Voya Financial Inc
For the period ended Jun 30, 2024. Filed Aug 1, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 1, 2024
VOYA$99.01+0.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-06.
0001535929-24-000050
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-01.
0001535929-24-000083
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 285 previous paragraphs and 386 current paragraphs.
205 unchanged; 45 reworded; 118 added; 31 removed; 4 previous and 18 current paragraphs rearranged.
Tables are not compared: 38 previous and 38 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (118)
Current report
Total revenues increased $162 million from $1,871 million to $2,033 million. The following items contributed to the overall increase.
Current report
Fee income increased $43 million from $474 million to $517 million primarily due to:
Current report
•higher fee income in Wealth Solutions primarily driven by higher average equity markets; and
Current report
Premiums increased $113 million from $677 million to $790 million primarily due to:
Current report
•lower amortization of the deferred profit liability associated with Businesses exited primarily due to higher than expected terminations in the current period.
Current report
Net gains (losses) improved $52 million from a loss of $56 million to a loss of $4 million primarily due to:
Current report
•losses on bond sales in the prior period; and
Current report
•higher impairments in the prior period.
Current report
•net unfavorable changes in derivative valuations due to interest rate movements.
Current report
Other revenue increased $12 million from $86 million to $98 million primarily due to:
Current report
•the absence of transition services agreements revenue recognized in the prior period associated with the Individual Life transaction.
Current report
Income (loss) related to consolidated investment entities decreased $31 million from $145 million to $114 million primarily due to:
Current report
•an asset sale within one limited partnership fund during the prior year.
Current report
•equity market impacts to limited partnership valuations; and
Current report
•an increase in interest income in collateralized loan obligations primarily due to a new fund launch.
Current report
Total benefits and expenses increased $149 million from $1,608 million to $1,757 million. The following items contributed to the overall increase.
Current report
•an inception-to-date adjustment recorded in the prior period to interest accretion on the deposit asset associated with Businesses exited due to higher than projected surrenders experience;
Current report
•a more favorable change in market risk benefit remeasurement recognized in the prior period primarily due to greater positive equity market performance; and
Current report
•a litigation reserve recorded in the prior period within Businesses exited; and
Current report
•higher amortization of the cost of reinsurance liability associated with Businesses exited primarily due to increased lapses on post-level term products in the current period.
Current report
Operating expenses decreased $18 million from $770 million to $752 million primarily due to:
Current report
•the absence of an impairment recorded in the prior period related to a vacated leased building;
Current report
•lower integration costs associated with the AllianzGI and Benefitfocus businesses; and
Current report
•the absence of costs incurred in the prior period which supported the remaining transition services agreements related to the Individual Life Transaction.
Current report
•an increase in expenses driven by growth and investments in our operating segments, partially offset by expense save actions.
Current report
Interest expense decreased $9 million from $39 million to $30 million primarily due to:
Current report
•a loss on debt extinguishment incurred in the prior period; and
Current report
•an increase in interest costs of limited partnerships due to a larger loan; and
Current report
Income Tax Expense
Current report
Income tax expense increased $13 million from $28 million to $41 million primarily due to:
Current report
•a decrease in noncontrolling interest.
Current report
•losses on bond sales incurred in the prior period;
Current report
•higher impairments recorded in the prior period.
Current report
The change was partially offset by:
Current report
•a more favorable change in market risk benefit remeasurement recognized in the prior period primarily due to greater positive equity market performance.
Current report
Income (loss) related to businesses exited or to be exited through reinsurance or divestment decreased $16 million from a loss of $21 million to a loss of $37 million primarily due to:
Current report
•an inception-to-date adjustment recorded in the prior period to interest accretion on the deposit asset due to higher than projected surrenders experience;
Current report
•lower amortization of the deferred profit liability primarily due to higher than expected terminations in the current period; and
Current report
•a more favorable change in market risk benefit remeasurement recognized in the prior period primarily due to greater positive equity market performance.
Current report
The change was partially offset by:
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Removed paragraphs (31)
Previous report
Total revenues increased $216 million from $1,835 million to $2,051 million. The following items contributed to the overall increase.
