EQUITABLE HOLDINGS, INC.

~~CONSOLIDATED BALANCE SHEETS~~Consolidated Balance Sheets

September 30, 2023 (Unaudited) and December 31, 2022

March 31,
2018 December 31,
2017
(Unaudited)
(in millions, except
share amounts)

ASSETS
Investments:
Fixed maturities available for sale, at fair value (amortized cost of $43,268 and $45,068) $ 43,484
$ 46,941
Mortgage loans on real estate (net of valuation allowance of $7 and $8) 11,333
10,952
Real estate held for production of income⁽¹⁾
52
390
Policy loans 3,776
3,819
Other equity investments⁽¹⁾
1,258
1,392
Trading securities, at fair value 14,919
14,170
Other invested assets⁽¹⁾
4,061
4,118
Total investments 78,883
81,782
Cash and cash equivalents⁽¹⁾
6,091
4,814
Cash and securities segregated, at fair value 1,025
825
Broker-dealer related receivables 2,300
2,158
Deferred policy acquisition costs 6,288
5,969
Goodwill and other intangible assets, net 4,813
4,824
Amounts due from reinsurers 4,953
5,023
Loans to affiliates 885
1,230
GMIB reinsurance contract asset, at fair value 1,734
1,894
Current and deferred tax assets 225
67
Other assets⁽¹⁾
3,239
2,510
Separate Accounts assets 121,858
124,552
Total assets $ 232,294
$ 235,648

LIABILITIES
Policyholders’ account balances $ 47,666
$ 47,171
Future policy benefits and other policyholders’ liabilities 29,586
30,299
Broker-dealer related payables 466
783
Securities sold under agreements to repurchase 1,904
1,887
Customers related payables 2,549
2,229
Amounts due to reinsurers 1,396
1,436
Short-term and Long-term debt⁽¹⁾
2,373
2,408




	September 30, 2023		December 31, 2022
	(in millions, except share data)
ASSETS
Investments:
Fixed maturities available-for-sale, at fair value (amortized cost of $74,340 and $72,991) (allowance for credit losses of $2 and $24)	$	63,470	$	63,361
Fixed maturities, at fair value using the fair value option (1)	1,634		1,508
Mortgage loans on real estate (net of allowance for credit losses of $209 and $129) (1)	17,655		16,481

Policy loans	4,089		4,033
Other equity investments (1)	3,272		3,152
Trading securities, at fair value	1,009		677
Other invested assets (1)	6,080		3,885
Total investments	97,209		93,097
Cash and cash equivalents (1)	6,096		4,281
Cash and securities segregated, at fair value	928		1,522
Broker-dealer related receivables	2,017		2,338
Deferred policy acquisition costs	6,599		6,369
Goodwill and other intangible assets, net	5,448		5,482
Amounts due from reinsurers (allowance for credit losses of $7 and $10)	8,271		8,471


Current and deferred income taxes	2,035		781
Purchased market risk benefits	8,745		10,423
Other assets (1)	3,945		4,033
Assets held-for-sale	681		562
Assets for market risk benefits	701		490
Separate Accounts assets	117,577		114,853
Total Assets	$	260,252	$	252,702
LIABILITIES
Policyholders’ account balances	$	91,912	$	83,866
Liability for market risk benefits	13,011		15,766
Future policy benefits and other policyholders' liabilities	16,647		16,603
Broker-dealer related payables	454		715

Customer related payables	2,321		3,323
Amounts due to reinsurers	1,424		1,533
Short-term debt	—		759
Long-term debt	3,820		3,322


Notes issued by consolidated variable interest entities, at fair value using the fair value option (1)	1,541		1,150
Other liabilities (1)	7,412		7,108
Liabilities held-for-sale	216		108
Separate Accounts liabilities	117,577		114,853
Total Liabilities	$	256,335	$	249,106
Redeemable noncontrolling interest (1) (2)	$	636	$	455
Commitments and contingent liabilities (3)
EQUITY
Equity attributable to Holdings:
Preferred stock and additional paid-in capital, $1 par value and $25,000 liquidation preference	$	1,562	$	1,562
Common stock, $0.01 par value, 2,000,000,000 shares authorized; 495,418,509 and 508,418,442 shares issued, respectively; 342,074,647 and 365,081,940 shares outstanding, respectively	3		4
Additional paid-in capital	2,308		2,299
Treasury stock, at cost, 153,448,479 and 143,336,502 shares, respectively	(3,592)		(3,297)
Retained earnings	11,163		9,825
Accumulated other comprehensive income (loss)	(9,802)		(8,992)
Total equity attributable to Holdings	1,642		1,401
Noncontrolling interest	1,639		1,740
Total Equity	3,281		3,141
Total Liabilities, Redeemable Noncontrolling Interest and Equity	$	260,252	$	252,702

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~CONSOLIDATED BALANCE SHEETS—CONTINUED~~

March 31,
2018 December 31,
2017
(Unaudited)
(in millions, except
share amounts)
Loans from affiliates 2,530
3,622
Other liabilities⁽¹⁾
4,342
4,053
Separate Accounts liabilities 121,858
124,552
Total liabilities $ 214,670
$ 218,440
Redeemable noncontrolling interest⁽¹⁾
$ 1,024
$ 626
Commitments and contingent liabilities (Note 14)

EQUITY
Equity attributable to Holdings:
Common stock, $0.01 par value, 2,000,000,000 shares authorized and 561,000,000 issued and outstanding $ 6
$ 6
Capital in excess of par value 2,050
1,298
Retained earnings 12,455
12,289
Accumulated other comprehensive income (loss) (946 ) (108 )
Total equity attributable to Holdings 13,565
13,485
Noncontrolling interest 3,035
3,097
Total equity 16,600
16,582
Total Liabilities, Redeemable Noncontrolling Interest and Equity $ 232,294
$ 235,648

____________

(1) See Note 2 of the Notes to these Consolidated Financial Statements for details of balances with ~~variable interest entities.~~VIEs.

(2) See Note 15 of the Notes to these Consolidated Financial Statements for details of redeemable noncontrolling interest.

(3) See Note 16 of the Notes to these Consolidated Financial Statements for details of commitments and contingent liabilities.

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

~~Table of Contents~~

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~CONSOLIDATED STATEMENTS OF INCOME (LOSS)~~Consolidated Statements of Income (Loss)

~~(UNAUDITED)~~

Three and Nine Months Ended September 30, 2023 and 2022 (Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions, except per share data)
REVENUES
Policy charges and fee income	$	599	$	603	$	1,781	$	1,873
Premiums	267		259		823		744
Net derivative gains (losses)	615		199		(1,143)		2,216
Net investment income (loss)	1,071		842		3,097		2,357
Investment gains (losses), net:
Credit and intent to sell losses on available for sale debt securities and loans	(65)		(267)		(145)		(266)
Other investment gains (losses), net	(346)		(65)		(409)		(624)
Total investment gains (losses), net	(411)		(332)		(554)		(890)
Investment management and service fees	1,217		1,179		3,579		3,731
Other income	266		242		775		797
Total revenues	3,624		2,992		8,358		10,828

BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	693		629		2,107		2,020
Remeasurement of liability for future policy benefits	49		20		46		54
Change in market risk benefits and purchased market risk benefits	(817)		(491)		(1,772)		(144)
Interest credited to policyholders’ account balances	556		378		1,520		1,001
Compensation and benefits	593		568		1,742		1,682
Commissions and distribution-related payments	405		368		1,178		1,184
Interest expense	55		51		171		148
Amortization of deferred policy acquisition costs	165		148		472		436
Other operating costs and expenses	450		496		1,339		1,613
Total benefits and other deductions	2,149		2,167		6,803		7,994
Income (loss) from continuing operations, before income taxes	1,475		825		1,555		2,834
Income tax (expense) benefit	(340)		(177)		677		(578)
Net income (loss)	1,135		648		2,232		2,256
Less: Net income (loss) attributable to the noncontrolling interest (1)	71		54		232		165
Net income (loss) attributable to Holdings	1,064		594		2,000		2,091
Less: Preferred stock dividends	14		14		54		54
Net income (loss) available to Holdings’ common shareholders	$	1,050	$	580	$	1,946	$	2,037

EARNINGS PER COMMON SHARE
Net income (loss) applicable to Holdings’ common shareholders per common share:
Basic	$	3.03	$	1.55	$	5.49	$	5.35
Diluted	$	3.02	$	1.54	$	5.47	$	5.32
Weighted average common shares outstanding (in millions):
Basic	346.4		374.5		354.4		380.6
Diluted	348.0		376.8		355.9		382.9

Three Months Ended
March 31,
2018 2017
(in millions, except earnings per share amounts)
REVENUES
Policy charges and fee income $ 972
$ 956
Premiums 279
281
Net derivative gains (losses) (281 ) (235 )
Net investment income (loss) 591
780
Investment gains (losses), net:
Total other-than-temporary impairment losses —
(1 )
Other investment gains (losses), net 102
(23 )
Total investment gains (losses), net 102
(24 )
Investment management and service fees 1,055
954
Other income 117
118
Total revenues 2,835
2,830
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits 608
1,093
Interest credited to policyholders’ account balances 271
246
Compensation and benefits (includes $40 and $41 of deferred acquisition costs) 620
539
Commissions and distribution related payments (includes $120 and $132 of deferred acquisition costs) 411
395
Interest expense 46
35
Amortization of deferred policy acquisition costs, net (net of capitalization of $160 and $173) 15
(55 )
Other operating costs and expenses 494
744
Total benefits and other deductions 2,465
2,997
Income (loss) from continuing operations, before income taxes 370
(167 )
Income tax (expense) benefit (79 ) (30 )
Net income (loss) 291
(197 )
Less: net (income) loss attributable to the noncontrolling interest (123 ) (93 )
Net income (loss) attributable to Holdings $ 168
$ (290 )

EARNINGS PER SHARE
Earnings per share - Common stock
Basic $ 0.30
$ (0.52 )
Diluted $ 0.30
$ (0.52 )
Weighted average common shares outstanding 561
561
____________

(1) Includes redeemable noncontrolling interest. See Note 15 of the Notes to these Consolidated Financial Statements for details of redeemable noncontrolling interest.

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

~~Table of Contents~~

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)~~Consolidated Statements of Comprehensive Income (Loss)

~~(UNAUDITED)~~Three and Nine Months Ended September 30, 2023 and 2022 (Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
COMPREHENSIVE INCOME (LOSS)
Net income (loss)	$	1,135	$	648	$	2,232	$	2,256
Other comprehensive income (loss) net of income taxes:
Change in unrealized gains (losses), net of reclassification adjustment	(1,766)		(2,784)		(764)		(11,814)
Change in market risk benefits - instrument-specific credit risk	(1,086)		(198)		(235)		2,501
Change in liability for future policy benefits - current discount rate	195		279		157		1,126
Change in defined benefit plan related items not yet recognized in periodic benefit cost, net of reclassification adjustment	6		16		35		61
Foreign currency translation adjustment	(16)		(30)		(5)		(75)
Total other comprehensive income (loss), net of income taxes	(2,667)		(2,717)		(812)		(8,201)
Comprehensive income (loss)	(1,532)		(2,069)		1,420		(5,945)
Less: Comprehensive income (loss) attributable to the noncontrolling interest	64		42		230		137
Comprehensive income (loss) attributable to Holdings	$	(1,596)	$	(2,111)	$	1,190	$	(6,082)

Three Months Ended
March 31,
2018 2017
(in millions)
COMPREHENSIVE INCOME (LOSS)
Net income (loss) $ 291
$ (197 )
Other comprehensive income (loss) net of income taxes:
Foreign currency translation adjustment (5 ) 8
Change in unrealized gains (losses), net of reclassification adjustment (960 ) 104
Changes in defined benefit plan related items not yet recognized in periodic benefit cost, net of reclassification adjustment 133
25
Total other comprehensive income (loss), net of income taxes (832 ) 137
Comprehensive income (loss) (541 ) (60 )
Less: Comprehensive (income) loss attributable to noncontrolling interest (129 ) (100 )
Comprehensive income (loss) attributable to Holdings $ (670 ) $ (160 )

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

~~Table of Contents~~

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~CONSOLIDATED STATEMENTS OF EQUITY~~Consolidated Statements of Equity

~~(UNAUDITED)~~For the Three and Nine Months Ended September 30, 2023 and 2022 (Unaudited)


	Three Months Ended September 30,
	Equity Attributable to Holdings
	Preferred Stock and Additional Paid-In Capital		Common Stock		Additional Paid-in Capital		Treasury Stock		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total Holdings Equity		Non-controlling Interest		Total Equity
			(in millions)
Balance, beginning of period	$	1,562	$	4	$	2,297	$	(3,493)	$	10,325	$	(7,142)	$	3,553	$	1,707	$	5,260
Stock compensation	—		—		14		(2)		—		—		12		4		16
Purchase of treasury stock	—		(1)		(4)		(233)		—		—		(238)		—		(238)
Reissuance of treasury stock	—		—		—		—		1		—		1		—		1
Retirement of common stock	—		—		—		136		(136)		—		—		—		—
Repurchase of AB Holding units	—		—		—		—		—		—		—		(52)		(52)
Dividends paid to noncontrolling interest	—		—		—		—		—		—		—		(78)		(78)

Dividends on common stock (cash dividends declared per common share of $0.22)	—		—		—		—		(77)		—		(77)		—		(77)
Issuance of preferred stock	—		—		—		—		—		—		—		—		—
Dividends on preferred stock	—		—		—		—		(14)		—		(14)		—		(14)
Net income (loss)	—		—		—		—		1,064		—		1,064		65		1,129
Other comprehensive income (loss)	—		—		—		—		—		(2,660)		(2,660)		(7)		(2,667)
Other	—		—		1		—		—		—		1		—		1
September 30, 2023	$	1,562	$	3	$	2,308	$	(3,592)	$	11,163	$	(9,802)	$	1,642	$	1,639	$	3,281

Three Months Ended
March 31,
2018 2017
(in millions)
Equity attributable to Holdings:
Common stock, at par value, beginning of year and end of period $ 6
$ 6

Capital in excess of par value, beginning of year $ 1,298
$ 931
Capital contribution from parent 695
—
Changes in capital in excess of par value 57
11
Capital in excess of par value, end of period $ 2,050
$ 942

Retained earnings, beginning of year $ 12,289
$ 11,439
Impact of adoption of revenue recognition standard ASC 606 13
—
Net income (loss) 168
(290 )
Stockholder dividends (15 ) —
Retained earnings, end of period $ 12,455
$ 11,149

Accumulated other comprehensive income (loss), beginning of year $ (108 ) $ (921 )
Other comprehensive income (loss) (838 ) 130
Accumulated other comprehensive income (loss), end of period (946 ) (791 )
Total Holdings’ equity, end of period $ 13,565
$ 11,306

Noncontrolling interest, beginning of year $ 3,097
$ 3,142
Impact of adoption of revenue recognition standard ASC 606 19
—
Repurchase of AB Holding units (1 ) —
Net income (loss) attributable to noncontrolling interest 103
77
Dividends paid to noncontrolling interest (135 ) (108 )
Other comprehensive income (loss) attributable to noncontrolling interest 6
7
Other changes in noncontrolling interest (54 ) (13 )
Noncontrolling interest, end of period 3,035
3,105
Total Equity, End of Period $ 16,600
$ 14,411


Balance, beginning of period	$	1,562	$	4	$	1,918	$	(3,065)	$	9,447	$	(4,165)	5,701		$	1,410	$	7,111
Stock compensation	—		—		33		3		—		—		36		9		45
Purchase of treasury stock	—		—		(1)		(200)		—		—		(201)		—		(201)
Reissuance of treasury stock	—		—		—		—		(3)		—		(3)		—		(3)
Retirement of common stock	—		—		—		60		(60)		—		—		—		—
Repurchase of AB Holding units	—		—		—		—		—		—		—		(1)		(1)
Dividends paid to noncontrolling interest	—		—		—		—		—		—		—		(79)		(79)
Issuance of AB Units for CarVal acquisition	—		—		55		—		—		—		55		78		133
Dividends on common stock (cash dividends declared per common share of $0.20)	—		—		—		—		(75)		—		(75)		—		(75)
Dividends on preferred stock	—		—		—		—		(14)		—		(14)		—		(14)


Net income (loss)	—		—		—		—		594		—		594		62		656

Other comprehensive income (loss)	—		—		—		—		—		(2,705)		(2,705)		(12)		(2,717)
Other	—		—		22		—				—		22		12		34
September 30, 2022	$	1,562	$	4	$	2,027	$	(3,202)	$	9,889	$	(6,870)	$	3,410	$	1,479	$	4,889

See Notes to Consolidated Financial Statements (Unaudited).

~~Table of Contents~~

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~CONSOLIDATED STATEMENTS OF CASH FLOWS~~Consolidated Statements of Equity

~~(UNAUDITED)~~

Three and Nine Months Ended September 30, 2023 and 2022 (Unaudited)


	Nine Months Ended September 30,
	Equity Attributable to Holdings
	Preferred Stock and Additional Paid-In Capital		Common Stock		Additional Paid-in Capital		Treasury Stock		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total Holdings Equity		Non-controlling Interest		Total Equity
	(in millions)
Balance, beginning of period	$	1,562	$	4	$	2,299	$	(3,297)	$	9,825	$	(8,992)	$	1,401	$	1,740	$	3,141

Stock compensation	—		—		40		20		—		—		60		19		79
Purchase of treasury stock	—		(1)		(7)		(670)		—		—		(678)		—		(678)
Reissuance of treasury stock	—		—		—		—		(26)		—		(26)		—		(26)
Retirement of common stock	—		—		—		355		(355)		—		—		—		—
Repurchase of AB Holding units	—		—		—		—		—		—		—		(71)		(71)
Dividends paid to noncontrolling interest	—		—		—		—		—		—		—		(252)		(252)

Dividends on common stock (cash dividends declared per common share of $0.64)	—		—		—		—		(227)		—		(227)		—		(227)
Dividends on preferred stock	—		—		—		—		(54)		—		(54)		—		(54)

Net income (loss)	—		—		—		—		2,000		—		2,000		208		2,208
Other comprehensive income (loss)	—		—		—		—		—		(810)		(810)		(2)		(812)
Other	—		—		(24)		—		—		—		(24)		(3)		(27)
September 30, 2023	$	1,562	$	3	$	2,308	$	(3,592)	$	11,163	$	(9,802)	$	1,642	$	1,639	$	3,281

Three Months Ended
March 31,
2018 2017
(in millions)
Net income (loss) $ 291
$ (197 )
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Interest credited to policyholders’ account balances 271
246
Policy charges and fee income (972 ) (956 )
Realized and unrealized gains (losses) on trading securities 120
(91 )
Net derivative (gains) losses 281
235
Investment (gains) losses, net (102 ) 24
Non-cash pension restructuring 102
—
Amortization of deferred compensation 12
8
Amortization of deferred sales commission 7
9
Other depreciation and amortization (20 ) (42 )
Amortization of deferred cost of reinsurance asset 5
5
Change in goodwill —
369
Distribution from joint ventures and limited partnerships 25
26
Changes in:
Net broker-dealer and customer related receivables/payables 283
297
Reinsurance recoverable 32
27
Segregated cash and securities, net (208 ) (310 )
Deferred policy acquisition costs 15
(55 )
Future policy benefits (254 ) 296
Current and deferred income taxes 103
252
Other, net (255 ) (71 )
Net cash provided by (used in) operating activities (264 ) 72

Cash flows from investing activities:
Proceeds from the sale/maturity/prepayment of:
Fixed maturities, available for sale 4,288
1,033
Mortgage loans on real estate 68
209
Trading account securities 1,629
2,844
Other 54
56
Payment for the purchase/origination of:
Fixed maturities, available for sale (3,245 ) (1,428 )
Mortgage loans on real estate (447 ) (632 )
Trading account securities (2,613 ) (3,928 )
Other (48 ) (28 )
Cash settlements related to derivative instruments (54 ) (1,400 )
Decrease in loans to affiliates 346
12
Change in short-term investments 876
573


Balance, beginning of period	$	1,562	$	4	$	1,919	$	(2,850)	$	8,413	$	1,303	$	10,351	$	1,576	$	11,927
Stock compensation	—		—		68		39		—		—		107		36		143
Purchase of treasury stock	—		—		(6)		(693)		—		—		(699)		—		(699)
Reissuance of treasury stock	—		—		—		—		(39)		—		(39)		—		(39)
Retirement of common stock	—		—		—		302		(302)		—		—		—		—
Repurchase of AB Holding units	—		—		—		—		—		—		—		(108)		(108)
Dividends paid to noncontrolling interest	—		—		—		—		—		—		—		(318)		(318)
Issuance of AB Units for CarVal acquisition	—		—		55		—		—		—		55		78		133
Dividends on common stock (cash dividends declared per common share of $0.58)	—		—		—		—		(220)		—		(220)		—		(220)
Dividends on preferred stock	—		—		—		—		(54)		—		(54)		—		(54)

Net income (loss)	—		—		—		—		2,091		—		2,091		229		2,320
Other comprehensive income (loss)	—		—		—		—		—		(8,173)		(8,173)		(28)		(8,201)
Other	—		—		(9)		—		—		—		(9)		14		5
September 30, 2022	$	1,562	$	4	$	2,027	$	(3,202)	$	9,889	$	(6,870)	$	3,410	$	1,479	$	4,889

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long Duration Contracts.

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~CONSOLIDATED STATEMENTS OF CASH FLOWS—CONTINUED~~

~~(UNAUDITED)~~

Three Months Ended
March 31,
2018 2017
Investment in capitalized software, leasehold improvements and EDP equipment (24 ) (19 )
Other, net (371 ) (191 )
Net cash provided by (used in) investing activities 459
(2,899 )

Cash flows from financing activities:
Policyholders’ account balances:
Deposits 2,532
2,790
Withdrawals (1,384 ) (1,342 )
Transfer (to) from Separate Accounts (102 ) 186
Change in short-term financings 167
95
Repayment of loans from affiliates —
(56 )
Proceeds from loans from affiliates —
109
Change in collateralized pledged assets 17
347
Change in collateralized pledged liabilities 56
967
(Decrease) increase in overdrafts payable 7
50
Cash Contribution from Parent 8
—
Shareholder dividend paid (15 ) —
Repurchase of AB Holding units (1 ) (31 )
Redemptions of non-controlling interests of consolidated VIEs, net 373
(3 )
Distribution to noncontrolling interests in consolidated subsidiaries (135 ) (112 )
Increase (decrease) in Securities sold under agreement to repurchase 17
(370 )
Increase (decrease) in loans from affiliates (470 ) —
Other, net 4
—
Net cash provided by (used in) financing activities 1,074
2,630
Effect of exchange rate changes on cash and cash equivalents 8
8
Change in cash and cash equivalents 1,277
(189 )
Cash and cash equivalents, beginning of year 4,814
5,654
Cash and Cash Equivalents, End of Period $ 6,091
$ 5,465

Non-cash transactions during the Period
Capital contribution from Parent $ 630
$ —
Repayment of Loans from affiliates $ (622 ) $ —
Contribution of 0.5% minority interest in AXF $ 65
$ —
Repayment of long-term debt $ 202
$ —

See Notes to Consolidated Financial Statements (Unaudited).

EQUITABLE HOLDINGS, INC.

Consolidated Statements of Cash Flows

Nine Months Ended September 30, 2023 and 2022 (Unaudited)


	Nine Months Ended September 30,
	2023		2022
	(in millions)
Cash flows from operating activities:
Net income (loss)	$	2,232	$	2,256
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Interest credited to policyholders’ account balances	1,520		1,001
Policy charges and fee income	(1,781)		(1,873)
Net derivative (gains) losses	1,143		(2,216)
Credit and intent to sell losses on available for sale debt securities and loans	145		266
Investment (gains) losses, net	409		624
(Gains) losses on businesses held-for-sale	3		—
Realized and unrealized (gains) losses on trading securities	(17)		239
Non-cash long-term incentive compensation expense	59		104
Amortization and depreciation	576		391
Remeasurement of liability for future policy benefits	46		54
Change in market risk benefits	(1,772)		(144)
Equity (income) loss from limited partnerships	(81)		(128)
Changes in:
Net broker-dealer and customer related receivables/payables	(996)		(195)
Reinsurance recoverable	(1,106)		(393)
Segregated cash and securities, net	595		169
Capitalization of deferred policy acquisition costs	(702)		(644)
Future policy benefits	196		(477)
Current and deferred income taxes	(868)		460
Other, net	584		195
Net cash provided by (used in) operating activities	$	184	$	(311)

Cash flows from investing activities:
Proceeds from the sale/maturity/pre-payment of:
Fixed maturities, available-for-sale	$	7,978	$	14,413
Fixed maturities, at fair value using the fair value option	323		433
Mortgage loans on real estate	353		901
Trading account securities	665		205

Short term investments	2,704		313
Other	631		454
Payment for the purchase/origination of:
Fixed maturities, available-for-sale	(9,753)		(17,022)
Fixed maturities, at fair value using the fair value option	(417)		(416)
Mortgage loans on real estate	(1,567)		(2,604)
Trading account securities	(994)		(185)
Short term investments	(2,410)		(676)
Other	(816)		(992)
Purchase of business, net of cash acquired	—		40

Cash settlements related to derivative instruments, net	(1,702)		799

See Notes to Consolidated Financial Statements (Unaudited).

EQUITABLE HOLDINGS, INC.

Consolidated Statements of Cash Flows

Nine Months Ended September 30, 2023 and 2022 (Unaudited)


	Nine Months Ended September 30,
	2023		2022
	(in millions)
Investment in capitalized software, leasehold improvements and EDP equipment	(82)		(102)
Other, net	121		167
Net cash provided by (used in) investing activities	$	(4,966)	$	(4,272)
Cash flows from financing activities:
Policyholders’ account balances:
Deposits	$	12,690	$	11,680
Withdrawals	(6,729)		(5,011)
Transfers (to) from Separate Accounts	974		1,148
Payments of market risk benefits	(559)		(434)
Change in short-term financings	(759)		155
Change in collateralized pledged assets	(127)		37
Change in collateralized pledged liabilities	1,232		(2,472)
(Decrease) increase in overdrafts payable	3		(20)

Issuance of long-term debt	497		—

Repayment of acquisition-related debt obligation	—		(43)
Proceeds from collateralized loan obligations	40		—
Proceeds from notes issued by consolidated VIEs	362		(34)
Dividends paid on common stock	(227)		(220)
Dividends paid on preferred stock	(54)		(54)


Purchases of AB Holding Units to fund long-term incentive compensation plan awards	(71)		(108)
Purchase of treasury shares	(678)		(699)
Purchases (redemptions) of noncontrolling interests of consolidated company-sponsored investment funds	161		(49)
Distribution to noncontrolling interest of consolidated subsidiaries	(252)		(318)
Changes in securities lending payable	113		—
Other, net	(3)		65
Net cash provided by (used in) financing activities	$	6,613	$	3,624

Effect of exchange rate changes on cash and cash equivalents	$	(2)	$	(90)
Change in cash and cash equivalents	1,829		(1,049)
Cash and cash equivalents, beginning of period	4,281		5,188
Change in cash of businesses held-for-sale	(14)		—
Cash and cash equivalents, end of period	$	6,096	$	4,139





Non-cash transactions from investing and financing activities:
Right-of-use assets obtained in exchange for lease obligations	$	48	$	54

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

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~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~Notes to Consolidated Financial Statements (Unaudited)

1) ORGANIZATION

~~Business~~

~~AXA~~ Equitable Holdings, Inc. ~~(“Holdings” and, collectively with its consolidated subsidiaries, the “Company”)~~ is the holding company for a diversified financial services organization. In May 2017, AXA S.A. (“AXA”), a French holding company for the AXA Group, a worldwide leader in life, property and casualty and health insurance and asset management, announced its intention to pursue the sale of a minority stake in Holdings through an initial public offering (the “IPO”). On May 14, 2018, Holdings completed the IPO in which AXA sold 157,837,500 shares of Holdings common stock to the public. Following the IPO, AXA owns approximately 71.9% of the outstanding common stock of Holdings.

The Company conducts operations in ~~four~~six segments: Individual Retirement, Group Retirement, Investment Management and Research, Protection Solutions, Wealth Management and ~~Protection Solutions.~~Legacy. The Company’s management evaluates the performance of each of these segments independently. See Note 17 of the Notes to these Consolidated Financial Statements for further information on the change to the reportable segments in the first quarter of 2023, which was retrospectively applied.

•The Individual Retirement segment offers a diverse suite of variable annuity products which are primarily sold to affluent and high net worth individuals saving for retirement or seeking retirement income.

•The Group Retirement segment offers tax-deferred investment and retirement services or products to plans sponsored by educational entities, municipalities and not-for-profit entities, as well as small and medium-sized businesses.

•The Investment Management and Research segment provides diversified investment management, research and related solutions globally to a broad range of clients through three main client ~~channels—~~channels - Institutional, Retail and Private Wealth ~~Management—~~- and distributes its institutional research products and solutions through Bernstein Research Services. The Investment Management and Research segment reflects the business of ~~AllianceBernstein~~AB Holding ~~L.P. (“AB Holding”), AllianceBernstein L.P. (“ABLP”)~~and ABLP and their subsidiaries (collectively, ~~“AB”)~~AB).

•The Protection Solutions segment includes the Company’s life insurance and group employee benefits businesses. The life insurance business offers a variety of ~~variable universal life, indexed universal life~~VUL, IUL and term life products to help affluent and high net worth individuals, as well as small and medium-sized business owners, with their wealth protection, wealth transfer and corporate needs. Our group employee benefits business offers a suite of life, short- and long-term disability, dental and vision insurance products to small and medium-size businesses across the United States.

•The Wealth Management segment is an emerging leader in the wealth management space with a differentiated advice value proposition that offers discretionary and non-discretionary investment advisory accounts, financial planning and advice, life insurance, and annuity products. In 2023, we began reporting this business separately from our Individual Retirement, Group Retirement and Protection Solutions segments as well as Corporate and Other.

•The Legacy segment consists of our capital intensive fixed-rate GMxB business written prior to 2011. In 2023, we began reporting this business separately from our Individual Retirement business.

The Company reports certain activities and items that are not included in our segments in Corporate and Other. Corporate and Other includes certain of our financing and investment expenses. It also ~~includes: the AXA Advisors broker-dealer business,~~includes closed block of life insurance (the “Closed Block”), run-off variable annuity reinsurance business, run-off group pension business, run-off health business, benefit plans for our employees, certain strategic investments and certain unallocated items, including capital and related investments, interest expense and corporate expense. AB’s results of operations are reflected in the Investment Management and Research segment. Accordingly, Corporate and Other does not include any items applicable to AB.

~~At March~~As of September 30, 2023 and December 31, 2018 and March 31, 2017, the Company’s economic interest in AB was 46.5% and 45.8%, respectively. At March 31, 2018 and March 31, 2017, respectively, AXA and its subsidiaries’ economic interest in AB was 64.4% and 63.8%.

~~In March 2018, AXA contributed the 0.5% minority interest in AXA Financial, Inc. (“AXA Financial”) to Holdings so that Holdings now owns 100% of AXA Financial.~~

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

On April 23, 2018, Holdings entered into a Purchase Agreement (the “Purchase Agreement”) with Coliseum Reinsurance Company (“Coliseum”), an affiliate, relating to the purchase and sale of all of the units of limited partnership of ABLP (the “AB Units”) owned by Coliseum. Pursuant to the Purchase Agreement, Holdings purchased from Coliseum 8,160,000 AB Units owned by Coliseum at a purchase price of $26.54 per AB Unit.

On April 23, 2018, Holdings entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) with AXA Investment Managers S.A., an affiliate, relating to the purchase and sale of all of the issued and outstanding shares of common stock of AXA-IM Holding U.S., Inc. As a result of the transactions contemplated by the Stock Purchase Agreement, Holdings acquired beneficial ownership to the 41,934,582 AB Units owned by AXA-IM Holding U.S., Inc.

~~As a result of these transactions, at April 30, 2018,~~2022, the Company’s economic interest in AB was approximately ~~65.0%.~~62% and 61%, respectively. The ~~general partner~~General Partner of AB ~~AllianceBernstein Corporation (the “General Partner”),~~ is a ~~wholly-owned~~wholly owned subsidiary of the Company. Because the General Partner has the authority to manage and control the business of AB, AB is consolidated in the Company’s financial ~~statements.~~statements for all periods presented.

~~See Note 18 to the Notes to Consolidated Financial Statements for additional information on these subsequent events.~~

2) SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The ~~Unaudited Interim Consolidated Financial Statements~~unaudited interim consolidated financial statements (the “consolidated financial statements”) have been prepared in ~~accordance~~conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”) on a basis consistent with reporting interim financial information in accordance with instructions to the Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (“SEC”). ~~Intercompany balances and transactions have been eliminated.~~

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

In the opinion of management, all adjustments necessary for a fair statement of the financial position and results of operations have been made. All such adjustments are of a normal, recurring nature. Interim results are not necessarily indicative of the results that may be expected for the full year. These financial statements should be read in conjunction with the Company’s ~~Consolidated Financial Statements~~consolidated financial statements included in the ~~Company’s~~Recast 2022 Annual ~~Report on Form 10-K for~~Report. Certain prior period amounts were adjusted to reflect the ~~year ended December 31, 2017.~~adoption of ASU 2018-12: Financial Services - Insurance (Topic 944).

The accompanying unaudited consolidated financial statements present the consolidated results of operations, financial condition, and cash flows of the Company and its subsidiaries and those investment companies, partnerships and joint ventures in which the Company has control and a majority economic interest as well as those variable interest entities (“VIEs”) that meet the requirements for consolidation.

All significant intercompany transactions and balances have been eliminated in consolidation. The terms ~~“first~~“third quarter ~~2018”~~2023” and ~~“first~~“third quarter ~~2017”~~2022” refer to the three months ended ~~March 31, 2018~~September 30, 2023 and ~~2017,~~2022, respectively. The terms “first ~~three~~nine months of ~~2018”~~2023” and “first ~~three~~nine months of ~~2017”~~2022” refer to the ~~three~~nine months ended ~~March 31, 2018~~September 30, 2023 and ~~2017,~~2022, respectively.

~~2) SIGNIFICANT ACCOUNTING POLICIES~~

Adoption of New Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued new guidance that revises the recognition criteria for revenue arising from contracts with customers to provide goods or services, except when those revenue streams are from insurance and investment contracts, leases, rights and obligations that are in the scope of certain financial instruments (i.e., derivative contracts) and guarantees other than product or service warranties, for which existing revenue recognition requirements are not superseded by this guidance. On January 1, 2018, the Company adopted the new revenue recognition guidance on a modified retrospective basis and is providing in its first quarter 2018 reporting the additional disclosures required by the new standard. Adoption of this new guidance did not change the amounts or timing of the Company’s revenue recognition for base investment management and advisory fees, distribution revenues, shareholder servicing revenues, and broker-dealer revenues. However, some performance-based fees and carried-interest distributions that prior to adoption were recognized when no risk of reversal remained, in certain instances under the new standard may be recognized earlier if it is probable that significant reversal will not occur. As a result, on January 1, 2018, the Company recognized a cumulative effect adjustment, net of tax, to increase opening equity attributable to Holdings and the noncontrolling interest by approximately $13 million and $19 million,


Description			Effect on the Financial Statement or Other Significant Matters
ASU 2018-12: Financial Services - Insurance (Topic 944)
This ASU provides targeted improvements to existing recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. The ASU primarily impacts four key areas, including: 1. Measurement of the liability for future policy benefits for traditional and limited payment contracts. The ASU requires companies to review, and if necessary, update cash flow assumptions at least annually for non-participating traditional and limited-payment insurance contracts. The ASU also prescribes the discount rate to be used in measuring the liability for future policy benefits for traditional and limited payment long-duration contracts. 2. Measurement of Market Risk Benefits (“MRBs”). MRBs, as defined under the ASU, will encompass certain GMxB features associated with variable annuity products and other general account annuities with other than nominal market risk. 3. Amortization of deferred acquisition costs. The ASU simplifies the amortization of deferred acquisition costs and other balances amortized in proportion to premiums, gross profits, or gross margins, requiring such balances to be amortized on a constant level basis over the expected term of the contracts. 4. Expanded footnote disclosures. The ASU requires additional disclosures including information about significant inputs, judgements, assumptions and methods used in measurement.			On January 1, 2023, the Company adopted the new accounting standard ASU 2018-12 using the modified retrospective approach, except for MRBs which will use the full retrospective approach. Refer to “Transition impact of ASU 2018-12, Financial Services- Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts” section within this note for further details.

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~respectively, reflecting the~~Transition impact of carried-interest distributions previously received by AB of approximately $78 million, net of revenue sharing payments to investment team members of approximately $43 million, for which it is probable that significant reversal will not occur and for which incremental tax is provided at Holdings.

~~In January 2016, the FASB issued new guidance related~~ASU 2018-12, Financial Services—Insurance (Topic 944): Targeted Improvements to the ~~recognition and measurement of~~Accounting for Long-Duration Contracts

The Company has not retrospectively adjusted its consolidated financial assets and financial liabilities. The new guidance primarily affects the accounting for equity investments, financial liabilities under the fair value option, and presentation and disclosure requirements for financial instruments. In addition, the FASB clarified guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale (“AFS”) debt securities. The new guidance requires equity investments in unconsolidated entities, except those accounted for under the equity method, to be measured at fair value through earnings, thereby eliminating the AFS classification for equity securities with readily determinable fair values for which changes in fair value currently are reported in Accumulated Other Comprehensive Income (Loss) (“AOCI”). On January 1, 2018, the Company adopted the new recognition requirements on a modified retrospective basis for changes in the fair value of AFS equity securities, resulting in no material reclassification adjustment from AOCI to opening retained earningsstatements for the ~~net unrealized gains, net of tax, related~~year ended December 31, 2020 to approximately $46 million common stock securities and eliminated their designation as AFS equity securities. The new guidance does not apply to FHLB common stock and prohibits such investments from being classified as equity securities subject to the new guidance. Accordingly, the Company has classified its investment in the FHLB common stock as other invested assets at March 31, 2018. The Company’s investment assets held in the form of equity interests in unconsolidated entities, such as limited partnerships and limited liability companies, including hedge funds, private equity funds, and real estate-related funds, generally are accounted for under the equity method and were not impacted by this new guidance. The Company does not currently report any of its financial liabilities under the fair value option.

In March 2017, the FASB issued new guidance on the presentation of net periodic pension and post-retirement benefit costs that requires retrospective disaggregation of the service cost component from the other components of net benefit costs on the income statement. The service cost component is required to be presented with other employee compensation costs in “income from operations,” and the remaining components are to be reported separately outside of income from operations. While this standard did not change how net periodic pension and post-retirement benefit costs are measured, it limits the amount eligible for capitalization on a prospective basis to the service cost component. On January 1, 2018, the Company adopted the change in the income statement presentation utilizing the practical expedient for determining the historical components of net benefit costs, resulting in no material impact to the consolidated financial statements. In addition, no changes to the Company’s capitalization policies with respect to benefit costs resulted fromreflect the adoption of ~~the new guidance.~~

In May 2017, the FASB issued guidance on share-based payments. The amendment provides clarity intended to reduce diversity in practice and the cost and complexity of accounting for changes to the terms or conditions of share-based payment awards. The new guidance is effective for interim and annual periods beginning after December 15, 2017 and requires prospective application to awards modified on or after the date of adoption. Adoption of this amendment on January 1, 2018 did not have a material impact on the Company’s consolidated financial statements.

In August 2016, the FASB issued new guidance to simplify elements of cash flow classification. The new guidance is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. The new guidance is effective for interim and annual periods beginning after December 15, 2017 and requires application of a retrospective transition method. Adoption of this guidance did not have a material impact on the Company’s consolidated financial statements.

~~Future Adoption of New Accounting Pronouncements~~

In February 2018, the FASB issued new guidance that will permit, but not require, entities to reclassify to retained earnings tax effects “stranded” in AOCI resulting from the change in federal tax rate enacted by the Tax Cuts and Jobs Act (the “Tax Reform Act”) on December 22, 2017. An entity that elects this option must reclassify these stranded tax effects for all items in AOCI, including, but not limited to, AFS securities and employee benefits. Tax effects stranded in AOCI for other reasons, such as prior changes in tax law, may not be reclassified. While the new guidance provides entities the option to reclassify these amounts, new disclosures are required regardless of whether entities elect to do

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

so. The new guidance is effective for interim and annual periods beginning after December 15, 2018, with early adoption permitted. Election can be made either to apply the new guidance retrospectively to each period in which the effect of the Tax Reform Act is recognized or in the period of adoption. Management currently is evaluating the options provided for adopting this guidance and the potential impacts on the Company’s consolidated financial statements.

In August 2017, the FASB issued new guidance on accounting for hedging activities, intended to more closely align the financial statement reporting of hedging relationships to the economic results of an entity’s risk management activities. In addition, the new guidance makes certain targeted modifications to simplify the application of current hedge accounting guidance. The new guidance is effective for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years, with early application permitted. The effect of adoption should be reflected as of the beginning of the fiscal year of adoption (that is, the initial application date). All transition requirements and elections should be applied to derivatives positions and hedging relationships existing on the date of adoption. Management currently is evaluating the impact that adoption of this guidance will have on the Company’s consolidated financial statements.

In March 2017, the FASB issued guidance that requires certain premiums on callable debt securities to be amortized to the earliest call date and is intended to better align interest income recognitionASU 2018-12, consistent with the ~~manner in which market participants price these instruments.~~ Division of Corporation Finance’s Financial Reporting Manual Section 11410.1.

The ~~new guidance is effective~~Company adopted ASU 2018-12 for ~~interim~~liability for future policy benefits (“LFPB”), additional insurance liabilities, DAC and ~~annual periods beginning after December 15, 2018~~balances amortized on a basis consistent with ~~early adoption permitted and is to be applied~~DAC on a modified retrospective basis. ~~Management currently is evaluating~~ASU 2018-12 was adopted for MRBs on a full retrospective basis.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

For the LFPB, the net transition adjustment has a favorable retained earnings impact ~~that adoption~~due to the exclusion of ~~this guidance will have~~DAC in loss recognition and Profits-followed-by-loss (“PFBL”) testing, resulting in a lower VISL PFBL liability. The unfavorable impact was offset by the removal of balances related to unrealized gains and losses on investments, any premium deficiency recorded in AOCI, formerly included in loss recognition testing as well as PFBL testing.

For market risk benefits, the ~~Company’s consolidated financial statements.~~

~~In June 2016, the FASB issued new guidance~~transition adjustment to AOCI related to the ~~accounting for~~effect of the changes in the instrument-specific credit ~~losses~~risk of market risk benefits between the contract issue and transition date. The remaining transition difference was related to recording market risk benefits at fair value. This change was recorded as an adjustment to retained earnings as of the transition date.

For DAC, and balances amortized on ~~financial instruments.~~ a basis consistent with DAC including sales inducement assets and unearned revenue liabilities, there is no retained earnings impact due to application of the modified transition approach. There is a favorable AOCI impact due to the removal of DAC balances recorded in AOCI, offsetting the unfavorable AOCI impact resulting from LFPB.

The ~~new guidance introduces an approach based on expected losses~~following table presents the effect of transition adjustment to ~~estimate credit losses on certain types of financial instruments. It also modifies~~total equity resulting from the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. The new guidance is effective for interim and annual periods beginning after December 15, 2019 with early adoption permitted for annual periods beginning after December 15, 2018. Management currently is evaluating the impact that adoption of ~~this guidance will have on~~ASU 2018-12 as of January 1, 2021:



	Retained Earnings		Accumulated Other Comprehensive Income		Total
	(in millions)
Liability for future policy benefits	$	30	$	(1,343)	$	(1,313)
Market risk benefits	(3,398)		(902)		(4,300)
DAC	—		1,548		1,548

Unearned revenue liability and sales inducement assets (1)	—		(166)		(166)

Total transition adjustment before taxes	(3,368)		(863)		(4,231)
Income taxes	707		181		888
Total transition adjustment (net of taxes)	$	(2,661)	$	(682)	$	(3,343)

_______________

(1)Unearned revenue liability included within liability for future policy benefits financial statement line item in the ~~Company’s~~ consolidated ~~financial statements.~~balance sheets. Sales inducement assets are included in other assets in the consolidated balance sheets.

~~In February 2016, the FASB issued revised guidance to lease accounting that will require lessees to recognize on~~The following table summarizes the balance ~~sheet a “right-of-use” asset~~of and ~~a lease~~changes in liability for virtually all lease arrangements, including those embedded in other contracts. The new lease accounting model will continue to distinguish between capital and operating leases. The current straight-line pattern forfuture policy benefits on January 1, 2021 resulting from the ~~recognition~~adoption of ~~rent expense on an operating lease is expected to remain substantially unchanged by the new guidance but instead will be comprised of amortization~~ASU 2018-12:


	Protection Solutions		Individual Retirement			Corporate & Other			Total
	Term			Payout			Group Pension				Health
	(in millions)
Balance, December 31, 2020	$	1,423		$	3,047		$	771	$	2,100	$	7,341
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	—			(171)			(85)		(100)		(356)


Effect of remeasurement of liability at current single A rate (1)	560			531			94		300		1,485
Balance, January 1, 2021 (1)	1,983			3,407			780		2,300		8,470
Less: Reinsurance recoverable	(59)			—			—		(1,837)		(1,896)
Balance, January 1, 2021, net of reinsurance	$	1,924		$	3,407		$	780	$	463	$	6,574

________________

(1)LFPB transition table not inclusive of the ~~right-of-use asset~~following transition adjustments to AOCI including Protection Solutions PFBL of $550 million, PDR of $(230) million, Rider Reserves and interest cost on the related lease obligation, thereby resulting in an income statement presentation similar to a financing arrangement or capital lease. Lessor accounting will remain substantially unchanged from the current model but has been updated to align with certain changes made to the lessee model. The new guidance is effective for fiscal years,Term Reinsurance of $(24) million and interim periods within those fiscal years, beginning after December 15, 2018, with early adoption permitted. The transition provisions require application on a modified retrospective approach at the beginningCorporate and Other of the earliest comparative period presented in the financial statements (that is, January 1, 2017). Extensive quantitative and qualitative disclosures, including significant judgments made by management, will be required to provide greater insight into the extent of revenue and expense recognized and expected to be recognized from existing lease contracts and arrangements. Management currently is evaluating the impact that adoption of this guidance will have on the Company’s consolidated financial statements.

~~Revenue Recognition~~

~~Investment Management and Service Fees and Related Expenses~~

Reported as Investment management and service fees in the Company’s consolidated statements of income (loss) are investment advisory and service fees, distribution revenues, and institutional research services revenues principally emerging from the Investment Management and Research segment. Also included are investment management and administrative service fees earned by AXA Equitable Funds Management Group, LLC (“AXA Equitable FMG”) and

$(111) million.

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~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

~~reported~~The following table summarizes the balance of and changes in the net liability position of market risk benefits on January 1, 2021 resulting from the adoption of ASU 2018-12:


	Individual Retirement		Legacy				Total
	GMxB Core		GMxB Legacy		Purchased MRB
	(in millions)
Balance, December 31, 2020	$	2,206	$	19,891	$	(2,572)	$	19,525
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	(4)		(70)		—		(74)
Adjustments for the cumulative effect of the changes in the instrument-specific credit risk between the original contract issuance date and the transition date (1)	505		461		2		968
Adjustments for the remaining difference (exclusive of the instrument specific credit risk change and host contract adjustments) between previous carrying amount and fair value measurement for the MRB (1)	(563)		4,122		(194)		3,365
Balance, January 1, 2021	$	2,144	$	24,404	$	(2,764)	$	23,784

_____________

(1)MRB transition table not inclusive of the following transition adjustments to retained earnings and AOCI including Individual Retirement EQUI-VEST of $43 million, SCS of $21 million, Protection Solutions of $(2) million and Group Retirement EQUI-VEST of $(20) million.

The following table summarizes the balance of and changes in DAC on January 1, 2021 resulting from the adoption of ASU 2018-12:


	Protection Solutions								Legacy		Individual Retirement								Group Retirement				Total
	Term		UL (1)		VUL (2)		IUL (3)		GMxB Legacy		GMxB Core		EI (4)		IE (5)		SCS		EG (6)		Momentum
	(in millions)
Balance, December 31, 2020	$	403	$	—	$	—	$	—	$	654	$	1,635	$	134	$	95	$	645	$	553	$	79	$	4,198
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	—		177		714		162		13		11		20		(1)		210		81		22		1,409
Balance, January 1, 2021 (7)	$	403	$	177	$	714	$	162	$	667	$	1,646	$	154	$	94	$	855	$	634	$	101	$	5,607

______________

(1) “UL” defined as Universal Life

(2) “VUL” defined as Variable Universal Life

(3) “IUL” defined as Indexed Universal Life

(4) “EI” defined as EQUI-VEST Individual

(5) “IE” defined as Investment Edge

(6) “EG” defined as EQUI-VEST Group

(7) DAC transition table not inclusive of Closed Block of $136 million and Protection ~~segments~~Solutions of $3 million transition adjustment.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The following tables summarizes the balance of and changes in sales inducement assets and unearned revenue liability on January 1, 2021 resulting from the adoption of ASU 2018-12:


	Sales Inducement Assets
	Legacy		Individual Retirement		Total
	GMxB Legacy		GMxB Core
	(in millions)
Balance, December 31, 2020	$	246	$	158	$	404
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	—		—		—
Balance, January 1, 2021	$	246	$	158	$	404


	Protection Solutions						Total
	Unearned Revenue Liability
	UL		VUL		IUL
	(in millions)
Balance, December 31, 2020	$	31	$	438	$	14	$	483
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	29		127		9		165
Balance, January 1, 2021	$	60	$	565	$	23	$	648

DAC

Acquisition costs that vary with and are primarily related to the acquisition of new and renewal insurance business, reflecting incremental direct costs of contract acquisition with independent third parties or employees that are essential to the contract transaction, as well as ~~certain asset-based fees~~the portion of employee compensation, including employee fringe benefits and other costs directly related to underwriting, policy issuance and processing, medical inspection, and contract selling for successfully negotiated contracts including commissions, underwriting, agency and policy issue expenses, are deferred.

Contracts are measured on a grouped basis utilizing cohorts consistent with those used in the calculation of future policy benefit reserves. DAC is amortized on a constant level basis for the grouped contracts over the expected term of the contract. For life insurance products, DAC is amortized in proportion to the face amount in force. For annuity products, DAC is amortized in proportion to policy counts. The constant level basis used for amortization determines the current period amortization considering both the current period’s actual experience and future projections. The amortization pattern is revised quarterly on a prospective basis. Amortization of DAC is included in amortization of DAC, part of total benefits and other deductions.

For some products, policyholders can elect to modify product benefits, features, rights, or coverages that occur by the exchange of a contract for a new contract, or by amendment, endorsement, or rider to a contract, or by election or coverage within a contract. These transactions are known as internal replacements. If such modification substantially changes the contract, the associated DAC is written off immediately through income and any new acquisition costs associated with the replacement contract are deferred.

Amount due to and from Reinsurers

For each of its reinsurance agreements, the Company determines whether the agreement provides indemnification against loss or liability relating to insurance ~~contracts.~~risk in accordance with applicable accounting standards. Cessions under reinsurance agreements do not discharge the Company’s obligations as the primary insurer. The Company reviews all contractual features, including those that may limit the amount of insurance risk to which the reinsurer is subject or features that delay the timely reimbursement of claims.

~~Investment management, advisory,~~For reinsurance of existing in-force blocks of long-duration contracts that transfer significant insurance risk, the difference, if any, between the amounts paid (received), and ~~service fees~~

~~AB provides asset management services by managing customer assets and seeking~~the liabilities ceded (assumed) related to deliver returns to investors. Similarly, AXA Equitable FMG provides investment management and administrative services, such as fund accounting and compliance services, to AXA Premier VIP Trust (“VIP Trust”), EQ Advisors Trust (“EQAT”) and 1290 Fundsthe underlying contracts is considered the net cost of reinsurance at the inception of the reinsurance agreement. Subsequent amounts paid (received) on the reinsurance of in-force blocks, as well as ~~two private investment trusts~~amounts paid (received) related to new business, are recorded as premiums ceded (assumed); and amounts due from reinsurers (amounts due to reinsurers) are established.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Assets and liabilities relating to reinsurance agreements with the same reinsurer may be recorded net on the consolidated balance sheets if a right of offset exists within the reinsurance agreement. In the event that reinsurers do not meet their obligations to the Company under the terms of the reinsurance agreements, reinsurance recoverable balances could become uncollectible. In such instances, reinsurance recoverable balances are stated net of allowances for uncollectible reinsurance.

Premiums, policy charges and fee income, and policyholders’ benefits include amounts assumed under reinsurance agreements and are net of reinsurance ceded. Amounts received from reinsurers for policy administration are reported in other revenues.

For reinsurance contracts, reinsurance recoverable balances are generally calculated using methodologies and assumptions that are consistent with those used to calculate the direct liabilities.

Ceded reinsurance transactions are recognized and measured in a manner consistent with underlying reinsured contracts, including using consistent assumptions. Assumed and ceded reinsurance contract rights and obligations are accounted for on a basis consistent with our direct contract. The reinsurance cost or benefit for traditional life non-participating and limited-payment contracts is recognized in proportion to the gross premiums of the underlying direct cohorts. The locked-in single A discount rate used to calculate the reinsurance cost or benefit is established at inception of the reinsurance contract. Changes to the single A discount rate are reflected in comprehensive income at each reporting date.

If the Company determines that a reinsurance agreement does not expose the reinsurer to a reasonable possibility of a significant loss from insurance risk, the Company records the agreement using the deposit method of accounting. Deposits received are included in other liabilities and deposits made are included within other assets. As amounts are paid or received, consistent with the underlying contracts, the deposit assets or liabilities are adjusted. Interest on such deposits is recorded as other income or other operating costs and expenses, as appropriate.

Sales Inducement Assets

Sales inducement assets are offered on certain deferred annuity products in the Cayman Islands, AXA Allocation Funds Trust and AXA Offshore Multimanager Funds Trust (collectively, the “Other AXA Trusts”). The contracts supporting these revenue streams create a distinct, separately identifiable performance obligation for each day the assets are managed for the performanceform of a series of services that are substantially the same and have the same pattern of transfer to the customer. Accordingly, these investment management, advisory, and administrative service base fees are recorded over time as services are performed and entitle the Company to variable consideration. Base fees, generally calculated as a percentage of assets under management (“AUM”), are recognized as revenue at month-end when the transaction price no longer is variable and the value of the consideration is determined. These fees are not subject to claw back and there is minimal probability that a significant reversal of the revenue recorded will occur.

~~Certain investment advisory contracts of AB, including those associated with hedge funds~~either immediate bonus interest credited or ~~other alternative investments, provide~~enhanced interest crediting rates for a performance-based fee (including carried interest), in addition to a base advisory fee, calculated either as a percentage of absolute investment results or a percentage of investment results in excess of a stated benchmark over a specified period of time. These performance-based fees are forms of variable consideration and, therefore, are excluded from the transaction price until it becomes probable there will not be significant reversal of the cumulative revenue recognized. At each reporting date, the Company evaluates constraining factors surrounding the variable consideration to determine the extent to which, if any, revenues associated with the performance-based fee can be recognized. Constraining factors impacting the amount of variable consideration included in the transaction price include contractual claw-back provisions, the length of time of the uncertainty, the number and range of possible amounts, the probability of significant fluctuations in fund’s market value, and the level in which the fund’s value exceeds the contractual threshold required to earn such a fee and the materiality of the amount being evaluated. Prior to adoption of the new revenue recognition guidance on January 1, 2018, the Company recognized performance-based fees at the end of the applicable measurement period when no risk of reversal remained, and carried-interest distributions received as deferred revenues until no risk of reversal remained.

~~Sub-advisory and sub-administrative expenses~~The interest crediting expense associated with these ~~services~~sales inducement assets is deferred and amortized over the lives of the underlying contracts in a manner consistent with the amortization of DAC. Unamortized balances are ~~calculated and recorded as the related services are performed~~included in ~~Other operating costs and expense~~other assets in the consolidated ~~statements of income (loss) as the Company~~balance sheets and amortization is ~~acting~~included in ~~a principal capacity in these transactions and, as such, reflects these revenues and expenses on a gross basis.~~

~~Research services~~

Research services revenue principally consists of brokerage transaction charges received by Sanford C. Bernstein & Co. LLC (“SCB LLC”) and Sanford C. Bernstein Limited (“SCBL”) for providing equity research servicesinterest credited to institutional clients. Brokerage commissions for trade execution services and related expenses are recorded on a trade-date basis when the performance obligations are satisfied. Generally, the transaction price is agreed upon at the point of each trade and based upon the number of shares traded or the value of the consideration traded. Research revenues are recognized when the transaction price is quantified, collectability is assured, and significant reversal of such revenue is not probable.

~~Distribution services~~

Revenues from distribution services include fees received as partial reimbursement of expenses incurred in connection with the sale of certain AB sponsored mutual funds and the 1290 Funds and for the distribution primarily of EQAT and VIP Trust shares to separate accounts in connection with the sale of variable life and annuity contracts. The amount

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~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

and timing of revenues recognized from performance of these distribution services often is dependent upon the contractual arrangements with the customer and the specific product sold as further described below.

Most open-end management investment companies, such as U.S. funds and the EQAT and VIP Trusts and the 1290 Funds, have adopted a plan under Rule 12b-1 of the Investment Company Act that allows for certain share classes to pay out of assets, distribution and service fees for the distribution and sale of its shares (“12b-1 Fees”). These open-end management investment companies have such agreements with the Company, and the Company has selling and distribution agreements pursuant to which it pays sales commissions to the financial intermediaries that distribute the shares. These agreements may be terminated by either party upon notice (generally 30 days) and do not obligate the financial intermediary to sell any specific amount of shares.

The Company records 12b-1 fees monthly based upon a percentage of the net asset value (“NAV”) of the funds. At month-end, the variable consideration of the transaction price is no longer constrained as the NAV can be calculated and the value of consideration is determined. These services are separate and distinct from other asset management services as the customer can benefit from these services independently of other services. The Company accrues the corresponding 12b-1 fees paid to sub-distributors monthly as the expenses are incurred. The Company is acting in a principal capacity in these transactions; as such, these revenues and expenses are recorded on a gross basispolicyholders’ account balances in the consolidated statements of income (loss).

~~AB sponsored mutual funds offer back-end load shares~~Policyholders’ Account Balances

Policyholders’ account balances relate to contracts or contract features where the Company has no significant insurance risk. This liability represents the contract value that has accrued to the benefit of the policyholder as of the balance sheet date.

Obligations arising from funding agreements are also reported in ~~limited instances~~policyholders’ account balances in the consolidated balance sheets. As a member of the FHLB, the Company has access to collateralized borrowings. The Company may also issue funding agreements to the FHLB. Both the collateralized borrowings and ~~charge~~funding agreements would require the ~~investor a contingent deferred sales charge (“CDSC”) if the investment~~Company to pledge qualified mortgage-backed assets and/or government securities as collateral.

Future Policy Benefits and Other Policyholders’ Liabilities

The liability for future policy benefits is ~~redeemed within a certain period. The variable consideration for these contracts is contingent~~estimated based upon the ~~timing~~present value of future policy benefits and related claim expenses less the present value of estimated future net premiums where net premium equals gross premium under the contract multiplied by the net premium ratio. Related claim expenses include termination and settlement costs and exclude acquisition costs and non-claim related costs. The liability is estimated using current assumptions that include discount rate, mortality, lapses, and expenses. Assumptions are based on judgments that consider the Company’s historical experience, industry data, and other factors.

For participating traditional life insurance policies, future policy benefit liabilities are calculated using a net level premium method based on guaranteed mortality and dividend fund interest rates. The liability for annual dividends represents the accrual of annual dividends earned. Terminal dividends are accrued in proportion to face amount over the life of the ~~redemption~~contract.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

For non-participating traditional life insurance policies (Term) and limited pay contracts (Payout, Pension), contracts are grouped into cohorts by contract type and issue year. Quarterly, the ~~investor~~Company updates its estimate of cash flows using actual experience and current future cash flow assumptions, which is reflected in an updated net premium ratio used to calculate the liability. The ratio of actual and future expected claims to actual and future expected premiums determines the net premium ratio. The policy administration expense assumption is not updated after policy issuance. If actual expenses differ from the original expense assumptions, the differences are recognized in the period identified. The revised net premium ratio is used to determine the updated liability for future policy benefits as of the beginning of the reporting period, discounted at the original contract issuance rate. Changes in the liability due to current discount rates differing from original rates are included in other comprehensive income within the consolidated statement of comprehensive income.

For non-participating traditional life insurance policies and limited pay contracts, the discount rate assumption used is corporate A rated forward curve. We use a forward curve based upon a Bloomberg index. The liability is remeasured each quarter with the remeasurement change reported in other comprehensive income. The locked-in discount rate is generally based on expected investment returns at contract inception for contracts issued prior to January 1, 2021 and the ~~value~~upper medium grade fixed income corporate instrument yield (i.e., single A) at contract inception for contracts issued after January 1, 2021. The Company developed an LDTI discount rate methodology used to calculate the LFPB for its traditional insurance liabilities and constructed a discount rate curve that references upper-medium grade (low credit risk) fixed-income instrument yields (i.e. single A rated Corporate bond yields) which are meant to reflect the duration characteristics of the ~~sales proceeds. Due to these constraining factors, the Company excludes the CDSC fee from the transaction price until the investor redeems the investment. Upon redemption, the cash consideration~~corresponding insurance liabilities. The methodology uses observable market data, where available, and uses various estimation techniques in line with fair value guidance (such as interpolation and extrapolation) where data is limited. Discount rates are updated quarterly.

For limited-payment products, gross premiums received ~~for these contractual arrangements is recorded~~in excess of net premiums are deferred at initial recognition as a ~~reduction~~deferred profit liability (“DPL”). DPL will be amortized in relation to the expected future benefit payments. As the calculation of ~~unamortized deferred sales commissions.~~

~~AB’s Luxembourg subsidiary,~~ the ~~management company for most of its non-U.S. funds, earns a management fee which~~DPL is ~~accrued daily and paid monthly, at an annual rate,~~ based on the average daily net assets of the fund. With respect to certain share classes, the management fee also may contain a component paid to distributors and other financial intermediaries and service providers to cover shareholder servicing and other administrative expenses (also referred to as an “All-in-Fee”). Baseddiscounted cash flows, interest accrues on the ~~conclusion that asset management~~unamortized DPL balance using the discount rate determined at contract issuance. The DPL is ~~distinct from distribution,~~updated at the ~~Company allocates a portion of~~same time as the ~~investment and advisory fee to distribution revenues~~estimates for cash flows for the ~~servicing component based on standalone selling prices.~~

~~Other revenues~~

~~Also reported as Investment management~~liability for future policy benefits. Any difference between the recalculated and ~~service fees~~beginning of period DPL is recognized in remeasurement gain or loss in the ~~Company’s~~ consolidated statements of income (loss) ~~are other revenues from contracts with customers, primarily consisting~~, remeasurement of ~~shareholder servicing fees, mutual fund reimbursements,~~liability for future policy benefits, part of total benefits and other ~~brokerage income.~~deductions. On the consolidated balance sheets, the DPL is recorded in the liability for future policy benefits.

~~Shareholder services, including transfer agency, administration,~~Additional liabilities for contract or contract features that provide for additional benefits in addition to the account balance but are not market risk benefits or embedded derivatives (“additional insurance liabilities”) are established by estimating the expected value of death or other insurance benefits in excess of the projected contract accumulation value and ~~record-keeping~~recognizing the excess over the estimated life based on expected assessments (i.e., benefit ratio). The liability equals the current benefit ratio multiplied by cumulative assessments recognized to date, plus interest, less cumulative excess payments to date. These reserves are ~~provided by AB to company-sponsored mutual funds.~~recorded within future policy benefits and other policyholders’ liabilities. The ~~consideration for these services~~determination of this estimated future policy benefits liability is based on models that involve numerous assumptions and subjective judgments, including those regarding expected market rates of return and volatility, contract surrender and withdrawal rates, and mortality experience. There can be no assurance that actual experience will be consistent with management’s estimates. Assumptions are reviewed annually and updated with the remeasurement gain or loss reflected in total benefit expense.

The Company recognizes an adjustment in other comprehensive income for the additional insurance liabilities for unrealized gains and losses not included when calculating the present value of expected assessments for the benefit ratios.

