Athene Holding Ltd. Investor Day. October 29, 2015

Transcription

1 Athene Holding Ltd. Investor Day October 29, 2015

2 Disclaimer This presentation does not constitute an offer to sell, or the solicitation of an offer to buy, any security of Athene Holding Ltd. ( Athene ). Certain information contained herein may be forward looking in nature. These statements include, but are not limited to, discussions related to Athene s expectations regarding the performance of its business, its liquidity and capital resources and the other non historical statements. These forward looking statements are based on management s beliefs, as well as assumptions made by, and information currently available to, management. When used in this presentation, the words believe, anticipate, estimate, expect, intend and similar expressions are intended to identify forward looking statements. Although management believes that the expectations reflected in these forward looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct. These statements are subject to certain risks, uncertainties and assumptions. Due to these various risks, uncertainties and assumptions, actual events or results or the actual performance of Athene may differ materially from those reflected or contemplated in such forward looking statements. We undertake no obligation to publicly update or review any forward looking statements, whether as a result of new information, future developments or otherwise. Information contained herein may include information respecting prior performance of Athene. Information respecting prior performance, while a useful tool, is not necessarily indicative of actual results to be achieved in the future, which is dependent upon many factors, many of which are beyond the control of Athene. The information contained herein is not a guarantee of future performance by Athene, and actual outcomes and results may differ materially from any historic, pro forma or projected financial results indicated herein. Certain of the financial information contained herein is unaudited or based on the application of non GAAP financial measures. These non GAAP financial measures should be considered in addition to and not as a substitute for, or superior to, financial measures presented in accordance with GAAP. Furthermore, certain financial information is based on estimates of management. These estimates, which are based on the reasonable expectations of management, are subject to change and there can be no assurance that they will prove to be correct. The information contained herein does not purport to be all inclusive or contain all information that an evaluator may require in order to properly evaluate the business, prospects or value of Athene. AAA or Athene does not have any obligation to update this presentation and the information may change at any time without notice. Certain of the information used in preparing this presentation was obtained from third parties or public sources. No representation or warranty, express or implied, is made or given by or on behalf of Athene or any other person as to the accuracy, completeness or fairness of such information, and no responsibility or liability is accepted for any such information. Any target IRR is based upon estimates and assumptions that a potential investment will yield a return equal or greater than the target. There can be no assurance that Athene s targets will be realized or that Athene will be successful in finding investment opportunities that meet these anticipated return parameters. Athene s target of potential return from a potential investment is not a guarantee as to the quality of the investment or a representation as to the adequacy of Athene s methodology for estimating returns. Accordingly, the target return should not be used as a primary basis for an investor s decision to invest. The targeted IRR information is presented gross and does not reflect the effect of management fees, incentive compensation, certain expenses, and taxes. It may not be possible to directly invest in one or more of the indices and the holdings of any investment made by Athene may differ markedly from the holdings of any such index in terms of level of diversification, types of securities, or assets represented and other significant factors. Indices are unmanaged, do not charge any fees or expenses, assume reinvestment of income, and do not employ special investment techniques such as leveraging or short selling. No such index is indicative of the future results of any Athene portfolio. This document is not intended to be, nor should it be construed or used as, financial, legal, tax, insurance or investment advice. There can be no assurance that Athene will achieve its objectives. Past performance is not indicative of future success. Please refer to Apollo Global Management, LLC s last periodic report, which is publicly available at for the definition of Assets Under Management or AUM All information is as of the dates indicated herein. 2

3 Management Speakers Jim Belardi Bill Wheeler Grant Kvalheim Chip Smith Chairman, Chief Executive Officer and Chief Investment Officer, Athene Holding Ltd. ( Athene ) and Athene Asset Management, L.P. ( AAM ) 29 years of industry experience Past experience includes 20 years at SunAmerica, including 13 years at SunAmerica Life Insurance Company and 7 years as Chief Investment Officer of AIG Retirement Services Inc., responsible for a $250 billion invested asset portfolio In 1994, Jim was President of SunAmerica when the FA Backed note market was created (AIG SunAmerica was one of the largest FA Backed note issuers) President of Athene Holding 28 years of financial services industry experience Past experience includes 18 years at MetLife Inc., most recently as the President of the Americas, overseeing three major divisions, 26,000 employees and 80% of MetLife s overall financial results Prior to being President of Americas at MetLife, Bill held various roles including EVP and Chief Financial Officer, and prior to the CFO role, oversaw product management and marketing for the individual business and financial reporting for the institutional business. In addition, Bill served as Treasurer where he played a key role in preparing MetLife to become a public company Chief Executive Officer of Athene USA 33 years of financial services industry experience Past experience includes six years at Barclays Capital where he served as Global Head of Credit Trading & Global Head of Investment Banking, and ultimately as Co President Prior to joining Barclays, Grant was a member of the Corporate and Investment Bank Executive Management Committee at Deutsche Bank as Head of Global Debt Origination President of Athene USA and Interim CFO of Athene Holding 27 years of financial services industry experience Prior to its acquisition by Athene, Chip was President and Chief Executive Officer of Liberty Life and affiliated companies He also served as Liberty s Vice President, Treasurer and Chief Financial Officer and held various positions in Finance including Controller Prior to Liberty Life, Chip worked for Ernst & Young Chip is a Fellow of the Life Management Institute (FLMI) and is a Certified Public Accountant. 3

4 Table of Contents I. Introduction to Athene II. III. IV. Overview of Athene s Liabilities Overview of Athene s Investment Portfolio Overview of Capitalization & Risk Management V. Financial Overview VI. Growth VII. Conclusion VIII. Appendix 4

5 Introduction to Athene

6 Athene's Investment Thesis Athene believes it has built an efficient multi channel platform to capitalize on attractive market trends and generate a long term, highly visible earnings stream for its shareholders Highly visible, spreadbased earnings stream Accomplished and proven management team Ideal multi channel platform to source longterm, low cost liabilities Strong, well capitalized balance sheet with no financial leverage Efficient corporate platform to underwrite incremental business at minimal cost Differentiated investment strategy through AAM & Apollo 6

7 Athene s Opportunistic Market Entry When we were founded in 2009, life insurance was an industry in distress: Legacy asset & liability issues Prohibitively expensive equity Regulatory change Shrinking market supply At the same time, turmoil in the financial markets was driving demand for guaranteed return products, just as traditional life insurers were pulling back from the space We capitalized on this market dislocation to found Athene at a time when funding costs were low and asset spreads were high 10 Year US Treasury Yields vs. Asset Spreads Athene founded in July % 2.03 % USD 10y Treasury BAML US Corporate BBB Option Adjusted Spread Our opportunistic founding allowed us to aggregate substantial blocks of long duration, low cost liabilities which serve as the foundation of our spread based business model Against our low cost liabilities, we have invested in an attractive cash flow matched investment portfolio to generate a longterm, persistent net spread and a significant base of earnings for our Company going forward Attractive cost of funding allows us to be patient, disciplined and opportunistic in our investment philosophy our asset allocation is driven by market opportunity Since our opportunistic founding, we have capitalized on favorable trends to develop into a sustainable franchise that will perform across market environments Source: Bloomberg 7

8 % 20% 15% 10% 5% 0% Attractive Market Trends Supported Athene s Ability to Scale Millions of People Age 65+ Market Backdrop Aging American population driving demand for tax efficient retirement savings products Baby boomers remain underprepared to fund retirement Supply coming out of the market due to post crisis regulatory and rate environment Aging U.S. Population (1) Insufficient Retirement Savings (3) 10,000 people will turn 65 in the U.S. every day for the next 15 years (2) 45% of all working age households do not currently own assets in a retirement account savings catch up will be necessary for retirement 12% 13% % 85 21% % 22% 24% % of Total U.S. Pop. No Retirement Account 45% Retirement Account 55% Number of People Age 65+ % of Total U.S. Pop. (1) Source: U.S. Census Bureau 2014 (2) Source: Pew Research Center (3) Based on household retirement account ownership for all heads of households aged 25 64; National Institute on Retirement Security

