Our safe harbor statement, or I'll show you our safe harbor statement. We will have forward-looking statements in this presentation. You can find them on the slides and those presented by others here on our website at 2020.americanequity.com. Fewer comments will contain forward-looking statements, particularly related to future results, many of which we have identified in our slides. Our actual results could significantly differ due to many risks, including the risk factors in our SEC filings. You can find non-GAAP financial measures discussed today and reconciliation of non-GAAP financial measures to the most comparable GAAP measures in these slides or elsewhere on our investor relations portion of our website. We're making an audio replay available on our website shortly after today's call. There are a number of people we'd like to thank. I don't want to run through that again, unfortunately. I'm going to turn that over to, I'm gonna turn it over to Anant Bhalla. Anant is Chief Executive Officer and President of American Equity. Thanks, Steven. Thanks everyone for being here. Look forward to this time today and for us to get into AEL 2.0. Thank you to our investment partners for being here as well. While the purpose of this call today is to discuss AEL's strategy, I'd like to take a few minutes upfront and address Brookfield's recent activism with respect to the company. I'll cover two main points. The first is Mr. Shah's resignation from AEL's board. I want to make sure that the record around that is clear. Second, I'll share our perspective on our 26North partnership. Later you will hear directly from Josh. With respect to Mr. Shah's resignation from the AEL board, I'm surprised by the narrative that has been put forward by Brookfield and is circulating in some quarters of the press. The simple fact is that BAM was a strategic investor until it purchased American National. It became a competitor. BAM Re and its CEO, Mr. Shah's status as a competitor is not based on opinion, but a fact. By Mr. Shah simultaneously serving on the board of AEL, BAM Re and his involvement with AMECO created antitrust concerns with respect to the Clayton Act and issues with a board's conduct. In truth, because of the Clayton Act issue, Mr. Shah had already agreed to step down from AEL's board. BAM had identified a non-consanguineous replacement director for an orderly transition. Both our board chair and I had discussions with Brookfield's representatives in the weeks leading up to our earnings call, a pattern that we were made to believe was constructive for the relationship. In fact, Mr. Shah and I spoke at length on various topics, including the orderly transition from him to the identified new director and details of the 26North transaction over the weekend before our November 8th earnings call, just as Mr. Shah was leaving for a business trip to Brazil. Hence, his November 8th letter and Brookfield's associated public disclosure, which I first learned about live during our earnings call, actually from some of you, so thank you for that. Which made no mention of the conflict issue, were a complete surprise because it was contrary to his prior representations and even more importantly, the actual facts. I wish to point out that Brookfield's rights and responsibilities as it relates to its ownership position are clearly and fully disclosed in the investment agreement dated October 17, 2020, which is publicly filed. The change in our relationship with BAM did not occur because of anything AEL did. BAM forced the change by buying American National, and by doing so, BAM is now a direct competitor to all aspects of the AEL 2.0 strategy flywheel. It also competes with our investment management and reinsurance partners. You can come to your own conclusions about BAM's motivations, but we believe its behavior and attitude towards our 26North transaction and our AEL 2.0 strategy more generally should be viewed through this lens. On 26North, we're excited to be partnering with Josh Harris and his firm. Josh Harris is one of the world's preeminent investors, having co-founded Apollo Global Management and helped scale it to over $500 billion of assets under management across credit, private equity, insurance and hybrid investing strategies with a strong long-term performance and track record that needs no introduction. We believe that with the investment in the GP from AEL Holdco and not the insurance company, we've achieved a lot of strategic optionality and frankly, better terms for AEL by investing at an early stage, which will help us differentiate ourselves versus competition, including alternate asset managers. The transaction presented a unique opportunity to get in on the ground floor with Josh. My joining his board allows us to further drive alignment between the way the manager is built and how asset management products can be purposed to best fit insurance balance sheets and serve policyholder interests. We've done this before with our GP stake in Pretium, and you'll hear from Ted Huffman, who I'm grateful for being here, shortly about how that two-year partnership has delivered for both sides. Just reading the strategic tea leaves in the asset management business, this is about a war for talent. Our partnership with 26North is about a belief in aligning with the trends in play in the alternative asset management business, which is evolving to its own version of a 2.0 business model. The evolution is largely centered around attracting the best talent. Banks and now mega alternative managers can't provide the same opportunity to talent that they did 10-20 years ago. They're just too big for superstars to achieve the kind of personal success that was possible for the generation before them. Josh and 26North's ability to recruit world-class asset management talent is second to none. I'm not going to steal his thunder. I'll let him cover further details in the presentation that he'll provide in the second hour of this meeting, which speaks for itself. One of 26North's most significant accomplishments is the rapid pace at which it is gathering talent. Hence, we believe that we will be working with the best and the brightest, and by virtue of our seat on 26North's board, we'll be able to ensure the alignment with our investment goals at AEL, which is centered around delivering results for both our policyholders and shareholders in an aligned manner. The 26North partnership is fully consistent with our AEL 2.0 strategy. Nothing has changed with our strategy, which has been delivering value to our shareholders and policyholders for the past two years. Rest assured, the investment committee of our board reviewed the investment in a fashion consistent with our other GP stakes. We have been pleased with the market's receptivity and excitement about this new partnership and look forward to the ability to build on it in the future as attractive opportunities present themselves. That was a mouthful, but I thought that was an important way for you to address for me to address what probably was the elephant in the room. With that, we'll now get to talking about the progress we made with 2.0. AEL 2.0 is about this vision about the value of the liabilities that we produce are scarce, but they require an alignment across the different parts of our strategic flywheel. It's attracted a lot of talent that wants to be at the cutting edge of the intersection of investment management and insurance. Insurance balance sheets are one of the last remaining sources of permanent capital if you look around in the industry. A recap of the virtuous flywheel that we have on page seven, for those who are seeing this virtually. We were, are, and will remain a scale annuity origination platform. With assets north of $50 billion and an ability to originate more every year, what we have brought under AEL 2.0 is a disciplined focus to underwriting the right assets and then creating the ALM strategies which are supported by differentiated investment management. Over the next hour or two, we will walk you through how that's coming to life. Starting with that flywheel, what we have put together every component that has frankly doubled the stock. The proof is in the pudding around how the market has received and reacted to that performance. Along the way, we have executed different components of the strategy, and as we outlined in our presentation earlier this year, all those components of the strategy coming together is what makes it work. The flywheel turns faster when you take the at scale annuity origination platform, but start to deliver the differentiated investment management and reinsurance that we've done through our numerous transactions. I won't walk you through each one of these because I'm sure a lot of you are aware of them, but the points I would highlight is that at scale leading annuity origination platform, why it matters. We win in this marketplace that is getting more and more crowded for four very simple reasons. The origination machine has a history and a reputation of putting clients first. Simply as some producers said to me, "I know you're never gonna embarrass me. I could sell your products to my in-laws." That matters. That's backed with a resilient product suite that's about tax-efficient accumulation, the dignity of a paycheck for life in terms of income solutions, meaning people don't outlive their earnings, past their prime earning years, and estate planning purposes. You back that up with our number one industry rating from J.D. Power in customer service, it matters because if you don't have to stay on the phone for very long, you write more business. The ease of doing business with us is what makes producers seek us out. That has driven a diversified distribution model that was dominant in the IMO channel and will continue to be dominant in the IMO channel over the years to come, but also expand in additional channels like we've done with Eagle Life. The key for us has always been profitable product growth. Where we see others chase volume over value, we pause. We've got a dominant core that allows us to continue to be at scale. That needed the support of differentiation in investment management. You've heard me say in the past that you cannot be just buying bonds in Bloomberg with a core fixed income strategy and compete in this business anymore. In order to do that, we came up with a strategy around private assets, private assets that actually Jim will walk you through a little bit, that we believe are lower risk profile. Then a core strategy if it goes down the capital structure. We don't go down the capital structure in what we buy. We understand what we buy, you hear from our partners better than from me on how we approach those markets. We have forged numerous relationships, as you can see on page 10, in the asset management space that allows us to have access to differentiated