0000727920us-gaap:CorporateNonSegmentMemberefl:HealthMember2023-01-012023-03-31

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

———————————————

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 000-20501

————————————————

Equitable Financial Life Insurance Company

(Exact name of registrant as specified in its charter)


New York						13-5570651
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

1290 Avenue of the Americas, New York, New York 10104

(Address of principal executive offices) (Zip Code)

(212) 554-1234

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an “emerging growth company”. See definition of “accelerated filer,” “large accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated filer

☐

Non-accelerated filer

☒

Smaller reporting company

☐

Emerging growth company

☐

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. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐No ☒

As of May 4, 2023, 2,000,000 shares of the registrant’s Common Stock , $1.25 par value were outstanding, all of which were owned indirectly by Equitable Holdings, Inc.

REDUCED DISCLOSURE FORMAT

Equitable Financial Life Insurance Company meets the conditions set forth in General Instruction (H)(1)(a) and (b) of Form 10-Q and is therefore filing this Form with the reduced disclosure format.

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TABLE OF CONTENTS


		Page
PART I - FINANCIAL INFORMATION
Item 1.	Consolidated Financial Statements (Unaudited)
	Consolidated Balance Sheets, March 31, 2023 and December 31, 2022	5
	Consolidated Statements of Income (Loss), Three Months Ended March 31, 2023 and 2022	7
	Consolidated Statements of Comprehensive Income (Loss), Three Months Ended March 31, 2023 and 2022	8
	Consolidated Statements of Equity, Three Months Ended March 31, 2023 and 2022	9
	Consolidated Statements of Cash Flows, Three Months Ended March 31, 2023 and 2022	10
	Notes to Consolidated Financial Statements:
	Note 1 - Organization	12
	Note 2 - Significant Accounting Policies	12
	Note 3 - Investments	20
	Note 4 - Derivatives	31
	Note 5 - Closed Block	37
	Note 6 - DAC and Other Deferred Assets/Liabilities	38
	Note 7 - Fair Value Disclosures	40
	Note 8 - Liabilities for Future Policyholder Benefits	52
	Note 9 - Market Risk Benefits	57


	Note 10 - Policyholder Account Balances	59
	Note 11 - Income Taxes	64

	Note 12 - Related Party Transactions	65
	Note 13 - Equity	65
	Note 14 - Redeemable Noncontrolling Interest	66
	Note 15 - Commitments and Contingent Liabilities	66
	Note 1 6 - Insurance Group Statutory Financial Information	69
	Note 17 - Reinsurance	70

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	73
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	82
Item 4.	Controls and Procedures	82

PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	83
Item 1A.	Risk Factors	83
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	83
Item 3.	Defaults Upon Senior Securities	83
Item 4.	Mine Safety Disclosures	83
Item 5.	Other Information	83
Item 6.	Exhibits	83

Signatures		88

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NOTE REGARDING FORWARD-LOOKING STATEMENTS AND INFORMATION

Certain of the statements included or incorporated by reference in this Quarterly Report on Form 10-Q constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “expects,” “believes,” “anticipates,” “intends,” “seeks,” “aims,” “plans,” “assumes,” “estimates,” “projects,” “should,” “would,” “could,” “may,” “will,” “shall” or variations of such words are generally part of forward-looking statements. Forward-looking statements are made based on management’s current expectations and beliefs concerning future developments and their potential effects upon Equitable Financial Life Insurance Company (“Equitable Financial”) and its consolidated subsidiaries. “We,” “us” and “our” refer to Equitable Financial and its consolidated subsidiaries, unless the context refers only to Equitable Financial as a corporate entity. There can be no assurance that future developments affecting Equitable Financial will be those anticipated by management. Forward-looking statements include, without limitation, all matters that are not historical facts.

These forward-looking statements are not a guarantee of future performance and involve risks and uncertainties, and there are certain important factors that could cause actual results to differ, possibly materially, from expectations or estimates reflected in such forward-looking statements, including, among others: (i) conditions in the financial markets and economy, including the impact of plateauing or decreasing economic growth and geopolitical conflicts and related economic conditions, equity market declines and volatility, interest rate fluctuations, impacts on our goodwill and changes in liquidity and access to and cost of capital; (ii) operational factors, indebtedness, protection of confidential customer information or proprietary business information, operational failures by us or our service providers, potential strategic transactions, and changes in accounting standards, and catastrophic events, such as the outbreak of pandemic diseases including COVID-19 ; (iii) credit, counterparties and investments, including counterparty default on derivative contracts, failure of financial institutions, defaults by third parties and affiliates and economic downturns, defaults and other events adversely affecting our investments; (iv) our reinsurance and hedging programs; (v) our products, structure and product distribution, including variable annuity guaranteed benefits features within certain of our products, variations in statutory capital requirements, financial strength and claims-paying ratings and key product distribution relationships; (vi) estimates, assumptions and valuations, including risk management policies and procedures, potential inadequacy of reserves and experience differing from pricing expectations or reserves, amortization of deferred acquisition costs and financial models; (vii) recruitment and retention of key employees at Equitable Financial and experienced and productive financial professionals; (viii) subjectivity of the determination of the amount of allowances and impairments taken on our investments; (ix) legal and regulatory risks, including federal and state legislation affecting financial institutions, insurance regulation and tax reform; and (x) general risks, including strong industry competition, information systems failing or being compromised and protecting our intellectual property.

Forward-looking statements should be read in conjunction with the other cautionary statements, risks, uncertainties and other factors identified in Equitable Financial’s Annual Report on Form 10-K for the year ended December 31, 2022, as amended or supplemented in our subsequently filed Quarterly Reports on Form 10-Q, including in the section entitled “Risk Factors,” and elsewhere in this Quarterly Report on Form 10-Q. You should read this Form 10-Q completely and with the understanding that actual future results may be materially different from expectations. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by law.

Other risks, uncertainties and factors, including those discussed under “Risk Factors”, in our Annual Report on Form 10-K could cause our actual results to differ materially from those projected in any forward-looking statements we make. Readers should read carefully the factors described in “Risk Factors” in our Annual Report on Form 10-K to better understand the risks and uncertainties inherent in our business and underlying any forward-looking statements.

Throughout this Quarterly Report on Form 10-Q we use certain defined terms and abbreviations, which are summarized in the “Glossary” and “Acronyms” sections.

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Part I FINANCIAL INFORMATION

Item 1.Consolidated Financial Statements (Unaudited)

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Consolidated Balance Sheets

March 31, 2023 and December 31, 2022 (Unaudited)



	March 31, 2023		December 31, 2022
	(in millions, except share data)
ASSETS
Investments:
Fixed maturities available-for-sale, at fair value (amortized cost of $67,353 and $68,087) (allowance for credit losses of $18 and $24)	$	59,726	$	58,947
Mortgage loans on real estate (net of allowance for credit losses of $139 and $129)	16,952		16,464
Policy loans	3,556		3,563
Other equity investments (1)	2,982		2,942
Trading securities, at fair value	292		283
Other invested assets	3,121		2,835
Total investments	86,629		85,034
Cash and cash equivalents	1,756		797
Deferred policy acquisition costs	4,817		4,814
Amounts due from reinsurers (allowance for credit losses of $0 and $10) (3)	7,136		7,131
Loans to affiliates	1,900		1,900
Current and deferred income taxes	1,857		1,376
Purchased market risk benefits	10,743		10,490
Other assets	3,491		3,917
Assets for market risk benefits	612		478
Separate Accounts assets	115,885		111,479
Total Assets	$	234,826	$	227,416

LIABILITIES
Policyholders’ account balances	$	81,497	$	79,742
Liability for market risk benefits	15,047		15,751
Future policy benefits and other policyholders' liabilities	16,033		15,935
Broker-dealer related payables	321		95

Amounts due to reinsurers	184		282



Other liabilities	4,612		5,185
Separate Accounts liabilities	115,885		111,479
Total Liabilities	$	233,579	$	228,469
Redeemable noncontrolling interest (2)	$	19	$	21
Commitments and contingent liabilities (4)

EQUITY
Equity attributable to Equitable Financial:
Common stock, $1.25 par value; 2,000,000 shares authorized, issued and outstanding	$	2	$	2
Additional paid-in capital	8,524		8,536
Accumulated deficit	(1,776)		(1,757)
Accumulated other comprehensive income (loss)	(5,522)		(7,855)
Total equity attributable to Equitable Financial	1,228		(1,074)
Noncontrolling interest	—		—
Total Equity	1,228		(1,074)
Total Liabilities, Redeemable Noncontrolling Interest and Equity	$	234,826	$	227,416

______________

(1)See Note 2 of the Notes to these Consolidated Financial Statements for details of balances with VIEs.

(2)See Note 14 of the Notes to these Consolidated Financial Statements for details of redeemable noncontrolling interest.

(3)Represents the fair value of the ceded reserves to Venerable. See Note 1 of the Notes to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 for details of the Venerable Transaction and Note 7 of the Notes to these Consolidated Financial Statements.

(4)See Note 15 of the Notes to these Consolidated Financial Statements for details of commitments and contingent liabilities.

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Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Consolidated Statements of Income (Loss)

Three Months Ended March 31, 2023 and 2022 (Unaudited)



	Three Months Ended March 31,
		2023		2022
		(in millions)
REVENUES
Policy charges and fee income		$	524	$	591
Premiums		197		189
Net derivative gains (losses)		(841)		144
Net investment income (loss)		858		755
Investment gains (losses), net:
Credit and intent to sell losses on available for sale debt securities and loans		(64)		10
Other investment gains (losses), net		(14)		(332)
Total investment gains (losses), net		(78)		(322)
Investment management and service fees		165		193
Other income		94		77
Total revenues		919		1,627

BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits		618		713
Remeasurement of liability for future policy benefits		13		14
Change in market risk benefits and purchased market risk benefits		24		(401)
Interest credited to policyholders’ account balances		435		288
Compensation and benefits		55		45
Commissions		194		171
Interest expense		3		—
Amortization of deferred policy acquisition costs		122		115
Other operating costs and expenses		175		266
Total benefits and other deductions		1,639		1,211
Income (loss) from continuing operations, before income taxes		(720)		416
Income tax (expense) benefit		701		(67)
Net income (loss)		(19)		349


Less: Net income (loss) attributable to the noncontrolling interest		—		(1)
Net income (loss) attributable to Equitable Financial		$	(19)	$	350

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Consolidated Statements of Comprehensive Income (Loss)

Three Months Ended March 31, 2023 and 2022 (Unaudited)


	Three Months Ended March 31,
		2023		2022
		(in millions)
COMPREHENSIVE INCOME (LOSS)
Net income (loss)		$	(19)	$	349

Other comprehensive income (loss), net of income taxes:
Change in unrealized gains (losses), net of adjustments (1)		1,509		(3,733)
Changes in market risk benefits - instrument-specific credit risk		933		1,512
Changes in liability for future policy benefits - current discount rate		(109)		257
Other comprehensive income (loss), net of income taxes		2,333		(1,964)
Comprehensive income (loss)		2,314		(1,615)
Less: Comprehensive income (loss) attributable to the noncontrolling interest (1)		—		(1)
Comprehensive income (loss) attributable to Equitable Financial		$	2,314	$	(1,614)

_____________

(1)See Note 13 of the Notes to these Consolidated Financial Statements for details of change in unrealized gains (losses), net of adjustments.

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Consolidated Statements of Equity

Three Months Ended March 31, 2023 and 2022 (Unaudited)



	Common Stock		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Total Equity
	(in millions)
January 1, 2023	$	2	$	8,536	$	(1,757)	$	(7,855)	$	(1,074)


Net income (loss)	—		—		(19)		—		(19)
Other comprehensive income (loss)	—		—		—		2,333		2,333
Other	—		(12)		—		—		(12)
March 31, 2023	$	2	$	8,524	$	(1,776)	$	(5,522)	$	1,228





January 1, 2022	$	2	$	8,546	$	(2,381)	$	1,316	$	7,483


Net income (loss)	—		—		350		—		350
Other comprehensive income (loss)	—		—		—		(1,964)		(1,964)
Other	—		(14)		—		—		(14)
March 31, 2022	$	2	$	8,532	$	(2,031)	$	(648)	$	5,855

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Consolidated Statements of Cash Flows

Three Months Ended March 31, 2023 and 2022 (Unaudited)


	Three Months Ended March 31,
	2023		2022
	(in millions)
Cash flows from operating activities:
Net income (loss)	$	(19)	$	349
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Interest credited to policyholders’ account balances	435		288
Policy charges and fee income	(524)		(591)
Net derivative (gains) losses	841		(144)
Credit and intent to sell losses on available for sale debt securities and loans	64		(10)
Investment (gains) losses, net	14		332
Realized and unrealized (gains) losses on trading securities	(12)		16
Non-cash long-term incentive compensation expense	9		13

Amortization and depreciation	136		88
Equity (income) loss from limited partnerships	(15)		(93)
Remeasurement of liability for future policy benefits	13		(401)
Change in Market Risk Benefits	24		14
Changes in:

Reinsurance recoverable (1)	(370)		(353)
Capitalization of deferred policy acquisition costs	(124)		(182)
Future policy benefits	(115)		67
Current and deferred income taxes (1)	(700)		64
Other, net	55		(270)
Net cash provided by (used in) operating activities	$	(288)	$	(813)

Cash flows from investing activities:
Proceeds from the sale/maturity/prepayment of:
Fixed maturities, available-for-sale	$	1,270	$	8,478
Mortgage loans on real estate	81		280
Trading account securities	55		36

Short-term investments	179		—
Other	188		89
Payment for the purchase/origination of:
Fixed maturities, available-for-sale	(821)		(8,109)
Mortgage loans on real estate	(580)		(688)
Trading account securities	(59)		(55)

Other	(232)		(181)
Cash settlements related to derivative instruments, net	(103)		302


Investment in capitalized software, leasehold improvements and EDP equipment	(5)		7
Other, net	44		56

See Notes to Consolidated Financial Statements (Unaudited).

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Consolidated Statements of Cash Flows

Three Months Ended March 31, 2023 and 2022 (Unaudited)


	Three Months Ended March 31,
	2023		2022
	(in millions)
Net cash provided by (used in) investing activities	$	17	$	215

Cash flows from financing activities:
Policyholders’ account balances:
Deposits	$	3,167	$	3,041
Withdrawals	(2,643)		(2,232)
Transfers (to) from Separate Accounts	315		500

Payments of MRB benefits	(172)		(122)
Change in collateralized pledged assets	(7)		(39)
Change in collateralized pledged liabilities	569		548



Purchase (redemption) of noncontrolling interests of consolidated company-sponsored investment funds	1		2




Other, net	—		(25)
Net cash provided by (used in) financing activities	$	1,230	$	1,673

Change in cash and cash equivalents	959		1,075
Cash and cash equivalents, beginning of year	797		1,815
Cash and cash equivalents, end of year	$	1,756	$	2,890

_____________

(1) For the period ended March 31, 2023 includes a release of $586 million deferred tax valuation allowance. Refer to Note 11 of these Consolidated Financial Statements.

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements (Unaudited)

1) ORGANIZATION

Equitable Financial’s (collectively with its consolidated subsidiaries, the “Company”) primary business is providing variable annuity, life insurance and employee benefit products to both individuals and businesses. The Company is an indirect, wholly-owned subsidiary of Holdings. Equitable Financial is a stock life insurance company organized in 1859 under the laws of the State of New York.

The Company’s two principal subsidiaries include Equitable Distributors, LLC (“Equitable Distributors”) and Equitable Investment Management Group, LLC (“EIMG”), which both are wholly-owned indirect subsidiaries of Holdings.

Global Atlantic Reinsurance Transaction

On October 3, 2022, Equitable Financial completed the transactions (the “Global Atlantic Transaction”) contemplated by the previously announced Master Transaction Agreement, dated August 16, 2022, by and between Equitable Financial and First Allmerica Financial Life Insurance Company, a Massachusetts-domiciled insurance company (the “Reinsurer”), and a wholly owned subsidiary of Global Atlantic Financial Group.

At the closing of the Global Atlantic Transaction, Equitable Financial and the Reinsurer entered into a Coinsurance and Modified Coinsurance Agreement (the “EQUI-VEST Reinsurance Agreement”), pursuant to which Equitable Financial ceded to the Reinsurer, on a combined coinsurance and modified coinsurance basis, a 50% quota share of approximately 360,000 legacy Group EQUI-VEST deferred variable annuity contracts issued by Equitable Financial between 1980 and 2008, which predominately include Equitable Financial’s highest guaranteed general account crediting rates of 3%, supported by general account assets of approximately $4 billion and $5 billion of Separate Account value (the “Reinsured Contracts”). The Reinsured Contracts predominately include certain of Equitable Financial’s contracts that offer the highest guaranteed general account crediting rates of 3%. At the closing of the Global Atlantic Transaction, the Reinsurer deposited assets supporting the general account liabilities relating to the Reinsured Contracts into a trust account for the benefit of Equitable Financial, which assets will secure its obligations to Equitable Financial under the EQUI-VEST Reinsurance Agreement. Commonwealth Annuity and Life Insurance Company, an insurance company domiciled in the Commonwealth of Massachusetts and affiliate of the Reinsurer (“Commonwealth”), provided a guarantee of the Reinsurer’s payment obligation to Equitable Financial under the EQUI-VEST Reinsurance Agreement.

The Company transferred assets of $2.8 billion, including primarily available-for-sale securities, cash and policy loans as the consideration for the reinsurance transaction. In addition, the Company recorded $4.1 billion of direct insurance liabilities ceded under the reinsurance contract included in amounts due from reinsurers and $1.2 billion of deferred gain on cost of reinsurance included within other liabilities. Additionally, $5.3 billion of Separate Account liabilities were ceded under a modified coinsurance portion of the agreement.

2) SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The unaudited interim consolidated financial statements (the “consolidated financial statements”) have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”) on a basis consistent with reporting interim financial information in accordance with instructions to the Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (“SEC”).

In the opinion of management, all adjustments necessary for a fair statement of the financial position and results of operations have been made. All such adjustments are of a normal, recurring nature. Interim results are not necessarily indicative of the results that may be expected for the full year. These financial statements should be read in conjunction with the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Certain prior period amounts were adjusted to reflect the adoption of ASU 2018-12: Financial Services - Insurance (Topic 944).

The accompanying unaudited consolidated financial statements present the consolidated results of operations, financial condition and cash flows of the Company and its subsidiaries and those investment companies, partnerships and joint

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

ventures in which the Company has control and a majority economic interest as well as those variable interest entities (“VIEs”) that meet the requirements for consolidation.

All significant intercompany transactions and balances have been eliminated in consolidation. The terms “first quarter 2023” and “first quarter 2022” refer to the three months ended March 31, 2023 and 2022, respectively. The terms “first three months of 2023” and “first three months of 2022” refer to the three months ended March 31, 2023 and 2022, respectively.

Certain prior year amounts have been reclassified to conform to the current year’s presentation.

Adoption of New Accounting Pronouncements


Description			Effect on the Financial Statement or Other Significant Matters
ASU 2018-12: Financial Services - Insurance (Topic 944)
This ASU provides targeted improvements to existing recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. The ASU primarily impacts four key areas, including: 1. Measurement of the liability for future policy benefits for traditional and limited payment contracts. The ASU requires companies to review, and if necessary, update cash flow assumptions at least annually for non-participating traditional and limited-payment insurance contracts. The ASU also prescribes the discount rate to be used in measuring the liability for future policy benefits for traditional and limited payment long-duration contracts. 2. Measurement of Market Risk Benefits (“MRBs”). MRBs, as defined under the ASU, will encompass certain GMxB features associated with variable annuity products and other general account annuities with other than nominal market risk. 3. Amortization of deferred acquisition costs. The ASU simplifies the amortization of deferred acquisition costs and other balances amortized in proportion to premiums, gross profits, or gross margins, requiring such balances to be amortized on a constant level basis over the expected term of the contracts. 4. Expanded footnote disclosures. The ASU requires additional disclosures including information about significant inputs, judgements, assumptions and methods used in measurement.			On January 1, 2023, the Company adopted the new accounting standard ASU 2018-12 using the modified retrospective approach, except for MRBs which will use the full retrospective approach. Refer to “Transition impact of ASU 2018-12, Financial Services- Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts” section within this note for further details.

Transition impact of ASU 2018-12, Financial Services—Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts

The Company has not retrospectively adjusted its consolidated financial statements for the year ended December 31, 2020 to reflect the adoption of ASU 2018-12, consistent with the Division of Corporation Finance’s Financial Reporting Manual Section 11410.1.

The Company adopted ASU 2018-12 for liability for future policy benefits (“LFPB”), additional insurance liabilities, DAC and balances amortized on a basis consistent with DAC on a modified retrospective basis. ASU 2018-12 was adopted for MRBs on a full retrospective basis.

For the liability for future policy benefits, there is limited unfavorable retained earnings impact due to net premiums exceeding gross premiums. There is unfavorable accumulated other comprehensive income (“AOCI”) impact due to using the current single-A rate which is lower than the locked in discount rate.

For market risk benefits, the transition adjustment to AOCI related to the effect of the changes in the instrument-specific credit risk of market risk benefits between the contract issue and transition date. The remaining transition

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

difference was related to recording market risk benefits at fair value. This change was recorded as an adjustment to retained earnings as of the transition date.

For DAC and balances amortized on a basis consistent with DAC including sales inducement assets and unearned revenue liabilities, there is no retained earnings impact due to application of the modified transition approach. There is a favorable AOCI impact due to the removal of DAC balances recorded in AOCI, offsetting the unfavorable AOCI impact resulting from LFPB.

The following table presents the effect of transition adjustment to total equity resulting from the adoption of ASU 2018-12 as of January 1, 2021:


	Retained Earnings		Accumulated Other Comprehensive Income		Total
	(in millions)
Liability for future policy benefits	$	(2)	$	(819)	$	(821)
Market risk benefits	(3,402)		(904)		(4,306)
DAC	—		467		467

Unearned revenue liability and sales inducement assets (1)	—		(128)		(128)

Total transition adjustment before taxes	(3,404)		(1,384)		(4,788)
Income taxes	715		291		1,006
Total transition adjustment (net of taxes)	$	(2,689)	$	(1,093)	$	(3,782)

______________

(1) Unearned revenue liability included within liability for future policy benefits financial statement line item in the consolidated balance sheets. Sales inducement assets are included in other assets in the consolidated balance sheets.

The following table summarizes the balance of and changes in liability for future policy benefits on January 1, 2021 resulting from the adoption of ASU 2018-12:



	Term		Payout		Group Pension		Health		Total
	(in millions)
Balance, December 31, 2020	$	1,415	$	3,047	$	771	$	2,100	$	7,333

Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	—		(171)		(85)		(100)		(356)


Effect of remeasurement of liability at current single A rate	559		531		94		300		1,484
Balance, January 1, 2021 (1)	1,974		3,407		780		2,300		8,461
Less: Reinsurance Recoverable	(372)		—		—		(1,837)		(2,209)
Balance, January 1, 2021, net of reinsurance	$	1,602	$	3,407	$	780	$	463	$	6,252

______________

(1)LFPB transition table not inclusive of the following transition adjustments to AOCI including PFBL of $30 million, premium deficiency reserve (“PDR”) of $(146) million, Rider Reserves, Term Reinsurance of $(79) million and Other of $(111) million, which primarily consists of DI Ceded, DI Assumed and Reinsurance Assumed.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

The following table summarizes the balance of and changes in the net liability position of market risk benefits on January 1, 2021 resulting from the adoption of ASU 2018-12:


	GMxB Legacy		GMxB Core		Purchased MRB		Total
	(in millions)
Balance, December 31, 2020	$	19,891	$	2,206	$	(2,943)	$	19,154
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	(70)		(4)		—		(74)
Adjustments for the cumulative effect of the changes in the instrument-specific credit risk between the original contract issuance date and the transition date	461		505		5		971
Adjustments for the remaining difference (exclusive of the instrument specific credit risk change and host contract adjustments) between previous carrying amount and fair value measurement for the MRB	4,122		(563)		(194)		3,365
Balance, January 1, 2021 (1)	$	24,404	$	2,144	$	(3,132)	$	23,416

____________

(1)MRB transition table not inclusive of the following transition adjustments to retained earnings and AOCI including EQUI-VEST of $43 million, SCS of $21 million and Group Retirement EQUI-VEST of $(20) million.

