Attached files
| file | filename |
|---|---|
| 8-K - 8-K - Equitable Holdings, Inc. | a8-kq12020earnings.htm |
| EX-99.1 - EXHIBIT 99.1 - Equitable Holdings, Inc. | eqhq12020earningsrelease.htm |
Table of Contents Consolidated Financials and Key Metrics Page Key Metrics Summary 4 Consolidated Statements of Income (Loss) 5 Consolidated Balance Sheets 6 Consolidated Capital Structure 7 Operating Earnings (Loss) by Segment and Corporate and Other 8 Assets Under Management and Administration 9 Sales Metrics by Segment 10 Select Metrics from Business Segments Individual Retirement Statements of Operating Earnings (Loss) and Summary Metrics 12 Select Operating Metrics 13 Group Retirement Statements of Operating Earnings (Loss) and Summary Metrics 14 Select Operating Metrics 15 Investment Management and Research Statements of Operating Earnings (Loss) and Summary Metrics 16 Select Operating Metrics 17 Net Flows 18 Protection Solutions Statements of Operating Earnings (Loss) and Summary Metrics 19 Select Operating Metrics 20 Investments Consolidated Investment Portfolio Composition 22 Consolidated Results of General Account Investment Portfolio 23 Additional Information Deferred Policy Acquisition Costs Rollforward 25 Use of Non-GAAP Financial Measures 26 Reconciliation of Non-GAAP Measures 28 Glossary of Selected Financial and Product Terms 31 Analyst Coverage, Ratings & Contact Information 32 This financial supplement should be read in conjunction with Equitable Holdings, Inc.’s (“EQH”) Quarterly Report on Form 10-Q for the quarter ended March 31, 2020. Equitable Holdings’ filings with the Securities and Exchange Commission (“SEC”) can be accessed upon filing at the SEC’s website at www.sec.gov, and at our website at ir.equitableholdings.com. All information included in this financial supplement is unaudited. This financial supplement includes information from prior periods which have been revised and/or restated. For additional details, please refer to our Form 10-Q for the quarter ended March 31, 2020 1Q 2020 Financial Supplement 2
Consolidated Financials and Key Metrics 1Q 2020 Financial Supplement 3
Key Metrics Summary For the Three Months Ended or As of For the Three Months Ended or As of (in millions USD, except per share and O/S share amounts) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Change 3/31/2019 3/31/2020 Change Net income (loss) $ (709) $ 430 $ (316) $ (841) $ 5,447 868.3 % $ (709) $ 5,447 868.3 % Net income (loss) attributable to the noncontrolling interest (66) (67) (68) (96) (37) 43.9 % (66) (37) 43.9 % Net income (loss) attributable to Holdings $ (775) $ 363 $ (384) $ (937) $ 5,410 798.1 % $ (775) $ 5,410 798.1 % Non-GAAP Operating Earnings (1) $ 509 $ 559 $ 677 $ 652 $ 515 1.2 % $ 509 $ 515 1.2 % Total equity attributable to Holdings' shareholders $ 13,143 $ 14,843 $ 14,936 $ 13,535 $ 20,086 52.8 % $ 13,143 $ 20,086 52.8 % Less: Preferred Stock — — — 775 775 100.0 % — 775 100.0 % Total equity attributable to Holdings' common shareholders 13,143 14,843 14,936 12,760 19,311 46.9 % 13,143 19,311 46.9 % Less: Accumulated other comprehensive income (loss) (513) $ 876 $ 1,468 $ 840 2,289 546.2 % $ (513) $ 2,289 546.2 % Total equity attributable to Holdings' common shareholders (ex. AOCI) $ 13,656 $ 13,967 $ 13,468 $ 11,920 $ 17,022 24.6 % $ 13,656 $ 17,022 24.6 % Return on Equity (ex. AOCI) - TTM 5.8% 7.2% 8.1% (13.1)% 31.5% 5.8% 31.5% Non-GAAP Operating ROE (1) (2) 15.2% 15.9% 16.0% 18.1 % 17.0% 15.2% 17.0% — % Debt to capital: Debt to Capital 27.4% 24.6% 24.3% 23.3 % 17.4% 27.4% 17.4% Debt to Capital (ex. AOCI) 26.6% 25.8% 26.3% 24.5 % 19.2% 26.6% 19.2% Per common share: Diluted earnings per common share: (3) Net income (loss) attributable to Holdings $ (1.50) $ 0.74 $ (0.78) $ (1.97) $ 11.65 878.4 % $ (1.50) $ 11.65 878.4 % Non-GAAP Operating Earnings (1) $ 0.98 $ 1.14 $ 1.38 $ 1.37 $ 1.08 10.2 % $ 0.98 $ 1.08 10.2 % Book value per common share $ 26.77 $ 30.22 $ 30.53 $ 27.52 $ 42.86 60.1 % $ 26.77 $ 42.86 60.1 % Book value per common share (ex. AOCI) $ 27.81 $ 28.44 $ 27.53 $ 25.71 $ 37.78 35.8 % $ 27.81 $ 37.78 35.8 % Weighted-average common shares outstanding: Basic 518.0 491.1 490.4 474.9 461.0 (11.0)% 518.0 461.0 (11.0)% Diluted 518.0 491.9 490.4 474.9 463.5 (10.5)% 518.0 463.5 (10.5)% Ending common shares outstanding 491.0 491.1 489.3 463.7 450.5 (8.2)% 491.0 450.5 (8.2)% Return to common shareholders: Common stock dividend $ 68 $ 73 $ 74 $ 70 $ 69 $ 68 $ 69 Repurchase of common shares 750 — 37 563 205 750 205 Total capital returned to common shareholders $ 818 $ 73 $ 111 $ 633 $ 274 $ 818 $ 274 Market Values: S&P 500 2,834 2,942 2,977 3,231 2,585 (8.8)% 2,834 2,585 (8.8)% US 10-Year Treasury 2.4% 2.0% 1.7% 1.9 % 0.7% 2.4% 0.7% Notes: (1) This measure is a Non-GAAP financial measure. For an explanation of our use of Non-GAAP financial measures, refer to the “Use of Non-GAAP Financial Measures” and "Glossary of Selected Financial and Product Terms" sections of this document. For a reconciliation of this item to the most directly comparable GAAP measure, refer to the “Non-GAAP Reconciliation” section in this document. (2) Prior periods before 6/30/19 reflect pro forma adjustments. (3) For loss periods, dilutive shares were not included in the calculation of net income (loss) available to shareholders per common share or adjusted earnings per common share as inclusion of such shares would have an anti-dilutive effect. 1Q 2020 Financial Supplement 4
Consolidated Statements of Income (Loss) For the Three Months Ended For the Three Months Ended (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Change 3/31/2019 3/31/2020 Change Revenues Policy charges and fee income $ 931 $ 941 $ 929 $ 937 $ 991 6.4 % $ 931 $ 991 6.4 % Premiums 283 280 284 300 289 2.1 % 283 289 2.1 % Net derivative gains (losses) (1,630) (236) (451) (1,683) 9,401 676.7 % (1,630) 9,401 676.7 % Net investment income (loss) 1,015 976 824 884 616 (39.3)% 1,015 616 (39.3)% Investment gains (losses), net (11) (12) 199 (103) 4 136.4 % (11) 4 136.4 % Investment management and service fees 999 1,072 1,101 1,208 1,136 13.7 % 999 1,136 13.7 % Other income 127 139 142 146 156 22.8 % 127 156 22.8 % Total revenues 1,714 3,160 3,028 1,689 12,593 634.7 % 1,714 12,593 634.7 % Benefits and other deductions Policyholders’ benefits 880 896 1,757 837 2,788 216.8 % 880 2,788 216.8 % Interest credited to policyholders’ account balances 304 314 304 319 317 4.3 % 304 317 4.3 % Compensation and benefits 509 512 502 558 526 3.3 % 509 526 3.3 % Commissions and distribution related payments 281 307 317 337 338 20.3 % 281 338 20.3 % Interest expense 56 57 54 54 52 (7.1)% 56 52 (7.1)% Amortization of deferred policy acquisition costs 198 177 85 119 1,248 530.3 % 198 1,248 530.3 % Other operating costs and expenses 410 456 449 577 437 6.6 % 410 437 6.6 % Total benefits and other deductions 2,638 2,719 3,468 2,801 5,706 116.3 % 2,638 5,706 116.3 % Income (loss) from operations, before income taxes (924) 441 (440) (1,112) 6,887 845.3 % (924) 6,887 845.3 % Income tax (expense) benefit 215 (11) 124 271 (1,440) (769.8)% 215 (1,440) (769.8)% Net income (loss) (709) 430 (316) (841) 5,447 868.3 % (709) 5,447 868.3 % Less: net (income) loss attributable to the noncontrolling interest (66) (67) (68) (96) (37) 43.9 % (66) (37) 43.9 % Net income (loss) attributable to Holdings $ (775) $ 363 $ (384) $ (937) $ 5,410 798.1 % $ (775) $ 5,410 798.1 % Less: Preferred stock dividends — — — — (13) (100.0)% — (13) (100.0)% Net income (loss) available to Holdings' common shareholders $ (775) $ 363 $ (384) $ (937) $ 5,397 796.4 % $ (775) $ 5,397 796.4 % Adjustments related to: Variable annuity product features (1) $ 1,540 $ 200 $ 1,444 $ 1,694 $ (6,861) $ 1,540 $ (6,861) Investment gains (losses), net 11 12 (199) 103 (4) 11 (4) Net actuarial gains (losses) related to pension and other postretirement benefit 24 24 24 27 27 24 27 obligations Other adjustments (2) (3) 40 89 78 199 634 40 634 Income tax (expense) benefit related to above adjustments (4) (337) (71) (282) (424) 1,303 (337) 1,303 Non-recurring tax items 6 (58) (4) (10) 6 6 6 Non-GAAP Operating earnings (5) $ 509 $ 559 $ 677 $ 652 $ 515 $ 509 $ 515 Notes: (1) Includes COVID-19 impact on Variable annuity product features due to assumption update of $1.5 billion and other COVID-19 related impacts of $35 million for the three months ended March 31, 2020. (2) Includes separation costs of $32 million and $24 million for the three months ended March 31, 2020 and 2019. (3) Includes assumption update due to COVID-19 of $1.0 billion and other COVID-19 related impacts of $51 million for the three months ended March 31, 2020. (4) Includes income taxes of $(534) million for the above related COVID-19 items for the three months ended March 31, 2020. (5) This measure is a Non-GAAP financial measure. For an explanation of our use of Non-GAAP financial measures, refer to the “Use of Non-GAAP Financial Measures” and "Glossary of Selected Financial and Product Terms" sections of this document. For a reconciliation of this item to the most directly comparable GAAP measure, refer to the “Non-GAAP Reconciliation” section in this document. 1Q 2020 Financial Supplement 5