9 AIG Allianz NY Life Athene TIAA Cref American Equity Life Jackson Well Capitalized & Scaled Annuity Writer We are one of the largest and most profitable fixed annuity platforms in the United States Scaled and Growing Platform (1) Leading Fixed Annuity Players by Reserves ($ billions) (3) Sustainable franchise with multiple channels to source longterm, low cost liabilities Scaled and efficient platform capable of onboarding incremental business at limited cost 4 th largest fixed annuity and 2 nd largest fixed index annuity platform by reserves (3) Generates income by earning a spread on a cash flowmatched asset and liability portfolio Average operating ROE from 2013 YTD 6/30/15 of 24% Run rate ROE targets of 15%+ $ 74 $ 67 $ 56 $ 45 $ 39 $ 31 $ 28 Onshore RBC of 529% (5) $60.9 billion in invested assets (4) and GAAP equity of $5.3 billion (excluding AOCI) 2014 retail sales of $2.6 billion (2) A financial strength rating 1,100 employees and 769,000 policies Note: past performance is not indicative of future returns. See target return disclaimer on page 2. (1) Data as of 6/30/2015 unless stated otherwise (2) Represent all money paid into new and existing insurance contracts, including internal transfers to AAIA, AADE and AANY (3) Includes statutory reserve contracts for individual fixed and individual indexed annuities only (i.e. excludes payout annuities and other). As such will not tie to total reserve figure. Data as of 2014 year end per SNL. (4) GAAP figures in this presentation represent management view GAAP unless otherwise noted; see Appendix for further detail. (5) Company Action Level RBC. 9

10 Best in Class Business Model Liabilities (2 3% Run Rate Cost) Underwriting focus on: Risk adjusted absolute and relative cost of funds Duration Capital intensity Assets (4 5% Run Rate NIER) Underwriting focus on: Asset allocation for outperformance Strong downside protection Cash flow matched profile Long term asset performance hold tomaturity rather than markto market focused Capitalize on strategic relationship with Apollo and AAM Take advantage of market dislocations Risk Management Embed risk management in all facets of our operations Manage our business on a comprehensive economic capital basis to withstand severe adverse shocks Ensure we are appropriately capitalized to take advantage of opportunities in a downturn Our multichannel distribution platform, differentiated investment strategy, and scalable and efficient corporate structure allow for superior shareholder returns across market environments 10

11 Flexible Multi Channel Distribution Platform Our platform supports opportunistic origination across market environments, which better enables us to achieve stable asset growth while maintaining strong levels of profitability We evaluate liabilities across each of the below channels based on: (1) the upfront cost of acquiring the liability, and (2) the liability s ongoing cost of crediting Organic Channels Retail Flow Reinsurance Institutional Significant growth driver, with sales through August 2015 of $1.8 billion (1) Provide high quality products and service to our policyholders and maintain appropriate financial protection over the life of their policies Licensed to sell products in all 50 states (2) and the District of Columbia Reinsurance to ALRe from third parties (either directly to ALRe or via Athene's U.S. entities) Reinsure MYGAs, FIAs and payout annuities Opportunistically issue funding agreements to institutional fixed income investors Products are scalable without any ability to surrender prior to maturity Inaugural offering in October 2015 $250 million 3 year issuance Inorganic Channels Acquisitions and Block Reinsurance Demonstrated transaction expertise; we have completed five strategic transactions since formation Target acquiring businesses at a discount to book value and using part of this discount to subsidize cost of liabilities (assets received > liabilities assumed) Target writing capital efficient retail product at today s low rates (1) Represents all money paid into new and existing insurance contracts, including internal transfers (2) Products sold through AANY in the state of New York 11

12 Attractive Low Risk Liabilities Conservative underwriting strategy focused on sourcing low cost, stable policyholder obligations we are focused on riskadjusted profitability, duration, and capital intensity rather than volume or market share growth For the eight months ending August 31, 2015, 40% of our sales contain an income rider (only 20% of sales are guaranteed income riders) Overview of GAAP Liabilities Preferred structural features: Low capital strain Long duration Surrender protected Low cash cost (upfront acquisition costs + ongoing crediting rates) Conservative guarantees Single Premium Immediate Annuites/Payout 10% Fixed Rate Annuities 19% Other¹ 5% Fixed Indexed Annuities 66% Total GAAP reserves $60.0 billion Weighted average life 9.8 years 2.7% Cost of Funds (5) (~60bps spread to 10 Year Treasury) % MVA protected (2)(3) 71% % Surrender charge protected (2)(4) 84% Aggregate surrender charge protection (2) 8.1% Weighted average surrender charge period remaining (2) 5 years Note: As of 6/30/15 unless otherwise noted (1) Other includes funding agreements & retained life business (2) Based on fixed index annuities and fixed annuities only (3) Refers to the % of account value that is protected by MVA (4) Refers to the % of account value that is in the surrender charge period (5) YTD 6/30/15. Defined as GAAP cost of crediting, GAAP DAC/DSI/VOBA amortization, GLWB and GMDB change in reserves, and other divided by average GAAP reserves. 12

13 Near Term Liability Growth Drivers The $1.3 billion of capital we raised in 2014 has positioned the Company for continued growth in the near term Organic Growth: Illustrative Long Term Opportunity Sizing Current FABN IMO Increased IMO penetration Access to the FI channel Access to the FABN market Third party reinsurance FABN Financial Institutions IMO Access to larger money banks and wire houses Pension buy outs Financial Financial Institutions Institutions IMO B++ A A Opportunistic Growth We are holding excess capital to take advantage of attractive inorganic growth opportunities as they arise Reinsurance Growth Opportunities Acquisitions 13

14 Diversified Asset Portfolio We have constructed a diversified asset portfolio through disciplined underwriting and an intense focus on riskmanagement Asset management strategy focused on capturing incremental returns without assuming incremental credit risk Downside protection focused, with asset allocation informed by rigorous stress testing Focus on underwriting high quality assets and capturing incremental spread by assuming incremental liquidity and complexity risk rather than credit risk 87% of total portfolio rated NAIC 1 or 2 (1) and 94% of fixed income investments rated NAIC 1 or 2 (highest designation) Maintain enough portfolio liquidity to opportunistically capitalize on market dislocations CMBS Alterna ves 4% 6% Mortgage Loans 10% RMBS 13% Portfolio Mix ABS & CLO 14% Corporate & Gov't 49% Cash & Equivalents 4% Policy Loans & Other 1% Portfolio NAIC Ratings (1) NAIC 4, 5, 6 2% NAIC 3 6% NAIC 2 36% Other (Alts/ Equities) 6% NAIC 1 51% Average NAIC Rating: 1.8 Note: Data as of 6/30/15. (1) CML mapped to NAIC ratings based on underlying capital charges. CMLs designated CM1 and CM2 are included with NAIC 2 assets, CMLs designated CM3 and CM4 are included with NAIC 3 assets, and CMLs designated CM6 are mapped to NAIC 6. For average calculation, alternatives and equities mapped to NAIC 6. 14

15 Differentiated Asset Management Capabilities Athene s investment portfolio is managed by Athene Asset Management, L.P. ( AAM ), a subsidiary of Apollo Global Management, LLC (together with its affiliates, Apollo ) AAM was founded for the express purpose of providing a full suite of investment management services to Athene 100+ person team of dedicated investment and operations professionals led by Jim Belardi, former CIO of $250bn AIG Retirement Services portfolio Source of strategic advantage as it provides access to Apollo's global scale, 300+ Apollo investment professionals, and the infrastructure services of a ~$162 billion asset manager As of 6/30/2015 AAM manages 100% of Athene s assets, of which it directly invests ~75% with its in house investment team (primarily into investment grade credit and other structured assets) The remaining ~25% of Athene s investment portfolio is sub advised by Apollo or invested in Apollo funds. The majority of the assets Apollo sub advises are invested in high quality credit securities, with a small portion opportunistically invested into various Apollo funds that manage higher yielding strategies Total Athene Portfolio AAM Managed ~75% Subadvised and Apollo Funds ~25% Subadvised and Apollo Fund Asset Composition ($ billion) Value Oriented IG Debt $8.1 Yield Oriented Non IG Debt 0.5 Real Estate Debt / Mezz 3.4 Real Estate Equity 0.4 Amerihome 0.2 Midcap 0.5 Partnerships 1.2 Fixed Income Like 0.3 Natural Resources 0.2 CLO Equity 0.4 AAA Contributed Assets 0.5 Public Positions in Run Off ~70% Private Positions ~30% Total $

