
|
||
East South Central
|
139
|
|
|
1.1
|
|
|
143
|
|
|
1.2
|
|
||
Total Mortgage Loans
|
$
|
12,107
|
|
|
100.0
|
%
|
|
$
|
11,842
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
||||||
By Property Type:
|
|
|
|
|
|
|
|
||||||
Office
|
$
|
3,794
|
|
|
31.3
|
%
|
|
$
|
3,977
|
|
|
33.6
|
%
|
Multifamily
|
3,768
|
|
|
31.1
|
|
|
3,440
|
|
|
29.0
|
|
||
Agricultural loans
|
2,717
|
|
|
22.5
|
|
|
2,695
|
|
|
22.8
|
|
||
Retail
|
665
|
|
|
5.5
|
|
|
667
|
|
|
5.6
|
|
||
Industrial
|
344
|
|
|
2.8
|
|
|
333
|
|
|
2.8
|
|
||
Hospitality
|
477
|
|
|
4.0
|
|
|
384
|
|
|
3.3
|
|
||
Other
|
342
|
|
|
2.8
|
|
|
346
|
|
|
2.9
|
|
||
Total Mortgage Loans
|
$
|
12,107
|
|
|
100.0
|
%
|
|
$
|
11,842
|
|
|
100.0
|
%
|
Owner
|
Percentage Ownership
|
|
EQH and its subsidiaries
|
63.3
|
%
|
AB Holding
|
36.0
|
%
|
Unaffiliated holders
|
0.7
|
%
|
Total
|
100.0
|
%
|
|
As of December 31, 2019
|
||||||||||
|
Holdings
|
|
AB
|
|
Consolidated
|
||||||
|
(in millions)
|
||||||||||
Short-term debt:
|
|
|
|
|
|
||||||
Total short-term debt
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Long-term debt:
|
|
|
|
|
|
|
|
|
|||
Senior Notes (5.00%, due 2048)
|
1,480
|
|
|
—
|
|
|
1,480
|
|
|||
Senior Notes (4.35%, due 2028)
|
1,487
|
|
|
—
|
|
|
1,487
|
|
|||
Senior Notes (3.90%, due 2023)
|
795
|
|
|
—
|
|
|
795
|
|
|||
Delayed Draw Term Loan (3-month LIBOR + 1.125%, due 2021)
|
—
|
|
|
—
|
|
|
—
|
|
|||
Senior Debentures, 7.0%, due 2028
|
349
|
|
|
—
|
|
|
349
|
|
|||
Total long-term debt
|
4,111
|
|
|
—
|
|
|
4,111
|
|
|||
Total borrowings
|
$
|
4,111
|
|
|
$
|
—
|
|
|
$
|
4,111
|
|
|
As of December 31, 2018
|
||||||||||
|
Holdings
|
|
AB
|
|
Consolidated
|
||||||
|
(in millions)
|
||||||||||
Short-term debt:
|
|
|
|
|
|
||||||
AB commercial paper (with interest rate of 2.7%)
|
$
|
—
|
|
|
$
|
521
|
|
|
$
|
521
|
|
AB revolving credit facility (with interest rate of 3.4%)
|
—
|
|
|
25
|
|
|
25
|
|
|||
Total short-term debt
|
—
|
|
|
546
|
|
|
546
|
|
|||
Long-term debt:
|
|
|
|
|
|
|
|
|
|||
Senior Notes (5.00%, due 2048)
|
1,480
|
|
|
—
|
|
|
1,480
|
|
|||
Senior Notes (4.35%, due 2028)
|
1,486
|
|
|
—
|
|
|
1,486
|
|
|||
Senior Notes (3.90%, due 2023)
|
794
|
|
|
—
|
|
|
794
|
|
|||
Delayed Draw Term Loan (3-month LIBOR + 1.125%, due 2021)
|
300
|
|
|
—
|
|
|
300
|
|
|||
Senior Debentures, 7.0%, due 2028
|
349
|
|
|
—
|
|
|
349
|
|
|||
Total long-term debt
|
4,409
|
|
|
—
|
|
|
4,409
|
|
|||
Total borrowings
|
$
|
4,409
|
|
|
$
|
546
|
|
|
$
|
4,955
|
|
|
AM Best
|
|
S&P
|
|
Moody’s
|
Last review date
|
Dec '19
|
|
Nov '19
|
|
Aug '19
|
Financial Strength Ratings:
|
|
|
|
|
|
Equitable Life
|
A
|
|
A+
|
|
A2
|
Equitable America
|
A
|
|
A+
|
|
A2
|
|
|
|
|
|
|
Credit Ratings:
|
|
|
|
|
|
Holdings
|
bbb+
|
|
BBB+
|
|
Baa2
|
|
|
|
|
|
|
Last Review Date
|
|
|
Oct '19
|
|
Nov '19
|
AB
|
—
|
|
A
|
|
A2
|
|
Estimated Payments Due by Year
|
||||||||||||||||||
|
Total
|
|
2020
|
|
2021-2022
|
|
2023-2024
|
|
2025 and thereafter
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Contractual obligations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Insurance liabilities (1)
|
$
|
104,812
|
|
|
$
|
1,502
|
|
|
$
|
4,697
|
|
|
$
|
6,694
|
|
|
$
|
91,919
|
|
FHLBNY Funding Agreements
|
6,900
|
|
|
4,608
|
|
|
1,413
|
|
|
233
|
|
|
646
|
|
|||||
Interest on FHLBNY Funding Agreements
|
195
|
|
|
60
|
|
|
70
|
|
|
42
|
|
|
23
|
|
|||||
Operating leases, net of sublease commitments
|
1,364
|
|
|
162
|
|
|
299
|
|
|
213
|
|
|
690
|
|
|||||
Long-term debt
|
4,150
|
|
|
—
|
|
|
—
|
|
|
800
|
|
|
3,350
|
|
|||||
Interest on long-term debt
|
3,010
|
|
|
196
|
|
|
392
|
|
|
345
|
|
|
2,077
|
|
|||||
Interest on P-Caps
|
441
|
|
|
24
|
|
|
47
|
|
|
47
|
|
|
323
|
|
|||||
Employee benefits
|
3,991
|
|
|
223
|
|
|
493
|
|
|
422
|
|
|
2,853
|
|
|||||
AB Funding Commitments
|
10
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total Contractual Obligations
|
$
|
124,873
|
|
|
$
|
6,785
|
|
|
$
|
7,411
|
|
|
$
|
8,796
|
|
|
$
|
101,881
|
|
(1)
|
Policyholders’ liabilities represent estimated cash flows out of the General Account related to the payment of death and disability claims, policy surrenders and withdrawals, annuity payments, minimum guarantees on Separate Account funded contracts, matured endowments, benefits under accident and health contracts, policyholder dividends and future renewal premium-based and fund-based commissions offset by contractual future premiums and deposits on in-force contracts. These estimated cash flows are based on mortality, morbidity and lapse assumptions comparable with the Company’s experience and assume market growth and interest crediting consistent with actuarial assumptions used in amortizing DAC. These amounts are undiscounted and, therefore, exceed the policyholders’ account balances and future policy benefits and other policyholder liabilities included in the consolidated balance sheet included elsewhere in this Annual Report on Form 10-K. They do not reflect projected recoveries from reinsurance agreements. Due to the use of assumptions, actual cash flows will differ from these estimates, see “— Summary of Critical Accounting Estimates — Liability for Future Policy Benefits.” Separate Accounts liabilities have been excluded as they are legally insulated from General Account obligations and will be funded by cash flows from Separate Accounts assets.
|
•
|
At year-end 2019, AB had a $255 million accrual for compensation and benefits, of which $168 million is expected to be paid in 2020, $54 million in 2021 and 2022, $15 million in 2023-2024 and the rest thereafter. Further, AB expects to make contributions to its qualified profit-sharing plan of $15 million in each of the next four years.
|
•
|
In addition, the Company has obligations under contingent commitments at December 31, 2019, including: the AB Credit Facility; the Company’s $1.9 billion undrawn letters of credit; the Company’s $1.2 billion and $260 million commitments under equity financing arrangements to certain limited partnership and existing mortgage loan agreements, respectively. Information on these contingent commitments can be found in Notes 12, 17 and 18 to the Notes to the Consolidated Financial Statements.
|
•
|
During 2010, as general partner of AllianceBernstein U.S. Real Estate L.P. (“Real Estate Fund”), AB committed to invest $25 million in the Real Estate Fund. As of December 31, 2019, we had funded $22 million of this commitment. During 2014, as general partner of AllianceBernstein U.S. Real Estate II L.P. (“Real Estate Fund II”), AB committed to invest $28 million, as amended in 2015, in the Real Estate Fund II. As of December 31, 2019, AB had funded $20 million of this commitment.
|
|
Years Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Highly Liquid Assets, beginning of period
|
$
|
743
|
|
|
$
|
44
|
|
Dividends from subsidiaries
|
1,341
|
|
|
1,838
|
|
||
Repayment of surplus note including interest
|
576
|
|
|
—
|
|
||
Issuance of loans to affiliates
|
—
|
|
|
(572
|
)
|
||
Capital contribution from parent company
|
—
|
|
|
8
|
|
||
Capital contributions to subsidiaries
|
(86
|
)
|
|
(3,679
|
)
|
||
Purchase of AllianceBernstein Units
|
—
|
|
|
(1,340
|
)
|
||
Increase in cash and cash equivalents from merger of AXA Financial, Inc.
|
—
|
|
|
381
|
|
||
Total Business Capital Activity
|
1,831
|
|
|
(3,364
|
)
|
||
Purchase of treasury shares
|
(1,200
|
)
|
|
(648
|
)
|
||
Retirement of treasury shares
|
(150
|
)
|
|
—
|
|
||
Shareholder dividends paid
|
(285
|
)
|
|
(157
|
)
|
||
Total Share Repurchases, Dividends and Acquisition Activity
|
(1,635
|
)
|
|
(805
|
)
|
||
Issuance of preferred stock
|
775
|
|
|
—
|
|
||
Total Preferred Stock Activity
|
775
|
|
|
—
|
|
||
Issuance of long-term debt
|
—
|
|
|
4,057
|
|
||
Repayment of long-term debt
|
(300
|
)
|
|
—
|
|
||
Total External Debt Activity
|
(300
|
)
|
|
4,057
|
|
||
Repayments of loans from affiliates
|
(300
|
)
|
|
(200
|
)
|
||
Proceeds from loans from affiliates
|
900
|
|
|
800
|
|
||
Repayment of loans to affiliates
|
—
|
|
|
1,045
|
|
||
Issuance of loans to affiliates
|
(560
|
)
|
|
—
|
|
||
Total Affiliated Debt Activity
|
40
|
|
|
1,645
|
|
||
Interest paid on external debt and P-Caps
|
(215
|
)
|
|
(104
|
)
|
||
Others, net
|
350
|
|
|
(730
|
)
|
||
Total Other Activity
|
135
|
|
|
(834
|
)
|
||
Net increase (decrease) in highly liquid assets
|
846
|
|
|
699
|
|
||
Highly Liquid Assets, end of period
|
$
|
1,589
|
|
|
$
|
743
|
|
•
|
liabilities for future policy benefits;
|
•
|
accounting for reinsurance;
|
•
|
capitalization and amortization of DAC and policyholder bonus interest credits;
|
•
|
estimated fair values of investments in the absence of quoted market values and investment impairments;
|
•
|
estimated fair values of freestanding derivatives and the recognition and estimated fair value of embedded derivatives requiring bifurcation;
|
•
|
goodwill and related impairment;
|
•
|
measurement of income taxes and the valuation of deferred tax assets; and
|
•
|
liabilities for litigation and regulatory matters.
|
•
|
Universal life (“UL”) and investment-type contract policyholder account balances are equal to the policy AV. The policy AV represent an accumulation of gross premium payments plus credited interest less expense and mortality charges and withdrawals.
|
•
|
Participating traditional life insurance future policy benefit liabilities are calculated using a net level premium method on the basis of actuarial assumptions equal to guaranteed mortality and dividend fund interest rates.
|
•
|
Non-participating traditional life insurance future policy benefit liabilities are estimated using a net level premium method on the basis of actuarial assumptions as to mortality, persistency and interest.
|
|
Increase/(Decrease) in
GMDB/GMIB Reserves
|
||
|
(in millions)
|
||
1% decrease in future rate of return
|
$
|
1,343
|
|
1% increase in future rate of return
|
$
|
(1,478
|
)
|
|
Increase/(Decrease)
in DAC
|
||
|
(in millions)
|
||
Decrease in future mortality by 1%
|
$
|
35
|
|
Increase in future mortality by 1%
|
$
|
(35
|
)
|
|
Increase/(Decrease)
in DAC
|
||
|
(in millions)
|
||
Decrease in future rate of return by 1%
|
$
|
(166
|
)
|
Increase in future rate of return by 1%
|
$
|
195
|
|
•
|
Loan-to-value ratio—Derived from current loan balance divided by the fair market value of the property. An allowance for credit loss is typically recommended when the loan-to-value ratio is in excess of 100%. In the case where the loan-to-value is in excess of 100%, the allowance for credit loss is derived by taking the difference between the fair market value (less cost of sale) and the current loan balance.
|
•
|
Debt service coverage ratio—Derived from actual Operating Earnings divided by annual debt service. If the ratio is below 1.0x, then the income from the property does not support the debt.
|
•
|
Occupancy—Criteria vary by property type but low or below market occupancy is an indicator of sub-par property performance.
|
•
|
Lease expirations—The percentage of leases expiring in the upcoming 12 to 36 months are monitored as a decline in rent and/or occupancy may negatively impact the debt service coverage ratio. In the case of single-tenant properties or properties with large tenant exposure, the lease expiration is a material risk factor.
|
•
|
Maturity—Mortgage loans that are not fully amortizing and have upcoming maturities within the next 12 to 24 months are monitored in conjunction with the capital markets to determine the borrower’s ability to refinance the debt and/or pay off the balloon balance.
|
•
|
Borrower/tenant related issues—Financial concerns, potential bankruptcy, or words or actions that indicate imminent default or abandonment of property.
|
•
|
Payment status - current vs. delinquent—A history of delinquent payments may be a cause for concern.
|
•
|
Property condition—Significant deferred maintenance observed during the lenders annual site inspections.
|
•
|
Other—Any other factors such as current economic conditions may call into question the performance of the loan.
|
|
Future policyholders’ benefits and other policyholders’ liabilities
|
||
|
(in billions)
|
||
100% increase in Holdings’ credit spread
|
$
|
6.0
|
|
As reported
|
$
|
8.4
|
|
50% decrease in Holdings’ credit spread
|
$
|
9.1
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
Fair Value
|
|
Impact of +1% Change
|
|
Impact of -1% Change
|
|
Fair Value
|
|
Impact of +1% Change
|
|
Impact of -1% Change
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Fixed Income Investments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed rate
|
$
|
63,908
|
|
|
$
|
(6,005
|
)
|
|
$
|
7,267
|
|
|
$
|
44,379
|
|
|
$
|
(3,874
|
)
|
|
$
|
4,595
|
|
Floating rate
|
$
|
2,182
|
|
|
$
|
(45
|
)
|
|
$
|
49
|
|
|
$
|
1,547
|
|
|
$
|
(41
|
)
|
|
$
|
42
|
|
Trading securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed rate
|
$
|
5,765
|
|
|
$
|
(144
|
)
|
|
$
|
148
|
|
|
$
|
14,219
|
|
|
$
|
(368
|
)
|
|
$
|
355
|
|
Floating rate
|
$
|
408
|
|
|
$
|
(1
|
)
|
|
$
|
1
|
|
|
$
|
599
|
|
|
$
|
(1
|
)
|
|
$
|
1
|
|
Mortgage loans
|
$
|
12,334
|
|
|
$
|
(470
|
)
|
|
$
|
408
|
|
|
$
|
11,494
|
|
|
$
|
(658
|
)
|
|
$
|
572
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
Fair Value
|
|
Impact of+10% Equity Price Change
|
|
Impact of -10% Equity Price Change
|
|
Fair Value
|
|
Impact of+10% Equity Price Change
|
|
Impact of -10% Equity Price Change
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Equity Investments
|
$
|
13
|
|
|
$
|
1
|
|
|
$
|
(1
|
)
|
|
$
|
12
|
|
|
$
|
1
|
|
|
$
|
(1
|
)
|
|
|
|
|
|
Interest Rate Sensitivity
|
||||||||||||
|
Notional
Amount
|
|
Weighted Average Term (Years)
|
|
Impact of -1% Change
|
|
Fair
Value
|
|
Impact of +1% Change
|
||||||||
|
(in millions, except for Weighted Average Term)
|
||||||||||||||||
December 31, 2019
|
|
|
|
|
|
|
|
|
|
||||||||
Swaps
|
$
|
23,700
|
|
|
5
|
|
$
|
3,406
|
|
|
$
|
(57
|
)
|
|
$
|
(2,838
|
)
|
Futures
|
20,901
|
|
|
|
|
1,122
|
|
|
—
|
|
|
(900
|
)
|
||||
Swaption
|
3,201
|
|
|
|
|
560
|
|
|
16
|
|
|
(3
|
)
|
||||
Total
|
$
|
47,802
|
|
|
|
|
$
|
5,088
|
|
|
$
|
(41
|
)
|
|
$
|
(3,741
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2018
|
|
|
|
|
|
|
|
|
|
||||||||
Swaps
|
$
|
27,003
|
|
|
5
|
|
$
|
3,262
|
|
|
$
|
439
|
|
|
$
|
(1,857
|
)
|
Futures
|
11,792
|
|
|
|
|
590
|
|
|
—
|
|
|
(427
|
)
|
||||
Total
|
$
|
38,795
|
|
|
|
|
$
|
3,852
|
|
|
$
|
439
|
|
|
$
|
(2,284
|
)
|
|
|
|
|
|
Equity Sensitivity
|
||||||||
|
Notional
Amount |
|
Weighted Average Term (Years)
|
|
Fair Value
|
|
Balance after -10% Equity Price Shift
|
||||||
|
(in millions, except for Weighted Average Term)
|
||||||||||||
December 31, 2019
|
|
|
|
|
|
|
|
||||||
Futures
|
$
|
4,086
|
|
|
0
|
|
$
|
—
|
|
|
$
|
(231
|
)
|
Swaps
|
17,064
|
|
|
0
|
|
(270
|
)
|
|
(2,004
|
)
|
|||
Options
|
47,861
|
|
|
2
|
|
3,346
|
|
|
4,102
|
|
|||
Total
|
$
|
69,011
|
|
|
|
|
$
|
3,076
|
|
|
$
|
1,867
|
|
|
|
|
|
|
|
|
|
||||||
December 31, 2018
|
|
|
|
|
|
|
|
||||||
Futures
|
$
|
10,995
|
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Swaps
|
7,697
|
|
|
1
|
|
(29
|
)
|
|
746
|
|
|||
Options
|
21,821
|
|
|
2
|
|
968
|
|
|
324
|
|
|||
Total
|
$
|
40,513
|
|
|
|
|
$
|
939
|
|
|
$
|
1,070
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
Fair Value
|
|
Balance After -1% Change
|
|
Balance After+1% Change
|
|
Fair Value
|
|
Balance After -1% Change
|
|
Balance After +1% Change
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Fixed Income Investments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trading
|
$
|
36
|
|
|
$
|
39
|
|
|
$
|
34
|
|
|
$
|
435
|
|
|
$
|
467
|
|
|
$
|
406
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
Fair Value
|
|
Balance After +10% Equity Price Change
|
|
Balance After -10% Equity Price Change
|
|
Fair Value
|
|
Balance After +10% Equity Price Change
|
|
Balance After -10% Equity Price Change
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Equity Investments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trading
|
$
|
151
|
|
|
$
|
166
|
|
|
$
|
137
|
|
|
$
|
178
|
|
|
$
|
196
|
|
|
$
|
160
|
|
Other investments
|
$
|
80
|
|
|
$
|
88
|
|
|
$
|
72
|
|
|
$
|
101
|
|
|
$
|
111
|
|
|
$
|
91
|
|
Audited Consolidated Financial Statements
|
|
|
|
Audited Consolidated Financial Statement Schedules
|
|
|
|
|
2019
|
|
2018
|
||||
|
(in millions, except share amounts)
|
||||||
ASSETS
|
|
|
|
||||
Investments:
|
|
|
|
||||
Fixed maturities available-for-sale, at fair value (amortized cost of $62,937 and $46,801)
|
$
|
66,343
|
|
|
$
|
46,279
|
|
Mortgage loans on real estate (net of valuation allowance of $0 and $7)
|
12,107
|
|
|
11,835
|
|
||
Real estate held for production of income (1)
|
27
|
|
|
52
|
|
||
Policy loans
|
3,735
|
|
|
3,779
|
|
||
Other equity investments (1)
|
1,344
|
|
|
1,334
|
|
||
Trading securities, at fair value
|
7,031
|
|
|
16,017
|
|
||
Other invested assets (1)
|
2,753
|
|
|
2,037
|
|
||
Total investments
|
93,340
|
|
|
81,333
|
|
||
Cash and cash equivalents (1)
|
4,405
|
|
|
4,469
|
|
||
Cash and securities segregated, at fair value
|
1,095
|
|
|
1,170
|
|
||
Broker-dealer related receivables
|
1,987
|
|
|
2,209
|
|
||
Deferred policy acquisition costs
|
5,890
|
|
|
6,745
|
|
||
Goodwill and other intangible assets, net
|
4,751
|
|
|
4,780
|
|
||
Amounts due from reinsurers
|
4,592
|
|
|
4,895
|
|
||
GMIB reinsurance contract asset, at fair value
|
2,139
|
|
|
1,732
|
|
||
Other assets (1)
|
3,799
|
|
|
3,127
|
|
||
Assets held-for-sale
|
962
|
|
|
—
|
|
||
Separate Accounts assets
|
126,910
|
|
|
110,337
|
|
||
Total Assets
|
$
|
249,870
|
|
|
$
|
220,797
|
|
LIABILITIES
|
|
|
|
||||
Policyholders’ account balances
|
$
|
58,879
|
|
|
$
|
49,923
|
|
Future policy benefits and other policyholders' liabilities
|
34,587
|
|
|
30,998
|
|
||
Broker-dealer related payables
|
722
|
|
|
431
|
|
||
Securities sold under agreements to repurchase
|
—
|
|
|
573
|
|
||
Customer related payables
|
2,523
|
|
|
3,095
|
|
||
Amounts due to reinsurers
|
1,404
|
|
|
1,438
|
|
||
Short-term and long-term debt
|
4,111
|
|
|
4,955
|
|
||
Current and deferred income taxes
|
549
|
|
|
68
|
|
||
Other liabilities (1)
|
3,970
|
|
|
3,360
|
|
||
Liabilities held-for-sale
|
724
|
|
|
—
|
|
||
Separate Accounts liabilities
|
126,910
|
|
|
110,337
|
|
||
Total Liabilities
|
$
|
234,379
|
|
|
$
|
205,178
|
|
Redeemable noncontrolling interest (1) (2)
|
$
|
365
|
|
|
$
|
187
|
|
Commitments and contingent liabilities (Note 17)
|
|
|
|
|
|
||
EQUITY
|
|
|
|
||||
Equity attributable to Holdings:
|
|
|
|
||||
Preferred stock and additional paid-in capital, par value $1.00 per share; $25,000 liquidation preference at December 31, 2019
|
$
|
775
|
|
|
$
|
—
|
|
Common stock, $0.01 par value, 2,000,000,000 shares authorized; 552,896,328 and 561,000,000 shares issued, respectively; 463,711,392 and 528,861,758 shares outstanding, respectively
|
5
|
|
|
5
|
|
||
Additional paid-in capital
|
1,920
|
|
|
1,908
|
|
||
Treasury stock, at cost, 89,184,936 and 32,138,242 shares, respectively
|
(1,832
|
)
|
|
(640
|
)
|
||
Retained earnings
|
11,827
|
|
|
13,989
|
|
||
Accumulated other comprehensive income (loss)
|
840
|
|
|
(1,396
|
)
|
||
Total equity attributable to Holdings
|
13,535
|
|
|
13,866
|
|
||
Noncontrolling interest
|
1,591
|
|
|
1,566
|
|
||
Total Equity
|
15,126
|
|
|
15,432
|
|
||
Total Liabilities, Redeemable Noncontrolling Interest and Equity
|
$
|
249,870
|
|
|
$
|
220,797
|
|
(1)
|
See Note 2 for details of balances with variable interest entities.
|
(2)
|
See Note 23 for details of Redeemable noncontrolling interest.
|
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions, except per share data)
|
||||||||||
REVENUES
|
|
|
|
|
|
||||||
Policy charges and fee income
|
$
|
3,738
|
|
|
$
|
3,824
|
|
|
$
|
3,693
|
|
Premiums
|
1,147
|
|
|
1,094
|
|
|
1,124
|
|
|||
Net derivative gains (losses)
|
(4,000
|
)
|
|
(231
|
)
|
|
214
|
|
|||
Net investment income (loss)
|
3,699
|
|
|
2,693
|
|
|
3,082
|
|
|||
Investment gains (losses), net:
|
|
|
|
|
|
||||||
Total other-than-temporary impairment losses
|
—
|
|
|
(42
|
)
|
|
(15
|
)
|
|||
Other investment gains (losses), net
|
73
|
|
|
(44
|
)
|
|
(176
|
)
|
|||
Total investment gains (losses), net
|
73
|
|
|
(86
|
)
|
|
(191
|
)
|
|||
Investment management and service fees
|
4,380
|
|
|
4,268
|
|
|
4,093
|
|
|||
Other income
|
554
|
|
|
516
|
|
|
445
|
|
|||
Total revenues
|
9,591
|
|
|
12,078
|
|
|
12,460
|
|
|||
|
|
|
|
|
|
||||||
BENEFITS AND OTHER DEDUCTIONS
|
|
|
|
|
|
||||||
Policyholders’ benefits
|
4,370
|
|
|
2,915
|
|
|
4,366
|
|
|||
Interest credited to policyholders’ account balances
|
1,241
|
|
|
1,090
|
|
|
995
|
|
|||
Compensation and benefits
|
2,081
|
|
|
2,079
|
|
|
1,980
|
|
|||
Commissions and distribution-related payments
|
1,242
|
|
|
1,160
|
|
|
1,081
|
|
|||
Interest expense
|
221
|
|
|
231
|
|
|
160
|
|
|||
Amortization of deferred policy acquisition costs
|
579
|
|
|
333
|
|
|
503
|
|
|||
Other operating costs and expenses
|
1,892
|
|
|
1,809
|
|
|
2,069
|
|
|||
Total benefits and other deductions
|
11,626
|
|
|
9,617
|
|
|
11,154
|
|
|||
Income (loss) from continuing operations, before income taxes
|
(2,035
|
)
|
|
2,461
|
|
|
1,306
|
|
|||
Income tax (expense) benefit
|
599
|
|
|
(307
|
)
|
|
(49
|
)
|
|||
Net income (loss)
|
(1,436
|
)
|
|
2,154
|
|
|
1,257
|
|
|||
Less: Net income (loss) attributable to the noncontrolling interest
|
297
|
|
|
334
|
|
|
423
|
|
|||
Net income (loss) attributable to Holdings
|
$
|
(1,733
|
)
|
|
$
|
1,820
|
|
|
$
|
834
|
|
|
|
|
|
|
|
||||||
EARNINGS PER SHARE
|
|
|
|
|
|
||||||
Earnings per share - common stock:
|
|
|
|
|
|
||||||
Basic
|
$
|
(3.51
|
)
|
|
$
|
3.27
|
|
|
$
|
1.49
|
|
Diluted
|
$
|
(3.51
|
)
|
|
$
|
3.27
|
|
|
$
|
1.49
|
|
Weighted average common shares outstanding (in millions):
|
|
|
|
|
|
||||||
Basic
|
493.6
|
|
|
556.4
|
|
|
561.0
|
|
|||
Diluted
|
493.6
|
|
|
556.5
|
|
|
561.0
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
COMPREHENSIVE INCOME (LOSS)
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(1,436
|
)
|
|
$
|
2,154
|
|
|
$
|
1,257
|
|
Other comprehensive income (loss) net of income taxes:
|
|
|
|
|
|
||||||
Change in unrealized gains (losses), net of reclassification adjustment (1)
|
2,242
|
|
|
(1,334
|
)
|
|
693
|
|
|||
Changes in defined benefit plan related items not yet recognized in periodic benefit cost, net of reclassification adjustment
|
(15
|
)
|
|
189
|
|
|
100
|
|
|||
Foreign currency translation adjustment (1)
|
5
|
|
|
(32
|
)
|
|
39
|
|
|||
Total other comprehensive income (loss), net of income taxes
|
2,232
|
|
|
(1,177
|
)
|
|
832
|
|
|||
Comprehensive income (loss)
|
796
|
|
|
977
|
|
|
2,089
|
|
|||
Less: Comprehensive income (loss) attributable to the noncontrolling interest
|
293
|
|
|
349
|
|
|
442
|
|
|||
Comprehensive income (loss) attributable to Holdings
|
$
|
503
|
|
|
$
|
628
|
|
|
$
|
1,647
|
|
(1)
|
A reclassification of $5 million and $3 million has been made to the previously reported amounts for the years ended December 31, 2018 and 2017, respectively to conform to the current period’s presentation.
