Q2 2026 Corebridge Financial Inc Earnings Call

August 5, 2026

Speaker #1: Hello, everyone. Thank you for joining us, and welcome to the Corebridge Financial, Inc. second quarter 2026 earnings call. After today's prepared remarks, we will host a question-and-answer session.

Operator: Hello everyone. Thank you for joining us, and welcome to the Corebridge Financial, Inc. Q2 2026 earnings call. After today's prepared remarks, we will host a question-and-answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I would now like to hand the conference over to Isil Muderrisoglu, Head of Investor and Rating Agency Relations. Please go ahead.

Speaker #1: If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I would now like to hand the conference over to Isil Muderrisoglu, Head of Investor and Rating Agency Relations. Please go ahead.

Speaker #2: Good morning, everyone, and welcome to Corebridge Financial's earnings update for the second quarter of 2026. Joining me on the call are Mark Costantini, President and Chief Executive Officer; Chris Filliaggi, our Interim Chief Financial Officer; and Lisa Longino, our Chief Investment Officer.

Isil Muderrisoglu: Good morning everyone, and welcome to Corebridge Financial's earnings update for Q2 2026. Joining me on the call are Marc Costantini, President and Chief Executive Officer, Chris Filiaggi, our Interim Chief Financial Officer, and Lisa Longino, our Chief Investment Officer. We will begin with prepared remarks by Marc and Chris, and then we will take your questions. Today's comments may contain forward-looking statements, which are subject to risks and uncertainties. These statements are not guarantees of future performance or events and are based upon management's current expectations and assumptions. Corebridge's filings with the SEC provide details on important factors that may cause actual results or events to differ materially from those expressed or implied by such forward-looking statements.

Speaker #2: We will begin with prepared remarks by Mark and Chris, and then we will take your questions. Today's comments may contain forward-looking statements, which are subject to risks and uncertainties.

Speaker #2: These statements are not guarantees of future performance or events, and are based upon management's current expectations and assumptions. Corebridge's filings with the SEC provide details on important factors that may cause actual results or events to differ materially from those expressed or implied by such forward-looking statements.

Speaker #2: Except as required by the applicable securities laws, Corebridge is under no obligation to update any forward-looking statements if circumstances or management's estimates or opinions should change, and you are cautioned to not place undue reliance on any forward-looking statements.

Isil Muderrisoglu: Except as required by the applicable securities laws, Corebridge is under no obligation to update any forward-looking statements if circumstances or management's estimates or opinions should change. You are cautioned to not place undue reliance on any forward-looking statements. Additionally, today's remarks may refer to non-GAAP financial measures. The reconciliation of such measures to the most comparable GAAP figures is included in our earnings release, financial supplement, and earnings presentation, all of which are available on our website at investors.corebridgefinancial.com. With that, I would like to now turn the call over to Marc and Chris for their prepared remarks. Marc?

Speaker #2: Additionally, today's remarks may refer to non-GAAP financial measures. The reconciliation of such measures to the most comparable GAAP figures is included in our earnings release, financial supplement, and earnings presentation, all of which are available on our website at investors.corebridgefinancial.com.

Speaker #2: With that, I would like to now turn the call over to Mark and Chris for their prepared remarks. Mark?

Speaker #3: Good morning, and thanks for joining us. I'm delighted to be with you today following the successful shareholder vote approving the merger with Equibal. The shareholders’ support of this transaction is a powerful validation of the attractiveness of the combined company.

Marc Costantini: Good morning, and thanks for joining us. I'm delighted to be with you today following the successful shareholder vote approving the merger with Equitable. The shareholder support of this transaction is a powerful validation of the attractiveness of the combined company. We're more confident than ever about the future we're building together. Turning to the Q2 highlights, we delivered strong results consistent with our full year guidance. Core sources of income were up 5% year-over-year. While variable investment income came in below our long-term expectations, our underlying fundamentals remain strong. Our run rate earnings per share were up 16% year-over-year. Consistent with guidance, our adjusted return on equity, excluding VII, was up 90 basis points year-over-year to 10.9%. Our cash generation remains strong.

Speaker #3: We're more confident than ever about the future we're building together. Turning to the second quarter highlights, we delivered strong results consistent with our full-year guidance.

Speaker #3: Core sources of income were up 5% year over year, while variable investment income came in below our long-term expectations, our underlying fundamentals remained strong.

Speaker #3: Our run-rate earnings per share were up 16% year over year. Consistent with guidance, our adjusted return on equity excluding VII was up 90 basis points year over year to 10.9%.

Speaker #3: And our cash generation remained strong. We've now generated cash in excess of $400 million for 14 consecutive quarters, showcasing the strength of our balance sheet and underlying businesses.

Marc Costantini: We've now generated cash in excess of $400 million for 14 consecutive quarters, showcasing the strength of our balance sheet and underlying businesses. In Q2, we returned $412 million of capital to shareholders, including $300 million of share repurchases for a year-to-date normalized payout ratio of 84%. Turning to slide four, our top line performance was resilient. While total company sales were down year-over-year, sales increased sequentially by 13%. Furthermore, on a rolling 12-month basis, which adjusts for seasonal fluctuations and the lumpy nature of the pension risk transfer business, we saw total company sales growth by 4% year-over-year. This is a testament to our product depth and commitment to margin integrity across cycles. Equally important, we excel at allocating capital efficiently.

Speaker #3: In the second quarter, we returned $412 million of capital to shareholders, including $300 million of share repurchases. For a year-to-date normalized payout ratio of 84%.

Speaker #3: Turning to slide 4, our top-line performance was resilient. While total company sales were down year over year, sales increased sequentially by 13%. Furthermore, on a rolling 12-month basis, which adjusts for seasonal fluctuations and the lumpy nature of the pension risk transfer business, we saw total company sales grow by 4% year over year.

Speaker #3: This is a testament to our product depth and commitment to margin integrity across cycles. Equally important, we excel at allocating capital efficiently. Of note, our breadth of distribution enables us to shift between products and businesses to where the risk-adjusted returns are most attractive.

Marc Costantini: Of note, our breadth of distribution enables us to shift between products and businesses to where the risk-adjusted returns are most attractive. In Individual Retirement, we've been a top 5 provider for more than a decade and are the only insurer with a top 10 sales ranking across all annuity products. We continue to prioritize pricing discipline given tighter competition. Conditions improve in the latter part of the quarter as yields rose and sales momentum resumed, making June the strongest sales month of the year. All else being equal, we expect steady sales and positive net flows for the rest of the year. In Group Retirement, our transition from a spread to fee-based business is continuing in line with expectations. In the quarter, our wealth management assets rose to $20 billion, an 18% increase year-over-year.

Speaker #3: In individual retirement, we've been a top five provider for more than a decade, and are the only insurer with a top 10 sales ranking across all annuity products.

Speaker #3: We continue to prioritize pricing discipline given tighter competition. Conditions improved in the latter part of the quarter as yields rose and sales momentum resumed, making June the strongest sales month of the year.

Speaker #3: All else being equal, we expect steady sales and positive net flows for the rest of the year. In group retirement, our transition from a spread- to a fee-based business is continuing in line with expectations.

Speaker #3: In the quarter, our wealth management assets rose to $20 billion. An 18% increase year over year. We continue to see a $30 billion growth opportunity by further capturing IRA rollovers and consolidating household assets within our current customer base.

Marc Costantini: We continue to see a $30 billion growth opportunity by further capturing IRA rollovers and consolidating household assets within our current customer base. As a result of our efforts to improve the customer experience, we are also starting to see an uptick in Group Retirement business wins. In our life business, we've been a top-tier provider of term life for nearly a decade. In the quarter, we delivered run rate earnings above our typical guide, reflecting strong underwriting results. Our sales continued to benefit from our platform that leverages automated underwriting for more than 80% of the new business. Turning to Institutional Markets, the GIC market has grown rapidly over the past 3 years, with Corebridge's reserves nearly doubling over the same time period. In the quarter, we issued $1.8 billion of GICs at attractive IRRs, and we continue to see meaningful opportunities for the remainder of the year.

Speaker #3: As a result of our efforts to improve the customer experience, we are also starting to see an uptick in group retirement business wins. In our life business, we've been a top-tier provider of term life for nearly a decade.

Speaker #3: In the quarter, we delivered run-rate earnings above our typical guide, reflecting strong underwriting results. Our sales continue to benefit from our platform that leverages automated underwriting for more than 80% of the new business.

Speaker #3: Turning to institutional markets, the GIC market has grown rapidly over the past few years, with Corebridge's reserves nearly doubling over the same time period.

Speaker #3: In the quarter, we issued $1.8 billion of GICs at attractive IRRs. And we continue to see meaningful opportunities for the remainder of the year.

Speaker #3: Our GIC book represents 5% of our general account, compared to 10% to 15% for major competitors, demonstrating ample room for additional growth. In the PRT market, we still expect activity to be weighted in the back half of the year.

Marc Costantini: Our GIC book represents 5% of our general account compared to 10% to 15% for major competitors, demonstrating ample room for additional growth. In the PRT market, we still expect activity to be weighted in H2. Nothing in this market has changed. Pension plans remain overfunded. The appetite for de-risking solutions remains strong, and we expect the double-digit reserve growth we've achieved since 2021 to continue. Turning to slide five. Since we announced the transaction, our conviction has only grown that the merged company will be uniquely positioned to deliver exceptional value. Our industry is in the midst of significant growth opportunity. Annuity sales have grown from roughly $250 billion a year in 2021 to more than $450 billion in 2025.

Speaker #3: Nothing in this market has changed. Pension plans remain overfunded, the appetite for de-risking solutions remains strong, and we expect a double-digit reserve growth we've achieved since 2021 to continue.

Speaker #3: Turning to slide 5, since we announced the transaction, our conviction has only grown that the merged company will be uniquely positioned to deliver exceptional value.

Speaker #3: Our industry is in the midst of significant growth opportunities. Annuity sales have grown from roughly $250 billion a year in 2021 to more than $450 billion in 2025.

Speaker #3: Despite this growth, new Corebridge Research finds that only 28% of people are confident spending in retirement, with fears of running out of money being the top concern.

Marc Costantini: Despite this growth, new Corebridge research finds that only 28% of people are confident spending in retirement, with fears of running out of money being the top concern. By contrast, those with a decumulation plan, especially one that includes guaranteed lifetime income, are far more confident. In short, many more Americans want and need our advice and solutions. Another powerful trend is the massive transfer of wealth between generations. With $100 trillion in assets that is expected to be transferred by mid-century, which will fuel growth in the wealth business. In addition, the life insurance protection gap remains significant, with $100 million Americans expressing a need for coverage. The merger creates a company that is well-positioned to capture this opportunity and drive profitable growth. Starting out, the combined firm will have over $10 million customers.

