AMERICAN EQUITY INVESTMENT LIFE HOLDING CO - FORM 8-K - EX-99.2 - FINANCIAL SUPPLEMENT - August 5, 2020

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Exhibit 99.2



AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement

June 30, 2020


A.
Financial Highlights
 
 
 
 
 
Non-GAAP Financial Measures
 
 
 
 
 
 
 
 
 
 
B.
Product Summary
 
 
 
 
 
 
 
 
 
C.
Investment Summary
 
 
 
 
 
 
 
 
 
D.
 
 
 
E.





AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands)


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
 
June 30, 2020
 
December 31, 2019
Assets
 
 
 
Investments:
 
 
 
Fixed maturity securities, available for sale, at fair value
$
50,738,792

 
$
51,580,490

Mortgage loans on real estate
3,958,233

 
3,448,793

Derivative instruments
672,958

 
1,355,989

Other investments
479,099

 
492,301

Total investments
55,849,082

 
56,877,573

 
 
 
 
Cash and cash equivalents
2,408,635

 
2,293,392

Coinsurance deposits
4,962,859

 
5,115,013

Accrued investment income
450,290

 
472,826

Deferred policy acquisition costs
2,920,793

 
2,923,454

Deferred sales inducements
1,937,083

 
1,966,723

Income taxes recoverable
35,962

 
—

Other assets
43,592

 
47,571

Total assets
$
68,608,296

 
$
69,696,552

 
 
 
 
Liabilities and Stockholders' Equity
 
 
 
Liabilities:
 
 
 
Policy benefit reserves
$
61,669,232

 
$
61,893,945

Other policy funds and contract claims
244,186

 
256,105

Notes payable
495,388

 
495,116

Subordinated debentures
77,964

 
157,265

Deferred income taxes
229,757

 
177,897

Income taxes payable
—

 
429

Other liabilities
829,710

 
2,145,676

Total liabilities
63,546,237

 
65,126,433

 
 
 
 
Stockholders' equity:
 
 
 
Preferred stock, Series A
16

 
16

Preferred stock, Series B
12

 
—

Common stock
91,595

 
91,107

Additional paid-in capital
1,508,171

 
1,212,311

Accumulated other comprehensive income
1,719,839

 
1,497,921

Retained earnings
1,742,426

 
1,768,764

Total stockholders' equity
5,062,059

 
4,570,119

Total liabilities and stockholders' equity
$
68,608,296

 
$
69,696,552




Page 1


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands, except per share data)


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
 
Three Months Ended 
 June 30,
 
Six Months Ended 
 June 30,
 
2020
 
2019
 
2020
 
2019
Revenues:
 
 
 
 
 
 
 
Premiums and other considerations
$
11,032

 
$
4,126

 
$
18,696

 
$
9,536

Annuity product charges
63,438

 
60,700

 
122,987

 
113,666

Net investment income
543,704

 
570,568

 
1,117,022

 
1,129,006

Change in fair value of derivatives
327,662

 
76,045

 
(614,212
)
 
460,514

Net realized gains (losses) on investments
(25,888
)
 
(3,832
)
 
(46,224
)
 
(4,395
)
Other than temporary impairment (OTTI) losses on investments:
 
 
 
 
 
 
 
Total OTTI losses
—

 
(998
)
 
—

 
(998
)
Portion of OTTI losses recognized from other comprehensive income
—

 
(215
)
 
—

 
(215
)
Net OTTI losses recognized in operations
—

 
(1,213
)
 
—

 
(1,213
)
Loss on extinguishment of debt
—

 
—

 
(2,024
)
 
—

Total revenues
919,948

 
706,394

 
596,245

 
1,707,114

 
 
 
 
 
 
 
 
Benefits and expenses:
 
 
 
 
 
 
 
Insurance policy benefits and change in future policy benefits
13,331

 
6,939

 
23,403

 
16,238

Interest sensitive and index product benefits
240,992

 
251,103

 
641,211

 
387,777

Amortization of deferred sales inducements
(75,178
)
 
19,785

 
(1,587
)
 
53,094

Change in fair value of embedded derivatives
1,126,935

 
327,562

 
(123,126
)
 
1,093,885

Interest expense on notes payable
6,388

 
6,380

 
12,773

 
12,759

Interest expense on subordinated debentures
1,321

 
4,057

 
2,909

 
8,145

Amortization of deferred policy acquisition costs
(119,889
)
 
29,946

 
813

 
75,078

Other operating costs and expenses
41,951

 
37,426

 
85,577

 
76,405

Total benefits and expenses
1,235,851

 
683,198

 
641,973

 
1,723,381

Income (loss) before income taxes
(315,903
)
 
23,196

 
(45,728
)
 
(16,267
)
Income tax expense (benefit)
(68,474
)
 
4,606

 
(41,246
)
 
(4,847
)
Net income (loss)
(247,429
)
 
18,590

 
(4,482
)
 
(11,420
)
Less: Preferred stock dividends
5,950

 
—

 
12,561

 
—

Net income (loss) available to common stockholders
$
(253,379
)

$
18,590

 
$
(17,043
)
 
$
(11,420
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Earnings (loss) per common share
$
(2.76
)
 
$
0.20

 
$
(0.19
)
 
$
(0.13
)
Earnings (loss) per common share - assuming dilution
$
(2.76
)
 
$
0.20

 
$
(0.19
)
 
$
(0.13
)
 
 
 
 
 
 
 
 
Weighted average common shares outstanding (in thousands):
 
 
 
 
 
 
 
Earnings (loss) per common share
91,803

 
91,103

 
91,724

 
90,994

Earnings (loss) per common share - assuming dilution
92,027

 
91,785

 
92,024

 
91,765



Page 2


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands, except per share data)


Quarterly Summary - Most Recent 5 Quarters
 
Q2 2020
 
Q1 2020
 
Q4 2019
 
Q3 2019
 
Q2 2019
Revenues:
 
 
 
 
 
 
 
 
 
Traditional life insurance premiums
$
722

 
$
823

 
$
762

 
$
778

 
$
799

Life contingent immediate annuity considerations
10,310

 
6,841

 
8,084

 
4,374

 
3,327

Surrender charges
19,390

 
19,705

 
15,092

 
20,537

 
19,480

Lifetime income benefit rider fees
44,048

 
39,844

 
47,630

 
43,110

 
41,220

Net investment income
543,704

 
573,318

 
588,217

 
590,412

 
570,568

Change in fair value of derivatives
327,662

 
(941,874
)
 
466,434

 
(20,042
)
 
76,045

Net realized gains (losses) on investments
(25,888
)
 
