F&G Investor Update Winter 2024
Disclaimer & Forward-Looking Statements 2F&G Investor Update | Winter 2024 This presentation contains forward-looking statements that are subject to known and unknown risks and uncertainties, many of which are beyond our control. Some of the forward-looking statements can be identified by the use of terms such as “believes”, “expects”, “may”, “will”, “could”, “seeks”, “intends”, “plans”, “estimates”, “anticipates” or other comparable terms. Statements that are not historical facts, including statements regarding our expectations, hopes, intentions or strategies regarding the future are forward-looking statements. Forward-looking statements are based on management's beliefs, as well as assumptions made by, and information currently available to, management. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. The risks and uncertainties which forward-looking statements are subject to include, but are not limited to: general economic conditions and other factors, including prevailing interest and unemployment rate levels and stock and credit market performance; natural disasters, public health crises, international tensions and conflicts, geopolitical events, terrorist acts, labor strikes, political crisis, accidents and other events; concentration in certain states for distribution of our products; the impact of interest rate fluctuations; equity market volatility or disruption; the impact of credit risk of our counterparties; changes in our assumptions and estimates regarding amortization of our deferred acquisition costs, deferred sales inducements and value of business acquired balances; regulatory changes or actions, including those relating to regulation of financial services affecting (among other things) underwriting of insurance products and regulation of the sale, underwriting and pricing of products and minimum capitalization and statutory reserve requirements for insurance companies, or the ability of our insurance subsidiaries to make cash distributions to us; and other factors discussed in “Risk Factors” and other sections of the Company’s Form 10-K and other filings with the Securities and Exchange Commission.
Non-GAAP Financial Measures 3F&G Investor Update | Winter 2024 Generally Accepted Accounting Principles ("GAAP") is the term used to refer to the standard framework of guidelines for financial accounting. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizing transactions and in the preparation of financial statements. In addition to reporting financial results in accordance with GAAP, this document includes non-GAAP financial measures, which the Company believes are useful to help investors better understand its financial performance, competitive position and prospects for the future. Management believes these non-GAAP financial measures may be useful in certain instances to provide additional meaningful comparisons between current results and results in prior operating periods. Our non-GAAP measures may not be comparable to similarly titled measures of other organizations because other organizations may not calculate such non-GAAP measures in the same manner as we do. The presentation of this financial information is not intended to be considered in isolation of or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. By disclosing these non-GAAP financial measures, the Company believes it offers investors a greater understanding of, and an enhanced level of transparency into, the means by which the Company’s management operates the Company. Any non-GAAP measures should be considered in context with the GAAP financial presentation and should not be considered in isolation or as a substitute for GAAP net earnings, net earnings attributable to common shareholders, or any other measures derived in accordance with GAAP as measures of operating performance or liquidity. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures are provided within.
✓ Market leading, multi-channel sales platform ✓ Achieved record sales in 2024 ✓ Record AUM before flow reinsurance and retained AUM ✓ Continued strong performance from our diversified, well positioned and high quality investment portfolio ✓ Generating both ROA and ROE expansion from strong and diversifying earnings generation and balanced capital allocation ✓ Strong balance sheet provides flexibility to optimize growth and return capital to shareholders ✓ F&G’s market capitalization was $5.3B at YE2024, as compared to $2.4B at NYSE listing (eff. 12/1/2022) Fourth quarter rounded out an exceptionally strong year; making strong progress toward Investor Day targets 2024 Adjusted ROA2 1.27% Above 1.10% baseline Executing To Deliver Shareholder Value 4F&G Investor Update | Winter 2024 1As of 12/31/2024 2Attributable to common shareholders; metrics refer to return on assets ex significant items and adjusted return on equity ex AOCI and ex significant items 2024 Gross Sales $15.3B + 16% YoY 2024 Net Sales $10.6B + 15% YoY AUM1 $53.8B + 10% YoY AUM before flow reinsurance1 $65.3B + 17% YoY 2024 Capital Return to Shareholders $125M Market Capitalization1 $5.3B 2024 Adjusted ROE2 12% + 2% YoY
ANE ($M) and Per Share 4Q23 4Q24 Favorable / (Unfavorable) ($M) Per share ($M) Per share Alternatives investment short-term returns versus long-term return expectations (37) ($0.30) (32) ($0.25) Other significant (income) expense items (19) ($0.15) 22 $0.17 Fourth Quarter & Full Year Financial Highlights 5F&G Investor Update | Winter 2024 1Attributable to common shareholders ($M) - except per share data and ROA Quarterly Full Year 4Q23 4Q24 2023 2024 Gross sales $4,083 $3,469 $13,153 $15,262 Net sales $2,549 $2,438 $9,238 $10,571 Assets under management (AUM) $49,103 $53,817 $49,103 $53,817 AUM before flow reinsurance $55,928 $65,274 $55,928 $65,274 Adjusted return on assets (ROA)1 0.73% 1.06% 0.73% 1.06% Net earnings (loss)1 ($299) $323 ($58) $622 Net earnings (loss) per diluted share1 ($2.41) $2.50 ($0.47) $4.88 Adjusted net earnings (ANE)1 $75 $143 $335 $546 Adjusted net earnings per diluted share1 $0.60 $1.12 $2.68 $4.30 Adjusted weighted average diluted shares 125 131 125 131 Adjusted ROA – ex significant items1 1.17% 1.27% 1.17% 1.27% ANE – ex significant items1 $131 $153 $539 $657 ANE per diluted share – ex significant items1 $1.05 $1.20 $4.31 $5.15 F&G expects steady and growing adjusted net earnings over time, excluding significant items which include short-term mark-to-market effects ANE ($M) and Per Share 2023 2024 Favorable / (Unfavorable) ($M) Per share ($M) Per share Alternatives investment short-term returns versus long-term return expectations (153) ($1.22) (145) ($1.11) Other significant (income) expense items (51) ($0.41) 34 $0.26 Significant Items – Full Year Significant Items – Quarterly Financial Highlights