Speaker #3: By contrast, those with a decumulation plan, especially one that includes guaranteed lifetime income, are far more confident. In short, many more Americans want and need our advice and solutions.

Speaker #3: Another powerful trend is the massive transfer of wealth between generations. With $100 trillion in assets that is expected to be transferred by mid-century, which will fuel growth in the wealth business.

Speaker #3: In addition, the life insurance protection gap remains significant, with 100 million Americans expressing a need for coverage. The merger creates a company that is well-positioned to capture this opportunity and drive profitable growth.

Speaker #3: Starting out, the combined firm will have over $10 million customers. Given the tremendous financial needs we see, our aspiration is to significantly grow that number over time.

Marc Costantini: Given the tremendous financial needs we see, our aspiration is to significantly grow that number over time. We will have all the right attributes to succeed. Our scale will give us a lower cost of capital, greater efficiency, comprehensive customer solutions, and the ability to invest more while attracting top talent. We'll have a large and formidable multi-channel distribution system to reach the broadest possible customer base. Our integrated business model will capture the full value chain, from manufacturing through distribution to asset management. Our commitment to sound financial principles means we'll write business at attractive margins and deliver consistent capital returns. By 2027, the combined company is set to unlock a compelling financial performance, with $5 billion of earnings, $4 billion in cash generation, and a return on equity of over 15%.

Speaker #3: We will have all the right attributes to succeed. Our scale will give us a lower cost of capital, greater efficiency, comprehensive customer solutions, and the ability to invest more while attracting top talent.

Speaker #3: We'll have a large and formidable multi-channel distribution system to reach the broadest possible customer base. Our integrated business model will capture the full value chain, from manufacturing through distribution to asset management.

Speaker #3: And our commitment to sound financial principles means we'll write business at attractive margins and deliver consistent capital return. By 2027, the combined company is set to unlock a compelling financial performance.

Speaker #3: With $5 billion of earnings, $4 billion in cash generation, and a return on equity of over 15%, with $500 million cost synergies directly supporting these targets and a clear pathway to additional value through revenue synergies, we have a clear right to win.

Marc Costantini: With $500 million cost synergies directly supporting these targets and a clear pathway to additional value through revenue synergies, we have a clear right to win. We continue to make excellent progress toward closing the transaction. In addition to the successful shareholder vote, the leadership structure of the combined company continues to take shape. We have determined the first three levels of the organization, and I'm confident we're building the right team to win. The Joint Integration and Transformation office continues to coordinate all merger activity with the goal of ensuring operational excellence for the new company. We are actively collaborating with key distribution partners to ensure a seamless transition, and on day one, we are well positioned to win with our customers. The regulatory review process is proceeding on pace. Federal antitrust review is complete.

Speaker #3: We continue to make excellent progress toward closing the transaction. In addition to the successful shareholder vote, the leadership structure of the combined company continues to take shape.

Speaker #3: We have determined the first three levels of the organization and I'm confident we're building the right team to win. The joint integration and transformation office continues to coordinate all merger activity with the goal of ensuring operational excellence for the new company.

Speaker #3: We are actively collaborating with key distribution partners to ensure a seamless transition. And on day one, we are well-positioned to win with our customers.

Speaker #3: The regulatory review process is proceeding on pace. Federal antitrust review is complete. FINRA approval of the broker-dealer change-and-control is complete. And all state and international regulatory filings have been submitted.

Marc Costantini: FINRA approval of the broker-dealer change in control is complete. All state and international regulatory filings have been submitted. We expect to announce the board of the new company in the near future, and we still anticipate that the transaction will close by year-end, allowing us to hit the ground running in 2027. To win in our industry, we need to have a differentiated customer value proposition, go to market with world-class distribution, and be the easiest company to do business with. Putting the customer at the center of everything we do is a top-to-bottom commitment. Our customer council, sponsored by the executive leadership team, is driving customer focus across a number of initiatives. Everything from the frontline service experience and the technology enablement to our corporate culture and customer safeguards.

Speaker #3: We expect to announce the board of the new company in the near future, and we still anticipate that the transaction will close by year-end.

Speaker #3: Allowing us to hit the ground running in 2027. To win in our industry, we need to have a differentiated customer value proposition, go-to-market with world-class distribution, and be the easiest company to do business with.

Speaker #3: Putting the customer at the center of everything we do is a top-to-bottom commitment. Our customer council, sponsored by the executive leadership team, is driving customer-focus across a number of initiatives.

Speaker #3: Everything from the frontline service experience and the technology enablement to our corporate culture and customer safeguards. Our new Customer Champions Network, representing every business and function at Corebridge, is ensuring we bring the voice of the customer and our distribution partners to everything we do.

Marc Costantini: Our new customer champions network, representing every business and function at Corebridge, is ensuring we bring the voice of the customer and our distribution partners to everything we do. Across every phase of the customer journey, we're committed to driving continuous improvement. In Group Retirement, our planned sponsor Net Promoter Score, a key customer service metric, rose 19 points year over year. We still have more work to do. My goal for the Group Retirement business is top quartile service. Digital remains a key focus area. For example, we recently launched AI agents in our Group Retirement customer contact center to provide a better call experience. This quickly reduced repeat calls and average handling times. In Life, we enhanced our digital service infrastructure, and more broadly, we're implementing a new business acquisition platform.

Speaker #3: Across every phase of the customer journey, we're committed to driving continuous improvement. In group retirement, our plan-sponsored net promoter score, a key customer service metric, rose 19 points year over year.

Speaker #3: But we still have more work to do. My goal for the Group Retirement business is top quartile service. Digital remains a key focus area.

Speaker #3: For example, we recently launched AI agents in our group retirement customer contact center to provide a better call experience. This quickly reduced repeat calls and average handling times.

Speaker #3: In life, we enhanced our digital service infrastructure and more broadly, we're implementing a new business acquisition platform. Our goal is an industry-leading new business experience that increases fully digital submissions and speeds up suitability checks, with 50% of policies issued in 30 minutes or less.

Marc Costantini: Our goal is an industry-leading new business experience that increases fully digital submissions and speeds up suitability checks, with 50% of policies issued in 30 minutes or less. Within Individual Retirement, our focus is on empowering financial advisors by removing friction from their day-to-day operations. Through our support of the Insured Retirement Institute's Digital First initiative, we are modernizing the tool advisors rely on while simultaneously refining our internal workflows to eliminate application errors and accelerate policy issuance. By streamlining these touchpoints, we enable advisors to dedicate more time to their clients and the growth of their practices, all while driving greater operational efficiency behind the scenes. In closing, I want to express the strong commitment of the entire leadership team to exceptional value creation both now and in the future. Thank you again for your approval of the merger.

Speaker #3: Within individual retirement, our focus is on empowering financial advisors by removing friction from their day-to-day operations. Through our support of the insured retirement institute's digital-first initiative, we are modernizing the tool advisors rely on while simultaneously refining our internal workflows to eliminate application errors and accelerate policy issuance.

Speaker #3: By streamlining these touchpoints, we enable advisors to dedicate more time to their clients and the growth of their practices, all while driving greater operational efficiency behind the scenes.

Speaker #3: In closing, I want to express the strong commitment of the entire leadership team to exceptional value creation, both now and in the future. Thank you again for your approval of the merger.

Speaker #3: I'm confident the combined company has the right to win and I can't wait for day one to get here. With that, I'll turn the call over to Chris.

Marc Costantini: I'm confident the combined company has the right to win, and I can't wait for day one to get here. With that, I'll turn the call over to Chris.

Speaker #1: Thank you, Mark. Starting with slide 6, performance in the second quarter was on track with the full-year guidance provided at the start of the year, highlighting diverse earnings and sustained growth across our businesses.

Chris Filiaggi: Thank you, Marc. Starting with slide six, performance in Q2 was on track with the full year guidance provided at the start of the year, highlighting diverse earnings and sustained growth across our businesses. We reported Adjusted pre-tax operating income of $664 million in earnings per share of $1.12, driven by growth in base spread income and fee income. Q2 results were impacted by underperformance for variable investment income. Excluding the impact of VII, EPS increased by 14% year over year. Within VII, alternative investments underperformed, impacted by the market decline in software, coupled with market volatility related to the resurgence of conflict in the Middle East and the broader macro and geopolitical environment.

Speaker #1: We reported adjusted pre-tax operating income of $664 million and earnings per share of $1.12, driven by growth in base spread income and fee income.

Speaker #1: Second quarter results were impacted by underperformance for variable investment income, excluding the impact of VII, EPS increase by 14% year over year. Within VII, alternative investments underperformed, impacted by the market decline in software coupled with market volatility related to the resurgence of conflict in the Middle East, and the broader macro and geopolitical environment.

Speaker #1: As we said earlier in the second quarter, we do not foresee this environment materially changing over the short term, and expect VII returns to remain below target for the remainder of the year.

Chris Filiaggi: As we said earlier in Q2, we do not foresee this environment materially changing over the short term and expect VII returns to remain below target for the remainder of the year. Adjusting for long-term alternative investment returns, we delivered a run rate operating EPS of $1.35, representing a 16% increase year over year. Finally, adjusted ROE was 11.4%, or 13.8% on a run-rate basis, within our 12% to 14% ROE targeted range. Excluding VII, this reflects a 90 basis point increase year over year, underscoring our commitment to consistent, profitable growth. Turning to slide seven, core sources of income, which excludes VII, increased 5% year over year, illustrating our ability to grow across a variety of markets. Within that, spread income increased by 4%, benefiting from asset repositioning and growth in the underlying business as we have consistently reported positive net flows.

Speaker #1: Adjusting for long-term alternative investment returns, we delivered a run-rate operating EPS of $1.35, representing a 16% increase year over year. Finally, adjusted ROE was 11.4%, or 13.8% on a run-rate basis, within our 12% to 14% ROE targeted range.

Speaker #1: Excluding VII, this reflects a 90 basis point increase year over year, underscoring our commitment to consistent, profitable growth. Turning to slide 7, core sources of income, which excludes VII, increased 5% year over year, illustrating our ability to grow across a variety of markets.

Speaker #1: Within that, spread income increased by 4%, benefiting from asset repositioning and growth in the underlying business as we have consistently reported positive net flows.