|
|
|
|
Years Ended December 31,
|
||||||||||||||||||||||||||||||||
|
|
|
Equity Attributable to Holdings
|
|
|
|
|
||||||||||||||||||||||||||||
|
Preferred Stock and Additional Paid-In Capital
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Treasury Stock
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total Holdings Equity
|
|
Non-controlling Interest
|
|
Total Equity
|
||||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||||||||||
January 1, 2019
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
1,908
|
|
|
$
|
(640
|
)
|
|
$
|
13,989
|
|
|
$
|
(1,396
|
)
|
|
$
|
13,866
|
|
|
$
|
1,566
|
|
|
$
|
15,432
|
|
Stock compensation
|
—
|
|
|
—
|
|
|
152
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
161
|
|
|
77
|
|
|
238
|
|
|||||||||
Purchase of treasury stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,343
|
)
|
|
(2
|
)
|
|
—
|
|
|
(1,345
|
)
|
|
—
|
|
|
(1,345
|
)
|
|||||||||
Retirement of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
142
|
|
|
(142
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Repurchase of AB Holding units
|
—
|
|
|
—
|
|
|
(112
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(112
|
)
|
|
(61
|
)
|
|
(173
|
)
|
|||||||||
Dividends paid to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(256
|
)
|
|
(256
|
)
|
|||||||||
Dividends on common stock (cash dividends declared per common share of $0.58 in 2019)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(285
|
)
|
|
—
|
|
|
(285
|
)
|
|
—
|
|
|
(285
|
)
|
|||||||||
Issuance of preferred stock
|
775
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
775
|
|
|
—
|
|
|
775
|
|
|||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,733
|
)
|
|
—
|
|
|
(1,733
|
)
|
|
263
|
|
|
(1,470
|
)
|
|||||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,236
|
|
|
2,236
|
|
|
(4
|
)
|
|
2,232
|
|
|||||||||
Other
|
—
|
|
|
—
|
|
|
(28
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(28
|
)
|
|
6
|
|
|
(22
|
)
|
|||||||||
December 31, 2019
|
$
|
775
|
|
|
$
|
5
|
|
|
$
|
1,920
|
|
|
$
|
(1,832
|
)
|
|
$
|
11,827
|
|
|
$
|
840
|
|
|
$
|
13,535
|
|
|
$
|
1,591
|
|
|
$
|
15,126
|
|
January 1, 2018
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
1,299
|
|
|
$
|
—
|
|
|
$
|
12,225
|
|
|
$
|
(108
|
)
|
|
$
|
13,421
|
|
|
$
|
3,097
|
|
|
$
|
16,518
|
|
Purchase of treasury stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(648
|
)
|
|
—
|
|
|
—
|
|
|
(648
|
)
|
|
—
|
|
|
(648
|
)
|
|||||||||
Reissuance of treasury stock
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Repurchase of AB Holding units
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(95
|
)
|
|
(95
|
)
|
|||||||||
Dividends paid to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(346
|
)
|
|
(346
|
)
|
|||||||||
Dividends on common stock (cash dividends declared per common share of $0.26 in 2018)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(157
|
)
|
|
—
|
|
|
(157
|
)
|
|
—
|
|
|
(157
|
)
|
|||||||||
Capital contribution from parent
|
—
|
|
|
—
|
|
|
695
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
695
|
|
|
—
|
|
|
695
|
|
|||||||||
Purchase of AB Units by Holdings
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,525
|
)
|
|
(1,525
|
)
|
|||||||||
Purchase of AllianceBernstein Units from noncontrolling interest
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
17
|
|
|||||||||
Cumulative effect of adoption of revenue recognition standard ASC 606
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
13
|
|
|
19
|
|
|
32
|
|
|||||||||
Cumulative effect of adoption of ASU 2018-02, Reclassification of Certain Tax Effects
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
89
|
|
|
(89
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Cumulative effect of adoption of ASU 2016-01, Financial Instruments
|
—
|
|
|
|
|
|
|
|
|
|
7
|
|
|
(7
|
)
|
|
—
|
|
|
|
|
—
|
|
||||||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,820
|
|
|
—
|
|
|
1,820
|
|
|
316
|
|
|
2,136
|
|
|||||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,192
|
)
|
|
(1,192
|
)
|
|
15
|
|
|
(1,177
|
)
|
|||||||||
Other
|
—
|
|
|
—
|
|
|
(103
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(103
|
)
|
|
85
|
|
|
(18
|
)
|
|||||||||
December 31, 2018
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
1,908
|
|
|
$
|
(640
|
)
|
|
$
|
13,989
|
|
|
$
|
(1,396
|
)
|
|
$
|
13,866
|
|
|
$
|
1,566
|
|
|
$
|
15,432
|
|
January 1, 2017
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
932
|
|
|
$
|
—
|
|
|
$
|
11,391
|
|
|
$
|
(921
|
)
|
|
$
|
11,407
|
|
|
$
|
3,142
|
|
|
$
|
14,549
|
|
Repurchase of AB Holding units
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(121
|
)
|
|
(121
|
)
|
|||||||||
Dividends paid to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(348
|
)
|
|
(348
|
)
|
|||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
834
|
|
|
—
|
|
|
834
|
|
|
370
|
|
|
1,204
|
|
|||||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
813
|
|
|
813
|
|
|
19
|
|
|
832
|
|
|||||||||
Other
|
—
|
|
|
—
|
|
|
367
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
367
|
|
|
35
|
|
|
402
|
|
|||||||||
December 31, 2017
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
1,299
|
|
|
$
|
—
|
|
|
$
|
12,225
|
|
|
$
|
(108
|
)
|
|
$
|
13,421
|
|
|
$
|
3,097
|
|
|
$
|
16,518
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(1,436
|
)
|
|
$
|
2,154
|
|
|
$
|
1,257
|
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
|
|
|
|
|
|
||||||
Interest credited to policyholders’ account balances
|
1,241
|
|
|
1,090
|
|
|
995
|
|
|||
Policy charges and fee income
|
(3,738
|
)
|
|
(3,824
|
)
|
|
(3,693
|
)
|
|||
Net derivative (gains) losses
|
4,000
|
|
|
231
|
|
|
(214
|
)
|
|||
Investment (gains) losses, net
|
(206
|
)
|
|
86
|
|
|
191
|
|
|||
Loss on businesses held for sale
|
133
|
|
|
—
|
|
|
—
|
|
|||
Realized and unrealized (gains) losses on trading securities
|
(502
|
)
|
|
237
|
|
|
(266
|
)
|
|||
Non-cash long term incentive compensation expense
|
278
|
|
|
228
|
|
|
247
|
|
|||
Non-cash pension plan restructuring
|
—
|
|
|
109
|
|
|
—
|
|
|||
Amortization and depreciation
|
657
|
|
|
257
|
|
|
399
|
|
|||
Change in goodwill
|
—
|
|
|
—
|
|
|
369
|
|
|||
Equity (income) loss from limited partnerships
|
(92
|
)
|
|
(119
|
)
|
|
(155
|
)
|
|||
Changes in:
|
|
|
|
|
|
||||||
Net broker-dealer and customer related receivables/payables
|
(403
|
)
|
|
838
|
|
|
(278
|
)
|
|||
Reinsurance recoverable
|
(146
|
)
|
|
(191
|
)
|
|
124
|
|
|||
Segregated cash and securities, net
|
75
|
|
|
(345
|
)
|
|
130
|
|
|||
Capitalization of deferred policy acquisition costs
|
(754
|
)
|
|
(702
|
)
|
|
(687
|
)
|
|||
Future policy benefits
|
947
|
|
|
(399
|
)
|
|
1,097
|
|
|||
Current and deferred income taxes
|
(108
|
)
|
|
633
|
|
|
(10
|
)
|
|||
Other, net
|
(162
|
)
|
|
(222
|
)
|
|
251
|
|
|||
Net cash provided by (used in) operating activities
|
$
|
(216
|
)
|
|
$
|
61
|
|
|
$
|
(243
|
)
|
|
|
|
|
|
|
||||||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Proceeds from the sale/maturity/prepayment of:
|
|
|
|
|
|
||||||
Fixed maturities, available-for-sale
|
$
|
13,327
|
|
|
$
|
10,631
|
|
|
$
|
11,339
|
|
Mortgage loans on real estate
|
952
|
|
|
768
|
|
|
934
|
|
|||
Trading account securities
|
10,717
|
|
|
9,340
|
|
|
11,231
|
|
|||
Real estate joint ventures
|
5
|
|
|
139
|
|
|
—
|
|
|||
Short term investments
|
2,643
|
|
|
6,267
|
|
|
4,556
|
|
|||
Other
|
306
|
|
|
330
|
|
|
228
|
|
|||
Payment for the purchase/origination of:
|
|
|
|
|
|
||||||
Fixed maturities, available-for-sale
|
(29,610
|
)
|
|
(12,794
|
)
|
|
(15,166
|
)
|
|||
Mortgage loans on real estate
|
(1,240
|
)
|
|
(1,642
|
)
|
|
(2,108
|
)
|
|||
Trading account securities
|
(1,123
|
)
|
|
(11,401
|
)
|
|
(13,328
|
)
|
|||
Short term investments
|
(2,776
|
)
|
|
(5,058
|
)
|
|
(4,897
|
)
|
|||
Other
|
(430
|
)
|
|
(233
|
)
|
|
(296
|
)
|
|||
Purchase of business, net of cash acquired
|
—
|
|
|
—
|
|
|
(130
|
)
|
|||
Cash settlements related to derivative instruments
|
(954
|
)
|
|
583
|
|
|
(2,166
|
)
|
|||
Repayments of loans to affiliates
|
—
|
|
|
1,230
|
|
|
15
|
|
|||
Investment in capitalized software, leasehold improvements and EDP equipment
|
(93
|
)
|
|
(123
|
)
|
|
(102
|
)
|
|||
Other, net
|
(220
|
)
|
|
(86
|
)
|
|
201
|
|
|||
Net cash provided by (used in) investing activities
|
$
|
(8,496
|
)
|
|
$
|
(2,049
|
)
|
|
$
|
(9,689
|
)
|
|
|
|
|
|
|
||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Policyholders’ account balances:
|
|
|
|
|
|
||||||
Deposits
|
$
|
12,843
|
|
|
$
|
9,994
|
|
|
$
|
9,916
|
|
Withdrawals
|
(4,619
|
)
|
|
(4,600
|
)
|
|
(4,010
|
)
|
|||
Transfers (to) from Separate Accounts
|
1,769
|
|
|
1,724
|
|
|
1,486
|
|
|||
Proceeds from loans from affiliates
|
—
|
|
|
—
|
|
|
731
|
|
|||
Change in short-term financings
|
(546
|
)
|
|
(1,310
|
)
|
|
600
|
|
|||
Change in collateralized pledged assets
|
(71
|
)
|
|
31
|
|
|
1,044
|
|
|||
Change in collateralized pledged liabilities
|
1,361
|
|
|
(576
|
)
|
|
1,246
|
|
|||
(Decrease) increase in overdrafts payable
|
(60
|
)
|
|
3
|
|
|
63
|
|
|||
Repayment of loans from affiliates
|
—
|
|
|
(3,000
|
)
|
|
(56
|
)
|
|||
Issuance of long-term debt
|
—
|
|
|
4,057
|
|
|
—
|
|
|||
Repayment of long-term debt
|
(300
|
)
|
|
—
|
|
|
—
|
|
|||
Shareholder dividends paid
|
(285
|
)
|
|
(157
|
)
|
|
—
|
|
|||
Issuance of preferred stock
|
775
|
|
|
—
|
|
|
—
|
|
|||
Purchase of AllianceBernstein Units
|
—
|
|
|
(1,340
|
)
|
|
—
|
|
|||
Purchases of AB Holding Units to fund long-term incentive compensation plan awards
|
(172
|
)
|
|
(267
|
)
|
|
(220
|
)
|
|||
Purchase of treasury shares
|
(1,350
|
)
|
|
(648
|
)
|
|
—
|
|
|||
Purchases (redemptions) of noncontrolling interests of consolidated
company-sponsored investment funds |
169
|
|
|
(472
|
)
|
|
120
|
|
|||
Distribution to noncontrolling interest of consolidated subsidiaries
|
(256
|
)
|
|
(346
|
)
|
|
(348
|
)
|
|||
Increase (decrease) in securities sold under agreement to repurchase
|
(573
|
)
|
|
(1,314
|
)
|
|
(1,706
|
)
|
|||
Purchase of shares in consolidated subsidiaries
|
—
|
|
|
—
|
|
|
(55
|
)
|
|||
Capital contribution from parent company
|
—
|
|
|
8
|
|
|
318
|
|
|||
Other, net
|
20
|
|
|
(132
|
)
|
|
(59
|
)
|
|||
Net cash provided by (used in) financing activities
|
$
|
8,705
|
|
|
$
|
1,655
|
|
|
$
|
9,070
|
|
|
|
|
|
|
|
||||||
Effect of exchange rate changes on cash and cash equivalents
|
$
|
8
|
|
|
$
|
(12
|
)
|
|
$
|
22
|
|
Change in cash and cash equivalents
|
1
|
|
|
(345
|
)
|
|
(840
|
)
|
|||
Cash and cash equivalents, beginning of year
|
4,469
|
|
|
4,814
|
|
|
5,654
|
|
|||
Change in cash of businesses held for sale
|
(65
|
)
|
|
—
|
|
|
—
|
|
|||
Cash and cash equivalents, end of year
|
$
|
4,405
|
|
|
$
|
4,469
|
|
|
$
|
4,814
|
|
|
|
|
|
|
|
||||||
Supplemental cash flow information:
|
|
|
|
|
|
||||||
Interest paid
|
$
|
273
|
|
|
$
|
178
|
|
|
$
|
119
|
|
Income taxes (refunded) paid
|
$
|
(506
|
)
|
|
$
|
57
|
|
|
$
|
31
|
|
|
|
|
|
|
|
||||||
Non-cash transactions:
|
|
|
|
|
|
||||||
Capital contribution from parent company
|
$
|
—
|
|
|
$
|
622
|
|
|
$
|
—
|
|
(Settlement) issuance of long-term debt
|
$
|
—
|
|
|
$
|
(202
|
)
|
|
$
|
202
|
|
Transfer of assets to reinsurer
|
$
|
—
|
|
|
$
|
(604
|
)
|
|
$
|
—
|
|
Contribution of 0.5% minority interest in AXA Financial, Inc.
|
$
|
—
|
|
|
$
|
65
|
|
|
$
|
—
|
|
Repayment of loans from affiliates
|
$
|
—
|
|
|
$
|
(622
|
)
|
|
$
|
—
|
|
•
|
The Individual Retirement segment offers a diverse suite of variable annuity products which are primarily sold to affluent and high net worth individuals saving for retirement or seeking retirement income.
|
•
|
The Group Retirement segment offers tax-deferred investment and retirement services or products to plans sponsored by educational entities, municipalities and not-for-profit entities, as well as small and medium-sized businesses.
|
•
|
The Investment Management and Research segment provides diversified investment management, research and related solutions globally to a broad range of clients through three main client channels - Institutional, Retail and Private Wealth Management - and distributes its institutional research products and solutions through Bernstein Research Services. The Investment Management and Research segment reflects the business of AllianceBernstein Holding L.P. (“AB Holding”), AllianceBernstein L.P. (“ABLP”) and their subsidiaries (collectively, “AB”).
|
•
|
The Protection Solutions segment includes the Company’s life insurance and group employee benefits businesses. The life insurance business offers a variety of variable universal life, indexed universal life and term life products to help affluent and high net worth individuals, as well as small and medium-sized business owners, with their wealth protection, wealth transfer and corporate needs. Our group employee benefits business offers a suite of life, short- and long-term disability, dental and vision insurance products to small and medium-size businesses across the United States.
|
•
|
Loan-to-value ratio – Derived from current loan balance divided by the fair market value of the property. An allowance for credit loss is typically recommended when the loan-to-value ratio is in excess of 100%. In the case where the loan-to-value is in excess of 100%, the allowance for credit loss is derived by taking the difference between the fair market value (less cost of sale) and the current loan balance.
|
•
|
Debt service coverage ratio – Derived from actual operating earnings divided by annual debt service. If the ratio is below 1.0x, then the income from the property does not support the debt.
|
•
|
Occupancy – Criteria varies by property type but low or below market occupancy is an indicator of sub-par property performance.
|
•
|
Lease expirations – The percentage of leases expiring in the upcoming 12 to 36 months are monitored as a decline in rent and/or occupancy may negatively impact the debt service coverage ratio. In the case of single-tenant properties or properties with large tenant exposure, the lease expiration is a material risk factor.
|
•
|
Maturity – Mortgage loans that are not fully amortizing and have upcoming maturities within the next 12 to 24 months are monitored in conjunction with the capital markets to determine the borrower’s ability to refinance the debt and/or pay off the balloon balance.
|
•
|
Borrower/tenant related issues – Financial concerns, potential bankruptcy or words or actions that indicate imminent default or abandonment of property.
|
•
|
Payment status (current vs. delinquent) – A history of delinquent payments may be a cause for concern.
|
•
|
Property condition – Significant deferred maintenance observed during the lenders annual site inspections.
|
•
|
Other – Any other factors such as current economic conditions may call into question the performance of the loan.
|
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Fair Value
|
|
OTTI in AOCI (4)
|
||||||||||
|
(in millions)
|
||||||||||||||||||
December 31, 2019 (5):
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed Maturities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Corporate (1)
|
$
|
45,900
|
|
|
$
|
2,361
|
|
|
$
|
62
|
|
|
$
|
48,199
|
|
|
$
|
—
|
|
U.S. Treasury, government and agency
|
14,410
|
|
|
1,289
|
|
|
305
|
|
|
15,394
|
|
|
—
|
|
|||||
States and political subdivisions
|
638
|
|
|
70
|
|
|
3
|
|
|
705
|
|
|
—
|
|
|||||
Foreign governments
|
462
|
|
|
35
|
|
|
5
|
|
|
492
|
|
|
—
|
|
|||||
Residential mortgage-backed (2)
|
178
|
|
|
13
|
|
|
—
|
|
|
191
|
|
|
—
|
|
|||||
Asset-backed (3)
|
848
|
|
|
4
|
|
|
3
|
|
|
849
|
|
|
—
|
|
|||||
Redeemable preferred stock
|
501
|
|
|
17
|
|
|
5
|
|
|
513
|
|
|
—
|
|
|||||
Total at December 31, 2019
|
$
|
62,937
|
|
|
$
|
3,789
|
|
|
$
|
383
|
|
|
$
|
66,343
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed Maturities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Corporate (1)
|
$
|
30,572
|
|
|
$
|
406
|
|
|
$
|
800
|
|
|
$
|
30,178
|
|
|
$
|
—
|
|
U.S. Treasury, government and agency
|
14,004
|
|
|
295
|
|
|
470
|
|
|
13,829
|
|
|
—
|
|
|||||
States and political subdivisions
|
415
|
|
|
47
|
|
|
1
|
|
|
461
|
|
|
—
|
|
|||||
Foreign governments
|
524
|
|
|
19
|
|
|
13
|
|
|
530
|
|
|
—
|
|
|||||
Residential mortgage-backed (2)
|
225
|
|
|
10
|
|
|
1
|
|
|
234
|
|
|
—
|
|
|||||
Asset-backed (3)
|
612
|
|
|
1
|
|
|
12
|
|
|
601
|
|
|
2
|
|
|||||
Redeemable preferred stock
|
449
|
|
|
15
|
|
|
18
|
|
|
446
|
|
|
—
|
|
|||||
Total at December 31, 2018
|
$
|
46,801
|
|
|
$
|
793
|
|
|
$
|
1,315
|
|
|
$
|
46,279
|
|
|
$
|
2
|
|
(1)
|
Corporate fixed maturities include both public and private issues.
|
(2)
|
Includes publicly traded agency pass-through securities and collateralized obligations.
|
(3)
|
Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans.
|
(4)
|
Amounts represent OTTI losses in AOCI, which were not included in Net income (loss).
|
(5)
|
Excludes amounts reclassified as Held-for-Sale.
|
|
Amortized Cost
|
|
Fair Value
|
||||
|
(in millions)
|
||||||
December 31, 2019 (1):
|
|
|
|
||||
Due in one year or less
|
$
|
3,921
|
|
|
$
|
3,938
|
|
Due in years two through five
|
14,288
|
|
|
14,721
|
|
||
Due in years six through ten
|
18,391
|
|
|
19,585
|
|
||
Due after ten years
|
24,810
|
|
|
26,546
|
|
||
Subtotal
|
61,410
|
|
|
64,790
|
|
||
Residential mortgage-backed securities
|
178
|
|
|
191
|
|
||
Asset-backed securities
|
848
|
|
|
849
|
|
||
Redeemable preferred stock
|
501
|
|
|
513
|
|
||
Total at December 31, 2019
|
$
|
62,937
|
|
|
$
|
66,343
|
|
(1)
|
Excludes amounts reclassified as Held-for-Sale.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Proceeds from sales
|
$
|
8,972
|
|
|
$
|
8,523
|
|
|
$
|
8,213
|
|
Gross gains on sales
|
$
|
234
|
|
|
$
|
180
|
|
|
$
|
107
|
|
Gross losses on sales
|
$
|
(32
|
)
|
|
$
|
(215
|
)
|
|
$
|
(259
|
)
|
|
|
|
|
|
|
||||||
Total OTTI
|
$
|
—
|
|
|
$
|
(42
|
)
|
|
$
|
(15
|
)
|
Non-credit losses recognized in OCI
|
—
|
|
|
—
|
|
|
—
|
|
|||
Credit losses recognized in net income (loss)
|
$
|
—
|
|
|
$
|
(42
|
)
|
|
$
|
(15
|
)
|
|
Years Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Balance at January 1,
|
$
|
(58
|
)
|
|
$
|
(18
|
)
|
Previously recognized impairments on securities that matured, paid, prepaid or sold
|
37
|
|
|
2
|
|
||
Recognized impairments on securities impaired to fair value this period (1)
|
—
|
|
|
—
|
|
||
Impairments recognized this period on securities not previously impaired
|
—
|
|
|
(42
|
)
|
||
Additional impairments this period on securities previously impaired
|
—
|
|
|
—
|
|
||
Increases due to passage of time on previously recorded credit losses
|
—
|
|
|
—
|
|
||
Accretion of previously recognized impairments due to increases in expected cash flows
|
—
|
|
|
—
|
|
||
Balance at December 31,
|
$
|
(21
|
)
|
|
$
|
(58
|
)
|
(1)
|
Represents circumstances where the Company determined in the current period that it intends to sell the security, or it is more likely than not that it will be required to sell the security before recovery of the security’s amortized cost.
|
|
Net Unrealized Gains (Losses) on Investments
|
|
DAC
|
|
Policyholders’ Liabilities
|
|
Deferred Income Tax Asset (Liability)
|
|
AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Balance, January 1, 2019
|
$
|
(522
|
)
|
|
$
|
100
|
|
|
$
|
(73
|
)
|
|
$
|
104
|
|
|
$
|
(391
|
)
|
Net investment gains (losses) arising during the period
|
4,188
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,188
|
|
|||||
Reclassification adjustment:
|
|
|
|
|
|
|
|
|
|
||||||||||
Included in Net income (loss)
|
(213
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(213
|
)
|
|||||
Excluded from Net income (loss) (1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Impact of net unrealized investment gains (losses) on:
|
|
|
|
|
|
|
|
|
|
||||||||||
DAC
|
—
|
|
|
(999
|
)
|
|
—
|
|
|
—
|
|
|
(999
|
)
|
|||||
Deferred income taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
(601
|
)
|
|
(601
|
)
|
|||||
Policyholders’ liabilities
|
—
|
|
|
—
|
|
|
(116
|
)
|
|
—
|
|
|
(116
|
)
|
|||||
Net unrealized investment gains (losses) excluding OTTI losses
|
3,453
|
|
|
(899
|
)
|
|
(189
|
)
|
|
(497
|
)
|
|
1,868
|
|
|||||
Net unrealized investment gains (losses) with OTTI losses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance, December 31, 2019
|
$
|
3,453
|
|
|
$
|
(899
|
)
|
|
$
|
(189
|
)
|
|
$
|
(497
|
)
|
|
$
|
1,868
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance, January 1, 2018
|
$
|
1,871
|
|
|
$
|
(358
|
)
|
|
$
|
(238
|
)
|
|
$
|
(397
|
)
|
|
$
|
878
|
|
Net investment gains (losses) arising during the period
|
(2,470
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,470
|
)
|
|||||
Reclassification adjustment:
|
|
|
|
|
|
|
|
|
|
||||||||||
Included in Net income (loss)
|
77
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
77
|
|
|||||
Excluded from Net income (loss) (1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Impact of net unrealized investment gains (losses) on:
|
|
|
|
|
|
|
|
|
|
||||||||||
DAC
|
—
|
|
|
458
|
|
|
—
|
|
|
—
|
|
|
458
|
|
|||||
Deferred income taxes (2)
|
—
|
|
|
—
|
|
|
—
|
|
|
501
|
|
|
501
|
|
|||||
Policyholders’ liabilities
|
—
|
|
|
—
|
|
|
165
|
|
|
—
|
|
|
165
|
|
|||||
Net unrealized investment gains (losses) excluding OTTI losses
|
(522
|
)
|
|
100
|
|
|
(73
|
)
|
|
104
|
|
|
(391
|
)
|
|||||
Net unrealized investment gains (losses) with OTTI losses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance, December 31, 2018
|
$
|
(522
|
)
|
|
$
|
100
|
|
|
$
|
(73
|
)
|
|
$
|
104
|
|
|
$
|
(391
|
)
|
(1)
|
Represents “transfers out” related to the portion of OTTI losses during the period that were not recognized in Net income (loss) for securities with no prior OTTI loss.
|
(2)
|
Includes a $113 million benefit from the impact of adoption of ASU 2018-02.
|
|
Less Than 12 Months
|
|
12 Months or Longer
|
|
Total
|
||||||||||||||||||
|
Fair Value
|
|
Gross Unrealized Losses
|
|
Fair Value
|
|
Gross Unrealized Losses
|
|
Fair Value
|
|
Gross Unrealized Losses
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
December 31, 2019 (1):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed Maturities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Corporate
|
$
|
2,773
|
|
|
$
|
42
|
|
|
$
|
373
|
|
|
$
|
20
|
|
|
$
|
3,146
|
|
|
$
|
62
|
|
U.S. Treasury, government and agency
|
4,309
|
|
|
305
|
|
|
2
|
|
|
—
|
|
|
4,311
|
|
|
305
|
|
||||||
States and political subdivisions
|
112
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
112
|
|
|
3
|
|
||||||
Foreign governments
|
11
|
|
|
—
|
|
|
47
|
|
|
5
|
|
|
58
|
|
|
5
|
|
||||||
Asset-backed
|
319
|
|
|
1
|
|
|
201
|
|
|
2
|
|
|
520
|
|
|
3
|
|
||||||
Redeemable preferred stock
|
29
|
|
|
—
|
|
|
49
|
|
|
5
|
|
|
78
|
|
|
5
|
|
||||||
Total at December 31, 2019
|
$
|
7,553
|
|
|
$
|
351
|
|
|
$
|
672
|
|
|
$
|
32
|
|
|
$
|
8,225
|
|
|
$
|
383
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed Maturities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Corporate
|
$
|
8,964
|
|
|
$
|
313
|
|
|
$
|
8,244
|
|
|
$
|
487
|
|
|
$
|
17,208
|
|
|
$
|
800
|
|
U.S. Treasury, government and agency
|
1,077
|
|
|
53
|
|
|
4,306
|
|
|
417
|
|
|
5,383
|
|
|
470
|
|
||||||
States and political subdivisions
|
—
|
|
|
—
|
|
|
19
|
|
|
1
|
|
|
19
|
|
|
1
|
|
||||||
Foreign governments
|
109
|
|
|
3
|
|
|
76
|
|
|
10
|
|
|
185
|
|
|
13
|
|
||||||
Residential mortgage-backed
|
—
|
|
|
—
|
|
|
29
|
|
|
1
|
|
|
29
|
|
|
1
|
|
||||||
Asset-backed
|
563
|
|
|
11
|
|
|
13
|
|
|
1
|
|
|
576
|
|
|
12
|
|
||||||
Redeemable preferred stock
|
165
|
|
|
13
|
|
|
33
|
|
|
5
|
|
|
198
|
|
|
18
|
|
||||||
Total at December 31, 2018
|
$
|
10,878
|
|
|
$
|
393
|
|
|
$
|
12,720
|
|
|
$
|
922
|
|
|
$
|
23,598
|
|
|
$
|
1,315
|
|
(1)
|
Excludes amounts reclassified as Held-for-Sale.