The Company conducts annual premium deficiency testing except for liability for future policy benefits for non- participating traditional and limited payment contracts. The Company reviews assumptions and determines whether the sum of existing liabilities and the present value of future gross premiums is sufficient to cover the present value of future benefits to be paid and settlement costs. Anticipated investment income is considered when performing premium deficiency for long duration contracts. The anticipated investment income is projected based on current investment portfolio returns grading to long term reinvestment rates over the projection periods, based on anticipated gross reinvestment spreads, defaults and investment expenses. Premium deficiency reserves are recorded in certain instances where the policyholder liability for a ~~percentage~~particular line of business may not be deficient in the aggregate to trigger loss recognition, but the pattern of earnings may be such that profits are expected to be recognized in earlier years followed by losses in later years. This pattern of profits followed by losses is exhibited in our VISL business and is generated by the cost structure of the ~~NAV~~product or secondary guarantees in the contract. The secondary guarantee

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

ensures that, subject to specified conditions, the ~~fund~~policy will not terminate and will continue to provide a death benefit even if there is insufficient policy value to cover the monthly deductions and charges. We accrue for these PFBL using a dynamic approach that changes over time as the projection of future losses change.

Market Risk Benefits

Market risk benefits (“MRBs”) are contracts or contract features that provide protection to the contract holder from other than nominal capital market risk and expose the Company to other than nominal capital market risk. Market risk benefits include contract features that provide minimum guarantees to policyholders and include GMIB, GMDB, GMWB, GMAB, and ROP DB benefits. MRBs are measured at fair value on a ~~fixed-fee~~seriatim basis using an ascribed fee approach based upon policyholder behavior projections and risk neutral economic scenarios adjusted based on the ~~number~~facts and circumstances of ~~shareholder accounts being serviced.~~the Company’s product features. The ~~revenues~~MRB asset and MRB liability will be equal to the average present value of benefits and risk margins less the average present value of ascribed fees. Ascribed fees will consist of the fee needed, under a stochastically generated set of risk-neutral scenarios, so that the mean present value of claims, including any risk charge, is equal to the mean present value of the projected attributed fees which will be capped at average present value of total policyholder contractual fees. The attributed fee percentage is considered a fixed term of the MRB feature and is held static over the life of the contract. Changes in fair value are ~~recorded at month-end when the constraining factors involved with determining NAV or the numbers of shareholders’ accounts are resolved.~~

~~Other income~~

~~Revenues from contracts with customers reported~~recognized as ~~Other income~~a remeasurement gain/loss in the change in market risk benefits and purchased market risk benefits, part of total benefits and other deductions except for the portion of the change in the fair value due to a change in the Company’s own credit risk, which is recognized in other than comprehensive income. Additionally, when an annuitization occurs (for annuitization benefits) or upon extinguishment of the account balance (for withdrawal benefits) the balance related to the MRB will be derecognized and the amount deducted (after derecognition of any related amount included in accumulated other comprehensive income) shall be used in the calculation of the liability for future policy benefits for the payout annuity. Upon derecognition, any related balance will be removed from AOCI.

The Company has issued and continues to offer certain variable annuity products with GMDB and/or contain a GMLB (collectively, the “GMxB features”) which, if elected by the policyholder after a stipulated waiting period from contract issuance, guarantees a minimum lifetime annuity based on predetermined annuity purchase rates that may be in excess of what the contract account value can purchase at then-current annuity purchase rates. This minimum lifetime annuity is based on predetermined annuity purchase rates applied to a GMIB base. The Company previously issued certain variable annuity products with GMIB, GWBL, GMWB, and GMAB features. The Company has also assumed reinsurance for products with GMxB features.

Features in ceded reinsurance contracts that meet the definition of MRBs are accounted for at fair value as a purchased MRB. The fees used to determine the fair value of the reinsured market risk benefit are those defined in the reinsurance contract. The expected periodic future premiums would represent cash outflows and the expected future benefits would represent cash inflows in the fair value calculation. On the ceded side, the purchased MRB is measured considering the counterparty credit risk of the reinsurer, while the direct contract liabilities is measured considering the instrument-specific credit risk of the insurer. As a result of the difference in the treatment of the counterparty credit risk, the fair value of the direct and ceded contracts may be different even if the contractual fees and benefits are the same. Changes in instrument-specific credit risk of the Company is included in the fair value of its market risk benefit, whether in an asset or liability position, and whether related to an issued or purchased MRB, is recognized in OCI. The counterparty credit risk of the reinsurer is recorded in the consolidated statements of income (loss) ~~primarily consist~~.

Troubled Debt Restructuring

The Company invests in commercial, agricultural and residential mortgage loans included in the consolidated balance sheets as mortgage loans on real estate. Under certain circumstances, modifications are granted to these contracts. Each modification is evaluated as to whether a TDR has occurred. A modification is a TDR when the borrower is in financial difficulty. The types of ~~advisory account fees~~modifications made may include reducing the face amount or maturity amount of the debt as originally stated, reducing the contractual interest rate, extending the maturity date at an interest rate lower than current market interest rates and/or reducing accrued interest. The credit allowance is an estimate of lifetime expected losses reflecting historical loss information which included losses from modification to a borrower experiencing financial difficulty. As the effect of the modification made to a borrower experiencing financial difficulty is already included in the credit allowance, the carrying value (net of the allowance) before and ~~brokerage commissions from~~after modification through a TDR may not change significantly, or may increase if the ~~Company’s subsidiary broker-dealer operations and sales commissions from~~expected recovery is higher than the ~~Company’s general agent for~~pre-modification recovery assessment. For information pertaining to our TDRs see Note 3 of the distribution of non-affiliate insurers’ life insurance and annuity products. These revenues are recognized at month-end when constraining factors, such as AUM and product mix, are resolved and the transaction pricing no longer is variable such that the value of consideration can be determined.

Notes to these Consolidated Financial Statements.

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~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

~~Contract assets and liabilities~~Securities Lending Program

The Company ~~applies~~enters into securities lending transactions whereby securities are loaned to third parties, primarily major brokerage firms. Securities lending transactions are treated as financing arrangements and the ~~practical expedient for contracts that have an original duration~~associated liability is recorded as the amount of ~~one year or less. Accordingly,~~cash received. Income and expenses associated with securities lending transactions are reported within net investment income in the ~~Company accrues the incremental costs~~consolidated statements of obtaining a contract when incurred and does not consider the time value of money. At March 31, 2018, there are no material balances of contract assets and contract liabilities; as such, no further disclosures are necessary.income (loss).

Accounting and Consolidation of VIEs

~~A VIE must be consolidated~~For all new investment products and entities developed by ~~its primary beneficiary, which generally~~the Company, the Company first determines whether the entity is ~~defined as the party that has a controlling financial interest in the VIE. The Company is deemed to have a controlling financial interest in~~ a VIE, ~~if it has (i)~~which involves determining an entity’s variability and variable interests, identifying the ~~power to direct the activities~~holders of the ~~VIE that most significantly affect~~equity investment at risk and assessing the ~~VIE’s economic performance, and (ii) the obligation to absorb losses~~five characteristics of ~~the VIE or the right to receive income from the VIE that potentially could be significant to the~~a VIE. For purposes of evaluating (ii) above, fees paid to the Company as a decision maker or service provider are excluded if the fees are compensation for services provided commensurate with the level of effort required to be performed and the arrangement includes only customary terms, conditions or amounts present in arrangements for similar services negotiated at arm’s length.

~~If the Company has a variable interest in~~Once an entity ~~that~~ is determined ~~not~~ to be a VIE, the ~~entity~~Company then determines whether it is ~~evaluated for consolidation under~~ the ~~voting interest entity (“VOE”) model. For limited partnerships and similar entities,~~primary beneficiary of the VIE based on its beneficial interests. If the Company is deemed to ~~have a controlling~~be the primary beneficiary of the VIE, the Company consolidates the entity.

Quarterly, management of the Company reviews its investment management agreements and its investments in, and other financial ~~interest in a VOE, and would be~~arrangements with, certain entities that hold client AUM to determine the entities the Company is required to consolidate ~~the entity, if the Company owns a majority of the entity’s kick-out rights through voting~~under this guidance. These entities include certain mutual fund products, hedge funds, structured products, group trusts, collective investment trusts, and limited partnership interests and other limited partners do not hold substantive participating rights (or other rights that would indicate that the Company does not control the entity). For entities other than limited partnerships, the Company is deemed to have a controlling financial interest in a VOE if it owns a majority voting interest in the entity.partnerships.

The analysis performed to identify variable interests held, determine whether entities are VIEs or VOEs, and evaluate whether the Company has a controlling financial interest in such entities requires the exercise of judgment and is updated on a continuous basis as circumstances change or new entities are developed. The primary beneficiary evaluation generally is performed qualitatively based on all facts and circumstances, including consideration of economic interests in the VIE held directly and indirectly through related parties and entities under common control, as well as quantitatively, as appropriate.

~~At March~~Consolidated VIEs

Consolidated CLOs

The Company is the investment manager of certain asset-backed investment vehicles, commonly referred to as CLOs, and certain other vehicles for which the Company earns fee income for investment management services. The Company may sell or syndicate investments through these vehicles, principally as part of the strategic investing activity as part of its investment management businesses. Additionally, the Company may invest in securities issued by these vehicles which are eliminated in consolidation of the CLOs.

As of September 30, 2023 and December 31, ~~2018,~~2022, respectively, Equitable Financial holds $113 million and $85 million of equity interests in the CLOs. The Company consolidated the CLOs as of September 30, 2023 and December 31, 2022 as it is the primary beneficiary due to the combination of both its equity interest held by Equitable Financial and the majority ownership of AB, which functions as the CLOs loan manager. The assets of the CLOs are legally isolated from the Company’s creditors and can only be used to settle obligations of the CLOs. The liabilities of the CLOs are non-recourse to the Company and the Company has no obligation to satisfy the liabilities of the CLOs. As of September 30, 2023, Equitable Financial holds $22 million of equity interests in a SPE established to purchase loans from the market in anticipation of a new CLO transaction. The Company consolidated the SPE as of September 30, 2023 as it is the primary beneficiary due to the combination of both its equity interest held by Equitable Financial and the majority ownership of AB, which functions as the SPE loan manager.

Resulting from this consolidation in the Company’s consolidated balance sheets are fixed maturities, at fair value using the fair value option with total assets of $1.6 billion and $1.5 billion notes issued by consolidated variable interest entities, at fair value using the fair value option with total liabilities of $1.5 billion and $1.2 billion at September 30, 2023 and December 31, 2022, respectively. The unpaid outstanding principal balance of the notes and short-term borrowing is $1.6 billion and $1.4 billion at September 30, 2023 and December 31, 2022.

Consolidated Limited Partnerships and LLCs

As of September 30, 2023 and December 31, 2022 the Company consolidated limited partnerships and LLCs for which it was identified as the primary beneficiary under the VIE model. Included in other invested assets, mortgage loans on real estate, other equity investments, trading securities, cash and other liabilities in the Company’s consolidated balance sheets at September 30, 2023 and December 31, 2022 are total net assets of $1.4 billion and $644 million, respectively related to these VIEs.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Consolidated AB-Sponsored Investment Funds

Included in the Company’s consolidated balance sheets as of September 30, 2023 and December 31, 2022 are assets of $324 million and $581 million, liabilities of $13 million and $56 million, and redeemable noncontrolling interests of $176 million and $369 million, respectively, associated with the consolidation of AB-sponsored investment funds under the VIE model. Also included in the Company’s consolidated balance sheets as of September 30, 2023 and December 31, 2022 are assets of $23 million and $0 million, liabilities of $1 million and $0 million, and redeemable noncontrolling interests of $7 million and $0 million, respectively, from consolidation of AB-sponsored investment funds under the VOE model.

Non-Consolidated VIEs

As of September 30, 2023 and December 31, 2022 respectively, the Company held approximately ~~$1,137 million~~$2.5 billion and $2.4 billion of investment assets in the form of equity interests issued by non-corporate legal entities determined under the ~~new~~ guidance to be VIEs, such as limited partnerships and limited liability companies, including CLOs, hedge funds, private equity funds and real estate-related funds. As an equity investor, the Company is considered to have a variable interest in each of these VIEs as a result of its participation in the risks and/or rewards these funds were designed to create by their defined portfolio objectives and strategies. Primarily through qualitative assessment, including consideration of related party interests or other financial arrangements, if any, the Company was not identified as primary beneficiary of any of these VIEs, largely due to its inability to direct the activities that most significantly impact their economic performance. Consequently, theThe Company continues to reflect these equity interests in the consolidated balance ~~sheet~~sheets as ~~Other~~other equity investments and ~~to apply~~applies the equity method of accounting for these positions. The net assets of these non-consolidated VIEs are approximately ~~$163,434 million,~~$265.2 billion and ~~the~~$282.5 billion as of September 30, 2023 and December 31, 2022 respectively. The Company’s maximum exposure to loss from its direct involvement with these VIEs is the carrying value of its investment of ~~$1,137 million at March 31, 2018. Except for~~$2.5 billion and $2.4 billion and approximately ~~$798 million~~$1.3 billion and $1.3 billion of unfunded commitments ~~at March~~as of September 30, 2023 and December 31, ~~2018, the~~2022, respectively. The Company has no further economic interest in these VIEs in the form of guarantees, derivatives, credit enhancements or similar instruments and obligations.

At March 31, 2018, the Company consolidated one real estate joint venture for which it was identified as primary beneficiary under the VIE model. The consolidated entity is jointly owned by AXA Equitable Life Insurance Company (“AXA Equitable Life”) and AXA France and holds an investment in a real estate venture. Included in the Company’s consolidated balance sheet at March 31, 2018, are total assets of $36 million related to this VIE, primarily resulting from the consolidated presentation of $36 million of real estate held for production of income. In addition, real estate held for production of income reflects $16 million as related to two non-consolidated joint ventures at March 31, 2018.

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

Included in the Company’s consolidated balance sheet at March 31, 2018 are assets of $2,447 million, liabilities of $1,219 million and redeemable non-controlling interest of $982 million associated with the consolidation of AB-sponsored investment funds under the VIE model. Also included in the Company’s consolidated balance sheets are assets of $135 million, liabilities of $4 million and redeemable non-controlling interest of $10 million from consolidation of AB-sponsored investment funds under the VOE model. The assets of these consolidated funds are presented within Other invested assets and cash and cash equivalents, and liabilities of these consolidated funds are presented with other liabilities on the face of the Company’s consolidated balance sheet at March 31, 2018; ownership interests not held by the Company relating to consolidated VIEs and VOEs are presented either as redeemable or non-redeemable noncontrolling interest, as appropriate. The Company is not required to provide financial support to these company-sponsored investment funds, and only the assets of such funds are available to settle each fund’s own liabilities.Non-Consolidated AB-Sponsored Investment Products

As of ~~March~~September 30, 2023 and December 31, ~~2018,~~2022, the net assets of investment products sponsored by AB that are ~~nonconsolidated~~non-consolidated VIEs are approximately ~~$83.9~~$54.9 billion and ~~the~~$46.4 billion, respectively. The Company’s maximum exposure to loss from its direct involvement with these VIEs is its investment of $8$11 million ~~at March~~and $6 million as of September 30, 2023 and December 31, ~~2018.~~2022. The Company has no further commitments to or economic interest in these VIEs.

~~Impact of the Tax Reform Act~~

On December 22, 2017, President Trump signed into law the Tax Reform Act, a broad overhaul of the U.S. Internal Revenue Code that changes long-standing provisions governing the taxation of U.S. corporations, including life insurance companies.

The Tax Reform Act reduces the federal corporate income tax rate to 21% beginning in 2018 and repeals the corporate alternative minimum tax (“AMT”) while keeping existing AMT credits. It also includes changes to the dividends received deduction (“DRD”), insurance reserves and tax DAC, and measures affecting our international operations, such as a one-time transitional tax on some of the accumulated earnings of our foreign subsidiaries (within our Investment Management and Research segment).

~~As a result of the Tax Reform Act, our new effective tax rate is expected to be approximately 19%, driven mainly by the new federal corporate tax rate of 21% and the DRD benefit.~~

We expect the Tax Reform Act to have both positive and negative impacts on our consolidated balance sheet. On the one hand, as a one-time effect, the lower tax rate resulted in a reduction to the value of our deferred tax assets. On the other hand, the Tax Reform Act repeals the corporate AMT and, subject to certain limitations, allows us to use our AMT credits going forward, which will result in a reduction of our tax liability.

We expect the tax liability on the earnings of our foreign subsidiaries will decrease going forward. In 2017, we recorded a one-time estimated decrease to net income of $23 million due to the estimated transitional tax on some of the accumulated earnings of these subsidiaries.

Overall, we expect the Tax Reform Act to have a net positive economic impact on us. At December 31, 2017, we recorded a provisional estimate of the income tax effects related to Tax Reform. During the period ended March 31, 2018, we have not recorded any changes to this estimate. We continue to evaluate this new and complicated piece of legislation, assess the magnitude of the various impacts and monitor potential regulatory changes related to this reform.

Assumption Updates and Model Changes

~~There were no~~The Company conducts its annual review of its assumptions and models during the third quarter of each year. The annual review encompasses assumptions underlying the valuation of MRB, liabilities for future policyholder benefits and Additional Liability Update.

However, the Company updates its assumptions as needed in the event it becomes aware of economic conditions or events that could require a change in assumptions that it believes may have a significant impact to the carrying value of product liabilities and assets and consequently materially impact its earnings in the period of the change.

MRB Update

The Company updates its assumptions to reflect emerging experience for withdrawals, mortality and lapse election. This includes actuarial judgement informed by actual experience of how policy holders are expected to use these policies in the future.

LFPB Update

The significant assumptions for the LFPB balances include mortality and lapses for our Traditional life businesses. The primary assumption for the payout block of business is mortality.

Additional Liability Update

The significant assumptions for the additional insurance liability balances include mortality, lapses, premium payment pattern, and interest crediting assumption.

Impact of Assumption Updates

The net impact of assumption changes induring the ~~first quarters of 2018 or 2017.~~

~~Revision of Prior Period Financial Statements~~

~~During the first quarter of 2018, management identified an error in its previously issued financial statements related to a misclassification between interest credited~~three and ~~net derivative gains/losses. The impact of this error to the consolidated financial statements for the six months ended June 30, 2017,~~ nine months ended September 30, ~~2017 and the years ended December 31, 2017 and 2016 was not considered to be material. In order to improve the consistency and~~

2023 decreased other income by $9 million, increased remeasurement of liability for future policy benefits by $51 million, decreased policy

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~comparability of the financial statements, management revised the consolidated statements of income (loss) and statements of cash flows to include the revisions discussed herein. See Note 17 to the~~ Notes to Consolidated Financial Statements (Unaudited), Continued

benefits by $2 million, and decreased the change in market risk benefits and purchased market risk benefits by $53 million. This resulted in a decrease in income (loss) from operations, before income taxes of $5 million and decreased net income (loss) by $4 million.

The net impact of this assumption update during the three and nine months ended September 30, 2022 increased remeasurement of liability for ~~details~~future policy benefits by $14 million, decreased policyholders’ benefits by $13 million, increased change in market risk benefits and purchased market risk benefits by $204 million and increased interest credited to policyholder’s account balances by $1 million. This resulted in a decrease in income (loss) from operations, before income taxes of $206 million and decreased net income (loss) by $163 million.

Model Changes

There were no material model changes in the ~~revisions.~~first nine months of 2023 and 2022.

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

3) INVESTMENTS

Fixed Maturities AFS

The components of fair value and amortized cost for fixed maturities classified as AFS on the consolidated balance sheets excludes accrued interest receivable because the Company elected to present accrued interest receivable within other assets. Accrued interest receivable on AFS fixed maturities as of September 30, 2023 and December 31, 2022 was $654 million and $591 million, respectively. There was no accrued interest written off for AFS fixed maturities for the three and nine months ended September 30, 2023 and 2022.

The following ~~table provides~~tables provide information relating to the Company’s fixed maturities ~~securities~~ classified as AFS:

~~Available-for-Sale Securities~~AFS Fixed Maturities by Classification

Amortized
Cost Gross Unrealized
Gains Gross Unrealized
Losses Fair
Value
OTTI
in AOCI ⁽³⁾
(in millions)
March 31, 2018:
Fixed Maturity Securities:
Public corporate $ 18,513
$ 501
$ 298
$ 18,716
$ —
Private corporate 7,394
117
107
7,404
—
U.S. Treasury, government and agency 14,772
387
506
14,653
—
States and political subdivisions 422
56
1
477
—
Foreign governments 405
23
9
419
—
Residential mortgage-backed⁽¹⁾
614
16
3
627
—
Asset-backed⁽²⁾
675
4
4
675
2
Redeemable preferred stock 473
44
4
513
—
Total at March 31, 2018 $ 43,268
$ 1,148
$ 932
$ 43,484
$ 2


	Amortized Cost		Allowance for Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in millions)
September 30, 2023
Fixed Maturities:
Corporate (1)	$	50,800	$	2	$	58	$	8,082	$	42,774
U.S. Treasury, government and agency	5,744		—		—		1,573		4,171
States and political subdivisions	615		—		2		102		515
Foreign governments	821		—		1		161		661
Residential mortgage-backed (2)	1,791		—		—		136		1,655
Asset-backed (3)	10,477		—		15		212		10,280
Commercial mortgage-backed	4,051		—		—		680		3,371
Redeemable preferred stock	41		—		2		—		43
Total at September 30, 2023	$	74,340	$	2	$	78	$	10,946	$	63,470

December 31, 2022:
Fixed Maturities:
Corporate (1)	$	50,712	$	24	$	89	$	7,206	$	43,571
U.S. Treasury, government and agency	7,054		—		1		1,218		5,837
States and political subdivisions	609		—		7		89		527
Foreign governments	985		—		2		151		836
Residential mortgage-backed (2)	908		—		1		87		822
Asset-backed (3)	8,859		—		4		373		8,490
Commercial mortgage-backed	3,823		—		—		588		3,235
Redeemable preferred stock	41		—		2		—		43
Total at December 31, 2022	$	72,991	$	24	$	106	$	9,712	$	63,361

______________

(1)Corporate fixed maturities include both public and private issues.

~~Table of Contents~~(2)Includes publicly traded agency pass-through securities and collateralized obligations.

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~As a result of the adoption of the Recognition~~(3)Includes credit-tranched securities collateralized by sub-prime mortgages, credit risk transfer securities and Measurement of Financial Assets and Financial Liabilities standard on January 1, 2018 (Financial Instruments Recognition and Measurement Standard), equity securities are no longer classified and accounted for as available for sale securities.

Amortized
Cost Gross Unrealized
Gains Gross Unrealized
Losses Fair
Value
OTTI
in AOCI ⁽³⁾
(in millions)
December 31, 2017:
Fixed Maturity Securities:
Public corporate $ 17,181
$ 806
$ 33
$ 17,954
$ —
Private corporate 7,299
225
32
7,492
—
U.S. Treasury, government and agency 17,759
1,000
251
18,508
—
States and political subdivisions 422
67
—
489
—
Foreign governments 395
29
5
419
—
Residential mortgage-backed⁽¹⁾
797
22
1
818
—
Asset-backed⁽²⁾
745
5
1
749
2
Redeemable preferred stock 470
43
1
512
—
Total Fixed Maturities 45,068
2,197
324
46,941
2
Equity securities 188
2
—
190
—
Total at December 31, 2017 $ 45,256
$ 2,199
$ 324
$ 47,131
$ 2


~~(1)~~	~~Includes publicly traded agency pass-through securities and collateralized obligations.~~


~~(2)~~	~~Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans.~~


~~(3)~~	~~Amounts represent OTTI losses in AOCI, which were not included in income (loss) in accordance with current accounting guidance.~~

other asset types.

The contractual maturities of AFS fixed maturities ~~at March 31, 2018~~as of September 30, 2023 are shown in the table below. Bonds not due at a single maturity date have been included in the table in the final year of maturity. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or ~~prepayment~~pre-payment penalties.

~~Available-for-Sale Fixed Maturities~~

~~Contractual Maturities at March 31, 2018~~

Amortized
Cost
Fair Value
(in millions)
Due in one year or less $ 2,499
$ 2,517
Due in years two through five 8,727
8,862
Due in years six through ten 13,290
13,114
Due after ten years 16,990
17,176
Subtotal 41,506
41,669
Residential mortgage-backed securities 614
627
Asset-backed securities 675
675
Redeemable preferred stock 473
513
Total $ 43,268
$ 43,484

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

Contractual Maturities of AFS Fixed Maturities


	Amortized Cost (Less Allowance for Credit Losses)		Fair Value
	(in millions)
September 30, 2023
Contractual maturities:
Due in one year or less	$	1,677	$	1,658
Due in years two through five	14,540		13,675
Due in years six through ten	17,460		15,411
Due after ten years	24,301		17,377
Subtotal	57,978		48,121
Residential mortgage-backed	1,791		1,655
Asset-backed	10,477		10,280
Commercial mortgage-backed	4,051		3,371
Redeemable preferred stock	41		43
Total at September 30, 2023	$	74,338	$	63,470

The following table shows proceeds from sales, gross gains (losses) from sales and ~~OTTI~~allowance for credit losses for AFS fixed ~~maturities during the three months ended March 31, 2018~~maturities:

Proceeds from Sales, Gross Gains (Losses) from Sales and ~~2017:~~ Allowance for Credit and Intent to Sell Losses for AFS Fixed Maturities


	Three Months Ended March 31,							Three Months Ended September 30,				Nine Months Ended September 30,
	2018			2017				2023		2022		2023		2022
	(in millions)							(in millions)
Proceeds from sales	$	3,880		$	440		Proceeds from sales	$	2,524	$	905	$	5,579	$	11,640
Gross gains on sales	$	155		$	25		Gross gains on sales	$	1	$	—	$	8	$	44
Gross losses on sales	$	(52	)	$	(23	)	Gross losses on sales	$	(348)	$	(62)	$	(417)	$	(653)
Total OTTI	$	—		$	—
Non-credit losses recognized in OCI	—			—
Credit losses recognized in net income (loss)	$	—		$	—

Net (increase) decrease in Allowance for Credit and Intent to Sell losses							Net (increase) decrease in Allowance for Credit and Intent to Sell losses	$	(1)	$	(243)	$	(64)	$	(246)

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

The following table sets forth the amount of credit loss impairments on AFS fixed ~~maturity securities~~maturities held by the Company at the dates indicated and the corresponding changes in such amounts:

AFS Fixed Maturities - Credit and Intent to Sell Loss Impairments


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Balance, beginning of period	$	44	$	32	$	36	$	44
Previously recognized impairments on securities that matured, paid, prepaid or sold	(1)		(2)		(58)		(17)
Recognized impairments on securities impaired to fair value this period (1) (2)	—		246		52		246
Credit losses recognized this period on securities for which credit losses were not previously recognized	1		(1)		10		—
Additional credit losses this period on securities previously impaired	—		5		4		7


Balance, end of period	$	44	$	280	$	44	$	280

______________

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Three Months Ended March 31,
2018 2017
(in millions)
Balances, beginning of period $ (18 ) $ (239 )
Previously recognized impairments on securities that matured, paid, prepaid or sold —
55
Recognized impairments on securities impaired to fair value this period⁽¹⁾
—
—
Impairments recognized this period on securities not previously impaired —
—
Additional impairments this period on securities previously impaired —
—
Increases due to passage of time on previously recorded credit losses —
—
Accretion of previously recognized impairments due to increases in expected cash flows —
—
Balances at March 31, $ (18 ) $ (184 )


~~(1)~~	(1)Represents circumstances where the Company determined in ~~the current period that it intends to sell the security or it is more likely than not that it will be required to sell the security before recovery of the security’s amortized cost.~~

Net unrealized investment gains (losses) on fixed maturities and equity securities classified as AFS are included in the consolidated balance sheets as a component of AOCI. The table below presents these amounts as of the dates indicated:

March 31,
2018 December 31, 2017
(in millions)
AFS Securities:
Fixed maturities:
With OTTI loss $ —
$ 2
All other 216
1,871
Equity securities —
2
Net Unrealized Gains (Losses) $ 216
$ 1,875

As a result of the adoption of the Recognition and Measurement of Financial Assets and Financial Liabilities standard on January 1, 2018 (Financial Instruments Recognition and Measurement Standard), equity securities are no longer classified and accounted for as available for sale securities.

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~Changes in net unrealized investment gains (losses) recognized in AOCI include reclassification adjustments to reflect amounts realized in Net income (loss) for~~ the current period that ~~had been part~~it intends to sell the security, or it is more likely than not that it will be required to sell the security before recovery of ~~OCI~~the security’s amortized cost.

(2)Amounts reflected for the nine months ended September 30, 2023 represent AFS fixed maturities in ~~earlier periods.~~ an unrealized loss position, which the Company sold in anticipation of Equitable Financial’s ordinary dividend to Holdings.

The tables ~~that follow~~ below present a ~~rollforward~~roll-forward of net unrealized investment gains (losses) recognized in ~~AOCI, split between amounts related to fixed maturity securities on which an OTTI loss has been recognized and all other:~~AOCI:

Net Unrealized Gains (Losses) on AFS Fixed Maturities ~~with OTTI Losses~~


	Three Months Ended September 30, 2023
	Net Unrealized Gains (Losses) on Investments		Policyholders’ Liabilities		Deferred Income Tax Asset (Liability)		AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)
	(in millions)
Balance, beginning of period	$	(8,641)	$	36	$	238	$	(8,367)
Net investment gains (losses) arising during the period	(2,575)		—		—		(2,575)
Reclassification adjustment:
Included in net income (loss)	348		—		—		348
Excluded from net income (loss)	—		—		—		—
Other	—		—		—		—
Impact of net unrealized investment gains (losses)	—		38		460		498
Net unrealized investment gains (losses) excluding credit losses	(10,868)		74		698		(10,096)
Net unrealized investment gains (losses) with credit losses	1		—		—		1
Balance, end of period	$	(10,867)	$	74	$	698	$	(10,095)

	Three Months Ended September 30, 2022
	Net Unrealized Gains (Losses) on Investments		Policyholders’ Liabilities		Deferred Income Tax Asset (Liability)		AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)
	(in millions)
Balance, beginning of period	$	(6,965)	$	25	$	1,457	$	(5,483)
Net investment gains (losses) arising during the period	(4,045)		—		—		(4,045)
Reclassification adjustment:
Included in net income (loss)	311		—		—		311
Excluded from net income (loss)	—		—		—		—
Other	—		—		—		—
Impact of net unrealized investment gains (losses)	—		16		781		797
Net unrealized investment gains (losses) excluding credit losses	(10,699)		41		2,238		(8,420)
Net unrealized investment gains (losses) with credit losses	1		—		—		1
Balance, end of period	$	(10,698)	$	41	$	2,238	$	(8,419)

Net
Unrealized
Gains
(Losses) on
Investments DAC Policyholders’
Liabilities Deferred
Income
Tax Asset
(Liability) AOCI Gain
(Loss) Related
to Net
Unrealized
Investment
Gains (Losses)
(in millions)
Balance, January 1, 2018 $ 2
$ —
$ (1 ) $ (7 ) $ (6 )
Net investment gains (losses) arising during the period —
—
—
—
—
Reclassification adjustment for OTTI losses:
Included in Net income (loss) (2 ) —
—
—
(2 )
Excluded from Net income (loss)⁽¹⁾
—
—
—
—
—
Impact of net unrealized investment gains (losses) on:
DAC —
—
—
—
—
Deferred income taxes —
—
—
7
7
Policyholders’ liabilities —
—
1
—
1
Balance, March 31, 2018 $ —
$ —
$ —
$ —
$ —
Balance, January 1, 2017 $ 19
$ 1
$ (10 ) $ (4 ) $ 6
Net investment gains (losses) arising during the period 63
—
—
—
63
Reclassification adjustment for OTTI losses:
Included in Net income (loss) (65 ) —
—
—
(65 )
Excluded from Net income (loss)⁽¹⁾
—
—
—
—
—
Impact of net unrealized investment gains (losses) on:
DAC —
(4 ) —
—
(4 )
Deferred income taxes —
—
—
—
—
Policyholders’ liabilities —
—
6
—
6
Balance, March 31, 2017 $ 17
$ (3 ) $ (4 ) $ (4 ) $ 6


~~(1)~~	~~Represents “transfers in” related to the portion of OTTI losses recognized during the period that were not recognized in income (loss) for securities with no prior OTTI loss.~~

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

~~All Other Net Unrealized Investment Gains (Losses) In AOCI~~


	Nine Months Ended September 30, 2023
	Net Unrealized Gains (Losses) on Investments		Policyholders’ Liabilities		Deferred Income Tax Asset (Liability)		AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)
	(in millions)
Balance, beginning of period	$	(9,606)	$	41	$	440	$	(9,125)
Net investment gains (losses) arising during the period	(1,730)		—		—		(1,730)
Reclassification adjustment:
Included in net income (loss)	474		—		—		474

Other	—		—		—		—
Impact of net unrealized investment gains (losses)	—		33		257		290
Net unrealized investment gains (losses) excluding credit losses	(10,862)		74		697		(10,091)
Net unrealized investment gains (losses) with credit losses	(5)		—		1		(4)
Balance, end of period	$	(10,867)	$	74	$	698	$	(10,095)

	Nine Months Ended September 30, 2022
	Net Unrealized Gains (Losses) on Investments		Policyholders’ Liabilities		Deferred Income Tax Asset (Liability)		AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)
	(in millions)
Balance, beginning of period	$	4,809	$	(169)	$	(974)	$	3,666
Net investment gains (losses) arising during the period	(16,359)		—		—		(16,359)
Reclassification adjustment:
Included in net income (loss)	859		—		—		859

Other	—		—		—		—
Impact of net unrealized investment gains (losses)	—		210		3,210		3,420
Net unrealized investment gains (losses) excluding credit losses	(10,691)		41		2,236		(8,414)
Net unrealized investment gains (losses) with credit losses	(7)		—		2		(5)
Balance, end of period	$	(10,698)	$	41	$	2,238	$	(8,419)

Net
Unrealized
Gains
(Losses) on
Investments DAC Policyholders’
Liabilities Deferred
Income
Tax Asset
(Liability) AOCI Gain
(Loss) Related
to Net
Unrealized
Investment
Gains (Losses)
(in millions)
Balance, January 1, 2018 $ 1,871
$ (358 ) $ (238 ) $ (383 ) $ 892
Net investment gains (losses) arising during the period (109 ) —
—
—
(109 )
Reclassification adjustment for OTTI losses:

Included in Net income (loss) (1,546 ) —
—
—
(1,546 )
Excluded from Net income (loss)⁽¹⁾
—
—
—
—
—
Impact of net unrealized investment gains (losses) on:

DAC —
341
—
—
341
Deferred income taxes —
—
—
239
239
Policyholders’ liabilities —
—
110
—
110
Balance, March 31, 2018 $ 216

$ (17 )
$ (128 )
$ (144 )
$ (73 )
Balance, January 1, 2017 $ 528
$ (45 ) $ (192 ) $ (95 ) $ 196
Net investment gains (losses) arising during the period 176
—
—
—
176
Reclassification adjustment for OTTI losses:

Included in Net income (loss) 29
—
—
—
29
Excluded from Net income (loss)⁽¹⁾

—
—
—
—
Impact of net unrealized investment gains (losses) on:

DAC —
(68 ) —
—
(68 )
Deferred income taxes —
—
—
(60 ) (60 )
Policyholders’ liabilities —
—
14
—
14
Balance, March 31, 2017 $ 733
$ (113 ) $ (178 ) $ (155 ) $ 287


~~(1)~~	~~Represents “transfers out” related to the portion of OTTI losses during the period that were not recognized in income (loss) for securities with no prior OTTI loss.~~

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

The following tables disclose the fair values and gross unrealized losses of the ~~1,411~~5,517 issues ~~at March 31, 2018~~as of September 30, 2023 and the ~~752~~5,209 issues atas of December 31, ~~2017 of fixed maturities~~2022 that are not deemed to ~~be other-than-temporarily impaired,~~have credit losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position for the specified periods at the dates indicated:

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Less Than 12 Months 12 Months or Longer Total

Fair
Value

Gross
Unrealized
Losses

Fair
Value

Gross
Unrealized
Losses

Fair
Value

Gross
Unrealized
Losses
(in millions)
March 31, 2018:
Fixed Maturity Securities:
Public corporate $ 8,539
$ 263
$ 605
$ 35
$ 9,144
$ 298
Private corporate 2,457
63
660
44
3,117
107
U.S. Treasury, government and agency 3,129
81
4,325
425
7,454
506
States and political subdivisions 19
1
—
—
19
1
Foreign governments 57
2
70
7
127
9
Residential mortgage-backed 145
2
76
1
221
3
Asset-backed 81
4
1
—
82
4
Redeemable preferred stock 116
2
12
2
128
4
Total $ 14,543
$ 418

$ 5,749

$ 514

$ 20,292

$ 932
December 31, 2017:
Fixed Maturity Securities:
Public corporate $ 2,123
$ 15
$ 690
$ 18
$ 2,813
$ 33
Private corporate 780
8
641
24
1,421
32
U.S. Treasury, government and agency 2,718
6
4,506
245
7,224
251
States and political subdivisions 20
—
—
—
20
—
Foreign governments 11
—
73
5
84
5
Residential mortgage-backed 62
—
76
1
138
1
Asset-backed 15
1
12
—
27
1
Redeemable preferred stock 10
—
13
1
23
1
Total $ 5,739
$ 30
$ 6,011
$ 294
$ 11,750
$ 324
AFS Fixed Maturities in an Unrealized Loss Position for Which No Allowance Is Recorded

The Company’s investments in fixed maturity securities do not include concentrations of credit risk of any single issuer greater than 10% of the consolidated equity of the Company, other than securities of the U.S. government, U.S. government agencies, and certain securities guaranteed by the U.S. government.


	Less Than 12 Months				12 Months or Longer				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(in millions)
September 30, 2023
Fixed Maturities:
Corporate	$	7,091	$	349	$	32,564	$	7,733	$	39,655	$	8,082
U.S. Treasury, government and agency	175		7		3,994		1,566		4,169		1,573
States and political subdivisions	137		2		270		100		407		102
Foreign governments	46		2		556		159		602		161
Residential mortgage-backed	967		22		675		114		1,642		136
Asset-backed	2,067		18		6,244		194		8,311		212
Commercial mortgage-backed	300		8		2,956		672		3,256		680

Total at September 30, 2023	$	10,783	$	408	$	47,259	$	10,538	$	58,042	$	10,946

December 31, 2022:
Fixed Maturities:
Corporate	$	24,580	$	2,668	$	16,534	$	4,536	$	41,114	$	7,204
U.S. Treasury, government and agency	5,564		1,200		204		18		5,768		1,218
States and political subdivisions	130		25		173		64		303		89
Foreign governments	349		42		417		109		766		151
Residential mortgage-backed	671		49		83		38		754		87
Asset-backed	6,298		230		1,765		143		8,063		373
Commercial mortgage-backed	1,577		201		1,640		387		3,217		588

Total at December 31, 2022	$	39,169	$	4,415	$	20,816	$	5,295	$	59,985	$	9,710

The Company maintains a diversified portfolio of corporate securities across industries and issuers and does not have exposure to any single issuer in excess of ~~0.5%~~0.9% of total ~~investments.~~corporate securities. The largest exposures to a single issuer of corporate securities held ~~at March 31, 2018~~as of September 30, 2023 and December 31, ~~2017~~2022 were ~~$219~~$400 million and ~~$207~~$327 million, ~~respectively.~~ respectively, representing 12.2% and 10.4% of the consolidated equity of the Company.

Corporate high yield securities, consisting primarily of public high yield bonds, are classified as other than investment grade by the various rating agencies, i.e., a rating below Baa3/BBB- or the ~~National Association of Insurance Commissioners (“NAIC”)~~NAIC designation of 3 (medium investment grade), 4 or 5 (below investment grade) or 6 (in or near default). ~~At March 31, 2018~~As of September 30, 2023 and December 31, ~~2017,~~2022, respectively, approximately ~~$1,335 million~~$2.7 billion and ~~$1,372 million,~~$2.9 billion, or ~~3.1%~~3.7% and ~~3.0%~~4.0%, of the ~~$43,268 million~~$74.3 billion and ~~$45,068 million~~$73.0 billion aggregate amortized cost of fixed maturities held by the Company were considered to be other than investment grade. These securities had ~~net~~gross unrealized losses of ~~$14~~$153 million and $5$208 million ~~at March 31, 2018~~as of September 30, 2023 and December 31, ~~2017,~~2022, respectively. ~~At March 31, 2018~~

As of September 30, 2023 and December 31, ~~2017,~~2022, respectively, the ~~$514 million~~$10.5 billion and ~~$294 million~~$5.3 billion of gross

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

unrealized losses of twelve months or more were primarily concentrated in corporate ~~and U.S. Treasury, government and agency~~ securities. In accordance with the policy described in Note 2 of the Notes to these Consolidated Financial Statements, the Company concluded that an adjustment to ~~income~~the allowance for ~~OTTI~~credit losses for these securities was not warranted at either ~~March~~September 30, 2023 or December 31, ~~2018 or 2017. At March 31, 2018~~2022. As of September 30, 2023 and December 31, ~~2017,~~2022, the Company did not intend to sell the securities nor will it likely be required to dispose of the securities before the anticipated recovery of their remaining amortized cost basis.

~~The Company does not originate, purchase or warehouse residential mortgages~~Based on the Company’s evaluation both qualitatively and ~~is not~~quantitatively of the drivers of the decline in ~~the mortgage servicing business. At March 31, 2018, the carrying~~fair value of fixed ~~maturities~~maturity securities as of September 30, 2023, the Company determined that ~~were non-income producing~~the unrealized loss was primarily due to increases in interest rates and credit spreads.

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Securities Lending

The Company has entered into securities lending agreements with an agent bank whereby blocks of securities are loaned to third parties, primarily major brokerage firms. As of September 30, 2023, the estimated fair value of loaned securities was $111 million. The agreements require a minimum of 102% of the fair value of the loaned securities to be held as cash collateral, calculated daily. To further minimize the credit risks related to these programs, the financial condition of counterparties is monitored on a regular basis. As of September 30, 2023, cash collateral received in the amount of $113 million, was invested by the agent bank. A securities lending payable for the ~~twelve months preceding that date was $3 million.~~

~~For~~overnight and continuous loans is included in other liabilities in the amount of cash collateral received. Securities lending transactions are used to generate income. Income and expenses associated with these transactions are reported as net investment income and were not material for the three and nine months ended ~~March~~September 30, 2023.

Mortgage Loans on Real Estate

In September 2023, the Company began investing in residential mortgage loans. Accrued interest receivable on commercial, agricultural and residential mortgage loans as of September 30, 2023 and December 31, ~~2018~~2022 was $78 million and ~~2017, investment~~$71 million, respectively. There was no accrued interest written off for commercial, agricultural and residential mortgage loans for the nine months ended September 30, 2023 and 2022.

As of September 30, 2023, the Company had no loans for which foreclosure was probable included within the individually assessed mortgage loans, and accordingly had no associated allowance for credit losses.

Allowance for Credit Losses on Mortgage Loans

The change in the allowance for credit losses for commercial, agricultural and residential mortgage loans were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Allowance for credit losses on mortgage loans:
Commercial mortgages:
Balance, beginning of period	$	140	$	58	$	123	$	57
Current-period provision for expected credit losses	63		19		80		20
Write-offs charged against the allowance	—		—		—		—
Recoveries of amounts previously written off	—		—		—		—
Net change in allowance	63		19		80		20
Balance, end of period	$	203	$	77	$	203	$	77

Agricultural mortgages:
Balance, beginning of period	$	5	$	6	$	6	$	5
Current-period provision for expected credit losses	1		—		—		1
Write-offs charged against the allowance	—		—		—		—
Recoveries of amounts previously written off	—		—		—		—
Net change in allowance	1		—		—		1
Balance, end of period	$	6	$	6	$	6	$	6

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Residential mortgages:
Balance, beginning of period	$	—	$	—	$	—	$	—
Current-period provision for expected credit losses	—		—		—		—
Write-offs charged against the allowance	—		—		—		—
Recoveries of amounts previously written off	—		—		—		—
Net change in allowance	—		—		—		—
Balance, end of period	$	—	$	—	$	—	$	—

Total allowance for credit losses	$	209	$	83	$	209	$	83

The change in the allowance for credit losses is attributable to:

•increases/decreases in the loan balance due to new originations, maturing mortgages, and loan amortization; and

•changes in credit quality and economic assumptions.

Credit Quality Information

The Company’s commercial and agricultural mortgage loans segregated by risk rating exposure were as follows:

Loan to Value (“LTV”) Ratios (1) (3)


	September 30, 2023
	Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Commercial and agricultural mortgage loans:
Commercial:
0% - 50%	$	250	$	484	$	130	$	35	$	—	$	1,620	$	—	$	—	$	2,519
50% - 70%	688		2,313		815		869		257		2,618		419		96		8,075
70% - 90%	247		488		1,139		463		289		1,198		6		36		3,866
90% plus	—		—		34		—		92		696		—		—		822
Total commercial	$	1,185	$	3,285	$	2,118	$	1,367	$	638	$	6,132	$	425	$	132	$	15,282

Agricultural:
0% - 50%	$	86	$	163	$	186	$	235	$	134	$	811	$	—	$	—	$	1,615
50% - 70%	46		146		162		204		58		303		—		—		919
70% - 90%	—		—		—		—		—		16		—		—		16
90% plus	—		—		—		—		—		—		—		—		—
Total agricultural	$	132	$	309	$	348	$	439	$	192	$	1,130	$	—	$	—	$	2,550

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	September 30, 2023
	Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Total commercial and agricultural mortgage loans:
0% - 50%	$	336	$	647	$	316	$	270	$	134	$	2,431	$	—	$	—	$	4,134
50% - 70%	734		2,459		977		1,073		315		2,921		419		96		8,994
70% - 90%	247		488		1,139		463		289		1,214		6		36		3,882
90% plus	—		—		34		—		92		696		—		—		822
Total commercial and agricultural mortgage loans	$	1,317	$	3,594	$	2,466	$	1,806	$	830	$	7,262	$	425	$	132	$	17,832

Debt Service Coverage (“DSC”) Ratios (2) (3)


	September 30, 2023
	Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Commercial and agricultural mortgage loans:
Commercial:
Greater than 2.0x	$	175	$	695	$	1,126	$	1,140	$	157	$	3,127	$	—	$	—	$	6,420
1.8x to 2.0x	—		—		181		167		172		737		256		96		1,609
1.5x to 1.8x	81		799		234		—		236		984		92		—		2,426
1.2x to 1.5x	522		762		455		—		30		761		6		—		2,536
1.0x to 1.2x	400		674		43		—		43		416		71		36		1,683
Less than 1.0x	7		355		79		60		—		107		—		—		608
Total commercial	$	1,185	$	3,285	$	2,118	$	1,367	$	638	$	6,132	$	425	$	132	$	15,282

Agricultural:
Greater than 2.0x	$	7	$	51	$	39	$	60	$	20	$	184	$	—	$	—	$	361
1.8x to 2.0x	16		16		56		32		23		62		—		—		205
1.5x to 1.8x	9		50		31		109		18		199		—		—		416
1.2x to 1.5x	38		111		155		173		99		374		—		—		950
1.0x to 1.2x	33		57		63		57		26		287		—		—		523
Less than 1.0x	29		24		4		8		6		24		—		—		95
Total agricultural	$	132	$	309	$	348	$	439	$	192	$	1,130	$	—	$	—	$	2,550

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	September 30, 2023
	Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Total commercial and agricultural mortgage loans:
Greater than 2.0x	$	182	$	746	$	1,165	$	1,200	$	177	$	3,311	$	—	$	—	$	6,781
1.8x to 2.0x	16		16		237		199		195		799		256		96		1,814
1.5x to 1.8x	90		849		265		109		254		1,183		92		—		2,842
1.2x to 1.5x	560		873		610		173		129		1,135		6		—		3,486
1.0x to 1.2x	433		731		106		57		69		703		71		36		2,206
Less than 1.0x	36		379		83		68		6		131		—		—		703
Total commercial and agricultural mortgage loans	$	1,317	$	3,594	$	2,466	$	1,806	$	830	$	7,262	$	425	$	132	$	17,832

______________

(1)The LTV ratio is derived from current loan balance divided by the fair value of the property. The fair value of the underlying commercial properties is updated annually for each mortgage loan.

(2)The DSC ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.

(3)Residential mortgage loans are excluded from the above tables.

LTV Ratios (1) (3)


	December 31, 2022
	Amortized Cost Basis by Origination Year
	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Commercial and agricultural mortgage loans:
Commercial:
0% - 50%	$	624	$	130	$	—	$	—	$	119	$	1,259	$	—	$	—	$	2,132
50% - 70%	2,285		1,569		906		313		623		2,254		328		—		8,278
70% - 90%	363		415		463		329		424		1,314		—		34		3,342
90% plus	—		—		—		—		35		233		—		—		268
Total commercial	$	3,272	$	2,114	$	1,369	$	642	$	1,201	$	5,060	$	328	$	34	$	14,020

Agricultural:
0% - 50%	$	163	$	182	$	228	$	129	$	132	$	725	$	—	$	—	$	1,559
50% - 70%	190		185		222		68		83		267		—		—		1,015
70% - 90%	—		—		—		—		—		16		—		—		16
90% plus	—		—		—		—		—		—		—		—		—
Total agricultural	$	353	$	367	$	450	$	197	$	215	$	1,008	$	—	$	—	$	2,590

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	December 31, 2022
	Amortized Cost Basis by Origination Year
	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Total commercial and agricultural mortgage loans:
0% - 50%	$	787	$	312	$	228	$	129	$	251	$	1,984	$	—	$	—	$	3,691
50% - 70%	2,475		1,754		1,128		381		706		2,521		328		—		9,293
70% - 90%	363		415		463		329		424		1,330		—		34		3,358
90% plus	—		—		—		—		35		233		—		—		268
Total commercial and agricultural mortgage loans	$	3,625	$	2,481	$	1,819	$	839	$	1,416	$	6,068	$	328	$	34	$	16,610

DSC Ratios (2) (3)


	December 31, 2022
	Amortized Cost Basis by Origination Year
	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Commercial and agricultural mortgage loans:
Commercial:
Greater than 2.0x	$	771	$	1,159	$	1,113	$	102	$	571	$	1,923	$	—	$	—	$	5,639
1.8x to 2.0x	158		215		164		197		186		482		279		—		1,681
1.5x to 1.8x	337		390		32		153		176		1,175		4		—		2,267
1.2x to 1.5x	1,041		259		—		92		73		917		—		—		2,382
1.0x to 1.2x	507		43		60		98		160		492		45		34		1,439
Less than 1.0x	458		48		—		—		35		71		—		—		612
Total commercial	$	3,272	$	2,114	$	1,369	$	642	$	1,201	$	5,060	$	328	$	34	$	14,020

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	December 31, 2022
	Amortized Cost Basis by Origination Year
	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Agricultural:
Greater than 2.0x	$	51	$	40	$	62	$	21	$	12	$	193	$	—	$	—	$	379
1.8x to 2.0x	16		58		35		24		14		51		—		—		198
1.5x to 1.8x	69		42		111		18		19		196		—		—		455
1.2x to 1.5x	107		147		177		98		99		298		—		—		926
1.0x to 1.2x	91		80		61		30		60		257		—		—		579
Less than 1.0x	19		—		4		6		11		13		—		—		53
Total agricultural	$	353	$	367	$	450	$	197	$	215	$	1,008	$	—	$	—	$	2,590


Total commercial and agricultural mortgage loans:
Greater than 2.0x	$	822	$	1,199	$	1,175	$	123	$	583	$	2,116	$	—	$	—	$	6,018
1.8x to 2.0x	174		273		199		221		200		533		279		—		1,879
1.5x to 1.8x	406		432		143		171		195		1,371		4		—		2,722
1.2x to 1.5x	1,148		406		177		190		172		1,215		—		—		3,308
1.0x to 1.2x	598		123		121		128		220		749		45		34		2,018
Less than 1.0x	477		48		4		6		46		84		—		—		665
Total commercial and agricultural mortgage loans	$	3,625	$	2,481	$	1,819	$	839	$	1,416	$	6,068	$	328	$	34	$	16,610

______________

(1)The LTV ratio is ~~shown net~~derived from current loan balance divided by the fair value of ~~investment expenses~~the property. The fair value of the underlying commercial properties is updated annually for each mortgage loan.

(2)The DSC ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.

(3)Residential mortgage loans are excluded from the above tables.

The amortized cost of residential mortgage loans by credit quality indicator and origination year was as follows:


	September 30, 2023
	Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Total
	(in millions)
Performance indicators:
Performing	$	21	$	11	$	—	$	—	$	—	$	—	$	32
Nonperforming	—		—		—		—		—		—		—
Total	$	21	$	11	$	—	$	—	$	—	$	—	$	32

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Past-Due and Nonaccrual Mortgage Loan Status

The aging analysis of past-due mortgage loans were as follows:

Age Analysis of Past Due Mortgage Loans (1)


	Accruing Loans												Non-accruing Loans		Total Loans		Non-accruing Loans with No Allowance		Interest Income on Non-accruing Loans
	Past Due								Current		Total
	30-59 Days		60-89 Days		90 Days or More		Total
	(in millions)
September 30, 2023:
Mortgage loans:
Commercial	$	—	$	—	$	—	$	—	$	15,248	$	15,248	$	34	$	15,282	$	—	$	1
Agricultural	18		4		42		64		2,467		2,531		19		2,550		3		—
Residential	—		—		—		—		32		32		—		32		—		—
Total	$	18	$	4	$	42	$	64	$	17,747	$	17,811	$	53	$	17,864	$	3	$	1

December 31, 2022:
Mortgage loans:
Commercial	$	56	$	—	$	—	$	56	$	13,964	$	14,020	$	—	$	14,020	$	—	$	—
Agricultural	3		5		13		21		2,553		2,574		16		2,590		—		—
Residential	—		—		—		—		—		—		—		—		—		—
Total	$	59	$	5	$	13	$	77	$	16,517	$	16,594	$	16	$	16,610	$	—	$	—

_______________

(1)Amounts presented at amortized cost basis.

As of September 30, 2023 and December 31, 2022, the amortized cost of problem mortgage loans that had been classified as non-accrual loans were $19 million and ~~$19~~$16 million, respectively.

~~At March 31, 2018~~

Troubled Debt Restructuring

During the first quarter of 2023, the Company granted a modification to a $56 million commercial real estate loan. The modification reflects a pay and accrue structure where the loan was converted to interest only, and the pay rate is lower than the current rate beginning in 2023; 0.35% in 2023 and stepping up annually until it reaches the existing coupon of 5.0% in 2027. Interest between the pay rate and the coupon rate will be accrued and added to the loan monthly. Additionally, any excess cash flow above the pay rate will be applied to the loan. For the accounting policy pertaining to our TDRs see Note 2 of the Notes to these Consolidated Financial Statements.

During the three and nine months ended September 30, 2023 and 2022 the Company identified an immaterial amount of TDRs.

Equity Securities

The breakdown of unrealized and realized gains and (losses) on equity securities was as follows:

Unrealized and Realized Gains (Losses) from Equity Securities


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Net investment gains (losses) recognized during the period on securities held at the end of the period	$	(5)	$	(33)	$	(3)	$	(143)
Net investment gains (losses) recognized on securities sold during the period	(6)		—		(9)		(11)
Unrealized and realized gains (losses) on equity securities	$	(11)	$	(33)	$	(12)	$	(154)

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Trading Securities

As of September 30, 2023 and December 31, ~~2017,~~2022, respectively, the fair ~~values~~value of the Company’s trading ~~account~~ securities ~~were $14,919 million~~was $1.0 billion and ~~$14,170 million, respectively. Also at March 31, 2018~~$677 million. As of September 30, 2023 and December 31, ~~2017,~~2022, respectively, trading securities included the General Account’s investment in Separate Accounts ~~which~~ had carrying values of ~~$49~~$45 million and ~~$50 million, respectively.~~$39 million.

~~Net unrealized and realized gains (losses) on trading account equity securities are included in Net~~The breakdown of net investment income (loss) ~~in the Consolidated Statements of Income (Loss). The table below shows a breakdown of Net investment income~~ from trading ~~account~~ securities ~~during the three months ended March 31, 2018 and 2017:~~was as follows:

Net Investment Income (Loss) from Trading Securities


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Net investment gains (losses) recognized during the period on securities held at the end of the period	$	(26)	$	(44)	$	20	$	(246)
Net investment gains (losses) recognized on securities sold during the period	(1)		—		(3)		6
Unrealized and realized gains (losses) on trading securities	(27)		(44)		17		(240)
Interest and dividend income from trading securities	8		2		20		20
Net investment income (loss) from trading securities	$	(19)	$	(42)	$	37	$	(220)

Three Months Ended March 31,
2018 2017
(in millions)
Net investment gains (losses) recognized during the period on securities held at the end of the period $ (121 ) $ 87
Net investment gains (losses) recognized on securities sold during the period 1
4
Unrealized and realized gains (losses) on trading securities arising during the period (120 ) 91
Interest and dividend income from trading securities 76
63
Net investment income (loss) from trading securities $ (44 ) $ 154

~~Mortgage Loans~~Fixed maturities, at fair value using the fair value option

The ~~payment terms~~breakdown of ~~mortgage loans may~~net investment income (loss) from ~~time to time be restructured or modified.~~

~~Mortgage loans on real estate are placed on nonaccrual status once management determines~~fixed maturities, at fair value using the collection of accrued interest is doubtful. Once mortgage loans on real estate are classified as nonaccrual loans, interest income is recognized under the cash basis of accounting and the resumption of the interest accrual would commence only after all past due interest has been collected or the mortgage loan on real estate has been restructured to where the collection of interest is considered likely. At March 31, 2018 and December 31, 2017, the carrying values of commercial mortgage loans on real estate that had been classified as nonaccrual loansfair value option were ~~$19 million and $19 million, respectively.~~

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~Valuation Allowances for Mortgage Loans:~~

~~Allowance for credit losses for mortgage loans for the first quarters of 2018 and 2017 are~~ as follows:

Net Investment Income (Loss) from Fixed Maturities, at Fair Value using the Fair Value Option


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Net investment gains (losses) recognized during the period on securities held at the end of the period	$	4	$	(7)	$	23	$	(20)
Net investment gains (losses) recognized on securities sold during the period	(5)		(1)		(19)		5
Unrealized and realized gains (losses) from fixed maturities	(1)		(8)		4		(15)
Interest and dividend income from fixed maturities	3		1		7		—
Net investment income (loss) from fixed maturities	$	2	$	(7)	$	11	$	(15)

Three Months Ended March 31,
2018 2017
(in millions)
Allowance for credit losses:
Beginning balance, January 1, $ 8
$ 8
Charge-offs —
—
Recoveries (1 ) —
Provision —
—
Ending balance, March 31, $ 7
$ 8

March 31, Individually Evaluated for Impairment $ 7
$ 8

~~There were no allowances for credit losses for agricultural mortgage loans for the first quarters of 2018 and 2017.~~

~~Real Estate:~~

In March 2018, the Company sold its interest in two consolidated real estate joint ventures to AXA France for a total purchase price of approximately $143 million, which resulted in a pre-tax loss of $0.2 million and the reduction of $203 million of long-term debt on the Company’s balance sheet for the first quarter of 2018.Net Investment Income

The following tables ~~provide information relating to~~provides the loan-to-value and debt service coverage ratios for commercial and agricultural mortgage loans at March 31, 2018 and December 31, 2017. The values used in these ratio calculations were developed as partcomponents of ~~the periodic review of the commercial and agricultural mortgage loan portfolio, which includes an evaluation of the underlying collateral value.~~net investment income by investment type:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Fixed maturities	$	788	$	700	$	2,254	$	1,939
Mortgage loans on real estate	224		148		599		424
Other equity investments	33		13		63		129
Policy loans	55		49		158		160
Trading securities	(19)		(42)		37		(220)
Other investment income	18		14		59		17
Fixed maturities, at fair value using the fair value option	2		(7)		11		(15)
Gross investment income (loss)	1,101		875		3,181		2,434
Investment expenses	(30)		(33)		(84)		(77)
Net investment income (loss)	$	1,071	$	842	$	3,097	$	2,357

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

Investment Gains (Losses), Net

~~Mortgage Loans by Loan-to-Value~~Investment gains (losses), net, including changes in the valuation allowances and ~~Debt Service Coverage Ratios~~credit losses were as follows:

~~March 31, 2018~~


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Fixed maturities	$	(348)	$	(311)	$	(475)	$	(859)
Mortgage loans on real estate	(63)		(19)		(80)		(21)
Other equity investments (1)	—		—		—		—
Other	—		(2)		1		(10)
Investment gains (losses), net	$	(411)	$	(332)	$	(554)	$	(890)

_____________

(1) Investment gains (losses), net of Other equity investments includes Real Estate Held for production.

Investment results passed through to certain participating group annuity contracts as interest credited to policyholders’ account balances totaled $0 million and $1 million for the three and nine months ended September 30, 2023, respectively, and $0 million and $1 million for the three and nine months ended September 30, 2022, respectively.

Debt Service Coverage Ratio⁽¹⁾

Loan-to-Value Ratio:⁽²⁾
Greater than 2.0x 1.8x to 2.0x 1.5x to 1.8x 1.2x to 1.5x 1.0x to 1.2x Less than 1.0x
Total Mortgage
Loans
(in millions)
Commercial Mortgage Loans⁽¹⁾

0% - 50% $ 737
$ 21
$ 321
$ 73
$ —
$ —
$ 1,152
50% - 70% 4,477
643
1,122
399
178
—
6,819
70% - 90% 169
110
144
307
27
—
757
90% plus —
—
27
—
—
—
27
Total Commercial Mortgage Loans $ 5,383
$ 774
$ 1,614
$ 779
$ 205
$ —
$ 8,755
Agricultural Mortgage Loans⁽¹⁾

0% - 50% $ 275
$ 153
$ 276
$ 496
$ 321
$ 29
$ 1,550
50% - 70% 111
46
219
360
228
48
1,012
70% - 90% —
—
—
23
—
—
23
90% plus —
—
—
—
—
—
—
Total Agricultural Mortgage Loans $ 386
$ 199
$ 495
$ 879
$ 549
$ 77
$ 2,585
Total Mortgage Loans⁽¹⁾

0% - 50% $ 1,012
$ 174
$ 597
$ 569
$ 321
$ 29
$ 2,702
50% - 70% 4,588
689
1,341
759
406
48
7,831
70% - 90% 169
110
144
330
27
—
780
90% plus —
—
27
—
—
—
27
Total Mortgage Loans $ 5,769
$ 973
$ 2,109
$ 1,658
$ 754
$ 77
$ 11,340


~~(1)~~	~~The debt service coverage ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.~~


~~(2)~~	~~The loan-to-value ratio is derived from current loan balance divided by the fair market value of the property. The fair market value of the underlying commercial properties is updated annually.~~

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

~~Mortgage Loans by Loan-to-Value and Debt Service Coverage Ratios~~

~~December 31, 2017~~

Debt Service Coverage Ratio⁽¹⁾

Loan-to-Value Ratio:⁽²⁾
Greater than 2.0x 1.8x to 2.0x 1.5x to 1.8x 1.2x to1.5x 1.0x to 1.2x Less than 1.0x Total Mortgage Loans
(in millions)
Commercial Mortgage Loans⁽¹⁾

0% - 50% $ 759
$ —
$ 320
$ 74
$ —
$ —
$ 1,153
50% - 70% 4,088
682
1,066
428
145
—
6,409
70% - 90% 169
110
196
272
50
—
797
90% plus —
—
27
—
—
—
27
Total Commercial Mortgage Loans $ 5,016
$ 792
$ 1,609
$ 774
$ 195
$ —
$ 8,386
Agricultural Mortgage Loans⁽¹⁾

0% - 50% $ 272
$ 149
$ 275
$ 515
$ 316
$ 30
$ 1,557
50% - 70% 111
46
227
359
221
49
1,013
70% - 90% —
—
—
4
—
—
4
90% plus —
—
—
—
—
—
—
Total Agricultural Mortgage Loans $ 383
$ 195
$ 502
$ 878
$ 537
$ 79
$ 2,574
Total Mortgage Loans⁽¹⁾

0% - 50% $ 1,031
$ 149
$ 595
$ 589
$ 316
$ 30
$ 2,710
50% - 70% 4,199
728
1,293
787
366
49
7,422
70% - 90% 169
110
196
276
50
—
801
90% plus —
—
27
—
—
—
27
Total Mortgage Loans $ 5,399
$ 987
$ 2,111
$ 1,652
$ 732
$ 79
$ 10,960


~~(1)~~	~~The debt service coverage ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.~~


~~(2)~~	~~The loan-to-value ratio is derived from current loan balance divided by the fair market value of the property. The fair market value of the underlying commercial properties is updated annually.~~

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~The following table provides information relating to the aging analysis of past due mortgage loans at March 31, 2018 and December 31, 2017, respectively.~~

~~Age Analysis of Past Due Mortgage Loan~~

30-59
    Days

60-89
    Days

90
    Days
or >
Total     Current
Total
Financing
Receivables

Recorded
Investment 90 Days or >
and
Accruing
(in millions)
March 31, 2018
Commercial $ —
$ —
$ 27
$ 27
$ 8,728
$ 8,755
$ —
Agricultural 10
5
39
54
2,531
2,585
39
Total Mortgage Loans $ 10
$ 5
$ 66
$ 81
$ 11,259
$ 11,340
$ 39
December 31, 2017
Commercial $ 27
$ —
$ —
$ 27
$ 8,359
$ 8,386
$ —
Agricultural 49
3
22
74
2,500
2,574
22
Total Mortgage Loans $ 76
$ 3
$ 22
$ 101
$ 10,859
$ 10,960
$ 22

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~The following table provides information relating to impaired mortgage loans at March 31, 2018 and December 31, 2017, respectively.~~

~~Impaired Mortgage Loans~~

Recorded
Investment

Unpaid
Principal
Balance

Related
Allowance

Average
Recorded
Investment⁽¹⁾

Interest
Income
Recognized
(in millions)
March 31, 2018:
With no related allowance recorded:
Commercial mortgage loans - other $ —
$ —
$ —
$ —
$ —
Agricultural mortgage loans —
—
—
—
—
Total $ —
$ —
$ —
$ —
$ —
With related allowance recorded:
Commercial mortgage loans - other $ 27
$ 27
$ (7 ) $ 27
$ —
Agricultural mortgage loans —
—
—
—
—
Total $ 27
$ 27
$ (7 ) $ 27
$ —
December 31, 2017:
With no related allowance recorded:
Commercial mortgage loans - other $ —
$ —
$ —
$ —
$ —
Agricultural mortgage loans —
—
—
—
—
Total $ —
$ —
$ —
$ —
$ —
With related allowance recorded:
Commercial mortgage loans - other $ 27
$ 27
$ (8 ) $ 27
$ 2
Agricultural mortgage loans —
—
—
—
—
Total $ 27
$ 27
$ (8 ) $ 27
$ 2


~~(1)~~	~~Represents a two-quarter average of recorded amortized cost.~~

~~Derivatives and Offsetting Assets and Liabilities~~4) DERIVATIVES

The Company uses derivatives as part of its overall asset/liability risk management primarily to reduce exposures to equity market and interest rate risks. Derivative hedging strategies are designed to reduce these risks from an economic perspective and are all executed within the framework of a ~~Derivative~~“Derivative Use ~~Plan (“DUP”)~~Plan” approved by applicable states’ insurance law. Derivatives are generally not accounted for using hedge accounting, with the exception of ~~Treasury Inflation-Protected Securities (“TIPS”),~~TIPS and cash flow hedges, which isare discussed further below. Operation of these hedging programs is based on models involving numerous estimates and assumptions, including, among others, mortality, lapse, surrender and withdrawal rates, election rates, fund performance, market volatility and interest rates. A wide range of derivative contracts are used in these hedging programs, including exchange traded equity, currency and interest rate futures contracts, total return and/or other equity swaps, interest rate swap and floor contracts, bond and bond-index total return swaps, swaptions, variance swaps and equity options, credit and foreign exchange derivatives, as well as bond and repo transactions to support the hedging. The derivative contracts are collectively managed in an effort to reduce the economic impact of unfavorable changes in guaranteed benefits’ exposures attributable to movements in capital markets. In addition, as part of ~~our~~its hedging strategy, the Company ~~holds static hedge positions to maintain a target~~targets an asset level for all variable annuity products at or above a CTE98 level under most economic scenarios (CTE is a statistical measure of tail risk which quantifies the total asset requirement to sustain a loss if an event outside a given probability level has

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

occurred. ~~CTE 98~~CTE98 denotes the financial resources a company would need to cover the average of the worst 2% of ~~scenarios).~~scenarios.)