The following table summarizes the balance of and changes in DAC on January 1, 2021 resulting from the adoption of ASU 2018-12:


	Term		UL (1)		VUL (2)		IUL (3)		GMxB Legacy		GMxB Core		EI (4)		IE (5)		SCS		EG (6)		Momentum		Total
	(in millions)
Balance, December 31, 2020	$	403	$	—	$	—	$	—	$	192	$	1,635	$	141	$	95	$	645	$	581	$	79	$	3,771
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	—		5		6		—		8		11		13		(1)		210		53		22		327
Balance, January 1, 2020 (7)	$	403	$	5	$	6	$	—	$	200	$	1,646	$	154	$	94	$	855	$	634	$	101	$	4,098

______________

(1) “UL” defined as Universal Life

(2) “VUL” defined as Variable Universal Life

(3) “IUL” defined as Indexed Universal Life

(4) “EI” defined as EQUI-VEST Individual

(5) “IE” defined as Investment Edge

(6) “EG” defined as EQUI-VEST Group

(7) DAC transition table not inclusive of Closed Block of $136 million and Protection Solutions of $3 million transition adjustment.

The following table summarizes the balance of and changes in sales inducement assets and unearned revenue liability on January 1, 2021 resulting from the adoption of ASU 2018-12:


	Sales Inducement Assets				Total
	GMxB Legacy		GMxB Core
	(in millions)
Balance, December 31, 2020	$	246	$	158	$	404
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	—		—		—

Balance, January 1, 2021	$	246	$	158	$	404

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	Unearned Revenue Liability						Total
	UL		VUL		IUL
	(in millions)
Balance, December 31, 2020	$	31	$	382	$	—	$	413
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	29		99		—		128

Balance, January 1, 2021	$	60	$	481	$	—	$	541

DAC

Acquisition costs that vary with and are primarily related to the acquisition of new and renewal insurance business, reflecting incremental direct costs of contract acquisition with independent third parties or employees that are essential to the contract transaction, as well as the portion of employee compensation, including employee fringe benefits and other costs directly related to underwriting, policy issuance and processing, medical inspection, and contract selling for successfully negotiated contracts including commissions, underwriting, agency and policy issue expenses, are deferred.

Contracts are measured on a grouped basis utilizing cohorts consistent with those used in the calculation of future policy benefit reserves. DAC is amortized on a constant level basis for the grouped contracts over the expected term of the contract. For life insurance products, DAC is amortized in proportion to the face amount in force. For annuity products DAC is amortized in proportion to policy counts. The constant level basis used for amortization determines the current period amortization considering both the current period’s actual experience and future projections. The amortization pattern is revised quarterly on a prospective basis. Amortization of DAC is included in Amortization of DAC, part of total benefits and other deductions.

For some products, policyholders can elect to modify product benefits, features, rights or coverages that occur by the exchange of a contract for a new contract, or by amendment, endorsement, or rider to a contract, or by election or coverage within a contract. These transactions are known as internal replacements. If such modification substantially changes the contract, the associated DAC is written off immediately through income and any new acquisition costs associated with the replacement contract are deferred.

Amount due to and from Reinsurers

For each of its reinsurance agreements, the Company determines whether the agreement provides indemnification against loss or liability relating to insurance risk in accordance with applicable accounting standards. Cessions under reinsurance agreements do not discharge the Company’s obligations as the primary insurer. The Company reviews all contractual features, including those that may limit the amount of insurance risk to which the reinsurer is subject or features that delay the timely reimbursement of claims.

For reinsurance of existing in-force blocks of long-duration contracts that transfer significant insurance risk, the difference, if any, between the amounts paid (received), and the liabilities ceded (assumed) related to the underlying contracts is considered the net cost of reinsurance at the inception of the reinsurance agreement. Subsequent amounts paid (received) on the reinsurance of in-force blocks, as well as amounts paid (received) related to new business, are recorded as premiums ceded (assumed); and amounts due from reinsurers (amounts due to reinsurers) are established.

Assets and liabilities relating to reinsurance agreements with the same reinsurer may be recorded net on the balance sheet, if a right of offset exists within the reinsurance agreement. In the event that reinsurers do not meet their obligations to the Company under the terms of the reinsurance agreements, reinsurance recoverable balances could become uncollectible. In such instances, reinsurance recoverable balances are stated net of allowances for uncollectible reinsurance.

Premiums, policy charges and fee income, and policyholders’ benefits include amounts assumed under reinsurance agreements and are net of reinsurance ceded. Amounts received from reinsurers for policy administration are reported in other revenues.

For reinsurance contracts, reinsurance recoverable balances are generally calculated using methodologies and assumptions that are consistent with those used to calculate the direct liabilities.

Ceded reinsurance transactions are recognized and measured in a manner consistent with underlying reinsured contracts, including using consistent assumptions. Assumed and ceded reinsurance contract rights and obligations are

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

accounted for on a basis consistent with our direct contract. The reinsurance cost or benefit for traditional life non-participating and limited-payment contracts is recognized in proportion to the gross premiums of the underlying direct cohorts. The locked-in single A discount rate used to calculate the reinsurance cost or benefit is established at inception of the reinsurance contract. Changes to the single A discount rate are reflected in comprehensive income at each reporting date.

If the Company determines that a reinsurance agreement does not expose the reinsurer to a reasonable possibility of a significant loss from insurance risk, the Company records the agreement using the deposit method of accounting. Deposits received are included in other liabilities and deposits made are included within other assets. As amounts are paid or received, consistent with the underlying contracts, the deposit assets or liabilities are adjusted. Interest on such deposits is recorded as other income or other operating costs and expenses, as appropriate.

Sales Inducement Assets

Sales inducement assets are offered on certain deferred annuity products in the form of either immediate bonus interest credited or enhanced interest crediting rates for a period of time. The interest crediting expense associated with these sales inducement assets is deferred and amortized over the lives of the underlying contracts in a manner consistent with the amortization of DAC. Unamortized balances are included in other assets in the consolidated balance sheets and amortization is included in interest credited to policyholders’ account balances in the consolidated statements of income (loss).

Policyholders’ Account Balances

Policyholders’ account balances relate to contracts or contract features where the Company has no significant insurance risk. This liability represents the contract value that has accrued to the benefit of the policyholder as of the balance sheet date.

Obligations arising from funding agreements are also reported in policyholders’ account balances in the consolidated balance sheets. As a member of the FHLB, the Company has access to collateralized borrowings. The Company may also issue funding agreements to the FHLB. Both the collateralized borrowings and funding agreements would require the Company to pledge qualified mortgage-backed assets and/or government securities as collateral.

Future Policy Benefits and Other Policyholders’ Liabilities

The liability for future policy benefits is estimated based upon the present value of future policy benefits and related claim expenses less the present value of estimated future net premiums where net premium equals gross premium under the contract multiplied by the net premium ratio. Related claim expenses include termination and settlement costs and exclude acquisition costs and non-claim related costs. The liability is estimated using current assumptions that include discount rate, mortality, lapses and expenses. Assumptions are based on judgments that consider the Company’s historical experience, industry data, and other factors.

For participating traditional life insurance policies, future policy benefit liabilities are calculated using a net level premium method based on guaranteed mortality and dividend fund interest rates. The liability for annual dividends represents the accrual of annual dividends earned. Terminal dividends are accrued in proportion to face amount over the life of the contract.

For non-participating traditional life insurance policies (Term) and limited pay contracts (Payout, Pension), contracts are grouped into cohorts by contract type and issue year. The Company quarterly updates its estimate of cash flows using actual experience and current future cash flow assumptions, which is reflected in an updated net premium ratio used to calculate the liability. The ratio of actual and future expected claims to actual and future expected premiums determines the net premium ratio. The policy administration expense assumption is not updated after policy issuance. If actual expenses differ from the original expense assumptions, the differences are recognized in the period identified. The revised net premium ratio is used to determine the updated liability for future policy benefits as of the beginning of the reporting period, discounted at the original contract issuance rate. Changes in the liability due to current discount rates differing from original rates are included in other comprehensive income within the consolidated statement of comprehensive income.

For non-participating traditional life insurance policies and limited pay contracts, the discount rate assumption used is corporate A rated forward curve. We use a forward curve based upon a Bloomberg index. The liability is remeasured each quarter with the remeasurement change reported in other comprehensive income. The locked-in discount rate is generally based on expected investment returns at contract inception for contracts issued prior to January 1, 2021 and

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

the upper medium grade fixed income corporate instrument yield (i.e., single A) at contract inception for contracts issued after January 1, 2021. The Company developed an LDTI discount rate methodology used to calculate the LFPB for its traditional insurance liabilities and constructed a discount rate curve that references upper-medium grade (low credit risk) fixed-income instrument yields (i.e. Single-A rated Corporate bond yields) which are meant to reflect the duration characteristics of the corresponding insurance liabilities. The methodology uses observable market data, where available, and uses various estimation techniques in line with fair value guidance (such as interpolation and extrapolation) where data is limited. Discount rates are updated quarterly.

For limited-payment products, gross premiums received in excess of net premiums are deferred at initial recognition as a deferred profit liability (“DPL”). DPL will be amortized in relation to the expected future benefit payments. As the calculation of the DPL is based on discounted cash flows, interest accrues on the unamortized DPL balance using the discount rate determined at contract issuance. The DPL is updated at the same time as the estimates for cash flows for the liability for future policy benefits. Any difference between the recalculated and beginning of period DPL is recognized in remeasurement gain or loss in the consolidated statements of income (loss), Remeasurement of Liability for Future Policy Benefits, part of total benefits and other deductions. On the consolidated balance sheet the DPL is recorded in the liability for future policy benefits.

Additional liabilities for contract or contract feature that provide for additional benefits in addition to the account balance but are not market risk benefits or embedded derivatives (“additional insurance liabilities”) are established by estimating the expected value of death or other insurance benefits in excess of the projected contract accumulation value and recognizing the excess over the estimated life based on expected assessments (i.e., benefit ratio). The liability equals the current benefit ratio multiplied by cumulative assessments recognized to date, plus interest, less cumulative excess payments to date. These reserves are recorded within future policy benefits and other policyholders’ liabilities. The determination of this estimated future policy benefits liability is based on models that involve numerous assumptions and subjective judgments, including those regarding expected market rates of return and volatility, contract surrender and withdrawal rates, and mortality experience. There can be no assurance that actual experience will be consistent with management’s estimates. Assumptions are reviewed annually and updated with the remeasurement gain or loss reflected in total benefit expense.

The Company recognizes an adjustment in other comprehensive income for the additional insurance liabilities for unrealized gains and losses not included when calculating the present value of expected assessments for the benefit ratios.

The Company conducts annual premium deficiency testing except for liability for future policy benefits for non- participating traditional and limited payment contracts. The Company reviews assumptions and determines whether the sum of existing liabilities and the present value of future gross premiums is sufficient to cover the present value of future benefits to be paid and settlement costs. Anticipated investment income is considered when performing premium deficiency for long duration contracts. The anticipated investment income is projected based on current investment portfolio returns grading to long term reinvestment rates over the projection periods, based on anticipated gross reinvestment spreads, defaults and investment expenses. Premium deficiency reserves are recorded in certain instances where the policyholder liability for a particular line of business may not be deficient in the aggregate to trigger loss recognition, but the pattern of earnings may be such that profits are expected to be recognized in earlier years followed by losses in later years. This pattern of profits followed by losses is exhibited in our VISL business and is generated by the cost structure of the product or secondary guarantees in the contract. The secondary guarantee ensures that, subject to specified conditions, the policy will not terminate and will continue to provide a death benefit even if there is insufficient policy value to cover the monthly deductions and charges. We accrue for these PFBL using a dynamic approach that changes over time as the projection of future losses change.

Market Risk Benefits

Market risk benefits (“MRBs”) are contracts or contract features that provide protection to the contract holder from other than nominal capital market risk and expose the Company to other than nominal capital market risk. Market risk benefits include contract features that provide minimum guarantees to policyholders and include GMIB, GMDB, GMWB, GMAB, and ROP DB benefits. MRBs are measured at fair value on a seriatim basis using an ascribed fee approach based upon policyholder behavior projections and risk neutral economic scenarios adjusted based on the facts and circumstances of the Company’s product features. The MRB Asset and MRB Liability will be equal to the average present value of benefits and risk margins less the average present value of ascribed fees. Ascribed fees will consist of the fee needed, under a stochastically generated set of risk-neutral scenarios, so that the mean present value of claims, including any risk charge, is equal to the mean present value of the projected attributed fees which will be capped at average present value of total policyholder contractual fees. The attributed fee percentage is considered a fixed term of

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

the MRB feature and is held static over the life of the contract. Changes in fair value are recognized as a remeasurement gain/loss in the Change in market risk benefits and purchased market risk benefits, part of total benefits and other deductions except for the portion of the change in the fair value due to change in the Company’s own credit risk, which is recognized in other than comprehensive income. Additionally, when an annuitization occurs (for annuitization benefits) or upon extinguishment of the account balance (for withdrawal benefits) the balance related to the MRB will be derecognized and the amount deducted (after derecognition of any related amount included in accumulated other comprehensive income) shall be used in the calculation of the liability for future policy benefits for the payout annuity. Upon derecognition, any related balance will be removed from AOCI.

The Company has issued and continues to offer certain variable annuity products with GMDB and/or contain a GMLB (collectively, the “GMxB features”) which, if elected by the policyholder after a stipulated waiting period from contract issuance, guarantees a minimum lifetime annuity based on predetermined annuity purchase rates that may be in excess of what the contract account value can purchase at then-current annuity purchase rates. This minimum lifetime annuity is based on predetermined annuity purchase rates applied to a GMIB base. The Company previously issued certain variable annuity products with GMIB, GWBL, GMWB and GMAB features. The Company has also assumed reinsurance for products with GMxB features.

Features in ceded reinsurance contracts that meet the definition of MRBs are accounted for at fair value. The fees used to determine the fair value of the reinsured market risk benefit are those defined in the reinsurance contract. The expected periodic future premiums would represent cash outflows and the expected future benefits would represent cash inflows in the fair value calculation. On the ceded side, the Purchased MRB will be measured considering the counterparty credit risk of the reinsurer, while the direct contract liabilities will be measured considering the instrument-specific credit risk of the insurer. As a result of the difference in the treatment of the counterparty credit risk, the fair value of the direct and ceded contracts may be different even if the contractual fees and benefits are the same. Changes in instrument-specific credit risk of the Company is included in the fair value of its market risk benefit, whether in an asset or liability position, and whether related to an issued or purchased MRB, is recognized in OCI. The counterparty credit risk of the reinsurer is recorded in the consolidated statements of income (loss).

Troubled Debt Restructuring

The Company invests in commercial and agricultural mortgage loans included in the balance sheet as mortgage loans on real estate. Under certain circumstances, modifications are granted to these contracts. Each modification is evaluated as to whether a TDR has occurred. A modification is a TDR when the borrower is in financial difficulty. The types of modifications made may include reducing the face amount or maturity amount of the debt as originally stated, reducing the contractual interest rate, extending the maturity date at an interest rate lower than current market interest rates and/or reducing accrued interest. The credit allowance is an estimate of lifetime expected losses reflecting historical loss information which included losses from modification to a borrower experiencing financial difficulty. As the effect of the modification made to a borrower experiencing financial difficulty is already included in the credit allowance, the carrying value (net of the allowance) before and after modification through a TDR may not change significantly or may increase if the expected recovery is higher than the pre-modification recovery assessment. For information pertaining to our TDRs see Note 3 of the Notes to these Consolidated Financial Statements.

Accounting and Consolidation of VIEs

For all new investment products and entities developed by the Company, the Company first determines whether the entity is a VIE, which involves determining an entity’s variability and variable interests, identifying the holders of the equity investment at risk and assessing the five characteristics of a VIE. Once an entity has been determined to be a VIE, the Company then determines whether it is the primary beneficiary of the VIE based on its beneficial interests. If the Company is deemed to be the primary beneficiary of the VIE, then the Company consolidates the entity.

Management of the Company reviews quarterly its investment management agreements and its investments in, and other financial arrangements with, certain entities that hold client AUM to determine the entities that the Company is required to consolidate under this guidance. These entities include certain mutual fund products, hedge funds, structured products, group trusts, collective investment trusts and limited partnerships.

The analysis performed to identify variable interests held, determine whether entities are VIEs or VOEs, and evaluate whether the Company has a controlling financial interest in such entities requires the exercise of judgment and is updated on a continuous basis as circumstances change or new entities are developed. The primary beneficiary evaluation generally is performed qualitatively based on all facts and circumstances, including consideration of

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

economic interests in the VIE held directly and indirectly through related parties and entities under common control, as well as quantitatively, as appropriate.

Consolidated VIEs

As of March 31, 2023 and December 31, 2022, the Company consolidated limited partnerships and LLCs for which it was identified as the primary beneficiary under the VIEs model. Included in Other invested assets and Mortgage loans on real estate in the Company’s consolidated balance sheets at March 31, 2023 and December 31, 2022 are total assets of $532 million and $410 million, respectively related to these VIEs.

Non-Consolidated VIEs

As of March 31, 2023 and December 31, 2022, respectively, the Company held approximately $2.4 billion and $2.3 billion of investment assets in the form of equity interests issued by non-corporate legal entities determined under the guidance to be VIEs, such as limited partnerships and limited liability companies, including CLOs, hedge funds, private equity funds and real estate-related funds. As an equity investor, the Company is considered to have a variable interest in each of these VIEs as a result of its participation in the risks and/or rewards these funds were designed to create by their defined portfolio objectives and strategies. Primarily through qualitative assessment, including consideration of related party interests or other financial arrangements, if any, the Company was not identified as primary beneficiary of any of these VIEs, largely due to its inability to direct the activities that most significantly impact their economic performance. Consequently, the Company continues to reflect these equity interests in the consolidated balance sheets as other equity investments and applies the equity method of accounting for these positions. The net assets of these non-consolidated VIEs are approximately $257.0 billion and $282.3 billion as of March 31, 2023 and December 31, 2022, respectively. The Company’s maximum exposure to loss from its direct involvement with these VIEs is the carrying value of its investment of $2.4 billion and $2.3 billion and approximately $1.3 billion and $1.3 billion of unfunded commitments as of March 31, 2023 and December 31, 2022, respectively. The Company has no further economic interest in these VIEs in the form of guarantees, derivatives, credit enhancements or similar instruments and obligations.

3) INVESTMENTS

Fixed Maturities AFS

The components of fair value and amortized cost for fixed maturities classified as AFS on the consolidated balance sheets excludes accrued interest receivable because the Company elected to present accrued interest receivable within other assets. Accrued interest receivable on AFS fixed maturities as of March 31, 2023 and December 31, 2022 was $563 million and $550 million, respectively. There was no accrued interest written off for AFS fixed maturities for the three months ended March 31, 2023 and 2022.

The following tables provide information relating to the Company’s fixed maturities classified as AFS.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

AFS Fixed Maturities by Classification


	Amortized Cost		Allowance for Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in millions)
March 31, 2023
Fixed Maturities:
Corporate (1)	$	45,649	$	18	$	154	$	5,636	$	40,149
U.S. Treasury, government and agency	6,995		—		3		1,023		5,975
States and political subdivisions	548		—		12		66		494
Foreign governments	996		—		3		132		867
Residential mortgage-backed (2)	881		—		1		81		801
Asset-backed (3)	8,472		—		8		313		8,167
Commercial mortgage-backed	3,772		—		—		542		3,230
Redeemable preferred stock	40		—		3		—		43
Total at March 31, 2023	$	67,353	$	18	$	184	$	7,793	$	59,726

December 31, 2022:
Fixed Maturities:
Corporate (1)	$	46,053	$	24	$	89	$	6,655	$	39,463
U.S. Treasury, government and agency	7,049		—		1		1,312		5,738
States and political subdivisions	540		—		7		76		471
Foreign governments	985		—		2		151		836
Residential mortgage-backed (2)	860		—		1		84		777
Asset-backed (3)	8,817		—		3		371		8,449
Commercial mortgage-backed	3,742		—		—		572		3,170
Redeemable preferred stock	41		—		2		—		43
Total at December 31, 2022	$	68,087	$	24	$	105	$	9,221	$	58,947

______________

(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, credit risk transfer securities and other asset types.

The contractual maturities of AFS fixed maturities as of March 31, 2023 are shown in the table below. Bonds not due at a single maturity date have been included in the table in the final year of maturity. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

Contractual Maturities of AFS Fixed Maturities


	Amortized Cost (Less Allowance for Credit Losses)		Fair Value
	(in millions)
March 31, 2023:
Contractual maturities:
Due in one year or less	$	1,182	$	1,170
Due in years two through five	14,080		13,454
Due in years six through ten	14,281		12,986
Due after ten years	24,627		19,875
Subtotal	54,170		47,485
Residential mortgage-backed	881		801
Asset-backed	8,472		8,167
Commercial mortgage-backed	3,772		3,230
Redeemable preferred stock	40		43
Total at March 31, 2023	$	67,335	$	59,726

The following table shows proceeds from sales, gross gains (losses) from sales and allowance for credit losses for AFS fixed maturities.

Proceeds from Sales, Gross Gains (Losses) from Sales and Allowance for Credit and Intent to Sell Losses for AFS Fixed Maturities


	Three Months Ended March 31,
		2023		2022
		(in millions)
Proceeds from sales		$	728	$	7,336
Gross gains on sales		$	2	$	29
Gross losses on sales		$	(18)	$	(361)

Net (increase) decrease in Allowance for Credit and Intent to Sell losses		$	(54)	$	1

The following table sets forth the amount of credit loss impairments on AFS fixed maturities held by the Company at the dates indicated and the corresponding changes in such amounts.

AFS Fixed Maturities - Credit and Intent to Sell Loss Impairments


	Three Months Ended March 31,
		2023		2022
		(in millions)
Balance, beginning of period		$	36	$	42
Previously recognized impairments on securities that matured, paid, prepaid or sold		(3)		(2)
Recognized impairments on securities impaired to fair value this period (1) (2)		50		—
Credit losses recognized this period on securities for which credit losses were not previously recognized		3		—
Additional credit losses this period on securities previously impaired		1		1
Increases due to passage of time on previously recorded credit losses		—		—

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	Three Months Ended March 31,
		2023		2022
		(in millions)
Accretion of previously recognized impairments due to increases in expected cash flows (for OTTI securities 2019 and prior)		—		—
Balance at March 31,		$	87	$	41

______________

(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.

(2)Amounts reflected for three months ended March 31, 2023 represent AFS fixed maturities in an unrealized loss position, which the Company intends to sell in anticipation of the Company’s ordinary dividend to Holdings.

The tables that follow below present a roll-forward of net unrealized investment gains (losses) recognized in AOCI.

Net Unrealized Gains (Losses) on AFS Fixed Maturities


	Net Unrealized Gains (Losses) on Investments		Policyholders’ Liabilities		Deferred Income Tax Asset (Liability)		AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)
	(in millions)
Balance, January 1, 2023	$	(9,116)	$	21	$	421	$	(8,674)
Net investment gains (losses) arising during the period	1,444		—		—		1,444
Reclassification adjustment:							—
Included in net income (loss)	70		—		—		70

Other	—		—		—		—
Impact of net unrealized investment gains (losses)	—		(3)		(317)		(320)
Net unrealized investment gains (losses) excluding credit losses	(7,602)		18		104		(7,480)
Net unrealized investment gains (losses) with credit losses	(7)		—		1		(6)
Balance, March 31, 2023	$	(7,609)	$	18	$	105	$	(7,486)

Balance, January 1, 2022	$	4,462	$	(703)	$	(790)	$	2,969
Net investment gains (losses) arising during the period	(6,065)		—		—		(6,065)
Reclassification adjustment:							—
Included in net income (loss)	331		—		—		331

Other	—		—		—		—
Impact of net unrealized investment gains (losses)	—		704		984		1,688
Net unrealized investment gains (losses) excluding credit losses	(1,272)		1		194		(1,077)
Net unrealized investment gains (losses) with credit losses	(5)		—		1		(4)
Balance, March 31, 2022	$	(1,277)	$	1	$	195	$	(1,081)

The following tables disclose the fair values and gross unrealized losses of the 4,520 issues as of March 31, 2023 and the 4,798 issues as of December 31, 2022 that are not deemed to have credit losses, aggregated by investment category

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

and length of time that individual securities have been in a continuous unrealized loss position for the specified periods at the dates indicated:

AFS Fixed Maturities in an Unrealized Loss Position for Which No Allowance Is Recorded


	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)
March 31, 2023
Fixed Maturities:
Corporate	$	7,329	$	366	$	27,799	$	5,268	$	35,128	$	5,634
U.S. Treasury, government and agency	3,354		417		2,417		606		5,771		1,023
States and political subdivisions	31		2		219		64		250		66
Foreign governments	92		6		645		126		737		132
Residential mortgage-backed	259		10		508		71		767		81
Asset-backed	1,443		36		5,910		277		7,353		313
Commercial mortgage-backed	426		29		2,739		513		3,165		542

Total at March 31, 2023	$	12,934	$	866	$	40,237	$	6,925	$	53,171	$	7,791

December 31, 2022:
Fixed Maturities:
Corporate	$	22,034	$	2,431	$	15,014	$	4,222	$	37,048	$	6,653
U.S. Treasury, government and agency	5,465		1,294		204		18		5,669		1,312
States and political subdivisions	91		18		158		58		249		76
Foreign governments	349		42		418		109		767		151
Residential mortgage-backed	665		49		79		35		744		84
Asset-backed	6,262		228		1,759		143		8,021		371
Commercial mortgage-backed	1,572		200		1,580		372		3,152		572

Total at December 31, 2022	$	36,438	$	4,262	$	19,212	$	4,957	$	55,650	$	9,219

The Company’s investments in fixed maturities do not include concentrations of credit risk of any single issuer greater than 10% of the consolidated equity of the Company, other than securities of the U.S. government, U.S. government agencies, and certain securities guaranteed by the U.S. government. The Company maintains a diversified portfolio of corporate securities across industries and issuers and does not have exposure to any single issuer in excess of 1.0% of total corporate securities. The largest exposures to a single issuer of corporate securities held as of March 31, 2023 and December 31, 2022 were $387 million and $327 million, respectively, representing 31.5% and 30.4% of the consolidated equity of the Company.