assets, we will originate north of $5 billion of private assets this year. Jim will walk you through some more of that along with Axel. In the reinsurance space, we've done a few reinsurance transactions focused on the enforced business, and we have our own vehicles that are established both in Vermont and offshore in Bermuda that allow us now to bring the ability to bring in private capital through sidecar deals that we will be doing. All aspects of the flywheel are up and running, and we will be expanding the third and last part over there, which is accelerating the growth of annuity origination in the coming years. We have put in place the investment management capabilities we need, the reinsurance capabilities we need, and as we now scale in those areas, we're looking to expand our access to liability origination that's differentiated. It starts with the advisor loyalty that we have in our channels with proactive product repricing, but we will be expanding into the RILA space in 2024, are redoing our internal infrastructure to be able to continue to be the number one customer service company, but in a more responsive manner. Longer term, see real opportunity in being the reinsurer of choice to other insurers, as well as accessing international markets. The flywheel is resilient, it works across markets, and is spinning faster and faster as we execute the strategy. With that, I'm gonna hand over to Jim to walk us through the investment side before Axel comes on. Jim. Thank you. Oh, it's loud. Welcome, everybody. Great to see you here today. I thought I'd spend a few minutes, talking about execution of our private asset strategy, really to go through, you know, when we talk about the open architecture model, why that's important to us, what that gives us, what does it mean ultimately to the bottom line of the company. Then talk about what we've executed, what we've done to date, and what we're doing on a go-forward basis. You think about the open architecture model, you know, what it allows us to do is to actually scale up faster in private assets. If we were to try to build out platforms across all of these asset classes that we wanna invest, it would take years for us to build across the entire suite of products that we wanna buy. For us, partnering with top talent across the industry is a key part of scaling faster, leveraging top talent, and being able to access a broader range of assets than we would otherwise. What has it done for us? If you look at our private asset investments, we've doubled our investments over the past two years. We've gone from 9%- 18%. Really what matters is the bottom line. The bottom line number is even before rates and spreads give us a lot of help this year like everybody, we had the ability to stop the decline in portfolio yield that everybody was seeing due to the ultra-low rate environment, and start to turn the corner and increase yields. Now with rates and spreads helping us a lot this year, clearly it's helped, you know, everybody in terms of portfolio. We have a broader set of assets now that we can leverage and that we can buy as and when we think about relative value trade-offs across the portfolio. If we look at what we've been doing, think about this slide in a couple of different ways. One is the asset classes where we're investing, the other is the part of the capital structure where we are. We spent a lot of time in real estate. We've done investments, you know, really senior loans for a large part of it in residential real estate and commercial real estate. That commercial real estate scenario, we had a historical portfolio, but we've done some more investing there, and then agricultural real estate. That's been a lot of what we've done, but we've also started building a portfolio in middle market credit. We've done some infrastructure debt. We've done some specialty finance deals, and we've even ventured into equity in the residential and commercial real estate space, and are spending a lot of time focused on sourcing infrastructure equity deals and core private equity, as an investment class. What we're looking to have is basically access across asset classes, but up and down a capital structure too. That's the value of the open architecture system. We can scale faster, we can scale more asset classes while leveraging top talent. You'll hear from a few of them today who are kind enough to join us and talk to all of you. That's the benefit of the open architecture system and what it gives us. I'll turn it over to our CFO, Axel, to take you through some of the numbers. Thank you, Jim. Hello, everybody. Good to see you here. I thought I would take a few moments to first, let's level set on where we are. AEL 2.0, where are we in terms of our balance sheet? We built a strong foundation. We have a very strong balance sheet today. We have excess capital that we estimate at about $850 million. That's from a rating agency capital perspective at a consolidated level. According to our stress testing, following the impact of a moderate recession scenario, we would still be left with $500 million of excess capital. We have a very strong balance sheet to start with. From a financial strength rating, as you're aware, we are rated A minus across the board for our three rating agencies, AM Best, S&P, and Fitch. From a liquidity perspective, we hold ample liquidity at the holding company level, $320 million as of 9/30 of this year. Within the operating companies, we also have access to significant amount of liquidity in the form of cash and equivalents as well as access to the FHLB window for same-day liquidity effectively. Over $1.8 billion of liquidity in the operating company. From a leverage perspective, we've talked about our assets leverage. That's statutory assets to total available capital. We have the 13x leverage ratio, which is very modest, very reasonable. From a capital structure perspective, our debt to total capital ratio stands at 13.9% with ample capacity to take on more debt in a manner that's consistent with our existing rating. That's an important starting point. In the next few pages, what I wanna talk about is what does the next phase of AEL 2.0 look like, and what does the path of value realization look like over the next two to three years? We've talked a lot about this, what I wanna do today is to put all of the pieces of the puzzle together and lay it out for you so that you can see very clearly what do the next two to three years look like for AEL. There are really three main drivers of shareholder value creation that are part of our strategy. Number one is yield enhancement. Supported by both the current higher interest rate environment that we're in with new money yields that are significantly higher than where they were just a few months ago and our private asset strategy, we have and we continue to increase our investment yield on our total book of assets. In addition to increasing yield, we are also expanding margin, and that's critical to our spread-related earnings. Point number two is we have started to build, and we will further increase the fee-related earnings part of our business so that over time our mix of earnings becomes a more balanced mix between fee related, highly predictable, capital light mix of earnings and traditional spread-related earnings. Lastly, capital optimization is key to everything that we do. It's capital optimization through the use of our existing captive reinsurers that we have in Bermuda and Vermont. It's capital optimization through the reinsurance relationship that we have and through new reinsurance relationships that we will create, in particular, the establishment of sidecar vehicles where we will cede business attracting third-party capital, further optimizing the balance sheet. Let me walk you through each of those, one by one. First on yield, investment yield. First it's important to look at what we've achieved so far. Like Jim was saying, from 2020- 2022, we've already increased average yield on the total book of assets by 30 basis points. That may not seem like much, but it is certainly quite a task to turn around a $50 billion balance sheet and to pick up 30 basis points over two years. Continuing with that trend and continuing with our private assets origination, we expect that we can further expand yield and reach 4.8% and higher by 2025. Importantly, a lot of that pickup in yield is actually gonna flow to the bottom line in expansion of spread margin for spread-related earnings. If you look at our investment spread here, we've already expanded 20 basis points from 2020- 2022. Looking out to the future, we expect to pick up further expansion in margin, which will increase spread-related earnings and distributable earnings associated with that. The new money yields are also very important from a new business origination perspective. When we look at new business IRRs for legacy products in 2020, we were probably originating products at around a 10% IRR, which is very decent, very reasonable. We've been able to exceed that since then through the pickup in yield on the overall book of business. When we look at business that we originate today, we originate business at 12%-14% IRR, that's very critical because writing profitable business is critical to our business plan. It means that we can either keep the business on balance sheet for spread-related earnings that produce ultimately distributable earnings, or we can attract third-party capital that's going to invest in a sidecar vehicle and earn the profits on that business in exchange for which we will receive ceding commissions on that business. The underlying ingredient of the business has to be profitable so that a third-party investor can see that they can earn a return on their capital of course. From an asset origination perspective, Jim talked a bit about that. For 2022, we expect to be well ahead of our initial expectation of origination of $3.5 billion-$4 billion for the year, and we'll probably end the year at $5 billion or more. Looking forward, we expect that a sustainable $4 billion+ origination of private assets is feasible every year. Next piece, next key driver is the business mix. Looking back at 2020, we were a pure spread origination insurance company. Spread earnings, we kept it all in the business on balance sheet. 