|
|
Debt Service Coverage Ratio (1)
|
|
Total Mortgage Loans
|
||||||||||||||||||||||||
Loan-to-Value Ratio (2):
|
Greater than 2.0x
|
|
1.8x to
2.0x |
|
1.5x to
1.8x |
|
1.2x to
1.5x |
|
1.0x to
1.2x |
|
Less than
1.0x |
|
|||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||
December 31, 2019:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial Mortgage Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
0% - 50%
|
$
|
903
|
|
|
$
|
38
|
|
|
$
|
214
|
|
|
$
|
25
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,180
|
|
50% - 70%
|
4,097
|
|
|
1,195
|
|
|
1,118
|
|
|
795
|
|
|
242
|
|
|
—
|
|
|
7,447
|
|
|||||||
70% - 90%
|
251
|
|
|
98
|
|
|
214
|
|
|
154
|
|
|
46
|
|
|
—
|
|
|
763
|
|
|||||||
90% plus
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total Commercial Mortgage Loans
|
$
|
5,251
|
|
|
$
|
1,331
|
|
|
$
|
1,546
|
|
|
$
|
974
|
|
|
$
|
288
|
|
|
$
|
—
|
|
|
$
|
9,390
|
|
Agricultural Mortgage Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
0% - 50%
|
$
|
322
|
|
|
$
|
104
|
|
|
$
|
241
|
|
|
$
|
545
|
|
|
$
|
321
|
|
|
$
|
50
|
|
|
$
|
1,583
|
|
50% - 70%
|
82
|
|
|
87
|
|
|
236
|
|
|
426
|
|
|
251
|
|
|
33
|
|
|
1,115
|
|
|||||||
70% - 90%
|
—
|
|
|
—
|
|
|
—
|
|
|
19
|
|
|
—
|
|
|
—
|
|
|
19
|
|
|||||||
90% plus
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total Agricultural Mortgage Loans
|
$
|
404
|
|
|
$
|
191
|
|
|
$
|
477
|
|
|
$
|
990
|
|
|
$
|
572
|
|
|
$
|
83
|
|
|
$
|
2,717
|
|
Total Mortgage Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
0% - 50%
|
$
|
1,225
|
|
|
$
|
142
|
|
|
$
|
455
|
|
|
$
|
570
|
|
|
$
|
321
|
|
|
$
|
50
|
|
|
$
|
2,763
|
|
50% - 70%
|
4,179
|
|
|
1,282
|
|
|
1,354
|
|
|
1,221
|
|
|
493
|
|
|
33
|
|
|
8,562
|
|
|||||||
70% - 90%
|
251
|
|
|
98
|
|
|
214
|
|
|
173
|
|
|
46
|
|
|
—
|
|
|
782
|
|
|||||||
90% plus
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total Mortgage Loans
|
$
|
5,655
|
|
|
$
|
1,522
|
|
|
$
|
2,023
|
|
|
$
|
1,964
|
|
|
$
|
860
|
|
|
$
|
83
|
|
|
$
|
12,107
|
|
|
Debt Service Coverage Ratio (1)
|
|
Total Mortgage Loans
|
||||||||||||||||||||||||
Loan-to-Value Ratio (2):
|
Greater than 2.0x
|
|
1.8x to
2.0x |
|
1.5x to
1.8x |
|
1.2x to
1.5x |
|
1.0x to
1.2x |
|
Less than
1.0x |
|
|||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial Mortgage Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
0% - 50%
|
$
|
797
|
|
|
$
|
21
|
|
|
$
|
247
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,089
|
|
50% - 70%
|
4,908
|
|
|
656
|
|
|
1,146
|
|
|
325
|
|
|
151
|
|
|
—
|
|
|
7,186
|
|
|||||||
70% - 90%
|
260
|
|
|
—
|
|
|
117
|
|
|
370
|
|
|
98
|
|
|
—
|
|
|
845
|
|
|||||||
90% plus
|
—
|
|
|
—
|
|
|
—
|
|
|
27
|
|
|
—
|
|
|
—
|
|
|
27
|
|
|||||||
Total Commercial Mortgage Loans
|
$
|
5,965
|
|
|
$
|
677
|
|
|
$
|
1,510
|
|
|
$
|
746
|
|
|
$
|
249
|
|
|
$
|
—
|
|
|
$
|
9,147
|
|
Agricultural Mortgage Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
0% - 50%
|
$
|
282
|
|
|
$
|
147
|
|
|
$
|
267
|
|
|
$
|
543
|
|
|
$
|
321
|
|
|
$
|
51
|
|
|
$
|
1,611
|
|
50% - 70%
|
112
|
|
|
46
|
|
|
246
|
|
|
379
|
|
|
224
|
|
|
31
|
|
|
1,038
|
|
|||||||
70% - 90%
|
—
|
|
|
—
|
|
|
—
|
|
|
19
|
|
|
27
|
|
|
—
|
|
|
46
|
|
|||||||
90% plus
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total Agricultural Mortgage Loans
|
$
|
394
|
|
|
$
|
193
|
|
|
$
|
513
|
|
|
$
|
941
|
|
|
$
|
572
|
|
|
$
|
82
|
|
|
$
|
2,695
|
|
Total Mortgage Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
0% - 50%
|
$
|
1,079
|
|
|
$
|
168
|
|
|
$
|
514
|
|
|
$
|
567
|
|
|
$
|
321
|
|
|
$
|
51
|
|
|
$
|
2,700
|
|
50% - 70%
|
5,020
|
|
|
702
|
|
|
1,392
|
|
|
704
|
|
|
375
|
|
|
31
|
|
|
8,224
|
|
|||||||
70% - 90%
|
260
|
|
|
—
|
|
|
117
|
|
|
389
|
|
|
125
|
|
|
—
|
|
|
891
|
|
|||||||
90% plus
|
—
|
|
|
—
|
|
|
—
|
|
|
27
|
|
|
—
|
|
|
—
|
|
|
27
|
|
|||||||
Total Mortgage Loans
|
$
|
6,359
|
|
|
$
|
870
|
|
|
$
|
2,023
|
|
|
$
|
1,687
|
|
|
$
|
821
|
|
|
$
|
82
|
|
|
$
|
11,842
|
|
(1)
|
The debt service coverage ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.
|
(2)
|
The loan-to-value ratio is derived from current loan balance divided by the most recent fair value estimate of the property. The fair value of the underlying commercial properties is updated annually.
|
|
30-59 Days
|
|
60-89 Days
|
|
90 Days or More
|
|
Total
|
|
Current
|
|
Total Financing Receivables
|
|
Recorded Investment 90 Days or More and Accruing
|
||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||
December 31, 2019:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9,390
|
|
|
$
|
9,390
|
|
|
$
|
—
|
|
Agricultural
|
57
|
|
|
1
|
|
|
66
|
|
|
124
|
|
|
2,593
|
|
|
2,717
|
|
|
66
|
|
|||||||
Total Mortgage Loans
|
$
|
57
|
|
|
$
|
1
|
|
|
$
|
66
|
|
|
$
|
124
|
|
|
$
|
11,983
|
|
|
$
|
12,107
|
|
|
$
|
66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
27
|
|
|
$
|
27
|
|
|
$
|
9,120
|
|
|
$
|
9,147
|
|
|
$
|
—
|
|
Agricultural
|
18
|
|
|
8
|
|
|
42
|
|
|
68
|
|
|
2,627
|
|
|
2,695
|
|
|
40
|
|
|||||||
Total Mortgage Loans
|
$
|
18
|
|
|
$
|
8
|
|
|
$
|
69
|
|
|
$
|
95
|
|
|
$
|
11,747
|
|
|
$
|
11,842
|
|
|
$
|
40
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Fixed maturities
|
$
|
2,060
|
|
|
$
|
1,725
|
|
|
$
|
1,629
|
|
Mortgage loans on real estate
|
541
|
|
|
494
|
|
|
454
|
|
|||
Real estate held for the production of income
|
(2
|
)
|
|
(6
|
)
|
|
2
|
|
|||
Other equity investments
|
142
|
|
|
147
|
|
|
186
|
|
|||
Policy loans
|
211
|
|
|
215
|
|
|
221
|
|
|||
Trading securities
|
796
|
|
|
105
|
|
|
553
|
|
|||
Other investment income
|
24
|
|
|
85
|
|
|
109
|
|
|||
Gross investment income (loss)
|
3,772
|
|
|
2,765
|
|
|
3,154
|
|
|||
Investment expenses
|
(73
|
)
|
|
(72
|
)
|
|
(72
|
)
|
|||
Net investment income (loss)
|
$
|
3,699
|
|
|
$
|
2,693
|
|
|
$
|
3,082
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Net investment gains (losses) recognized during the period on securities held at the end of the period
|
$
|
487
|
|
|
$
|
(223
|
)
|
|
$
|
247
|
|
Net investment gains (losses) recognized on securities sold during the period
|
15
|
|
|
(14
|
)
|
|
19
|
|
|||
Unrealized and realized gains (losses) on trading securities
|
502
|
|
|
(237
|
)
|
|
266
|
|
|||
Interest and dividend income from trading securities
|
294
|
|
|
342
|
|
|
287
|
|
|||
Net investment income (loss) from trading securities
|
$
|
796
|
|
|
$
|
105
|
|
|
$
|
553
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Fixed maturities
|
$
|
205
|
|
|
$
|
(75
|
)
|
|
$
|
(194
|
)
|
Mortgage loans on real estate
|
(1
|
)
|
|
—
|
|
|
2
|
|
|||
Real estate held for the production of income
|
2
|
|
|
—
|
|
|
—
|
|
|||
Other equity investments
|
—
|
|
|
—
|
|
|
2
|
|
|||
Other
|
(133
|
)
|
|
(11
|
)
|
|
(1
|
)
|
|||
Investment gains (losses), net
|
$
|
73
|
|
|
$
|
(86
|
)
|
|
$
|
(191
|
)
|
|
At December 31, 2019
|
|
|
||||||||||||
|
|
|
Fair Value
|
|
Gains (Losses) Reported in Net Income (Loss) Year Ended December 31, 2019
|
||||||||||
|
Notional Amount
|
|
Asset Derivatives
|
|
Liability Derivatives
|
|
|||||||||
|
(in millions)
|
||||||||||||||
Freestanding Derivatives (1) (2):
|
|
|
|
|
|
|
|
||||||||
Equity contracts:
|
|
|
|
|
|
|
|
||||||||
Futures
|
$
|
4,257
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
(1,311
|
)
|
Swaps
|
17,156
|
|
|
9
|
|
|
281
|
|
|
(2,426
|
)
|
||||
Options
|
47,861
|
|
|
5,098
|
|
|
1,752
|
|
|
2,229
|
|
||||
Interest rate contracts:
|
|
|
|
|
|
|
|
||||||||
Swaps
|
23,793
|
|
|
468
|
|
|
526
|
|
|
2,037
|
|
||||
Futures
|
20,901
|
|
|
—
|
|
|
—
|
|
|
145
|
|
||||
Swaptions
|
3,201
|
|
|
16
|
|
|
—
|
|
|
(35
|
)
|
||||
Credit contracts:
|
|
|
|
|
|
|
|
||||||||
Credit default swaps
|
1,400
|
|
|
21
|
|
|
6
|
|
|
9
|
|
||||
Other freestanding contracts:
|
|
|
|
|
|
|
|
||||||||
Foreign currency contracts
|
559
|
|
|
12
|
|
|
9
|
|
|
(9
|
)
|
||||
Margin
|
—
|
|
|
155
|
|
|
—
|
|
|
—
|
|
||||
Collateral
|
—
|
|
|
74
|
|
|
3,016
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Embedded Derivatives (2):
|
|
|
|
|
|
|
|
||||||||
GMIB reinsurance contracts
|
|
|
|
2,139
|
|
|
—
|
|
|
435
|
|
||||
GMxB derivative features liability (3)
|
—
|
|
|
—
|
|
|
8,432
|
|
|
(2,432
|
)
|
||||
SCS, SIO, MSO and IUL indexed features (4)
|
—
|
|
|
—
|
|
|
3,268
|
|
|
(2,642
|
)
|
||||
Net derivative gains (losses)
|
|
|
|
|
|
|
(4,000
|
)
|
|||||||
Total
|
$
|
119,128
|
|
|
$
|
7,993
|
|
|
$
|
17,291
|
|
|
$
|
(4,000
|
)
|
(1)
|
Reported in Other invested assets in the consolidated balance sheets.
|
(2)
|
Reported in Net derivative gains (losses) in the consolidated statements of income (loss).
|
(3)
|
Reported in Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets.
|
(4)
|
SCS, SIO, MSO and IUL indexed features are reported in Policyholders’ account balances in the consolidated balance sheets.
|
|
At December 31, 2018
|
|
|
||||||||||||
|
|
|
Fair Value
|
|
Gains (Losses) Reported in Net Income (Loss) Year Ended December 31, 2018
|
||||||||||
|
Notional Amount
|
|
Asset Derivatives
|
|
Liability
Derivatives
|
|
|||||||||
|
(in millions)
|
||||||||||||||
Freestanding Derivatives (1) (2):
|
|
|
|
|
|
|
|
||||||||
Equity contracts:
|
|
|
|
|
|
|
|
||||||||
Futures
|
$
|
11,143
|
|
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
541
|
|
Swaps
|
7,796
|
|
|
143
|
|
|
168
|
|
|
715
|
|
||||
Options
|
21,821
|
|
|
2,133
|
|
|
1,164
|
|
|
(899
|
)
|
||||
Interest rate contracts:
|
|
|
|
|
|
|
|
||||||||
Swaps
|
27,116
|
|
|
634
|
|
|
196
|
|
|
(656
|
)
|
||||
Futures
|
11,792
|
|
|
—
|
|
|
—
|
|
|
112
|
|
||||
Credit contracts:
|
|
|
|
|
|
|
|
||||||||
Credit default swaps
|
1,376
|
|
|
20
|
|
|
3
|
|
|
(2
|
)
|
||||
Other freestanding contracts:
|
|
|
|
|
|
|
|
||||||||
Foreign currency contracts
|
2,184
|
|
|
35
|
|
|
22
|
|
|
6
|
|
||||
Margin
|
—
|
|
|
18
|
|
|
5
|
|
|
—
|
|
||||
Collateral
|
—
|
|
|
8
|
|
|
1,581
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Embedded Derivatives (2):
|
|
|
|
|
|
|
|
||||||||
GMIB reinsurance contracts
|
—
|
|
|
1,732
|
|
|
—
|
|
|
(162
|
)
|
||||
GMxB derivative features liability (3)
|
—
|
|
|
—
|
|
|
5,614
|
|
|
(775
|
)
|
||||
SCS, SIO, MSO and IUL indexed features (4)
|
—
|
|
|
—
|
|
|
715
|
|
|
889
|
|
||||
Net derivative gains (losses)
|
|
|
|
|
|
|
(231
|
)
|
|||||||
Cross currency swaps (5) (6)
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
||||
Total
|
$
|
83,228
|
|
|
$
|
4,725
|
|
|
$
|
9,471
|
|
|
$
|
(222
|
)
|
(1)
|
Reported in Other invested assets in the consolidated balance sheets.
|
(2)
|
Reported in Net derivative gains (losses) in the consolidated statements of income (loss).
|
(3)
|
Reported in Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets.
|
(4)
|
SCS, SIO, MSO and IUL indexed features are reported in Policyholders’ account balances in the consolidated balance sheets.
|
(5)
|
Reported in Other assets or Other liabilities in the consolidated balance sheets.
|
(6)
|
Reported in Other income in the consolidated statements of income (loss).
|
|
Gross Amount Recognized
|
|
Gross Amount Offset in the Balance Sheets
|
|
Net Amount Presented in the Balance Sheets
|
|
Gross Amount not Offset in the Balance Sheets (3)
|
|
Net Amount
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total derivatives (1)
|
$
|
5,852
|
|
|
$
|
5,466
|
|
|
$
|
386
|
|
|
$
|
(77
|
)
|
|
$
|
309
|
|
Other financial instruments
|
2,367
|
|
|
—
|
|
|
2,367
|
|
|
—
|
|
|
2,367
|
|
|||||
Other invested assets
|
$
|
8,219
|
|
|
$
|
5,466
|
|
|
$
|
2,753
|
|
|
$
|
(77
|
)
|
|
$
|
2,676
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total derivatives (2)
|
$
|
5,512
|
|
|
$
|
5,466
|
|
|
$
|
46
|
|
|
$
|
—
|
|
|
$
|
46
|
|
Other financial liabilities
|
3,924
|
|
|
—
|
|
|
3,924
|
|
|
—
|
|
|
3,924
|
|
|||||
Other liabilities
|
$
|
9,436
|
|
|
$
|
5,466
|
|
|
$
|
3,970
|
|
|
$
|
—
|
|
|
$
|
3,970
|
|
(1)
|
Excludes Investment Management and Research segment’s derivative assets of consolidated VIEs/VOEs.
|
(2)
|
Excludes Investment Management and Research segment’s derivative liabilities of consolidated VIEs/VOEs.
|
(3)
|
Includes primarily financial instrument sent (held).
|
|
Gross Amount Recognized
|
|
Gross Amount Offset in the Balance Sheets
|
|
Net Amount Presented in the Balance Sheets
|
|
Gross Amount not Offset in the Balance Sheets (6)
|
|
Net Amount
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total derivatives (1)
|
$
|
2,993
|
|
|
$
|
2,945
|
|
|
$
|
48
|
|
|
$
|
—
|
|
|
$
|
48
|
|
Other financial instruments
|
1,989
|
|
|
—
|
|
|
1,989
|
|
|
—
|
|
|
1,989
|
|
|||||
Other invested assets
|
$
|
4,982
|
|
|
$
|
2,945
|
|
|
$
|
2,037
|
|
|
$
|
—
|
|
|
$
|
2,037
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total derivatives (2)
|
$
|
3,142
|
|
|
$
|
2,945
|
|
|
$
|
197
|
|
|
$
|
—
|
|
|
$
|
197
|
|
Other financial liabilities
|
3,163
|
|
|
—
|
|
|
3,163
|
|
|
—
|
|
|
3,163
|
|
|||||
Other liabilities
|
$
|
6,305
|
|
|
$
|
2,945
|
|
|
$
|
3,360
|
|
|
$
|
—
|
|
|
$
|
3,360
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Securities sold under agreement to repurchase (3) (4) (5)
|
$
|
571
|
|
|
$
|
—
|
|
|
$
|
571
|
|
|
$
|
(588
|
)
|
|
$
|
(17
|
)
|
(1)
|
Excludes Investment Management and Research segment’s derivative assets of consolidated VIEs/VOEs.
|
(2)
|
Excludes Investment Management and Research segment’s derivative liabilities of consolidated VIEs/VOEs.
|
(3)
|
Excludes expense of $2 million included in Securities sold under agreement to repurchase on the consolidated balance sheets.
|
(4)
|
U.S. Treasury and agency securities are in Fixed maturities available for sale on consolidated balance sheets.
|
|
Remaining Contractual Maturity of the Agreements
|
||||||||||||||||||
|
Overnight and
Continuous |
|
Up to 30 days
|
|
30-90
days
|
|
Greater Than
90 days |
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Securities sold under agreement to repurchase (1):
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury and agency securities
|
$
|
—
|
|
|
$
|
571
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
571
|
|
Total
|
$
|
—
|
|
|
$
|
571
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
571
|
|
(1)
|
Excludes expense of $2 million in Securities sold under agreement to repurchase on the consolidated balance sheets.
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Closed Block Liabilities:
|
|
|
|
||||
Future policy benefits, policyholders’ account balances and other
|
$
|
6,478
|
|
|
$
|
6,709
|
|
Policyholder dividend obligation
|
2
|
|
|
—
|
|
||
Other liabilities
|
38
|
|
|
47
|
|
||
Total Closed Block liabilities
|
6,518
|
|
|
6,756
|
|
||
|
|
|
|
||||
Assets Designated to the Closed Block:
|
|
|
|
||||
Fixed maturities available-for-sale, at fair value (amortized cost of $3,558 and $3,680)
|
3,754
|
|
|
3,672
|
|
||
Mortgage loans on real estate, net of valuation allowance of $- and $-
|
1,759
|
|
|
1,824
|
|
||
Policy loans
|
706
|
|
|
736
|
|
||
Cash and other invested assets
|
82
|
|
|
76
|
|
||
Other assets
|
145
|
|
|
179
|
|
||
Total assets designated to the Closed Block
|
6,446
|
|
|
6,487
|
|
||
Excess of Closed Block liabilities over assets designated to the Closed Block
|
72
|
|
|
269
|
|
||
Amounts included in Accumulated other comprehensive income (loss):
|
|
|
|
||||
Net unrealized investment gains (losses), net of policyholders’ dividend obligation: $(2) and $0; and net of income tax: $41 and $0
|
164
|
|
|
8
|
|
||
Maximum future earnings to be recognized from closed block assets and liabilities
|
$
|
236
|
|
|
$
|
277
|
|
|
Years ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Revenues:
|
|
|
|
|
|
||||||
Premiums and other income
|
$
|
182
|
|
|
$
|
194
|
|
|
$
|
224
|
|
Net investment income (loss)
|
278
|
|
|
291
|
|
|
314
|
|
|||
Investment gains (losses), net
|
(1
|
)
|
|
(3
|
)
|
|
(20
|
)
|
|||
Total revenues
|
459
|
|
|
482
|
|
|
518
|
|
|||
|
|
|
|
|
|
||||||
Benefits and Other Deductions:
|
|
|
|
|
|
||||||
Policyholders’ benefits and dividends
|
439
|
|
|
471
|
|
|
537
|
|
|||
Other operating costs and expenses
|
2
|
|
|
3
|
|
|
2
|
|
|||
Total benefits and other deductions
|
441
|
|
|
474
|
|
|
539
|
|
|||
Net income (loss), before income taxes
|
18
|
|
|
8
|
|
|
(21
|
)
|
|||
Income tax (expense) benefit
|
(2
|
)
|
|
(3
|
)
|
|
(36
|
)
|
|||
Net income (loss)
|
$
|
16
|
|
|
$
|
5
|
|
|
$
|
(57
|
)
|
|
December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Balance, beginning of year
|
$
|
—
|
|
|
$
|
19
|
|
|
$
|
52
|
|
Unrealized investment gains (losses)
|
2
|
|
|
(19
|
)
|
|
(33
|
)
|
|||
Balance, end of year
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
19
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Balance, beginning of year
|
$
|
6,745
|
|
|
$
|
5,919
|
|
|
$
|
6,049
|
|
Capitalization of commissions, sales and issue expenses
|
754
|
|
|
701
|
|
|
687
|
|
|||
Amortization:
|
|
|
|
|
|
||||||
Impact of assumptions updates and model changes
|
46
|
|
|
286
|
|
|
112
|
|
|||
All other
|
(625
|
)
|
|
(619
|
)
|
|
(615
|
)
|
|||
Total amortization
|
(579
|
)
|
|
(333
|
)
|
|
(503
|
)
|
|||
Change in unrealized investment gains and losses
|
(999
|
)
|
|
458
|
|
|
(314
|
)
|
|||
Reclassified to Assets held-for-sale
|
(31
|
)
|
|
—
|
|
|
—
|
|
|||
Balance, end of year
|
$
|
5,890
|
|
|
$
|
6,745
|
|
|
$
|
5,919
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Balance, beginning of year
|
$
|
426
|
|
|
$
|
473
|
|
|
$
|
504
|
|
Policyholder bonus interest credits deferred
|
—
|
|
|
4
|
|
|
7
|
|
|||
Amortization charged to income
|
4
|
|
|
(51
|
)
|
|
(38
|
)
|
|||
Balance, end of year
|
$
|
430
|
|
|
$
|
426
|
|
|
$
|
473
|
|
Level 1
|
Unadjusted quoted prices for identical instruments in active markets. Level 1 fair values generally are supported by market transactions that occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
|
Level 2
|
Observable inputs other than Level 1 prices, such as quoted prices for similar instruments, quoted prices in markets that are not active, and inputs to model-derived valuations that are directly observable or can be corroborated by observable market data.
|
Level 3
|
Unobservable inputs supported by little or no market activity and often requiring significant management judgment or estimation, such as an entity’s own assumptions about the cash flows or other significant components of value that market participants would use in pricing the asset or liability.
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Investments
|
|
|
|
|
|
|
|
||||||||
Fixed maturities, available-for-sale:
|
|
|
|
|
|
|
|
||||||||
Corporate (2)
|
$
|
—
|
|
|
$
|
46,942
|
|
|
$
|
1,257
|
|
|
$
|
48,199
|
|
U.S. Treasury, government and agency
|
—
|
|
|
15,394
|
|
|
—
|
|
|
15,394
|
|
||||
States and political subdivisions
|
—
|
|
|
666
|
|
|
39
|
|
|
705
|
|
||||
Foreign governments
|
—
|
|
|
492
|
|
|
—
|
|
|
492
|
|
||||
Residential mortgage-backed (3)
|
—
|
|
|
191
|
|
|
—
|
|
|
191
|
|
||||
Asset-backed (4)
|
—
|
|
|
749
|
|
|
100
|
|
|
849
|
|
||||
Redeemable preferred stock
|
239
|
|
|
274
|
|
|
—
|
|
|
513
|
|
||||
Total fixed maturities, available-for-sale
|
239
|
|
|
64,708
|
|
|
1,396
|
|
|
66,343
|
|
||||
Other equity investments
|
13
|
|
|
—
|
|
|
97
|
|
|
110
|
|
||||
Trading securities
|
500
|
|
|
6,495
|
|
|
36
|
|
|
7,031
|
|
||||
Other invested assets:
|
|
|
|
|
|
|
|
|
|||||||
Short-term investments
|
—
|
|
|
490
|
|
|
—
|
|
|
490
|
|
||||
Assets of consolidated VIEs/VOEs
|
132
|
|
|
457
|
|
|
17
|
|
|
606
|
|
||||
Swaps
|
—
|
|
|
(327
|
)
|
|
—
|
|
|
(327
|
)
|
||||
Credit default swaps
|
—
|
|
|
15
|
|
|
—
|
|
|
15
|
|
||||
Options
|
—
|
|
|
3,346
|
|
|
—
|
|
|
3,346
|
|
||||
Swaptions
|
—
|
|
|
16
|
|
|
—
|
|
|
16
|
|
||||
Total other invested assets
|
132
|
|
|
3,997
|
|
|
17
|
|
|
4,146
|
|
||||
Cash equivalents
|
3,497
|
|
|
—
|
|
|
—
|
|
|
3,497
|
|
||||
Segregated securities
|
—
|
|
|
1,095
|
|
|
—
|
|
|
1,095
|
|
||||
GMIB reinsurance contracts asset
|
—
|
|
|
—
|
|
|
2,139
|
|
|
2,139
|
|
||||
Separate Accounts assets (5)
|
123,432
|
|
|
2,892
|
|
|
—
|
|
|
126,324
|
|
||||
Total Assets
|
$
|
127,813
|
|
|
$
|
79,187
|
|
|
$
|
3,685
|
|
|
$
|
210,685
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
GMxB derivative features’ liability
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,432
|
|
|
$
|
8,432
|
|
SCS, SIO, MSO and IUL indexed features’ liability
|
—
|
|
|
3,268
|
|
|
—
|
|
|
3,268
|
|
||||
Liabilities of consolidated VIEs and VOEs
|
1
|
|
|
9
|
|
|
—
|
|
|
10
|
|
||||
Contingent payment arrangements
|
—
|
|
|
—
|
|
|
23
|
|
|
23
|
|
||||
Total Liabilities
|
$
|
1
|
|
|
$
|
3,277
|
|
|
$
|
8,455
|
|
|
$
|
11,733
|
|
(1)
|
Excludes amounts reclassified as Held-for-Sale.
|
(2)
|
Corporate fixed maturities includes both public and private issues.
|
(3)
|
Includes publicly traded agency pass-through securities and collateralized obligations.
|
(4)
|
Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans.
|
(5)
|
Separate account assets included in the fair value hierarchy exclude investments in entities that calculate NAV per share (or its equivalent) as a practical expedient. Such investments excluded from the fair value hierarchy include investments in real estate and commercial mortgages. At December 31, 2019 the fair value of such investments was $356 million.