About F&G Snapshot 6F&G Investor Update | Winter 2024 Retail Annuities • Fixed indexed annuity (FIA) • Registered index-linked annuities (RILA) • Multi-year guaranteed annuity (MYGA) Pension Risk Transfer (PRT) Life Insurance • Indexed universal life (IUL) Funding Agreements • Funding agreement backed notes (FABN) • Federal Home Loan Bank (FHLB) • Founded in 1959 as a life insurance company • Listed on the New York Stock Exchange (NYSE: FG) eff. 12/1/2022 • Fidelity National Financial (NYSE: FNF) retains ~85% ownership • Headquartered in Des Moines, IA; 1,300+ employees • Ranking as a Top Workplaces company for 7 consecutive years Retail Channels • Independent insurance agents (IMOs) • Broker Dealers • Banks Institutional Markets • Pension risk transfer • Funding agreements Our Product Lines Five Distinct Distribution Channels / Markets Background Financial Strength Ratings A Stable A.M. Best A- Stable S&P Global A- Stable Fitch Ratings A3 Stable Moody’s
F&G’s Competitive Advantages 7F&G Investor Update | Winter 2024 v Track Record of Success We have delivered consistent top line growth and return on assets across varying market cycles, and we expect to continue to outperform the rest of the market, whether rates are rising or falling v Targeting Large and Growing Markets We have long-standing relationships with multiple distribution channels, an investment edge, and a track record of attracting top talent Superior Ecosystem F&G is a nationwide leader in the large markets we play in, and we expect demographic trends will provide tailwinds to give us significant room to continue growing – including untapped Middle Market demand for Life coverage and the opportunity to migrate consumers from CDs to fixed annuities Driving Margin Expansion and Improved Returns F&G is pursuing strategies to grow earnings, while generating significant positive net cash flow and diversifying into “capital light” flow reinsurance and accretive owned distribution to generate higher ROEs
We Have Generated Strong Returns Over Time 8F&G Investor Update | Winter 2024 1Calculated as adjusted net earnings attributable to common shareholders ex significant items on a rolling four quarter basis, divided by average F&G equity attributable to common shareholders ex accumulated other comprehensive income (ex AOCI) utilizing the average of five points throughout the period; 2020 reflects post merger period from 6/1/2020 to 12/31/2020 2Calculated as F&G equity attributable to common shareholders ex AOCI divided by common shares outstanding; effect of LDTI and actuarial system conversion reflected in 1x items Adjusted Return on Equity (ROE) ex AOCI1 Cumulative period from 2020 to 2024 Book Value Per Share (BVPS) ex AOCI2 Cumulative period from YE 2020 to YE 2024 8% 12% 7% (3%) 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% 2020 Adjusted Net Earnings MTM & Other Equity 2024 $27.40 $40.50 $44.28 14.73 (1.63) 3.78 YE 2020 Net Earnings Return of Capital BVPS Before MTM MTM & 1x Items YE 2024 Strong earnings generation combined with balanced capital allocation have been driving sustainable ROE expansion and BVPS growth since 2020 acquisition by FNF +4 pts ROE Expansion +62% BVPS Growth
We Are Driving Toward Our Investor Day Targets • Spread-based earnings • Driven by asset growth • Margin expansion through investment margin & scale benefit Retained Sales • Fee-based earnings • Lower marginal cost of capital • Enhances cash flow • Accretive to return on equity Flow Reinsurance • Fee-based earnings • Lower marginal cost of capital • Accretive to return on equity • Solidifies relationships with key partners Owned Distribution We remain focused delivering margin expansion through our retained business, as well as diversifying sources of earnings through accretive flow reinsurance and owned distribution Grow AUM by 50% Expand adjusted ROA ex significant items to 1.33% to 1.55% Increase adjusted ROE ex AOCI and significant items to 13 to 14% Expand our P/E multiple to 7-8x We continue to make good progress toward the medium term financial targets laid out at our 2023 Investor Day: F&G Investor Update | Winter 2024 9
We Have A Clean & Profitable Inforce Book 10F&G Investor Update | Winter 2024 Our inforce liabilities are surrender charge protected and our asset and liability cash flows are well matched; our inforce book does not contain typical problematic legacy business • Our liability profile drives our investment strategy • Retail fixed annuities are 93% surrender protected1 • Non-surrenderable liabilities include funding agreements, pension risk transfer and immediate annuities • New business and inforce are actively managed to maintain pricing targets • Asset and liability cash flows are well matched 1As of 12/31/2024 GAAP Net Reserves1 58% Indexed Annuities 12% Pension Risk Transfer 12% Fixed Rate Annuities 10% Funding Agreements 5% Life 3% Immediate Annuities $52B Retail Fixed Annuity Metrics YE 2024 Weighted average time remaining in surrender charge period 5.5 Years % Surrender protected 93% Average remaining surrender charge (% of account value) 7% % Subject to market value adjustment (MVA) 78% Average cost of options/interest credited 3% Distance to guaranteed minimum crediting rates 215 bps
We Are Playing In High Growth Markets 11F&G Investor Update | Winter 2024 The U.S. retirement and middle markets are growing and we are both well established and well positioned for continued growth in our retail channels and institutional markets 13Q24 Quarterly Retirement Market Data, Investment Company Institute. 2Personal savings in the U.S. per Federal Reserve Bank of St. Louis as of 11/1/24. 3U.S. Pension Risk Transfer Sales soar 36% in the third quarter 2024, Source LIMRA, 12/10/24. 4Legal & General Pension Risk Transfer Monitor, September 2024 Market Update. 53Q24 U.S. retail life sales (annualized premium) and U.S. individual annuity sales per LIMRA. 6Board of Governors of the Federal Reserve System, Funding Agreement-Backed Securities (FABS) as of 9/30/24 Registered index linked annuities (RILAs) provide alternative with upside potential and limited downside risk Consumers increasingly rely on personal savings for retirement income Untapped demand for permanent life insurance, especially in the Middle Market Transaction volume likely to continue4 Mutual Fund 401(k) Assets1 U.S. Consumer Savings2 Pension Risk Transfer3 Retail Life & Annuities5 Funding Agreements6 $5.4T $968B $341B $298B $210B
