Ameriprise Certificate Company (“ACC”) was incorporated on October 28, 1977 under the laws of Delaware. Ameriprise Financial, Inc. (“Ameriprise Financial”, collectively with its subsidiaries and affiliates, “we”, “us” and “our”), a Delaware corporation, owns 100% of the outstanding voting securities of ACC. Ameriprise Financial and its predecessor companies have nearly a 125 year of130-year history of providing solutions to help clients confidently achieve their financial objectives.

ACC is registered as an investment company under the Investment Company Act of 1940, as amended (the “1940 Act”) and is in the business of issuing face-amount investment certificates. Face-amount certificates issued by ACC entitle the certificate owner to receive at maturity a stated amount of money and interest or credits declared from time to time by ACC, at its discretion. ACC’s certificates are distributed and sold solely by Ameriprise Financial Services, LLC (“AFS”), an affiliate of ACC.ACC and its network of more than 10,000 advisors. AFS is registered as a broker-dealer in all 50 states, the District of Columbia and Puerto Rico.

To ACC’s knowledge, ACC is the largest issuer of face-amount certificates in the United States. However, ACC’s certificate products compete with many other banking and investment products offered by banks, savings and loan associations, asset managers, broker-dealers and others, which may be viewed by potential clients as offering a comparable or superior combination of safety and return on investment. In particular, some of ACC’s products are designed to be competitive with the types of investments offered by banks and thrifts. Since ACC’s face-amount certificates are securities, their offer and sale are subject to regulation under federal and state securities laws. ACC’s certificates are backed by ACC’s qualified assets on deposit and are not insured by any governmental agency or other entity.

ACC’s future profitability is dependent upon changes in the economic, credit and equity environments, as well as the competitive environment.

As of the date of this report, ACC offered the following four differentthree types of certificate products to the public:

Within the specified maturity periods, most certificates have interest crediting rate terms ranging from three to forty-eight months. Interest crediting rates are subject to change and certificate product owners can surrender their certificates without penalty at the end of a term. Currently offered ACC certificates (listed above), as well as certain certificates previously issued by ACC (not listed above), contain renewal features which enable certificate owners to renew their certificate term until certificate maturity. Accordingly, certificate products that are currently outstanding in their renewal periods or are exercised for renewal in the future are, and continue to be, liabilities of ACC until their redemption or maturity, whether or not such certificates are available for new sales. ACC guarantees the return of principal, as well as interest once it has been credited, less any penalties that apply, for each of the certificates offered.

ACC’s certificates are offered solely by AFS and sold pursuant to a distribution agreement which is subject to annual review and approval by ACC’s Board of Directors, including a majority of the directors who are not “interested persons” of AFS or ACC as that term is defined in the 1940 Act. The distribution agreement provides for the payment of distribution fees to AFS for services provided. The distribution agreement with AFS can be terminated by either party on sixty days’ written notice.

ACC has retained Columbia Management Investment Advisers, LLC (“CMIA”), a wholly owned subsidiary of Ameriprise Financial, to manage ACC’s investment portfolio under an investment management agreement, which is subject to annual review and approval by ACC’s Board of Directors, including a majority of the directors who are not “interested persons” of AFS, CMIA or ACC. This investment management agreement with CMIA can be terminated by either party on sixty days’ written notice.

ACC is required to maintain cash and “qualified assets” meeting the standards of Section 28(b) of the 1940 Act, as modified by an exemptive order of the Securities and Exchange Commission (“SEC”). The amortized cost of such investments must be at least equal to ACC’s net liabilities on all outstanding face-amount certificates plus $250,000. ACC’s qualified assets consist of cash and cash equivalents, residential and commercial mortgage backed securities, asset backed securities, syndicated loans, and commercial mortgage loans, U.S. government and government agency securities,obligations, state and municipal bonds,obligations, corporate bonds, equitydebt securities, equity index options and other securities meeting specified standards. So long as ACC wishes to rely on the SEC order, as a condition to the order, ACC has agreed to maintain an amount of unappropriated retained earnings and capital equal to at least 5% of certificate reserves (less outstanding certificate loans). To the extent that payment of a dividend would decrease the capital ratio below the required 5%, payment of a dividend would be restricted. In determining

ACC has also entered into a written understanding with the Minnesota Department of Commerce that ACC will maintain capital equal to at least 5% of the assets of ACC (less outstanding certificate loans). To the extent that payment of a dividend would decrease this ratio below the required 5%, payment of a dividend would be restricted. When computing its capital for these purposes, ACC values its assets on the basis of statutory accounting for insurance companies rather than U.S. generally accepted accounting principles (“GAAP”). ACC is subject to examination and supervision by the Minnesota Department of Commerce (Banking Division) and the SEC.

