Company: APO
Filing Date: 2025-02-24
Form Type: 10-K
Source: 0001858681-25-000034
Chunk: 44

Company: Apollo Global Management, Inc.
Filing Date: 2025-02-24
Form: 10-K
Item: Item 7
Chunk 44
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 net investment income, partially offset by an increase in income attributable to the ACRA non-controlling interests following the sale of a 50% interest in ACRA 2 to ADIP II effective July 1, 2023 and the subsequent increases in the ADIP II ownership of ACRA 2 to 60% effective December 31, 2023 and 63% effective October 1, 2024. The increase in alternative net investment income compared to 2023 was primarily driven by more favorable performance within retirement services and strategic origination platforms, as well as credit, partially offset by less favorable performance within equity. The increase in income from retirement services platforms was primarily related to underperformance from FWD Group Holdings Limited (“FWD”) and a decrease in the share price of Challenger Limited (“Challenger”) in 2023, partially offset by increased expenses and lower growth impacting the valuation of Athora in 2024. The increase in income from strategic origination platforms was mainly attributable to unfavorable performance from Aqua Finance in 2023 related to macroeconomic headwinds for consumer loan origination, favorable performance from Foundation Home Loans driven by increased origination volumes in 2024 and strong growth within other strategic origination platforms related to the funding of investments in 2024, partially offset by outsized performance from MidCap Financial in 2023.

91

Strategic capital management fees increased $33 million due to additional fees received from ADIP II as a result of the sale of a 50% interest in ACRA 2 to ADIP II effective July 1, 2023 and the subsequent increases in the ADIP II ownership of ACRA 2 to 60% effective December 31, 2023 and 63% effective October 1, 2024, as well as new business ceded to ACRA 2 in 2024.

Cost of funds increased $2.1 billion, primarily driven by growth in and higher rates on new deferred annuity issuances, growth in and higher rates on new institutional business, including the additional costs of swapping to or issuing funding agreements as floating rate to mitigate SRE sensitivity to floating rate assets, an increase in business mix to institutional business at higher crediting rates and the $114 million operating gain on the settlement of the VIAC recapture agreement in 2023. These impacts were partially offset by an increase in costs attributable to the ACRA non-controlling interests following the sale of a 50% interest in ACRA 2 to