Corporate high yield securities, consisting primarily of public high yield bonds, are classified as other than investment grade by the various rating agencies, i.e., a rating below Baa3/BBB- or the NAIC designation of 3 (medium investment grade), 4 or 5 (below investment grade) or 6 (in or near default). As of March 31, 2023 and December 31, 2022, respectively, approximately $2.8 billion and $2.9 billion, or 4.2% and 4.3%, of the $67.4 billion and $68.1 billion aggregate amortized cost of fixed maturities held by the Company were considered to be other than investment grade. These securities had gross unrealized losses of $166 million and $208 million as of March 31, 2023 and December 31, 2022, respectively.

As of March 31, 2023 and December 31, 2022, respectively, the $6.9 billion and $5.0 billion of gross unrealized losses of twelve months or more were primarily concentrated in corporate securities. In accordance with the policy described in Note 2 of the Notes to these Consolidated Financial Statements, the Company concluded that an adjustment to the allowance for credit losses for these securities was not warranted at either March 31, 2023 or December 31, 2022. As of March 31, 2023 and December 31, 2022, the Company did not intend to sell the securities nor will it likely be required to dispose of the securities before the anticipated recovery of their remaining amortized cost basis.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

Based on the Company’s evaluation both qualitatively and quantitatively of the drivers of the decline in fair value of fixed maturity securities as of March 31, 2023, the Company determined that the unrealized loss was primarily due to increases in interest rates and credit spreads.

Mortgage Loans on Real Estate

Accrued interest receivable on commercial and agricultural mortgage loans as of March 31, 2023 and December 31, 2022 was $72 million and $71 million, respectively. There was no accrued interest written off for commercial and agricultural mortgage loans for the three months ended March 31, 2023 and 2022.

As of March 31, 2023 and 2022, the Company had no loans for which foreclosure was probable included within the individually assessed mortgage loans, and accordingly had no associated allowance for credit losses.

Allowance for Credit Losses on Mortgage Loans

The change in the allowance for credit losses for commercial mortgage loans and agricultural mortgage loans during the three months ended March 31, 2023 and 2022 were as follows:


	Three Months Ended March 31,
		2023		2022
		(in millions)
Allowance for credit losses on mortgage loans:
Commercial mortgages:
Balance, beginning of the period		$	123	$	57
Current-period provision for expected credit losses		10		(10)
Write-offs charged against the allowance		—		—
Recoveries of amounts previously written off				—
Net change in allowance		10		(10)
Balance, end of the period		$	133	$	47

Agricultural mortgages:
Balance, beginning of the period		$	6	$	5
Current-period provision for expected credit losses		—		1
Write-offs charged against the allowance		—		—
Recoveries of amounts previously written off				—
Net change in allowance		—		1
Balance, end of the period		$	6	$	6

Total allowance for credit losses		$	139	$	53

The change in the allowance for credit losses is attributable to:

•increases/decreases in the loan balance due to new originations, maturing mortgages, and loan amortization and

•changes in credit quality and economic assumptions.

Credit Quality Information

The following tables summarize the Company’s mortgage loans segregated by risk rating exposure as of March 31, 2023 and December 31, 2022.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

Loan to Value (“LTV”) Ratios (1)


	March 31, 2023
	Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Mortgage loans:
Commercial:
0% - 50%	$	—	$	679	$	130	$	—	$	—	$	1,449	$	—	$	—	$	2,258
50% - 70%	237		2,230		1,568		906		312		2,911		268		94		8,526
70% - 90%	243		364		382		463		328		1,635		28		34		3,477
90% plus	—		—		33		—		—		225		—		—		258
Total commercial	$	480	$	3,273	$	2,113	$	1,369	$	640	$	6,220	$	296	$	128	$	14,519

Agricultural:
0% - 50%	$	10	$	164	$	182	$	237	$	128	$	847	$	—	$	—	$	1,568
50% - 70%	11		188		182		208		67		332		—		—		988
70% - 90%	—		—		—		—		—		16		—		—		16
90% plus	—		—		—		—		—		—		—		—		—
Total agricultural	$	21	$	352	$	364	$	445	$	195	$	1,195	$	—	$	—	$	2,572


Total mortgage loans:
0% - 50%	$	10	$	843	$	312	$	237	$	128	$	2,296	$	—	$	—	$	3,826
50% - 70%	248		2,418		1,750		1,114		379		3,243		268		94		9,514
70% - 90%	243		364		382		463		328		1,651		28		34		3,493
90% plus	—		—		33		—		—		225		—		—		258
Total mortgage loans	$	501	$	3,625	$	2,477	$	1,814	$	835	$	7,415	$	296	$	128	$	17,091

Debt Service Coverage (“DSC”) Ratios (2)


	March 31, 2023
	Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Mortgage loans:
Commercial:
Greater than 2.0x	$	—	$	783	$	1,160	$	1,113	$	102	$	2,622	$	—	$	—	$	5,780
1.8x to 2.0x	—		94		180		164		288		600		242		94		1,662
1.5x to 1.8x	—		400		490		32		195		1,234		—		—		2,351
1.2x to 1.5x	307		1,041		194		—		—		854		—		—		2,396
1.0x to 1.2x	166		496		41		60		55		840		54		34		1,746

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	March 31, 2023
	Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Less than 1.0x	7		459		48		—		—		70		—		—		584
Total commercial	$	480	$	3,273	$	2,113	$	1,369	$	640	$	6,220	$	296	$	128	$	14,519

Agricultural:
Greater than 2.0x	$	2	$	51	$	40	$	61	$	21	$	189	$	—	$	—	$	364
1.8x to 2.0x	—		16		57		33		24		67		—		—		197
1.5x to 1.8x	6		69		31		110		18		213		—		—		447
1.2x to 1.5x	4		107		156		177		97		391		—		—		932
1.0x to 1.2x	5		90		80		60		29		310		—		—		574
Less than 1.0x	4		19		—		4		6		25		—		—		58
Total agricultural	$	21	$	352	$	364	$	445	$	195	$	1,195	$	—	$	—	$	2,572


Total mortgage loans:
Greater than 2.0x	$	2	$	834	$	1,200	$	1,174	$	123	$	2,811	$	—	$	—	$	6,144
1.8x to 2.0x	—		110		237		197		312		667		242		94		1,859
1.5x to 1.8x	6		469		521		142		213		1,447		—		—		2,798
1.2x to 1.5x	311		1,148		350		177		97		1,245		—		—		3,328
1.0x to 1.2x	171		586		121		120		84		1,150		54		34		2,320
Less than 1.0x	11		478		48		4		6		95		—		—		642
Total mortgage loans	$	501	$	3,625	$	2,477	$	1,814	$	835	$	7,415	$	296	$	128	$	17,091

_____________

(1)The LTV ratio is derived from current loan balance divided by the fair value of the property. The fair value of the underlying commercial properties is updated annually for each mortgage loan.

(2)The DSC ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

LTV Ratios (1)


	December 31, 2022
	Amortized Cost Basis by Origination Year
	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Mortgage loans:
Commercial:
0% - 50%	$	624	$	130	$	—	$	—	$	119	$	1,242	$	—	$	—	$	2,115
50% - 70%	2,285		1,569		906		313		623		2,254		328		—		8,278
70% - 90%	363		415		463		329		424		1,314		—		34		3,342
90% plus	—		—		—		—		35		233		—		—		268
Total commercial	$	3,272	$	2,114	$	1,369	$	642	$	1,201	$	5,043	$	328	$	34	$	14,003

Agricultural:
0% - 50%	$	163	$	182	$	228	$	129	$	132	$	725	$	—	$	—	$	1,559
50% - 70%	190		185		222		68		83		267		—		—		1,015
70% - 90%	—		—		—		—		—		16		—		—		16
90% plus	—		—		—		—		—		—		—		—		—
Total agricultural	$	353	$	367	$	450	$	197	$	215	$	1,008	$	—	$	—	$	2,590


Total mortgage loans:
0% - 50%	$	787	$	312	$	228	$	129	$	251	$	1,967	$	—	$	—	$	3,674
50% - 70%	2,475		1,754		1,128		381		706		2,521		328		—		9,293
70% - 90%	363		415		463		329		424		1,330		—		34		3,358
90% plus	—		—		—		—		35		233		—		—		268
Total mortgage loans	$	3,625	$	2,481	$	1,819	$	839	$	1,416	$	6,051	$	328	$	34	$	16,593

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

DSC Ratios (2)


	December 31, 2022
	Amortized Cost Basis by Origination Year
	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Mortgage loans:
Commercial:
Greater than 2.0x	$	771	$	1,159	$	1,113	$	102	$	571	$	1,911	$	—	$	—	$	5,627
1.8x to 2.0x	158		215		164		197		186		477		279		—		1,676
1.5x to 1.8x	337		390		32		153		176		1,175		4		—		2,267
1.2x to 1.5x	1,041		259		—		92		73		917		—		—		2,382
1.0x to 1.2x	507		43		60		98		160		492		45		34		1,439
Less than 1.0x	458		48		—		—		35		71		—		—		612
Total commercial	$	3,272	$	2,114	$	1,369	$	642	$	1,201	$	5,043	$	328	$	34	$	14,003

Agricultural:
Greater than 2.0x	$	51	$	40	$	62	$	21	$	12	$	193	$	—	$	—	$	379
1.8x to 2.0x	16		58		35		24		14		51		—		—		198
1.5x to 1.8x	69		42		111		18		19		196		—		—		455
1.2x to 1.5x	107		147		177		98		99		298		—		—		926
1.0x to 1.2x	91		80		61		30		60		257		—		—		579
Less than 1.0x	19		—		4		6		11		13		—		—		53
Total agricultural	$	353	$	367	$	450	$	197	$	215	$	1,008	$	—	$	—	$	2,590


Total mortgage loans:
Greater than 2.0x	$	822	$	1,199	$	1,175	$	123	$	583	$	2,104	$	—	$	—	$	6,006
1.8x to 2.0x	174		273		199		221		200		528		279		—		1,874
1.5x to 1.8x	406		432		143		171		195		1,371		4		—		2,722
1.2x to 1.5x	1,148		406		177		190		172		1,215		—		—		3,308
1.0x to 1.2x	598		123		121		128		220		749		45		34		2,018
Less than 1.0x	477		48		4		6		46		84		—		—		665
Total mortgage loans	$	3,625	$	2,481	$	1,819	$	839	$	1,416	$	6,051	$	328	$	34	$	16,593

_____________

(1)The LTV ratio is derived from current loan balance divided by the fair value of the property. The fair value of the underlying commercial properties is updated annually for each mortgage loan.

(2)The DSC ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.

Past-Due and Nonaccrual Mortgage Loan Status

The following table provides information relating to the aging analysis of past-due mortgage loans as of March 31, 2023 and December 31, 2022, respectively.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

Age Analysis of Past Due Mortgage Loans (1)


	Accruing Loans												Non-accruing Loans		Total Loans		Non-accruing Loans with No Allowance		Interest Income on Non-accruing Loans
	Past Due								Current		Total
	30-59 Days		60-89 Days		90 Days or More		Total
	(in millions)
March 31, 2023:
Mortgage loans:
Commercial	$	62	$	—	$	—	$	62	$	14,366	$	14,428	$	91	$	14,519	$	—	$	1
Agricultural	17		11		15		43		2,510		2,553		19		2,572		3		—
Total	$	79	$	11	$	15	$	105	$	16,876	$	16,981	$	110	$	17,091	$	3	$	1
December 31, 2022:
Mortgage loans:
Commercial	$	56	$	—	$	—	$	56	$	13,947	$	14,003	$	—	$	14,003	$	—	$	—
Agricultural	3		5		13		21		2,553		2,574		16		2,590		—		—
Total	$	59	$	5	$	13	$	77	$	16,500	$	16,577	$	16	$	16,593	$	—	$	—

_______________

(1)Amounts presented at amortized cost basis.

As of March 31, 2023 and December 31, 2022, the carrying values of problem mortgage loans that had been classified as non-accrual loans were $17 million and $14 million, respectively. The carrying values of those mortgage loans are presented net of an allowance of $2 million and $2 million, respectively, as of March 31, 2023 and December 31, 2022.

Troubled Debt Restructuring

During the three months ended March 31, 2023, we granted a modification to a $56 million commercial real estate loan, which is 0.3% of the mortgage loans on real estate. The modification reflects a pay and accrue structure where the loan was converted to interest only, and the pay rate is lower than the current rate beginning in 2023; 0.35% in 2023 and stepping up annually until it reaches the existing coupon of 5.0% in 2027. Interest between the pay rate and the coupon rate will be accrued and added to the loan monthly. Additionally, any excess cash flow above the pay rate will be applied to the loan. For the accounting policy pertaining to our TDRs see Note 2 of the Notes to these Consolidated Financial Statements.

During the three months ended March 31, 2022, the Company identified an immaterial amount of TDRs.

Equity Securities

The table below presents a breakdown of unrealized and realized gains and (losses) on equity securities during the three months ended March 31, 2023 and 2022.

Unrealized and Realized Gains (Losses) from Equity Securities


	Three Months Ended March 31,
			2023		2022
		(in millions)
Net investment gains (losses) recognized during the period on securities held at the end of the period			$	(1)	$	(39)
Net investment gains (losses) recognized on securities sold during the period			—		(11)
Unrealized and realized gains (losses) on equity securities			$	(1)	$	(50)

Trading Securities

As of March 31, 2023 and December 31, 2022, respectively, the fair value of the Company’s trading securities was $292 million and $283 million. As of March 31, 2023 and December 31, 2022, respectively, trading securities included the General Account’s investment in Separate Accounts had carrying values of $45 million and $38 million.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

The table below shows a breakdown of net investment income (loss) from trading securities during the three months ended March 31, 2023 and 2022:

Net Investment Income (Loss) from Trading Securities


	Three Months Ended March 31,
		2023		2022
		(in millions)
Net investment gains (losses) recognized during the period on securities held at the end of the period		$	13	$	(16)
Net investment gains (losses) recognized on securities sold during the period		(1)		—
Unrealized and realized gains (losses) on trading securities		12		(16)
Interest and dividend income from trading securities		2		2
Net investment income (loss) from trading securities		$	14	$	(14)

4) DERIVATIVES

The Company uses derivatives as part of its overall asset/liability risk management primarily to reduce exposures to equity market and interest rate risks. Derivative hedging strategies are designed to reduce these risks from an economic perspective and are all executed within the framework of a “Derivative Use Plan” approved by applicable states’ insurance law. Derivatives are generally not accounted for using hedge accounting, with the exception of TIPS and cash flow hedges, which are discussed further below. Operation of these hedging programs is based on models involving numerous estimates and assumptions, including, among others, mortality, lapse, surrender and withdrawal rates, election rates, fund performance, market volatility and interest rates. A wide range of derivative contracts are used in these hedging programs, including exchange traded equity, currency and interest rate futures contracts, total return and/or other equity swaps, interest rate swap and floor contracts, bond and bond-index total return swaps, swaptions, variance swaps and equity options, credit and foreign exchange derivatives, as well as bond and repo transactions to support the hedging. The derivative contracts are collectively managed in an effort to reduce the economic impact of unfavorable changes in guaranteed benefits’ exposures attributable to movements in capital markets. In addition, as part of its hedging strategy, the Company targets an asset level for all variable annuity products at or above a CTE98 level under most economic scenarios (CTE is a statistical measure of tail risk which quantifies the total asset requirement to sustain a loss if an event outside a given probability level has occurred. CTE98 denotes the financial resources a company would need to cover the average of the worst 2% of scenarios.)

Derivatives Utilized to Hedge Exposure to Variable Annuities with Guarantee Features

The Company has issued and continues to offer variable annuity products with GMxB features which are accounted for as market risk benefits. The risk associated with the GMDB feature is that under-performance of the financial markets could result in GMDB benefits, in the event of death, being higher than what accumulated policyholders’ account balances would support. The risk associated with the GMIB feature is that under-performance of the financial markets could result in the present value of GMIB, in the event of annuitization, being higher than what accumulated policyholders’ account balances would support, taking into account the relationship between current annuity purchase rates and the GMIB guaranteed annuity purchase rates. The risk associated with products that have a GMxB feature and are accounted for as market risk benefits is that under-performance of the financial markets could result in the GMxB features benefits being higher than what accumulated policyholders’ account balances would support.

For GMxB features, the Company retains certain risks including basis, credit spread and some volatility risk and risk associated with actual experience versus expected actuarial assumptions for mortality, lapse and surrender, withdrawal and policyholder election rates, among other things. The derivative contracts are managed to correlate with changes in the value of the GMxB features that result from financial markets movements. A portion of exposure to realized equity volatility is hedged using equity options and variance swaps and a portion of exposure to credit risk is hedged using total return swaps on fixed income indices. Additionally, the Company is party to total return swaps for which the reference U.S. Treasury securities are contemporaneously purchased from the market and sold to the swap counterparty. As these transactions result in a transfer of control of the U.S. Treasury securities to the swap

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

counterparty, the Company derecognizes these securities with consequent gain or loss from the sale. The Company has also purchased reinsurance contracts to mitigate the risks associated with GMDB features and the impact of potential market fluctuations on future policyholder elections of GMIB features contained in certain annuity contracts issued by the Company. The reinsurance of the GMIB features is accounted for as purchased market risk benefits. In addition, on June 1, 2021, we ceded legacy variable annuity policies sold by Equitable Financial between 2006-2008 (the “Block”), comprised of non-New York “Accumulator” policies containing fixed rate GMIB and/or GMDB guarantees to CS Life. As this contract provides full risk transfer and thus has the same risk attributes as the underlying direct contracts, the benefits of this treaty are accounted for in the same manner as the underlying gross reserves and therefore the Amounts Due from Reinsurers related to the GMIB with NLG are accounted for as purchased market risk benefits.

The Company has in place an economic hedge program using U.S. Treasury futures to partially protect the overall profitability of future variable annuity sales against declining interest rates.

Derivatives Utilized to Hedge Crediting Rate Exposure on SCS, SIO, MSO and IUL Products/Investment Options

The Company hedges crediting rates in the SCS variable annuity, SIO in the EQUI-VEST variable annuity series, MSO in the variable life insurance products and IUL insurance products. These products permit the contract owner to participate in the performance of an index, ETF or commodity price movement up to a cap for a set period of time. They also contain a protection feature, in which the Company will absorb, up to a certain percentage, the loss of value in an index, ETF or commodity price, which varies by product segment.

In order to support the returns associated with these features, the Company enters into derivative contracts whose payouts, in combination with fixed income investments, emulate those of the index, ETF or commodity price, subject to caps and buffers, thereby substantially reducing any exposure to market-related earnings volatility.

Derivatives Used to Hedge Equity Market Risks Associated with the General Account’s Seed Money Investments in Retail Mutual Funds

The Company’s General Account seed money investments in retail mutual funds expose us to market risk, including equity market risk which is partially hedged through equity-index futures contracts to minimize such risk.

Derivatives Used for General Account Investment Portfolio

The Company maintains a strategy in its General Account investment portfolio to replicate the credit exposure of fixed maturity securities otherwise permissible for investment under its investment guidelines through the sale of CDS. Under the terms of these swaps, the Company receives quarterly fixed premiums that, together with any initial amount paid or received at trade inception, replicate the credit spread otherwise currently obtainable by purchasing the referenced entity’s bonds of similar maturity. These credit derivatives generally have remaining terms of five years or less and are recorded at fair value with changes in fair value, including the yield component that emerges from initial amounts paid or received, reported in net derivative gains (losses).

The Company manages its credit exposure taking into consideration both cash and derivatives based positions and selects the reference entities in its replicated credit exposures in a manner consistent with its selection of fixed maturities. In addition, the Company generally transacts the sale of CDS in single name reference entities of investment grade credit quality and with counterparties subject to collateral posting requirements. If there is an event of default by the reference entity or other such credit event as defined under the terms of the swap contract, the Company is obligated to perform under the credit derivative and, at its option, either pay the referenced amount of the contract less an auction-determined recovery amount or pay the referenced amount of the contract and receive in return the defaulted or similar security of the reference entity for recovery by sale at the contract settlement auction. The Company purchased CDS to mitigate its exposure to a reference entity through cash positions. These positions do not replicate credit spreads.

To date, there have been no events of default or circumstances indicative of a deterioration in the credit quality of the named referenced entities to require or suggest that the Company will have to perform under the CDS that it sold. The maximum potential amount of future payments the Company could be required to make under the credit derivatives sold is limited to the par value of the referenced securities which is the dollar or euro-equivalent of the derivative’s notional amount. The Standard North American CDS Contract or Standard European Corporate Contract under which the Company executes these CDS sales transactions does not contain recourse provisions for recovery of amounts paid under the credit derivative.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

The Company purchased 30-year TIPS and other sovereign bonds, both inflation-linked and non-inflation linked, as General Account investments and enters into asset or cross-currency basis swaps, to result in payment of the given bond’s coupons and principal at maturity in the bond’s specified currency to the swap counterparty in return for fixed dollar amounts. These swaps, when considered in combination with the bonds, together result in a net position that is intended to replicate a dollar-denominated fixed-coupon cash bond with a yield higher than a term-equivalent U.S. Treasury bond.

Derivatives Utilized to Hedge Exposure to Foreign Currency Denominated Cash Flows

The Company purchases private placement debt securities and issues funding agreements in the FABN program in currencies other than its functional U.S. dollar currency. The Company enters into cross currency swaps with external counterparties to hedge the exposure of the foreign currency denominated cash flows of these instruments. The foreign currency received from or paid to the cross currency swap counterparty is exchanged for fixed U.S. dollar amounts with improved net investment yields or net product costs over equivalent U.S. dollar denominated instruments issued at that time. The transactions are accounted for as cash flow hedges when they are designated in hedging relationships and qualify for hedge accounting.

These cross currency swaps are for the period the foreign currency denominated private placement debt securities and funding agreement are outstanding, with the longest cross currency swap expiring in 2033. Since these cross currency swaps are designated and qualify as cash flow hedges, the corresponding interest accruals are recognized in Net investment income and in Interest credited to policyholders’ account balances.

The tables below present quantitative disclosures about the Company’s derivative instruments designated in hedging relationships and derivative instruments which have not been designated in hedging relationships, including those embedded in other contracts required to be accounted for as derivative instruments.