Speaker #1: More notably, these earnings reflect the full earn-in of the 2025 Fed rate cuts, and our reduced sensitivity to short-term interest rates. Fee income increased 15%, driven by growth in assets under management and administration, and favorable market tailwinds.

Chris Filiaggi: More notably, these earnings reflect the full earn-in of the 2025 Fed rate cuts and our reduced sensitivity to short-term interest rates. Fee income increased 15%, driven by growth in assets under management and administration and favorable market tailwinds. Lastly, underwriting margins decreased 1% year over year. We continue to see positive underwriting results, though they were less favorable than the prior year quarter. Echoing Marc's comments regarding the investments we are making to become the easiest company to do business with, we reported an increase in Q2 general operating expenses in line with the guidance provided at the start of the year. Turning to slide eight and looking at our capital position, our balance sheet continues to be healthy and strong.

Speaker #1: Lastly, underwriting margins decreased 1% year over year. We continue to see positive underwriting results, though they were less favorable than the prior year quarter.

Speaker #1: Echoing Mark's comments regarding the investments, we are making to become the easiest company to do business with. We reported an increase in second quarter general operating expenses, in line with the guidance provided at the start of the year.

Speaker #1: Turning to slide 8 and looking at our capital position, our balance sheet continues to be healthy and strong. We ended the quarter with over $1.4 billion in holding company liquidity, supported by our insurance company distributions of $475 million of dividends in the quarter, and our liquidity exceeds the holding company's needs for the next 12 months.

Chris Filiaggi: We ended the quarter with over $1.4 billion in holding company liquidity, supported by our insurance company distributions of $475 million of dividends in the quarter, and our liquidity exceeds the holding company's needs for the next 12 months. Capital return to shareholders was $412 million in the quarter. Excluding proceeds from the earlier VA reinsurance transaction, we maintained our payout target with a year-to-date payout ratio of 84%, which reflects the acceleration of share repurchases in the H1 of the year. Looking ahead, we are committed to approximately $350 million in share repurchases in the H2 of the year. Lastly, our insurance companies remain well capitalized, with capital ratios exceeding our targets. Next, I'll review a few highlights from each of our businesses, the details of which can be found in the appendix to our earnings presentation.

Speaker #1: Capital return to shareholders was $412 million in the quarter. Excluding proceeds from the earlier VA reinsurance transaction, we maintained our payout target with a year-to-date payout ratio of 84%, which reflects the acceleration of share repurchases in the first half of the year.

Speaker #1: Looking ahead, we are committed to approximately $350 million in share repurchases in the second half of the year. Lastly, our insurance company has remained well-capitalized, with capital ratios exceeding our targets.

Speaker #1: Next, I'll review a few highlights from each of our businesses, the details of which can be found in the appendix to our earnings presentation.

Speaker #1: Note that these results exclude the impact of variable investment income, and notable items. Starting with individual retirement, sales were 3.8 billion dollars, and net flows remained positive, contributing to continued growth in AUMA.

Chris Filiaggi: Note that these results exclude the impact of variable investment income and notable items. Starting with Individual Retirement, sales were $3.8 billion and net flows remain positive, contributing to continued growth in AUMA. While sales declined year over year and sequentially, I want to emphasize Marc's point earlier. We continue to prioritize margin integrity over volume. By adhering to our rigorous pricing rules, we have effectively pivoted our capital deployment towards higher growth areas of our portfolio that offer superior risk-adjusted returns. As we look at the full year, we still expect spread compression to level off by the end of 2026 as older business continues to roll off, and we reaffirm our estimate for base spread income to be approximately $2.55 billion. In addition, fee income increased 17% year over year, reflecting growth in the underlying business.

Speaker #1: While sales declined year over year and sequentially, I want to emphasize Mark's point earlier. We continued to prioritize margin integrity over volume. By adhering to our rigorous pricing drills, we have effectively pivoted our capital deployment toward higher growth areas of our portfolio that offer superior risk-adjusted returns.

Speaker #1: As we look at the full year, we still expect spread compression to level off by the end of 2026 as older business continues to roll off, and we reaffirm our estimate for base spread income to be approximately 2.55 billion dollars.

Speaker #1: In addition, fee income increased 17% year over year, reflecting growth in the underlying business. Lastly, APTLI was flat year over year, reflecting increased spread and fee income offset by higher sales-related expenses, while APTLI increased 5% sequentially.

Chris Filiaggi: Lastly, APTOI was flat year-over-year, reflecting increased spread and fee income offset by higher sales-related expenses, while APTOI increased 5% sequentially. Turning to Group Retirement, our results this quarter illustrate our broader strategy to grow capital-light earnings with a transition from spread-based products towards capital-light, fee-based business. Reflecting that shift, fee income increased 15% year-over-year. Spreads increased sequentially, reflecting the benefit of asset repositioning, though they remain lower year-over-year due to general account outflows in line with the demographic mix shift. AUMA continued to grow sequentially and year-over-year, even with the net outflows for the quarter. Looking ahead, we do not expect any large planned surrenders for the remainder of the year. APTOI decreased 7% year-over-year, reflecting lower spread income and higher operating expenses, partially offset by growth in fee income.

Speaker #1: Turning to group retirement, our results this quarter illustrate our broader strategy to grow capital light earnings. With the transition from spread-based products toward capital light fee-based business.

Speaker #1: Reflecting that shift, fee income increased 15% year over year. Spreads increased sequentially, reflecting the benefit of asset repositioning though they remain lower year over year due to general account outflows in line with the demographic mix shift.

Speaker #1: AUMA continued to grow sequentially in year over year, even with the net outflows for the quarter. Looking ahead, we do not expect any large planned surrenders for the remainder of the year.

Speaker #1: APTLI decreased 7% year over year, reflecting lower spread income and higher operating expenses, partially offset by growth in fee income. We continue to be excited about the opportunities for group retirement.

Chris Filiaggi: We continue to be excited about the opportunities for Group Retirement. We believe our competitive advantage lies in our ability to serve as a lifelong partner to our customers as they transition their needs from in-plan to out-of-plan, ensuring we provide value at every stage of their retirement journey. Turning to Life Insurance, we generated $870 million in sales this quarter, an increase year-over-year and sequentially. APTOI declined 11% year-over-year. Mortality and underwriting results were favorable, though less so than the prior year quarter. On a run rate basis, APTOI was $122 million above the top end of our guide we provided at the start of the year. We remain confident in the steady cash flow and stability the segment provides for the broader portfolio. Institutional Markets remains a consistent growth engine.

Speaker #1: We believe our competitive advantage lies in our ability to serve as a lifelong partner to our customers, as they transition their needs from in-plan to out-of-plan, ensuring we provide value at every stage of their retirement journey.

Speaker #1: Turning to life insurance, we generated $870 million in sales this quarter, an increase year over year and sequentially. APTLI declined 11% year over year, mortality and underwriting results were favorable, though less so than the prior year quarter.

Speaker #1: On a run-rate basis, APTLI was $122 million above the top end of our guide we provided at the start of the year. We remain confident in the steady cash flow and stability of the segment provides for the broader portfolio.

Speaker #1: Institutional markets remained a consistent growth engine. We continue to be attracted to the risk-adjusted returns as evidenced by both underlying reserves and total earnings trending upwards.

Chris Filiaggi: We continue to be attracted to the risk-adjusted returns as evidenced by both underlying reserves and total earnings trending upwards. Q2 sales were strong at $2.6 billion, illustrating our ability to efficiently allocate capital across our businesses. Sales included over $1.8 billion of GIC issuances, maintaining the consistent momentum we've seen and highlighting our ongoing commitment to the market. APTOI increased 36% year-over-year. This growth was underpinned by a 17% expansion in our reserves and a 12% increase in AUMA. Lastly, on pension risk transfer, sales in this space are inherently lumpy. While we, and the entire industry, have seen lower activity in the market, we still anticipate an uptick when we move into H2 of 2026.

Speaker #1: Second quarter sales were strong at 2.6 billion dollars, illustrating our ability to efficiently allocate capital across our businesses. Sales included over $1.8 billion of GIC issuances, maintaining the consistent momentum we've seen and highlighting our ongoing commitment to the market.

Speaker #1: APTLI increased 36% year over year. This growth was underpinned by a 17% expansion in our reserves and a 12% increase in AUMA. Lastly, on pension risk transfer, sales in this space are inherently lumpy.

Speaker #1: While we and the entire industry have seen lower activity in the market, we still anticipate an uptick when we move into the second half of 2026.

Speaker #1: Looking at our investment portfolio, we continue to manage our portfolio with discipline through a dynamic market environment, while remaining proactive in identifying opportunities that support attractive, risk-adjusted returns.

Chris Filiaggi: Looking at our investment portfolio, we continue to manage our portfolio with discipline through a dynamic market environment while remaining proactive in identifying opportunities that support attractive risk-adjusted returns. The portfolio remains high quality, with an average credit rating of A- and 96% investment grade. We also continue to see positive credit migration across both corporate bonds and securitized products, reinforcing the strength and resilience of the portfolio. New money yields remain above roll-off yields, which continues to support growth in net investment income. As I mentioned earlier, we were able to execute asset repositioning at higher yields, further enhancing the earnings of our investment earnings without taking on additional risk. Within private debt, the book remains 91% investment grade, and our private credit assets continue to perform in line with our expectations. Overall, we remain comfortable with the position of our investment portfolio.

Speaker #1: The portfolio remains high-quality, with an average credit rating of A- and 96% investment grade. We also continue to see positive credit migration across both corporate bonds and securitized products, reinforcing the strength and resilience of the portfolio.

Speaker #1: New money yields remain above roll-off yields, which continues to support growth in net investment income. As I mentioned earlier, we were able to execute asset repositioning at higher yields further enhancing the earnings of our investment earnings without taking on additional risk.

Speaker #1: Within private debt, the book remains 91% investment grade, and our private credit assets continue to perform in line with our expectations. Overall, we remain comfortable with the position of our investment portfolio, it is well diversified, actively managed, and aligned with the nature and duration of our liabilities.

Chris Filiaggi: It is well-diversified, actively managed, and aligned with the nature and duration of our liabilities. In closing, our Q2 results reflect the resilience and strategic discipline that define Corebridge. We delivered solid performance in line with our expectations, supported by strong underlying fundamentals in our core businesses and are well-positioned to navigate the current environment. We remain confident in our ability to generate earnings and deliver on our commitment to shareholders. We appreciate your continued trust and are excited about the path ahead. With that, I will turn the call back to Isil.