Derivatives ~~utilized~~Utilized to ~~hedge exposure~~Hedge Exposure to Variable Annuities with Guarantee Features

The Company has issued and continues to offer variable annuity products with ~~variable annuity guaranteed benefits (“GMxB”), including guaranteed minimum living benefits (“GMLBs”) (such~~GMxB features which are accounted for as guaranteed minimum income benefits (“GMIBs”), guaranteed minimum withdrawal benefits (“GMWBs”) and guaranteed minimum accumulation benefits (“GMABs”), and guaranteed minimum death benefits (“GMDBs”) (inclusive of return of premium death benefit guarantees).market risk benefits. The risk associated with the GMDB feature is that under-performance of the financial markets could result in GMDB benefits, in the event of death, being higher than what accumulated policyholders’ account balances would support. The risk associated with the GMIB feature is that under-performance of the financial markets could result in the present value of GMIB, in the event of annuitization, being higher than what accumulated policyholders’ account balances would support, taking into account the relationship between current annuity purchase rates and the GMIB guaranteed annuity purchase rates. The risk associated with products that have a GMxB ~~derivative features liability~~feature and are accounted for as market risk benefits is that under-performance of the financial markets could result in the GMxB ~~derivative features’~~features benefits being higher than what accumulated policyholders’ account balances would support.

For GMxB features, the Company retains certain risks including basis, credit spread, and some volatility risk and risk associated with actual experience versus expected actuarial assumptions for mortality, lapse and surrender, withdrawal and policyholder election rates, among other things. The derivative contracts are managed to correlate with changes in the value of the GMxB features that result from financial markets movements. A portion of exposure to realized equity volatility is hedged using equity options and variance swaps and a portion of exposure to credit risk is hedged using total return swaps on fixed income indices. Additionally, the Company is party to total return swaps for which the reference U.S. Treasury securities are contemporaneously purchased from the market and sold to the swap counterparty. As these transactions result in a transfer of control of the U.S. Treasury securities to the swap counterparty, the Company derecognizes these securities with consequent gain or loss from the sale. The Company has also purchased reinsurance contracts to mitigate the risks associated with GMDB features and the impact of potential market fluctuations on future policyholder elections of GMIB features contained in certain annuity contracts issued by the Company. The reinsurance of the GMIB features is accounted for as purchased market risk benefits. In addition, on June 1, 2021, we ceded legacy variable annuity policies sold by Equitable Financial between 2006-2008 (the “Block”), comprised of non-New York “Accumulator” policies containing fixed rate GMIB and/or GMDB guarantees to CS Life. As this contract provides full risk transfer and thus has the same risk attributes as the underlying direct contracts, the benefits of this treaty are accounted for in the same manner as the underlying gross reserves and therefore the amounts due from reinsurers related to the GMIB with NLG are accounted for as purchased market risk benefits.

The Company has ~~implemented static~~in place an economic hedge ~~positions~~program using U.S. Treasury futures to ~~maintain a target asset level for all~~partially protect the overall profitability of future variable ~~annuities at a CTE98 level under most scenarios, and at a CTE95 level in extreme scenarios. This program was implemented beginning in December 2017.~~annuity sales against declining interest rates.

Derivatives ~~used~~Utilized to ~~hedge crediting rate exposure~~Hedge Crediting Rate Exposure on SCS, SIO, MSO and IUL ~~products/investment options~~Products/Investment Options

The Company hedges crediting rates in the ~~Structured Capital Strategies (“SCS”)~~SCS variable annuity, ~~Structured Investment Option~~SIO in the EQUI-VEST variable annuity series, ~~(“SIO”), Market Stabilizer Option (“MSO”)~~MSO in the variable life insurance products and ~~Indexed Universal Life (“IUL”)~~IUL insurance products. These products permit the contract owner to participate in the performance of an index, ETF or commodity price movement up to a cap for a set period of time. They also contain a protection feature, in which the Company will absorb, up to a certain percentage, the loss of value in an index, ETF or commodity price, which varies by product segment.

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

In order to support the returns associated with these features, the Company enters into derivative contracts whose payouts, in combination with fixed income investments, emulate those of the index, ETF or commodity price, subject to caps and buffers, ~~without any basis risk due to market exposures,~~ thereby substantially reducing any exposure to market-related earnings volatility.

Derivatives ~~used~~Used to Hedge Equity Market Risks Associated with the General Account’s Seed Money Investments in Retail Mutual Funds

The Company’s General Account seed money investments in retail mutual funds expose us to market risk, including equity market risk which is partially hedged through equity-index futures contracts to minimize such risk.

Derivatives Used for General Account Investment Portfolio

The Company maintains a strategy in its General Account investment portfolio to replicate the credit exposure of fixed maturity securities otherwise permissible for investment under its investment guidelines through the sale of ~~credit default swaps (“CDSs”).~~CDS. Under the terms of these swaps, the Company receives quarterly fixed premiums that, together with any initial amount paid or received at trade inception, replicate the credit spread otherwise currently obtainable

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

by purchasing the referenced entity’s bonds of similar maturity. These credit derivatives generally have remaining terms of five years or less and are recorded at fair value with changes in fair value, including the yield component that emerges from initial amounts paid or received, reported in ~~Net investment income (loss)~~net derivative gains (losses).

The Company manages its credit exposure taking into consideration both cash and derivatives based positions and selects the reference entities in its replicated credit exposures in a manner consistent with its selection of fixed maturities. In addition, the Company generally transacts the sale of ~~CDSs~~CDS in single name reference entities of investment grade credit quality and with counterparties subject to collateral posting requirements. If there is an event of default by the reference entity or other such credit event as defined under the terms of the swap contract, the Company is obligated to perform under the credit derivative and, at ~~the counterparty’s~~its option, either pay the referenced amount of the contract less an auction-determined recovery amount or pay the referenced amount of the contract and receive in return the defaulted or similar security of the reference entity for recovery by sale at the contract settlement auction. The Company purchased CDS to mitigate its exposure to a reference entity through cash positions. These positions do not replicate credit spreads.

To date, there have been no events of default or circumstances indicative of a deterioration in the credit quality of the named referenced entities to require or suggest that the Company will have to perform under ~~these CDSs.~~the CDS that it sold. The maximum potential amount of future payments the Company could be required to make under ~~these~~the credit derivatives sold is limited to the par value of the referenced securities which is the dollar or euro-equivalent of the ~~derivative~~derivative’s notional amount. The Standard North American CDS Contract ~~(“SNAC”)~~ or Standard European Corporate Contract ~~(“STEC”)~~ under which the Company executes these CDS sales transactions does not contain recourse provisions for recovery of amounts paid under the credit derivative.

The Company purchased 30-year TIPS and other sovereign bonds, both inflation linked and non-inflation linked, as General Account investments and enters into asset or cross-currency basis swaps, to result in payment of the given bond’s coupons and principal at maturity in the bond’s specified currency to the swap counterparty in return for fixed dollar amounts. These swaps, when considered in combination with the bonds, together result in a net position that is intended to replicate a dollar-denominated fixed-coupon cash bond with a yield higher than a term-equivalent U.S. Treasury bond. ~~At March 31, 2018 and December 31, 2017, the Company’s unrealized gains (losses) related~~

Derivatives Utilized to ~~this program were $(88) million and $(86) million, respectively, and reported in AOCI.~~Hedge Exposure to Foreign Currency Denominated Cash Flows

The Company ~~implemented a strategy to hedge a portion of~~purchases private placement debt securities and issues funding agreements in the ~~credit exposure~~FABN program in currencies other than its ~~General Account investment portfolio by buying protection through a swap. These are~~functional U.S. dollar currency. The Company enters into cross currency swaps ~~on the “super senior tranche” of the investment grade CDX index. Under the terms of these swaps, the Company pays quarterly fixed premiums that, together~~ with ~~any initial amount paid or received at trade inception, serve as premiums paid~~external counterparties to hedge the ~~risk arising~~exposure of the foreign currency denominated cash flows of these instruments. The foreign currency received from ~~multiple defaults of bonds referenced in the CDX index. These credit derivatives have terms of five years~~ or ~~less and are recorded at fair value with changes in fair value, including the yield component that emerges from initial amounts~~ paid ~~or received, reported in Net derivative gains (losses).~~

~~In 2016, the Company implemented a program to mitigate its duration gap using total return swaps for which the reference U.S. Treasury securities are sold~~ to the cross currency swap counterparty ~~under arrangements economically similar to repurchase agreements. As these~~is exchanged for fixed U.S. dollar amounts with improved net investment yields or net product costs over equivalent U.S. dollar denominated instruments issued at that time. The transactions ~~result~~are accounted for as cash flow hedges when they are designated in ~~a transfer of control of~~hedging relationships and qualify for hedge accounting.

These cross currency swaps are for the ~~U.S. Treasury~~period the foreign currency denominated private placement debt securities toand funding agreement are outstanding, with the swap counterparty, the Company derecognizes these securities with consequent gain or loss from the sale. Under this program the Company derecognized approximately $3,905 million U.S. Treasury securities for which the Company received proceeds of approximately $3,906 million at inception of the total return swap contract. Under the terms of these swaps, the Company retains ongoing exposure to the total returns of the underlying U.S. Treasury securities in exchange for a financing cost. At March 31, 2018, the aggregate fair value of U.S. Treasury securities derecognized under this program was approximately $3,673 million. Reported in Other invested assets in the Company’s balance sheet at March 31, 2018 is approximately $16 million, representing the fair value of the total return swap contracts.

~~Derivatives used to hedge currency fluctuations on affiliated loans~~

~~The Company uses foreign exchange derivatives to reduce exposure to currency fluctuations that may arise from non-U.S.-dollar denominated financial instruments. The Company has~~longest cross currency swap ~~contracts with AXA~~expiring in 2033. Since these cross currency swaps are designated and qualify as cash flow hedges, the corresponding interest accruals are recognized in net investment income and in interest credited to ~~hedge foreign exchange exposure from affiliated loans.~~

policyholders’ account balances.

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

The tables below present quantitative disclosures about the Company’s derivative instruments designated in hedging relationships and derivative instruments which have not been designated in hedging relationships, including those embedded in other contracts required to be accounted for as derivative instruments.

The following table presents the gross notional amount and estimated fair value of the Company’s derivatives:

Derivative Instruments by Category


	September 30, 2023								December 31, 2022
			Fair Value								Fair Value
	Notional Amount		Derivative Assets		Derivative Liabilities		Net Derivatives		Notional Amount		Derivative Assets		Derivative Liabilities		Net Derivatives
	(in millions)
Derivatives: designated for hedge accounting (1)
Cash flow hedges:
Currency swaps	$	2,140	$	86	$	87	$	(1)	$	1,431	$	99	$	85	$	14
Interest swaps	952		—		294		(294)		955		—		294		(294)
Total: designated for hedge accounting	3,092		86		381		(295)		2,386		99		379		(280)
Derivatives: not designated for hedge accounting (1)
Equity contracts:
Futures	8,481		3		—		3		5,151		2		—		2
Swaps	12,556		51		14		37		11,188		39		9		30
Options	47,628		10,336		2,718		7,618		40,122		7,583		3,412		4,171
Interest rate contracts:
Futures	6,449		—		—		—		12,693		—		—		—
Swaps	3,073		1		157		(156)		1,515		—		166		(166)
Credit contracts:
Credit default swaps	272		13		7		6		327		18		9		9
Currency contracts:
Currency swaps	721		38		—		38		397		4		13		(9)
Currency forwards	29		19		18		1		62		31		32		(1)
Other freestanding contracts:
Margin	—		470		—		470		—		226		—		226
Collateral	—		156		7,994		(7,838)		—		142		4,472		(4,330)
Total: not designated for hedge accounting	79,209		11,087		10,908		179		71,455		8,045		8,113		(68)

Embedded derivatives:
SCS, SIO, MSO and IUL indexed features (2)	—		—		7,905		(7,905)		—		—		4,164		(4,164)
Total embedded derivatives	—		—		7,905		(7,905)		—		—		4,164		(4,164)

Total derivative instruments	$	82,301	$	11,173	$	19,194	$	(8,021)	$	73,841	$	8,144	$	12,656	$	(4,512)

___________

(1)Reported in other invested assets in the consolidated balance sheets.

(2)Reported in policyholders’ account balances in the consolidated balance sheets.

At March 31, 2018
Gains (Losses)
Reported In Net
Income (Loss)
Three Months Ended March 31, 2018

Fair Value

Notional
Amount

Asset
Derivatives

Liability
Derivatives

(in millions)
Freestanding derivatives:
Equity contracts:⁽¹⁾

Futures $ 6,629
$ 2
$ 1
$ (23 )
Swaps 8,017
255
16
114
Options 23,013
3,350
1,411
(18 )
Interest rate contracts:⁽¹⁾

Swaps 29,331
555
395
(671 )
Futures 24,015
—
—
40
Credit contracts:⁽¹⁾

Credit default swaps 2,136
32
3
—
Other freestanding contracts:⁽¹⁾

Foreign currency contracts 1,781
10
52
(51 )
Margin —
62
57
—
Collateral —
17
2,208
—
Embedded derivatives:
GMIB reinsurance contracts⁽⁶⁾
—
1,734
—
(159 )
GMxB derivative features liability^(3,6)
—
—
3,977
460
SCS, SIO, MSO and IUL indexed features^(5,6)
—
—
1,683
27
Net derivative investment gains (loss) (281 )
Cross currency swaps ^(2,4)
—
—
—
9
Total $ 94,922
$ 6,017
$ 9,803
$ (272 )


~~(1)~~	~~Reported in Other invested assets in the consolidated balance sheets.~~


~~(2)~~	~~Reported in Other assets or Other liabilities in the consolidated balance sheets.~~


~~(3)~~	~~Reported in Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets.~~


~~(4)~~	~~Reported in Other income in the consolidated statements of income (loss).~~


~~(5)~~	SCS and SIO indexed features are reported in Policyholders’ account balances; MSO and IUL indexed features are reported in the Future policyholders’ benefits and other policyholders’ liabilities in the consolidated balance sheets.


~~(6)~~	~~Reported in Net derivative gains (losses) in the consolidated statements of income (loss).~~

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

The following table presents the effects of derivative instruments on the consolidated statements of income and comprehensive income (loss):

Derivative Instruments by Category


	Three Months Ended September 30, 2023								Nine Months Ended September 30, 2023
	Net Derivatives Gain (Losses) (1)		Net Investment Income		Interest Credited To Policyholders Account Balances		AOCI		Net Derivatives Gain (Losses) (1)		Net Investment Income		Interest Credited To Policyholders Account Balances		AOCI
	(in millions)
Derivatives: designated for hedge accounting
Cash flow hedges:
Currency swaps	$	(12)	$	2	$	8	$	14	$	(2)	$	8	$	(59)	$	41
Interest swaps	8		—		—		27		(13)		—		—		30
Total: designated for hedge accounting	(4)		2		8		41		(15)		8		(59)		71
Derivatives: not Designated for hedge accounting
Equity contracts:
Futures	(28)		—		—		—		(187)		—		—		—
Swaps	666		—		—		—		(645)		—		—		—
Options	(868)		—		—		—		3,133		—		—		—
Interest rate contracts:
Futures	26		—		—		—		36		—		—		—
Swaps	(288)		—		—		—		(297)		—		—		—
Credit contracts:
Credit default swaps	—		—		—		—		(5)		—		—		—
Currency contracts:
Currency swaps	28		—		—		—		9		—		—		—
Currency forwards	1		—		—		—		1		—		—		—
Other freestanding contracts:
Margin	—		—		—		—		—		—		—		—
Collateral	—		—		—		—		—		—		—		—
Total: not designated for hedge accounting	(463)		—		—		—		2,045		—		—		—

Embedded derivatives:
SCS, SIO,MSO and IUL indexed features	1,082		—		—		—		(3,173)		—		—		—
Total embedded derivatives	1,082		—		—		—		(3,173)		—		—		—

Total derivative instruments	$	615	$	2	$	8	$	41	$	(1,143)	$	8	$	(59)	$	71

______________

(1)Reported in net derivative gains (losses) in the consolidated statements of income (loss).

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

At December 31, 2017
Gains (Losses)
Reported In Net
Income (Loss)
Three Months Ended March 31, 2017

Fair Value

Notional
Amount

Asset
Derivatives

Liability
Derivatives

(in millions)
Freestanding derivatives:
Equity contracts:⁽¹⁾

Futures $ 6,716
$ 1
$ 2
$ (396 )
Swaps 7,623
4
201
(405 )
Options 22,223
3,456
1,457
318
Interest rate contracts:⁽¹⁾

Swaps 26,769
604
193
143
Futures 20,675
—
—
(19 )
Credit contracts:⁽¹⁾

Credit default swaps 2,131
35
3
6
Other freestanding contracts:⁽¹⁾

Foreign currency contracts 1,423
19
10
(1 )
Margin —
24
4
—
Collateral —
4
2,123
—
Embedded derivatives:
GMIB reinsurance contracts⁽⁶⁾
—
1,894
—
(71 )
GMxB derivative features liability^(3,6)
—
—
4,358
507
SCS, SIO, MSO and IUL indexed features^(5,6)
—
—
1,786
(317 )
Net derivative investment gains (loss) (235 )
Cross currency swaps^(2,4)
354
5
—
(7 )
Total $ 87,914
$ 6,046
$ 10,137
$ (242 )


~~(1)~~	~~Reported in Other invested assets in the consolidated balance sheets.~~


~~(2)~~	~~Reported in Other assets or Other liabilities in the consolidated balance sheets.~~


~~(3)~~	~~Reported in Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets.~~


~~(4)~~	~~Reported in Other income in the consolidated statements of income (loss).~~


~~(5)~~	SCS and SIO indexed features are reported in Policyholders’ account balances; MSO and IUL indexed features are reported in the Future policyholders’ benefits and other policyholders’ liabilities in the consolidated balance sheets.


~~(6)~~	~~Reported in Net derivative gains (losses) in the consolidated statements of income (loss).~~


	Three Months Ended September 30, 2022								Nine Months Ended September 30, 2022
	Net Derivatives Gain (Losses) (1)		Net Investment Income		Interest Credited To Policyholders Account Balances		AOCI		Net Derivatives Gain (Losses) (1)		Net Investment Income		Interest Credited To Policyholders Account Balances		AOCI
	(in millions)
Derivatives: designated for hedge accounting
Cash flow hedges:
Currency swaps	$	7	$	5	$	(36)	$	111	$	21	$	7	$	(46)	$	116
Interest swaps	(38)		—		—		94		(79)		—		—		242
Total: designated for hedge accounting	(31)		5		(36)		205		(58)		7		(46)		358
Derivatives: not Designated for hedge accounting
Equity contracts:
Futures	31		—		—		—		486		—		—		—
Swaps	596		—		—		—		3,374		—		—		—
Options	(649)		—		—		—		(4,379)		—		—		—
Interest rate contracts:
Futures	(428)		—		—		—		(1,486)		—		—		—
Swaps	(125)		—		—		—		(428)		—		—		—
Credit contracts:
Credit default swaps	(1)		—		—		—		13		—		—		—
Currency contracts:
Currency swaps	23		—		—		—		41		—		—		—
Currency forwards	2		—		—		—		5		—		—		—
Other freestanding contracts:
Margin	—		—		—		—		—		—		—		—
Collateral	—		—		—		—		—		—		—		—
Total: not designated for hedge accounting	(551)		—		—		—		(2,374)		—		—		—

Embedded derivatives:
SCS, SIO,MSO and IUL indexed features	781		—		—		—		4,648		—		—		—
Total embedded derivatives	781		—		—		—		4,648		—		—		—

Total derivative instruments	$	199	$	5	$	(36)	$	205	$	2,216	$	7	$	(46)	$	358

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The following table presents a roll-forward of cash flow hedges recognized in AOCI:

Roll-forward of Cash flow hedges in AOCI


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Balance, beginning of period	$	52	$	(55)	$	22	$	(208)
Amount recorded in AOCI
Currency swaps	(17)		77		(12)		77
Interest swaps	31		51		4		149
Total amount recorded in AOCI	14		128		(8)		226
Amount reclassified from income to AOCI
Currency swaps (1)	31		34		53		39
Interest swaps (1)	(4)		43		26		93
Total amount reclassified from income to AOCI	27		77		79		132
Balance, end of period (2)	$	93	$	150	$	93	$	150

_______________

(1) Currency swaps income is reported in net investment income in the consolidated statements of income (loss). Interest swaps income is reported in net derivative gains (losses) in the consolidated statements of income (loss).

(2) The Company does not estimate the amount of the deferred losses in AOCI at September 30, 2023 and 2022 which will be released and reclassified into net income (loss) over the next 12 months as the amounts cannot be reasonably estimated.

Equity-Based and Treasury Futures Contracts Margin

All outstanding equity-based and treasury futures contracts ~~at March~~as of September 30, 2023 and December 31, ~~2018~~2022 are exchange-traded and net settled daily in cash. ~~At March~~As of September 30, 2023 and December 31, ~~2018,~~2022, respectively, the Company had open exchange-traded futures positions on: (i) the S&P 500, Nasdaq, Russell 2000 and Emerging Market indices, having initial margin requirements of ~~$250~~$391 million and $247 million, (ii) the 2-year, 5-year and 10-year U.S. Treasury Notes on U.S. Treasury bonds and ultra-long bonds, having initial margin requirements of ~~$67~~$96 million and $113 million, and (iii) the Euro Stoxx, FTSE 100, Topix, ASX 200 and ~~European, Australasia, and Far East (“EAFE”)~~EAFE indices as well as corresponding currency futures on the Euro/U.S. dollar, Pound/U.S. dollar, Australian dollar/U.S. dollar, and Yen/U.S. dollar, having initial margin requirements of ~~$24~~$14 million and $16 million.

Collateral Arrangements

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~Credit Risk~~

Although notional amount is the most commonly used measure of volume in the derivatives market, it is not used as a measure of credit risk. A derivative with positive fair value (a derivative asset) indicates existence of credit risk because the counterparty would owe money to the Company if the contract were closed at the reporting date. Alternatively, a derivative contract with negative fair value (a derivative liability) indicates the Company would owe money to the counterparty if the contract were closed at the reporting date. To reduce credit exposures in Over-the-Counter (“OTC”) derivative transactions the Company generally enters into master agreements that provide for a netting of financial exposures with the counterparty and allow for collateral arrangements as further described below under “ISDA Master Agreements.” The Company further controls and minimizes its counterparty exposure through a credit appraisal and approval process.

~~ISDA Master Agreements~~

~~Netting Provisions.~~ The standardized ISDA Master Agreement under which the Company conducts its OTC derivative transactions includes provisions for payment netting. In the normal course of business activities, if there is more than one derivative transaction with a single counterparty, the Company will set-off the cash flows of those derivatives into a single amount to be exchanged in settlement of the resulting net payable or receivable with that counterparty. In the event of default, insolvency, or other similar event pre-defined under the ISDA Master Agreement that would result in termination of OTC derivatives transactions before their maturity, netting procedures would be applied to calculate a single net payable or receivable with the counterparty.

~~Collateral Arrangements.~~ The Company generally has executed a CSA under the ISDA Master Agreement it maintains with each of its OTC derivative counterparties that requires both posting and accepting collateral either in the form of cash or high-quality securities, such as U.S. Treasury securities, U.S. government and government agency securities and investment grade corporate bonds. These CSAs are bilateral agreements that require collateral postings by the party “out-of-the-money” or in a net derivative liability position. Various thresholds for the amount and timing of collateralization of net liability positions are applicable. Consequently, the credit exposure of the Company’s OTC derivative contracts is limited to the net positive estimated fair value of those contracts at the reporting date after taking into consideration the existence of netting agreements and any collateral received pursuant to CSAs. Derivatives are recognized at fair value in the consolidated balance sheets and are reported either as assets in Other invested assets or as liabilities in Other liabilities, except for embedded insurance-related derivatives as described above and derivatives transacted with a related counterparty. The Company nets the fair value of all derivative financial instruments with counterparties for which an ISDA Master Agreement and related CSA have been executed.

~~At March 31, 2018~~ As of September 30, 2023 and December 31, ~~2017,~~2022, respectively, the Company held ~~$2,208 million~~$8.0 billion and ~~$2,123 million~~$4.5 billion in cash and securities collateral delivered by trade counterparties, representing the fair value of the related derivative agreements. The unrestricted cash collateral is reported in ~~Other~~other invested assets. The aggregate fair value of all collateralized derivative transactions that were in a liability position with trade counterparties at March 31, 2018 and December 31, 2017, respectively, were $2 million and $2 million, for which the Company posted collateral of $7$156 million and $4$142 million ~~at March 31, 2018~~as of September 30, 2023 and December 31, ~~2017,~~2022, respectively, in the normal operation of its collateral arrangements. ~~Certain of the Company’s ISDA Master Agreements contain contingent provisions that permit the counterparty~~The Company is exposed to terminate the ISDA Master Agreement if the Company’s credit rating falls below a specified threshold, however, the occurrence of such credit event would not impose additional collateral requirements.

~~Margin~~

Effective January 3, 2017, the CME amended its rulebook, resulting in the characterization of variation margin transfers as settlement payments, as opposed to adjustments to collateral. These amendments impacted the accounting treatment of the Company’s centrally cleared derivatives for which the CME serves as the central clearing party. As of the effective date, the application of the amended rulebook reduced gross derivative assets by $1 million.

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~Securities Repurchase and Reverse Repurchase Transactions~~

Securities repurchase and reverse repurchase transactions are conducted by the Company under a standardized securities industry master agreement, amended to suit the specificities of each respective counterparty. These agreements generally provide detail as to the nature of the transaction, including provisions for payment netting, establish parameters concerning the ownership and custody of the collateral securities, including the right to substitute collateral during the term of the agreement, and provide for remedieslosses in the event of ~~default~~non-performance by ~~either party. Amounts due to/~~counterparties to financial derivative transactions with a positive fair value. The Company manages credit risk by: (i) entering into derivative transactions with highly rated major international financial institutions and other creditworthy counterparties governed by master netting agreements, as applicable; (ii) trading through central clearing and OTC parties; (iii) obtaining collateral, such as cash and securities, when appropriate; and (iv) setting limits on single party credit exposures which are subject to periodic management review.

Substantially all of the Company’s derivative agreements have zero thresholds which require daily full collateralization by the party in a liability position. In addition, certain of the Company’s derivative agreements contain credit-risk related contingent features; if the credit rating of one of the parties to the derivative agreement is to fall below a certain level, the party with positive fair value could request termination at the then fair value or demand immediate full collateralization from the ~~same counterparty under these arrangements generally would be netted~~party whose credit rating fell and is in ~~the event~~a net liability position.

As of default and subject to rights of set-off in bankruptcy. The Company’s securities repurchase and reverse repurchase agreements are accounted for as secured borrowing or lending arrangements, respectively and are reported in the consolidated balance sheets on a gross basis. The Company obtains or posts collateral generally in the form of cash and U.S. Treasury, corporate and government agency securities. The fair value of the securities to be repurchased or resold is monitored on a daily basis with additional collateral posted or obtained as necessary. Securities to be repurchased or resold are the same, or substantially the same, as those initially transacted under the arrangement. At March 31, 2018September 30, 2023 and December 31, ~~2017,~~2022, there were no net liability derivative positions with counterparties with credit risk-related contingent features whose credit rating has fallen. All derivatives have been appropriately collateralized by the ~~balance outstanding under securities repurchase transactions was $1,904 million and $1,887 million, respectively. The~~ Company utilized these repurchase and reverse repurchase agreements for asset liability and cash management purposes. For other instruments used for asset liability management purposes, see “Obligation under funding agreements” includedor the counterparty in ~~Note 14.~~

~~Table~~accordance with the terms of ~~Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

the derivative agreements.

The following ~~table~~tables presents information about the Company’s offsetting of financial assets and liabilities and derivative ~~instruments at March 31, 2018.~~instruments:

Offsetting of Financial Assets and Liabilities and Derivative Instruments

~~At March~~As of September 30, 2023


	Gross Amount Recognized		Gross Amount Offset in the Balance Sheets		Net Amount Presented in the Balance Sheets		Gross Amount not Offset in the Balance Sheets (3)		Net Amount
	(in millions)
Assets:
Derivative assets (1)	$	11,173	$	7,532	$	3,641	$	(3,137)	$	504
Secured lending	113		—		113		—		113
Other financial assets	2,326		—		2,326		—		2,326
Other invested assets	$	13,612	$	7,532	$	6,080	$	(3,137)	$	2,943

Liabilities:
Derivative liabilities (2)	$	8,151	$	7,532	$	619	$	—	$	619
Secured lending	113		—		$	113	—		113
Other financial liabilities	6,680		—		6,680		—		6,680
Other liabilities	$	14,944	$	7,532	$	7,412	$	—	$	7,412

______________

(1)Excludes Investment Management and Research segment’s derivative assets of consolidated VIEs/VOEs.

(2)Excludes Investment Management and Research segment’s derivative liabilities of consolidated VIEs/VOEs.

(3)Financial instruments/collateral sent (held).

As of December 31, ~~2018~~2022


	Gross Amount Recognized		Gross Amount Offset in the Balance Sheets		Net Amount Presented in the Balance Sheets		Gross Amount not Offset in the Balance Sheets (3)		Net Amount
	(in millions)
Assets:
Derivative assets (1)	$	8,143	$	7,047	$	1,096	$	(848)	$	248

Other financial assets	2,789		—		2,789		—		2,789
Other invested assets	$	10,932	$	7,047	$	3,885	$	(848)	$	3,037

Liabilities:
Derivative liabilities (2)	$	7,645	$	7,047	$	598	$	—	$	598

Other financial liabilities	6,510		—		6,510		—		6,510
Other liabilities	$	14,155	$	7,047	$	7,108	$	—	$	7,108

______________

(1)Excludes Investment Management and Research segment’s derivative assets of consolidated VIEs/VOEs.

(2)Excludes Investment Management and Research segment’s derivative liabilities of consolidated VIEs/VOEs.

(3)Financial instruments sent (held).

Gross
Amounts
Recognized

Gross
Amounts
Offset in the
Balance Sheets

Net Amounts
Presented in the
Balance Sheets
(in millions)
ASSETS⁽¹⁾

Description
Derivatives:
Equity contracts $ 3,606
$ 1,429
$ 2,177
Interest rate contracts 555
395
160
Credit contracts 32
3
29
Currency 10
52
(42 )
Collateral 17
2,208
(2,191 )
Margin 62
57
5
Total Derivatives, subject to an ISDA Master Agreement 4,282
4,144
138
Other financial instruments 3,923
—
3,923
Other invested assets $ 8,205
$ 4,144
$ 4,061
LIABILITIES⁽²⁾

Description
Derivatives:
Equity contracts $ 1,429
$ 1,429
$ —
Interest rate contracts 395
395
—
Credit contracts 3
3
—
Currency 52
52
—
Collateral 2,208
2,208
—
Margin 57
57
—
Total Derivatives, subject to an ISDA Master Agreement 4,144
4,144
—
Other financial liabilities 4,342
—
4,342
Other liabilities $ 8,486
$ 4,144
$ 4,342
Securities sold under agreement to repurchase⁽³⁾
$ 1,897
$ —
$ 1,897


~~(1)~~	~~Excludes Investment Management and Research segment’s derivative assets of consolidated VIEs/VOEs.~~


~~(2)~~	~~Excludes Investment Management and Research segment’s derivative liabilities of consolidated VIEs/VOEs.~~


~~(3)~~	~~Excludes expense of $7 million in securities sold under agreement to repurchase.~~

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

5) CLOSED BLOCK

~~The following table presents information about~~

As a result of demutualization, the Company’s ~~gross collateral amounts~~Closed Block was established in 1992 for the benefit of certain individual participating policies that were in force on that date. Assets, liabilities and earnings of the Closed Block are specifically identified to support its participating policyholders.

Assets allocated to the Closed Block insure solely to the benefit of the Closed Block policyholders and will not ~~offset in~~revert to the ~~consolidated balance sheets at March 31, 2018.~~

~~Collateral Amounts Offset in~~benefit of the ~~Consolidated Balance Sheets~~

~~At March 31, 2018~~

Net Amounts
Presented in the
Balance Sheets Collateral (Received)/Held

Financial
Instruments
Cash
Net
Amounts
(in millions)
Assets⁽¹⁾

Total derivatives $ 2,324
$ —
$ (2,186 ) $ 138
Other financial instruments 3,923
—
—
3,923
Other invested assets $ 6,247
$ —
$ (2,186 ) $ 4,061
Liabilities:⁽²⁾

Securities sold under agreement to repurchase^(3)(4)(5)
$ 1,897
$ (1,923 ) $ —
$ (26 )


~~(1)~~	~~Excludes Investment Management and Research segment’s derivative~~Company. No reallocation, transfer, borrowing or lending of assets can be made between the Closed Block and other portions of ~~consolidated VIEs/VOEs.~~


~~(2)~~	~~Excludes Investment Management and Research segment’s derivative liabilities of consolidated VIEs/VOEs.~~


~~(3)~~	~~Excludes expense of $7 million included in Securities sold under agreements to repurchase on the consolidated balance sheet.~~


~~(4)~~	~~US Treasury and agency securities are included in Fixed maturities available for sale on the consolidated balance sheet.~~


~~(5)~~	~~Cash is reported in Cash and cash equivalents on the consolidated balance sheet.~~

~~The following table presents information about repurchase agreements accounted for as secured borrowings in the consolidated balance sheets at March 31, 2018.~~

~~Repurchase Agreement Accounted for as Secured Borrowings~~

At March 31, 2018
Remaining Contractual Maturity of the Agreements

Overnight and
Continuous

Up to 30
days

30–90
days

Greater Than
90 days
Total
(in millions)
Securities sold under agreement to repurchase⁽¹⁾

U.S. Treasury and agency securities $ —
$ 1,897
$ —
$ —
$ 1,897
Total $ —
$ 1,897
$ —
$ —
$ 1,897


~~(1)~~	~~Excludes expense accrual of $7 million included in Securities sold under agreements to repurchase on the consolidated balance sheet.~~

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~The following table presents information about~~ the Company’s ~~offsetting financial~~General Account, any of its Separate Accounts or any affiliate of the Company without the approval of the New York State Department of Financial Services (the “NYDFS”). Closed Block assets and liabilities are carried on the same basis as similar assets and ~~derivative instruments at December 31, 2017.~~

~~Offsetting of Financial Assets and Liabilities and Derivative Instruments~~

~~At December 31, 2017~~

Gross
Amounts
Recognized

Gross
Amounts
Offset in the
Balance Sheets

Net Amounts
Presented in the
Balance Sheets
(in millions)
ASSETS⁽¹⁾

Description
Derivatives:
Equity contracts $ 3,461
$ 1,660
$ 1,801
Interest rate contracts 604
193
411
Credit contracts 35
3
32
Currency 19
10
9
Collateral 4
2,123
(2,119 )
Margin 24
4
20
Total Derivatives, subject to an ISDA Master Agreement 4,147
3,993
154
Other financial instruments 3,964
—
3,964
Other invested assets $ 8,111
$ 3,993
$ 4,118
Total Derivatives, not subject to an ISDA Master Agreement⁽⁴⁾
$ 5
$ —
$ 5
LIABILITIES⁽²⁾

Description
Derivatives:
Equity contracts $ 1,660
$ 1,660
$ —
Interest rate contracts 193
193
—
Credit contracts 3
3
—
Currency 10
10
—
Collateral 2,123
2,123
—
Margin 4
4
—
Total Derivatives, subject to an ISDA Master Agreement 3,993
3,993
—
Other financial liabilities 4,053
—
4,053
Other liabilities $ 8,046
$ 3,993
$ 4,053
Securities sold under agreement to repurchase⁽³⁾
$ 1,882
$ —
$ 1,882


~~(1)~~	~~Excludes Investment Management and Research segment’s derivative assets of consolidated VIEs/VOEs.~~


~~(2)~~	~~Excludes Investment Management and Research segment’s derivative liabilities of consolidated VIEs/VOEs.~~


~~(3)~~	~~Excludes expense of $5 million included in Securities sold under agreements to repurchase on the consolidated balance sheets.~~


~~(4)~~	~~This amount is reflected in Other assets.~~

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~The following table presents information about the Company’s gross collateral amounts that are not offset~~liabilities held in the General Account. For more information on the Closed Block, see Note 6 to the Company's consolidated ~~balance sheet at December 31, 2017.~~

~~Collateral Amounts Offset~~financial statements included in the ~~Consolidated Balance Sheets~~Recast 2022 Annual Report.

~~At December 31, 2017~~

Net Amounts Presented in the Balance Sheets Collateral (Received)/Held

Financial
Instruments
Cash
Net
Amounts
(in millions)
Assets⁽¹⁾

Total Derivatives $ 2,253
$ —
$ (2,099 ) $ 154
Other financial assets 3,964
—
—
3,964
Other invested assets $ 6,217
$ —
$ (2,099 ) $ 4,118
Liabilities:⁽²⁾

Other financial liabilities $ 4,053
$ —
$ —
$ 4,053
Other liabilities $ 4,053
$ —
$ —
$ 4,053
Securities sold under agreement to repurchase^(3)(4)(5)
$ 1,882
$ (1,988 ) $ (21 ) $ (127 )


~~(1)~~	~~Excludes Investment Management and Research segment’s derivative assets of consolidated VIEs/VOEs.~~


~~(2)~~	~~Excludes Investment Management and Research segment’s derivative liabilities of consolidated VIEs/VOEs.~~


~~(3)~~	~~Excludes expense of $5 million in securities sold under agreement to repurchase.~~


~~(4)~~	~~US Treasury and agency securities are in fixed maturities available for sale on consolidated balance sheet.~~


~~(5)~~	~~Cash is included in cash and cash equivalents on consolidated balance sheet.~~

~~The following table presents information about repurchase agreements accounted for as secured borrowings in the consolidated balance sheets at December 31, 2017.~~

~~Repurchase Agreement Accounted for as Secured Borrowings~~

At December 31, 2017
Remaining Contractual Maturity of the Agreements

Overnight and
Continuous

Up to 30
days

30–90
days

Greater
Than
90 days
Total
(in millions)
Securities sold under agreement to repurchase⁽¹⁾

U.S. Treasury and agency securities $ —
$ 1,882
$ —
$ —
$ 1,882
Total $ —
$ 1,882
$ —
$ —
$ 1,882


~~(1)~~	~~Excludes expense of $5 million in securities sold under agreement to repurchase.~~

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~4) CLOSED BLOCK~~

Summarized financial information for the Company’s Closed Block is as follows:



	September 30, 2023		December 31, 2022
	(in millions)
Closed Block Liabilities:
Future policy benefits, policyholders’ account balances and other	$	5,508	$	5,692
Policyholder dividend obligation	—		—
Other liabilities	110		68
Total Closed Block liabilities	5,618		5,760

Assets Designated to the Closed Block:
Fixed maturities AFS, at fair value (amortized cost of $3,062 and $3,171) (allowance for credit losses of $0 and $0)	2,804		2,948
Mortgage loans on real estate (net of allowance for credit losses of $11 and $4)	1,622		1,645
Policy loans	555		569
Cash and other invested assets	6		—
Other assets	193		187
Total assets designated to the Closed Block	5,180		5,349

Excess of Closed Block liabilities over assets designated to the Closed Block	438		411
Amounts included in AOCI:
Net unrealized investment gains (losses), net of policyholders’ dividend obligation: $0 and $0; and net of income tax: $54 and $47	(203)		(177)
Maximum future earnings to be recognized from Closed Block assets and liabilities	$	235	$	234

March 31,
2018 December 31,
2017
(in millions)
CLOSED BLOCK LIABILITIES:
Future policy benefits, policyholders’ account balances and other $ 6,904
$ 6,958
Policyholder dividend obligation —
19
Other liabilities 269
271
Total Closed Block liabilities 7,173
7,248
ASSETS DESIGNATED TO THE CLOSED BLOCK:
Fixed maturities, available for sale, at fair value (amortized cost of $3,864 and $3,923) 3,908
4,070
Mortgage loans on real estate 1,837
1,720
Policy loans 772
781
Cash and other invested assets 235
351
Other assets 192
182
Total assets designated to the Closed Block 6,944
7,104
Excess of Closed Block liabilities over assets designated to the Closed Block 229
144
Amounts included in accumulated other comprehensive income (loss):
Net unrealized investment gains (losses), net of policyholder dividend obligation of $0 and $19 55
138
Maximum Future Earnings To Be Recognized From Closed Block Assets and Liabilities $ 284
$ 282

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The Company’s Closed Block revenues and expenses were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Revenues:
Premiums and other income	$	27	$	29	$	86	$	93
Net investment income (loss)	53		52		156		164
Investment gains (losses), net	(6)		(2)		(6)		(2)
Total revenues	74		79		236		255

Benefits and Other Deductions:
Policyholders’ benefits and dividends	79		93		237		249
Other operating costs and expenses	—		—		—		—
Total benefits and other deductions	79		93		237		249
Net income (loss), before income taxes	(5)		(14)		(1)		6
Income tax (expense) benefit	2		1		—		(1)
Net income (loss)	$	(3)	$	(13)	$	(1)	$	5

Three Months Ended March 31,
2018 2017
(in millions)
REVENUES:
Premiums and other income $ 51
$ 54
Net investment income (loss) 73
83
Net investment gains (losses) 1
(15 )
Total revenues 125
122
BENEFITS AND OTHER DEDUCTIONS:
Policyholders’ benefits and dividends 126
151
Other operating costs and expenses 1
—
Total benefits and other deductions 127
151
Net revenues (loss) before income taxes (2 ) (29 )
Income tax (expense) benefit —
10
Net Revenues (Losses) $ (2 ) $ (19 )

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

6) DAC AND OTHER DEFERRED ASSETS/LIABILITIES

~~A reconciliation~~Changes in the DAC asset were as follows:


	Nine Months Ended September 30, 2023
	Protection Solutions								Individual Retirement								Legacy		Group Retirement				Corporate and Other		Total
	Term		UL		VUL		IUL		GMxB Core		EI		IE		SCS		GMxB Legacy		EG		Momentum		CB (1)
	(in millions)
Balance, beginning of period	$	362	$	179	$	889	$	185	$	1,625	$	156	$	148	$	1,279	$	593	$	710	$	89	$	127	$	6,342
Capitalization	11		5		109		10		87		8		30		364		19		51		7		—		701
Amortization (2)	(29)		(9)		(42)		(8)		(107)		(9)		(11)		(154)		(48)		(31)		(13)		(8)		(469)
Balance, end of period	$	344	$	175	$	956	$	187	$	1,605	$	155	$	167	$	1,489	$	564	$	730	$	83	$	119	$	6,574

______________

(1)“CB” defined as Closed Block.

(2)DAC amortization of $3 million related to Other not reflected in table above.


	Nine Months Ended September 30, 2022
	Protection Solutions								Individual Retirement								Legacy		Group Retirement				Corporate and Other		Total
	Term		UL		VUL		IUL		GMxB Core		EI		IE		SCS		GMxB Legacy		EG		Momentum		CB (1)
	(in millions)
Balance, beginning of period	$	385	$	180	$	799	$	180	$	1,653	$	156	$	121	$	1,070	$	631	$	677	$	94	$	138	$	6,084
Capitalization	14		9		106		12		85		10		31		287		25		55		11		—		645
Amortization (2)	(31)		(9)		(38)		(8)		(102)		(10)		(10)		(124)		(49)		(31)		(14)		(8)		(434)
Balance, end of period	$	368	$	180	$	867	$	184	$	1,636	$	156	$	142	$	1,233	$	607	$	701	$	91	$	130	$	6,295

______________

(1)“CB” defined as Closed Block.

(2)DAC amortization of $2 million related to Other not reflected in table above.

Changes in the ~~Company’s policyholder dividend obligation~~Individual Retirement sales inducement assets were as follows:

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Three Months Ended March 31,
2018 2017
(in millions)
Balances, beginning of year $ 19
$ 52
Unrealized investment gains (losses), net of DAC (19 ) (14 )
Balances, End of Period $ —
$ 38


	Nine Months Ended September 30,
	2023				2022
	GMxB Core		GMxB Legacy		GMxB Core		GMxB Legacy
	(in millions)

Balance, beginning of period	$	137	$	200	$	147	$	222
Capitalization	2		—		2		—
Amortization	(9)		(16)		(9)		(17)
Balance, end of period	$	130	$	184	$	140	$	205

Changes in the Protection Solutions unearned revenue liability were as follows:

~~5) INSURANCE LIABILITIES~~


	Nine Months Ended September 30,
	2023						2022
	UL		VUL		IUL		UL		VUL		IUL
	(in millions)

Balance, beginning of period	$	95	$	684	$	157	$	80	$	619	$	94
Capitalization	14		86		49		16		77		54
Amortization	(5)		(34)		(8)		(4)		(30)		(5)
Balance, end of period	$	104	$	736	$	198	$	92	$	666	$	143

~~A) Variable Annuity Contracts – GMDB, GMIB, GIB and GWBL and Other Features~~

~~The Company has certain variable annuity contracts with GMDB, GMIB, GIB and GWBL and other features in-force that guarantee one of the following:~~

~~Return of Premium: the benefit is the greater of current account value or premiums paid (adjusted for withdrawals);~~

Ratchet: the benefit is the greatest of current account value, premiums paid (adjusted for withdrawals), or the highest account value on any anniversary up to contractually specified ages (adjusted for withdrawals);

~~Roll-Up: the benefit is the greater of current account value or premiums paid (adjusted for withdrawals) accumulated at contractually specified interest rates up to specified ages;~~

~~Combo: the benefit is the greater of the ratchet benefit or the roll-up benefit, which may include either a five year or an annual reset; or~~

~~Withdrawal: the withdrawal is guaranteed up to a maximum amount per year for life.~~

The following table ~~summarizes the direct GMDB and GMIB with no no-lapse guarantee rider (“NLG”) features liabilities, before reinsurance ceded, reflected in~~presents a reconciliation of DAC to the consolidated balance ~~sheets in Future policy benefits~~sheets:



	September 30, 2023		December 31, 2022
	(in millions)
Protection Solutions
Term	$	344	$	362
Universal Life	175		179
Variable Universal Life	956		889
Indexed Universal Life	187		185
Individual Retirement
GMxB Core	1,605		1,625
EQUI-VEST Individual	155		156
Investment Edge	167		148
SCS	1,489		1,279
Legacy Segment
GMxB Legacy	564		593
Group Retirement
EQUI-VEST Group	730		710
Momentum	83		89
Corporate and Other	119		127
Other	25		27
Total	$	6,599	$	6,369

Annually, or as circumstances warrant, we review the associated decrements assumptions (i.e., mortality and lapse) based on our multi-year average of companies experience with actuarial judgements to reflect other ~~policyholders’ liabilities:~~observable industry trends. In addition to DAC, the unearned revenue liability and sales inducement asset (“SIA”) use similar techniques and quarterly update processes for balance amortization.

GMDB GMIB Total
(in millions)
Balance at January 1, 2018 $ 4,085
$ 4,800
$ 8,885
Paid guarantee benefits (101 ) (32 ) (133 )
Other changes in reserve 97
(136 ) (39 )
Balance at March 31, 2018 $ 4,081
$ 4,632
$ 8,713
Balance at January 1, 2017 $ 3,170
$ 3,868
$ 7,038
Paid guarantee benefits (89 ) (32 ) (121 )
Other changes in reserve 187
1,919
2,106
Balance at March 31, 2017 $ 3,268
$ 5,755
$ 9,023

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

~~The following table summarizes the ceded GMDB liabilities, reflected in the consolidated balance sheets in Amounts due from reinsurers:~~

Three Months Ended March 31,
2018 2017
(in millions)
Balance, beginning of year $ 108
$ 90
Paid guarantee benefits (5 ) (3 )
Other changes in reserve 2
2
Balance, End of Period $ 105
$ 89

~~The following table summarizes the assumed GMDB liabilities, reflected in the consolidated balance sheets in Future policy benefits and other policyholders’ liabilities:~~

Three Months Ended March 31,
2018 2017
(in millions)
Balance, beginning of year $ 95
$ 121
Paid guarantee benefits (6 ) (5 )
Other changes in reserve (7 ) (8 )
Balance, End of Period $ 82
$ 108

The liability for the GMxB derivative features liability, the liability for SCS, SIO, MSO and IUL indexed features and the GMIB reinsurance contract asset are considered embedded or freestanding insurance derivatives and are reported at fair value. Summarized in the table below is a summary of the fair value of these liabilities at March 31, 2018 and December 31, 2017:

March 31,
2018 December 31,
2017
(in millions)

GMIBNLG⁽¹⁾
$ 3,715
$ 4,056
SCS, SIO, MSO, IUL indexed features⁽²⁾
1,683
1,786
Assumed GMIB reinsurance Contracts⁽¹⁾
173
194
GWBL/GMWB⁽¹⁾
121
130
GIB⁽¹⁾
(36 ) (27 )
GMAB⁽¹⁾
4
5
Total embedded and freestanding derivative liabilities $ 5,660
$ 6,144

GMIB reinsurance contract asset⁽³⁾
$ 1,734
$ 1,894


~~(1)~~	~~Reported in Future policyholders’ benefits and other policyholders’ liabilities in the consolidated balance sheets.~~


~~(2)~~	~~Reported in Policyholders’ account balances in the consolidated balance sheets.~~


~~(3)~~	~~Reported in GMIB reinsurance contract asset, at fair value in the consolidated balance sheets.~~

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

The March 31, 2018 values for direct variable annuity contracts in-force on such date with GMDB and GMIB features are presented in the following table. For contracts with the GMDB feature, the net amount at risk in the event of death is the amount by which the GMDB exceed related account values. For contracts with the GMIB feature, the net amount at risk in the event of annuitization is the amount by which the present value of the GMIB benefits exceeds related account values, taking into account the relationship between current annuity purchase rates and the GMIB guaranteed annuity purchase rates. Since variable annuity contracts with GMDB guarantees may also offer GMIB guarantees in the same contract, the GMDB and GMIB amounts listed are not mutually exclusive:

~~Direct Variable Annuity Contract Values~~

Return of
Premium
Ratchet Roll-Up Combo Total
(Dollars in millions)
GMDB:
Account values invested in:
General Account $ 13,848
$ 107
$ 64
$ 194
$ 14,213
Separate Accounts $ 45,136
$ 9,319
$ 3,381
$ 34,668
$ 92,504
Net amount at risk, gross $ 186
$ 117
$ 2,016
$ 16,388
$ 18,707
Net amount at risk, net of amounts reinsured $ 186
$ 111
$ 1,378
$ 16,388
$ 18,063
Average attained age of policyholders 51
67
73
68
55
Percentage of policyholders over age 70 9.7 % 40.9 % 63.7 % 47.4 % 18.3 %
Range of contractually specified interest rates N/A
N/A
3%-6%
3%-6.5%
3%-6.5%
GMIB:
Account values invested in:
General Account N/A
N/A
$ 24
$ 285
$ 309
Separate Accounts N/A
N/A
$ 20,855
$ 39,604
$ 60,459
Net amount at risk, gross N/A
N/A
$ 883
$ 6,322
$ 7,205
Net amount at risk, net of amounts reinsured N/A
N/A
$ 268
$ 5,738
$ 6,006
Average attained age of policyholders N/A
N/A
70
69
69
Weighted average years remaining until annuitization N/A
N/A
1.7
0.7
0.8
Range of contractually specified interest rates N/A
N/A
3%-6%
3%-6.5%
3%-6.5%

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~The March 31, 2018 values for assumed variable annuity contracts in force on such date with GMDB and GMIB features are presented in the following table:~~

~~Assumed Variable Annuity Contract Values~~

Return of
Premium
Ratchet Roll-Up Combo Total
(Dollars in millions)
GMDB:
Reinsured Account values $ 1,023
$ 5,849
$ 302
$ 1,879
$ 9,053
Net amount at risk assumed $ 7
$ 314
$ 24
$ 321
$ 666
Average attained age of policyholders 67
72
77
75
72
Percentage of policyholders over age 70 41.4 % 60.8 % 76.6 % 74.2 % 61.9 %
Range of contractually specified interest rates N/A
N/A
3%-10%
5%-10%
3%-10%
GMIB:
Reinsured Account values $ 978
$ 52
$ 277
$ 1,338
$ 2,645
Net amount at risk assumed $ 2
$ —
$ 38
$ 215
$ 255
Average attained age of policyholders 71
74
71
68
70
Percentage of policyholders over age 70 61.6 % 63.7 % 55.9 % 48.1 % 54.2 %
Range of contractually specified interest rates⁽¹⁾
N/A
N/A
3.3%-6.5%
6%-6%
3.3%-6.5%


~~(1)~~	~~In general, for policies with the highest contractual interest rate shown (10%), the rate applied only for the first 10 years after issue, which have now elapsed.~~

~~B) Separate Account Investments by Investment Category Underlying GMDB and GMIB Features~~

The total account values of variable annuity contracts with GMDB and GMIB features include amounts allocated to the guaranteed interest option, which is part of the General Account and variable investment options that invest through Separate Accounts in variable insurance trusts. The following table presents the aggregate fair value of assets, by major investment category, held by Separate Accounts that support variable annuity contracts with GMDB and GMIB guarantees. The investment performance of the assets impacts the related account values and, consequently, the net amount of risk associated with the GMDB and GMIB benefits and guarantees. Because variable annuity contracts offer both GMDB and GMIB features, GMDB and GMIB amounts are not mutually exclusive.

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~Investment in Separate Account Investment Options~~

March 31,
2018 December 31, 2017 (1)
(in millions)
GMDB:
Equity $ 40,678
$ 41,658
Fixed income 5,384
5,469
Balanced 45,485
46,577
Other 957
968
Total $ 92,504
$ 94,672
GMIB:
Equity $ 19,156
$ 19,928
Fixed income 3,074
3,150
Balanced 37,918
38,890
Other 311
318
Total $ 60,459
$ 62,286


~~(1)~~	Amounts previously reported were as follows in millions: (a) GMDB: Equity $78,069, Fixed Income $2,234, Balanced $14,084, and Other $283; (b) GMIB: Equity $50,429, Fixed Income $1,568, Balanced $10,165, and Other $124.

~~C) Hedging Programs for GMDB, GMIB, GIB and Other Features~~

Beginning in 2003, the Company established a program intended to hedge certain risks associated first with the GMDB feature and, beginning in 2004, with the GMIB feature of the Accumulator series of variable annuity products. The program has also been extended to cover other guaranteed benefits as they have been made available. This program utilizes derivative contracts, such as exchange-traded equity, currency and interest rate futures contracts, total return and/or equity swaps, interest rate swap and floor contracts, swaptions, variance swaps as well as equity options, that collectively are managed in an effort to reduce the economic impact of unfavorable changes in guaranteed benefits’ exposures attributable to movements in the capital markets. At the present time, this program hedges certain economic risks on products sold from 2001 forward, to the extent such risks are not externally reinsured. At March 31, 2018, the total account value and net amount at risk of the hedged variable annuity contracts were $68,663 million and $17,102 million, respectively, with the GMDB feature and $57,781 million and $$7,236 million, respectively, with the GMIB and GIB feature. A hedge program is also used to manage certain capital markets risks associated with the products the Company has assumed that have GMDB and GMIB features. At March 31, 2018, the total account value and net amount at risk of the hedged assumed variable annuity contracts were $9,053 million and $666 million, respectively, with the GMDB feature and $2,645 million and $255 million, respectively, with the GMIB feature.

These programs do not qualify for hedge accounting treatment. Therefore, gains (losses) on the derivatives contracts used in these programs, including current period changes in fair value, are recognized in net investment income (loss) in the period in which they occur, and may contribute to income (loss) volatility.

~~D) Variable and Interest-Sensitive Life Insurance Policies - NLG~~

The NLG feature contained in variable and interest-sensitive life insurance policies keeps them in force in situations where the policy value is not sufficient to cover monthly charges then due. The NLG remains in effect so long as the policy meets a contractually specified premium funding test and certain other requirements.

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

The following table summarizes the NLG liabilities reflected in the General Account in Future policy benefits and other policyholders’ liabilities, the related reinsurance reserve ceded, reflected in Amounts due from reinsurers and deferred cost of reinsurance, reflected in Other assets in the Consolidated balance sheets:

Direct
Liability⁽¹⁾
(in millions)
Balance at January 1, 2018 $ 686
Paid Guaranteed Benefits (8 )
Other changes in reserves 26
Balance at March 31, 2018 $ 704
Balance at January 1, 2017 $ 1,307
Other changes in reserves 4
Balance at March 31, 2017 $ 1,311

~~(1) There were no amounts of reinsurance ceded in any period presented.~~

~~6) REINSURANCE AGREEMENTS~~

Effective February 1, 2018, AXA Equitable Life entered into a coinsurance reinsurance agreement (the “Coinsurance Agreement”) to cede 90% of its single premium deferred annuities (SPDA) products issued between 1978-2001 and its Guaranteed Growth Annuity (GGA) single premium deferred annuity products issued between 2001-2014. As a result of this agreement, AXA Equitable Life transferred securities with a market value of $604 million and cash of $31 million to equal the statutory reserves of approximately $635 million. As the risks transferred by AXA Equitable Life to the reinsurer under the Coinsurance Agreement are not considered insurance risks and therefore do not qualify for reinsurance accounting, AXA Equitable Life applied deposit accounting. Accordingly, AXA Equitable Life recorded the transferred assets of $635 million as a deposit asset recorded in Other assets, net of the ceding commissions paid to the reinsurer.

7) FAIR VALUE DISCLOSURES

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The accounting guidance establishedU.S. GAAP establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value, and identifies three levels of inputs that may be used to measure fair value:

Level 1 Unadjusted quoted prices for identical instruments in active markets. Level 1 fair values generally are supported by market transactions that occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar instruments, quoted prices in markets that are not active, and inputs to model-derived valuations that are directly observable or can be corroborated by observable market data.

Level 3 Unobservable inputs supported by little or no market activity and often requiring significant management judgment or estimation, such as an entity’s own assumptions about the cash flows or other significant components of value that market participants would use in pricing the asset or liability.

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

The Company uses unadjusted quoted market prices to measure ~~the~~ fair value offor those instruments that are actively traded in financial markets. In cases where quoted market prices are not available, fair values are measured using present value or other valuation techniques. The fair value determinations are made at a specific point in time, based on available market information and judgments about the financial instrument, including estimates of the timing and amount of expected future cash flows and the credit standing of counterparties. Such adjustments do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument, nor do they consider the tax impact of the realization of unrealized gains or losses. In many cases, the fair value cannot be substantiated by direct comparison to independent markets, nor can the disclosed value be realized in immediate settlement of the instrument.

Management is responsible for the determination of the value of investments carried at fair value and the supporting methodologies and assumptions. Under the terms of various service agreements, the Company often utilizes independent valuation service providers to gather, analyze, and interpret market information and derive fair values based upon relevant methodologies and assumptions for individual securities. These independent valuation service providers typically obtain data about market transactions and other key valuation model inputs from multiple sources and, through the use of widely accepted valuation models, provide a single fair value measurement for individual securities for which a fair value has been requested. As further described below with respect to specific asset classes, these inputs include, but are not limited to, market prices for recent trades and transactions in comparable securities, benchmark yields, interest rate yield curves, credit spreads, quoted prices for similar securities, and other market-observable information, as applicable. Specific attributes of the security being valued are also ~~are~~ considered, including its term, interest rate, credit rating, industry sector, and when applicable, collateral quality and other security- or issuer-specific information. When insufficient market observable information is available upon which to measure fair value, the Company either will request brokers knowledgeable about these securities to provide a non-binding quote or will employ internal valuation models. Fair values received from independent valuation service providers and brokers and those internally modeled or otherwise estimated are assessed for reasonableness.

Assets and ~~liabilities measured~~Liabilities Measured at ~~fair value~~Fair Value on a ~~recurring basis are summarized below. At March 31, 2018 and December 31, 2017, no assets were required to be measured at fair value on a non-recurring basis.~~ Nonrecurring Basis

Fair value measurements are required on a non-recurring basis for certain assets ~~including goodwill and mortgage loans on real estate,~~ only when an ~~OTTI~~impairment or other ~~event occurs. When such~~events occur. For the periods ended September 30, 2023 and December 31, 2022, the Company recognized impairment adjustments and impairment losses, respectively, to adjust the carrying value of held-for-sale asset and liabilities to their fair value ~~measurements are recorded, they must be classified~~less cost to sell. The value is measured on a nonrecurring basis and ~~disclosed~~categorized within Level 3 of the fair value hierarchy. The ~~Company recognizes transfers between valuation levels at~~fair value was determined using a market approach, estimated based on the ~~beginning~~negotiated value of the ~~reporting period.~~asset and liabilities. See Note 20 of the Notes to these Consolidated Financial Statements for additional details of the Held-for-Sale assets and liabilities.