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Investments
|
|
|
|
|
|
|
|
||||||||
Fixed maturities, available-for-sale:
|
|
|
|
|
|
|
|
||||||||
Corporate (1)
|
$
|
—
|
|
|
$
|
28,992
|
|
|
$
|
1,186
|
|
|
$
|
30,178
|
|
U.S. Treasury, government and agency
|
—
|
|
|
13,829
|
|
|
—
|
|
|
13,829
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
States and political subdivisions
|
—
|
|
|
422
|
|
|
39
|
|
|
461
|
|
||||
Foreign governments
|
—
|
|
|
530
|
|
|
—
|
|
|
530
|
|
||||
Residential mortgage-backed (2)
|
—
|
|
|
234
|
|
|
—
|
|
|
234
|
|
||||
Asset-backed (3)
|
—
|
|
|
82
|
|
|
519
|
|
|
601
|
|
||||
Redeemable preferred stock
|
167
|
|
|
279
|
|
|
—
|
|
|
446
|
|
||||
Total fixed maturities, available-for-sale
|
167
|
|
|
44,368
|
|
|
1,744
|
|
|
46,279
|
|
||||
Other equity investments
|
11
|
|
|
—
|
|
|
74
|
|
|
85
|
|
||||
Trading securities
|
446
|
|
|
15,507
|
|
|
64
|
|
|
16,017
|
|
||||
Other invested assets
|
|
|
|
|
|
|
|
|
|||||||
Short-term investments
|
—
|
|
|
515
|
|
|
—
|
|
|
515
|
|
||||
Assets of consolidated VIEs/VOEs
|
92
|
|
|
259
|
|
|
27
|
|
|
378
|
|
||||
Swaps
|
—
|
|
|
426
|
|
|
—
|
|
|
426
|
|
||||
Credit default swaps
|
—
|
|
|
17
|
|
|
—
|
|
|
17
|
|
||||
Futures
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||
Options
|
—
|
|
|
968
|
|
|
—
|
|
|
968
|
|
||||
Total other invested assets
|
91
|
|
|
2,185
|
|
|
27
|
|
|
2,303
|
|
||||
Cash equivalents
|
3,482
|
|
|
—
|
|
|
—
|
|
|
3,482
|
|
||||
Segregated securities
|
—
|
|
|
1,170
|
|
|
—
|
|
|
1,170
|
|
||||
GMIB reinsurance contracts asset
|
—
|
|
|
—
|
|
|
1,732
|
|
|
1,732
|
|
||||
Separate Accounts assets (4)
|
106,994
|
|
|
2,747
|
|
|
21
|
|
|
109,762
|
|
||||
Total Assets
|
$
|
111,191
|
|
|
$
|
65,977
|
|
|
$
|
3,662
|
|
|
$
|
180,830
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities
|
|
|
|
|
|
|
|
||||||||
GMxB derivative features’ liability
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,614
|
|
|
$
|
5,614
|
|
SCS, SIO, MSO and IUL indexed features’ liability
|
—
|
|
|
715
|
|
|
—
|
|
|
715
|
|
||||
Liabilities of consolidated VIEs and VOEs
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
||||
Contingent payment arrangements
|
—
|
|
|
—
|
|
|
7
|
|
|
7
|
|
||||
Total Liabilities
|
$
|
—
|
|
|
$
|
722
|
|
|
$
|
5,621
|
|
|
$
|
6,343
|
|
(1)
|
Corporate fixed maturities includes both public and private issues.
|
(2)
|
Includes publicly traded agency pass-through securities and collateralized obligations.
|
(3)
|
Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans.
|
(4)
|
Separate account assets included in the fair value hierarchy exclude investments in entities that calculate NAV per share (or its equivalent) as a practical expedient. Such investments excluded from the fair value hierarchy include investments in real estate and commercial mortgages. At December 31, 2018 the fair value of such investments was $353 million.
|
|
Corporate
|
|
State and
Political Subdivisions |
|
Commercial
Mortgage- backed |
|
Asset-
backed |
|
Redeemable Preferred Stock
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Balance, January 1, 2019
|
$
|
1,186
|
|
|
$
|
39
|
|
|
$
|
—
|
|
|
$
|
519
|
|
|
$
|
—
|
|
Total gains (losses), realized and unrealized, included in:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) as:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net investment income (loss)
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Investment gains (losses), net
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Subtotal
|
4
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
|
||||||
Other comprehensive income (loss)
|
5
|
|
|
2
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|||||
Purchases
|
274
|
|
|
—
|
|
|
—
|
|
|
100
|
|
|
—
|
|
|||||
Sales
|
(122
|
)
|
|
(3
|
)
|
|
—
|
|
|
(84
|
)
|
|
—
|
|
|||||
Transfers into Level 3 (1)
|
14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Transfers out of Level 3 (1)
|
(104
|
)
|
|
—
|
|
|
—
|
|
|
(436
|
)
|
|
—
|
|
|||||
Balance, December 31, 2019
|
$
|
1,257
|
|
|
$
|
39
|
|
|
$
|
—
|
|
|
$
|
100
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance, January 1, 2018
|
$
|
1,150
|
|
|
$
|
40
|
|
|
$
|
—
|
|
|
$
|
541
|
|
|
$
|
1
|
|
Total gains (losses), realized and unrealized, included in:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) as:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net investment income (loss)
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Investment gains (losses), net
|
(9
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Subtotal
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
||||||
Other comprehensive income (loss)
|
(21
|
)
|
|
(1
|
)
|
|
—
|
|
|
(9
|
)
|
|
—
|
|
|||||
Purchases
|
334
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|||||
Sales
|
(337
|
)
|
|
(1
|
)
|
|
—
|
|
|
(30
|
)
|
|
(1
|
)
|
|||||
Transfers into Level 3 (1)
|
89
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Transfers out of Level 3 (1)
|
(28
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance, December 31, 2018
|
$
|
1,186
|
|
|
$
|
39
|
|
|
$
|
—
|
|
|
$
|
519
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance, January 1, 2017
|
$
|
857
|
|
|
$
|
42
|
|
|
$
|
373
|
|
|
$
|
120
|
|
|
$
|
1
|
|
Total gains (losses), realized and unrealized, included in:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) as:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net investment income (loss)
|
4
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|||||
Investment gains (losses), net
|
1
|
|
|
—
|
|
|
(95
|
)
|
|
15
|
|
|
—
|
|
|||||
Subtotal
|
5
|
|
|
—
|
|
|
(97
|
)
|
|
15
|
|
|
|
||||||
Other comprehensive income (loss)
|
4
|
|
|
(1
|
)
|
|
78
|
|
|
(7
|
)
|
|
—
|
|
|||||
Purchases
|
615
|
|
|
—
|
|
|
—
|
|
|
434
|
|
|
—
|
|
|||||
Sales
|
(333
|
)
|
|
(1
|
)
|
|
(354
|
)
|
|
(21
|
)
|
|
—
|
|
|||||
Transfers into Level 3 (1)
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Transfers out of Level 3 (1)
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance, December 31, 2017
|
$
|
1,150
|
|
|
$
|
40
|
|
|
$
|
—
|
|
|
$
|
541
|
|
|
$
|
1
|
|
(1)
|
Transfers into/out of the Level 3 classification are reflected at beginning of period fair values.
|
|
Other Equity Investments
|
|
GMIB Reinsurance
Contract Asset
|
|
Separate Accounts Assets
|
|
GMxB Derivative Features Liability
|
|
Contingent Payment Arrangement
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Balance, January 1, 2019
|
$
|
165
|
|
|
$
|
1,732
|
|
|
$
|
21
|
|
|
$
|
(5,614
|
)
|
|
$
|
(7
|
)
|
Total gains (losses), realized and unrealized, included in:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) as:
|
|
|
|
|
|
|
|
|
|
||||||||||
Investment gains (losses), net
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net derivative gains (losses), excluding non-performance risk
|
—
|
|
|
412
|
|
|
—
|
|
|
(3,240
|
)
|
|
—
|
|
|||||
Non-performance risk (1)
|
—
|
|
|
23
|
|
|
—
|
|
|
808
|
|
|
—
|
|
|||||
Subtotal
|
4
|
|
|
435
|
|
|
—
|
|
|
(2,432
|
)
|
|
—
|
|
|||||
Other comprehensive income (loss)
|
24
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Purchases (2)
|
14
|
|
|
44
|
|
|
—
|
|
|
(427
|
)
|
|
(17
|
)
|
|||||
Sales (3)
|
(16
|
)
|
|
(72
|
)
|
|
(1
|
)
|
|
41
|
|
|
—
|
|
|||||
Settlements (4)
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
1
|
|
|||||
Change in estimate
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Activity related to consolidated VIEs/VOEs
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|||||
Transfers into Level 3 (5)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Transfers out of Level 3 (5)
|
(38
|
)
|
|
—
|
|
|
(18
|
)
|
|
—
|
|
|
—
|
|
|||||
Balance, December 31, 2019
|
$
|
150
|
|
|
$
|
2,139
|
|
|
$
|
—
|
|
|
$
|
(8,432
|
)
|
|
$
|
(23
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance, January 1, 2018
|
$
|
99
|
|
|
$
|
1,894
|
|
|
$
|
22
|
|
|
$
|
(4,451
|
)
|
|
$
|
(15
|
)
|
Total gains (losses), realized and unrealized, included in:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) as:
|
|
|
|
|
|
|
|
|
|
||||||||||
Investment gains (losses), net
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net derivative gains (losses), excluding non-performance risk
|
—
|
|
|
(131
|
)
|
|
—
|
|
|
(1,272
|
)
|
|
—
|
|
|||||
Non-performance risk (1)
|
—
|
|
|
(33
|
)
|
|
—
|
|
|
497
|
|
|
—
|
|
|||||
Subtotal
|
(3
|
)
|
|
(164
|
)
|
|
—
|
|
|
(775
|
)
|
|
—
|
|
|||||
Other comprehensive income(loss)
|
15
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Purchases (2)
|
62
|
|
|
46
|
|
|
5
|
|
|
(412
|
)
|
|
—
|
|
|||||
Sales (3)
|
(3
|
)
|
|
(44
|
)
|
|
(1
|
)
|
|
24
|
|
|
—
|
|
|||||
Settlements (4)
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
6
|
|
|||||
Change in estimate
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Activity related to consolidated VIEs/VOEs
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Transfers into Level 3 (5)
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Transfers out of Level 3 (5)
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance, December 31, 2018
|
$
|
165
|
|
|
$
|
1,732
|
|
|
$
|
21
|
|
|
$
|
(5,614
|
)
|
|
$
|
(7
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Other Equity Investments
|
|
GMIB Reinsurance
Contract Asset
|
|
Separate Accounts Assets
|
|
GMxB Derivative Features Liability
|
|
Contingent Payment Arrangement
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Balance, January 1, 2017
|
$
|
88
|
|
|
$
|
1,735
|
|
|
$
|
17
|
|
|
$
|
(5,731
|
)
|
|
$
|
(25
|
)
|
Total gains (losses), realized and unrealized, included in:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) as:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net investment income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Investment gains (losses), net
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|||||
Net derivative gains (losses), excluding non-performance risk
|
—
|
|
|
171
|
|
|
—
|
|
|
1,809
|
|
|
—
|
|
|||||
Non-performance risk (1)
|
—
|
|
|
3
|
|
|
—
|
|
|
(157
|
)
|
|
—
|
|
|||||
Subtotal
|
—
|
|
|
174
|
|
|
(1
|
)
|
|
1,652
|
|
|
—
|
|
|||||
Other comprehensive income (loss)
|
14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Purchases (2)
|
22
|
|
|
48
|
|
|
12
|
|
|
(393
|
)
|
|
—
|
|
|||||
Sales (3)
|
(3
|
)
|
|
(63
|
)
|
|
(2
|
)
|
|
21
|
|
|
—
|
|
|||||
Settlements (4)
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
10
|
|
|||||
Activity related to consolidated VIEs/VOEs
|
(22
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Transfers into Level 3 (5)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Transfers out of Level 3 (5)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance, December 31, 2017
|
$
|
99
|
|
|
$
|
1,894
|
|
|
$
|
22
|
|
|
$
|
(4,451
|
)
|
|
$
|
(15
|
)
|
(1)
|
The Company’s non-performance risk is recorded through Net derivative gains (losses).
|
(2)
|
For the GMIB reinsurance contract asset, and GMxB derivative features liability, represents attributed fee.
|
(3)
|
For the GMIB reinsurance contract asset, represents recoveries from reinsurers and for GMxB derivative features liability represents benefits paid.
|
(4)
|
For contingent payment arrangements, it represents payments under the arrangement.
|
(5)
|
Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.
|
|
Earnings (Loss)
|
|
|
||||
|
Net Derivative Gains (Losses)
|
|
OCI
|
||||
|
(in millions)
|
||||||
Held at December 31, 2019:
|
|
|
|
||||
Change in unrealized gains (losses):
|
|
|
|
||||
Fixed maturities, available-for-sale
|
|
|
|
||||
Corporate
|
$
|
—
|
|
|
$
|
4
|
|
State and political subdivisions
|
—
|
|
|
3
|
|
||
Subtotal
|
—
|
|
|
7
|
|
||
GMIB reinsurance contracts
|
435
|
|
|
—
|
|
||
GMxB derivative features liability
|
(2,432
|
)
|
|
—
|
|
||
Total
|
$
|
(1,997
|
)
|
|
$
|
7
|
|
|
Earnings (Loss)
|
|
|
||||
|
Net Derivative Gains (Losses)
|
|
OCI
|
||||
|
(in millions)
|
||||||
Held at December 31, 2018:
|
|
|
|
||||
Change in unrealized gains (losses):
|
|
|
|
||||
Fixed maturities, available-for-sale
|
|
|
|
||||
Corporate
|
$
|
—
|
|
|
$
|
(19
|
)
|
State and political subdivisions
|
—
|
|
|
(1
|
)
|
||
Asset-backed
|
—
|
|
|
(6
|
)
|
||
Subtotal
|
—
|
|
|
(26
|
)
|
||
GMIB reinsurance contracts
|
(164
|
)
|
|
—
|
|
||
GMxB derivative features liability
|
(775
|
)
|
|
—
|
|
||
Total
|
$
|
(939
|
)
|
|
$
|
(26
|
)
|
|
|
|
|
||||
Held at December 31, 2017:
|
|
|
|
||||
Change in unrealized gains (losses):
|
|
|
|
||||
Fixed maturities, available-for-sale
|
|
|
|
||||
Corporate
|
$
|
—
|
|
|
$
|
5
|
|
State and political subdivisions
|
—
|
|
|
(1
|
)
|
||
Asset-backed
|
—
|
|
|
1
|
|
||
Subtotal
|
—
|
|
|
5
|
|
||
GMIB reinsurance contracts
|
174
|
|
|
—
|
|
||
GMxB derivative features liability
|
1,652
|
|
|
—
|
|
||
Total
|
$
|
1,826
|
|
|
$
|
5
|
|
|
Fair
Value
|
|
Valuation
Technique
|
|
Significant
Unobservable Input
|
|
Range
|
|
Weighted Average
|
||
|
(in millions)
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||
Investments:
|
|
|
|
|
|
|
|
|
|
||
Fixed maturities, available-for-sale:
|
|
|
|
|
|
|
|
|
|
||
Corporate
|
$
|
57
|
|
|
Matrix pricing model
|
|
Spread over Benchmark
|
|
65 - 580 bps
|
|
184 bps
|
|
1,025
|
|
|
Market
comparable companies |
|
EBITDA multiples
Discount rate Cash flow multiples |
|
3.3x - 56.7x
3.9% - 16.5% 0.8x - 48.1x |
|
14.3x
10.0% 10.7x |
|
Other equity investments
|
36
|
|
|
Discounted cash flow
|
|
Earnings multiple
Discount factor Discount years |
|
8.0x
10.0% 11 |
|
|
|
GMIB reinsurance contract asset
|
2,139
|
|
|
Discounted cash flow
|
|
Non-performance risk
Lapse rates Withdrawal rates Utilization rates Volatility rates - Equity Mortality rates (1): Ages 0 - 40 Ages 41 - 60 Ages 61 - 115 |
|
55 - 109 bps
0.8% - 10% 0.0% - 8.0% 0.0% - 49.0% 9.0% - 30.0% 0.01% - 0.18% 0.07% - 0.54% 0.42% - 42.20% |
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||
GMIBNLG
|
8,128
|
|
|
Discounted cash flow
|
|
Non-performance risk
Lapse rates Withdrawal rates Annuitization Mortality rates (1): Ages 0 - 40 Ages 41 - 60 Ages 61 - 115 |
|
124 bps
0.8% - 19.9% 0.3% - 11.0% 0.0% - 100% 0.01% - 0.19% 0.06% - 0.53% 0.41% - 41.39% |
|
|
|
Assumed GMIB Reinsurance Contracts
|
186
|
|
|
Discounted cash flow
|
|
Non-performance risk
Lapse rates Withdrawal rates (Age 0 - 85) Withdrawal rates (Age 86+) Utilization rates Volatility rates - Equity |
|
0.61% - 1.41%
1.1% - 11.1% 0.6% - 22.2% 1.1% - 100.0% 0.0% - 30.0% 9.0% - 30.0% |
|
|
|
GWBL/GMWB
|
109
|
|
|
Discounted cash flow
|
|
Non-performance risk
Lapse rates Withdrawal rates Utilization rates Volatility rates - Equity |
|
124.0 bps
0.8% - 10.0% 0.0% - 7.0% 100% after starting 9.0% - 30.0% |
|
|
|
GIB
|
5
|
|
|
Discounted cash flow
|
|
Non-performance risk
Lapse rates Withdrawal rates Utilization rates Volatility rates - Equity |
|
124.0 bps
1.2% - 19.9% 0.0% - 8.0% 0.0% - 100.0% 9.0% - 30.0% |
|
|
|
GMAB
|
4
|
|
|
Discounted cash flow
|
|
Lapse rates
Volatility rates - Equity |
|
1.0% - 10.0%
9.0% - 30.0% |
|
|
(1)
|
Mortality rates vary by age and demographic characteristic such as gender. Mortality rate assumptions are based on a combination of company and industry experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuating the embedded derivatives.
|
|
Fair
Value |
|
Valuation
Technique |
|
Significant
Unobservable Input |
|
Range
|
|
Weighted Average
|
||
|
(in millions)
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||
Investments:
|
|
|
|
|
|
|
|
|
|
||
Fixed maturities, available-for-sale:
|
|
|
|
|
|
|
|
|
|
||
Corporate
|
$
|
99
|
|
|
Matrix pricing model
|
|
Spread over benchmark
|
|
15 - 580 bps
|
|
109 bps
|
|
881
|
|
|
Market comparable companies
|
|
EBITDA multiples
Discount rate Cash flow multiples |
|
4.1x - 37.8x
6.4% - 16.5% 1.8x - 18.0x |
|
12.1x
10.7% 11.4x |
|
Other equity investments
|
35
|
|
|
Discounted cash flow
|
|
Earnings multiple
Discounts factor Discount years |
|
9.4x
10.0% 12 |
|
|
|
GMIB reinsurance contract asset
|
1,732
|
|
|
Discounted Cash flow
|
|
Non-performance risk
Lapse rates Withdrawal rates Utilization rates Volatility rates - Equity Mortality rates (1): Ages 0 - 40 Ages 41 - 60 Ages 60 - 115 |
|
74 - 159 bps
1% - 6.27% 0% - 8% 0% - 16% 10% - 34% 0.01% - 0.18% 0.07% - 0.54% 0.42% - 42.0% |
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||
GMIBNLG
|
5,341
|
|
|
Discounted cash flow
|
|
Non-performance risk
Lapse rates Withdrawal rates Annuitization rates Mortality rates (1): Ages 0 - 40 Ages 41 - 60 Ages 60 - 115 |
|
189 bps
0.8% - 26.2% 0.0% - 12.1% 0.0% - 100.0% 0.01% - 0.19% 0.06% - 0.53% 0.41% - 41.2% |
|
|
|
Assumed GMIB Reinsurance Contracts
|
183
|
|
|
Discounted cash flow
|
|
Non-performance risk
Lapse rates Withdrawal rates (Age 0 - 85) Withdrawal rates (Age 86+) Utilization rates Volatility rates - Equity |
|
1.1% - 2.4%
1.1% - 11.2% 0.7% - 22.2% 1.3% - 100.0% 0.0% - 30.0% 10.0% - 34.0% |
|
|
|
GWBL/GMWB
|
130
|
|
|
Discounted cash flow
|
|
Non-performance risk
Lapse rates Withdrawal rates Utilization rates Volatility rates - Equity |
|
189 bps
0.5% - 5.7% 0.0% - 7.0% 100% after starting 10.0% - 34.0% |
|
|
|
GIB
|
(48
|
)
|
|
Discounted cash flow
|
|
Non-performance risk
Lapse rates Withdrawal rates Utilization rates Volatility rates - Equity |
|
189 bps
0.5% - 5.7% 0.0% - 8.0% 0.0% - 16.0% 10.0% - 34.0% |
|
|
|
GMAB
|
7
|
|
|
Discounted cash flow
|
|
Lapse rates
Volatility rates - Equity |
|
0.5% - 11.0%
10.0% - 34.0% |
|
|
(1)
|
Mortality rates vary by age and demographic characteristic such as gender. Mortality rate assumptions are based on a combination of company and industry experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuating the embedded derivatives.
|
|
Carrying
Value |
|
Fair Value
|
||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||
|
(in millions)
|
||||||||||||||||||
December 31, 2019:
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage loans on real estate
|
$
|
12,107
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
12,334
|
|
|
$
|
12,334
|
|
Policy loans (1)
|
$
|
3,735
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,707
|
|
|
$
|
4,707
|
|
Policyholders’ liabilities: Investment contracts (1)
|
$
|
2,056
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,167
|
|
|
$
|
2,167
|
|
FHLBNY funding agreements
|
$
|
6,909
|
|
|
$
|
—
|
|
|
$
|
6,957
|
|
|
$
|
—
|
|
|
$
|
6,957
|
|
Short-term and long-term debt
|
$
|
4,111
|
|
|
$
|
—
|
|
|
$
|
4,476
|
|
|
$
|
—
|
|
|
$
|
4,476
|
|
Separate Accounts liabilities
|
$
|
9,041
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9,041
|
|
|
$
|
9,041
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage loans on real estate
|
$
|
11,835
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11,494
|
|
|
$
|
11,494
|
|
Policy loans
|
$
|
3,779
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,183
|
|
|
$
|
4,183
|
|
Policyholders’ liabilities: Investment contracts
|
$
|
2,127
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,174
|
|
|
$
|
2,174
|
|
FHLBNY funding agreements
|
$
|
4,002
|
|
|
$
|
—
|
|
|
$
|
3,956
|
|
|
$
|
—
|
|
|
$
|
3,956
|
|
Short-term and long-term debt
|
$
|
4,955
|
|
|
$
|
—
|
|
|
$
|
4,749
|
|
|
$
|
—
|
|
|
$
|
4,749
|
|
Separate Accounts liabilities
|
$
|
7,406
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,406
|
|
|
$
|
7,406
|
|
(1)
|
Excludes amounts reclassified as Held-for-Sale.
|
•
|
Return of Premium: the benefit is the greater of current account value or premiums paid (adjusted for withdrawals);
|
•
|
Ratchet: the benefit is the greatest of current account value, premiums paid (adjusted for withdrawals), or the highest account value on any anniversary up to contractually specified ages (adjusted for withdrawals);
|
•
|
Roll-Up: the benefit is the greater of current account value or premiums paid (adjusted for withdrawals) accumulated at contractually specified interest rates up to specified ages;
|
•
|
Combo: the benefit is the greater of the ratchet benefit or the roll-up benefit, which may include either a five year or an annual reset; or
|
•
|
Withdrawal: the withdrawal is guaranteed up to a maximum amount per year for life.
|
|
GMDB
|
|
GMIB
|
||||||||||||||||||||
|
Direct
|
|
Assumed
|
|
Ceded
|
|
Direct
|
|
Assumed
|
|
Ceded
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Balance at January 1, 2017
|
$
|
3,164
|
|
|
$
|
121
|
|
|
$
|
(90
|
)
|
|
$
|
3,802
|
|
|
$
|
258
|
|
|
$
|
(1,737
|
)
|
Paid guarantee benefits
|
(354
|
)
|
|
(21
|
)
|
|
14
|
|
|
(151
|
)
|
|
(59
|
)
|
|
63
|
|
||||||
Other changes in reserve
|
1,249
|
|
|
(5
|
)
|
|
(32
|
)
|
|
1,101
|
|
|
(4
|
)
|
|
(220
|
)
|
||||||
Balance at December 31, 2017
|
4,059
|
|
|
95
|
|
|
(108
|
)
|
|
4,752
|
|
|
195
|
|
|
(1,894
|
)
|
||||||
Paid guarantee benefits
|
(393
|
)
|
|
(24
|
)
|
|
16
|
|
|
(153
|
)
|
|
(12
|
)
|
|
44
|
|
||||||
Other changes in reserve
|
993
|
|
|
11
|
|
|
(21
|
)
|
|
(856
|
)
|
|
1
|
|
|
118
|
|
||||||
Balance at December 31, 2018
|
4,659
|
|
|
82
|
|
|
(113
|
)
|
|
3,743
|
|
|
184
|
|
|
(1,732
|
)
|
|
GMDB
|
|
GMIB
|
||||||||||||||||||||
|
Direct
|
|
Assumed
|
|
Ceded
|
|
Direct
|
|
Assumed
|
|
Ceded
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Paid guarantee benefits
|
(438
|
)
|
|
(21
|
)
|
|
14
|
|
|
(256
|
)
|
|
7
|
|
|
72
|
|
||||||
Other changes in reserve
|
563
|
|
|
15
|
|
|
(6
|
)
|
|
1,204
|
|
|
(4
|
)
|
|
(479
|
)
|
||||||
Balance at December 31, 2019
|
$
|
4,784
|
|
|
$
|
76
|
|
|
$
|
(105
|
)
|
|
$
|
4,691
|
|
|
$
|
187
|
|
|
$
|
(2,139
|
)
|
|
Guarantee Type
|
||||||||||||||||||
|
Return of Premium
|
|
Ratchet
|
|
Roll-Up
|
|
Combo
|
|
Total
|
||||||||||
|
(in millions, except age and interest rate)
|
||||||||||||||||||
Variable annuity contracts with GMDB features
|
|
|
|
|
|
|
|
|
|
||||||||||
Account Values invested in:
|
|
|
|
|
|
|
|
|
|
||||||||||
General Account
|
$
|
14,571
|
|
|
$
|
92
|
|
|
$
|
58
|
|
|
$
|
175
|
|
|
$
|
14,896
|
|
Separate Accounts
|
48,920
|
|
|
9,258
|
|
|
3,190
|
|
|
33,120
|
|
|
94,488
|
|
|||||
Total Account Values
|
$
|
63,491
|
|
|
$
|
9,350
|
|
|
$
|
3,248
|
|
|
$
|
33,295
|
|
|
$
|
109,384
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Amount at Risk, gross
|
$
|
108
|
|
|
$
|
36
|
|
|
$
|
1,833
|
|
|
$
|
17,729
|
|
|
$
|
19,706
|
|
Net Amount at Risk, net of amounts reinsured
|
$
|
108
|
|
|
$
|
34
|
|
|
$
|
1,280
|
|
|
$
|
17,729
|
|
|
$
|
19,151
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Average attained age of policyholders (in years)
|
51.1
|
|
|
67.6
|
|
|
74.3
|
|
|
69.4
|
|
|
55.0
|
|
|||||
Percentage of policyholders over age 70
|
10.5
|
%
|
|
45.6
|
%
|
|
68.1
|
%
|
|
50.7
|
%
|
|
19.3
|
%
|
|||||
Range of contractually specified interest rates
|
N.A.
|
|
N.A.
|
|
3% - 6%
|
|
|
3% - 6.5%
|
|
3% - 6.5%
|
|
Guarantee Type
|
||||||||||||||||||
|
Return of Premium
|
|
Ratchet
|
|
Roll-Up
|
|
Combo
|
|
Total
|
||||||||||
|
(in millions, except age and interest rate)
|
||||||||||||||||||
Variable annuity contracts with GMIB features
|
|
|
|
|
|
|
|
|
|
||||||||||
Account Values invested in:
|
|
|
|
|
|
|
|
|
|
||||||||||
General Account
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
19
|
|
|
$
|
226
|
|
|
$
|
245
|
|
Separate Accounts
|
—
|
|
|
—
|
|
|
23,572
|
|
|
35,776
|
|
|
59,348
|
|
|||||
Total Account Values
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
23,591
|
|
|
$
|
36,002
|
|
|
$
|
59,593
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Amount at Risk, gross
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
857
|
|
|
$
|
9,344
|
|
|
$
|
10,201
|
|
Net Amount at Risk, net of amounts reinsured
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
270
|
|
|
$
|
8,482
|
|
|
$
|
8,752
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Average attained age of policyholders (in years)
|
N.A.
|
|
N.A.
|
|
68.8
|
|
|
69.5
|
|
|
69.4
|
|
|||||||
Weighted average years remaining until annuitization
|
N.A.
|
|
N.A.
|
|
1.6
|
|
|
0.3
|
|
|
0.4
|
|
|||||||
Range of contractually specified interest rates
|
N.A.
|
|
N.A.
|
|
3% - 6%
|
|
|
3% - 6.5%
|
|
|
3% - 6.5%
|
|
|
Guarantee Type
|
||||||||||||||||||
|
Return of Premium
|
|
Ratchet
|
|
Roll-Up
|
|
Combo
|
|
Total
|
||||||||||
|
(in millions, except age and interest rates)
|
||||||||||||||||||
Variable annuity contracts with GMDB features
|
|
|
|
|
|
|
|
|
|
||||||||||
Reinsured Account Values
|
$
|
931
|
|
|
$
|
5,278
|
|
|
$
|
266
|
|
|
$
|
1,155
|
|
|
$
|
7,630
|
|
Net Amount at Risk assumed
|
$
|
5
|
|
|
$
|
237
|
|
|
$
|
16
|
|
|
$
|
152
|
|
|
$
|
410
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Average attained age of policyholders (in years)
|
68
|
|
|
73
|
|
|
77
|
|
|
75
|
|
|
73
|
|
|||||
Percentage of policyholders over age 70
|
44.8
|
%
|
|
64.3
|
%
|
|
79.8
|
%
|
|
75.2
|
%
|
|
64.1
|
%
|
|||||
Range of contractually specified interest rates (1)
|
N/A
|
|
N/A
|
|
3%-10%
|
|
|
5%-10%
|
|
|
3%-10%
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Variable annuity contracts with GMIB features
|
|
|
|
|
|
|
|
|
|
||||||||||
Reinsured Account Values
|
$
|
900
|
|
|
$
|
44
|
|
|
$
|
239
|
|
|
$
|
1,185
|
|
|
$
|
2,368
|
|
Net Amount at Risk assumed
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
30
|
|
|
$
|
281
|
|
|
$
|
312
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Average attained age of policyholders (in years)
|
72
|
|
|
74
|
|
|
72
|
|
|
69
|
|
|
71
|
|
|||||
Percentage of policyholders over age 70
|
64.1
|
%
|
|
62.1
|
%
|
|
60.9
|
%
|
|
52.8
|
%
|
|
58.1
|
%
|
|||||
Range of contractually specified interest rates
|
N/A
|
|
N/A
|
|
3.3%-6.5%
|
|
|
6%-6%
|
|
|
3.3%-6.5%
|
|
(1)
|
In general, for policies with the highest contractual interest rate shown (10%), the rate applied only for the first 10 years after issue, which has now elapsed.