58 63 71 76 78 80 82 2022 2025 2030 2035 2040 2045 2050 … With Secular Tailwinds Driving Demand 12F&G Investor Update | Winter 2024 We continue to see sustainable demand for our retail fixed annuity products given current environment • U.S. consumers are holding more than $4 trillion in retail money market fund assets; once money market rates start to decline, they are expected to lock in higher interest rates through attractive solutions like fixed annuities • We serve a growing retirement population, with more than 10,000 Americans turning 65 every day and a projected 30% increase in people aged 65-100 over the next 25 years • Attractive demographics support growing demand for our products, as both retirees and advisors turn to fixed annuities as an alternative to the traditional 60/40 investment portfolio 1Source: Investment Company Institute (ICI); periods prior to 2024 reflect “total” all money market funds 2Source: U.S. Census Bureau, Population Division; Projected Population by Age Group and Sex for the United States, Main Series: 2022-2100 (Released Nov 2023) U.S. Money Market Fund Assets ($Trillions)1 Projected U.S. Population: Ages 65-100 (Millions)2 Number of people aged 65-100 is projected to increase 30% over the next 25 years 4.1 2.7 3.6 4.3 4.7 4.7 5.9 6.8 YE 2019 YE 2020 YE 2021 YE 2022 YE 2023 YE 2024 Combined Institutional only Retail only
… And We’re Winning … 13F&G Investor Update | Winter 2024 1CAGR reflects 2019-2024 annual periods Annual Gross Sales by Retail Channel and Institutional Market ($B) 2019 2020 2021 2022 2023 2024 Funding Agreements Agent PRT Broker Dealer Bank $11.3B $9.6B $4.5B $3.9B FNF and F&G Merger (June 2020) $13.2B +31% CAGR1 $15.3B
46% 27% 5% 7% 15% $15.3B … While Significantly Diversifying Our Business 14F&G Investor Update | Winter 2024 Note: Reflects Gross Sales 38% 31% 7% 9% 15% $13.2B 84% 5% 7% 4% $4.5B FY2023 Sales C h a n n e l P ro d u c t 36% 39% 1% 9% 15% $13.2B 77% 17% 1% 5% $4.5B FY2020 Sales FY2024 Sales 44% 33% 1% 7% 15% $15.3B Bank Broker Dealer Agent Funding Agreements Pension Risk Transfer (PRT) Multi-year Guaranteed Annuity (MYGA) Indexed Universal Life (IUL) Funding Agreements Indexed Annuities (FIA/RILA) Pension Risk Transfer (PRT)
Our Owned Distribution Track Record 15F&G Investor Update | Winter 2024 Our owned distribution strategy is contributing to margin expansion and is a capital light, diversified source of fee-based earnings Portfolio is performing as expected • FY2024 EBITDA (cash): ~$65M • Owned distribution margin driven by seasonality, timing of dividends, mix of business & affiliated vs. unaffiliated sales • Owned distribution margin of $46M FY2024 (ANE) • Adjusted ROA contribution of 9 bps (ANE) • GAAP reporting items to note: • Owned distribution margin reflects dividend income from minority-owned interests, plus percent share of margin for majority-owned interests • Affiliated revenue from F&G products sold by owned distribution is reflected in our product margin1, not the owned distribution margin Life Network Marketing IMO Traditional Annuity IMO “B2B” Annuity IMO Life Brokerage IMO ~$680M Cumulative deals closed 1Amount of affiliated revenue from F&G products sold by owned distribution and reflected in product margin (not the owned distribution margin): $10M in 4Q24 and $22M in FY2024
58% NAIC 1 25% NAIC 2 6% LP 5% Cash³ 3% Other² 2% NAIC 3 1% NAIC 4/5/6 30% Corporates 23% Structured Securities 15% Private Origination 11% Mortgage Loans 6% Alternatives (LP) 4% Gov't & Treasury 3% Other ² 3% Municipal 2% EMD 2% Pfd/Hybrid 1% Cash Our High Quality & Well-Diversified Portfolio1 16F&G Investor Update | Winter 2024 1GAAP Fair Values as of 12/31/2024. For Alts LP, NAV as of 9/30/2024 (net of reinsurance FWH) 2Other consists of ICOLI, FHLB stock, LIHTC, options and private origination equity tranches 3Cash includes actual cash and treasuries Investment Portfolio by Asset Class Investment Portfolio by NAIC Designation Portfolio conservatively positioned & well-matched to liability profile • Fixed income is 97% investment grade • Modest credit-related impairments of 6 bps over last 5 years, below pricing assumption • Net floating rate exposure of $3.2B or 6% of the portfolio CMBS/CML portfolios are high quality, with moderate leverage and diversified across property types • Modest office exposure at only 1.7% of the total portfolio • Alternative LPs comprise 6% of total portfolio, with only 0.7% of Alternative LPs portfolio in office $50B $50B
Our Investment Portfolio Key Attributes 17 Investment Rationale • Core fixed income: Focus remains high grade public and private securities with strong risk adjusted returns • Structured credit: Provides access to well diversified, high-quality assets across CLOs, CMBS and ABS • Mortgage loans: Superior loss-adjusted performance relative to similar rated corporates • Direct Origination: Diversified private credit exposure to a wide spectrum of underlying collateral Fixed Income1,2 (ex. Structured, Mortgage Loan & Private Origination) 1GAAP Fair Values as of 12/31/2024 (net of reinsurance FWH) 2Excludes $5.0B of alternatives/equity, FHLB, call options and cash 3Other consists of data center, mixed use and hotel properties Structured Credit Portfolio1,2 61% Residential 19% Multifamily 10% Industrial 5% Office 2% Retail 2% Other³ 1% Student Housing Private Origination Portfolio1,2 73% Corporates 10% Gov't & Treasury 7% Municipal 6% EMD 4% Prf/Hybrid $21B 35% CMBS 33% CLOs 17% ABS 15% Non Agency RMBS 0% Agency RMBS $11B Mortgage Loans1,2 $5B 49% Corporate Lending 24% Private Specialty Finance 22% Asset Backed & Consumer Loans 5% Triple Net Lease $8B F&G Investor Update | Winter 2024
Net Sales 9.0 9.2 10.6 2.5 2.5 8.5 10.0 12.0 3.0 2.5 2.8 3.2 3.3 11.3 13.2 15.3 4.1 3.5 2022 2023 2024 4Q23 4Q24 Institutional Markets Retail Channels 353 335 546 75 143 2022 2023 2024 4Q23 4Q24 Our Track Record of Profitable Growth Gross Sales ($B) Average Assets Under Management (AAUM) ($B) Common Adjusted Net Earnings (ANE) ($M) F&G Investor Update | Winter 2024 18 40.1 46.0 51.6 46.0 51.6 2022 2023 2024 4Q23 4Q24 +12% VPY2024 VPY: 12% Ending AUM 43.6 49.1 53.8 49.1 53.8 AUM before flow reinsurance 46.4 55.9 65.3 55.9 65.3 (15%) VPY2024 VPY: 16% ANE ANE ex significant items Significant items For further details on significant items, see Appendix
Our Robust Gross Sales With Pricing Discipline Gross Sales Growth ($B) 8.5 10.0 12.0 3.0 2.8 3.2 3.5 2.5 2.8 3.2 3.3 1.1 0.7 1.2 0.4 1.0 11.3 13.2 15.3 4.1 3.5 4.4 3.9 3.5 2022 2023 2024 4Q23 1Q24 2Q24 3Q24 4Q24 Institutional markets Retail channels F&G Investor Update | Winter 2024 2024 VPY: 16% 4Q24 VPY: (15%) 19 Gross sales across multi-channel new business platform reflect strong momentum and demand for our products, due to favorable market conditions and secular demand • FY2024 gross sales reflect record retail channel sales and robust institutional market sales; sales volumes effectively managed within profitability & capital targets • 4Q24 gross sales down from near record 4Q23; this reflects our decision to allocate capital to the highest returning business, specifically indexed annuity and pension risk transfer sales, which resulted in a reduction in MYGA sales and funding agreements • Net sales reflect third party flow reinsurance at varying ceded amounts, in line with our capital targets • Record AUM before flow reinsurance of $65.3B; this includes retained ending AUM of $53.8BNet Sales 9.0 9.2 10.6 2.5 2.3 3.4 2.4 2.5 Ending AUM 43.6 49.1 53.8 49.1 49.8 52.2 52.5 53.8 AUM before flow reinsurance 46.4 55.9 65.3 55.9 58.0 61.4 62.9 65.3
