Company: APO
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0001858681-25-000049
Chunk: 5

Company: Apollo Global Management, Inc.
Filing Date: 2025-05-07
Form: 10-Q
Item: Item 2
Chunk 5
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23% as of March 31, 2025, compared to 4.58% as of December 31, 2024. Short-term rates decreased during the first quarter of 2025, with the 3-month secured overnight financing rate at 4.29% as of March 31, 2025 compared to 4.31% as of December 31, 2024.

With respect to Retirement Services, Athene’s investment portfolio consists predominantly of fixed maturity investments. If prevailing interest rates were to rise, we believe the yield on Athene’s new investment purchases may also rise and its investment income from floating rate investments would increase, while the value of its existing investments may decline. If prevailing interest rates were to decline significantly, the yield on Athene’s new investment purchases may decline and its investment income from floating rate investments would decrease, while the value of its existing investments may increase. 

Athene addresses interest rate risk through managing the duration of the liabilities it sources with assets it acquires through asset liability management (“ALM”) modeling. As part of its investment strategy, Athene purchases floating rate investments, which are expected to perform well in a rising interest rate environment and are expected to underperform in a declining rate environment. Athene manages its interest rate risk in a declining rate environment through hedging activity or the issuance of additional floating rate liabilities to lower its overall net floating rate position. As of March 31, 2025, Athene’s net invested asset portfolio included $52.9 billion of floating rate investments, or 20% of its net invested assets, and its net reserve liabilities included $35.7 billion of floating rate liabilities at notional, or 13% of its net invested assets, resulting in $17.2 billion of net floating rate assets, or 7% of its net invested assets.

If prevailing interest rates were to rise, we believe Athene’s products would be more attractive to consumers and its sales would likely increase. If prevailing interest rates were to decline, it is likely that Athene’s products would be less attractive to consumers and its sales would likely decrease. In periods of prolonged low interest rates, the net investment spread may be 

94

negatively impacted by reduced investment income to the extent that Athene is unable to adequately reduce policyholder crediting rates due to policyholder guarantees in the form of minimum crediting rates or otherwise due to market conditions. A significant majority of Athene’s deferred annuity products have crediting rates that it may reset