Previous report
The decrease was partially offset by:
Previous report
Fee income increased $49 million from $464 million to $513 million primarily due to:
Previous report
•higher fee income in Wealth Solutions primarily driven by market appreciation and business growth; and
Previous report
Premiums increased $115 million from $685 million to $800 million primarily due to:
Previous report
Net gains (losses) changed $59 million from a loss of $16 million to a gain of $43 million primarily due to:
Previous report
•an unfavorable change in mark-to-market adjustments on securities subject to fair value option accounting primarily due to interest rate movements.
Previous report
Other revenue increased $10 million from $78 million to $88 million primarily due to:
Previous report
Total benefits and expenses increased $70 million from $1,694 million to $1,764 million. The following items contributed to the overall increase.
Previous report
•favorable market risk benefit remeasurements primarily due to positive equity market returns; and
Previous report
Operating expenses decreased $37 million from $836 million to $799 million primarily due to:
Previous report
•lower integration costs associated with the AllianzGI business; and
Previous report
•lower expenses due to expense reduction actions.
Previous report
•an increase in Health Solutions expenses primarily driven by business growth and timing of the acquisition of Benefitfocus in the prior period.
Previous report
Income Tax Expense (Benefit)
Previous report
Income tax expense (benefit) changed $13 million from an expense of $12 million to a benefit of $1 million primarily due to:
Previous report
•favorable market risk benefit remeasurements primarily due to positive equity market returns.
Previous report
•an unfavorable change in mark-to-market adjustments on securities subject to fair value option accounting primarily due to interest rate movements.
Previous report
(1) For the first quarter of 2024, recurring deposits exclude certain participants’ last paycheck contribution due to the last weekday of the quarter falling on a holiday. These deposits will be recognized in the second quarter of 2024.
Previous report
•higher net investment income primarily due to higher alternative investment income and income on cash, partially offset by lower spread-based assets due to participant surrenders and fund transfer activities.
Previous report
Adjusted Operating earnings before income taxes decreased $35 million from $94 million to $59 million primarily due to:
Previous report
The decrease was partially offset by:
Previous report
Adjusted operating earnings before income taxes including Allianz noncontrolling interest increased $11 million from $42 million to $53 million primarily due to:
Previous report
•higher fee income primarily due to market appreciation and Retail net inflows, partially offset by Institutional net outflows and higher interest rates; and
Previous report
•lower operating expenses primarily due to expense reduction actions.
Previous report
On April 23, 2024, the Board of Directors provided an additional share repurchase authorization of $500 million. This share repurchase authorization expires on June 30, 2025 (unless extended) and does not obligate the Company to purchase any shares. The authorization for the share repurchase program may be terminated, increased or decreased by the Company's Board of Directors at any time.
Previous report
Department of Labor ("DOL") Retirement Security Rule
Previous report
On April 23, 2024, the DOL released the Retirement Security Rule defining who is an investment advice fiduciary for purposes of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”). The DOL also released final amendments to class prohibited transaction exemptions (PTEs) available to investment advice fiduciaries, including PTE 2020-02 and PTE 84-24.
Previous report
The effective date for the Retirement Security Rule and amendments to the PTEs is expected to be on or around September 23, 2024. There is a one (1) year transition rule applicable to certain conditions contained in the PTE amendments. The new definition of an investment advice fiduciary expands the definition of who the DOL considers a fiduciary under ERISA. Voya is continuing to study the effect the Retirement Security Rule and amendments may have on its Wealth Solutions business and operations but currently anticipates that such effects will not be significant. Voya’s current in-plan investment advisory services program, which is designed to comply with previous DOL guidance, remains unchanged.
Previous report
Qualified Professional Asset Manager ("QPAM") Exemption Updates
Previous report
In April 2024, the DOL published changes to class prohibited transaction exemption 84-14 (the “QPAM Exemption”). As a result of these changes, we will be required to notify the DOL prior to relying on the QPAM Exemption, in addition to satisfying new minimum qualification and recordkeeping requirements.
