Retirement services firm Athene has posted a second quarter net income of $824 million, compared to $720 million in the second quarter 2019.
The increase from the prior year quarter was driven by higher adjusted operating income and favorable changes in the fair value of reinsurance assets due to tightening credit spreads, partially offset by a net decrease in the fair value of fixed indexed annuity (“FIA”) derivatives due to a lower discount rate resulting from declining interest rates.
Adjusted operating income was $490 million, compared to $370 million in the prior years quarter.
“Our second quarter results demonstrate the resilience of Athene’s business and our ability to serve as a source of strength for our policyholders and business partners during periods of market disruption,” said Jim Belardi, CEO of Athene.
“We generated nearly $7 billion of organic deposits at exceptional returns, a quarterly record, with strength exhibited across all our channels during a period when others were forced to pull back.
“At the same time, we closed a large-scale block reinsurance transaction with Jackson National that added nearly $30 billion of growth to our balance sheet with predictable, persistent fixed annuity liabilities we know very well.
“Following this strong growth, Athene remains one of the best capitalized businesses in the industry, with $3 billion of excess equity capital and more than $7 billion of total deployable capital, which can be used for more than $85 billion of opportunistic growth.”
Mr. Belardi continued, “In the quarter, we generated strong normalized profitability in our core spread-based business. As we continue to invest our cash balances and redeploy the inherited Jackson portfolio, our earnings power and our capital base will continue to grow at attractive rates.”
In the second quarter 2020, Athene generated record quarterly flow reinsurance deposits of $2.3 billion, an increase of 101% year-over-year and 163% quarter-over-quarter, which was driven by strong volumes from existing partnerships who sought to utilize Athene’s competitive advantages.
