Athene Holding Ltd.

Economic and Market Conditions

As a leading financial services company specializing in retirement services, we are affected by the condition of global financial markets and the economy. Price fluctuations within equity, credit, commodity and foreign exchange markets, as well as interest rates and global inflation, which may be volatile and mixed across geographies, can significantly impact the performance of our business, including, but not limited to, the valuation of investments and related income we may recognize.

Adverse economic conditions may result from domestic and global economic and political developments, including plateauing or decreasing economic growth and business activity, changes to US and foreign tariff policies, civil unrest, geopolitical tensions or military action, such as the armed conflicts in the Middle East, including with Iran, and between Ukraine and Russia, and corresponding sanctions, new or evolving legal and regulatory requirements on business investment, hiring, migration, labor supply and global supply chains and disruptions to the global energy market and supply chains.

The ongoing uncertainty regarding US trade policy, the conflict with Iran and continued inflationary pressures pose a downside risk to the current economic outlook. However, solid growth in the US has resulted in the risk of a recession remaining modest. Tariffs, which are inflationary in nature, remain in place and may have a negative impact on Gross Domestic Product (GDP) growth. The potential impact of tariffs on corporate earnings remains uncertain and will depend on the duration and outcome of related trade negotiations, as well as the legal and regulatory framework governing tariff implementation, which continues to evolve.

We carefully monitor economic and market conditions, including global inflation, that could potentially give rise to global market volatility and affect our business operations, investment portfolios and derivatives. US inflation remains elevated, with the US Bureau of Labor Statistics reporting the annual US inflation rate increased to 3.3% as of March 31, 2026, compared to 2.7% as of December 31, 2025. The US Federal Reserve has a current benchmark interest rate target range of 3.50% to 3.75%, unchanged from its December 2025 meeting.

Equity market performance declined during the first quarter of 2026. In the US, the S&P 500 Index decreased by 4.6% during the first quarter, following an increase of 2.3% during the fourth quarter of 2025. In terms of economic conditions in the US, the Bureau of Economic Analysis reported real GDP increased at an annual rate of 2.0% in the first quarter of 2026, following an increase of 0.5% in the fourth quarter of 2025. As of April 2026, the International Monetary Fund estimated the US economy will expand by 2.3% in 2026 and 2.1% in 2027. The US Bureau of Labor Statistics reported the US unemployment rate decreased to 4.3% as of March 31, 2026, compared to 4.4% as of December 31, 2025. Oil finished the first quarter of 2026 up 76.6% from the fourth quarter of 2025, primarily related to the ongoing conflict with Iran.

Foreign exchange rates can materially impact the valuations of our investments and liabilities that are denominated in currencies other than the US dollar. Strong foreign demand for US assets remains an important support for the US dollar. The US dollar strengthened in the first quarter of 2026 compared to the euro and Japanese yen. Relative to the US dollar, the euro depreciated 1.6% in the first quarter of 2026, after appreciating 0.1% in the fourth quarter of 2025. Relative to the US dollar, the Japanese yen depreciated 1.3% in the first quarter of 2026, after depreciating 5.6% in the fourth quarter of 2025. We generally undertake hedging activities to eliminate or mitigate foreign exchange currency risk.

Interest Rate Environment

Medium and long-term rates increased during the first quarter of 2026, with the US 10-year Treasury yield at 4.30% as of March 31, 2026 compared to 4.18% as of December 31, 2025. Short-term rates increased during the first quarter of 2026 with the 3-month secured overnight financing rate at 3.68% as of March 31, 2026, compared to 3.65% as of December 31, 2025.

Our investment portfolio predominantly consists of fixed maturity investments. See– Investment Portfolio. If prevailing interest rates were to rise, we believe the yield on our new investment purchases may also rise and our investment income from floating rate investments would increase, while the value of our existing investments may decline. If prevailing interest rates were to decline significantly, the yield on our new investment purchases may decline and our investment income from floating rate investments would decrease, while the value of our existing investments may increase.

We address interest rate risk through managing the duration of the liabilities we source with assets we acquire through asset liability management (ALM) modeling. As part of our investment strategy, we purchase floating rate investments, which we expect would perform well in a rising interest rate environment and which we expect would underperform in a declining rate environment. We manage our interest rate risk in a declining rate environment through hedging activity or the issuance of additional floating rate liabilities to lower our overall net floating rate position. As of March 31, 2026, our net invested asset portfolio included $53.1 billion of floating rate investments, or 18% of our net invested assets, and our net reserve liabilities included $49.8 billion of floating rate liabilities at notional, or 17% of our net invested assets, resulting in $3.3 billion of net floating rate assets, or 1% of our net invested assets.