2022, through the establishment of the reinsurance relationships that we have with Brookfield, with 26North, we have transferred a significant balance of liabilities to those reinsurance vehicles. And through those reinsurance vehicles, we receive ceding commissions, whether they are recurring or whether they are upfront, ultimately they lead to recurring GAAP earnings. What's very important about the characteristics of those earnings, it's capital-light recurring earnings. As we evolve over time and look at the business mix over time, more and more of our earnings mix is gonna be in the form of capital light, predictable fee-related earnings, as well as traditional spread-related earnings. Looking at the top chart here, looks at the balance, so essentially the amount of liabilities, or reserves that are subject to fee, ceding commissions versus spread earnings on balance sheet. At the bottom chart, we look at the earnings mix. As you know, because of the way that GAAP accounting works for reinsurance, essentially the free cash flow conversion ratio of fee-related earnings is much higher than spread-related. Essentially it looks like a lower mix from a GAAP earnings perspective than from a balance perspective. From a distributable earnings perspective, it's actually gonna look like a higher preponderance from fee related than what is indicated on the page here. I'll show you that in a minute. Third key driver, capital optimization. The starting point of AEL 1.0 in 2020 was a very simple business, very successful, but very simple and not necessarily optimized from a capital perspective. Purely U.S. focused. No Bermudan presence, and therefore relatively some level of trapped capital essentially within the balance sheet, some level of inefficiency. The result is that historically, AEL had not really returned capital to shareholders over the years. Looking at where we are today in the middle there, we've already started to see some of the benefits of AEL 2.0 through our initial capital optimization actions. Number one, we established our Bermudan captive reinsurer. We ceded a block of business of about $4 billion there. We were able to benefit from the principles-based capital regime in Bermuda versus the factor-based capital regime in the U.S., which for the block of business that we ceded was particularly beneficial. We also talked about a year ago, about the redundant reserve refinancing that we did. We were able to restructure our living benefit reserve financing transaction and benefit from significantly better pricing terms that were available in the market, as well as release capital. Third, we have started to build a stream of fee-related earnings through the Brookfield Reinsurance relationships as well as the 26North reinsurance relationship. The capital that's been released through these transaction has been able to fund two purposes. One is the incremental capital that is associated with private asset strategies, generally speaking. Two, we have been able to initiate capital return to shareholders. As you know, we have started a significant capital return program this year to shareholders, and that is the beginning of a sustainable capital return to shareholders for the years to come. Moving forward, 2023 and beyond, looking at what we'll continue to do, we will continue to grow margin for the spread-related earnings part of the earnings mix, like I talked about before, through higher investment yield and higher spread on the business. Number two, we will build sidecar vehicles and attract third-party capital, which would enable us to further grow fee-related earnings. We will also grow fee-related earnings through simply the additional flow that goes through our existing reinsurance relationship with Brookfield on the one hand, and potentially as well, new flow with 26North. The result of all of that is sustainable capital return to shareholders. I will walk you through that in just a second. Those are the key three drivers. If we look at the balance of liabilities that results in fee-related earnings over time, here's what it looks like for AEL. Starting with essentially zero balance in 2020 to by the year-end 2021, we had the in-force transaction, reinsurance transaction with Brookfield, where we ceded about $4 billion of liabilities. As well as in that year, we had a small amount of new business flow for business originated in the third and fourth quarter of 2021 going to Brookfield. That amount of flow business ceded to Brookfield represented about 10% of our origination volume for FIAs. Now look at this year-end, 2022. With the transaction with 26North, we will end the year at about $9 billion of reinsured liabilities. When you look at the amount of flow business that we ceded, new business issued this year that we ceded to reinsurance vehicles, we ceded about $1 billion out of $3 billion, so about 30% of our business was ceded. Fast forward to the future, what we're assuming here is we, in 2023, we will execute a sidecar transaction. We are assuming that we will establish the sidecar vehicle with a $3 billion block of in-force business and then a $1 billion per year of forward flow commitment. That's what we have here in 2023, we have another one of those in 2024. We have clear line of sight to growing this reinsured liability balance to $20 billion or so by year-end 2024. That is really critical. Let me talk about what is the result of that from a distributable earnings perspective. First, let's talk about a sidecar vehicle. What are the economics of a sidecar vehicle? Here is a very illustrative and relatively stylized example of those economics, but it is nonetheless rooted in fact, rooted in our internal NICs as well as actuarial appraisals. Essentially, what we assume, like I said, is that in year one, we established a sidecar vehicle with a $3 billion block of in-force business ceded to the vehicle. In that first year, about $1 billion of new business, newly originated flow would go to the vehicle, and then $1 billion after that year for year two and year three. Quickly growing that reinsured liability balance to $6 billion by the end of year three for one sidecar vehicle. Assuming relatively conservative 5% upfront ceding commission for that business, you can see that by the end of year one, the amount of ceding commission associated with the sidecar is about $200 million. That's $150 million for the in-force block and $50 million for the flow for that first year. It's essentially $50 million of ceding commission every year for every $1 billion of flow that we cede to the vehicle. The way we think about it is we think about stacking those sidecar vehicles. We do a sidecar vehicle in 2023, we do another one in 2024, we stack those earnings streams. As you do that, you can see that two sidecar vehicles will result in $100 million of ceding commission for the flow business, and that is essentially all distributable. That is all directly distributable and results in potential capital return to shareholders. Let's now piece all of this together. For the overall stream of distributable earnings that we expect for AEL in the future. As I said, starting in 2020, essentially had no distributable earnings to that resulted in capital return to shareholders. This year, by the end of this year, we are already at about $150 million-$175 million of distributable earnings. Essentially about $100 million-$125 million from our spread-related business and $50 million from fee-related business. Today, as you know, we have about $5 billion going to Brookfield that results in a weighted average fee of about 100 basis points. That's $50 million a year right there of cash flow, free cash flow distributable to shareholders. Looking forward two years with the assumption that we execute two sidecar vehicles, one in 2023, one in 2024, we're essentially gonna be adding $100 million of distributable earnings to the fee-related side of this chart. On the spread-related side, we expect the amount of distributable earnings to remain relatively stable because while we are expanding margin, we are reducing the balance of spread-related earnings as we cede in-force business to the sidecar vehicles. We believe that this is a very credible path to constructing that sustainable recurring $250 million-$300 million capital return to shareholder going forward. To put it back all of it together, the key financial outcomes that we're looking at and that we've talked about with you in the past, a sustainable capital return to shareholders, $250 million-$300 million a year, a transformation of our earnings mix, of our business mix, which over time will result in about a third of our earnings being fee-related and two-thirds spread-related. We believe that this is, this is gonna be critical because we really believe that the capital light and predictable nature of those fee-related earnings would over time attract a higher multiple to our total mix of earnings. Whether you, the analysts look at it in a sum of the parts type valuation framework or simply as an overall P/E ratio on the total mix of earnings, we believe that an expansion of that ratio over time is a logical conclusion of what we will do. Lastly, we've talked about operating ROE in the 11%-14% range, which continues to be our target. With that, I will pass it back to our investment partners or to Anant. Thanks, Axel. Hopefully, that gave you a little bit of picture of AEL 2.0 in action and how we're going about it. The key point really around as we transition to our investment partners is around the open architecture. The open architecture of AEL allows us to actually put the policyholder first and design it for the allocation that works for the liabilities for current times. When it makes sense to lean in into real estate, which we thought with great conviction was the thing to do in early 2020, we did and formed our partnership with Pretium. I think Ted Huffman and I have had too many late-night phone calls about the opportunities in real estate, and we've executed together. Ted, thank you for that. Thank you for being a partner. We'll start with Ted walking us through the Pretium relationship and what all we've done with them. Ted? Super. Well, thank you very much, Anant. Thank you for inviting me today to be able to speak. First of all, I just wanna say that I'm stepping in for our founder and CEO. Thank you very much. Our founder and CEO, Don Mullen, who unfortunately cannot be here today because he's under the weather. I can assure you that he would wanna be here, so he's sorry he's not. I can also assure you that no one tells the Pretium story better than Don does. You're stuck with me, but I'll do my very best, and we'll go through. I really enjoy telling the Pretium story as well. Let me go fast-forward here. Super. Okay. Pretium was founded by Don 10 years ago. We now have over $50 billion of AUM across three investment strategies: single-family rental homes, residential credit, and corporate and structured credit. I'll go through those investment strategies in more detail in the next couple of slides, but what really sets Pretium apart is our operating companies, and it's in an operating company-led investment strategy, which I'm gonna talk a lot more about here in a minute. When I look at the five core elements for assets that Pretium looks to invest in, and I'll talk about residential today because that's where AEL is allocating capital for Pretium to manage for them. We