|
|
December 31,
|
||||||||||||||
|
2019
|
|
2018
|
||||||||||||
Mutual Fund Type
|
GMDB
|
|
GMIB
|
|
GMDB
|
|
GMIB
|
||||||||
|
(in millions)
|
||||||||||||||
Equity
|
$
|
42,489
|
|
|
$
|
17,941
|
|
|
$
|
35,541
|
|
|
$
|
15,759
|
|
Fixed income
|
5,263
|
|
|
2,699
|
|
|
5,173
|
|
|
2,812
|
|
||||
Balanced
|
45,871
|
|
|
38,445
|
|
|
41,588
|
|
|
33,974
|
|
||||
Other
|
865
|
|
|
263
|
|
|
852
|
|
|
290
|
|
||||
Total
|
$
|
94,488
|
|
|
$
|
59,348
|
|
|
$
|
83,154
|
|
|
$
|
52,835
|
|
|
Direct Liability (1)
|
||
|
(in millions)
|
||
Balance at January 1, 2017
|
$
|
1,311
|
|
Paid guarantee benefits
|
(24
|
)
|
|
Other changes in reserves
|
(578
|
)
|
|
Balance at December 31, 2017
|
709
|
|
|
Paid guarantee benefits
|
(23
|
)
|
|
Other changes in reserves
|
126
|
|
|
Balance at December 31, 2018
|
812
|
|
|
Paid guarantee benefits
|
(20
|
)
|
|
Other changes in reserves
|
128
|
|
|
Balance at December 31, 2019
|
$
|
920
|
|
(1)
|
There were no amounts of reinsurance ceded in any period presented.
|
|
Year Ended December 31, 2019
|
||
|
(in millions)
|
||
Operating lease cost
|
$
|
186
|
|
Variable operating lease cost
|
50
|
|
|
Sublease income
|
(72
|
)
|
|
Short-term lease expense
|
2
|
|
|
Net lease cost
|
$
|
166
|
|
|
December 31, 2019
|
||
|
(in millions)
|
||
Operating Leases:
|
|
||
2020
|
$
|
207
|
|
2021
|
198
|
|
|
2022
|
181
|
|
|
2023
|
164
|
|
|
2024
|
102
|
|
|
Thereafter
|
114
|
|
|
Total lease payments
|
966
|
|
|
Less: Interest
|
(83
|
)
|
|
Present value of lease liabilities
|
$
|
883
|
|
|
December 31, 2019
|
|
Weighted-average remaining operating lease term
|
6 years
|
|
Weighted-average discount rate for operating leases
|
3.32
|
%
|
|
Year Ended December 31, 2019
|
||
|
(in millions)
|
||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
||
Operating cash flows from operating leases
|
$
|
222
|
|
Non-cash transactions:
|
|
||
Leased assets obtained in exchange for new operating lease liabilities
|
$
|
50
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
|
|
(in millions)
|
|
|
||||||
Direct premiums
|
$
|
1,068
|
|
|
$
|
1,012
|
|
|
$
|
1,038
|
|
Reinsurance assumed
|
220
|
|
|
214
|
|
|
225
|
|
|||
Reinsurance ceded
|
(141
|
)
|
|
(132
|
)
|
|
(139
|
)
|
|||
Premiums
|
$
|
1,147
|
|
|
$
|
1,094
|
|
|
$
|
1,124
|
|
|
|
|
|
|
|
||||||
Direct charges and fee income
|
$
|
4,157
|
|
|
$
|
4,242
|
|
|
$
|
4,074
|
|
Reinsurance ceded
|
(419
|
)
|
|
(418
|
)
|
|
(381
|
)
|
|||
Policy charges and fee income
|
$
|
3,738
|
|
|
$
|
3,824
|
|
|
$
|
3,693
|
|
|
|
|
|
|
|
||||||
Direct policyholders’ benefits
|
$
|
4,696
|
|
|
$
|
3,269
|
|
|
$
|
4,562
|
|
Reinsurance assumed
|
240
|
|
|
226
|
|
|
461
|
|
|||
Reinsurance ceded
|
(566
|
)
|
|
(580
|
)
|
|
(657
|
)
|
|||
Policyholders’ benefits
|
$
|
4,370
|
|
|
$
|
2,915
|
|
|
$
|
4,366
|
|
|
|
|
|
|
|
||||||
Direct Interest credited to policyholders’ account balances
|
$
|
1,300
|
|
|
$
|
1,140
|
|
|
$
|
1,041
|
|
Reinsurance ceded
|
(59
|
)
|
|
(50
|
)
|
|
(46
|
)
|
|||
Interest credited to policyholders’ account balances
|
$
|
1,241
|
|
|
$
|
1,090
|
|
|
$
|
995
|
|
|
As of December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Short-term debt:
|
|
|
|
||||
AB revolving credit facility
|
$
|
—
|
|
|
$
|
25
|
|
AB commercial paper
|
—
|
|
|
521
|
|
||
Total short-term debt
|
—
|
|
|
546
|
|
|
As of December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Long-term debt:
|
|
|
|
||||
Senior Notes (5.0%, due 2048)
|
1,480
|
|
|
1,480
|
|
||
Senior Notes (4.35%, due 2028)
|
1,487
|
|
|
1,486
|
|
||
Senior Notes (3.9%, due 2023)
|
795
|
|
|
794
|
|
||
Delayed Draw Term Loan (one-month LIBOR + 1.125%, due 2021)
|
—
|
|
|
300
|
|
||
Senior Debentures, 7.0%, due 2028
|
349
|
|
|
349
|
|
||
Total long-term debt
|
4,111
|
|
|
4,409
|
|
||
Total short-term and long-term debt
|
$
|
4,111
|
|
|
$
|
4,955
|
|
•
|
JP Morgan Chase Bank, N.A. ($150 million)
|
•
|
Citibank Europe PLC ($175 million)
|
•
|
Barclays Bank PLC ($150 million)
|
•
|
HSBC Bank USA, National Association ($150 million)
|
•
|
Credit Agricole Corporate and Investment Bank ($400 million)
|
•
|
Landesbank Hessen-Thuringen Girozentrale ($300 million)
|
•
|
Commerzbank AG, New York Branch ($325 million)
|
•
|
Natixis, New York Branch ($250 million)
|
•
|
services AXA or its subsidiaries (other than the Company) receive pursuant to a contract with a third-party service provider, which AXA or its subsidiaries then provide to the Company on a pass-through basis;
|
•
|
services the Company receives pursuant to a contract with a third-party service provider, which the Company then provides to AXA or its subsidiaries (excluding the Company) on a pass-through basis;
|
•
|
certain services the Company receives directly from AXA or its subsidiaries (excluding the Company); and
|
•
|
certain services the Company provides directly to AXA or its subsidiaries (excluding the Company).
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Investment management and services fees
|
$
|
1,276
|
|
|
$
|
1,207
|
|
|
$
|
1,148
|
|
Distribution revenues
|
441
|
|
|
404
|
|
|
398
|
|
|||
Other revenues - shareholder servicing fees
|
75
|
|
|
74
|
|
|
73
|
|
|||
Other revenues - other
|
7
|
|
|
7
|
|
|
7
|
|
|||
Total
|
$
|
1,799
|
|
|
$
|
1,692
|
|
|
$
|
1,626
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Revenue received or accrued for:
|
|
|
|
|
|
||||||
Investment management and administrative services provided to EQAT, VIP Trust, 1290 Funds and Other AXA Trusts
|
$
|
732
|
|
|
$
|
727
|
|
|
$
|
720
|
|
General services provided to AXA Affiliates
|
—
|
|
|
6
|
|
|
27
|
|
|||
Total
|
$
|
732
|
|
|
$
|
733
|
|
|
$
|
747
|
|
|
|
|
|
|
|
||||||
Expenses paid or accrued for:
|
|
|
|
|
|
||||||
General services provided by AXA Affiliates
|
$
|
65
|
|
|
$
|
146
|
|
|
$
|
141
|
|
Investment management services provided by AXA IM, AXA REIM, and AXA Rosenberg
|
5
|
|
|
2
|
|
|
5
|
|
|||
Investment management services provided by AXA Strategic Ventures Corporation (“ASV Corp”)
|
2
|
|
|
2
|
|
|
2
|
|
|||
AXA Guarantees and AXA Credit Facility
|
—
|
|
|
1
|
|
|
9
|
|
|||
Total
|
$
|
72
|
|
|
$
|
151
|
|
|
$
|
157
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
8
|
|
|
$
|
8
|
|
|
$
|
10
|
|
Interest cost
|
104
|
|
|
103
|
|
|
105
|
|
|||
Expected return on assets
|
(152
|
)
|
|
(163
|
)
|
|
(173
|
)
|
|||
Actuarial (gain) loss
|
1
|
|
|
1
|
|
|
1
|
|
|||
Net amortization
|
94
|
|
|
98
|
|
|
126
|
|
|||
Impact of settlement
|
—
|
|
|
109
|
|
|
—
|
|
|||
Net periodic pension expense
|
$
|
55
|
|
|
$
|
156
|
|
|
$
|
69
|
|
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Projected benefit obligation, beginning of year
|
$
|
2,874
|
|
|
$
|
3,455
|
|
Service cost
|
—
|
|
|
—
|
|
||
Interest cost
|
104
|
|
|
103
|
|
||
Actuarial (gains)/losses (1)
|
303
|
|
|
(204
|
)
|
||
Benefits paid
|
(225
|
)
|
|
(190
|
)
|
||
Plan amendments and curtailments
|
—
|
|
|
—
|
|
||
Settlements
|
—
|
|
|
(290
|
)
|
||
Projected benefit obligation, end of year
|
$
|
3,056
|
|
|
$
|
2,874
|
|
(1)
|
Actuarial gains and losses are a product of changes in the discount rate as shown below.
|
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Pension plan assets at fair value, beginning of year
|
$
|
2,341
|
|
|
$
|
2,839
|
|
Actual return on plan assets
|
389
|
|
|
(53
|
)
|
||
Contributions
|
4
|
|
|
5
|
|
||
Benefits paid
|
(183
|
)
|
|
(184
|
)
|
||
Annuity purchases
|
—
|
|
|
(266
|
)
|
||
Pension plan assets at fair value, end of year
|
2,552
|
|
|
2,341
|
|
||
PBO
|
3,056
|
|
|
2,874
|
|
||
Excess of PBO over pension plan assets, end of year
|
$
|
504
|
|
|
$
|
533
|
|
|
As of December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Projected benefit obligation
|
$
|
3,056
|
|
|
$
|
2,874
|
|
Accumulated benefit obligation
|
3,056
|
|
|
2,874
|
|
||
Fair value of plan assets
|
$
|
2,552
|
|
|
$
|
2,341
|
|
|
As of December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Unrecognized net actuarial (gain) loss
|
$
|
976
|
|
|
$
|
1,123
|
|
Unrecognized prior service cost (credit)
|
(1
|
)
|
|
1
|
|
||
Unrecognized net transition obligation (asset)
|
1
|
|
|
—
|
|
||
Total
|
$
|
976
|
|
|
$
|
1,124
|
|
|
As of December 31,
|
||||
|
2019
|
|
2018
|
||
Fixed maturities
|
48.9
|
%
|
|
50.3
|
%
|
Equity securities
|
27.6
|
|
|
22.9
|
|
Equity real estate
|
15.9
|
|
|
17.7
|
|
Cash and short-term investments
|
2.8
|
|
|
3.4
|
|
Other
|
4.8
|
|
|
5.7
|
|
Total
|
100.0
|
%
|
|
100.0
|
%
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
December 31, 2019:
|
|
|
|
|
|
|
|
||||||||
Fixed Maturities:
|
|
|
|
|
|
|
|
||||||||
Corporate
|
$
|
—
|
|
|
$
|
708
|
|
|
$
|
—
|
|
|
$
|
708
|
|
U.S. Treasury, government and agency
|
—
|
|
|
508
|
|
|
—
|
|
|
508
|
|
||||
States and political subdivisions
|
—
|
|
|
24
|
|
|
—
|
|
|
24
|
|
||||
Foreign governments
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
||||
Commercial mortgage-backed
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
||||
Common equity, REITs and preferred equity
|
489
|
|
|
92
|
|
|
—
|
|
|
582
|
|
||||
Mutual funds
|
54
|
|
|
—
|
|
|
—
|
|
|
54
|
|
||||
Collective Trust
|
—
|
|
|
97
|
|
|
—
|
|
|
97
|
|
||||
Cash and cash equivalents
|
23
|
|
|
—
|
|
|
—
|
|
|
23
|
|
||||
Short-term investments
|
—
|
|
|
21
|
|
|
—
|
|
|
21
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
Total assets in the fair value hierarchy
|
567
|
|
|
1,453
|
|
|
1
|
|
|
2,020
|
|
||||
Investments measured at Net Asset Value
|
—
|
|
|
—
|
|
|
—
|
|
|
540
|
|
||||
Investments at fair value
|
$
|
567
|
|
|
$
|
1,453
|
|
|
$
|
1
|
|
|
$
|
2,560
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
||||||||
Fixed Maturities:
|
|
|
|
|
|
|
|
||||||||
Corporate
|
$
|
—
|
|
|
$
|
677
|
|
|
$
|
—
|
|
|
$
|
677
|
|
U.S. Treasury, government and agency
|
—
|
|
|
467
|
|
|
—
|
|
|
467
|
|
||||
States and political subdivisions
|
—
|
|
|
23
|
|
|
—
|
|
|
23
|
|
||||
Foreign governments
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
||||
Commercial mortgage-backed
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
||||
Common and preferred equity
|
424
|
|
|
78
|
|
|
—
|
|
|
502
|
|
||||
Mutual funds
|
53
|
|
|
—
|
|
|
—
|
|
|
53
|
|
||||
Private real estate investment trusts
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||
Cash and cash equivalents
|
34
|
|
|
—
|
|
|
—
|
|
|
34
|
|
||||
Short-term investments
|
—
|
|
|
22
|
|
|
—
|
|
|
22
|
|
||||
Total assets in the fair value hierarchy
|
512
|
|
|
1,269
|
|
|
1
|
|
|
1,782
|
|
||||
Investments measured at Net Asset Value
|
—
|
|
|
—
|
|
|
—
|
|
|
559
|
|
||||
Investments at fair value
|
$
|
512
|
|
|
$
|
1,269
|
|
|
$
|
1
|
|
|
$
|
2,341
|
|
Investment
|
Fair Value
|
|
Redemption Frequency
(If currently eligible)
|
|
Redemption Notice Period
|
|
Unfunded Commitments
|
||||
|
(in millions)
|
||||||||||
December 31, 2019:
|
|
|
|
|
|
|
|
||||
Private Equity Fund
|
$
|
64
|
|
|
N/A (1)(2)
|
|
N/A
|
|
$
|
28
|
|
Private Real Estate Investment Trust
|
396
|
|
|
Quarterly
|
|
One Quarter
|
|
—
|
|
||
Hedge Fund
|
80
|
|
|
Calendar Quarters (3)
|
|
Previous Quarter End
|
|
$
|
3
|
|
|
Total (4)
|
$
|
540
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
||||
December 31, 2018:
|
|
|
|
|
|
|
|
||||
Private Equity Fund
|
$
|
64
|
|
|
N/A (1)(2)
|
|
N/A
|
|
$
|
33
|
|
Private Real Estate Investment Trust
|
402
|
|
|
Quarterly
|
|
One Quarter
|
|
—
|
|
||
Hedge Fund
|
93
|
|
|
Calendar Quarters (3)
|
|
Previous Quarter End
|
|
$
|
12
|
|
|
Total (4)
|
$
|
559
|
|
|
|
|
|
|
|
(1)
|
Cannot sell or transfer ownership interest without prior written consent to transfer, and by meeting several criteria (e.g., does not adversely affect other investors).
|
(2)
|
Cannot sell interest in the vehicle without prior written consent of the managing member.
|
(3)
|
March, June, September and December.
|
(4)
|
Includes Equity method investments of $115 million and $128 million at December 31, 2019 and 2018, respectively.
|
|
|
Fixed Maturities — Commercial Mortgage-Backed
|
||
|
(in millions)
|
|||
Balance, January 1, 2019
|
|
$
|
2
|
|
Actual return on plan assets — Sales/Settlements
|
|
(1
|
)
|
|
Balance, December 31, 2019
|
|
$
|
1
|
|
|
|
|
||
Balance, January 1, 2018
|
|
$
|
3
|
|
Actual return on plan assets — Sales/Settlements
|
|
(1
|
)
|
|
Balance, December 31, 2018
|
|
$
|
2
|
|
|
|
|
||
Balance, January 1, 2017
|
|
$
|
5
|
|
Actual return on plan assets — Sales/Settlements
|
|
(2
|
)
|
|
Balance, December 31, 2017
|
|
$
|
3
|
|
|
As of December 31,
|
||
|
2019
|
|
2018
|
Discount rates:
|
|
|
|
AXA Equitable Life QP
|
2.98%
|
|
4.07%
|
AXA Equitable Excess Retirement Plan
|
2.9%
|
|
4.01%
|
MONY Life Retirement Income Security Plan for Employees
|
3.19%
|
|
4.2%
|
AB Qualified Retirement Plan
|
4.4%
|
|
3.9%
|
Other defined benefit plans
|
2.58% — 3.07%
|
|
3.75% — 4.10%
|
Periodic cost
|
3.75% — 4.20%
|
|
3.00% — 3.50%
|
Cash balance interest crediting rate for pre-April 1, 2012 accruals
|
4.00%
|
|
4.00%
|
Cash balance interest crediting rate for post-April 1, 2012 accruals
|
2.50%
|
|
2.50%
|
|
|
|
|
Rates of compensation increase:
|
|
|
|
Benefit obligation
|
5.98%
|
|
5.99%
|
Periodic cost
|
6.38%
|
|
6.34%
|
|
|
|
|
Expected long-term rates of return on pension plan assets (periodic cost)
|
6.75%
|
|
6.75%
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
2
|
|
Interest cost
|
18
|
|
|
16
|
|
|
16
|
|
|||
Net amortization
|
6
|
|
|
9
|
|
|
6
|
|
|||
Net Periodic Post-Retirement Benefits Costs
|
$
|
25
|
|
|
$
|
27
|
|
|
$
|
24
|
|
|
December 31,
|
|
|
||||||
|
2019
|
|
2018
|
|
|
||||
|
(in millions)
|
|
|
||||||
Accumulated post-retirement benefits obligation, beginning of year
|
$
|
483
|
|
|
$
|
529
|
|
|
(1)
|
Service cost
|
1
|
|
|
2
|
|
|
|
||
Interest cost
|
18
|
|
|
16
|
|
|
|
||
Contributions and benefits paid
|
(34
|
)
|
|
(46
|
)
|
|
|
||
Actuarial (gains) losses
|
49
|
|
|
(18
|
)
|
|
|
||
Accumulated post-retirement benefits obligation, end of year
|
$
|
517
|
|
|
$
|
483
|
|
|
|
|
December 31,
|
||
|
2019
|
|
2018
|
Following year
|
6.1%
|
|
10.2%
|
Ultimate rate to which cost increase is assumed to decline
|
4.0%
|
|
4.3%
|
Year in which the ultimate trend rate is reached
|
2092
|
|
2099
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Unrecognized net actuarial (gains) losses
|
$
|
158
|
|
|
$
|
116
|
|
Unrecognized prior service (credit)
|
—
|
|
|
—
|
|
||
Total
|
$
|
158
|
|
|
$
|
116
|
|
|
December 31,
|
||
|
2019
|
|
2018
|
Discount rates:
|
|
|
|
Benefit obligation
|
2.29% — 3.16%
|
|
3.52% — 3.89%
|
Periodic cost
|
3.53% — 4.17%
|
|
3.00% — 3.50%
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
2
|
|
Interest cost
|
—
|
|
|
—
|
|
|
—
|
|
|||
Net amortization
|
—
|
|
|
(1
|
)
|
|
(2
|
)
|
|||
Net (gain) loss
|
(1
|
)
|
|
—
|
|
|
—
|
|
|||
Net periodic post-employment benefits costs
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Performance Shares
|
$
|
29
|
|
|
$
|
11
|
|
|
$
|
45
|
|
Stock Options
|
4
|
|
|
2
|
|
|
1
|
|
|||
AXA Shareplan
|
—
|
|
|
—
|
|
|
13
|
|
|||
Restricted Stock Units
|
243
|
|
|
215
|
|
|
185
|
|
|||
Other Compensation Plans (1)
|
—
|
|
|
—
|
|
|
3
|
|
|||
Total Compensation Expenses
|
$
|
276
|
|
|
$
|
228
|
|
|
$
|
247
|
|
|
Options Outstanding
|
||||||||||||||||||||||||||
|
EQH Shares
|
|
AB Holding Units
|
|
AXA Ordinary Shares
|
|
AXA ADRs (2)
|
||||||||||||||||||||
|
Number
Outstanding
(in 000’s)
|
|
Weighted
Average
Exercise
Price
|
|
Number
Outstanding
(In 000’s)
|
|
Weighted
Average
Exercise
Price
|
|
Number
Outstanding (in 000’s) |
|
Weighted
Average Exercise Price |
|
Number
Outstanding (in 000’s) |
|
Weighted
Average Exercise Price |
||||||||||||
Options Outstanding at January 1, 2019
|
994
|
|
|
$
|
21.34
|
|
|
671
|
|
|
$
|
22.83
|
|
|
3,613
|
|
|
€
|
18.20
|
|
|
25
|
|
|
$
|
15.37
|
|
Options granted
|
1,510
|
|
|
$
|
18.74
|
|
|
—
|
|
|
$
|
—
|
|
|
186
|
|
|
€
|
21.46
|
|
|
—
|
|
|
$
|
—
|
|
Options exercised
|
(27
|
)
|
|
$
|
21.34
|
|
|
(512
|
)
|
|
$
|
22.49
|
|
|
(1,322
|
)
|
|
€
|
16.10
|
|
|
(25
|
)
|
|
$
|
15.37
|
|
Options forfeited, net
|
(159
|
)
|
|
$
|
20.28
|
|
|
—
|
|
|
$
|
—
|
|
|
(243
|
)
|
|
€
|
18.99
|
|
|
—
|
|
|
$
|
—
|
|
Options expired
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
€
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Options Outstanding at December 31, 2019
|
2,318
|
|
|
$
|
19.72
|
|
|
159
|
|
|
$
|
23.93
|
|
|
2,233
|
|
|
€
|
19.63
|
|
|
—
|
|
|
$
|
—
|
|
Aggregate Intrinsic
Value (1) |
|
|
$
|
11,731
|
|
|
|
|
$
|
1,009
|
|
|
|
|
€
|
12,239
|
|
|
|
|
$
|
—
|
|
||||
Weighted Average Remaining Contractual Term (in years)
|
8.86
|
|
|
|
|
2.14
|
|
|
|
|
4.88
|
|
|
|
|
—
|
|
|
|
||||||||
Options Exercisable at December 31, 2019
|
298
|
|
|
$
|
21.34
|
|
|
141
|
|
|
$
|
24.09
|
|
|
1,995
|
|
|
€
|
19.24
|
|
|
—
|
|
|
$
|
—
|
|
Aggregate Intrinsic
Value (1) |
|
|
$
|
1,023
|
|
|
|
|
$
|
870
|
|
|
|
|
€
|
11,702
|
|
|
|
|
$
|
—
|
|
||||
Weighted Average Remaining Contractual Term (in years)
|
8.43
|
|
|
|
|
2.11
|
|
|
|
|
4.52
|
|
|
|
|
—
|
|
|
|
|
EQH Shares (1)
|
|
AXA Ordinary Shares (2)
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2017
|
||||||
Dividend yield
|
2.77
|
%
|
|
2.44
|
%
|
|
N.A.
|
|
N.A.
|
|
6.53
|
%
|
|||
Expected volatility
|
25.70
|
%
|
|
25.40
|
%
|
|
N.A.
|
|
N.A.
|
|
25.05
|
%
|
|||
Risk-free interest rates
|
2.49
|
%
|
|
2.83
|
%
|
|
N.A.
|
|
N.A.
|
|
0.59
|
%
|
|||
Expected life in years
|
5.8
|
|
|
9.7
|
|
|
N.A.
|
|
N.A.
|
|
8.8
|
|
|||
Weighted average fair value per option at grant date
|
$
|
3.82
|
|
|
$
|
4.61
|
|
|
N.A.
|
|
N.A.
|
|
$
|
2.01
|
|
|
Shares of Holdings Restricted Stock Units
|
|
Weighted-Average Grant Date
Fair Value
|
|
Shares of AXA Restricted Stock Units
|
|
Weighted-Average Grant Date
Fair Value
|
||||||
Unvested as of January 1, 2019
|
2,272,910
|
|
|
$
|
21.00
|
|
|
53,984
|
|
|
$
|
20.38
|
|
Granted
|
1,982,820
|
|
|
$
|
18.43
|
|
|
—
|
|
|
$
|
—
|
|
Forfeited
|
184,958
|
|
|
$
|
19.84
|
|
|
—
|
|
|
$
|
—
|
|
Vested
|
660,591
|
|
|
$
|
21.01
|
|
|
31,879
|
|
|
$
|
21.17
|
|
Unvested as of December 31, 2019
|
3,410,181
|
|
|
$
|
19.57
|
|
|
22,105
|
|
|
$
|
19.23
|
|
|
Shares of Holdings Performance Awards
|
|
Weighted-Average Grant Date
Fair Value |
|
Shares of AXA Performance Awards
|
|
Weighted-Average Grant Date
Fair Value |
||||||
Unvested as of January 1, 2019
|
197,763
|
|
|
$
|
23.17
|
|
|
6,738,653
|
|
|
$
|
21.10
|
|
Granted
|
293,237
|
|
|
$
|
19.67
|
|
|
207,136
|
|
|
$
|
20.62
|
|
Forfeited
|
31,014
|
|
|
$
|
21.76
|
|
|
345,735
|
|
|
$
|
20.45
|
|
Vested
|
—
|
|
|
$
|
—
|
|
|
2,066,118
|
|
|
$
|
21.85
|
|
Unvested as of December 31, 2019
|
459,986
|
|
|
$
|
21.03
|
|
|
4,533,936
|
|
|
$
|
20.79
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Income tax (expense) benefit:
|
|
|
|
|
|
||||||
Current (expense) benefit
|
$
|
(71
|
)
|
|
$
|
508
|
|
|
$
|
119
|
|
Deferred (expense) benefit
|
670
|
|
|
(815
|
)
|
|
(168
|
)
|
|||
Total
|
$
|
599
|
|
|
$
|
(307
|
)
|
|
$
|
(49
|
)
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Expected income tax (expense) benefit
|
$
|
427
|
|
|
$
|
(516
|
)
|
|
$
|
(457
|
)
|
Noncontrolling interest
|
51
|
|
|
54
|
|
|
138
|
|
|||
Non-taxable investment income
|
74
|
|
|
105
|
|
|
255
|
|
|||
Tax audit interest
|
(24
|
)
|
|
(22
|
)
|
|
(14
|
)
|
|||
State income taxes
|
(21
|
)
|
|
(18
|
)
|
|
(16
|
)
|
|||
Tax settlements/uncertain tax position release
|
75
|
|
|
—
|
|
|
228
|
|
|||
Change in tax law
|
—
|
|
|
104
|
|
|
(32
|
)
|
|||
Intangibles
|
(3
|
)
|
|
(3
|
)
|
|
(138
|
)
|
|||
Other
|
20
|
|
|
(11
|
)
|
|
(13
|
)
|
|||
Income tax (expense) benefit
|
$
|
599
|
|
|
$
|
(307
|
)
|
|
$
|
(49
|
)
|
|
As of December 31,
|
||||||||||||||
|
2019
|
|
2018
|
||||||||||||
|
Assets
|
|
Liabilities
|
|
Assets
|
|
Liabilities
|
||||||||
|
(in millions)
|
||||||||||||||
Compensation and related benefits
|
$
|
283
|
|
|
$
|
—
|
|
|
$
|
312
|
|
|
$
|
—
|
|
Net operating loss
|
56
|
|
|
—
|
|
|
90
|
|
|
—
|
|
||||
Reserves and reinsurance
|
1,228
|
|
|
—
|
|
|
366
|
|
|
—
|
|
||||
DAC
|
—
|
|
|
984
|
|
|
—
|
|
|
1,175
|
|
||||
Unrealized investment gains/losses
|
—
|
|
|
717
|
|
|
108
|
|
|
—
|
|
||||
Investments
|
46
|
|
|
—
|
|
|
—
|
|
|
21
|
|
||||
Tax credits
|
—
|
|
|
—
|
|
|
149
|
|
|
—
|
|
||||
Other
|
—
|
|
|
111
|
|
|
—
|
|
|
108
|
|
||||
Total
|
$
|
1,613
|
|
|
$
|
1,812
|
|
|
$
|
1,025
|
|
|
$
|
1,304
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Balance at January 1,
|
$
|
539
|
|
|
$
|
477
|
|
|
$
|
729
|
|
Additions for tax positions of prior years
|
25
|
|
|
91
|
|
|
28
|
|
|||
Reductions for tax positions of prior years
|
(63
|
)
|
|
(29
|
)
|
|
(247
|
)
|
|||
Additions for tax positions of current year
|
—
|
|
|
—
|
|
|
—
|
|
|||
Settlements with tax authorities
|
—
|
|
|
—
|
|
|
(33
|
)
|
|||
Balance at December 31,
|
$
|
501
|
|
|
$
|
539
|
|
|
$
|
477
|
|
|
|
|
|
|
|
||||||
Unrecognized tax benefits that, if recognized, would impact the effective rate
|
$
|
369
|
|
|
$
|
407
|
|
|
$
|
317
|
|
|
Calendar Year
|
||||||||||||||||||
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024 and thereafter
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Long-term debt
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
800
|
|
|
$
|
3,350
|
|
|
Outstanding Balance at December 31, 2018
|
|
Issued During the Period
|
|
Repaid During the Period
|
|
Long-term Agreements Maturing Within One Year
|
|
Outstanding Balance at December 31, 2019
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Short-term funding agreements:
|
|
|
|
|
|
|
|
|
|
||||||||||
Due in one year or less
|
$
|
1,640
|
|
|
$
|
29,330
|
|
|
$
|
26,420
|
|
|
$
|
58
|
|
|
$
|
4,608
|
|
Long-term funding agreements:
|
|
|
|
|
|
|
|
|
|
||||||||||
Due in years two through five
|
1,569
|
|
|
—
|
|
|
—
|
|
|
77
|
|
|
1,646
|
|
|||||
Due in more than five years
|
781
|
|
|
—
|
|
|
—
|
|
|
(135
|
)
|
|
646
|
|
|||||
Total long-term funding agreements
|
2,350
|
|
|
—
|
|
|
—
|
|
|
(58
|
)
|
|
2,292
|
|
|||||
Total funding agreements (1)
|
$
|
3,990
|
|
|
$
|
29,330
|
|
|
$
|
26,420
|
|
|
$
|
—
|
|
|
$
|
6,900
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Outstanding Balance at December 31, 2017
|
|
Issued During the Period
|
|
Repaid During the Period
|
|
Long-term Agreements Maturing Within One Year
|
|
Outstanding Balance at December 31, 2018
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Short-term funding agreements:
|
|
|
|
|
|
|
|
|
|
||||||||||
Due in one year or less
|
$
|
500
|
|
|
$
|
7,980
|
|
|
$
|
(6,990
|
)
|
|
$
|
150
|
|
|
$
|
1,640
|
|
Long-term funding agreements:
|
|
|
|
|
|
|
|
|
|
||||||||||
Due in years two through five
|
1,621
|
|
|
—
|
|
|
—
|
|
|
(52
|
)
|
|
1,569
|
|
|||||
Due in more than five years
|
879
|
|
|
—
|
|
|
—
|
|
|
(98
|
)
|
|
781
|
|
|||||
Total long-term funding agreements
|
2,500
|
|
|
—
|
|
|
—
|
|
|
(150
|
)
|
|
2,350
|
|
|||||
Total funding agreements (1)
|
$
|
3,000
|
|
|
$
|
7,980
|
|
|
$
|
(6,990
|
)
|
|
$
|
—
|
|
|
$
|
3,990
|
|
(1)
|
The $9 million, $11 million and $14 million difference between the funding agreements carrying value shown in fair value table for 2019, 2018 and 2017, respectively, reflects the remaining amortization of a hedge implemented and closed, which locked in the funding agreements borrowing rates.