Following conversion of ACC’s affiliate Ameriprise National Trust Bank into a federal savings bank (“Ameriprise Bank”), Ameriprise Financial continued to be subject to ongoing supervision by the Board of Governors for the Federal Reserve System (“FRB”). FRB regulation and supervisory oversight of Ameriprise Financial includes examinations, regular financial reporting, and prudential standards, such as capital, liquidity, risk management and parameters for business conduct and internal governance. In order to maintain Ameriprise Financial’s permission under applicable bank holding company laws and regulations to engage in business activities other than banking or activities closely related to banking, each of Ameriprise Financial and Ameriprise Bank, as Ameriprise’sAmeriprise Financial’s sole insured depository institution subsidiary, must remain “well-capitalized” and “well-managed” under applicable federal banking regulations, and Ameriprise Bank must receive at least a “satisfactory” rating in its most recent examination under the Community Reinvestment Act. Failure to meet one or more of certain requirements and regulations would mean, depending on the

requirements not met and any agreement then reached with the FRB, that until cured Ameriprise Financial (and therefore ACC) could not undertake new activities, continue certain activities, or make certain acquisitions. As a subsidiary of Ameriprise Financial, ACC is (absent exclusion or exemption) required to comply with investment limitations on its portfolio and other limitations under applicable banking laws, including what is commonly referred to as the Volcker Rule.

ACC’s operations and financial results are subject to various risks and uncertainties, including those described below, that could have a material adverse effect on ACC’s business, financial condition or results of operations. We believe that the following information identifies the material factors affecting ACC based on the information we currently know. However, the risks and uncertainties ACC faces are not limited to those described below. Additional risks and uncertainties which are not presently known or which are currently believed to be immaterial may also adversely affect ACC’s business.

ACC’s financial condition and results of operations are affected by the “spread,” or the difference between the returns ACC earns on the investments that support its product obligations and the amounts that ACC must pay certificate holders.

During periodsIf there is a return to a period of falling interest rates or stagnancy ofprolonged low interest rates, ACC’s spread may be reduced or could become negative primarily because ACC may adjust the interest rates it credits on most of the products downward only at limited, pre-established intervals. Interest rate fluctuations also could have an adverse effect on the results of ACC’s investment portfolio. During periods of declining market interest rates or stagnancy of low interest rates, the interest ACC receives on variable interest rate investments decreases. In addition, during those periods, ACC is forced to reinvest the cash it receives as interest or return of principal on its investments in lower-yielding high-grade instruments or in lower-credit instruments to maintain comparable returns. Issuers of certain callable fixed income securities also may decide to prepay their obligations in order to borrow at lower market rates which increase the risk that ACC may have to reinvest the cash proceeds of these securities in lower-yielding or lower-credit instruments. Offsetting some of these risks is the fact that a significant portion of certificate balances do not have a minimum guaranteed interest crediting rate.

ACC’s business is regulatedoperates in an intensely competitive industry segment. ACC competes based on a number of factors including name recognition, service, interest rates, product features and perceived financial strength. ACC’s competitors include broker-dealers, banks, asset managers and other financial institutions. ACC’s business faces competitors that have greater market share, offer a broader range of products, greater investments in technology and analytics or have greater financial resources. Furthermore, ACC’s competitors may be better able to address trends, structural changes, or movement of assets resulting from industry changes or in legislation or regulationresponse to the uncertain regulatory environment in the U.S. and around the world.