look for five. If you look at residential. They're quite simple. One, they have to be large. Residential is certainly large. It's almost as big as the S&P, sometimes it's actually bigger than S&P 500. It has to be fundamental to the economy. Well, shelter's pretty fundamental. Number three, it has to experience some level of disruption so we have an attractive entry. At that point, oftentimes I'll pause and talk about the extraordinary returns that Pretium has produced. Other investment managers may wanna then enter that business because of that, 'cause the returns are so attractive. I have to remind them there's actually points four and five, and that's what really sets us apart. That is, we go after assets that are hard to source and they're difficult to manage. In residential, in particular, when you look at it, the houses on average are about $350,000 per asset. On the non-income and the mortgage origination side, they're about $500,000. We've been able to scale to $50 billion. We're only able to do that because of the operating companies that we have. That's been in our DNA from the very beginning. Truly, if I were to use just one sentence to describe Pretium, I'd say that Pretium is an operating company-enabled investment manager. That's what really distinguishes us. It's because of the nature of the asset class that we're focused on and the fact that it produces those returns are what's required to actually create those returns for our investors. In fact, when I joined Pretium eight years ago, I joined to actually help us acquire our first one. That was a mortgage origination company. It took us a little bit longer than we anticipated, but nevertheless, we eventually got there. What's unique about... we'll focus on the mortgage origination piece of it, is that what I bought into in the thesis of Pretium was by providing sponsorship, and no better time now than to see the benefits of that sponsorship. Sponsorship being provided to an origination company, giving it a stable operating capital structure, so it can produce on a consistent basis, attractive investable assets. That's the business plan, and that's why I joined. For AEL and other investors, it allows them to have that consistent flow of assets at attractive yields because of the sponsorship being provided on behalf of Pretium to the origination companies. All right, let's turn to the next slide here. Let's dig in now a little bit to some of the investment strategies specifically. Again, I'll highlight real estate and residential credit since those are the two strategies where we manage capital for AEL. Real estate is Pretium's oldest and largest business. We're now the largest owner and operator of single-family rental homes with nearly 100,000 rental homes across 30 markets. Pretium, originally, we built this out of the dislocation that was created out of the global financial crisis. In 2012, we saw an opportunity to enter in attractive level homes. The plan at the time was to rent the homes during the investment horizon and then likely sell them. We didn't fully anticipate that this was gonna turn into a real business on the SFR side. We're delighted that it happened. In fact, we weren't even initially overly focused on this operating company-enabled investment manager piece. In many ways, we kind of backed into it. We were outsourcing property management initially. Again, looking at the granular nature of the assets and the opportunity to create extraordinary returns. To do that, you had to control as many steps of the process from beginning to end to then generate those returns for the investor. That's why we then took the bold step in 2014 to actually create from scratch a national SFR property management company from coast to coast. Progress Residential now is the largest, like I said earlier, this was all designed to improve the quality and the returns of the margins for then on behalf of the investors. In fact, we're able to do that. We were able to take our NOI margins up by 20 points from the time we created Progress to where we are today. Progress is recognized as the leading property manager for SFR as we sit here today. Our next business is residential credit, where we invest in newly originated non-qualified mortgages as well as non-performing and re-performing loans. Now lots of people, investors invest in the debt of residential real estate. We believe that owning the risk directly in loan form is a far more efficient way to invest and to capture those returns from those assets. However, it does come with operational complexities. You really can't talk about the mortgage business today without acknowledging the significant dislocation affecting the industry today. What we've seen is an unprecedented increase in rates over the past nine months. With that, we've seen several originators close as volumes are down more than 50% in some origination sectors. At Pretium, like I said earlier, we manage these originators by providing them a stable operating capital structure, and many of our competitors on the origination side, they're either independent or their sponsorship comes in a different form that doesn't provide that stable operating capital structure to consistently produce the assets. In fact, we actually are excited and quite optimistic about this time we're in right now, given the fact that we have this stable operating capital structure for origination companies and think this is a phenomenal time for us to increase our market share. We're working rapidly with our two origination companies to do just that. Lastly, we have corporate and structured credit business, which the CLO issuer, investor and secondary CLO equity and debt, distressed debt and opportunistic debt and legal opportunities. On this page, I wanna dive in a little bit more on the importance of the operating companies. Like I said earlier, homes come at roughly about $300,000-$350,000 per asset. On the non-QM mortgage side, although they're a little bit larger, they're still only at about $500,000 on average. You need two things to make sense for a company like AEL to make a portfolio allocation decision. One is this consistent access to attractive yielding assets, and number two, active servicing and management of those assets. That's what our operating companies provide to us every day with the 4,200 employees that are doing that across the country. On the real estate side, Progress Residential has acquired over 20,000 in each of the past three years. They've acquired over 20,000 homes in each of the past three years. That's an opportunity to invest at scale. Because Progress manages almost 100,000 homes, it has the people and processes to maximize the performance of those homes. On the mortgage side, it's a similar story. Starting with the origination engines of Pretium and Anchor. Next year, Pretium will originate $3 billion of non-qualified mortgages, because again, we can control that production. Anchor will originate over $2 billion of fix and flip, or what I think we now call residential transition lending, and construction loans. Looking into the future, both these numbers could double as we invest in expanding the capabilities of both companies. That certainly covers the supply availability to the investors part of the equation. On the ongoing management side, we purchased at the GP, a special servicer, Selene, and they're there to ensure and work the assets to make sure the payments are coming in on time, and they're doing this in a highly regulated industry. Let me take a moment to thank Anant and everyone at AEL for their partnership. AEL, like Pretium, sees an opportunity in times of dislocation. It's because Pretium with AEL support is so well capitalized, that our operating companies are able to better navigate the challenging currents in the industry and actually convert this challenging situation into a positive for us because we have AEL as a partner, and creating a stronger company when all is said and done. One last point on the operating companies is that they are profitable. We run these as third-party companies. Each operates at market pricing within their sector and generate earnings for Pretium. AEL, as an owner of Pretium, also shares in the profitability of those companies. On the risk management side, we have another key advantage. When you control the creation of the asset, you control the parameters on which the asset is created. I mean, it's pretty straightforward, but it's a meaningful difference when you're trying to provide assets for AEL. The non-QM market was created by regulations that followed the financial crisis, and while some people analogize it to the alt-A market that existed pre-GFC, you can see the assets de-pavement creates are very different. This is a product aimed at investor and self-employed borrowers who are good credits but don't fit the GSE box because they don't have W-2 income. We lend to them at low LTVs that are well protected. The same is true over at Anchor. They work with seasoned professional real estate developers. 95% of Anchor's clients have completed more than 10 successful projects. You'll also note that Anchor uses an as-repaired loan-to-value when underwriting loans. Who else is better to determine what that as-repaired value is than the oldest institutional fix and flip lender, with over 20 years of experience, including through the GFC? The first lender in the space to exceed now $10 billion of total originations. That's Anchor, who we purchased, November of last year. You've already heard me talk about Progress, and I think the point I'd like to make here is that while each house is unique, when you manage nearly 100,000, you begin to see some similarities, much more similarities than differences. By buying newer homes and renovating them to a common standard, they can be managed and will perform in a similar fashion. I'll wrap up and just spend a little bit of time on why we have so much conviction on the U.S. housing market. It's illustrated on these three charts that we have here. Overall, the U.S. has a massive housing shortage, unfortunately. In the 10 years that followed the financial crisis, the U.S. underbuilt new housing by a staggering amount. Earlier this year, Freddie Mac said the shortfall was 4 million units. We think that grossly undershoots by a large margin. The homes we do have are getting obsolete, becoming obsolete. These stats are amazing. In 1999, the average house in the U.S. was 27 years old. Today, the average house is over 40 years old. Not only do we not have enough homes, we don't have enough of the right type of homes. Think about what 15 years does to the house. I know what's happened to my house in the last 15 years. Think about how we live and how it's changed over the last 40 years. Lastly, there's a massive generational shift going on with baby boomers as net sellers and millennials as the net buyers