(20,336
)
 
7,029

 
4,328

 
(3,832
)
Net OTTI losses recognized in operations
—

 
—

 
(17,412
)
 
(101
)
 
(1,213
)
Loss on extinguishment of debt
—

 
(2,024
)
 
(2,001
)
 
—

 
—

Total revenues
919,948

 
(323,703
)
 
1,113,835

 
643,396

 
706,394

 
 
 
 
 
 
 
 
 
 
Benefits and expenses:
 
 
 
 
 
 
 
 
 
Traditional life insurance policy benefits and change in future policy benefits
702

 
621

 
835

 
758

 
576

Life contingent immediate annuity benefits and change in future policy benefits
12,629

 
9,451

 
10,718

 
6,869

 
6,363

Interest sensitive and index product benefits (a)
240,992

 
400,219

 
399,514

 
500,285

 
251,103

Amortization of deferred sales inducements (b)(c)
(75,178
)
 
73,591

 
91,260

 
(55,769
)
 
19,785

Change in fair value of embedded derivatives (b)(d)
1,126,935

 
(1,250,061
)
 
147,879

 
212,278

 
327,562

Interest expense on notes payable
6,388

 
6,385

 
6,384

 
6,382

 
6,380

Interest expense on subordinated debentures
1,321

 
1,588

 
3,651

 
3,968

 
4,057

Amortization of deferred policy acquisition costs (b)(c)
(119,889
)
 
120,702

 
133,573

 
(120,934
)
 
29,946

Other operating costs and expenses
41,951

 
43,626

 
39,194

 
38,554

 
37,426

Total benefits and expenses
1,235,851

 
(593,878
)
 
833,008

 
592,391

 
683,198

Income (loss) before income taxes
(315,903
)
 
270,175

 
280,827

 
51,005

 
23,196

Income tax expense (benefit) (e)
(68,474
)
 
27,228

 
60,677

 
13,645

 
4,606

Net income (loss) (a)(b)(c)(d)(e)
(247,429
)
 
242,947

 
220,150

 
37,360

 
18,590

Less: Preferred stock dividends
5,950

 
6,611

 
—

 
—

 
—

Net income (loss) available to common stockholders (a)(b)(c)(d)(e)
$
(253,379
)

$
236,336


$
220,150


$
37,360


$
18,590

 
 
 
 
 
 
 
 
 
 
Earnings (loss) per common share
$
(2.76
)
 
$
2.58

 
$
2.41

 
$
0.41

 
$
0.20

Earnings (loss) per common share - assuming dilution (a)(b)(c)(d)(e)
$
(2.76
)
 
$
2.57

 
$
2.40

 
$
0.41

 
$
0.20

 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding (thousands):
 
 
 
 
 
 
 
 
 
Earnings (loss) per common share
91,803

 
91,644

 
91,314

 
91,252

 
91,103

Earnings (loss) per common share - assuming dilution
92,027

 
92,021

 
91,883

 
91,711

 
91,785

(a)
Q3 2019 includes expense from the revision of assumptions used in determining reserves held for lifetime income benefit riders. The impact increased interest sensitive and index product benefits by $315.4 million and decreased both net income and net income available to common stockholders by $247.3 million and decreased earnings per common share - assuming dilution by $2.70 per share.
(b)
Q2 2020 includes a benefit from the revision of assumptions used in determining the embedded derivative component of our fixed index annuity policy benefit reserves. The impact decreased change in fair value of embedded derivatives by $230.1 million, increased amortization of deferred sales inducements and deferred policy acquisition costs by $36.7 million and $57.6 million, respectively, and decreased both net loss and net loss available to common stockholders by $106.5 million and reduced loss per common share - assuming dilution by $1.16 per share.
(c)
Q3 2019 includes a benefit from unlocking which reduced amortization of deferred sales inducements and deferred policy acquisition costs by $104.7 million and $193.0 million, respectively, and increased both net income and net income available to common stockholders by $233.4 million and increased earnings per common share - assuming dilution by $2.54 per share.
(d)
Q3 2019 includes expense from the revision of assumptions used in determining the embedded derivative component of our fixed index annuity policy benefit reserves. The impact increased change in fair value of embedded derivatives by $28.2 million and decreased both net income and net income available to common stockholders by $22.1 million and decreased earnings per common share - assuming dilution by $0.24 per share.
(e)
Q1 2020 includes a tax benefit related to the provision of the Coronavirus Aid, Relief, and Economic Security Act, (“the CARES ACT”)  which was signed into legislation on March 27, 2020 and allows net operating losses for 2018 through 2020 to be carried back to previous tax years in which a 35% statutory tax rate was in effect. The impact reduced income tax expense and increased both net income and net income available to common stockholders by $30.8 million and increased earnings per common share - assuming dilution by $0.33 per share.

Page 3


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands, except per share data)


NON-GAAP FINANCIAL MEASURES
In addition to net income (loss) available to common stockholders, we have consistently utilized non-GAAP operating income available to common stockholders and non-GAAP operating income available to common stockholders per common share - assuming dilution, non-GAAP financial measures commonly used in the life insurance industry, as economic measures to evaluate our financial performance. Non-GAAP operating income available to common stockholders equals net income (loss) available to common stockholders adjusted to eliminate the impact of items that fluctuate from quarter to quarter in a manner unrelated to core operations, and we believe measures excluding their impact are useful in analyzing operating trends. The most significant adjustments to arrive at non-GAAP operating income available to common stockholders eliminate the impact of fair value accounting for our fixed index annuity business. These adjustments are not economic in nature but rather impact the timing of reported results. We believe the combined presentation and evaluation of non-GAAP operating income available to common stockholders together with net income (loss) available to common stockholders provides information that may enhance an investor’s understanding of our underlying results and profitability.
Reconciliation from Net Income (Loss) Available to Common Stockholders to Non-GAAP Operating Income Available to Common Stockholders
 
Three Months Ended 
 June 30,
 
Six Months Ended 
 June 30,
 
2020
 
2019
 
2020
 
2019
Net income (loss) available to common stockholders
$
(253,379
)
 
$
18,590

 
$
(17,043
)
 
$
(11,420
)
Adjustments to arrive at non-GAAP operating income available to common stockholders: (a)
 
 
 
 
 
 
 
Net realized gains/losses on financial assets, including credit losses
18,492

 
2,625

 
34,841

 
2,930

Change in fair value of derivatives and embedded derivatives - fixed index annuities
423,590

 
99,868

 
303,136

 
250,812

Change in fair value of derivatives - interest rate caps and swap
—

 
854

 
(848
)
 