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

Assets and Liabilities Measured at Fair Value ~~Measurements at March 31, 2018~~on a Recurring Basis

Level 1 Level 2 Level 3 Total
(in millions)
Assets
Investments
Fixed maturities, available-for-sale:
Public Corporate $ —
$ 18,581
$ 135
$ 18,716
Private Corporate —
6,286
1,118
7,404
U.S. Treasury, government and agency —
14,653
—
14,653
States and political subdivisions —
438
39
477
Foreign governments —
419
—
419
Residential mortgage-backed⁽¹⁾
—
627
—
627
Asset-backed⁽²⁾
—
135
540
675
Redeemable preferred stock 180
333
—
513
Subtotal 180
41,472
1,832
43,484
Other equity investments 13
—
34
47
Trading securities 448
14,427
44
14,919
Other invested assets:
Short-term investments —
854
—
854
Assets of consolidated VIEs/VOEs 1,691
291
32
2,014
Swaps —
356
—
356
Credit Default Swaps —
29
—
29
Options —
1,939
—
1,939
Subtotal 1,691
3,469
32
5,192
Cash equivalents 4,894
—
—
4,894
Segregated securities —
1,025
—
1,025
GMIB reinsurance contract asset —
—
1,734
1,734
Separate Accounts’ assets 118,466
2,845
357
121,668
Total Assets $ 125,692
$ 63,238
$ 4,033
$ 192,963
Liabilities
Other invested liabilities
GMxB derivative features’ liability $ —
$ —
$ 3,977
$ 3,977
SCS, SIO, MSO and IUL indexed features’ liability —
1,683
—
1,683
Liabilities of consolidated VIEs/VOEs 1,190
18
—
1,208
Contingent payment arrangements —
—
14
14
Total Liabilities $ 1,190
$ 1,701
$ 3,991
$ 6,882


~~(1)~~	~~Includes publicly traded agency pass-through securities and collateralized obligations.~~


~~(2)~~	~~Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans.~~

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~Fair Value Measurements at December 31, 2017~~

Level 1 Level 2 Level 3 Total
(in millions)
Assets
Investments
Fixed maturities, available-for-sale:
Public Corporate $ —
$ 17,906
$ 48
$ 17,954
Private Corporate —
6,390
1,102
7,492
U.S. Treasury, government and agency —
18,508
—
18,508
States and political subdivisions —
449
40
489
Foreign governments —
419
—
419
Residential mortgage-backed⁽¹⁾
—
818
—
818
Asset-backed⁽²⁾
—
208
541
749
Redeemable preferred stock 184
327
1
512
Subtotal 184
45,025
1,732
46,941
Other equity investments 13
—
34
47
Trading securities 485
13,647
38
14,170
Other invested assets:
Short-term investments —
1,730
—
1,730
Assets of consolidated VIEs/VOEs 1,060
215
27
1,302
Swaps —
222
—
222
Credit Default Swaps —
33
—
33
Futures (2 ) —
—
(2 )
Foreign currency contract⁽³⁾
—
5
—
5
Options —
1,999
—
1,999
Subtotal 1,058
4,204
27
5,289
Cash equivalents 3,608
—
—
3,608
Segregated securities —
825
—
825
GMIB reinsurance contract asset —
—
1,894
1,894
Separate Accounts’ assets 121,000
2,997
349
124,346
Total Assets $ 126,348
$ 66,698
$ 4,074
$ 197,120
Liabilities
Other invested liabilities
GMxB derivative features’ liability $ —
$ —
$ 4,358
$ 4,358
SCS, SIO, MSO and IUL indexed features’ liability —
1,786
—
1,786
Liabilities of consolidated VIEs/VOEs 670
22
—
692
Contingent payment arrangements —
—
15
15
Total Liabilities $ 670
$ 1,808
$ 4,373
$ 6,851


~~(1)~~	~~Includes publicly traded agency pass-through securities and collateralized obligations.~~


~~(2)~~	~~Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans.~~


~~(3)~~	~~Reported in Other assets in the consolidated balance sheets.~~

~~At March 31, 2018~~Assets and ~~December 31, 2017, respectively, the fair value of public fixed maturities is approximately $35,131 million and $38,762 million or approximately 18.5% and 20.0% of the Company’s total assets~~liabilities measured at fair value on a recurring basis ~~(excluding GMIB reinsurance contracts~~are summarized below:

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Fair Value Measurements as of September 30, 2023


	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:
Investments
Fixed maturities, AFS:
Corporate (1)	$	—	$	40,671	$	2,103	$	42,774
U.S. Treasury, government and agency	—		4,171		—		4,171
States and political subdivisions	—		489		26		515
Foreign governments	—		661		—		661
Residential mortgage-backed (2)	—		1,616		39		1,655
Asset-backed (3)	—		10,270		10		10,280
Commercial mortgage-backed	—		3,321		50		3,371
Redeemable preferred stock	—		43		—		43
Total fixed maturities, AFS	—		61,242		2,228		63,470
Fixed maturities, at fair value using the fair value option	—		1,454		180		1,634
Other equity investments (4)	217		445		53		715
Trading securities	329		610		70		1,009
Other invested assets:
Short-term investments	—		677		—		677
Assets of consolidated VIEs/VOEs	73		248		53		374
Swaps	—		(376)		—		(376)
Credit default swaps	—		6		—		6
Futures	3		—		—		3
Options	—		7,618		—		7,618
Total other invested assets	76		8,173		53		8,302
Cash equivalents	3,889		721		—		4,610
Segregated securities	—		928		—		928
Purchased market risk benefits	—		—		8,745		8,745
Assets for market risk benefits	—		—		701		701
Separate Accounts assets (5)	114,566		2,454		1		117,021
Total Assets	$	119,077	$	76,027	$	12,031	$	207,135

Liabilities:
Notes issued by consolidated VIE’s, at fair value using the fair value option (6)	$	—	$	1,510	$	—	$	1,510
SCS, SIO, MSO and IUL indexed features’ liability	—		7,905		—		7,905
Liabilities of consolidated VIEs and VOEs	1		3		—		4
Liabilities for market risk benefits	—		—		13,011		13,011
Contingent payment arrangements	—		—		252		252
Total Liabilities	$	1	$	9,418	$	13,263	$	22,682

______________

(1)Corporate fixed maturities includes both public and ~~segregated~~private issues.

(2)Includes publicly traded agency pass-through securities and collateralized obligations.

(3)Includes credit-tranched securities collateralized by sub-prime mortgages, credit risk transfer securities and other asset types.

(4)Includes short position equity securities of $13 million that are reported in other liabilities.

(5)Separate Accounts assets included in the fair value hierarchy exclude investments in entities that calculate NAV per share (or its equivalent) as a practical expedient. Such investments excluded from the fair value hierarchy include investments in real estate. As of September 30, 2023, the fair value of such investments was $382 million.

(6)Accrued interest payable of $31 million is reported in Notes issued by consolidated VIE’s, at fair value using the fair value option in the consolidated balance sheets, which is not required to be measured at fair value

on a recurring basis.

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~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

Fair Value Measurements as of December 31, 2022


	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:
Investments
Fixed maturities, AFS:
Corporate (1)	$	—	$	41,450	$	2,121	$	43,571
U.S. Treasury, government and agency	—		5,837		—		5,837
States and political subdivisions	—		499		28		527
Foreign governments	—		836		—		836
Residential mortgage-backed (2)	—		788		34		822
Asset-backed (3)	—		8,490		—		8,490
Commercial mortgage-backed (2)	—		3,203		32		3,235
Redeemable preferred stock	—		43		—		43
Total fixed maturities, AFS	—		61,146		2,215		63,361
Fixed maturities, at fair value using the fair value option	—		1,284		224		1,508
Other equity investments (4)	214		497		12		723
Trading securities	290		332		55		677
Other invested assets:
Short-term investments	—		943		—		943
Assets of consolidated VIEs/VOEs	131		393		5		529
Swaps	—		(425)		—		(425)
Credit default swaps	—		9		—		9
Futures	2		—		—		2
Options	—		4,171		—		4,171
Total other invested assets	133		5,091		5		5,229
Cash equivalents	2,386		501		—		2,887
Segregated securities	—		1,522		—		1,522
Purchased market risk benefits	—		—		10,423		10,423
Assets for market risk benefits	—		—		490		490
Separate Accounts assets (5)	111,744		2,436		1		114,181
Total Assets	$	114,767	$	72,809	$	13,425	$	201,001

Liabilities:
Notes issued by consolidated VIE’s, at fair value using the fair value option (6)	$	—	$	1,374	$	—	$	1,374
SCS, SIO, MSO and IUL indexed features’ liability	—		4,164		—		4,164
Liabilities of consolidated VIEs and VOEs	15		7		—		22
Liabilities for market risk benefits	—		—		15,766		15,766
Contingent payment arrangements	—		—		247		247
Total Liabilities	$	15	$	5,545	$	16,013	$	21,573

______________

(1)Corporate fixed maturities includes both public and private issues.

(2)Includes publicly traded agency pass-through securities and collateralized obligations.

(3)Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans.

(4)Includes short position equity securities of $12 million that are reported in other liabilities.

(5)Separate Accounts assets included in the fair value hierarchy exclude investments in entities that calculate NAV per share (or its equivalent) as a practical expedient. Such investments excluded from the fair value hierarchy include investments in real estate and commercial mortgages. As of December 31, 2022, the fair value of such investments was $456 million.

(6)Includes CLO short-term debt of $239 million, which is inclusive as fair valued within Notes issued by consolidated VIE’s, at fair value using the fair value option accrued interest payable of $15 million is reported in notes issued by consolidated VIE’s, at fair value using the fair value option in the consolidated balance sheets, which is not required to be measured at fair value on a recurring ~~basis).~~ basis.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Public Fixed Maturities

The fair values of the Company’s public fixed ~~maturity securities~~maturities, including those accounted for using the fair value option are generally based on prices obtained from independent valuation service providers and for which the Company maintains a vendor hierarchy by asset type based on historical pricing experience and vendor expertise. Although each security generally is priced by multiple independent valuation service providers, the Company ultimately uses the price received from the independent valuation service provider highest in the vendor hierarchy based on the respective asset type, with limited exception. To validate reasonableness, prices also are internally reviewed by those with relevant expertise through comparison with directly observed recent market trades. Consistent with the fair value hierarchy, public fixed ~~maturity securities~~maturities validated in this manner generally are reflected within Level 2, as they are primarily based on observable pricing for similar assets and/or other market observable inputs. If the pricing information received from independent valuation service providers is not reflective of market activity or other inputs observable in the market, the Company may challenge the price through a formal process in accordance with the terms of the respective independent valuation service provider agreement. If as a result it is determined that the independent valuation service provider is able to reprice the security in a manner agreed as more consistent with current market observations, the security remains within Level 2. Alternatively, a Level 3 classification may result if the pricing information then is sourced from another vendor, non-binding broker quotes, or internally-developed valuations for which the Company’s own assumptions about market-participant inputs would be used in pricing the security.

At March 31, 2018 and December 31, 2017, respectively, the fair value of private fixed maturities is approximately $8,353 million and $8,179 million or approximately 4.4% and 4.2% of the Company’s total assets measured at fair value on a recurring basis. Private Fixed Maturities

The fair values of the Company’s private fixed maturities, including those accounted for using the fair value option are determined from prices obtained from independent valuation service providers. Prices not obtained from an independent valuation service provider are determined by using a discounted cash flow model or a market comparable company valuation technique. In certain cases, these models use observable inputs with a discount rate based upon the average of spread surveys collected from private market intermediaries who are active in both primary and secondary transactions, taking into account, among other factors, the credit quality and industry sector of the issuer and the reduced liquidity associated with private placements. Generally, these securities have been reflected within Level 2. For certain private fixed maturities, the discounted cash flow model or a market comparable company valuation technique may also incorporate unobservable inputs, which reflect the Company’s own assumptions about the inputs market participants would use in pricing the asset. To the extent management determines that such unobservable inputs are significant to the fair value measurement of a security, a Level 3 classification generally is made.

Notes issued by consolidated VIE’s, at fair value using the fair value option

These notes are based on the fair values of corresponding fixed maturity collateral. The CLO liabilities are also reduced by the fair value of the beneficial interests the Company retains in the CLO and the carrying value of any beneficial interests that represent compensation for services. As ~~disclosed in Note 3, at March 31, 2018 and December 31, 2017, respectively,~~ the notes are valued based on the reference collateral, they are classified as Level 2 or 3.

Freestanding Derivative Positions

The net fair value of the Company’s freestanding derivative positions ~~is approximately 44.8% and 42.9% of Other invested assets measured at fair value on a recurring basis, with a value of $2,324 million and $2,258 million. The fair values~~as disclosed in Note 4 of the ~~Company’s derivative positions~~Notes to these Consolidated Financial Statements are generally based on prices obtained either from independent valuation service providers or derived by applying market inputs from recognized vendors into industry standard pricing models. The majority of these derivative contracts are traded in the OTC derivative market and are classified in Level 2. The fair values of derivative assets and liabilities traded in the OTC market are determined using quantitative models that require use of the contractual terms of the derivative instruments and multiple market inputs, including interest rates, prices, and indices to generate continuous yield or pricing curves, including overnight index swap ~~(“OIS”)~~ curves, and volatility factors, which then are applied to value the positions. The predominance of market inputs is actively quoted and can be validated through external sources or reliably interpolated if less observable. If the pricing information received from independent valuation service providers is not reflective of market activity or other inputs observable in the market, the Company may challenge the price through a formal process in accordance with the terms

Level Classifications of the ~~respective independent valuation service provider agreement. If~~Company’s Financial Instruments

Financial Instruments Classified as a result it is determined that the independent valuation service provider is able to reprice the derivative instrument in a manner agreed as more consistent with current market observations, the position remains within Level 2. Alternatively, a Level 3 classification may result if the pricing information then is sourced from another vendor, non-binding broker quotes, or internally-developed valuations for which the Company’s own assumptions about market-participant inputs would be used in pricing the security.1

~~At March 31, 2018 and December 31, 2017, respectively, investments~~Investments classified as Level 1 ~~comprise approximately 66.1% and 64.9% of assets measured at fair value on a recurring basis and~~ primarily include redeemable preferred stock, trading securities, cash equivalents and Separate ~~Account~~Accounts assets. Fair value measurements classified as Level 1

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

include exchange-traded prices of fixed maturities, equity securities and derivative contracts, and net asset values for transacting subscriptions and redemptions of mutual fund shares held by Separate Accounts. Cash equivalents classified as Level 1 include money market accounts, overnight commercial paper and highly liquid debt instruments purchased with an original maturity of three months or less and are carried at cost as a proxy for fair value measurement due to their short-term nature.

~~At March 31, 2018 and December 31, 2017, respectively, investments~~

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Financial Instruments Classified as Level 2

Investments classified as Level 2 ~~comprise approximately 32.7% and 34.0% of assets~~are measured at fair value on a recurring basis and primarily include U.S. government and agency securities, ~~and~~ certain corporate debt securities and financial assets and liabilities accounted for using the fair value option, such as public and private fixed maturities. As market quotes generally are not readily available or accessible for these securities, their fair value measures are determined utilizing relevant information generated by market transactions involving comparable securities and often are based on model pricing techniques that effectively discount prospective cash flows to present value using appropriate sector-adjusted credit spreads commensurate with the security’s duration, also taking into consideration issuer-specific credit quality and liquidity. Segregated securities classified as Level 2 are U.S. Treasury bills segregated by AB in a special reserve bank custody account for the exclusive benefit of brokerage customers, as required by Rule 15c3-3 of the Exchange Act and for which fair values are based on quoted yields in secondary markets.

Observable inputs generally used to measure the fair value of securities classified as Level 2 include benchmark yields, reported secondary trades, issuer spreads, benchmark securities and other reference data. Additional observable inputs are used when available, and as may be appropriate, for certain security types, such as ~~prepayment,~~pre-payment, default, and collateral information for the purpose of measuring the fair value of mortgage- and asset-backed securities. ~~At March 31, 2018 and December 31, 2017, respectively, approximately $641 million and $875 million of~~The Company’s AAA-rated mortgage- and asset-backed securities are classified as Level 2 for which the observability of market inputs to their pricing models is supported by sufficient, albeit more recently contracted, market activity in these sectors.

Certain Company products, such as the SCS, ~~and~~ EQUI-VEST variable annuity ~~product,~~products, IUL and in the MSO fund available in some life contracts, offer investment options which permit the contract owner to participate in the performance of an index, ETF or commodity price. These investment options, which depending on the product and on the index selected, can currently have ~~1, 3, 5,~~one, three, five or 6six year terms, provide for participation in the performance of specified indices, ETF or commodity price movement up to a segment-specific declared maximum rate. Under certain conditions that vary by product, e.g., holding these segments for the full term, these segments also shield policyholders from some or all negative investment performance associated with these indices, ETF or commodity prices. These investment options have defined formulaic liability amounts, and the current values of the option component of these segment reserves are ~~accounted for~~classified as Level 2 embedded derivatives. The fair values of these embedded derivatives are based on data obtained from independent valuation service providers.

~~At March 31, 2018 and December 31, 2017, respectively,~~Financial Instruments Classified as Level 3

The Company’s investments classified as Level 3 ~~comprise approximately 1.2% and 1.1% of assets measured at fair value on a recurring basis and~~ primarily include corporate debt securities and financial assets and liabilities accounted for using the fair value option, such as private fixed ~~maturities.~~maturities and asset-backed securities. Determinations to classify fair value measures within Level 3 of the valuation hierarchy generally are based upon the significance of the unobservable factors to the overall fair value measurement. Included in the Level 3 classification ~~at March 31, 2018 and December 31, 2017, respectively, were approximately $95 million and $97 million of~~are fixed maturities with indicative pricing obtained from brokers that otherwise could not be corroborated to market observable data. The Company applies various due diligence procedures, as considered appropriate, to validate these non-binding broker quotes for reasonableness, based on its understanding of the markets, including use of internally-developed assumptions about inputs a market participant would use to price the security. In addition, approximately $540 million and $598 million of mortgage- and asset-backed securities are classified as Level 3 at March 31, 2018 and December 31, 2017, respectively.

The Company ~~also issues~~has certain ~~benefits on its~~ variable annuity ~~products~~contracts with GMDB, GMIB, GIB and GWBL and other features in-force that ~~are accounted~~guarantee one of the following:

•Return of Premium: the benefit is the greater of current account value or premiums paid (adjusted for ~~as derivatives and are also considered Level 3.~~ withdrawals);

•Ratchet: the benefit is the greatest of current account value, premiums paid (adjusted for withdrawals), or the highest account value on any anniversary up to contractually specified ages (adjusted for withdrawals);

•Roll-Up: the benefit is the greater of current account value or premiums paid (adjusted for withdrawals) accumulated at contractually specified interest rates up to specified ages;

•Combo: the benefit is the greater of the ratchet benefit or the roll-up benefit, which may include either a five year or an annual reset; or

•Withdrawal: the withdrawal is guaranteed up to a maximum amount per year for life.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The GMIBNLG feature allows the policyholder to receive guaranteed minimum lifetime annuity payments based on predetermined annuity purchase rates applied to the contract’s benefit base if and when the contract account value is depleted and the NLG feature is activated. The optional GMIB feature allows the policyholder to receive guaranteed minimum lifetime annuity payments based on predetermined annuity purchase rates.

The GMWB feature allows the policyholder to withdraw at a minimum, over the life of the contract, an amount based on the contract’s benefit base. The GWBL feature allows the policyholder to withdraw, each year for the life of the contract, a specified annual percentage of an amount

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

based on the contract’s benefit base. The GMAB feature increases the contract account value at the end of a specified period to a GMAB base. The GIB feature provides a lifetime annuity based on predetermined annuity purchase rates if and when the contract account value is depleted. This lifetime annuity is based on predetermined annuity purchase rates applied to a GIB base. The GMDB feature guarantees that the benefit paid upon death will not be less than a guaranteed benefit base. If the contract’s account value is less than the benefit base at the time a death claim is paid, the amount payable will be equal to the benefit base.

These are accounted for as market risk benefits carried at fair value and are also considered Level 3 ~~also includes the GMIB reinsurance contract asset’s~~for fair value leveling.

Purchased MRB assets, which are accounted for as ~~derivative contracts.~~market risk benefits carried at fair value are also considered Level 3 for fair value leveling. The ~~GMIB reinsurance contract~~purchased MRB asset ~~and liabilities’~~ fair value reflects the present value of reinsurance premiums, ~~and~~net of recoveries, ~~and~~adjusted for risk margins and nonperformance risk over a range of market consistent economic scenarios while ~~GMxB derivative features~~the MRB asset and liability reflects the present value of expected future payments (benefits) less fees, adjusted for risk margins and nonperformance risk, attributable to ~~GMxB derivative features’~~the MRB asset and liability over a range of market-consistent economic scenarios.

The valuations of the ~~GMIB reinsurance contract asset~~MRBs and ~~GMxB derivative features liability~~purchased MRB assets incorporate significant non-observable assumptions related to policyholder behavior, risk margins and projections of equity ~~separate account~~Separate Accounts funds. The credit risks of the counterparty and of the Company are considered in determining the fair values of its ~~GMIB reinsurance contract asset~~MRBs and ~~GMxB derivative features liability positions, respectively,~~purchased MRB assets after taking into account the effects of collateral arrangements. Incremental adjustment to the ~~swap~~risk-free curve for counterparty non-performance risk is made to the fair values of the GMIB reinsurance contract asset and liabilities and GMIBNLG feature to reflect the claims-paying ratings of counterparties and the Company. Equity and fixed income volatilities were modeled to reflect current market volatilities. Due to the unique, long duration of the GMIBNLG feature, adjustments were made to the equity volatilities to remove the illiquidity bias associated with the longer tenors and riskpurchased MRB assets. Risk margins were applied to the non-capital markets inputs to the ~~GMIBNLG~~MRBs and purchased MRB valuations.

After giving consideration to collateral arrangements, the Company reduced the fair value of its ~~GMIB reinsurance contract~~purchased MRB asset by ~~$12~~$730 million and ~~$8 million at March 31, 2018~~$1.1 billion as of September 30, 2023 and December 31, ~~2017,~~2022, respectively, to recognize incremental counterparty non-performance risk and reduced the fair value of its GMIB reinsurance contract liabilities by $24 million and $24 million at March 31, 2018 and December 31, 2017, respectively to recognize its own incremental non-performance risk.

Lapse rates are adjusted at the contract level based on a comparison of the actuarially calculated guaranteed values and the current policyholder account value, which include other factors such as considering surrender charges. Generally, lapse rates are assumed to be lower in periods when a surrender charge applies. A dynamic lapse function reduces the base lapse rate when the guaranteed amount is greater than the account value as in the money contracts are less likely to lapse. For valuing the embedded derivative, lapse rates vary throughout the period over which cash flows are projected.

The Company’s Level 3 liabilities include contingent payment arrangements associated with acquisitions in ~~2010, 2013, 2014~~2020 and ~~2016~~2022 by AB. At each reporting date, AB estimates the fair values of the contingent consideration expected to be paid based upon ~~probability-weighted AUM~~revenue and ~~revenue~~discount rate projections, using unobservable market data inputs, which are included in Level 3 of the valuation hierarchy. The Company’s Level 3 liabilities also include contingent payment arrangements associated with a Renewal Rights Agreement (the “Renewal Rights Agreement”) that transitions certain group employee benefits policies beginning January 1, 2017 from an insurer exiting such business to MONY Life Insurance Company of America (“MLOA”). The fair value of the contingent payments liability associated with this transaction is measured and adjusted each reporting period through final settlement using projected premiums from these policies, net of potential surrenders and terminations, and applying a risk-adjusted discount factor (7.0% at March 31, 2018) to the resulting cash flows.

~~As of March 31, 2018 and December 31, 2017, the Company’s~~ consolidated VIEs/VOEs hold ~~$32 million and $27 million, respectively of~~ investments that are classified as Level 3, primarily ~~consist of~~ corporate bonds that are vendor priced with no ratings available, bank loans, non-agency collateralized mortgage obligations and asset-backed securities.

Transfers of Financial Instruments Between Levels 2 and 3

During the ~~first three~~nine months ~~of 2018, AFS~~ended September 30, 2023, fixed maturities with fair values of ~~$16~~$489 million were transferred out of Level 3 and into Level 2 principally due to the availability of trading activity and/or market observable inputs to measure and validate their fair values. In addition, ~~AFS~~ fixed maturities with fair value of ~~$67~~$29 million were transferred from Level 2 into the Level 3 classification. These transfers in the aggregate represent approximately ~~0.5%~~15.8% of total equity ~~at March 31, 2018.~~as of September 30, 2023.

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

InDuring the ~~first three~~nine months ~~of 2017, $0 million AFS~~ended September 30, 2022, fixed maturities with fair values of $150 million were transferred out of Level 3 and into Level 2 principally due to the availability of trading activity and/or market observable inputs to measure and validate their fair values. In addition, ~~AFS~~ fixed maturities with fair value of ~~$24~~$191 million were transferred from Level 2 into the Level 3 classification. These transfers in the aggregate represent approximately ~~0.2%~~7.0% of total equity ~~at March 31, 2017.~~as of September 30, 2022.

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The ~~table~~tables below ~~presents a reconciliation~~present reconciliations for all Level 3 assets and liabilities ~~for the three months ended March 31, 2018~~ and ~~2017, respectively:~~

~~Level 3 Instruments~~

~~Fair Value Measurements~~

Corporate State and
Political
Sub-
divisions Commercial
Mortgage-
backed Asset-
backed
(in millions)
Balance, January 1, 2018 $ 1,150
$ 40
$ —
$ 541
Total gains (losses), realized and unrealized, included in:
Income (loss) as:
Net investment income (loss) 1
—
—
—
Investment gains (losses), net —
—
—
—
Subtotal 1
—
—
—
Other comprehensive income (loss) (21 ) (1 ) —
—
Purchases 189
—
—
—
Sales (117 ) —
—
(1 )
Settlements —
—
—
—
Transfers into Level 3⁽¹⁾
67
—
—
—
Transfers out of Level 3⁽¹⁾
(16 ) —
—
—
Balance, March 31, 2018 $ 1,253
$ 39
$ —
$ 540
Balance, January 1, 2017 $ 857
$ 42
$ 373
$ 120
Total gains (losses), realized and unrealized, included in:
Income (loss) as:
Net investment income (loss) 1
—
—
—
Investment gains (losses), net —
—
(23 ) —
Subtotal 1
—
(23 ) —
Other comprehensive income (loss) 45
—
25
5
Purchases 171
—
—
195
Sales (67 ) —
(35 ) (3 )
Transfers into Level 3⁽¹⁾
18
—
—
6
Transfers out of Level 3⁽¹⁾
—
—
—
—
Balance, March 31, 2017 $ 1,025
$ 42
$ 340
$ 323

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

Redeemable
Preferred
Stock
Other
Equity
Investments⁽²⁾
GMIB
Reinsurance
Contract Asset Separate
Accounts
Assets GMxB derivative features liability Contingent
Payment
Arrangement
(in millions)
Balance, January 1, 2018 $ 1
$ 99
$ 1,894
$ 349
$ (4,358 ) $ (15 )
Total gains (losses), realized and unrealized, included in:
Income (loss) as:
Net investment income (loss) —
—
—
—
—
—
Investment gains (losses), net —
—
—
7
—
—
Net derivative gains (losses) —
—
(159 ) —
460
—
Subtotal —
—
(159 ) 7
460
—
Other comprehensive income (loss) —
1
—
—
—
—
Purchases⁽²⁾
—
4
10
3
(84 ) —
Sales⁽³⁾
(1 ) —
(11 ) (1 ) 5
—
Settlements⁽⁴⁾
—
—
—
(1 ) —
1
Activity related to consolidated VIEs —
1
—
—
—
—
Transfers into Level 3⁽¹⁾
—
5
—
—
—
—
Transfers out of Level 3⁽¹⁾
—
—
—
—
—
—
Balance, March 31, 2018 $ —
$ 110
$ 1,734
$ 357
$ (3,977 ) $ (14 )
Balance, January 1, 2017 $ 1
$ 88
$ 1,735
$ 313
$ (5,580 ) $ (25 )
Total gains (losses), realized and unrealized, included in:
Income (loss) as:
Net investment income (loss) —
—
—
—
—
—
Investment gains (losses), net —
(9 ) —
10
—
—
Net derivative gains (losses) —
—
(71 )

507
—
Subtotal —
(9 ) (71 ) 10
507
—
Other comprehensive income (loss) —
—
—
—
—
—
Purchases⁽²⁾
—
4
9
3
(81 ) —
Sales⁽³⁾
—
(1 ) (14 ) (1 ) 8
—
Settlements⁽⁴⁾
—

—
(1 ) —
1
Activity related to consolidated VIEs —
(9 ) —
—
—
—
Transfers into Level 3⁽¹⁾
—
1
—
1
—
—
Transfers out of Level 3⁽¹⁾
—

—
—
—
—
Balance, March 31, 2017 $ 1
$ 74
$ 1,659
$ 325
$ (5,146 ) $ (24 )


~~(1)~~	~~Transfers into/out of Level 3 classification are reflected at beginning-of-period fair values.~~

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~


~~(2)~~	~~For the GMIB reinsurance contract asset, and GMxB derivative features liability, represents attributed fee.~~


~~(3)~~	~~For the GMIB reinsurance contract asset, represents recoveries from reinsurers and for GMxB derivative features liability represents benefits paid.~~


~~(4)~~	~~For contingent payment arrangements, it represents payments under the arrangement.~~

~~The table below details~~ changes in unrealized gains (losses) ~~for~~. Not included below are the ~~three months ended March 31, 2018~~changes in balances related to market risk benefits and ~~2017 by category for Level~~purchased market risk benefits level 3 assets and liabilities, ~~still~~which are included in Note 9 of the Notes to these Consolidated Financial Statements.


	Three Months Ended September 30, 2023
	Corporate		State and Political Subdivisions		CMBS		Asset-backed		RMBS
	(in millions)
Balance, beginning of period	$	2,037	$	27	$	34	$	—	$	—
Total gains and (losses), realized and unrealized, included in:
Net income (loss) as:
Net investment income (loss)	1		—		—		—		—
Investment gains (losses), net	(5)		—		—		—		—
Subtotal	(4)		—		—		—		—
Other comprehensive income (loss)	5		—		(1)		—		(1)
Purchases	163		—		17		10		40
Sales	(53)		(1)		—		—		—
Settlements	—		—		—		—		—
Other	—		—		—		—		—
Activity related to consolidated VIEs/VOEs	—		—		—		—		—
Transfers into Level 3 (1)	(11)		—		—		—		—
Transfers out of Level 3 (1)	(34)		—		—		—		—
Balance, end of period	$	2,103	$	26	$	50	$	10	$	39
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	5	$	—	$	—	$	—	$	—

______________

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.

(2)For instruments held ~~at March 31, 2018 and 2017, respectively:~~as of September 30, 2023, amounts are included in net investment income or net derivative gains (losses) in the consolidated statements of income (loss) or unrealized gains (losses) on investments in the consolidated statements of comprehensive income.

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Income (Loss)
Investment
Gains
(Losses),
Net Net Derivative Gains (losses) OCI
(in millions)
Level 3 Instruments
First Quarter of 2018
Held at March 31, 2018:
Change in unrealized gains (losses):
Fixed maturities, available-for-sale:
Corporate $ —
$ —
$ (19 )
State and political subdivisions —
—
(1 )
Asset-backed —
—
—
Subtotal $ —
$ —
$ (20 )
GMIB reinsurance contracts —
(159 ) —
Separate Accounts’ assets⁽¹⁾
7
—
—
GMxB derivative features’ liability —
460
—
Total $ 7
$ 301
$ (20 )
Level 3 Instruments
First Quarter of 2017
Held at March 31, 2017:
Change in unrealized gains (losses):
Fixed maturities, available-for-sale:
Corporate $ —
$ —
$ 45
Commercial mortgage-backed —
—
13
Asset-backed —
—
5
Subtotal $ —
$ —
$ 63
GMIB reinsurance contracts —
(71 ) —
Separate Accounts’ assets⁽¹⁾
10
—
—
GMxB derivative features’ liability —
507
—
Total $ 10
$ 436
$ 63


	Three Months Ended September 30, 2023
	Other Equity Investments (3)		Separate Accounts Assets		Contingent Payment Arrangement		Trading Securities, at Fair Value		Fixed maturities, at FVO
	(in millions)
Balance, beginning of period	$	105	$	1	$	(250)	$	56	$	217
Total gains and (losses), realized and unrealized, included in:
Net income (loss) as:
Net investment income (loss)	—		—		—		—		7
Investment gains (losses), net	—		—		—		—		1
Subtotal	—		—		—		—		8
Other comprehensive income (loss)	—		—		—		—		—
Purchases	—		—		—		14		1
Sales	—		—		—		—		(8)
Settlements	—		—		—		—		—
Other	—		—		(2)		—		—
Activity related to consolidated VIEs/VOEs	1		—		—		—		—
Transfers into Level 3 (1)	—		—		—		—		(78)
Transfers out of Level 3 (1)	—		—		—		—		40
Balance, end of period	$	106	$	1	$	(252)	$	70	$	180
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—	$	7
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—	$	—


~~(1)~~	~~There is an investment expense that offsets this investment gain (loss).~~

______________

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.

(2)For instruments held as of September 30, 2023, amounts are included in net investment income or net derivative gains (losses) in the consolidated statements of income (loss) or unrealized gains (losses) on investments in the consolidated statements of comprehensive income.

(3)Other Equity Investments include other invested assets.

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	Three Months Ended September 30, 2022
	Corporate		State and Political Subdivisions		CMBS		Asset-backed		RMBS
	(in millions)
Balance, beginning of period	$	1,767	$	30	$	25	$	18	$	—
Total gains and (losses), realized and unrealized, included in:
Net income (loss) as:
Net investment income (loss)	1		—		—		—		—
Investment gains (losses), net	(3)		—		—		—		—
Subtotal	(2)		—		—		—		—
Other comprehensive income (loss)	(71)		(1)		—		1		—
Purchases	218		—		7		(3)		—
Sales	(34)		—		—		—		—
Settlements	—		—		—		—		—
Other	—		—		—		—		—
Activity related to consolidated VIEs/VOEs	—		—		—		—		—
Transfers into Level 3 (1)	25		—		—		—		—
Transfers out of Level 3 (1)	8		—		—		(6)		—
Balance, end of period	$	1,911	$	29	$	32	$	10	$	—
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	(70)	$	(1)	$	—	$	—	$	—

______________

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.

(2)For instruments held as of September 30, 2022, amounts are included in net investment income or net derivative gains (losses) in the consolidated statements of income (loss) or unrealized gains (losses) on investments in the consolidated statements of comprehensive income.

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	Three Months Ended September 30, 2022
	Other Equity Investments (3)		Separate Accounts Assets		Contingent Payment Arrangement		Trading Securities, at Fair Value		Fixed maturities, at FVO
	(in millions)
Balance, beginning of period	$	67	$	1	$	(42)	$	52	$	423
Total gains and (losses), realized and unrealized, included in:
Net income (loss) as:
Net investment income (loss)	(1)		—		—		—		(20)
Investment gains (losses), net	—		—		—		—		—
Subtotal	(1)		—		—		—		(20)
Other comprehensive income (loss)	—		—		—		—		—
Purchases	(49)		—		(228)		—		6
Sales	—		—		—		—		17
Settlements	—		—		—		—		—
Other	—		—		—		—		—
Activity related to consolidated VIEs/VOEs	—		—		(3)		—		—
Transfers into Level 3 (1)	—		—		—		—		(84)
Transfers out of Level 3 (1)	—		—		—		—		32
Balance, end of period	$	17	$	1	$	(273)	$	52	$	374
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	(1)	$	—	$	—	$	—	$	(20)
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—	$	—

______________

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.

(3)Other Equity Investments include other invested assets.

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	Nine Months Ended September 30, 2023
	Corporate		State and Political Subdivisions		CMBS		Asset-backed		RMBS
	(in millions)
Balance, beginning of period	$	2,121	$	28	$	32	$	—	$	34
Total gains and (losses), realized and unrealized, included in:
Net income (loss) as:
Net investment income (loss)	4		—		—		—		—
Investment gains (losses), net	(16)		—		—		—		—
Subtotal	(12)		—		—		—		—
Other comprehensive income (loss)	15		—		(1)		—		(1)
Purchases	539		—		19		10		40
Sales	(215)		(2)		—		—		—
Settlements	—		—		—		—		—
Other	—		—		—		—		—
Activity related to consolidated VIEs/VOEs	—		—		—		—		—
Transfers into Level 3 (1)	—		—		—		—		—
Transfers out of Level 3 (1)	(345)		—		—		—		(34)
Balance, end of period	$	2,103	$	26	$	50	$	10	$	39
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	9	$	—	$	(1)	$	—	$	(1)

______________

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.


	Nine Months Ended September 30, 2023
	Other Equity Investments (3)		Separate Accounts Assets		Contingent Payment Arrangement		Trading Securities, at Fair Value		Fixed maturities, at FVO
	(in millions)
Balance, beginning of period	$	17	$	1	$	(247)	$	55	$	224
Total gains and (losses), realized and unrealized, included in:
Net income (loss) as:
Net investment income (loss)	(3)		—		—		—		6
Investment gains (losses), net	—		—		—		—		(1)
Subtotal	(3)		—		—		—		5
Other comprehensive income (loss)	—		—		—		—		—
Purchases	44		—				15		75
Sales	—		—		—		—		(43)
Settlements	—		—		1		—		—
Other	—		—		(6)		—		—
Activity related to consolidated VIEs/VOEs	48		—		—		—		—
Transfers into Level 3 (1)	—		—		—		—		29
Transfers out of Level 3 (1)	—		—		—		—		(110)

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	Nine Months Ended September 30, 2023
	Other Equity Investments (3)		Separate Accounts Assets		Contingent Payment Arrangement		Trading Securities, at Fair Value		Fixed maturities, at FVO
Balance, end of period	$	106	$	1	$	(252)	$	70	$	180
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	(3)	$	—	$	—	$	—	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—	$	4

______________

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.

(3)Other Equity Investments include other invested assets.


	Nine Months Ended September 30, 2022
	Corporate		State and Political Subdivisions		Asset-backed		CMBS		RMBS
	(in millions)
Balance, beginning of period	$	1,504	$	35	$	8	$	20	$	—
Total gains and (losses), realized and unrealized, included in:
Net income (loss) as:
Net investment income (loss)	3		—		—		—		—
Investment gains (losses), net	(3)		—		—		—		—
Subtotal	—		—		—		—		—
Other comprehensive income (loss)	(152)		(5)		—		(2)		—
Purchases	777		—		9		14		—
Sales	(195)		(1)		(1)		—		—
Settlements	—		—		—		—		—
Other	—		—		—		—		—
Activity related to consolidated VIEs/VOEs	—		—		—		—		—
Transfers into Level 3 (1)	90		—		—		—		—
Transfers out of Level 3 (1)	(113)		—		(6)		—		—
Balance, end of period	$	1,911	$	29	$	10	$	32	$	—
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	(149)	$	(5)	$	—	$	(2)	$	—

______________

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	Nine Months Ended September 30, 2022
	Other Equity Investments (3)		Separate Accounts Assets		Contingent Payment Arrangement		Trading Securities, at Fair Value		Fixed maturities, at FVO
	(in millions)
Balance, beginning of period	$	16	$	1	$	(38)	$	65	$	201
Total gains and (losses), realized and unrealized, included in:
Net income (loss) as:
Net investment income (loss)	(1)		—		—		—		(20)
Investment gains (losses), net	—		—		—		(13)		—
Subtotal	(1)		—		—		(13)		(20)
Other comprehensive income (loss)	—		—		—		—		—
Purchases	8		—		(230)		—		159
Sales	—		—		—		—		(36)
Settlements	—		—		—		—		—
Other	—		—		—		—		—
Activity related to consolidated VIEs/VOEs	(3)		—		(5)		—		—
Transfers into Level 3 (1)	—		—		—		—		101
Transfers out of Level 3 (1)	(3)		—		—		—		(31)
Balance, end of period	$	17	$	1	$	(273)	$	52	$	374
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	(1)	$	—	$	—	$	(13)	$	(9)
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—	$	—

_____________

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.

(3)Other Equity Investments include other invested assets.

Quantitative and Qualitative Information about Level 3 Fair Value Measurements

The following tables disclose quantitative information about Level 3 fair value measurements by category for assets and ~~liabilities as of March 31, 2018 and December 31, 2017, respectively.~~

liabilities:

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

Quantitative Information about Level 3 Fair Value Measurements as of September 30, 2023

~~March 31, 2018~~

Fair
Value Valuation
Technique Significant
Unobservable Input Range Weighted Average
(in millions)
Assets:
Investments:
Fixed maturities, available-for-sale:
Corporate $ 52
Matrix pricing model Spread over the industry-Specific benchmark yield curve 0 - 565 bps 112 bps
788
Market comparable
companies EBITDA multiples
Discount rate
Cash flow multiples 6.2x - 30.7x
7.2% - 17.0%
9.0x - 17.7x 13x
11.3%
13.1x
Other equity investments 38
Discounted cash flow Earnings Multiple
Discounts factor
Discount years 10.8x
10.0%
12
Separate Accounts’ assets 332
Third party appraisal Capitalization Rate
Exit capitalization Rate
Discount Rate 4.6%
5.6%
6.6%
1
Discounted cash flow Spread over U.S. Treasury curve
Discount factor 228 bps
4.624%
GMIB reinsurance contract asset 1,734
Discounted cash flow Lapse Rates
Withdrawal Rates
Utilization Rates
Non-performance risk
Volatility rates - Equity 1% - 6.27% 0.63% -13.94% 0% - 16% 6 - 14 bps 11%-30%
Liabilities:
GMIBNLG 3,715
Discounted cash flow Non-performance risk
Lapse Rates
Withdrawal Rates
Annuitization
NLG Forfeiture Rates
Long-term equity Volatility 1.0%
0.8% - 26.2%
0.0% - 12.4%
0.0% - 16.0%
0.55% - 2.1%
20.0%
Assumed GMIB Reinsurance Contracts 173
Discounted cash flow Lapse Rates
Withdrawal Rates (Age 0-85)
Withdrawal Rates (Age 86+)
Utilization Rates
Non-performance risk
Volatility rates - Equity 1.1% - 13.3%
0.7% - 22.2%
1.3% - 100%
0% - 30%
1.47%
11%-30%
GWBL/GMWB 121
Discounted cash flow Lapse Rates
Withdrawal Rates
Utilization Rates
Volatility rates - Equity 0.5%-5.7% 0.0%-7.0% 100% after delay 11%-30%
GIB (36 ) Discounted cash flow Lapse Rates
Withdrawal Rates
Utilization Rates
Volatility rates - Equity 0.5%-5.7% 0%-8% 0% - 16% 11%-30%
GMAB 4
Discounted cash flow Lapse Rates
Volatility rates - Equity 0.5%-11.0% 11%-30%

Fair
Value

Valuation

Technique

Significant

Unobservable Input

Range

Weighted Average (2)

(Dollars in millions)

Assets:

Investments:

Fixed maturities, AFS:

Corporate

363

Matrix pricing model

Spread over Benchmark

20 bps - 295 bps

174 bps

985

Market comparable
companies

EBITDA multiples

Discount rate

Cash flow multiples

Loan to value

1.7x - 30.0x

0.0% - 22.3%

1.1x - 13.9x

0.0% - 59.5%

12.5x

11.7%

5.6x

39.0%

Trading securities, at fair value

Discounted cash flow

Earnings multiple

Discount factor

Discount years

8.3x

10.0%

Other equity investments

Discounted cash flow

Earnings Multiple

6.7x - 14.0x

7.0x

Purchased MRB asset (1) (2) (4)

8,745

Discounted cash flow

Lapse rates

Withdrawal rates

GMIB Utilization rates

Non-performance risk

Volatility rates - Equity

Mortality: Ages 0-40

Ages 41-60

Ages 61-115

0.21%-12.38%

0.07%-14.97%

0.04%-66.21%

48 bps - 118 bps

14%-27%

0.01%-0.18%

0.07%-0.53%

0.33%-42.00%

1.76%

0.52%

7.14%

50 bps

22%

3.01%

(same for all ages)

Liabilities:

AB Contingent consideration payable

252

Discounted cash flow

Expected revenue growth rates

Discount rate

2.0% - 83.9%

1.9% - 10.4%

10.3%

4.6%

Direct MRB (1) (2) (3) (4)

12,310

Discounted cash flow

Non-performance risk

Lapse rates

Withdrawal rates

Annuitization rates

Mortality: Ages 0-40

Ages 41-60

Ages 61-115

151 bps

0.21%-29.37%

0.00%-14.97%

0.04%-100.00%

0.01%-0.18%

0.07%-0.53%

0.33%-42.00%

151 bps

3.06%

0.61%

5.51%

2.55%

(same for all ages)

______________

(1)Mortality rates vary by age and demographic characteristic such as gender. Mortality rate assumptions are based on a combination of company and industry experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuating the embedded derivatives.

(2)Lapses and pro-rata withdrawal rates were developed as a function of the policy account value. Dollar for dollar withdrawal rates were developed as a function of the dollar for dollar threshold, the dollar for dollar limit. Utilization rates were developed as a function of the benefit base.

(3)MRB liabilities are shown net of MRB assets. Net amount is made up of $13.0 billion of MRB liabilities and $701 million of MRB assets.

(4)Includes Legacy and Core products.

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

Quantitative Information about Level 3 Fair Value Measurements

as of December 31, ~~2017~~2022

Fair
Value

Valuation
Technique

Significant
Unobservable Input

Range

Weighted Average (2)

(Dollars in millions)

Assets:

Investments:

Fixed maturities, AFS:

Corporate

417

Matrix pricing model

Spread over benchmark

20 bps - 797 bps

205 bps

1,029

Market comparable companies

EBITDA multiples

Discount rate

Cash flow multiples

Loan to value

5.3x - 35.8x

9.0% - 45.7%

0.0x-10.3x

0.0%-40.4%

13.6x

11.9%

6.1x

12.0%

Trading securities, at fair value

Discounted cash flow

Earnings multiple

Discounts factor

Discount years

8.3x

10.00%

Other equity investments

Market comparable companies

Revenue multiple

0.5x - 10.8x

2.4x

Purchased MRB asset (1) (2) (4)

10,423

Discounted cash flow

Lapse rates

Withdrawal rates

GMIB Utilization rates

Non-performance risk

Volatility rates - Equity

Mortality: Ages 0-40

Ages 41-60

Ages 61-115

0.26% - 26.23%

0.06% - 10.93%

0.04% - 66.66%

54 bps - 124 bps

14% - 32%

0.01% - 0.17%

0.06% - 0.52%

0.32% - 40.00%

1.58%

0.69%

7.39%

69 bps

24%

2.87%

(same for all ages)

Liabilities:

AB Contingent consideration payable

247

Discounted cash flow

Expected revenue growth rates

Discount rate

2.0% - 83.9%

1.9% - 10.4%

11.5%

4.5%

Direct MRB (1) (2) (3) (4)

15,276

Discounted cash flow

Non-performance risk

Lapse rates

Withdrawal rates

Annuitization rates

Mortality: Ages 0-40

Ages 41-60

Ages 61-115

157 bps

0.26% - 35.42%

0.00% - 10.93%

0.04% - 100.00%

0.01% - 0.17%

0.06% - 0.52%

0.32% - 40.00%

157 bps

3.01%

0.68%

5.53%

2.43%

(same for all ages)

______________

(1)Mortality rates vary by age and demographic characteristic such as gender and benefits elected with the policy. Mortality rate assumptions are based on a combination of company and industry experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuating the embedded derivatives.

(3)MRB liabilities are shown net of MRB assets. Net amount is made up of $15.8 billion of MRB liabilities and $490 million of MRB assets.

(4)Includes Legacy and Core products.

Fair
Value Valuation
Technique Significant
Unobservable Input Range Weighted Average
(in millions)
Assets:
Investments:
Fixed maturities, available-for-sale:
Corporate $ 53
Matrix pricing model Spread over the industry-specific benchmark yield curve 0 bps-565 bps 125 bps
789
Market comparable companies EBITDA multiples
Discount Rate
Cash flow Multiples 5.3x-27.9x
7.2% - 17.0%
9.0x - 17.7x 12.9x
11.1%
13.1x
Other equity investments 38
Discounted cash flow Earnings Multiple
Discounts factor
Discount years 10.8x 10.0% 12
Separate Accounts’ assets 326
Third party appraisal Capitalization Rate
Exit capitalization Rate
Discount Rate 4.6% 5.6% 6.6%
1
Discounted cash flow Spread over U.S. Treasury curve
Discount factor 243 bps 4.409%
GMIB reinsurance contract asset 1,894
Discounted Cash flow Lapse Rates
Withdrawal Rates
Utilization Rates
Non-performance risk
Volatility rates - Equity 1.0% - 6.3% 0.0% - 8.0% 0.0% - 16.0% 5bps - 10bps 9.9% - 30.9%
Liabilities:
GMIBNLG 4,056
Discounted cash flow Non-performance risk
Lapse Rates
Withdrawal Rates
Utilization Rates
NLG Forfeiture Rates
Long -term Equity Volatility 1.0% 0.8% - 26.2% 0.0% - 12.4% 0.0% - 16.0% 0.55% - 2.1% 20.0%
Assumed GMIB Reinsurance Contracts 194
Discounted cash flow Lapse Rates
Withdrawal Rates (Age 0-85)
Withdrawal Rates (Age 86+)
Utilization Rates
Non-performance risk
Volatility rates - Equity 1.1% - 13.3% 0.7% - 22.2% 1.3% - 100%
0 - 30% 1.3% 9.9% - 30.9%
GWBL/GMWB 130
Discounted cash flow Lapse Rates
Withdrawal Rates
Utilization Rates
Volatility rates - Equity 0.9% - 5.7% 0.0% - 7.0% 100% after delay 9.9% - 30.9%
GIB (27 ) Discounted cash flow Lapse Rates
Withdrawal Rates
Utilization Rates
Volatility rates - Equity 0.9% - 5.7% 0.0% - 7.0% 0.0% - 16.0% 9.9% - 30.9%
GMAB 5
Discounted cash flow Lapse Rates
Volatility rates - Equity 0.5% - 11.0% 9.9% - 30.9%

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

Level 3 Financial Instruments for which Quantitative Inputs are Not Available

Certain Privately Placed Debt Securities with Limited Trading Activity

Excluded from the tables above ~~at March 31, 2018~~as of September 30, 2023 and December 31, ~~2017,~~2022, respectively, are approximately ~~$1,087 million~~$1.2 billion and ~~$948 million~~$1.0 billion of Level 3 fair value measurements of investments for which the underlying quantitative inputs are not developed by the Company and are not readily available. The fair value measurements of these Level 3 investments comprise approximately 47.3% and 44.0% of total assets classified as Level 3 and represent only 0.6% and 0.5% of total assets measured at fair value on a recurring basis at March 31, 2018 and December 31, 2017, respectively. These investments primarily consist of certain privately placed debt securities with limited trading activity, including residential mortgage- and asset-backed instruments, and their fair values generally reflect unadjusted prices obtained from independent valuation service providers and indicative, non-binding quotes obtained from third-party broker-dealers recognized as market participants. Significant increases or decreases in the fair value amounts received from these pricing sources may result in the ~~Company’s~~Company reporting significantly higher or lower fair value measurements for these Level 3 investments.

~~Included in the tables above at March 31, 2018 and December 31, 2017, respectively, are approximately $840 million and $842 million fair value of loans classified as Level 3.~~ •The fair value of private placement securities is determined by application of a matrix pricing model or a market comparable company value ~~technique, representing approximately 67.0% and 73.2% of the total fair value of Level 3 securities in the corporate fixed maturities asset class.~~technique. The significant unobservable input to the matrix pricing model valuation technique is the spread over the industry-specific benchmark yield curve. Generally, an increase or decrease in spreads would lead to directionally inverse movement in the fair value measurements of these securities. The significant unobservable input to the market comparable company valuation technique is the discount rate. Generally, a significant increase (decrease) in the discount rate would result in significantly lower (higher) fair value measurements of these securities.

•Residential mortgage-backed securities classified as Level 3 primarily consist of non-agency paper with low trading activity. Included in the tables above ~~at March 31, 2018~~as of September 30, 2023 and December 31, ~~2017,~~2022, there were no Level 3 securities that were determined by application of a matrix pricing model and for which the spread over the U.S. Treasury curve is the most significant unobservable input to the pricing result. Generally, a change in spreads would lead to directionally inverse movement in the fair value measurements of these securities.

•Asset-backed securities classified as Level 3 primarily consist of non-agency mortgage loan trust certificates, including subprime and Alt-A paper, credit ~~tenant loans,~~risk transfer securities, and equipment financings. Included in the tables above ~~at March 31, 2018~~as of September 30, 2023 and December 31, ~~2017,~~2022, there were no securities that were determined by the application of matrix-pricing for which the spread over the U.S. Treasury curve is the most significant unobservable input to the pricing result. Significant increases (decreases) in spreads would ~~result~~have resulted in significantly lower (higher) fair value measurements.

Other Equity Investments

Included in other equity investments classified as Level 3 are ~~reporting entities’~~ venture capital securities in the Technology, Media and Telecommunications industries. The fair value measurements of these securities include significant unobservable inputs including an enterprise value to revenue multiples and a discount rate to account for liquidity and various risk factors. Significant increases (decreases) in the enterprise value to revenue multiple inputs in isolation would ~~result~~have resulted in a significantly higher (lower) fair value measurement. Significant increases (decreases) in the discount rate would ~~result~~have resulted in a significantly lower (higher) fair value measurement.

Separate Account assets classified as Level 3 in the table at March 31, 2018 and December 31, 2017, primarily consist of a private real estate fund with a fair value of approximately $332 million and $326 millionand mortgage loans with fair value of approximately $1 million and $1 million, respectively. A third party appraisal valuation technique is used to measure the fair value of the private real estate investment fund, including consideration of observable replacement cost and sales comparisons for the underlying commercial properties, as well as the results from applying a discounted cash flow approach. Significant increase (decrease) in isolation in the capitalization rate and exit capitalization rate assumptions used in the discounted cash flow approach to the appraisal value would result in a higher (lower) measure of fair value. With respect to the fair value measurement of mortgage loans a discounted cash flow approach is applied, a significant increase (decrease) in the assumed spread over U.S. Treasury securities would produce a lower (higher) fair value measurement. Changes in the discount rate or factor used in the valuation techniques to determine the fair values of these private equity investments and mortgage loans generally are not correlated to changes in the other significant unobservable inputs. Significant increase (decrease) in isolation in the discount rate or factor would result in significantly lower (higher) fair value measurements. The remaining Separate Account investments classified as Level

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

3 excluded from the table consist of mortgage- and asset-backed securities with fair values of approximately $15 million and $9 million at March 31, 2018 and $14 million and $8 million at December 31, 2017, respectively. These fair value measurements are determined using substantially the same valuation techniques as earlier described above for the Company’s General Account investments in these securities.Market Risk Benefits

Significant unobservable inputs with respect to the fair value measurement of the ~~Level 3 GMIB reinsurance contract asset~~purchased MRB assets and ~~the Level 3~~MRB liabilities identified in the table above are developed using ~~the~~ Company data. ~~Validations~~Future policyholder behavior is an unobservable market assumption and as such all aspects of ~~unobservable inputs~~policyholder behavior are ~~performed~~derived based on recent historical experience. These policyholder behaviors include lapses, pro-rata withdrawals, dollar for dollar withdrawals, GMIB utilization, deferred mortality and payout phase mortality. Many of these policyholder behaviors have dynamic adjustment factors based on the relative value of the rider as compared to the ~~extent~~account value in different economic environments. This applies to all variable annuity related products; products with GMxB riders including but not limited to GMIB, GMDB, and GWL.

Lapse rates are adjusted at the ~~Company has experience. When an input is changed~~contract level based on a comparison of the ~~model is updated~~value of the embedded GMxB rider and the ~~results of each step of the model are analyzed for reasonableness.~~

~~The significant unobservable inputs used in the fair~~current policyholder account value, ~~measurement of the Company’s GMIB reinsurance contract asset are~~which include other factors such as considering surrender charges. Generally, lapse rates ~~withdrawal rates and GMIB utilization rates. Significant increases~~are assumed to be lower in ~~GMIB utilization rates or decreases in lapse or withdrawal rates in isolation would tend to increase the GMIB reinsurance contract asset.~~

~~Fair value measurement of the GMIB reinsurance contract asset and liabilities includes~~periods when a surrender charge applies. A dynamic lapse ~~and GMIB utilization assumptions whereby projected contractual lapses and GMIB utilization reflect~~function reduces the ~~projected net amount of risks of the contract. As the net amount of risk of a contract increases, the assumed~~base lapse rate ~~decreases~~when the guaranteed amount is greater than the account value as in-the-money contracts are less likely to lapse. For valuing purchased MRB assets and ~~the GMIB utilization increases. Increases in volatility would increase the asset and liabilities.~~

~~The significant unobservable inputs used in the fair value measurement of the Company’s GMIBNLG liability are~~MRB liabilities, lapse rates ~~withdrawal rates, GMIB utilization rates, adjustment for Non-performance risk and NLG forfeiture rates. NLG forfeiture rates~~vary throughout the period over which cash flows are caused by excess withdrawals above the annual GMIB accrual rate that cause the NLG to expire. Significant decreases in lapse rates, NLG forfeiture rates, adjustment for non-performance risk and GMIB utilization rates would tend to increase the GMIBNLG liability, while decreases in withdrawal rates and volatility rates would tend to decrease the GMIBNLG liability.

The significant unobservable inputs used in the fair value measurement of the Company’s GMWB and GWBL liability are lapse rates and withdrawal rates. Significant increases in withdrawal rates or decreases in lapse rates in isolation would tend to increase these liabilities. Increases in volatility would increase these liabilities.

During 2017, AB made the final contingent consideration payment relating to its 2014 acquisition and recorded a change in estimate and wrote off the remaining contingent consideration payable relating to its 2010 acquisition. As of March 31, 2018 and December 31, 2017, one acquisition-related contingent consideration liability of $11 million remains relating to AB’s 2016 acquisition, which was valued using a revenue growth rate of 31.0% and a discount rate ranging from 1.4% to 2.3%.

The MLOA contingent payment arrangements associated with the Renewal Rights Agreement (with a fair value of $3 million as of March 31, 2018 is measured using projected premiums from these policies, net of potential surrenders and terminations, and applying a risk-adjusted discount factor (7% at March 31, 2018) to the resulting cash flows.

projected.

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

Carrying Value of Financial Instruments Not Otherwise Disclosed in Note 3 and Note 4 of the Notes to these Consolidated Financial Statements

The carrying values and fair values ~~at March 31, 2018 and December 31, 2017~~ for financial instruments not otherwise disclosed in Note 3 ~~are presented in~~and Note 4 of the ~~table below. Certain financial instruments are exempt from the requirements~~Notes to these Consolidated Financial Statements were as follows:

Carrying Values and Fair Values for Financial Instruments Not Otherwise Disclosed


	Carrying Value		Fair Value
			Level 1		Level 2		Level 3		Total
	(in millions)
September 30, 2023:
Mortgage loans on real estate	$	17,655	$	—	$	—	$	15,458	$	15,458
Policy loans	$	4,089	$	—	$	—	$	4,284	$	4,284
Policyholders’ liabilities: Investment contracts	$	1,707	$	—	$	—	$	1,519	$	1,519
FHLB funding agreements	$	8,178	$	—	$	8,074	$	—	$	8,074
FABN funding agreements	$	6,717	$	—	$	6,177	$	—	$	6,177
Funding agreement-backed commercial paper (FABCP)	$	788	$	—	$	788	$	—	$	788
Short-term debt (1)	$	—	$	—	$	—	$	—	$	—
Long-term debt	$	3,820	$	—	$	3,441	$	—	$	3,441
Separate Accounts liabilities	$	10,414	$	—	$	—	$	10,414	$	10,414


December 31, 2022:
Mortgage loans on real estate	$	16,481	$	—	$	—	$	14,690	$	14,690
Policy loans	$	4,033	$	—	$	—	$	4,349	$	4,349
Policyholders’ liabilities: Investment contracts	$	1,916	$	—	$	—	$	1,750	$	1,750
FHLB funding agreements	$	8,505	$	—	$	8,390	$	—	$	8,390
FABN funding agreements	$	7,095	$	—	$	6,384	$	—	$	6,384
Short-term debt (1)	$	520	$	—	$	518	$	—	$	518
Long-term debt	$	3,322	$	—	$	3,130	$	—	$	3,130
Separate Accounts liabilities	$	10,236	$	—	$	—	$	10,236	$	10,236

_____________

(1)As of September 30, 2023 and December 31, 2022, excludes CLO short-term debt of $0 million and $239 million, respectively which is inclusive as fair valued within notes issued by consolidated VIE’s, at fair value ~~disclosure, such as insurance liabilities other than financial guarantees and investment contracts, limited partnerships accounted for under~~using the ~~equity method and pension and other postretirement obligations.~~fair value option.

Carrying Value Fair Value
Level 1 Level 2 Level 3 Total
(in millions)
March 31, 2018:
Mortgage loans on real estate $ 11,333
$ —
$ —
$ 11,128
$ 11,128
Loans to affiliates 885
—
885
—
885
Policyholders’ liabilities: Investment contracts 2,222
—
—
2,283
2,283
FHLBNY Funding Agreements 3,014
—
2,962
—
2,962
Short term and long-term debt 2,373
—
2,449
—
2,449
Loans from affiliates 2,530
—
2,530
—
2,530
Policy loans 3,776
—
—
4,330
4,330
Separate Account Liabilities 7,647
—
—
7,647
7,647
December 31, 2017:
Mortgage loans on real estate $ 10,952
$ —
$ —
$ 10,912
$ 10,912
Loans to affiliates 1,230
—
1,230
—
1,230
Policyholders’ liabilities: Investment contracts 2,224
—
—
2,329
2,329
FHLBNY Funding Agreements 3,014
—
3,020
—
3,020
Short term and long-term debt 2,408
—
2,500
—
2,500
Loans from affiliates 3,622
—
3,622
—
3,622
Policy loans 3,819
—
—
4,754
4,754
Separate Account Liabilities 7,537
—
—
7,537
7,537
Mortgage Loans on Real Estate

Fair values for commercial, agricultural and ~~agricultural~~residential mortgage loans on real estate are measured by discounting future contractual cash flows to be received on the mortgage loan using interest rates at which loans with similar characteristics and credit quality would be made. The discount rate is derived ~~from taking~~based on the appropriate U.S. Treasury rate with a like term to the remaining term of the loan ~~and adding~~to which a spread reflective of the risk premium associated with the specific ~~loan.~~loan is added. Fair values for mortgage loans anticipated to be foreclosed and problem mortgage loans are limited to the fair value of the underlying collateral, if lower.

Fair values for the Company’s long-term debt related to real estate joint ventures are determined by a third party appraisal and assessed for reasonableness. The Company’s short-term debt primarily includes commercial paper with short term maturities and book value approximates fair value. The fair values of the Company’s borrowing and lending arrangements with AXA affiliated entities are determined in the same manner as for such transactions with third parties, including matrix pricing models for debt securities and discounted cash flow analysis for mortgage loans.Policy Loans

The fair value of policy loans is calculated by discounting expected cash flows based upon the U.S. ~~treasury~~Treasury yield curve and historical loan repayment patterns.

~~Fair~~Short-term Debt

The Company’s short-term debt primarily includes long-term debt that has been reclassified to short-term due to an upcoming maturity date within one year. The fair values for ~~FHLBNY funding agreements~~the Company’s short-term debt are determined ~~from a matrix~~by Bloomberg’s evaluated pricing ~~model and are internally assessed for reasonableness. The matrix pricing model for FHLBNY funding agreements utilizes an independently sourced U.S. Treasury curve~~service, which ~~is separately sourced from the Barclays’ suite of curves.~~

uses direct observations or observed comparables.

Table of Contents

~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

Long-term Debt

The fair values for the Company’s ~~association plans contracts, supplementary contracts not involving life contingencies (“SCNILC”),~~long-term debt are determined by Bloomberg’s evaluated pricing service, which uses direct observations or observed comparables.

FHLB Funding Agreements

The fair values of Equitable Financial’s FHLB long term funding agreements’ fair values are determined based on indicative market rates published by the FHLB, provided to AB and modeled for each note’s FMV. FHLB short-term funding agreements’ fair values are reflective of notional/par value plus accrued interest.

FABN Funding Agreements

The fair values of Equitable Financial’s FABN funding agreements are determined by Bloomberg’s evaluated pricing service, which uses direct observations or observed comparables.

FABCP Funding Agreements

The fair value of Equitable Financial’s FABCP funding agreements are reflective of the notional/par value outstanding.