of homes. What we're seeing is that kids certainly do not wanna live in their grandparents' house, so they need to be renovated. The U.S. housing market needs significant private capital, and the window to invest in the sector will be measured in years, if not decades. With that, I will conclude and Mark turn it back over to you. Anant, is that all right? Thanks, Ted. Thank you. All righty. Thank you very much. Well, you saw why we, in early 2020, got into real estate in the residential space and why we see this to be a structural opportunity going forward. Similarly, middle market credit is a great opportunity, and I'm delighted to welcome Bill Sacher here from Adams Street Partners to talk to you about what we do in credit. Bill, we wouldn't be doing it with Adams Street if it wasn't for you, so I'm glad to get to hear it from you. Thank you, Anant. I appreciate that introduction. Hello, everybody. Nice to meet you. Thank you for having me. I thought we would start by telling you a little bit about Adams Street as a firm, our credit business, and what we're doing for American Equity Life, and finish up with our outlook on the market as well. Starting with the firm itself, we are a global investment manager, specializing exclusively on private markets. We currently have $52 billion of assets under management and under various ownership over the years. We've been doing this for about 50 years. In fact, just celebrated our 50th anniversary. Given that operating history and this consistent focus on private markets, we've been accumulating private equity sponsor portfolio-level information for decades. It's one of our most valuable assets, and it gives us a very important competitive advantage, especially for the private credit business, which I'll speak a little bit about in a moment. We are 100% employee-owned, which is not only a great recruiting and retention tool, but it also helps cement this culture of partnership that we use to derive really important synergies within the organization itself. You can see a little bit of that from the chart here. We operate a highly integrated and synergistic platform that is comprised of five core strategies, three of which are direct investment strategies, and two are fund-to-fund operations. If you look in the upper left-hand corner, it really starts with our primary investment team. We have about $32 billion invested with over 400 middle market private equity sponsors. Think about that as the engine for the synergy that revolves around that wheel. On the upper right-hand side, we have a long-standing secondary fund-to-fund business, essentially buying the LP interests on the secondary market. We obviously have a very significant knowledge advantage there. Being invested on the primary side, we know exactly what's going on with those portfolio companies and can instantly determine their valuation. Below secondaries, we have an equity co-invest arm. This is one of the direct strategies where we're investing directly at the portfolio company level of the private equity sponsor deals alongside the sponsor in the equity. We have a growth equity arm. This was actually the original strategy 50 years ago that Adams Street started with. It's not as synergistic with the private equity side, but it is synergistic with the venture capital investments that we make on the primary side. Last but not least, the credit business that I'm responsible for. We currently have a little bit less than $8 billion. We are a private equity sponsor-focused lending practice, leveraging the relationships that we enjoy through the primary side of the business. We approach the business... We're doing something a little differently for AEL, but we approach the business as a solutions provider. Many of the lenders tend to specialize in just senior debt or mezzanine debt or, other higher octane versions of private credit. We come at it, offering everything from the very top of the debt stack, all the way through to the junior debt, tranches. It's less about what we have to sell and more about what that private equity sponsor ultimately needs. If you look around this wheel, virtually everything we do involves providing capital to private equity sponsors, both on the fund side, through our primary and secondary group, and on the portfolio company side, from the very top of the debt stack all the way through the equity. We think it's one of the most comprehensive capital offerings to that private equity community in the world. Let me tell you a little bit about some other aspects of our approach because I think it does align well with the AEL investment philosophy as well. There are a couple of things that we like to believe differentiate us, it starts on the underwriting side. We literally come at this with the goal of building money good loans. We don't always succeed, but that's the goal, and we get very close to that ideal realization. For credit, that's what it's all about. You know what your target return is gonna be. It's embedded in the contractual elements of the deal. It's mostly the coupon. You can only underperform. That underperformance is losses. That is the goal. What that does for us, it sounds very virtuous, but what that does for us is that it allows us to produce consistent results across market cycles, across different vintage periods, across different market environments. The key and the secret sauce is minimizing losses. We target classic middle-market companies, tend to run an enterprise value from $150 million- $700 million or $800 million at the high end. These are companies of some scale. We like that from a credit standpoint. They tend to have more resilient positions in their respective markets. Even at the high end of the range, those companies are generally not large enough to have access to the liquid markets, where in most cases, the pricing, the terms, the credit protections, the credit statistics are a lot less attractive than what we can find in the private market. We want the companies of scale for credit reasons, but we don't want them so large that they have any choice but to come to the private market and have to adhere to the credit standards that exist there. The other element of the approach is that we go to market as a lead lender. By being a lead, we pick up a couple of intrinsic benefits that we think are really important. It starts on the underwriting side. We get special private side access that gives us an informational advantage that you just can't have access to unless you're a lead. That helps contribute to our goal of underwriting money good loans. It gives us influence on pricing and structure and deal terms, all the covenants and negotiate on a bilateral basis, and it provides us with incremental economics for providing that service as well. Lastly, and most importantly, is the benefit that we actually get from operating the business on the Adams Street platform. As we were saying just a slide or two ago, we're one of the world's largest private equity fund to fund managers. We have $40 billion invested in 460 middle-market private equity sponsors. We're one of the bigger institutional investors to private equity, and being an actual partner in the funds you're originating deal flow from, is a very important competitive edge that very few of the debt providers that we compete with in the market possess. It also happens to have very high barriers to entry. You know, nobody's creating another global scale fund to fund business. So, it's a very hard competitive edge to replicate. Likely to enjoy it for a long time. It doesn't really stop there. You know, that gives us a front-row seat on deal flow, probably gives us a last look on the underlying deal as well. It also provides us with an important knowledge advantage as well, because we're not just an LP, but we're an important enough LP to be invited to sit on the advisory board at the fund level. We know everything that's happening with those underlying portfolio companies. We sit on 500 of those advisory boards. The firm has had the foresight of seeing the value in that portfolio company information and has been accumulating it, in their proprietary database for decades. There are literally 20,000 middle-market private equity portfolio companies in that database. The percentage of overall annual deal volume that just simply involves one private equity sponsor selling the business to another private equity sponsor has been going up for years. It represents a material portion of that deal flow. With a relatively high degree of frequency, when a deal comes in as an opportunity to do financing for the new purchaser, that company exists in our database. We will have, in many instances, five or 10 years of historic operating performance of that underlying business, unfiltered, unadjusted, no pro forma. There isn't another lender in the market that would have that access. It's truly proprietary. I would even argue with respect to that historic insight, we know a little bit more about the business than even the buyer does. What are we doing for AEL? It's actually pretty straightforward. We've formed several management companies to invest in senior secured first lien debt, $1 first lien debt lent to middle market companies that are backed by private equity sponsors. The management companies, you know, are now comprised of these assets that I think have very attractive risk-return features to them. I'll get into that specifically. You'll see what I mean in a moment. Management company investments are also intended to be securitized. As the portfolios are built, we'll securitize those underlying assets and be able to craft them in a way that represents the majority of the portfolio in investment-grade debt that is very capital efficient for the insurance company general account. Then we do share and the economics and have an alignment and, you know, mutually benefit from building that part of our business. Having that additional capital makes us a stronger competitor in the market because we could speak for more of the underlying financings. We've been operating this as I think you saw on one of the early slides for close to two years now. I have to say that from Adams Street's perspective, it's worked out even better than we had hoped. In addition to generating these capital-efficient assets for the general account, the philosophy with which we approach it, this money, good loan goal, really lines up well with the AEL culture of investing and has resulted in what's turned out for us to be a very effective and productive working relationship. I'm gonna finish up with market outlook. I will start by saying we are very cautious on the economic outlook. We think the risk of recession is high and growing. This is not a time to be complacent about that risk. As a result, we've tightened our filter. We're becoming more selective, and building the portfolio more defensively, trying to cherry-pick deals that involve companies that we believe will operate reasonably well in both an inflationary and recessionary environment. That said, we have a saying in the business, some of the best loans are made in the worst of times. We are in one of those times and maybe even at the threshold of what could turn out to be a fairly long-term, very attractive, vintage period for private credit. What tends to happen in those market environments, and we're seeing it now, is that markets get disrupted, competitors begin to subside, the balance of negotiating power begins to shift in favor of the lender from the borrower, and those are the reasons you can craft deals with especially nice features. We are very bullish on private credit, even though you need to pick your shots carefully given the outlook for the economy and the knock-on effects for credit quality generally. You know, let's take a look at how far we've come. Virtually all of the deals are floating rate, and so there's a base rate plus a credit spread. That base rate in the last six months has gone up 400 basis points. At the same time, because the negotiating balance of power has shifted in our direction, market's less competitive, credit spreads have widened out at the same time. So what we were looking at just a year ago for dollar one senior term debt with yields of 7%-8% are now 10%-11%+. I haven't seen 11% yield on dollar one senior debt in more than a decade. Same time, 'cause debt's more expensive, market can be more disciplined, debt levels have declined. 