Reworded paragraphs (45)
Previous wording
The following discussion and analysis presents a review of our consolidated results of operations for the three months ended March 31, 2024 and 2023 and financial condition as of March 31, 2024 and December 31, 2023. This item should be read in its entirety and in conjunction with the Condensed Consolidated Financial Statements and related notes contained in Part I, Item 1. of this Quarterly Report on Form 10-Q, as well as Management’s Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") section contained in our Annual Report on Form 10-K for the year ended December 31, 2023 ("Annual Report on Form 10-K").
Current wording
The following discussion and analysis presents a review of our consolidated results of operations for the three and six months ended June 30, 2024 and 2023 and financial condition as of June 30, 2024 and December 31, 2023. This item should be read in its entirety and in conjunction with the Condensed Consolidated Financial Statements and related notes contained in Part I, Item 1. of this Quarterly Report on Form 10-Q, as well as Management’s Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") section contained in our Annual Report on Form 10-K.
Previous wording
On August 1, 2023, we acquired all remaining equity interest in VFI SLK Global Services Private Limited previously held by SLK Software Private Limited ("SLK") and renamed the entity as Voya Global Services Private Limited ("Voya India"). Voya India was a private limited company in India formed pursuant to a joint venture agreement between us and SLK on August 1, 2019, with us and SLK holding 49% and 51% of ownership shares, respectively. The purpose of Voya India is to provide technology and business operation services to us. As a result of the acquisition, Voya India has become a wholly owned subsidiary of us and provides us with improved strategic and operational flexibility. As part of the purchase consideration, an upfront payment of approximately $53 million was made at closing. Net assets acquired as part of this transaction included goodwill of $102 million. The revenues, expenses, assets and liabilities of the business acquired are reported in Corporate.
Current wording
On August 1, 2023, we acquired all remaining equity interest in VFI SLK Global Services Private Limited previously held by SLK Software Private Limited ("SLK") and renamed the entity as Voya Global Services Private Limited ("Voya India"). Voya India was a private limited company in India formed pursuant to a joint venture agreement between us and SLK on August 1, 2019, with us and SLK holding 49% and 51% of ownership shares, respectively. The purpose of Voya India is to provide technology and business operation services to us. As a result of the acquisition, Voya India has become a wholly owned subsidiary of us and provides us with improved strategic and operational flexibility. As part of the purchase consideration, an upfront payment of approximately $53 million was made at closing. Net assets acquired as part of this transaction included goodwill of $102 million.
Previous wording
Net investment income decreased $16 million from $545 million to $529 million primarily due to:
Current wording
Net investment income decreased $27 million from $545 million to $518 million primarily due to:
Previous wording
•lower investment income on fixed maturity securities primarily due to interest rate movements and lower average volume.
Current wording
•lower investment income on fixed maturity securities primarily due to interest rate movements and lower average volume, partially offset by actions to improve the portfolio yield.
Previous wording
•higher fee income in Investment Management primarily due to market appreciation and Retail net inflows, partially offset by Institutional net outflows and higher interest rates.
Current wording
•higher fee income in Investment Management primarily due to higher average equity markets and Retail net inflows driving higher AUM, partially offset by lower Institutional AUM due to net outflows during the prior year.
Previous wording
Interest credited and other benefits to contract owners/policyholders increased $100 million from $751 million to $851 million primarily due to:
Current wording
Interest credited and other benefits to contract owners/policyholders increased $161 million from $682 million to $843 million primarily due to:
Previous wording
•higher benefits incurred in Health Solutions due to growth in in-force business and a higher loss ratio in Stop Loss.
Current wording
•an increase in benefits to policyholders in Health Solutions due to a higher total aggregate loss ratio and growth in in-force business;
Previous wording
Operating expenses related to consolidated investment entities increased $12 million from $16 million to $28 million primarily due to:
Current wording
Operating expenses related to consolidated investment entities increased $16 million from $60 million to $76 million primarily due to:
Previous wording
•increase in collateralized loan obligations interest costs primarily due to a new fund launch.