Speaker #1: In closing, our second quarter results reflect the resilience and strategic discipline that define Corebridge. We delivered solid performance in line with our expectations, supported by strong underlying fundamentals in our core businesses, and our well-positioned to navigate the current environment.

Speaker #1: We remain confident in our ability to generate earnings and deliver on our commitments to shareholders. We appreciate your continued trust and are excited about the path ahead.

Speaker #1: With that, I will turn the call back to Eshel.

Speaker #2: Thank you, Chris. As a reminder, please limit yourselves to one question and one follow-up. Operator, we are now ready to begin the Q&A portion of the call.

Isil Muderrisoglu: Thank you, Chris. As a reminder, please limit yourself to one question and one follow-up. Operator, we are now ready to begin the Q&A portion of the call.

Speaker #3: We will now begin the question-and-answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again.

Operator: We will now begin the question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Now please stand by while we compile the Q&A roster. Your first question comes from the line of Ryan Krueger with KBW. Your line is open. Please go ahead.

Speaker #3: We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device.

Speaker #3: Now please stand by while we compile the Q&A roster. Your first question comes from the line of Ryan Kruger with KBW. Your line is open.

Operator: Your first question comes from the line of Ryan Krueger with KBW. Your line is open. Please go ahead.

Speaker #3: Please go ahead.

Speaker #4: Hey, thanks. Good morning. My first question was on retail annuities and the competitive dynamics. I was curious a little bit more about what you saw change during the quarter.

Ryan Krueger: Hey, thanks. Good morning. My first question was on retail annuities and the competitive dynamics. I'm just curious a little bit more on what you saw change during the quarter. I think you cited pretty competitive conditions earlier in the quarter that led to softer sales, a better June. Hoping to get a little bit more color on what you're seeing there.

Speaker #4: I think you cited pretty competitive conditions earlier in the quarter that led to softer sales, but then a better June. So hoping to get a little bit more color on what you're seeing there.

Speaker #5: Hey, good morning. Ryan, it's Mark here. Good to hear your voice. Thanks for your question. So yeah, I would say as we were finishing up on Q1 and heading into Q2, we saw some additional competitive tension, I would say, in the simple designs and as you know, and as we've mentioned before, we have a significant depth and breadth of distribution across multiple channels.

Marc Costantini: Hey, good morning, Ryan. It's Marc here. Good to hear your voice. Thanks for your question. Yeah. I would say as we were finishing up on Q1 and heading into Q2, we saw some additional competitive tension, I would say, in the simple designs. As you know, as we've mentioned before, we have a significant depth and breadth of distribution across multiple channels. In our view, this is an important point here, we see ourselves first and foremost as judicious capital allocators. When I say distribution channels, I look at not only the retail and across all those distribution channels, but our Institutional Markets as well, and the great business we have there. We saw more opportunities going into Q2 on the Institutional Markets side, and we took advantage of that.

Speaker #5: So in our view, and this is an important point here, we see ourselves first and foremost as a judicious capital allocators. And when I say distribution channels, I look at not only the retail and across all those distribution channels, but our institutional markets as well.

Speaker #5: And a great business we have there. So and we saw more opportunities going into Q2 on the institutional market side, and we took advantage of that.

Speaker #5: And we hold our risk return kind of attributes and objectives very strongly. And we manage very dynamically against those. And that's what you saw in Q2.

Chris Filiaggi: We hold our risk return kind of attributes and objectives very strongly, and we manage very dynamically against those. That's what you saw in Q2. Now, as you mentioned, we saw the dynamic fluctuate over the quarter, we ended the quarter in June being our strongest sales month on the retail side, we entered July with some very good momentum, and we saw that momentum continue through July. We expect, obviously, our retail sales to rebound in Q3. Having said so, we see, and we continue to see very significant opportunities on the Institutional Markets side. I think that capital allocation and the dynamic nature of our distribution is evidenced through these results and what we'll see for the rest of the year. Thank you.

Marc Costantini: We hold our risk return kind of attributes and objectives very strongly, and we manage very dynamically against those. That's what you saw in Q2. Now, as you mentioned, we saw the dynamic fluctuate over the quarter, we ended the quarter in June being our strongest sales month on the retail side, we entered July with some very good momentum, and we saw that momentum continue through July. We expect, obviously, our retail sales to rebound in Q3. Having said so, we see, and we continue to see very significant opportunities on the Institutional Markets side. I think that capital allocation and the dynamic nature of our distribution is evidenced through these results and what we'll see for the rest of the year. Thank you.

Speaker #5: Now, as you mentioned, we saw the dynamic fluctuate over the quarter, and we ended the quarter in June being our strongest sales month on the retail side.

Speaker #5: And we entered July with some very good momentum, and we saw that momentum continue through July. So we expect obviously our retail sales to rebound in Q3.

Speaker #5: So there's having said so, we see and we continue to see very significant opportunities on the institutional market side. So I think that capital allocation and the dynamic nature of our distribution is evidenced through these results and what we'll see for the rest of the year or so.

Speaker #5: Thank you.

Speaker #4: Thanks. And then I had a question on individual retirement-based spread income. You reiterated the full-year guidance, despite some of the benefits from the opportunistic asset repositioning actions you took in the quarter.

Ryan Krueger: Thanks. Then I had a question on Individual Retirement base spread income. You reiterated the full year guidance despite some of the benefits from the opportunistic asset repositioning actions you took in the quarter. Maybe it's splitting hairs, but just curious kind of why no upside to the original guidance given those actions? Maybe they were contemplated to begin with.

Speaker #4: I mean, maybe it's splitting hairs, but just curious—why no upside to the original guidance given those actions? Or maybe they were contemplated to begin with.

Speaker #5: Yeah, hey Ryan, it's Chris. Thanks for the question. So I think the way that I would think about it, yes, we are reiterating the guidance of 2550.

Chris Filiaggi: Yeah. Hey, Ryan, it's Chris. Thanks for the question. I think the way that I would think about it, yes, we are reiterating the guidance of $2,550. While we did see some improvements in the base spread as the book continues to roll off, we would still expect to see some compression in spreads over the next couple of quarters, which we would still expect to bottom out at the end of 2026. I think that's how you should think about it. While there's some positivity this quarter, there's still going to be natural roll-off on the book. We're just going to have single-digit compression for the rest of the year.

Speaker #5: While we did see some improvements in the base spread as the book continues to roll off, we would still expect to see some compression in spreads over the next couple of quarters, which we would still expect to bottom out at the end of 2026.

Speaker #5: So, I think that's how you should think about it. While there's some positivity this quarter, there's still going to be natural roll-off in the book, which is going to have single-digit compression for the rest of the year.

Speaker #4: Great, thank you.

Ryan Krueger: Great. Thank you.

Speaker #2: Your next question

Operator: Your next question comes from the line of Thomas Gallagher with Evercore ISI. Your line is open. Please go ahead.

Speaker #3: comes from the line of Tom Gallagher with Evercore ISI. Your line is open. Please go ahead.

Thomas Gallagher: Hey. First question, just a follow-up on institutional spread product, Marc, that you were highlighting. Is this really your growth there? Was that really a function of being more opportunistic at a time when retail was challenged? Or do you see that as a bigger runway and growth opportunity in the coming quarters when you think about capacity and pricing and margin and that sort of thing?

Speaker #6: Hey, first question, just a follow-up on institutional spread product mark that you were highlighting. Is this really your growth there? Was that really a function of being more opportunistic at a time when retail was challenged?

Speaker #6: Or do you see that as a bigger runway and growth opportunity in the coming quarters when you think about capacity and pricing and margin and that sort of thing?

Speaker #5: Yeah, Tom, good morning. Great to hear your voice as well. I would say that, overall, we see a lot of opportunity on the institutional market side, and we see a lot of upside as we move forward.

Marc Costantini: Yeah. Tom, good morning. Great to hear your voice as well. I would say that overall, we see a lot of opportunity on the institutional market side, and we see a lot of upside as we move forward. I think as I mentioned in my remarks, our funding agreement-backed note business is 5% or so of our balance sheet. If you look at the environment, a lot of players are hovering more around 10% to 15%, I think. We have a lot of runway and upside there. I think when you combine the balance sheets of ourselves and Equitable, I think you'll have even more, I would say, demand and appeal for that type of offering for us. I do see some growth at attractive risk-return margins as we move forward.

Speaker #5: I think as I mentioned in my remarks, it's the our funding agreement-backed business is like 5% or so of our balance sheet. If you look at the environment, a lot of players are hovering more around 10 to 15 percent, I think so.

Speaker #5: So we have a lot of runway and upside there. I think when you combine the balance sheets of ourselves and Equitable, I think you'll have even more, I would say, demand and appeal for that type of offering for us.

Speaker #5: So I do see some growth that attractive risk return margins as we move forward. In addition to as Chris mentioned in his remarks, the back half of the year, we see opportunities on the pension risk transfer side.

Marc Costantini: In addition to, as Chris mentioned in his remarks, at the back half of the year, we see opportunities on the pension risk transfer side. I would say we started in Q3 with some, I would say, tailwinds in both those businesses. Again, I mentioned to Ryan that we have some tailwinds on the retail side as well going into Q3. That's kind of my perspective.

Speaker #5: And I would say we started and Q3 with some I would say tailwinds in both those businesses again, as I mentioned to Ryan that we have some tailwinds on the retail side as well going into Q3.

Speaker #5: So no, that's kind of my perspective.

Speaker #6: Thanks. Thanks for that. My follow-up is just, any update on how things are progressing with potential collaboration with Nippon Life on Japanese annuity products?

Thomas Gallagher: Thanks for that. My follow-up is just any update on how things are progressing with potential collaboration with Nippon Life on Japanese annuity products. Is that still super early, unclear? Any line of sight on anything tangible coming together there?

Speaker #6: Is that still super early, unclear? Or is that any line of sight on anything tangible coming together there?

Speaker #5: Yeah, thanks, Tom. I would say that we continue to have very robust discussions with Nippon about core manufacturing products for the local Japanese market.

Marc Costantini: Thanks, Tom. I would say that we continue to have very robust discussions with Nippon about co-manufacturing products for the local Japanese market. We and they feel that their economy and the demand for products that we have a significant expertise at manufacturing is growing in Japan, and it's not lost on Nippon that there's a vibrant opportunity there to their proprietary channel and to their third-party broker-dealer channel and bank channel. I guess the way I'll say it is we're probably in the third or fourth inning of those discussions, but they are moving in a good direction. It's too early to tell when we kind of agree on whatever we could do together. Obviously, like it is the case here in North America, you need to file the product with the FSA. It needs to be developed and manufactured and start issuing it.