1,490

Income taxes
(95,599
)
 
(22,346
)
 
(72,897
)
 
(54,819
)
Non-GAAP operating income available to common stockholders
$
93,104

 
$
99,591

 
$
247,189

 
$
188,993

 
 
 
 
 
 
 
 
Per common share - assuming dilution:
 
 
 
 
 
 
 
Net income (loss) available to common stockholders
$
(2.76
)
 
$
0.20

 
$
(0.19
)
 
$
(0.13
)
Adjustments to arrive at non-GAAP operating income available to common stockholders:
 
 
 
 
 
 
 
Anti-dilutive effect of net loss
0.01

 
—

 
—

 
0.01

Net realized gains/losses on financial assets, including credit losses
0.20

 
0.03

 
0.38

 
0.03

Change in fair value of derivatives and embedded derivatives - fixed index annuities
4.60

 
1.09

 
3.30

 
2.73

Change in fair value of derivatives - interest rate caps and swap
—

 
0.01

 
(0.01
)
 
0.02

Income taxes
(1.04
)
 
(0.24
)
 
(0.79
)
 
(0.60
)
Non-GAAP operating income available to common stockholders
$
1.01

 
$
1.09

 
$
2.69

 
$
2.06

(a)
Adjustments to net income (loss) available to common stockholders to arrive at non-GAAP operating income available to common stockholders are presented net of related adjustments to amortization of deferred sales inducements (DSI) and deferred policy acquisition costs (DAC) where applicable.

Page 4


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands)


NON-GAAP FINANCIAL MEASURES
Summary of Adjustments to Arrive at Non-GAAP Operating Income Available to Common Stockholders
 
Three Months Ended 
 June 30,
 
Six Months Ended 
 June 30,
 
2020
 
2019
 
2020
 
2019
Net realized gains/losses on financial assets, including credit losses:
 
 
 
 
 
 
 
Net realized gains/losses on financial assets, including credit losses
$
25,276

 
$
5,045

 
$
46,933

 
$
5,608

Amortization of DAC and DSI
(6,784
)
 
(2,420
)
 
(12,092
)
 
(2,678
)
Income taxes
(3,995
)
 
(567
)
 
(7,526
)
 
(633
)
 
$
14,497

 
$
2,058

 
$
27,315

 
$
2,297

Change in fair value of derivatives and embedded derivatives:
 
 
 
 
 
 
 
Fixed index annuities
$
713,446

 
$
218,046

 
$
503,555

 
$
459,166

Interest rate caps and swap
—

 
854

 
(848
)
 
1,490

Amortization of DAC and DSI
(289,856
)
 
(118,178
)
 
(200,419
)
 
(208,354
)
Income taxes
(91,604
)
 
(21,779
)
 
(65,371
)
 
(54,186
)
 
$
331,986

 
$
78,943

 
$
236,917

 
$
198,116



Page 5


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands, except per share data)


NON-GAAP FINANCIAL MEASURES
Quarterly Summary - Most Recent 5 Quarters
Reconciliation from Net Income (Loss) Available to Common Stockholders to Non-GAAP Operating Income Available to Common Stockholders
 
Q2 2020
 
Q1 2020
 
Q4 2019
 
Q3 2019
 
Q2 2019
Net income (loss) available to common stockholders
$
(253,379
)
 
$
236,336

 
$
220,150

 
$
37,360

 
$
18,590

Adjustments to arrive at non-GAAP operating income available to common stockholders: (a)
 
 
 
 
 
 
 
 
 
Net realized gains/losses on financial assets, including credit losses
18,492

 
16,349

 
7,606

 
(3,175
)
 
2,625

Change in fair value of derivatives and embedded derivatives -
fixed index annuities
423,590

 
(120,454
)
 
(127,777
)
 
250,186

 
99,868

Change in fair value of derivatives - interest rate caps and swap
—

 
(848
)
 
(167
)
 
(76
)
 
854

Income taxes
(95,599
)
 
22,702

 
26,023

 
(50,940
)
 
(22,346
)
Non-GAAP operating income available to common stockholders (b)(c)(d)
$
93,104

 
$
154,085

 
$
125,835

 
$
233,355

 
$
99,591

 
 
 
 
 
 
 
 
 
 
Per common share - assuming dilution:
 
 
 
 
 
 
 
 
 
Net income (loss) available to common stockholders
$
(2.76
)
 
$
2.57

 
$
2.40

 
$
0.41

 
$
0.20

Adjustments to arrive at non-GAAP operating income available to common stockholders:
 
 
 
 
 
 
 
 
 
Anti-dilutive effect of net loss
0.01

 
—

 
—

 
—

 
—

Net realized gains/losses on financial assets, including credit losses
0.20

 
0.17

 
0.08

 
(0.04
)
 
0.03

Change in fair value of derivatives and embedded derivatives - fixed index annuities
4.60

 
(1.31
)
 
(1.39
)
 
2.73

 
1.09

Change in fair value of derivatives - interest rate caps and swap
—

 
(0.01
)
 
—

 
—

 
0.01

Income taxes
(1.04
)
 
0.25

 
0.28

 
(0.56
)
 
(0.24
)
Non-GAAP operating income available to common stockholders (b)(c)(d)
$
1.01

 
$
1.67

 
$
1.37

 
$
2.54

 
$
1.09

(a)
Adjustments to net income (loss) available to common stockholders to arrive at non-GAAP operating income available to common stockholders are presented net of related adjustments to amortization of deferred sales inducements and deferred policy acquisition costs where applicable.
(b)
Q3 2019 includes expense from the revision of assumptions used in determining reserves held for lifetime income benefit riders. The impact increased interest sensitive and index product benefits by $315.4 million and decreased non-GAAP operating income available to common stockholders and non-GAAP operating income available to common stockholders per common share - assuming dilution by $247.3 million and $2.70 per share, respectively.
(c)
Q3 2019 includes a benefit from unlocking which reduced amortization of deferred sales inducements and deferred policy acquisition costs by $184.9 million and $288.3 million, respectively, and increased non-GAAP operating income available to common stockholders and non-GAAP operating income available to common stockholders per common share- assuming dilution by $371.0 million and $4.05 per share, respectively.
(d)
Q1 2020 includes a tax benefit related to the provision of the CARES ACT which was signed into legislation on March 27, 2020 and allows net operating losses for 2018 through 2020 to be carried back to previous tax years in which a 35% statutory tax rate was in effect. The impact reduced income tax expense and increased non-GAAP operating income available to common stockholders and non-GAAP operating income available to common stockholders per common share - assuming dilution by $30.8 million and $0.33 per share, respectively.