ACC operates in a regulated industry. As a registered investment company, ACC must observe certain governance, disclosure, record-keeping, marketing, privacy, data protection and other operating requirements. Various regulatory and governmental bodies haveis dependent on the authority to review ACC’s products and business practices and to bring regulatory or other legal actions against ACC if, in their view, ACC’s practices are improper. Any enforcement actions, investigations or other proceedings brought against ACC or its directors or employeesfinancial advisors of AFS for all of the sales of its affiliates by its regulators may result in fines, injunctions or other disciplinary actions that could harm ACC’s reputation or impact ACC’s results of operations. Further, any future legislation or changes to the laws and regulations applicable to ACC’s business such as possible changes brought about by any U.S. Department of Labor applicable regulation as well as state and other fiduciary rules, the SEC best interest standards, or similar standards such as the Certified Financial Planner Board standards pertaining to the fiduciary status of investment advice providers to retirement investors (primarily account holders in 401(k) plans and IRAs and other types of ERISA clients) and related issues. Each of these has a potential impact regarding how ERISA investment advice fiduciaries and others can provide products manufactured by affiliates to, or engage in certain principal transactions with, retirement investors, including incremental requirements, costs and risks that may be imposed on ACC as a resultcertificate products. A significant number of such changes, may affect the operationsfinancial advisors operate as independent contractors under a franchise agreement with AFS. The market for financial advisors is highly competitive, and financial condition of ACC. In addition, after the conversion of Ameriprise Bank into a federal savings bank, Ameriprise Financial became subjectthere can be no assurance that AFS will be successful in its efforts to ongoing supervision by the FRB. As a subsidiary of Ameriprise Financial, ACC is (absent exclusion or exemption) required to comply with certain limits onmaintain its activity, including investment

The determination of the amount of allowances varyvaries by investment type and is based upon ACC’s periodic evaluation and assessment of inherent and known risks associated with the respective asset class.

Management uses its best judgment in evaluating the cause of the decline in the estimated fair value of the security and in assessing the prospects for recovery. Inherent in management’s evaluation of the security are assumptions and estimates about the operations of the issuer and its future earnings potential. The determination of the amount of allowances on loans is based upon the asset’s expected life, considering past events, current conditions and reasonable and supportable economic forecasts. Such evaluations and assessments are revised as conditions change and new information becomes available. Historical trends may not be indicative of future impairments or allowances.

Investment certificates may be purchased either with a lump-sum payment or by installment payments. Certificate product owners are entitled to receive, at maturity, a definite sum of money. Payments from certificate owners are credited to investment certificate reserves. Investment certificate reserves accumulate interest at specified percentage rates as declared by ACC. Reserves are also maintained for advance payments made by certificate owners, accrued interest thereon, and for additional credits in excess of minimum guaranteed rates and accrued interest thereon. On certificates allowing for the deduction of a surrender charge, the cash surrender values may be less than accumulated investment certificate reserves prior to maturity dates. Cash surrender values on certificates allowing for no surrender charge are equal to certificate reserves. The payment distribution, reserve accumulation rates, cash surrender values, reserve values and other matters are governed by the 1940 Act.

Certain certificates offer a return based on the relative change in a stock market index. The certificates with an equity-based return contain embedded derivatives, which are carried at fair value within investment certificate reserves on the Consolidated Balance

ACC monitors its reserve levels continually. If ACC concluded its reserves were insufficient to cover actual or expected redemptions or maturities, ACC would be required to increase its reserves and incur income statement charges for the period in which it makes the determination. Such a determination could adversely affect ACC’s financial condition and results of operations.

The ability of ACC to market and sell its products is highly dependent upon external perceptions of ACC’s and its affiliates’ level of service, business practices and financial condition. Damage to the reputation of ACC or its affiliates could cause significant harm to the business and prospects of ACC. Reputational damage may arise from numerous sources, including litigation or regulatory actions, failing to deliver minimum standards of service and quality, compliance failures, any perceived or actual weaknesses in ACC’s financial strength or liquidity, clients’ or potential clients’ perceived failure of how ACC addresses certain political, environmental, social or environmentalgovernance topics, technological breakdowns, cybersecurity attacks, or other security breaches (including attempted breaches, breaches impacting ACC’s vendors or their subcontractors or inadvertent breaches)disclosures) resulting in system unavailability, improper disclosure or loss of data integrity relating to client or employee personal information, unethical or improper behavior and the misconduct or error of employees of its affiliates, AFS’s advisors and counterparties. Additionally, a failure to develop new products and services, or successfully manage associated operational risks, could harm ACC’s reputation and potentially expose ACC to additional costs, or negative public relations or social media campaigns. Any negative incidents can quickly erode trust and confidence, particularly if they result in adverse mainstream and social media publicity, governmental audits or investigations or litigation. Adverse developments with respect to the financial industry may also, by association, negatively impact ACC’s reputation or result in greater regulatory or legislative scrutiny or litigation against ACC.