Current wording
•an increase in collateralized loan obligations interest costs primarily due to a new fund launch.
Previous wording
•an increase in income before income taxes.
Current wording
•an increase in income before income taxes; and
Previous wording
Net investment gains (losses) changed $72 million from a loss of $9 million to a gain of $63 million primarily due to:
Current wording
Net investment gains (losses) changed $58 million from a loss of $38 million to a gain of $20 million primarily due to:
Previous wording
Other adjustments to operating earnings improved $47 million from a loss of $70 million to a loss of $23 million primarily due to:
Current wording
Other adjustments to operating earnings improved $40 million from a loss of $52 million to a loss of $12 million primarily due to:
Previous wording
Adjusted operating earnings before income taxes increased $54 million from $132 million to $186 million primarily due to:
Current wording
Other revenue increased $22 million from$164 million to $186 million primarily due to:
Previous wording
•higher other revenue in Health Solutions primarily driven by timing of the Benefitfocus acquisition in the prior period; and
Current wording
•an increase in Health Solutions primarily driven by timing of the Benefitfocus acquisition in the prior period.
Previous wording
•absence of closing costs associated with the acquisition of Benefitfocus in the current period;
Current wording
•the absence of closing costs incurred in the prior period associated with the acquisition of Benefitfocus;
Previous wording
•absence of closing costs associated with the acquisition of Benefitfocus in the current period; and
Current wording
•the absence of closing costs incurred in the prior period associated with the acquisition of Benefitfocus;
Previous wording
•lower integration costs associated with the Allianz GI business.
Current wording
•lower integration costs associated with the Allianz GI and Benefitfocus businesses;
Previous wording
•higher fee income and other revenue primarily driven by market appreciation and business growth;
Current wording
•higher fee income and other revenue primarily driven by higher average equity markets;
Previous wording
•lower operating expenses primarily due to expense reduction actions, partially offset by business growth;
Current wording
•lower expenses primarily due to expense save actions, partially offset by growth and investments in our business.
Previous wording
•higher benefits to policyholders due to growth in in-force business and a higher loss ratio in Stop Loss; and
Current wording
•higher benefits to policyholders due to a higher total aggregate loss ratio and growth in in-force business; and
Previous wording
•higher operating expenses primarily driven by business growth and timing of the acquisition of Benefitfocus in the prior period, partially offset by expense reduction actions.
Current wording
•higher operating expenses primarily driven by growth and investments in our business and timing of the acquisition of Benefitfocus in the prior period, partially offset by expense save actions.
Previous wording
(1)Includes reinvested dividends on a prospective basis effective January 1, 2024, which were $0.3 billion for the first quarter of 2024.
Current wording
(1)Includes reinvested dividends on a prospective basis effective January 1, 2024.
Previous wording
•lower other revenue due to the absence of transition services agreements revenue associated with the Individual Life transaction in the current period.
Current wording
•lower other revenue due to the absence of transition services agreements revenue recognized in the prior period associated with the Individual Life transaction; and
Previous wording
Adjusted operating earnings before income taxes including Allianz noncontrolling interest improved $5 million from a loss of $69 million to a loss of $64 million primarily due to:
Current wording
Adjusted operating earnings before income taxes including Allianz noncontrolling interest improved $5 million from a loss of $123 million to a loss of $118 million primarily due to:
Previous wording
•lower operating expenses due to costs supporting the remaining transition services agreements related to the Individual Life Transaction in the prior period and lower incentive compensation in the current period; and
Current wording
•lower operating expenses due to the absence of costs incurred in the prior period which supported the remaining transition services agreements related to the Individual Life Transaction; and
Previous wording
•lower other revenue due to the absence of transition services agreements revenue in the current period.
Current wording
•lower other revenue due to the absence of transition services agreements revenue recognized in the prior period associated with the Individual Life transaction; and
Previous wording
We estimate that our excess capital (which we define as the amount of total adjusted capital in our insurance subsidiaries above our 375% RBC target, plus the amount of holding company liquidity above our $200 million target) as of March 31, 2024, was approximately $0.4 billion. As of March 31, 2024, our estimated combined RBC ratio, with adjustments for certain intercompany transactions, was 412%.