Speaker #5: We and they feel that their economy and the demand for products that we have a significant expertise at manufacturing is growing in Japan. And it's not lost on Nippon that there's a vibrant opportunity there to their proprietary channel and to their third-party broker-dealer channel, right, and bank channel.

Speaker #5: So, I guess the way I'll say it is, we're probably in the third or fourth inning of those discussions, but they are moving in a good direction.

Speaker #5: But it's too early to tell when we kind of agree on whatever we could do together. And then obviously, like it is the case here in North America, you need to find a product with the FSA and needs to be developed and manufactured.

Speaker #5: And start issuing it. So that's there's a timeline there as well. So but we are cautiously optimistic that there will be a lot of opportunity for us and Nippon.

Marc Costantini: There's a timeline there as well. We are cautiously optimistic that there will be a lot of opportunity for us and Nippon, and they have wonderful brand and distribution there, and the collaboration is strong across both firms. We are excited about the prospects that you mentioned there.

Speaker #5: And they have a wonderful brand and distribution there, and the collaboration is strong across both firms. So we are excited about the prospects that you mentioned there.

Thomas Gallagher: Okay. Thank you.

Speaker #6: Okay, thank you.

Speaker #2: Your next question

Operator: Your next question comes from the line of Suneet Kamath with Jefferies. Your line is open. Please go ahead.

Speaker #3: Comes from the line of Suneet Kamath with Jefferies. Your line is open. Please go ahead.

Suneet Kamath: Great. Thanks. I wanted to start with annuities and the expense ratio. Just based on some of the work we've done, it looks like on a pro forma basis, your expense ratio is going to be materially below some of your peers. I wanted to sort of test that with you. Relatedly, if that's true, I would assume one of the potential outcomes is in environments where things are a little bit irrational from a competitive perspective, that expense advantage should allow you to continue to grow and hit your returns. Just want to test those two ideas out with you. Thanks.

Speaker #6: Great, thanks. I wanted to start with annuities and the expense ratio. Just based on some of the work we've done, it looks like, on a pro forma basis, your expense ratio is going to be materially below some of your peers.

Speaker #6: So I wanted to sort of test that with you. And then relatedly, if that's true, I would assume one of the potential outcomes is in environments where things are a little bit irrational from a competitive perspective, that expense advantage should allow you to continue to grow and hit your return.

Speaker #6: So just want to test those two ideas out with you. Thanks.

Marc Costantini: Hey, Suneet. Good morning. It's Mark. How are you? Thanks for your question. I would say, as we announced the transaction, and you've heard obviously Robin and myself in particular talk about it a lot, we expect expense savings of $500 plus, $100 million a year within two years of obviously the merger. That speaks to obviously the expense efficiency. Obviously scale is a big part of the reason that this market remains attractive to us. You need scale. There's a fixed cost to kind of digitizing your business, implementing and deploying AI, there's an obvious scale advantage to the expense ratio as you're implicitly referring to here in our business. We do expect to see the benefit of that.

Speaker #5: Hey Suneet, good morning. It's Martin. How are you? So, thanks for your question. I would say, as we announce the transaction—and you've heard, obviously, Robin and myself in particular talk about it a lot—we expect...

Speaker #5: Expense savings of 500 plus 100 million a year, within two years of obviously the merger. So that speaks to obviously the expense efficiency. And obviously scale, is a big part of the reason that this market remains attractive to us.

Speaker #5: You need scale. There's a fixed cost to digitizing our business, implementing and deploying AI. And there's obviously a scale advantage to the expense ratio, as you're implicitly referring to here in our business.

Speaker #5: And we do expect to see the benefit of that. But I would say it'll span a number of dimensions from the efficiency of our capital use, the efficiency and the depth and breadth of our distribution, our ability to pivot products depending on where we see the opportunities and the client needs, the institutional market side that I just discussed with Tom here.

Marc Costantini: I would say it'll span a number of dimensions from the efficiency of our capital use, the efficiency and the depth and breadth of our distribution, our ability to pivot products depending on where we see the opportunities and the client needs, the Institutional Markets side that I just discussed with Tom here. I would say, and obviously on the origination side, the great partnership we'll have, obviously with AllianceBernstein on origination and the great partnership we have with Blackstone, BlackRock, I think will give us on domain across all these dimensions, very significant competitive presence. That's why looking forward to the merger very much so. All of that, I would say, would factor into how we see the market.

Speaker #5: So I would say and obviously on the origination side, the great partnership we'll have obviously with Alliance Pharmacy, our own origination and the great partnership we have with Blackstone and BlackRock, I think will give us on the main across all these dimensions, very significant competitive presence.

Speaker #5: And that's why we're looking forward to the merger very much so. So all of that, I would say, would factor into how we see the market.

Speaker #6: Okay, that's helpful. And then, I guess shifting gears to alternatives, it sounds like a lot of the other companies that have reported are guiding to a better sort of second half relative to the first half.

Suneet Kamath: Okay. That's helpful. I guess shifting gears to alternatives, it sounds like a lot of the other companies that have reported are guiding to a better sort of H2 relative to the H1, I think you're saying things will still be challenged in the H2. Is there something sort of unique about your portfolio versus others, or are you just being conservative there? Thanks.

Speaker #6: And I think you're saying things will still be challenged in the second half. So, is there something sort of unique about your portfolio versus others, or are you just being conservative there?

Speaker #6: Thanks.

Speaker #5: Yeah, so I'll mention one comment and I'll pass it to Lisa, our chief investment officer, which will give you some perspective. But I would remind everybody that when you look at the concentration of vaults and our balance sheet, it's like less than 3%, right?

Marc Costantini: Yeah. I'll mention one comment and I'll pass it to Lisa, our Chief Investment Officer, which will give you some perspective. I would remind everybody that when you look at the concentration of alts on our balance sheet, it's less than 3%. It's very thoughtfully to that level, which lines up with our long-tail liabilities. You can see a lot of the alts being deployed against our Institutional Markets, and more specifically our pension risk transfer business, which has longer tail liabilities, some of our Life business obviously. It's an economically attractive asset to defeat those long-tail liabilities that otherwise there's no credit assets available. I think that's the frame we need to think about it when you think about how we manage the portfolio. Now to the specific question you have, I'll pass it to Lisa.

Speaker #5: And it's very thoughtfully to that level, which lines up with our long tail liabilities. And you can see a lot of the alt being deployed against our institutional markets and more specifically our pension risk transfer business, which has longer tail liabilities.

Speaker #5: Some of our life business obviously. And it's an economically attractive asset to defeat those long tail liabilities that otherwise there's no credit assets available, right?

Speaker #5: So I think that's the frame we need to think about when we think about how we manage the portfolio. Now, to the specific question you have, I'll pass it to Lisa.

Lisa Longino: Thanks Marc. Good morning. As Marc mentioned, when we think about our long-term return, it's over the very long term and over multiple cycles, our alt portfolio is primarily PE, it's real estate equity in the form of funds, then there's residual hedge funds. What you have seen in the past is our alt performance has been impacted by maybe real estate returns or hedge funds. In this quarter, the marks on our PE funds drove the underperformance. Up until this time, PE has really been meeting our long-term expectations. What you're seeing is normally with our PE portfolio, it's very broad and diverse, we'll have weakness in one sector offset by strength in another. Unfortunately, in this past quarter, the market was weaker all around.

Speaker #7: Thanks, Martin. Good morning, thanks. As Mark mentioned, when we think about our long-term return, it's over the very long term and over multiple cycles.

Speaker #7: And our portfolio is primarily PE, but it's real estate equity in the form of funds. And then there's residual hedge funds. And what you have seen in the past is PE are alt performance has been impacted by maybe real estate returns or hedge funds, but in this quarter, the marks on our PE funds drove the underperformance.

Speaker #7: And up until this time, PE has really been meeting our long-term expectations. And so what you're seeing is normally with our PE portfolio, it's very broad and diverse.

Speaker #7: And we'll have weakness in one sector offset by strength in another. Unfortunately, in this past quarter, the market was weaker all around. So large backlog of PE exits in existing investments have not been meaningfully reduced.

Lisa Longino: The large backlog of PE exits in existing investments have not been meaningfully reduced. We're not getting the realization that would generate gains to offset some of our marks. We did guide lower and we think just continued in the market around AI valuations, geopolitical uncertainty, that could impact returns going forward. Higher rates can certainly impact the mark to market on real estate funds, and although we think we could see positive returns in H2, we are not going to hit or do not expect to hit our long-term expectations for this year in particular.

Speaker #7: So we're not getting the realizations that would generate gains to offset some of our marks. We did guide lower and we think just continued in the market around AI valuations, geopolitical uncertainty, that could impact returns going forward, higher rates, can certainly impact the mark-to-market on real estate funds.

Speaker #7: And although we think we could see positive returns in the second half, we are not going to hit or do not expect to hit our long-term expectations for this year.

Speaker #7: In particular.

Speaker #6: Okay, thanks.

Chris Filiaggi: Okay, thanks.

Suneet Kamath: Okay, thanks.

Speaker #3: Your next question comes from the line of Joel Hurwitz with Dowling & Partners. Your line is open. Please go ahead.

Operator: Your next question comes from the line of Joel Hurwitz with Dowling & Partners. Your line is open. Please go ahead.

Speaker #8: Hey, good morning. Wanted to start on base spreads. I have another one there. Can you just provide some more color on the actions that you took in the quarter to support the expansion?

Joel Hurwitz: Hey, good morning. Wanted to start on base spreads, have another one there. Can you just provide some more color on the actions that you took in the quarter to support the expansion? How much was repositioned, and do you see further similar opportunities in H2 of the year?

Speaker #8: How much was repositioned? And do you see further similar opportunities in the back half of the year?

Lisa Longino: I'll take that. Hi, Joel. It's Lisa Longino. Thanks for the question. With our portfolio, as Chris mentioned in his script, this is a very high quality, well-diversified portfolio, and 96% of it is investment grade. The portfolio has remained resilient through a variety of cycles, but we do proactively manage the portfolio with a focus on our overall balance sheet. Regarding asset repositioning that we've done, it really entails assessing names or sectors we're less sanguine in, and we'll rotate into other sectors where we prefer the outlook, or we see relative value opportunity. This is very proactive. Given the move in rates, this repositioning has allowed us to increase yield while maintaining our credit quality. We feel pretty comfortable with it. It's something we continue to do. That really sums it up.