Misconduct by employees of ACC’s affiliates may be difficult to detect and deter and may damage ACC’s reputation. This can include improper use of their authorized access to sensitive information. Misconduct or errors by employees of ACC’s affiliates, AFS’s advisors or counterparties could result in violations of law, regulatory sanctions and/or serious reputational or financial harm. Misconduct or errorsmistakes can occur in ACC’s business. ACC and its affiliates cannot always deterprevent misconduct of employees of ACC’s affiliates, and the precautions its affiliates take to prevent and detect this activity may not be effective in all cases. Preventing and detecting misconduct among ACC’s affiliates franchisee advisors presents additional challenges in that they control their own technology environment on a day-to-day basis and could have an adverse effect on ACC’s business. ACC’s reputation depends on its continued identification of and mitigation against conflicts of interest. ACC has procedures and controls that are designed to identify, address and appropriately disclose perceived conflicts of interest, though ACC’s reputation could be damaged if ACC fails, or appears to fail, to address conflicts of interest appropriately.

The business of ACC and its affiliates is reliant upon internal and third-party controlled, developed and operated software (which includes open source software), technology systems and networks to process, transmit and store information, including current, potential and former clients’, advisors’ personal information, as well as proprietary information, and to conduct many business activities and transactions. Maintaining the security and integrity of the software, information and these systems and networks, and appropriately responding to any cybersecurity and privacy incidents (including attempts), is critical to the success of ACC’s business operations, including investment management, transfer agent, custodyACC’s reputation, to the retention of AFS’s advisors and distribution services,clients, and to the protection of ACC’s proprietary information and clients’ personal information.

ACC and its affiliates rely on the third parties with whom it does business to identify and remediate software and other vulnerabilities before they can be exploited by bad actors, but they cannot always do so. For example, zero-day vulnerabilities in software and other technology solutions are performedimmediately exploitable by affiliatedbad actors as occasionally happens with certain of ACC’s affiliates’ vendors in the industry. ACC and its affiliates routinely face attacks and seek to address evolving threats of which we become aware. ACC and its affiliates have been able to identify, protect, detect, respond to and recover from these attacks to date without a material loss of client financial assets or information through the use of ongoing internal and external threat monitoring and by making continual adjustments to ACC’s security and incident response capabilities.

Employees of ACC’s affiliates, as well as service providers and clients, have also been threatened by, among others, phishing, vishing, and spear phishing scams, social engineering attacks (such as direct voice contact and any technology or communication mechanism to contact a person), account takeovers, introductions of malware, attempts at electronic break-ins, and the submission of fraudulent payment requests. The number of threats and events has increased substantially every year, which is expected to continue, particularly as the use of artificial intelligence makes these attempts look more legitimate. Attempted or successful breaches or interference by third parties or by insiders that may occur in some cases their subcontractors, pursuant to formal contracts. The failure of a service provider to fulfill its responsibilitiesthe future could have ana material adverse effectimpact on ACC’s business, reputation, financial condition andor results of operations that could be material.operations.