Policyholder Liabilities - Investment Contracts and Separate Accounts Liabilities

The fair values for deferred annuities and certain annuities, which are included in ~~Policyholders’~~policyholders’ account balances, and liabilities for investment contracts with fund investments in Separate Accounts, are estimated using projected cash flows discounted at rates reflecting current market rates. Significant unobservable inputs reflected in the cash flows include lapse rates and withdrawal rates. Incremental adjustments may be made to the fair value to reflect non-performance risk. Certain other products such as the Company’s association plans contracts, supplementary contracts not involving life contingencies, Access Accounts and Escrow Shield Plus product reserves are held at book value.

Financial Instruments Exempt from Fair Value Disclosure or Otherwise Not Required to be Disclosed

Exempt from Fair Value Disclosure Requirements

~~8) REVENUE RECOGNITION~~Certain financial instruments are exempt from the requirements for fair value disclosure, such as insurance liabilities other than financial guarantees and investment contracts, limited partnerships accounted for under the equity method and pension and other postretirement obligations.

~~See Note 2, Significant Accounting Policies, Revenue Recognition, for descriptions of revenues presented~~Otherwise Not Required to be Included in the Table Above

The Company’s investment in COLI policies are recorded at their cash surrender value and therefore are not required to be included in the table ~~below~~above.

8) LIABILITIES FOR FUTURE POLICYHOLDER BENEFITS

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The following table reconciles the net liability for future policy benefits and ~~subject~~liability of death benefits to ~~contracts with customers determined~~the liability for future policy benefits in the consolidated balance sheets:


	September 30, 2023		December 31, 2022
	(in millions)
Reconciliation
Term	$	1,265	$	1,365
Individual Retirement - Payout	789		828
Legacy - Payout	3,192		2,689
Group Pension - Benefit Reserve & DPL	475		523
Health	1,437		1,558
UL	1,131		1,109
Subtotal	8,289		8,072
Whole Life Closed Block and Open Block products	5,502		5,664
Other (1)	922		908
Future policyholder benefits total	14,713		14,644
Other policyholder funds and dividends payable	1,934		1,959
Total	$	16,647	$	16,603

_____________

(1)Primarily consists of future policy benefits related to ~~be in-scope~~Protective Life and Annuity, Assumed Life and Disability, Group Life Run off, Variable Interest Sensitive Life rider and Employee Benefits.

The following table summarizes balances and changes in the liability for future policy benefits for nonparticipating traditional and limited pay contracts:


	Nine Months Ended September 30, 2023										Nine Months Ended September 30, 2022
	Protection Solutions		Individual Retirement		Legacy		Corporate & Other				Protection Solutions		Individual Retirement		Legacy		Corporate & Other
	Term		Payout		Payout		Group Pension		Health		Term		Payout		Payout		Group Pension		Health
	(in millions)
Present Value of Expected Net Premiums
Balance, beginning of period	$	2,100	$	—	$	—	$	—	$	(5)	$	2,485	$	—	$	—	$	—	$	22
Beginning balance at original discount rate	2,078		—		—		—		(5)		1,864		—		—		—		19
Effect of changes in cash flow assumptions	32		—		—		—		(8)		204		—		—		—		(10)
Effect of actual variances from expected experience	(14)		—		—		—		(6)		38		—		—		—		(12)
Adjusted beginning of period balance	2,096		—		—		—		(19)		2,106		—		—		—		(3)
Issuances	49		—		—		—		—		62		—		—		—		—
Interest accrual	76		—		—		—		(1)		73		—		—		—		—
Net premiums collected	(147)		—		—		—		2		(144)		—		—		—		1

Ending Balance at original discount rate	2,074		—		—		—		(18)		2,097		—		—		—		(2)
Effect of changes in discount rate assumptions	(82)		—		—		—		1		(5)		—		—		—		—
Balance, end of period	$	1,992	$	—	$	—	$	—	$	(17)	$	2,092	$	—	$	—	$	—	$	(2)

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	Nine Months Ended September 30, 2023										Nine Months Ended September 30, 2022
	Protection Solutions		Individual Retirement		Legacy		Corporate & Other				Protection Solutions		Individual Retirement		Legacy		Corporate & Other
	Term		Payout		Payout		Group Pension		Health		Term		Payout		Payout		Group Pension		Health
	(in millions)
Present Value of Expected Future Policy Benefits
Balance, beginning of period	$	3,465	$	828	$	2,689	$	523	$	1,553	$	4,294	$	1,114	$	2,547	$	683	$	2,092
Beginning balance of original discount rate	3,391		845		3,024		583		1,795		3,241		883		2,400		632		1,915
Effect of changes in cash flow assumptions	40		—		—		—		(12)		222		(1)		(1)		—		(5)
Effect of actual variances from expected experience	(16)		—		1		—		(5)		41		(1)		(2)		—		(10)
Adjusted beginning of period balance	3,415		845		3,025		583		1,778		3,504		881		2,397		632		1,900
Issuances	53		38		733		—		—		67		19		556		—		—
Interest accrual	126		29		65		15		43		125		30		47		16		46
Benefits payments	(254)		(69)		(199)		(50)		(111)		(283)		(74)		(143)		(53)		(124)

Ending Balance at original discount rate	3,340		843		3,624		548		1,710		3,413		856		2,857		595		1,822
Effect of changes in discount rate assumptions	(84)		(54)		(432)		(73)		(290)		37		(26)		(373)		(65)		(264)
Balance, end of period	$	3,256	$	789	$	3,192	$	475	$	1,420	$	3,450	$	830	$	2,484	$	530	$	1,558
Impact of flooring LFPB at zero	1		—		—		—		—		1		—		—		—		—
Net liability for future policy benefits	$	1,265	789		3,192		475		1,437		1,359		830		2,484		530		1,560
Less: Reinsurance recoverable	25		—		(777)		—		(1,145)		22		—		(365)		—		(1,248)
Net liability for future policy benefits, after reinsurance recoverable	$	1,290	$	789	$	2,415	$	475	$	292	$	1,381	$	830	$	2,119	$	530	$	312

Weighted-average duration of liability for future policyholder benefits (years)	7.1		9.3		7.7		7.1		8.7		7.1		9.5		8.2		7.2		8.8

The following table provides the ~~new guidance.~~amount of undiscounted and discounted expected gross premiums and expected future benefits and expenses related to nonparticipating traditional and limited payment contracts:


	September 30, 2023		December 31, 2022
	(in millions)
Term
Expected future benefit payments and expenses (undiscounted)	$	5,918	$	6,022
Expected future gross premiums (undiscounted)	7,039		7,273
Expected future benefit payments and expenses (discounted; AOCI basis)	3,255		3,465
Expected future gross premiums (discounted; AOCI basis)	3,610		3,904

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	September 30, 2023		December 31, 2022
	(in millions)
Payout - Legacy
Expected future benefit payments and expenses (undiscounted)	4,872		3,947
Expected future gross premiums (undiscounted)	—		—
Expected future benefit payments and expenses (discounted; AOCI basis)	3,105		2,607
Expected future gross premiums (discounted; AOCI basis)	—		—

Payout
Expected future benefit payments and expenses (undiscounted)	1,437		1,460
Expected future gross premiums (undiscounted)	—		—
Expected future benefit payments and expenses (discounted; AOCI basis)	759		801
Expected future gross premiums (discounted; AOCI basis)	—		—

Group Pension
Expected future benefit payments and expenses (undiscounted)	683		730
Expected future gross premiums (undiscounted)	—		—
Expected future benefit payments and expenses (discounted; AOCI basis)	456		563
Expected future gross premiums (discounted; AOCI basis)	—		—

Health
Expected future benefit payments and expenses (undiscounted)	2,375		2,510
Expected future gross premiums (undiscounted)	90		99
Expected future benefit payments and expenses (discounted; AOCI basis)	1,403		1,533
Expected future gross premiums (discounted; AOCI basis)	$	69	$	78

The table below summarizes the revenue and interest related to nonparticipating traditional and limited payment contracts:


	Nine Months Ended September 30,					Nine Months Ended September 30,
	2023		2022			2023		2022
	Gross Premium				Interest Accretion
	(in millions)
Revenue and Interest Accretion
Term	$	206	$	206		$	50	$	53
Payout - Legacy	99		76			74		47
Payout	36		17			29		30
Group Pension	—		—			15		16
Health	6		7			44		46
Total	$	347	$	306		$	212	$	192

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The following table provides the weighted average interest rates for the liability for future policy benefits:


	September 30, 2023		December 31, 2022
Weighted Average Interest Rate
Term
Interest accretion rate	5.6	%	5.7	%
Current discount rate	5.6	%	5.1	%
Payout - Legacy
Interest accretion rate	3.9	%	3.4	%
Current discount rate	5.7	%	5.0	%
Payout
Interest accretion rate	5.0	%	4.9	%
Current discount rate	5.8	%	5.2	%
Group Pension
Interest accretion rate	3.3	%	3.4	%
Current discount rate	5.7	%	5.1	%
Health
Interest accretion rate	3.4	%	3.3	%
Current discount rate	5.8	%	5.2	%

The following table provides the balance, changes in and the weighted average durations of the additional insurance liabilities:


	Nine months ended September 30,
		2023		2022
		Protection Solutions
		UL
		(Dollars in millions)
Balance, beginning of period		$	1,109	$	1,087
Beginning balance before AOCI adjustments		1,135		1,076
Effect of changes in interest rate & cash flow assumptions and model changes		(12)		8
Effect of actual variances from expected experience		14		11
Adjusted beginning of period balance		1,137		1,095
Interest accrual		38		36
Net assessments collected		50		49
Benefit payments		(39)		(45)

Ending balance before shadow reserve adjustments		1,186		1,135
Effect of reserve adjustment recorded in AOCI		(55)		(27)
Balance, end of period		$	1,131	$	1,108

Net liability for additional liability		$	1,131	$	1,108
Less: Reinsurance recoverable		—		—
Net liability for additional liability, after reinsurance recoverable		$	1,131	$	1,108

Weighted-average duration of additional liability - death benefit (years)		19.2		22.0

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The following tables provide the revenue, interest and weighted average interest rates, related to the additional insurance liabilities:


	Nine Months Ended September 30,
	2023		2022		2023		2022
	Assessments				Interest Accretion
	(in millions)
Revenue and Interest Accretion
UL	$	487	$	473	$	38	$	36
Total	$	487	$	473	$	38	$	36


	Nine Months Ended September 30,

		2023		2022

Weighted Average Interest Rate
UL		4.5	%	4.5	%
Interest accretion rate		4.5	%	4.5	%

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

9) MARKET RISK BENEFITS

The following table presents the ~~revenues recognized during~~balances and changes to the ~~three~~balances for market risk benefits for the GMxB benefits on deferred variable annuities:


	Three Months Ended September 30,
	2023								2022
	Individual Retirement		Legacy						Individual Retirement		Legacy
	GMxB Core		GMxB Legacy		Purchased MRB (3)		Net Legacy		GMxB Core		GMxB Legacy		Purchased MRB (3)		Net Legacy
	(in millions)
Balance, beginning of period	$	131	$	12,720	$	(9,923)	$	2,797	$	414	$	15,708	$	(11,725)	$	3,983
Balance BOP before changes in the instrument specific credit risk	351		14,142		(9,827)		4,315		779		17,735		(11,623)		6,112
Model changes and effect of changes in cash flow assumptions	20		(11)		(33)		(44)		(8)		404		(174)		230
Actual market movement effect	202		718		(300)		418		281		754		(259)		495
Interest accrual	22		213		(150)		63		13		224		(170)		54
Attributed fees accrued (1)	100		212		(66)		146		98		221		(69)		152
Benefit payments	(11)		(322)		190		(132)		(11)		(316)		184		(132)
Actual policyholder behavior different from expected behavior	7		(13)		(2)		(15)		11		42		(32)		10
Changes in future economic assumptions	(411)		(2,609)		1,511		(1,098)		(450)		(2,627)		1,513		(1,115)
Issuances	—		—		—		—		—		—		—		—
Balance EOP before changes in the instrument-specific credit risk	280		12,330		(8,677)		3,653		713		16,437		(10,630)		5,807
Changes in the instrument-specific credit risk (2)	38		(349)		(61)		(410)		(313)		(1,838)		(96)		(1,934)
Balance, end of period	$	318	$	11,981	$	(8,738)	$	3,243	$	400	$	14,599	$	(10,726)	$	3,873

Weighted-average age of policyholders (years)	64.2		72.9		72.5		N/A		63.3		72.4		71.9		N/A
Net amount at risk	$	3,598	$	23,123	$	12,188	N/A		$	3,788	$	23,933	$	12,364	N/A

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	Nine Months Ended September 30,
	2023								2022
	Individual Retirement		Legacy						Individual Retirement		Legacy
	GMxB Core		GMxB Legacy		Purchased MRB (3)		Net Legacy		GMxB Core		GMxB Legacy		Purchased MRB (3)		Net Legacy
	(in millions)
Balance, beginning of period	$	530	$	14,699	$	(10,415)	$	4,284	$	1,061	$	20,236	$	(14,059)	$	6,177
Balance BOP before changes in the instrument specific credit risk	529		15,314		(10,358)		4,956		666		19,719		(14,051)		5,668
Model changes and effect of changes in cash flow assumptions	20		(11)		(33)		(44)		(8)		317		(145)		172
Actual market movement effect	(128)		(662)		402		(260)		1,284		4,414		(1,672)		2,742
Interest accrual	60		604		(437)		167		30		507		(334)		173
Attributed fees accrued (1)	306		630		(207)		423		299		659		(216)		443
Benefit payments	(35)		(1,008)		560		(448)		(24)		(849)		472		(377)
Actual policyholder behavior different from expected behavior	19		1		(28)		(27)		16		101		(72)		29
Changes in future economic assumptions	(488)		(2,538)		1,424		(1,114)		(1,546)		(8,431)		5,388		(3,043)
Issuances	(3)		—		—		—		(4)		—		—		—
Balance EOP before changes in the instrument-specific credit risk	280		12,330		(8,677)		3,653		713		16,437		(10,630)		5,807
Changes in the instrument-specific credit risk (2)	38		(349)		(61)		(410)		(313)		(1,838)		(96)		(1,934)
Balance, end of period	$	318	$	11,981	$	(8,738)	$	3,243	$	400	$	14,599	$	(10,726)	$	3,873

Weighted-average age of policyholders (years)	64.2		72.9		72.5		N/A		63.3		72.4		71.9		N/A
Net amount at risk	$	3,598	$	23,123	$	12,188	N/A		$	3,788	$	23,933	$	12,364	N/A

_____________

(1)Attributed fees accrued represents the portion of the fees needed to fund future GMxB claims.

(2)Changes are recorded in OCI except for reinsurer credit which is reflected in the consolidated income statement.

(3)Purchased MRB is the impact of non-affiliated reinsurance.

The following table reconciles market risk benefits by the amounts in an asset position and amounts in a liability position to the market risk benefit amounts in the consolidated balance sheets:


	September 30, 2023										December 31, 2022
	Direct Asset		Direct Liability		Net Direct MRB		Purchased MRB		Total		Direct Asset		Direct Liability		Net Direct MRB		Purchased MRB		Total
	(in millions)
Individual Retirement
GMxB Core	$	(515)	$	833	$	318	$	—	$	318	$	(387)	$	917	$	530	$	—	$	530
Legacy Segment
GMxB Legacy	(129)		12,110		11,981		(8,738)		3,243		(51)		14,749		14,699		(10,412)		4,287
Other (1)	(57)		68		11		(7)		4		(52)		100		47		(11)		36
Total	$	(701)	$	13,011	$	12,310	$	(8,745)	$	3,565	$	(490)	$	15,766	$	15,276	$	(10,423)	$	4,853

______________

(1)Other primarily includes Individual EQUI-VEST MRB.

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

10) POLICYHOLDER ACCOUNT BALANCES

The following table reconciles the policyholders account balances to the policyholders’ account balance liability in the consolidated balance sheets:


	September 30, 2023		December 31, 2022
	(in millions)
Policyholders’ account balance reconciliation
Protection Solutions
Universal Life	$	5,236	$	5,340
Variable Universal Life	4,807		4,909
Legacy Segment
GMxB Legacy	644		688
Individual Retirement
GMxB Core	51		69
SCS	44,221		35,702
EQUI-VEST Individual	2,434		2,652
Group Retirement
EQUI-VEST Group	11,729		12,045
Momentum	628		702
Other (1)	6,409		6,118
Balance (exclusive of Funding Agreements)	76,159		68,225
Funding Agreements	15,753		15,641
Balance, end of period	$	91,912	$	83,866

_____________

(1)Primarily reflects products IR Payout, IR Other, Indexed Universal Life, Investment Edge, Group Pension, Closed Block and Corporate and Other.

The following table summarizes the balances and changes in policyholder’s account balances:


	Nine Months Ended September 30, 2023
	Protection Solutions				Legacy		Individual Retirement						Group Retirement
	Universal Life		Variable Universal Life		GMxB Legacy		GMxB Core		SCS (1)		EQUI-VEST Individual		EQUI-VEST Group		Momentum
	(Dollars in millions)
Balance, beginning of period	$	5,340	$	4,909	$	688	$	69	$	35,702	$	2,652	$	12,045	$	702
Issuances	—		—		—		—		—		—		—		—
Premiums received	528		107		70		163		5		27		460		49
Policy charges	(572)		(190)		9		2		(6)		—		(4)		—
Surrenders and withdrawals	(57)		(33)		(68)		(24)		(2,046)		(256)		(1,207)		(105)
Benefit payments	(169)		(84)		(75)		(1)		(194)		(56)		(54)		(4)
Net transfers from (to) separate account	—		(53)		—		(162)		7,366		7		210		(24)
Interest credited (2)	166		151		20		4		3,394		56		268		10
Other	—		—		—		—		—		4		11		—
Balance, end of period	$	5,236	$	4,807	$	644	$	51	$	44,221	$	2,434	$	11,729	$	628

Weighted-average crediting rate	3.75%		3.70%		2.71%		1.57%		N/A		2.90%		2.56%		2.33%
Net amount at risk (3)	$	36,003	$	115,752	$	23,123	$	3,598	$	31	$	126	$	51	$	—
Cash surrender value	$	3,450	$	3,201	$	607	$	273	$	40,156	$	2,427	$	11,672	$	630

______________

(1)SCS sales are recorded as a Separate Account liability until they are swept into the General Account. This sweep is recorded as Net Transfers from (to) separate account.

(2)SCS and EQUI-VEST Group includes amounts related to the change in embedded derivative.

(3)For life insurance products the net amount at risk is death benefit less account value for the policyholder. For variable annuity products the net amount at risk is the maximum GMxB NAR for the policyholder.

Table of Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	Nine Months Ended September 30, 2022
	Protection Solutions				Legacy		Individual Retirement						Group Retirement
	Universal Life		Variable Universal Life		GMxB Legacy		GMxB Core		SCS (1)		EQUI-VEST Individual		EQUI-VEST Group		Momentum
	(Dollars in millions)
Balance, beginning of period	$	5,462	$	4,807	$	745	$	112	$	33,443	$	2,784	$	11,951	$	704
Issuances	—		—		—		—		—		—		—		—
Premiums received	557		122		49		133		1		37		450		61
Policy charges	(595)		(181)		6		(17)		—		(1)		(5)		—
Surrenders and withdrawals	(68)		(12)		(43)		(23)		(1,931)		(131)		(611)		(100)
Benefit payments	(156)		(73)		(75)		(2)		(157)		(43)		(55)		(2)
Net transfers from (to) separate account	—		131		6		(115)		5,684		25		242		47
Interest credited (2)	168		117		22		5		(4,250)		60		142		11
Other	—		—		—		—		—		—		—		—
Balance, end of period	$	5,368	$	4,911	$	710	$	93	$	32,790	$	2,731	$	12,114	$	721

Weighted-average crediting rate	3.66%		3.69%		2.71%		1.05%		N/A		2.94%		2.55%		2.03%
Net amount at risk (3)	$	38,282	$	115,357	$	23,933	$	3,788	$	163	$	160	$	274	$	—
Cash surrender value	$	3,518	$	3,413	$	697	$	310	$	28,910	$	2,723	$	12,029	$	721

______________

(1)SCS sales are recorded as a Separate Account liability until they are swept into the General Account. This sweep is recorded as Net Transfers from (to) separate account.

(2)SCS and EQUI-VEST includes amounts related to the change in embedded derivative.

(3)For life insurance products, the net amount at risk is the death benefit less account value for the policyholder. For variable annuity products, the net amount at risk is the maximum GMxB NAR for the policyholder.

The following table presents the account values by range of guaranteed minimum crediting rates and the related range of the difference in basis points, between rates being credited policyholders and the respective guaranteed minimums:


September 30, 2023
Product (1)	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point - 50 Basis Points Above		51 Basis Points - 150 Basis Points Above		Greater Than 150 Basis Points Above		Total
( in millions)
Protection Solutions
Universal Life	0.00% - 1.50%	$	—	$	—	$	1	$	5	$	6
	1.51% - 2.50%	89		66		553		326		1,034
	Greater than2.50%	3,529		635		—		—		4,164
	Total	$	3,618	$	701	$	554	$	331	$	5,204

Variable Universal Life	0.00% - 1.50%	$	20	$	39	$	36	$	6	$	101
	1.51% - 2.50%	139		415		6		—		560
	Greater than 2.50%	3,701		—		12		5		3,718
	Total	$	3,860	$	454	$	54	$	11	$	4,379
Legacy Segment
GMxB Legacy	0.00% - 1.50%	$	81	$	16	$	—	$	—	$	97
	1.51% - 2.50%	23		—		—		—		23
	Greater than 2.50%	489		—		—		—		489
	Total	$	593	$	16	$	—	$	—	$	609

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


September 30, 2023
Product (1)	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point - 50 Basis Points Above		51 Basis Points - 150 Basis Points Above		Greater Than 150 Basis Points Above		Total
( in millions)
Individual Retirement
GMxB Core	0.00% - 1.50%	$	13	$	202	$	—	$	—	$	215
	1.51% - 2.50%	13		—		—		—		13
	Greater than 2.50%	54		—		—		—		54
	Total	$	80	$	202	$	—	$	—	$	282

EQUI-VEST Individual	0.00% - 1.50%	$	52	$	225	$	—	$	—	$	277
	1.51% - 2.50%	44		—		—		—		44
	Greater than 2.50%	2,112		—		—		—		2,112
	Total	$	2,208	$	225	$	—	$	—	$	2,433

Group Retirement
EQUI-VEST Group	0.00% - 1.50%	$	791	$	2,310	$	35	$	341	$	3,477
	1.51% - 2.50%	336		—		—		—		336
	Greater than 2.50%	6,845		—		—		—		6,845
	Total	$	7,972	$	2,310	$	35	$	341	$	10,658

Momentum	0.00% - 1.50%	$	—	$	12	$	337	$	55	$	404
	1.51% - 2.50%	148		1		—		—		149
	Greater than 2.50%	70		—		5		—		75
	Total	$	218	$	13	$	342	$	55	$	628

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


December 31, 2022
Product (1)	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point - 50 Basis Points Above		51 Basis Points - 150 Basis Points Above		Greater Than 150 Basis Points Above		Total
( in millions)
Protection Solutions
Universal Life	0.00% - 1.50%	$	—	$	—	$	5	$	1	$	6
	1.51% - 2.50%	181		197		605		47		1,030
	Greater than 2.50%	3,615		657		—		—		4,272
	Total	$	3,796	$	854	$	610	$	48	$	5,308

Variable Universal Life	0.00% - 1.50%	$	30	$	40	$	7	$	1	$	78
	1.51% - 2.50%	485		53		—		—		538
	Greater than 2.50%	3,900		—		2		—		3,902
	Total	$	4,415	$	93	$	9	$	1	$	4,518
Legacy Segment
GMxB Legacy	0.00% - 1.50%	$	386	$	—	$	—	$	—	$	386
	1.51% - 2.50%	560		—		—		—		560
	Greater than 2.50%	35		—		—		—		35
	Total	$	981	$	—	$	—	$	—	$	981
Individual Retirement
GMxB Core	0.00% - 1.50%	$	289	$	—	$	—	$	—	$	289
	1.51% - 2.50%	14		—		—		—		14
	Greater than 2.50%	—		—		—		—		—
	Total	$	303	$	—	$	—	$	—	$	303

EQUI-VEST Individual	0.00% - 1.50%	$	345	$	—	$	—	$	—	$	345
	1.51% - 2.50%	46		—		—		—		46
	Greater than 2.50%	2,199		—		62		—		2,261
	Total	$	2,590	$	—	$	62	$	—	$	2,652

SCS	Products with either a fixed rate or no guaranteed minimum	N/A		N/A		N/A		N/A		N/A



Group Retirement
EQUI-VEST Group	0.00% - 1.50%	$	109	$	5	$	366	$	3,112	$	3,592
	1.51% - 2.50%	11		2		889		—		902
	Greater than 2.50%	6,949		21		330		—		7,300
	Total	$	7,069	$	28	$	1,585	$	3,112	$	11,794

Momentum	0.00% - 1.50%	$	15	$	301	$	122	$	7	$	445
	1.51% - 2.50%	178		1		—		—		179
	Greater than 2.50%	73		—		5		—		78
	Total	$	266	$	302	$	127	$	7	$	702

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Separate Account - Summary

The following table presents the balances of and changes in Separate Account liabilities:


	Nine Months Ended September 30, 2023
	Protection Solutions		Legacy		Individual Retirement						Group Retirement
	VUL		GMxB Legacy		GMxB Core		EQUI-VEST Individual		Investment Edge		EQUI-VEST Group		Momentum
	(in millions)
Balance, beginning of period	$	13,187	$	32,616	$	27,772	$	4,161	$	3,798	$	22,393	$	3,885
Premiums and deposits	845		166		1,170		70		659		1,574		478
Policy charges	(419)		(495)		(365)		(2)		—		(13)		(15)
Surrenders and withdrawals	(415)		(2,001)		(1,898)		(293)		(291)		(1,218)		(529)
Benefit payments	(68)		(562)		(176)		(43)		(33)		(43)		(8)
Investment performance (1)	1,127		2,045		1,120		360		191		1,790		305
Net transfers from (to) general account	53		—		161		(7)		(363)		(210)		24
Other charges (2)	—		—		—		4		—		25		—
Balance, end of period	$	14,310	$	31,769	$	27,784	$	4,250	$	3,961	$	24,298	$	4,140

Cash surrender value	$	13,988	$	31,481	$	26,939	$	4,218	$	3,872	$	24,031	$	4,132

_____________

(1)Investment performance is reflected net of M&E fees.

(2)EQUI-VEST Individual and EQUI-VEST Group for the nine months ended ~~March 31, 2018~~September 30, 2023, amounts reflect a total special payment applied to the accounts of active clients as part of a previously disclosed settlement agreement between Equitable Financial Life Insurance Company and ~~2017, disaggregated~~the Securities & Exchange Commission.


	Nine Months Ended September 30, 2022
	Protection Solutions		Legacy		Individual Retirement						Group Retirement
	VUL		GMxB Legacy		GMxB Core		EQUI-VEST Individual		Investment Edge		EQUI-VEST Group		Momentum
	(in millions)
Balance, beginning of period	$	16,405	$	44,912	$	35,288	$	5,583	$	4,287	$	27,509	$	4,975
Premiums and deposits	827		183		1,162		102		663		1,545		480
Policy charges	(402)		(516)		(367)		(2)		1		(12)		(16)
Surrenders and withdrawals	(307)		(2,056)		(1,778)		(225)		(248)		(1,018)		(510)
Benefit payments	(85)		(537)		(172)		(41)		(26)		(47)		(9)
Investment performance (1)	(3,998)		(9)		115		(25)		(158)		(242)		(47)
Net transfers from (to) general account	(131)		(10,375)		(7,445)		(1,396)		(954)		(7,033)		(1,176)

Balance, end of period	$	12,309	$	31,602	$	26,803	$	3,996	$	3,565	$	20,702	$	3,697

Cash surrender value	$	12,039	$	31,301	$	25,903	$	3,965	$	3,470	$	20,482	$	3,692

______________

(1) Investment performance is reflected net of M&E fees.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The following table reconciles the Separate Account liabilities to the Separate Account liability balance in the consolidated balance sheets:


	September 30, 2023		December 31, 2022
	(in millions)
Separate Account Reconciliation
Protection Solutions
Variable Universal Life	$	14,310	$	13,187
Legacy Segment
GMxB Legacy	31,769		32,616
Individual Retirement
GMxB Core	27,784		27,772
EQUI-VEST Individual	4,250		4,161
Investment Edge	3,961		3,798
Group Retirement
EQUI-VEST Group	24,298		22,393
Momentum	4,140		3,885
Other (1)	7,065		7,041
Total	$	117,577	$	114,853

______________

(1)Primarily reflects Corporate and Other products and Group Retirement products including Association and Group Retirement Other.

The following table presents the aggregate fair value of Separate Account assets by major asset category:


	September 30, 2023
	Protection Solutions		Individual Retirement		Group Retirement		Corp & Other		Legacy Segment		Total
	(in millions)
Asset Type
Debt securities	$	53	$	1	$	19	$	7	$	—	$	80
Common Stock	59		33		457		1,558		—		2,107
Mutual Funds	14,650		37,285		29,733		695		31,784		114,147
Bonds and Notes	95		3		1		1,144		—		1,243
Total	$	14,857	$	37,322	$	30,210	$	3,404	$	31,784	$	117,577


	December 31, 2022
	Protection Solutions		Individual Retirement		Group Retirement		Corp & Other		Legacy Segment		Total
	(in millions)
Asset Type
Debt securities	$	58	$	1	$	17	$	8	$	—	$	84
Common Stock	41		32		430		1,686		—		2,189
Mutual Funds	13,498		36,860		27,639		773		32,625		111,395
Bonds and Notes	119		3		1		1,062		—		1,185
Total	$	13,716	$	36,896	$	28,087	$	3,529	$	32,625	$	114,853

Three Months Ended March 31,
2018 2017
(in millions)
Investment management, advisory and service fees:
Base fees $ 724
$ 643
Performance-based fees 6
6
Research services 114
113
Distribution services 180
166
Other revenues:
Shareholder services 20
18
Other 6
4
Total investment management and service fees $ 1,050
$ 950

Other income $ 112
$ 101

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

11) EMPLOYEE BENEFIT PLANS

~~AXA Financial and AXA Equitable Life~~Pension Plans

~~AXA~~Holdings and Equitable Life sponsors the AXA Equitable 401(k) Plan, a qualified defined contribution plan for eligible employees and financial professionals. The plan provides for both a company contribution and a discretionary profit-sharing contribution. Expenses associated with this 401(k) Plan were $9 million and $7 million in the three months ended March 31, 2018 and 2017, respectively.Financial Retirement Plans

~~AXA Financial~~Holdings sponsors the MONY Life Retirement Income Security Plan for Employees and ~~AXA~~ Equitable ~~Life~~Financial sponsors the ~~AXA~~ Equitable Retirement Plan (the ~~“AXA Equitable Life~~“Equitable Financial QP”), both of which are frozen qualified defined benefit plans covering eligible employees and financial professionals. These pension plans are non-contributory, and their benefits are generally based on a cash balance formula and/or, for certain participants, years of service and average

~~Table of Contents~~

earnings over a specified ~~period in the plans. AXA~~period. Holdings and Equitable Financial ~~and AXA Equitable Life~~ also sponsor certain nonqualified defined benefit ~~plans.~~

~~On March 13, 2018,~~plans, including the ~~Company signed a binding agreement with a third party insurer to purchase two single premium, non-participating group annuity contracts with~~Equitable Excess Retirement Plan, that provide retirement benefits in excess of the ~~intent of settling certain retiree liabilities~~amount permitted under the ~~MONY Life Retirement Income Security Plan for Employees and the AXA Equitable QP. Payment of the preliminary contribution amounts~~tax law for the ~~group annuity contracts was funded from plan assets on March 20, 2018, securing~~qualified plans. Holdings has assumed primary liability for both plans. Equitable Financial remains secondarily liable for its obligations under the ~~third party insurer’s irrevocable assumption of certain benefits obligations~~Equitable Financial QP and commitment to issue the group annuity contracts. The annuity purchase transaction and consequent transfer of approximately $254 million of the plans’ obligations to retirees or 10% of the aggregate pension benefit obligations resulted in a partial settlement of the plans. Following remeasurement of the plans’ assets and obligations on March 20, 2018, as requiredwould recognize such liability in the event of an accounting settlement, the Company recognized a pre-tax settlement loss of approximately $100 million, largely attributable to recognition of a pro-rata portion of the plans’ unamortized net actuarial losses accumulated in other comprehensive income.

ABHoldings does not perform.

AB maintains the Profit Sharing Plan for Employees of AB, a tax-qualified retirement plan for U.S. employees. Employer contributions under this plan are discretionary and generally are limited to the amount deductible for Federal income tax purposes.Retirement Plans

AB ~~also~~ maintains a qualified, non-contributory, defined benefit retirement plan covering current and former employees who were employed by AB in the United States prior to October 2, 2000 (the “AB Plan”). Benefits under the AB Plan are based on years of credited service, ~~and~~ average final base ~~salary.~~salary, and primary Social Security benefits. Service and compensation after December 31, 2008 are not taken into account in determining participants’ retirement benefits.

In the three months ended March 31, 2018, a $5 million cash contribution was made by AB to the AB Plan. Based on the funded status of the AB plan at March 31, 2018, no minimum contribution is required to be made in 2018 under ERISA, as amended by theNet Periodic Pension ~~Act, but management is currently evaluating if it will make contributions for the remainder of 2018.~~

~~Funding Policy~~

The Company’s funding policy for its qualified pension plans is to satisfy its funding obligations each year in an amount not less than the minimum required by the ERISA, as amended by the Pension Act, and not greater than the maximum it can deduct for Federal income tax purposes.

~~Table of Contents~~

Expense

Components of ~~certain benefit costs~~net periodic pension expense for the ~~Company~~Company’s plans were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022			2023		2022
	(in millions)
Service cost	$	2	$	2		$	6	$	6
Interest cost	31		21			93		49
Expected return on assets	(38)		(40)			(116)		(119)
Prior period service cost amortization	1		(1)			—		(2)
Actuarial (gain) loss	—		—			1		1
Net amortization	11		15			28		55

Net Periodic Pension Expense	$	7	$	(3)		$	12	$	(10)

Three Months Ended March 31,
2018 2017
(in millions)
Net Periodic Pension Expense:
(Qualified and Non-qualified Plans)
Service cost $ 2
$ 3
Interest cost 25
26
Expected return on assets (45 ) (43 )
Net amortization 29
32
Partial settlement 100
—
Total $ 111
$ 18
Net Postretirement Benefits Costs:
Service cost $ —
$ —
Interest cost 4
4
Net amortization 2
2
Total $ 6
$ 6
Net Postemployment Benefits Costs:
Service cost $ 1
$ 1
Interest cost —
—
Net amortization —
—
Total $ 1
$ 1

~~10) SHARE-BASED COMPENSATION PROGRAMS~~

AXA and the Company sponsor various share-based compensation plans for eligible employees, financial professionals and non-officer directors of Holdings and its subsidiaries. AB also sponsors its own equity compensation plan for certain of its employees.

~~Compensation costs for the three months ended March 31, 2018 and 2017 for share-based payment arrangements as further described herein are as follows:~~

Three Months Ended
March 31,
2018 2017
(in thousands)
Performance Shares $ 55
$ 5,710
Stock Options (Other than AB stock options) 114
19
Restricted Awards 12,484
7,693
Other compensation plans⁽¹⁾
(904 ) 293
Total Compensation Expenses $ 11,749
$ 13,715


~~(1)~~	~~Other compensation plans include Restricted Stock and Stock Appreciation Rights.~~

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~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~Performance Shares~~

~~Settlement of second tranche of the 2014 Grant in 2018.~~ On March 26, 2018, share distributions totaling approximately $21 million were made to active and former employees of in settlement of 0.8 million Performance Shares earned under the terms of the AXA Performance Share Plan 2014. On April 6, 2018, cash distributions of approximately $6 million were made to active and former financial professionals in settlement of 0.2 million Performance Units earned under the terms of the AXA Advisor Performance Unit Plan 2014.

~~AB Long-term Incentive Compensation Plans.~~ During the three months ended March 31, 2018 and 2017, respectively, AB purchased 0.1 million and 1.3 million units representing assignments of beneficial ownership of limited partnership interests in AB Holding (“AB Holding Units”) for $2 million and $31 million, respectively (on a trade date basis). There were no open-market purchases during the three months ended March 31, 2018. The three months ended March 31, 2017 amount reflects open-market purchases of 1.2 million AB Holding Units for $28 million, with the remainder relating to purchases of AB Holding Units from employees to allow them to fulfill statutory tax withholding requirements at the time of distribution of long-term incentive compensation awards.

During the three months ended March 31, 2018 and 2017, AB granted to employees and eligible Directors 1.1 million and 1.1 million restricted Holding awards, respectively. In the three months ended March 31, 2018 and 2017, AB used AB Holding Units repurchased during the period and newly issued AB Holding Units to fund the restricted AB Holding Unit awards.

During the three months ended March 31, 2018 and 2017, AB Holding issued 0.2 million and 0.3 million, respectively, upon exercise of options to buy AB Holding Units. AB Holding used the proceeds of $4 million and $5 million, respectively, received from employees as payment in cash for the exercise price to purchase the equivalent number of newly-issued AB Units.

~~11)~~12) INCOME TAXES

Income tax expense for the three and nine months ended ~~March 31, 2018~~September 30, 2023 and ~~2017~~2022 was computed using an estimated annual effective tax rate (“ETR”)., with discrete items recognized in the period in which they occur. The estimated ETR is revised, as necessary, at the end of successive interim reporting periods.

The Company adopted revised goodwill impairment guidance in the first quarter of 2017. Income tax expense for the three months ended March 31, 2017 includes an expense of $129 million related to the impairment of non-deductible goodwill.

~~12) RELATED PARTY TRANSACTIONS~~

The Company participates in certain cost sharing and service agreements with AXA and other non-consolidated affiliates, including technology, professional development and investment management agreements. The costs related to the cost sharing and service agreements are allocated based on methods that management believes are reasonable, including a review of the nature of such costs and the activities performed to support each company. There have been no material changes in these service agreements from those disclosed in the 2017 annual financial statements.

In October 2012, AXA Financial issued a note denominated in Euros in the amount of €300 million or $391 million to AXA Belgium S.A. (“AXA Belgium”). This note had an interest rate of Europe Interbank Offered Rate (“EURIBOR”) plus 1.15% and a maturity date of October 23, 2017. Concurrently, AXA Financial entered into a swap with AXA covering the exchange rate on both the interest and principal payments related to this note. The interest rate on the swap was 6-month LIBOR plus 1.475%. In October 2017, the note was extended to March 30, 2018. The extended note has a floating interest rate of 1-month EURIBOR plus 0.06% with a minimum rate of 0%. Concurrently, AXA Financial entered into a swap with AXA covering the exchange rate on both the interest and principal payments related to the extended note until March 30, 2018. Both the loan and the swap were repaid on March 29, 2018.

In 2017, Holdings repaid a $56 million 1.39% loan from AXA America Corporate Solutions, Inc. (“AXA CS”) originally made in 2015. In 2017, Holdings received a $100 million and $10 million loan from AXA CS. The loans had interest rates of 1.86% and 1.76%, respectively, and were repaid on their maturity date of February 5, 2018.

Holdings formerly held 78.99% of the shares of AXA CS, which holds certain AXA U.S. P&C business. AXA CS and its subsidiaries have been excluded from the historical Consolidated Financial Statements since they were operated independently from the other Holdings subsidiaries. In March 2018, the legal transfer of the AXA CS shares to AXA was executed for $630 million, and is presented as an increase to Total equity attributable to Holdings. To anticipate this transfer, inDuring the fourth quarter of ~~2017, AXA made~~2022, the Company established a ~~short-term loan~~valuation allowance of ~~$622~~$1.6 billion against its deferred tax asset related to unrealized capital losses in the available for sale securities portfolio. Adjustments to the valuation allowance due to changes in the portfolio’s unrealized capital loss are recorded in other comprehensive income. For the nine months ended September 30, 2023, the Company recorded a decrease to the valuation allowance of $136 million ~~3-month LIBOR plus 0.439%~~in other comprehensive income.

As of each reporting date, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. Adjustments to the valuation allowance due to new facts or evidence are recorded in net income. During the nine months ended September 30, 2023, the Company increased its borrowing capacity and available liquidity so that the Company now has the ability and intent to hold the underlying securities in its available for sale portfolio to recovery to the extent that additional deferred tax asset would be realized. Based on all available evidence, as of September 30, 2023, the Company concluded that approximately three quarters of the deferred tax asset related to unrealized tax capital losses is more-likely-than-not to be realized and a full valuation allowance is not necessary. For the three and nine months ended September 30, 2023, the Company recorded an

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~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

~~margin to Holdings (the “$622 Million Loan”). Holdings’ repayment obligation to AXA in respect of this loan was set off against AXA’s payment obligation to Holdings with respect~~increase to the ~~transfer~~valuation allowance of ~~AXA CS~~$20 million and a decrease of $970 million, respectively, in net income. A valuation allowance of $464 million remains against the portion of the deferred tax asset that is still not more-likely-than-not to be realized.

The Company uses the aggregate portfolio approach related to the stranded or disproportionate income tax effects in accumulated other comprehensive income related to available for sale securities. Under this approach, the disproportionate tax effect remains intact as long as the investment portfolio remains.

13) EQUITY

Preferred Stock

Preferred stock authorized, issued and outstanding was as follows:


	September 30, 2023			December 31, 2022
Series	Shares Authorized	Shares Issued	Shares Outstanding	Shares Authorized	Shares Issued	Shares Outstanding
Series A	32,000	32,000	32,000	32,000	32,000	32,000
Series B	20,000	20,000	20,000	20,000	20,000	20,000
Series C	12,000	12,000	12,000	12,000	12,000	12,000
Total	64,000	64,000	64,000	64,000	64,000	64,000

Dividends declared per share were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Series A dividends declared	$	328	$	328	$	984	$	984
Series B dividends declared	$	—	$	—	$	619	$	619
Series C dividends declared	$	269	$	269	$	806	$	806

Common Stock

Dividends declared per share of common stock were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Dividends declared	$	0.22	$	0.20	$	0.64	$	0.58

Share Repurchase

On February 9, 2022, the Company’s Board of Directors authorized a new $1.2 billion share repurchase program. Under this program, the Company may, from time to time purchase shares of its common stock through various means. The Company may choose to suspend or discontinue the repurchase program at any time. The repurchase program does not obligate the Company to purchase any particular number of shares. On February 9, 2023, the Company’s Board of Directors authorized a new $700 million share repurchase program. Under this program, the Company may, from time to time, purchase shares of its common stock through various means. The Company may choose to suspend or discontinue the repurchase program at any time. The repurchase program does not obligate the Company to purchase any particular number of shares. As of September 30, 2023, Holdings had authorized capacity of approximately $392 million remaining in its share repurchase program.

Holdings repurchased a total of 8.3 million and ~~AXA paid~~24.5 million shares of its common stock at an average price of $28.69 and $27.70 through open market repurchases, ASRs and privately negotiated transactions for the three and nine months ended September 30, 2023, respectively and repurchased a total of 7.0 million and 23.2 million shares of its common stock at an average price of $28.67 and $30.17 through open market repurchases, ASRs and privately negotiated transactions for the three and nine months ended September 30, 2022, respectively.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

During the three and nine months ended September 30, 2023, Holdings repurchased 3.4 million and 11.5 million shares, respectively, of its common stock through open market repurchases. During the $8three and nine months ended September 30, 2022, Holdings repurchased 4.7 million ~~balance in cash.~~and 12.6 million shares, respectively, of its common stock through open market repurchases.

Accelerated Share Repurchase Agreement

In September ~~2007, AXA~~2023, Holdings entered into an ASR with a third-party financial institution to repurchase an aggregate of $70 million of Holdings’ common stock. Pursuant to the ASR, Holdings made a pre-payment of $70 million and received initial delivery of 2.0 million Holdings’ shares. The ASR terminated in October 2023, at which time an additional 555,000 shares of common stock were received.

In June 2023, Holdings established an obligation to enter into an ASR with a ~~$700~~third-party financial institution to repurchase an aggregate of $70 million ~~5.40% Senior Unsecured Note from AXA Equitable.~~of Holdings’ common stock. Pursuant to the ASR, on July 6, 2023, Holdings made a pre-payment of $70 million and received initial delivery of 2.0 million shares. The ~~note pays interest semi-annually~~ASR terminated in August 2023, at which time an additional 464,000 shares of common stock were received.

In June 2023, Holdings entered into an ASR with a third-party financial institution to repurchase an aggregate of $75 million of Holdings’ common stock. Pursuant to the ASR, Holdings made a pre-payment of $75 million and ~~was scheduled~~received initial delivery of 2.4 million Holdings’ shares. The ASR terminated in July 2023, at which time an additional 369,000 shares of common stock were received.

In April 2023, Holdings entered into an ASR with a third-party financial institution to ~~mature on September 30, 2012. In March 2011,~~repurchase an aggregate of $75 million of Holdings’ common stock. Pursuant to the ~~maturity date~~ASR, Holdings made a pre-payment of ~~the note was extended to December 30, 2020~~$75 million and ~~the interest rate was increased to 5.70%.~~ received initial delivery of 2.4 million Holdings’ shares. The ASR terminated in May 2023, at which time an additional 598,000 shares of common stock were received.

In January ~~2018, AXA pre-paid $50~~2023, Holdings entered into an ASR with a third-party financial institution to repurchase an aggregate of $75 million of Holdings’ common stock. Pursuant to the ~~$700 million note.~~

~~In December 2008, AXA received~~ASR, Holdings made a ~~$500 million term loan from AXA Financial. In December 2014, AXA repaid $300 million on this term loan to AXA Financial plus accrued interest. This term loan has an interest rate~~pre-payment of ~~5.40% payable semi-annually with a maturity date of December 15, 2020. In January 2018, AXA pre-paid $150 million of the $500 million term loan.~~

~~In December 2013, Colisée Re issued a $145 million 4.75% Senior Unsecured Note to Holdings. The loan was scheduled to mature on December 19, 2028. This loan was repaid on March 26, 2018.~~

In March 2018, AXA Equitable Life sold its interest in two consolidated real estate joint ventures to AXA France for a total purchase price of approximately $143 million, which resulted in a pre-tax loss of $0.2$75 million and ~~the reduction~~received initial delivery of ~~$203~~2 million Holdings’ shares. The ASR terminated in March 2023, at which time an additional 424,000 shares of ~~long-term debt on the Company’s balance sheet for the first quarter of 2018.~~common stock were received.

~~In March 2018, AXA contributed the 0.5% noncontrolling interest in AXA Financial to Holdings, reflected as a $66 million capital contribution, resulting in AXA Financial being 100% owned by Holdings.~~

~~13) ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)~~Accumulated Other Comprehensive Income (Loss)

AOCI represents cumulative gains (losses) on items that are not reflected in ~~Net~~net income (loss). The balances were as ~~of March 31, 2018 and 2017 follow:~~follows:


	September 30		December 31,
	2023		2022
	(in millions)
Unrealized gains (losses) on investments	$	(10,067)	$	(9,324)
Market risk benefits - instrument-specific credit risk component	370		668
Liability for future policy benefits - current discount rate component	554		355
Defined benefit pension plans	(615)		(650)
Foreign currency translation adjustments	(96)		(91)
Total accumulated other comprehensive income (loss)	(9,854)		(9,042)
Less: Accumulated other comprehensive income (loss) attributable to noncontrolling interest	(52)		(50)
Accumulated other comprehensive income (loss) attributable to Holdings	$	(9,802)	$	(8,992)

March 31,
2018 2017
(in millions)
Unrealized gains (losses) on investments $ (130 ) $ 244
Foreign currency translation adjustments (40 ) (69 )
Defined benefit pension plans (822 ) (1,030 )
Total accumulated other comprehensive income (loss) (992 ) (855 )
Less: Accumulated other comprehensive (income) loss attributable to noncontrolling interest 46
64
Accumulated other comprehensive income (loss) attributable to Holdings $ (946 ) $ (791 )

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~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

The components of OCI, net of taxes were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Change in net unrealized gains (losses) on investments:
Net unrealized gains (losses) arising during the period	$	(2,102)	$	(3,195)	$	(1,231)	$	(12,929)
(Gains) losses reclassified into net income (loss) during the period (1)	274		246		374		679

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Net unrealized gains (losses) on investments	(1,828)		(2,949)		(857)		(12,250)
Adjustments for policyholders’ liabilities, DAC, insurance liability loss recognition and other	62		165		93		436
Change in unrealized gains (losses), net of adjustments (net of deferred income tax expense (benefit) of $(384), $(740), $(375) and $(3,141))	(1,766)		(2,784)		(764)		(11,814)
Change in LFPB discount rate and MRB credit risk, net of tax
Market risk benefits - change in instrument-specific credit risk (net of deferred income tax expense (benefit) of $(289), $(53), $(63) and $665)	(1,086)		(198)		(235)		2,501
Liability for future policy benefits - change in current discount rate (net of deferred income tax expense (benefit) of $52, $74, $42 and $299)	195		279		157		1,126
Change in defined benefit plans:
Reclassification to Net income (loss) of amortization of net prior service credit included in net periodic cost (3)	6		16		35		61
Change in defined benefit plans (net of deferred income tax expense (benefit) of $(2), $(4), $(9), and $(13))	6		16		35		61
Foreign currency translation adjustments:
Foreign currency translation gains (losses) arising during the period	(16)		(30)		(5)		(75)

Foreign currency translation adjustment	(16)		(30)		(5)		(75)
Total other comprehensive income (loss), net of income taxes	(2,667)		(2,717)		(812)		(8,201)
Less: Other comprehensive income (loss) attributable to noncontrolling interest	(7)		(12)		(2)		(28)
Other comprehensive income (loss) attributable to Holdings	$	(2,660)	$	(2,705)	$	(810)	$	(8,173)

______________

(1)See “Reclassification adjustment” in Note 3 of the Notes to these Consolidated Financial Statements. Reclassification amounts presented net of income tax expense (benefit) of $(73) million and $(99) million for the three and nine months ended ~~March 31, 2018~~September 30, 2023, respectively, and ~~2017 follow:~~

Three Months Ended March 31,
2018 2017
(in millions)
Foreign currency translation adjustments:
Foreign currency translation gains (losses) arising during the period $ (5 ) $ 8
(Gains) losses reclassified into net income (loss) during the period —
—
Foreign currency translation adjustment (5 ) 8
Net unrealized gains (losses) on investments:
Net unrealized gains (losses) arising during the period (86 ) 155
(Gains) losses reclassified into net income (loss) during the period⁽¹⁾
(1,223 ) (23 )
Net unrealized gains (losses) on investments (1,309 ) 132
Adjustments for policyholders’ liabilities, DAC, insurance liability loss recognition and other 349
(28 )
Change in unrealized gains (losses), net of adjustments (net of deferred income tax expense (benefit) of $(255) and $56) (960 ) 104
Change in defined benefit plans:
Less: reclassification adjustments to net income (loss) for:
Amortization of net actuarial (gains) losses included in:
Amortization of net prior service cost included in net periodic cost 133
25
Change in defined benefit plans (net of deferred income tax expense (benefit) of $35 and $12) 133
25
Total other comprehensive income (loss), net of income taxes (832 ) 137
Less: Other comprehensive (income) loss attributable to noncontrolling interest (6 ) (7 )
Other comprehensive income (loss) attributable to Holdings $ (838 ) $ 130


~~(1)~~	See “Reclassification adjustments” in Note 3. Reclassification amounts presented net of income tax expense (benefit) of $(325) million and $(13) million, for the three months ended March 31, 2018 and 2017, respectively.

$(65) million and $(180) million for the three and nine months ended September 30, 2022, respectively.

Investment gains and losses reclassified from AOCI to net income (loss) primarily consist of realized gains (losses) on sales and ~~OTTI~~credit losses of AFS securities and are included in ~~Total~~total investment gains (losses), net on the consolidated statements of income (loss). Amounts reclassified from AOCI to net income (loss) as related to defined benefit plans primarily consist of ~~amortizations~~amortization of net (gains) losses and net prior service cost (credit) recognized as a component of net periodic cost and reported in ~~Compensation~~compensation and ~~benefit expenses~~benefits in the consolidated statements of income (loss). Amounts presented in the table above are net of tax.

14) SHORT-TERM AND LONG-TERM DEBT

~~14)~~On January 11, 2023, the Company issued $500 million aggregate principal amount of senior notes (the “Senior Notes”). These amounts were recorded net of the underwriting discount and issuance costs of $5 million. The Company will pay semiannual interest on the Senior Notes on January 11 and July 11 of each year, commencing on July 11, 2023, and the Senior Notes will mature on January 11, 2033. The Senior Notes bear interest at 5.594% per annum. On any date prior to October 11, 2032, the Company may redeem some or all of the Senior Notes, subject to a make-whole provision. At any time on or after October 11, 2032, the Company may, at its option, redeem the Notes in whole or in part, at a price equal to 100% of the principal amount of the Senior Notes being redeemed plus accrued and unpaid interest thereon to the redemption date. The Senior Notes contain customary affirmative and negative covenants, including a limitation on certain liens and a limit on the Company’s ability to consolidate, merge, sell or otherwise dispose of all or substantially all of its assets. The Senior Notes also include customary events of default (with customary grace periods, as applicable), including provisions under which, upon the occurrence of an event of default, all outstanding Senior Notes may be accelerated.

Holdings Senior Notes Repayment

On April 20, 2018, Holdings issued $800 million aggregate principal amount of 3.9% Senior Notes due 2023. During 2021 Holdings made a principal pre-payment of $280 million on the 3.9% Senior Notes. The remaining balance was paid in full on the due date of April 20, 2023.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

15) REDEEMABLE NONCONTROLLING INTEREST

The changes in the components of redeemable noncontrolling interests were as follows:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Balance, beginning of period	$	531	$	348	$	455	$	468
Net earnings (loss) attributable to redeemable noncontrolling interests	6		(9)		24		(65)
Purchase/change of redeemable noncontrolling interests	99		15		157		(49)
Balance, end of period	$	636	$	354	$	636	$	354

16) COMMITMENTS AND CONTINGENT LIABILITIES

Litigation and Regulatory Matters

Litigation, regulatory and other loss contingencies arise in the ordinary course of the Company’s activities as a diversified financial services firm. The Company is a defendant in a number of litigation matters arising from the conduct of its business. In some of these matters, claimants seek to recover very large or indeterminate amounts, including compensatory, punitive, treble and exemplary damages. Modern pleading practice ~~in the U.S.~~ permits considerable

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~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

variation in the assertion of monetary damages and other relief. Claimants are not always required to specify the monetary damages they seek, or they may be required only to state an amount sufficient to meet a court’s jurisdictional requirements. Moreover, some jurisdictions allow claimants to allege monetary damages that far exceed any reasonably possible verdict. The variability in pleading requirements and past experience demonstrates that the monetary and other relief that may be requested in a lawsuit or claim often bears little relevance to the merits or potential value of a claim. Litigation against the Company includes a variety of claims including, among other things, insurers’ sales practices, alleged agent misconduct, alleged failure to properly supervise agents, contract administration, product design, features and accompanying disclosure, cost of insurance increases, ~~the use of captive reinsurers,~~ payments of death benefits and the reporting and escheatment of unclaimed property, alleged breach of fiduciary duties, alleged mismanagement of client funds and other ~~matters.~~

As with other financial services companies, the Company periodically receives informal and formal requests for information from various state and federal governmental agencies and self-regulatory organizations in connection with inquiries and investigations of the products and practices of the Company or the financial services industry. It is the practice of the Company to cooperate fully in these matters.

The outcome of a litigation or regulatory matter is difficult to predict, and the amount or range of potential losses associated with these or other loss contingencies requires significant management judgment. It is not possible to predict the ultimate outcome or to provide reasonably possible losses or ranges of losses for all pending regulatory matters, litigation and other loss contingencies. While it is possible that an adverse outcome in certain cases could have a material adverse effect upon the Company’s financial position, based on information currently known, management believes that neither the outcome of pending litigation and regulatory matters, nor potential liabilities associated with other loss contingencies, are likely to have such an effect. However, given the large and indeterminate amounts sought in certain litigation and the inherent unpredictability of all such matters, it is possible that an adverse outcome in certain of the Company’s litigation or regulatory matters, or liabilities arising from other loss contingencies, could, from time to time, have a material adverse effect upon the Company’s results of operations or cash flows in a particular quarterly or annual period.

For some matters, the Company is able to estimate a ~~possible~~ range of loss. For such matters in which a loss is probable, an accrual has been made. For matters where the Company ~~however,~~ believes a loss is reasonably possible, but not probable, no accrual is required. For matters for which an accrual has been made, but there remains a reasonably possible range of loss in excess of the amounts accrued or for matters where no accrual is required, the Company develops an estimate of the unaccrued amounts of the reasonably possible range of losses. As of ~~March 31, 2018,~~September 30, 2023, the Company estimates the aggregate range of reasonably possible losses, in excess of any amounts accrued for these matters as of such date, to be up to approximately ~~$90~~$250 million.

For other matters, the Company is currently not able to estimate the reasonably possible loss or range of loss. The Company is often unable to estimate the possible loss or range of loss until developments in such matters have provided sufficient information to support an assessment of the range of possible loss, such as quantification of a damage demand from plaintiffs, discovery from plaintiffs and other parties, investigation of factual allegations, rulings by a court on motions or appeals, analysis by experts and the progress of settlement discussions. On a quarterly and

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

annual basis, the Company reviews relevant information with respect to litigation and regulatory contingencies and updates the Company’s accruals, disclosures and reasonably possible losses or ranges of loss based on such reviews.

In July 2011, a derivative action was filed in the United States District Court for the District of New Jersey entitled Mary Ann Sivolella v. AXA Equitable Life Insurance Company and AXA Equitable Funds Management Group, LLC (“Sivolella Litigation”) and a substantially similar action was filed in January 2013 entitled Sanford et al. v. AXA Equitable FMG (“Sanford Litigation”). These lawsuits were filed on behalf of a total of twelve mutual funds and, among other things, seek recovery under (i) Section 36(b) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), for alleged excessive fees paid to AXA Equitable Life and AXA Equitable FMG for investment management services and administrative services and (ii) a variety of other theories including unjust enrichment. The Sivolella Litigation and the Sanford Litigation were consolidated and a 25-day trial commenced in January 2016 and concluded in February 2016. In August 2016, the District Court issued its decision in favor of AXA Equitable Life and AXA Equitable FMG, finding that the plaintiffs had failed to meet their burden to demonstrate that

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~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

AXA Equitable Life and AXA Equitable FMG breached their fiduciary duty in violation of Section 36(b) of the Investment Company Act or show any actual damages. In September 2016, the plaintiffs filed a motion to amend the District Court’s trial opinion and to amend or make new findings of fact and/or conclusions of law. In December 2016, the District Court issued an order denying the motion to amend and plaintiffs filed a notice to appeal the District Court’s decision to the U.S. Court of Appeals for the Third Circuit. We are vigorously defending this matter.

In April 2014, a lawsuit was filed in the United States District Court for the Southern District of New York, now entitled Ross v. AXA Equitable Life Insurance Company. The lawsuit is a putative class action on behalf of all persons and entities that, between 2011 and March 11, 2014, directly or indirectly, purchased, renewed or paid premiums on life insurance policies issued by AXA Equitable Life (the “Policies”). The complaint alleges that AXA Equitable Life did not disclose in its New York statutory annual statements or elsewhere that the collateral for certain reinsurance transactions with affiliated reinsurance companies was supported by parental guarantees, an omission that allegedly caused AXA Equitable Life to misrepresent its “financial condition” and “legal reserve system.” The lawsuit seeks recovery under Section 4226 of the New York Insurance Law of all premiums paid by the class for the Policies during the relevant period. In July 2015, the Court granted AXA Equitable Life’s motion to dismiss for lack of subject matter jurisdiction. In April 2015, a second action in the United States District Court for the Southern District of New York was filed on behalf of a putative class of variable annuity holders with “Guaranteed Benefits Insurance Riders,” entitled Calvin W. Yarbrough, on behalf of himself and all others similarly situated v. AXA Equitable Life Insurance Company. The new action covers the same class period, makes substantially the same allegations, and seeks the same relief as the Ross action. In October 2015, the Court, on its own, dismissed the Yarbrough litigation on similar grounds as the Ross litigation. In December 2015, the Second Circuit denied the plaintiffs motion to consolidate their appeals but ordered that the appeals be heard together before a single panel of judges. In February 2017, the Second Circuit affirmed the decisions of the district court in favor of AXA Equitable Life, and that decision is now final because the plaintiffs failed to file a further appeal.

In November 2014, a lawsuit was filed in the Superior Court of New Jersey, Camden County entitled Arlene Shuster, on behalf of herself and all others similarly situated v. AXA Equitable Life Insurance Company. This lawsuit is a putative class action on behalf of all AXA Equitable Life variable life insurance policyholders who allocated funds from their policy accounts to investments in AXA Equitable Life’s Separate Accounts, which were subsequently subjected to the volatility management strategy and who suffered injury as a result thereof. The action asserts that AXA Equitable Life breached its variable life insurance contracts by implementing the volatility management strategy. In February 2016, the Court dismissed the complaint. In March 2016, the plaintiff filed a notice of appeal. In April 2018, the Superior Court of New Jersey Appellate Division affirmed the trial court’s decision. In August 2015, another lawsuit was filed in Connecticut Superior Court, Judicial Division of New Haven entitled Richard T. O’Donnell, on behalf of himself and all others similarly situated v. AXA Equitable Life Insurance Company. This lawsuit is a putative class action on behalf of all persons who purchased variable annuities from AXA Equitable Life, which were subsequently subjected to the volatility management strategy and who suffered injury as a result thereof. Plaintiff asserts a claim for breach of contract alleging that AXA Equitable Life implemented the volatility management strategy in violation of applicable law. In November 2015, the Connecticut Federal District Court transferred this action to the United States District Court for the Southern District of New York. In March 2017, the Southern District of New York granted AXA Equitable Life’s motion to dismiss the complaint. In April 2017, the plaintiff filed a notice of appeal. In April 2018, the United States Court of Appeals for the Second Circuit reversed the trial court’s decision with instructions to remand the case to Connecticut state court. We are vigorously defending these matters.

In February 2016, a lawsuit was filed in ~~the United States District Court for~~ the Southern District of New York entitled Brach Family Foundation, Inc. v. AXA Equitable Life Insurance Company. This lawsuit is a putative class action brought on behalf of all owners of ~~universal life~~ UL policies subject to ~~AXA~~ Equitable ~~Life’s~~Financial’s COI rate increase. In early 2016, ~~AXA~~ Equitable ~~Life~~Financial raised COI rates for certain UL policies issued between 2004 and ~~2007,~~2008, which had both issue ages 70 and above and a current face value amount of $1 million and above. ~~In March 2018, plaintiff~~A second putative class action was filed in the District of Arizona in 2017 and consolidated with the Brach matter in federal court in New York. The consolidated amended ~~its~~class action complaint ~~to add two new plaintiffs, including the individual Malcolm Currie. The current complaint alleges~~alleged the following claims: breach of contract; misrepresentations ~~by AXA~~ in violation of Section 4226 of the New York Insurance Law; violations of New York General Business Law Section 349; and violations of the California Unfair Competition Law, and the California Elder Abuse Statute. Plaintiffs ~~seek~~sought: (a) compensatory damages, costs, and, pre- and post-judgment ~~interest,~~interest; (b) with

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~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

respect to their claim concerning Section 4226, a penalty in the amount of premiums paid by the plaintiffs and the putative ~~class,~~class; and (c) injunctive relief and attorneys’ fees in connection with their statutory claims. ~~Seven~~In August 2020, the federal district court issued a decision certifying nationwide breach of contract and Section 4226 classes, and a New York State Section 349 class. Owners of a substantial number of policies opted out of the Brach class action. Most opt-out policies are not yet the subject of litigation. Others filed suit previously, including three pending individual federal actions that were coordinated with the Brach action and contained similar allegations. In May 2023, the Brach class action and Equitable Financial informed the federal district court that they had mutually agreed to settle the class action, and in October 2023, the federal district court entered an order of final approval of the settlement agreement. Equitable Financial is fully accrued for the class settlement, which will have no impact on earnings or distributable cash projections. In October 2023, Equitable Financial and the three plaintiffs with individual federal actions coordinated with the Brach action informed the court that they had reached a settlement, and those actions were dismissed. Equitable Financial is likewise fully accrued for those individual settlements, which will have no impact on earnings or distributable cash projections. Equitable Financial has settled other actual and threatened litigations challenging the COI increase by individual policy owners and entities.

