PEMBROKE, Bermuda--(EON: Enhanced Online News)--Athene Holding Ltd. (“Athene Holding,” and together with its subsidiaries, “Athene”) is providing information regarding its capital resources prior to and pro-forma for the completion of its acquisition of Aviva USA. On June 30, 2013, Athene’s consolidated shareholders equity as reported under U.S. generally accepted accounting principles (“GAAP”) was approximately $1.9 billion excluding accumulated other comprehensive income (“AOCI”) and approximately $2.1 billion including AOCI. Athene’s statutory capital resources, as described below, were approximately $2.2 billion on June 30, 2013.
On and around October 2, 2013, Athene completed its acquisition of Aviva USA, the sale of Aviva USA’s life insurance operations and a reorganization to incorporate the acquired and retained business within its corporate structure. In connection with the preparation of its full year financial results for the fiscal year ending December 31, 2013, Athene will determine and record the effects of the Aviva transactions in accordance with its various financial reporting requirements. Athene currently estimates that its statutory capital resources (as defined below) as of September 30, 2013, pro-forma for the Aviva transactions, will be between US $4.0 and $4.4 billion. This estimate is preliminary and is subject to change based on a number of factors, including but not limited to the final determination of the capital and surplus of Athene and Aviva USA’s insurance subsidiaries on September 30, 2013.
At this time Athene is unable to provide an estimated range of the potential impact of the Aviva transactions on its consolidated GAAP shareholders’ equity. The accounting for acquisitions of annuity insurance operations under GAAP is complex and incorporates a wide variety of inputs, some of which are not yet available to Athene. As a result, Athene’s current expectations may change as additional information becomes available. Nonetheless, at the current time, Athene believes any pro-forma increase in its GAAP shareholders' equity as a result of the Aviva transactions versus its June 30, 2013 balances will be limited relative to the statutory impact and will be driven by third quarter earnings and a minor bargain purchase gain, if any.
The impact of the Aviva transactions on statutory capital resources is expected to be significantly larger than the increase in GAAP equity. A similar result, on a much smaller scale, occurred in connection with a prior acquisition and partially explains the difference between statutory capital resources and GAAP shareholders' equity as of June 30, 2013.
Athene currently expects to provide information on its third quarter results in conjunction with AP Alternative Assets, L.P.’s (“AAA”) quarterly conference call on November 7, 2013 (the details of which will be provided by AAA in a separate press release). Athene does not expect to provide any further information on the pro-forma effect of the Aviva transactions on its capital resources until it has completed the analyses described above, which may not be definitively concluded until the completion and release of its year-end financial results for the year ended December 31, 2013 during the first quarter of 2014.
Statutory capital is calculated using materially different accounting principles than capital calculated in accordance with GAAP. The metric of total statutory capital resources provided above is the sum of the capital and surplus of Athene Annuity & Life Assurance Company, which, both before and after the acquisition of Aviva USA, is the parent company of all of Athene’s U.S. life insurance subsidiaries and the capital and surplus of Athene Life Re Ltd. which is Athene’s only material Bermuda insurance subsidiary; each component is based on the distinct rules and basis of accounting prescribed by U.S. and Bermuda insurance regulators respectively and the sum does not include non-insurance assets or liabilities of Athene Holding and its non-insurance subsidiaries. The GAAP shareholders’ equity reported is the shareholders’ equity of Athene Holding and its consolidated subsidiaries. The June 30, 2013 results are actual and the September 30, 2013 estimated pro-forma range incorporates estimates of expected third quarter results and estimates of the pro-forma effects of the Aviva transactions. All June 30, 2013 amounts provided in this press release are unaudited.
About Athene Holding Ltd.
Athene Holding, through its subsidiaries, is a leading provider of products in the retirement savings market. Athene’s principal subsidiaries include Athene Annuity & Life Assurance Company and Athene Life Insurance Company, Delaware-domiciled insurance companies, Aviva Life & Annuity Company, an Iowa-domiciled insurance company, Athene Annuity & Life Assurance Company of New York and Aviva Life and Annuity Company of New York, New York domiciled insurance companies, and Athene Life Re Ltd., a Bermuda-domiciled reinsurer.
Athene Holding provides investment solutions, including tax-efficient savings products, to support retirees as well as those saving for retirement. The products offered by Athene include:
- Retail fixed and equity indexed annuity products
- Institutional products, such as funding agreements
- Co-insurance and reinsurance arrangements with third party life insurance and annuity providers
Further information about our companies can be found at www.athene.bm.