Changes inOn a corporate taxbasis, various laws and regulations, and in some cases contractual obligations, require ACC’s affiliates to establish and maintain corporate policies and technical and operational measures designed to protect sensitive client, contractor and vendor information, and to respond to cybersecurity incidents in certain ways and timeframes. ACC’s affiliates have established policies and implemented such technical and operational measures and have in place policies that require AFS’s service providers and franchisee advisors, each of which control locally their own technology operations, to do the same. The increase in hybrid working among ACC’s affiliates’ employees adds complexity to monitoring and processing procedures. Changes in ACC’s business or technological advancements may also require corresponding changes in ACC’s systems, networks and data security and response measures. While accessing ACC and its affiliates products and services, ACC’s customers may use computers and other devices that sit outside of ACC and its affiliates security control environment. In addition, the interpretationever-increasing reliance on technology systems and networks and the occurrence and potential adverse impact of attacks on such lawssystems and regulations,networks (including in recent well-publicized security breaches at other companies), both generally and in the financial services industry, have enhanced government and regulatory scrutiny of the measures taken by companies to protect against cybersecurity threats and report incidents they suffer. As these threats, and government and regulatory oversight of associated risks, continue to evolve, ACC may be required to expend additional resources (both direct financial resources and indirect costs like people) to enhance or expand upon the technical and operational security and response measures ACC and its affiliates currently maintain. These regulator-driven changes may adversely impact the client experience by, for example, requiring multiple means of verifying the identity of a client before they can interact with ACC.

Despite the measures ACC has taken and may in the future take to address and mitigate cybersecurity, privacy and technology risks, ACC cannot be certain that ACC and its affiliates systems and networks, or those used by its vendors, will not be subject to successful attacks, breaches or interference. Nor can ACC guarantee that AFS franchise advisors will comply with ACC and its affiliates policies and procedures in this regard, or that clients will engage in safe and secure online practices. Furthermore, human error occurs from time to time and such mistakes can lead to the inadvertent disclosure of sensitive information. ACC and its affiliates have a vendor management process, but at times, ACC and its affiliates’ software or service providers could push through updates that are not fully disclosed to us (or tested by them) and that could alter the control posture of their products. Any such event may result in operational disruptions, as well as adverse determinations regardingunauthorized access to or the applicationdisclosure or loss of, such lawsACC’s proprietary information or ACC’s affiliates’ client, employee, vendor or advisor personal information, which in turn may result in legal claims, regulatory scrutiny and regulations, could adversely affectliability, reputational damage, the incurrence of costs to respond to, eliminate, or mitigate further exposure, the loss of clients or AFS advisors, or other damage to ACC’s earnings.

Operating errors and system or network interruptions could delay and disrupt ACC’s operations. Interruptions could be caused by mistake, malfeasance or other operational failures by service provider staff or ACC’s affiliates’ employee error or malfeasance, interference by third parties, including hackers, ACC’s implementation of new technology, maintenance of existing technology or natural disasters, each of which these businesses are based receive favorable treatment under current U.S. federal incomemay impact ACC’s ability to run its systems or estate tax law. Changes in U.S. federal income or estate tax law could reduceencounter varying downtime. Though ACC plans for

resiliency in its systems and test these capabilities, it could face additional downtime or eliminate the tax advantagesdata loss if its plans do not work as expected during a real event. ACC’s financial, accounting, human resources, data processing or other operating systems and facilities may fail to operate or report data properly, experience connectivity disruptions or otherwise become disabled as a result of certain of Ameriprise Financial’sevents that are wholly or partially beyond ACC’s control, adversely affecting ACC’s ability to process transactions or provide products and thus makeservices to clients (some of which have regulatory required response times).

ACC and its affiliates rely on third-party service providers and vendors for certain communications, technology and business functions and other services, and ACC and its affiliates face the risk of their operational failure (including, without limitation, loss of staff due to widespread illness, failure caused by an inaccuracy, untimeliness or other deficiency in data reporting), technical or security failures, termination or capacity constraints of any of the third-party service providers that ACC or its affiliates use to facilitate or are component providers to ACC’s activities. Any such failure, termination or constraint or flawed execution or response could adversely impact ACC’s ability to effect transactions, service clients, manage exposure to risk, or otherwise achieve desired outcomes.

Management of operational, legal and regulatory risks requires, among other things, policies and procedures to record properly and verify a large number of transactions and events, and these policies and procedures may not be fully effective in mitigating ACC’s products less attractiverisk exposure in all market environments or against all types of risk, including those associated with ACC’s or its affiliates’ key vendors. Insurance and other traditional risk-shifting tools may be held by or available to clientsACC in order to manage certain exposures, but they are subject to terms such as deductibles, coinsurance, limits and policy exclusions, as well as risk of counterparty denial of coverage, default or cause a change in client demand and activity.insolvency.