Speaker #7: So I'll take that. Hi, Joel, it's Lisa Longino. Thanks for the question. With our portfolio, as Chris mentioned in his script, this is a very high-quality, well-diversified portfolio.

Speaker #7: And 96% of us is investment grade. The portfolio has remained resilient through a variety of cycles, but we do proactively manage the portfolio with a focus on our overall balance sheet.

Speaker #7: And regarding asset repositioning that we've done, it really entails assessing names or sectors we're less sanguine about, and we'll rotate into other sectors where we prefer the outlook.

Speaker #7: Or we see relative value opportunities, so this is very proactive. And given the move in rates, this repositioning has allowed us to increase yield while maintaining our credit quality.

Speaker #7: I mean, we feel pretty comfortable with it. It's something we continue to do, and so that really sums it up.

Speaker #8: Got it, that's helpful. And then, just wanted to touch on buyback expectations for the back half of the year. Chris, I think you said around $350 million in the second half, which will bring you back to your payout ratio target.

Joel Hurwitz: Got it. That's helpful. Then just wanted to touch on buyback expectations for the H2 of the year. Chris, I think you said around $350 million in the H2 which will bring you back to your payout ratio target. I guess just given the strong capital and cash generation and where the stock's trading at, would you consider drawing down some of the excess to exceed your payout ratio for this year?

Speaker #8: But I guess, just given the strong capital and cash generation and where the stock's trading at, would you consider drawing down some of the excess to exceed your payout ratio for this year?

Speaker #5: Yeah, hey, Joel. Chris, thanks

Chris Filiaggi: Hey, Joel. It's Chris. Thanks for the question. We do have about $1.4 billion of capital at the holdco that is in excess of our 12-month needs. At this point, we remain committed to approximately $350 million of share repurchases during the year in line with our pre-merger plans. For 2026, that would mean we would purchase about $1.9 billion share repurchases, and if you look at 2025 and 2026, we would have purchased over $4 billion

Speaker #6: For the question—so we do have about $1.4 billion of capital at the HoldCo that is in excess of our 12-month needs.

Speaker #6: But at this point, we remain committed to approximately 350 million dollars of share repurchases during the year in line with our pre-merger plan. For 2026, that would mean we would purchase about 1.9 billion share repurchases.

Speaker #6: And if you look at '25 and '26, we would purchase over 4 billion dollars of share repurchases. So I think overall, at this point, we feel comfortable with our levels.

Chris Filiaggi: the share purchases. I think overall at this point, we feel comfortable with our levels. As we look to the combined company and the $4 billion of cash generation of the new co, I think we'll have an opportunity to revisit that as part of our investor day.

Speaker #6: And as we look to the combined company and the 4 billion dollars of cash generation of the NUCO, I think we'll have an opportunity to revisit that as part of our investor day.

Joel Hurwitz: Oh, good. Thank you.

Speaker #8: All good. Thank you.

Speaker #3: Your next question comes from the line of Wes Carmichael with Wells Fargo. Your line is open. Please go ahead.

Operator: Your next question comes from the line of Wes Carmichael with Wells Fargo. Your line is open. Please go ahead.

Speaker #9: Hey, thank you. Good morning. I had a question. Equitable announced the divestiture of the company's employee benefits business. It sounds like maybe that was a little bit unique because the company was approached by the Hartford.

Wes Carmichael: Hey, thank you. Good morning. Just had a question. Equitable announced the divestiture of the company's employee benefits business. Sounds like maybe that was a little bit unique as the company was approached by The Hartford. As you look at the portfolio post the VA transaction, are there any other subscale businesses you'd think about divesting, any risk transfer you might see ahead of the merger or closely after?

Speaker #9: But as you look at the portfolio post the VA transaction, are there any other sub-scale businesses you'd think about divesting? Any risk transfer you might see ahead of the merger or closely after?

Marc Costantini: Hey, good morning, Wes. It's Mark here. Thanks for that question. Yes, that was a great transaction, in my opinion, and a wonderful one for Hartford and a wonderful one for Equitable and for the new Equitable as we move forward. As I think you will have heard from Mark and Robin there, obviously it's the sale of a subscale business, but a wonderful platform that augments what Hartford is doing. Win-win on many dimensions. Now to your question, I would say that that was the only subscale operation. When you look at the combination, everything else, I think we will have a leadership kind of position and an opportunity for growth and upside. The short answer to your question is no, we don't see any other businesses currently or activities that we see as having the same characteristics that led to this transaction.

Speaker #5: Hey, good morning, Wes. It's Mark here. Thanks for that question. And yes, that was a great transaction, in my opinion, and a wonderful one for Hartford, and a wonderful one for Equitable—and for the new Equitable as we move forward.

Speaker #5: And as I think you will have heard from Mark and Robin there, obviously, it's the sale of a sub-scale business, but a wonderful platform that augments what Hartford is doing.

Speaker #5: So win-win on many dimensions. Now, to your question, I would say that that was the only sub-scale operation. When you looked at the combination, everything else, I think we will have a leadership kind of position and an opportunity for growth and upside.

Speaker #5: So as I sort of answer your question is, no, we don't see any other businesses currently or activities that we see as having the same characteristics that led to this transaction.

Speaker #5: So that's my perspective.

Marc Costantini: That's my perspective.

Speaker #9: No, thanks, Mark. Switching gears—in life insurance, you've seen some pretty good core results there in the quarter. But just taking a step back, how are you thinking about longer-term mortality trends in that business?

Wes Carmichael: No, thanks, Mark. Just switching gears. In Life Insurance, you've seen some pretty good core results there in the quarter. Just taking a step back, how are you thinking about longer term mortality trends in that business? It seems like mortality for the industry at least has been more favorable. Do you see that continuing, and how are you thinking about that headed into the assumption review?

Speaker #9: It seems like mortality for the industry, at least, has been more favorable. So, do you see that continuing? And how are you thinking about that headed into the assumption review?

Speaker #5: Yeah, thank you, Wes. That's a very good question. One of the things that I think I may have mentioned this to some of you over the six, seven months I've been here, when I dug into the balance sheet and the businesses, I saw mortality results being very favorable here versus expected for a number of quarters.

Marc Costantini: Thank you, Wes. That's a very good question. One of the things, and I think I may have mentioned this to some of you, over the six, seven months I've been here, when I dug into the balance sheet and the businesses, I saw mortality results being very favorable here versus expected for a number of quarters, which speaks very highly to the quality of the underwriting, the quality of the business, and the quality of the distribution. That continues to be the case, and we saw that continue in Q2 with some very strong mortality results. You've seen, I think, in some pockets across the industry, some very favorable mortality. There's some impact, I think, of coming out of COVID and what that did, and as well, some of these new drugs, obviously, that are affecting people's longevity.

Speaker #5: Which speaks very highly to the quality of the underwriting, the quality of the business, the quality of the distribution. And that continues to be the case.

Speaker #5: And we saw that continue in Q2 with some very strong mortality results. And like you've seen, I think in some pockets across the industry, some very favorable mortality.

Speaker #5: And there's some impact, I think, of coming out of COVID and what that did. And as well, some of these new drugs, obviously, they're affecting people's longevity.

Marc Costantini: All in all, we are bullish on the life business. As well, in line with some of the comments I made before, I see no reason why our business should not be twice the size it is right now, given the distribution opportunity we have, the attractive risk-return profile, and the complementary nature of that liability versus everything else we're doing. I'll mention as well that as we come together with Equitable, we'll have access to the VUL product. I think we've mentioned there's a lot of revenue synergies, and that's definitely going to be one in terms of adopting that chassis into our distribution output. We see upside on the life side based on mortality and other dynamics in the market and demand, obviously, from the Americans for protection.

Speaker #5: So all in all, we are bullish on the light business. And as well, in line with some of the comments I made before, I see no reason why our business should not be twice the size it is right now given the distribution opportunity we have and the attractive risk-return profile.

Speaker #5: And the complementary nature of that liability versus everything else we're doing. And I'll mention as well that as we come together with the Equitable, we'll have access to the VUL product.

Speaker #5: And I think we've mentioned there's a lot of revenue synergies, and that's definitely going to be one in terms of adopting that chassis into our distribution outlet.

Speaker #5: So we see upside on the life side based on mortality and other dynamics in the market, and obviously from the Americans for protections.

Speaker #9: Thank you.

Wes Carmichael: Thank you.

Speaker #3: Your next question comes from the line of Yaron Canar with Dowling & Partners. Your line is open. Please go ahead.

Operator: Your next question comes from the line of Yaron Kinar with Dowling & Partners. Your line is open. Please go ahead.

Speaker #9: Thank you. Actually, with Mizuho. You had mentioned that sales in the individual retirement business were getting a bit better in June. In which of the retirement products are you seeing that improvement?

Yaron Kinar: Thank you. Actually with Mizuho. You had mentioned that sales in the Individual Retirement business were getting a bit better in June. In which of the retirement products are you seeing that improvement? Is it kind of across the board, or are you still seeing more pressure in fixed annuities?

Speaker #9: Is it kind of across the board or are you still seeing more pressure in fixed annuities?

Speaker #5: Yeah, good morning, Yaron. It's Mark here. How are you? So I would say that the nice trends in sales we've seen heading into June and into Q3 are across the board.

Marc Costantini: Yeah. Good morning, Yaron. It's Marc here. How are you? I would say that the nice trends in sales we've seen heading into June and into Q3 are across the board. We introduced some enhancements to our products and our features on our index annuity. We refined some of our living benefit offerings, and we introduced some additional indices and structures. It's a complementary aspect of some new solutions for our distribution and as well as some upside across a number of the product lines. I would say it's across the board and not one in particular. Again, I would say there's a lot of competitive activity in the simpler structures, and we try to focus on some of the more sophisticated client solutions.

Speaker #5: But we introduced some enhancements to our products and our features on our index annuity. We refined some of our living benefit offerings. And we introduced some additional indices and structures.

Speaker #5: So we see, as a complementary aspect of some new solutions for our distribution, as well as some upside across a number of the product lines.

Speaker #5: So I would say it's across the board and not one in particular. But it's, again, I would say there's not a competitive activity in the simpler structures.

Speaker #5: And we try to focus on some of the more sophisticated client solutions.

