Corebridge Financial has reported a net income of $771 million in the second quarter of 2023, representing a 70% decrease compared to the prior year quarter.
The change largely was driven by lower realised gains recorded for the Fortitude Re funds withheld embedded derivative, partially offset by higher net investment income and changes in the fair value of market risk benefits.
Adjusted pre-tax operating income (APTOI) was $836 million, a 37% increase compared to the prior year quarter. Base portfolio income was the largest contributor to the year-over-year improvement.
At the same time, net investment income was $2.7 billion, a 19% increase compared to the prior year quarter, while net investment income on an APTOI basis was $2.5 billion, an 18% increase compared to the prior year quarter.
Corebridge noted that the improvement largely was due to higher base portfolio income, which grew $508 million, or 27%, compared to the prior year quarter. This was partially offset by lower variable investment income which declined $24 million, or 20%, over the same period.
Elsewhere, Corebridge’s premiums and deposits were $9.9 billion, a 42% increase compared to the prior year quarter.
Within its Individual Retirement segment, premiums and deposits increased $0.4 billion, or 12%, as compared to the prior year quarter largely driven by growth of fixed index annuity deposits, partially offset by lower fixed annuity and variable annuity deposits.
Additionally, within the Group Retirement segment, premiums and deposits increased $151 million, or 9%, as compared to the prior year quarter due to higher out-of-plan fixed annuity deposits, partially offset by lower out-of-plan variable annuity deposits and plan acquisitions.
Kevin Hogan, President and Chief Executive Officer of Corebridge, commented: “This was an excellent quarter for Corebridge, where we continued to benefit from our focused execution, disciplined risk management and the competitive strengths of our diversified businesses. We generated nearly $10 billion of premiums and deposits, a 42% increase over the prior year. Base spread income also grew 42% year over year, and our businesses remain well positioned to capitalize on current market opportunities.”
He continued: “Corebridge returned $750 million to shareholders this quarter, through a combination of dividends and share repurchases. We are pleased to have begun our share repurchase program only nine months after our initial public offering, marking an important milestone in our commitment to provide an attractive capital return to shareholders.”
“Also, we believe the sale of Laya Healthcare unlocks significant value for shareholders and represents an important step in maintaining our focus on the life and retirement businesses in the United States.”
“Going into the second half of the year, we remain focused on executing our strategies and optimizing our capital to generate long-term growth in shareholder value,” he concluded.