The occurrence of natural disasters and catastrophes, including earthquakes, hurricanes, floods, tornadoes, fires, blackouts, severe winter weather, explosions, pandemic disease and global health emergencies (such as COVID-19) and man-made disasters, including acts of terrorism, riots, civil unrest including large-scale protests, insurrections and military actions, could adversely affect the results of operations or financial condition of ACC. Such disasters and catastrophes may impact ACC directly by damaging its facilities, preventing service providers or employees of its affiliates from performing their roles or otherwise disturbing its ordinary business operations. These impacts could be particularly severe to the extent they affect access to physical facilities or the physical well-being of large numbers of employees of ACC’s affiliates, ACC’s computer-based data processing, transmission, storage and retrieval systems and destroy or release valuable data. Such disasters and catastrophes may also impact ACC indirectly by changing the condition and behaviors of its customers, business counterparties and regulators, as well as by causing declines or volatility in the economic and financial markets, which could in turn have an adverse effect on ACC’s investment portfolio.

ACC cannot predict the impact that changing climate conditions may have on the frequency and severity of natural disasters or on overall economic stability and sustainability. As such, ACC cannot be sure that its actions to identify and mitigate the risks associated with such disasters and catastrophes will be effective.

ACC operates in a regulated industry. As a registered investment company, ACC must observe certain governance, disclosure, record-keeping, marketing, privacy, data protection and other operating requirements. Various regulatory and governmental bodies have the authority to review ACC’s products and business practices and to bring regulatory or other legal actions against all cybersecurity-related losses. Furthermore, ACC if, in their view, ACC’s practices are improper. Any enforcement actions, investigations or other proceedings brought against ACC or its directors or employees of its affiliates by its regulators may be subject to indemnification costs and liability to third parties if ACC breachesresult in fines, injunctions or other disciplinary actions that could harm ACC’s reputation or impact ACC’s results of operations. Further, any confidentialityfuture legislation or security obligations regarding vendor data or for losses relatedchanges to the data. In addition, the trend toward broad consumerlaws and general-public notification of such incidents could exacerbate the harmregulations applicable to ACC’s business reputation, financial condition or resultssuch as possible changes brought about by any U.S. Department of operations in the event of a breach. Even if ACC and its affiliates successfully protect ACC’s technology infrastructure and the confidentiality of sensitive data and conduct appropriate incident response, ACC may incur significant expenses in connection with ACC’s responses to any such attacks,Labor applicable regulation as well as state and other fiduciary rules, the adoption, implementationSEC best interest standards, or similar standards such as the Certified Financial Planner Board standards pertaining to the fiduciary status of investment advice providers to retirement investors (primarily account holders in 401(k) plans and maintenanceIRAs and other types of appropriate security measures. In addition,Employee Retirement Income Security Act of 1974, as amended (“ERISA”) clients) and related issues. Each of these has a potential impact regarding how ERISA investment advice fiduciaries and others can provide products manufactured by affiliates to, or engage in certain principal transactions with, retirement investors, including incremental requirements, costs and risks that may be imposed on ACC and its affiliates regulators may seek to hold ACC’s affiliate responsible for the acts, mistakes or omissions of AFS franchise advisors even where they procure and control much of the physical office space and technology infrastructure they use to operate their businesses locally.

ACC is subject to the income tax laws of the U.S., its states and municipalities. ACC must make judgments and interpretations about the application of these inherently complex tax laws when determining the provision for income taxes and must also make estimates about when in the future certain items affect taxable income in the various tax jurisdictions. In addition, changes to the Internal Revenue Code, administrative rulings or court decisions could increase ACC’s provision for income taxes and reduce ACC’s earnings. Furthermore, guidance issued by the U.S. Department of Treasury and others can be critical to the application and impact of new laws and in avoiding unintended impacts from legislation. The jurisdictions ACC operates in may not always provide clear guidance that are whollyis responsive to industry questions and concerns. If guidance is unclear, it could increase ACC’s taxes or partially beyond ACC’s control, adversely affecting ACC’s ability to process transactionscreate a potential for disagreement about interpretation of the tax code.