353 335 546 75 108 139 156 143 2022 2023 2024 4Q23 1Q24 2Q24 3Q24 4Q24 Net earnings (loss) 635 (58) 622 (299) 111 198 (10) 323 Op Exp (bps) 59 63 60 63 63 61 62 60 ANE per share $3.07 $2.68 $4.30 $0.60 $0.86 $1.10 $1.22 $1.12 Adj. ROA1 1.18% 1.17% 1.27% 1.17% 1.25% 1.30% 1.32% 1.27% Adj. ROE1 10% 10% 12% 10% 11% 12% 12% 12% Steady & Growing Adjusted Return on Assets 20F&G Investor Update | Winter 2024 Common Adjusted Net Earnings (ANE) ($M) Note: Reflects metrics attributable to common shareholders 1Reflects ANE ex significant items F&G expects steady and growing adjusted net earnings over time, excluding significant items • ANE ex significant items reflects: • asset growth, • margin diversification (flow reinsurance & owned distribution), • disciplined expense management, and • higher interest expense on debt (vs. prior year) • Adjusted ROA at 1.27%, +10 bps over prior year1 • Adjusted ROE at 12%, +2% over prior year1 • For further details on significant items, see Appendix ANE ANE ex significant items Significant items
537 bps 298 bps 16 bps 9 bps (137) bps 127 bps1,2 Portfolio Earned Yield Cost of Funds Flow Reinsurance Fee Income Owned Distribution Margin Expenses (Operating, Interest, Taxes, Pref. Dividends) Common Adjusted Net Earnings excluding significant items Our Scalable Adjusted ROA Model1 – FY2024 21F&G Investor Update | Winter 2024 1Attributable to common shareholders. Metric refers to adjusted return on assets ex significant items 2See discussion of significant income and expense items in the Appendix 3Overall Product margin = portfolio earned yield – cost of funds Unique Investment Capabilities Attractively Priced Liabilities Scalable Operating Platform Strong Earnings Growth Potential Product Margin3: 2.39% 6 $657M 1 2 5 6 1 2 3$2,767M $1,533M $80M $46M $703M Accretive Flow Reinsurance Owned Distribution 3 4 4 5 Achieving margin expansion above Investor Day 110 bps baseline
80 84 93 118 117 127 2019 2020 2021 2022 2023 FY2024 0 bps 20 bps 40 bps 60 bps 80 bps 100 bps 120 bps 140 bps 160 bps 180 bps 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% Our Expanding ROA Despite Volatile Rates F&G’s primary “spread model” generates stable return on assets (ROA) despite volatility in interest rates • 2019-2021: Maintained adjusted ROA despite precipitous drop in interest rates • 2022-2024: Expanded adjusted ROA from scale, accretive flow reinsurance and owned distribution • FY2024 adjusted ROA at 127 bps; steady margin expansion Adjusted Return on Assets1 vs. 10-year UST Yield 1Attributable to common shareholders. Metric refers to adjusted return on assets ex significant items Adjusted Return on Assets (bps) F&G Investor Update | Winter 2024 22 10-Year UST Maintained ROA in falling interest rate environment Expanding ROA as margins benefit from scale, accretive flow reinsurance and owned distribution
Our Stable and Strong Capital Profile 23F&G Investor Update | Winter 2024 1Excluding accumulated other comprehensive income (ex AOCI) Total Capitalization ex AOCI1 ($M) 5,223 5,093 5,749 5,749 250 250 1,100 1,760 2,195 2,270 6,323 6,853 8,194 8,269 YE 2022 YE 2023 YE 2024 Pro Forma YE 2024 Debt Preferred Stock Total Equity ex. AOCI Adj. Debt to Capital % 17.4% 25.7% 26.8% 27.5% Solid F&G capitalization; debt-to-capitalization ratio managed to long term target of 25% • In 2024, issued preferred stock and senior notes to support future growth, liquidity & full revolver paydown, as planned • Pro Forma 2024 reflects recent developments: • In January 2025, $375M junior subordinated notes issued; net proceeds to used for general corporate purposes including repayment of debt • In February 2025, $300M senior notes due in May 2025 fully redeemed • Balance sheet expected to naturally delever as a result of growth in total equity, excluding AOCI
2020 2021 2022 2023 2024 We Are Achieving Higher Ratings Over Time 24F&G Investor Update | Winter 2024 Upgraded to ‘A-’ FNF Merger Completed F&G Partial Spinoff $2.4B Market Cap Launched Flow Reinsurance Launched Owned Distribution F&G at 12/31/2024 $5.3B Market Cap Upgraded to ‘A-’ Upgraded to ‘Baa1’ Upgraded to ‘A3’ Upgraded to ‘A’ Launched Bank & Broker Dealer Channels Launched Institutional Markets (PRT & FABN) F&G has received multiple ratings upgrades over time, reflecting our upward trajectory • Scaling business to generate profitable growth • Diversifying sources of earnings • Actively positioning our high quality and diversified investment portfolio • Maintaining strong capitalization and financial flexibility • Conservatively managing to the most stringent capital requirements of our regulators & rating agencies, including our offshore entities Upgraded long-term issuer rating Note: Reflects financial strength rating of primary operating subsidiaries F&G’s Recent History
Our Capitalization Supports Growth & Dividend 25F&G Investor Update | Winter 2024 F&G’s capital allocation priorities focus on deploying capital to best maximize shareholder value through both continued investment in our business and generation of distributable cash for return of capital to shareholders • F&G has flexibility to adjust retained sales level, as a “lever” to support net cash from operations with sustained asset growth • F&G has returned $125M of capital to shareholders in FY2024 through common and preferred dividends Investing for Growth Reinvest in the Business Capital and other investments to support the growth strategy and maintain adequate capital buffer Net Cash from Operations Return to Shareholders Common Dividend Payout Upon board approval, common dividend with potential targeted increases over time ► Maintain efficient capital structure ► Target long-term debt-to-total capitalization excl. AOCI of approximately 25% ► Maintain solvency and capital targets in line with ratings Share Repurchase Efficient means of returning cash to shareholders when shares trade at discount to intrinsic value
APPENDIX Appendix – Investments
Investment Portfolio Stress Testing 27F&G Investor Update | Winter 2024 • Moderate, Severe Recession and Stagflation scenarios modeled by F&G and Blackstone investments and risk teams • Moderate Recession: Based on characteristics from recessions in 1990/1991 (1st Gulf War), 2001 (dot-com and 9/11) and 2020 (COVID-19) • Severe Recession: Based on characteristics from the Great Recession (2007-2009) • Stagflation: Introduced to provide perspective to risks potentially emerging from current macroeconomic trends • Methodology: Used cumulative historical credit migration, defaults, and recoveries assuming instantaneous shock with no management actions • Top-down losses and credit migration applied to corporates, muni’s, preferred stock and alternatives • Bottom’s up, collateral level loss modeling for CLO’s, CMBS and RMBS; applied Global Financial Crisis (GFC) collateral level constant default rates (CDRs) and severity to post-GFC (2.0/3.0) structures which feature higher levels of subordination and tighter collateral eligibility requirements Stress Testing Scenarios and Methodology