The following table presents the gross notional amount and estimated fair value of the Company’s derivatives:

Derivative Instruments by Category


	March 31, 2023						December 31, 2022
			Fair Value						Fair Value
	Notional Amount		Derivative Assets		Derivative Liabilities		Notional Amount		Derivative Assets		Derivative Liabilities
	(in millions)
Derivatives: designated for hedge accounting (1)
Cash flow hedges:
Currency swaps	$	1,580	$	98	$	87	$	1,431	$	99	$	85
Interest swaps	955		—		335		955		—		294
Total: designated for hedge accounting	2,535		98		422		2,386		99		379
Derivatives: not designated for hedge accounting (1)
Equity contracts:
Futures	4,101		—		—		4,320		—		—
Swaps	12,229		57		—		11,159		38		—
Options	50,395		8,620		2,876		39,863		7,549		3,396
Interest rate contracts:
Futures	12,191		—		—		12,693		—		—
Swaps	1,965		17		92		1,498		—		166
Credit contracts:
Credit default swaps	102		—		2		102		—		2
Currency contracts:
Currency swaps	548		4		10		397		4		13
Other freestanding contracts:
Margin	—		170		—		—		193		—
Collateral	—		149		5,135		—		142		4,469
Total: Not designated for hedge accounting	81,531		9,017		8,115		70,032		7,926		8,046

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	March 31, 2023						December 31, 2022
			Fair Value						Fair Value
	Notional Amount		Derivative Assets		Derivative Liabilities		Notional Amount		Derivative Assets		Derivative Liabilities
	(in millions)
Embedded derivatives:
SCS, SIO, MSO and IUL indexed features (2)	—		—		5,775		—		—		4,077
Total embedded derivatives	—		—		5,775		—		—		4,077

Total derivative instruments	$	84,066	$	9,115	$	14,312	$	72,418	$	8,025	$	12,502

______________

(1)Reported in other invested assets in the consolidated balance sheets.

(2)Reported in policyholders’ account balances in the consolidated balance sheets.

The following table presents the effects of derivative instruments on the consolidated statements of income and comprehensive income (loss).

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

Derivative Instruments by Category


	Three Months Ended March 31, 2023								Three Months Ended March 31, 2022
	Net Derivatives Gain (Losses) (1) (2)		NII (3)		Interest Credited To Policyholders Account Balances		AOCI		Net Derivatives Gain(Losses) (1) (2)		Interest Credited To Policyholders Account Balances		AOCI
	(in millions)
Derivatives: Designated for hedge accounting
Cash flow hedges:
Currency Swaps	$	7	$	3	$	(34)	$	25	$	(4)	$	(18)	$	13
Interest Swaps	(4)		—		—		(28)		(14)		—		(20)
Total: Designated for hedge accounting	3		3		(34)		(3)		(18)		(18)		(7)
Derivatives: Not designated for hedge accounting
Equity contracts:
Futures	(155)		—		—		—		59		—		—
Swaps	(603)		—		—		—		726		—		—
Options	1,496		—		—		—		(287)		—		—
Interest rate contracts:
Futures	(42)		—		—		—		(500)		—		—
Swaps	48		—		—		—		(149)		—		—
Credit contracts:
Credit default swaps	—		—		—		—		—		—		—
Currency contracts:
Currency swaps	(10)		—		—		—		5		—		—
Total: Not designated for hedge accounting	734		—		—		—		(146)		—		—

Embedded Derivatives:
SCS, SIO, MSO and IUL indexed features	(1,574)		—		—		—		311		—		—
Total Embedded Derivatives	(1,574)		—		—		—		311		—		—

Total derivatives instruments	$	(837)	$	3	$	(34)	$	(3)	$	147	$	(18)	$	(7)

______________

(1)Reported in net derivative gains (losses) in the consolidated statements of income (loss).

(2)For the three months ended March 31, 2023 and 2022, investment fees of $4 million and $3 million, respectively, are reported in net derivative gains (losses) in the consolidated statements of income (loss).

(3)Net Investment Income (“NII”).

The following table presents a roll-forward of cash flow hedges recognized in AOCI.

Roll-forward of Cash flow hedges in AOCI

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	Three Months Ended March 31,
		2023		2022
		(in millions)
Balance, beginning of the period		$	22	$	(208)
Amount recorded in AOCI
Currency swaps		(7)		(3)
Interest swaps		(37)		(39)
Total amount recorded in AOCI		(44)		(42)
Amount reclassified from AOCI to income
Currency swaps (1)		32		16
Interest swaps (1)		9		19
Total amount reclassified from AOCI to income		41		35
Balance, end of the period (2)		$	19	$	(215)

______________

(1) Currency swaps reclassified from AOCI to income are reported in net investment income in the consolidated statements of income (loss). Interest swaps reclassified from AOCI to income are reported in net derivative gains (losses) in the consolidated statements of income (loss).

(2) The Company does not estimate the amount of the deferred losses in AOCI at three months ended March 31, 2023 and 2022 which will be released and reclassified into Net income (loss) over the next 12 months as the amounts cannot be reasonably estimated.

Equity-Based and Treasury Futures Contracts Margin

All outstanding equity-based and treasury futures contracts as of March 31, 2023 and December 31, 2022 are exchange-traded and net settled daily in cash. As of March 31, 2023 and December 31, 2022, respectively, the Company had open exchange-traded futures positions on: (i) the S&P 500, Nasdaq, Russell 2000 and Emerging Market indices, having initial margin requirements of $196 million and $222 million, (ii) the 2-year, 5-year and 10-year U.S. Treasury Notes on U.S. Treasury bonds and ultra-long bonds, having initial margin requirements of $63 million and $103 million, and (iii) the Euro Stoxx, FTSE 100, Topix, ASX 200 and EAFE indices as well as corresponding currency futures on the Euro/U.S. dollar, Pound/U.S. dollar, Australian dollar/U.S. dollar, and Yen/U.S. dollar, having initial margin requirements of $16 million and $16 million.

Collateral Arrangements

The Company generally has executed a CSA under the ISDA Master Agreement it maintains with each of its OTC derivative counterparties that requires both posting and accepting collateral either in the form of cash or high-quality securities, such as U.S. Treasury securities, U.S. government and government agency securities and investment grade corporate bonds. The Company nets the fair value of all derivative financial instruments with counterparties for which an ISDA Master Agreement and related CSA have been executed. As of March 31, 2023 and December 31, 2022, respectively, the Company held $5.1 billion and $4.5 billion in cash and securities collateral delivered by trade counterparties, representing the fair value of the related derivative agreements. The unrestricted cash collateral is reported in other invested assets. The Company posted collateral of $149 million and $142 million as of March 31, 2023 and December 31, 2022, respectively, in the normal operation of its collateral arrangements. The Company is exposed to losses in the event of non-performance by counterparties to financial derivative transactions with a positive fair value. The Company manages credit risk by: (i) entering into derivative transactions with highly rated major international financial institutions and other creditworthy counterparties governed by master netting agreements, as applicable; (ii) trading through central clearing and OTC parties; (iii) obtaining collateral, such as cash and securities, when appropriate; and (iv) setting limits on single party credit exposures which are subject to periodic management review.

Substantially all of the Company’s derivative agreements have zero thresholds which require daily full collateralization by the party in a liability position. In addition, certain of the Company’s derivative agreements contain credit-risk related contingent features; if the credit rating of one of the parties to the derivative agreement is to fall below a certain level, the party with positive fair value could request termination at the then fair value or demand immediate full collateralization from the party whose credit rating fell and is in a net liability position.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

As of March 31, 2023 and December 31, 2022 there were no net liability derivative positions with counterparties with credit risk-related contingent features whose credit rating has fallen. All derivatives have been appropriately collateralized by the Company or the counterparty in accordance with the terms of the derivative agreements.

The following tables presents information about the Company’s offsetting of financial assets and liabilities and derivative instruments as of March 31, 2023 and December 31, 2022:

Offsetting of Financial Assets and Liabilities and Derivative Instruments

As of March 31, 2023


	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 (1)		Net Amount
	(in millions)
Assets:
Derivative assets	$	9,115	$	7,572	$	1,543	$	(945)	$	598
Other financial assets	1,578		—		1,578		—		1,578
Other invested assets	$	10,693	$	7,572	$	3,121	$	(945)	$	2,176

Liabilities:
Derivative liabilities	$	7,592	$	7,572	$	20	$	—	$	20
Other financial liabilities	4,592		—		4,592		—		4,592
Other liabilities	$	12,184	$	7,572	$	4,612	$	—	$	4,612

______________

(1)Financial instruments sent (held).

As of December 31, 2022


	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 (1)		Net Amount
	(in millions)
Assets:
Derivative assets	$	8,024	$	6,980	$	1,044	$	(848)	$	196
Other financial assets	1,791		—		1,791		—		1,791
Other invested assets	$	9,815	$	6,980	$	2,835	$	(848)	$	1,987

Liabilities:
Derivative liabilities	$	7,577	$	6,980	$	597	$	—	$	597
Other financial liabilities	4,588		—		4,588		—		4,588
Other liabilities	$	12,165	$	6,980	$	5,185	$	—	$	5,185

______________

(1)Financial instruments sent (held).

5) CLOSED BLOCK

As a result of demutualization, the Company’s Closed Block was established in 1992 for the benefit of certain individual participating policies that were in force on that date. Assets, liabilities and earnings of the Closed Block are specifically identified to support its participating policyholders.

Assets allocated to the Closed Block inure solely to the benefit of the Closed Block policyholders and will not revert to the benefit of the Company. No reallocation, transfer, borrowing or lending of assets can be made between the Closed Block and other portions of the Company’s General Account, any of its Separate Accounts or any affiliate of the Company without the approval of the New York State Department of Financial Services (the “NYDFS”). Closed Block assets and liabilities are carried on the same basis as similar assets and liabilities held in the General Account. For more information on the Closed Block, see Note 5 to the Company’s consolidated financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2022.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

Summarized financial information for the Company’s Closed Block is as follows:



	March 31, 2023		December 31, 2022
	(in millions)
Closed Block Liabilities:
Future policy benefits, policyholders’ account balances and other	$	5,626	$	5,692
Policyholder dividend obligation	—		—
Other liabilities	102		68
Total Closed Block liabilities	5,728		5,760

Assets Designated to the Closed Block:
Fixed maturities AFS, at fair value (amortized cost of $3,117 and $3,171) (allowance for credit losses of $0 and $0)	2,945		2,948
Mortgage loans on real estate (net of allowance for credit losses of $5 and $4)	1,647		1,645
Policy loans	561		569
Cash and other invested assets	2		—
Other assets	201		187
Total assets designated to the Closed Block	5,356		5,349

Excess of Closed Block liabilities over assets designated to the Closed Block	372		411
Amounts included in AOCI:
Net unrealized investment gains (losses), net of policyholders’ dividend obligation: $0 and $0; and net of income tax: $36 and $47	(136)		(177)
Maximum future earnings to be recognized from Closed Block assets and liabilities	$	236	$	234

The Company’s Closed Block revenues and expenses were as follows:


	Three Months Ended March 31,
		2023		2022
		(in millions)
Revenues:
Premiums and other income		$	30	$	33
Net investment income (loss)		51		58
Investment gains (losses), net		—		1
Total revenues		81		92

Benefits and Other Deductions:
Policyholders’ benefits and dividends		83		76
Other operating costs and expenses		—		—
Total benefits and other deductions		83		76
Net income (loss), before income taxes		(2)		16
Income tax (expense) benefit		(1)		(2)
Net income (loss)		$	(3)	$	14

6) DAC AND OTHER DEFERRED ASSETS/LIABILITIES

Changes in the DAC asset for the three months ended March 31, 2023 and 2022 were as follows:

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	Term		UL		VUL		IUL		GMxB Core		EI		IE		SCS		GMxB Legacy		EG		Momentum		CB		Total
	(in millions)
Balance, beginning of the period	$	362	$	20	$	112	$	—	$	1,585	$	156	$	147	$	1,266	$	213	$	711	$	89	$	127	$	4,788
Capitalization	4		1		17		—		10		3		6		58		7		16		3		—		125
Amortization	(10)		—		(2)		—		(34)		(3)		(3)		(45)		(6)		(11)		(5)		(3)		(122)
Balance, March 31, 2023	$	356	$	21	$	127	$	—	$	1,561	$	156	$	150	$	1,279	$	214	$	716	$	87	$	124	$	4,791


	Term		UL		VUL		GMxB Core		EI		IE		SCS		GMxB Legacy		EG		Momentum		CB		Total
	(in millions)
Balance, beginning of the period	$	385	$	14	$	50	$	1,639	$	156	$	121	$	1,070	$	209	$	678	$	94	$	138	$	4,554
Capitalization	4		2		20		26		3		9		88		8		18		4		—		182
Amortization	(10)		—		(1)		(33)		(3)		(3)		(40)		(5)		(10)		(5)		(3)		(113)
Balance, March 31, 2022	$	379	$	16	$	69	$	1,632	$	156	$	127	$	1,118	$	212	$	686	$	93	$	135	$	4,623

_______________

(1) DAC amortization of $2 million related to Other not reflected in table above.

Changes in the Sales Inducement Assets for the three months ended March 31, 2023 and 2022 were as follows:


	Three Months Ended March 31,
	2023				2022
	GMxB Core		GMxB Legacy		GMxB Core		GMxB Legacy
	(in millions)
Balance, beginning of the period	$	137	$	200	$	147	$	222

Amortization	(3)		(5)		(3)		(5)
Balance, end of the period	$	134	$	195	$	144	$	217

Changes in the Unearned Revenue Liability for the three months ended March 31, 2023 and 2022 were as follows:


	Three Months Ended March 31,
	2023				2022
	UL		VUL			UL		VUL
	(in millions)
Balance, beginning of the period	$	95	$	525		$	80	$	501
Capitalization	5		14			5		14
Amortization	(2)		(8)			(1)		(8)
Balance, end of the period	$	98	$	531		$	84	$	507

The following table presents a reconciliation of DAC to the consolidated balance sheet as of March 31, 2023 and December 31, 2022

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued



	March 31, 2023		December 31, 2022
	(in millions)
Term	$	356	$	362
UL	21		20
VUL	127		112
IUL	—		—
GMxB Core	1,561		1,585
EQUI-VEST Individual	156		156
Investment Edge	150		147
SCS	1,279		1,266
EQUI-VEST Group	716		711
Momentum	87		89
GMxB Legacy	214		127
Closed Block	124		213
Other	26		26
Total	$	4,817	$	4,814

Annually, or as circumstances warrant, we will review the associated decrements assumptions. (i.e. mortality and lapse) based on our multi-year average of companies experience with actuarial judgements to reflect other observable industry trends. In addition to DAC, the Unearned Revenue Liability and Sales Inducement Asset (“SIA”) use similar techniques and quarterly update processes for balance amortization.

7) FAIR VALUE DISCLOSURES

U.S. GAAP establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value, and identifies three levels of inputs that may be used to measure fair value:

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.

The Company uses unadjusted quoted market prices to measure fair value for those instruments that are actively traded in financial markets. In cases where quoted market prices are not available, fair values are measured using present value or other valuation techniques. The fair value determinations are made at a specific point in time, based on available market information and judgments about the financial instrument, including estimates of the timing and amount of expected future cash flows and the credit standing of counterparties. Such adjustments do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument, nor do they consider the tax impact of the realization of unrealized gains or losses. In many cases, the fair value cannot be substantiated by direct comparison to independent markets, nor can the disclosed value be realized in immediate settlement of the instrument.

Management is responsible for the determination of the value of investments carried at fair value and the supporting methodologies and assumptions. Under the terms of various service agreements, the Company often utilizes independent valuation service providers to gather, analyze, and interpret market information and derive fair values based upon relevant methodologies and assumptions for individual securities. These independent valuation service providers typically obtain data about market transactions and other key valuation model inputs from multiple sources and, through the use of widely accepted valuation models, provide a single fair value measurement for individual securities for which a fair value has been requested. As further described below with respect to specific asset classes,

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

these inputs include, but are not limited to, market prices for recent trades and transactions in comparable securities, benchmark yields, interest rate yield curves, credit spreads, quoted prices for similar securities, and other market-observable information, as applicable. Specific attributes of the security being valued also are considered, including its term, interest rate, credit rating, industry sector, and when applicable, collateral quality and other security- or issuer-specific information. When insufficient market observable information is available upon which to measure fair value, the Company either will request brokers knowledgeable about these securities to provide a non-binding quote or will employ internal valuation models. Fair values received from independent valuation service providers and brokers and those internally modeled or otherwise estimated are assessed for reasonableness.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Fair value measurements are required on a non-recurring basis for certain assets only when an impairment or other events occur. As of March 31, 2023 and December 31, 2022, no assets or liabilities were required to be measured at fair value on a non-recurring basis.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis are summarized below.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

Fair Value Measurements as of March 31, 2023


	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:
Investments:
Fixed maturities, AFS:
Corporate (1)	$	—	$	38,235	$	1,914	$	40,149
U.S. Treasury, government and agency	—		5,975		—		5,975
States and political subdivisions	—		466		28		494
Foreign governments	—		867		—		867
Residential mortgage-backed (2)	—		801		—		801
Asset-backed (3)	—		8,155		12		8,167
Commercial mortgage-backed	—		3,196		34		3,230
Redeemable preferred stock	—		43		—		43
Total fixed maturities, AFS	—		57,738		1,988		59,726
Other equity investments	145		467		9		621
Trading securities	172		120		—		292
Other invested assets:
Short-term investments	—		313		—		313
Assets of consolidated VIEs/VOEs	—		—		4		4
Swaps	—		(347)		—		(347)
Credit default swaps	—		(2)		—		(2)
Options	—		5,744		—		5,744
Total other invested assets	—		5,708		4		5,712
Cash equivalents	1,299		263		—		1,562
Purchased market risk benefits	—		—		10,743		10,743
Assets for market risk benefits	—		—		612		612
Separate Accounts assets (4)	112,723		2,550		1		115,274
Total Assets	$	114,339	$	66,846	$	13,357	$	194,542

Liabilities:
SCS, SIO, MSO and IUL indexed features’ liability	—		5,775		—		5,775
Liabilities for market risk benefits	—		—		15,047		15,047
Total Liabilities	$	—	$	5,775	$	15,047	$	20,822

______________

(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, credit risk transfer securities and other asset types.

(4)Separate Accounts 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. As of March 31, 2023 the fair value of such investments was $425 million.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

Fair Value Measurements as of December 31, 2022


	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:
Investments:
Fixed maturities, AFS:
Corporate (1)	$	—	$	37,360	$	2,103	$	39,463
U.S. Treasury, government and agency	—		5,738		—		5,738
States and political subdivisions	—		442		29		471
Foreign governments	—		836		—		836
Residential mortgage-backed (2)	—		777		—		777
Asset-backed (3)	—		8,449		—		8,449
Commercial mortgage-backed	—		3,138		32		3,170
Redeemable preferred stock	—		43		—		43
Total fixed maturities, AFS	—		56,783		2,164		58,947
Other equity investments	137		478		12		627
Trading securities	160		123		—		283
Other invested assets:
Short-term investments	—		485		—		485
Assets of consolidated VIEs/VOEs	—		—		5		5
Swaps	—		(416)		—		(416)
Credit default swaps	—		(2)		—		(2)
Options	—		4,153		—		4,153
Total other invested assets	—		4,220		5		4,225
Cash equivalents	397		258		—		655
Purchased market risk benefits	—		—		10,490		10,490
Assets for market risk benefits	—		—		478		478
Separate Accounts assets (4)	108,378		2,429		1		110,808
Total Assets	$	109,072	$	64,291	$	13,150	$	186,513

Liabilities:
SCS, SIO, MSO and IUL indexed features’ liability	—		4,077		—		4,077
Liabilities for market risk benefits	—		—		15,751		15,751
Total Liabilities	$	—	$	4,077	$	15,751	$	19,828

______________

(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, credit risk transfer securities and other asset types.

(4)Separate Accounts 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. As of December 31, 2022 the fair value of such investments was $456 million.

Public Fixed Maturities

The fair values of the Company’s public fixed maturities are generally based on prices obtained from independent valuation service providers and for which the Company maintains a vendor hierarchy by asset type based on historical pricing experience and vendor expertise. Although each security generally is priced by multiple independent valuation service providers, the Company ultimately uses the price received from the independent valuation service provider highest in the vendor hierarchy based on the respective asset type, with limited exception. To validate reasonableness, prices also are internally reviewed by those with relevant expertise through comparison with directly observed recent

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

market trades. Consistent with the fair value hierarchy, public fixed maturities validated in this manner generally are reflected within Level 2, as they are primarily based on observable pricing for similar assets and/or other market observable inputs.

Private Fixed Maturities

The fair values of the Company’s private fixed maturities are determined from prices obtained from independent valuation service providers. Prices not obtained from an independent valuation service provider are determined by using a discounted cash flow model or a market comparable company valuation technique. In certain cases, these models use observable inputs with a discount rate based upon the average of spread surveys collected from private market intermediaries who are active in both primary and secondary transactions, taking into account, among other factors, the credit quality and industry sector of the issuer and the reduced liquidity associated with private placements. Generally, these securities have been reflected within Level 2. For certain private fixed maturities, the discounted cash flow model or a market comparable company valuation technique may also incorporate unobservable inputs, which reflect the Company’s own assumptions about the inputs market participants would use in pricing the asset. To the extent management determines that such unobservable inputs are significant to the fair value measurement of a security, a Level 3 classification generally is made.

Freestanding Derivative Positions

The net fair value of the Company’s freestanding derivative positions as disclosed in Note 4 of the Notes to these Consolidated Financial Statements are generally based on prices obtained either from independent valuation service providers or derived by applying market inputs from recognized vendors into industry standard pricing models. The majority of these derivative contracts are traded in the OTC derivative market and are classified in Level 2. The fair values of derivative assets and liabilities traded in the OTC market are determined using quantitative models that require use of the contractual terms of the derivative instruments and multiple market inputs, including interest rates, prices, and indices to generate continuous yield or pricing curves, including overnight index swap curves, and volatility factors, which then are applied to value the positions. The predominance of market inputs is actively quoted and can be validated through external sources or reliably interpolated if less observable.

Level Classifications of the Company’s Financial Instruments

Financial Instruments Classified as Level 1

Investments classified as Level 1 primarily include redeemable preferred stock, trading securities, cash equivalents and Separate Accounts assets. Fair value measurements classified as Level 1 include exchange-traded prices of fixed maturities, equity securities and derivative contracts, and net asset values for transacting subscriptions and redemptions of mutual fund shares held by Separate Accounts. Cash equivalents classified as Level 1 include money market accounts, overnight commercial paper and highly liquid debt instruments purchased with an original maturity of three months or less and are carried at cost as a proxy for fair value measurement due to their short-term nature.

Financial Instruments Classified as Level 2

Investments classified as Level 2 are measured at fair value on a recurring basis and primarily include U.S. government and agency securities and certain corporate debt securities, such as public and private fixed maturities. As market quotes generally are not readily available or accessible for these securities, their fair value measures are determined utilizing relevant information generated by market transactions involving comparable securities and often are based on model pricing techniques that effectively discount prospective cash flows to present value using appropriate sector-adjusted credit spreads commensurate with the security’s duration, also taking into consideration issuer-specific credit quality and liquidity.

Observable inputs generally used to measure the fair value of securities classified as Level 2 include benchmark yields, reported secondary trades, issuer spreads, benchmark securities and other reference data. Additional observable inputs are used when available, and as may be appropriate, for certain security types, such as prepayment, default, and collateral information for the purpose of measuring the fair value of mortgage- and asset-backed securities. The Company’s AAA-rated mortgage- and asset-backed securities are classified as Level 2 for which the observability of market inputs to their pricing models is supported by sufficient, albeit more recently contracted, market activity in these sectors.

Certain Company products, such as the SCS, EQUI-VEST variable annuity products, IUL and the MSO fund available in some life contracts offer investment options which permit the contract owner to participate in the performance of an

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

index, ETF or commodity price. These investment options, which depending on the product and on the index selected can currently have one, three, five or six year terms, provide for participation in the performance of specified indices, ETF or commodity price movement up to a segment-specific declared maximum rate. Under certain conditions that vary by product, e.g., holding these segments for the full term, these segments also shield policyholders from some or all negative investment performance associated with these indices, ETF or commodity prices. These investment options have defined formulaic liability amounts, and the current values of the option component of these segment reserves are classified as Level 2 embedded derivatives. The fair values of these embedded derivatives are based on data obtained from independent valuation service providers.

Financial Instruments Classified as Level 3

The Company’s investments classified as Level 3 primarily include corporate debt securities, such as private fixed maturities and asset-backed securities. Determinations to classify fair value measures within Level 3 of the valuation hierarchy generally are based upon the significance of the unobservable factors to the overall fair value measurement. Included in the Level 3 classification are fixed maturities with indicative pricing obtained from brokers that otherwise could not be corroborated to market observable data.