Consolidated Balance Sheets Balances as of (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Assets Total investments $ 82,948 $ 86,901 $ 94,717 $ 93,340 $ 96,216 Cash and cash equivalents 5,129 4,734 4,471 4,405 10,315 Cash and securities segregated, at fair value 1,262 1,110 958 1,095 2,013 Broker-dealer related receivables 2,122 2,156 1,935 1,987 2,436 Deferred policy acquisition costs 6,018 6,080 5,787 5,890 4,809 Goodwill and other intangible assets, net 4,769 4,776 4,765 4,751 4,760 Amounts due from reinsurers 4,850 4,740 4,656 4,592 4,614 GMIB reinsurance contract asset, at fair value 1,740 1,896 2,452 2,139 2,823 Other assets 3,787 3,760 3,882 3,799 5,824 Assets held-for-sale — — — 962 843 Separate Accounts assets 120,194 122,444 121,023 126,910 106,128 Total assets $ 232,819 $ 238,597 $ 244,646 $ 249,870 $ 240,781 Liabilities Policyholders’ account balances $ 52,197 $ 53,211 $ 56,719 $ 58,879 $ 55,810 Future policy benefits and other policyholders’ liabilities 31,462 32,381 36,310 34,587 37,968 Broker-dealer related payables 494 443 519 722 1,001 Customers related payables 2,999 2,686 2,381 2,523 3,630 Amounts due to reinsurers 1,372 1,390 1,387 1,404 1,380 Short-term and long-term debt 4,949 4,852 4,794 4,111 4,217 Income taxes payable 482 689 864 549 2,355 Other liabilities 3,781 3,856 3,833 3,970 5,716 Liabilities held-for-sale — — — 724 679 Separate Accounts liabilities 120,194 122,444 121,023 126,910 106,128 Total liabilities 217,930 221,952 227,830 234,379 218,884 Redeemable noncontrolling interest 207 257 338 365 257 Equity Preferred stock — — — 775 775 Common stock 5 5 5 5 5 Additional paid-in capital 1,881 1,901 1,897 1,920 1,930 Treasury shares (1,234) (1,232) (1,269) (1,832) (2,025) Retained earnings 13,004 13,293 12,835 11,827 17,112 Accumulated other comprehensive income (loss) (513) 876 1,468 840 2,289 Total equity attributable to Holdings 13,143 14,843 14,936 13,535 20,086 Noncontrolling interest 1,539 1,545 1,542 1,591 1,554 Total equity 14,682 16,388 16,478 15,126 21,640 Total liabilities, redeemable noncontrolling interest and equity $ 232,819 $ 238,597 $ 244,646 $ 249,870 $ 240,781 1Q 2020 Financial Supplement 6
Consolidated Capital Structure Balances as of (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Short-term and long-term debt: Short-term debt AB commercial paper $ 540 $ 443 $ 303 $ — $ 105 AB revolving credit facility — — 80 — — Total short-term debt 540 443 383 — 105 Total long-term debt 4,409 4,409 4,411 4,111 4,112 Total short-term and long-term debt: [A] $ 4,949 $ 4,852 $ 4,794 $ 4,111 $ 4,217 Equity: Preferred stock $ — $ — $ — $ 775 $ 775 Common stock $ 5 $ 5 $ 5 $ 5 $ 5 Additional paid-in capital 1,881 1,901 1,897 1,920 1,930 Treasury stock, at cost (1,234) (1,232) (1,269) (1,832) (2,025) Retained earnings 13,004 13,293 12,835 11,827 17,112 Accumulated other comprehensive income (loss) (513) 876 1,468 840 2,289 Total equity attributable to Holdings 13,143 14,843 14,936 13,535 20,086 Noncontrolling interest 1,539 1,545 1,542 1,591 1,554 Total equity $ 14,682 $ 16,388 $ 16,478 $ 15,126 $ 21,640 Total equity attributable to Holdings, (ex. AOCI): [B] $ 13,656 $ 13,967 $ 13,468 $ 12,695 $ 17,797 Capital: Total capitalization $ 18,092 $ 19,695 $ 19,730 $ 17,646 $ 24,303 Total capitalization (ex. AOCI): [A+B] $ 18,605 $ 18,819 $ 18,262 $ 16,806 $ 22,014 Debt to capital: Debt to capital 27.4% 24.6% 24.3% 23.3% 17.4% Debt to capital (ex. AOCI) 26.6% 25.8% 26.3% 24.5% 19.2% For the Three Months Ended Roll-forward of common shares outstanding (millions of shares): Beginning balance 528.9 491.0 491.1 489.3 463.7 Repurchases (30.0) — (1.8) (25.6) (13.7) Retirements (8.1) — — — — Issuances 0.2 0.1 — — 0.5 Ending basic common shares outstanding 491.0 491.1 489.3 463.7 450.5 Total potentially dilutive shares — — — — 2.5 Ending common shares outstanding - maximum potential dilution 491.0 491.1 489.3 463.7 453.0 1Q 2020 Financial Supplement 7
Operating Earnings (Loss) by Segment and Corporate and Other Three Months Ended March 31, 2020 Individual Retirement (in millions USD, unless otherwise indicated) (1) Group Retirement Inv Mgmt and Research Protection Solutions Corporate and Other Consolidated Revenues Policy charges, fee income and premiums $ 501 $ 71 $ — $ 557 $ 105 $ 1,234 Net investment income (loss) 316 159 (33) 244 103 789 Net derivative gains (losses) 487 — 30 2 (6) 513 Investment Management, service fees and other income 177 52 910 56 97 1,292 Segment revenues 1,481 282 907 859 299 3,828 Benefits and other deductions Policyholders’ benefits 679 — — 502 179 1,360 Interest credited to policyholders’ account balances 82 76 — 127 38 323 Commissions and distribution related payments 72 11 140 40 75 338 Amortization of deferred policy acquisition costs 88 12 — 56 2 158 Compensation, benefits and other operating costs and expenses 107 54 558 88 73 880 Interest expense and financing fees — — 2 — 56 58 Segment benefits and other deductions 1,028 153 700 813 423 3,117 Operating earnings (loss), before income taxes 453 129 207 46 (124) 711 Income Taxes (81) (23) (37) (8) 21 (128) Operating earnings (loss), before noncontrolling interest 372 106 170 38 (103) 583 Less: Operating (earnings) loss attributable to the noncontrolling interest — — (75) — 7 (68) Operating earnings (loss) $ 372 $ 106 $ 95 $ 38 $ (96) $ 515 Three Months Ended March 31, 2019 Individual Retirement Group Retirement Inv Mgmt and Research Protection Solutions Corporate and Other Consolidated Revenues Policy charges, fee income and premiums $ 498 $ 65 $ — $ 542 $ 109 $ 1,214 Net investment income (loss) 268 134 24 224 136 786 Net derivative gains (losses) 63 4 (20) 10 (2) 55 Investment Management, service fees and other income 178 48 776 55 69 1,126 Segment revenues 1,007 251 780 831 312 3,181 Benefits and other deductions Policyholders’ benefits 244 — — 452 184 880 Interest credited to policyholders’ account balances 62 73 — 138 30 303 Commissions and distribution related payments 66 10 106 38 61 281 Amortization of deferred policy acquisition costs 83 12 — 50 (7) 138 Compensation, benefits and other operating costs and expenses 111 60 509 95 68 843 Interest Expense and Financing Fees — — 4 — 52 56 Segment benefits and other deductions 566 155 619 773 388 2,501 Operating earnings (loss), before income taxes 441 96 161 58 (76) 680 Income Taxes (71) (15) (29) (9) 11 (113) Operating earnings (loss), before noncontrolling interest 370 81 132 49 (65) 567 Less: Operating (earnings) loss attributable to the noncontrolling interest — — (55) — (3) (58) Operating earnings (loss) $ 370 $ 81 $ 77 $ 49 $ (68) $ 509 Notes (1) In the first quarter of 2019, we modified our Operating earnings measure. For additional information on the impact to the measure, see the “Business Segments: Operating Earnings Results and Metrics—Individual Retirement” section herein. 1Q 2020 Financial Supplement 8
Assets Under Management and Administration Balances as of (in billions USD, except for Equitable Headcount) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Assets Under Management AB AUM Total AB $ 554.7 $ 580.8 $ 592.4 $ 622.9 $ 541.8 Exclusion for General Account and other Affiliated Accounts (62.9) (66.8) (75.2) (74.4) (77.4) Exclusion for Separate Accounts (36.3) (37.0) (36.6) (38.5) (30.9) AB third party $ 455.5 $ 477.0 $ 480.6 $ 509.9 $ 433.5 Total company AUM AB third party $ 455.5 $ 477.0 $ 480.6 $ 509.9 $ 433.5 General Account and other Affiliated Accounts 88.1 91.6 99.2 97.7 106.5 Separate Accounts 120.2 122.4 121.0 126.9 106.1 Total AUM $ 663.8 $ 691.1 $ 700.8 $ 734.6 $ 646.2 Total Assets Under Administration (AUA) (1) $ 47.8 $ 50.1 $ 50.8 $ 54.1 $ 47.9 Equitable Advisor Headcount Total Number of Equitable Advisors (2) 4,410 4,360 4,330 4,487 4,357 Notes: (1) AUA includes Equitable Advisors Advisory and Brokerage AUA; Equitable Advisors broker-dealer business is included in Corporate and Other. (2) Increased qualification requirements for retired advisors in the first quarter of 2019 resulting in a reduction of 233 advisors. 1Q 2020 Financial Supplement 9