|
•
|
The Individual Retirement segment offers a diverse suite of variable annuity products which are primarily sold to affluent and high net worth individuals saving for retirement or seeking retirement income.
|
•
|
The Group Retirement segment offers tax-deferred investment and retirement services or products to plans sponsored by educational entities, municipalities and not-for-profit entities, as well as small and medium-sized businesses.
|
•
|
The Investment Management and Research segment provides diversified investment management, research and related solutions globally to a broad range of clients through three main client channels- Institutional, Retail and Private Wealth Management-and distributes its institutional research products and solutions through Bernstein Research Services.
|
•
|
The Protection Solutions segment includes our life insurance and group employee benefits businesses. Our life insurance business offers a variety of variable universal life, universal life and term life products to help affluent and high net worth individuals, as well as small and medium-sized business owners, with their wealth protection, wealth transfer and corporate needs. Our group employee benefits business offers a suite of dental, vision, life, and short- and long-term disability and other insurance products to small and medium-size businesses across the United States.
|
•
|
Items related to variable annuity product features, which include certain changes in the fair value of the derivatives and other securities we use to hedge these features, the effect of benefit ratio unlock adjustments and changes in the fair value of the embedded derivatives reflected within variable annuity products’ net derivative results and the impact of these items on DAC amortization on our SCS product;
|
•
|
Investment (gains) losses, which includes other-than-temporary impairments of securities, sales or disposals of securities/investments, realized capital gains/losses and valuation allowances;
|
•
|
Goodwill impairment, which includes a write-down of goodwill in 2017.
|
•
|
Net actuarial (gains) losses, which includes actuarial gains and losses as a result of differences between actual and expected experience on pension plan assets or projected benefit obligation during a given period related
|
•
|
Other adjustments, which includes restructuring costs related to severance, lease write-offs related to non-recurring restructuring activities, and separation costs; and
|
•
|
Income tax expense (benefit) related to the above items and non-recurring tax items, which includes the effect of uncertain tax positions for a given audit period, permanent differences due to goodwill impairment and the Tax Reform Act.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Net income (loss) attributable to Holdings
|
$
|
(1,733
|
)
|
|
$
|
1,820
|
|
|
$
|
834
|
|
Adjustments related to:
|
|
|
|
|
|
||||||
Variable annuity product features (1)
|
4,878
|
|
|
(70
|
)
|
|
1,107
|
|
|||
Investment (gains) losses
|
(73
|
)
|
|
86
|
|
|
191
|
|
|||
Goodwill impairment
|
—
|
|
|
—
|
|
|
369
|
|
|||
Net actuarial (gains) losses related to pension and other postretirement benefit obligations
|
99
|
|
|
215
|
|
|
135
|
|
|||
Other adjustments (2)
|
406
|
|
|
299
|
|
|
119
|
|
|||
Income tax expense (benefit) related to above adjustments (3)
|
(1,114
|
)
|
|
(111
|
)
|
|
(644
|
)
|
|||
Non-recurring tax items
|
(66
|
)
|
|
(73
|
)
|
|
(76
|
)
|
|||
Non-GAAP Operating Earnings (4)
|
$
|
2,397
|
|
|
$
|
2,166
|
|
|
$
|
2,035
|
|
Operating earnings (loss) by segment:
|
|
|
|
|
|
||||||
|
|
|
|
|
|
||||||
Individual Retirement (5)
|
$
|
1,577
|
|
|
$
|
1,555
|
|
|
$
|
1,252
|
|
Group Retirement
|
$
|
390
|
|
|
$
|
389
|
|
|
$
|
283
|
|
Investment Management and Research
|
$
|
381
|
|
|
$
|
381
|
|
|
$
|
211
|
|
Protection Solutions
|
$
|
396
|
|
|
$
|
197
|
|
|
$
|
502
|
|
Corporate and Other (6)
|
$
|
(347
|
)
|
|
$
|
(356
|
)
|
|
$
|
(213
|
)
|
(1)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, the adjustment related to Variable annuity product features for the years ended 2018 and 2017 would have been ($126) million and $1.1 billion.
|
(2)
|
Other adjustments include separation costs of $222 million, $213 million and $93 million in 2019, 2018 and 2017, respectively.
|
(3)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, the adjustment related to Income tax expense (benefit) related to above adjustments for the years ended 2018 and 2017 would have been ($99) million and ($634) million.
|
(4)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Operating earnings for the years ended 2018 and 2017 would have been $2.1 billion and $2.0 billion.
|
(5)
|
Had we modified the treatment of the amortization of DAC for SCS starting in 2017, Operating earnings for the years ended 2018 and 2017 for the Individual Retirement segment would have been $1.5 billion and $1.2 billion.
|
(6)
|
Includes interest expense and financing fees of $228 million, $223 million and $138 million, in 2019, 2018 and 2017, respectively.
|
•
|
Items related to variable annuity product features, which include certain changes in the fair value of the derivatives and other securities we use to hedge these features and changes in the fair value of the embedded derivatives reflected within the net derivative results of variable annuity product features;
|
•
|
Investment gains (losses), net, which include other-than-temporary impairments of securities, sales or disposals of securities/investments, realized capital gains/losses, and valuation allowances; and
|
•
|
Other adjustments, which includes investment income (loss) from certain derivative instruments, excluding derivative instruments used to hedge risks associated with interest margins on interest sensitive life and annuity contracts and freestanding and embedded derivatives associated with products with GMxB features.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Segment revenues:
|
|
|
|
|
|
||||||
Individual Retirement (1)
|
$
|
4,340
|
|
|
$
|
4,054
|
|
|
$
|
4,374
|
|
Group Retirement (1)
|
1,077
|
|
|
1,019
|
|
|
942
|
|
|||
Investment Management and Research (2)
|
3,479
|
|
|
3,411
|
|
|
3,216
|
|
|||
Protection Solutions (1)
|
3,325
|
|
|
3,232
|
|
|
3,057
|
|
|||
Corporate and Other (1)
|
1,229
|
|
|
1,148
|
|
|
1,212
|
|
|||
Adjustments related to:
|
|
|
|
|
|
||||||
Variable annuity product features
|
(3,939
|
)
|
|
(643
|
)
|
|
(214
|
)
|
|||
Investment gains (losses), net
|
73
|
|
|
(86
|
)
|
|
(191
|
)
|
|||
Other adjustments to segment revenues
|
7
|
|
|
(57
|
)
|
|
64
|
|
|||
Total revenues
|
$
|
9,591
|
|
|
$
|
12,078
|
|
|
$
|
12,460
|
|
(1)
|
Includes investment expenses charged by AB of $76 million, $67 million and $68 million for 2019, 2018 and 2017, respectively, for services provided to the Company.
|
(2)
|
Inter-segment investment management and other fees of $104 million, $94 million and $96 million for 2019, 2018 and 2017, respectively, are included in segment revenues of the Investment Management and Research segment.
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Total assets by segment:
|
|
|
|
||||
Individual Retirement
|
$
|
123,626
|
|
|
$
|
105,532
|
|
Group Retirement
|
43,588
|
|
|
38,874
|
|
||
Investment Management and Research
|
10,170
|
|
|
10,294
|
|
||
Protection Solutions
|
46,886
|
|
|
44,633
|
|
||
Corporate and Other
|
25,600
|
|
|
21,464
|
|
||
Total assets
|
$
|
249,870
|
|
|
$
|
220,797
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Dividends declared per share of common stock
|
$
|
0.58
|
|
|
$
|
0.26
|
|
|
$
|
—
|
|
|
December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Unrealized gains (losses) on investments (1) (2) (4)
|
$
|
1,838
|
|
|
$
|
(404
|
)
|
|
$
|
825
|
|
Defined benefit pension plans (3)
|
(983
|
)
|
|
(968
|
)
|
|
(955
|
)
|
|||
Foreign currency translation adjustments (1)
|
(57
|
)
|
|
(62
|
)
|
|
(30
|
)
|
|||
Total accumulated other comprehensive income (loss)
|
798
|
|
|
(1,434
|
)
|
|
(160
|
)
|
|||
Less: Accumulated other comprehensive income (loss) attributable to noncontrolling interest
|
(42
|
)
|
|
(38
|
)
|
|
(52
|
)
|
|||
Accumulated other comprehensive income (loss) attributable to Holdings
|
$
|
840
|
|
|
$
|
(1,396
|
)
|
|
$
|
(108
|
)
|
(1)
|
A reclassification of $10 million and $5 million, respectively has been made to the December 31, 2018 and 2017 previously reported balances to conform to the current period’s presentation.
|
(2)
|
2018 includes a $113 million decrease to Accumulated other comprehensive loss from the impact of adoption of ASU 2018-02.
|
(3)
|
2018 includes a $202 million increase to Accumulated other comprehensive loss from the impact of adoption of ASU 2018-02.
|
(4)
|
2018 includes a $7 million decrease to Accumulated other comprehensive loss from the impact of adoption of ASU 2016-01.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Change in net unrealized gains (losses) on investments:
|
|
|
|
|
|
||||||
Net unrealized gains (losses) arising during the period
|
$
|
3,301
|
|
|
$
|
(1,952
|
)
|
|
$
|
910
|
|
(Gains) losses reclassified to Net income (loss) during the period (1)
|
(161
|
)
|
|
60
|
|
|
10
|
|
|||
Net unrealized gains (losses) on investments
|
3,140
|
|
|
(1,892
|
)
|
|
920
|
|
|||
Adjustments for policyholders’ liabilities, DAC, insurance liability loss recognition and other (2)
|
(898
|
)
|
|
558
|
|
|
(227
|
)
|
|||
Change in unrealized gains (losses), net of adjustments (net of deferred income tax expense (benefit) of $590, $(356) and $262)
|
2,242
|
|
|
(1,334
|
)
|
|
693
|
|
|||
Change in defined benefit plans:
|
|
|
|
|
|
||||||
Reclassification to Net income (loss) of amortization of net prior service credit included in net periodic cost (3)
|
(15
|
)
|
|
189
|
|
|
100
|
|
|||
Change in defined benefit plans (net of deferred income tax expense (benefit) of $10, $50 and $51)
|
(15
|
)
|
|
189
|
|
|
100
|
|
|||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||||
Foreign currency translation gains (losses) arising during the period (2)
|
5
|
|
|
(32
|
)
|
|
39
|
|
|||
(Gains) losses reclassified into net income (loss) during the period
|
—
|
|
|
—
|
|
|
—
|
|
|||
Foreign currency translation adjustment
|
5
|
|
|
(32
|
)
|
|
39
|
|
|||
|
|
|
|
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Total other comprehensive income (loss), net of income taxes
|
2,232
|
|
|
(1,177
|
)
|
|
832
|
|
|||
Less: Other comprehensive income (loss) attributable to noncontrolling interest
|
(4
|
)
|
|
15
|
|
|
19
|
|
|||
Other comprehensive income (loss) attributable to Holdings
|
$
|
2,236
|
|
|
$
|
(1,192
|
)
|
|
$
|
813
|
|
(1)
|
See “Reclassification adjustments” in Note 3. Reclassification amounts presented net of income tax expense (benefit) of $(43) million, $13 million and $5 million for the years December 31, 2019, 2018 and 2017, respectively.
|
(2)
|
A reclassification of $5 million and $3 million has been made to the previously reported amounts for the years ended December 31, 2018 and 2017, respectively to conform to the current period’s presentation.
|
(3)
|
These AOCI components are included in the computation of net periodic costs (see “Employee Benefit Plans” in Note 14).
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
||||||
Weighted-average common shares outstanding — basic
|
493.6
|
|
|
556.4
|
|
|
561.0
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
||||||
Employee share awards (1)
|
—
|
|
|
0.1
|
|
|
—
|
|
|||
Weighted-average common shares outstanding — diluted (2)
|
493.6
|
|
|
556.5
|
|
|
561.0
|
|
|||
|
|
|
|
|
|
||||||
Net income (loss):
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(1,436
|
)
|
|
$
|
2,154
|
|
|
$
|
1,257
|
|
Less: Net income (loss) attributable to the noncontrolling interest
|
297
|
|
|
334
|
|
|
423
|
|
|||
Net income (loss) attributable to Holdings common shareholders
|
(1,733
|
)
|
|
1,820
|
|
|
834
|
|
|||
Less: Incremental dilution from AB (3)
|
—
|
|
|
—
|
|
|
1
|
|
|||
Net income (loss) attributable to Holdings common shareholders (diluted)
|
$
|
(1,733
|
)
|
|
$
|
1,820
|
|
|
$
|
833
|
|
|
|
|
|
|
|
||||||
Earnings per common share:
|
|
|
|
|
|
||||||
Basic
|
$
|
(3.51
|
)
|
|
$
|
3.27
|
|
|
$
|
1.49
|
|
Diluted
|
$
|
(3.51
|
)
|
|
$
|
3.27
|
|
|
$
|
1.49
|
|
(1)
|
Calculated using the treasury stock method.
|
(2)
|
Shares in the diluted EPS calculation represent basic shares for the year ended 2019 due to the net loss in this period. The shares excluded from the calculation were 1.1 million.
|
(3)
|
The incremental dilution from AB represents the impact of AB’s dilutive units on the Company’s diluted earnings per share and is calculated based on the Company’s proportionate ownership interest in AB.
|
|
Three Months Ended
|
||||||||||||||
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
|
(in millions)
|
||||||||||||||
2019
|
|
|
|
|
|
|
|
||||||||
Total revenues
|
$
|
1,714
|
|
|
$
|
3,160
|
|
|
$
|
3,028
|
|
|
$
|
1,689
|
|
Total benefits and other deductions
|
2,638
|
|
|
2,719
|
|
|
3,468
|
|
|
2,801
|
|
||||
Income (loss) from continuing operations, before income taxes
|
(924
|
)
|
|
441
|
|
|
(440
|
)
|
|
(1,112
|
)
|
||||
Income tax (expense) benefit
|
215
|
|
|
(11
|
)
|
|
124
|
|
|
271
|
|
||||
Net income (loss)
|
(709
|
)
|
|
430
|
|
|
(316
|
)
|
|
(841
|
)
|
||||
Less: Net income (loss) attributable to the noncontrolling interest
|
66
|
|
|
67
|
|
|
68
|
|
|
96
|
|
||||
Net income (loss) attributable to Holdings
|
$
|
(775
|
)
|
|
$
|
363
|
|
|
$
|
(384
|
)
|
|
$
|
(937
|
)
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share - Common stock:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(1.50
|
)
|
|
$
|
0.74
|
|
|
$
|
(0.78
|
)
|
|
$
|
(1.97
|
)
|
Diluted
|
$
|
(1.50
|
)
|
|
$
|
0.74
|
|
|
$
|
(0.78
|
)
|
|
$
|
(1.97
|
)
|
|
Three Months Ended
|
||||||||||||||
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
|
(in millions)
|
||||||||||||||
2018
|
|
|
|
|
|
|
|
||||||||
Total revenues
|
$
|
2,874
|
|
|
$
|
2,966
|
|
|
$
|
1,083
|
|
|
$
|
5,155
|
|
Total benefits and other deductions
|
2,446
|
|
|
2,644
|
|
|
1,701
|
|
|
2,826
|
|
||||
Income (loss) from continuing operations, before income taxes
|
428
|
|
|
322
|
|
|
(618
|
)
|
|
2,329
|
|
||||
Income tax (expense) benefit
|
(91
|
)
|
|
(61
|
)
|
|
175
|
|
|
(330
|
)
|
||||
Net income (loss)
|
337
|
|
|
261
|
|
|
(443
|
)
|
|
1,999
|
|
||||
Less: Net income (loss) attributable to the noncontrolling interest
|
123
|
|
|
97
|
|
|
53
|
|
|
61
|
|
||||
Net income (loss) attributable to Holdings
|
$
|
214
|
|
|
$
|
164
|
|
|
$
|
(496
|
)
|
|
$
|
1,938
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share - Common stock:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.38
|
|
|
$
|
0.29
|
|
|
$
|
(0.89
|
)
|
|
$
|
3.57
|
|
Diluted
|
$
|
0.38
|
|
|
$
|
0.29
|
|
|
$
|
(0.89
|
)
|
|
$
|
3.57
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Balance, beginning of year
|
$
|
187
|
|
|
$
|
626
|
|
|
$
|
403
|
|
Net earnings (loss) attributable to redeemable noncontrolling interests
|
34
|
|
|
18
|
|
|
53
|
|
|||
Purchase/change of redeemable noncontrolling interests
|
144
|
|
|
(457
|
)
|
|
170
|
|
|||
Balance, end of year
|
$
|
365
|
|
|
$
|
187
|
|
|
$
|
626
|
|
|
December 31, 2019
|
||
|
(in millions)
|
||
Assets:
|
|
||
Fixed maturity securities
|
$
|
896
|
|
Trading securities, at fair value
|
17
|
|
|
Policy loans
|
19
|
|
|
Cash and cash equivalents
|
65
|
|
|
Amounts due from reinsurers
|
43
|
|
|
Deferred policy acquisition costs
|
31
|
|
|
Other assets
|
24
|
|
|
Assets held-for-sale
|
1,095
|
|
|
Less: Loss accrual
|
(133
|
)
|
|
Total assets held-for-sale
|
$
|
962
|
|
|
|
||
Liabilities:
|
|
||
Policyholders’ account balances
|
$
|
286
|
|
Future policy benefits and other policyholders’ liabilities
|
421
|
|
|
Amounts due to reinsurers
|
6
|
|
|
Other liabilities
|
11
|
|
|
Total liabilities held-for-sale
|
$
|
724
|
|
|
Cost (2)
|
|
Fair Value
|
|
Carrying
Value
|
||||||
|
(in millions)
|
||||||||||
Fixed Maturities:
|
|
|
|
|
|
||||||
U.S. government, agencies and authorities
|
$
|
14,410
|
|
|
$
|
15,394
|
|
|
$
|
14,410
|
|
State, municipalities and political subdivisions
|
638
|
|
|
705
|
|
|
638
|
|
|||
Foreign governments
|
462
|
|
|
492
|
|
|
462
|
|
|||
Public utilities
|
5,010
|
|
|
5,305
|
|
|
5,010
|
|
|||
All other corporate bonds
|
40,890
|
|
|
42,894
|
|
|
40,890
|
|
|||
Residential mortgage-backed
|
178
|
|
|
191
|
|
|
178
|
|
|||
Asset-backed
|
848
|
|
|
849
|
|
|
848
|
|
|||
Redeemable preferred stocks
|
501
|
|
|
513
|
|
|
501
|
|
|||
Total fixed maturities
|
62,937
|
|
|
66,343
|
|
|
62,937
|
|
|||
Mortgage loans on real estate (3)
|
12,107
|
|
|
12,334
|
|
|
12,107
|
|
|||
Real estate held for the production of income
|
27
|
|
|
27
|
|
|
27
|
|
|||
Policy loans
|
3,735
|
|
|
4,707
|
|
|
3,735
|
|
|||
Other equity investments
|
1,350
|
|
|
1,344
|
|
|
1,344
|
|
|||
Trading securities
|
6,770
|
|
|
7,031
|
|
|
7,031
|
|
|||
Other invested assets
|
2,753
|
|
|
2,753
|
|
|
2,753
|
|
|||
Total Investments
|
$
|
89,679
|
|
|
$
|
94,539
|
|
|
$
|
89,934
|
|
(1)
|
Excludes amounts reclassified as Held-for-Sale.
|
(2)
|
Cost for fixed maturities represents original cost, reduced by repayments and write-downs and adjusted for amortization of premiums or accretion of discount; cost for equity securities represents original cost reduced by write-downs; cost for other limited partnership interests represents original cost adjusted for equity in earnings and reduced by distributions.
|
(3)
|
Carrying value for mortgage loans on real estate represents original cost adjusted for amortization of premiums or accretion of discount and reduced by valuation allowance.
|
|
2019
|
|
2018
|
||||
|
(in millions, except share amounts)
|
||||||
ASSETS
|
|
|
|
||||
Investment in consolidated subsidiaries
|
$
|
15,966
|
|
|
$
|
16,743
|
|
Fixed maturities available-for-sale, at fair value (amortized cost of $233 and $337)
|
236
|
|
|
336
|
|
||
Other equity investments
|
37
|
|
|
23
|
|
||
Other invested assets
|
—
|
|
|
80
|
|
||
Total investments
|
16,239
|
|
|
17,182
|
|
||
Cash and cash equivalents
|
1,353
|
|
|
407
|
|
||
Goodwill and other intangible assets, net
|
1,258
|
|
|
1,265
|
|
||
Loans to affiliates
|
560
|
|
|
572
|
|
||
Other assets
|
829
|
|
|
766
|
|
||
Total Assets
|
$
|
20,239
|
|
|
$
|
20,192
|
|
|
|
|
|
||||
LIABILITIES
|
|
|
|
||||
Short-term and long-term debt
|
$
|
4,111
|
|
|
$
|
4,408
|
|
Employee benefits liabilities
|
1,226
|
|
|
1,184
|
|
||
Loans from affiliates
|
1,200
|
|
|
600
|
|
||
Income taxes payable
|
68
|
|
|
16
|
|
||
Accrued liabilities
|
99
|
|
|
118
|
|
||
Total Liabilities
|
$
|
6,704
|
|
|
$
|
6,326
|
|
|
|
|
|
||||
EQUITY ATTRIBUTABLE TO HOLDINGS
|
|
|
|
||||
Preferred stock and additional paid-in capital, par value $1.00 per share; $25,000 liquidation preference at December 31, 2019
|
$
|
775
|
|
|
$
|
—
|
|
Common stock, $0.01 par value, 2,000,000,000 shares authorized; 552,896,328 and 561,000,000 shares issued, respectively; 463,711,392 and 528,861,758 shares outstanding, respectively
|
5
|
|
|
5
|
|
||
Additional paid-in capital
|
1,920
|
|
|
1,908
|
|
||
Treasury stock, at cost, 89,184,936 and 32,138,242 shares, respectively
|
(1,832
|
)
|
|
(640
|
)
|
||
Retained earnings
|
11,827
|
|
|
13,989
|
|
||
Accumulated other comprehensive income (loss)
|
840
|
|
|
(1,396
|
)
|
||
Total equity attributable to Holdings
|
13,535
|
|
|
13,866
|
|
||
Total Liabilities and Equity Attributable to Holdings
|
$
|
20,239
|
|
|
$
|
20,192
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
REVENUES
|
|
|
|
|
|
||||||
Equity in income (losses) from continuing operations of consolidated subsidiaries
|
$
|
(1,569
|
)
|
|
$
|
2,404
|
|
|
$
|
863
|
|
Net investment income (loss)
|
29
|
|
|
30
|
|
|
8
|
|
|||
Investment gains (losses), net
|
(1
|
)
|
|
(8
|
)
|
|
—
|
|
|||
Other income
|
12
|
|
|
(1
|
)
|
|
—
|
|
|||
Total revenues
|
(1,529
|
)
|
|
2,425
|
|
|
871
|
|
|||
|
|
|
|
|
|
||||||
EXPENSES
|
|
|
|
|
|
||||||
Interest expense
|
237
|
|
|
214
|
|
|
31
|
|
|||
Other operating costs and expenses
|
83
|
|
|
123
|
|
|
22
|
|
|||
Total expenses
|
320
|
|
|
337
|
|
|
53
|
|
|||
Income (loss) from continuing operations, before income taxes
|
(1,849
|
)
|
|
2,088
|
|
|
818
|
|
|||
Income tax (expense) benefit
|
116
|
|
|
(268
|
)
|
|
16
|
|
|||
Net income (loss) attributable to Holdings
|
(1,733
|
)
|
|
1,820
|
|
|
834
|
|
|||
Other comprehensive income (loss)
|
2,236
|
|
|
(1,192
|
)
|
|
816
|
|
|||
Total Comprehensive income (loss) attributable to Holdings
|
$
|
503
|
|
|
$
|
628
|
|
|
$
|
1,647
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Net income (loss) attributable to Holdings
|
$
|
(1,733
|
)
|
|
$
|
1,820
|
|
|
$
|
834
|
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
|
|
|
|
|
|
||||||
Equity in net (earnings) loss of subsidiaries
|
1,569
|
|
|
(2,404
|
)
|
|
(863
|
)
|
|||
Non-cash long term incentive compensation expense
|
69
|
|
|
—
|
|
|
—
|
|
|||
Amortization and depreciation
|
33
|
|
|
—
|
|
|
—
|
|
|||
Equity (income) loss limited partnerships
|
1
|
|
|
—
|
|
|
—
|
|
|||
Changes in:
|
|
|
|
|
|
||||||
Current and deferred taxes
|
194
|
|
|
111
|
|
|
(14
|
)
|
|||
Dividends from subsidiaries
|
1,341
|
|
|
1,838
|
|
|
20
|
|
|||
Other, net
|
(76
|
)
|
|
(264
|
)
|
|
24
|
|
|||
Net cash provided by (used in) operating activities
|
$
|
1,398
|
|
|
$
|
1,101
|
|
|
$
|
1
|
|
|
|
|
|
|
|
||||||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Proceeds from the sale/maturity/prepayment of:
|
|
|
|
|
|
||||||
Fixed maturities, available-for-sale
|
$
|
105
|
|
|
$
|
18
|
|
|
$
|
—
|
|
Short-term investments
|
80
|
|
|
1,038
|
|
|
—
|
|
|||
Payment for the purchase/origination of:
|
|
|
|
|
|
|
|||||
Fixed maturities, available-for-sale
|
—
|
|
|
(355
|
)
|
|
—
|
|
|||
Short-term investments
|
—
|
|
|
(1,113
|
)
|
|
—
|
|
|||
Other
|
(14
|
)
|
|
(16
|
)
|
|
—
|
|
|||
Repayments of loans to affiliates
|
572
|
|
|
1,045
|
|
|
—
|
|
|||
Issuance of loans to affiliates
|
(560
|
)
|
|
(572
|
)
|
|
(900
|
)
|
|||
Increase in cash and cash equivalents from merger of AXA Financial Inc.