Many of the products that ACC or provide products and services to clients.

None.

ACC occupies office space in Minneapolis, Minnesota, which is leased or owned by Ameriprise Financial or a subsidiary thereof.

For a discussion of any material legal proceedings, see Note 1312 to ACC’sthe Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K, which is incorporated herein by reference.

Not applicable.

All of the Ameriprise Certificate Company (“ACC”) outstanding common stock is owned by Ameriprise Financial, Inc. (“Ameriprise Financial”). There is no established public trading market for ACC’s common stock.

Appropriated retained earnings resulting from the pre-declaration of additional credits to ACC’s certificate product owners are not available for the payment of dividends by ACC. In addition, ACC will discontinue issuance of certificates subject to the pre-declaration of additional credits and will make no further pre-declaration as to outstanding certificates if at any time the calculation of ACC’s capital and unappropriated retained earnings should be less than 5% of certificate reserves (less outstanding certificate loans).

The following information should be read in conjunction with the accompanying consolidated financial statementsAmeriprise Certificate Company’s (“ACC’s”) Consolidated Financial Statements and related notesNotes included elsewhere in this report. The following discussion may contain forward-looking statements that reflect Ameriprise Certificate Company’s (“ACC’s”)ACC’s plans, estimates and beliefs. ACC’s actualActual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed below under the heading “Forward-Looking Statements” and elsewhere in this report,Annual Report on Form 10-K, particularly in “Item 1A-RiskPart 1 - Item 1A - “Risk Factors.”

Management’s narrative analysis of the results of operations is presented in lieu of Management’s Discussion and Analysis of financial condition and results of operations, pursuant to General Instructions I(2)(a) of Form 10-K10-K.

ACC operates its business in lieuthe broader context of Management’s Discussionthe macroeconomic forces around it, including the global and Analysis of Financial ConditionU.S. economies, changes in interest and Results of Operations.

For information regarding recent accounting pronouncements and their expected impact on ACC’s future results of operations or financial condition and significant accounting policies, see Note 1 to ACC’s Consolidated Financial Statements beginning on page F-9 of this Annual Report on Form 10-K.

ACC’s net income is derived primarily from the after-tax yield on investments and realized investment gains (losses), less investment expenses and interest credited on certificate reserve liabilities. Net income trends occur largely due to changes in returns on ACC’s investment portfolio, from realization of investment gains (losses) and from changes in interest credited to certificate products. ACC follows U.S. generally accepted accounting principles (“GAAP”).

Net income decreased $14.4increased $44.3 million, or 33%77%, to $29.5 million for the year ended December 31, 20202023 compared to $43.9 million for the prior year primarily due to lowerhigher investment income,income. This increase was partially offset by lowerhigher net provision for certificate reserves tax expensealong with higher investment expenses and investment expenses.income taxes. ACC has experienced strong growth given the current market environment with client deposits increasing $4.2 billion from the prior year period to $13.5 billion.

Investment income decreased $98.7 million, or 42%, to $136.2increased $501.0 million for the year ended December 31, 20202023 compared to $234.9 million for the prior year primarily reflecting a decreasean increase in the average invested asset yield, driven by an increase in short-term interest rates, and lowerhigher average investment balances.

Investment expenses decreased $5.4increased $28.7 million, or 11%100%, to $42.4 million for the year ended December 31, 20202023 compared to $47.8 million for the prior year primarily due to volume-driven decreasesincreases in distribution, investment advisory, distribution, and transfer agent fees.

Net provision for certificate reserves decreased $72.6 million, or 56%, to $56.4increased $412.9 million, for the year ended December 31, 20202023 compared to $129.0 million for the prior year primarily due to lowerhigher average client crediting rates as well as lowerhigher average certificate balances.

The effective tax rate was 23.9%24.6% for 2023 compared to 24.8% for the year ended December 31, 2020 comparedprior year. See Note 11 to 24.0%the Consolidated Financial Statements for the year ended December 31, 2019.additional discussion on income taxes.

