Company: AFGC
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001042046-25-000024
Chunk: 90

Company: AMERICAN FINANCIAL GROUP INC
Filing Date: 2025-08-07
Form: 10-Q
Item: Part I, Item 8
Chunk 90
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 investments is inversely correlated to changes in interest rates. The following table demonstrates the sensitivity of such fair values to reasonably likely changes in interest rates by illustrating the estimated effect on AFG’s fixed maturity portfolio that an immediate increase of 100 basis points in the interest rate yield curve would have had at June 30, 2025 (dollars in millions). Effects of increases or decreases from the 100 basis points illustrated would be approximately proportional.

Fair value of fixed maturity portfolio$10,571 Percentage impact on fair value of 100 bps increase in interest rates(3.0%)Pretax impact on fair value of fixed maturity portfolio$(317)

Approximately 95% of the fixed maturities held by AFG at June 30, 2025, were rated “investment grade” (credit rating of AAA to BBB) by nationally recognized rating agencies, 2% were rated “non-investment grade” and 3% were not rated. Investment grade securities generally bear lower yields and lower degrees of risk than those that are unrated and non-investment grade. Management believes that the high-quality investment portfolio should generate a stable and predictable investment return.

AFG has approximately $75 million of direct exposure to office commercial real estate through property ownership, mortgages or equity method investments. AFG’s fixed maturity portfolio includes securities (the majority of which are AAA-rated) with a carrying value of approximately $350 million that have minimal exposure to office commercial real estate.

Summarized information for the unrealized gains and losses recorded in AFG’s Balance Sheet at June 30, 2025, is shown in the following table (dollars in millions). There were $446 million of available for sale fixed maturity securities with no unrealized gains or losses at June 30, 2025.

SecuritiesWithUnrealizedGainsSecuritiesWithUnrealizedLossesAvailable for Sale Fixed MaturitiesFair value of securities$5,424 $4,619 Amortized cost of securities, net of allowance for expected credit losses$5,282 $4,889 Gross unrealized gain (loss)$142 $(270)Fair value as % of amortized cost103%94%Number of security positions942 1,084 Number individually exceeding $2 million gain or loss2 33 Concentration of gains (losses) by type or industry (exceeding 5% of unrealized):Residential mortgage-backed securities$32 $(128