Finally, two actions are also pending against Equitable Financial in New York state court. In July 2022, the trial court in one of the New York state court actions, Hobish v. AXA Equitable Life Insurance Company, granted in ~~federal or~~significant part Equitable Financial’s motion for summary judgment and denied plaintiff’s cross motion. That plaintiff appealed but its appeal was denied by the state courts. They contain similar allegations as those in Brach as well as additional allegations for violations of various states’ consumer protection statutes and common law fraud. Pursuant to an October 2017 order, the putative class action and the four individual federal actions are consolidated for the purposes of coordinating pre-trial activities. We are in various stages of motion practice, and areappellate court. Equitable Financial is vigorously defending each of these matters.

~~Restructuring~~As with other financial services companies, Equitable Financial periodically receives informal and formal requests for information from various state and federal governmental agencies and self-regulatory organizations in connection with inquiries and investigations of the products and practices of the Company or the financial services industry. It is the practice of the Company to cooperate fully in these matters.

Obligations under Funding Agreements

Pre-Capitalized Trust Securities (“P-Caps”)

In April 2019, pursuant to separate Purchase Agreements among Holdings, Credit Suisse Securities (USA) LLC, as representative of the several initial purchasers, and the Trusts (as defined below), Pine Street Trust I, a Delaware statutory trust (the “2029 Trust”), completed the issuance and sale of 600,000 of its Pre-Capitalized Trust Securities redeemable February 15, 2029 (the “2029 P-Caps”) for an aggregate purchase price of $600 million and Pine Street Trust II, a Delaware statutory trust (the “2049 Trust” and, together with the 2029 Trust, the “Trusts”), completed the issuance and sale of 400,000 of its Pre-Capitalized Trust Securities redeemable February 15, 2049 (the “2049 P-Caps” and, together with the 2029 P-Caps, the “P-Caps”) for an aggregate purchase price of $400 million in each case to qualified institutional buyers in reliance on Rule 144A that are also “qualified purchasers” for purposes of Section 3(c)(7) of the Investment Company Act of 1940, as amended.

The ~~restructuring~~P-Caps are an off-balance sheet contingent funding arrangement that, upon Holdings’ election, gives Holdings the right over a ten-year period (in the case of the 2029 Trust) or over a thirty-year period (in the case of the 2049 Trust) to issue senior notes to these Trusts. The Trusts each invested the proceeds from the sale of their P-Caps in separate portfolios of principal and/or interest strips of U.S. Treasury securities. In return, Holdings will pay a semi-annual facility fee to the 2029 Trust and 2049 Trust calculated at a rate of 2.125% and 2.715% per annum, respectively, which will be applied to the unexercised portion of the contingent funding arrangement and Holdings will reimburse the Trusts for certain expenses. The facility fees are recorded in other operating costs and ~~liabilities associated with~~expenses in the ~~Company’s initiatives were as follows:~~consolidated statements of income (loss).

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Three Months Ended March 31, Twelve Months Ended December 31,
2018 2017
(in millions)
Severance
Balance, beginning of year $ 23
$ 22
Additions 7
17
Cash payments (3 ) (14 )
Other reductions —
(2 )
Balance, end of Year $ 27
$ 23

Three Months Ended March 31, Twelve Months Ended December 31,
2018 2017
(in millions)
Leases
Balance, beginning of year $ 165
$ 170
Expense incurred —
29
Deferred rent 2
10
Payments made (11 ) (48 )
Interest accretion 1
4
Balance, end of year $ 157
$ 165

~~Obligation under funding agreements~~Federal Home Loan Bank (“FHLB”)

As a member of the ~~FHLBNY, AXA~~FHLB, Equitable ~~Life~~Financial has access to collateralized borrowings. It also may issue funding agreements to the ~~FHLBNY.~~FHLB. Both the collateralized borrowings and funding agreements would require ~~AXA~~ Equitable ~~Life~~Financial to pledge qualified mortgage-backed assets and/or government securities as collateral. ~~AXA~~ Equitable ~~Life~~Financial issues short-term funding agreements to the ~~FHLBNY~~FHLB and uses the funds for asset, liability, and cash management purposes. ~~AXA~~ Equitable ~~Life~~Financial issues long-term funding agreements to the ~~FHLBNY~~FHLB and uses the funds for spread lending purposes. ~~For other instruments used for asset liability management purposes see “Derivative~~

Entering into FHLB membership, borrowings and ~~offsetting~~funding agreements requires the ownership of FHLB stock and the pledge of assets as collateral. Equitable Financial has purchased FHLB stock of $382 million and pledged collateral with a carrying value of $10.3 billion as of September 30, 2023.

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~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~liabilities” included in Note 3.~~ Funding agreements are reported in ~~Policyholders’~~policyholders’ account balances in the consolidated balance sheets. For other instruments used for asset/liability and cash management purposes, see “Offsetting of Financial Assets and Liabilities and Derivative Instruments” included in Note 4 of the Notes to these Consolidated Financial Statements. The table below summarizes the Company’s activity of funding agreements with the FHLB.

Change in FHLB Funding Agreements during the Nine Months Ended September 30, 2023


	Outstanding Balance at December 31, 2022		Issued During the Period		Repaid During the Period		Long-term Agreements Maturing Within One Year		Long-term Agreements Maturing Within Five Years		Outstanding Balance at September 30, 2023
	(in millions)
Short-term funding agreements:
Due in one year or less	$	6,130	$	46,499	$	(46,825)	$	656	$	—	$	6,460
Long-term funding agreements:
Due in years two through five	1,679		—		—		(645)		—		1,034
Due in more than five years	692		—		—		—		(11)		681
Total long-term funding agreements	2,371		—		—		(645)		(11)		1,715
Total funding agreements (1)	$	8,501	$	46,499	$	(46,825)	$	11	$	(11)	$	8,175

_____________

(1)The $3 million and $4 million difference between the funding agreements carrying value shown in fair value table for September 30, 2023 and December 31, 2022, respectively, reflects the remaining amortization of a hedge implemented and closed, which locked in the funding agreements borrowing rates.

Funding Agreement-Backed Notes Program (“FABN”)

Under the FABN program, Equitable Financial may issue funding agreements in U.S. dollar or other foreign currencies to a Delaware special purpose statutory trust (the “Trust”) in exchange for the proceeds from issuances of fixed and floating rate medium-term marketable notes issued by the Trust from time to time (the “Trust Notes”). The funding agreements have matching interest, maturity and currency payment terms to the applicable Trust Notes. The Company hedges the foreign currency exposure of foreign currency denominated funding agreements using cross currency swaps as discussed in Note 4 of the Notes to these Consolidated Financial Statements. As of September 30, 2023, the maximum aggregate principal amount of Trust Notes permitted to be outstanding at any one time is $10.0 billion. Funding agreements issued to the Trust, including any foreign currency transaction adjustments, are reported in policyholders’ account balances in the consolidated balance sheets. Foreign currency transaction adjustments to policyholder’s account balances are recognized in net income (loss) as an adjustment to interest credited to policyholders’ account balances and are offset in interest credited to policyholders’ account balances by a release of AOCI from deferred changes in fair value of designated and qualifying cross currency swap cash flow hedges. The table below summarizes Equitable Financial’s activity of funding agreements under the FABN program.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Outstanding balance at end of period Maturity of Outstanding balance Issued during the period Repaid during the period
March 31, 2018: (in millions)
Short-term FHLBNY funding agreements $ 500
less than one month $ 1,500
$ 1,500
Long-term FHLBNY funding agreements 1,417
less than 4 years —
—
204
Less than 5 years —
—
879
greater than five years —
—
Total long-term funding agreements 2,500
—
—
Total FHLBNY funding agreements at March 31, 2018 $ 3,000
$ 1,500
$ 1,500
December 31, 2017:
Short-term FHLBNY funding agreements $ 500
Less than one month $ 6,000
$ 6,000
Long-term FHLBNY funding agreements 1,244
Less than 4 years 324
—
377
Less than 5 years 303
—
879
Greater than five years 135
—
Total long-term funding agreements 2,500
762
—
Total FHLBNY funding agreements at December 31, 2017 $ 3,000
$ 6,762
$ 6,000
Change in FABN Funding Agreements during the Nine Months Ended September 30, 2023

~~Letters~~


	Outstanding Balance at December 31, 2022		Issued During the Period		Repaid During the Period		Long-term Agreements Maturing Within One Year		Long-term Agreements Maturing Within Five Years		Foreign Currency Transaction Adjustment		Outstanding Balance at September 30, 2023
	(in millions)
Short-term funding agreements:
Due in one year or less	$	1,500	$	—	$	(1,000)	$	500	$	—	$	—	$	1,000
Long-term funding agreements:
Due in years two through five	4,000		671		—		(500)		1,285		(11)		5,445
Due in more than five years	1,585		—		—		—		(1,285)		—		300
Total long-term funding agreements	5,585		671		—		(500)		—		(11)		5,745
Total funding agreements (1)	$	7,085	$	671	$	(1,000)	$	—	$	—	$	(11)	$	6,745

_____________

(1)The $28 million and $66 million difference between the funding agreements notional value shown and carrying value table as of ~~Credit~~September 30, 2023 and December 31, 2022, respectively, reflects the remaining amortization of the issuance cost of the funding agreements and the foreign currency transaction adjustment.

~~Holdings~~

Funding Agreement-Backed Commercial Paper Program

In May 2023, Equitable Financial and Equitable America established a funding agreement-backed commercial paper program (the “FABCP Program”), pursuant to which a special purpose limited liability company (the “SPLLC”) may issue commercial paper and deposit the proceeds with Equitable Financial or Equitable America pursuant to a funding agreement issued by Equitable Financial or Equitable America to the SPLLC. The current maximum aggregate principal amount permitted to be outstanding at any one time under the FABCP Program is $3.0 billion for Equitable Financial and $1.0 billion for Equitable America. As of September 30, 2023, Equitable Financial and Equitable America had ~~$4,489~~$788 million and $0 million outstanding under the program, respectively.

Credit Facilities

For information regarding activity pertaining to our credit facilities arrangements, see Note 14 of the Notes to these Consolidated Financial Statements.

Guarantees and Other Commitments

The Company provides certain guarantees or commitments to affiliates and others. As of September 30, 2023, these arrangements include commitments by the Company to provide equity financing of $1.4 billion to certain limited partnerships and real estate joint ventures under certain conditions. Management believes the Company will not incur material losses as a result of these commitments.

The Company had $17 million of undrawn letters of credit ~~issued in favor of third party beneficiaries, including $4,260 million at AXA Arizona RE relating~~related to reinsurance ~~assumed from AXA Equitable Life, USFL and MLOA at March 31, 2018.~~

~~Credit Facilities and Notes~~

All existing credit facilities at December 31, 2017 with AXA or guaranteed by AXA have been terminated prior to the IPO settlement. In February 2018, Holdings entered into the following credit facilities: (i) a $3.9 billion two-year senior unsecured delayed draw term loan agreement; (ii) a $500 million three-year senior unsecured delayed draw term loan agreement; and (iii) a $2.5 billion five-year senior unsecured revolving credit facility with a syndicateas of banks. In addition to the credit facilities, Holdings entered into letter of credit facilities with an aggregate principal amount of approximately $1.9 billion, primarily to be used to support our life insurance business reinsured to EQ AZ Life Re following the unwind of the reinsurance provided to AXA Equitable Life by AXA RE Arizona for certain variable annuities with GMxB features (the “GMxB Unwind”). As of March 31, 2018, there were no outstanding balances on these credit facilities.

~~Other Commitments~~

September 30, 2023. The Company had ~~$812 million (including $262 million with affiliates) and $712~~$726 million of commitments under ~~equity financing arrangements to certain limited partnership and~~ existing mortgage loan agreements ~~respectively, at March 31, 2018.~~as of September 30, 2023.

The Company is the obligor under certain structured settlement agreements it had entered into with unaffiliated insurance companies and beneficiaries. To satisfy its obligations under these agreements, the Company owns single premium annuities issued by previously wholly-owned life insurance subsidiaries. The Company has directed payment under these annuities to be made directly to the beneficiaries under the structured settlement agreements. A contingent liability exists with respect to these agreements should the previously wholly-owned subsidiaries be unable to meet their obligations. Management believes the need for the Company to satisfy those obligations is remote.

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~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

~~15)~~17) BUSINESS SEGMENT INFORMATION

As previously announced, effective January 1, 2023, our financial reporting presentation was revised to reflect the reorganization of the Company’s reportable segments to reflect how the Company’s chief operating decision maker now makes operating decisions and assesses performance. We now have six reportable segments. Prior period results have been revised in connection with updates to our reportable segments.

The ~~Company has four~~six reportable ~~segments:~~segments are: Individual Retirement, Group Retirement, Investment Management and Research, Protection Solutions, Wealth Management and ~~Protection Solutions.~~

The Company changed its segment presentation in the fourth quarter 2017. The segment disclosures are based on the intention to provide the users of the financial statements with a view of the business from the Company’s perspective. As a result, the Company determined that it is more useful for a user of the financial statements to assess the historical performance on the basis which management currently evaluates the business. The reportable segments are based on the nature of the business activities, as they exist as of the initial filing date.Legacy.

These segments reflect the manner by which the Company’s chief operating decision maker views and manages the business. A brief description of these segments follows:

•The Group Retirement segment offers tax-deferred investment and retirement ~~plans~~services or products to beplans sponsored by educational entities, municipalities, and not-for-profit entities, as well as small and medium-sized businesses.

•The Investment Management and Research segment provides diversified investment management, research, and related solutions globally to a broad range of clients through three main client ~~channels-~~channels - Institutional, Retail and Private Wealth ~~Management-and~~- and distributes its institutional research products and solutions through Bernstein Research Services.

•The Protection Solutions segment includes our life insurance and group employee benefits businesses. Our life insurance business offers a variety of ~~variable universal life, universal life~~VUL, UL and term life products to help affluent and high net worth individuals, as well as small and medium-sized business owners, with their wealth protection, wealth transfer and corporate needs. Our group employee benefits business offers a suite of dental, vision, life, and short- and long-term disability and other insurance products to small and medium-size businesses across the United States.

•The Wealth Management segment offers discretionary and non-discretionary investment advisory accounts, financial planning and advice, life insurance, and annuity products through Equitable Advisors.

•The Legacy segment primarily consists of the capital intensive fixed-rate GMxB business written in the Individual Retirement market prior to 2011. This business offered GMDB features in isolation or together with GMLB features. This business also historically offered variable annuities with four types of guaranteed living benefit riders: GMIB, GWBL/GMWB, and GMAB.

Measurement

Operating earnings (loss) is the financial measure which primarily focuses on the Company’s segments’ results of operations as well as the underlying profitability of the Company’s core business. By excluding items that can be distortive and unpredictable such as investment gains (losses) and investment income (loss) from derivative instruments, the Company believes operating earnings (loss) by segment enhances the understanding of the Company’s underlying drivers of profitability and trends in the Company’s segments.

In the first quarter of 2018, the Company revised its Operating earnings definition as it relates to the treatment of certain elements of the profitability of its variable annuity products with indexed-linked features to align to the treatment of its variable annuity products with GMxB features. In addition, adjustments for variable annuity products with index-linked features previously included within Other adjustments in the calculation of Non-GAAP Operating Earnings are now included with the adjustments for variable annuity products with GMxB features in the broader adjustment category, Variable annuity product features. In order to improve the consistency and comparability of the financial statements, management revised the Notes to the Consolidated Financial Statements for the six months ended June 30, 2017, nine months ended September 30, 2017 and the year ended December 31, 2017 to include the revisions discussed herein. See Note 17 to the Notes to Consolidated Financial Statements for details of the revisions.

Operating earnings is calculated by adjusting each segment’s ~~Net~~net income (loss) attributable to Holdings for the following items:

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

•Items related to ~~Variable~~variable annuity product features, which ~~include certain~~include: (i) changes in the fair value of market risk benefits and purchased market risk benefits, including the related attributed fees and claims, offset by derivatives and other securities ~~we use~~used to hedge ~~these features and changes~~the market risk benefits which result in residual net income volatility as the change in fair value of certain securities is reflected in OCI and due to our statutory capital hedge program; and (ii) market adjustments to deposit asset or liability accounts arising from reinsurance agreements which do not expose the ~~embedded derivatives~~reinsurer to a reasonable possibility of ~~our GMxB riders reflected within Variable annuity products’ net derivative results;~~a significant loss from insurance risk;

•Investment (gains) losses, which includes ~~other-than-temporary~~credit loss impairments of ~~securities,~~securities/investments, sales or disposals of securities/investments, realized capital gains/losses and valuation allowances;

~~Goodwill impairment, which includes a write-down~~

Table of ~~goodwill in first quarter of 2017.~~Contents

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

•Net actuarial (gains) losses, which includes actuarial gains and losses as a result of differences between actual and expected experience on pension plan assets or projected benefit obligation during a given period related to pension, other postretirement benefit obligations, and ~~one time~~the one-time impact of the settlement of ~~gains and losses;~~the defined benefit obligation;

•Other adjustments, which ~~includes~~primarily include restructuring costs related to severance and separation, lease write-offs related to non-recurring restructuring activities, COVID-19 related impacts, net derivative gains (losses) on certain Non-GMxB derivatives, net investment income from certain items including consolidated VIE investments, seed capital mark-to-market adjustments, unrealized gain/losses and ~~separation costs;~~realized capital gains/losses from sales or disposals of select securities, certain legal accruals; a bespoke deal to repurchase UL policies from one entity that had invested in numerous policies purchased in the life settlement market, which disposed of the risk of additional COI litigation by that entity related to those UL policies, impact of the annual actuarial assumption updates attributable to LFPB; and

•Income tax expense (benefit) related to the above items and non-recurring tax items, which includes the effect of uncertain tax positions for a given audit period and ~~permanent differences due~~a decrease of deferred tax valuation allowance.

The General Account investment portfolio is used to ~~goodwill impairment~~support the insurance and annuity liabilities of our Individual Retirement, Group Retirement, Protection Solutions and Legacy business segments.

In the ~~Tax Reform Act.~~third quarter 2023, the Company updated its operating earnings measure to exclude the impact of the annual actuarial assumption update attributable to LFPB as the majority of the earnings volatility attributable to these assumption updates relate to the Company’s Legacy and non-business segment products and as such do not represent the Company’s ongoing revenue generating activities or future business strategy, and impedes comparability of operating results period over period. Operating earnings were favorably impacted by this change in the amount of $61 million for the three and nine months ended September 30, 2023, respectively. The presentation of operating earnings in prior periods was not revised to reflect this modification because the impact to those periods was immaterial.

Revenues derived from any customer did not exceed 10% of revenues for the three and nine months ended ~~March 31, 2018~~September 30, 2023 and ~~2017.~~2022.

The Company accounts for inter-segment sales and transfers as if the sales or transfers were to third parties, that is, at current market prices.

The table below presents operating earnings (loss) by segment and Corporate and Other and a reconciliation to ~~Net~~net income (loss) attributable to ~~Holdings~~Holdings:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Net income (loss) attributable to Holdings	$	1,064	$	594	$	2,000	$	2,091
Adjustments related to:
Variable annuity product features (4)	(1,380)		(675)		(584)		(2,322)
Investment (gains) losses	411		333		554		890
Net actuarial (gains) losses related to pension and other postretirement benefit obligations	8		19		26		57
Other adjustments (1)	91		50		198		455
Income tax expense (benefit) related to above adjustments	183		58		(40)		194
Non-recurring tax items (3)	36		7		(936)		13
Non-GAAP Operating Earnings	$	413	$	386	$	1,218	$	1,378

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Operating earnings (loss) by segment:
Individual Retirement	$	210	$	183	$	644	$	572
Group Retirement	$	105	$	99	$	301	$	354
Investment Management and Research	$	99	$	94	$	297	$	331
Protection Solutions	$	34	$	30	$	23	$	137
Wealth Management	$	40	$	22	$	114	$	78
Legacy	$	41	$	50	$	146	$	170
Corporate and Other (2)	$	(116)	$	(92)	$	(307)	$	(264)

______________

(1)Includes certain legal accruals related to the COI litigation of $0 million and $35 million for the three and nine months ended ~~March 31, 2018~~September 30, 2023, respectively, and ~~2017, respectively:~~$2 million and $168 million for the three and nine months ended September 30, 2022, respectively. Includes policyholder benefit costs of $75 million for the nine months ended September 30, 2022 stemming from a deal to repurchase UL policies from one entity that had invested in numerous policies purchased in the life settlement market. Includes the impact of annual actuarial assumptions updates related to LFPB of $61 million for the three and nine months ended September 30, 2023. Prior period impact was immaterial and was not revised.

(2)Includes interest expense and financing fees of $54 million and $173 million for the three and nine months ended September 30, 2023, respectively, and $51 million and $156 million for the three and nine months ended September 30, 2022, respectively.

Three Months Ended March 31,
2018 2017
(in millions)
Net income (loss) attributable to Holdings $ 168
$ (290 )
Adjustments related to:
Variable annuity product features 212
291
Investment (gains) losses (102 ) 24
Goodwill impairment —
369
Net actuarial (gains) losses related to pension and other postretirement benefit obligations 131
34
Other adjustments 90
(21 )
Income tax expense (benefit) related to above adjustments (63 ) (235 )
Non-recurring tax items 28
132
Non-GAAP Operating Earnings $ 464
$ 304
Operating earnings (loss) by segment:
Individual Retirement $ 360
$ 202
Group Retirement 76
59
Investment Management and Research 81
32
Protection Solutions 23
39
Corporate and Other⁽¹⁾
(76 ) (28 )
(3)For the three and nine months ended September 30, 2023, non-recurring tax items reflect primarily the effect of uncertain tax positions for a given audit period and an increase of the deferred tax valuation allowance of $20 million and a decrease of $970 million, respectively.

~~Table~~(4)Includes the impact of ~~Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~


~~(1)~~	~~Includes interest expense of $44 million and $31 million, for the three months ended March 31, 2018 and 2017, respectively.~~

favorable assumption updates of $40 million for the three and nine months ended September 30, 2023. Includes the impact of unfavorable assumption updates of $204 million for the three and nine months ended September 30, 2022.

Segment revenues ~~are~~is a measure of the Company’s revenue by segment as adjusted to exclude certain items. The following table reconciles segment revenues to ~~Total~~total revenues by excluding the following items:

•Items related to variable annuity product features, which include certain changes in the fair value of the derivatives and other securities we use to hedge these features and changes in the fair value of the embedded derivatives reflected within the net derivative results of variable annuity product features;

•Investment ~~gains (losses),~~(gains) losses, which ~~include other-than-temporary~~includes credit loss impairments of ~~securities,~~securities/investments, sales or disposals of securities/investments, realized capital gains/losses and valuation allowances; ~~and~~

•Other adjustments, which primarily includes ~~the impact of adoption of revenue recognition standard ASC 606.~~

net derivative gains (losses) on certain Non-GMxB derivatives and net investment income from certain items including consolidated VIE investments, seed capital mark-to-market adjustments and unrealized gain/losses associated with equity securities. The table below presents revenues by segment ~~revenues~~and Corporate and Other:

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Segment revenues:
Individual Retirement (1)	$	693	$	512	$	1,928	$	1,490
Group Retirement (1)	267		287		771		920
Investment Management and Research (2) (4)	1,034		996		3,043		3,134
Protection Solutions (1)	822		759		2,373		2,357
Wealth Management (3)	390		353		1,143		1,097
Legacy (1)	198		204		607		618
Corporate and Other (1) (4)	257		222		800		645
Eliminations	(199)		(184)		(597)		(579)

Adjustments related to:
Variable annuity product features	1,380		675		584		2,322
Investment gains (losses), net	(411)		(333)		(554)		(890)
Other adjustments to segment revenues	(807)		(499)		(1,740)		(286)
Total revenues	$	3,624	$	2,992	$	8,358	$	10,828

______________

(1)Includes investment expenses charged by AB of $35 million and $104 million for the three and nine months ended ~~March 31, 2018~~September 30, 2023, respectively, and ~~2017:~~$28 million and $82 million for the three and nine months ended September 30, 2022, respectively, for services provided to the Company.

(2)Inter-segment investment management and other fees of $40 million and $120 million for the three and nine months ended September 30, 2023, respectively, and $34 million and $101 million for the three and nine months ended September 30, 2022, respectively, are included in segment revenues of the Investment Management and Research segment.

Three Months Ended March 31,
2018 2017
(in millions)
Segment revenues:
Individual Retirement⁽¹⁾
$ 729
$ 1,019
Group Retirement⁽¹⁾
238
227
Investment Management and Research⁽²⁾
909
743
Protection Solutions⁽¹⁾
809
789
Corporate and Other⁽¹⁾
288
340
Adjustments related to:
Variable annuity product features (197 ) (287 )
Investment gains (losses) 102
(24 )
Other adjustments to segment revenues (43 ) 23
Total revenues $ 2,835
$ 2,830


~~(1)~~	~~Includes investment expenses charged by AB of approximately $18 million and $17 million for the three months ended March 31, 2018 and 2017, respectively, for services provided to the Company.~~


~~(2)~~	Inter-segment investment management and other fees of approximately $25 million and $24 million for the three months ended March 31, 2018 and 2017, respectively, are included in total revenues of the Investment Management and Research segment.

(3)Inter-segment distribution fees of $185 million and $553 million for the three and nine months ended September 30, 2023, respectively, and $178 million and $561 million for the three and nine months ended September 30, 2022, respectively, are included in segment revenues of the Wealth Management segment.

(4)Includes interest expense charged to AB of $10 million and $29 million for the three and nine months ended September 30, 2023, respectively, and $0 million and $0 million for the three and nine months ended September 30, 2022, respectively.

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~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~The table below presents~~ Total assets by segment were as ~~of March 31, 2018 and December 31, 2017:~~follows:



	September 30, 2023		December 31, 2022
	(in millions)
Total assets by segment:
Individual Retirement	$	83,581	$	77,641
Group Retirement	44,104		42,421
Investment Management and Research	11,262		12,633
Protection Solutions	36,423		37,224
Wealth Management	255		137
Legacy	45,902		48,231
Corporate and Other	38,725		34,415
Total assets	$	260,252	$	252,702

March 31,
2018 December 31,
2017
(in millions)
Total assets by segment:
Individual Retirement $ 103,786
$ 121,723
Group Retirement 43,615
38,578
Investment Management and Research 11,809
8,297
Protection Solutions 51,457
43,116
Corporate and Other 21,627
23,934
Total assets $ 232,294
$ 235,648

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

~~16) EARNINGS PER SHARE~~

~~Basic earnings per share (“EPS”~~18) INSURANCE GROUP STATUTORY FINANCIAL INFORMATION

In May 17, 2023, Equitable Financial entered into a reinsurance agreement (the “Reinsurance Treaty”) ~~is calculated by dividing~~with its affiliate, Equitable America, effective April 1, 2023. Pursuant to the Reinsurance Treaty, virtually all of Equitable Financial’s net retained General Account liabilities, including all of its net retained liabilities relating to the living benefit and death riders related to (i) its variable annuity contracts issued outside the State of New York prior to October 1, 2022 (and with respect to its EQUI-VEST variable annuity contracts, issued outside the State of New York prior to February 1, 2023) and (ii) certain universal life insurance policies issued outside the State of New York prior to October 1, 2022, were reinsured to Equitable America on a coinsurance funds withheld basis. In addition, all of the Separate Accounts liabilities relating to such variable annuity contracts were reinsured to Equitable America on a modified coinsurance basis. Equitable America’s obligations under the Reinsurance Treaty are secured through Equitable Financial’s retention of certain assets supporting the reinsured liabilities. This reinsurance treaty has no impact to the consolidated financial statements of the Company. The NYDFS and the Arizona Department of Insurance and Financial Institutions each approved the Reinsurance Treaty.

Prescribed and Permitted Accounting Practices

As of September 30, 2023, the following four prescribed and permitted practices resulted in net income (loss) ~~attributable to Holdings common shareholders~~and capital and surplus that is different from the statutory surplus that would have been reported had NAIC statutory accounting practices been applied.

Equitable Financial was granted a permitted practice by the ~~weighted-average number~~NYDFS to apply SSAP 108, Derivatives Hedging Variable Annuity Guarantees on a retroactive basis from January 1, 2021 through June 30, 2021, after reflecting the impacts of ~~common shares outstanding during~~our reinsurance transaction with Venerable. The permitted practice was amended to also permit Equitable Financial to adopt SSAP 108 prospectively as of July 1, 2021 and to consider the ~~period. Diluted EPS is calculated by dividing~~impact of both the ~~net income (loss) attributable~~interest rate derivatives and the general account assets used to ~~Holdings common shareholders adjusted for~~fully hedge the ~~incremental dilution from AB~~interest rate risk inherent in its variable annuity guarantees when determining the amount of the deferred asset or liability under SSAP 108. Application of the permitted practice partially mitigates the New York Insurance Regulation 213 (“Reg 213”) impact of the Venerable Transaction on Equitable Financial’s statutory capital and surplus and enables Equitable Financial to more effectively neutralize the impact of interest rates on its statutory surplus and to better align with our economic hedging program. The impact of applying this permitted practice relative to SSAP 108 as written was a decrease of approximately $15 million in statutory special surplus funds as of September 30, 2023. The Reinsurance Treaty reduced the amount of interest rate hedging needed at Equitable Financial going forward, affecting future deferrals, but leaves our historical SSAP 108 deferred amounts unchanged. The permitted practice also reset Equitable Financial’s unassigned surplus to zero as of June 30, 2021 to reflect the transformative nature of the Venerable Transaction.

The NAIC Accounting Practices and Procedures manual (“NAIC SAP”) has been adopted as a component of prescribed or permitted practices by the ~~weighted-average number~~State of ~~common shares used~~New York. However, Reg 213 adopted in May of 2019 and as amended in February 2020 and March 2021, differs from the ~~basic EPS calculation.~~NAIC variable annuity reserve and capital framework. Reg 213 requires Equitable Financial to carry statutory basis reserves for its variable annuity contract obligations equal to the greater of those required under (i) the NAIC standard or (ii) a revised version of the NYDFS requirement in effect prior to the adoption of the first amendment for contracts issued prior to January 1, 2020, and for policies issued after that date a new standard that in current market conditions imposes more conservative reserving requirements for variable annuity contracts than the NAIC standard.

The impact of the application of Reg 213 was a decrease of approximately $279 million in statutory surplus as of September 30, 2023 compared to statutory surplus under the NAIC variable annuity framework. Our hedging program is designed to hedge the economics of our insurance liabilities and largely offsets Reg 213 and NAIC framework reserve movements due to interest rates and equities. The NYDFS allows domestic insurance companies a five year phase-in provision for Reg 213 reserves. As of September 30, 2022, Equitable Financial’s Reg 213 reserves were 100% phased-in. As of September 30, 2023, given the prevailing market conditions and business mix, there are $267 million Reg 213 redundant reserves over the US RBC CTE 98 total asset requirement (“TAR”).

During the fourth quarter 2020, Equitable Financial received approval from NYDFS for its proposed amended Plan of Operation for Separate Account No. 68 (“SA 68”) for our Structured Capital Strategies product and Separate Account No. 69 (“SA 69”) for our EQUI-VEST product Structured Investment Option, to change the accounting basis of these two non-insulated Separate Accounts from fair value to book value in accordance with Section 1414 of the Insurance Law to align with how we manage and measure our overall general account asset portfolio. In order to facilitate this change and comply with Section 4240(a)(10), the Company also sought approval to amend the Plans to remove the

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

requirement to comply with Section 4240(a)(5)(iii) and substitute it with a commitment to comply with Section 4240(a)(5)(i). Similarly, the Company updated the reserves section of each Plan to reflect the fact that Regulation 128 would no longer be applicable upon the change in accounting basis. We applied this change effective January 1, 2021. The impact of the application is an increase of approximately $2.4 billion in statutory surplus as of September 30, 2023.

During 2022, Equitable Life Financial Insurance Company of America received approval from the Arizona Department of Insurance and Financial Institutions pursuant to A.R.S. 20-515 for Separate Account No. 68A (“SA 68A”) for our Structured Capital Strategies product, Separate Account No. 69A (“SA 69A”) for our EQUI-VEST product Structured Investment Option and Separate Account No. 71A (“SA 71A”) for our Investment Edge Structured Investment Option, to permit us to use book value as the accounting basis of these three non-insulated Separate Accounts instead of fair value in accordance with the NAIC Accounting and Practices and Procedures Manual to align with how we manage and measure our overall general account asset portfolio. The impact of the application is an increase of approximately $46 million in statutory surplus as of September 30, 2023.

19) EARNINGS PER COMMON SHARE

The following table presents ~~the weighted average~~a reconciliation of net income (loss) and weighted-average common shares used in calculating basic and diluted earnings per common share:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions, except per share data)
Weighted-average common shares outstanding:
Weighted-average common shares outstanding — basic	346.4		374.5		354.4		380.6
Effect of dilutive potential common shares:
Employee share awards (1)	1.6		2.3		1.4		2.3
Weighted-average common shares outstanding — diluted	348.0		376.8		355.9		382.9

Net income (loss):
Net income (loss)	$	1,135	$	648	$	2,232	$	2,256
Less: Net income (loss) attributable to the noncontrolling interest	71		54		232		165
Net income (loss) attributable to Holdings	1,064		594		2,000		2,091
Less: Preferred stock dividends	14		14		54		54
Net income (loss) available to Holdings’ common shareholders	$	1,050	$	580	$	1,946	$	2,037

Earnings per common share:
Basic	$	3.03	$	1.55	$	5.49	$	5.35
Diluted	$	3.02	$	1.54	$	5.47	$	5.32

Three Months Ended March 31,
2018 2017
(in millions)
Weighted Average Shares:
Weighted average common stock outstanding for basic and diluted earnings per common share 561
561
_____________

~~The following table presents~~(1)Calculated using the ~~reconciliation of~~treasury stock method.

For the ~~numerator for the basic~~three and ~~diluted net income per share calculations:~~

Three Months Ended March 31,
2018 2017
(in millions)
Net income (loss) attributable to Holdings common shareholders:
Net income (loss) attributable to Holdings common shareholders (basic) $ 168
$ (290 )
Less: Incremental dilution from AB⁽¹⁾
—
1
Net income (loss) attributable to Holdings common shareholders (diluted) $ 168
$ (291 )


~~(1)~~	The incremental dilution from AB represents the impact of AB’s dilutive units on the Company’s diluted earnings per share and is calculated based on the Company’s proportionate ownership interest in AB.

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~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~The following table presents both basic and diluted income (loss) per share for each period presented:~~

Three Months Ended March 31,
2018 2017
(dollars per share)
Net income (loss) attributable to Holdings per common share:
Basic $ 0.30
$ (0.52 )
Diluted $ 0.30
$ (0.52 )

~~17) REVISION OF PRIOR PERIOD FINANCIAL STATEMENTS~~

During the first quarter of 2018, management identified an error in its previously issued financial statements related to a misclassification between interest credited and net derivative gains/losses. The impact of this error to the consolidated financial statements for the six months ended June 30, 2017, nine months ended September 30, ~~2017~~2023, 3.5 million and ~~the years ended December 31, 2017~~2.4 million respectively, and 2016 was not considered to be material. In order to improve the consistency and comparability of the financial statements, management revised the consolidated statements of income (loss) and statements of cash flows to include the revisions discussed herein.

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~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

The following tables present line items for prior period financial statements that have been affected by the revisions. For these items, the tables detail the amounts as previously reported, the impact upon those line items due to the revisions, and the amounts as currently revised within the financial statements.

~~Effects of the revision to the Company’s previously reported Consolidated Statements of Income (Loss) and Cash Flows~~ for the ~~six months ended June 30, 2017~~

Six Months Ended
June 30, 2017
As Previously Reported Impact of Revisions As Revised
(in millions)
Consolidated Statement of Income (Loss):
Revenues:
Net derivative gains (losses) $ 528
$ (34 ) $ 494
Total revenues 6,746
$ (34 ) 6,712
Benefits and other deductions:
Interest credited to policyholders’ account balances $ 522
$ (34 ) $ 488
Total benefits and other deductions 6,299
$ (34 ) 6,265

Six Months Ended
June 30, 2017
As Previously Reported Impact of Revisions As Revised
(in millions)
Consolidated Statement of Cash Flows:
Cash flow from operating activities:
Interest credited to policyholders’ account balances $ 522
$ (34 ) $ 488
Net derivative (gains) loss (528 ) 34
(494 )
Net cash provided by (used in) operating activities 666
$ —
666

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

~~Effects of the revision to the Company’s previously reported Consolidated Statements of Income (Loss)~~three and ~~Cash Flows for the~~ nine months ended September 30, ~~2017~~2022, 2.9 million and 3.5 million, respectively, of outstanding stock awards, were not included in the computation of diluted earnings per share because their effect was anti-dilutive.

Nine Months Ended
September 30, 2017
As Previously Reported Impact of Revisions As Revised
(in millions)
Consolidated Statement of Income (Loss):
Revenues:
Net derivative gains (losses) $ 172
$ (44 ) $ 128
Total revenues 9,529
$ (44 ) 9,485
Benefits and other deductions:
Interest credited to Policyholders’ account balances $ 787
$ (44 ) $ 743
Total benefits and other deductions 9,070
$ (44 ) 9,026

Nine Months Ended
September 30, 2017
As Previously Reported Impact of Revisions As Revised
(in millions)
Consolidated Statement of Cash Flows:
Cash flow from operating activities:
Interest credited to policyholders’ account balances $ 787
$ (44 ) $ 743
Net derivative (gains) loss (172 ) 44
(128 )
Net cash provided by (used in) operating activities 1,044
$ —
1,044

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~~AXA~~ EQUITABLE HOLDINGS, INC.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~Notes to Consolidated Financial Statements (Unaudited), Continued

~~(UNAUDITED)~~

20) HELD-FOR-SALE

~~Effects~~Assets and liabilities related to the business classified as HFS are separately reported in the consolidated balance sheets beginning in the period in which the business is classified as HFS.

AB Bernstein Research Services

On November 22, 2022, AB and Société Générale, a leading European bank, announced plans to form a joint venture combining their respective cash equities and research businesses. Upon closing, AB will own a 49% interest in the joint venture and Société Générale will own a 51% interest in the joint venture, with an option to reach 100% ownership after five years. The consummation of the ~~revision~~joint venture is subject to customary closing conditions, including regulatory clearances. Due to the ~~Company’s previously reported~~expected timing of regulatory approvals, the closing is expected to occur in the first half of 2024.

The assets and liabilities of AB's research services business recorded at fair value, less cost to sell have been classified as held-for-sale in our Consolidated ~~Statements~~Financial Statements. As a result of ~~Income (Loss),~~classifying these assets as held-for-sale, AB recognized a non-cash valuation adjustment of $2 million, $8 million and ~~Cash Flows~~$7 million on the consolidated statement of income, to recognize the net carrying value at lower of cost or fair value, less costs to sell for the ~~year ended December 31, 2017~~

December 31, 2017
As Previously Reported Impact of Revisions As Revised
(in millions)
Consolidated Statement of Income (Loss):
Revenues:
Net derivative gains (losses) $ 228
$ (113 ) $ 115
Total revenues 12,514
$ (113 ) 12,401
Benefits and other deductions:
Interest credited to Policyholder’s account balances 1,108
$ (113 ) 995
Total benefits and other deductions 11,200
$ (113 ) 11,087

December 31, 2017
As Previously Reported Impact of Revisions As Revised
(in millions)
Consolidated Statement of Cash Flows:
Cash flow from operating activities:
Interest credited to policyholders’ account balances $ 1,108
$ (113 ) $ 995
Net derivative (gains) loss (228 ) 113
(115 )
Net cash provided by (used in) operating activities 1,021
$ —
1,021

~~Effects of the revision to the Company’s previously reported Consolidated Statements of Income (Loss),~~three and ~~Cash Flows for the year ended December 31, 2016~~

December 31, 2016
As Previously Reported Impact of Revisions As Revised
(in millions)
Consolidated Statement of Income (Loss):
Revenues:
Net derivative gains (losses) $ (1,722 ) $ (121 ) —
$ (1,843 )
Total revenues 11,922
$ (121 ) 11,801
Benefits and other deductions:
Interest credited to Policyholder’s account balances 1,091
$ (121 ) 970
Total benefits and other deductions 9,868
$ (121 ) 9,747

~~Table of Contents~~

~~AXA EQUITABLE HOLDINGS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(UNAUDITED)~~

December 31, 2016
As Previously Reported Impact of Revisions As Revised
(in millions)
Consolidated Statement of Cash Flows:
Cash flow from operating activities:
Interest credited to policyholders’ account balances $ 1,091
$ (121 ) $ 970
Net derivative (gains) loss 1,722
121
1,843
Net cash provided by (used in) operating activities (236 ) $ —
(236 )

~~18) SUBSEQUENT EVENTS~~

In April 2018, Holdings entered into letter agreements with the lenders under each of its credit facilities and letter of credit facilities, and AXA Equitable Life entered into waiver letter agreements with certain of its derivative counterparties, waiving defaults caused by the restatement of certain financial statements. Holdings and AXA Equitable Life each restated their annual financial statements for the year ended December 31, 2016 and Holdings restated its interim financial statements for the nine months ended September 30, ~~2017~~2023 and as of December 31, 2022, respectively. Approximately $5 million in costs to sell have been paid as of September 30, 2023.

The following table summarizes the assets and liabilities classified as held-for-sale on the ~~six months ended June~~Company’s consolidated balance sheets:


	September 30, 2023 (1)		December 31, 2022 (1)
	(in millions)
Cash and cash equivalents	$	146	$	159
Broker-dealer related receivables	175		74
Trading securities, at fair value	24		25
Goodwill and other intangible assets ,net	164		175
Other assets (2)	172		129
Total assets held-for-sale	$	681	$	562


Broker-dealer related payables	$	71	$	33
Customers related payables	29		10
Other liabilities	116		65
Total liabilities held-for-sale	$	216	$	108

____________

(1) The assets and liabilities classified as held-for-sale are reported within our Investment Management & Research segment.

(2) Other assets includes a valuation adjustment of $(10) million and $(7) million, as of September 30, ~~2017. All required waivers were received~~2023 and ~~we do~~December 31, 2022, respectively.

These assets and liabilities are reported under the Investment Management & Research segment. The Company has determined that AB’s exit from the research business did not ~~consider this to have~~represent a ~~material impact~~strategic shift that had a major effect on ~~our business,~~AB’s or the Company’s consolidated results of operations, orand therefore, are not classified as discontinued operations.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

21 REINSURANCE

The Company assumes and cedes reinsurance with other insurance companies. The Company evaluates the financial ~~condition.~~condition of its reinsurers to minimize its exposure to significant losses from reinsurer insolvencies. Ceded reinsurance does not relieve the originating insurer of liability.

The following table summarizes the effect of reinsurance. The impact of the transactions described above results in a decrease to reinsurance assumed and an increase in reinsurance ceded.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Direct charges and fee income	$	780	$	761	$	2,312	$	2,344
Reinsurance assumed	—		—		3		(1)
Reinsurance ceded	(181)		(158)		(534)		(470)
Policy charges and fee income	$	599	$	603	$	1,781	$	1,873

Direct premiums	$	287	$	262	$	868	$	778
Reinsurance assumed	40		51		135		138
Reinsurance ceded	(60)		(54)		(180)		(172)
Premiums	$	267	$	259	$	823	$	744

Direct policyholders’ benefits	$	807	$	765	$	2,534	$	2,369
Reinsurance assumed	29		44		105		150
Reinsurance ceded	(143)		(180)		(532)		(499)
Policyholders’ benefits	$	693	$	629	$	2,107	$	2,020

Direct interest credited to policyholders’ account balances	$	573	$	389	$	1,582	$	1,035

Reinsurance ceded	(17)		(11)		(62)		(34)
Interest credited to policyholders’ account balances	$	556	$	378	$	1,520	$	1,001

Ceded Reinsurance

The Company reinsures most of its new variable life, UL and term life policies on an excess of retention basis. The Company generally retains on a per life basis up to $25 million for single lives and $30 million for joint lives with the excess 100% reinsured. The Company also reinsures risk on certain substandard underwriting risks and in certain other cases.

On October 3, 2022, Equitable Financial ceded to First Allmerica Financial Life Insurance Company, a wholly owned subsidiary of Global Atlantic Financial Group, on a combined coinsurance and modified coinsurance basis, a 50% quota share of approximately 360,000 legacy Group EQUI-VEST deferred variable annuity contracts issued by Equitable Financial between 1980 and 2008.

In ~~April 2018, Colisee Re S.A.’s promise~~addition to the ~~Delaware Department of Insurance to maintain~~above, the ~~minimum RBC level for AXA Corporate Solutions Life Reinsurance~~ Company ~~at the company action level was terminated and replaced with a similar guarantee from Holdings.~~

As a result of the completion of the GMxB Unwind on April 12, 2018, we were released from regulatory letter of credit requirements, and accordingly no longer benefit from the $1.5 billion revolving credit facility with AXA.

~~On April 20, 2018, Holdings:~~

issued $800 million aggregate principal amount of 3.900% Senior Notes due 2023, $1.5 billion aggregate principal amount of 4.350% Senior Notes due 2028 and $1.5 billion aggregate principal amount of 5.000% Senior Notes due 2048 (together, the “Notes”);

~~delivered a termination notice, effective April 23, 2018, for its $3.9 billion two-year senior unsecured delayed draw term loan agreement; and~~

~~settled certain loans issued to or received from AXA and its affiliates resulting in a net payment to AXA and its affiliates of $2,530 million in principal and $11 million of accrued interest.~~

~~On April 20, 2018, AXA pre-paid the remaining $650 million of a $700 million note and $50 million of a $500 million term loan and related accrued interest from the Company.~~

~~On April 23, 2018, Holdings used~~cedes a portion of ~~the net proceeds from~~its group health, extended term insurance, and paid-up life insurance and substantially all of its individual disability income business through various coinsurance agreements.

Assumed Reinsurance

In addition to the sale of insurance products, the Company currently assumes risk from professional reinsurers. The Company also had a run-off portfolio of assumed reinsurance liabilities at CSLRC which was sold to Venerable in June 2021. The Company assumes accident, life, health, annuity (including products covering GMDB and GMIB benefits), aviation, special risk and space risks by participating in or reinsuring various reinsurance pools and arrangements.

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EQUITABLE HOLDINGS, INC.

Notes ~~together~~to Consolidated Financial Statements (Unaudited), Continued

The following table summarizes the ceded reinsurance GMIB reinsurance contracts, third-party recoverables, amount due to reinsurance and assumed reserves:



	September 30, 2023		December 31, 2022
	(in millions)
Ceded Reinsurance:
Estimated net fair values of purchased market risk benefits	$	8,745	$	10,423
Third-party reinsurance recoverables related to insurance contracts	8,271		8,471
Top reinsurers:
First Allmerica-GAF	3,735		4,005
Zurich Life Insurance Company, Ltd.	1,357		1,416
RGA Reinsurance Company	1,263		1,272

Ceded group health reserves	54		47
Amount due to reinsurers	1,424		1,533
Top reinsurers:
RGA Reinsurance Company	1,155		1,171
First Allmerica-GAF	71		147
Protective Life Insurance Company	97		104
Assumed Reinsurance:
Reinsurance assumed reserves	$	689	$	701

22) SUBSEQUENT EVENTS

In September 2023, Holdings established an obligation to enter into an ASR with ~~available cash,~~a third-party financial institution to ~~(i) purchase 100%~~repurchase an aggregate of ~~the shares of AXA IM Holdings US and (ii) purchase the AB Units held by Coliseum Re. The Company’s $185~~$80 million loan to AXA IM Holding US was settled as part of the purchase of AXA IM Holding US, which wholly owns AB units. The remaining net proceeds, together with the $300 million of borrowings drawn on May 4th, 2018 under our three-year term loan agreement, was used to fully repay the outstanding commercial paper program of AXA Financial currently guaranteed by AXA. By the time of the IPO, all the credit facilities Holdings and its subsidiaries previously had with AXA or guaranteed by AXA were terminated.

On April 24, 2018, a 459.4752645-for-1 stock split of the common stock of Holdings was effected. All applicable share data, per share amounts and related information in the consolidated financial statements and notes thereto have been adjusted retroactively to give effect to the stock split.

On April 25, 2018, Holdings adopted the AXA Equitable Holdings, Inc. Short-Term Incentive Compensation Plan (the “STIC Plan”). Although the STIC Plan is not a share-based compensation plan, awards payable under the STIC Plan may be paid in cash or in awards granted under the AXA Equitable Holdings, Inc. 2018 Omnibus Incentive Plan (the “Omnibus Plan”), a share-based compensation plan. The Omnibus Plan was adopted by Holdings on May 8, 2018.

On May 2, 2018, AB announced that it will establish its corporate headquarters in, and relocate approximately 1,050 jobs currently located in the New York metro area to, Nashville, TN. AB’s Nashville headquarters will house Finance, IT, Operations, Legal, Compliance, Internal Audit, Human Capital, and Sales and Marketing. AB will begin relocating jobs during 2018 and expects this transition to take several years. AB will continue to maintain a principal location in New York City, which will house its Portfolio Management, Sell-Side Research and Trading, and New York-based Private Wealth Management businesses.

On May 4, 2018, Holdings borrowed $300 million under the $500 million three-year senior unsecured delayed draw term loan agreement. On May 9, 2018, Holdings amended and restated its Certificate of Incorporation under which the Board of Directors have the authority, without further action by stockholders, to issue up to 200,000,000 shares of preferred stock, par value $1.00 per share, in one or more series.

~~On May 14, 2018, Holdings completed an initial public offering in which AXA sold 157,837,500 shares~~ of Holdings’ common ~~stock~~stock. Pursuant to the ~~public. Following the~~ASR, on October 4, 2023, Holdings made a pre-payment of $80 million and received initial ~~public offering, AXA owned 423,750,000~~delivery of 2.3 million shares. The ASR terminated in October 2023, at which time an additional 596,000 shares of ~~Holdings’~~ common ~~stock.~~

~~As of June 12th, there are no longer any amounts outstanding under AXA Financial’s commercial paper program and AXA will no longer provide any related guarantees.~~

stock were received.

Table of Contents

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

AXA Equitable Holdings, Inc. (“Holdings” and, collectively with its consolidated subsidiaries, the “Company”) is a diversified financial services company. Through March 31, 2018, Holdings was a wholly-owned subsidiary of AXA S.A. (“AXA”), a French holding company for the AXA Group, a worldwide leader in life, property and casualty and health insurance and asset management. As used herein, “AXA Equitable Life” refers to AXA Equitable Life Insurance Company, a New York stock life insurance corporation, “AXA Financial” refers to AXA Financial, Inc., an intermediate holding company incorporated in Delaware, “MLOA” refers to MONY Life Insurance Company of America, an Arizona life insurance corporation, “AXA Advisors” refers to AXA Advisors, LLC, a Delaware limited liability company, and “AXA RE Arizona” refers to AXA RE Arizona Company, an Arizona corporation, and “EQ AZ Life Re” refers to EQ AZ Life Re Company, a newly formed captive insurance company organized under the laws of Arizona.

In May 2017, AXA announced its intention to pursue the sale of a minority stake in Holdings through an initial public offering (the “IPO”). On May 14, 2018, Holdings completed the IPO in which AXA sold 157,837,500 shares of Holdings common stock to the public. Following the IPO, AXA owns approximately 71.9% of the outstanding common stock of Holdings.

~~Management’s~~The following discussion and analysis of our financial condition and results of operations ~~for the Company that follows~~ should be read in its entirety and in conjunction with the consolidated financial statements and ~~the~~ related ~~Notes to Consolidated Financial Statements included elsewhere herein, with the information provided under “Forward-looking Statements” included elsewhere herein and the~~notes contained in Part I, Item 1 of this Quarterly Report on Form 10-Q, as well as “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section contained in the Recast 2022 Annual Report.

In addition to historical data, this discussion contains forward-looking statements about our business, operations and ~~“Risk Factors” sections included~~financial performance based on current expectations that involve risks, uncertainties and assumptions. Actual results may differ materially from those discussed in ~~Holdings’ prospectus dated May 9, 2018,~~the forward-looking statements as a result of various factors. See the Note Regarding Forward-Looking Statements and Information. Investors are directed to consider the risks and uncertainties discussed in Part II, Item 1A of this Quarterly Report on Form 10-Q, as well as in other documents we have filed with the ~~U.S. Securities and Exchange Commission pursuant to Rule 424(b)(4) under the Securities Act of 1933, as amended, on May 11, 2018 (the “Prospectus”).~~SEC.

Executive Summary

Overview

We are one of America’s leading financial services companies, ~~providing~~providing: (i) advice and solutions for helping Americans set and meet their retirement goals and protect and transfer their wealth across ~~generations~~generations; and (ii) a wide range of investment management insights, expertise and innovations to drive better investment decisions and outcomes for clients worldwide.

We manage our business through ~~four~~six segments: Individual Retirement, Group Retirement, Investment Management and Research, Protection Solutions, Wealth Management and ~~Protection Solutions.~~Legacy. We report certain activities and items that are not included in these segments in Corporate and Other. See Note 1517 of the Notes to the Consolidated Financial Statements for further information on ~~the Company’s~~our segments.

We benefit from our complementary mix of businesses. This business mix provides diversity in our earnings sources, which helps offset fluctuations in market conditions and variability in business results, while offering growth opportunities.

~~Revenues~~Long - Duration Targeted Improvements (“LDTI”) Adoption

~~Our revenues come from~~Effective January 1, 2023, the Company adopted ASU 2018-12 and elected a transition date of January 1, 2021, thereby permitting the Company to implement the standard only for the last two fiscal years rather than the customary last three ~~principal sources:~~fiscal years.

~~fee income derived from our retirement~~The Company adopted ASU 2018-12 for liability for future policy benefits, additional insurance liabilities, DAC and ~~protection products and our investment management and research services;~~

~~premiums from our traditional life insurance and annuity products; and~~

~~investment income from our General Account investment assets (“GAIA”).~~

~~Our fee income varies directly in relation~~balances amortized on a basis consistent with DAC on a modified retrospective basis. ASU 2018-12 was adopted for MRBs on a full retrospective basis. See Note 2of the Notes to the ~~amount~~Consolidated Financial Statements for further information on the adoption of the underlying account value or benefit base of our retirement and protection products and the amount of AUM of our Investment Management and Research business. AV and AUM, each as defined in “—Key Operating Measures,” are influenced by changes in economic conditions, primarily equity market returns, as well as net flows. Our premium income is driven by the growth in new policies written and the persistency of our in-force policies, both of which are influenced by a combination of factors, including our efforts to attract and retain customers and market conditions that influence demand for our products. Our investment income is driven by the yield on our portfolio of

LDTI.

Table of Contents

The following table presents the balances and changes to the balances for the market risk benefits for the GMxB benefits on deferred variable annuities:

~~GAIA~~


	Three Months Ended September 30, 2023
	Individual Retirement		Legacy
	GMxB Core		GMxB Legacy		Purchased MRB		Net Legacy
	(in millions)
Balance, beginning of period	$	131	$	12,720	$	(9,923)	$	2,797
Balance BOP before changes in the instrument specific credit risk	351		14,142		(9,827)		4,315
Model changes and effect of changes in cash flow assumptions	20		(11)		(33)		(44)
Actual market movement effect (1)	202		718		(300)		418
Interest accrual	22		213		(150)		63
Attributed fees accrued (2)	100		212		(66)		146
Benefit payments	(11)		(322)		190		(132)
Actual policyholder behavior different from expected behavior (3)	7		(13)		(2)		(15)
Changes in future economic assumptions (4)	(411)		(2,609)		1,511		(1,098)
Issuances	—		—		—		—
Balance EOP before changes in the instrument-specific credit risk	280		12,330		(8,677)		3,653
Changes in the instrument-specific credit risk	38		(349)		(61)		(410)
Balance, end of period	$	318	$	11,981	$	(8,738)	$	3,243

____________

(1) The effect of actual market movement in equity is materially offset by hedging gains/losses, which are not shown in the table above.

(2) Attributed fees accrued represents the portion of the fees set aside to fund future GMxB claims. For our Core business, the $100 million attributed fees set aside is less than the explicit GMxB Rider fees we actually collect from policyholders. For our Core business, the net riders fees (rider fees charged minus attributed fees) reported in our policy charges and fee income is ~~impacted by~~$20 million. This means that the ~~prevailing level of interest rates as~~GMxB rider fees we ~~reinvest cash~~charge more than cover the future claims and hedging costs associated with ~~maturing investments and net flows~~the GMxB riders. For our Legacy business, the attributed fees of $212 million set aside to fund future GMxB claims is more than the rider fees actually collected from policyholders. This is because the product was not sufficiently priced for the claims we now expect. This required us to attribute a portion of the base contract fees, in addition to the ~~portfolio.~~rider fees, to reserve for the rider claims. Net rider fees (rider fees charged minus attributed fees), net of reinsurance, for Legacy business reported in the policy charges and fee income are a loss of $70 million, and are more than covered by base contract fees.

~~Benefits and Other Deductions~~

~~Our primary expenses are:~~

~~policyholders’ benefits and interest credited to policyholders’ account balances;~~

~~sales commissions and compensation paid to intermediaries and advisors that distribute~~(3) Actual policyholder behavior different from expected behavior measures the effectiveness of our ~~products and services; and~~

~~compensation and benefits provided to~~modeling of policyholder behavior. Put differently, it measures the difference between our ~~employees and other operating expenses.~~

~~Policyholders’ benefits are driven primarily by mortality, customer withdrawals, and benefits which~~expectations about how our MRB rider reserves would change in response to ~~changes~~policyholder behavior, and how our MRB rider reserves actually changed in ~~capital market conditions. In addition, some~~response to policyholder behavior. For our Core business, the MRB rider reserve was $7 million higher than we expected after accounting for actual policyholder behavior. The unfavorable impact of this actual policyholder behavior was more than covered by the excess rider fees noted above. For our ~~policyholders’ benefits~~Legacy business, the impact on our GAAP earnings from policyholder behavior, net of reinsurance, was a net gain of $15 million.

(4) Changes in future economic assumptions represents the impact from interest rates on the MRB balance. These fluctuations are ~~directly tied to the AV and benefit base of~~offset through our ~~variable annuity products. Interest credited to policyholders varies~~interest rate hedging program which is reflected partially in relation to the amount of the underlying AV or benefit base. Sales commissions and compensation paid to intermediaries and advisors vary in relation to premium and fee income generated from these sources, whereas compensation and benefits to our employees are more constant and decline with increases in efficiency. Our ability to manage these expenses across various economic cycles and products is critical to the profitability of our company.

GAAP Net Income ~~Volatility~~

We have offered and continue to offer variable annuity products with variable annuity guaranteed benefits (“GMxB”) features. The future claims exposure on these features is sensitive to movements in the equity markets and interest rates. Accordingly, we have implemented hedging and reinsurance programs designed to mitigate the economic exposure to us from these features due to equity market and interest rate movements. Changes in the values of the derivatives associated with these programs due to equity market and interest rate movements are recognized in the periods in which they occur while corresponding changes in offsetting liabilities are recognized over time. This results in net income volatility as further described below. See “—Significant Factors Impacting Our Results—Impact of Hedging and GMIB Reinsurance on Results.”

In addition to our dynamic hedging strategy, we have recently implemented static hedge positions designed to mitigate the adverse impact of changing market conditions on our statutory capital. We believe this program will continue to preserve the economic value of our variable annuity contracts and better protect our target variable annuity asset level. However, these new static hedge positions increase the size of our derivative positions and may result in higher net income volatility on a period-over-period basis.

Due to the impacts on our net income of equity market and interest rate movements and other items that are not part of the underlying profitability drivers of our business, we evaluate and manage our business performance using Non-GAAP Operating Earnings, a non-GAAP financial measure that is intended to remove these impacts from our results. See “—Key Operating Measures—Non-GAAP Operating Earnings.”

~~Significant Factors Impacting Our Results~~

~~The following significant factors have impacted, and may in the future impact, our financial condition, results of operations or cash flows.~~

~~Impact of Hedging and GMIB Reinsurance on Results~~

We have offered and continue to offer variable annuity products with GMxB features. The future claims exposure on these features is sensitive to movements in the equity markets and interest rates. Accordingly, we have implemented hedging and reinsurance programs designed to mitigate the economic exposure to us from these features due to equity market and interest rate movements. These programs include:

~~Table of Contents~~

~~Variable annuity hedging programs.~~ ~~We use a dynamic hedging program (within this program, we reevaluate our economic exposure at least daily and rebalance our hedge positions accordingly) to mitigate certain risks associated~~ with the ~~GMxB features that are embedded~~remainder reflected in our liabilities for our variable annuity products. This program utilizes various derivative instruments that are managed in an effort to reduce the economic impact of unfavorable changes in GMxB features’ exposures attributable to movements in the equity markets and interest rates. Although this program is designed to provide a measure of economic protection against the impact of adverse market conditions, it does not qualify for hedge accounting treatment. Accordingly, changes in value of the derivatives will be recognized in the period in which they occur with offsetting changes in reserves partially recognized in the current period, resulting in net income volatility. In addition to our dynamic hedging program, in the fourth quarter of 2017 and the first quarter of 2018, we implemented a new hedging program using static hedge positions (derivative positions intended to be held to maturity with less frequent rebalancing) to protect our statutory capital against stress scenarios. The implementation of this new program in addition to our dynamic hedge program is expected to increase the size of our derivative positions, resulting in an increase in net income volatility. The impacts are most pronounced for variable annuity products in our Individual Retirement segment.

OCI.

~~GMIB reinsurance contracts.~~ Historically, GMIB reinsurance contracts were used to cede to affiliated and non-affiliated reinsurers a portion of our exposure to variable annuity products that offer a GMIB feature. We account for the GMIB reinsurance contracts as derivatives and report them at fair value. Gross reserves for GMIB reserves are calculated on the basis of assumptions related to projected benefits and related contract charges over the lives of the contracts. Accordingly, our gross reserves will not immediately reflect the offsetting impact on future claims exposure resulting from the same capital market or interest rate fluctuations that cause gains or losses on the fair value of the GMIB reinsurance contracts. Because changes in the fair value of the GMIB reinsurance contracts are recorded in the period in which they occur and a majority of the changes in gross reserves for GMIB are recognized over time, net income will be more volatile.

~~Effect of Assumption Updates on Operating Results~~

Most of the variable annuity products, variable universal life insurance and universal life insurance products we offer maintain policyholder deposits that are reported as liabilities and classified within either Separate Account liabilities or policyholder account balances. Our products and riders also impact liabilities for future policyholder benefits and unearned revenues and assets for DAC and deferred sales inducements. The valuation of these assets and liabilities (other than deposits) are based on differing accounting methods depending on the product, each of which requires numerous assumptions and considerable judgment. The accounting guidance applied in the valuation of these assets and liabilities includes, but is not limited to, the following: (i) traditional life insurance products for which assumptions are locked in at inception; (ii) universal life insurance and variable life insurance secondary guarantees for which benefit liabilities are determined by estimating the expected value of death benefits payable when the account balance is projected to be zero and recognizing those benefits ratably over the accumulation period based on total expected assessments; (iii) certain product guarantees for which benefit liabilities are accrued over the life of the contract in proportion to actual and future expected policy assessments; and (iv) certain product guarantees reported as embedded derivatives at fair value.

Our actuaries oversee the valuation of these product liabilities and assets and review underlying inputs and assumptions. We review the actuarial assumptions underlying these valuations at least annually and update assumptions when appropriate. Assumptions are based on a combination of company experience, industry experience, management actions and expert judgment and reflect our best estimate as of the date of each financial statement. Changes in assumptions can result in a significant change to the carrying value of product liabilities and assets and, consequently, the impact could be material to earnings in the period of the change. For further details of our accounting policies and related judgments pertaining to assumption updates, see Note 2 of Notes to Consolidated Financial Statements.

Macroeconomic and Industry Trends

Our business and consolidated results of operations are significantly affected by economic conditions and consumer confidence, conditions in the global capital markets and the interest rate environment.

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Financial and Economic ~~Conditions and Consumer Confidence~~Environment

A wide variety of factors continue to impact financial and economic ~~conditions and consumer confidence.~~conditions. These factors include, among others, concerns over increased volatility in the capital markets, equity market declines, rising interest rates, inflationary pressures, plateauing or decreasing economic growth, high fuel and energy costs, changes in ~~the United States, continued low interest rates, falling unemployment rates,~~fiscal or monetary policy and geopolitical tensions. Amidst ongoing concerns about inflation and the U.S. Federal Reserve’s ~~plans to further raise short-term~~tightening monetary policies, the S&P 500, the Dow Jones Industrial Average, and Nasdaq experienced losses during the third quarter, driven primarily by continued interest rate increases by the Federal Reserve. Thirty year mortgage rates hit their highest level since 2000 and the 10-year Treasury yield rose its highest level since 2007. The U.S. economy has weathered higher interest rates ~~fluctuations~~well, emboldening the

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Federal Reserve to tighten monetary policies. While inflation is trending lower, core inflation remains over 4%, well above the Federal Reserve’s 2% target.