Page 6


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands)


NON-GAAP FINANCIAL MEASURES
Summary of Adjustments to Arrive at Non-GAAP Operating Income Available to Common Stockholders
 
Q2 2020
 
Q1 2020
 
Q4 2019
 
Q3 2019
 
Q2 2019
Net realized (gains) losses on investments
$
25,888

 
$
20,336

 
$
(7,029
)
 
$
(4,328
)
 
$
3,832

Net OTTI losses recognized in operations
—

 
—

 
17,412

 
101

 
1,213

Change in fair value of derivatives
(413,489
)
 
1,039,322

 
(370,973
)
 
(79,943
)
 
(108,662
)
Increase (decrease) in total revenues
(387,601
)
 
1,059,658

 
(360,590
)
 
(84,170
)
 
(103,617
)
 
 
 
 
 
 
 
 
 
 
Amortization of deferred sales inducements
115,511

 
(29,683
)
 
(37,374
)
 
(57,408
)
 
49,101

Change in fair value of embedded derivatives
(1,126,935
)
 
1,250,061

 
(147,879
)
 
(212,278
)
 
(327,562
)
Interest sensitive and index product benefits (a)
612

 
(1,321
)
 
—

 
—

 
—

Amortization of deferred policy acquisition costs
181,129

 
(54,446
)
 
(54,999
)
 
(61,419
)
 
71,497

Increase (decrease) in total benefits and expenses
(829,683
)
 
1,164,611

 
(240,252
)
 
(331,105
)
 
(206,964
)
Increase in income (loss) before income taxes
442,082

 
(104,953
)
 
(120,338
)
 
246,935

 
103,347

Increase (decrease) in income tax expense (benefit)
95,599

 
(22,702
)
 
(26,023
)
 
50,940

 
22,346

Increase (decrease) in net income (loss) available to common stockholders
$
346,483

 
$
(82,251
)
 
$
(94,315
)
 
$
195,995

 
$
81,001

(a)
Interest sensitive and index product benefits adjustment reflects the change in the allowance for credit losses on our reinsurance recoverable/coinsurance deposits under a revised impairment model for financial assets measured at amortized cost which we were required to adopt on January 1, 2020. The change in this allowance is reflected in the net realized gains/losses of financial assets, including credit losses line in the other Non-GAAP financial measures tables in this financial supplement.

Page 7


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands, except share and per share data)


Capitalization/Book Value per Common Share
 
Q2 2020
 
Q1 2020
 
Q4 2019
 
Q3 2019
 
Q2 2019
Capitalization:
 
 
 
 
 
 
 
 
 
Notes payable
$
500,000

 
$
500,000

 
$
500,000

 
$
500,000

 
$
500,000

Subordinated debentures payable to subsidiary trusts
77,964

 
77,893

 
159,272

 
247,362

 
247,294

Total debt
577,964

 
577,893


659,272


747,362


747,294

Total stockholders’ equity
5,062,059

 
3,522,757

 
4,570,119

 
4,126,716

 
3,497,475

Total capitalization
5,640,023

 
4,100,650


5,229,391


4,874,078


4,244,769

Accumulated other comprehensive income (AOCI)
(1,719,839
)
 
(219,974
)
 
(1,497,921
)
 
(1,639,429
)
 
(1,049,984
)
Total capitalization excluding AOCI (a)
$
3,920,184

 
$
3,880,676


$
3,731,470


$
3,234,649


$
3,194,785

 
 
 
 
 
 
 
 
 
 
Total stockholders’ equity
$
5,062,059

 
$
3,522,757


$
4,570,119


$
4,126,716


$
3,497,475

Equity available to preferred stockholders (b)
(700,000
)
 
(400,000
)
 
(400,000
)
 
—

 
—

Total common stockholders' equity (c)
4,362,059


3,122,757


4,170,119


4,126,716


3,497,475

Accumulated other comprehensive income
(1,719,839
)
 
(219,974
)

(1,497,921
)

(1,639,429
)

(1,049,984
)
Total common stockholders’ equity excluding AOCI (c)
2,642,220


2,902,783


2,672,198


2,487,287


2,447,491

Net impact of fair value accounting for derivatives and embedded derivatives
685,839

 
353,853

 
448,924

 
549,202

 
353,180

Total common stockholders’ equity excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives (c)
$
3,328,059

 
$
3,256,636

 
$
3,121,122

 
$
3,036,489

 
$
2,800,671

 
 
 
 
 
 
 
 
 
 
Common shares outstanding
91,595,066

 
91,497,841

 
91,107,555

 
91,006,950

 
90,936,324

 
 
 
 
 
 
 
 
 
 
Book Value per Common Share: (d)
 
 
 
 
 
 
 
 
 
Book value per common share (c)
$
47.62


$
34.13


$
45.77


$
45.35


$
38.46

Book value per common share excluding AOCI (c)
$
28.85


$
31.73


$
29.33


$
27.33


$
26.91

Book value per common share excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives (c)
$
36.33

 
$
35.59

 
$
34.26

 
$
33.37

 
$
30.80

 
 
 
 
 
 
 
 
 
 
Debt-to-Capital Ratios: (e)
 
 
 
 
 
 
 
 
 
Senior debt / Total capitalization
12.8
%
 
12.9
%

13.4
%

15.5
%

15.7
%
Total debt / Total capitalization
14.7
%

14.9
%

17.7
%

23.1
%

23.4
%
(a)
Total capitalization excluding AOCI, a non-GAAP financial measure, is based on stockholders' equity excluding the effect of AOCI.
(b)
Equity available to preferred stockholders is equal to the redemption value of outstanding preferred stock plus share dividends declared but not yet issued.
(c)
Total common stockholders' equity, total common stockholder's equity excluding AOCI and total common stockholders' equity excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives, non-GAAP financial measures, exclude equity available to preferred stockholders. Total common stockholders’ equity and book value per common share excluding AOCI, non-GAAP financial measures, are based on common stockholders’ equity excluding the effect of AOCI. Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale securities, we believe these non-GAAP financial measures provide useful supplemental information. Total common stockholders' equity and book value per common share excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives, non-GAAP financial measures, are based on common stockholders' equity excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives. Since the net impact of fair value accounting for our derivatives and embedded derivatives fluctuates from quarter to quarter and the most significant impacts relate to fair value accounting for our fixed index annuity business and are not economic in nature but rather impact the timing of reported results, we believe these non-GAAP financial measures provide useful supplemental information.
(d)
Book value per common share including and excluding AOCI and book value per common share excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives are calculated as total common stockholders’ equity, total common stockholders’ equity excluding AOCI and total common stockholders' equity excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives divided by the total number of shares of common stock outstanding.
(e)
Debt-to-capital ratios are computed using total capitalization excluding AOCI.
 