2021, it was routine to see deals, LBOs being structured with debt levels of 6x-7x. Today it's 5x-5.5x. Equity contributions are also up. The private market valuations have not adjusted as quickly as seems to be happening on the public side. The debt levels are going down. It's gotta get filled with something. That is getting filled with equity. The average middle market LBO today is comprised of 50% cash equity supporting the debt in that capital structure. That too is equity cushion at historic highs. Last but not least, there's no more debate about whether it's gonna be cov-lite or involve traditional financial covenants, maintenance-based financial covenants. Every deal today is coming with those. In addition to that, all the creditor protections have really substantially tightened up at levels again that I haven't seen in quite some time. That's where the market is today. In general though, I also think that private credit as just an asset is especially well suited for the environment that we see today. As I said, all of the debt is floating rate. It's got zero interest rate risk. All the rises in short-term rates have actually been a benefit and contributed to the overall return for the underlying asset. No mark-to-market volatility. It's in the safest, most senior part of the debt capital structure, and it generally comes with less leverage as compared to broadly syndicated loans, high yield bonds, and certainly second liens and junior debt. It's secured by all the assets. You actually have real collateral, but you also have superior rights in workouts and bankruptcy. It comes with premium yields that compare favorably to most, if not virtually all of the credit alternatives that are available in similar credit quality. I think the proposition today that makes it so attractive is that not only can you get the premium yields 11%, for senior first lien dollar one risk, but you can play defense at the same time. Nice combination of features. With that, I think I'll turn it back to Anant. Thank you again for having me. Thank you, Bill. Hopefully that gives you all a little flavor of, again, why we think middle market credit is the better place to be. Every time we get the question on CLOs on the balance sheet, that's where you hear Jim and me talk about that's from the past. We're focused more on pockets where we see opportunity. Now I'd like to invite Josh to talk about 26North. Josh doesn't need much of an introduction, but for those of you who don't know him, he's got an impeccable track record having built Apollo, and now he's doing what most people don't really expect a founder of a very successful firm to do, is to work on the 2.0 for his industry. I think the way that he's attracting talent and building out, 26North is something you should hear from him. Additionally, his successes in this area of sports is also very, I think, symbolic of what's required in this business, is talent. With that, Josh, welcome. Thank you. Hello, everyone, and nice to be here. Thank you, Anant and the AEL team. When I left Apollo in May of 2021, I kind of thought a lot about what to do, and I realized that there was a long-term trend. The commoditization of the public markets, which I think you all are familiar with, had left private market alternatives to be a better risk return in many cases across the spectrum of private equity, credits, real estate. There continued to be this long run opportunity. On the other hand, some of the larger alternatives firms had gotten so large that their ability to generate alpha was harder. Their ability to attract talent, obviously the value proposition that I had early on in my career, the value proposition of owning, you know, part of a business, is a bit harder as you get larger. I was also inundated by kinda calls from institutional investors and talent who were lined up to help support me start something great. I decided to do version 2.0, and it's super exciting. I think the environment is lining up quite well, relative to 26North and my own personal skill set. We've been able to attract the all-star team and, you know, obviously are very excited about, you know, the opportunities that we have going forward to help, you know, investors that like AEL or like other institutional players. It's I'm looking forward to the future. When we thought about what to do, we purposely built an ecosystem that was highly synergistic across private equity, credit, insurance. Obviously, I've lived this before, and there's like massive synergy between all three of those boxes. In effect, I saw the power of linking institutional capital with insurance-based capital and liabilities. I saw the power of linking asset management platforms in private equity and credit without the so-called information barriers. The ability to be agile and to move up and down the capital structure across geographies, across asset classes, across investments to pivot to senior debt, when as we were just told, it's highly attractive to pivot to private equity when that's attractive, we felt, and I continue to feel is the best way to set up an institutional platform. That's what we're doing. In fact, you know, at Apollo, but also here now, I think that insurance companies like AEL have unique liabilities that need to be that where certain assets are fit very well. The knowledge base that I bring, which hopefully will be helpful to AEL, you know, to allow them to invest in asset classes that are dislocated kind of, but are appropriate for their own liabilities is something that I'm really looking forward to. This isn't just me talking about other people's money. I'm putting up, you know, my own capital into this. As I speak with people, it's speaking as an investor alongside of them where I stand to benefit if things go up, and I tend to lose if things go down. There's a lot of alignment. We've come out of the gates very fast. You know, we're up at $9.5 billion of assets. We have 60 people, and that's rising. You know, we're seeing, you know, a lot of talent flood to us as, you know, they perceive us to be a unique and differentiated opportunity. As Anant said, you win with talent. Investing is a game of talent. You win with strategy, obviously. You win with thoughtfulness and trying to find dislocations and arbitrage across the private equity, credit and insurance markets. You also win with talent and execution. Obviously, when you look up at the talent that we have, whether it be Brendan McGovern from Goldman Sachs, who built their $11 billion credit business, and, you know, he himself managed a number of public BDCs and private credit vehicles, whether it be our future head of private equity that was running North American private equity for another large institution, you know, whether it be some of the other people on the list, each of the individuals that have joined are leaving established firms where they have their own track records. Their returns have been high, and they've also managed groups of people and been highly successful. The ability to track these people on behalf of AEL and its underlying customers, as well as other institutions, is what's really driving our success and will continue to drive our success. We expect to continue to be able to attract the top talent in the industry. You know, I'm highly grateful they're joining us. It was great to hear more in person about AEL 2.0, and I feel that we are highly qualified to support AEL's strategy. I think that, the breadth of our platform and the ability to move across debt, private equity, real estate, core private equity, will allow for us to help AEL succeed in terms of generating alpha. When you're managing, you know, insurance company capital as AAL is, and as we are now as a reinsurer, obviously the ability to generate, 30 extra basis points of return, as Anant said he did 50 extra basis points of return, 100 extra basis points of return, that is, a very important criterion, but without increasing risk. That is, you know, what I think we'll be able to help with. In addition, obviously, as Anant mentioned, the capital intensity of insurance companies is in focus. Every $1 of capital needs to be, kind of generating the highest possible return and where possible. As we did, this year, we're prepared to step in and use our balance sheet, to support AEL as needed and also to co-invest significantly side by side with whatever they do for us. Lastly, clearly AEL is an owner of 26North and, you know, they will obviously benefit from what I look at as a relatively early kind of low price, as I believe and hope that our firm will successfully accrete its own valuation up in the future. This is kind of more detail on how, obviously I've been through this in a prior life and helped support a very large insurance company, and I would expect to be able to do that again. You know, obviously, as you think about different private assets. They come in many, many shapes and sizes. They can come in a company, they can come in a private security, they can come in a yield origination platform, which will sustainably generate extra alpha, where in addition to buying the flow, you can own part of the company. you know, we are highly engaged with the AEL team. We've basically taken kind of a third of our firm, literally, and we're focused on how to feed their liabilities in a way that