Speaker #9: Thank you. And then on the rotation into some of the new assets that allowed you to get some better yields, can you maybe talk about the asset classes that you rotated into?

Yaron Kinar: Thank you. Then on the rotation into some of the new assets that allowed you to get some better yields, can you maybe talk about the asset classes that you rotated in? Are they still the same classes? Namely, are you still in kind of corporate debt, or are you moving more into private credit? Where were these opportunities showing up?

Speaker #9: Are they still the same classes, namely are you still in kind of corporate debt or are you moving more into private credit? Where would these opportunities showing up?

Speaker #2: I can answer that. Thanks for the question. So, in terms of what we sold, we really sold lower-yielding high-yield assets, some EM, and we actually sold some lower-yielding private assets that we have in a secondary private trader.

Lisa Longino: I can answer that. Thanks for the question. In terms of what we sold, we really sold lower yielding high yield assets, some EM, and we actually sold some lower yielding private assets that we have a secondary private trader and that shows liquidity actually in that asset class. Really what we rotated into was investment grade that was public assets, RMBS, and

Speaker #2: And that shows liquidity, actually, in that asset class. And really, what we rotated into was investment-grade—that was public assets, RMBS, and some private ABS.

Lisa Longino: Some private ABS, over 50% of the purchases were in single A or higher. Again, felt very good about incremental yield while maintaining, or in some cases improving, the credit quality.

Speaker #2: But over 50% of the purchases were in single-layer hire. So again, felt very good about incremental yield while maintaining or in some cases improving the credit quality.

Speaker #9: Thanks so much.

Pablo Singzon: Thanks so much.

Speaker #3: Your next question comes from the line of Tracy Benguici with Wolf Research. Your line is open. Please go ahead.

Operator: Your next question comes from the line of Tracy Benguigui with Wolfe Research. Your line is open. Please go ahead.

Speaker #10: Thank you. Good morning. A question on adding $100 billion of AUM to AB through the Equitable merger over time. How does that stack up against the existing Blackstone mandate, which looks about $20 billion short of the '92 and a half billion target by the third quarter '27?

Tracy Benguigui: Thank you. Good morning. A question on adding $100 billion of AUM to AB through the Equitable merger over time. How does that stack up against the existing Blackstone mandate, which looks about $20 billion short of a $92.5 billion target by Q3 2027? To confirm, is the base case just to absorb the make whole rather than reallocate internally managed assets to Blackstone? Since forcing that mandate would actually skew the general account to more heavily towards private credit. Otherwise, if satisfying the Blackstone mandate, it takes priority. Doesn't defeating that make whole and hitting that mandate push out the revenue synergies from the incremental AB AUM?

Speaker #10: To confirm, is the base case just to absorb the May call rather than reallocate internally managed assets to Blackstone? Since forcing that mandate would actually skew the general account to more heavily towards private credit.

Speaker #10: Otherwise, if satisfying the Blackstone mandate, it takes priority. Doesn't defeating that May call and hitting that mandate push out the revenue synergies from the incremental AB AUM?

Marc Costantini: Good morning, Tracy. It's Marc. How are you? I'm going to try to deconstruct your comments or questions here. The first comment I will make is Blackstone is a great partner of ours. They originate very good assets at very attractive yield, and the fees they charge are more than made up by the overall yield and quality of the origination and how complementary it is to the rest of what we do, as is the case, by the way, for BlackRock and our own origination team and with the new, obviously, relationship AllianceBernstein will do. I just want to say that. It is true that we have a commitment to get to $92.5 billion by end of Q3.

Speaker #5: Ignoring Tracy, it's Mark. How are you? So, I'm going to try to deconstruct your comments or questions here. The first comment I will make is, Blackstone is a great partner of ours.

Speaker #5: They originate very good assets and very attractive yield. And the fees they charge are more than made up by the overall yield and quality of the origination.

Speaker #5: And I'll complementary this to the rest of what we do as is the case, by the way, for BlackRock and our own origination team and what the new, obviously, relationship aligns Bernstein will do.

Speaker #5: So I just want to say that. And it is true that we have a commitment to get to $92.5 billion by the end of Q3.

Speaker #5: However, we look at the sourcing, we look at the nature of liabilities we write, we look at the need, and then we find the best origination to meet that need irrespective of what are sources and how it comes to be.

Marc Costantini: However, we look at the sourcing, we look at the nature and liabilities we write, we look at the need, we find the best origination to meet that need, irrespective of where the source is and how it comes to be and whether we're $20 billion, $15 billion or anything else short, it's a temporary kind of process. If there's a make whole to be made, it's going to be a temporary charge if that's the case. We will get to $92.5 given the size of the balance sheet and the growth we have across our business organically. That's the first test. Now you asked about the $100 billion that is going to AllianceBernstein over time. That is going to be complementary to whatever Blackstone does. I think we mentioned that the combined entity will need origination of $80+ billion a year.

Speaker #5: And whether we're 20 billion, 15 billion, or anything else short, it's a temporary kind of process. So if there's a May call to be made, it's going to be a temporary charge.

Speaker #5: If that's the case and we will get to 92 and a half given the size of the balance sheet and the growth we have across our business organically.

Speaker #5: So that's the first step. Now, you asked about the $100 billion that is going to AllianceBernstein over time. That is going to be complementary to whatever Blackstone does.

Speaker #5: I think we mentioned that the combined entity will need origination of 80-plus billion a year if you look at the six, seven-year duration on our products.

Marc Costantini: If you look at the six, seven-year duration on our product, that means that 15% or so turns over every year. You'll get some natural attrition of the current assets that will flow to AB. As we grow the business, we'll have origination. Yes, we will reposition some of the assets on our current balance sheet to AllianceBernstein. We see a significant opportunity of partnering with AllianceBernstein and this great origination capability we have on a go-forward basis, and we'll be able to be very complementary to Blackstone, as I mentioned in my original comments here. Thanks for your question.

Speaker #5: That means that about 15% or so turns over every year. So you'll get some natural attrition of the current assets that will flow to AB. As we grow the business, we'll have origination as well.

Speaker #5: And yes, we will reposition some of the assets on our current balance sheet to AllianceBernstein. And we see a significant opportunity in partnering with AllianceBernstein and this great origination capability we have on a go-forward basis.

Speaker #5: And we'll be able to be very complementary to Blackstone, as I mentioned in my original comments here. So, thanks for your question.

Tracy Benguigui: Great. I have a question on the GIC market, where you're pretty active. We saw a reinsurer assume 500 million FABN as part of a risk transfer deal, this is a more capital light business. I could see the attraction by the counterparty. Can you see yourself lending your higher rating to help get a decent cost of funds and reinsuring that to a counterparty with maybe a lower rating and earn some fee from that? I'm just curious if we could see this type of market.

Speaker #10: Great. I have a question on the GIC market, where you're pretty active. We saw a reinsurer assume a $500 million FABN as part of a transfer deal.

Speaker #10: And this is a more capital-like business. I could see the attraction for the counterparty. Can you see yourselves lending your higher rating to help get a decent cost of funds and reinsuring that to a counterparty with maybe a lower rating, and earn some fee from that?

Speaker #10: I'm just curious if we could see this type of market.

Speaker #5: Yeah. Thanks, Tracy. I think you're referring to a recent transaction that was announced. And obviously, best to ask them the details as to the structures on account came to be.

Marc Costantini: Yeah. Thanks, Tracy. I think you're referring to a recent transaction that was announced and obviously, best to ask them the details as to the structures on how it all came to be. You're talking about, is there a source of astute leveraging of capital and capital deployment and capital allocation. Whether it's two structures such as you're saying or other structures, I would say that the current corporate and Equitable and the combined entity will be highly focused on astute capital allocation as you saw in terms of our sales between the retail and Institutional Markets, but as well using various tools available to optimize obviously the outcomes for all our stakeholders and all of you on the phone obviously.

Speaker #5: But you're talking about is there a source of astute, I would say, leveraging a capital and capital deployment and capital allocation. And I would say that whether it's too structures such as you're saying or other structures, I would say that the current corporate and equitable and the combined entity will be highly focused on astute capital allocation, as you saw in terms of our sales between the retail institutional markets, but as well using various tools available to optimize, obviously, the outcomes for all our stakeholders and all of you on the phone, obviously.

Marc Costantini: I won't point to exactly that structure, but capital allocation and optimized capital allocation is something that we do.

Speaker #5: So at one point, exactly that structure, but I would say capital allocation and optimized capital allocation is something that we do.

Marc Costantini: I won't point to exactly that structure, but capital allocation and optimized capital allocation is something that we do.

Speaker #10: Thank you.

Tracy Benguigui: Thank you.

Speaker #3: Your next question comes from the line of Pablo Sing John from JP Morgan. Your line is open. Please go ahead.

Operator: Your next question comes from the line of Pablo Singzon from JPMorgan. Your line is open. Please go ahead.

Pablo Singzon: Hi. Good morning. First one, you had mentioned some of the product enhancements you implemented this quarter in retail annuities, I was wondering if the asset repositioning was also meant to improve your competitive position in the market, was that just more about portfolio and spread optimization?

Speaker #11: Hi. Good morning. First one, you had mentioned some of the product enhancements you implemented this quarter in retail annuities, but I was wondering if the asset repositioning was also meant to improve your competitive position in the market, or was that a just more about portfolio and spread optimization?

Speaker #5: So Pablo, you kind of we lost at the end, but I think we got the gist of your question. It's smart. So I would say that any action that Lisa spoke about tied to the prior questions are enforced management.

Marc Costantini: Pablo, we lost you at the end, I think we got the gist of your question. It's Marc. I would say that any action that Lisa spoke about tied to the prior questions are in force management. We have obviously a pricing matrix and a pricing approach that is very, I would say, robust between Lisa, ALM, and our liability folks on a weekly basis for all of our new business activities. That's how we approach it. Then we optimize the portfolio, the balance sheet as we see obviously the capital markets and the environment around us evolve.

Speaker #5: We have obviously a pricing matrix and a pricing approach that is very I would say robust between Lisa, ALM, and our liability folks on a weekly basis for all of our new business activities.

Speaker #5: So and that's how we approach it. And then we optimize the portfolio and the balance sheet as we see obviously the capital markets and the environment around us evolve.

Pablo Singzon: Got it. That makes sense, Marc. Second question, just on mortality. I wanted to flip it to the longevity and PRT side. I'm aware that the covered populations are exactly the same, but I was wondering if you're seeing some negative offset to the Life Insurance benefit as you look at your pension annuitants potentially living longer. Thank you.