Sales Metrics by Segment For the Three Months Ended For the Three Months Ended (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Change 3/31/2019 3/31/2020 Change Insurance Operations Individual Retirement First year premiums and deposits $ 1,879 $ 2,093 $ 2,062 $ 2,157 $ 1,918 2.0 % $ 1,879 $ 1,918 2.0 % Renewal premium and deposits 95 92 80 82 76 (20.3)% 95 76 (20.3)% Total Gross Premiums $ 1,974 $ 2,185 $ 2,142 $ 2,239 $ 1,993 1.0 % $ 1,974 $ 1,993 1.0 % Group Retirement First year premiums and deposits $ 329 $ 358 $ 332 $ 469 $ 364 10.7 % $ 329 $ 364 10.7 % Renewal premium and deposits 511 552 438 544 561 9.8 % 511 561 9.8 % Total Gross Premiums $ 840 $ 910 $ 770 $ 1,013 $ 925 10.1 % $ 840 $ 925 10.1 % Protection Solutions First year premiums and deposits $ 111 $ 113 $ 113 $ 122 $ 99 (10.4)% $ 111 $ 99 (10.4)% Renewal premium and deposits 675 633 664 668 679 0.5 % 675 679 0.5 % Total Gross Premiums $ 786 $ 746 $ 777 $ 790 $ 778 (1.0)% $ 786 $ 778 (1.0)% Investment Management and Research (in billions USD) Gross Sales by distribution channel Institutional $ 3.4 $ 5.5 $ 2.9 $ 5.4 $ 3.9 16.1 % $ 3.4 $ 3.9 16.1 % Retail 16.4 18.8 21.1 18.9 24.2 47.6 % 16.4 24.2 47.6 % Private Wealth Management 3.3 3.0 2.3 2.7 3.5 4.8 % 3.3 3.5 4.8 % Firmwide Gross Sales $ 23.1 $ 27.3 $ 26.3 $ 27.0 $ 31.6 36.8 % $ 23.1 $ 31.6 36.8 % Gross sales by investment service Equity Active $ 7.9 $ 8.8 $ 6.9 $ 10.9 $ 12.1 52.9 % $ 7.9 12.1 52.9 % Equity Passive (1) — — 0.3 0.3 0.4 N/M — 0.4 N/M Fixed Income - Taxable 11.5 13.1 16.2 12.2 14.7 27.8 % 11.5 14.7 27.8 % Fixed Income - Tax-Exempt 2.6 2.6 2.5 2.4 2.9 13.4 % 2.6 2.9 13.4 % Fixed Income Passive (1) — 0.1 — — — (100.0)% — — (100.0)% Other (2) 1.1 2.8 0.4 1.2 1.5 36.1 % 1.1 1.5 36.1 % Firmwide Gross Sales $ 23.1 $ 27.4 $ 26.3 $ 27.0 $ 31.6 36.9 % $ 23.1 $ 31.6 36.9 % Notes: (1) Includes index and enhanced index services. (2) Includes certain multi-asset solutions and services and certain alternative investments. 1Q 2020 Financial Supplement 10
Business Segments: Operating Earnings Results and Metrics 1Q 2020 Financial Supplement 11
Individual Retirement - Operating Earnings (Loss) and Summary Metrics For the Three Months Ended or As of For the Three Months Ended or As of (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Change 3/31/2019 3/31/2020 Change Revenues Policy charges, fee income and premiums $ 498 $ 524 $ 538 $ 525 $ 501 0.6 % $ 498 $ 501 0.6 % Net investment income (loss) 268 280 287 313 316 17.9 % 268 316 17.9 % Net derivative gains (losses) 63 87 175 52 487 673.0 % 63 487 673.0 % Investment management, service fees and other income 178 182 186 184 177 (0.6)% 178 177 (0.6)% Segment revenues 1,007 1,073 1,186 1,074 1,481 47.1 % 1,007 1,481 47.1 % Benefits and other deductions Policyholders’ benefits 244 291 391 282 679 178.3 % 244 679 178.3 % Interest credited to policyholders’ account balances 62 84 61 81 82 32.3 % 62 82 32.3 % Commissions and distribution-related payments 66 71 72 72 72 9.1 % 66 72 9.1 % Amortization of deferred policy acquisition costs 83 75 10 52 88 6.0 % 83 88 6.0 % Compensation and benefits, interest expense and financing fees and other operating costs and expense 111 114 100 110 107 (3.6)% 111 107 (3.6)% Segment benefits and other deductions 566 635 634 597 1,028 81.6 % 566 1,028 81.6 % Operating earnings (loss), before income taxes 441 438 552 477 453 2.7 % 441 453 2.7 % Income taxes (71) (79) (95) (86) (81) (14.1)% (71) (81) (14.1)% Operating earnings (loss), before noncontrolling interest 370 359 457 391 372 0.5 % 370 372 0.5 % Less: Operating (earnings) loss attributable to the noncontrolling interest — — — — — — % — — — % Operating earnings (loss) $ 370 $ 359 $ 457 $ 391 $ 372 0.5 % $ 370 $ 372 0.5 % Summary Metrics Operating earnings (loss) - TTM: [A] $ 1,557 $ 1,511 $ 1,534 $ 1,577 $ 1,579 1.4 % $ 1,557 $ 1,579 1.4 % Average capital - TTM: [B] $ 6,881 $ 6,917 $ 7,180 $ 7,362 $ 7,327 6.5 % $ 6,881 $ 7,327 6.5 % Non-GAAP Operating ROC - TTM (1): [A/B] 22.6% 21.8% 21.4% 21.4% 21.6% 22.6% 21.6% Average Account Value $ 98,543 $ 103,402 $ 104,143 $ 106,450 $ 101,256 2.8 % $ 98,543 $ 101,256 2.8 % Return on assets 1.87% 1.73% 1.76% 1.79% 1.90% 1.87% 1.90% Net flows Current Product Offering $ 841 $ 845 $ 802 $ 842 $ 615 (27.0)% $ 841 $ 615 (27.0)% Fixed Rate (929) (937) (925) (1,038) (935) (0.6)% (929) (935) (0.6)% Net flows $ (88) $ (92) $ (123) $ (196) $ (320) (265.5)% $ (88) $ (320) (265.5)% First year premiums and deposits $ 1,879 $ 2,093 $ 2,062 $ 2,157 $ 1,918 2.0 % $ 1,879 $ 1,918 2.1 % In-force Policy Count by Product (in thousands): Fixed rate 370 365 360 357 351 370 351 Current product offering 537 542 546 549 553 537 553 Total 907 907 906 906 904 907 904 Notes: (1) This measure is a Non-GAAP financial measure. For an explanation of our use of Non-GAAP financial measures, refer to the “Use of Non-GAAP Financial Measures” and "Glossary of Selected Financial and Product Terms" sections of this document. 1Q 2020 Financial Supplement 12
Individual Retirement - Select Operating Metrics For the Three Months Ended or As of For the Three Months Ended or As of (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 3/31/2019 3/31/2020 Sales Metrics First Year Premiums by Product: SCS $ 1,106 $ 1,302 $ 1,305 $ 1,425 $ 1,227 $ 1,106 $ 1,227 Retirement Cornerstone 583 543 522 507 461 583 461 Investment Edge 110 152 146 141 132 110 132 Other 80 96 89 84 98 80 98 Total First Year Premiums $ 1,879 $ 2,093 $ 2,062 $ 2,157 $ 1,918 $ 1,879 $ 1,918 First Year Premiums by Guarantee: Non-GMxB $ 1,239 $ 1,433 $ 1,483 $ 1,573 $ 1,377 $ 1,239 $ 1,377 ROP death benefit only 119 165 118 149 135 119 135 Total non-GMxB & ROP death benefit only 1,358 1,598 1,601 1,722 1,512 1,358 1,512 Floating rate GMxB 511 479 449 425 398 511 398 Fixed rate GMxB 10 16 12 10 8 10 8 Total First Year Premiums $ 1,879 $ 2,093 $ 2,062 $ 2,157 $ 1,918 $ 1,879 $ 1,918 Account Values General Account: Balance as of beginning of period $ 20,631 $ 22,677 $ 23,455 $ 24,409 $ 26,108 $ 20,631 $ 26,108 Gross premiums 1,177 1,268 1,273 1,315 1,376 1,177 1,376 Surrenders, withdrawals and benefits (473) (501) (474) (477) (477) (473) (477) Net flows 704 767 799 838 899 704 899 Investment performance, interest credited and policy charges 1,342 469 155 861 (3,136) 1,342 (3,136) Transfer to Corp & Other — (458) — — — — — Other (2) — — — — (6) — (6) Reclassified to Assets held-for-sale — — — — (3) — (3) Balance as of end of period $ 22,677 $ 23,455 $ 24,409 $ 26,108 $ 23,862 $ 22,677 $ 23,862 Separate Accounts: Balance as of beginning of period $ 73,958 $ 79,821 $ 80,852 $ 79,570 $ 82,814 $ 73,958 $ 82,814 Gross premiums 861 905 862 911 614 861 614 Surrenders, withdrawals and benefits (1,653) (1,764) (1,784) (1,945) (1,833) (1,653) (1,833) Net flows (792) (859) (922) (1,034) (1,219) (792) (1,219) Investment performance, interest credited and policy charges 6,655 1,890 (360) 4,278 (11,868) 6,655 (11,868) Transfer to Corp & Other — — — — — — — Other (2) — — — — — — — Reclassified to Assets held-for-sale — — — — — — — Balance as of end of period $ 79,821 $ 80,852 $ 79,570 $ 82,814 $ 69,727 $ 79,821 $ 69,727 Total: Balance as of beginning of period $ 94,589 $ 102,498 $ 104,307 $ 103,979 $ 108,922 $ 94,589 $ 108,922 Gross premiums (1) 2,038 2,173 2,135 2,226 1,990 2,038 1,990 Surrenders, withdrawals and benefits (2,126) (2,265) (2,258) (2,422) (2,310) (2,126) (2,310) Net flows (88) (92) (123) (196) (320) (88) (320) Investment performance, interest credited and policy charges 7,997 2,359 (205) 5,139 (15,004) 7,997 (15,004) Transfer to Corp & Other — (458) — — — — — Other (2) — — — — (6) — (6) Reclassified to Assets held-for-sale — — — — (3) — (3) Balance as of end of period $ 102,498 $ 104,307 $ 103,979 $ 108,922 $ 93,589 $ 102,498 $ 93,589 Net Amount at Risk (NAR) Total GMIB NAR $ 7,791 $ 8,577 $ 9,980 $ 8,746 $ 16,184 $ 7,791 $ 16,184 Total GMDB NAR 20,048 19,697 20,399 19,122 25,791 20,048 25,791 Reserves (Net of Reinsurance) GMIB Reserves $ 7,846 $ 8,481 $ 11,433 $ 10,675 $ 12,779 $ 7,846 $ 12,779 GMDB Reserves 4,560 4,606 4,663 4,677 4,939 4,560 4,939 Total GMDB/IB Variable Annuity Reserves (Net of Reinsurance) $ 12,406 $ 13,087 $ 16,096 $ 15,352 $ 17,718 $ 12,406 $ 17,718 Notes: (1) Includes deposits from certain other products not reported as first year premiums and deposits or renewal premiums and deposits elsewhere in this document. (2) Represents amounts related to our fixed income annuity (“FIA”) contracts which were previously reported as Policyholders’ account balances in the consolidated balance sheets and therefore included in our definition of “Account Value”. As of March 31, 2020, FIAs are reported as Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets and accordingly were excluded from Account Value. 1Q 2020 Financial Supplement 13