|
—
|
|
|
381
|
|
|
—
|
|
|||
Increase in cash and cash equivalents from merger of AXA Tech
|
11
|
|
|
—
|
|
|
—
|
|
|||
Purchase of shares of consolidated subsidiaries
|
—
|
|
|
—
|
|
|
(55
|
)
|
|||
Other, net
|
—
|
|
|
(5
|
)
|
|
—
|
|
|||
Net cash provided by (used in) investing activities
|
$
|
194
|
|
|
$
|
421
|
|
|
$
|
(955
|
)
|
|
|
|
|
|
|
||||||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Issuance of preferred stock
|
$
|
775
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Issuance of long-term debt
|
—
|
|
|
4,057
|
|
|
—
|
|
|||
Repayment of long-term debt
|
(300
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from loans from affiliates
|
900
|
|
|
800
|
|
|
731
|
|
|||
Repayments of loans from affiliates
|
(300
|
)
|
|
(200
|
)
|
|
(56
|
)
|
|||
Shareholder dividends paid
|
(285
|
)
|
|
(157
|
)
|
|
—
|
|
|||
Purchase of AllianceBernstein Units
|
—
|
|
|
(1,340
|
)
|
|
—
|
|
|||
Purchase of treasury shares
|
(1,350
|
)
|
|
(648
|
)
|
|
—
|
|
|||
Capital Contribution from parent company
|
—
|
|
|
8
|
|
|
318
|
|
|||
Capital contribution to subsidiaries
|
(86
|
)
|
|
(3,679
|
)
|
|
—
|
|
|||
Net cash provided by (used in) financing activities
|
$
|
(646
|
)
|
|
$
|
(1,159
|
)
|
|
$
|
993
|
|
|
|
|
|
|
|
||||||
Change in cash and cash equivalents
|
946
|
|
|
363
|
|
|
39
|
|
|||
Cash and cash equivalents, beginning of year
|
407
|
|
|
44
|
|
|
5
|
|
|||
Cash and cash equivalents, end of year
|
$
|
1,353
|
|
|
$
|
407
|
|
|
$
|
44
|
|
|
|
|
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in millions)
|
||||||||||
Non-cash transactions:
|
|
|
|
|
|
||||||
Goodwill and intangible assets
|
$
|
—
|
|
|
$
|
1,079
|
|
|
$
|
—
|
|
Equity Investments
|
$
|
—
|
|
|
$
|
8
|
|
|
$
|
—
|
|
Other assets
|
$
|
4
|
|
|
$
|
774
|
|
|
$
|
—
|
|
Settlement of long-term debt
|
$
|
—
|
|
|
$
|
(349
|
)
|
|
$
|
—
|
|
Employee benefit plans
|
$
|
—
|
|
|
$
|
(1,168
|
)
|
|
$
|
—
|
|
Other liabilities
|
$
|
(16
|
)
|
|
$
|
(20
|
)
|
|
$
|
—
|
|
|
As of October 1, 2018
|
||||||
|
Assets
|
|
Liabilities
|
||||
|
(in millions)
|
||||||
Cash and cash equivalents
|
$
|
381
|
|
|
|
||
Goodwill and other intangibles assets, net
|
1,079
|
|
|
|
|||
Other equity investments
|
13
|
|
|
|
|||
Other assets
|
777
|
|
|
|
|||
Total Assets
|
$
|
2,250
|
|
|
|
||
|
|
|
|
||||
Employee benefit liabilities
|
|
|
$
|
1,168
|
|
||
Long-term debt
|
|
|
349
|
|
|||
Income taxes payable
|
|
|
2,106
|
|
|||
Other liabilities
|
|
|
20
|
|
|||
Total Liabilities
|
|
|
$
|
3,643
|
|
|
Individual Retirement
|
|
Group Retirement
|
|
Investment Management and Research
|
|
Protection Solutions
|
|
Corporate and Other
|
|
Total
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Deferred policy acquisition costs (3)
|
$
|
3,285
|
|
|
$
|
657
|
|
|
$
|
—
|
|
|
$
|
1,935
|
|
|
$
|
13
|
|
|
$
|
5,890
|
|
Policyholders’ account balances (3)
|
26,146
|
|
|
12,068
|
|
|
—
|
|
|
14,090
|
|
|
6,575
|
|
|
58,879
|
|
||||||
Future policy benefits and other policyholders' liabilities (3)
|
20,352
|
|
|
7
|
|
|
—
|
|
|
4,157
|
|
|
10,071
|
|
|
34,587
|
|
||||||
Policy charges and premium revenue
|
2,085
|
|
|
279
|
|
|
—
|
|
|
2,107
|
|
|
414
|
|
|
4,885
|
|
||||||
Net investment income (loss) (1)
|
(2,360
|
)
|
|
599
|
|
|
61
|
|
|
939
|
|
|
460
|
|
|
(301
|
)
|
||||||
Policyholders’ benefits and interest credited
|
2,334
|
|
|
304
|
|
|
—
|
|
|
2,123
|
|
|
850
|
|
|
5,611
|
|
||||||
Amortization of deferred policy acquisition costs
|
327
|
|
|
37
|
|
|
—
|
|
|
210
|
|
|
5
|
|
|
579
|
|
||||||
All other operating expenses (2)
|
785
|
|
|
319
|
|
|
2,710
|
|
|
575
|
|
|
1,047
|
|
|
5,436
|
|
(1)
|
Net investment income (loss) is allocated to segments. Includes net derivative gains (losses).
|
(2)
|
Operating expenses are allocated to segments.
|
(3)
|
Excludes amounts reclassified as Held-for-Sale.
|
|
Individual Retirement
|
|
Group Retirement
|
|
Investment Management and Research
|
|
Protection Solutions
|
|
Corporate and Other
|
|
Total
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Deferred policy acquisition costs
|
$
|
3,229
|
|
|
$
|
657
|
|
|
$
|
—
|
|
|
$
|
2,706
|
|
|
$
|
153
|
|
|
$
|
6,745
|
|
Policyholders’ account balances
|
20,798
|
|
|
11,617
|
|
|
—
|
|
|
13,989
|
|
|
3,519
|
|
|
49,923
|
|
||||||
Future policy benefits and other policyholders' liabilities
|
16,076
|
|
|
6
|
|
|
—
|
|
|
4,556
|
|
|
10,360
|
|
|
30,998
|
|
||||||
Policy charges and premium revenue
|
2,124
|
|
|
271
|
|
|
—
|
|
|
2,103
|
|
|
420
|
|
|
4,918
|
|
||||||
Net investment income (loss) (1)
|
497
|
|
|
552
|
|
|
36
|
|
|
903
|
|
|
474
|
|
|
2,462
|
|
||||||
Policyholders’ benefits and interest credited
|
590
|
|
|
294
|
|
|
—
|
|
|
2,308
|
|
|
813
|
|
|
4,005
|
|
||||||
Amortization of deferred policy acquisition costs
|
183
|
|
|
(8
|
)
|
|
—
|
|
|
161
|
|
|
(3
|
)
|
|
333
|
|
||||||
All other operating expenses (2)
|
764
|
|
|
325
|
|
|
2,538
|
|
|
561
|
|
|
1,091
|
|
|
5,279
|
|
(1)
|
Net investment income (loss) is allocated to segments. Includes net derivative gains (losses).
|
(2)
|
Operating expenses are allocated to segments.
|
|
Individual Retirement
|
|
Group Retirement
|
|
Investment Management and Research
|
|
Protection Solutions
|
|
Corporate and Other
|
|
Total
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Policy charges and premium revenue
|
$
|
2,116
|
|
|
$
|
248
|
|
|
$
|
—
|
|
|
$
|
1,995
|
|
|
$
|
458
|
|
|
$
|
4,817
|
|
Net investment income (loss) (1)
|
1,292
|
|
|
523
|
|
|
118
|
|
|
850
|
|
|
513
|
|
|
3,296
|
|
||||||
Policyholders’ benefits and interest credited
|
2,728
|
|
|
282
|
|
|
—
|
|
|
1,432
|
|
|
919
|
|
|
5,361
|
|
||||||
Amortization of deferred policy acquisition costs
|
114
|
|
|
25
|
|
|
—
|
|
|
374
|
|
|
(10
|
)
|
|
503
|
|
||||||
All other operating expenses (2)
|
881
|
|
|
463
|
|
|
2,517
|
|
|
734
|
|
|
695
|
|
|
5,290
|
|
(1)
|
Net investment income (loss) is allocated to segments. Includes net derivative gains (losses).
|
(2)
|
Operating expenses are allocated to segments.
|
|
Gross Amount
|
|
Ceded to Other Companies
|
|
Assumed from Other Companies
|
|
Net Amount
|
|
Percentage of Amount Assumed to Net
|
|||||||||
|
(in millions)
|
|||||||||||||||||
2019
|
|
|
|
|
|
|
|
|
|
|||||||||
Life insurance in-force
|
$
|
492,780
|
|
|
$
|
65,427
|
|
|
$
|
32,365
|
|
|
$
|
459,718
|
|
|
7.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Premiums:
|
|
|
|
|
|
|
|
|
|
|||||||||
Life insurance and annuities
|
$
|
971
|
|
|
$
|
101
|
|
|
$
|
211
|
|
|
$
|
1,081
|
|
|
19.5
|
%
|
Accident and health
|
97
|
|
|
40
|
|
|
9
|
|
|
66
|
|
|
13.6
|
%
|
||||
Total Premiums
|
$
|
1,068
|
|
|
$
|
141
|
|
|
$
|
220
|
|
|
$
|
1,147
|
|
|
19.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||||
2018
|
|
|
|
|
|
|
|
|
|
|||||||||
Life insurance in-force
|
$
|
488,431
|
|
|
$
|
69,255
|
|
|
$
|
31,249
|
|
|
$
|
450,425
|
|
|
6.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Premiums:
|
|
|
|
|
|
|
|
|
|
|||||||||
Life insurance and annuities
|
$
|
963
|
|
|
$
|
100
|
|
|
$
|
204
|
|
|
$
|
1,067
|
|
|
19.1
|
%
|
Accident and health
|
49
|
|
|
32
|
|
|
10
|
|
|
27
|
|
|
37.0
|
%
|
||||
Total Premiums
|
$
|
1,012
|
|
|
$
|
132
|
|
|
$
|
214
|
|
|
$
|
1,094
|
|
|
19.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||||
2017
|
|
|
|
|
|
|
|
|
|
|||||||||
Life insurance in-force
|
$
|
483,010
|
|
|
$
|
73,049
|
|
|
$
|
31,886
|
|
|
$
|
441,847
|
|
|
7.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Premiums:
|
|
|
|
|
|
|
|
|
|
|||||||||
Life insurance and annuities
|
$
|
984
|
|
|
$
|
103
|
|
|
$
|
216
|
|
|
$
|
1,097
|
|
|
19.7
|
%
|
Accident and health
|
54
|
|
|
36
|
|
|
9
|
|
|
27
|
|
|
33.3
|
%
|
||||
Total Premiums
|
$
|
1,038
|
|
|
$
|
139
|
|
|
$
|
225
|
|
|
$
|
1,124
|
|
|
20.0
|
%
|
(1)
|
Includes amounts related to the discontinued group life and health business.
|
(i)
|
the revision of the interim financial statements for the nine, six, and three months ended September 30, June 30, and March 31, 2018 and 2017, respectively, and the annual financial statements for the year ended December 31, 2017;
|
(ii)
|
the amended restatement of the interim financial statements for the nine months ended September 30, 2017 and the six months ended June 30, 2017, and the year ended December 31, 2016 and revisions for the six and three months ended June 30, 2018 and March 31, 2018, respectively, and the three months ended March 31, 2017 and the years ended December 31, 2017, 2015, 2014, and 2013, respectively
|
(iii)
|
the revision of the annual financial statements for the year ended December 31, 2017 and amended the restated annual financial statements for the year ended December 31, 2016, and amended the restated interim financial statements for the nine and six months ended September 30, 2017, and June 30, 2017, respectively;
|
•
|
We have designed, implemented and tested an enhanced model validation control framework, including a rotational schedule to periodically re-validate all U.S. GAAP models.
|
•
|
We have designed, implemented and tested enhanced controls and governance processes for new model implementations.
|
•
|
We have designed, implemented and tested enhanced controls for model changes.
|
•
|
We have designed, implemented and tested enhanced controls over the annual assumption setting process, including a comprehensive master assumption inventory and risk framework.
|
•
|
We have designed, implemented and tested new controls and are redesigning certain of these controls to validate the reliability of significant data flows feeding actuarial models and assumptions
|
•
|
With respect to insufficient personnel, we have strengthened our finance team by adding approximately 25 employees to the Accounting and Financial Reporting areas. These additional resources have provided additional requisite skills and experience needed to support a public-company accounting and reporting
|
•
|
To improve controls over journal entries, a less controlled secondary process that was used for consolidating certain entities, reflecting adjustments to prior periods, and generating the business segment disclosures has been eliminated. Beginning with third quarter 2018, all journal entries are recorded in the Company’s general ledger and the secondary process is no longer necessary.
|
•
|
We have enhanced the controls over journal entries through the implementation of new standards designed to ensure effective review and approval of journal entries with sufficient supporting documentation.
|
•
|
We have designed, implemented and tested new management review controls within the period end financial reporting process that operate at a level of precision sufficient to detect errors that could result in a material misstatement.
|
Plan category
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights
|
|
Weighted-average exercise price of outstanding options, warrants and rights
|
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
|
||||
|
(a)
|
|
(b)
|
|
(c)
|
||||
Equity compensation plans approved by security holders
|
|
|
|
|
|
||||
Omnibus Plan
|
6,819,575
|
|
(1)
|
$
|
19.72
|
|
(2)
|
5,515,168
|
|
Stock Purchase Plan (3)
|
|
|
|
|
7,302,016
|
|
|||
Equity compensation plans not approved by security holders
|
—
|
|
|
|
|
—
|
|
||
Total
|
6,819,575
|
|
|
|
|
12,814,184
|
|
(1)
|
Represents 2,317,991 outstanding Options, 2,578,980 outstanding Restricted Stock Units and 1,922,604 outstanding Performance Shares as of December 31, 2019 under the 2018 & 2019 Omnibus Plan. Totals include dividend equivalents on Performance Shares of 30,142 and on Restricted Stock Units of 81,550. The number of Performance Shares represents the number of shares that would be received based on maximum performance, reduced for cancellations through December 31, 2019. The actual number of shares the Compensation Committee will award at the end of each performance period will range between 0% and 200% of the target number of units granted, based upon a measure of the reported performance of the Company relative to stated goals.
|
(2)
|
Represents the weighted average exercise price of the Options disclosed in column (a).
|
(3)
|
The AXA Equitable Holdings, Inc. Stock Purchase Plan is a non-qualified Employee Stock Purchase Plan to which up to 8,000,000 shares of Common Stock were authorized for issuance, all of which have been registered on Form S-8. Under the plan, eligible participants have the opportunity to receive a 15% match on EQH share purchases, up to a maximum of $3,750 per calendar year. Employer matching contributions will be used to purchase additional shares for the participant. Participants may not contribute more than $50,000 through payroll deductions during any calendar year, and the maximum amount of contributions for a calendar year that is eligible to receive an employer matching contribution is $25,000.
|
|
|
Page Number
|
1.
|
||
2.
|
Financial Statement Schedules:
|
|
|
||
|
||
|
||
|
||
3.
|
Exhibits: See the accompanying Index to Exhibits.
|
|
Account Value (“AV”)
|
Generally equals the aggregate policy account value of our retirement and protection products. General Account AV refers to account balances in investment options that are backed by the General Account while Separate Accounts AV refers to Separate Accounts investment assets.
|
|
|
Alternative investments
|
Investments in real estate and real estate joint ventures and other limited partnerships.
|
|
|
Assets under administration (“AUA”)
|
Includes non-insurance client assets that are invested in our savings and investment products or serviced by our Equitable Advisors platform. We provide administrative services for these assets and generally record the revenues received as distribution fees.
|
|
|
Annualized Premium
|
100% of first year recurring premiums (up to target) and 10% of excess first year premiums or first year premiums from single premium products.
|
|
|
Assets under management (“AUM”)
|
Investment assets that are managed by one of our subsidiaries and includes: (i) assets managed by AB, (ii) the assets in our GAIA portfolio and (iii) the Separate Account assets of our retirement and protection businesses. Total AUM reflects exclusions between segments to avoid double counting.
|
|
|
Combined RBC Ratio
|
Calculated as the overall aggregate RBC ratio for the Company’s insurance subsidiaries including capital held for its life insurance and variable annuity liabilities and non-variable annuity insurance liabilities.
|
|
|
Conditional tail expectation (“CTE”)
|
Calculated as the average amount of total assets required to satisfy obligations over the life of the contract or policy in the worst x% of scenarios. Represented as CTE (100 less x). Example: CTE95 represents the worst five percent of scenarios.
|
|
|
Deferred policy acquisition cost (“DAC”)
|
Represents the incremental costs related directly to the successful acquisition of new and certain renewal insurance policies and annuity contracts and which have been deferred on the balance sheet as an asset.
|
|
|
Deferred sales inducements (“DSI”)
|
Represent amounts that are credited to a policyholder’s account balance that are higher than the expected crediting rates on similar contracts without such an inducement and that are an incentive to purchase a contract and also meet the accounting criteria to be deferred as an asset that is amortized over the life of the contract.
|
|
|
Dividends Received Deduction (“DRD”)
|
A tax deduction under U.S. federal income tax law received by a corporation on the dividends it receives from other corporations in which it has an ownership stake.
|
|
|
Gross Premiums
|
FYP and Renewal premium and deposits.
|
Invested assets
|
Includes fixed maturity securities, equity securities, mortgage loans, policy loans, alternative investments and short-term investments.
|
|
|
P&C
|
Property and casualty.
|
|
|
Premium and deposits
|
Amounts a policyholder agrees to pay for an insurance policy or annuity contract that may be paid in one or a series of payments as defined by the terms of the policy or contract.
|
|
|
Protection Solutions Reserves
|
Equals the aggregate value of Policyholders’ account balances and Future policy benefits for policies in our Protection Solutions segment.
|
|
|
Reinsurance
|
Insurance policies purchased by insurers to limit the total loss they would experience from an insurance claim.
|
|
|
Renewal premium and deposits
|
Premiums and deposits after the first twelve months of the policy or contract.
|
|
|
Risk-based capital (“RBC”)
|
Rules to determine insurance company statutory capital requirements. It is based on rules published by the National Association of Insurance Commissioners (“NAIC”).
|
|
|
Total adjusted capital (“TAC”)
|
Primarily consists of capital and surplus, and the asset valuation reserve.
|
|
|
Value of business acquired (“VOBA”)
|
Present value of estimated future gross profits from in-force policies of acquired businesses.
|
Product Terms
|
|
|
|
401(k)
|
A tax-deferred retirement savings plan sponsored by an employer. 401(k) refers to the section of the Internal Revenue Code of 1986, as amended (the “Code”) pursuant to which these plans are established.
|
|
|
403(b)
|
A tax-deferred retirement savings plan available to certain employees of public schools and certain tax-exempt organizations. 403(b) refers to the section of the Code pursuant to which these plans are established.
|
|
|
457(b)
|
A deferred compensation plan that is available to governmental and certain non-governmental employers. 457(b) refers to the section of the Code pursuant to which these plans are established.
|
|
|
Accumulation phase
|
The phase of a variable annuity contract during which assets accumulate based on the policyholder’s lump sum or periodic deposits and reinvested interest, capital gains and dividends that are generally tax-deferred.
|
|
|
Affluent
|
Refers to individuals with $250,000 to $999,999 of investable assets.
|
|
|
Annuitant
|
The person who receives annuity payments or the person whose life expectancy determines the amount of variable annuity payments upon annuitization of an annuity to be paid for life.
|
|
|
Annuitization
|
The process of converting an annuity investment into a series of periodic income payments, generally for life.
|
Benefit base
|
A notional amount (not actual cash value) used to calculate the owner’s guaranteed benefits within an annuity contract. The death benefit and living benefit within the same contract may not have the same benefit base.
|
|
|
Cash surrender value
|
The amount an insurance company pays (minus any surrender charge) to the policyholder when the contract or policy is voluntarily terminated prematurely.
|
|
|
Deferred annuity
|
An annuity purchased with premiums paid either over a period of years or as a lump sum, for which savings accumulate prior to annuitization or surrender, and upon annuitization, such savings are exchanged for either a future lump sum or periodic payments for a specified length of time or for a lifetime.
|
|
|
Dollar-for-dollar withdrawal
|
A method of calculating the reduction of a variable annuity benefit base after a withdrawal in which the benefit is reduced by one dollar for every dollar withdrawn.
|
|
|
Fixed annuity
|
An annuity that guarantees a set annual rate of return with interest at rates we determine, subject to specified minimums. Credited interest rates are guaranteed not to change for certain limited periods of time.
|
|
|
Fixed Rate GMxB
|
Guarantees on our individual variable annuity products that are based on a rate that is fixed at issue.
|
|
|
Floating Rate GMxB
|
Guarantees on our individual variable annuity products that are based on a rate that varies with a specified index rate, subject to a cap and floor.
|
|
|
Future policy benefits
|
Future policy benefits for the annuities business are comprised mainly of liabilities for life-contingent income annuities, and liabilities for the variable annuity guaranteed minimum benefits accounted for as insurance.
Future policy benefits for the life business are comprised mainly of liabilities for traditional life and certain liabilities for universal and variable life insurance contracts (other than the Policyholders’ account balance).
|
|
|
General Account Investment Portfolio
|
Means the invested assets held in the General Account.
|
|
|
General Account
|
Means the assets held in the general accounts of our insurance companies as well as assets held in our separate accounts on which we bear the investment risk.
|
|
|
Guaranteed minimum accumulation benefits (“GMAB”)
|
An optional benefit (available for an additional cost) which entitles an annuitant to a minimum payment, typically in lump-sum, after a set period of time, typically referred to as the accumulation period. The minimum payment is based on the benefit base, which could be greater than the underlying AV.
|
|
|
Guaranteed minimum death
benefits (“GMDB”)
|
An optional benefit (available for an additional cost) that guarantees an annuitant’s beneficiaries are entitled to a minimum payment based on the benefit base, which could be greater than the underlying AV, upon the death of the annuitant.
|
|
|
Guaranteed minimum income benefits (“GMIB”)
|
An optional benefit (available for an additional cost) where an annuitant is entitled to annuitize the policy and receive a minimum payment stream based on the benefit base, which could be greater than the underlying AV.
|
|
|
Guaranteed minimum living
benefits (“GMLB”)
|
A reference to all forms of guaranteed minimum living benefits, including GMIBs, GMWBs and GMABs (does not include GMDBs).
|
|
|
Guaranteed minimum withdrawal benefits (“GMWB”)
|
An optional benefit (available for an additional cost) where an annuitant is entitled to withdraw a maximum amount of their benefit base each year, for which cumulative payments to the annuitant could be greater than the underlying AV.
|
|
|
Guaranteed Universal Life (“GUL”)
|
A universal life insurance offering with a lifetime no lapse guarantee rider, otherwise known as a guaranteed UL policy. With a GUL policy, the premiums are guaranteed to last the life of the policy.
|
|
|
Guaranteed withdrawal benefit for life (“GWBL”)
|
An optional benefit (available for an additional cost) where an annuitant is entitled to withdraw a maximum amount of their benefit base each year, for the duration of the policyholder’s life, regardless of account performance.
|
|
|
High net worth
|
Refers to individuals with $1,000,000 or more of investable assets.
|
|
|
Index-linked annuities
|
An annuity that provides for asset accumulation and asset distribution needs with an ability to share in the upside from certain financial markets such as equity indices, or an interest rate benchmark. With an index-linked annuity, the policyholder’s AV can grow or decline due to various external financial market indices performance.
|
|
|
Indexed Universal Life (“IUL”)
|
A permanent life insurance offering built on a universal life insurance framework that uses an equity-linked approach for generating policy investment returns.
|
|
|
Living benefits
|
Optional benefits (available at an additional cost) that guarantee that the policyholder will get back at least his original investment when the money is withdrawn.
|
|
|
Mortality and expense risk fee (“M&E fee”)
|
A fee charged by insurance companies to compensate for the risk they take by issuing life insurance and variable annuity contracts.
|
Net flows
|
Net change in customer account balances in a period including, but not limited to, gross premiums, surrenders, withdrawals and benefits. It excludes investment performance, interest credited to customer accounts and policy charges.
|
|
|
Policyholder account balances
|
Annuities. Policyholder account balances are held for fixed deferred annuities, the fixed account portion of variable annuities and non-life contingent income annuities. Interest is credited to the policyholder’s account at interest rates we determine which are influenced by current market rates, subject to specified minimums.
Life Insurance Policies. Policyholder account balances are held for retained asset accounts, universal life policies and the fixed account of universal variable life insurance policies. Interest is credited to the policyholder’s account at interest rates we determine which are influenced by current market rates, subject to specified minimums.
|
|
|
Return of premium (“ROP”) death benefit
|
This death benefit pays the greater of the account value at the time of a claim following the owner’s death or the total contributions to the contract (subject to adjustment for withdrawals). The charge for this benefit is usually included in the M&E fee that is deducted daily from the net assets in each variable investment option. We also refer to this death benefit as the Return of Principal death benefit.
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Rider
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An optional feature or benefit that a policyholder can purchase at an additional cost.
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Roll-up rate
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The guaranteed percentage that the benefit base increases by each year.
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Separate Account
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Refers to the separate account investment assets of our insurance subsidiaries excluding the assets held in those separate accounts on which we bear the investment risk.
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Surrender charge
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A fee paid by a contract owner for the early withdrawal of an amount that exceeds a specific percentage or for cancellation of the contract within a specified amount of time after purchase.
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Surrender rate
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Represents annualized surrenders and withdrawals as a percentage of average AV.
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Universal life (“UL”) products
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Life insurance products that provide a death benefit in return for payment of specified annual policy charges that are generally related to specific costs, which may change over time. To the extent that the policyholder chooses to pay more than the charges required in any given year to keep the policy in-force, the excess premium will be placed into the AV of the policy and credited with a stated interest rate on a monthly basis.
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Variable annuity
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A type of annuity that offers guaranteed periodic payments for a defined period of time or for life and gives purchasers the ability to invest in various markets though the underlying investment options, which may result in potentially higher, but variable, returns.
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Variable Universal Life (“VUL”)
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Universal life products where the excess amount paid over policy charges can be directed by the policyholder into a variety of Separate Account investment options. In the Separate Account investment options, the policyholder bears the entire risk and returns of the investment results.
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Whole Life (“WL”)
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A life insurance policy that is guaranteed to remain in-force for the policyholder’s lifetime, provided the required premiums are paid.
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Exhibit Number
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Exhibit Description
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Amended and Restated Certificate of Incorporation of AXA Equitable Holdings, Inc. (incorporated by reference to Exhibit 3.1 to AXA Equitable Holdings, Inc.’s Form 10-Q for the quarterly period ending March 31, 2018, as filed on June 20, 2018 (the “Q-1 2018 Form 10-Q”)).
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Certificate of Amendment of Certificate of Incorporation, effective January 13, 2020 (incorporated by reference to Exhibit 3.1 to Holdings’ Form 8-K, filed on January 10, 2010).
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Amended and Restated By-laws of AXA Equitable Holdings, Inc. (incorporated by reference to Exhibit 3.2 to Holdings’ Form 8-K, filed on January 10, 2010).
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Certificate of Designations with respect to the Preferred Stock of the Company, dated November 21, 2019 (incorporated by reference to Exhibit 3.1 to Holdings’ Form 8-K filed on November 21, 2019).
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Form of Common Stock Certificate (incorporated by reference to Exhibit 4.1 to the Registration Statement on Form S-1 of AXA Equitable Holdings, Inc., File No. 333-221521 (the “IPO Form S-1”)).
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Indenture, dated as of December 1, 1993 from AXA Financial, Inc. to The Bank of NY Mellon Trust Company, N.A. (formerly known as Chemical Bank), as Trustee (incorporated by reference to Exhibit 4.2 to the IPO Form S-1).
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Fourth Supplemental Indenture, dated April 1, 1998, from AXA Financial, Inc. to The Chase Manhattan Bank (formerly known as Chemical Bank), as Trustee, together with forms of global Senior Note and global Senior Indenture (incorporated by reference to Exhibit 4.3 to the IPO Form S-1).
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Fifth Supplemental Indenture, dated October 1, 2018, among AXA Equitable Holdings, Inc. AXA Financial, Inc. and The Bank of NY Mellon Trust Company, N.A., as Trustee (incorporated by reference to Exhibit 4.1 to our Current Report on Form 8-K, filed on October 1, 2018).
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Indenture, dated as of April 20, 2018, among AXA Equitable Holdings, Inc., as issuer, Wilmington Saving Fund Society, FSB, as trustee, and Citibank, N.A., as security registrar and paying agent (incorporated by reference to Exhibit 4.4 to the IPO Form S-1).
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First Supplemental Indenture, dated as of April 20, 2018, among AXA Equitable Holdings, Inc., as issuer, Wilmington Saving Fund Society, FSB, as trustee, and Citibank, N.A., as security registrar and paying agent (incorporated by reference to Exhibit 4.5 to the IPO Form S-1).