Current wording
We estimate that our excess capital (which we define as the amount of total adjusted capital in our insurance subsidiaries above our 375% RBC target, plus the amount of holding company liquidity above our $200 million target) as of June 30, 2024, was approximately $0.4 billion. As of June 30, 2024, our estimated combined RBC ratio, with adjustments for certain intercompany transactions, was 407%.
Previous wording
See the Shareholders' Equity Note in our Condensed Consolidated Financial Statements in Part I, Item 1. of this Quarterly Report on Form 10-Q for information relating to authorizationsby the Board of Directors to repurchase our shares and amounts of common stock repurchased pursuant to such authorizations during the three months ended March 31, 2024. As of March 31, 2024, our remaining repurchase capacity under the Board's prior authorization was $225 million.
Current wording
See the Shareholders' Equity Note in our Condensed Consolidated Financial Statements in Part I, Item 1. of this Quarterly Report on Form 10-Q for information relating to authorizationsby the Board of Directors to repurchase our shares and amounts of common stock repurchased pursuant to such authorizations during the six months ended June 30, 2024. As of June 30, 2024, our remaining repurchase capacity under the Board's authorization was $551 million.
Previous wording
Subsequent to March 31, 2024, we repurchased 802,725 shares pursuant to a 10b5-1 plan for an aggregate purchase price of $56 million.
Current wording
Subsequent to June 30, 2024, we repurchased 871,636 shares pursuant to a 10b5-1 plan for $63 million.
Previous wording
As of March 31, 2024, we had $393 of short-term debt borrowings outstanding consisting entirely of the current portion of long-term debt. The following table summarizes our borrowing activities for the three months ended March 31, 2024:
Current wording
As of June 30, 2024, we had $395 of short-term debt borrowings outstanding consisting entirely of the current portion of long-term debt. The following table summarizes our borrowing activities for the six months ended June 30, 2024:
Previous wording
We maintain revolving reciprocal loan agreements with a number of our life and non-life insurance subsidiaries that are used to fund short-term cash requirements that arise in the ordinary course of business. Under these agreements, either party may borrow up to the maximum allowable under the agreement for a term not more than 270 days. For life insurance subsidiaries, the amounts that either party may borrow under the agreement vary and are between 2% and 5% of the insurance subsidiary's statutory net admitted assets (excluding separate accounts) as of the previous year end depending on the state of domicile. As of March 31, 2024, the aggregate amount that may be borrowed or lent under agreements with life insurance subsidiaries was $1.2 billion. For non-life insurance subsidiaries, the maximum allowable under the agreement is based on the assets of the subsidiaries and their particular cash requirements. As of March 31, 2024, Voya Financial, Inc. had $595 million outstanding borrowings from subsidiaries and had loaned $344 million to its subsidiaries.
Current wording
We maintain revolving reciprocal loan agreements with a number of our life and non-life insurance subsidiaries that are used to fund short-term cash requirements that arise in the ordinary course of business. Under these agreements, either party may borrow up to the maximum allowable under the agreement for a term not more than 270 days. For life insurance subsidiaries, the amounts that either party may borrow under the agreement vary and are between 2% and 5% of the insurance subsidiary's statutory net admitted assets (excluding separate accounts) as of the previous year end depending on the state of domicile. As of June 30, 2024, the aggregate amount that may be borrowed or lent under agreements with life insurance subsidiaries was $1.2 billion. For non-life insurance subsidiaries, the maximum allowable under the agreement is based on the assets of the subsidiaries and their particular cash requirements. As of June 30, 2024, Voya Financial, Inc. had $510 million outstanding borrowings from subsidiaries and had loaned $385 million to its subsidiaries.
Previous wording
Our Financial Leverage Ratio, excluding AOCI, increased from 27.8% at December 31, 2023 to 28.1% at March 31, 2024. The increase was primarily due to a decrease to noncontrolling interest, partially offset by an increase to Common equity, excluding AOCI, driven by Net income available to common shareholders net of repurchases of common stock and common dividends.