Page 8


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands)


Spread Results
Six Months Ended 
 June 30,
 
 
 
 
 
 
 
 
 
 
2020
 
2019
 
Q2 2020
 
Q1 2020
 
Q4 2019
 
Q3 2019
 
Q2 2019
4.24%
 
4.49%
Average yield on invested assets
4.12%
 
4.36%
 
4.52%
 
4.59%
 
4.51%
1.73%
 
1.89%
Aggregate cost of money
1.73%
 
1.72%
 
1.75%
 
1.84%
 
1.88%
2.51%
 
2.60%
Aggregate investment spread
2.39%
 
2.64%
 
2.77%
 
2.75%
 
2.63%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Impact of:
 
 
 
 
 
 
 
 
 
0.04%
 
0.03%
Investment yield - additional prepayment income
0.03%
 
0.06%
 
0.12%
 
0.11%
 
0.04%
0.02%
 
0.03%
Cost of money effect of over (under) hedging
(0.01)%
 
0.05%
 
0.05%
 
0.02%
 
0.04%
 
 
 
 
 
 
 
 
 
 
 
 
 
$52,762,227
 
$50,309,342
Weighted average investments
$52,901,215
 
$52,623,239
 
$52,141,459
 
$51,529,850
 
$50,709,966
Weighted average investments include fixed maturity securities at amortized cost and mortgage loans on real estate and other investments at carrying values as reflected in the consolidated balance sheets. The numerator for average yield on invested assets includes net investment income and the tax effect of investment income that is exempt from income taxes.
Summary of Cost of Money for Deferred Annuities
Six Months Ended 
 June 30,
 
 
 
 
 
 
 
 
 
 
2020
 
2019
 
Q2 2020
 
Q1 2020
 
Q4 2019
 
Q3 2019
 
Q2 2019
 
 
 
Included in interest sensitive and index product benefits:
 
 
 
 
 
 
 
 
 
$
376,815

 
$
217,677

Index credits
$
97,875

 
$
278,940

 
$
277,798

 
$
92,343

 
$
161,752

95,541

 
97,914

Interest credited
46,594

 
48,947

 
49,482

 
49,511

 
50,478

 
 
 
Included in change in fair value of derivatives:
 
 
 
 
 
 
 
 
 
(382,278
)
 
(224,890
)
Proceeds received at option expiration
(97,015
)
 
(285,263
)
 
(284,624
)
 
(95,491
)
 
(166,430
)
369,871

 
397,503

Pro rata amortization of option cost
182,841

 
187,030

 
188,984

 
195,354

 
199,006

$
459,949

 
$
488,204

Cost of money for deferred annuities
$
230,295

 
$
229,654


$
231,640


$
241,717


$
244,806

 
 
 
 
 
 
 
 
 
 
 
 
 
$
53,244,580

 
$
51,669,061

Weighted average liability balance outstanding
$
53,214,255

 
$
53,274,905

 
$
53,092,419

 
$
52,682,886

 
$
52,009,407

Annuity Account Balance Rollforward
Six Months Ended 
 June 30,
 
 
 
 
 
 
 
 
 
 
2020
 
2019
 
Q2 2020
 
Q1 2020
 
Q4 2019
 
Q3 2019
 
Q2 2019
$
53,233,898

 
$
51,053,450

Account balances at beginning of period
$
53,315,909

 
$
53,233,898

 
$
52,950,937

 
$
52,414,835

 
$
51,603,979

1,224,778

 
2,605,690

Net deposits
543,026

 
681,752

 
838,761

 
1,216,720

 
1,425,325

47,262

 
93,991

Premium bonuses
22,710

 
24,552

 
36,983

 
46,968

 
48,370

472,356

 
315,591

Fixed interest credited and index credits
144,469

 
327,887

 
327,280

 
141,854

 
212,230

(39,095
)
 
(35,936
)
Surrender charges
(19,390
)
 
(19,705
)
 
(15,092
)
 
(20,537
)
 
(19,480
)
(83,892
)
 
(77,730
)
Lifetime income benefit rider fees
(44,048
)
 
(39,844
)
 
(47,630
)
 
(43,110
)
 
(41,220
)
(1,742,707
)
 
(1,540,221
)
Surrenders, withdrawals, deaths, etc.
(850,076
)
 
(892,631
)
 
(857,341
)
 
(805,793
)
 
(814,369
)
$
53,112,600

 
$
52,414,835

Account balances at end of period
$
53,112,600

 
$
53,315,909

 
$
53,233,898

 
$
52,950,937

 
$
52,414,835


Page 9


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands)


Annuity Deposits by Product Type
Six Months Ended 
 June 30,
 
 
 
 
 
 
 
 
 
 
2020
 
2019
 
Q2 2020
 
Q1 2020
 
Q4 2019
 
Q3 2019
 
Q2 2019
 
 
 
American Equity Life:
 
 
 
 
 
 
 
 
 
$
1,058,962

 
$
2,238,662

Fixed index annuities
$
472,899

 
$
586,063

 
$
765,180

 
$
1,054,796

 
$
1,211,004

4,647

 
7,062

Annual reset fixed rate annuities
2,316

 
2,331

 
1,843

 
2,340

 
3,614

452

 
714

Multi-year fixed rate annuities
83

 
369

 
306

 
593

 
566

15,482

 
3,815

Single premium immediate annuities
10,084

 
5,398

 
4,873

 
3,314

 
1,747

1,079,543

 
2,250,253

 
485,382

 
594,161

 
772,202

 
1,061,043

 
1,216,931

 
 
 
Eagle Life:
 
 
 
 
 
 
 
 
 
178,873

 
413,038

Fixed index annuities
72,371

 
106,502

 
67,784

 
166,081

 
235,558

58

 
193

Annual reset fixed rate annuities
17

 
41

 
6

 
—

 
66

5,180

 
72,572

Multi-year fixed rate annuities
1,031

 
4,149

 
81,041

 
79,000

 
47,004

184,111

 
485,803

 
73,419

 
110,692

 
148,831

 
245,081

 
282,628

 
 
 
Consolidated:
 
 
 
 
 
 
 
 
 