16 Overview of Athene s Structure We benefit from long term shareholders who are committed to Athene and have invested capital on multiple occasions Apollo s relationship with Athene is long term focused not structured through a private equity fund with a finite life and short term investment horizon As an insurance holding company, Apollo and its founders (controlling persons) are subject to regulatory oversight No changes are expected to Apollo s relationship with Athene at IPO AGM Apollo (insurance Global holding Management, company) LLC $114 ( Apollo ) billion (Insurance Holding Company) ~$162 billion AUM 45% voting control (2) ; ~10%+ ownership (1) 55% voting control; ~90% ownership Non-Apollo Shareholders And Management Apollo Funds in Equity ~$43 billion AUM Apollo Funds in Credit ~$120 billion AUM Athene Asset Management Onshore & Offshore Insurance Subsidiaries Investment Management Agreement Note: Apollo AUM figures as of 6/30/2015. Please refer to Apollo Global Management, LLC s last periodic report, which is publicly available at for the definition of Assets Under Management or AUM (1) The approximate 10%+ ownership reflects projected expected economic ownership from receipt of shares upon realization of carried interest from AP Alternative Assets L.P. ( AAA ), and other transactions. If the realization of carried interest and other transactions are settled in cash instead of shares, the ownership percentage could be lower. (2) Class B shares own 45% voting rights in aggregate. Apollo votes the entire Class B block as a fiduciary. 16

17 Strong Capital Position and Financial Flexibility We are well capitalized, which provides a competitive advantage and is instrumental for future rating actions Opportunistically holding excess capital to take advantage of dislocations No financial leverage; no surplus notes; no meaningful economic exposure to captives (1) GAAP Financial Leverage Ratio vs. Peer Averages (Debt / Total Capital) Q Athene Holding Consolidated % Annuity Monoline Peer Average (2) 21.5% Large Diversified Peer Average (3) 30.1% Athene USA Risk Based Capital (Company Action Level RBC) 529% 506% 472% 380% ALRe Bermuda Solvency Capital Requirement (BSCR) 4 193% 197% 261% N/A N/A YE 2014 Q AUSA RBC Monoline Peer Average (2) Large Diversified Peer Average (3) YE 2013 YE 2014 Q (1) Athene assumed one captive, Athene Re IV, in connection with the acquisition of Aviva USA. The captive supports the AmerUs Regulatory Closed Block and is backed by an LOC from a A+ rated Bank and has stop loss backing by Global Atlantic (2) Monoline peer average includes American Equity and Fidelity & Guaranty. RBC is disclosed annually. (3) Large Diversified Peer Average includes companies that aren t necessarily comparable due to line of business differences. Diversified Peers include Prudential, Principal, Lincoln, Unum, Torchmark, Genworth, CNO, Primerica, Stancorp and Symetra,. RBC is disclosed annually. (4) BSCR has been adjusted for anticipation of future regulatory changes. The BSCR model provides a method for determining an insurer s capital requirements by taking into account the risk characteristics of different aspects of the insurer s business. The BSCR formula establishes capital requirements for fixed income investment risk, equity investment risk, interest rate risk, premium risk, reserve risk, credit risk, and operational risk. For each category, the capital requirement is determined by applying factors to items such as assets, premiums, reserves and amounts at risk with higher factors applied to items with greater underlying risk and lower factors for less risky items. The minimum requirement is 100% and Athene targets maintaining a minimum ratio of 150% internally. 17

18 Accomplished and Proven Management Team Name Jim Belardi Chairman, CEO and CIO, Athene Holding Bill Wheeler President, Athene Holding Grant Kvalheim CEO, Athene USA Marty Klein (1) CFO, Athene Holding Experience Prior to founding Athene and AAM, President of SunAmerica Life Insurance Company and Chief Investment Officer of AIG Retirement Services, Inc Substantial industry experience as well as a demonstrated track record For the past 4 years acted as the President of Americas at MetLife Inc., prior to this role he led MetLife s Finance and Accounting organization as the Executive Vice President and Chief Financial Officer from 2003 to 2011 Prior to joining Athene, Co President of Barclays Capital from September 2005 until the end of 2007 Joined Barclays in 2001 as Global Head of Credit Products and assumed responsibility for Investment Banking in late 2001 Prior to joining Athene, Chief Financial Officer at Genworth Financial from 2011 until October In addition to leading Finance, Marty also previously served as Acting CEO and President of Genworth Years of Experience Guy (Chip) Smith President, Athene USA Steve Cernich EVP Corporate Development, Athene Holding Thomas Daula Chief Risk Officer, Athene Holding Prior to joining Athene, President and Chief Executive Officer of Liberty Life and affiliated companies from April 2010 until its acquisition by Athene in April 2011 and before that, Vice President, Treasurer and Chief Financial Officer. Prior to joining Athene, Chief Risk Management Officer and Executive Vice President for Capital Assurance Corporation Prior to joining Athene, Chief Risk Officer for UBS Investment Bank from June 2008 until 2011 and Morgan Stanley from April 2005 until February 2008 Mike Downing Prior to joining Athene, worked at Allstate from 2008 to 2014 as Vice President and subsequently Chief Actuary, Athene Holding (2) Senior Vice President of Inforce and Risk Management (1) Marty will start as CFO of Athene Holding on November 9, 2015 (2) Mike was previously Chief Actuary of Athene USA, but will be Chief Actuary of Athene Holding effective December 9,

19 Our Path to Growth Increasing Market Demand Growing aging population Demand for tax efficient products Increased competition across the market requires a unique corporate business model to grow and capitalize on the long term macro trends Our Competitive Advantage Ideal multi channel distribution platform to capitalize on market trends Best in class fixed annuity underwriting & investment capabilities Accomplished M&A model Industry leading mangement team Efficient platform to underwrite incremental business at minimal cost Strong, well capitalized balance sheet with no financial leverage Relationship with AAM, as well access to Apollo, both providing extensive asset management expertise Plan for Growth Continue organic growth by expanding retail, flow reinsurance and institutional channels Target run rate ROE of 15%+ Extend & expand into other spread based products Pursue attractive acquisitions and apply our proven asset redeployment strategy Expand international presence Leverage our unique relationship with Apollo & AAM to achieve superior returns Capitalize on market dislocations to source attractive investment opportunities Maintain risk management discipline We believe we are well positioned for sustained growth, and our efficient platform is designed for future balance sheet growth and asset optimization to translate directly into incremental earnings Note: see target return disclaimer on page 2. 19

20 Overview of Athene s Liabilities

21 Opportunistic Acquirer of Liabilities Total Annuity Sales in the U.S. ($ in billions) Legacy insurance companies saddled by expensive product written in the early 2000s and unable to generate adequate returns against these liabilities as interest rates collapsed We entered the market at a favorable point in the cycle, allowing us to acquire liabilities at a discount to book value and aggregate funding at an attractive cost (due to low marked cost of the liabilities) $120 $100 $80 $60 $40 $20 $89 $75 $14 $88 $65 $80 $53 $78 $53 $73 $48 $109 $111 $23 $27 $25 $25 $27 $30 $32 $82 Athene Inception We have taken advantage of the current interest rate environment to source a long term, low cost, surrender protected liability portfolio $81 $82 $80 $50 Acquired Investors Insurance Acquired Liberty Life Indexed Fixed 10 Year Treasury $48 $32 Acquired Presidential Life $72 $38 $34 Acquired Aviva USA $85 $46 $39 $96 $48 $48 6% 5% 4% 3% 2% 1% 0% 10 Year Treasury Rate Source: LIMRA. 21

22 Overview of Athene s Liability Philosophy Conservative underwriting strategy focused on sourcing low cost, stable policyholder obligations we are focused on profitability rather than volume or market share growth We have been able to acquire liabilities at a discount to book value and use part of this discount to subsidize the cost of reserves (assets received > liabilities assumed) Similar to being paid a premium to assume a bond like obligation Attractive cost of funding allows us to be opportunistic and disciplined in our investment philosophy We have developed various mechanisms to source attractive liabilities: Write capital efficient retail product and issue funding agreement backed notes at today s low rates Acquire businesses at a discount to book value (assets received > liabilities assumed) Reinsurance in which cedant pays Athene (assets received > liabilities assumed) 22