Current wording
Our Financial Leverage Ratio, excluding AOCI, increased from 27.8% at December 31, 2023 to 28.0% at June 30, 2024. The increase was primarily due to a decrease to noncontrolling interest and an increase in other financial obligations, partially offset by an increase to Common equity, excluding AOCI, driven by Net income available to common shareholders net of repurchases of common stock and common dividends.
Previous wording
Revenue Service has only issued limited guidance on the CAMT, and uncertainty remains regarding the application of and potential adjustments to the CAMT. Based on this guidance, we do not expect to be subject to the CAMT for 2024.
Current wording
In August 2022, President Biden signed into law the Inflation Reduction Act of 2022, which includes a 15% corporate alternative minimum tax ("CAMT"). The CAMT is effective in taxable years beginning after December 31, 2022. The Internal Revenue Service has only issued limited guidance on the CAMT, and uncertainty remains regarding the application of and potential adjustments to the CAMT. Based on this guidance, we do not expect to be subject to the CAMT for 2024.
Previous wording
Investments for our general account are primarily managed by our wholly owned asset manager, Voya Investment Management LLC, pursuant to investment advisory agreements with affiliates. In addition, our internal treasury group manages our holding company liquidity investments, primarily money market funds.
Current wording
Investments for our general account are primarily managed by our wholly owned asset manager, Voya Investment Management LLC, pursuant to investment advisory agreements with affiliates. In addition, our internal treasury group manages our holding company liquidity investments, primarily money market funds. See Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7. of our Annual Report on Form 10-K for information on our investment strategy.
Previous wording
As of March 31, 2024 and December 31, 2023, we held seven and six fixed maturities with unrealized capital loss in excess of $10 million, respectively. As of March 31, 2024 and December 31, 2023, the unrealized capital losses on these fixed maturities equaled $80 million or 2.9% and $70 million or 2.6% of the total unrealized losses, respectively.
Current wording
As of June 30, 2024 and December 31, 2023, we held seven and six fixed maturities with unrealized capital loss in excess of $10 million, respectively. As of June 30, 2024 and December 31, 2023, the unrealized capital losses on these fixed maturities equaled $86 million or 2.9% and $70 million or 2.6% of the total unrealized losses, respectively.
Previous wording
As of March 31, 2024, we held $2.0 billion of energy sector fixed maturity securities, constituting 7.3% of the total fixed maturities portfolio, with gross unrealized capital losses of $109 million, including zero energy sector fixed maturity security with unrealized capital losses in excess of $10 million. As of March 31, 2024, our fixed maturity exposure to the energy sector is comprised of 92.2% investment grade securities.
Current wording
As of June 30, 2024, we held $2.0 billion of energy sector fixed maturity securities, constituting 7.1% of the total fixed maturities portfolio, with gross unrealized capital losses of $118 million, including zero energy sector fixed maturity security with unrealized capital losses in excess of $10 million. As of June 30, 2024, our fixed maturity exposure to the energy sector is comprised of 91.1% investment grade securities.
Previous wording
During the three months ended March 31, 2024, the market value of our CMO-B securities portfolio was lower on a combination of transactional activity and valuation movements among tranche types.
Current wording
During the six months ended June 30, 2024, the market value of our CMO-B securities portfolio was lower on a combination of transactional activity and valuation movements among tranche types.
Previous wording
As of March 31, 2024, 82.0% and 14.1% of CMBS investments were designated as NAIC-1 and NAIC-2, respectively. As of December 31, 2023, 82.4% and 13.8% of CMBS investments were designated as NAIC-1 and NAIC-2, respectively.
Current wording
As of June 30, 2024, 81.8% and 14.1% of CMBS investments were designated as NAIC-1 and NAIC-2, respectively. As of December 31, 2023, 82.4% and 13.8% of CMBS investments were designated as NAIC-1 and NAIC-2, respectively.