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Second Supplemental Indenture, dated as of April 20, 2018, among AXA Equitable Holdings, Inc., as issuer, Wilmington Saving Fund Society, FSB, as trustee, and Citibank, N.A., as security registrar and paying agent (incorporated by reference to Exhibit 4.6 to the IPO Form S-1).
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Third Supplemental Indenture, dated as of April 20, 2018, among AXA Equitable Holdings, Inc., as issuer, Wilmington Saving Fund Society, FSB, as trustee, and Citibank, N.A., as security registrar and paying agent (incorporated by reference to Exhibit 4.7 to the IPO Form S-1).
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Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934.
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Shareholder Agreement, dated as of May 4, 2018, between AXA S.A. and AXA Equitable Holdings, Inc. (incorporated by reference to Exhibit 10.1 to the Q-1 2018 Form 10-Q).
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Registration Rights Agreement, dated as of May 4, 2018, between AXA S.A. and AXA Equitable Holdings, Inc. (incorporated by reference to Exhibit 10.2 to the Q-1 2018 Form 10-Q).
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Tax Sharing Agreement, dated March 28, 2018, between AXA S.A., AXA Investment Managers S.A. and AXA Equitable Holdings, Inc. (incorporated by reference to Exhibit 10.3 to the IPO Form S-1).
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Transitional Services Agreement, dated as of May 4, 2018, between AXA S.A. and AXA Equitable Holdings, Inc. (incorporated by reference to Exhibit 10.4 to the Q-1 2018 Form 10-Q).
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Master Agreement, dated as of April 10, 2013, by and among AXA Equitable Financial Services, LLC, AXA Financial, Inc. and Protective Life Insurance Company (incorporated by reference to Exhibit 10.5 to the IPO Form S-1).
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Trademark License Agreement, dated as of May 4, 2018, among AXA S.A., AXA Equitable Holdings, Inc. and AXA Financial, Inc. (incorporated by reference to Exhibit 10.5 to the Q-1 2018 Form 10-Q).
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Employment Agreement, dated as of March 9, 2011, by and between AXA Financial, Inc. and Mark Pearson (incorporated by reference to Exhibit 10.7 to the IPO Form S-1).
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Letter Agreement, dated February 19, 2013, between AXA Financial, Inc., AXA Equitable Life Insurance Company and Mark Pearson (incorporated by reference to Exhibit 10.7.1 to the IPO Form S-1).
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Letter Agreement, dated May 14, 2015, between AXA Financial, Inc., AXA Equitable Life Insurance Company and Mark Pearson (incorporated by reference to Exhibit 10.7.2 to the IPO Form S-1).
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Letter Agreement, dated February 27, 2019, between AXA Equitable Holdings, Inc., AXA Equitable Life Insurance Company and Mark Pearson. (incorporated by reference to Exhibit 10.7.3 to Holdings’ Form 10-K for the fiscal year ended December 31, 2018, as filed March 8, 2019 (the “2018 Form 10-K”)).
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Waiver Agreement, dated May 9, 2019, to Mark Pearson’s Employment Agreement dated March 9, 2011 (incorporated by reference to Exhibit 10.1 to AXA Equitable Holdings, Inc.’s Form 10-Q for the quarterly period ending June 30, 2019, as filed on August 9, 2019).
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Letter Agreement, dated December 18, 2019, between AXA Equitable Holdings, Inc., AXA Equitable Life Insurance Company and Mark Pearson (incorporated by reference to Exhibit 10.1 to Holdings’ Form 8-K filed on December 19, 2019).
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Director Indemnification Agreement, dated May 4, 2018, between AXA Equitable Holdings, Inc. and each of its directors (incorporated by reference to Exhibit 10.6 to the Q-1 2018 Form 10-Q).
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Commercial Paper Dealer Agreement 4(a)(2) Program, dated as of June 1, 2015, between AllianceBernstein L.P., as Issuer, and Citigroup Global Markets Inc., as Dealer (incorporated by reference to Exhibit 10.08 to AB Holding’s Form 10-K for the fiscal year ended December 31, 2015, as filed February 11, 2016).
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Commercial Paper Dealer Agreement 4(a)(2) Program, dated as of June 1, 2015, between AllianceBernstein L.P., as Issuer, and Credit Suisse Securities (USA) LLC, as Dealer (incorporated by reference to Exhibit 10.09 to AB Holding’s Form 10-K for the fiscal year ended December 31, 2015, as filed February 11, 2016).
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Commercial Paper Dealer Agreement 4(a)(2) Program, dated as of June 1, 2015, between AllianceBernstein L.P., as Issuer, and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Dealer (incorporated by reference to Exhibit 10.10 to AB Holding’s Form 10-K for the fiscal year ended December 31, 2015, as filed February 11, 2016).
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Revolving Credit Agreement, dated as of December 9, 2010, Amended and Restated as of January 17, 2012, Further Amended and Restated as of October 22, 2014 and Further Amended and Restated as of September 27, 2018, among AllianceBernstein L.P. and SCB LLC, as Borrowers; Bank of America, N.A., as Administrative Agent; Merrill Lynch, Pierce, Fenner & Smith Incorporated, Citibank, N.A., J.P. Morgan Chase Bank, N.A., HSBC Securities (USA) Inc., Sumitomo Mitsui Banking Corporation and State Street Bank and Trust Company, as joint lead arrangers and joint book managers, and the other lending institutions party thereto (incorporated by reference to Exhibit 10.01 to AB Holding’s Form 8-K, as filed October 3, 2018).
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Profit Sharing Plan for Employees of AllianceBernstein L.P., as amended and restated as of January 1, 2015 and as further amended as of January 1, 2017 (incorporated by reference to Exhibit 10.05 to AB Holding’s Form 10-K for the fiscal year ended December 31, 2015, as filed February 11, 2016).
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Amendment to the Profit Sharing Plan for Employees of AllianceBernstein L.P., dated as of October 20, 2016 and effective as of January 1, 2017 (incorporated by reference to Exhibit 10.06 to AB Holding’s Form 10-K for the fiscal year ended December 31, 2016, as filed February 14, 2017).
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Employment Agreement, dated as of April 28, 2017, among Seth Bernstein, AllianceBernstein Holding L.P., AllianceBernstein L.P. and AllianceBernstein Corporation (incorporated by reference to Exhibit 10.3 to AB Holding’s Form 8-K as filed May 1, 2017).
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Amendment to Seth P. Bernstein’s Employment Agreement (incorporated by reference to Exhibit 10.01 to AB Holding’s Form 10-K for the fiscal year ended December 31, 2018, as filed February 13, 2019).
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Amendment to Seth P. Bernstein’s Employment Agreement (incorporated by reference to Exhibit 10.2 to Holdings’ Form 8-K filed on December 19, 2019).
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AllianceBernstein L.P. 2017 Long Term Incentive Plan (incorporated by reference to Exhibit 10.06 to AB Holding’s Form 10-K for the fiscal year ended December 31, 2017, as filed February 13, 2018).
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Revolving Credit Agreement by and among AXA Equitable Holdings, Inc., the Subsidiary Account Parties (as defined therein) party thereto, the banks party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent. (incorporated by reference to Exhibit 10.22 to the IPO Form S-1).
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Form of Performance Share Award Agreement under the 2018 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.23 to the Q-1 2018 Form 10-Q).
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Reimbursement Agreement by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and Natixis, New York Branch (incorporated by reference to Exhibit 10.25 to the IPO Form S-1 ).
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Reimbursement Agreement by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and HSBC Bank USA, National Association (incorporated by reference to Exhibit 10.26 to the IPO Form S-1).
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Reimbursement Agreement by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and Citibank Europe PLC (incorporated by reference to Exhibit 10.27 to the IPO Form S-1).
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Reimbursement Agreement by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and Credit Agricole Corporate and Investment Bank (incorporated by reference to Exhibit 10.28 to the IPO Form S-1).
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Reimbursement Agreement by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and Barclays Bank PLC (incorporated by reference to Exhibit 10.29 to the IPO Form S-1).
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Reimbursement Agreement by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and JPMorgan Chase Bank, N.A (incorporated by reference to Exhibit 10.30 to the IPO Form S-1).
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Reimbursement Agreement by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and Landesbank Hessen-Thüringen Girozentrale, acting through its New York Branch (incorporated by reference to Exhibit 10.31 to the IPO Form S-1).
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Reimbursement Agreement by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and Commerzbank AG, New York Branch (incorporated by reference to Exhibit 10.32 to the IPO Form S-1).
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Letter Agreement between AXA Equitable Life Insurance Company and George Stansfield, dated June 30, 2015 (incorporated by reference to Exhibit 10.34 to the IPO Form S-1).
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AXA Stock Option Plan for AXA Financial Employees and Associates (incorporated by reference to Exhibit 10.36 to the IPO Form S-1).
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Form of Option Grant Letter under the AXA Stock Option Plan for AXA Financial Employees and Associates (Mark Pearson) (incorporated by reference to Exhibit 10.37 to the IPO Form S-1).
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Form of Option Grant Letter under the AXA Stock Option Plan for AXA Financial Employees and Associates (Executive Officers) (incorporated by reference to Exhibit 10.38 to the IPO Form S-1).
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Form of Option Agreement under the AXA Stock Option Plan for AXA Financial Employees and Associates (incorporated by reference to Exhibit 10.39 to the IPO Form S-1).
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Rules of 2015 AXA International Performance Share Plan and Addendum for AXA Financial Participants (incorporated by reference to Exhibit 10.41 to the IPO Form S-1).
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Rules of 2016 AXA International Performance Share Plan and Addendum for AXA Financial Participants (incorporated by reference to Exhibit 10.42 to the IPO Form S-1).
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Rules of AXA 2017 International Performance Shares Plan and Addendum for AXA Financial Participants (incorporated by reference to Exhibit 10.43 to the IPO Form S-1).
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AXA Equitable Severance Benefit Plan (incorporated by reference to Exhibit 10.45 to the IPO Form S-1).
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AXA Equitable Supplemental Severance Plan for Executives (incorporated by reference to Exhibit 10.25 to the Q-1 2018 Form 10-Q).
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AXA Equitable Executive Survivor Benefits Plan (incorporated by reference to Exhibit 10.47 to the IPO Form S-1).
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Amended and Restated Variable Deferred Compensation Plan for Executives (incorporated by reference to Exhibit 10.48 to the IPO Form S-1).
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Amended and Restated AXA Equitable Post-2004 Variable Deferred Compensation Plan for Executives (incorporated by reference to Exhibit 10.49 to the IPO Form S-1).
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AXA Equitable Excess Retirement Plan (incorporated by reference to Exhibit 10.50 to the IPO Form S-1).
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AXA Financial, Inc. Equity Plan for Directors (incorporated by reference to Exhibit 10.51 to the IPO Form S-1).
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Form of Stock Option Agreement under the AXA Financial, Inc. Equity Plan for Directors (incorporated by reference to Exhibit 10.52 to the IPO Form S-1).
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Form of Restricted Stock Agreement under the AXA Financial, Inc. Equity Plan for Directors (incorporated by reference to Exhibit 10.53 to the IPO Form S-1).
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AXA Equitable Post-2004 Variable Deferred Compensation Plan for Directors (incorporated by reference to Exhibit 10.54 to the IPO Form S-1).
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AXA Financial, Inc. Charitable Award Program for Directors (incorporated by reference to Exhibit 10.55 to the IPO Form S-1).
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AXA Equitable Holdings, Inc. Short-Term Incentive Compensation Plan (incorporated by reference to Exhibit 10.56 to the IPO Form S-1).
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AXA Equitable Holdings, Inc. 2018 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.57 to the IPO Form S-1).
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Form of Transaction Incentive Award Agreement under the 2018 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.21 to the Q-1 2018 Form 10-Q).
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Form of Restricted Stock Unit Award Agreement under the 2018 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.22 to the Q-1 2018 Form 10-Q).
|
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Form of Stock Option Award Agreement under the 2018 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.24 to the Q-1 2018 Form 10-Q).
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AXA Equitable Holdings, Inc. 2019 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.61 to the 2018 Form 10-K).
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AXA Equitable Holdings, Inc. Stock Purchase Plan (incorporated by reference to Exhibit 10.62 to the 2018 Form 10-K).
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Amendment to the Profit Sharing Plan for Employees of AllianceBernstein L.P., dated as of April 1, 2018 (incorporated by reference to Exhibit 10.12 to AB Holding’s Form 10-K for the fiscal year ended December 31, 2018, as filed February 13, 2019).
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Amendment to the AXA Equitable Post-2004 Variable Deferred Compensation Plan for Executives, effective as of January 1, 2019 (incorporated by reference to Exhibit 10.69 to the 2018 Form 10-K).
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|
Form of Performance Shares Award Agreement under the 2018 Omnibus Incentive Plan, effective as of February 14, 2019 (incorporated by reference to Exhibit 10.70 to the 2018 Form 10-K).
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Form of Restricted Stock Unit Award Agreement under the 2018 Omnibus Incentive Plan, effective as of February 14, 2019 (incorporated by reference to Exhibit 10.71 to the 2018 Form 10-K).
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|
Form of Stock Option Award Agreement under the 2018 Omnibus Incentive Plan, effective as of February 14, 2019 (incorporated by reference to Exhibit 10.70 to the 2018 Form 10-K).
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|
Share Repurchase Agreement between AXA S.A. and AXA Equitable Holdings, Inc., dated as of March 18, 2019 (incorporated by reference to Exhibit 10.73 to the Registration Statement on Form S-1 of AXA Equitable Holdings, Inc., File No. 333-230367).
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AXA Equitable Supplemental Severance Plan for Executives, as amended and restated as of August 9, 2019 (incorporated by reference to Exhibit 10.2 to AXA Equitable Holdings, Inc.’s Form 10-Q for the quarterly period ending June 30, 2019, as filed on August 9, 2019).
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AllianceBernstein 2019 Incentive Compensation Award Program (incorporated by reference to Exhibit 10.01 of AB Holding’s Form 10-K, as filed February 12, 2020 (the “AB 2019 Form 10-K”).
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AllianceBernstein 2019 Deferred Cash Compensation Program (incorporated by reference to Exhibit 10.02 of the AB 2019 Form 10-K).
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Form of Award Agreement, dated as of December 31, 2019, under Incentive Compensation Award Program, Deferred Cash Compensation Program and AB 2017 Long Term Incentive Plan (incorporated by reference to Exhibit 10.03 of the AB 2019 Form 10-K).
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Form of Award Agreement under AB 2017 Long Term Incentive Plan relating to equity compensation awards to Independent Directors (incorporated by reference to Exhibit 10.04 of the AB 2019 Form 10-K).
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List of Subsidiaries of AXA Equitable Holdings, Inc.
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Consent of PricewaterhouseCoopers LLP.
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Certification of the Registrant’s Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
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Certification of the Registrant’s Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
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Certification of the Registrant’s Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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Certification of the Registrant’s Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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101.INS
|
|
XBRL Instance Document
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
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#
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|
Filed herewith.
|
†
|
|
Identifies each management contract or compensatory plan or arrangement.
|
|
EQUITABLE HOLDINGS, INC.
|
|
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|
By:
|
/s/ Mark Pearson
|
|
|
Name: Mark Pearson
|
|
|
Title: President and Chief Executive Officer
|
Signature
|
|
Title
|
|
|
|
/s/ Mark Pearson
|
|
President and Chief Executive Officer and Director
(Principal Executive Officer)
|
Mark Pearson
|
|
|
|
|
|
/s/ Anders B. Malmström
|
|
Senior Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
Anders B. Malmström
|
|
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|
/s/ William Eckert
|
|
Senior Vice President and Chief Accounting Officer
(Principal Accounting Officer)
|
William Eckert
|
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/s/ Daniel G. Kaye
|
|
Director
|
Daniel G. Kaye
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/s/ Joan M. Lamm-Tennant
|
|
Director
|
Joan M. Lamm-Tennant
|
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/s/ Kristi A. Matus
|
|
Director
|
Kristi A. Matus
|
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|
|
/s/ Ramon de Oliveira
|
|
Chairman of the Board
|
Ramon de Oliveira
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/s/ Bertram L. Scott
|
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Director
|
Bertram L. Scott
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/s/ George H. Stansfield
|
|
Director
|
George H. Stansfield
|
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/s/ Charles G. T. Stonehill
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Director
|
Charles G. T. Stonehill
|
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•
|
to cast one vote for each share held of record on all matters submitted to a vote of the stockholders;
|
•
|
to receive, on a pro rata basis, dividends and distributions, if any, that Holdings’ Board may declare out of legally available funds, subject to preferences that may be applicable to preferred stock, if any, then outstanding; and
|
•
|
upon Holdings’ liquidation, dissolution or winding up, to share equally and ratably in any assets remaining after the payment of all debt and other liabilities, subject to the prior rights, if any, of holders of any outstanding shares of preferred stock.
|
•
|
liability and indemnification of directors;
|
•
|
corporate opportunities;
|
•
|
elimination of stockholders action by written consent;
|
•
|
prohibition on the rights of stockholders to call a special meeting; and
|
•
|
required approval of the holders of at least 66 2/3% of the outstanding shares of Holdings’ common stock to amend Holdings’ amended and restated by-laws and certain provisions of Holdings’ amended and restated certificate of incorporation.
|
•
|
any breach of the director’s duty of loyalty;
|
•
|
acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of the law;
|
•
|
unlawful payments of dividends or unlawful stock repurchases, redemptions or other distributions; or
|
•
|
any transaction from which the director derives an improper personal benefit.
|
•
|
senior to Holdings’ common stock and all other junior stock;
|
•
|
senior to or on a parity with each other series of Holdings’ preferred stock that it may issue (except for any senior stock that may be issued upon the requisite vote or consent of the holders of at least a two-thirds majority of the shares of the Preferred Stock at the time outstanding and entitled to vote and the requisite vote or consent of all other series of preferred stock) with respect to the payment of dividends and distributions of assets upon Holdings’ liquidation, dissolution or winding-up; and
|
•
|
junior to all existing and future indebtedness and other non-equity claims on us.
|
(i)
|
no dividend shall be declared or paid or set aside for payment and no distribution shall be declared or made or set aside for payment on any junior stock (other than (1) a dividend payable solely in junior stock or (2) any dividend in connection with the implementation of a stockholders’ rights plan or the redemption or repurchase of any rights under such plan),
|
(ii)
|
no shares of junior stock shall be repurchased, redeemed or otherwise acquired for consideration by Holdings, directly or indirectly (other than (1) as a result of a reclassification of junior stock for or into other junior stock, (2) the exchange or conversion of one share of junior stock for or into another share of junior stock, (3) purchases, redemptions or other acquisitions of shares of junior stock in connection with any employment contract, benefit plan or other similar arrangement with or for the benefit of employees, officers, directors or consultants, (4) the purchase of fractional interests in shares of junior stock pursuant to the conversion or exchange provisions of such securities or the security being converted or exchanged and (5) through the use of the proceeds of a substantially contemporaneous sale of other shares of junior stock) nor shall any monies be paid to or made available for a sinking fund for the redemption of any such securities by Holdings, and
|
(iii)
|
no shares of dividend parity stock shall be repurchased, redeemed or otherwise acquired for consideration by Holdings other than pursuant to pro rata offers to purchase all, or a pro rata portion, of the Preferred Stock and such dividend parity stock (other than the exchange or conversion of such dividend parity stock for or into shares of junior stock).
|
•
|
the shortening of the length of time the Preferred Stock is assigned a particular level of equity credit by that rating agency as compared to the length of time it would have been assigned that level of equity credit by that rating agency or its predecessor on the initial issuance of the Preferred Stock; or
|
•
|
the lowering of the equity credit (including up to a lesser amount) assigned to the Preferred Stock by that rating agency as compared to the equity credit assigned by that rating agency or its predecessor on the initial issuance of the Preferred Stock.
|
•
|
any amendment to, or change in, the laws, rules or regulations of the United States or any political subdivision of or in the United States or any other governmental agency or instrumentality as may then have group-wide oversight of Holdings’ regulatory capital that is enacted or becomes effective after the initial issuance of the Preferred Stock,
|
•
|
any proposed amendment to, or change in, those laws, rules or regulations that is announced or becomes effective after the initial issuance of the Preferred Stock, or
|
•
|
any official administrative decision or judicial decision or administrative action or other official pronouncement interpreting or applying those laws, rules or regulations that is announced after the initial issuance of the Preferred Stock.
|
•
|
the redemption date;
|
•
|
the number of shares of the Preferred Stock to be redeemed and, if less than all shares of the Preferred Stock held by the holder are to be redeemed, the number of shares to be redeemed from the holder;
|
•
|
the redemption price or the manner of its calculation; and
|
•
|
if Preferred Stock is evidenced by definitive certificates, the place or places where the certificates representing those shares are to be surrendered for payment of the redemption price.
|
•
|
authorize or increase the authorized amount of, or issue shares of any class or series of senior stock, or issue any obligation or security convertible into or evidencing the right to purchase any such shares;
|
•
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amend the provisions of Holdings’ amended and restated certificate of incorporation so as to adversely affect the powers, preferences, privileges or rights of the Preferred Stock, taken as a whole; provided, however, that any increase in the amount of the authorized or issued Preferred Stock or authorized common stock or preferred stock or the creation and issuance, or an increase in the authorized or issued amount, of other series of preferred stock ranking equally with or junior to the Preferred Stock with respect to the payment of dividends (whether such dividends are cumulative or noncumulative) or the distribution of assets upon Holdings’ liquidation, dissolution or winding-up will not be deemed to adversely affect the powers, preferences, privileges or rights of the Preferred Stock; or
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•
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consolidate with or merge into any other corporation unless the shares of Preferred Stock outstanding at the time of such consolidation or merger or sale are converted into or exchanged for preference securities having such rights, privileges and voting powers, taken as a whole, as are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers of the Preferred Stock, taken as a whole.
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List of Subsidiaries as of December 31, 2019
|
|
|
|
Entity Name
|
State or other jurisdiction of incorporation or organization
|
AXA Equitable Holdings, Inc.
|
DE
|
Alpha Units Holdings, Inc.
|
DE
|
AllianceBernstein Corporation
|
DE
|
SEE LISTING A
|
|
AXA Corporate Solutions Life Reinsurance Company
|
DE
|
CS Life Re Company
|
AZ
|
AXA-IM Holding US Inc.
|
DE
|
787 Holdings, LLC
|
DE
|
1285 Holdings, LLC
|
DE
|
AXA Strategic Ventures US, LLC
|
DE
|
AXA Equitable Financial Services, LLC
|
DE
|
EQ AZ Life Re Company
|
AZ
|
AXA Distribution Holding Corporation
|
DE
|
AXA Advisors, LLC
|
DE
|
AXA Network, LLC
|
DE
|
AXA Network of Puerto Rico, Inc.
|
P.R.
|
PlanConnect, LLC
|
DE
|
AXA Equitable Life Insurance Company
|
NY
|
AXA Equitable Funds Management Group LLC
|
DE
|
Broad Vista Partners, LLC
|
DE
|
Long Creek Club Partners, LLC
|
DE
|
Equitable Holdings, LLC
|
NY
|
Equitable Casualty Insurance Company
|
VT
|
AXA Distributors, LLC
|
DE
|
J.M.R. Realty Services, Inc.
|
DE
|
Equitable Structured Settlement Corp.
|
DE
|
Equitable Managed Assets, L.P.
|
DE
|
EVSA, Inc.
|
DE
|
Separate Account 166, LLC
|
DE
|
AXA Equitable Life and Annuity Company
|
CO
|
MONY International Holdings, LLC
|
DE
|
MONY International Life Insurance Co. Seguros de Vida S.A.
|
Argentina
|
MONY Financial Resources of the Americas Limited
|
Jamaica
|
MBT, Ltd.
|
Cayman Islands
|
MONY Consultoria e Corretagem de Seguros Ltda.
|
Brazil
|
MONY Life Insurance Company of the Americas, Ltd.
|
Cayman Islands
|
Equitable Financial Life Insurance Company of America
|
AZ
|
U.S. Financial Life Insurance Company
|
OH
|
MONY Financial Services, Inc.
|
DE
|
Financial Marketing Agency, Inc.
|
OH
|
1740 Advisers, Inc.
|
NY
|
List of Subsidiaries as of December 31, 2019
|
|
|
|
Entity Name
|
State or other jurisdiction of incorporation or organization
|
LISTING A - AllianceBernstein Corporation
|
|
AXA Equitable Holdings, Inc.
|
|
Alpha Units Holdings, Inc.
|
|
AllianceBernstein Corporation
|
|
AllianceBernstein Holding L.P.
|
DE
|
AllianceBernstein L.P.
|
DE
|
AllianceBernstein Investments Taiwan Limited
|
Taiwan
|
AB Trust Company, LLC
|
NH
|
Alliance Capital Management LLC
|
DE
|
AllianceBernstein Real Estate Investments LLC
|
DE
|
AB Private Credit Investors LLC
|
DE
|
AB Custom Alternative Investments LLC
|
DE
|
Sanford C. Bernstein & Co., LLC
|
DE
|
Autonomous Research US LP
|
NY
|
Sanford C. Bernstein (Canada) Limited
|
Canada
|
AllianceBernstein International, LLC
|
DE
|
Sanford C. Bernstein (Schwiez) GmbH
|
Switzerland
|
Sanford C. Bernstein (Hong Kong) Limited
|
Hong Kong
|
Sanford C. Bernstein (Australia) Pty Limited
|
Australia
|
Autonomous Research Asia Limited
|
Hong Kong
|
Sanford C. Bernstein (Ireland) Limited
|
Ireland
|
AllianceBernstein Holdings Limited
|
U.K.
|
AllianceBernstein Corporation of Delaware
|
DE
|
ACAM Trust Company Private Ltd.
|
India
|
AllianceBernstein (Argentina) S.R.L.
|
Argentina
|
AllianceBernstein (Chile) SpA
|
Chile
|
AllianceBernstein Japan Ltd.
|
Japan
|
AllianceBernstein Invest. Manage. Australia Limited
|
Australia
|
AllianceBernstein Global Derivatives Corp.
|
DE
|
AllianceBernstein Administradora de Carteiras (Brasil) Ltda.
|
Brazil
|
AllianceBernstein Holdings (Cayman) Ltd.
|
Cayman Isles
|
AllianceBernstein Preferred Limited
|
U.K.
|
CPH Capital Fondsmaeglerselskab A/S
|
Denmark
|
AB Bernstein Israel Ltd.
|
Israel
|
AllianceBernstein Limited
|
U.K.
|
AB Europe GmbH
|
Germany
|
AllianceBernstein Services Limited
|
U.K.
|
AllianceBernstein Schweiz AG
|
Switzerland
|
AllianceBernstein (Luxembourg) S.a.r.l.
|
Lux.
|
AllianceBernstein (France) SAS
|
France
|
AllianceBernstein (Mexico) S. de R.L. de C.V.
|
Mexico
|
AllianceBernstein Australia Limited
|
Australia
|
AllianceBernstein Canada, Inc.
|
Canada
|
AllianceBernstein (Singapore) Ltd.
|
Singapore
|
AllianceBernstein Portugal, Unipessoal LDA
|
Portugal
|
Alliance Capital (Mauritius) Private Limited
|
Mauritius
|
List of Subsidiaries as of December 31, 2019
|
|
|
|
Entity Name
|
State or other jurisdiction of incorporation or organization
|
AllianceBernstein Solutions (India) Private Limited
|
India
|
AllianceBernstein Invest. Res. & Man. (India) Private Ltd.
|
India
|
Sanford C. Bernstein (India) Limited
|
India
|
AllianceBernstein Oceanic Corporation
|
DE
|
AllianceBernstein Asset Management (Korea) Ltd.
|
South Korea
|
AllianceBernstein Investments, Inc.
|
DE
|
AllianceBernstein Investor Services, Inc.
|
DE
|
AllianceBernstein Hong Kong Limited
|
Hong Kong
|
AB (Shanghai) Investment Management Co., Ltd.
|
China
|
AB (Shanghai) Overseas Investment Fund Management Co., Ltd.
|
China
|
Sanford C. Bernstein (Autonomous UK) 1 Limited
|
U.K.
|
Autonomous Research LLP (100% by SCB (Autonomous UK) 1 Ltd.)
|
U.K.
|
Autonomous Research Limited
|
U.K.
|
Autonomous Research Investments Limited
|
U.K.
|
Autonomous Research Investments 1 LLP
|
U.K.
|
Autonomous Research 2 LLP
|
U.K.
|
Sanford C. Bernstein Limited
|
U.K.
|
Sanford C. Bernstein (CREST Nominees) Ltd.
|
U.K.
|
W.P. Stewart & Co., LLC.
|
DE
|
WPS Advisors, LLC.
|
DE
|
W.P. Stewart Asset Management LLC
|
DE
|
W.P. Stewart Securities LLC
|
DE
|
W.P. Stewart Asset Management (NA), LLC.
|
NY
|
W.P. Stewart Fund Management S.A.
|
Luxembourg
|
/s/ Mark Pearson
|
Mark Pearson
|
President and Chief Executive Officer
|
/s/ Anders Malmström
|
Anders Malmström
|
Senior Executive Vice President and
Chief Financial Officer |
/s/ Mark Pearson
|
Mark Pearson
|
President and Chief Executive Officer
|
/s/ Anders Malmström
|
Anders Malmström
|
Senior Executive Vice President and
Chief Financial Officer
|