Stress Test: Results & No Management Actions 28F&G Investor Update | Winter 2024 Stress Test Scenario Results by Asset Class 1Stress test assumption as of 12/31/2024 2Reflects fixed income other than temporary impairment (OTTI) Before Stress Test, excess capital at 350% RBC is $0.5B1 Moderate Recession Severe Recession Stagflation 4Q24 Portfolio Allocation Stat Loss ($B) Loss % per Asset Class Stat Loss ($B) Loss % per Asset Class Stat Loss ($B) Loss % per Asset Class Corporates & Municipals (OTTI) 41% (0.1) -0.3% (0.1) -0.5% (0.1) -0.3% Structured Assets (CLO/ABS) (OTTI) 28% (0.0) -0.3% (0.1) -0.4% (0.0) -0.3% Commercial Mortgages (CML/CMBS) (OTTI) 13% (0.1) -0.7% (0.1) -1.1% (0.1) -0.7% Residential Mortgages (RML/RMBS) (OTTI) 11% (0.0) -0.5% (0.0) -0.9% (0.0) -0.5% Subtotal Fixed Income2 93% (0.2) -0.4% (0.3) -0.6% (0.2) -0.4% Alternative MTM 6% (0.5) -16.0% (0.8) -25.0% (0.6) -20.2% Preferred Stock MTM 1% (0.0) -6.8% (0.0) -14.0% (0.0) -6.8% Subtotal Equity 7% (0.5) -15.3% (0.8) -24.1% (0.6) -19.2% Total 100% (0.7) -1.4% (1.1) -2.3% (0.8) -1.7% Incremental Required Capital Impacts (Credit Drift @ 350) 0.2 0.3% 0.1 0.2% 0.2 0.3% Total Impact on Excess Capital (0.5) -1.1% (1.0) -2.1% (0.6) -1.3% • Impact of default losses & credit drift are mitigated by reduced required capital from lower alternative asset market value and improved covariance benefit • Mark-to-market (MTM) impact on alternatives is unrealized and would be expected to recover over time, consistent with historical and recent experience • The stress scenarios assume an instantaneous shock on 12/31/24 investment portfolio, with no additional earnings on the underlying inforce block
Stress Test: Management Actions to Mitigate Impact 29F&G Investor Update | Winter 2024 Capital Position Before & After Stress & Management Actions ($B) Moderate Stress Impact on Excess Capital Severe Stress Impact on Excess Capital Stagflation Impact on Excess Capital Total Excess CapitalDecreaseIncrease Base modeling assumed no management actions; however active portfolio management affords many opportunities to mitigate loss and credit drift impact • Alts & Preferred Stock MTM losses are considered temporary (unrealized) and expect to normalize over time • Management levers available to provide near term benefit of up to $1.3B • +$150M reduced new business by $1B for one year • +$200M increased reinsurance activity, reducing retained by $3B • +$950M revolver capacity utilization ($750M FG + $200M FNF) • After Moderate Stress excess capital remains; no management actions required to maintain positive excess capital • After Severe Stress and Stagflation, $1.3B management actions are more than sufficient to return to positive excess capital 0.5 (1.0) 0.5 0.0 Exc Cap 12/31/24 Stress Impact Mgmt Levers Used Exc Cap After Levers 0.5 (0.5) 0.0 Exc Cap 12/31/24 Stress Impact Exc Cap After Levers 0.5 (0.6) 0.1 0.0 Exc Cap 12/31/24 Stress Impact Mgmt Levers Used Exc Cap After Levers
12% Royalty & Licensing 9% Lender Finance 8% Residential Solar 7% Home Improvement 7% Private Equity Finance 6% Aviation 5%Whole Business 5% Manufactured Housing 5% Consumer Loans 4% Towers 32% All Other (< Top 10) Structured Credit – Why We Like It 30F&G Investor Update | Winter 2024 Investment Rationale • Collateralized loan obligation (CLO) portfolio well diversified across industry, issuer and manager; focus on investment grade with ample par subordination • Commercial mortgage-backed securities (CMBS) focus on seasoned CMBS which allows for visibility into credit performance, built-in appreciation and contractual amortization which reduces risk exposure; target more stable property types, such as multi-family, to create a defensive portfolio • Asset Backed Securities (ABS) focus on high quality, directly originated specialty finance assets diversified by collateral type CMBS by Property Type CLO Top 10 Industries ABS Top 10 Collateral Type Note: GAAP Fair Values as of 12/31/2024 (net of reinsurance FWH) 13% High Tech 12% Healthcare & Pharmaceuticals 10% Banking, Finance, Insurance & Real Estate 8% Services: Business 5% Hotels, Gaming & Leisure 4% Construction & Building 4% Capital Equipment 4% Chemicals, Plastics & Rubber 4% Telecommunications 3% Media: Broadcasting & Subscription 33% Other (< Top 10) $4B $5B $4B 41% Multifamily 14% Office 14% Industrial 10% Hotel 5% Retail 4% US Treasury 2% Mixed Use 1% Self-Storage 1% Special Purpose 1% ManufacturedHousing 7% Other (< Top 10)
Portfolio Spotlight: CLO 31F&G Investor Update | Winter 2024 Highly diversified portfolio with ample par subordination • Blackstone’s broad & deep understanding of the asset class, and ability to perform loan level underwriting, distinguishes F&G’s portfolio from its peers F&G CLO Portfolio Composition – % Fair Value Note: GAAP Fair Values as of 12/31/2024 (excluding FGLICNY assets) 1Reflects the weighted average par subordination of the CLO portfolio 17% 13% 33% 26% 11% AAA AA A BBB BB and Below Investment Grade Par Subordination 40% 28% 20% 14% 8% Credit Quality 98% investment grade Structural Protection 23% par subordination1 Capital Efficiency 1.32 Average NAIC rating Market Value $3.8B CLO exposure
Our CLO Portfolio: Look Through Analysis 32F&G Investor Update | Winter 2024 Portfolio focused on high quality CLO securities backed by highly diversified pool of loans Note: GAAP Fair Values as of 12/31/2024 IndustriesCompaniesCLO Managers 89 CLO managers 1,916 Companies 32 Industries 7.9% 3.5% 3.3% 3.2% 3.1% 2.9% 2.8% 2.7% 2.6% 2.5% 65.5% 0.0% 5.0% 10.0% 15.0% Manager 1 Manager 2 Manager 3 Manager 4 Manager 5 Manager 6 Manager 7 Manager 8 Manager 9 Manager 10 Other 70% 0.7% 0.5% 0.5% 0.4% 0.4% 0.4% 0.4% 0.4% 0.4% 0.4% 95.5% 0.0% 0.5% 1.0% 1.5% 2.0% Issuer 1 Issuer 2 Issuer 3 Issuer 4 Issuer 5 Issuer 6 Issuer 7 Issuer 8 Issuer 9 Issuer 10 Other 100.0% 12.8% 11.9% 10.3% 7.8% 5.1% 4.4% 4.3% 3.7% 3.6% 3.5% 32.6% 0.0% 5.0% 10.0% 15.0% 20.0% Industry 1 Industry 2 Industry 3 Industry 4 Industry 5 Industry 6 Industry 7 Industry 8 Industry 9 Industry 10 Other 40.0%
U.S. CLO Impairment Frontier 33F&G Investor Update | Winter 2024 CLO debt is well insulated from higher defaults and lower recovery rates • BBB CLOs can withstand an annualized default of 9.4% (that would have to occur every year) assuming a 63.5% average long- term loan recovery rate U.S. CLO Impairment Frontier (First-Loss Scenarios among CLO tranches) Note: Reflects Blackstone’s views and beliefs as of December 31, 2024. Source: US J.P. Morgan as of December 31, 2024 for average recovery rate and annual loan default rate; CLO impairment frontiers generated from Intex model and include key assumptions as follows: Interest rates based on current Intex curve, annual prepayment rate of 20%, Recovery lag = 12 months, CLO redeemed at AAA payoff date in standard CLO run, reinvestment price = 99.75, reinvestment rate = 3 month Libor + 325 bps, no reinvestment post Reinvestment Period. Please note: the historical data point shown is calculated using annual default and recovery rates from J.P. Morgan Leveraged Loan Index and represents the average default rates and weighted average recovery rates from 1998-2024 for the long-term average time period. Average recovery rate is representative of first-lien loans as of December 31, 2024 0% 5% 10% 30%40%50%60%70% A n n u a l D e fa u lt R a te Average Senior Loan Recovery Rate A BBB BB Long-Term Average Annual Default Rate