If prevailing interest rates were to rise, we believe our products would be more attractive to consumers and our sales would likely increase. If prevailing interest rates were to decline, it is likely that our products would be less attractive to consumers and our sales would likely decrease. In periods of prolonged low interest rates, the net investment spread may be negatively impacted by reduced investment income to the extent we are unable to adequately reduce policyholder crediting rates due to policyholder guarantees in the form of minimum crediting rates or otherwise due to market conditions. Our policyholder and institutional balances include deferred annuities, indexed annuities, funding agreements and other investment-type contracts, the latter of which comprises immediate annuities without significant mortality risk (which include pension group annuities and structured settlements without life contingencies), guaranteed investment contracts, and assumed endowments without significant mortality risks. A significant majority of our deferred annuity products have crediting rates that we may reset annually upon renewal, following the expiration of the current guaranteed period. While we have the contractual ability to lower these crediting rates to the guaranteed minimum levels at renewal, our willingness to do so may be limited by competitive pressures. See Note 7 – Long-duration Contracts to the condensed consolidated financial statements for our deferred and indexed annuity policyholder account balances by range of guaranteed minimum crediting rates and the related distance to those respective guaranteed minimums. Our funding agreements and other investment-type products provide us with little to no discretionary ability to change the rates of interest that determine the amounts payable to the respective policyholder or institution.

See Part I—Item 3. Quantitative and Qualitative Disclosures About Market Risk in this report and Part II—Item 7A. Quantitative and Qualitative Disclosures About Market Risk in our 2025 Annual Report, which include a discussion regarding interest rate and other significant risks and our strategies for managing these risks.

Demographics

Over the next four decades, the retirement-age population is expected to experience unprecedented growth. Technological advances and improvements in healthcare are projected to continue to contribute to increasing average life expectancy, and aging individuals must be prepared to fund retirement periods that will last longer than ever before. Further, many working households in the US do not have adequate retirement savings. As a tool for addressing the unmet need for retirement planning, we believe that many Americans have begun to look to tax-efficient savings products with low-risk or guaranteed return features and potential equity market upside. Our tax-efficient savings products are well positioned to meet this increasing customer demand.

Competition

We operate in highly competitive markets. We face a variety of large and small industry participants, including diversified financial institutions, insurance and reinsurance companies and private equity firms. These companies compete in one form or another for the growing pool of retirement assets driven by a number of external factors such as the continued aging of the population and the reduction in safety nets provided by governments and private employers. In the markets in which we operate, scale and the ability to provide value-added services and build long- term relationships are important factors to compete effectively. We believe that our leading presence in the retirement market, diverse range of capabilities and broad distribution network uniquely position us to effectively serve consumers’ increasing demand for retirement solutions, particularly in the fixed annuity market.

According to the Life Insurance and Market Research Association (LIMRA), total annuity market sales in the US were $464.5 billion for the year ended December 31, 2025, a 6.8% increase from the same time period in 2024. In the total annuity market, for the year ended December 31, 2025 (the most recent period for which specific market share data is available), we were the largest provider of annuities based on sales of $34.2 billion, translating to a 7.4% market share. For the year ended December 31, 2024, we were the largest provider of annuities based on sales of $36.0 billion, translating to an 8.3% market share.

According to LIMRA, total fixed annuity market sales in the US were $321.9 billion for the year ended December 31, 2025, a 3.8% increase from the same time period in 2024. In the total fixed annuity market, for the year ended December 31, 2025 (the most recent period for which specific market share data is available), we were the largest provider of fixed annuities based on sales of $32.8 billion, translating to a 10.2% market share. For the year ended December 31, 2024, we were the largest provider of fixed annuities based on sales of $34.8 billion, translating to an 11.4% market share.

According to LIMRA, FIA market sales in the US were $127.9 billion for the year ended December 31, 2025, a 0.8% increase from the same time period in 2024. For the year ended December 31, 2025 (the most recent period for which specific market share data is available), we were the largest provider of FIAs based on sales of $15.0 billion, translating to an 11.7% market share. For the year ended December 31, 2024, we were the largest provider of FIAs based on sales of $13.6 billion, translating to a 10.7% market share.

According to LIMRA, RILA market sales in the US were $79.5 billion for the year ended December 31, 2025, a 20.2% increase from the same time period in 2024. For the year ended December 31, 2025 (the most recent period for which specific market share data is available), we were the fourteenth largest provider of RILAs based on sales of $1.4 billion, translating to a 1.8% market share. For the year ended December 31, 2024, we were the twelfth largest provider of RILAs based on sales of $1.2 billion, translating to a 1.8% market share. We believe RILAs represent a significant growth opportunity for Athene.