23 Overview of Athene s Cost of Liability Key Liability Statistics Cost of Funds (1) Weighted Avg Life Protected by MVAs Protected by Surrender Charges 2.7% 9.8 years 71% 84% Cost of Policyholder Obligations Pay Down Example Insurance Co. A $10 Negative Cede Par Value ("Account Value") 5 Years $100 $110 Coupon 5.0% 5.0% Cost of Obligation 5.0% 2.8% Conservative underwriting with a focus on profitability Note: All data as of 6/30/15 unless otherwise noted. (1) YTD 6/30/15. Defined as GAAP cost of crediting, GAAP DAC/DSI/VOBA amortization, GLWB and GMDB change in reserves, and other divided by average GAAP reserves. Does not fully reflect the benefit of acquiring liabilities at a discount. 23

24 Our Approach to Retail Distribution We have focused on developing capabilities to directly originate attractive retail product Historical Retail Volumes ($ billion) Retail Philosophy 1 Ease of Doing Business 4 Long Term Relationships Retail Focus Points 2 Competitive Products 3 Competitive Compensation 24

25 Department of Labor Rule Status The Department of Labor is moving forward with proposed rulemaking requiring certain financial advisers to abide by a fiduciary standard, including those that sell annuities to qualified plans We are closely following the proposed new rule given the uncertainty created for our producers selling annuities into IRAs. If the rule is adopted, our distribution partners will be subject to new disclosures and requirements with which they must comply and those requirements will place additional burdens on their operating models Like others in the industry, we believe the rule as proposed creates ambiguities and uncertainty and hope the DOL provides greater clarity on the requirements when it releases the final rule If the rule is adopted, in whatever form, we will be prepared to help producers meet any new requirements that are imposed by the rule. The guarantees and downside protections offered by our products are important to consumers and are a needed component of their retirement planning 25

26 Funding Agreement Backed Notes ( FABN ) FABN provide another attractive source of long term funding for Athene s spread based business model Our 2015 ratings upgrade to A opened access to the funding agreement backed note market Funding agreement backed notes are highly predictable liabilities with defined tenors and no ability to surrender prior to maturity Additionally, funding agreement backed notes provide an attractive cost of funds for Athene Earlier this month, we priced our inaugural $250 million 3 year issuance and will look to opportunistically access the market going forward Proceeds used to purchase investment assets consistent with our existing investment guidelines and in allocations similar to existing portfolio Assets subject to the same cash flow testing, asset liability management (ALM) and other risk management procedures as embedded in the rest of our business We believe the highly predictable and low cost nature of funding agreement backed notes will allow us to invest issuance proceeds in a high quality investment portfolio to generate target returns without stretching for yield 26

27 Our proven M&A model We have successfully closed 5 major transactions totaling over $60 billion in acquired assets Acquired assets over time (1) ($ in billions) $45.5 Weighted average transaction P/B multiple of ~0.6x (2) With each acquisition comes our ability to strengthen operations, redeploy assets into higher yielding products and offer expanded products to customers Across each of these acquisitions, Athene has established itself as a go to acquirer with the capability to underwrite, integrate, and gain regulatory approval for complex deals 2 1 $5.3 $1.5 $3.8 3 $3.9 4 $0.0 5 $ Date Acquired Company Location Current Athene Name Former Parent Company April 2011 Liberty Life Insurance Company South Carolina Athene Annuity & Life Assurance Company Royal Bank of Canada July 2011 Investors Insurance Company Delaware Athene Annuity & Life Assurance Company SCOR December 2012 Presidential Life Insurance Company New York Athene Annuity & Life Assurance Company of NY Public Company October 2013 Aviva USA Iowa / New York Athene USA Aviva plc October 2015 Delta Lloyd Deutschland Germany Athene Germany Delta Lloyd (1) The acquired assets indicated are equivalent to the U.S. GAAP Investments at the time of acquisition as reported in the Business Combinations footnotes from the respective audited financial statements. The Aviva USA investments have been adjusted by ~$10 billion and the Liberty Life investments have been adjusted by $1.1 billion in order to reflect the life business reinsured to Global Atlantic and Protective immediately following the acquisition. (2) Represents purchase price (net of any ceding commissions) at time of transaction announcement, divided by bluebook C&S plus AVR at time of transaction announcement. Excludes Athene Germany. 27

28 Update on Aviva Acquisition In October 2013, we closed on our transformative acquisition of Aviva USA We retained ~$45 billion of fixed annuities and reinsured Aviva USA s ~$10 billion life insurance portfolio to a third party Solidified our company as a go to acquirer capable of underwriting, executing and gaining regulatory approval for complex transactions The Aviva USA transaction has been transformative for us along several fronts: Liabilities: long term, low cost liability portfolio protected by market value adjustments and surrender charges Assets: opportunity to capitalize on our asset management expertise to redeploy a sub optimal portfolio Platform: scalable retail franchise with the infrastructure to write $7 billion+ of product annually Scale: we are now one of the largest fixed annuity platforms in the U.S. Destination for top tier insurance talent Scaled platform with the ability to onboard incremental business without significant incremental cost Operational integration efforts are now complete All retail products written under one Athene brand Consolidated material U.S. offices to West Des Moines, IA headquarters 28

29 Overview of Athene s Investment Portfolio

30 Investment Philosophy Sourcing low cost, stable liabilities is the foundation for an asset management strategy that doesn t require stretching for yield Allows us to be patient, disciplined and opportunistic in our asset allocation Investment portfolio managed by Athene Asset Management (AAM), a subsidiary of Apollo founded for the express purpose of providing a full suite of asset and portfolio management services to Athene Downside focused asset allocation informed by rigorous stress testing and risk philosophy Focus on underwriting liquidity and complexity risk rather than incremental credit risk Athene s Portfolio as of 6/30/15 GAAP Peer Portfolios 1 CMBS Alterna ves 4% 6% Mortgage Loans 10% RMBS 13% ABS & CLO 14% Corporate & Gov't 49% Cash & Equivalents 4% Policy Loans & Other 1% ABS & CDO / CLO 4% Alts, Equities & Other 6% Mortgage Loans 9% Cash CMBS RMBS 3% 3% 4% Policy Loans 2% Corporate and Gov't 68% (1) Peers include Prudential, MetLife, Aflac, Ameriprise, Hartford, Principal, Lincoln, Unum, Torchmark, Genworth, CNO, Primerica, Stancorp, Symetra, American Equity and Fidelity & Guaranty. 30

31 Athene s Strategic Relationship with AAM Athene Asset Management ( AAM ) is a dedicated subsidiary of Apollo founded to provide a full suite of asset and portfolio management services to Athene, including: Asset allocation Risk management Hedging Portfolio management ALM management M&A asset diligence AAM manages 100% of Athene s assets, of which it directly invests ~75% with its in house investment team (primarily into investment grade credit and other structured assets) Through its strategic relationship with AAM, Athene also benefits from access to Apollo s: Infrastructure: Apollo provides support to AAM in tax, risk, legal, compliance, and finance, among several other areas. Access to Apollo s infrastructure has been a significant driver of Athene s ability to profitably scale its business Investment Professionals: AAM professionals have full access to Apollo s 300+ investment professionals around the globe AAM has hired Apollo to sub advise specific asset classes that require unique sourcing or underwriting capabilities (~25% of Athene s portfolio as of June 30, 2015). Sub advisory mandates are dependent on market opportunities, level of service, and risk adjusted performance 31

32 Investment Portfolio Composition Ending GAAP Book Value June 30, 2015 % of Invested Assets Net Earned Rate 1 Credit 33, % 3.94% Corporates 28, % 3.70% Collateralized loan obligations 4, % 5.31% Real Estate 16, % 4.66% Residential mortgage backed securities 7, % 4.84% Mortgage loans 6, % 5.32% Commercial mortgage backed securities 2, % 2.61% Other 8, % 4.85% Asset backed securities 3, % 4.24% Alternatives 3, % 5.48% State, municipals, and policital subdivisions 1, % 5.29% Equity Securities % 1.66% U.S. government and agencies % 0.74% Cash and equivalents 2, % 0.06% Policy Loans and Other % 1.33% Total Invested Assets 60, % 4.10% Athene maintains a highly liquid portfolio to enable it to opportunistically capitalize on market opportunities as they arise We continue to see strong performance in our holdings of residential mortgage backed securities, mortgage loans and collateralized loan obligations Athene evaluates the performance of its alternatives portfolio relative to its targeted returns. Athene underwrites downside protected alternatives to returns of 10% 15% over the long term. Alternative assets generated net yields of 24.3% in 2012, 24.9% in 2013, 9.3% in 2014 and 5.5% in the YTD 6/30/15 period (16% average from 2012 YTD 2015, in line with underwriting targets) Floating rate assets Athene holds ~28% of total invested assets in floating rate securities; these assets have generated less income than anticipated at the time of the 2014 private placement given the prolonged low rate environment We continue to see opportunities in residential mortgage backed securities based on improving fundamentals of falling unemployment & strong housing data, combined with limited impacts from global macro issues Note: past performance is not indicative of future returns. (1) Net Earned Rate is annualized and is calculated based on Average GAAP Book Value of $59,986M at 6/30/2015 YTD; Yields are net of asset mangement and sub advisory fees 32