The Company has certain variable annuity contracts with GMDB, GMIB, GIB and GWBL and other features in-force that guarantee one of the following:

•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.

The Company also issues certain benefits on its variable annuity products that are accounted for as market risk benefits carried at fair value and are also considered Level 3 for fair value leveling.

The GMIBNLG feature allows the policyholder to receive guaranteed minimum lifetime annuity payments based on predetermined annuity purchase rates applied to the contract’s benefit base if and when the contract account value is depleted and the NLG feature is activated. The optional GMIB feature allows the policyholder to receive guaranteed minimum lifetime annuity payments based on predetermined annuity purchase rates.

The GMWB feature allows the policyholder to withdraw at minimum, over the life of the contract, an amount based on the contract’s benefit base. The GWBL feature allows the policyholder to withdraw, each year for the life of the contract, a specified annual percentage of an amount based on the contract’s benefit base. The GMAB feature increases the contract account value at the end of a specified period to a GMAB base. The GIB feature provides a lifetime annuity based on predetermined annuity purchase rates if and when the contract account value is depleted. This lifetime annuity is based on predetermined annuity purchase rates applied to a GIB base. The GMDB feature guarantees that the benefit paid upon death will not be less than a guaranteed benefit base. If the contract’s account value is less than the benefit base at the time a death claim is paid, the amount payable will be equal to the benefit base.

Purchased MRB assets, which are accounted for as market risk benefits carried at fair value are also considered Level 3 for fair value leveling. The Purchased MRB asset fair value reflects the present value of reinsurance premiums, net of recoveries, adjusted for risk margins and nonperformance risk over a range of market consistent economic scenarios while the MRB asset and liability reflects the present value of expected future payments (benefits) less fees, adjusted for risk margins and nonperformance risk, attributable to the MRB liability over a range of market-consistent economic scenarios.

The valuations of the Purchased MRB assets incorporate significant non-observable assumptions related to policyholder behavior, risk margins and projections of equity Separate Accounts funds. The credit risks of the

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

counterparty and of the Company are considered in determining the fair values of its Purchased MRB asset after taking into account the effects of collateral arrangements. Incremental adjustment to the risk free curve for counterparty non-performance risk is made to the fair values of the Purchased MRB assets. Risk margins were applied to the non-capital markets inputs to the Purchased MRB valuations.

After giving consideration to collateral arrangements, the Company reduced the fair value of its Purchased MRB asset by $1.3 billion and $1.1 billion as of March 31, 2023 and December 31, 2022, respectively, to recognize incremental counterparty non-performance risk.

The Company’s consolidated VIEs/VOEs hold investments that are classified as Level 3, primarily corporate bonds that are vendor priced with no ratings available, bank loans, non-agency collateralized mortgage obligations and asset-backed securities.

Transfers of Financial Instruments Between Levels 2 and 3

During the three months ended March 31, 2023, fixed maturities with fair values of $258 million were transferred out of Level 3 and into Level 2 principally due to the availability of trading activity and/or market observable inputs to measure and validate their fair values. In addition, fixed maturities with fair value of $0 million were transferred from Level 2 into the Level 3 classification. These transfers in the aggregate represent approximately 21.0% of total equity as of March 31, 2023.

During the three months ended March 31, 2022, fixed maturities with fair values of $8 million were transferred out of Level 3 and into Level 2 principally due to the availability of trading activity and/or market observable inputs to measure and validate their fair values. In addition, fixed maturities with fair value of $70 million were transferred from Level 2 into the Level 3 classification. These transfers in the aggregate represent approximately 1.3% of total equity as of March 31, 2022.

The tables below present reconciliations for all Level 3 assets and liabilities and changes in unrealized gains (losses) for the three months ended March 31, 2023 and 2022, respectively. Not included below are the changes in balances related to market risk benefits and purchased market risk level 3 assets and liabilities, which are included in Note 9 of the Notes to these Consolidated Financial Statements.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued



	Corporate		State and Political Subdivisions		CMBS		Asset-backed
	(in millions)
Balance, January 1, 2023	$	2,103	$	29	$	32	$	—
Total gains and (losses), realized and unrealized, included in:
Net income (loss) as:
Net investment income (loss)	1		—		—		—
Investment gains (losses), net	(3)		—		—		—
Subtotal	(2)		—		—		—
Other comprehensive income (loss)	18		—		—		—
Purchases	143		—		2		12
Sales	(90)		(1)		—		—
Activity related to consolidated VIEs/VOEs	—		—		—		—
Transfers into Level 3 (1)	—		—		—		—
Transfers out of Level 3 (1)	(258)		—		—		—
Balance, March 31, 2023	$	1,914	$	28	$	34	$	12
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	17	$	—	$	—	$	—

Balance, January 1, 2022	$	1,493	$	35	$	20	$	8
Total gains and (losses), realized and unrealized, included in:
Net income (loss) as:
Net investment income (loss)	1		—		—		—
Investment gains (losses), net	1		—		—		—
Subtotal	2		—		—		—
Other comprehensive income (loss)	(30)		(3)		(1)		—
Purchases	231		—		219		325
Sales	(86)		—		—		(1)
Activity related to consolidated VIEs/VOEs	—		—		—		—
Transfers into Level 3 (1)	70		—		—		—
Transfers out of Level 3 (1)	(8)		—		—		—
Balance, March 31, 2022	$	1,672	$	32	$	238	$	332
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	(28)	$	(2)	$	(1)	$	—

_______________

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.

(2)For instruments held as of March 31, 2023andMarch 31, 2022amounts are included in net investment income or net derivative gains (losses) in the consolidated statements of income (loss) or unrealized gains (losses) on investments in the consolidated statements of comprehensive income.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued



	Other Equity Investments (3)		Separate Accounts Assets
	(in millions)
Balance, January 1, 2023	$	17	$	1
Realized and unrealized gains (losses), included in Net income (loss) as:
Investment gains (losses), reported in net investment income	(3)		—
Net derivative gains (losses)	—		—
Total realized and unrealized gains (losses)	(3)		—
Other comprehensive income (loss)	—		—
Purchases	—		—
Sales	—		—
Change of estimate	—		—
Activity related to consolidated VIEs/VOEs	—		—
Transfers into Level 3 (1)	—		—
Transfers out of Level 3 (1)	—		—
Balance, March 31, 2023	$	14	$	1
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	(3)	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	—	$	—

Balance, January 1, 2022	$	13	$	1
Realized and unrealized gains (losses), included in Net income (loss) as:
Investment gains (losses), reported in net investment income	—		—
Net derivative gains (losses)	—		—
Total realized and unrealized gains (losses)	—		—
Other comprehensive income (loss)	—		—
Purchases	—		—
Sales	—		(1)
Other	—		—
Activity related to consolidated VIEs/VOEs	(2)		—
Transfers into Level 3 (1)	—		—
Transfers out of Level 3 (1)	—		—
Balance, March 31, 2022	$	11	$	—
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	—	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	—	$	—

_______________

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.

(2)For instruments held as of March 31, 2023 and March 31, 2022, amounts are included in net investment income or net derivative gains (losses) in the consolidated statements of income (loss) or unrealized gains (losses) on investments in the consolidated statements of comprehensive income.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

(3)Other Equity Investments include other invested assets.

Quantitative and Qualitative Information about Level 3 Fair Value Measurements

The following tables disclose quantitative information about Level 3 fair value measurements by category for assets and liabilities as of March 31, 2023 and December 31, 2022, respectively.

Quantitative Information about Level 3 Fair Value Measurements as of March 31, 2023

Fair
Value

Valuation Technique

Significant
Unobservable Input

Range

Weighted Average (2)

( in millions)

Assets:

Investments:

Fixed maturities, AFS:

Corporate

468

Matrix pricing model

Spread over Benchmark

20 bps - 270 bps

175 bps

1,001

Market comparable companies

EBITDA multiples

Discount Rate

Cash flow Multiples

Loan to Value

5.3x - 31.5x

8.3% - 24.8%

0.5x - 11.0x

0.0% - 68.7%

14.7x

10.0%

6.8x

0.9%

Other equity investments

Discounted Cash Flow

Earnings Multiple

7.0x - 11.0x

9.2x

Purchased MRB asset (1) (2) (4)

10,743

Discounted cash flow

Lapse rates

Withdrawal rates

GMIB Utilization Rates

Non-performance risk

Volatility rates - Equity

Mortality: Ages 0-40

Ages 41-60

Ages 61-115

0.26% - 26.23%

0.06% - 10.93%

0.04% - 66.66%

65 bps - 149 bps

17% - 26%

0.01% - 0.17%

0.06% - 0.52%

0.32% - 40.00%

1.52%

0.70%

7.42%

69 bps

22%

2.85%

(same for all ages)

Liabilities:

Direct MRB (1) (2) (3) (4)

14,435

Discounted cash flow

Non-performance risk

Lapse rates

Withdrawal rates

Annuitization

Mortality (1): Ages 0-40

Ages 41-60

Ages 61-115

191 bps

0.26% - 35.42%

0.00% - 10.93%

0.04% - 100.00%

0.01% - 0.17%

0.06% - 0.52%

0.32% - 40.00%

191 bps

2.73%

0.62%

4.95%

2.16%

(same for all ages)

______________

(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.

(2)For lapses, withdrawals, and utilizations the rates were weighted by counts, for mortality weighted average rates are shown for all ages combined and for withdrawals the weighted averages were based on an estimated split of partial withdrawal and dollar-for-dollar withdrawals.

(3)MRB liabilities are shown net of MRB assets. Net amount is made up of $15.0 billion of MRB liabilities and $612 million of MRB assets.

(4)Includes Legacy and Core products.

Quantitative Information about Level 3 Fair Value Measurements as of December 31, 2022

Fair

Value

Valuation Technique

Significant

Unobservable Input

Range

Weighted Average (2)

(in millions)

Assets:

Investments:

Fixed maturities, AFS:

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

Corporate

413

Matrix pricing model

Spread over benchmark

20 - 797 bps

204 bps

1,029

Market comparable companies

EBITDA multiples
Discount rate

Cash flow multiples

Loan to Value

5.3x - 35.8x

9.0% - 45.7%

0.0x -10.3x

0.0%-40.4%

13.6x

11.9%

6.1x

12.0%

Other equity investments

Market comparable companies

Revenue multiple

0.5x - 10.8x

2.4x

Purchased MRB asset (1) (2) (4)

10,490

Discounted cash flow

Lapse rates

Withdrawal rates

GMIB utilization rates

Non-performance risk (bps)

Volatility rates - Equity

Mortality: Ages 0-40

Ages 41 - 60

Ages 61 - 115

0.26% - 26.23%

0.06%-10.93%

0.04%-66.66%

54 bps - 124 bps

14%-32%

0.01%-0.17%

0.06%-0.52%

0.32%-40.00%

1.58%

0.69%

7.39%

69 bps

24%

2.87%

(same for all ages)

Liabilities:

Direct MRB (1) (2) (3) (4)

15,273

Discounted cash flow

Non-performance risk

Lapse rates

Withdrawal rates

Annuitization rates

Mortality: Ages 0-40

Ages 41 - 60

Ages 61 - 115

157 bps

0.26%-35.42%

0.00%-10.93%

0.04%-100.00%

0.01%-0.17%

0.06%-0.52%

0.32%-40.00%

157 bps

2.97%

0.68%

5.50%

2.41%

(same for all ages)

______________

(2)Lapses and pro-rata withdrawal rates were developed as a function of the policy account value. Dollar for dollar withdrawal rates were developed as a function of the dollar for dollar threshold, the dollar for dollar limit. GMIB utilization rates were developed as a function of the GMIB benefit base.

(3)MRB liabilities are shown net of MRB assets. Net amount is made up of $15.8 billion of MRB liabilities and $478 million of MRB assets.

(4)Includes Legacy and Core products.

Level 3 Financial Instruments for which Quantitative Inputs are Not Available

Certain Privately Placed Debt Securities with Limited Trading Activity

Excluded from the tables above as of March 31, 2023 and December 31, 2022, respectively, are approximately $531 million and $736 million of Level 3 fair value measurements of investments for which the underlying quantitative inputs are not developed by the Company and are not readily available. These investments primarily consist of certain privately placed debt securities with limited trading activity, including residential mortgage- and asset-backed instruments, and their fair values generally reflect unadjusted prices obtained from independent valuation service providers and indicative, non-binding quotes obtained from third-party broker-dealers recognized as market participants. Significant increases or decreases in the fair value amounts received from these pricing sources may result in the Company’s reporting significantly higher or lower fair value measurements for these Level 3 investments.

•The fair value of private placement securities is determined by application of a matrix pricing model or a market comparable company value technique. The significant unobservable input to the matrix pricing model valuation technique is the spread over the industry-specific benchmark yield curve. Generally, an increase or decrease in spreads would lead to directionally inverse movement in the fair value measurements of these securities. The significant unobservable input to the market comparable company valuation technique is the discount rate. Generally, a significant increase (decrease) in the discount rate would result in significantly lower (higher) fair value measurements of these securities.

•Residential mortgage-backed securities classified as Level 3 primarily consist of non-agency paper with low trading activity. Included in the tables above as of March 31, 2023 and December 31, 2022, there were no Level 3 securities that were determined by application of a matrix pricing model and for which the spread over the U.S. Treasury curve is the most significant unobservable input to the pricing result. Generally, a

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

change in spreads would lead to directionally inverse movement in the fair value measurements of these securities.

•Asset-backed securities classified as Level 3 primarily consist of non-agency mortgage loan trust certificates, including subprime and Alt-A paper, credit risk transfer securities, and equipment financings. Included in the tables above as of March 31, 2023 and December 31, 2022, there were no securities that were determined by the application of matrix-pricing for which the spread over the U.S. Treasury curve is the most significant unobservable input to the pricing result. Significant increases (decreases) in spreads would have resulted in significantly lower (higher) fair value measurements.

Market Risk Benefits

Significant unobservable inputs with respect to the fair value measurement of the Purchased MRB assets and the MRB liabilities identified in the table above are developed using Company data. Future Policyholder behavior is an unobservable market assumption and as such all aspects of policy holder behavior are derived based on recent historical experience. These policyholder behaviors include lapses, pro-rata withdrawals, dollar for dollar withdrawals, GMIB utilization, deferred mortality and payout phase mortality. Many of these policyholder behaviors have dynamic adjustment factors based on the relative value of the rider as compared to the account value in different economic environments. This applies to all variable annuity related products; products with GMxB riders including but not limited to GMIB, GMDB and GWL.

Lapse rates are adjusted at the contract level based on a comparison of the value of the embedded GMxB rider. and the current policyholder account value, which include other factors such as considering surrender charges. Generally, lapse rates are assumed to be lower in periods when a surrender charge applies. A dynamic lapse function reduces the base lapse rate when the guaranteed amount is greater than the account value as in-the-money contracts are less likely to lapse. For valuing Purchased MRB assets and MRB liabilities, lapse rates vary throughout the period over which cash flows are projected.

Carrying Value of Financial Instruments Not Otherwise Disclosed in Note 3 and Note 4 of the Notes to these Consolidated Financial Statements

The carrying values and fair values as of March 31, 2023 and December 31, 2022 for financial instruments not otherwise disclosed in Note 3 and Note 4 of the Notes to these Consolidated Financial Statements are presented in the table below:

Carrying Values and Fair Values for Financial Instruments Not Otherwise Disclosed


	Carrying Value		Fair Value
			Level 1		Level 2		Level 3		Total
	(in millions)
March 31, 2023:
Mortgage loans on real estate	$	16,952	$	—	$	—	$	15,252	$	15,252
Policy loans	$	3,556	$	—	$	—	$	3,891	$	3,891
Loans to affiliates	$	1,900	$	—	$	1,765	$	—	$	1,765
Policyholders’ liabilities: Investment contracts	$	1,733	$	—	$	—	$	1,605	$	1,605
FHLB funding agreements	$	8,369	$	—	$	8,285	$	—	$	8,285
FABN funding agreements	$	7,367	$	—	$	6,850	$	—	$	6,850
Separate Accounts liabilities	$	10,669	$	—	$	—	$	10,669	$	10,669

December 31, 2022:
Mortgage loans on real estate	$	16,464	$	—	$	—	$	14,675	$	14,675
Policy loans	$	3,563	$	—	$	—	$	3,850	$	3,850
Loans to affiliates	$	1,900	$	—	$	1,755	$	—	$	1,755
Policyholders’ liabilities: Investment contracts	$	1,801	$	—	$	—	$	1,645	$	1,645
FHLB funding agreements	$	8,505	$	—	$	8,390	$	—	$	8,390
FABN funding agreements	$	7,095	$	—	$	6,384	$	—	$	6,384
Separate Accounts liabilities	$	10,236	$	—	$	—	$	10,236	$	10,236

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

Mortgage Loans on Real Estate

Fair values for commercial and agricultural mortgage loans on real estate are measured by discounting future contractual cash flows to be received on the mortgage loan using interest rates at which loans with similar characteristics and credit quality would be made. The discount rate is derived based on the appropriate U.S. Treasury rate with a like term to the remaining term of the loan to which a spread reflective of the risk premium associated with the specific loan is added. Fair values for mortgage loans anticipated to be foreclosed and problem mortgage loans are limited to the fair value of the underlying collateral, if lower.

Policy Loans

The fair value of policy loans is calculated by discounting expected cash flows based upon the U.S. Treasury yield curve and historical loan repayment patterns.

Loans to Affiliates

The fair value of loans to affiliates is calculated by matrix or model pricing. The matrix pricing approach to fair value is a discounted cash flow methodology that incorporates market interest rates commensurate with the credit quality and duration of the investment.

FHLB Funding Agreements

The fair values of the Company’s FHLB long term funding agreements’ fair values are determined based on indicative market rates published by FHLB, provided to AB and modeled for each note’s FMV. FHLB Short-term funding agreements’ fair values are reflective of notional/par value plus accrued interest.

FABN Funding Agreements

The fair values of the Company’s FABN funding agreements are determined by Bloomberg’s evaluated pricing service, which uses direct observations or observed comparables.

Policyholder Liabilities - Investment Contracts and Separate Accounts Liabilities

The fair values for deferred annuities and certain annuities, which are included in Policyholders’ account balances and liabilities for investment contracts with fund investments in Separate Accounts are estimated using projected cash flows discounted at rates reflecting current market rates. Significant unobservable inputs reflected in the cash flows include lapse rates and withdrawal rates. Incremental adjustments may be made to the fair value to reflect non-performance risk. Certain other products such as the Company’s association plans contracts, supplementary contracts not involving life contingencies, Access Accounts and Escrow Shield Plus product reserves are held at book value.

Financial Instruments Exempt from Fair Value Disclosure or Otherwise Not Required to be Disclosed

Exempt from Fair Value Disclosure Requirements

Certain financial instruments are exempt from the requirements for fair value disclosure, such as insurance liabilities other than financial guarantees and investment contracts, limited partnerships accounted for under the equity method and pension and other postretirement obligations.

Otherwise Not Required to be Included in the Table Above

The Company’s investment in COLI policies are recorded at their cash surrender value and are therefore not required to be included in the table above.

8) LIABILITIES FOR FUTURE POLICYHOLDER BENEFITS

The following table summarizes balances and changes in the liability for future policy benefits for nonparticipating traditional and limited pay contracts for the three months ended March 31, 2023 and 2022.

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	Three Months Ended March 31, 2023										Three Months Ended March 31, 2022
	Term		Payout - Non-Legacy		Payout-Legacy		Group Pension		Health		Term		Payout-Non-Legacy		Payout-Legacy		Group Pension		Health
	(in millions)

Balance, beginning of the period	$	2,090	$	—	$	—	$	—	$	(6)	$	2,472	$	—	$	—	$	—	$	22

Beginning balance at original discount rate	2,068		—		—		—		(6)		1,853		—		—		—		19
Effect of changes in cash flow assumptions	8		—		—		—		—		—		—		—		—		—
Effect of actual variances from expected experience	4		—		—		—		(6)		55		—		—		—		(18)
Adjusted beginning of period balance	2,080		—		—		—		(12)		1,908		—		—		—		1
Issuances	15		—		—		—		—		22		—		—		—		—
Interest accrual	25		—		—		—		—		24		—		—		—		—
Net premiums collected	(51)		—		—		—		1		(49)		—		—		—		—

Ending Balance at original discount rate	2,069		—		—		—		(11)		1,905		—		—		—		1
Effect of changes in discount rate assumptions	81		—		—		—		—		385		—		—		—		1
Balance, end of the period	$	2,150	$	—	$	—	$	—	$	(11)	$	2,290	$	—	$	—	$	—	$	2

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	March 31, 2023										March 31, 2022
	Term		Payout - Non-Legacy		Payout - Legacy		Group Pension		Health		Term		Payout - Non-Legacy		Payout - Legacy		Group Pension		Health
	( in millions)
Present Value of Expected Future Policy Benefits
Balance, beginning of the period	$	3,449	$	828	$	2,689	$	523	$	1,554	$	4,274	$	1,114	$	2,547	$	683	$	2,092
Beginning balance of original discount rate	3,376		845		3,024		583		1,795		3,225		883		2,400		632		1,915
Effect of changes in cash flow assumptions	9		—		—		—		—		—		—		—		—		—
Effect of actual variances from expected experience	5		—		1		(1)		(7)		60		(1)		(4)		—		(20)
Adjusted beginning of period balance	3,390		845		3,025		582		1,788		3,285		882		2,396		632		1,895
Issuances	16		14		222		—		—		23		9		152		—		—
Interest accrual	42		10		21		5		15		41		10		16		6		15
Benefits payments	(95)		(23)		(65)		(17)		(33)		(135)		(23)		(47)		(18)		(41)

Ending balance at original discount rate	3,353		846		3,203		570		1,770		3,214		878		2,517		620		1,869
Effect of changes in discount rate assumptions	162		6		(257)		(48)		(198)		646		126		(58)		1		(5)
Balance, end of the period	$	3,515	$	852	$	2,946	$	522	$	1,572	$	3,860	$	1,004	$	2,459	$	621	$	1,864


Net liability for future policy benefits	$	1,365	$	853	$	2,945	$	522	$	1,584	$	1,570	$	1,004	$	2,459	$	621	$	1,862
Less: Reinsurance recoverable	(206)		—		(589)		—		(1,258)		(244)		—		(203)		—		(1,479)
Net liability for future policy benefits, after reinsurance recoverable	$	1,159	$	853	$	2,356	$	522	$	326	$	1,326	$	1,004	$	2,256	$	621	$	383

Weighted-average duration of liability for future policyholder benefits (years)	7.1		9.4		7.9		7.1		8.7		7.5		9.6		8.4		7.2		8.9

The following table reconciles the net liability for future policy benefits and liability of death benefits to the liability for future policy benefits in the consolidated balance sheet as of March 31, 2023 and December 31, 2022.

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	March 31, 2023		December 31, 2022
	(in millions)
Reconciliation
Term	$	1,365	$	1,359
Payout - Non Legacy	853		828
Payout - Legacy	2,945		2,689
Group Pension - Benefit Reserve & DPL	522		523
Health	1,584		1,560
Universal Life - additional liability for death benefits	1,141		1,119
Subtotal	8,410		8,078
Whole Life Closed Block and Open Block products	5,620		5,687
Other (1)	597		608
Future policyholder benefits total	14,627		14,373
Other policyholder funds and dividends payable	1,406		1,562
Total	$	16,033	$	15,935

______________

(1)Primarily consists of Future policy benefits related to Assumed Life and DI, GRP Life Run off, VISL rider and Major Med products.