Group Retirement - Operating Earnings (Loss) and Summary Metrics For the Three Months Ended or As of For the Three Months Ended or As of (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Change 3/31/2019 3/31/2020 Change Revenues Policy charges, fee income and premiums $ 65 $ 69 $ 72 $ 73 $ 71 9.2 % $ 65 $ 71 9.2 % Net investment income (loss) 134 150 148 158 159 18.7 % 134 159 18.7 % Net derivative gains (losses) 4 (2) 1 1 — (100.0)% 4 — (100.0)% Investment management, service fees and other income 48 50 51 55 52 8.3 % 48 52 8.3 % Segment revenues 251 267 272 287 282 12.4 % 251 282 12.4 % Benefits and other deductions Policyholder benefits — 1 — 1 — — % — — — % Interest credited to policyholders’ account balances 73 75 78 76 76 4.1 % 73 76 4.1 % Commissions and distribution-related payments 10 11 9 12 11 10.0 % 10 11 10.0 % Amortization of deferred policy acquisition costs 12 10 5 8 12 — % 12 12 — % Compensation and benefits, interest expense and financing fees and other operating costs and expense 60 54 54 56 54 (10.0)% 60 54 (10.0)% Segment benefits and other deductions 155 151 146 153 153 (1.3)% 155 153 (1.3)% Operating earnings (loss), before income taxes 96 116 126 134 129 34.4 % 96 129 34.4 % Income taxes (15) (21) (22) (24) (23) (53.3)% (15) (23) (53.3)% Operating earnings (loss), before noncontrolling interest 81 95 104 110 106 30.9 % 81 106 30.9 % Less: Operating (earnings) loss attributable to the noncontrolling interest — — — — — — % — — — % Operating earnings (loss) $ 81 $ 95 $ 104 $ 110 $ 106 30.9 % $ 81 $ 106 30.9 % Summary Metrics Operating earnings (loss) - TTM: [A] $ 394 $ 412 $ 382 $ 390 $ 415 N/M $ 394 $ 415 5.3 % Average capital - TTM: [B] $ 1,256 $ 1,285 $ 1,310 $ 1,335 $ 1,271 N/M $ 1,256 $ 1,271 1.2 % Non-GAAP Operating ROC - TTM (1): [A/B] 31.3% 32.1% 29.2% 29.2% 32.7% 31.3% 32.7% Average Account Value $ 33,739 $ 35,567 $ 36,059 $ 36,971 $ 35,514 5.3 % $ 33,739 $ 35,514 5.3 % Return on assets 1.39% 1.38% 1.27% 1.28% 1.42% 1.39% 1.42% Net flows $ 107 $ 164 $ (23) $ 19 $ 128 19.9 % $ 107 $ 128 19.9 % Gross premiums $ 840 $ 910 $ 770 $ 1,013 $ 925 10.1 % $ 840 $ 925 10.1 % Notes: (1) This measure is a Non-GAAP financial measure. For an explanation of our use of Non-GAAP financial measures, refer to the “Use of Non-GAAP Financial Measures” and "Glossary of Selected Financial and Product Terms" sections of this document. 1Q 2020 Financial Supplement 14
Group Retirement - Select Operating Metrics For the Three Months Ended For the Three Months Ended or As of or As of (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 3/31/2019 3/31/2020 Sales Metrics Gross premiums: First-year premiums $ 329 $ 358 $ 332 $ 469 $ 364 $ 329 $ 364 Renewal premiums 511 552 438 544 561 511 561 Group Retirement premiums $ 840 $ 910 $ 770 $ 1,013 $ 925 $ 840 $ 925 Gross premiums by market: Tax-exempt $ 198 $ 223 $ 224 $ 257 $ 214 $ 198 $ 214 Corporate 123 122 93 199 135 123 135 Other 8 13 15 13 15 8 15 Total First Year Premiums 329 358 332 469 364 329 364 Tax-exempt 376 420 313 422 412 376 412 Corporate 87 82 83 78 89 87 89 Other 48 50 42 44 60 48 60 Total renewal premiums 511 552 438 544 561 511 561 Group Retirement premiums by market $ 840 $ 910 $ 770 $ 1,013 $ 925 $ 840 $ 925 Account Values General Account: Balance as of beginning of period $ 11,619 $ 11,752 $ 11,892 $ 12,018 $ 12,071 $ 11,619 $ 12,071 Gross premiums 305 321 340 312 447 305 447 Surrenders, withdrawals and benefits (267) (264) (292) (346) (280) (267) (280) Net flows 38 57 48 (34) 167 38 167 Investment performance, interest credited and policy charges 95 83 78 87 19 95 19 Balance as of end of period $ 11,752 $ 11,892 $ 12,018 $ 12,071 $ 12,257 $ 11,752 $ 12,257 Separate Accounts: Balance as of beginning of period $ 20,782 $ 23,325 $ 24,165 $ 24,043 $ 25,809 $ 20,782 $ 25,809 Gross premiums 535 589 430 702 478 535 478 Surrenders, withdrawals and benefits (466) (482) (501) (649) (517) (466) (517) Net flows 69 107 (71) 53 (39) 69 (39) Investment performance, interest credited and policy charges 2,474 733 (51) 1,713 (4,879) 2,474 (4,879) Balance as of end of period $ 23,325 $ 24,165 $ 24,043 $ 25,809 $ 20,891 $ 23,325 $ 20,891 Total: Balance as of beginning of period $ 32,401 $ 35,077 $ 36,057 $ 36,061 $ 37,880 $ 32,401 $ 37,880 Gross premiums 840 910 770 1,014 925 840 925 Surrenders, withdrawals and benefits (733) (746) (793) (995) (797) (733) (797) Net flows 107 164 (23) 19 128 107 128 Investment performance, interest credited and policy charges 2,569 816 27 1,800 (4,860) 2,569 (4,860) Balance as of end of period $ 35,077 $ 36,057 $ 36,061 $ 37,880 $ 33,148 $ 35,077 $ 33,148 1Q 2020 Financial Supplement 15
Investment Management and Research - Operating Earnings (Loss) and Summary Metrics For the Three Months Ended or As of For the Three Months Ended or As of (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Change 3/31/2019 3/31/2020 Change Revenues Net investment income (loss) $ 24 $ 15 $ 5 $ 13 $ (33) (237.5)% $ 24 $ (33) (237.5)% Net derivative gains (losses) (20) (9) — (9) 30 250.0 % (20) 30 250.0 % Investment management, service fees and other income 776 842 867 975 910 17.3 % 776 910 17.3 % Segment Revenues 780 848 872 979 907 16.3 % 780 907 16.3 % Benefits and other deductions Commissions and distribution-related payments 106 116 128 138 140 32.1 % 106 140 32.1 % Compensation, benefits and other operating costs and expenses 509 547 542 576 558 9.6 % 509 558 9.6 % Interest expense and financing fees 4 3 2 1 2 (50.0)% 4 2 (50.0)% Total benefits and other deductions 619 666 672 715 700 13.1 % 619 700 13.1 % Operating earnings (loss), before income taxes 161 182 200 264 207 28.6 % 161 207 28.6 % Income taxes (29) (33) (38) (44) (37) (27.6)% (29) (37) (27.6)% Operating earnings (loss), before noncontrolling interest 132 149 162 220 170 28.8 % 132 170 28.8 % Less: Operating (earnings) loss attributable to the noncontrolling interest (55) (69) (69) (89) (75) (36.4)% (55) (75) (36.4)% Operating earnings (loss) $ 77 $ 80 $ 93 $ 131 $ 95 23.4 % $ 77 $ 95 23.4 % Summary Metrics Adjusted operating margin (1) 24.1% 25.1% 27.5% 32.3% 27.6% 24.1% 27.6% Net flows (in billions USD) $ 1.1 $ 9.5 $ 8.1 $ 6.5 $ (5.6) $ 1.1 $ (5.6) Total AUM (in billions USD) $ 554.7 $ 580.8 $ 592.4 $ 622.9 $ 541.8 $ 554.7 $ 541.8 Ownership Structure of AB Holdings and its subsidiaries 64.0% 63.7% 63.8% 63.3% 63.4% 64.0% 63.4% AB Holding 35.2% 35.6% 35.4% 36.0% 35.9% 35.2% 35.9% Unaffiliated holders 0.8% 0.7% 0.8% 0.7% 0.7% 0.8% 0.7% Total 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% EQH economic interest 65.6% 65.2% 65.3% 64.8% 64.9% 65.6% 64.9% EQH average economic interest 65.6% 65.2% 65.3% 65.2% 64.8% 65.6% 64.8% Units of limited partnership outstanding (in millions) 267.2 268.8 268.2 270.4 270.0 267.2 270.0 Notes: (1) Adjusted Operating Margin is a non-GAAP financial measure used by AllianceBernstein’s (“AB”) management in evaluating AB’s financial performance on a standalone basis and to compare its performance, as reported by AB in its public filings. It is not comparable to any other non-GAAP financial measure used herein. 1Q 2020 Financial Supplement 16
Investment Management and Research - Select Operating Metrics For the Three Months Ended or As of (in billions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 AUM Roll-forward Balance as of beginning of period $ 516.4 $ 554.7 $ 580.8 $ 592.4 $ 622.9 Sales/new accounts 23.1 27.3 26.3 27.0 31.6 Redemptions/terminations (18.2) (16.1) (18.6) (15.6) (32.7) Cash flow/unreinvested dividends (3.8) (1.7) 0.4 (4.9) (4.5) Net long-term (outflows) inflows 1.1 9.5 8.1 6.5 (5.6) Adjustments (1) — (0.9) — — 0.2 Market appreciation (depreciation) 37.2 17.5 3.5 24.0 (75.7) Net change 38.3 26.1 11.6 30.5 (81.1) Balance as of end of period $ 554.7 $ 580.8 $ 592.4 $ 622.9 $ 541.8 Ending Assets by distribution channel Institutions $ 256.6 $ 269.1 $ 272.9 $ 282.7 256.7 Retail 201.9 214.5 222.5 239.2 198.6 Private Wealth Management 96.2 97.2 97.0 101.0 86.5 Total $ 554.7 $ 580.8 $ 592.4 $ 622.9 $ 541.8 Ending Assets by investment service Equity Actively Managed $ 155.1 $ 161.8 $ 159.9 $ 177.2 141.5 Passively Managed (2) 55.8 57.4 56.8 60.1 47.2 Total Equity $ 210.9 $ 219.2 $ 216.7 $ 237.3 188.7 Fixed Income Actively Managed $ 271.0 $ 285.1 $ 298.7 $ 305.4 282.0 Passively Managed (2) 9.3 9.5 9.4 9.3 10.3 Total Fixed Income 280.3 294.6 308.1 314.7 292.3 Total Other (3) 63.5 67.0 67.6 70.9 60.8 Total $ 554.7 $ 580.8 $ 592.4 $ 622.9 541.8 Notes: (1) 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. (2) Includes index and enhanced index services. (3) Includes certain multi-asset solutions and services and certain alternative investments. 1Q 2020 Financial Supplement 17