Portfolio Spotlight: Real Estate Debt 34F&G Investor Update | Winter 2024 Blackstone Real Estate Debt Strategies (BREDS) has assembled a high-quality portfolio with diversified exposure across asset classes and properties Note: GAAP Fair Values as of 12/31/2024 36% CMBS 28% RML 16% CML 15% RMBS 5% NNN $11B Duration 3.8 years Quality 1.3 Average NAIC rating Market Value $11.2B Real estate portfolio Weighted Average Life 5.7 years
Portfolio Spotlight: CMBS & RMBS 35F&G Investor Update | Winter 2024 Note: GAAP Fair Values as of 12/31/2024 By Asset Type By Property Type By NAIC Rating 30% 30% 18% 10% 7% 5% 4Q24 SASB RMBS CRE CLOs Conduit (Below A) Conduit (A or above) Agency 58% 10% 9% 9% 7% 4% 3% 4Q24 Multifamily Office Other Industrial Hotel Retail Defeased 87% 6% 4% 3% 4Q24 1 2 3 4/5/6
Portfolio Spotlight: CMBS 36F&G Investor Update | Winter 2024 Prudent asset selection has led to more multifamily exposure and less retail vs. Conduit CMBS market averages Portfolio Construction Comparison1 Note: GAAP Fair Values as of 12/31/2024 1BAML Conduit Data as of 12/31/2024 41% 5% 14% 24% Multifamily Retail F&G Post-Crisis Conduit CMBS Credit Quality 91% Investment grade (NRSRO) Quality 1.5 Average NAIC rating Market Value $4.0B CMBS portfolio Credit focus A NRSRO rating
Portfolio Spotlight: CMLs 37F&G Investor Update | Winter 2024 Investment Rationale • Our Commercial Mortgage Loan (CML) portfolio is low risk, low leveraged and well diversified • All first mortgage loans, with average loan-to-value of ~60% • 73 holdings, with average loan size of $29M • 1.4% of CML portfolio loans have a DSCR <1x By State By Loan-To-Value % By Underlying Property Type Note: GAAP Fair Values as of 12/31/2024 24% CA 12% FL 6% NY 6% TX 5% NJ 5% GA 4% CT 38% Other $2B 54% LTV 60% to 70% 34% LTV 50% to 60% 11% LTV < 50% 1% LTV > 70% $2B $2B 49% Multifamily 25% Industrial 13% Office 5% Retail 4% Student Housing 4% Other
Blackstone Related Important Disclosures 38F&G Investor Update | Winter 2024 This document (together with any attachments, appendices, and related materials, the “Materials”) is provided for informational due diligence purposes only and is not, and may not be relied on in any manner as legal, tax, investment, accounting or other advice or as an offer to sell, or a solicitation of an offer to buy, any security or instrument in or to participate in any account, program, trading strategy with any Blackstone fund, account or other investment vehicle (each a “Client”) managed or advised by Blackstone Inc. or its affiliates (“Blackstone”), nor shall it or the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision. 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APPENDIX 39F&G Investor Update | Winter 2024 Appendix – Finance
Book Value Per Share Growth – FY2024 40F&G Investor Update | Winter 2024 BVPS ex AOCI of $44.28 after MTM, ↑ 10% vs. prior year • $3.75 per share increase due to underlying business performance • ($1.04) per share decrease for return of capital • $1.15 per share increase due to mark-to-market movements which are unrealized and point in time 1Attributable to common shareholders and excluding accumulated other comprehensive income (ex AOCI) 2Outstanding shares of 126,094,481 as of 9/30/2024 and 126,792,844 as of 12/31/2024 BVPS ex. AOCI1 – 12/31/2023 to 12/31/2024 $40.42 $44.17 $43.13 $44.28 3.75 (1.04) 1.15 $38.00 $39.00 $40.00 $41.00 $42.00 $43.00 $44.00 $45.00 YE 2023 ANE & Other 2024 Before MTM & Return of Capital Return of Capital 2024 Before MTM MTM Movements YE 2024 F&G Equity ex. AOCI1 ($M) 5,093 475 5,568 (91) 5,477 147 5,624 Shares O/S2 (M) 126 1 127
Non-GAAP Measure Reconciliations1 41F&G Investor Update | Winter 2024 1Refer to “Non-GAAP Measures Definitions” Year ended Three months ended ($ in millions) December 31, 2022 December 31, 2023 December 31, 2024 December 31, 2023 March 31, 2024 June 30, 2024 September 30, 2024 December 31, 2024 Net earnings (loss) attributable to common shareholders $635 ($58) $622 ($299) $111 $198 ($10) $323 Non-GAAP adjustments Recognized (gains) and losses, net Net realized and unrealized (gains) losses on fixed maturity available-for- sale securities, equity securities and other invested assets 446 98 (76) 9 (48) (37) (15) 24 Change in allowance for expected credit losses 24 48 32 15 1 21 10 — Change in fair value of reinsurance related embedded derivatives (352) 128 33 162 18 (10) 178 (153) Change in fair value of other derivatives and embedded derivatives (1) (60) 38 (72) 61 8 (127) 96 Recognized (gains) losses, net 117 214 27 114 32 (18) 46 (33) Market related liability adjustments (534) 258 (214) 353 (55) (71) 145 (233) Purchase price amortization 21 22 84 6 22 19 22 21 Transaction costs, other and non-recurring items 10 3 16 — — (3) — 19 Non-controlling interest — — (10) — (3) (2) (3) (2) Income taxes adjustment 104 (104) 21 (99) 1 16 (44) 48 Adjusted net earnings attributable to common shareholders $353 $335 $546 $75 $108 $139 $156 $143 Alternatives investment short-term returns versus long-term return expections 217 153 145 37 52 20 41 32 Other significant (income) expense items (99) 51 (34) 19 (6) 12 (18) (22) Adjusted net earnings excluding significant items $471 $539 $657 $131 $154 $171 $179 $153
ANE – Significant Items1 42F&G Investor Update | Winter 2024 1Refer to Reconciliation of net earnings (loss) to adjusted net earnings attributable to common shareholders on page 41 ($ and shares in table in millions) Significant Income and Expense Items (Reflected in Adjusted Net Earnings) Alternatives Long-term Expected Return (Not Reflected in Adjusted Net Earnings) Weighted Average Diluted Shares Outstanding Year ended December 31, 2024 Adjusted net earnings of $546 million for the year ended December 31, 2024 included $514 million of investment income from alternative investments and $46 million of CLO redemptions and bond prepay income, and $14 million tax valuation allowance, partially offset by $26 million of net expense from actuarial assumption and model updates and other items. Alternative investments investment income based on management’s long-term expected return of approximately 10% was $659 million. $548 $659 131 December 31, 2023 Adjusted net earnings of $335 million for the year ended December 31, 2023 included $405 million of investment income from alternative investments and $5 million of bond prepay income, partially offset by $37 million tax valuation allowance, $10 million of one-time fixed asset impairment charge and $9 million actuarial industry assumption updates. Alternative investments investment income based on management's long- term expected return of approximately 10% was $558 million. $354 $558 125 December 31, 2022 Adjusted net earnings of $353 million for the year ended December 31, 2022 included $202 million of investment income from alternative investments, $66 million gain from actuarial assumption updates, $20 million net, tax benefits and $13 million net, CLO redemption gains and other income and expense items. Alternative investments investment income based on management’s long-term expected return of approximately 10% was $419 million. $301 $419 115