Geopolitical tensions are also contributing to market volatility due to the ongoing military conflict between the Ukraine and Russia and Hamas’s attack on Israel and the ensuing conflict and the sanctions and other measures imposed in response to these conflicts.

Stressed conditions, volatility and disruptions in the ~~strength of the U.S. dollar, the uncertainty created by what actions the current administration may pursue, changes~~capital markets, particular markets, or financial asset classes can have an adverse effect on us, in ~~tax policy, global economic~~part because we have a large investment portfolio. In addition, our insurance liabilities and derivatives are sensitive to changing market factors, including ~~programs by~~equity market performance and interest rates, which continued to rise during the European Central Bank and the United Kingdom’s vote to exit from the European Union and other geopolitical issues. Additionally, many of the products and solutions we sell are tax-advantaged or tax-deferred. If U.S. tax laws were to change, such that our products and solutions are no longer tax-advantaged or tax-deferred, demand for our products could materially decrease.

~~Capital Market Conditions~~

Although extraordinary monetary accommodation has mitigated volatility in interest rate and credit and domestic equity markets for an extended period, global central banks may now be past peak accommodation as the U.S. Federal Reserve continues its gradual pace of policy normalization. As global monetary policy becomes less accommodating, anthird quarter 2023. An increase in market volatility could continue to affect our business, including through effects on the yields we earn on invested assets, changes in required reserves and capital and fluctuations in the value of our AUM, AV or ~~AUA.~~AUA from which we derive our fee income. These effects could be exacerbated by uncertainty about future fiscal policy, changes in tax policy, the scope of potential deregulation and levels of global trade.

~~In the short- to medium-term, the~~The potential for increased volatility ~~coupled with prevailing interest rates remaining below historical averages,~~ could pressure sales and reduce demand for our products as consumers consider purchasing alternative products to meet their objectives. In addition, this environment could make it difficult to consistently develop products that are attractive to customers. Financial performance can be adversely affected by market volatility and equity market declines as fees driven by AV and AUM fluctuate, hedging costs increase and revenues decline due to reduced sales and increased outflows.

We monitor the behavior of our customers and other factors, including mortality rates, morbidity rates, annuitization rates and lapse and surrender rates, which change in response to changes in capital market conditions, to ensure that our products and solutions remain attractive and profitable.

~~Interest Rate Environment~~

~~We believe the~~ For additional information on our sensitivity to interest ~~rate environment will continue to impact our business~~rates and ~~financial performance~~capital market prices, see “Quantitative and Qualitative Disclosures About Market Risk” in the ~~future for several reasons, including the following:~~

Our GAIA portfolio consists predominantly of fixed income investments. In the near term, and absent further material change in yields available on investments, we expect the yield we earn on new investments will be lower than the yields we earn on maturing investments, which were generally purchased in environments where interest rates were higher than current levels. If interest rates were to rise, we expect the yield on our new money investments would also rise and gradually converge toward the yield of those maturing assets.

Certain of our variable annuity and life insurance products pay guaranteed minimum interest crediting rates. We are required to pay these guaranteed minimum rates even if earnings on our investment portfolio decline, with the resulting investment margin compression negatively impacting earnings. In addition, we expect more policyholders to hold policies with comparatively high guaranteed rates longer (lower lapse rates) in a low interest rate environment. Conversely, a rise in average yield on our investment portfolio should positively impact earnings. Similarly, we expect policyholders would be less likely to hold policies with existing guaranteed rates (higher lapse rates) as interest rates rise.

A prolonged low interest rate environment also may subject us to increased hedging costs or an increase in the amount of statutory reserves that our insurance subsidiaries are required to hold for GMxB features, lowering their statutory surplus, which would adversely affect their ability to pay dividends to us. In addition, it may also increase the perceived value of GMxB features to our policyholders, which in turn may lead to a higher rate of annuitization and higher persistency of those products over time. Finally, low interest rates may continue to cause an acceleration of DAC amortization or reserve increase due to loss recognition for interest sensitive products, primarily for our Protection Solutions segment.

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Recast 2022 Annual Report.

Regulatory Developments

Our life insurance subsidiaries are regulated primarily at the state level, with some policies and products also subject to federal regulation. OnIn addition, Holdings and its insurance subsidiaries are subject to regulation under the insurance holding company laws of various U.S. jurisdictions. Furthermore, on an ongoing basis, regulators refine capital requirements and introduce new reserving standards. Regulations recently adopted or currently under review can potentially impact our statutory reserve, capital requirements and profitability of the industry and result in increased regulation and oversight for the industry.

On August 13, 2023, the NAIC adopted a short-term solution related to the accounting treatment of an insurer’s negative interest maintenance reserve (“IMR”) balance, which may occur when a rising interest rate environment causes an insurer’s IMR balance to become negative as a result of bond sales executed at a capital ~~requirements.~~

~~National Association~~loss. If this occurs, previous statutory accounting guidance required the non-admittance of ~~Insurance Commissioners (“NAIC”).~~negative IMR, which can impact how accurately an insurer’s surplus and financial strength are reflected in its financial statements and result in lower reported surplus and RBC ratios. The NAIC’s new interim statutory accounting guidance, which is effective until December 31, 2025, allows an insurer with an authorized control level RBC greater than 300% to admit negative IMR up to 10% of its general account capital and surplus, subject to certain restrictions and reporting obligations. The NAIC intends to develop a long-term solution for the accounting treatment of negative IMR, which may nullify the application of the proposed short-term solution if implemented prior to December 31, 2025.

The NAIC has been focused on a macro-prudential initiative since 2017, that is ~~currently considering~~intended to enhance risk identification efforts through proposed enhancements to supervisory practices related to liquidity, recovery and resolution, capital stress testing and counterparty exposure concentrations for life insurers. In 2020, the NAIC adopted amendments to the Model Holding Company Act and Regulation that implement an annual filing requirement related to a ~~proposal,~~liquidity stress-testing framework (the “Liquidity Stress Test”) for certain large U.S. life insurers and insurance groups (based on amounts of certain types of business written or material exposure to certain investment transactions, such as derivatives and securities lending). The Liquidity Stress Test is used as a regulatory tool in jurisdictions which ifhave adopted ~~could materially~~the holding company amendments.

The NAIC developed a group capital calculation tool (“GCC”) using an RBC aggregation methodology for all entities within the insurance holding company system, including non-U.S. entities. The GCC provides U.S. solvency regulators with an additional analytical tool for use in solvency monitoring activities. The NAIC’s amendments to the Model Holding Company Act and Regulation in 2020 also adopted the GCC Template and Instructions and implemented the annual filing requirement

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with an insurance group’s lead state regulator. The GCC filing requirement becomes effective when the holding company amendments have been adopted by the state where an insurance group’s lead state regulator is located.

In August of 2023, the state of New York adopted legislation codifying the Liquidity Stress Test and the GCC. The first GCC filing will be required on June 30, 2024.

The NAIC’s Privacy Protections (H) Working Group (“PPWG”) is developing a new Consumer Privacy Protections and Model Law (“Model 674”) to replace the existing privacy models, #670 (Insurance Information and Privacy Protections Model Act) and #672 (Privacy of Consumer Financial and Health Information Regulation). Following meetings in the spring of 2023, the PPWG rewrote Model 674 to incorporate industry feedback and exposed a new draft in July 2023. Due to the large number of comments received, the PPWG intends to ask for an extension of time to develop the new model law at the NAIC’s Fall National Meeting in December 2023. We cannot predict whether Model 674 will be adopted, what form it will take, or what effect it would have on our business or compliance efforts in the form adopted by states whose laws apply to our insurance subsidiaries.

For additional information on regulatory developments and the risks we face, see “Business—Regulation” in the Recast 2022 Annual Report and our Quarterly Reports on Form 10-Q for the months ended March 31, 2023 and June 30, 2023 and “Risk Factors—Legal and Regulatory Risks” in the 2022 Form 10-K.

Revenues

Our revenues come from three principal sources:

•fee income derived from our retirement and protection products and our investment management and research services;

•premiums from our traditional life insurance and annuity products; and

•investment income from our General Account investment portfolio.

Our fee income varies directly in relation to the amount of the underlying AV or benefit base of our retirement and protection products, the amount of AUM and AUA in our Wealth Management business, and the amount of AUM of our Investment Management and Research business. AV and AUM, each as defined in “Key Operating Measures,” are influenced by changes in economic conditions, primarily equity market returns, as well as net flows. Our premium income is driven by the growth in new policies written and the persistency of our in-force policies, both of which are influenced by a combination of factors, including our efforts to attract and retain customers and market conditions that influence demand for our products. Our investment income is driven by the yield on our General Account investment portfolio and is impacted by the prevailing level of interest rates as we reinvest cash associated with maturing investments and net flows to the portfolio.

Benefits and Other Deductions

Our primary expenses are:

• policyholders’ benefits and interest credited to policyholders’ account balances;

• sales commissions and compensation paid to intermediaries and advisors that distribute our products and services; and

• compensation and benefits provided to our employees and other operating expenses.

Policyholders’ benefits are driven primarily by mortality, customer withdrawals, and benefits which change in response to changes in capital market conditions. In addition, some of our policyholders’ benefits are directly tied to the ~~sensitivity~~AV and benefit base of our variable annuity ~~reserves~~products. Interest credited to policyholders varies in relation to the amount of the underlying AV or benefit base. Sales commissions and ~~capital requirements~~compensation paid to ~~capital markets including interest rate,~~intermediaries and advisors vary in relation to premium and fee income generated from these sources, whereas compensation and benefits to our employees are more constant and impacted by market wages and decline with increases in efficiency. Our ability to manage these expenses across various economic cycles and products is critical to the profitability of our company.

Net Income Volatility

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reinsurance programs designed to mitigate the economic exposure to us from these features due to equity market and interest rate movements. Changes in the values of the derivatives associated with these programs due to equity market and interest rate movements, together with the GMxB MRBs assets and liabilities are recognized in the periods in which they occur. This results in net income volatility as ~~well as prescribed assumptions for policyholder behavior.~~further described below. In addition, net income is impacted by changes in our reinsurers credit spread, while changes in the ~~NAIC Financial Condition (E) Committee has established a working group~~Company's credit spread is recorded in other comprehensive income. See “—Significant Factors Impacting Our Results—Impact of Hedging and GMxB Reinsurance on Results.”

In addition to ~~study and address, as appropriate, regulatory issues resulting from~~our dynamic hedging strategy, we have static hedge positions designed to mitigate the adverse impact of changing market conditions on our statutory capital. We believe this program will continue to preserve the economic value of our variable annuity ~~captive~~contracts and better protect our target variable annuity asset level. However, these static hedge positions increase the size of our derivative positions and may result in net income volatility on a period-over-period basis.

Significant Factors Impacting Our Results

The following significant factors have impacted, and may in the future impact, our financial condition, results of operations or cash flows.

Impact of Hedging and GMxB Reinsurance on Results

We have offered and continue to offer variable annuity products with GMxB features. The future claims exposure on these features is sensitive to movements in the equity markets and interest rates. Accordingly, we have implemented hedging and reinsurance ~~transactions, including reforms~~programs designed to mitigate the economic exposure to us from these features due to equity market and interest rate movements. These programs include:

•Variable annuity hedging programs. We use a dynamic hedging program (within this program, generally, we reevaluate our economic exposure at least daily and rebalance our hedge positions accordingly) to mitigate certain risks associated with the GMxB features that ~~would improve the current reserve and capital framework~~are embedded in our liabilities for ~~insurance companies that sell~~our variable annuity products.

This program utilizes various derivative instruments that are managed in an effort to reduce the economic impact of unfavorable changes in GMxB features’ exposures attributable to movements in the equity markets and interest rates. Although this program is designed to provide a measure of economic protection against the impact of adverse market conditions, it does not qualify for hedge accounting treatment. Accordingly, changes in value of the derivatives will be recognized in the period in which they occur with offsetting changes in reserves recognized in the current period. In addition, we utilize AFS fixed maturity securities in our General Account to mitigate the economic impact unfavorable changes in GMxB features’ exposures attributable to movements in interest rates. However, the economic effect of interest rate changes on such securities is reflected in OCI, which results in net income volatility as the economic effect of interest rates on our GMxB MRB liabilities is reflected in net income.

~~Department of Labor (“DOL”).~~•In ~~April 2016, the DOL issued~~addition to our dynamic hedging program, we have a ~~final rule (the “Rule”), which significantly expanded the range of activities considered~~hedging program using static hedge positions (derivative positions intended to be ~~fiduciary investment advice under~~held-to-maturity with less frequent re-balancing) to protect our statutory capital against stress scenarios. This program, in addition to our dynamic hedge program, has increased the ~~Employee Retirement Income Security Act~~size of ~~1974 (“ERISA”) when~~ our ~~advisors~~derivative positions, resulting in additional net income volatility. The impacts are most pronounced for variable annuity products.

•GMxB reinsurance contracts. Historically, GMxB reinsurance contracts were used to cede to non-affiliated reinsurers a portion of our exposure to variable annuity products that offer a GMxB feature. We account for the reinsurance contracts as MRBs and report them at fair value. In addition, on June 1, 2021, we ceded legacy variable annuity policies sold by Equitable Financial between 2006-2008 (the “Block”), comprised of non-New York “Accumulator” policies containing fixed rate GMIB and/or GMDB guarantees.

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Effect of Assumption Updates on Operating Results

During the third quarter of each year, we conduct our employees provide investment-related information and support to retirement plan sponsors, participants and individual retirement account (“IRA”) holders. In February 2017, the DOL was directed by memorandum (the “President’s Memorandum”) toannual review ~~the Rule and determine whether the Rule should be rescinded or revised, in light~~ of the ~~new administration’s policies~~assumptions underlying the valuation of DAC, deferred sales inducement assets, unearned revenue liabilities, liabilities for future policyholder benefits and ~~orientations. The Rule was partially implemented~~market risk benefits for our Individual Retirement, Group Retirement, Protection Solutions, and Legacy segments (assumption reviews are not relevant for the Investment Management and Research and Wealth Management segments). Assumptions are based on ~~June 9, 2017, with~~ a ~~special transition period for certain requirements that took effect on January 1, 2018. On November 29, 2017, the DOL finalized a delay in implementing certain portions~~combination of ~~the Rule from January 1, 2018 to July 1, 2019. On March 15, 2018, a federal appeals court issued a decision vacating the Rule~~Company experience, industry experience, management actions and ~~subsequently denied motions by the Attorneys General of three states to intervene in the case. A final mandate has not been issued~~expert judgment and reflect our best estimate as of the date of ~~this report,~~the applicable financial statements.

Most of the variable annuity products, variable universal life insurance and ~~there~~universal life insurance products we offer maintain policyholder deposits that are reported as liabilities and classified within either Separate Accounts liabilities or policyholder account balances. Our products and riders also impact liabilities for future policyholder benefits, market risk benefits and unearned revenues and assets for DAC and DSI. The valuation of these assets and liabilities (other than deposits) is ~~a possibility that~~based on differing accounting methods depending on the ~~DOL may appeal this decision~~product, each of which requires numerous assumptions and considerable judgment. The accounting guidance applied in the valuation of these assets and liabilities includes, but is not limited to, the ~~U.S. Supreme Court. At this time, we do not currently plan any immediate changes~~following: (i) traditional life insurance products for which assumptions are updated annually to estimate the value of future death, morbidity or income benefits; (ii) universal life insurance and variable life insurance secondary guarantees for which benefit liabilities are determined by estimating the expected value of death benefits payable when the account balance is projected to be zero and recognizing those benefits ratably over the accumulation period based on total expected assessments; and (iii) certain product guarantees reported as market risk benefits at fair value.

For further details of our ~~approach~~accounting policies and related judgments pertaining to ~~selling products and providing services to ERISA plans and IRAs. If~~assumption updates, see Note 2 of the ~~Rule remains in effect, we may need to make adverse changes~~Notes to the ~~level~~Consolidated Financial Statements and ~~type~~“—Summary of ~~services~~Critical Accounting Estimates—Liability for Future Policy Benefits” included in the Recast 2022 Annual Report.

Assumption Updates and Model Changes

We conduct our annual review of our assumptions and models during the third quarter of each year. We also update our assumptions as needed in the event we ~~provide as well as the nature and amount~~become aware of ~~compensation and fees~~economic conditions or events that could require a change in our assumptions that we believe may have a significant impact to the carrying value of product liabilities and assets and consequently materially impact our ~~affiliated advisors and firms receive for investment-related services to retirement plans and IRAs.~~

earnings in the period of the change.

Impact of Assumption Updates and Model Changes on Income from Continuing Operations before income taxes and Net income (loss)

The table below presents the ~~Tax Reform Act~~impact of our actuarial assumption update during the nine months ended September 30, 2023 and 2022 to our income (loss) from continuing operations, before income taxes and net income (loss).

~~On December 22, 2017, President Trump signed into law the Tax Reform Act, a broad overhaul~~


	Nine Months Ended September 30
		2023		2022
		(in millions)
Impact of assumption update on Net income (loss):
Variable annuity product features related assumption update		$	44	$	(205)
Assumption updates for other business		(49)		(1)
Impact of assumption updates on Income (loss) from continuing operations, before income tax		(5)		(206)
Income tax benefit on assumption update		1		43
Net income (loss) impact of assumption update		$	(4)	$	(163)

2023 Assumption Updates

The impact of the ~~U.S. Internal Revenue Code that changes long-standing provisions governing the taxation of U.S. corporations, including life insurance companies.~~

The Tax Reform Act reduces the federal corporate income tax rate to 21% beginning in 2018 and repeals the corporate alternative minimum tax (“AMT”) while keeping existing AMT credits. It also contains measures affecting our insurance companies, including changes to the dividends received deduction (“DRD”), insurance reserves and tax DAC, and measures affecting our international operations, such as a one-time transitional tax on some of the accumulated earnings of our foreign subsidiaries (within our Investment Management and Research Segment).

~~As a result of the Tax Reform Act, we expect our Non-GAAP Operating Earnings to improve on a recurring basis due to the reduction~~economic assumption update in the ~~effective tax rate. Our new effective tax rate is expected~~third quarter 2023 was a decrease of $5 million to ~~be approximately 19%, driven mainly by the new federal corporate tax rate of 21%~~income (loss) from continuing operations, before income taxes and ~~the DRD benefit.~~

~~We expect the Tax Reform Act to have both positive and negative impacts on our balance sheet. On the one hand, as~~ a one-time effect, the lower tax rate resulted in a reduction to the value of our deferred tax assets. On the other hand, the Tax Reform Act repeals the corporate AMT and, subject to certain limitations, allows us to use our AMT credits going forward, which we expect will result in a reduction of our tax liability.

In 2017, on a statutory basis, we recorded a moderate increase to our Combined risk-based capital (“RBC”) ratio as a result of the Tax Reform Act. Specifically, this was driven mainly by the benefit of the corporate AMT repeal, but partially offset by a lower statutory deferred tax asset valuation.

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~~We expect the tax liability on the earnings of our foreign subsidiaries will decrease going forward. In 2017, we recorded a one-time~~ decrease to net income (loss) of ~~$23~~$4 million.

The net impact of this assumption update on income (loss) from continuing operations, before income taxes of $5 million ~~due to the estimated transitional tax on some~~consisted of a decrease in other income of $9 million, an increase in remeasurement of liability for future policy benefits of $51 million, a decrease in policyholders’ benefits of $2 million and an decrease in change in market risk benefits and purchased market risk benefits of $53 million.

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2022 Assumption Updates

The impact of the ~~accumulated earnings~~economic assumption update in the third quarter 2022 was a decrease of ~~these subsidiaries.~~$206 million to income (loss) from continuing operations, before income taxes and a decrease to net income (loss) of $163 million.

~~Overall, we expect the Tax Reform Act to have~~The net impact of this assumption update on income (loss) from continuing operations, before income taxes of $206 million consisted of a ~~net positive economic impact on us. We continue to evaluate this new~~increase in remeasurement of liability for future policy benefits of $14 million, a decrease in policyholders’ benefits of $13 million, an increase in change in market risk benefits and ~~complicated piece~~purchased market risk benefits of ~~legislation, assess the magnitude of the various impacts and monitor potential regulatory changes related to this reform.~~

~~Separation Costs~~

In connection with the IPO and operating as a stand-alone public company, we have incurred and expect to continue to incur one-time and recurring expenses. These expenses primarily relate to information technology, compliance, internal audit, finance, risk management, procurement, client service, human resources and other support services. The process of replicating and replacing functions, systems and infrastructure provided by AXA or certain of its affiliates in order to operate on a stand-alone basis is currently underway and we expect that it will continue following the IPO.

~~We estimate that the aggregate amount of the one-time expenses described above will be between approximately $300~~$204 million and ~~$350 million,~~an increase in interest credited to policyholder’s account balances of ~~which $93 million was incurred in 2017 and approximately $150 million is expected to be incurred in 2018. Of this amount, $61.4 million and $0 million~~$1 million.

Model Changes

There were ~~incurred~~no material model changes in the first ~~quarter~~nine months of ~~2018~~2023 and ~~2017, respectively. Furthermore, additional one-time expenses will be incurred when AXA ceases to own at least a majority~~2022.

Impact of Assumption Updates and Model Changes on Pre-tax Non-GAAP Operating Earnings Adjustments

The table below presents the impact on pre-tax Non-GAAP operating earnings of our ~~outstanding common stock. See “Risk Factors”~~actuarial assumption updates during the nine months ended September 30, 2023 and 2022 by segment and Corporate and Other.


	Nine Months Ended September 30
	2023		2022

Impact of assumption updates by segment:
Individual Retirement	$	1	$	(1)
Group Retirement	—		—
Protection Solutions	11		(4)
Legacy	3		—
Impact of assumption updates on Corporate and Other	—		3
Total impact on pre-tax Non-GAAP Operating Earnings	$	15	$	(2)

2023 Assumption Updates

The impact of our 2023 annual review on Non-GAAP operating earnings was favorable by $15 million before taking into consideration the tax impacts, or $12 million after tax.

The net impact of assumption changes on Non-GAAP operating earnings increased other income by $4 million, decreased remeasurement of liability for future policy benefits by $10 million, and decreased policyholders’ benefits by $1 million. Non-GAAP operating earnings excludes items related to variable annuity product features, such as changes in the ~~Prospectus~~market risk benefits and purchased market risk benefits.

2022 Assumption Updates

The impact of our 2022 annual review on Non-GAAP operating earnings was unfavorable by $2 million before taking into consideration the tax impacts or $1 million after tax.

The net impact of assumption changes on Non-GAAP operating earnings increased remeasurement of liability for ~~additional information.~~future policy benefits by $14 million, decreased policyholders’ benefits by $13 million and increased interest credited by to policyholder’s account balances by $1 million. Non-GAAP operating earnings excludes items related to variable annuity product features, such as changes in the market risk benefits and purchased market risk benefits.

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Key Operating Measures

In addition to our results presented in accordance with U.S. GAAP, we report Non-GAAP ~~Operating Earnings,~~operating earnings, Non-GAAP ~~Operating ROC by segment for our Individual Retirement, Group Retirement and Protection Solutions segments,~~operating ROE, and Non-GAAP ~~Operating Earnings per share,~~operating common EPS, each of which is a measure that is not determined in accordance with U.S. GAAP. Management principally uses these non-GAAP financial measures in evaluating performance because they present a clearer picture of our operating performance and they allow management to allocate resources. Similarly, management believes that the use of these ~~non-GAAP~~Non-GAAP financial measures, together with relevant U.S. GAAP measures, ~~provides~~provide investors with a better understanding of our results of operations and the underlying profitability drivers and trends of our business. These non-GAAP financial measures are intended to remove from our results of operations the impact of market changes (where there is a mismatch in the valuation of assets and liabilities) as well as certain other expenses which are not part of our underlying profitability drivers or likely to re-occur in the foreseeable future, as such items fluctuate from period-to-period in a manner inconsistent with these drivers. These measures should be considered supplementary to our results that are presented in accordance with U.S. GAAP and should not be viewed as a substitute for the U.S. GAAP measures. Other companies may use similarly titled non-GAAP financial measures that are calculated differently from the way we calculate such measures. Consequently, our non-GAAP financial measures may not be comparable to similar measures used by other companies.

We also discuss certain operating measures, including AUM, AUA, AV, Protection Solutions ~~Reserves~~reserves and certain other operating measures, which management believes provide useful information about our businesses and the operational factors underlying our financial performance.

Non-GAAP Operating Earnings

Non-GAAP Operating Earnings is an after-tax ~~Non-GAAP~~non-GAAP financial measure used to evaluate our financial performance on a consolidated basis that is determined by making certain adjustments to our consolidated after-tax net income attributable to Holdings. The most significant of such adjustments relates to our derivative positions, which protect economic value and statutory capital, and ~~are more sensitive to changes in market conditions than~~ the variable annuity product ~~liabilities as valued under U.S. GAAP.~~MRBs. This is a large source of volatility in net income.

In the first quarter of 2018, the Company revised its Non-GAAP Operating Earnings definition as it relates to the treatment of certain elements of the profitability of its variable annuity products with indexed-linked features to align to the treatment of its variable annuity products with GMxB features. In addition, adjustments for variable annuity products with index-linked features previously included within Other adjustments in the calculation of Non-GAAP Operating Earnings are now included with the

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adjustments for variable annuity products with GMxB features in the broader adjustment category, Variable annuity product features. The presentations of Non-GAAP Operating Earnings in prior periods were revised to reflect this change in definition.

Non-GAAP Operating Earnings equals our consolidated after-tax net income attributable to Holdings adjusted to eliminate the impact of the following items:

•Items related to ~~Variable~~variable annuity product features, which ~~include certain~~include: (i) changes in the fair value of market risk benefits and purchased market risk benefits, including the related attributed fees and claims, offset by derivatives and other securities ~~we use~~used to hedge ~~these features and changes~~the market risk benefits which result in residual net income volatility as the change in fair value of certain securities is reflected in OCI and due to our statutory capital hedge program; and (ii) market adjustments to deposit asset or liability accounts arising from reinsurance agreements which do not expose the ~~embedded derivatives reflected within Variable annuity products’ net derivative results;~~

reinsurer to a reasonable possibility of a significant loss from insurance risk;

~~Goodwill impairment, which includes a write-down of goodwill in first quarter of 2017.~~

•Net actuarial (gains) losses, which includes actuarial gains and losses as a result of differences between actual and expected experience on pension plan assets or projected benefit obligation during a given period related to pension, other postretirement benefit obligations, and the one-time impact of the settlement of the defined benefit obligation;

•Income tax expense (benefit) related to the above items and non-recurring tax items, which includes the effect of uncertain tax positions for a given audit period ~~permanent differences due~~and a decrease of deferred tax valuation allowance.

In the third quarter 2023, the Company updated its operating earnings measure to ~~goodwill impairment,~~exclude the impact of the annual actuarial assumption update attributable to LFPB as the majority of the earnings volatility attributable to these assumption updates relate to the Company’s Legacy and non-business segment products and as such do not represent the ~~Tax Reform Act.~~Company’s ongoing revenue generating activities or future business strategy, and impedes comparability of operating results period over period. Non-GAAP Operating Earnings were favorably impacted by this change in the amount of $61 million for the three and nine months ended

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September 30, 2023, respectively. The presentation of operating earnings in prior periods was not revised to reflect this modification because the impact to those periods was immaterial.

Because Non-GAAP Operating Earnings excludes the foregoing items that can be distortive or unpredictable, management believes that this measure enhances the understanding of the Company’s underlying drivers of profitability and trends in our business, thereby allowing management to make decisions that will positively impact our business.

We use ~~our~~the prevailing corporate federal income tax rate of 21% ~~in 2018 and 35% in 2017,~~ while taking into account any non-recurring differences for events recognized differently in our financial statements and federal income tax returns as well as partnership income taxed at lower rates when reconciling Net income (loss) attributable to Holdings to Non-GAAP Operating Earnings.

~~Table of Contents~~

The table below presents a reconciliation of ~~Net~~net income (loss) attributable to Holdings to Non-GAAP Operating ~~Earnings~~Earnings:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Net income (loss) attributable to Holdings	$	1,064	$	594	$	2,000	$	2,091
Adjustments related to:
Variable annuity product features (3)	(1,380)		(675)		(584)		(2,322)
Investment (gains) losses	411		333		554		890
Net actuarial (gains) losses related to pension and other postretirement benefit obligations	8		19		26		57
Other adjustments (1)	91		50		198		455
Income tax expense (benefit) related to above adjustments	183		58		(40)		194
Non-recurring tax items (2)	36		7		(936)		13
Non-GAAP Operating Earnings	$	413	$	386	$	1,218	$	1,378

______________

(1)Includes certain legal accruals related to the COI litigation of $— million and $35 million for the three and nine months ended ~~March 31, 2018~~September 30, 2023, respectively and ~~2017:~~

Three Months Ended
March 31,
2018 2017
(in millions)
Net income (loss) attributable to Holdings $ 168
$ (290 )
Adjustments related to:
Variable annuity product features ⁽¹⁾
212
291
Investment (gains) losses (102 ) 24
Goodwill impairment —
369
Net actuarial (gains) losses related to pension and other postretirement benefit obligations 131
34
Other adjustments 90
(21 )
Income tax expense (benefit) related to above adjustments (63 ) (235 )
Non-recurring tax items 28
132
Non-GAAP Operating Earnings $ 464
$ 304

~~(1) This reconciling item was previously referred~~$2 million and $168 million for the three and nine months ended September 30, 2022, respectively. Includes policyholder benefit costs of $75 million for the nine months ended September 30, 2022 stemming from a deal to ~~as “GMxB product features”, but is now referred to more broadly as “Variable annuity product features.” See Note 15 to~~repurchase UL policies from one entity that had invested in numerous policies purchased in the ~~Notes to Consolidated Financial Statements for details~~life settlement market. Includes the impact of ~~adjustments~~unfavorable annual actuarial assumptions updates related to ~~Variable annuity product features.~~LFPB of $61 million for the three and nine months ended September 30, 2023. Prior period impact was immaterial and was not revised.

(2)For the three and nine months ended September 30, 2023, non-recurring tax items reflect primarily the effect of uncertain tax positions for a given audit period and an increase of the deferred tax valuation allowance of $20 million and a decrease of $970 million, respectively.

(3)Includes the impact of favorable assumption updates of $40 million for the three and nine months ended September 30, 2023. Includes the impact of unfavorable assumption updates of $204 million for the three and nine months ended September 30, 2022.

Non-GAAP Operating ~~ROC by Segment~~ROE

We report Non-GAAP Operating ROC by segment for our Individual Retirement, Group Retirement and Protection Solutions segments, which is a non-GAAP financial measure used to evaluate our recurrent profitability on a consolidated basis and by segment, respectively. We calculate Non-GAAP Operating ~~ROC by segment~~ROE by dividing ~~operating earnings (loss) on a segment basis~~Non-GAAP Operating Earnings for the previous twelve calendar months by consolidated average ~~capital on a segment basis,~~equity attributable to Holdings’ common shareholders, excluding ~~AOCI and NCI, as described below.~~AOCI. AOCI fluctuates period-to-period in a manner inconsistent with our underlying profitability drivers as the majority of such fluctuation is related to the market volatility of the unrealized gains and losses associated with our ~~available for sale (“AFS”)~~AFS securities. Therefore, we believe excluding AOCI is more effective infor analyzing the trends of our operations. We do not calculate Non-GAAP Operating ROC by segment for our Investment Management & Research segment because we do not manage that segment from a return of capital perspective. Instead, we use metrics more directly applicable to an asset management business, such as AUM, to evaluate and manage that segment. For Non-GAAP Operating ROC by segment, capital components pertaining directly to specific segments such as DAC along with targeted capital are directly attributed to these segments. Targeted capital for each segment is established using assumptions supporting statutory capital adequacy levels necessary to be considered a going concern. To enhance the ability to analyze these measures across periods, interim periods are annualized. Non-GAAP Operating ROC by segment should not be used as a substitute for ROE.

~~Table of Contents~~

The following table ~~sets forth~~presents return on average equity attributable to Holdings’ common shareholders, excluding AOCI and Non-GAAP Operating ~~ROC by segment for our Individual Retirement, Group Retirement and Protection Solutions segments~~ROE for the trailing twelve ~~months ended March 31, 2018.~~months:

Trailing Twelve Months Ended March 31, 2018
Individual Retirement Group Retirement Protection Solutions
(in millions)
Operating earnings $ 1,483
$ 298
$ 521
Average capital⁽¹⁾
6,925
1,262
2,674
Non-GAAP Operating ROC 21.4 % 23.6 % 19.5 %


~~(1)~~	~~For~~Trailing Twelve Months Ended September 30, 2023
	(Dollars in millions)
Net income (loss) available to Holdings’ common shareholders	$	1,982
Average equity attributable to Holdings’ common shareholders, excluding AOCI	$	9,139
Return on average ~~capital amounts by segment, capital components pertaining directly~~equity attributable to specific segments such as DAC along with targeted capital are directly attributed to these segments. Targeted capital for each segment is established using assumptions supporting statutory capital adequacy levels necessary to be considered a going concern.Holdings’ common shareholders, excluding AOCI	21.7		%

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	Trailing Twelve Months Ended September 30, 2023
	(Dollars in millions)
Non-GAAP Operating Earnings available to Holdings’ common shareholders	$	1,486
Average equity attributable to Holdings’ common shareholders, excluding AOCI	$	9,139
Non-GAAP Operating ROE	16.3		%

Non-GAAP Operating ~~Earnings per Share~~Common EPS

Non-GAAP ~~Operating~~operating common EPS is calculated by dividing Non-GAAP Operating Earnings by ~~ending~~diluted common shares ~~outstanding - diluted.~~outstanding. The following table sets forth Non-GAAP ~~Operating EPS~~operating common EPS:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(per share amounts)
Net income (loss) attributable to Holdings (1)	$	3.06	$	1.58	$	5.62	$	5.45
Less: Preferred stock dividends	0.04		0.04		0.15		0.14
Net income (loss) available to Holdings’ common shareholders	3.02		1.54		5.47		5.31
Adjustments related to:
Variable annuity product features	(3.97)		(1.79)		(1.64)		(6.06)
Investment (gains) losses	1.18		0.88		1.56		2.32
Net actuarial (gains) losses related to pension and other postretirement benefit obligations	0.02		0.05		0.07		0.15
Other adjustments (2) (4)	0.27		0.14		0.55		1.20
Income tax expense (benefit) related to above adjustments	0.53		0.15		(0.11)		0.51
Non-recurring tax items (3)	0.10		0.02		(2.63)		0.03
Non-GAAP operating common EPS	$	1.15	$	0.99	$	3.27	$	3.46

______________

(1)For periods presented with a net loss, basic shares are used for EPS.

(2)Includes certain gross legal expenses related to the COI litigation and claims related to a commercial relationship of $0.00 and $0.10 for the three and nine months ended ~~March 31, 2018~~September 30, 2023, respectively and ~~2017.~~$0.01 and $0.44 for the three and nine months ended September 30, 2022, respectively. Includes policyholder benefit costs of $0.20 for the nine months ended September 30, 2022 stemming from a deal to repurchase UL policies from one entity that had invested in numerous policies purchased in the life settlement market. Includes the impact of unfavorable annual actuarial assumptions updates related to LFPB of $0.18 and $0.17 for the three and nine months ended September 30, 2023. Prior period impact was immaterial and was not revised.

(3)For the three and nine months ended September 30, 2023 and 2022, non-recurring tax items reflects the effect of uncertain tax positions for a given audit period and an increase of a deferred tax valuation allowance of $0.06 and a decrease of $2.73.

Three Months Ended March 31,
2018 2017
(per share amounts)
Net income (loss) attributable to Holdings $ 0.30
$ (0.52 )
Adjustments related to:
Variable annuity product features 0.38
0.52
Investment (gains) losses (0.18 ) 0.04
Goodwill impairment —
0.66
Net actuarial (gains) losses related to pension and other postretirement benefit obligations 0.23
0.06
Other adjustments 0.16
(0.04 )
Income tax expense (benefit) related to above adjustments (0.11 ) (0.42 )
Non-recurring tax items 0.05
0.24
Non-GAAP Operating Earnings $ 0.83
$ 0.54
(4)Includes the impact of favorable assumption updates of $0.11 and $0.67 for the three and nine months ended September 30, 2023. Includes the impact of unfavorable assumption updates of $0.54 and $0.53 million for the three and nine months ended September 30, 2022.

Assets Under Management ~~(“AUM”)~~

AUM means investment assets that are managed by one of our subsidiaries and includes: (i) assets managed by ~~AB,~~AB; (ii) the assets in our ~~GAIA portfolio~~General Account investment portfolio; and (iii) the Separate ~~Account~~Accounts assets of our Individual Retirement, Group Retirement and Protection Solutions businesses. Total AUM reflects exclusions between segments to avoid double counting.

Assets Under Administration ~~(“AUA”)~~

AUA includes non-insurance client assets that are invested in our savings and investment products or serviced by our ~~AXA~~Equitable Advisors platform. We provide administrative services for these assets and generally record the revenues received as distribution fees.

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Account Value ~~(“AV”)~~

AV generally equals the aggregate policy account value of our retirement products. General Account AV refers to account balances in investment options that are backed by the General Account while Separate ~~Account~~Accounts AV refers to Separate ~~Account~~Accounts investment assets.

Protection Solutions Reserves

Protection Solutions Reserves equals the aggregate value of ~~Policyholders’~~policyholders’ account balances and ~~Future~~future policy benefits for policies in our Protection Solutions segment.

Consolidated Results of Operations

Our consolidated results of operations are significantly affected by conditions in the capital markets and the economy because we offer ~~variable annuity products with GMxB features.~~market sensitive products. These products have been a significant driver of our results of operations. Because the future claims exposure on these products is sensitive to movements in the equity markets and interest rates, we have in place various hedging and reinsurance programs that are designed to mitigate the economic ~~risks~~risk of movements in the equity markets and interest rates. The volatility in ~~Net~~net income attributable to Holdings for the periods presented below results from the mismatch ~~between~~between: (i) the change in carrying value of the reserves for GMDB and certain GMIB features that do not fully and

immediately reflect the impact of equity and interest market ~~fluctuations and~~fluctuations; (ii) the change in fair value of products with the GMIB feature that ~~has~~have a no-lapse ~~guarantee,~~guarantee; and (iii) our hedging and reinsurance programs.

AsOwnership and Consolidation of March 31, 2018 and March 31, 2017, our economic interest in AB was approximately 46.5% and 45.8%, respectively. On April 23, 2018, Holdings purchased (i) 8,160,000 AB Units from Coliseum Reinsurance Company and (ii) all of the issued and outstanding shares of common stock of AXA-IM Holding U.S., Inc., which owns directly 41,934,582 AB Units. As a result of these transactions (collectively, the “AB Reorganization Transactions”), at April 30, 2018, the Company’s economic interest in AB was approximately 65%.AllianceBernstein

Our indirect, ~~wholly owned~~wholly-owned subsidiary, AllianceBernstein Corporation, is the General Partner of AB. Accordingly, ~~AB is consolidated in our financial statements, and its~~AB’s results are fully reflected in our consolidated financial statements. For additional information on our economic interest in AB, see Note 1 of the Notes to the Consolidated Financial Statements.

~~Table~~Consolidated Results of ~~Contents~~

Operations

The following table summarizes our consolidated statements of income (loss):

Consolidated Statements of Income (Loss)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions, except per share data)
REVENUES
Policy charges and fee income	$	599	$	603	$	1,781	$	1,873
Premiums	267		259		823		744
Net derivative gains (losses)	615		199		(1,143)		2,216
Net investment income (loss)	1,071		842		3,097		2,357
Investment gains (losses), net:
Credit losses on available-for-sale debt securities and loans	(65)		(267)		(145)		(266)
Other investment gains (losses), net	(346)		(65)		(409)		(624)
Total investment gains (losses), net	(411)		(332)		(554)		(890)
Investment management and service fees	1,217		1,179		3,579		3,731
Other income	266		242		775		797
Total revenues	3,624		2,992		8,358		10,828

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	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions, except per share data)
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	693		629		2,107		2,020
Remeasurement of liability for future policy benefits	49		20		46		54
Change in market risk benefits and purchased market risk benefits	(817)		(491)		(1,772)		(144)
Interest credited to policyholders’ account balances	556		378		1,520		1,001
Compensation and benefits	593		568		1,742		1,682
Commissions and distribution-related payments	405		368		1,178		1,184
Interest expense	55		51		171		148
Amortization of deferred policy acquisition costs	165		148		472		436
Other operating costs and expenses	450		496		1,339		1,613
Total benefits and other deductions	2,149		2,167		6,803		7,994
Income (loss) from continuing operations, before income taxes	1,475		825		1,555		2,834
Income tax (expense) benefit	(340)		(177)		677		(578)
Net income (loss)	1,135		648		2,232		2,256
Less: Net income (loss) attributable to the noncontrolling interest	71		54		232		165
Net income (loss) attributable to Holdings	1,064		594		2,000		2,091
Less: Preferred stock dividends	14		14		54		54
Net income (loss) available to Holdings’ common shareholders	$	1,050	$	580	$	1,946	$	2,037

EARNINGS PER COMMON SHARE
Net income (loss) applicable to Holdings’ common shareholders per common share:
Basic	$	3.03	$	1.55	$	5.49	$	5.35
Diluted	$	3.02	$	1.54	$	5.47	$	5.32
Weighted average common shares outstanding (in millions):
Basic	346.4		374.5		354.4		380.6
Diluted	348.0		376.8		355.9		382.9


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Non-GAAP Operating Earnings	$	413	$	386	$	1,218	$	1,378

The following table summarizes our Non-GAAP Operating Earnings per common share:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022

Non-GAAP operating earnings per common share:
Basic	$	1.15	$	0.99	$	3.28	$	3.48
Diluted	$	1.15	$	0.99	$	3.27	$	3.46

Three Months Ended September 30, 2023 Compared to the Three Months Ended September 30, 2022

Net Income (Loss) Attributable to Holdings

Net income attributable to Holdings increased $470 million to $1.1 billion for the three months ended ~~March 31, 2018 and 2017:~~

Three Months Ended March 31,
2018 2017
(in millions, except earnings per share amounts)
REVENUES
Policy charges and fee income $ 972
$ 956
Premiums 279
281
Net derivative gains (losses) (281 ) (235 )
Net investment income (loss) 591
780
Investment gains (losses), net:
Total other-than-temporary impairment losses —
(1 )
Other investment gains (losses), net 102
(23 )
Total investment gains (losses), net 102
(24 )
Investment management and service fees 1,055
954
Other income 117
118
Total revenues 2,835
2,830
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits 608
1,093
Interest credited to policyholders’ account balances 271
246
Compensation and benefits (includes $40 and $41 of deferred acquisition costs) 620
539
Commissions and distribution related payments (includes $120 and $132 of deferred acquisition costs) 411
395
Interest expense 46
35
Amortization of deferred policy acquisition costs, net (net of capitalization of $160 and $173) 15
(55 )
Other operating costs and expenses 494
744
Total benefits and other deductions 2,465
2,997
Income (loss) from continuing operations, before income taxes 370
(167 )
Income tax (expense) benefit (79 ) (30 )
Net income (loss) 291
(197 )
Less: net (income) loss attributable to the noncontrolling interest (123 ) (93 )
Net income (loss) attributable to Holdings $ 168
$ (290 )
EARNINGS PER SHARE
Earnings per share - Common stock
Basic $ 0.30
$ (0.52 )
Diluted $ 0.30
$ (0.52 )
Weighted average common shares outstanding 561
561

~~Table of Contents~~

Three Months Ended March 31,
2018 2017
(in millions, except earnings per share amounts)
Non-GAAP Operating Earnings $ 464
$ 304
Non-GAAP Operating Earnings per share, Basic $ 0.83
$ 0.54
Non-GAAP Operating Earnings per share, Diluted $ 0.83
$ 0.54

~~The following discussion compares the results for~~September 30, 2023 from $594 million in the three months ended ~~March 31, 2018~~September 30, 2022. The following notable items were the primary drivers for the change in net income (loss):

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Favorable items included:

•Net derivative gains increased by $416 million mainly due to reduced rates derivatives positions during the third quarter 2023 compared to the ~~comparable 2017 period’s results.~~third quarter 2022, during which rates rose significantly.

~~First Quarter 2018 Compared to First Quarter 2017~~

~~Net Income Attributable to Holdings~~

~~The $458 million increase~~•Change in ~~Net income attributable to Holdings, to $168 million for the first quarter of 2018 from a Net loss of $290 million for the first quarter of 2017, was primarily driven by the following notable items:~~

~~Policyholders’~~market risk benefits and purchased market risk benefits decreased by ~~$485~~$326 million ~~primarily~~mainly due to ~~a $441 million decrease in our Individual Retirement segment's GMxB reserves not carried at fair value, reflecting positive movement in~~higher interest ~~rates in the first~~rate increases during third quarter ~~of 2018~~2023 compared to ~~the first~~third quarter ~~of 2017. The net improvement~~2022.

•Net investment income increased by $229 million mainly due to higher assets, higher investment yields and higher alternative investment income, partially offset by lower income from TIPS offset in ~~GMxB margins was primarily~~derivatives.

•Fee-type revenue increased by $66 million mainly due to higher investment advisory base fees driven by ~~lower hedging losses related to equity (in the first quarter of 2017 equity market strongly increased while it slightly decreased~~higher average AUM in the first quarter of 2018) and reserve strengthening in 2017. The $41 million decrease in Corporate and Other was mainly driven by favorable claims experience in our Closed Block and assumed reinsurance block.

~~Other investment gains increased by $125 million, primarily due to the sale of fixed maturity securities, mainly U.S. Treasury securities.~~

~~Investment management and service fees increased by $102 million mainly driven by~~ our Investment Management and Research segment ~~mainly due to~~and higher ~~base fees reflecting an increase~~Advisory fee type revenue in ~~average AUM of 13% and a 2% increase in the overall portfolio return rate.~~

~~Policy charges and fee income increased by $16 million due~~our Wealth Management segment attributed to higher average ~~account values~~assets balances combined with increased interest income from ~~net flows~~sweep accounts.

•Compensation, benefits, interest and ~~higher equity markets.~~

~~Other~~other operating ~~costs and~~ expenses decreased by ~~$250~~$17 million mainly due to a ~~$369 million non-recurring goodwill impairment charge~~decrease in ~~the first quarter of 2017 resulting from the Company’s adoption of new accounting guidance for goodwill on January 1, 2017, partly~~other operating expenses, partially offset ~~by higher IPO related separation costs.~~

~~Partially offsetting this increase were the following notable items:~~

~~Decrease in Net investment income of $189 million, mainly due to a change in market value of trading securities primarily driven~~ by an increase in compensation and benefits and interest ~~rates.~~

expense.

~~Amortization of deferred acquisition costs, net increased~~These were partially offset by ~~$70 million, mainly driven by our Protection Solutions and Individual Retirement segments, and Corporate and Other. DAC amortization in~~ the Protection Solutions segment increased by $38 million, due to a $40 million increase in amortization before capitalization as we have remained in a loss recognition position in the first quarter of 2018 (loss recognition position started in the fourth quarter of 2017), which results in higher amortization. DAC amortization in our Individual Retirement segment was $13 million higher mainly due to $15 million lower capitalization due to a shift in sales towards SCS.

following unfavorable items:

•Interest credited to policyholders’ account balances increased by ~~$25~~$178 million mainly ~~driven by~~due to higher interest rates on funding agreements in Corporate and Other and growth of SCS AVaccount values in our Individual Retirement segment, ~~and Corporate and Other.~~

partially offset by the impact of the Global Atlantic Transaction in our Group Retirement segment.

~~Table of Contents~~

~~Net derivative~~•Investment losses increased by ~~$46~~$79 million ~~driven by~~mainly due to higher losses on our rebalancing program to reduce duration during third quarter 2023 compared to third quarter 2022.

•Policyholders’ benefits increased by $64 million mainly due to higher net mortality in our ~~GMxB book carried at fair value~~Protection Solutions segment.

•Commissions and ~~a change~~distribution-related payments increased by $37 million mainly due to higher average Separate Accounts account values in ~~market value~~our Individual Retirement segment, higher Advisory fee type revenue in our Wealth Management segment and higher premiums from employee benefits in our Protection Solution segment.

•Remeasurement of ~~our freestanding derivatives.~~

liability for future policy benefits increased by $29 million mainly due to higher unfavorable assumption updates in third quarter 2023 versus third quarter 2022.

•Amortization of DAC increased by $17 million mainly due to growth in the Individual Retirement segment from sales momentum.

•Net income attributable to noncontrolling interest increased by $17 million mainly due to higher pre-tax earnings and an increase of noncontrolling interest and gains from AB’s consolidated VIEs.

•Income tax expense increased by $49 million driven by an increase in pre-tax earnings partially offset by a lower effective tax rate due to the Tax Reform Act as well as the permanent differences of a one-time goodwill impairment in the first quarter of 2017.

~~Compensation and benefits increased by $81~~$163 million mainly due to higher pre-tax income for the ~~settlement of the pension benefit obligation of $100 million.~~

third quarter 2023 compared to third quarter 2022.

Non-GAAP Operating Earnings

Non-GAAP Operating Earnings increased by ~~$160~~$27 million to ~~$464~~$413 million ~~during~~for the ~~first quarter of 2018~~three months ended September 30, 2023 from ~~$304~~$386 million in the ~~first quarter of 2017, primarily driven by the~~three months ended September 30, 2022. The following notable ~~items:~~items were the primary drivers for the change in Non-GAAP Operating Earnings:

Favorable items included:

~~Policyholders’ benefits decreased~~•Net investment income increased by ~~$500~~$194 million ~~primarily due to a $456 million decrease in our Individual Retirement segment and a $41 million decrease in Corporate and Other. The improvement in Individual Retirement was~~ mainly ~~driven by a $462 million decrease in GMxB reserves~~ due to higher ~~interest rates in the first quarter of 2018,~~assets, higher investment yields and higher alternative investment income, partially offset by ~~$384~~lower income from TIPS offset in derivatives.

•Fee-type revenue increased by $84 million mainly due to higher ~~GMxB derivatives losses included in Investment gains (losses). The net improvement in GMxB margins was primarily~~investment advisory base fees driven by ~~reserve strengthening~~higher average AUM in ~~2017. The $41 million improvement in Corporate and Other was mainly from favorable claims experience in our Closed Block and assumed reinsurance block.~~

~~Investment management and service fees increased by $179 million mainly driven by~~ our Investment Management and Research segment ~~mainly due to~~and higher ~~base fees reflecting an increase~~Advisory fee type revenue in ~~average AUM of 13% and a 2% increase in the overall portfolio return rate.~~

~~Policy charges, fee income and premiums increased by $13 million, due~~our Wealth Management segment attributed to higher average AVassets balances combined with increased interest income from ~~net flows and higher equity markets.~~sweep accounts.

~~Net investment income increased~~

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•Remeasurement of liability for future policy benefits decreased by ~~$13~~$35 million mainly due to ~~the GA portfolio rebalancing.~~favorable assumption updates and model changes in third quarter 2023 compared to third quarter 2022 in our Protection Solutions segment.

~~Partially offsetting this increase were the following notable items:~~

~~Interest expense~~•Net derivative gains increased ~~by $14 million, primarily driven by higher cost of borrowings through securities repurchase agreements and higher interest rates in floating rate internal debt.~~

~~Amortization of DAC, net increased by $52~~$35 million mainly due to ~~our Protection Solutions and Individual Retirement segments. DAC amortization~~lower losses from TIPS hedging, offset in net investment income.

These were partially offset by the Protection Solutions segment increased by $42 million, due to a $44 million increase in amortization before capitalization, as we have remained in a loss recognition position in the first quarter of 2018 (loss recognition position started in the fourth quarter of 2017), which results in higher amortization. DAC amortization in our Individual Retirement segment was $7 million higher mainly due to $15 million lower capitalization due to a shift in sales towards SCS.

following unfavorable items:

Higher Compensation, benefits, and other operating cost of $77 million, mainly due to an increase of $67 million in the Investment Management & Research segment, including $43 million related to the impact of adopting the new revenue recognition standard (ASC 606) in 2018, higher promotion and servicing of $17 million, higher incentive compensation and higher base compensation, which resulted from higher fringe benefits and higher commissions. Other operating expenses excluding the Investment Management & Research segment were slightly lower resulting from productivity programs.

•Interest credited to policyholders’ account balances increased by ~~$25~~$178 million mainly ~~from~~due to higher interest rates on funding agreements in Corporate and Other and growth of SCS AVaccount values in our Individual Retirement segment, partially offset by the impact of the Global Atlantic Transaction in our Group Retirement segment.

•Policyholders’ benefits increased by $69 million mainly due to higher net mortality in our Protection Solutions segment.

•Commissions and distribution-related payments increased by $37 million mainly due to higher average Separate Accounts values in our Individual Retirement segment, higher Advisory fee type revenue in our Wealth Management segment and higher premiums from employee benefits in our Protection Solution segment.

•Amortization of DAC increased by $17 million mainly due to growth in the Individual Retirement segment from sales momentum.

•Net income attributable to the noncontrolling interest increased by $18 million mainly due to higher pre-tax earnings and an increase of noncontrolling interest.

Nine Months Ended September 30, 2023 Compared to the Nine Months Ended September 30, 2022

Net Income (Loss) Attributable to Holdings

Net income attributable to Holdings decreased by $91 million to a net income of $2.0 billion for the nine months ended September 30, 2023 from a net income of $2.1 billion for the nine months ended September 30, 2022. The following notable items were the primary drivers for the change in net income (loss):

Unfavorable items included:

•Net derivative losses increased by $3.4 billion mainly due to equity market appreciation during the nine months ended September 30, 2023 compared to equity market depreciation during the nine months ended September 30, 2022.

•Interest credited to policyholders’ account balances increased by $519 million mainly due to higher interest rates on funding agreements in Corporate and ~~Other.~~Other and growth of SCS account values in our Individual Retirement segment, partially offset by the impact of the Global Atlantic Transaction on our Group Retirement segment.

•Fee-type revenue decreased by $187 million mainly driven by lower investment advisory fees from our Investment Management and Research segment primarily driven by lower average AUM, and lower assets from the Global Atlantic Transaction in our Group Retirement segment.

•Policyholders’ benefits increased by $87 million mainly due to higher net mortality and growth in Employee Benefits in our Protection Solutions segment and higher benefits from GMIB annuitizations, which is offset by higher premiums, in our Legacy segment.

•Amortization of DAC increased by $36 million mainly due to growth in the Individual Retirement segment from sales momentum.

•Net income attributable to noncontrolling interest increased by $67 million mainly due to gains from AB’s consolidated VIEs, partially offset by lower AB pre-tax income.

These were partially offset by the following favorable items:

•Change in market risk benefits and purchased market risk benefits decreased by $1.6 billion mainly due to an increase in equity markets during 2023 compared to a decrease during 2022, partially offset by a lower increase in interest rates from 2023 compared to 2022.

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•Net investment income increased by $740 million mainly due to higher assets, higher investment yields, and higher income from seed capital investments, partially offset by lower alternative investment income and lower income from TIPS, offset in derivatives.

•Investment losses decreased by $336 million mainly due to rebalancing in 2022 versus sales to reduce duration in 2023.

•Compensation, benefits, interest and other operating expenses decreased by $191 million mainly due to lower litigation accrual in the second quarter 2022 in Corporate and Other, partially offset by an increase in pension costs resulting from the higher interest rate environment.

•Income tax expense decreased by ~~$20~~$1.3 billion primarily due to a partial release of the valuation allowance of $970 million on the deferred tax asset, and lower pre-tax income for the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022.

See “—Significant Factors Impacting Our Results—Effect of Assumption Updates on Operating Results” for more information regarding assumption updates.

Non-GAAP Operating Earnings

Non-GAAP Operating Earnings decreased by $160 million to $1.2 billion for the nine months ended September 30, 2023 from $1.4 billion in the nine months ended September 30, 2022. The following notable items were the primary drivers for the change in Non-GAAP Operating Earnings.

Unfavorable items included:

•Interest credited to policyholders’ account balances increased by $519 million mainly due to higher interest rates on funding agreements in Corporate and Other and growth of SCS account values in our Individual Retirement segment and higher interest rates in our Protection Solutions segment, partially offset by the impact of the Global Atlantic Transaction in our Group Retirement segment.

•Policyholders’ benefits increased by $162 million mainly due to higher net mortality and growth in Employee Benefits in our Protection Solutions segment and higher benefits from GMIB annuitizations, which is offset by higher premiums, in our Legacy segment.

•Fee-type revenue decreased by $85 million mainly driven by lower investment advisory fees from our Investment Management and Research segment primarily driven by lower average AUM, and lower assets from the Global Atlantic Transaction, partially offset by higher equity markets, in our Group Retirement segment.

•Net derivative losses increased by $38 million primarily from our Investment Management and Research segment driven by higher losses from economically hedging seed capital investments in rising equity markets.

•Amortization of DAC increased by $36 million mainly due to growth in our Individual Retirement segment from sales momentum.

•Net income attributable to the noncontrolling interest increased by $13 million mainly due to higher pre-tax earnings and an increase of noncontrolling interest.

These were partially offset by the following favorable items:

•Net investment income increased by $509 million mainly due to higher assets, higher investment yields and higher income from seed capital investments, partially offset by lower alternative investment income and lower income from TIPS, offset in derivatives.

•Remeasurement of liability for future policy benefits decreased by $67 million mainly due to favorable assumption updates and model changes in 2023 compared to 2022 and unfavorable experience in prior period in our Legacy assumed life insurance business.

•Compensation, benefits, interest expense and other operating costs decreased by $37 million mainly due to lower general and administrative costs primarily relating to lower portfolio servicing fees primarily offset by higher interest rates in our Investment Management and Research segment, partially offset by an increase in pension cost.

•Income tax expense decreased by $74 million mainly driven by lower pre-tax earnings and a lower effective tax rate ~~due to the Tax Reform Act.~~

in 2023.

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Results of Operations by Segment

We manage our business through the following ~~four~~six segments: Individual Retirement, Group Retirement, Investment Management and Research, Protection Solutions, Wealth Management and ~~Protection Solutions.~~Legacy. We report certain activities and items that are not included in our ~~four~~six segments in Corporate and Other. The following section presents our discussion of ~~Operating~~operating earnings (loss) by segment and AUM, AV and AVProtection Solutions Reserves by segment, as applicable. Consistent with U.S. GAAP guidance for segment reporting, operating earnings (loss) is our U.S. GAAP measure of segment performance. See Note 1517 of the Notes to the Consolidated Financial Statements for further information on ~~the Company’s~~our segments.

For interim reporting periods in 2018 and 2017, the Company calculates income tax expense using an estimated annual effective tax rate (“ETR”), with discrete items recognized in the period in which they occur. The tax expense calculated using the ETR is allocated to the Company’s business segments based on the proportion of each segment’s pre-tax Operating earnings (loss) to Non-GAAP Operating Earnings. Each business segment is also allocated its portion of any permanent tax items.

The following table summarizes ~~Operating~~operating earnings (loss) ~~by segment~~on our segments and Corporate and ~~Other~~Other:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Operating earnings (loss) by segment:
Individual Retirement	$	210	$	183	$	644	$	572
Group Retirement	105		99		301		354
Investment Management and Research	99		94		297		331
Protection Solutions	34		30		23		137
Wealth Management	40		22		114		78
Legacy	41		50		146		170
Corporate and Other	(116)		(92)		(307)		(264)
Non-GAAP Operating Earnings	$	413	$	386	$	1,218	$	1,378

Effective Tax Rates by Segment

Income tax expense is calculated using the ETR and then allocated to our business segments using a 17% ETR for ~~the three months ended March 31, 2018~~our retirement and ~~2017:~~protection businesses (Individual Retirement, Group Retirement, Protection Solutions and Legacy), a 24% ETR for Wealth Management and a 24% ETR for Investment Management and Research.

Three Months Ended March 31,
2018 2017
(in millions)
Operating earnings (loss):
Individual Retirement $ 360
$ 202
Group Retirement 76
59
Investment Management and Research 81
32
Protection Solutions 23
39
Total segment operating earnings 540
332
Corporate and Other (76 ) (28 )
Non-GAAP Operating Earnings $ 464
$ 304

~~Table of Contents~~

Individual Retirement

The Individual Retirement segment includes our variable annuity products which primarily meet the needs of individuals saving for retirement or seeking retirement income.

The following table summarizes ~~Operating~~operating earnings (loss) of our Individual Retirement ~~segment for the periods presented:~~segment:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Operating earnings (loss)	$	210	$	183	$	644	$	572

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Three Months Ended March 31,
2018 2017
(in millions)
Operating earnings $ 360
$ 202

Key components of Operating earnings are:

REVENUES
Policy charges, fee income and premiums $ 540
$ 519
Net investment income 228
177
Investment gains (losses), net including derivative gains (losses) (227 ) 140
Investment management, service fees and other income 188
183
Segment revenues 729
1,019
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits 5
461
Interest credited to policyholders’ account balances 59
47
Commissions and distribution related payments⁽¹⁾
144
158
Amortization of deferred policy acquisition costs, net⁽²⁾
(47 ) (54 )
Compensation, benefits, interest expense and other operating costs and expenses⁽³⁾
121
128
Segment benefits and other deductions $ 282
$ 740
Key components of operating earnings (loss) were:

~~(1) Includes $72 million and $84 million of deferred policy acquisition costs.~~


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
REVENUES
Policy charges, fee income and premiums	$	169	$	158	$	497	$	504
Net investment income	438		283		1,169		748
Net derivative gains (losses)	(5)		(16)		(15)		(34)
Investment management, service fees and other income	91		87		277		272
Segment revenues	$	693	$	512	$	1,928	$	1,490

BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	$	20	$	14	$	63	$	45
Remeasurement of liability for future policy benefits	—		(1)		—		(2)
Interest credited to policyholders’ account balances	186		85		475		211
Commissions and distribution-related payments	69		54		192		172
Amortization of deferred policy acquisition costs	102		85		283		247
Compensation, benefits and other operating costs and expenses	50		47		140		118
Interest expense	1		—		1		—
Segment benefits and other deductions	$	428	$	284	$	1,154	$	791

~~(2) Net of capitalization of $87 million and $102 million.~~

~~(3) Includes $15 million and $18 million of deferred policy acquisition costs.~~

The following table summarizes AV for our Individual Retirement ~~segment as~~segment:





	September 30, 2023		December 31, 2022
	(in millions)
AV (1)
General Account	$	46,332	$	37,822
Separate Accounts	36,820		36,455
Total AV	$	83,152	$	74,277

(1)AV presented are net of ~~the dates indicated:~~reinsurance.

March 31,
2018 December 31,
2017
(in millions)
AV
General Account $ 19,480
$ 19,059
Separate Accounts 82,310
84,364
Total AV $ 101,790
$ 103,423

~~Table of Contents~~

The following table summarizes a ~~roll forward~~roll-forward of AV for our Individual Retirement ~~segment for~~segment:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Balance, beginning of period	$	83,893	$	71,751	$	74,277	$	82,629
Gross premiums	3,832		3,019		10,377		8,877
Surrenders, withdrawals and benefits	(2,169)		(1,757)		(6,281)		(5,784)
Net flows	1,663		1,262		4,096		3,093
Investment performance, interest credited and policy charges	(2,404)		(3,360)		4,772		(16,069)
Other (1)	—		—		7		—
Balance, end of period	$	83,152	$	69,653	$	83,152	$	69,653

______________

(1)For the ~~periods indicated:~~nine months ended September 30, 2023, amounts reflect a total special payment applied to the accounts of active clients during the three months ended March 31, 2023 as part of a previously disclosed settlement agreement between Equitable Financial and the SEC.

111

March 31,
2018 March 31,
2017
(in millions)
Balance as of beginning of period $ 103,423
$ 93,604
Gross premiums 1,787
2,010
Surrenders, withdrawals and benefits (2,249 ) (1,797 )
Net flows (462 ) 213
Investment performance, interest credited and policy charges (1,171 ) 2,862
Balance as of end of period $ 101,790
$ 96,679

Table of Contents

~~First Quarter of 2018~~Three Months Ended September 30, 2023 Compared to ~~First Quarter of 2017~~the Three Months Ended September 30, 2022 for the Individual Retirement Segment

Operating earnings

Operating earnings increased ~~$158~~$27 million to ~~$360~~$210 million during the three months ended September 30, 2023 from $183 million in the ~~first quarter~~three months ended September 30, 2022. The following notable items were the primary drivers of ~~2018 from $202~~the change in operating earnings:

Favorable items included:

•Net investment income increased by $155 million ~~in the first quarter of 2017 primarily attributable to the following:~~

~~A net increase in Operating earnings of $78 million~~mainly due to higher ~~GMxB results from reserve strengthening in 2017. Higher interest rates were the primary driver of a $462 million decrease in GMxB Policyholders’ benefits which was~~SCS asset balances and higher investment yields, partially offset by ~~GMxB Net derivative losses of $384 million.~~lower income from TIPS offset in derivatives.