Investment Management and Research - Net Flows For the Three Months Ended For the Three Months Ended (in billions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 3/31/2019 3/31/2020 Net Flows by Distribution Channel Institutions US $ (3.1) $ 1.0 $ 6.6 $ (1.1) $ 0.9 $ (3.1) $ 0.9 Global and Non-US (1.6) 3.2 (5.1) 2.5 (0.5) (1.6) (0.5) Total Institutions $ (4.7) $ 4.2 $ 1.5 $ 1.4 $ 0.4 $ (4.7) $ 0.4 Retail US $ 1.7 $ 0.5 $ 1.0 $ 1.7 $ (0.9) $ 1.7 $ (0.9) Global and Non-US 3.6 5.4 6.4 3.5 (4.5) 3.6 (4.5) Total Retail $ 5.3 $ 5.9 $ 7.4 $ 5.2 $ (5.4) $ 5.3 $ (5.4) Private Wealth US $ 0.1 $ (0.5) $ (0.6) $ 0.2 $ (0.4) $ 0.1 $ (0.4) Global and Non-US 0.4 (0.1) (0.2) (0.3) (0.2) 0.4 (0.2) Total Private Wealth $ 0.5 $ (0.6) $ (0.8) $ (0.1) $ (0.6) $ 0.5 $ (0.6) Total Net Flows by Distribution Channel $ 1.1 $ 9.5 $ 8.1 $ 6.5 $ (5.6) $ 1.1 $ (5.6) Net Flows by Investment Service Equity Active US $ (0.1) $ 0.5 $ 0.6 $ 1.1 $ (0.4) $ (0.1) $ (0.4) Global and Non-US 1.1 0.5 (2.0) 2.2 1.8 1.1 1.8 Total Equity Active $ 1.0 $ 1.0 $ (1.4) $ 3.3 $ 1.4 $ 1.0 $ 1.4 Equity Passive (1) US $ (0.7) $ (0.5) $ (0.9) $ (1.4) $ 0.1 $ (0.7) $ 0.1 Global and Non-US (0.1) (0.1) (0.2) (0.2) (1.4) (0.1) (1.4) Total Equity Passive (1) $ (0.8) $ (0.6) $ (1.1) $ (1.6) $ (1.3) $ (0.8) $ (1.3) Fixed Income - Taxable US $ (2.1) $ 0.9 $ 6.6 $ (0.1) $ 0.2 $ (2.1) $ 0.2 Global and Non-US 1.4 6.0 2.8 3.3 (6.6) 1.4 (6.6) Total Fixed Income - Taxable $ (0.7) $ 6.9 $ 9.4 $ 3.2 $ (6.4) $ (0.7) $ (6.4) Fixed Income - Tax-Exempt US $ 0.9 $ 0.1 $ 1.0 $ 1.0 $ — $ 0.9 $ — Global and Non-US — — — — — — — Total Fixed Income - Tax-Exempt $ 0.9 $ 0.1 $ 1.0 $ 1.0 $ — $ 0.9 $ — Fixed Income - Passive (1) US $ (0.1) $ (0.1) $ (0.1) $ (0.1) $ (0.2) $ (0.1) $ (0.2) Global and Non-US (0.3) (0.1) (0.1) (0.1) 0.9 (0.3) 0.9 Total Fixed Income - Passive (1) $ (0.4) $ (0.2) $ (0.2) $ (0.2) $ 0.7 $ (0.4) $ 0.7 Other (2) US $ 0.8 $ 0.1 $ (0.2) $ 0.3 $ (0.1) $ 0.8 $ (0.1) Global and Non-US 0.3 2.2 0.6 0.5 0.1 0.3 0.1 Total Other (2) $ 1.1 $ 2.3 $ 0.4 $ 0.8 $ — $ 1.1 $ — Total Net Flows by Investment Service $ 1.1 $ 9.5 $ 8.1 $ 6.5 $ (5.6) $ 1.1 $ (5.6) Active vs. Passive Net Flows Actively Managed Equity $ 1.0 $ 1.0 $ (1.4) $ 3.3 $ 1.4 $ 1.0 $ 1.4 Fixed Income 0.2 7.0 10.4 4.2 (6.4) 0.2 (6.4) Other (2) 1.0 2.2 0.3 0.6 (0.2) 1.0 (0.2) Total $ 2.2 $ 10.2 $ 9.3 $ 8.1 $ (5.2) $ 2.2 $ (5.2) Passively Managed (1) Equity $ (0.8) $ (0.6) $ (1.1) $ (1.6) $ (1.3) $ (0.8) $ (1.3) Fixed Income (3) (0.4) (0.2) (0.2) (0.2) 0.7 (0.4) 0.7 Other (2) 0.1 0.1 0.1 0.2 $ 0.2 0.1 $ 0.2 Total $ (1.1) $ (0.7) $ (1.2) $ (1.6) $ (0.4) $ (1.1) $ (0.4) Total Active vs Passive Net Flows $ 1.1 $ 9.5 $ 8.1 $ 6.5 $ (5.6) $ 1.1 $ (5.6) Notes: (1) Includes index and enhanced index services. (2) Includes certain multi-asset solutions and services and certain alternative investments. 1Q 2020 Financial Supplement 18
Protection Solutions - Operating Earnings (Loss) and Summary Metrics For the Three Months Ended or As of For the Three Months Ended or As of (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Change 3/31/2019 3/31/2020 Change Revenues Policy charges, fee income and premiums $ 542 $ 530 $ 503 $ 532 $ 557 2.8 % $ 542 $ 557 2.8 % Net investment income (loss) 224 248 242 253 244 8.9 % 224 244 8.9 % Net derivative gains (losses) 10 1 (1) — 2 (80.0)% 10 2 (80.0)% Investment management, service fees and other income 55 64 59 63 56 1.8 % 55 56 1.8 % Segment revenues 831 843 803 848 859 3.4 % 831 859 3.4 % Benefits and other deductions Policyholders’ benefits 452 419 355 377 502 11.1 % 452 502 11.1 % Interest credited to policyholders’ account balances 138 127 131 124 127 (8.0)% 138 127 (8.0)% Commissions and distribution-related payments 38 43 41 44 40 5.3 % 38 40 5.3 % Amortization of deferred policy acquisition costs 50 50 56 55 56 12.0 % 50 56 12.0 % Compensation and benefits, interest expense and financing fees and other operating costs and expense 95 75 84 92 88 (7.4)% 95 88 (7.4)% Segment benefits and other deductions 773 714 667 692 813 5.2 % 773 813 5.2 % Operating earnings (loss), before income taxes 58 129 136 156 46 (20.7)% 58 46 (20.7)% Income taxes (9) (23) (23) (28) (8) 11.1 % (9) (8) 11.1 % Operating earnings (loss), before noncontrolling interest 49 106 113 128 38 (22.4)% 49 38 (22.4)% Less: Operating (earnings) loss attributable to the noncontrolling interest — — — — — — % — — — % Operating earnings (loss) $ 49 $ 106 $ 113 $ 128 $ 38 (22.4)% $ 49 $ 38 (22.4)% Summary Metrics Operating earnings (loss) - TTM: [A] $ 211 $ 329 $ 305 $ 396 $ 385 N/M $ 211 $ 385 N/M Average capital - TTM: [B] $ 2,762 $ 2,870 $ 2,933 $ 2,995 $ 2,820 N/M $ 2,762 $ 2,820 N/M Non-GAAP Operating ROC - TTM (1): [A/B] 7.6% 11.5% 10.4% 13.2% 13.7% 7.6% 13.7% Benefit ratio 71.0% 64.8% 60.5% 59.1% 73.2% 71.0% 73.2% Gross written premiums $ 786 $ 746 $ 777 $ 790 $ 778 (1.0)% $ 786 $ 778 (1.0)% Annualized premiums $ 64 $ 63 $ 61 $ 70 $ 56 (11.7)% $ 64 $ 56 (11.7)% Total in-force face amount (in billions USD) $ 442.7 $ 442.7 $ 442.3 $ 441.5 $ 435.1 (1.7)% $ 442.7 $ 435.1 (1.7)% Notes: (1) This measure is a Non-GAAP financial measure. For an explanation of our use of Non-GAAP financial measures, refer to the “Use of Non-GAAP Financial Measures” and "Glossary of Selected Financial and Product Terms" sections of this document. 1Q 2020 Financial Supplement 19
Protection Solutions - Select Operating Metrics For the Three Months Ended or As of For the Three Months Ended or As of (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 3/31/2019 3/31/2020 Sales Metrics First Year Premiums by Product Line: Universal Life $ — $ — $ 1 $ 1 $ — $ — $ — Indexed Universal Life 46 50 51 56 49 46 49 Variable Universal Life 47 43 42 49 35 47 35 Term 5 5 5 5 4 5 4 Employee Benefits 13 15 13 11 11 13 11 Other (1) — — 1 — — — — Total $ 111 $ 113 $ 113 $ 122 $ 99 $ 111 $ 99 Renewals by Product Line: Universal Life $ 225 $ 218 $ 239 $ 212 $ 216 $ 225 $ 216 Indexed Universal Life 70 59 60 59 72 70 72 Variable Universal Life 241 222 221 237 243 241 243 Term 121 117 125 135 120 121 120 Employee Benefits 12 12 14 18 23 12 23 Other (1) 6 5 5 7 5 6 5 Total 675 633 664 668 679 675 679 Total Gross Premiums $ 786 $ 746 $ 777 $ 790 $ 778 $ 786 $ 778 In-force Metrics In-force Face Amount by Product (2) (in billions): Universal Life (3) $ 55.1 $ 54.5 $ 53.8 $ 53.3 $ 52.7 $ 55.1 $ 52.7 Indexed Universal Life 23.6 24.3 24.9 25.8 26.4 23.6 26.4 Variable Universal Life (4) 127.4 127.1 126.8 127.5 126.0 127.4 126.0 Term 235.1 235.4 235.4 233.5 228.7 235.1 228.7 Whole Life 1.5 1.4 1.4 1.4 1.3 1.5 1.3 Total $ 442.7 $ 442.7 $ 442.3 $ 441.5 $ 435.1 $ 442.7 $ 435.1 In-force Policy Count by Product (2) (in thousands): Universal Life (3) 174 173 171 170 164 174 164 Indexed Universal Life 53 54 54 55 60 53 60 Variable Universal Life (4) 305 302 300 299 296 305 296 Term 331 329 326 323 319 331 319 Whole Life 19 18 18 18 18 19 18 Total 882 876 870 865 857 882 857 Protection Solutions Reserves General Account $ 17,731 $ 17,716 $ 17,819 $ 17,298 $ 17,275 $ 17,731 $ 17,275 Separate Accounts 12,572 12,903 12,804 13,616 11,259 12,572 11,259 Total $ 30,303 $ 30,619 $ 30,623 $ 30,914 $ 28,534 $ 30,303 $ 28,534 Notes: (1) For the individual life insurance premiums, Other includes Whole Life insurance and other products available-for-sale but not actively marketed. (2) Includes individual life insurance and does not include Employee Benefits as it is a start-up business and therefore has immaterial in-force policies. (3) Universal Life includes Guaranteed Universal Life. (4) Variable Universal Life includes variable life insurance and corporate-owned life insurance. 1Q 2020 Financial Supplement 20
Investments 1Q 2020 Financial Supplement 21