ANE – Significant Items1 (cont.) 43F&G Investor Update | Winter 2024 1Refer to Reconciliation of net earnings (loss) to adjusted net earnings attributable to common shareholders on page 41 ($ and shares in table in millions) Significant Income and Expense Items (Reflected in Adjusted Net Earnings) Alternatives Long-term Expected Return (Not Reflected in Adjusted Net Earnings) Weighted Average Diluted Shares Outstanding Three months ended December 31, 2024 Adjusted net earnings of $143 million for the three months ended December 31, 2024 included $138 million of investment income from alternative investments, $15 million of CLO redemptions and bond prepay income and $7 million of actuarial model refinements and other items. Alternative investments investment income based on management’s long-term expected return of approximately 10% was $170 million. $160 $170 131 September 30, 2024 Adjusted net earnings of $156 million for the three months ended September 30, 2024 included $131 million of investment income from alternative investments, $21 million of CLO redemptions and bond prepay income, and $14 million tax valuation allowance, partially offset by $17 million of net expense from actuarial assumption updates. Alternative investments investment income based on management’s long-term expected return of approximately 10% was $172 million. $149 $172 131 June 30, 2024 Adjusted net earnings of $139 million for the three months ended June 30, 2024 included $145 million of investment income from alternative investments and $4M of CLO redemptions and bond prepay income, partially offset by $16M of actuarial model updates and refinements. Alternative investments investment income based on management’s long-term expected return of approximately 10% was $165 million. $133 $165 131 March 31, 2024 Adjusted net earnings of $108 million for the three months ended March 31, 2024 included $100 million of investment income from alternative investments and $6M income of CLO redemption gains and bond prepay income. Alternative investments investment income based on management’s long-term expected return of approximately 10% was $152 million. $106 $152 130 December 31, 2023 Adjusted net earnings of $75 million for the three months ended December 31, 2023 included $110 million of investment income from alternative investments, partially offset by $10 million of one-time fixed asset impairment charge and $9 million actuarial industry assumption updates. Alternative invesments investment income based on management's long-term expected return of approximately 10% was $147 million. $91 $147 125
Non-GAAP Measures and Definitions 44F&G Investor Update | Winter 2024 The following represents the definitions of non-GAAP measures used by F&G Adjusted Net Earnings attributable to common shareholders Adjusted net earnings attributable to common shareholders is a non-GAAP economic measure we use to evaluate financial performance each period. Adjusted net earnings attributable to common shareholders is calculated by adjusting net earnings (loss) attributable to common shareholders to eliminate: (i) Recognized (gains) and losses, net: the impact of net investment gains/losses, including changes in allowance for expected credit losses and other than temporary impairment (“OTTI”) losses, recognized in operations; and the effects of changes in fair value of the reinsurance related embedded derivative and other derivatives, including interest rate swaps and forwards; (ii) Market related liability adjustments: the impacts related to changes in the fair value, including both realized and unrealized gains and losses, of index product related derivatives and embedded derivatives, net of hedging cost; the impact of initial pension risk transfer deferred profit liability losses, including amortization from previously deferred pension risk transfer deferred profit liability losses; and the changes in the fair value of market risk benefits by deferring current period changes and amortizing that amount over the life of the market risk benefit; (iii) Purchase price amortization: the impacts related to the amortization of certain intangibles (internally developed software, trademarks and value of distribution asset and the change in fair value of liabilities recognized as a result of acquisition activities); (iv) Transaction costs: the impacts related to acquisition, integration and merger related items; (v) Other and “non-recurring,” “infrequent” or “unusual items”: Other adjustments include removing any charges associated with U.S. guaranty fund assessments as these charges neither relate to the ordinary course of the Company’s business nor reflect the Company’s underlying business performance, but result from external situations not controlled by the Company. Further, Management excludes certain items determined to be “non-recurring,” “infrequent” or “unusual” from adjusted net earnings when incurred if it is determined these expenses are not a reflection of the core business and when the nature of the item is such that it is not reasonably likely to recur within two years and/or there was not a similar item in the preceding two years; (vi) Non-controlling interest on non-GAAP adjustments: the portion of the non-GAAP adjustments attributable to the equity interest of entities that F&G does not wholly own; and (vii) Income taxes: the income tax impact related to the above-mentioned adjustments is measured using an effective tax rate, as appropriate by tax jurisdiction. While these adjustments are an integral part of the overall performance of F&G, market conditions and/or the non-operating nature of these items can overshadow the underlying performance of the core business. Accordingly, management considers this to be a useful measure internally and to investors and analysts in analyzing the trends of our operations. Adjusted net earnings should not be used as a substitute for net earnings (loss). However, we believe the adjustments made to net earnings (loss) in order to derive adjusted net earnings provide an understanding of our overall results of operations.