The following table provides the amount of undiscounted and discounted expected gross premiums and expected future benefits and expenses related to nonparticipating traditional and limited payment contracts as of March 31, 2023 and December 31, 2022:


	March 31, 2023		December 31, 2022
	(in million)
Term
Expected future benefit payments and expenses (undiscounted)	$	5,952	$	6,002
Expected future gross premiums (undiscounted)	7,161		7,245
Expected future benefit payments and expenses (discounted)	3,516		3,449
Expected future gross premiums (discounted)	3,961		3,883

Payout-Legacy
Expected future benefit payments and expenses (undiscounted)	4,227		3,947
Expected future gross premiums (undiscounted)	—		—
Expected future benefit payments and expenses (discounted)	2,861		2,607
Expected future gross premiums (discounted)	—		—

Payout-Non-Legacy
Expected future benefit payments and expenses (undiscounted)	1,456		1,460
Expected future gross premiums (undiscounted)	—		—
Expected future benefit payments and expenses (discounted)	825		801
Expected future gross premiums (discounted)	—		—

Group Pension
Expected future benefit payments and expenses (undiscounted)	713		730
Expected future gross premiums (undiscounted)	—		—
Expected future benefit payments and expenses (discounted)	550		563
Expected future gross premiums (discounted)	—		—

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	March 31, 2023		December 31, 2022
	(in million)
Health
Expected future benefit payments and expenses (undiscounted)	2,469		2,510
Expected future gross premiums (undiscounted)	94		99
Expected future benefit payments and expenses (discounted)	1,553		1,533
Expected future gross premiums (discounted)	$	75	$	78

The tables below summarizes the revenue and interest related to nonparticipating traditional and limited payment contracts for the three months ended March 31, 2023 and 2022:


	Three Months Ended March 31,
	2023		2022		2023		2022
	Gross Premium				Interest Accretion
	(in millions)
Revenue and Interest Accretion
Term	$	60	$	62	$	17	$	18
Payout - Legacy	27		21		21		16
Payout - Non-Legacy	15		9		10		10
Group Pension	—		—		5		5
Health	2		2		15		15
Total	$	104	$	94	$	68	$	64

The following table provides the weighted average interest rates for the liability for future policy benefits as of March 31, 2023 and December 31, 2022:


	March 31, 2023		December 31, 2022

Weighted Average Interest Rate
Term Life
Interest accretion rate	5.6	%	5.7	%
Current discount rate	4.7	%	5.1	%
Payout Legacy
Interest accretion rate	3.6	%	3.4	%
Current discount rate	4.8	%	5.0	%
Payout - Non-Legacy
Interest accretion rate	4.9	%	4.9	%
Current discount rate	4.9	%	5.2	%
Group Pension
Interest accretion rate	3.4	%	3.4	%
Current discount rate	4.7	%	5.1	%
Health
Interest accretion rate	3.3	%	3.3	%
Current discount rate	4.9	%	5.2	%

The following table provides the balance, changes in and the weighted average durations of the additional insurance liabilities for the three months ended March 31, 2023 and 2022.

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	Three Month Ended March 31,
	2023		2022
	(in millions)
	Universal Life		Universal Life
Balance, beginning of the period	$	1,120	$	1,082
Beginning balance before AOCI adjustments	1,135		1,076
Effect of changes in interest rate and cash flow assumptions and model changes	—		5
Effect of actual variances from expected	6		5
Adjusted beginning of the period balance	1,141		1,086
Interest accrual	13		12
Net assessments collected	18		21
Benefit payments	(18)		(29)

Ending balance before shadow reserve adjustments	1,154		1,090
Effect of reserve adjustment recorded in AOCI	(12)		(1)
Balance, end of the period	$	1,142	$	1,089

Net liability for additional liability	$	1,142	$	1,089
Less: Reinsurance recoverable	(573)		(552)
Net liability for additional liability, after reinsurance recoverable	$	569	$	537

Weighted-average duration of additional liability - death benefit (years)	21.6		22.9

______________

(1) Universal Life Additional Liability SOP ending net liability not inclusive of $43 million of LTC and Shadow SOP as of December 31, 2022.

The following tables provides the revenue, interest and weighted average interest rates, related to the additional insurance liabilities for the three months ended and as of March 31, 2023 and 2022.


	Three Months Ended March 31,
	2023		2022		2023		2022
	Assessments				Interest Accretion
	(in millions)
Revenue and Interest Accretion
Universal Life	$	172	$	180	$	13	$	12
Total	$	172	$	180	$	13	$	12


	March 31,
	2023		2022

Weighted Average Interest Rate
Universal Life	4.5	%	4.5	%
Interest accretion rate	4.5	%	4.5	%

9) MARKET RISK BENEFITS

The following table presents the balances and changes to the balances for the market risk benefits for the GMxB benefits on deferred variable annuities for the three months ended and as of March 31, 2023 and 2022.

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	March 31, 2023								March 31, 2022
	GMxB Core		GMxB Legacy		Purchased MRB (3)		Net Legacy		GMxB Core		GMxB Legacy		Purchased MRB (3)		Net Legacy
			( in millions)
Balance, beginning of the period (“BOP”)	$	539	$	14,699	$	(10,493)	$	4,206	$	1,061	$	20,235	$	(14,293)	$	5,942
Balance BOP before changes in the instrument specific credit risk	538		15,314		(10,439)		4,875		666		19,718		(14,287)		5,431
Model changes and effect of changes in cash flow assumptions	—		—		—		—		—		(88)		29		(59)
Actual market movement effect	(206)		(744)		393		(351)		324		1,098		(414)		684
Interest accrual	18		197		(155)		42		5		104		(62)		42
Attributed fees accrued (1)	94		210		(83)		126		92		219		(86)		133
Benefit payments	(12)		(342)		185		(157)		(5)		(251)		136		(116)
Actual policyholder behavior different from expected behavior	5		21		(17)		4		—		33		(14)		18
Changes in future economic assumptions	123		943		(532)		412		(535)		(2,934)		2,083		(851)
Issuances	—		—		—		—		(3)		—		—		—
Balance EOP before changes in the instrument-specific credit risk	560		15,599		(10,648)		4,952		544		17,899		(12,616)		5,283
Changes in the instrument-specific credit risk (2)	(227)		(1,517)		(98)		(1,616)		(37)		(970)		(64)		(1,035)
Balance, end of the period (“EOP”)	$	333	$	14,082	$	(10,746)	$	3,336	$	507	$	16,929	$	(12,680)	$	4,248

Weighted-average age of policyholders (years)	63.8		72.8		67.7		N/A		62.8		72.2		67.1		N/A
Net amount at risk	$	3,278	$	21,472	$	10,036	N/A		$	1,785	$	17,987	$	7,655	N/A

_______________

(1) Attributed fees accrued represents the portion of the fees needed to fund future GMxB claims.

(2) Changes are recorded in OCI.

(3) Purchased MRB is the impact of non-affiliated reinsurance.

The following table reconciles market risk benefits by the amounts in an asset position and amounts in a liability position to the market risk amounts in the consolidated balance sheet as of March 31, 2023 and December 31, 2022.


	March 31, 2023										December 31, 2022
	Direct Asset		Direct Liability		Net Direct MRB		Purchased MRB		Total		Direct Asset		Direct Liability		Net Direct MRB		Purchased MRB		Total
	(in millions)

GMxB Legacy	$	(74)	$	14,156	$	14,082	$	(10,746)	$	3,336	$	(51)	$	14,749	$	14,698	$	(10,493)	$	4,205
GMxB Core	(480)		813		333		—		333		(375)		914		539		—		539
Other (1)	(58)		78		20		3		23		(52)		88		36		3		39
Total	$	(612)	$	15,047	$	14,435	$	(10,743)	$	3,692	$	(478)	$	15,751	$	15,273	$	(10,490)	$	4,783

______________

(1) Other primarily includes Individual EQUI-VEST MRB.

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

10) POLICYHOLDER ACCOUNT BALANCES

The following table summarizes the balances and changes in policyholders’ account balances three months ended and as of March 31, 2023 and 2022:


	Universal Life			Variable Universal Life			GMxB Legacy			GMxB Core			SCS (1)			EQUI-VEST Individual			EQUI-VEST Group			Momentum
March 31, 2023	( in millions)
Balance, beginning of the period	$	5,341		$	4,253		$	688		$	42		$	35,460		$	2,652		$	12,046		$	703
Issuances	—			—			—			—			—			—			—			—
Premiums received	183			33			20			16			—			11			148			19
Policy charges	(194)			(55)			19			(3)			(1)			—			(1)			—
Surrenders and withdrawals	(18)			(1)			(25)			(8)			(606)			(94)			(406)			(30)
Benefit payments	(76)			(38)			(24)			(1)			(59)			(20)			(17)			(2)
Net transfers from (to) separate account	—			(57)			—			(22)			950			3			69			(9)
Interest credited (2)	55			46			7			1			1,597			19			102			3
Other	—			—			—			—			—			3			11			—
Balance, end of the period	$	5,291		$	4,181		$	685		$	25		$	37,341		$	2,574		$	11,952		$	684

Weighted-average crediting rate	3.64		%	3.86		%	1.78		%	1.05		%	1.12		%	3.09		%	2.99		%	2.03		%
Net amount at risk (3)	$	37,031		$	83,830		$	21,472		$	3,278		$	42		$	128		$	58		$	—
Cash surrender value	$	3,475		$	2,758		$	957		$	252		$	34,078		$	2,567		$	11,871		$	684

______________

(1)SCS sales are recorded as a Separate Account liability until they are swept into the General Account. This sweep is recorded as Net Transfers from (to) separate account.

(2)SCS and EQUI-VEST Group reflected includes amounts related to the change in embedded derivative.

(3)For life insurance products the net amount at risk is death benefit less account value for the policyholder. For variable annuity products the net amount risk is the maximum GMxB NAR for the policyholder.


	Universal Life		Variable Universal Life		GMxB Legacy		GMxB Core		SCS (1)		EQUI-VEST Individual		EQUI-VEST Group		Momentum
March 31, 2022	( in millions)
Balance, beginning of the period	$	5,462	$	4,193	$	746	$	99	$	33,443	$	2,784	$	11,952	$	705
Issuances	—		—		—		—		—		—		—		—
Premiums received	191		43		16		36		—		15		149		23
Policy charges	(200)		(53)		13		(9)		—		—		(1)		—
Surrenders and withdrawals	(20)		—		(16)		(9)		(714)		(45)		(195)		(36)
Benefit payments	(53)		(2)		(26)		(1)		(59)		(15)		(19)		(1)
Net transfers from (to) separate account	—		3		3		(38)		1,717		10		109		23
Interest credited (2)	56		38		7		2		(272)		20		66		3
Other	—		—		—		—		—		—		—		—
Balance, end of the period	$	5,436	$	4,222	$	743	$	80	$	34,115	$	2,769	$	12,061	$	717

Weighted-average crediting rate	3.62%		3.88%		1.81%		1.05%		1.14%		2.86%		2.36%		2.04%
Net amount at risk (3)	$	39,254	$	84,437	$	17,987	$	1,785	$	10	$	104	$	19	$	—
Cash surrender value	$	3,521	$	2,892	$	1,031	$	291	$	31,608	$	2,761	$	11,982	$	716

______________

(1)SCS sales are recorded as a Separate Account liability until they are swept into the General Account. This sweep is recorded as Net Transfers from (to) separate account.

(2)SCS and EQUI-VEST Group reflected includes amounts related to the change in embedded derivative.

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

The following table reconciles the policyholders account balances to the policyholders’ account balance liability in the consolidated balance sheet as of March 31, 2023 and December 31, 2022.


	March 31, 2023		December 31, 2022
	(in millions)
Policyholders’ account balance reconciliation
UL	$	5,291	$	5,341
VUL	4,181		4,253
GMxB Legacy	685		688
GMxB Core	25		42
EQUI-VEST Individual	2,574		2,652
SCS	37,341		35,460
EQUI-VEST Group	11,952		12,046
Momentum	684		703
Other (1)	2,966		2,920
Balance (exclusive of Funding Agreements)	65,699		64,105
Funding Agreements	15,798		15,637
Balance, end of the period	$	81,497	$	79,742

_______________

(1) Primarily reflects products, IR Payout, IR Other, Investment Edge, Association, Indexed Universal Life, Group Pension and Closed Block.

The following table presents the account values by range of guaranteed minimum crediting rates and the related range of the difference in basis points, between rates being credited policyholders and the respective guaranteed minimums as of March 31, 2023 and December 31, 2022.


March 31, 2023
Product (1)	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point - 50 Basis Points Above		51 Basis Points - 150 Basis Points Above		Greater Than 150 Basis Points Above		Total
( in millions)
Universal Life	0.00% - 1.50%	$	—	$	—	$	4	$	1	$	5
	1.51% - 2.50%	155		127		640		112		1,034
	Greater than 2.50%	3,565		650		—		—		4,215
	Total	$	3,720	$	777	$	644	$	113	$	5,254

Variable Universal Life	0.00% - 1.50%	$	8	$	15	$	6	$	2	$	31
	1.51% - 2.50%	325		129		—		—		454
	Greater than 2.50%	3,357		—		—		—		3,357
	Total	$	3,690	$	144	$	6	$	2	$	3,842

GMxB Legacy	0.00% - 1.50%	$	387	$	—	$	—	$	—	$	387
	1.51% - 2.50%	539		—		—		—		539
	Greater than 2.50%	33		—		—		—		33
	Total	$	959	$	—	$	—	$	—	$	959

Table of Contents

EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


March 31, 2023
Product (1)	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point - 50 Basis Points Above		51 Basis Points - 150 Basis Points Above		Greater Than 150 Basis Points Above		Total
( in millions)
GMxB Core	0.00% - 1.50%	$	244	$	—	$	—	$	—	$	244
	1.51% - 2.50%	14		—		—		—		14
	Greater than 2.50%	—		—		—		—		—
	Total	$	258	$	—	$	—	$	—	$	258

EQUI-VEST Individual	0.00% - 1.50%	$	35	$	—	$	55	$	239	$	329
	1.51% - 2.50%	—		—		46		—		46
	Greater than 2.50%	2,121		20		59		—		2,200
	Total	$	2,156	$	20	$	161	$	239	$	2,575

EQUI-VEST Group	0.00% - 1.50%	$	58	$	57	$	362	$	3,176	$	3,653
	1.51% - 2.50%	11		2		897		—		910
	Greater than 2.50%	6,799		342		—		—		7,141
	Total	$	6,868	$	401	$	1,259	$	3,176	$	11,704

SCS	0.00% - 1.50%	$	29,799	$	—	$	—	$	—	$	29,799
	1.51% - 2.50%	5,821		—		—		—		5,821
	Greater than 2.50%	—		—		—		—		—
	Total	$	35,620	$	—	$	—	$	—	$	35,620

Momentum	0.00% - 1.50%	$	13	$	291	$	119	$	7	$	430
	1.51% - 2.50%	174		1		—		—		175
	Greater than 2.50%	73		—		5		—		78
	Total	$	260	$	292	$	124	$	7	$	683


December 31, 2022
Product	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point - 50 Basis Points Above		51 Basis Points - 150 Basis Points Above		Greater Than 150 Basis Points Above		Total
( in millions)

Universal Life	0.00% - 1.50%	$	—	$	—	$	5	$	1	$	6
	1.51% - 2.50%	181		197		605		47		1,030
	Greater than 2.50%	3,615		657		—		—		4,272
	Total	$	3,796	$	854	$	610	$	48	$	5,308

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


December 31, 2022
Product	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point - 50 Basis Points Above		51 Basis Points - 150 Basis Points Above		Greater Than 150 Basis Points Above		Total
( in millions)
Variable Universal Life	0.00% - 1.50%	$	12	$	9	$	5	$	1	$	27
	1.51% - 2.50%	411		42		—		—		453
	Greater than 2.50%	3,441		—		—		—		3,441
	Total	$	3,864	$	51	$	5	$	1	$	3,921

GMxB Legacy	0.00% - 1.50%	$	386	$	—	$	—	$	—	$	386
	1.51% - 2.50%	560		—		—		—		560
	Greater than 2.50%	35		—		—		—		35
	Total	$	981	$	—	$	—	$	—	$	981

GMxB Core	0.00% - 1.50%	$	257	$	—	$	—	$	—	$	257
	1.51% - 2.50%	14		—		—		—		14
	Greater than 2.50%	—		—		—		—		—
	Total	$	271	$	—	$	—	$	—	$	271

EQUI-VEST Individual	0.00% - 1.50%	$	345	$	—	$	—	$	—	$	345
	1.51% - 2.50%	46		—		—		—		46
	Greater than 2.50%	2,199		—		62		—		2,261
	Total	$	2,590	$	—	$	62	$	—	$	2,652

EQUI-VEST Group	0.00% - 1.50%	$	109	$	5	$	366	$	3,112	$	3,592
	1.51% - 2.50%	11		2		889		—		902
	Greater than 2.50%	6,949		21		330		—		7,300
	Total	$	7,069	$	28	$	1,585	$	3,112	$	11,794

SCS	0.00% - 1.50%	$	27,846	$	—	$	—	$	—	$	27,846
	1.51% - 2.50%	5,527		—		—		—		5,527
	Greater than 2.50%	—		—		—		—		—
	Total	$	33,373	$	—	$	—	$	—	$	33,373

Momentum	0.00% - 1.50%	$	15	$	301	$	122	$	7	$	445
	1.51% - 2.50%	178		1		—		—		179
	Greater than 2.50%	73		—		5		—		78
	Total	$	266	$	302	$	127	$	7	$	702

Separate Account - Summary

The following table presents the balances of and changes in separate account liabilities three months ended and as of March 31, 2023 and 2022.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued



	VUL		GMxB Legacy		GMxB Core		EQUI-VEST Individual		Investment Edge		EQUI-VEST Group		Momentum
March 31, 2023	(in millions)
Balance, beginning of the period	$	11,534	$	32,616	$	27,017	$	4,162	$	3,772	$	22,393	$	3,884
Premiums and deposits	191		65		117		26		115		531		178
Policy charges	(106)		(178)		(113)		(1)		—		(4)		(5)
Surrenders and withdrawals	(107)		(660)		(554)		(100)		(95)		(359)		(157)
Benefit payments	(22)		(192)		(53)		(14)		(12)		(15)		(3)
Investment performance (1)	745		1,808		1,163		268		174		1,438		235
Net transfers from (to) general account	57		—		22		(3)		(62)		(69)		9
Other charges (2)	—		—		—		4		—		25		—
Balance, end of the period	$	12,292	$	33,459	$	27,599	$	4,342	$	3,892	$	23,940	$	4,141

Cash surrender value	$	12,287	$	33,181	$	26,806	$	4,310	$	3,801	$	23,702	$	4,136

_______________

(1)Investment performance is reflected net of M&E fees.

(2)For the three months ended March 31, 2023, EQUI-VEST Individual and EQUI-VEST Group amounts reflect a total special payment applied to the accounts of active clients as part of a previously disclosed settlement agreement between Equitable Financial Life Insurance Company and the Securities & Exchange Commission.



	VUL		GMxB Legacy		GMxB Core		EQUI-VEST Individual		Investment Edge		EQUI-VEST Group		Momentum
March 31, 2022	(in millions)
Balance, beginning of the period	$	14,573	$	44,912	$	34,973	$	5,584	$	4,287	$	27,509	$	4,975
Premiums and deposits	191		55		333		42		241		523		185
Policy charges	(105)		(183)		(114)		—		—		(4)		(5)
Surrenders and withdrawals	(106)		(771)		(688)		(88)		(68)		(356)		(210)
Benefit payments	(53)		(186)		(70)		(16)		(11)		(20)		(1)
Investment performance (1)	(921)		(2,933)		(2,178)		(380)		(257)		(1,874)		(326)
Net transfers from (to) general account	(3)		(3)		38		(10)		(39)		(109)		(23)

Balance, end of the period	$	13,576	$	40,891	$	32,294	$	5,132	$	4,153	$	25,669	$	4,595

Cash surrender value	$	13,570	$	40,601	$	31,378	$	5,096	$	4,061	$	25,426	$	4,588

______________

(1) Investment performance is reflected net of M&E fees.

The following table reconciles the separate account liabilities to the separate account liability balance in the consolidated balance sheet as of March 31, 2023 and December 31, 2022.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	March 31, 2023		December 31, 2022
	(in millions)
Separate Account Reconciliation
VUL	$	12,292	$	11,534
GMxB Legacy	33,459		32,616
GMxB Core	27,599		27,017
EQUI-VEST Individual	4,342		4,162
Investment Edge	3,892		3,772
EQUI-VEST Group	23,940		22,393
Momentum	4,141		3,884
Other (1)	6,220		6,101
Total	$	115,885	$	111,479

_____________

(1)Primarily reflects Corp and Other products and Employer Sponsored products including Association and Other.

The following table presents the aggregate fair value of separate account assets by major asset category as of March 31, 2023 and December 31, 2022:


	March 31, 2023
	Life Insurance & Employee Benefits Products		Individual Variable Annuity Products		Employer - Sponsored Products		Other		Total
	(in millions)
Asset Type
Debt securities	$	63	$	1	$	16	$	10	$	90
Common Stock	51		33		457		1,712		2,253
Mutual Funds	12,132		69,990		29,428		743		112,293
Bonds and Notes	114		3		1		1,131		1,249
Total	$	12,361	$	70,027	$	29,902	$	3,596	$	115,885


	December 31, 2022
	Life Insurance & Employee Benefits Products		Individual Variable Annuity Products		Employer - Sponsored Products		Other		Total
	(in millions)
Asset Type
Debt securities	$	58	$	1	$	17	$	8	$	84
Common Stock	41		32		430		1,686		2,189
Mutual Funds	11,402		68,220		27,639		760		108,021
Bonds and Notes	119		3		1		1,062		1,185
Total	$	11,620	$	68,256	$	28,087	$	3,516	$	111,479

11) INCOME TAXES

Income tax expense for the three months ended March 31, 2023 and 2022 was computed using an estimated annual effective tax rate (“ETR”), with discrete items recognized in the period in which they occur. The estimated ETR is revised, as necessary, at the end of successive interim reporting periods.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

During the fourth quarter of 2022, the Company established a valuation allowance of $1.5 billion against its deferred tax asset related to unrealized capital losses in the available for sale securities portfolio. For the three months ended March 31, 2023, the Company recorded a decrease to the valuation allowance of $316 million due to a decrease in the portfolio’s unrealized capital loss. This adjustment was allocated to other comprehensive income.

As of each reporting date, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. During the three months ended March 31, 2023, the Company has taken steps to increase its available future liquidity by increasing borrowing capacity and amending certain counterparty agreements. While management has several actions that are pending, the Company now has the ability and intent to hold the underlying securities in its available for sale portfolio to recovery to the extent that half of the deferred tax asset would be realized. Based on all available evidence, as of March 31, 2023, the Company concluded that half of the deferred tax asset related to unrealized tax capital losses is more-likely-than-not to be realized and a full valuation allowance is not necessary. A valuation allowance of $586 million remains against the portion of the deferred tax asset that is still not more-likely-than-not to be realized. The partial release of the valuation allowance of $586 million was recorded in net income.

The Company uses the aggregate portfolio approach related to the stranded or disproportionate income tax effects in accumulated other comprehensive income related to available for sale securities. Under this approach, the disproportionate tax effect remains intact as long as the investment portfolio remains.

12) RELATED PARTY TRANSACTIONS

The Company did not enter into any new significant transactions with related parties during the first quarter 2023.

13) EQUITY

AOCI represents cumulative gains (losses) on items that are not reflected in net income (loss). The balances as of March 31, 2023 and December 31, 2022 follow:


	March 31,		December 31,
	2023		2022
	(in millions)
Unrealized gains (losses) on investments	$	(7,583)	$	(8,873)
Market risk benefits - instrument-specific credit risk component	1,847		665
Liability for future policy benefits - current discount rate component	218		357
Defined benefit pension plans	(4)		(4)
Accumulated other comprehensive income (loss) attributable to Equitable Financial	$	(5,522)	$	(7,855)

The components of OCI, net of taxes for the three months ended March 31, 2023 and 2022, is as follows:

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued


	Three Months Ended March 31,
		2023		2022
		(in millions)
Change in net unrealized gains (losses) on investments:
Net unrealized gains (losses) arising during the period		$	1,452	$	(4,795)
(Gains) losses reclassified into net income (loss) during the period		55		261
Net unrealized gains (losses) on investments (1)		1,507		(4,534)
Adjustments for policyholders’ liabilities, DAC, insurance liability loss recognition and other		2		801
Change in unrealized gains (losses), net of adjustments (net of deferred income tax expense (benefit) of $317 and $(992))		1,509		(3,733)
Change in LFPB discount rate and MRB credit risk, net of tax
Liability for future policy benefits - changes in current discount rate (net of deferred income tax expense (benefit) of $248 and $402)		933		1,512
Market risk benefits - changes in instrument-specific credit risk (net of deferred income tax expense (benefit) of $(29) and $68)		(109)		257

Change in Accumulated other comprehensive income (loss) attributable to Equitable Financial		$	2,333	$	(1,964)

____________

(1)See “Reclassification adjustment” in Note 3 of the Notes to these Consolidated Financial Statements. Reclassification amounts presented net of income tax expense (benefit) of $(15) million and $(70) million for the three months ended March 31, 2023 and 2022, respectively.