1,237,835

 
2,651,700

Fixed index annuities
545,270

 
692,565

 
832,964

 
1,220,877

 
1,446,562

4,705

 
7,255

Annual reset fixed rate annuities
2,333


2,372


1,849


2,340


3,680

5,632

 
73,286

Multi-year fixed rate annuities
1,114

 
4,518

 
81,347

 
79,593

 
47,570

15,482

 
3,815

Single premium immediate annuities
10,084

 
5,398

 
4,873

 
3,314

 
1,747

1,263,654

 
2,736,056

Total before coinsurance ceded
558,801

 
704,853

 
921,033

 
1,306,124

 
1,499,559

23,394

 
126,551

Coinsurance ceded
5,691

 
17,703

 
77,399

 
86,090

 
72,487

$
1,240,260

 
$
2,609,505

Net after coinsurance ceded
$
553,110

 
$
687,150

 
$
843,634

 
$
1,220,034

 
$
1,427,072

Surrender Charge Protection and Account Values by Product Type
Annuity Surrender Charges and Net (of Coinsurance) Account Values at June 30, 2020:
 
 
Surrender Charge
 
Net Account Value
Product Type
 
Avg.
Years
At Issue
 
Avg.
Years
Remaining
 
Avg.
%
Remaining
 
Dollars in Thousands
 
%
Fixed Index Annuities
 
12.9
 
6.6
 
10.7%
 
$
51,122,612

 
96.3
%
Annual Reset Fixed Rate Annuities
 
9.4
 
3.2
 
6.1%
 
1,403,321

 
2.6
%
Multi-Year Fixed Rate Annuities
 
5.9
 
1.6
 
4.6%
 
586,667

 
1.1
%
Total
 
12.7
 
6.5
 
10.5%
 
$
53,112,600

 
100.0
%



Page 10


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands)


Annuity Liability Characteristics
Surrender Charge Percentages:
Fixed
Annuities
Account Value
 
Fixed Index
Annuities
Account Value
No surrender charge
$
811,287

 
$
2,740,676

0.0% < 2.0%
16,674

 
272,742

2.0% < 3.0%
18,180

 
1,059,162

3.0% < 4.0%
62,253

 
1,813,373

4.0% < 5.0%
66,625

 
1,629,546

5.0% < 6.0%
243,420

 
3,045,822

6.0% < 7.0%
94,673

 
1,169,623

7.0% < 8.0%
82,992

 
5,209,088

8.0% < 9.0%
44,361

 
4,048,053

9.0% < 10.0%
79,797

 
3,937,052

10.0% or greater
469,726

 
26,197,475

 
$
1,989,988

 
$
51,122,612

Surrender Charge Expiration By Year:
Fixed and
Fixed Index
Annuities
Account Value
 
Weighted
Average
Surrender
Charge
Out of Surrender Charge
$
3,551,963

 
0.00
%
2020
466,472

 
2.62
%
2021
1,205,030

 
3.67
%
2022
1,718,514

 
4.67
%
2023
4,127,620

 
5.36
%
2024
5,140,087

 
7.22
%
2025
6,002,725

 
8.49
%
2026
5,229,759

 
10.10
%
2027
4,456,516

 
11.67
%
2028
4,726,844

 
12.59
%
2029
5,980,906

 
13.84
%
2030
3,228,720

 
15.92
%
2031
2,984,563

 
17.74
%
2032
2,030,436

 
18.26
%
2033
1,169,013

 
18.68
%
2034
698,437

 
19.17
%
2035
318,637

 
19.70
%
2036
76,358

 
20.00
%
 
$
53,112,600

 
10.47
%

Page 11


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands)


Annuity Liability Characteristics
Credited Rate vs. Ultimate Minimum Guaranteed Rate Differential:
Fixed
Annuities
Account Value
 
Fixed Index
Annuities
Account Value
No differential
$
944,032

 
$
1,275,851

› 0.0% - 0.25%
49,125

 
153,052

› 0.25% - 0.5%
237,473

 
5,638

› 0.5% - 1.0%
34,082

 
10,596

› 1.0% - 1.5%
11,491

 
—

› 2.0% - 2.5%
238

 
—

Greater than 3.0%
2,757

 
—

1.00% ultimate guarantee - 2.36% wtd avg interest rate (a)
441,111

 
812,678

1.50% ultimate guarantee - 1.14% wtd avg interest rate (a)
142,690

 
3,300,429

1.75% ultimate guarantee - 1.96% wtd avg interest rate (a)
49,338

 
517,285

2.00% ultimate guarantee - 1.85% wtd avg interest rate (a)
77,651

 
—

2.25% ultimate guarantee - 1.75% wtd avg interest rate (a)
—

 
758,107

2.25% ultimate guarantee - 2.00% wtd avg interest rate (a)
—

 
1,471,865

Allocated to index strategies (see tables that follow)
—

 
42,817,111

 
$
1,989,988

 
$
51,122,612

(a)
The minimum guaranteed interest rate for the fixed rate or the fixed rate strategy is 1.00%. The ultimate guaranteed rate is applied on less than 100% of the premium.
If all crediting rates were reduced to minimum guaranteed rates (subject to limitations imposed by ultimate minimum guaranteed rates where applicable) the weighted average crediting rate as of June 30, 2020 for fixed annuities and funds allocated to the fixed rate strategy for fixed index annuities would decrease by 0.14%.

Page 12


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands)


Annuity Liability Characteristics
FIXED INDEX ANNUITIES ACCOUNT VALUE - INDEX STRATEGIES
    
Annual Monthly Average and Point-to-Point with Caps
 
Minimum Guaranteed Cap
 
1%
 
3%
 
4%
 
7%
 
8% +
Current Cap
 
 
 
 
 
 
 
 
 
At minimum
$
1,418

 
$
100,762

 
$
4,915,126

 
$
61,573

 
$
83,976

1.75% - 3%
8,452,761

 
—

 
—

 
—

 
—

3% - 4%
269,501

 
3,651

 
—

 
—

 
—

4% - 5%
890,045

 
218,620

 
1,394,195

 
—

 
—

5% - 6%
528,022

 
186,089

 
30,599

 
—

 
—

6% - 7%
—

 
—

 
444

 
—

 
—

>= 7%
10,694

 
6,334

 
716

 
5,510

 
—

Annual Monthly Average and Point-to-Point with Participation Rates
 
Minimum Guaranteed Participation Rate
 
10%
 
20% - 25%
 
35%
 
50% +
Current Participation Rate
 
 
 
 
 
 
 
At minimum
$
52,121

 
$
392,105

 
$
94,250

 
$
98,941

< 20%
867,652

 
—

 
—

 
—

20% - 40%
1,286,560

 
171,053

 
—

 
—

40% - 60%
3,196,216

 
96,904

 
57,801

 
—

60% - 100%
573,225

 
—

 
—

 
—

> 100%
473,490

 
—

 
—

 
—

S&P 500 Monthly Point-to-Point - Minimum Guaranteed Monthly Cap = 1.0%
Current Cap
 
At minimum
$
2,050,638

1.10% - 1.30%
7,045,435

1.40% - 1.60%
2,017,351

1.70% - 2.00%
312,013

>= 2.10%
1,332

Volatility Control Index
 
Current Asset Fee
 
At Maximum
$
—

0.75% - 1.75%
373,003

2.25% - 2.75%
211,814

3.00% - 3.50%
2,305,934

3.75% - 5.00%
2,524,462

If all caps and participation rates were reduced to minimum caps and participation rates and current asset fees were increased to their maximums, the cost of options would decrease by 0.77% based upon prices of options for the week ended July 1, 2020.