33 Athene s High Quality Portfolio Athene Portfolio Snapshot Athene Portfolio Mix by NAIC Rating 2 6% 94% Athene opportunistically targets allocating 5% 10% of its portfolio to downsideprotected alternatives NAIC 4, 5, 6 2% NAIC 3 6% NAIC 2 36% Other (Alts/ Equities) 6% NAIC 1 51% Average NAIC Rating: 1.8 Non Alts Alts 9.6 bps Attractive Credit Profile: OTTI as a % of Avg. Invested Assets Peer Average: 6.6 bps 5.5 bps 4.7 bps Athene Average: 1.3 bps 0.4 bps 1.0 bps 2.5 bps YTD 2015 Athene Peer Average¹ (1) Peers include Prudential, MetLife, Aflac, Ameriprise, Hartford, Principal, Lincoln, Unum, Torchmark, Genworth, CNO, Primerica, Stancorp, Symetra, American Equity and Fidelity & Guaranty. Represents weighted average. (2) CML mapped to NAIC ratings based on underlying capital charges. CMLs designated CM1 and CM2 are included with NAIC 2 assets, CMLs designated CM3 and CM4 are included with NAIC 3 assets, and CMLs designated CM6 are mapped to NAIC 6. For average calculation, alternatives and equities mapped to NAIC 6. 33

34 Aviva Redeployment: Actual vs. Expected Capitalizing on its asset management expertise to redeploy the acquired Aviva portfolio was a key value driver for Athene when it underwrote and closed the Aviva USA acquisition Since closing the Aviva transaction, Athene has redeployed $13bn of the Aviva Fixed Income and Other portfolio (excl. alternatives) at an average net book yield of 4.98% (3) (4) and has redeployed $18 billion (2)(3) across all Athene portfolios RMBS 1% CMBS 7% Aviva Portfolio: Closing Alts 1% CML 12% Other (1) 6% Corporates 72% Aviva Portfolio: 6/30/15 Capital Raise Projections ABS 3% RMBS 7% CMBS 2% CLO 6% Aviva Portfolio: 6/30/15 Actual Acquired Portfolio Net Earned Rate (3) 3.44% 3.99% 4.03% Deployment Volumes (3) NA $7,400 $13,101² Average Redeployment NA 5.41% 247bps 4.98% Net Yield (3) excess yield 5 Year Swap NA 2.94% 1.79% Alts 5% CML 16% Other (1) 5% Corporates 56% Corporates 54% Note: past performance is not indicative of future returns. (1) Other includes Munis, Bank Loans, EM, Convertible Bonds, Equity, Treasuries, Cash & Other. (2) Excludes short WAL / short duration. (3) Includes Fixed Income and Other portfolio only; rates net of management fees & sub advised fees. (4) Yields are based on underwritten projections at the time of purchase. Yields on floating rate securities are based on the forward interest rate curve for similar maturity at the time of purchase. CLO 6% RMBS 11% ABS 5% CMBS 4% Aviva Fixed Income and Other Portfolio Metrics (excl. Alternatives) Alts 3% Other (1) 6% CML 11% 319bps excess yield 34

35 Approach to Alternative Investments Athene s allocation to alternatives targets opportunistic investments that offer attractive risk rewards typically due to sector/market dislocations or structural change Target returns in the 10% 15% range over the long term Preferred Alternatives Characteristics Funds that are credit like and produce income over funds that are equity like and rely on capital appreciation Diversification by opportunity rather than diversification for the sake of diversification Funds with high degree of co investment versus pure funds or vehicles that charge fees on undrawn capital Investments that pull to par or have reduced volatility versus pure equity Some element of downside protection or hedge versus pure directional bet Avoid binary outcome investments Athene attempts to defensively position its alternatives portfolio such that it will outperform in normal and bear markets, and slightly underperform in strong equity markets willingness to trade outsized upside for downside protection Athene s largest two alternative positions are investments in asset origination engines which were founded by Apollo, both of which provide Athene with additional exposure to assets that are favorable to insurance companies: Amerihome, a platform to originate residential mortgage loans and MSRs Midcap FinCo, a leading originator of senior debt capital in the middle market with expertise in asset backed, real estate and leveraged loans Note: see note regarding target returns on slide 1 35

36 40 % 30 % 20 % 10 % 0 % % % % % 0.00 % Overview of Athene s Alternatives Portfolio Portfolio Composition Natural Resources / Other Real Assets 6% Legacy Private Equity 10% Public Equity 10% Real Estate & Mortgage 10% Midcap & AmeriHome 19% Legacy Hedge Funds 2% Credit Funds 44% Key Considerations: Credit Funds: credit and credit like investment funds MidCap & AmeriHome: asset origination engines Mortgage & Real Estate: funds that invest in real properties, mortgages, or mortgage related investments Public Equities: run off positions from AAA contribution to pre fund Aviva USA acquisition Legacy Private Equity: Remaining non public investments from AAA contribution and structured equity funds Legacy Hedge Funds: primarily run off positions inherited from the Aviva USA and Presidential acquisitions Historical Alternatives Portfolio Performance Athene s alternatives portfolio has returned an average of 16% from 2012 YTD 6/30/15, slightly in excess of Athene s 10% 15% long term underwriting targets 24 % 25 % Average: 16% 9 % 6 % 15% 10% Avg. Alt. Assets /30/2015 YTD Alternatives Return $1,195M $2,723M $3,697M $3,481M Note: past performance is not indicative of future returns (1) Based on simple average. 14% on a weighted average basis. 36

37 Alternative Investment Performance in Context Consistent with our downside focused philosophy, we have positioned our alternatives portfolio to outperform relative benchmarks in periods of market volatility Athene Alternatives vs. Key Benchmarks 24.3% 24.9% 32.4% Relative outperformance in market volatility * 16.0% 15.6% 7.4% 9.3% 13.7% 2.5% 5.5% 0.1% (2.9)% YTD 2015 Athene Alternatives S&P 500 High Yield Historical Portfolio Performance 45.8% 46.6% 24.3 % 24.9 % 19.8% Period Average: AAA: 26% Non AAA: 12% Total: 16% 12.2% 7.9% 10.0% 9.3 % 2.2% 6.9% 5.5 % YTD 2015 AAA Non AAA Total Athene Alternatives Note: past performance is not indicative of future returns. See note regarding indices on page 2. *Returns based on reported results from 2 nd quarter 2015 GAAP financials. Performance related to certain alternative assets may be recorded on a monthly or quarterly lag basis, and therefore, results may not be directly compared to the S&P or high yield indices as of the date set forth. 37

38 Net Performance Since 2012 In evaluating our Net GAAP Earned Rates, it is important to consider the impact of: Alternative investment performance: we underwrite alternative investments to a 10% 15% target return over the life of the investment. Given our long term approach to underwriting returns the Company may experience short term volatility in its income statement Floating rate securities: we currently hold ~28% of our portfolio in floating rate securities (in excess of most peers) to manage the interest rate environment and maintain our ALM profile. Given the prolonged low rate environment, yields on our floating rate assets have been lower than targeted at underwriting Aviva mark to market: when we acquired the ~$45 billion Aviva portfolio we marked the assets to market, temporarily lowering yields until our redeployment plan is complete 7.6% Net GAAP Earned Rate vs. Peers 6.4% 5.5 % 4.8% 5.1 % % 5.2 % 5.3% 0.6% 4.5% 4.4% 0.5% 4.4% 4.5% 0.2% 0.2% 0.4% 0.2% 4.3% 4.1% Avg Inv. Assets 2012 $11.6B 2013 $26.2B 2014² $59.7B YTD 2015³ (Annualized) $60.0B 2012 YTD 2015 Average Athene Peer Average¹ Impact of Floating Rate Sec. Athene Yield with Alternatives at 12.5% 4 Impact of Aviva MTM Note: past performance is not indicative of future results. (1) Peers include Prudential, MetLife, Aflac, Ameriprise, Hartford, Principal, Lincoln, Unum, Torchmark, Genworth, CNO, Primerica, Stancorp, Symetra, American Equity and Fidelity & Guaranty. (2) Athene s net yields in 2014 were impacted by: (1) volatility in Athene s alternatives portfolio; (2) the decision to hold a significant part of Athene s portfolio in floating rate assets; and (3) the mark to market on Aviva s investment portfolio at transaction close. (3) Athene s net yields in 2015were impacted by: (1) volatility in Athene s alternatives portfolio; (2) the decision to hold a significant part of Athene s portfolio in floating rate assets; and (3) the mark to market on Aviva s investment portfolio at transaction close. (4) Alternatives are underwritten to a targeted 10% 15% return (5) Athene 2012 YTD 2015 Average is based on yields reflecting adjustments for Alternatives at 12.5%, impact of holding Floating Rate securities, and Impact of Aviva MTM at each period shown 38