Investment gains and losses reclassified from AOCI to net income (loss) primarily consist of realized gains (losses) on sales and credit losses of AFS securities and are included in total investment gains (losses), net on the consolidated statements of income (loss). Amounts reclassified from AOCI to net income (loss) as related to defined benefit plans primarily consist of amortization of net (gains) losses and net prior service cost (credit) recognized as a component of net periodic cost and reported in compensation and benefits in the consolidated statements of income (loss). Amounts presented in the table above are net of tax.

14) REDEEMABLE NONCONTROLLING INTEREST

The changes in the components of redeemable noncontrolling interests are presented in the table that follows:


	Three Months Ended March 31,
		2023		2022
		(in millions)
Balance, beginning of the period		$	21	$	28
Net earnings (loss) attributable to redeemable noncontrolling interests		—		(1)
Purchase/change of redeemable noncontrolling interests		(2)		2
Balance, end of the period		$	19	$	29

15) COMMITMENTS AND CONTINGENT LIABILITIES

Litigation and Regulatory Matters

Litigation, regulatory and other loss contingencies arise in the ordinary course of the Company’s activities as a diversified financial services firm. The Company is a defendant in a number of litigation matters arising from the conduct of its business. In some of these matters, claimants seek to recover very large or indeterminate amounts, including compensatory, punitive, treble and exemplary damages. Modern pleading practice permits considerable variation in the assertion of monetary damages and other relief. Claimants are not always required to specify the monetary damages they seek, or they may be required only to state an amount sufficient to meet a court’s jurisdictional requirements. Moreover, some jurisdictions allow claimants to allege monetary damages that far exceed any reasonably possible verdict. The variability in pleading requirements and past experience demonstrates that the monetary and other relief that may be requested in a lawsuit or claim often bears little relevance to the merits or

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

potential value of a claim. Litigation against the Company includes a variety of claims including, among other things, insurers’ sales practices, alleged agent misconduct, alleged failure to properly supervise agents, contract administration, product design, features and accompanying disclosure, cost of insurance increases, payments of death benefits and the reporting and escheatment of unclaimed property, alleged breach of fiduciary duties, alleged mismanagement of client funds and other matters.

The outcome of a litigation or regulatory matter is difficult to predict, and the amount or range of potential losses associated with these or other loss contingencies requires significant management judgment. It is not possible to predict the ultimate outcome or to provide reasonably possible losses or ranges of losses for all pending regulatory matters, litigation and other loss contingencies. While it is possible that an adverse outcome in certain cases could have a material adverse effect upon the Company’s financial position, based on information currently known, management believes that neither the outcome of pending litigation and regulatory matters, nor potential liabilities associated with other loss contingencies, are likely to have such an effect. However, given the large and indeterminate amounts sought in certain litigation and the inherent unpredictability of all such matters, it is possible that an adverse outcome in certain of the Company’s litigation or regulatory matters, or liabilities arising from other loss contingencies, could, from time to time, have a material adverse effect upon the Company’s results of operations or cash flows in a particular quarterly or annual period.

For some matters, the Company is able to estimate a range of loss. For such matters in which a loss is probable, an accrual has been made. For matters where the Company believes a loss is reasonably possible, but not probable, no accrual is required. For matters for which an accrual has been made, but there remains a reasonably possible range of loss in excess of the amounts accrued or for matters where no accrual is required, the Company develops an estimate of the unaccrued amounts of the reasonably possible range of losses. As of March 31, 2023, the Company estimates the aggregate range of reasonably possible losses, in excess of any amounts accrued for these matters as of such date, to be up to approximately $250 million.

For other matters, the Company is currently not able to estimate the reasonably possible loss or range of loss. The Company is often unable to estimate the possible loss or range of loss until developments in such matters have provided sufficient information to support an assessment of the range of possible loss, such as quantification of a damage demand from plaintiffs, discovery from plaintiffs and other parties, investigation of factual allegations, rulings by a court on motions or appeals, analysis by experts and the progress of settlement discussions. On a quarterly and annual basis, the Company reviews relevant information with respect to litigation and regulatory contingencies and updates the Company’s accruals, disclosures and reasonably possible losses or ranges of loss based on such reviews.

In February 2016, a lawsuit was filed in the Southern District of New York entitled Brach Family Foundation, Inc. v. AXA Equitable Life Insurance Company. This lawsuit is a putative class action brought on behalf of all owners of UL policies subject to Equitable Financial’s COI rate increase. In early 2016, Equitable Financial raised COI rates for certain UL policies issued between 2004 and 2008, which had both issue ages 70 and above and a current face value amount of $1 million and above. A second putative class action was filed in the District of Arizona in 2017 and consolidated with the Brach matter in federal court in New York. The consolidated amended class action complaint alleges the following claims: breach of contract; misrepresentations in violation of Section 4226 of the New York Insurance Law; violations of New York General Business Law Section 349; and violations of the California Unfair Competition Law, and the California Elder Abuse Statute. Plaintiffs seek: (a) compensatory damages, costs, and, pre- and post-judgment interest; (b) with respect to their claim concerning Section 4226, a penalty in the amount of premiums paid by the plaintiffs and the putative class; and (c) injunctive relief and attorneys’ fees in connection with their statutory claims. In August 2020, the federal district court issued a decision certifying nationwide breach of contract and Section 4226 classes, and a New York State Section 349 class. Owners of a substantial number of policies opted out of the Brach class action. Most opt-out policies are not yet the subject of litigation. Others filed suit previously, including three federal actions that have been coordinated with the Brach action and contain similar allegations along with additional allegations for violations of state consumer protection statutes and common law fraud. In March 2022, the federal district court issued a summary judgment decision, denying in significant part but granting in part Equitable Financial’s motion and denying the motion filed by plaintiffs in the coordinated actions. In July 2022, the federal district court granted Equitable Financial’s motion to reconsider its summary judgment decision in part and granted summary judgment as to a portion of the Section 4226 class. The federal district court also agreed to consider whether it should decertify the Section 4226 class. In January 2023, the federal district court declined to decertify the class and instead modified it to replace certain class members. Beginning October 30, 2023, the federal district court will hold one consolidated trial for the Brach action and the three coordinated actions. Equitable Financial has commenced settlement discussions with the Brach class action plaintiffs and plaintiffs in the coordinated actions. No assurances can be given about the outcome of those settlement discussions. Equitable Financial has settled

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

actual and threatened litigations challenging the COI increase by individual policyowners and one entity that invested in numerous policies purchased in the life settlement market. Two actions are also pending against Equitable Financial in New York state court. In July 2022, the trial court in one of the New York state court actions, Hobish v. AXA Equitable Life Insurance Company, granted in significant part Equitable Financial’s motion for summary judgment and denied plaintiff’s cross motion. That plaintiff filed a notice of appeal and Equitable filed a notice of cross-appeal. Equitable Financial is vigorously defending each of these matters.

As with other financial services companies, Equitable Financial periodically receives informal and formal requests for information from various state and federal governmental agencies and self-regulatory organizations in connection with inquiries and investigations of the products and practices of the Company or the financial services industry. It is the practice of the Company to cooperate fully in these matters.

Obligations under Funding Agreements

Federal Home Loan Bank (“FHLB”)

As a member of the FHLB, Equitable Financial has access to collateralized borrowings. It also may issue funding agreements to the FHLB. Both the collateralized borrowings and funding agreements would require Equitable Financial to pledge qualified mortgage-backed assets and/or government securities as collateral. Equitable Financial issues short-term funding agreements to the FHLB and uses the funds for asset, liability, and cash management purposes. Equitable Financial issues long-term funding agreements to the FHLB and uses the funds for spread lending purposes.

Entering into FHLB membership, borrowings and funding agreements requires the ownership of FHLB stock and the pledge of assets as collateral. Equitable Financial has purchased FHLB stock of $388 million and pledged collateral with a carrying value of $13.0 billion as of March 31, 2023.

Funding agreements are reported in policyholders’ account balances in the consolidated balance sheets. For other instruments used for asset/liability and cash management purposes, see “Offsetting of Financial Assets and Liabilities and Derivative Instruments” included in Note 4 of the Notes to these Consolidated Financial Statements. The table below summarizes the Company’s activity of funding agreements with the FHLB.

Change in FHLB Funding Agreements during the Three Months Ended March 31, 2023


	Outstanding Balance at December 31, 2022		Issued During the Period		Repaid During the Period		Long-term Agreements Maturing Within One Year		Long-term Agreements Maturing Within Five Years		Outstanding Balance at March 31, 2023
	(in millions)
Short-term funding agreements:
Due in one year or less	$	6,130	$	14,066	$	(14,201)	$	—	$	—	$	5,995
Long-term funding agreements:
Due in years two through five	1,679		—		—		—		—		1,679
Due in more than five years	692		—		—		—		—		692
Total long-term funding agreements	2,371		—		—		—		—		2,371
Total funding agreements (1)	$	8,501	$	14,066	$	(14,201)	$	—	$	—	$	8,366

____________

(1)The $3 million and $4 million difference between the funding agreements carrying value shown in fair value table for March 31, 2023 and December 31, 2022, respectively, reflects the remaining amortization of a hedge implemented and closed, which locked in the funding agreements borrowing rates.

Funding Agreement-Backed Notes Program (“FABN”)

Under the FABN program, Equitable Financial may issue funding agreements in U.S. dollar or foreign currencies to a Delaware special purpose statutory trust (the “Trust”) in exchange for the proceeds from issuances of fixed and floating rate medium-term marketable notes issued by the Trust from time to time (the “Trust Notes”). The funding agreements have matching interest, maturity and currency payment terms to the applicable Trust Notes. The Company

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

hedges the foreign currency exposure of foreign currency denominated funding agreements using cross currency swaps as discussed in Note 4 of the Notes to these Consolidated Financial Statements. As of March 31, 2023, the maximum aggregate principal amount of Trust Notes permitted to be outstanding at any one time is $10.0 billion. Funding agreements issued to the Trust, including any foreign currency transaction adjustments, are reported in policyholders’ account balances in the consolidated balance sheets. Foreign currency transaction adjustments to policyholder’s account balances are recognized in net income (loss) as an adjustment to interest credited to policyholders’ account balances and are offset in interest credited to policyholders’ account balances by a release of AOCI from deferred changes in fair value of designated and qualifying cross currency swap cash flow hedges. The table below summarizes Equitable Financial’s issuances of funding agreements under the FABN program.

Change in FABN Funding Agreements during the Three Months Ended March 31, 2023


	Outstanding Balance at December 31, 2022		Issued During the Period		Repaid During the Period		Long-term Agreements Maturing Within One Year		Long-term Agreements Maturing Within Five Years		Foreign Currency Transaction Adjustment		Outstanding Balance at March 31, 2023
	(in millions)
Short-term funding agreements:
Due in one year or less	$	1,500	$	—	$	—	$	—	$	—	$	—	$	1,500
Long-term funding agreements:
Due in years two through five	4,000		300		—		—		750		—		5,050
Due in more than five years	1,585		—		—		—		(750)		7		842
Total long-term funding agreements	5,585		300		—		—		—		7		5,892
Total funding agreements (1)	$	7,085	$	300	$	—	$	—	$	—	$	7	$	7,392

_____________

(1)The $25 million and $66 million difference between the funding agreements notional value shown and carrying value table as of March 31, 2023 and December 31, 2022, respectively, reflects the remaining amortization of the issuance cost of the funding agreements and the foreign currency transaction adjustment.

Guarantees and Other Commitments

The Company provides certain guarantees or commitments to affiliates and others. As of March 31, 2023, these arrangements include commitments by the Company to provide equity financing of $1.3 billion to certain limited partnerships and real estate joint ventures under certain conditions. Management believes the Company will not incur material losses as a result of these commitments.

The Company had $17 million of undrawn letters of credit related to reinsurance as of March 31, 2023. The Company had $764 million of commitments under existing mortgage loan agreements as of March 31, 2023.

The Company is the obligor under certain structured settlement agreements it had entered into with unaffiliated insurance companies and beneficiaries. To satisfy its obligations under these agreements, the Company owns single premium annuities issued by previously wholly-owned life insurance subsidiaries. The Company has directed payment under these annuities to be made directly to the beneficiaries under the structured settlement agreements. A contingent liability exists with respect to these agreements should the previously wholly-owned subsidiaries be unable to meet their obligations. Management believes the need for the Company to satisfy those obligations is remote.

16) INSURANCE STATUTORY FINANCIAL INFORMATION

Prescribed and Permitted Accounting Practices

As of March 31, 2023, the following three prescribed and permitted practices resulted in net income (loss) and capital and surplus that is different from the statutory surplus that would have been reported had NAIC statutory accounting practices been applied.

Equitable Financial was granted a permitted practice by the NYDFS to apply SSAP 108, Derivatives Hedging Variable Annuity Guarantees on a retroactive basis from January 1, 2021 through June 30, 2021, after reflecting the impacts of our reinsurance transaction with Venerable. The permitted practice was amended to also permit Equitable Financial to adopt SSAP 108 prospectively as of July 1, 2021 and to consider the impact of both the interest rate derivatives and the general account assets used to fully hedge the interest rate risk inherent in its variable annuity guarantees when

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

determining the amount of the deferred asset or liability under SSAP 108. Application of the permitted practice partially mitigates the New York Insurance Regulation 213 (“Reg 213”) impact of the Venerable Transaction on Equitable Financial’s statutory capital and surplus and enables Equitable Financial to more effectively neutralize the impact of interest rates on its statutory surplus and to better align with our economic hedging program. The impact of applying this permitted practice relative to SSAP 108 as written was an increase of approximately $63 million in statutory special surplus funds and a decrease of $22 million in statutory net income for the three months ended March 31, 2023, which will be amortized over five years for each of the retrospective and prospective components. The permitted practice also reset Equitable Financial’s unassigned surplus to zero as of June 30, 2021 to reflect the transformative nature of the Venerable Transaction.

The NAIC Accounting Practices and Procedures manual (“NAIC SAP”) has been adopted as a component of prescribed or permitted practices by the State of New York. However, Reg 213 adopted in May of 2019 and as amended in February 2020 and March 2021, differs from the NAIC variable annuity reserve and capital framework. Reg 213 requires Equitable Financial to carry statutory basis reserves for its variable annuity contract obligations equal to the greater of those required under (i) the NAIC standard or (ii) a revised version of the NYDFS requirement in effect prior to the adoption of the first amendment for contracts issued prior to January 1, 2020, and for policies issued after that date a new standard that in current market conditions imposes more conservative reserving requirements for variable annuity contracts than the NAIC standard.

The impact of the application of Reg 213 was a decrease of approximately $2.2 billion in statutory surplus as of March 31, 2023 compared to statutory surplus under the NAIC variable annuity framework. Our hedging program is designed to hedge the economics of our insurance liabilities and largely offsets Reg 213 and NAIC framework reserve movements due to interest rates and equities. The NYDFS allows domestic insurance companies a five year phase-in provision for Reg 213 reserves. As of September 30, 2022, Equitable Financial’s Reg 213 reserves were 100% phased-in. As of March 31, 2023, given the prevailing market conditions and business mix, there are no Reg 213 redundant reserves over the US RBC CTE 98 total asset requirement (“TAR”). Finally, the continued application of Reg 213 resulted in a corresponding decrease of $0.3 billion in statutory net income for the three months ended March 31, 2023, which was largely offset by net income gains on our hedging program during the same period as noted.

During the fourth quarter 2020, Equitable Financial received approval from NYDFS for its proposed amended Plan of Operation for Separate Account No. 68 (“SA 68”) for our Structured Capital Strategies product and Separate Account No. 69 (“SA 69”) for our EQUI-VEST product Structured Investment Option, to change the accounting basis of these two non-insulated Separate Accounts from fair value to book value in accordance with Section 1414 of the Insurance Law to align with how we manage and measure our overall general account asset portfolio. In order to facilitate this change and comply with Section 4240(a)(10), the Company also sought approval to amend the Plans to remove the requirement to comply with Section 4240(a)(5)(iii) and substitute it with a commitment to comply with Section 4240(a)(5)(i). Similarly, the Company updated the reserves section of each Plan to reflect the fact that Regulation 128 would no longer be applicable upon the change in accounting basis. We applied this change effective January 1, 2021. The impact of the application is an increase of approximately $2.0 billion in statutory surplus and a decrease in statutory net income for the three months ended March 31, 2023 of $157 million.

17) REINSURANCE

The Company assumes and cedes reinsurance with other insurance companies. The Company evaluates the financial condition of its reinsurers to minimize its exposure to significant losses from reinsurer insolvencies. Ceded reinsurance does not relieve the originating insurer of liability.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued

The following table summarizes the effect of reinsurance. The impact of the reinsurance transaction described above results in an increase in reinsurance ceded.


	Three Months Ended March 31,
		2023		2022
		(in millions)
Direct premiums		$	205	$	191
Reinsurance assumed		52		50
Reinsurance ceded		(60)		(52)
Premiums		$	197	$	189

Direct charges and fee income		$	697	$	768
Reinsurance ceded		(173)		(177)
Policy charges and fee income		$	524	$	591

Direct policyholders’ benefits		$	708	$	797
Reinsurance assumed		37		55
Reinsurance ceded		(127)		(139)
Policyholders’ benefits		$	618	$	713

Ceded Reinsurance

The Company reinsures most of its new variable life, UL and term life policies on an excess of retention basis. The Company generally retains on a per life basis up to $25 million for single lives and $30 million for joint lives with the excess 100% reinsured. The Company also reinsures risk on certain substandard underwriting risks and in certain other cases.

On October 3, 2022, as part of the Global Atlantic Transaction, Equitable Financial ceded to First Allmerica Financial Life Insurance Company on a combined coinsurance and modified coinsurance basis, a 50% quota share of approximately 360,000 legacy Group EQUI-VEST deferred variable annuity contracts issued by Equitable Financial between 1980 and 2008.

In addition to the above, the Company cedes a portion of its group health, extended term insurance, and paid-up life insurance and substantially all of its individual disability income business through various coinsurance agreements.

Assumed Reinsurance

In addition to the sale of insurance products, the Company currently acts as a professional retrocessionaire by assuming risk from professional reinsurers. The Company assumes accident, life, health, aviation, special risk and space risks by participating in or reinsuring various reinsurance pools and arrangements.

The following table summarizes the ceded reinsurance GMIB reinsurance contracts, third-party recoverables, amount due to reinsurance and assumed reserves.

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EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

Notes to Consolidated Financial Statements, (Unaudited) Continued



	March 31, 2023		December 31, 2022
	(in millions)
Ceded Reinsurance:
Estimated net fair values of purchased market risk benefits	$	10,743	10,490
Third-party reinsurance recoverables related to insurance contracts	7,136		7,131
Top reinsurers:
Venerable Insurance and Annuity Company (A- KBRA (IFRS) rating)	674		543
First Allmerica-GAF	3,933		4,005
Ceded group health reserves	13		14
Amount due to reinsurers	184		282
Top reinsurers:
First Allmerica-GAF	71		147
Assumed Reinsurance:
Reinsurance assumed reserves	$	694	$	701

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Management’s discussion and analysis of financial condition and results of operations is presented pursuant to General Instruction (H)(2)(a) of Form 10-Q. The management’s narrative that follows should be read in conjunction with the consolidated financial statements and the related Notes to Consolidated Financial Statements included elsewhere herein, with the information provided under “Note Regarding Forward-looking Statements and Information” included elsewhere herein and Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) in Part II, Item 7 and “Risk Factors” in Part I, Item 1A included in Equitable Financial’s Annual Report on Form 10-K for the year ended December 31, 2022 (“2022 Form 10-K”). The management’s narrative that follows represents a discussion and analysis of Equitable Financial’s financial condition and results of operations and not the financial condition and results of operations of Equitable Holdings, Inc. (“Holdings”).

Executive Summary

Overview

We are one of America’s leading financial services companies, providing advice and solutions for helping Americans set and meet their retirement goals and protect and transfer their wealth across generations. We operate as a single segment entity based on the manner in which we use financial information to evaluate business performance and to determine the allocation of resources. We benefit from our complementary mix of product offerings. This mix in product offerings provides diversity in our earnings sources, which helps offset fluctuations in market conditions and variability in business results, while offering growth opportunities.

Long - Duration Targeted Improvements (“LDTI”) Adoption

Effective January 1, 2023, the Company adopted ASU 2018-12 and elected a transition date of January 1, 2021, thereby permitting the Company to implement the standard only for the last two fiscal years rather than the customary last three fiscal years.

The Company adopted ASU 2018-12 for liability for future policy benefits, additional insurance liabilities, DAC and balances amortized on a basis consistent with DAC on a modified retrospective basis. ASU 2018-12 was adopted for MRBs on a full retrospective basis. See Note 2of the Notes to the Consolidated Financial Statements for further information on the adoption of LDTI.

Macroeconomic and Industry Trends

Our business and consolidated results of operations are significantly affected by economic conditions and consumer confidence, conditions in the global capital markets and the interest rate environment.

Financial and Economic Environment

A wide variety of factors continue to impact financial and economic conditions. These factors include, among others, concerns over increased volatility in the capital markets, equity market declines, rising interest rates, inflationary pressures fueling concerns of a potential recession, plateauing or decreasing economic growth, high fuel and energy costs, changes in fiscal or monetary policy and geopolitical tensions. Market volatility, particularly during March 2023, was driven by instability in the banking sector following continued interest rate increases by the U.S. Federal Reserve in 2022 and 2023, as a run on some mid-size U.S. banks resulted in regulatory intervention, including the guarantee of all deposits by the FDIC. The ongoing military conflict between the Ukraine and Russia and the sanctions and other measures imposed in response to this conflict also continue to contribute to geopolitical tensions and market volatility.

Stressed conditions, volatility and disruptions in the capital markets, particular markets, or financial asset classes can have an adverse effect on us, in part because we have a large investment portfolio. In addition, our insurance liabilities and derivatives are sensitive to changing market factors, including equity market performance and interest rates which continued to rise during the first quarter 2023. An increase in market volatility could continue to affect our business, including through effects on the yields we earn on invested assets, changes in required reserves and capital and fluctuations in the value of our AUM and AV, from which we derive our fee income. These effects could be exacerbated by uncertainty about future fiscal policy, changes in tax policy, the scope of potential deregulation and levels of global trade.

The potential for increased volatility could pressure sales and reduce demand for our products as consumers consider purchasing alternative products to meet their objectives. In addition, this environment could make it difficult to consistently

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develop products that are attractive to customers. Financial performance can be adversely affected by market volatility and equity market declines as fees driven by AV and AUM fluctuate, hedging costs increase and revenues decline due to reduced sales and increased outflows.

We monitor the behavior of our customers and other factors, including mortality rates, morbidity rates, annuitization rates and lapse and surrender rates, which change in response to changes in capital market conditions, to ensure that our products and solutions remain attractive and profitable. For additional information on our sensitivity to interest rates and capital market prices, see “Risk Factors-Risks Relating to Conditions in the Financial Markets and Economy” and “Quantitative and Qualitative Disclosures About Market Risk” in the 2022 Form 10-K.

Regulatory Developments

We are regulated primarily by the NYDFS, with some policies and products also subject to federal regulation. On an ongoing basis, regulators refine capital requirements and introduce new reserving standards. Regulations recently adopted or currently under review can potentially impact our statutory reserve, capital requirements and profitability of the industry and result in increased regulation and oversight for the industry.

The NAIC is evaluating the appropriate accounting treatment of an insurer’s negative interest maintenance reserve (“IMR”) balance, since a rising interest rate environment may cause an insurer’s IMR balance to become negative as a result of bond sales executed at a capital loss. If this occurs, current statutory accounting guidance requires the non-admittance of negative IMR, which can impact an insurer’s surplus and financial strength reflected in its financial statements and result in lower reported surplus and RBC ratios. The NAIC has exposed new statutory accounting guidance that would permit an insurer with an RBC greater than 300% to admit negative IMR up to 5% of its general account capital and surplus, subject to certain restrictions and reporting obligations. Comments on the proposal are due in June 2023. The NAIC is focused on identifying an interim solution for year-end 023 statutory reporting, although it also intends to develop a long-term solution even if interest rates change. The Company currently has positive IMR but would benefit from the increased flexibility to manage its investment portfolio provided by the NAIC interim solution if adopted.