Consolidated Investment Portfolio Composition Balances as of (in millions USD, unless otherwise indicated) December 31, 2019 March 31, 2020 Amount (1) % of Total Amount (1) % of Total Composition of investment portfolio Fixed maturities, available-for-sale, at fair value $ 66,343 67.9% $ 70,321 66.0% Mortgage loans on real estate 12,107 12.4% 12,123 11.4% Policy loans 3,735 3.8% 3,720 3.5% Other equity investments 1,344 1.4% 1,406 1.3% Other invested assets 2,780 2.8% 2,112 2.0% Subtotal investment assets 86,309 88.3% 89,682 84.2% Trading securities 7,031 7.2% 6,534 6.1% Total investments 93,340 95.5% 96,216 90.3% Cash and cash equivalents 4,405 4.5% 10,315 9.7% Total $ 97,745 100.0% $ 106,531 100.0% General Account Fixed maturities by industry (Based on amortized cost) Corporate securities: Finance $ 12,015 19.2% $ 13,134 20.3% Manufacturing 12,643 20.2% 12,899 19.9% Utilities 4,999 8.0% 5,191 8.0% Services 6,730 10.7% 6,447 9.9% Energy 3,772 6.0% 3,909 6.0% Retail and wholesale 3,515 5.6% 3,643 5.6% Transportation 1,793 2.9% 1,819 2.8% Other 198 0.3% 154 0.2% Total corporate securities 45,665 72.8% 47,196 72.8% U.S. government and agency 14,395 23.0% 14,211 21.9% Residential mortgage-backed (2) 178 0.3% 170 0.3% Preferred stock 501 0.8% 545 0.8% State & municipal 638 1.0% 661 1.0% Foreign governments 462 0.7% 483 0.7% Commercial mortgage-backed — —% 37 0.1% Asset-backed securities 848 1.4% 1,514 2.3% Total $ 62,687 100.0% $ 64,817 100.0% General Account Fixed maturities credit quality (3) (Based on amortized cost) Aaa, Aa, A (NAIC Designation 1) $ 42,770 68.2% $ 42,890 66.2% Baa (NAIC Designation 2) 18,605 29.7% 20,310 31.3% Investment grade 61,375 97.9% 63,200 97.5% Below investment grade (NAIC Designation 3,4,5 and 6) 1,312 2.1% 1,617 2.5% Total $ 62,687 100.0% $ 64,817 100.0% Notes: (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) Credit quality based on NAIC rating. 1Q 2020 Financial Supplement 22
Consolidated Results of General Account Investment Portfolio For the Three Months Ended or As of Years Ended or As of (in millions USD, unless otherwise indicated) March 31, 2019 March 31, 2020 December 31, 2019 Yield Amount (1) Yield Amount (1) Yield Amount (1) Fixed Maturities: Income (loss) 3.65 % $ 435 3.59 % $ 573 3.68 % $ 2,019 Ending assets 48,767 64,815 62,687 Mortgages: Income (loss) 4.41 % 132 4.22 % 128 4.47 % 541 Ending assets 12,117 12,123 12,107 Other Equity Investments: Income (loss) 4.27 % 15 7.42 % 28 6.33 % 86 Ending assets 1,404 1,556 1,507 Policy Loans: Income 5.62 % 53 5.57 % 52 5.59 % 210 Ending assets 3,766 3,720 3,735 Cash and Short-term Investments: Income — % — (1.35)% (16) (0.15)% (4) Ending assets 3,243 7,552 1,856 Repurchase and Funding Agreements: Interest expense and other (25) (29) (110) Ending (liabilities) (4,001) (6,759) (6,909) Total invested Assets: Income 3.83 % 610 3.73 % 736 3.92 % 2,742 Ending assets 65,296 83,007 74,983 Short Duration Fixed Maturities: Income (loss) 2.98 % 101 3.60 % 52 3.15 % 312 Ending assets 12,262 5,729 6,173 Total Net Investment Income: Investment income 3.68 % 711 3.72 % 788 3.83 % 3,054 Less: investment fees (0.08)% (16) (0.12)% (25) (0.08)% (66) Investment income, net 3.60 % $ 695 3.60 % $ 763 3.75 % $ 2,988 General Account Ending Net Assets $ 77,558 $ 88,736 $ 81,156 Operating Earnings adjustments: Repurchase and Funding Agreements interest expense 25 29 110 AB and other non-General Account investment income 66 587 204 Operating Net investment income (loss) $ 786 $ 1,379 $ 3,302 Notes: (1) Amount for fixed maturities and mortgages represents original cost, reduced by repayments, writedowns, adjusted amortization of premiums, accretion of discount, and for valuation allowances. Cost for equity securities represents original cost reduced by writedowns; cost for other limited partnership interests represents original cost adjusted for equity in earnings and reduced by distributions. 1Q 2020 Financial Supplement 23
Additional Information 1Q 2020 Financial Supplement 24
Deferred Policy Acquisition Costs Rollforward For the Three Months Ended or As of For the Three Months Ended or As of (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 3/31/2019 3/31/2020 TOTAL Beginning balance (1) $ 6,745 $ 6,018 $ 6,080 $ 5,787 $ 5,893 $ 6,745 $ 5,893 Capitalization of commissions, sales and issue expenses 173 189 182 210 185 173 185 Amortization (198) (177) (85) (119) (1,248) (198) (1,248) Change in unrealized investment gains and losses (702) 50 (390) 43 (22) (702) (22) Reclassified to Assets held-for-sale — — — (31) 1 — 1 Ending balance $ 6,018 $ 6,080 $ 5,787 $ 5,890 $ 4,809 $ 6,018 $ 4,809 Individual Retirement Beginning balance $ 3,229 $ 3,212 $ 3,191 $ 3,241 $ 3,275 $ 3,229 $ 3,275 Capitalization of commissions, sales and issue expenses 100 116 111 123 111 100 111 Amortization (144) (115) (23) (45) (100) (144) (100) Change in unrealized investment gains and losses 27 (22) (38) (44) 118 27 118 Reclassified to Assets held-for-sale — — — — — — — Ending balance $ 3,212 $ 3,191 $ 3,241 $ 3,275 $ 3,404 $ 3,212 $ 3,404 Group Retirement Beginning balance $ 657 $ 650 $ 664 $ 674 $ 667 $ 657 $ 667 Capitalization of commissions, sales and issue expenses 23 26 22 31 26 23 26 Amortization (12) (10) (7) (9) (59) (12) (59) Change in unrealized investment gains and losses (18) (2) (5) (29) (9) (18) (9) Reclassified to Assets held-for-sale — — — — — — — Ending balance $ 650 $ 664 $ 674 $ 667 $ 625 $ 650 $ 625 Protection Solutions Beginning balance $ 2,706 $ 2,061 $ 2,185 $ 1,856 $ 1,935 $ 2,706 $ 1,935 Capitalization of commissions, sales and issue expenses 50 47 49 57 48 50 48 Amortization (49) (50) (56) (55) (1,087) (49) (1,087) Change in unrealized investment gains and losses (646) 127 (322) 108 (177) (646) (177) Reclassified to Assets held-for-sale — — — (31) — — — Ending balance $ 2,061 $ 2,185 $ 1,856 $ 1,935 $ 719 $ 2,061 $ 719 Corporate and Other Beginning balance (1) $ 153 $ 95 $ 40 $ 16 $ 16 $ 153 $ 16 Capitalization of commissions, sales and issue expenses — — — (1) — — — Amortization 7 (2) 1 (10) (2) 7 (2) Change in unrealized investment gains and losses (65) (53) (25) 8 46 (65) 46 Reclassified to Assets held-for-sale — — — — 1 — 1 Ending balance $ 95 $ 40 $ 16 $ 13 $ 61 $ 95 $ 61 (1) March 31, 2020 DAC beginning balance is $3 million more than December 31, 2019 ending balance due to impact of CECL. 1Q 2020 Financial Supplement 25
Use of Non-GAAP Financial Measures In addition to our results presented in accordance with U.S. GAAP, we report Non-GAAP Operating Earnings, Non-GAAP Operating ROE, Non-GAAP Operating ROC by segment for our Individual Retirement, Group Retirement and Protection Solutions segments, and Non-GAAP Operating Earnings per share, each of which is a measure that is not determined in accordance with U.S. GAAP. Management principally uses these non-GAAP financial measures in evaluating performance because they present a clearer picture of our operating performance and they allow management to allocate resources. Similarly, management believes that the use of these Non-GAAP financial measures, together with relevant U.S. GAAP measures, provide investors with a better understanding of our results of operations and the underlying profitability drivers and trends of our business. These non-GAAP financial measures are intended to remove from our results of operations the impact of market changes (where there is mismatch in the valuation of assets and liabilities) as well as certain other expenses which are not part of our underlying profitability drivers or likely to re-occur in the foreseeable future, as such items fluctuate from period-to-period in a manner inconsistent with these drivers. These measures should be considered supplementary to our results that are presented in accordance with U.S. GAAP and should not be viewed as a substitute for the U.S. GAAP measures. Other companies may use similarly titled non-GAAP financial measures that are calculated differently from the way we calculate such measures. Consequently, our non-GAAP financial measures may not be comparable to similar measures used by other companies. We also discuss certain operating measures, including AUM, AUA, AV, Protection Solutions Reserves and certain other operating measures, which management believes provide useful information about our businesses and the operational factors underlying our financial performance. Non-GAAP Operating Earnings Non-GAAP Operating Earnings is an after-tax non-GAAP financial measure used to evaluate our financial performance on a consolidated basis that is determined by making certain adjustments to our consolidated after-tax net income attributable to Holdings. The most significant of such adjustments relates to our derivative positions, which protect economic value and statutory capital, and are more sensitive to changes in market conditions than the variable annuity product liabilities as valued under U.S. GAAP. This is a large source of volatility in net income. Non-GAAP Operating Earnings equals our consolidated after-tax net income attributable to Holdings adjusted to eliminate the impact of the following items: • Items related to variable annuity product features, which include: (i) certain changes in the fair value of the