Reinsurance Group Of America, Incorporated · NYSE:RGA
Reinsurance Group Of America — Q3 2021 Earnings Presentation
24 slides from Reinsurance Group Of America's earnings presentation, Nov 4, 2021
Slide 1: 3Q21 Earnings Presentation
The security of experience. The power of innovation. 3Q21 Earnings Presentation Reinsurance Group of America, Incorporated November 4, 2021
Slide 2: Safe Harbor
Safe Harbor This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 including, among others, statements relating to projections of the future operations, strategies, earnings, revenues, income or loss, ratios, financial perform
Slide 3: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures RGA uses a non-GAAP financial measure called adjusted operating income as a basis for analyzing financial results. This measure also serves as a basis for establishing target levels and awards under RGA’s management incentive programs. Management believes that adju
Slide 4: Key Messages
Key Messages Strong underlying results, elevated COVID-19 claim costs Adjusted operating loss of $1.111 per diluted share included $5.592 per diluted share of COVID- 19 impacts Trailing 12 month adjusted operating ROE of 2.1%1 included 9.8%2 of COVID-19 impacts Strong GFS earnings contribution
Slide 5: Third Quarter Results
Third Quarter Results Pre-tax Adjusted Operating Adjusted Operating EPS1 Trailing 12 Month Adjusted Income1 3Q21 estimated COVID-19 Operating ROE1 3Q21 results include $500 million of impacts2 of $5.593 per diluted Estimated COVID-19 impacts2 of estimated COVID-19 impacts2, $1.0 share, $11.403
Slide 6: Third Quarter Results by Segment
Third Quarter Results by Segment 3Q21 3Q20 Pre-tax Adjusted Operating Income U.S. and Latin America: Traditional results reflect 3Q21 COVID-19 3Q20 COVID-19 (Loss)1 COVID-19 claim costs, excess individual mortality Impact2 Impact2 claims believed to be directly or indirectly COVID-19- related, and
Slide 7: Premiums By Segment
Premiums By Segment % Reported premium growth of 9.5% Premiums1 3Q21 3Q20 Change U.S. and Latin America premium growth U.S. and Latin America Traditional $1,550 $1,420 9.2% includes a one-time restructure of an existing treaty U.S. and Latin America Asset-Intensive $14 $13 7.7% Canada premiums
Slide 8: Investments Summary
Investments Summary Investment performance a strength across income and yield Investment yield and new money rates for non-spread portfolio supported by broad capabilities including private assets – Variable investment income driven by limited partnership portfolio performance as well as real es
Slide 9: Non-Spread Investment Results
Non-Spread Investment Results Investment Yield1 New Money Rates2 Steady income supported by portfolio Majority of purchases in public investment allocation, including strong private asset grade assets production over time New money rates rose in part due to strong Variable investment income
Slide 10: Capital and Liquidity
Capital and Liquidity Capital Leverage Ratios Ample Liquidity Strong balance sheet with a Leverage ratios within our targeted Holding a high level of liquidity stable capital mix ranges through Q3, continuing gradual Excess capital position of $1.0 Retired 2021 senior debt maturity in redu
Slide 11: Balanced Capital Management
Balanced Capital Management 3Q21 Highlights 2021 YTD Capital Deployment Deployed $140 million into in-force blocks Strong capital deployment year-to-date consistent with pre-pandemic levels Resumed share buybacks, purchasing $46 Success over time in deploying capital into million of shares i
Slide 12: U.S. General Population Mortality
U.S. General Population Mortality Elevated Q3 COVID-19 and Non-COVID-19 excess population deaths 250,000 Excess Population Deaths1 45.0% Proportion of COVID-19 Population 40.0% Deaths Below Age 652 200,000 35.0% 30.0% 150,000 25.0% 20.0% 100,000 15.0% 50,000 10.0% 5.0% - 0.0% 2Q20 3Q20 4Q20 1Q21 2Q2