Page 13


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands)


Summary of Invested Assets
 
June 30, 2020
 
December 31, 2019
 
Carrying
Amount
 
Percent
 
Carrying
Amount
 
Percent
Fixed maturity securities:
 
 
 
 
 
 
 
United States Government full faith and credit
$
39,342

 
0.1
%
 
$
161,765

 
0.3
%
United States Government sponsored agencies
343,387

 
0.6
%
 
625,020

 
1.1
%
United States municipalities, states and territories
3,778,710

 
6.8
%
 
4,527,671

 
7.9
%
Foreign government obligations
207,509

 
0.4
%
 
205,096

 
0.3
%
Corporate securities
33,330,711

 
59.7
%
 
32,536,839

 
57.2
%
Residential mortgage backed securities
1,712,725

 
3.1
%
 
1,575,664

 
2.8
%
Commercial mortgage backed securities
5,393,062

 
9.6
%
 
5,786,279

 
10.2
%
Other asset backed securities
5,933,346

 
10.6
%
 
6,162,156

 
10.8
%
Total fixed maturity securities
50,738,792

 
90.9
%
 
51,580,490

 
90.6
%
Mortgage loans on real estate
3,958,233

 
7.1
%
 
3,448,793

 
6.1
%
Derivative instruments
672,958

 
1.2
%
 
1,355,989

 
2.4
%
Other investments
479,099

 
0.8
%
 
492,301

 
0.9
%
 
$
55,849,082

 
100.0
%
 
$
56,877,573

 
100.0
%

Page 14


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands, except per share data)


Credit Quality of Fixed Maturity Securities - June 30, 2020
NAIC Designation
 
Carrying
Amount
 
Percent
 
Rating Agency Rating
 
Carrying
Amount
 
Percent
1
 
$
28,327,288

 
55.8
%
 
Aaa/Aa/A
 
$
29,240,135

 
57.6
%
2
 
20,765,334

 
40.9
%
 
Baa
 
19,857,663

 
39.1
%
3
 
1,430,998

 
2.8
%
 
Ba
 
1,347,637

 
2.7
%
4
 
156,234

 
0.3
%
 
B
 
126,141

 
0.3
%
5
 
31,644

 
0.1
%
 
Caa
 
68,192

 
0.1
%
6
 
27,294

 
0.1
%
 
Ca and lower
 
99,024

 
0.2
%
 
 
$
50,738,792

 
100.0
%
 
 
 
$
50,738,792

 
100.0
%
Watch List Securities - June 30, 2020
General Description (a)
 
Amortized
Cost
 
Allowance for Credit Losses
 
Amortized Cost, Net of Allowance
 
Net Unrealized
Losses, Net of Allowance
 
Fair Value
Corporate securities - Public securities
 
$
59,078

 
$
(46,622
)
 
$
12,456

 
$
(1,718
)
 
$
10,738

Corporate securities - Private placement securities
 
359,141

 
(127
)
 
359,014

 
(25,933
)
 
333,081

Residential mortgage backed securities
 
35,860

 
(777
)
 
35,083

 
(458
)
 
34,625

Commercial mortgage backed securities
 
137,801

 
(2,660
)
 
135,141

 
(19,966
)
 
115,175

Other asset backed securities
 
83,892

 
—

 
83,892

 
(12,200
)
 
71,692

 
 
$
675,772

 
$
(50,186
)
 
$
625,586

 
$
(60,275
)
 
$
565,311

(a)
The watch list consists of all fixed maturity securities we have determined contain elevated credit risk, including those we have taken credit losses on.



Page 15


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands)


Fixed Maturity Securities by Sector
 
June 30, 2020
 
December 31, 2019
 
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair
Value
Available for sale:
 
 
 
 
 
 
 
United States Government full faith and credit and sponsored agencies
$
330,238

 
$
382,729

 
$
763,164

 
$
786,785

United States municipalities, states and territories
3,283,321

 
3,778,710

 
4,147,343

 
4,527,671

Foreign government obligations
187,021

 
207,509

 
186,993

 
205,096

Corporate securities:
 
 
 
 
 
 
 
Capital goods
2,489,801

 
2,824,749

 
2,550,750

 
2,794,986

Consumer discretionary
6,128,110

 
7,003,608

 
6,082,974

 
6,658,120

Energy
2,661,723

 
2,738,944

 
2,499,030

 
2,677,646

Financials
6,690,075

 
7,439,505

 
6,737,325

 
7,323,150

Government non-guaranteed
539,396

 
616,763

 
539,639

 
606,308

Industrials
276,430

 
316,225

 
311,269

 
336,537

Information technology
1,823,511

 
2,104,744

 
1,868,131

 
2,051,175

Materials
1,774,801

 
1,972,694

 
1,818,048

 
1,961,033

Other
438,725

 
498,284

 
439,171

 
469,344

Telecommunications
1,476,151

 
1,703,362

 
1,510,836

 
1,664,350

Transportation
1,567,784

 
1,647,677

 
1,486,540

 
1,603,997

Utilities
3,868,282

 
4,464,156

 
3,978,459

 
4,390,193

Residential mortgage backed securities:
 
 
 
 
 
 
 
Government agency
592,348

 
684,049

 
591,100

 
646,787

Prime
907,897

 
925,834

 
793,357

 
815,916

Alt-A
88,515

 
102,842

 
93,281

 
112,961

Commercial mortgage backed securities:
 
 
 
 
 
 
 
Government agency
402,537

 
458,597

 
414,626

 
437,420

Non-agency
5,121,544

 
4,934,465

 
5,176,541

 
5,348,859

Other asset backed securities:
 
 
 
 
 
 
 