ACC reports certain assets and liabilities at fair value; specifically derivatives, embedded derivatives, and most investments and cash equivalents. Fair value assumes the exchange of assets or liabilities occurs in orderly transactions. Companies aretransactions and is not permitted to use market prices that are the result of a forced liquidation or distressed sale. ACC includes actual market prices, or observable inputs, in its fair value measurements to the extent available. Non-binding brokerBroker quotes are obtained when quotes from third-party pricing services are not available. ACC validates prices obtained from third parties through a variety of means such as: price variance analysis, subsequent sales testing, stale price review, price comparison across pricing vendors and due diligence reviews of vendors. See Note 8 to ACC’s Consolidated Financial Statements for additional information regarding ACC’s fair value measurements.

This report contains forward-looking statements that reflect management’s plans, estimates and beliefs. Actual results could differ materially from those described in these forward-looking statements. The words “believe,” “expect,” “anticipate,” “optimistic,” “intend,” “plan,” “aim,” “will,” “may,” “should,” “could,” “would,” “likely,” “forecast,” “on track,” “project”“project,” “continue,” “able to remain,” “resume,” “deliver,” “develop,” “evolve,” “drive,” “enable,” “flexibility,” “scenario,” “case”, “appear”, “expand” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors, which could cause actual results, performance or achievements to differ materially from expected results, performance or achievements. These statements are not guarantees or indicative of future performance. Important assumptions and other important factors that could cause actual results to differ materially from those forward-looking statements include, but are not limited to, those factors, risks and uncertainties described in “Item 1A-RiskPart 1 - Item 1A - “Risk Factors” and elsewhere in this Annual Report on Form 10-K. ACC’s future financial condition and results of operations and financial condition, as well as any forward-looking statements contained in this report, are made only as of the date hereof. ACC undertakes no obligation to update or revise any forward-looking statements.

ACC has three principal components of market risk: interest rate risk, equity price risk, and credit risk. Interest rate risk results from investing in assets that are somewhat longer and reset less frequently than the liabilities they support. ACC manages interest rate risk through the use of a variety of tools that from time to time include derivative instruments, such as interest rate swaps, caps, and floors, which change the interest rate characteristics of client liabilities or investment assets. Due to certain provisions for certificates being impacted by the value of equity indices, from time to time ACC enters into risk management strategies that may include the use of equity derivative instruments, such as equity options, to mitigate ACC’s exposure to volatility in the equity markets.

Ameriprise Financial’s Financial Risk Management Committee (“FRMC”), which is comprised of senior managers, holds regularly scheduled meetings to review models projecting various interest rate scenarios and risk/return measures and their effect on various portfolios managed by Columbia Management Investment Advisers, LLC (“CMIA”), a wholly owned subsidiary of Ameriprise Financial, including that of ACC. ACC’s Board of Directors has delegated the responsibilities of the Investment Committee of ACC to the FRMC. FRMC’s objectives are to structure ACC’s portfolio of investment securities based upon the type and behavior of the certificates in the certificate reserve liabilities, to achieve targeted levels of profitability within defined risk parameters and to meet certificate contractual obligations.

ACC primarily invests in structured investments (e.g., residential mortgage backed securities, commercial mortgage backed securities and asset backed securities andsecurities), U.S. government and agency obligations, corporate debt securities, and commercial mortgages to provide its certificate owners with a competitive rate of return on their certificates while managing risk. These investments provide ACC with a historically dependable and targeted margin between the interest rate earned on investments and the interest rate credited to certificate owners’ accounts. ACC does not invest in securities to generate short-term trading profits for its own account.

To evaluate interest rate and equity price risk, ACC performs sensitivity testing which measures the impact on pretax income from the sources listed below for a 12 month period following a hypothetical 100 basis point increase in interest rates and a hypothetical 10% decline in equity prices. The interest rate risk test assumes a sudden 100 basis point parallel shift in the yield curve, with rates then staying at those levels for the next 12 months. The equity price risk test assumes a sudden 10% drop in equity prices, with equity prices then staying at those levels for the next 12 months. In estimating the values of stock market certificates, ACC assumes no change in implied market volatility despite the 10% drop in equity prices.