derivatives and other securities we use to hedge these features; (ii) the effect of benefit ratio unlock adjustments related to extraordinary economic conditions or events such as COVID-19; and (iii) 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 credit loss impairments of securities/investments, sales or disposals of securities/investments, realized capital gains/losses and valuation allowances; • 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, separation costs and impacts related to COVID-19; 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 and permanent differences due to the Tax Reform Act. Because Non-GAAP Operating Earnings excludes the foregoing items that can be distortive or unpredictable, management believes that this measure enhances the understanding of the Company’s underlying drivers of profitability and trends in our business, thereby allowing management to make decisions that will positively impact our business. We use the prevailing corporate federal income tax rate of 21% in 2020 while taking into account any non-recurring differences for events recognized differently in our financial statements and federal income tax returns as well as partnership income taxed at lower rates when reconciling Net income (loss) attributable to Holdings to Non-GAAP Operating Earnings. 1Q 2020 Financial Supplement 26
Use of Non-GAAP Financial Measures Non-GAAP Operating ROE, Pro forma Non-GAAP Operating ROE and Non-GAAP Operating ROC by Segment We report Non-GAAP Operating ROE, Pro forma Non-GAAP Operating ROE as well as Non-GAAP Operating ROC by segment for our Individual Retirement, Group Retirement and Protection Solutions segments, each of which is a non-GAAP financial measure used to evaluate our recurrent profitability on a consolidated basis and by segment, respectively. We calculate Non- GAAP Operating ROE by dividing Non-GAAP Operating Earnings for the previous twelve calendar months by consolidated average equity attributable to Holdings' common shareholders, excluding Accumulated Other Comprehensive Income (“AOCI”). We calculate Pro forma Non-GAAP Operating ROE by dividing Pro forma Non-GAAP Operating Earnings by consolidated average equity attributable to Holdings' common shareholders, excluding AOCI. We calculate Non-GAAP Operating ROC by segment by dividing Operating earnings (loss) on a segment basis for the previous twelve calendar months by average capital on a segment basis, excluding AOCI, as described below. AOCI fluctuates period-to-period in a manner inconsistent with our underlying profitability drivers as the majority of such fluctuation is related to the market volatility of the unrealized gains and losses associated with our available-for-sale (“AFS”) securities. Therefore, we believe excluding AOCI is more effective for analyzing the trends of our operations. We do not calculate Non-GAAP Operating ROC by segment for our Investment Management & Research segment because we do not manage that segment from a return of capital perspective. Instead, we use metrics more directly applicable to an asset management business, such as AUM, to evaluate and manage that segment. For Non-GAAP Operating ROC 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, reflecting the new adopted NAIC RBC framework the company as of year end 2019. To enhance the ability to analyze these measures across periods, interim periods are annualized. Non-GAAP Operating ROC by segment should not be used as a substitute for ROE. Book Value per common share, excluding AOCI We use the term “book value” to refer to “Total equity attributable to Holdings' common shareholders.” Book Value per common share, excluding AOCI, is our stockholder’s equity, excluding AOCI, divided by ending common shares outstanding. Non-GAAP Operating Earnings per common share Non-GAAP Operating Earnings per common share is calculated by dividing Non-GAAP Operating Earnings by diluted common shares outstanding. 1Q 2020 Financial Supplement 27
Reconciliation of Non-GAAP Measures (1/3) For the Three Months Ended or As of For the Three Months Ended or As of (in millions USD, unless otherwise indicated) 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 3/31/2019 3/31/2020 Net income (loss) attributable to Holdings Net income (loss) attributable to Holdings $ (775) $ 363 $ (384) $ (937) $ 5,410 $ (775) $ 5,410 Adjustments related to: Variable annuity product features (1) 1,540 200 1,444 1,694 (6,861) 1,540 (6,861) Investment gains (losses), net 11 12 (199) 103 (4) 11 (4) Net actuarial gains (losses) related to pension and other postretirement benefit obligations 24 24 24 27 27 24 27 Other adjustments (2) (3) 40 89 78 199 634 40 634 Income tax (expense) benefit related to above adjustments (4) (337) (71) (282) (424) 1,303 (337) 1,303 Non-recurring tax items 6 (58) (4) (10) 6 6 6 Non-GAAP Operating Earnings $ 509 $ 559 $ 677 $ 652 $ 515 $ 509 $ 515 Net income (loss) attributable to Holdings $ (1.50) $ 0.74 $ (0.78) $ (1.97) $ 11.67 $ (1.50) $ 11.67 Less: Preferred stock dividends — — — — 0.02 — 0.02 Net income (loss) available to Holdings' common shareholders (1.50) 0.74 (0.78) (1.97) 11.65 (1.50) 11.65 Adjustments related to: Variable annuity product features (1) 2.97 0.41 2.94 3.55 (14.80) 2.97 (14.80) Investment gains (losses), net 0.02 0.02 (0.40) 0.22 (0.01) 0.02 (0.01) Net actuarial gains (losses) related to pension and other postretirement benefit obligations 0.05 0.05 0.05 0.06 0.06 0.05 0.06 Other adjustments (2) (3) 0.08 0.18 0.15 0.42 1.37 0.08 1.36 Income tax (expense) benefit related to above adjustments (4) (0.65) (0.14) (0.57) (0.89) 2.81 (0.65) 2.81 Non-recurring tax items 0.01 (0.12) (0.01) (0.02) 0.01 0.01 0.01 Non-GAAP Operating Earnings (loss) available to Holdings' common shareholders $ 0.98 $ 1.14 $ 1.38 $ 1.37 $ 1.08 $ 0.98 $ 1.08 Book Value per common share Book Value per common share $ 26.77 $ 30.22 $ 30.53 $ 27.52 $ 42.86 $ 26.77 $ 42.86 Less: Per share impact of AOCI (1.04) 1.78 3.00 1.81 5.08 (1.04) 5.08 Book value per common share (ex. AOCI) $ 27.81 $ 28.44 $ 27.53 $ 25.71 $ 37.78 $ 27.81 $ 37.78 Notes: 561.0 561.0 561.0 561.1 560.3 561.0 560.8 (1) Includes COVID-19 impact on Variable annuity product features due to assumption update of $1.5 billion and other COVID-19 related impacts of $35 million for the three months ended March 31, 2020. The impact per common share is $3.17 and other COVID-19 related impacts of $0.08 for the three months ended March 31, 2020. (2) Includes separation costs of $32 million and $24 million for the three months ended March 31, 2020 and 2019. The impact per common share is $0.07 and $0.05 for the three months ended March 31, 2020 and 2019. (3) Includes assumption update due to COVID-19 of $1.0 billion and other COVID-19 related impacts of $51 million for the three months ended March 31, 2020. The impact per common share is $2.13 and $0.11 for the three months ended March 31, 2020. (4) Includes income taxes of $(534) million for the above related COVID-19 items for the three months ended March 31, 2020. The impact per common share is $(1.15) for the three months ended March 31, 2020. 1Q 2020 Financial Supplement 28
Reconciliation of Non-GAAP Measures (2/3) As of and for the Twelve Months Ended 3/31/2019 (in millions USD, unless otherwise indicated) Pro forma (1) 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Net Income to Pro forma Net Income Net Income (loss), as reported $ 1,108 $ — $ — $ — $ — Adjustments related to: Pro forma adjustments before income tax (1) (6) — — — — Income tax impact (1) — — — — Pro forma adjustments, net of income tax (7) — — — — Pro forma Net income (loss) 1,101 — — — — Less: Pro forma net income (loss) attributable to the noncontrolling interest (270) — — — — Pro forma Net income (loss) attributable to Holdings $ 831 $ — $ — $ — $ — Net Income to Non-GAAP Operating Earnings Net income (loss) attributable to Holdings $ 831 $ 1,030 $ 1,142 $ (1,733) $ 4,452 Adjustments related to: Variable annuity product features 1,295 1,245 1,286 4,878 (3,523) Investment (gains) losses 201 189 (46) (73) (88) Net actuarial (gains) losses related to pension and other postretirement benefit obligations 107 105 105 99 102 Other adjustments 244 249 276 406 1,000 Income tax (expense) benefits related to above adjustments (396) (389) (340) (1,114) 526 Non-recurring tax items (94) (164) (174) (66) (66) Non-GAAP Operating Earnings $ 2,188 $ 2,265 $ 2,249 $ 2,397 $ 2,403 Return on Equity and Non-GAAP Operating Return on Equity - Trailing twelve months Net income (loss) attributable to Holdings 831 1,030 1,142 (1,733) 4,452 Less: Preferred stock — — — — (13) Net income (loss) available to Holdings' common shareholders $ 831 $ 1,030 $ 1,142 $ (1,733) $ 4,439 Average equity attributable to Holdings' common shareholders (ex. AOCI) $ 14,400 $ 14,223 $ 14,088 $ 13,253 $ 14,094 Return on Equity (ex. AOCI) 5.8% 7.2% 8.1% (13.1)% 31.5% Pro forma Non-GAAP Operating Earnings $ 2,188 $ 2,265 $ 2,249 $ 2,397 $ 2,403 Less: Preferred stock — — — — (13) Non-GAAP Operating Earnings available to Holdings' common shareholders $ 2,188 $ 2,265 $ 2,249 $ 2,397 $ 2,390 Average equity attributable to Holdings' common shareholders (ex. AOCI) $ 14,400 $ 14,223 $ 14,088 $ 13,253 $ 14,094 Non-GAAP Operating Return on Equity (ex. AOCI) 15.2% 15.9% 16.0% 18.1 % 17.0% Notes: (1) Pro forma adjustments relate to certain Reorganization transactions that occurred in 2018, including: (a) the acquisition of AXA’s remaining interest in AB and minority interests in AXA Financial, Inc.; (b) the transfer of certain U.S. property & casualty business held by Equitable Holdings to AXA; (c) the issuance of $3.8 billion of external debt; and (d) the settlement of all outstanding financing balances with AXA. 1Q 2020 Financial Supplement 29