Auto
381,835

 
382,965

 
403,860

 
411,371

Energy
7,400

 
9,228

 
7,495

 
8,603

Financials
4,441

 
4,149

 
4,967

 
5,493

Industrials
143,874

 
140,426

 
167,466

 
171,273

Collateralized loan obligations
4,798,760

 
4,369,527

 
4,787,402

 
4,612,694

Military housing
468,201

 
549,773

 
471,621

 
539,029

Other
498,322

 
477,278

 
407,558

 
413,693

 
$
46,951,043

 
$
50,738,792

 
$
48,238,946

 
$
51,580,490



Page 16


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020
Unaudited (Dollars in thousands)


Mortgage Loans on Real Estate
 
June 30, 2020
 
December 31, 2019
 
Principal
 
Percent
 
Principal
 
Percent
Geographic distribution: commercial mortgage loans
 
 
 
 
 
 
 
East
$
714,198

 
18.7
%
 
$
645,991

 
18.7
%
Middle Atlantic
287,864

 
7.5
%
 
284,597

 
8.2
%
Mountain
444,495

 
11.6
%
 
389,892

 
11.3
%
New England
25,066

 
0.7
%
 
9,152

 
0.3
%
Pacific
782,240

 
20.4
%
 
655,518

 
19.0
%
South Atlantic
820,260

 
21.4
%
 
751,199

 
21.7
%
West North Central
308,874

 
8.1
%
 
302,534

 
8.7
%
West South Central
445,975

 
11.6
%
 
420,031

 
12.1
%
 
$
3,828,972

 
100.0
%
 
$
3,458,914

 
100.0
%
 
 
 
 
 
 
 
 
Property type distribution: commercial mortgage loans
 
 
 
 
 
 
 
Office
$
259,888

 
6.8
%
 
$
250,287

 
7.3
%
Medical Office
27,372

 
0.7
%
 
29,990

 
0.9
%
Retail
1,225,212

 
32.0
%
 
1,225,670

 
35.4
%
Industrial/Warehouse
974,579

 
25.5
%
 
896,558

 
25.9
%
Apartment
971,536

 
25.4
%
 
858,679

 
24.8
%
Agricultural
177,333

 
4.6
%
 
51,303

 
1.5
%
Mixed use/Other
193,052

 
5.0
%
 
146,427

 
4.2
%
 
$
3,828,972

 
100.0
%
 
$
3,458,914

 
100.0
%
 
 
 
 
 
 
 
 
 
June 30, 2020
 
December 31, 2019
 
Commercial
 
Residential
 
Total
 
Total
Credit exposure - by payment activity
 
 
 
 
 
 
 
Performing
$
3,828,972

 
$
153,913

 
$
3,982,885

 
$
3,458,914

In workout
—

 
—

 
—

 
—

Delinquent
—

 
—

 
—

 
—

Collateral dependent
—

 
—

 
—

 
—

Principal outstanding
3,828,972

 
153,913

 
3,982,885

 
3,458,914

 
 
 
 
 
 
 
 
Unamortized discount
—

 
(3,078
)
 
(3,078
)
 
 
Deferred fees and costs, net
(1,858
)
 
373

 
(1,485
)
 
(942
)
Amortized cost
3,827,114

 
151,208

 
3,978,322

 
3,457,972

 
 
 
 
 
 
 
 
Valuation allowance
(18,439
)
 
(1,650
)
 
(20,089
)
 
(9,179
)
Carrying value
$
3,808,675

 
$
149,558

 
$
3,958,233

 
$
3,448,793



Page 17


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020


Shareholder Information
Corporate Offices:
American Equity Investment Life Holding Company
6000 Westown Parkway
West Des Moines, IA 50266
Inquiries:
Steven Schwartz, Vice President-Investor Relations
(515) 273-3763, sschwartz@american-equity.com
Common Stock and Dividend Information:
New York Stock Exchange symbol: “AEL”
 
High
 
Low
 
Close
 
Dividend Declared
2020
 
 
 
 
 
 
 
First Quarter
$34.16
 
$9.07
 
$18.80
 
$0.00
Second Quarter
$27.09
 
$14.76
 
$24.71
 
$0.00
 
 
 
 
 
 
 
 
2019
 
 
 
 
 
 
 
First Quarter
$33.57
 
$26.34
 
$27.02
 
$0.00
Second Quarter
$30.91
 
$25.84
 
$27.16
 
$0.00
Third Quarter
$27.80
 
$20.16
 
$24.20
 
$0.00
Fourth Quarter
$30.96
 
$21.75
 
$29.93
 
$0.30
 
 
 
 
 
 
 
 
2018
 
 
 
 
 
 
 
First Quarter
$35.79
 
$28.90
 
$29.36
 
$0.00
Second Quarter
$37.16
 
$27.06
 
$36.00
 
$0.00
Third Quarter
$38.57
 
$34.51
 
$35.36
 
$0.00
Fourth Quarter
$36.39
 
$25.27
 
$27.94
 
$0.28
Transfer Agent:
Computershare Trust Company, N.A.
P.O. Box 43010
Providence, RI 02940-0310
Phone: (877) 282-1169
Fax: (781) 575-2723
www.computershare.com
Annual Report and Other Information:
Shareholders may receive when available, without charge, a copy of American Equity’s Annual Report, SEC filings and/or press releases by calling Steven Schwartz, Vice President-Investor Relations, at (515) 273-3763 or by visiting our website at www.american-equity.com.



Page 18


AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
Financial Supplement - June 30, 2020


Research Analyst Coverage
Erik Bass
Autonomous Research US LP
(646) 561-6248
ebass@autonomous.com
Randy Binner
B. Riley FBR, Inc.
(703) 312-1890
rbinner@fbr.com
Daniel Bergman
Citi Research
(212) 816-2132
daniel.bergman@citi.com
Thomas Gallagher
Evercore ISI
(212) 446-9439
thomas.gallagher@evercoreisi.com
Pablo Singzon II
JP Morgan
(212) 622-2295
pablo.s.singzon@jpmorgan.com

 

Ryan Krueger
Keefe, Bruyette & Woods
(860) 722-5930
rkrueger@kbw.com
C. Gregory Peters
Raymond James & Associates, Inc.
(727) 567-1534
greg.peters@raymondjames.com
Mark A. Dwelle
RBC Capital Markets, LLC
(804) 782-4008
mark.dwelle@rbccm.com
John Barnidge
Piper Sandler & Co.
(312) 281-3412
John.Barnidge@psc.com
Mark Hughes
SunTrust Robinson Humphrey
(615) 748-4422
mark.hughes@suntrust.com



Page 19

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