Slide 13: U.S. Individual Mortality Claims Experience
U.S. Individual Mortality Claims Experience Higher Q3 mortality driven by increased general population deaths COVID-19 claim costs estimated at $235 million Slightly above the high end of our expected range based on general population deaths due to higher mortality in attained ages below 65 and
Slide 14: Other COVID-19 Claims Experience
Other COVID-19 Claims Experience $161 million of estimated COVID-19 claim costs in India – Reflects more adverse impact of the Q2 2021 Delta wave – Higher general population deaths, a shift in deaths to younger ages, and larger average claim sizes $64 million of estimated COVID-19 claim costs in
Slide 15: Q4 COVID-19 Mortality Expectations
Q4 COVID-19 Mortality Expectations No change to the previously provided U.S., U.K. and Canada estimated COVID-19 claim costs ranges; continuing to monitor and incorporate updated data as it becomes available – U.S. COVID-19 general population deaths continue in Q4, trending down from September pea
Slide 16: Long-term Business, Long-term Success
Long-term Business, Long-term Success Book value per share (ex-AOCI)1 total return growth2 15-Year 10.2% CAGR3 Consistent book value growth 10-Year 10.6% CAGR3 over time, in a range of environments 5-Year 10.9% CAGR3 3-Year 6.5% CAGR3 Demonstrated value from diversification of earnings $132.33 $
Slide 17: Appendix
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Slide 18: Diversified, Resilient and High-Quality Portfolio
Diversified, Resilient and High-Quality Portfolio Average portfolio credit rating: A 93.4% investment grade $80.6B CML average LTV 57.6% CLO book value $2.1 billion1, AA average credit quality (88.1% A and above) Diversification and strong underwriting are core to our investment strategy
Slide 19: Commercial Mortgage Loans (CML)
Commercial Mortgage Loans (CML) Team has managed through multiple real estate cycles; robust infrastructure to protect value in times of stress Portfolio underwriting metrics provide significant downside $6.4B support ‒ Loan-to-value (<58%), significant borrower equity ahead of our investment ‒
Slide 20: Pre-Tax Income (Loss) Reconciliation
Pre-Tax Income (Loss) Reconciliation Investment impairments have slowed due to various 3Q21 3Q20 improvements in the financial markets; we decreased Pre-tax income (loss)1 $ (34) 285 valuation allowance on the commercial mortgage loan portfolio to reflect the updated economic outlook Investment-re
Slide 21: Reconciliations of Non-GAAP Measures
Reconciliations of Non-GAAP Measures Reconciliation of GAAP pre-tax income to pre-tax adjusted operating income In millions 3Q20 3Q21 U.S. & Latin America Traditional GAAP pre-tax income (loss) $ 14 $ (126) Change in MV of embedded derivatives 1 8 5 Pre-tax adjusted operating income $ 22 $ (121) U.S
Slide 22: Reconciliations of Non-GAAP Measures
Reconciliations of Non-GAAP Measures Reconciliation of GAAP pre-tax income to pre-tax adjusted operating income In millions 3Q20 3Q21 YTD 2020 YTD 2021 Asia Pacific Traditional GAAP pre-tax income $ 78 $ (96) Pre-tax adjusted operating income $ 78 $ (96) Asia Pacific Financial Solutions GAAP pre-tax
Slide 23: Reconciliations of Non-GAAP Measures
Reconciliations of Non-GAAP Measures Reconciliation of GAAP stockholders' equity to stockholders' equity excluding AOCI In millions 2017 2018 2019 2020 3Q20 3Q21 GAAP stockholders' equity $ 9,569.5 $ 8,450.6 $ 11,601.7 $ 14,352.0 $ 13,213 $ 12,885 Less: Unrealized appreciation of securities 2,200.7
Slide 24: ©2021 RGA. All rights reserved.
©2021 RGA. All rights reserved. No part of this publication may be reproduced in any form without the prior permission of RGA. The information in this publication is for the exclusive, internal use of the recipient and may not be relied upon by any other party other than the recipient and its affili
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