Reconciliation of Non-GAAP Measures (3/3) Balances as of (in millions USD, unless otherwise indicated) 6/30/2018 9/30/2018 12/31/2018 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Equity Reconciliation - Quarter-end Balances Total equity attributable to Holdings' shareholders $ 13,364 $ 12,411 $ 13,866 $ 13,143 $ — $ — $ — $ — Less: Preferred Stock — — — — — — 775 775 Total equity attributable to Holdings' common shareholders 13,364 12,411 13,866 13,143 14,843 14,936 12,760 19,311 Less: Accumulated other comprehensive income (loss) (1,310) (1,595) (1,396) (513) 876 1,468 840 2,289 Total equity attributable to Holdings' common shareholders (ex. AOCI) $ 14,674 $ 14,006 $ 15,262 $ 13,656 $ 13,967 $ 13,468 $ 11,920 $ 17,022 Pro forma (1) Balances as of Balances as of (in millions USD, unless otherwise indicated) 6/30/2018 9/30/2018 12/31/2018 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 Equity Reconciliation - Twelve Month Rolling Average (2) Total equity attributable to Holdings' shareholders $ 13,182 $ 13,186 $ 13,297 $ 13,196 $ — $ — $ — $ — Pro forma adjustments (1) 399 176 1 — — — — — Total equity attributable to Holdings' shareholders 13,582 13,362 13,298 13,196 13,566 14,197 14,114 15,850 Less: Preferred Stock — — — — — — 194 388 Total equity attributable to Holdings' common shareholders 13,582 13,362 13,298 13,196 13,566 14,197 13,921 15,463 Less: Accumulated other comprehensive income (loss) (677) (990) (1,312) (1,204) (657) 109 668 1,368 Total equity attributable to Holdings' common shareholders (ex. AOCI) $ 14,259 $ 14,352 $ 14,610 $ 14,400 $ 14,223 $ 14,088 $ 13,253 $ 14,094 Notes: (1) Pro forma adjustments relate to certain Reorganization transactions that occurred in 2018, including: (a) the acquisition of AXA’s remaining interest in AB and minority interests in AXA Financial, Inc.; (b) the transfer of certain U.S. property & casualty business held by Equitable Holdings to AXA; (c) the issuance of $3.8 billion of external debt; and (d) the settlement of all outstanding financing balances with AXA. (2) All Pro forma average equity amounts are calculated based on a four-quarter rolling average. 1Q 2020 Financial Supplement 30
Glossary of Selected Financial and Product Terms Account Value (“AV”) - 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. Annualized premiums - 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 Administration (“AUA”) - 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. Assets Under Management (“AUM”) - AUM means investment assets that are managed by one of our subsidiaries and includes: (i) assets managed by AB; (ii) the assets in our General Account investment portfolio; and (iii) the Separate Account assets of our Individual Retirement, Group Retirement and Protection Solutions businesses. Total AUM reflects exclusions between segments to avoid double counting. Average Account Value - Calculated as the sum of total Account Value balance as of beginning of period and total Account Value balance as of end of period, divided by two. Average Capital - 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). 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. Current Product Offering (Individual Retirement) - Products sold 2011 and later. Deferred policy acquisition costs (“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. 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. Equitable America - means Equitable Financial Life Insurance Company of America, an Arizona corporation and a wholly-owned indirect subsidiary of Holdings. Equitable Life - means AXA Equitable Life Insurance Company, a New York corporation, a life insurance company and a wholly-owned subsidiary of AEFS. Fixed Rate (Individual Retirement) - Pre-2011 GMxB products. FYP - First year premium and deposits. GMxB - A general reference to all forms of variable annuity guaranteed benefits, including guaranteed minimum living benefits, or GMLBs (such as GMIBs, GMWBs and GMABs), and guaranteed minimum death benefits, or GMDBs (inclusive of return of premium death benefit guarantees). Gross premiums - FYP and Renewal premium and deposits. 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). Invested assets - Includes fixed maturity securities, equity securities, mortgage loans, policy loans, alternative investments and short-term investments. Inv Mgmt and Research - Abbreviation for Investment Management and Research. 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. Net long-term flows - Net change of assets under management in a period which includes new sales net of redemptions of mutual funds and terminations of separately managed accounts and cash flow which includes both cash invested or withdrawn by existing clients. In addition, cash flow includes fees received from certain clients. It excludes the impact of the markets. Premiums 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 Benefit Ratio - Calculated as sum of policyholders’ benefits and interest credited to policyholders’ account balances dividend by segment revenues. Protection Solutions Reserves - Protection Solutions Reserves equals the aggregate value of Policyholders’ account balances and Future policy benefits for policies in our Protection Solutions segment. Renewal premium and deposits - Premiums and deposits after the first twelve months of the policy or contract. 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. Return on Assets - Calculated as trailing twelve months operating earnings, before income taxes divided by average account value. Return on Equity (ex. AOCI) - Calculated as trailing twelve months net income (loss) attributable to Holdings' common shareholders divided by average equity attributable to Holdings' common shareholders, excluding Accumulated Other Comprehensive Income (“AOCI”). Trailing Twelve Months ("TTM") - The twelve calendar months preceding the balance sheet date of a given reporting period. 1Q 2020 Financial Supplement 31
Analyst Coverage, Ratings & Contact Information Analyst Coverage Firm Analyst Phone Number Bank of America Securities Joshua Shanker 1 (631) 909-4041 Citi Suneet Kamath 1 (212) 816-3457 Credit Suisse Andrew Kligerman 1 (212) 325-5069 Evercore ISI Thomas Gallagher 1 (212) 446-9439 Goldman Sachs Alex Scott 1 (917) 343-7160 J.P. Morgan Jimmy Bhullar 1 (212) 622-6397 Keefe, Bruyette, & Woods Ryan Krueger 1 (860) 722-5930 Morgan Stanley Nigel Dally 1 (212) 761-4132 RBC Capital Markets Mark Dwelle 1 (804) 782-4008 SunTrust Robinson Humphrey Mark Hughes 1 (615) 748-4422 Wells Fargo Securities Elyse Greenspan 1 (212) 214-8031 This list is provided for informational purposes only. Equitable Holdings does not endorse the analyses, conclusions or recommendations contained in any reports issued by these or any other analysts. Ratings A.M. Best S&P Moody’s Last review date Dec '19 Nov '19 Aug '19 Financial Strength Ratings: AXA Equitable Life Insurance Company A A+ A2 Equitable Financial Life Insurance Company of America A A+ A2 Credit Ratings: Equitable Holdings, Inc. bbb+ BBB+ Baa2 AllianceBernstein Holding, L.P. (1) — A A2 Investor and Media Contacts Contact Investor Relations Contact Media Relations Jessica Baehr Dan Woodrow Matt Asensio (212) 314-2476 (212) 314-2036 (212) 314-2010 IR@equitable.com MediaRelations@equitable.com ir.equitableholdings.com www.equitableholdings.com Notes: (1) Last review dates: S&P as of Oct '19, Moody’s as of Nov '19. 1Q 2020 Financial Supplement 32