adds value for AEL 2.0 and synergistically create value for both AEL and 26North. we have multiple opportunities that they're scrutinizing. They're tough risk managers. We don't, we don't get through the funnel very often, but we're gonna continue to show them highly bespoke, idiosyncratic, alpha-generating opportunities that will add value to AEL's vision of 2.0. Clearly, if we can do that, they'll generate more policy, they'll generate more kind of flow through in their own distribution network, and that'll feed back theoretically to us through them having more assets to manage. You know, obviously one of the things we're gonna do is private equity. You know, obviously I've done this my whole life. I mean, this is where I started, built one of the biggest private equity businesses on the planet. You know, in essence, 26North is gonna go back to basics. You know, back to buying companies, cheaply, back to buying cash flow. A diverse you set up diverse industry sectors. You go very deep. You set up the ability to create value operationally, whether that be digital transformation, whether it be purchasing, whether it be cost structuring capability, and then you do rigorous diligence, and you make money on the buy. You buy cash flow cheaply by managing, process, by distress for control, by a corporate carve-out, by building a company. There's any number of ways to do it, but you widen the sourcing funnel so that you're creating cash flow at arbitrage relative to where the market is creating it, and then you stay disciplined on operating the companies, and you add value and ultimately exit. We would expect to have a lot of success in this. We think that people have chased growth. We think there's a void in the market in the $2 billion-$5 billion enterprise value space where you're above the middle market but below the big funds, and we would expect to capitalize it. Importantly, from an AEL point of view, you know, there are specific insurance-related private equity products that are unique to AEL and other insurance companies' bespoke liability structures. They are not as volatile. They need to be highly structured, and we are working very hard to develop, you know, those products for AEL to support vision 2.0. Direct lending. I tend to agree with our last speaker that this is an incredible space right now. The ability to be top of the capital structure as you head into a potential volatile environment, the ability to earn 11% returns with lots of equity below you, the ability to have covenants and better documents and control structures, all of that makes, you know, this asset class very, very attractive for insurance companies. Anant and team are ahead of the curve in terms of their focus on this. Not all of it has to come from middle market sponsors. Clearly, some of it comes from middle market sponsors, but there are other opportunities outside of that space, whether it be direct origination through companies, whether it be kind of different types of sponsors that we'll avail ourself of. We expect that we will be able to generate, as was mentioned, 11%-12% returns by bespoke origination outside of the public markets in a very attractive way with downside protection and make it suitable for insurance company capital. I know in the sense that I own, I've now reinsured a lot of insurance liabilities, and it's where I'm gonna lean in myself to getting some extra return. If you're successful at that 30 basis points, that 50 basis points that you need to earn on your portfolio, you know, this can add a lot of value. I think it is a wide open attractive space. We come into it obviously with a clean book. We have no issues, and we're very focused on playing offense and creating solutions for companies that might need capital. You know, obviously, this is a good time. With that, to sum up, AEL is a first-class organization with an incredible distribution channel and incredible management team. You know, we're very focused on building an asset management firm, and a bunch of asset management platforms that are highly focused on insurance company capital that understand the needs of insurance companies. We would expect to be able to offer AEL proprietary investments. Proprietary platforms, access to differentiated talents, and value-added yield strategies. Obviously, AEL's minority participation in 26North at a kind of early low price will kind of align them in our success, and we will tailor our offerings around, you know, what they need. Thank you very much, Anant, and thank you for having us, and thanks everyone for listening. Appreciate it. Thank you. Again, this is Steven Schwartz with Investor Relations. Before we move into Q&A, which will be AEL only Anant and Axel and Jim, I do want to say thank you to our investment partners and please join me in giving them an ovation. With that, guys, if you come on up, we are running pretty much on time. Anant, Axel, and Jim, if you'll come up, we'll take questions. Please wait for the microphone so people on the webcast can hear you. Kayla will have the microphone. We'll start. Erik Bass. Thanks. Eric Bass with Autonomous. Just, first question just on the spread-related assets. You've talked about like sort of keeping or bringing down the amount of capital allocated to spread. How should we think of the spread AUM trending going forward? Should that continue to come down as you cede some of that into the sidecars over the next couple of years? Should I go here? Yes, go ahead. Oh, yeah, Erik, that's right. When I was showing the charts, basically implied in that was a decrease in the balance of assets or liabilities resulting in spread-related earnings, essentially through because as I was showing the amount of flow business, of newly originated business that we cede to reinsurance is increasing from, you know, the 10% in 2021 to the 50% in 2025. That balance will naturally shrink over time and stabilize at some level by 2025. Got it. I guess tying that to the earnings, you expect the spreads to widen. Would you expect the dollars of earnings to actually decline or just the spread widening sort of keep that earnings level more stable? Right. That's why I was showing the dollars of earnings to essentially remain stable. While the balance might be decreasing, the margin expansion is going to sustain that. I guess one more. Just I think the other assumption you had is for new business is ramping up to, I think it was $4 billion of volume next year and then $5 billion the year after. I think you've talked year-to-date, the challenge for growth has been more competition than your ability to source assets or other things. What gives you the confidence in being able to grow and maintain the level of IRRs or even expand them that you talked about on the slides? Hi, Eric. Predominantly because we've done it before. What we were measured this year about was very clearly not chasing rates if you didn't know the trajectory of rates. The fact that, you know, in the month of December, we repriced to be more competitive. You have to be in the top quartile to get volume. We were by design being second quartile because we weren't sure where rates would go. I think we learned our lesson a little bit this year, but we chose profitability at any cost, and now we see profitability sustainable in the 12-14 IRR range and the market there for us. The slide that I had that covered about the loyalty in the IMO channel, without the IMO channel, we wouldn't be able to do it. That is the bread and butter. That's why when I joined the firm, the first focus was not chase Eagle. Build Eagle slowly. The time is right. You saw we did $2 billion of MIGA when we saw opportunity. The asset opportunity was there in real estate with our friends at Pretium. We did it then. We can always scale MIGA up and down, but the FIA business growing to $5 billion is very much doable. Okay. Starting back, Tom. Thanks. Tom Gallagher, Evercore. First, just a question about the $1.8 billion of available liquidity in the OpCo. How much of that is actually cash versus how much is FHLB capacity? I'll let Jim take that one. Sure. That number varies, you know, over time, different points in time. Certainly the mix is different. You can think of that, you know, number as probably a little more than half of that's FHLB capacity. A little bit out of that is actual cash. Cash is short term. When we think about, you know, cash, it's oftentimes, you know, today it can be in short Treasuries, for example. There's a reasonable yield on the short part of the curve today. I guess just relatedly, how are you thinking about the tail risk for the company right now? I think the expansion into the different investment partners makes a lot of sense, you know, moving into more illiquid asset classes with better risk-adjusted returns. However, when you think about the storm that could be ahead of us, if you think about different scenarios, and you think about disintermediation risk, how do we think about that? If I just point out a few things. This quarter, because of competition, you had net outflows. If rates spiked higher and the outflows worsened, you know, less than $1 billion of cash is not a lot of liquidity given the level of outflows. How do you balance all that out with the risks ahead of you right now? Yeah, I mean, the process, you know, includes, you know, running models across various scenarios. We take a look, of course, at scenarios where rates are going down, rates are going up, rates are staying relatively flat. We have been deploying assets in the private space, but we've also been buying some very liquid public assets this year too. It's not completely private asset purchases. They're very liquid triple-A assets that triple-A-rated assets that we bought that are available as a good source of liquidity also. You know, we factor all of that in when we take a look at, we are running stress tests, running liquidity models across the company, across scenarios. Just final question. In terms of the investment partnerships, are you pretty much done, or are there additional strategies you'd be looking to enter into with new partners? Thanks, Tom. Asking that in front of three partners I have yet. I'm joking. I don't think we're ever done, but I think we have the breadth now that we want, and we wanna go deeper with the partners we have. The area that both Jim and I are acutely focused on is cash flowing private equity. That's an area where we've been working on. We've looked a lot of infrastructure deals we'll look to do. We've got the partners we like to work with. Now, if I get a call tomorrow morning and something looks very interesting and unique, we'll of course explore it. We just need to go deeper with the partners we have. A little bit to add to Jim's point on the liquidity point. If we need to go $5 billion liquid, we could. The portfolio is still highly liquid. Highly liquid. We