Previous wording
As of March 31, 2024, 87.4% and 10.9% of Other ABS investments were designated as NAIC-1 and NAIC-2, respectively. As of December 31, 2023, 86.7% and 11.6% of Other ABS investments were designated as NAIC-1 and NAIC-2, respectively.
Current wording
As of June 30, 2024, 87.8% and 10.4% of Other ABS investments were designated as NAIC-1 and NAIC-2, respectively. As of December 31, 2023, 86.7% and 11.6% of Other ABS investments were designated as NAIC-1 and NAIC-2, respectively.
Previous wording
As of March 31, 2024, our mortgage loans on real estate portfolio had a weighted average DSC of 1.94 times and a weighted average LTV ratio of 44.6%. As of December 31, 2023, our mortgage loans on real estate portfolio had a weighted average DSC of 1.94 times, and a weighted average LTV ratio of 45.0%. See the Investments (excluding Consolidated Investment Entities) Note to our Condensed Consolidated Financial Statements in Part I, Item 1. of this Quarterly Report on Form 10-Q for further information on mortgage loans on real estate.
Current wording
As of June 30, 2024, our mortgage loans on real estate portfolio had a weighted average DSC of 1.98 times and a weighted average LTV ratio of 43.8%. As of December 31, 2023, our mortgage loans on real estate portfolio had a weighted average DSC of 1.94 times, and a weighted average LTV ratio of 45.0%. See the Investments (excluding Consolidated Investment Entities) Note to our Condensed Consolidated Financial Statements in Part I, Item 1. of this Quarterly Report on Form 10-Q for further information on mortgage loans on real estate.
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•a favorable change in mark-to-market adjustments on securities subject to fair value option accounting primarily due to interest rate movements;
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•lower interest expense driven by cumulative debt extinguishments.
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Adjustments from Income (Loss) before Income Taxes to Adjusted Operating Earnings (Loss) before Income Taxes
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•a favorable change in mark-to-market adjustments on securities subject to fair value option accounting primarily due to interest rate movements;
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•lower investment income on fixed maturity securities primarily due to interest rate movements and lower average volume, partially offset by actions to improve the portfolio yield.
Current report — wording carried from elsewhere
•higher premiums in Health Solutions driven by growth across all blocks of business.
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•an increase in other interest income due to float; and
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Interest credited and other benefits to contract owners/policyholders increased $261 million from $1,433 million to $1,694 million primarily due to:
Current report — wording carried from elsewhere
•lower interest credited in Wealth Solutions primarily due to lower spread-based assets, partially offset by a higher crediting rate;
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•an increase in collateralized loan obligations interest costs primarily due to a new fund launch.
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•an increase in income before income taxes; and
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For additional information on the reconciliation adjustments listed below, see the Segments Note to our Condensed Consolidated Financial Statements in Part I, Item 1. of this Quarterly Report on Form 10-Q.
Current report — wording carried from elsewhere
•net favorable changes in derivative valuations due to interest rate movements;
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•a favorable change in mark-to-market adjustments on securities subject to fair value option accounting primarily due to interest rate movements; and
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•higher fee income and other revenue primarily driven by higher average equity markets;
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•lower interest credited primarily due to lower spread-based assets, partially offset by a higher crediting rate; and
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•higher premiums driven by growth across all three lines of business;
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The improvement was partially offset by:
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
In August 2022, President Biden signed into law the Inflation Reduction Act of 2022, which includes a 15% corporate alternative minimum tax ("CAMT"). The CAMT is effective in taxable years beginning after December 31, 2022. The Internal
Previous report — wording carried elsewhere
See Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7. of our Annual Report on Form 10-K for information on our investment strategy.
Previous report — wording carried elsewhere
See the Investments (excluding Consolidated Investment Entities) Note to our Condensed Consolidated Financial Statements in Part I, Item 1. of this Quarterly Report on Form 10-Q for further information on impairment.
Previous report — wording carried elsewhere
Condensed Consolidated Financial Statements in Part I, Item 1. of this Quarterly Report on Form 10-Q for details regarding the carrying amounts and classifications of these assets.