39 Investment Deep Dive: MidCap FinCo ( MidCap ) Attractive investment generating mid teens returns with potential for significant future flow of syndicated loans and other investment opportunities Business Overview Athene owns ~35% of MidCap (1), a leading senior debt capital provider to the middle market focused on the direct origination of asset backed loans, leveraged loans, real estate loans, rediscount loans and venture loans Management team led by industry veterans who previously founded Merrill Lynch Capital Partners and held executive positions at GE Capital and Heller Financial Originated ~$22 billion of commitments over the past decade with less than 20bps of annualized loan losses Robust in house loan origination and portfolio management infrastructure with proven proprietary origination capabilities and deep industry expertise Diverse portfolio of ~$7 billion in funded assets (pro forma for the Mubadala GE Capital portfolio acquisition) Favorable financial profile with attractive risk adjusted returns Seeks to produce mid teens ROEs with leverage of ~ x asset to equity in today s market Current income through quarterly dividends Opportunity to capture franchise value through incremental scale Positioned to benefit from continued regulatory change Headquartered in Bethesda, MD with 105 professionals in 6 offices across the U.S. See note regarding target returns on page 2 (1) Athene s ownership stake is anticipated to drop to ~20% pro forma for the Mubadala transaction. Diverse Spectrum of Target Asset Classes Legacy MidCap Healthcare ABL Healthcare Leveraged Lending Healthcare Real Estate Healthcare Venture Lending Current Growth Opportunities General ABL General Leveraged Lending General Real Estate Unitranche Loans Lender Finance / Rediscount Lending Improving Market Environment General Electric Co. has decided it no longer needs to be a bank. Wall Street Journal, April 10, 2015 Citing increasing regulatory burdens, GE plans to exit the bulk of its $500 billion finance business GE Capital represents the 7 th largest bank in the US Exit expected to occur over the next 24 months Significant opportunity for MidCap to acquire assets and capture market share with GE Capital s departure 39

40 Investment Deep Dive: AmeriHome Residential Credit Origination Platform Business Overview Funded by Athene and an Apollo managed credit fund in 2013 to originate loans and retain mortgage servicing rights Athene currently owns ~75% of AmeriHome AmeriHome purchases ~$2bn of residential mortgage loans each month in 49 states and the District of Columbia AmeriHome then sells / securitizes the loans, primarily through FNMA, FHLMC, and GNMA AmeriHome has originated ~$80m of Non Agency loans for Athene to date Backed by $500m of capital commitments from Athene, Apollo s COF III, and management, with mid teens to low twenties return targets 1 Headquartered in Woodland Hills, CA (North of LA) In Two Years, AmeriHome Has Become the Third Largest Non Bank Correspondent Lender Lock Volume Growth To Date (millions) $175 $248 $353 $366 $538 $606 $939 $1,370 $1,418$1,469 $2,050 $2,081$2,137 $1, Strong Service Quality Key Investment Highlights Industry leading cycle times: less than 7 days from lock to funding 2. High Quality Origination Diversified, innovative product offering. 98.7% current portfolio, average FICO of Highly Flexible Expense Structure Technology, efficient outsourcing drive efficiency: $2bn of origination with ~200 FTEs 4. Industry Leading Loan Level Analytics Simpler version of model sold to three institutional buyers 5. Robust Servicing Oversight Without Intensive Operations Experienced and lean team oversees outsourced subservicing 6. Bank like Focus on Compliance Risk practice fueled by compliance prioritization 7. Proven Management Team Seasoned team, 20+ years experience, led by Jim Furash, ex CEO of Countrywide Bank 8. Attractive Financial Returns ~20% ROEs: ~40% on origination and ~8% on MSRs Business Breakdown September 2015 UPB ($13.7bn) Investor Type Loan Purpose Type Non Agency 1% FHLMC 23% FNMA 25% GNMA 51% Cash Out Refi 13% No Cash Out Refi 24% Purchase 63% (1) Following approval of additional commitments by appropriate Insurance regulatory authorities. (2) Represents % current and average FICO excluding legacy AmeriHome portfolio (<5% of total MSR BV). 40

41 Overview of Capitalization & Risk Management

42 Rigorous Approach to Risk Management Athene and its subsidiaries believe they have a sound governance structure to implement comprehensive risk management in every aspect of Athene s business Credit Spreads: Corporate, real estate Policyholder Behavior: Lapse, income rider utilization Key Risks Interest Rates Liquidity Risk Enterprise risk management Hedging and derivatives Internal Risk Management Framework Asset / liability management legal entity level and economic entity level Risk analytics and asset modeling Extensive internal downside risk assessment and testing: Scenario Analyses: show capital levels are sufficient to withstand even substantial economic disruptions, such as the failure of a major financial institution (e.g. Lehman) or a recession Cash Flow Testing: since inception, Athene has passed cash flow testing for all material entities without requiring additional reserves despite relatively large moves in interest rates Stress Tests: show interest rate risk is well contained with substantial rises and declines in rates resulting in relatively modest realized losses. Entire asset portfolio is run under severe stress scenarios on a monthly basis and presented to senior management by risk and investment professionals to monitor and set risk policy 42

43 Robust Liquidity Monitoring Liquidity limits are set to ensure Athene and its subsidiaries have adequate liquidity to meet their needs across various market environments Cash liquidity is closely monitored against the following internal limits Immediate cash liquidity limit Limit set such that liquidity balances exceed near term cash needs Intermediate cash flow liquidity limit Asset cash flows to cover liability cash flows over 1 year in a stress scenario Asset stress liquidity limit Ability of Athene Life Re to meet collateral calls under reinsurance contracts in a Lehman type event Liability stress liquidity limit Maintain assets that can be liquidated in one quarter under normal market conditions sufficient to meet potential cash requirements for portion of Athene s policyholder obligations which are liquid 43

44 Athene: Key Risk Checklist Athene executes on its business strategy within the boundaries of the key risks approved by its Board of Directors and Overseen by its Risk Committee Key Limit Asset Liability Duration Mismatch Liquidity Limits Capital Solvency Analysis Stress Scenario Asset Class Concentration Single Issuer Concentration Shock Lapse Sensitivities Cash Flow Testing Analysis Description Monitor asset liability duration mismatch to ensure Athene operates within the parameters set by its Board of Directors Monitor liquidity position on a daily basis to ensure compliance with limits set forth on prior page Target maintaining an unchanged financial strength rating under moderate stress events (1 in 10 year event) and above investment grade financial strength rating under a substantial stress event (1 in 25 year event) Define and monitor concentration limits by asset class on an ongoing basis Define and monitor maximum single issuer exposure limits based on issuer category/rating on an ongoing basis Monitor lapse sensitivity as related to changes in the interest rate environment Ensure the Company s asset cash flows are sufficient to meet liability outflows under a range of interest rate scenarios 44