The NAIC is also evaluating the risks associated with insurers’ investments in certain categories of structured securities, including CLOs. In March 2023, the NAIC adopted an amendment to the Purposes and Procedures Manual to give the NAIC’s Structured Securities Group, housed within the SVO, responsibility for modeling CLO securities and evaluating tranche level losses across al debt and equity tranches under a series of calibrated and weighted collateral stress scenarios in order to assign NAIC designations. Under the amended Purposes and Procedures Manual, which will become effective no earlier than year-end 2024 financial reporting, CLO investments will no longer be broadly exempt from filing with the SVO based on ratings from Credit Rating Providers. The NAIC’s goal is to ensure that the weighted average RBC factor for owning all tranches of a CLO more closely aligns with what would be required for directly owning all of the underlying loan collateral, in order to avoid RBC arbitrage. The NAIC is collaborating with interested parties to develop and refine the process for modeling CLO investments.

The NAIC has also proposed an interim change to their RBC requirement for equity tranches of all securitizations, including CLOs. If adopted, this would increase the capital charge for these equity tranches from 30% to 45%. This proposal remains subject to comment from regulators, insurance companies, and other interested parties and thus may still be revised or delayed. An interim charge will likely have to be approved by June 30 for it to be effective for year-end 2023 statutory filings. The interim charge is intended to remain in effect until the NAIC finalizes and adopts its modeling framework for CLOs which is not expected to be completed until at least year-end 2024.

In March 2023, the Securities and Exchange Commission (SEC) reopened the comment period for the Investment Management Cybersecurity Release proposing new rules under the Investment Advisers Act of 1940 and the Investment Company Act of 1940 that would require registered investment advisers and investment companies to adopt and implement written cybersecurity policies and procedures reasonably designed to: (1) address cybersecurity risk management, (2) disclose information about cybersecurity risks and incidents, (3) report information confidentially to the SEC about certain cybersecurity incidents, and (4) maintain related records.

In addition, in March 2023, the SEC proposed rule amendments that would require brokers and dealers, investment companies, and investment advisers registered with the SEC to adopt written policies and procedures for incident response programs to address unauthorized access to or use of customer information, including procedures for providing timely notification to individuals affected by an incident involving sensitive customer information with details about the incident and information designed to help affected individuals respond appropriately.The proposal also would broaden the scope of information covered by amending requirements for safeguarding customer records and information, and for properly disposing

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of consumer report information, as well as impose requirements to maintain written records documenting compliance with the proposed amended rules. Finally, the proposed amendments would conform annual privacy notice delivery provisions to the terms of an exception provided by a statutory amendment to the Gramm-Leach-Bliley Act.

Finally, in March 2023, the SEC proposed a new rule and form and amendments to existing recordkeeping rules to require broker-dealers, clearing agencies, major security-based swap participants, the Municipal Securities Rulemaking Board, national securities associations, national securities exchanges, security-based swap data repositories, security-based swap dealers, and transfer agents to address cybersecurity risks through: (1) policies and procedures, (2) immediate notification to the SEC of the occurrence of a significant cybersecurity incident, (3) as applicable, reporting detailed information to the SEC about a significant cybersecurity incident, and (4) public disclosures that would improve transparency with respect to cybersecurity risks and significant cybersecurity incidents.

The public comment period for this proposed rule will end in May 2023. We cannot predict what form the final new or amended rules may take, or what affect such developments in the law may have on our business or compliance costs. For additional information on the regulatory developments and risk we face, see “Business—Regulation” and “Risk Factors—Legal and Regulatory Risks” in the 2022 Form 10-K.

Revenues

Our revenues come from three principal sources:

•fee income derived from our products;

•premiums from our traditional life insurance and annuity products; and

•investment income from our General Account investment portfolio.

Our fee income varies directly in relation to the amount of the underlying AV or benefit base of our life insurance and annuity products which are influenced by changes in economic conditions, primarily equity market returns, as well as net flows. Our premium income is driven by the growth in new policies written and the persistency of our in-force policies, both of which are influenced by a combination of factors, including our efforts to attract and retain customers and market conditions that influence demand for our products. Our investment income is driven by the yield on our General Account investment portfolio and is impacted by the prevailing level of interest rates as we reinvest cash associated with maturing investments and net flows to the portfolio.

Benefits and Other Deductions

Our primary expenses are:

•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.

Policyholders’ benefits are driven primarily by mortality, customer withdrawals and benefits which change in response to changes in capital market conditions. In addition, some of our policyholders’ benefits are directly tied to the AV and benefit base of our variable annuity products. Interest credited to policyholders varies in relation to the amount of the underlying AV or benefit base. Sales commissions and compensation paid to intermediaries and advisors vary in relation to premium and fee income generated from these sources, whereas compensation and benefits to our employees are more constant and impacted by market wages and decline with increases in efficiency. Our ability to manage these expenses across various economic cycles and products is critical to the profitability of our company.

Net Income Volatility

We have offered and continue to offer variable annuity products with GMxB features. The future claims exposure on these features is sensitive to movements in the equity markets and interest rates. Accordingly, we have implemented hedging and reinsurance programs designed to mitigate the economic exposure to us from these features due to equity market and interest rate movements. Changes in the values of the derivatives associated with these programs due to equity market and interest rate movements, together with the GMxB MRBs assets and liabilities are recognized in the periods in which they occur. This results in net income volatility as further described below. In addition net income is impacted by changes in our reinsurers credit

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spread, while changes in the Company's credit spread is recorded in other comprehensive income. See “—Significant Factors Impacting Our Results—Impact of Hedging and GMIB Reinsurance on Results.”

In addition to our dynamic hedging strategy, we have static hedge positions designed to mitigate the adverse impact of changing market conditions on our statutory capital. We believe this program will continue to preserve the economic value of our variable annuity contracts and better protect our target variable annuity asset level. However, these static hedge positions increase the size of our derivative positions and may result in higher net income volatility on a period-over-period basis.

An additional source of net income (loss) volatility is the impact of the Company’s annual actuarial assumption review. See “—Significant Factors Impacting Our Results—Effect of Assumption Updates on Operating Results”, for further detail of the impact of assumption updates on net income (loss).

Significant Factors Impacting Our Results

The following significant factors have impacted, and may in the future impact, our financial condition, and results of operations or cash flows.

Impact of Hedging and GMxB Reinsurance on Results

•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.

•GMxB reinsurance contracts. Historically, GMxB reinsurance contracts were used to cede to affiliated and non-affiliated reinsurers a portion of our exposure to variable annuity products that offer a GMxB feature. We account for the reinsurance contracts as MRBs and report them at fair value. In addition, on June 1, 2021, we ceded the block, comprised of non-New York “Accumulator” policies containing fixed rate GMIB and/or GMDB guarantees.

Effect of Assumption Updates on Operating Results

Our actuaries oversee the valuation of the product liabilities and assets and review the underlying inputs and assumptions. We comprehensively review the actuarial assumptions underlying these valuations and update assumptions during the third quarter of each year. Assumptions are based on a combination of Company experience, industry experience, management actions and expert judgment and reflect our best estimate as of the date of the applicable financial statements. Changes in assumptions can result in a significant change to the carrying value of product liabilities and assets and, consequently, the impact could be material to earnings in the period of the change.

Most of the variable annuity products, variable universal life insurance and universal life insurance products we offer maintain policyholder deposits that are reported as liabilities and classified within either Separate Accounts liabilities or policyholder account balances. Our products and riders also impact liabilities for future policyholder benefits and unearned revenues and assets for DAC and DSI. The valuation of these assets and liabilities (other than deposits) is based on differing accounting methods depending on the product, each of which requires numerous assumptions and considerable judgment. The accounting guidance applied in the valuation of these assets and liabilities includes, but is not limited to, the following: (i) traditional life insurance products for which assumptions are locked in at inception; (ii) universal life insurance and variable life insurance secondary guarantees for which benefit liabilities are determined by estimating the expected value of death benefits payable when the account balance is projected to be zero and recognizing those benefits ratably over the accumulation

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period based on total expected assessments; (iii) certain product guarantees for which benefit liabilities are accrued over the life of the contract in proportion to actual and future expected policy assessments; and (iv) certain product guarantees reported as embedded derivatives at fair value.

For further details of our accounting policies and related judgments pertaining to assumption updates, see Note 2 of the Notes to the Consolidated Financial Statements.

Consolidated Results of Operations

Our consolidated results of operations are significantly affected by conditions in the capital markets and the economy because we offer market sensitive products. These products have been a significant driver of our results of operations. Because the future claims exposure on these products is sensitive to movements in the equity markets and interest rates, we have in place various hedging and reinsurance programs that are designed to mitigate the economic risk of movements in the equity markets and interest rates. The volatility in net income attributable to Equitable Financial for the periods presented below results from the mismatch between: (i) the change in carrying value of the reserves for GMDB and certain GMIB features that do not fully and immediately reflect the impact of equity and interest market fluctuations; (ii) the change in fair value of products with the GMIB feature that have a no-lapse guarantee; and (iii) our hedging and reinsurance programs.

The following table summarizes our consolidated statements of income (loss) for the three months ended March 31, 2023 and 2022:

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Consolidated Statement of Income (Loss)


	Three Months Ended March 31,
	2023		2022
	(in millions)
REVENUES
Policy charges and fee income	$	524	$	591
Premiums	197		189
Net derivative gains (losses)	(841)		144
Net investment income (loss)	858		755
Investment gains (losses), net:
Credit losses on AFS debt securities and loans	(64)		10
Other investment gains (losses), net	(14)		(332)
Total investment gains (losses), net	(78)		(322)
Investment management and service fees	165		193
Other income	94		77
Total revenues	919		1,627

BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	618		713
Remeasurement of liability for future policy benefits	13		14
Change in market risk benefits and purchased market risk benefits	24		(401)
Interest credited to policyholders’ account balances	435		288
Compensation and benefits	55		45
Commissions	194		171
Interest expense	3		—
Amortization of deferred policy acquisition costs	122		115
Other operating costs and expenses	175		266
Total benefits and other deductions	1,639		1,211
Income (loss) from continuing operations, before income taxes	(720)		416
Income tax (expense) benefit	701		(67)
Net income (loss)	(19)		349
Less: Net income (loss) attributable to the noncontrolling interest	—		(1)
Net income (loss) attributable to Equitable Financial	$	(19)	$	350

The following discussion compares the results for the three months ended March 31, 2023 to the three months ended March 31, 2022.

Three Months Ended March 31, 2023 Compared to the Three Months Ended March 31, 2022

Net Income (Loss) Attributable to Equitable Financial

Equitable Financial net earnings (loss) decreased $369 million to a Net loss of $19 million for the three months ended March 31, 2023 from Net income of $350 million for the three months ended March 31, 2022. The following notable items were the primary drivers for the change in net income (loss):

Unfavorable items included:

•Net derivative gains decreased by $1.0 billion from a $144 million gain in the first quarter of the prior year mainly driven by equity market appreciation during first quarter 2023 compared to equity market depreciation during first quarter 2022, partially offset by a decrease in interest rates during first quarter 2023 compared to an increase during the first quarter 2022.

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•Change in market risk benefits and purchased market risk benefits increased by $425 million mainly due to a decrease in interest rates during first quarter 2023 compared to an increase during first quarter of 2022, partially offset by equity market depreciation during first quarter 2022.

•Interest credited to policyholders’ account balances increased by $147 million mainly due to increased interest rates and average outstanding amounts of funding agreements and higher interest crediting rate on SCS due to the higher interest rate environment and growth of SCS AV, partially offset by the impact of the Global Atlantic Transaction.

•Fee-type revenue decreased by $70 million mainly due to lower fees primarily driven by lower average AUM and lower average Separate Accounts AV as a result of lower equity markets.

•Commissions increased by $23 million mainly due to increased distribution expenses from Equitable America’s wholesale products offset by reimbursements recorded in Other income.

These were partially offset by the following favorable items:

•Income tax benefit of $701 million for the three months ended March 31, 2023 compared to income tax expense of $67 million for the three months ended March 31, 2022 primarily related to a partial release of the valuation allowance of $586 million and a pre-tax loss for the first quarter 2023 compared to pre-tax income for the first quarter 2022.

•Net investment gains (losses) increased by $244 million mainly due to rebalancing in the General Account portfolio associated with the Global Atlantic Transaction and the duration program during 2022.

•Net investment income increased by $103 million mainly due to higher assets, higher yields and higher income from seed capital investments partially offset by lower alternative investments and lower prepayment income.

•Policyholders’ benefits decreased by $95 million mainly due to higher benefits in the first quarter 2022 from a transaction to repurchase UL policies from one entity that had invested in numerous purchased in the life settlement market during 2022.

•Compensation, benefits and other operating expenses decreased by $81 million mainly due to lower legal accruals, lower compensation expense, and lower COLI expenses due to market conditions partially offset by an increase in our Life Insurance products due to the non-repeat of a litigation reserve release in the three months ended March 31, 2022.

See “—Significant Factors Impacting Our Results—Effect of Assumption Updates on Operating Results” for more information regarding the assumption update.

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Summary of Critical Accounting Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to adopt accounting policies and make estimates and assumptions that affect amounts reported in our consolidated financial statements included elsewhere herein. For a discussion of our significant accounting policies, see Note 2 of the Notes to the Consolidated Financial Statements. The most critical estimates include those used in determining:

•market risk benefits and purchased market risk benefits

•accounting for reinsurance;

•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;

•measurement of income taxes and the valuation of deferred tax assets; and

•liabilities for litigation and regulatory matters.

In applying our accounting policies, we make subjective and complex judgments that frequently require estimates about matters that are inherently uncertain. Many of these policies, estimates and related judgments are common in the insurance and financial services industries while others are specific to our business and operations. Actual results could differ from these estimates.

Market Risk Benefits

Market risk benefits include contract features that provide minimum guarantees to policyholders and include GMIB, GMDB, GMWB, GMAB, and ROP DB benefits. MRBs are measured at estimated fair value with changes reported in the Change in market risk benefits and purchased market risk benefits, except for the portion of the fair value change related to the Company’s own credit risk, which is recognized in OCI.

MRBs are measured at fair value on a seriatim basis using an Ascribed Fee approach based upon policyholder behavior projections and risk neutral economic scenarios adjusted based on the facts and circumstances of the Company’s product features. Market conditions including, but not limited to, changes in interest rates, equity indices, market volatility and variations in actuarial assumptions, including policyholder behavior, mortality and risk margins related to non-capital market inputs, as well as changes in our nonperformance risk adjustment may result in significant fluctuations in the estimated fair value of the MRBs that could materially affect net income.

Risk margins are established to capture the non-capital market risks of the instrument which represent the additional compensation a market participant would require to assume the risks related to the uncertainties in certain actuarial assumptions. The establishment of risk margins requires the use of significant management judgment, including assumptions of the amount needed to cover the guarantees.

We ceded the risk associated with certain of the variable annuity products with GMxB features described in the preceding paragraphs. The value of the MRBs on the ceded risk is determined using a methodology consistent with that described previously for the guarantees directly written by us with the exception of the input for nonperformance risk that reflects the credit of the reinsurer.

Nonperformance Risk Adjustment

The valuation of our MRBs includes an adjustment for the risk that we fail to satisfy our obligations, which we refer to as our nonperformance risk. The nonperformance risk adjustment, which is captured as a spread over the risk-free rate in determining the discount rate to discount the cash flows of the liability, is determined by taking into consideration publicly available information relating to spreads on corporate bonds in the secondary market comparable to Holdings’ financial strength rating.

The table below illustrates the impact that a range of reasonably likely variances in credit spreads would have on our consolidated balance sheet, excluding the effect of income tax, related to the GMxB Core and GMxB Legacy MRBs measured at estimated fair value. Even when credit spreads do not change, the impact of the nonperformance risk adjustment on fair value will change when the cash flows within the fair value measurement change. The table only reflects the impact of changes in credit spreads on our consolidated financial statements included elsewhere herein and not these other potential changes. In

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determining the ranges, we have considered current market conditions, as well as the market level of spreads that can reasonably be anticipated over the near term. The ranges do not reflect extreme market conditions such as those experienced during the 2008–2009 financial crisis as we do not consider those to be reasonably likely events in the near future.

NPR Sensitivity

December 31, 2022


	Increase/(Decrease) In MRB
	(in millions)
Increase in NPR by 50bps	$	(1,282)
Decrease in NPR by 50bps	$	1,365

Sensitivity of MRBs to Changes in Interest Rates

The following table demonstrates the sensitivity of the MRBs to changes in long-term interest rates by quantifying the adjustments that would be required, assuming an increase and decrease in long-term interest rates of 50bps. This information considers only the direct effect of changes in the interest rates on MRB balances, net of reinsurance.

Interest Rate Sensitivity

December 31, 2022


	Increase/(Decrease) In MRB
	(in millions)
Increase in interest rates by 50bps	$	(846)
Decrease in interest rates by 50bps	$	962

Sensitivity of MRBs to Changes in Equity Returns

The following table demonstrates the sensitivity of the MRBs to changes in equity returns.

Equity Returns Sensitivity

December 31, 2022


	Increase/(Decrease) In MRB
	(in millions)
Increase in equity returns by 10%	$	(871)
Decrease in equity returns by 10%	$	971

Sensitivity of MRBs to Changes in GMIB Lapses

Lapse rates are adjusted at the contract level based on a comparison of the value of the embedded GMIB rider and the current policyholder account value, which include other factors such as considering surrender charges. Generally, lapse rates are assumed to be lower in periods when a surrender charge applies. A dynamic lapse function reduces the base lapse rate when the guaranteed amount is greater than the account value as in-the-money contracts are less likely to lapse.

GMIB Lapse floor Sensitivity

December 31, 2022


	Increase/(Decrease) In MRB
	(in millions)
GMIB Lapse floor of 1%	$	(177)

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes to the quantitative and qualitative disclosures about market risk described in the Annual Report on Form 10-K for the year ended December 31, 2022 in "Quantitative and Qualitative Disclosures About Market Risk".

Item 4. Controls and Procedures

Management, with the participation of the Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures, as defined in Rule 13a-15(e) of the Exchange Act. Based on such evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of March 31, 2023, the Company’s disclosure controls and procedures were effective.

During the first quarter 2023, we adopted the new accounting standard ASU 2018-12, Financial Services – Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts. We have modified our existing controls infrastructure, primarily through enhanced automation in our actuarial processes. There are no other changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and Rule 15d-15(f) under the Exchange Act) that occurred during the quarter ended March 31, 2023, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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Part II OTHER INFORMATION

Item 1. Legal Proceedings

For information regarding certain legal proceedings pending against us, see Note 15 of the Notes to the Consolidated Financial Statements (unaudited) in this Form 10-Q. Also see “Risk Factors—Legal and Regulatory Risks—Legal and regulatory actions” included in our Annual Report on Form 10-K for the year ended December 31, 2022.

Item 1A. Risk Factors

You should carefully consider the risks described in the “Risk Factors” section included in our Annual Report on Form 10-K for the year ended December 31, 2022. Risks to which we are subject also include, but are not limited to, the factors mentioned under “Note Regarding Forward-Looking Statements and Information” above and the risks of our businesses described elsewhere in this Quarterly Report on Form 10-Q.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

INDEX TO EXHIBITS


Number		Description
31.1	#	Section 302 Certification made by the registrant’s Chief Executive Officer
31.2	#	Section 302 Certification made by the registrant’s Chief Financial Officer
32.1	#	Section 906 Certification made by the registrant’s Chief Executive Officer
32.2	#	Section 906 Certification made by the registrant’s Chief Financial Officer
101.INS		XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
104		Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibits 101).

______________

# Filed herewith.

GLOSSARY

Selected Financial Terms


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 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.

Fee-Type Revenue			Revenue from fees and related items, including policy charges and fee income, premiums, investment management and service fees, and other income.

Gross Premiums			First year premium and deposits and renewal premium and deposits.


Invested assets			Includes fixed maturity securities, equity securities, mortgage loans, policy loans, alternative investments and short-term investments.


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.


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”).


Product Terms






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.


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.


EQUI-VEST Group (“EG”)			A traditional variable deferred annuity without enhanced guaranteed benefits with single and ongoing premiums sold in the tax-exempt 403(b)/(457(b) markets.

EQUI-VEST Individual (“EI”)			A traditional variable deferred annuity without enhanced guaranteed benefits sold in the individual market.

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			The invested assets held in the General Account.

General Account			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.

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).

GMxB Core			Retirement Cornerstone and Accumulator sold 2011 and later.

GMxB Legacy			Fixed-rate GMxB business written prior to 2011

Guaranteed income benefit (“GIB”)			An optional benefit which 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.


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 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.

Investment Edge (“IE”)			A traditional variable deferred annuity without enhanced guaranteed benefits that provides tax-efficient distribution.

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.

Rider			An optional feature or benefit that a policyholder can purchase at an additional cost.

Roll-up rate			The guaranteed percentage that the benefit base increases by each year.

Separate Account			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.

Surrender charge			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.


Surrender rate			Represents annualized surrenders and withdrawals as a percentage of average AV.

Universal life (“UL”) products			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.

Variable annuity			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.

Variable Universal Life (“VUL”)			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.

ACRONYMS

•“AB” or “AllianceBernstein” means AB Holding and ABLP.

•“AFS” means available-for-sale

•“AOCI” means accumulated other comprehensive income

•“ASC” means Accounting Standards Codification

•“ASU” means Accounting Standards Update

•“AXA” means AXA S.A., a société anonyme organized under the laws of France, and formerly our controlling stockholder.

•“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.

•“BPs” means basis points

•“CDS” means credit default swaps

•“CECL” means current expected credit losses

•“COI” means cost of insurance

•“COLI” means corporate owned life insurance

•“Holdings” means Equitable Holdings, Inc. with its consolidated subsidiaries

•“CS Life” means Corporate Solutions Life Reinsurance Company, a Delaware corporation and a wholly-owned direct subsidiary of Holdings.

•“CS Life RE” means CS Life RE Company, an Arizona corporation and a wholly-owned indirect subsidiary of Holdings.

•“CSA” means credit support annex

•“CTE” means conditional tail expectation

•“DAC” means deferred policy acquisition costs

•“DSC” means debt service coverage

•“DSI” means deferred sales inducement

•“EAFE” means European, Australasia, and Far East

•“EFS” means Equitable Financial Services, LLC, a Delaware corporation and a wholly-owned direct subsidiary of Holdings.

•“EIMG” means Equitable Investment Management Group, LLC, a Delaware limited liability company and a wholly-owned indirect subsidiary of Holdings.

•“EIM” means Equitable Investment Management, LLC, a Delaware limited liability company and wholly-owned indirect subsidiary of Holdings.

•“Equitable Distributors” means Equitable 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.

•“Equitable Financial” means Equitable Financial Life Insurance Company, a New York corporation, a life insurance company and a wholly-owned subsidiary of EFS.

•“ETF” means exchange traded funds

•“Exchange Act” means Securities Exchange Act of 1934, as amended

•“FABN” means Funding Agreement Backed Notes Program

•“FASB” means Financial Accounting Standards Board

•“FHLB” means Federal Home Loan Bank

•“Holdings” means Equitable Holdings, Inc.

•“ISDA Master Agreement” means International Swaps and Derivatives Association Master Agreement

•“IUS” means Investments Under Surveillance

•“LIBOR” means London Interbank Offered Rate

•“LTV” means loan-to-value

•“MD&A” means Management’s Discussion and Analysis of Financial Condition and Results of Operations

•“MRBs” means market risk benefits

•“MSO” means Market Stabilizer Option

•“NAIC” means National Association of Insurance Commissioners

•“NAR” means net amount at risk

•“NAV” means net asset value

•“NLG” means no-lapse guarantee

•“NYDFS” means New York State Department of Financial Services

•“OCI” means other comprehensive income

•“OTC” means over-the-counter

•“REIT” means real estate investment trusts

•“SCS” means Structured Capital Strategies

•“SEC” means U.S. Securities and Exchange Commission

•“SIO” means structured investment option

•“SPE” means special purpose entity

•“TDRs” means troubled debt restructurings

•“TIPS” means treasury inflation-protected securities

•“U.S. GAAP” means accounting principles generally accepted in the United States of America

•“UL” means universal life

•“ULSG” means universal life products with secondary guarantee

•“VIAC” means Venerable Insurance and Annuity Company

•“VIE” means variable interest entity

•“VOE” means voting interest entity

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, Equitable Financial Life Insurance Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


Date: May 8, 2023	EQUITABLE FINANCIAL LIFE INSURANCE COMPANY

	By:	/s/ Robin M. Raju
		Name:	Robin M. Raju
		Title:	Chief Financial Officer (Principal Financial Officer)

Date: May 8, 2023	By:	/s/ William Eckert
		Name:	William Eckert
		Title:	Chief Accounting Officer (Principal Accounting Officer)