Non-GAAP Measures and Definitions (cont.) 45F&G Investor Update | Winter 2024 Adjusted Net Earnings attributable to common shareholders per Diluted Share Adjusted net earnings attributable to common shareholders per diluted share is calculated as adjusted net earnings plus preferred stock dividend (if the preferred stock has created dilution). This sum is then divided by the adjusted weighted-average diluted shares outstanding. Management considers this non-GAAP financial measure to be useful internally and for investors and analysts to assess the level of return driven by the Company that is available to common shareholders. Adjusted Return on Assets attributable to Common Shareholders Adjusted return on assets attributable to common shareholders is calculated by dividing year-to-date annualized adjusted net earnings attributable to common shareholders by year-to-date AAUM. Return on assets is comprised of net investment income, less cost of funds, flow reinsurance fee income, owned distribution margin and less expenses (including operating expenses, interest expense and income taxes) consistent with our adjusted net earnings definition and related adjustments. Cost of funds includes liability costs related to cost of crediting as well as other liability costs. Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing financial performance and profitability earned on AAUM. Adjusted Return on Average Common Shareholder Equity, excluding AOCI Adjusted return on average common shareholder equity is calculated by dividing the rolling four quarters adjusted net earnings attributable to common shareholders, by total average F&G equity attributable to common shareholders, excluding AOCI. Average equity attributable to common shareholders, excluding AOCI for the twelve month rolling period is the average of 5 points throughout the period. Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale investments, changes in instrument-specific credit risk for market risk benefits and discount rate assumption changes for the future policy benefits, management considers this non-GAAP financial measure to be a useful internally and for investors and analysts to assess the level return driven by the Company's adjusted earnings.
Non-GAAP Measures and Definitions (cont.) 46F&G Investor Update | Winter 2024 Adjusted Weighted Average Diluted Shares Outstanding Adjusted weighted average diluted shares outstanding is the same as weighted average diluted shares outstanding except for periods in which our preferred stocks are calculated to be dilutive to either net earnings attributable to common shareholders or adjusted net earnings attributable to common shareholders, but not both, or there is a net earnings loss attributable to common shareholders on a GAAP basis, but positive adjusted net earnings attributable to common shareholders using the non-GAAP measure. The above exceptions are made to include relevant diluted shares when dilution occurs and exclude relevant diluted shares when dilution does not occur for adjusted net earnings attributable to common shareholders. Management considers this non-GAAP financial measure to be useful internally and for investors and analysts to assess the level of return driven by the Company that is available to common shareholders. Assets Under Management (AUM) AUM is comprised of the following components and is reported net of reinsurance assets ceded in accordance with GAAP: (i) total invested assets at amortized cost, excluding investments in unconsolidated affiliates, owned distribution and derivatives; (ii) investments in unconsolidated affiliates at carrying value; (iii) related party loans and investments; (iv) accrued investment income; (v) the net payable/receivable for the purchase/sale of investments; and (vi) cash and cash equivalents excluding derivative collateral at the end of the period. Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the size of our investment portfolio that is retained.
Non-GAAP Measures and Definitions (cont.) 47F&G Investor Update | Winter 2024 AUM before Flow Reinsurance AUM before Flow Reinsurance is comprised of components consistent with AUM, but also includes flow reinsured assets. Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the size of our investment portfolio including reinsured assets. Average Assets Under Management (AAUM) (Quarterly and YTD) AAUM is calculated as AUM at the beginning of the period and the end of each month in the period, divided by the total number of months in the period plus one. Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the rate of return on retained assets. Book Value per Common Share, excluding AOCI Book value per Common share, excluding AOCI is calculated as total F&G equity attributable to common shareholders divided by the total number of shares of common stock outstanding. Management considers this to be a useful measure internally and for investors and analysts to assess the capital position of the Company. Debt-to-Capital Ratio, excluding AOCI Debt-to-capitalization ratio is computed by dividing total aggregate principal amount of debt by total capitalization (total debt plus total equity, excluding AOCI). Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing its capital position. Return on Average F&G common shareholder Equity, excluding AOCI Return on average F&G common shareholder equity, excluding AOCI is calculated by dividing the rolling four quarters net earnings (loss) attributable to common shareholders, by total average F&G equity attributable to common shareholders, excluding AOCI. Average F&G equity attributable to common shareholders, excluding AOCI for the twelve month rolling period is the average of 5 points throughout the period. Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale investments, changes in instrument-specific credit risk for market risk benefits and discount rate assumption changes for the future policy benefits, management considers this non-GAAP financial measure to be useful internally and for investors and analysts to assess the level of return driven by the Company that is available to common shareholders.
Non-GAAP Measures and Definitions (cont.) 48F&G Investor Update | Winter 2024 Sales Annuity, IUL, funding agreement and non-life contingent PRT sales are not derived from any specific GAAP income statement accounts or line items and should not be viewed as a substitute for any financial measure determined in accordance with GAAP. Sales from these products are recorded as deposit liabilities (i.e., contractholder funds) within the Company's consolidated financial statements in accordance with GAAP. Life contingent PRT sales are recorded as premiums in revenues within the consolidated financial statements. Management believes that presentation of sales, as measured for management purposes, enhances the understanding of our business and helps depict longer term trends that may not be apparent in the results of operations due to the timing of sales and revenue recognition. Total Capitalization, excluding AOCI Total capitalization, excluding AOCI is based on total equity excluding the effect of AOCI and the total aggregate principal amount of debt. Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale investments, changes in instrument-specific credit risk for market risk benefits and discount rate assumption changes for the future policy benefits, management considers this non-GAAP financial measure to provide useful supplemental information internally and to investors and analysts to help assess the capital position of the Company. Total Equity, excluding AOCI Total equity, excluding AOCI is based on total equity excluding the effect of AOCI. Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale investments, changes in instrument-specific credit risk for market risk benefits and discount rate assumption changes for the future policy benefits, management considers this non-GAAP financial measure to provide useful supplemental information internally and to investors and analysts assessing the level of earned equity on total equity.
Non-GAAP Measures and Definitions (cont.) 49F&G Investor Update | Winter 2024 Total F&G Equity attributable to common shareholders, excluding AOCI Total F&G equity attributable to common shareholder, excluding AOCI is based on total F&G Annuities & Life, Inc. shareholders' equity excluding the effect of AOCI and preferred stocks, including additional paid-in-capital. Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale investments, changes in instrument-specific credit risk for market risk benefits and discount rate assumption changes for the future policy benefits, management considers this non-GAAP financial measure to be useful internally and for investors and analysts to assess the level of return driven by the Company that is available to common shareholders. Yield on AAUM Yield on AAUM is calculated by dividing annualized net investment income on an adjusted net earnings basis by AAUM. Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the level of return earned on AAUM.