45 Commitment to Strong Ratings Recent rating upgrades and improvements in outlook are testaments to Athene's strong credit profile Based on an in depth look at our financials, performance, capital position, liquidity, assets, liabilities, ALM and risk, what the agencies say about us: Superior management team with extensive experience Strong financials and capital, with a proven ability to grow capital Athene s Rating Profile Rating Agency Rating Outlook A.M. Best 1 A (excellent) Stable S&P 2 A (strong) Stable Fitch 3 A (strong) Stable 1 Financial strength ratings for all members of Athene Group including Athene Annuity & Life Company. A.M. Best Company s Financial Strength Rating (FSR) reflects A.M. Best Company s assessment of the relative ability of an insurer to meet its ongoing insurance policy & contract obligations. 2 Financial strength ratings for all members of Athene Group including Athene Annuity and Life Company. S&P s credit ratings express their opinion about the ability and willingness of an issuer to meet its financial obligations in full and on time. 3 Financial strength ratings for Athene Annuity & Life Assurance Company, Athene Annuity and Life Company, Athene Annuity and Life Assurance Company of New York and Athene Life Re Ltd. The IFS Rating is assigned to the insurance company's policyholder obligations, including assumed reinsurance obligations and contract holder obligations, such as guaranteed investment contracts. The IFS Rating reflects both the ability of the insurer to meet these obligations on a timely basis, and expected recoveries received by claimants in the event the insurer stops making payments or payments are interrupted, due to either the failure of the insurer or some form of regulatory intervention 45

46 Financial Overview

47 Earnings Model: Net Investment Income Our primary source of revenue is the income we generate on our high quality investment portfolio Due to the low cost of our liabilities, we do not have to stretch for yield in our investment portfolio to generate target returns, and can be patient, opportunistic and disciplined in our asset allocation 87% of total portfolio rated NAIC 1 or 2 (1) and 94% of fixed income investments rated NAIC 1 or 2 (highest designation) ~28% of portfolio allocated to floating rate assets to manage interest rate environment and maintain ALM profile 6% of the portfolio allocated to alternatives focused on downside protection Portfolio maintains enough liquidity to opportunistically capitalize on market dislocations Net Investment Income $621 $630 $604 $96 $88 $31 $708 $128 $608 $622 $53 $43 $525 $542 $573 $580 $555 $579 1Q Q Q 2014* 4Q 2014* 1Q Q 2015 $ in Core Fixed Income $ in Alts Core Fixed Income NIER 3.73% 3.88% 4.11% 4.16% 3.96% 4.07% Alts NIER 9.83% 9.56% 3.50% 14.59% 6.04% 5.01% Total NIER 4.13% 4.23% 4.08% 4.78% 4.09% 4.12% *Q and Q Non Alts NIER is favorably impacted by significant call income and mortgage prepayment fee income (1) CML mapped to NAIC ratings based on underlying capital charges. CMLs designated CM1 and CM2 are included with NAIC 2 assets, CMLs designated CM3 and CM4 are included with NAIC 3 assets, and CMLs designated CM6 are mapped to NAIC 6. 47

48 Earnings Model: Cost of Funds Our long duration, surrender protected book of liabilities has an attractive cost of funds, which consists of the following components: Highly stable core cost of crediting, which represents the cost to Athene of funding interest credits on policyholder obligations Amortization of deferred acquisition costs (DAC), deferred sales inducements (DSI), and value of business acquired (VOBA) Other, which consists primarily of changes in the present value of Athene s guaranteed lifetime withdrawal benefit (GLWB) and guaranteed minimum death benefit (GMDB) riders Cost of Funds 257 bps 267 bps 279 bps 243 bps 258 bps 260 bps 80 bps 78 bps 65 bps 73 bps 92 bps 87 bps 21 bps 30 bps 35 bps (1bps) 29 bps 34 bps 194 bps 197 bps 198 bps 195 bps 194 bps 189 bps 1Q Q 2014¹ 3Q Q Q Q Cost of Crediting DAC/DSI/VOBA Amortization Other Note: Components above not additive due to Cost of Crediting expense is calculated over the average account value on our deferred annuities and DAC/DSI/VOBA amortization and Other are calculated taking the costs over the total average reserves. For total Cost of Funds, bps are calculated on total average reserves. (1) 2Q2014 bar excludes $2 positive impact of DAC/DSI/VODA amortization, total includes it. (2) The DAC/DSI/VOBA amortization and other line includes the amortization and change in GLWB and GMDB reserves for all products as well as the cost of funds on products other than deferred annuities. The rate is calculated taking the costs over the average reserves. (3) The cost of crediting is on our deferred fixed annuity block of business, which makes up approximately 86% of our total reserves. Cost of crediting is the fixed interest credited to policyholders and the indexed option costs on our core deferred annuities. The rate is calculated taking these costs are over the average account value of our deferred annuities. 48

49 Earnings Model: G&A Athene has designed its platform to provide significant operating leverage and to provide the ability to onboard future business with very little incremental operating costs Efficient platform allows for high flow through of incremental net spread to incremental earnings Athene targets 40bps of G&A expense as a percent of average invested assets G&A % of Average Invested Assets 32 bps 42 bps 40 bps 29 bps 34 bps 45 bps Q Q Q Q Q Q * *Q includes $13M of stock compensation expense; if excluded, G&A expense would be 36bps. 49

50 Earnings Model: Tying it All Together Against its long term, low cost book of liabilities, Athene has matched a high quality investment portfolio, resulting in a significant and long term earnings stream Due to the stable and predictable nature of our funding costs and expense base, new business growth and the rate we earn on our investment portfolio will be the primary drivers of our financial performance going forward High Level GAAP Business Model and Financials As Reported ($ millions) (4) YTD 6/30/2015 (4) Balance Sheet Invested Assets Alternatives $4,069 $3,569 $3,408 Invested Assets Core Fixed Income 56,528 55,656 57,515 Total Invested Assets $60,597 $59,225 $60,923 Reserves $60,534 $59,867 $60,036 Debt $351 Ending Equity (ex AOCI) $2,667 $3,922 $5,254 Book value per share ex. AOCI As Reported $23.18 $27.81 $28.30 Income Statement ($ & bps) $ bps (1) $ bps (1) $ bps (1) Net Investment Income Alternatives $ % $ % $96 5.5% Net Investment Income Core Fixed Income 1, % 2, % 1, % Net Investment Income $1, % $2, % $1, % Core Cost of Crediting (2) ($495) (2.4%) ($946) (2.0%) ($467) (1.9%) Other (266) (1.0%) (594) (1.0%) (344) (1.1%) Cost of Funds ($761) (3.0%) ($1,540) (2.6%) ($811) (2.7%) Net Spread $ % $1, % $ % G&A (160) (0.6%) (212) (0.4%) (118) (0.4%) Operating Income, before tax $ % $ % $ % Operating ROE 35.5% 24.6% 13.1% Rolling 3 Year Average Operating ROE (3) 19.2% 27.3% 24.0% Note: past performance is not indicative of future returns. (1) Bps calculated as income statement metric over average invested assets for all metrics other than cost of funds. Cost of funds bps calculated as cost of funds over average reserves. (2) Bps calculated over average FIA reserves, rather than average total reserves. (3) Calculated from 2013 YTD 6/30/2015 for the YTD 2015 period. (4) In April 2015, Athene drew the remaining $1.1 billion of capital from its 2014 private placement. Assuming that the full amount of the private placement was drawn at the beginning of 2014, 2014 operating ROE would be 19.2% and YTD 6/30/15 operating ROE would be 11.7%. See next page. 50

51 Athene s GAAP Financials: Normalized View Key Considerations Alternative Investments Our opportunistic allocation to alternatives is a key driver of the Company s financial performance We underwrite credit like, downside protected alternatives to 10% 15% target returns. We seek to generate these returns over the life of the alternative investment, rather than on a quarterly basis Given our long term approach to underwriting returns, the Company may experience short term volatility in its income statement which needs to be normalized Normalizing for alternative investment performance, the largest driver of our YTD 6/30/15 financial performance vs. our 2014 financial performance is higher amortization of DAC, VOBA and DSI balances 2014 and YTD 2015 Financials at Various Alternative Returns 2014 YTD 6/30/2015 Alternatives Return Alternatives Return ($ millions) Actual 10.0% 12.5% 15.0% Actual 10.0% 12.5% 15.0% Net Investment Income Alternatives $342 $370 $462 $555 $96 $174 $218 $261 Net Investment Income Core Fixed Income 2,221 2,221 2,221 2,221 1,134 1,134 1,134 1,134 Total Net Investment Income $2,563 $2,590 $2,683 $2,775 $1,230 $1,308 $1,352 $1,395 Cost of Crediting (946) (946) (946) (946) (467) (467) (467) (467) Amortization & Other (594) (594) (594) (594) (344) (344) (344) (344) Total Cost of Funds ($1,540) ($1,540) ($1,540) ($1,540) ($811) ($811) ($811) ($811) Net Spread $1,023 $1,050 $1,143 $1,235 $419 $497 $541 $584 G&A (212) (212) (212) (212) (118) (118) (118) (118) Operating Income, before tax $811 $838 $931 $1,023 $301 $379 $423 $466 Annualized Operating Income, before tax $811 $838 $931 $1,023 $602 $758 $845 $932 Operating ROAE 24.6% 25.3% 27.7% 30.1% 13.1% 16.4% 18.2% 20.0% Operating ROAE Adj. for Capital Draw (1) 19.2% 19.7% 21.6% 22.8% 11.7% 14.6% 16.2% 17.8% Athene targets generating run rate 15%+ ROEs Note: Alternatives returns at 10%, 12.5% and 15% represent management adjustments rather than actual performance. Past performance is not indicative of future returns. See note regarding target returns on page 2. (1) Assumes full $1.3bn of capital was drawn on 12/31/2013 and earns 5% in