Speaker #11: Got it. That makes sense, Mark. And then, second question, just on mortality—I wanted to flip it to the longevity and PRT side, right?

Speaker #11: So I'm aware that the covered populations are exactly the same, but I was wondering if you're seeing some negative offset to the life insurance benefit as you look at your pension and nuisance potential living longer.

Speaker #11: Thank you.

Speaker #5: Yeah. Thank you very much. Question. Your question is if we're seeing better mortality on the insurance side, are we seeing additional longevity on our PRT business?

Marc Costantini: Yeah. Thank you very much. Your question is if we're seeing better mortality on the insurance side, are we seeing additional longevity on our PRT business? I think you answered your own question when you say a very different population base, very different origination, and very different mortality tables used in both markets to price the business, which is reflective of the actual mortality in each of those markets.

Speaker #5: And I think you mentioned you answered your own question when you say very different population-based, very different origination, and very different mortality tables used in both markets.

Speaker #5: The price of business, which is reflective of the actual mortality in each of those markets.

Speaker #11: Thank you.

Pablo Singzon: Thank you.

Speaker #3: Your next question comes from the line of Joshua Shanker with Bank of America. Your line is open. Please go ahead.

Operator: Your next question comes from the line of Joshua Shanker with Bank of America. Your line is open. Please go ahead.

Speaker #12: Yeah, there was a lot of talk—by the way, thank you for taking my question and good morning—there was a lot of talk about the opportunity in the back half of the year in the PRT market.

Joshua Shanker: Yeah. By the way, thank you for taking my question, and good morning. There was a lot of talk about the opportunity in the back half of the year on the PRT market. I want to understand, are those transaction discussions currently underway, or do you have a high confidence that Corebridge will be the winner of those transactions? Are we in a new sort of era where PRT is a back-half weighted sort of business for you guys?

Speaker #12: I want to understand: Are those transaction discussions currently underway, or do you have a high confidence that Corebridge will be the winner of those transactions?

Speaker #12: And are we in a new sort of era where PRT is a back half-weighted sort of business for you guys?

Speaker #5: Yeah. Thank you, Josh. It's Mark. You're appreciated the question. And I think you've seen some evidence for us that our PRT sales and activity are weighted to the back half.

Marc Costantini: Yeah. Thank you, Josh. It's Mark here. Appreciate that question. I think you've seen some evidence for us that our PRT sales and activity are weighted to the back half. What I think is different in 2026 is that there's been lesser activity in the front half of the year than otherwise we would have seen, which enhances, obviously, the amount of activity we expect in the back half of the year. Now, specifically to Corebridge, we target a certain case size, and we target a certain, I would say, plan type that has both current and deferred kind of retirees that positions us well tied to the prior discussion we just had about mortality, longevity, and expertise in underwriting there.

Speaker #5: What I think is different in 2026 is that there's been less activity in the front half of the year than we otherwise would have seen, which obviously enhances the amount of activity we expect in the back half of the year.

Speaker #5: Now, specifically to Corebridge, we target a certain case size, and we target a certain, I would say, plan type that has both current and deferred retirees. That positioning is also tied to the prior discussion we just had about mortality, longevity, and expertise in underwriting there.

Speaker #5: So, the pipeline for businesses like the PRT business takes four to six months to build by the time the plans— that are very well funded, by the way— and obviously, the interest rate levels are very attractive.

Marc Costantini: The pipeline for businesses like the PRT business takes four to six months to build by the time the plans that are very well funded, by the way, and obviously the interest rate levels are very attractive. That's why we think there'll be robust activity in the back half in combination with the pipeline we see in activity in the market. We do feel we can get the business that we target given the value add we bring to some of those structures, which is why we said what we said about what we see for the balance of the year.

Speaker #5: So that's why we think there'll be robust activity in the back half in combination with the pipeline we see an activity in the market.

Speaker #5: And we do feel we can get the business that we target given the value add we bring to some of those structures, which is why we said what we said about the what we see for the balance of the year.

Speaker #12: But just financing—so the bidding is occurring right now with you and a number of key PRT players?

Joshua Shanker: Just trying to understand, the bidding is occurring right now with you and a number of key PRT players?

Marc Costantini: Sorry, we lost your question there or we didn't come in clear. Can you repeat it?

Speaker #5: Sorry, we kind of lost your question there. You didn't come in clear. Can you repeat it?

Speaker #12: Yeah, I'm just trying to understand. Right now, there's a bidding process—who can execute this best for their customers? Are you and a number of PRT competitors in the bidding process right now, or is this already basically baked into the back half of the year?

Joshua Shanker: Yeah. I'm just trying to understand, right now there's a bidding process, who can execute this best for their customers. Are you and a number of PRT competitors in the bidding process right now, or is this already basically.

Marc Costantini: Yeah

Joshua Shanker: Is this baked into H2?

Speaker #5: Yeah, so I would say it's a combination of everything you're saying. The processes are at different levels of maturity, and we have a sense of where we are in each of the processes.

Marc Costantini: Yeah. I would say it's a combination of everything you're saying. The processes are at different levels of maturity, and we have a sense of where we are in each of the process and how we view kind of our ability to be successful. Now, time will tell on what we're guiding here will happen, but we feel pretty good about our prospects in H2.

Speaker #5: And how we view our ability to be successful now—time will tell whether what we're guiding here will happen, but we feel pretty good about our prospects in the second half of the year.

Speaker #12: Thank you.

Joshua Shanker: Thank you.

Speaker #3: Your next question comes from the line of Wilma Bertis with Raymond James. Your line is open. Please go ahead.

Operator: Your next question comes from the line of Wilma Burdis with Raymond James. Your line is open. Please go ahead.

Wilma Burdis: Hey, good morning. Life Insurance sales were elevated this quarter. Was there anything in particular driving the increase that we can expect going forward for Life sales? Thanks.

Speaker #13: Hey. Good morning. Life insurance says we're elevated this quarter. Is there anything in particular driving the increase that we can expect going forward for life sales?

Speaker #13: Thanks.

Speaker #5: Yeah. Good morning, Wilma. Thank you for your question. I would say we are bullish on our life business. As I mentioned earlier, I expect and want our sales to double over the course of time.

Marc Costantini: Yeah. Good morning, Wilma. Thank you for your question. I would say we are bullish on our Life business. As I mentioned earlier, I expect and want our sales to double over the course of time. We feel we have great distribution opportunity. Some of the things that have been holding us back over the last few years are tied to connectivity to our various distribution. We've been obviously progressively focused on the separation, now we're very much deploying our investment dollars to make sure that we make ourselves the easiest company to do business with, and we make ourselves obviously very easy for our distribution partners to do business with. We're seeing green shoots in our Life business tied to that. I think that's where we see the growth, and that's what's driving the growth of our business.

Speaker #5: We feel we have great distribution opportunity, and some of the things that have been holding us back over the last few years are tied to connectivity to our various distribution.

Speaker #5: We've been obviously probably focused on the separation, and now we're very much deploying our investment dollars to make sure that we make ourselves the easiest company to do business with, and we make ourselves obviously very easy for our distribution partners to do business with.

Speaker #5: And we're seeing green shoots in our life tied to that. I think that's where we see the growth, and that's what's driving the growth of our business.

Marc Costantini: As I mentioned, there's obviously a need for protection across America. There's an unmet need there that we'd like to get ahead of.

Speaker #5: And as I mentioned, there's obviously a need for protection across America, so there's an unmet need there that we'd like to get ahead of.

Marc Costantini: As I mentioned, there's obviously a need for protection across America. There's an unmet need there that we'd like to get ahead of.

Wilma Burdis: Okay. Thank you. Going to kind of combine two questions, pensions are well funded. Do you think that pushes some of the PRT deals into next year? I guess along those lines, I know you touched on it earlier, but maybe you can talk a little bit more about the opportunity to expand institutional business when you combine with Equitable. Thanks.

Speaker #13: Okay. Thank you. And then going to kind of combine two questions, but pensions are well funded. Do you think that pushes some of the PRT deals into next year?

Speaker #13: And then, I guess along those lines—I know you touched on it earlier—but maybe you can talk a little bit more about the opportunity to expand institutional business when you combine with Equitable.

Speaker #13: Thanks.

Speaker #5: Thank you, Wilma. Yeah. So, on the PRT side, I don't have much more to add, except to say that we feel pretty good about the second half of the year, and we feel pretty good about that space in the ensuing years—in 2027 and beyond.

Marc Costantini: Thank you, Wilma. Yeah. On the PRT side, I don't have much more to add than to say that we feel pretty good about H2, and we feel pretty good about that space in the ensuing years in 2027+. One of the implicit kind of questions or comments in this is as we bring together the two balance sheets and our much stronger and bigger capital base and balance sheet, I think that'll give us an opportunity to take bigger sizes of the PRT. When you think about revenue synergies and things we'll talk about more at Investor Day next year, I would say growing our Institutional Markets business across obviously the funding agreement side, as well the PRT side and other services we offer there will be one of the revenue synergies of this merger.

Speaker #5: And one of the implicit kind of questions or comments—and this is, as we bring together the two balance sheets and our much stronger and bigger capital base and balance sheet—I think that will give us an opportunity to take bigger sizes of the PRT.

Speaker #5: So, when you think about revenue synergies—and things we'll talk about more at Investor Day next year—I would say growing our Institutional Markets business across, obviously, the funding agreement side, but as well the PRT side and other services we offer there, will be one of the revenue synergies of this merger.

Speaker #5: Which then speaks to the second half of your question, which is: do we see more opportunity on the spread lending side of our institutional markets business?

Marc Costantini: Which speaks to the second half of your question, which is, do we see more opportunity on the spread lending side of our Institutional Markets business? The answer is yes. As I mentioned in my remarks, 5% or so of our balance sheet is tied to FABN kind of offerings, or that's much greater percent for some of our peers. There's a lot of upside for Corebridge and the new Equitable as we move forward.

Speaker #5: And the answer is yes. And as I mentioned in my remarks, five or so percent of our balance sheet is tied to FABN kind of offerings where that's much greater percentage for some of our peers.

Speaker #5: So there's a lot of upside for Corebridge and the new Equitable as we move forward.

Wilma Burdis: Okay. Thank you.

Speaker #13: Okay. Thank you.

Operator: There are no further questions at this time. Thank you all for attending. This concludes today's call, and you may now disconnect.

Q2 2026 Corebridge Financial Inc Earnings Call

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