will take actions on our in-force business so that we slow down the exits on our in-force business. I think post-LDTI, we have a little more leverage to do that's what we're evaluating right now. You know, cash is cash, but even from a GAAP earnings point of view, it's less of a headwind post-LDTI. I probably made Axel uncomfortable by saying that, but you should know, like, we're focused on the in-force business. We don't wanna lose what we're losing on the in-force. Okay. Ryan? Thanks. Ryan Krueger, KBW. First question was, can you give any more detail on the in-force transaction with 26North? I think you said not to expect a material impact to earnings next year. I'm just trying to understand. I'm sure you're losing spread-related earnings. What the offsets are? You want to take that, Axel? I can add Anant for you. Sure. Yeah, from an earnings perspective, we essentially expect it to be flat next year, because we lose the spread-related earnings. We gain the gain on reinsurance essentially, right? It gets amortized through earnings, as well as the redeployment of the capital released, part of that capital released through this transaction. Second question would be, how far along are you in capital raising for future sidecars? Like, do you already have a level of committed capital, or can you give us a sense of how far along you are there? Yeah, great question. It's a hard market for LP raising, for sure. We see a lot of interest from institutions in wanting to partner with the value of the origination platform. How far are we? We look to close something in 2023. We have a number of conversations in flight, but it's not gonna be before, like, the second quarter or the third quarter of next year that we actually close it. Wanna make sure it's the right partner. Thanks. Last one for me was just on the existing Brookfield Reinsurance agreement. Mm-hmm. Given the back and forth between your firms right now, I guess, can you help us understand if they have any optionality to change or cancel that agreement or if it's fairly set in stone? Yeah, it's a great question. Look, the primary reason Brookfield became a shareholder, 'cause we believe they believed in AEL 2.0, and it drove alignment. You know, they had roughly under 20% of our liabilities over time, and therefore coming around 15%-20% of equity. If they're no longer an equity investor in AEL, we may wanna change that arrangement. The way that arrangement works, it's contractual. They can hit $10 billion. They're at $5 billion, $4.95 billion or something at the end of the quarter, so just under $5 billion. It's based on pricing. We can change the pricing on the product, and they can choose to accept it or not accept it. Now, it's beneficial for both of us to keep the arrangement going, but we will see how they behave as a shareholder. Okay. Let's go to Barnidge. John Barnidge, Piper Sandler. Thank you. Do you have a timeframe on the RILA rollout, but not FA with flow reinsurance support? FA with flow reinsurance support? We didn't outline scaling FA, is your question, John? Well, on slide 11, you have a timeline put out for RILA launch. Yes. You don't have FAs with flow reinsurance support. Are you talking Should we be essentially looking to the timeline you laid out on the 30%-40%-50% usage of that for that? Without FA. Without fixed annuities. Yes. Yes. Okay, great. Yeah. And then- Fixed annuities is extra gravy. It's further upside. Okay, great. Thank you for that. Can you talk what international expansion could potentially look like? It would be premature for me to get into it, but I would tell you, U.S. FIAs are very, very attractive for replication in other developed retirement markets, and you can deduce it from that. My last question, you talked previously about targeting a 30%-40% private assets in the investment portfolio. You're at 18% now. You've expanded your investment partners quite a lot. Does 26North help you get there quicker, or does it allow you to go beyond that? Thank you. Thanks, John. We're not speed motivated. We're relative return motivated. Right now, I think the big discussion the three of us are having, and Jeff, who's our Chief Risk Officer, is really around you don't need it to go all the way to 30%-40% even. You can get there with core fixed income in the right pockets. I mean, Triple-A CLOs is a great space to be right now. Double-A CLOs is a great space to be right now. Just right now, right? I think we looked across cycles 30%-40% to be a good allocation. Right now, we would probably be on the lower end of that, but I'll let my Chief Investment Officer add in more if you like. Yeah. Yeah, I think that's right. I think if you remember in one of Axel's slides, we have $5 billion of origination this year in private assets, you see long term that number was more like $4 billion. As we scale up, you know, we have less need to scale as many private assets. You know, anytime we add a partnership, of course, that helps us source more assets. For us, it's really focusing on deepening those relationships and making sure that we're getting assets where we like the risk profile, making sure that it works from a capital perspective and works for our liabilities. Yes, anytime you add a partner, it will help do that. It actually gives you a broader range of asset classes in which you can invest. It would certainly help us scale up. I think Anant was indicating was we don't feel a great need to get to 30%-40% quickly because right now public and private markets have both moved so much this year that we're seeing good opportunities outside of the private asset space. Can I add one other thing, thanks, Jim, to that? What you see us doing is we're always measured from a risk-return point of view. One of the best parts of all of our partners, and Bill and I talk about this a lot, is the last thing I ever do is call up Bill and say, "Go faster." If he says, "Go slower," I'm like, "Fine, go slower." Right, Bill? I mean, that's the philosophy point I think he was referring to, the cultural fit and the risk culture. We're setting ourselves up to be a $100 billion institution. Now we're 50+ right now, between 50 and 60. That's what I'm looking at. These partnerships, how do we become a $100 billion institution in terms of the assets we're managing? Therefore, the partnership with 26North, with Pretium, with Adams Street and others is so critical. I got one more too. One more quick addition to that. When we set goals for our asset managers, think of asset managers as our specialists in a sector. We have someone that works with Bill's team on middle market credit. We do not set volume-based goals for them. They are paid based on quality of assets that we put on. We're always making sure that no matter what, we're putting quality assets on the balance sheet. Pablo? Hi. The first question is there a flow component in the Remedy Insurance relationship with 26North? If there is, can you sort of talk through that? Flow component, Pablo? Yeah. Yeah. There is up to $525 million of MIGA or SPDA. There's a framework to that, and we look forward to executing on that at the right time. You could see us seeding up to $525 a year to them. Okay. Then second question, just on the sidecar, I was wondering if you'd provide context on the, I guess, overall economics of the sidecar, right? Because if I understand correctly, you guys are getting a 5% upfront commission, right? If you think about, you know, typical ROA and annuity business, $150 a year, maybe seven years duration, that's 7%, right? You're getting 5% of that 10%. Clearly the pie must be much bigger. If you could just like speak to, you know, the overall pie and maybe how that's going to be split between the investors and you. I'll let Axel do that, and I'll add on if he wants in the end. Sure. The seeding commission is one component, right, of the economics of a sidecar. In addition to that, we expect to be functioning as an asset manager, an investment manager for the assets of the sidecar. Certainly there's investment management fees there, and potentially other fees, as we provide services to those sidecar vehicles. For example, hedging and ALM services are clearly strategic asset allocation. Services are certainly something which we provide today as part of the Brookfield arrangement, and we would expect to provide as part of the sidecar vehicle. There's additional economics that come through there. The only thing I'll add to that is I think you're trying to get to how much use is in the profitability that we can make illustratively five, and they can still meet their return hurdles, right? Obviously, based on the asset allocation we're driving, we believe investors will be able to make 12%-14% unlevered returns after paying us back return. It's driven off the assets and the stable liabilities that we originate, those coming together and us driving the ALM. As I've always said, Pablo, the brains of an insurance company is ALM. You get that right, you get the power on both sides, the assets and the liabilities, you win. Okay, thanks. The last one for me, the $850 million excess capital number, does that include the $250 released with the 26North transaction? I guess, as a follow-up to that, how do you think about that $850 over time, right? Obviously, there must be some buffer you're thinking about, but is that a number that you can potentially draw down over time? Thank you. Yes, it does include the capital released from 26North transaction. Over time, our capital management framework essentially looks at ensuring that following the impact of a level of stress, whether it's a moderate stress or at times we may wanna be more prudent and have a deep recession scenario as our buffer of capital. That plus our capital return plan to shareholders needs to leave us capitalized in a manner that's consistent with the rating. Anybody else? Hold on. Is AEL planning to write the majority of new business into flow reinsurance over time with these sidecars, or how much is going to be retained to be spread-based? So as I was showing in the illustrations, by 2025, we would be ceding 50% or slightly more to the various reinsurance relationships, including the sidecars. Ultimately, we would always expect to retain 25% of the business. That's a minimum. It's plausible that we, beyond 2025, if we're widely successful in the execution, that the amount of business ceded is greater than 50% and less than 75%. I expect that Brookfield might push back on the flow reinsurance agreement at this time. I honestly have not been good in predicting their motivations, so I'm not gonna try now. Anybody else? All right, thanks. Again, thank you all. Thank you to our investment partners. Thank you all for attending. Thank you all for your interest on the webcast. We really appreciate it. This concludes today's conference call. Thank you for participating. You may now disconnect.