52 State of the World: Capital Raise vs. Today Swap Curve The projected swap curve has declined and flattened since the Aviva acquisition Deployment yields for fixed and floating rate assets remain lower than forecasted Income realization on floating rate assets continues to underperform expectations bps 225 bps BBB Corporate OAS Significant periods of spreadtightening post capital raise 4.00 Yields (%) BBB Corporate OAS 200 bps 175 bps bps Mo Mo Mo Mo Mo Yr 2 Yr 3 Yr 4 Yr 5 Yr 7 Yr 9 Yr 10 Yr 12 Yr 15 Yr 20 Yr Actual on 9/30/2015 Projected as of 10/1/ Yr 50 Yr 125 bps Oct 13 Feb 14 Jul 14 Dec 14 May 15 Sep 15 52

53 Redeployment Comparison Cumulative Net Investment Income from Redeployed Assets Cumulative Net Investment Income from Redeployed Aviva Total Portfolio NAIC Composition 2 Fixed Income & Other Assets (excl. Alternatives) 1 Other (Alts/ $700 NAIC 4, 5, 6 Average NAIC $662 Equities) Athene has redeployed Rating: 1.8 2% NAIC 3 6% ~1.75x the volume of fixed income & other 6% $600 Aviva assets anticipated in the 2013/14 private placement $500 $400 $300 $200 $100 Q Q Actual Q Q Q Q Capital Raise Projections $400 Q NAIC 2 36% NAIC 1 51% 6/30/15 average NAIC weighting of 1.8 vs projected in capital raise Total Portfolio Composition: Alts vs. Non Alts 6% ~8% 94% ~92% Current Non Alts Capital Raise Projection (1) Net investment income in each quarter defined as assets redeployed in that quarter multiplied by average net redeployment yield for the quarter. Cumulative net investment income from redeployed assets defined as cumulative earnings on redeployed assets since Q Fixed income and other assets only i.e., excludes alternative investments. (2) CML mapped to NAIC ratings based on underlying capital charges. CMLs designated CM1 and CM2 are included with NAIC 2 assets, CMLs designated CM3 and CM4 are included with NAIC 3 assets, and CMLs designated CM6 are mapped to NAIC 6. For average calculation, alternatives and equities mapped to NAIC 6. Alts 53

54 Athene s Performance: Actual vs. Expected In 2014, Athene materially outperformed the projections presented to private placement investors in 2013/14 Aviva Fixed Income & Other Redeployment Volumes (ex. Alts) (1) 2014 Operating Income (2) $13.1 $811 $7.4 $726 Capital Raise Actual Capital Raise Actual 2014 Operating ROE 2014 Book Value per Share ex. AOCI (3) 19.6 % 24.6 % $ $ Capital Raise Actual Capital Raise Actual Note: past performance is not indicative of future returns. (1) $ billion, as of 6/30/2015. (2) $ million (3) Undiluted for management equity. A large driver of the delta between capital raise and actual BVPS ex. AOCI is share count. Capital raise projections assumed $500 million raised at $25, all of which was drawn at 12/31/14 (151mm shares outstanding). Actual represents $1.3bn offering at $26, 20% of which was drawn at 12/31/14. Pro forma for the remaining draw in April 2015, BVPS would have been $

55 Public Company Readiness: Progress to Date Progress Towards Public Company Readiness Have upgraded and continue to upgrade financial systems Tax material weakness downgraded by management to significant deficiency Management expects to downgrade actuarial material weakness by the end of the year Implemented public company board governance changes Resumed GAAP financial statement production Supplemented our industry leading management team with key hires across the organization including: Bill Wheeler, President: 28 years of insurance and financial services experience Marty Klein, CFO: 32 years of insurance and financial services experience Tom Daula, CRO: 21 years of financial services risk management experience Mike Downing, Chief Actuary: 21 years of actuarial experience Randy Epright, CIO: 25 years of IT and operating experience 55 55

56 Public Company Readiness: Remaining Priorities Management team integration Remaining Public Company Workstreams Marty Klein will be starting as CFO of Athene Holding in early November Creation of an Investor Relations function GAAP financial statement production Adopt ASU (new FASB consolidation guidance) Primary impact will be a reclass between line items on Athene s income statement The cumulative impact on earnings is anticipated to be a favorable impact to equity of less than 0.50% Improve closing cycle efficiency to ensure Athene can adhere with public company reporting timelines We anticipate finalizing our S 1 and filing with the SEC no later than June 30,

57 Growth

58 Flexible Multi Channel Distribution Platform Our platform supports opportunistic origination across market environments, which better enables us to achieve stable asset growth while maintaining strong levels of profitability We evaluate liabilities across each of the below channels based on: (1) the upfront cost of acquiring the liability, and (2) the liability s ongoing cost of crediting Organic Channels Retail Flow Reinsurance Institutional Significant growth driver, with sales through August 2015 of $1.8 billion (1) Provide high quality products and service to our policyholders and maintain appropriate financial protection over the life of their policies Licensed to sell products in all 50 states (2) and the District of Columbia Reinsurance to ALRe from third parties (either directly to ALRe or via Athene's U.S. entities) Reinsure MYGAs, FIAs and payout annuities Opportunistically issue funding agreements to institutional fixed income investors Products are scalable without any ability to surrender prior to maturity Inaugural offering in October 2015 $250 million 3 year issuance Inorganic Channels Acquisitions and Block Reinsurance Demonstrated transaction expertise; we have completed five strategic transactions since formation Target acquiring businesses at a discount to book value and using part of this discount to subsidize cost of liabilities (assets received > liabilities assumed) Target writing capital efficient retail product at today s low rates (1) Represents all money paid into new and existing insurance contracts, including internal transfers (2) Products sold through AANY in the state of New York 58

59 Attractive Opportunity Set Domestic M&A Block reinsurance Legacy Athene Flow reinsurance Retail (IMO, FI) FABN Domestic M&A Block reinsurance Today s Core International M&A Retail (money center banks; wirehouses) Pension buyout Other spreadbased products Flow reinsurance Retail (IMO; FI) FABN Domestic M&A Block reinsurance Tomorrow s Frontier Key Catalysts Global financial crisis Attractive market demographics Prolonged low rate environment Post crisis regulation Ratings Solvency II Ratings Expansion of demonstrated underwriting & investing expertise 59

60 with Significant Near Term Growth Drivers Addressable Markets Opportunity Market Size Presence Today Ratings Requirement Retail Channel Expansion FI ~$135B 2015 Annualized IMO $2.7B Flow Reinsurance $0.7B A /A Funding Agreement Back Notes (FABN) ~$20B YTD $250M A /A Closed Block Reinsurance Significant Opportunistic A Bulk Annuities Reinsurance (U.K.) ~$20B Opportunistic A /A Pension Buyouts (U.S.) ~$10B Future A Domestic M&A Steady Opportunistic N/A International M&A Significant Opportunistic N/A 60

61 Conclusion

62 Athene's Investment Thesis Athene believes it has built an efficient multi channel platform to capitalize on attractive market trends and generate a long term, highly visible earnings stream for its shareholders Highly visible, spreadbased earnings stream Accomplished and proven management team Ideal multi channel platform to source longterm, low cost liabilities Strong, well capitalized balance sheet with no financial leverage Efficient corporate platform to underwrite incremental business at minimal cost Differentiated investment strategy through AAM & Apollo 62