~~Increase in Net investment income of $51 million, resulting from higher asset balances mainly driven~~•Fee-type revenue increased by ~~SCS sales.~~

~~Increase in remaining Revenues of $26~~$15 million due to higher average Separate ~~Account AV, primarily due to positive market performance in 2017 and higher premium income from payout annuities.~~

~~A decrease in Commissions and distribution related payments of $14 million due to strong sales in the first quarter of 2017 in advance of the implementation of the DOL Rule.~~

~~The increase was partially offset by:~~

~~An increase in Amortization of DAC, net of $7 million primarily driven by $15 million lower DAC capitalization~~Accounts values as a result of higher equity markets in third quarter 2023.

•Net derivative losses decreased by $11 million mainly due to lower losses from TIPS hedging, offset in net investment income.

These were partially offset by the following unfavorable items:

•Interest credited to policyholders’ account balances increased by $101 million mainly due to the growth of SCS account values.

•Amortization of DAC increased by $17 million mainly driven by growth in the business from sales momentum.

•Commissions and ~~a product shift towards SCS.~~distribution-related payments increased by $15 million mainly due to higher average Separate Accounts values.

~~An increase in~~ •Income tax expense ~~of $9~~increased by $10 million ~~due to~~mainly driven by higher pre-tax ~~operating~~ earnings ~~partially offset by~~and a ~~lower~~higher effective tax rate ~~due to the Tax Reform Act.~~in third quarter 2023.

Net Flows and AV

•Total AV as of September 30, 2023 was $83.2 billion, a decrease of $741 million, compared to June 30, 2023. The decline in AV was primarily due to $2.4 billion of equity markets deprecation in third quarter 2023, partially offset by net inflows of $1.7 billion.

•Net inflows of $1.7 billion were $401 million higher than in the three months ended September 30, 2022, mainly driven by higher gross premiums on our newer, less capital-intensive products.

Nine Months Ended September 30, 2023 Compared to the Nine Months Ended September 30, 2022 for the Individual Retirement Segment

Operating earnings

Operating earnings increased $72 million to $644 million during the nine months ended September 30, 2023 from $572 million in the nine months ended September 30, 2022. The following notable items were the primary drivers of the change in operating earnings:

Favorable items included:

•Net investment income increased by $421 million mainly due to higher SCS asset balances and higher investment yields, partially offset by lower income from TIPS offset in derivatives.

•Net derivative losses decreased by $19 million mainly due to increased losses from TIPS hedging which is offset in net investment income.

These were partially offset by the following unfavorable items:

•Interest credited to policyholders’ account balances increased by $264 million mainly due to growth of SCS account values.

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•Amortization of DAC increased by $36 million mainly due to growth in the business from sales momentum.

•Compensation, benefits, interest expense and other operating costs increased by $23 million mainly due to an increase in pension costs resulting from the higher interest rate environment.

•Commissions and distribution-related payments increased by $20 million mainly due to growth in the SCS business.

•Policyholders’ benefits increased by $18 million mainly due to higher non-GMxB benefit elections, which is offset by higher premiums.

Net Flows and AV

•The increase in AV of ~~$5.1~~$8.9 billion ~~year-over-year~~in the nine months ended September 30, 2023 was driven by an increase in investments performance as a result of equity market ~~appreciation.~~appreciation of $4.8 billion in the first nine months of 2023, as well as net inflows of $4.1 billion.

•Net ~~outflows~~inflows of $4.1 billion were ~~$462 million, primarily~~$1.0 billion higher than in the nine months ended September 30, 2022, mainly driven by ~~$1.0 billion~~higher sales in the first nine months of ~~outflows on our older fixed GMxB block which were partially offset by $579 million~~2023 as compared to the first nine months of ~~inflows on our newer less capital intensive products.~~2022.

Group Retirement

The Group Retirement segment offers tax-deferred investment and retirement services or products to plans sponsored by educational entities, municipalities and not-for-profit entities, as well as small and medium-sized businesses.

The following table summarizes operating earnings (loss) of our Group Retirement segment:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Operating earnings (loss)	$	105	$	99	$	301	$	354

Key components of operating earnings (loss) are:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
REVENUES
Policy charges, fee income and premiums	$	71	$	80	$	201	$	257
Net investment income	128		160		372		503
Net derivative gains (losses)	—		(13)		(1)		(27)
Investment management, service fees and other income	68		60		199		187
Segment revenues	$	267	$	287	$	771	$	920

BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	$	—	$	—	$	—	$	—
Remeasurement of liability for future policy benefits	—		—		—		—
Interest credited to policyholders’ account balances	55		79		157		229
Commissions and distribution-related payments	35		33		119		117
Amortization of deferred policy acquisition costs	14		14		44		44
Compensation, benefits and other operating costs and expenses	31		36		89		96
Interest expense	—		1		—		1
Segment benefits and other deductions	$	135	$	163	$	409	$	487

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The following table summarizes ~~Operating earnings of our Group Retirement segment for the periods presented:~~

Three Months Ended March 31,
2018 2017
(in millions)
Operating earnings $ 76
$ 59

Key components of Operating earnings are:

REVENUES
Policy charges, fee income and premiums $ 64
$ 59
Net investment income 131
130
Investment gains (losses), net including derivative gains (losses) (1 ) (5 )
Investment Management, service fees and other income 44
43
Segment Revenues 238
227
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits —
—
Interest credited to policyholders’ account balances 70
71
Commissions and distribution related payments⁽¹⁾
24
23
Amortization of deferred policy acquisition costs, net⁽²⁾
(11 ) (11 )
Compensation, benefits, interest expense and other operating costs and expenses⁽³⁾
62
62
Segment benefits and other deductions $ 145
$ 145

~~(1) Includes $14 million~~AV and ~~$12 million of deferred policy acquisition costs.~~

~~(2) Net of capitalization of $22 million and $21 million.~~

~~(3) Includes $8 million and $9 million of deferred policy acquisition costs.~~

~~The following tables summarize AV~~AUA for our Group Retirement ~~Segment as~~segment:




	September 30, 2023		December 31, 2022
	(in millions)
AV and AUA
General Account	$	9,016	$	9,175
Separate Accounts and Mutual Funds	24,833		22,830
Total AV and AUA (2)	$	33,849	$	32,005

____________

(1) AV presented are net of ~~the dates indicated:~~

March 31,
2018 December 31,
2017
(in millions)
AV
General Account $ 11,393
$ 11,319
Separate Accounts 22,525
22,587
Total AV $ 33,918
$ 33,906

~~Table of Contents~~

reinsurance.

The following table summarizes a roll-forward of AV and AUA for our Group Retirement ~~segment for~~segment:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Balance, beginning of period	$	34,985	$	41,167	$	32,005	$	47,809
Gross premiums	818		861		2,709		3,496
Surrenders, withdrawals and benefits	(993)		(918)		(2,920)		(2,886)
Net flows (1)	(175)		(57)		(211)		610
Investment performance, interest credited and policy charges (1)	(961)		(1,400)		2,025		(8,709)

Other (2)	—		—		30		—
Balance, end of period	$	33,849	$	39,710	$	33,849	$	39,710

____________

(1)For the ~~periods indicated:~~three and nine months ended September 30, 2023, net outflows of $172 million and $492 million and investment performance, interest credited and policy charges of $275 million and $474 million, respectively, are excluded as these amounts are related to ceded AV to Global Atlantic.

(2) For the nine months ended September 30, 2023, amounts reflect a total special payment applied to the accounts of active clients as part of a previously disclosed settlement agreement between Equitable Financial and the SEC.

Three Months Ended March 31,
2018 2017
(in millions)
Balance as of beginning of period $ 33,906
$ 30,138
Gross premiums 837
824
Surrenders, withdrawals and benefits (736 ) (769 )
Net flows 101
55
Investment performance, interest credited and policy charges (89 ) 975
Balance as of end of period $ 33,918
$ 31,168

~~First Quarter of 2018~~Three Months Ended September 30, 2023 Compared to ~~First Quarter of 2017~~the Three Months Ended September 30, 2022 for the Group Retirement Segment

Operating earnings

Operating earnings increased ~~$17~~by $6 million to ~~$76~~$105 million during the three months ended September 30, 2023 from $99 million in the three months ended September 30, 2022. The following notable items were the primary drivers of the change in operating earnings:

Favorable items included:

•Interest credited to policyholders’ account balances decreased by $24 million mainly due to the portion of policies ceded in the Global Atlantic Transaction.

•Net derivative losses decreased by $13 million due to lower losses from TIPS hedging which is offset in net investment income.

These were partially offset by the following unfavorable items:

•Net investment income decreased by $32 million due to lower assets from the Global Atlantic Transaction and lower income from TIPS offset in derivatives, partially offset by higher investment yields.

See “—Significant Factors Impacting Our Results—Effect of Assumption Updates on Operating Results” for more information regarding assumption updates.

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Net Flows and AV

•The decrease in AV of $1.1 billion in the three months ended September 30, 2023 was driven by equity market depreciation of $961 million and net outflows of $175 million.

•Net outflows of $175 million for the ~~first quarter of 2018 from $59~~three months ended September 30, 2023 increased by $118 million ~~in the first quarter of 2017.~~

~~The increase is primarily attributable~~compared to the ~~following:~~three months ended September 30, 2022, driven by higher surrender activity, partially offset by higher gross premiums in our institutional market.

~~Higher fee~~

Nine Months Ended September 30, 2023 Compared to the Nine Months Ended September 30, 2022 for the Group Retirement Segment

Operating earnings

Operating earnings decreased by $53 million to $301 million during the nine months ended September 30, 2023 from $354 million during the nine months ended September 30, 2022. The following notable items were the primary drivers of the change in operating earnings:

Unfavorable items included:

•Net investment income ~~from Policy charges, fee income and premiums and Investment management, service fees and other income of $6~~decreased by $131 million due to ~~positive net flows~~lower alternative investment income, lower income from TIPS partially offset in derivatives and lower assets from the Global Atlantic Transaction, partially offset by higher investment yields.

•Fee-type revenue decreased by $44 million primarily due to lower assets from the Global Atlantic Transaction, partially offset by higher equity market performance.

~~A decrease~~These were partially offset by the following favorable items:

•Interest credited to policyholders’ account balances decreased by $72 million mainly due to the portion of policies ceded in the Global Atlantic Transaction.

•Net derivative losses decreased by $26 million due to lower losses from TIPS hedging which is offset in net investment income.

•Income tax expense ~~of $6~~decreased by $18 million ~~due to~~driven by lower pre-tax earnings and a lower effective tax rate ~~as a result of the Tax Reform Act.~~in 2023.

Net Flows and AV

•The increase in AV of ~~$2.8~~$1.8 billion ~~from~~in the ~~first quarter of 2018~~nine months ended September 30, 2023 was ~~primarily due to~~driven by equity market appreciation ~~and positive~~of $2.0 billion, slightly offset by net ~~flows.~~outflows of $211 million.

•Net ~~flows were $101~~outflows of $211 million ~~a $46 million increase~~ for the ~~first quarter of 2018,~~nine months ended September 30, 2023 increased $821 million compared to the nine months ended September 30, 2022, driven ~~primarily~~ by a ~~$13 million increase~~large lump sum premium in ~~Gross premiums~~our institutional market in 2022 and ~~a reduction~~higher surrender activity in 2023.

115

Table of ~~$33 million in Surrenders and withdrawals.~~Contents

Investment Management and Research

The Investment Management and Research segment provides diversified investment management, research and related services to a broad range of clients around the world. Operating earnings (loss), net of tax, presented here represents our ~~March 31, 2018~~average economic interest ~~net of tax,~~ in AB of approximately ~~46.5%. Giving effect to~~61% and 65% during the ~~AB Reorganization Transactions that occurred on April 23, 2018, our current economic interest in AB at April~~nine months ended September 30, ~~2018 was approximately 64.8%.~~2023 and 2022.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Operating earnings (loss)	$	99	$	94	$	297	$	331

~~Table~~Key components of ~~Contents~~

operating earnings (loss) were:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
REVENUES

Net investment income (loss)	$	(9)	$	(9)	$	2	$	(58)
Net derivative gains (losses)	9		15		(2)		57
Investment management, service fees and other income	1,034		990		3,043		3,135
Segment revenues	$	1,034	$	996	$	3,043	$	3,134

BENEFITS AND OTHER DEDUCTIONS


Commissions and distribution related payments	$	156	$	152	$	454	$	487

Compensation, benefits and other operating costs and expenses	644		636		1,900		1,930
Interest expense	14		5		42		9
Segment benefits and other deductions	$	814	$	793	$	2,396	$	2,426

~~The following table summarizes Operating earnings of our Investment Management and Research segment for the periods presented:~~

Three Months Ended March 31,
2018 2017
(in millions)
Operating earnings $ 81
$ 32

Key components of Operating earnings are:

REVENUES
Policy charges, fee income and premiums $ —
$ —
Net investment income 3
19
Investment gains (losses), net including derivative gains (losses) 2
(10 )
Investment Management, service fees and other income 904
734
Segment Revenues 909
743
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits —
—
Interest credited to policyholders’ account balances —
—
Commissions and distribution related payments 110
96
Amortization of deferred policy acquisition costs, net —
—
Compensation, benefits, interest expense and other operating costs and expenses 564
497
Segment benefits and other deductions $ 674
$ 593

Changes in AUM in the Investment Management and Research segment ~~for the periods presented~~ were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in billions)
Balance, beginning of period	$	691.5	$	646.8	$	646.4	$	778.6
Long-term flows
Sales/new accounts	25.2		19.8		73.2		84.6
Redemptions/terminations	(20.3)		(24.9)		(64.1)		(72.2)
Cash flow/unreinvested dividends	(6.8)		(5.4)		(14.3)		(14.2)
Net long-term (outflows) inflows	(1.9)		(10.5)		(5.2)		(1.8)
Adjustments	—		—		—		(0.4)
Acquisition	—		12.2		—		12.2

Market appreciation (depreciation)	(20.6)		(35.8)		27.8		(175.9)
Net change	(22.5)		(34.1)		22.6		(165.9)
Balance, end of period	$	669.0	$	612.7	$	669.0	$	612.7

Three Months Ended March 31,
2018 2017
(in billions)
Balance as of beginning of period $ 554.5
$ 480.2
Long-term flows:
Sales/new accounts 34.1
19.0
Redemptions/terminations (31.2 ) (18.4 )
Cash flow/unreinvested dividends (5.3 ) (0.8 )
Net long-term (outflows) inflows (2.4 ) (0.2 )
Market appreciation (depreciation) (2.6 ) 17.9
Net change (5.0 ) 17.7
Balance as of end of period $ 549.5
$ 497.9

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Average AUM in the Investment Management and Research segment for the periods presented by distribution channel and investment services were as follows:

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	Three Months Ended March 31,					Three Months Ended September 30,				Nine Months Ended September 30,
	2018		2017			2023		2022		2023		2022
	(in billions)					(in billions)
Distribution Channel:					Distribution Channel:
Institutions	$	269.3	$	243.8	Institutions	$	307.0	$	297.0	$	305.1	$	312.8
Retail	194.0		164.9		Retail	266.8		250.9		259.2		274.9
Private Wealth Management	93.8		82.5
Private Wealth					Private Wealth	115.8		106.0		112.9		111.6
Total	$	557.1	$	491.2	Total	$	689.6	$	653.9	$	677.2	$	699.3

Investment Service:					Investment Service:
Equity Actively Managed	$	142.9	$	115.7	Equity Actively Managed	$	235.8	$	222.8	$	230.7	$	245.7
Equity Passively Managed⁽¹⁾	54.3		48.7		Equity Passively Managed (1)	59.3		56.7		57.5		61.8
Fixed Income Actively Managed – Taxable	243.3		226.0		Fixed Income Actively Managed – Taxable	200.3		198.9		197.9		216.4
Fixed Income Actively Managed – Tax-exempt	40.6		37.3		Fixed Income Actively Managed – Tax-exempt	56.3		53.7		55.2		54.7
Fixed Income Passively Managed⁽¹⁾	10.0		11.1		Fixed Income Passively Managed (1)	9.4		11.3		9.5		12.1
Other⁽²⁾	66.0		52.4
Alternatives/Multi-Asset Solutions (2)					Alternatives/Multi-Asset Solutions (2)	128.5		110.5		126.4		108.6
Total	$	557.1	$	491.2	Total	$	689.6	$	653.9	$	677.2	$	699.3

____________

(1)Includes index and enhanced index services.

(2)Includes certain multi-asset solutions and services ~~and certain alternative investments.~~not included in equity of fixed income services.

~~First Quarter of 2018~~Three Months Ended September 30, 2023 Compared to ~~First Quarter of 2017~~the Three Months Ended September 30, 2022 for the Investment Management and Research Segment

Operating earnings

Operating earnings increased ~~$49~~$5 million to $99 million during the three months ended September 30, 2023 from $94 million during the three months ended September 30, 2022. The following notable items were the primary drivers of the change in ~~the first quarter of 2018 to $81 million from $32 million in the first quarter of 2017 primarily attributable to the following:~~operating earnings:

~~Increase in Investment management, service fees, and other income of $170~~Favorable items included:

•Fee-type revenue increased by $44 million primarily due to higher investment advisory base fees ~~of $75 million resulting from a 13% increase in~~driven by higher average AUM ~~and a 2% increase in the overall~~partially offset by lower portfolio ~~rate. Operating earnings includes an increase in revenues of $78 million from the impact of adopting the new revenue recognition standard (ASC 606) in 2018.~~

~~Income tax expense decreased $8 million driven by a lower effective tax rate~~fee rates, higher performance based fees due to ~~the Tax Reform Act.~~increased performance fees earned on Private Credit Funds, partially offset by lower performance fees on U.S. Real Estate Funds and higher other income from higher net interest earned on customer margin balances.

~~This increase was~~These were partially offset by the ~~following:~~following unfavorable items included:

~~Higher~~ •Compensation, benefits, interest expense and other operating costs ~~of $67~~increased by $17 million ~~including $43 million~~mainly due to higher expense related to ~~the impact of adoption of revenue recognition standard (ASC 606) in 2018,~~ higher ~~promotion~~average outstanding borrowings and ~~servicing expenses of $17 million,~~higher interest rates and higher incentive ~~compensation, higher~~and base compensation expense, partially offset by lower general and administrative costs related to lower portfolio servicing fees and professional fees.

•Net derivative gains decreased by $6 million mainly due to lower gains from economically hedging seed capital investments.

•Net income attributable to noncontrolling interest increased by $11 million due to higher ~~fringe benefits~~pre-tax earnings and ~~higher commissions.~~an increase of noncontrolling interest.

Long-Term Net Flows and AUM

•Total AUM as of ~~March 31, 2018~~September 30, 2023 was ~~$549.5~~$669.0 billion, ~~up $51.6~~down $22.5 billion or ~~10%~~3.3%, compared to ~~first~~June 30, 2023. During the third quarter 2023, AUM decreased as a result of ~~2017. The increase was driven by~~ market ~~appreciation~~depreciation of ~~$40.7~~$20.6 billion and net ~~flows~~outflows of ~~$10.9~~$1.9 billion. Market depreciation was attributed to Retail of 9.0 billion, ~~(primarily~~Institutions of 8.8 billion, and Private Wealth of 2.8 billion. Net outflows were due to Institutions net outflows of $3.5 billion, Retail ~~and Institutional~~net inflows of ~~$8.7 billion).~~

$1.6 billion and Private Wealth net inflows of $0.0 billion.

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Nine Months Ended September 30, 2023 Compared to the Nine Months Ended September 30, 2022 for the Investment Management and Research Segment

Operating earnings

Operating earnings decreased $34 million to $297 million during the nine months ended September 30, 2023 from $331 million in the nine months ended September 30, 2022. The following notable items were the primary drivers of the change in operating earnings:

Unfavorable items included:

•Fee-type revenue decreased by $92 million primarily due to lower investment advisory base fees driven by lower average AUM partially offset by higher portfolio fee rates, lower performance based fees due to lower performance fees earned on U.S. Real Estate Funds partially offset by higher performance fees on Private Credit Funds and Global Core Equity Funds, partially offset by higher other income from higher net interest earned on customer margin balances.

•Net derivative gains decreased by $59 million mainly due to lower income from economically hedging the seed capital investments (partially offset by net investment income).

•Compensation, benefits, interest expense and other operating costs increased by $3 million mainly due to higher expense related to higher average outstanding borrowings and higher interest rates as well as higher incentive and base compensation expense, primarily offset by lower general and administrative costs related to lower portfolio servicing fees and professional fees.

These were partially offset by the following favorable items:

•Net investment income increased by $60 million mainly due to higher income from seed capital investments (partially offset by net derivative losses).

•Commissions and distribution-related payments decreased by $33 million mainly due to lower payments to financial intermediaries for the distribution of AB mutual funds.

•Income tax expense decreased by $25 million due to lower pre-tax earnings and a lower effective tax rate in 2023.

Long-Term Net Flows and AUM

•Total AUM as of September 30, 2023 was $669.0 billion, up $22.6 billion, or 3.5%, compared to December 31, 2022. The increase is a result of market appreciation of $27.8 billion, partially offset by net outflows of $5.2 billion. Market appreciation attributed to Retail of $13.9 billion, Institutions of $8.9 billion and Private Wealth of $5.0 billion. Institutions net outflows of $9.4 billion were partially offset by Private Wealth and Retail net inflows of $2.5 billion and $1.7 billion , respectively.

Protection Solutions

The Protection Solutions segment includes our life insurance and employee benefits businesses. We provide a targeted range of products aimed at serving the financial needs of our clients throughout their lives, including ~~Variable Universal Life (“VUL”),~~VUL, IUL and term life products. In 2015, we entered the employee benefits market and currently offer a suite of dental, vision, life, as well as short- and long-term disability insurance products to small and medium-size businesses.

In recent years, we have refocused our product offering and distribution towards less capital intensive, higher return accumulation and protection products. For example, in January 2021, we discontinued offering our most interest sensitive IUL product. We plan to improve our operating earnings over time through earnings generated from sales of our repositioned product portfolio and by proactively managing and optimizing our in-force book.

The following table summarizes ~~Operating~~operating earnings (loss) of our Protection Solutions ~~segment for the periods presented:~~segment:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Operating earnings (loss)	$	34	$	30	$	23	$	137

118

Three Months Ended March 31,
2018 2017
(in millions)
Operating earnings (loss) $ 23
$ 39

Key components of Operating earnings are:

REVENUES
Policy charges, fee income and premiums $ 535
$ 529
Net investment income 220
208
Investment gains (losses), net including derivative gains (losses) (1 ) —
Investment management, service fees and other income 55
52
Segment Revenues 809
789
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits 409
412
Interest credited to policyholders’ account balances 122
116
Commissions and distribution related payments⁽¹⁾
66
68
Amortization of deferred policy acquisition costs, net⁽²⁾
71
29
Compensation, benefits, interest expense and other operating costs and expenses⁽³⁾
114
109
Segment benefits and other deductions $ 782
$ 734

~~(1) Includes $34 million and $36 million of deferred policy acquisition costs.~~

~~(2) Net of capitalization of $51 million and $50 million.~~

~~(3) Includes $17 million and $14 million of deferred policy acquisition costs.~~

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Key components of operating earnings (loss) were:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
REVENUES
Policy charges, fee income and premiums	$	516	$	502	$	1,560	$	1,507
Net investment income	260		236		719		760
Net derivative gains (losses)	7		(13)		(11)		(18)
Investment management, service fees and other income	39		34		105		108
Segment revenues	$	822	$	759	$	2,373	$	2,357

BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	$	512	$	430	$	1,531	$	1,376
Remeasurement of liability for future policy benefits	(16)		22		(12)		35

Interest credited to policyholders’ account balances	137		130		392		380
Commissions and distribution related payments	37		31		107		99
Amortization of deferred policy acquisition costs	30		29		89		87
Compensation, benefits and other operating costs and expenses	79		79		236		212
Interest expense	2		—		2		—
Segment benefits and other deductions	$	781	$	721	$	2,345	$	2,189

The following table summarizes Protection Solutions Reserves for our Protection Solutions ~~segment~~segment:




	September 30, 2023		December 31, 2022
	(in millions)
Protection Solutions Reserves (1)
General Account	$	17,949	$	18,208
Separate Accounts	14,782		13,634
Total Protection Solutions Reserves	$	32,731	$	31,842

_______________

(1)Does not include Protection Solutions Reserves for our employee benefits business as ~~of the dates indicated:~~it is a scaling business and therefore has immaterial in-force policies.

March 31, 2018 December 31, 2017
(in millions)
Protection Solutions Reserves⁽¹⁾

General Account $ 16,128
$ 16,007
Separate Accounts 12,396
12,643
Total Protection Solutions Reserves $ 28,524
$ 28,650


~~(1)~~	~~Does not include Protection Solutions Reserves for our employee benefits business as it is a start-up business and therefore has immaterial in-force policies.~~

The following table presents our in-force face amounts for ~~the periods indicated, respectively, for~~ our individual life insurance products:





	September 30, 2023		December 31, 2022
	(in billions)
In-force face amount by product: (1)
Universal Life (2)	$	41.5	$	43.1
Indexed Universal Life	27.1		27.5
Variable Universal Life (3)	135.4		133.4
Term	208.1		211.9
Whole Life	1.1		1.1
Total in-force face amount	$	413.2	$	417.0

_______________

(1)Includes individual life insurance and does not include employee benefits as it is a scaling business and therefore has immaterial in-force policies.

(2)UL includes GUL.

(3)VUL includes VL and COLI.

119

March 31, 2018 December 31, 2017
(in billions)
In-force Face Amounts for Protection Solutions⁽¹⁾

Universal life⁽²⁾
$ 58.3
$ 59.0
Indexed universal life 21.0
20.5
Variable universal life⁽³⁾
128.5
128.9
Term 234.7
235.9
Whole life 1.6
1.6
Total in-force face amount $ 444.1
$ 445.9


~~(1)~~	~~Includes individual life insurance and does not include employee benefits as it is a start-up business and therefore has immaterial in-force policies.~~


~~(2)~~	~~Universal Life includes Guaranteed Universal Life.~~


~~(3)~~	~~Variable Universal Life includes VL and COLI.~~

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~~First Quarter of 2018~~Three Months Ended September 30, 2023 Compared to the ~~First Quarter~~Three Months Ended September 30, 2022 for the Protection Solutions Segment

Operating earnings (loss)

Operating earnings increased by $4 million to $34 million during the three months ended September 30, 2023 from $30 million in the three months ended September 30, 2022. The following notable items were the primary drivers of ~~2017~~the change in operating earnings:

Favorable items included:

•Remeasurement of liability for future policy benefits decreased by $38 million mainly due to favorable assumption updates in third quarter 2023 compared to third quarter 2022.

•Net investment income increased by $24 million mainly due to higher alternative investment income and higher investment yields, partially offset by lower income from TIPS offset in derivatives.

•Net derivative lossses decreased by $20 million mainly due to lower losses from TIPS hedging which is offset in net investment income.

•Fee-type revenue increased by $19 million mainly driven by Employee Benefits premium growth.

These were partially offset by the following unfavorable items:

•Policyholders’ benefits increased by $82 million mainly due to higher net mortality.

•Commissions and distribution-related payments increased by $6 million mainly due to higher premiums in Employee Benefits.

Nine Months Ended September 30, 2023 Compared to the Nine Months Ended September 30, 2022 for the Protection Solutions Segment

Operating earnings (loss)

Operating earnings decreased ~~$16~~$114 million to $23 million induring the ~~first quarter of 2018~~nine months ended September 30, 2023 from ~~$39~~$137 million in the ~~first quarter~~nine months ended September 30, 2022. The following notable items were the primary drivers of ~~2017 primarily attributable to~~ the ~~following:~~change in the operating loss:

~~Amortization of DAC, net~~Unfavorable items included:

•Policyholders’ benefits increased by ~~$42~~$155 million due to a $44 million increase in DAC amortization before capitalization, as we have remained in a loss recognition position in the first quarter of 2018 (loss recognition position started in the fourth quarter of 2017) which results in higher amortization.

~~Increase of $6 million in Interest credited to policyholders' account balances~~ mainly due to higher AVnet mortality and growth in ~~our Indexed Universal Life products.~~

Employee Benefits.

•Net investment income decreased by $41 million mainly due to lower alternative investment income, lower income from TIPS partially offset in derivatives, partially offset by higher investment yields.

•Compensation, benefits, interest expense and other operating costs increased by $26 million mainly due to higher pension and other benefit costs.

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•Interest credited to policyholders’ account balances increased by $12 million mainly due to higher interest rates.

~~This decrease was~~These were partially offset by the ~~following:~~following favorable items:

~~Increase in Net investment income of $12~~•Fee-type revenue increased by $50 million mainly driven by higher premiums due to ~~the General Account portfolio rebalancing and higher asset balances.~~growth in Employee Benefits (offset in policyholders’ benefits).

~~Increase~~•Remeasurement of $6liability for future policy benefits decreased by $47 million ~~in Policy charges, fee income and premiums,~~ mainly due to favorable assumption updates in 2023 compared to 2022.

•Income tax expense decreased by $26 million primarily due to a lower pre-tax earnings.

Wealth Management

The Wealth Management segment is an ~~increase~~emerging leader in ~~cost~~the wealth management space with a differentiated advice value proposition that offers discretionary and non-discretionary investment advisory accounts, financial planning and advice,

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insurance, ~~charges.~~and annuity products. In 2023, we began reporting this business separately from our other segments and Corporate and Other.

~~Increase~~The following table summarizes operating earnings (loss) of $3our Wealth Management segment:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Operating earnings (loss)	$	40	$	22	$	114	$	78

Key components of operating earnings (loss) were:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
REVENUES

Net investment income	$	4	$	1	$	9	$	1
Net derivative gains (losses)	—		—		—		—
Investment management, service fees and other income	386		352		1,134		1,096
Segment revenues	$	390	$	353	$	1,143	$	1,097

BENEFITS AND OTHER DEDUCTIONS




Commissions and distribution-related payments	$	244	$	231	$	715	$	715

Compensation, benefits and other operating costs and expenses	93		92		278		276
Interest expense	—		—		—		—
Segment benefits and other deductions	$	337	$	323	$	993	$	991

The following table summarizes a revenue by activity type for our Wealth Management segment:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Revenue by Activity Type
Investment management, service fees and other income :
Investment management and advisory fees	$	141	$	125	$	402	$	399
Distribution fees	229		219		685		679
Interest income	13		5		37		7
Service and other income	3		3		10		12
Total Investment management, service fees and other income	$	386	$	351	$	1,134	$	1,096

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The following table summarizes a roll-forward of AUA roll-forward for our Wealth Management segment:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Total Wealth Management Assets
Beginning, beginning of period	80,421		$	70,411	$	72,406	$	82,794
Net Flows	1,560		1,117		4,323		3,937
Market appreciation (depreciation) and other	(2,622)		(3,135)		2,630		(18,338)
Balance, end of period	$	79,359	$	68,393	$	79,359	$	68,393

Three Months Ended September 30, 2023 Compared to the Three Months Ended September 30, 2023 for the Wealth Management Segment

Operating earnings

Operating earnings increased by $18 million to $40 million during the three months ended September 30, 2023 from $22 million in the three months ended September 30, 2022. The following were notable changes:

Favorable items included:

•Investment management, service fees and other income increased by $34 million mainly due to higher ~~Separate Account reserves.~~Advisory fee type revenue attributed to higher average assets balances combined with increased interest income from sweep accounts.

~~Decrease in~~•Net investment income increased by $3 million mainly due to higher interest rates.

These were partially offset by the following unfavorable items:

•Commissions and distribution-related payments increased by $13 million mainly due to higher Advisory fee type revenue.

•Income tax expense ~~of $12~~increased by $5 million primarily due to higher pre-tax earnings.

Net Flows and AV

•The decrease in AUA of $1.1 billion in the three months ended September 30, 2023 was driven by equity market depreciation in 2023 of $2.6 billion as well as net inflows of $1.6 billion.

•Net inflows of $1.6 billion were $443 million higher than in the three months ended September 30, 2022 mainly driven by increased sales.

Nine Months Ended September 30, 2023 Compared to the Nine Months Ended September 30, 2022 for the Wealth Management Segment

Operating earnings

Operating earnings increased $36 million to $114 million during the nine months ended September 30, 2023 compared to $78 million in the nine months ended September 30, 2022. The following were notable changes:

Favorable items included:

•Investment management, service fees and other income increased by $38 million mainly due to higher interest income from sweep accounts combined with increased distribution fees from higher retirement sales.

•Net investment income increased by $8 million mainly due to higher interest rates.

These were partially offset by the following unfavorable items:

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•Income tax expense increased by $8 million primarily due to higher pre-tax earnings, partially offset by a lower effective tax rate.

Net Flows and AV

•The increase in AUA of $7.0 billion in the nine months ended September 30, 2023 was driven by net inflows of $4.3 billion in 2023 and equity market appreciation of $2.6 billion.

•Net inflows of $4.3 billion were $386 million higher than in the nine months ended September 30, 2022 mainly driven by increased sales.

Legacy

The Legacy segment consists of our capital intensive fixed-rate GMxB business written prior to 2011. In 2023, we began reporting this business separately from our Individual Retirement business.

The following table summarizes operating earnings (loss) of our Legacy segment:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Operating earnings (loss)	$	41	$	50	$	146	$	170

Key components of operating earnings (loss) were:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
REVENUES
Policy charges, fee income and premiums	$	40	$	37	$	118	$	109
Net investment income	59		65		185		185
Net derivative gains (losses)	—		—		—		—
Investment management, service fees and other income	99		102		304		324
Segment revenues	$	198	$	204	$	607	$	618

BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	$	53	$	45	$	160	$	119
Remeasurement of liability for future policy benefits	1		(1)		1		1

Interest credited to policyholders’ account balances	12		13		36		38
Commissions and distribution-related payments	45		42		131		144
Amortization of deferred policy acquisition costs	16		16		48		49
Compensation, benefits and other operating costs and expenses	20		26		57		59
Interest expense	—		—		—		—
Segment benefits and other deductions	$	147	$	141	$	433	$	410

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The following table summarizes AV for our Legacy segment:





	September 30, 2023		December 31, 2022
	(in millions)
AV (1)
General Account	$	876	$	925
Separate Accounts	20,033		20,557
Total AV	$	20,909	$	21,482

_______________

(1)AV presented are net of reinsurance.

The following table summarizes a roll-forward of AV for our Legacy segment:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Balance, beginning of period	$	22,372	$	22,513	$	21,482	$	29,275
Gross premiums	74		66		200		189
Surrenders, withdrawals and benefits	(628)		(565)		(1,846)		(1,832)
Net flows	(554)		(499)		(1,646)		(1,643)
Investment performance, interest credited and policy charges	(909)		(1,145)		1,073		(6,763)
Balance, end of period	$	20,909	$	20,869	$	20,909	$	20,869

Three Months Ended September 30, 2023 Compared to the Three Months Ended September 30, 2023 for the Legacy segment

Operating earnings

Operating earnings decreased $9 million to $41 million during the three months ended September 30, 2023 from $50 million in the three months ended September 30, 2022. The following notable items were the primary drivers of the change in operating earnings:

Unfavorable items included:

•Policyholders’ benefits increased by $8 million mainly due to higher GMIB annuitizations, which is offset by higher premiums.

•Net investment income decreased by $6 million mainly due to lower assets.

These were partially offset by the following favorable items:

•Compensation, benefits, interest expense and other operating costs decreased by $6 million mainly due to lower pension and other benefit costs.

Net Flows and AV

•The decrease in AV of $1.5 billion in the three months ended September 30, 2023 was driven by a decrease in investments performance of $909 million as a result of equity market depreciation in third quarter 2023, and net outflows of $554 million.

•Net outflows of $554 million were $55 million higher than in the nine months ended September 30, 2022, mainly driven by continuing runoff of the business.

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Nine Months Ended September 30, 2023 Compared to the Nine Months Ended September 30, 2022 for the Legacy segment

Operating earnings

Operating earnings decreased $24 million to $146 million during the three months ended September 30, 2023 from $170 million in the nine months ended September 30, 2022. The following notable items were the primary drivers of the change in operating earnings:

Unfavorable items included:

•Policyholders’ benefits increased by $41 million mainly due to higher benefits from GMIB annuitizations, which is offset by higher premiums.

•Fee-type revenue decreased by $11 million mainly driven by lower average Separate Accounts values as a result of lower equity markets and net outflows, partially offset by higher premiums from the GMIB annuitizations.

These were partially offset by the following favorable items:

•Commissions and distribution-related payments decreased by $13 million mainly due to lower average Separate Accounts values as result of lower equity markets and net outflows, partially offset by lower commission reimbursements recorded in other income.

•Income tax expense decreased by $10 million primarily due to lower pre-tax earnings and a lower effective tax rate ~~as a result~~in 2023.

Net Flows and AV

•The decrease in AV of $573 million in the ~~Tax Reform Act.~~nine months ended September 30, 2023 was driven by net outflows of $1.6 billion, partially offset by an increase in investments performance and interest credited to account balances, net of policy charges, of $1.1 billion.

•Net outflows of $1.6 billion were consistent with the nine months ended September 30, 2022.

Corporate and Other

Corporate and Other includes ~~certain~~some of our financing and investment expenses. It also includes: ~~AXA Advisors broker-dealer business,~~ the Closed Block, run-off variable annuity reinsurance business, run-off group pension business, run-off health business, benefit plans for our employees, certain strategic investments and certain unallocated items, including capital and related investments, interest expense and financing fees and corporate expense. AB’s results of operations are reflected in the Investment Management and Research segment. Accordingly, Corporate and Other does not include any items applicable to AB.

The following table summarizes ~~Operating~~operating earnings (loss) of Corporate and ~~Other for the periods presented:~~Other:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Operating earnings (loss)	$	(116)	$	(92)	$	(307)	$	(264)

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Three Months Ended March 31,
2018 2017
(in millions)
Operating earnings (loss) $ (76 ) $ (28 )

Table of Contents

General Account Investment ~~Assets~~ Portfolio

~~The GAIA portfolio~~Our investment philosophy is driven by our long-term commitments to clients, robust risk management and ~~investment results support the insurance and annuity liabilities of our Individual Retirement, Group Retirement and Protection Solutions businesses.~~strategic asset allocation. Our ~~GAIA~~General Account investment portfolio investment strategy seeks to achieve sustainable risk-adjusted returns by focusing on principal preservation and investment return, subject to duration and liquidity requirements by product ~~class and the~~as well as diversification of investment risks. Investment activities are undertaken ~~according to~~based on established investment ~~policy statements that contain internally established~~ guidelines and are required to comply with applicable laws and insurance regulations.

Risk tolerances are established for credit risk, market risk, liquidity risk and concentration risk across ~~types of~~ issuers and asset classes, ~~that~~each of which seek to mitigate the impact of cash flow variability arising from these risks. Significant interest rate increases and market volatility since 2022 have reduced the fair value of fixed maturities from a net unrealized gain position to a net unrealized loss. As a part of asset and liability management, we maintain a weighted average duration for our General Account investment portfolio that is within an acceptable range of the estimated duration of our liabilities given our risk appetite and hedging programs.

The ~~GAIA~~General Account investment portfolio consists largely of investment grade fixed maturities, ~~and~~ short-term investments, commercial, agricultural and ~~agricultural~~residential mortgage loans, ~~below investment grade fixed maturities,~~ alternative investments and other financial instruments. Fixed maturities include publicly issued corporate bonds, government bonds, privately placed notes and bonds, bonds issued by states and municipalities, agency and non-agency mortgage-backed securities and asset-backed securities.

As part of our asset and liability management strategies, we maintain a weighted average duration for our GAIA portfolio that is within an acceptable range of the estimated duration of our liabilities given our risk appetite and hedging programs. The GAIA portfolio includes credit derivatives to replicate exposure to individual securities or pools of securities as a means of achieving credit exposure similar to bonds of the underlying issuer(s) more efficiently. In addition, from time to time we use derivatives ~~for hedging purposes~~ to ~~reduce~~hedge our exposure to equity markets, interest rates, foreign currency and credit spreads.

We incorporate ESG factors into the investment processes for a significant portion of our General Account portfolio. As investors with a long-term horizon, we believe that companies with sustainable practices are better positioned to deliver value to stakeholders over an extended period. These companies are more likely to increase sales through sustainable products, reduce energy costs and attract and retain talent. This belief underpins our approach to sustainable investing, where we seek to enhance the sustainability and quality of our investment portfolio.

~~104~~

~~Table~~Investments in our surplus portfolio are generally comprised of ~~Contents~~

~~Investment portfolios~~a mix of fixed maturity investment grade and below investment grade securities as well as various alternative investments, primarily private equity and real estate equity. Although alternative investments are ~~primarily managed by legal entity with dedicated portfolios for certain blocks~~subject to period over period earnings fluctuations, they have historically achieved returns in excess of ~~business. For portfolios that back multiple product groups, investment results are allocated to business segments.~~the fixed maturity portfolio.

The ~~following tables reconcile the consolidated balance sheet asset and liability amounts to GAIA.~~

General Account ~~Investment Assets~~

~~March 31, 2018~~

GAIA
Other⁽¹⁾
Balance Sheet Total
(in millions)
Balance Sheet Captions:
Fixed maturities, available for sale, at fair value $ 43,953
$ (469 ) $ 43,484
Mortgage loans on real estate 11,333
—
11,333
Policy Loans 3,776
—
3,776
Real Estate held for production of income 52
—
52
Other equity investments 1,128
130
1,258
Other invested assets 170
3,891
4,061
Sub-total investments 60,412
3,552
63,964
Trading Securities 12,907
⁽²⁾
2,012
14,919
Total investments 73,319
5,564
78,883
Cash and cash equivalents 4,220
1,871
6,091
Repurchase and funding agreements⁽³⁾
(4,397 ) —
(4,397 )
Total $ 73,142
$ 7,435
$ 80,577

~~(1)~~

~~Assets listed in~~investment portfolio reflects certain differences from the presentation of the U.S. GAAP Consolidated Financial Statements. This presentation is consistent with how we manage the “Other” category principally consist of our loans to affiliates and other miscellaneous assets or liabilities related to GAIA that are reclassified from various balance sheet lines held in portfolios other than the General Account and which are not managed as part of GAIA, including: (i) related accrued income or expense, (ii) certain reclassifications and intercompany adjustments, (iii) certain trading securities that are associated with hedging programs for variable annuity products with guarantee features, (iv) assets and income of AB and (v) for fixed maturities, the reversal of net unrealized gains (losses). The “Other” category is deducted in arriving at GAIA.


~~(2)~~	~~Primarily related to SCS and consists of corporate bonds (83%), U.S. Treasury securities (6%), other government securities (10%) and other trading securities (1%).~~


~~(3)~~	Includes Securities purchased under agreements to resell, Securities sold under agreements to repurchase and Federal Home Loan Bank funding agreements which are reported in policyholders’ account balances.

~~105~~

~~Table of Contents~~

General Account ~~Investment Assets~~

~~December 31, 2017~~

Balance Sheet Captions: GAIA
Other⁽¹⁾

Balance
Sheet Total
(in millions)
Fixed maturities, available for sale, at fair value $ 45,751
$ 1,190
$ 46,941
Mortgage loans on real estate 10,952
—
10,952
Policy loans 3,819
—
3,819
Real estate held for the production of Income 390
—
390
Other equity investments 1,264
128
1,392
Other invested assets 25
4,093
4,118
Subtotal investment assets $ 62,201
$ 5,411
$ 67,612
Trading securities 12,050
⁽²⁾
2,120
14,170
Total investments $ 74,251
$ 7,531
$ 81,782
Cash and cash equivalent 4,539
275
4,814
Repurchase and funding agreements⁽³⁾
(4,382 ) —
(4,382 )
Total $ 74,408
$ 7,806
$ 82,214

~~(1)~~

Assets listed in the “Other” category principally consist of our loans to affiliates and other miscellaneous assets or liabilities related to GAIA that are reclassified from various balance sheet lines held in portfolios other than the General Account and which are not managed as part of GAIA, including: (i) related accrued income or expense, (ii) certain reclassifications and intercompany adjustments, (iii) certain trading securities that are associated with hedging programs for variable annuity products with guarantee features, (iv) assets and income of AB and (v) for fixed maturities, the reversal of net unrealized gains (losses). The “Other” category is deducted in arriving at GAIA.


~~(2)~~	~~Primarily related to SCS and consists of corporate bonds (83%), U.S. Treasury securities (8%), other government securities (8%) and other trading securities (1%).~~


~~(3)~~	Includes Securities purchased under agreements to resell, Securities sold under agreements to repurchase and Federal Home Loan Bank funding agreements which are reported in policyholders’ account balances.

~~106~~

~~Table~~investment portfolio. For further investment information, see Note 3 and Note 4 of ~~Contents~~

the Notes to the Consolidated Financial Statements.

Investment Results of the General Account Investment ~~Assets~~Portfolio

The following table summarizes the General Account investment portfolio results with Non-GAAP Operating Earnings adjustments by asset category for the periods indicated.

This presentation is consistent with how we measure investment performance for management purposes.

126

Three Months Ended, March 31, Year Ended December 31, 2017
2018 2017
Yield Amount Yield Amount
(Dollars in millions)
Fixed Maturities⁽¹⁾:

Investment grade
Income (loss) 3.64 % $ 396
3.67 % $ 374
$ 1,515
Ending assets 42,620
40,970
44,384
Below investment grade
Income (loss) 6.52 % 22
7.32 % 30
113
Ending assets 1,333
1,646
1,367
Mortgages:
Income (loss) 4.18 % 116
4.66 % 116
454
Ending assets 11,333
10,197
10,952
Real Estate Held for Production of Income:
Interest expense and other (1.91 )% (4 ) (1.19 )% (1 ) 2
Ending assets (liabilities) 52
56
390
Other Equity Investments⁽²⁾:

Income (loss) 12.59 % 41
12.76 % 41
169
Ending assets 1,298
1,410
1,289
Policy Loans:
Income (loss) 5.71 % 54
5.76 % 55
221
Ending assets 3,776
3,818
3,819
Cash and Short-term Investments:
Income (loss) 0.71 % 8
0.67 % 6
32
Ending assets 4,220
2,881
4,539
Repurchase and Funding agreements:
Interest expense and other (9 ) (4 ) (21 )
Ending (liabilities) (4,397 ) (3,790 ) (4,382 )
Total Invested Assets:
Income (loss) 4.07 % 624
4.28 % 617
2,485
Ending assets 60,235
57,188
62,358
Trading Securities:
Income (loss) (0.94 )% (29 ) 5.19 % 119
231
Ending assets 12,907
9,689
12,050
Total:
Investment Income (loss) 3.22 % 595
4.42 % 736
2,716

~~107~~

Table of Contents


	Three Months Ended September 30,
	2023				2022
	Yield		Amount (2)		Yield		Amount (2)
	(Dollars in millions)
Fixed Maturities:
Income (loss)	4.27	%	$	788	3.77	%	$	699
Ending assets			73,776				74,565
Mortgages:
Income (loss)	5.12	%	224		3.92	%	148
Ending assets			17,655				15,688
Other Equity Investments: (1)
Income (loss)	5.10	%	44		2.95	%	26
Ending assets			3,389				3,468
Policy Loans:
Income (loss)	5.39	%	55		4.90	%	49
Ending assets			4,089				4,018
Cash and Short-term Investments: (3)
Income (loss)	(2.71)	%	(26)		(2.51)	%	(8)
Ending assets			2,822				563
Repurchase and funding agreements:
Interest expense and other			(132)				(47)
Ending assets (liabilities)			(8,175)				(7,830)
Total Invested Assets:
Income (loss)	4.06	%	953		3.83	%	867
Ending Assets			93,557				90,472
Short Duration Fixed Maturities:
Income (loss)	3.94	%	1		3.41	%	1
Ending assets			62				117
Total:
Investment income (loss)	4.05	%	954		3.83	%	868
Less: investment fees (4)	(0.19)	%	(45)		(0.17)	%	(38)
Investment Income, Net	3.86	%	909		3.66	%	830
Ending Net Assets			$	93,619			$	90,589

127

Table of Contents

Less: investment fees (0.10 )% (18 ) (0.11 )% (18 ) (68 )
Investment Income, Net 3.12 % $ 577
4.31 % $ 718
$ 2,648
Ending Net Assets $ 73,142
$ 66,877
$ 74,408


~~(1)~~	~~Fixed Maturities Investment Grade and Below Investment Grade are based on Moody’s Equivalent ratings.~~


~~(2)~~	~~Includes, as of March 31, 2018 and December 31, 2017, respectively, $170 million, and $25 million of other invested assets.~~


	Nine Months Ended September 30,								Year Ended December 31
	2023				2022				2022
	Yield		Amount (2)		Yield		Amount (2)		Yield		Amount (2)
	(Dollars in millions)
Fixed Maturities:
Income (loss)	4.11	%	$	2,251	3.52	%	$	1,935	3.57	%	$	2,619
Ending assets			73,776				74,565				72,255
Mortgages:
Income (loss)	4.66	%	599		3.87	%	424		3.92	%	587
Ending assets			17,655				15,688				16,481
Other Equity Investments: (1)
Income (loss)	3.40	%	89		7.80	%	188		5.21	%	171
Ending assets			3,389				3,468				3,433
Policy Loans:
Income (loss)	5.21	%	158		5.30	%	160		5.35	%	215
Ending assets			4,089				4,018				4,033
Cash and Short-term Investments: (3)
Income (loss)	(2.88)	%	(66)		(0.83)	%	(12)		(1.44)	%	(24)
Ending assets			2,822				563				1,419
Funding agreements:
Interest expense and other			(326)				(82)				(156)
Ending assets (liabilities)			(8,175)				(7,830)				(8,501)
Total Invested Assets:
Income (loss)	3.92	%	2,706		3.86	%	2,613		3.79	%	3,412
Ending Assets			93,557				90,472				89,120
Short Duration Fixed Maturities:
Income (loss)	3.96	%	2		3.53	%	4		3.62	%	5
Ending assets			62				117				87
Total:
Investment income (loss)	3.92	%	2,708		3.86	%	2,617		3.79	%	3,417
Less: investment fees (4)	(0.18)	%	(123)		(0.15)	%	(101)		(0.15)	%	(138)
Investment Income, Net	3.74	%	2,585		3.71	%	2,516		3.63	%	3,279
Ending Net Assets			$	93,619			$	90,589			$	89,207

_____________

(1)Includes, as of September 30, 2023, September 30, 2022 and December 31, 2022 respectively, $436 million, $370 million and $400 million of other invested assets. Amounts for certain consolidated VIE investments are shown net of associated non-controlling interest.

(2)Amount for fixed maturities and mortgages represents original cost, reduced by repayments, write-downs, adjusted amortization of premiums, accretion of discount and allowances. Cost for equity securities represents original cost reduced by write-downs; cost for other limited partnership interests represents original cost adjusted for equity in earnings and reduced by distributions.

(3)Cash and Short-term net of collateral expense.

(4)Investment fees are inclusive of investment management fees paid to AB.

AFS Fixed Maturities

The fixed maturity portfolio consists largely of investment grade corporate debt securities and includes significant amounts of U.S. government and agency obligations. The ~~limited~~ below investment grade securities in the ~~GAIA~~General Account investment portfolio consist of loans to middle market companies, public high yield securities, bank loans, as well as “fallen ~~angels”~~angels,” originally purchased as investment grade as well as short duration public high yield and loans to middle market companies. At March 31, 2018 and December 31, 2017, respectively, 79.5% and 81.1% of the fixed maturity portfolio was publicly traded.investments.

AFS Fixed Maturities by Industry

The following table sets forth these fixed maturities by industry category ~~as of the dates indicated~~ along with their associated gross unrealized gains and ~~losses.~~

losses:

128

~~108~~

Table of Contents

AFS Fixed Maturities by Industry⁽¹⁾


	Amortized Cost		Allowance for Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Percentage of Total (%)
	(Dollars in millions)
As of September 30, 2023
Corporate Securities:
Finance	$	13,792	$	—	$	8	$	1,861	$	11,939	19	%
Manufacturing	11,458		—		5		2,022		9,441		15	%
Utilities	6,786		1		6		1,199		5,592		9	%
Services	8,339		1		17		1,358		6,997		11	%
Energy	3,836		—		7		673		3,170		5	%
Retail and wholesale	3,419		—		10		494		2,935		5	%
Transportation	2,459		—		4		428		2,035		3	%
Other	132		—		1		18		115		—	%
Total corporate securities	50,221		2		58		8,053		42,224		67	%
U.S. government	5,744		—		—		1,573		4,171		7	%
Residential mortgage-backed (2)	1,791		—		—		136		1,655		3	%
Preferred stock	41		—		2		—		43		—	%
State & political	615		—		2		102		515		1	%
Foreign governments	821		—		1		161		661		1	%
Commercial mortgage-backed	4,051		—		—		680		3,371		5	%
Asset-backed securities (3)	10,466		—		15		212		10,269		16	%
Total	$	73,750	$	2	$	78	$	10,917	$	62,909	100	%

As of December 31, 2022
Corporate Securities:
Finance	$	13,537	$	—	$	9	$	1,682	$	11,864	19	%
Manufacturing	11,797		2		14		1,793		10,016		16	%
Utilities	6,808		—		14		1,063		5,759		9	%
Services	8,299		22		16		1,236		7,057		11	%
Energy	3,740		—		11		574		3,177		5	%
Retail and wholesale	3,394		—		14		433		2,975		5	%
Transportation	2,277		—		8		367		1,918		3	%
Other	124		—		3		15		112		—	%
Total corporate securities	49,976		24		89		7,163		42,878		68	%
U.S. government	7,054		—		1		1,218		5,837		10	%
Residential mortgage-backed (2)	908		—		1		87		822		1	%
Preferred stock	41		—		2		—		43		—	%
State & political	609		—		7		89		527		1	%
Foreign governments	985		—		2		151		836		1	%
Commercial mortgage-backed	3,823		—		—		588		3,235		5	%
Asset-backed securities (3)	8,859		—		4		373		8,490		14	%
Total	$	72,255	$	24	$	106	$	9,669	$	62,668	100	%

______________

(1)Investment data has been classified based on standard industry categorizations for domestic public holdings and similar classifications by industry for all other holdings.

(2)Includes publicly traded agency pass-through securities and collateralized obligations.

(3)Includes credit-tranched securities collateralized by sub-prime mortgages, credit risk transfer securities and other asset types.

129

Amortized
Cost

Gross
Unrealized
Gains

Gross
Unrealized
Losses
Fair Value Percentage of Total (%)
(in millions)
At March 31, 2018:
Corporate Securities:
Finance $ 6,064
$ 113
$ 60
$ 6,117
14 %
Manufacturing 8,026
166
133
8,059
18 %
Utilities 4,206
134
75
4,265
10 %
Services 3,639
78
55
3,662
8 %
Energy 2,084
66
36
2,114
5 %
Retail and wholesale 1,365
20
21
1,364
3 %
Transportation 1,078
36
24
1,090
2 %
Other 145
5
1
149
— %
Total corporate securities 26,607
618
405
26,820
60 %
U.S. government and agency 14,757
387
506
14,638
34 %
Residential mortgage-backed⁽²⁾
614
16
3
627
1 %
Preferred stock 473
44
4
513
1 %
State & municipal 422
56
1
477
1 %
Foreign governments 405
23
9
419
1 %
Asset-backed securities 675
4
4
675
2 %
Total $ 43,953
$ 1,148
$ 932
$ 44,169
100 %
At December 31, 2017
Corporate Securities:
Finance $ 5,824
$ 200
$ 7
$ 6,017
13 %
Manufacturing 7,546
289
15
7,820
17 %
Utilities 4,032
210
13
4,229
9 %
Services 3,307
130
15
3,422
7 %
Energy 1,980
101
9
2,072
4 %
Retail and wholesale 1,404
36
3
1,437
3 %
Transportation 957
58
3
1,012
2 %
Other 128
7
—
135
— %
Total corporate securities 25,178
1,031
65
26,144
55 %
U.S. government and agency 17,744
1,000
251
18,493
39 %
Residential mortgage-backed⁽²⁾
797
22
1
818
2 %
Preferred stock 470
43
1
512
1 %
State & municipal 422
67
—
489
1 %
Foreign governments 395
29
5
419
1 %
Asset-backed securities 745
5
1
749
1 %
Total $ 45,751
$ 2,197
$ 324
$ 47,624
100 %


~~(1)~~	~~Investment data has been classified based on standard industry categorizations for domestic public holdings and similar classifications by industry for all other holdings.~~


~~(2)~~	~~Includes publicly traded agency pass-through securities and collateralized obligations.~~

~~109~~

Table of Contents

Fixed Maturities Credit Quality

The ~~Securities Valuation Office (“SVO”)~~SVO of the NAIC evaluates the investments of insurers for regulatory reporting purposes and assigns fixed ~~maturity securities~~maturities to one of six categories (“NAIC Designations”). NAIC Designations of “1” or “2” include fixed maturities considered investment grade, which include securities rated Baa3 or higher by Moody’s or BBB- or higher by Standard & Poor’s. NAIC Designations of “3” through “6” are referred to as below investment grade, which include securities rated Ba1 or lower by Moody’s and BB+ or lower by Standard & Poor’s. As a result of time lags between the funding of investments and the completion of the SVO filing process, the fixed maturity portfolio typically includes securities that have not yet been rated by the SVO as of each balance sheet date. Pending receipt of SVO ratings, the categorization of these securities by NAIC ~~Designation~~designation is based on the expected ratings indicated by internal analysis.

The amortized cost of the General Accounts’ public and private below investment grade fixed maturities totaled $1.1 billion, or 2.4% of the total fixed maturities at March 31, 2018 and $1.1 billion, or 2.5%, of the total fixed maturities at December 31, 2017. Gross unrealized losses on public and private fixed maturities increased from $324 million in 2017 to $932 million in first quarter of 2018. Below investment grade fixed maturities represented 2.5% and 5.6% of the gross unrealized losses at March 31, 2018 and December 31, 2017, respectively.

~~110~~

~~Table of Contents~~

~~Public Fixed Maturities Credit Quality.~~

~~The~~ following table sets forth the General Account’s ~~public~~ fixed maturities portfolio by NAIC ~~rating at the dates indicated.~~rating:

~~Public~~AFS Fixed Maturities


NAIC Designation	Rating Agency Equivalent	Amortized Cost		Allowance for Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
		(in millions)
As of September 30, 2023
1................................	Aaa, Aa, A	$	46,888	$	—	$	39	$	6,732	$	40,195
2................................	Baa	24,299		—		33		4,047		20,285
	Investment grade	71,187		—		72		10,779		60,480
3................................	Ba	1,428		—		2		98		1,332
4................................	B	1,022		1		3		33		991
5................................	Caa	109		—		1		6		104
6................................	Ca, C	4		1		—		1		2
	Below investment grade	2,563		2		6		138		2,429
Total Fixed Maturities		$	73,750	$	2	$	78	$	10,917	$	62,909

As of December 31, 2022:
1................................	Aaa, Aa, A	$	44,612	$	—	$	56	$	5,652	$	39,016
2................................	Baa	24,843		—		47		3,804		21,086
	Investment grade	69,455		—		103		9,456		60,102
3................................	Ba	1,565		2		1		130		1,434
4................................	B	1,161		20		1		75		1,067
5................................	Caa	64		2		1		7		56
6................................	Ca, C	10		—		—		1		9
	Below investment grade	2,800		24		3		213		2,566
Total Fixed Maturities		$	72,255	$	24	$	106	$	9,669	$	62,668

NAIC Designation⁽¹⁾
Rating Agency Equivalent Amortized Costs Gross Unrealized Gains Gross Unrealized Losses Fair Value

(in millions)
At March 31, 2018:
1 Aaa, Aa, A $ 26,432
$ 713
$ 690
$ 26,455
2 Baa 8,127
288
123
8,292
Investment grade 34,559
1,001
813
34,747

3 Ba 250
1
1
250
4 B 120
—
6
114
5 C and lower 4
—
—
4
6 In or near default 3
—
—
3
Below investment grade 377
1
7
371
Total Public Fixed Maturities $ 34,936
$ 1,002
$ 820
$ 35,118

At December 31, 2017
1 Aaa, Aa, A $ 29,137
$ 1,506
$ 274
$ 30,369
2 Baa 7,521
434
10
7,945
Investment grade 36,658
1,940
284
38,314
3 Ba 304
5
6
303
4 B 119
—
1
118
5 C and lower 3
—
—
3
6 In or near default 9
—
—
9
Below investment grade 435
5
7
433
Total Public Fixed Maturities $ 37,093
$ 1,945
$ 291
$ 38,747


~~(1)~~	Includes, as of March 31, 2018 and December 31, 2017, respectively, two securities with amortized cost of $4 million (fair value of $4 million) and two securities with amortized cost of $14 million (fair value of $14 million) that have been categorized based on expected NAIC designation pending receipt of SVO ratings.

~~111~~

~~Table of Contents~~

~~Private Fixed Maturities Credit Quality.~~Mortgage Loans

The ~~following table sets forth the General Account’s private fixed maturities portfolios by NAIC rating at the dates indicated.~~

~~Private Fixed Maturities~~

NAIC Designation⁽¹⁾
Rating Agency Equivalent Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value
(in millions)
At March 31, 2018:
1 Aaa, Aa, A $ 4,638
$ 71
$ 44
$ 4,665
2 Baa 3,683
71
52
3,702
Investment grade 8,321
142
96
8,367
3 Ba 346
1
6
341
4 B 331
1
10
322
5 C and lower 18
—
—
18
6 In or near default 1
2
—
3
Below investment grade 696
4
16
684
Total Private Fixed Maturities $ 9,017
$ 146
$ 112
$ 9,051

At December 31, 2017:
1 Aaa, Aa, A $ 4,356
$ 122
$ 12
$ 4,466
2 Baa 3,610
123
10
3,723
Investment grade 7,966
245
22
8,189
3 Ba 358
2
4
356
4 B 315
2
7
310
5 C and lower 17
1
—
18
6 In or near default 2
2
—
4
Below investment grade 692
7
11
688
Total Private Fixed Maturities $ 8,658
$ 252
$ 33
$ 8,877


~~(1)~~	Includes, as of March 31, 2018 and December 31, 2017, respectively, 23 securities with amortized cost of $377 million (fair value, $368 million) and 24 securities with amortized cost of $541 million (fair value, $543 million) that have been categorized based on expected NAIC designation pending receipt of SVO ratings.

~~112~~

~~Table~~mortgage portfolio primarily consists of ~~Contents~~

~~Corporate Fixed Maturities Credit Quality.~~

~~The following table sets forth the General Account’s public~~commercial, agricultural, and ~~private holdings of corporate fixed maturities by NAIC rating at the dates indicated.~~

~~Corporate Fixed Maturities~~

NAIC Designation⁽¹⁾
Rating Agency Equivalent Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value
(in millions)
At March 31, 2018:
1 Aaa, Aa, A $ 14,329
$ 300
$ 214
$ 14,415
2 Baa 11,211
313
168
11,356
Investment grade 25,540
613
382
25,771

3 Ba 594
2
8
588
4 B 449
1
15
435
5 C and lower 21
—
—
21
6 In or near default 2
2
—
4
Below investment grade 1,066
5
23
1,048
Total Corporate Fixed Maturities $ 26,606
$ 618
$ 405
$ 26,819

At December 31, 2017:
1 Aaa, Aa, A $ 13,517
$ 508
$ 29
$ 13,996
2 Baa 10,543
510
19
11,034
Investment grade 24,060
1,018
48
25,030
3 Ba 660
7
9
658
4 B 432
3
8
427
5 C and lower 19
—
—
19
6 In or near default 7
3
—
10
Below investment grade 1,118
13
17
1,114
Total Corporate Fixed Maturities $ 25,178
$ 1,031
$ 65
$ 26,144


~~(1)~~	Includes, as of March 31, 2018 and December 31, 2017, respectively, 24 securities with amortized cost of $310 million (fair value, $304 million) and 25 securities with amortized cost of $484 million (fair value, $484 million) that have been categorized based on expected NAIC designation pending receipt of SVO ratings.

~~Asset-backed Securities~~

As of March 31, 2018, the amortized cost and fair value of asset backed securities held were $675 million and $675 million, respectively. As of December 31, 2017, the amortized cost and fair value of asset-backed securities held were $745 million and $749 million, respectively.

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~~Table of Contents~~

~~Commercial Mortgage-backed Securities~~

~~At March 31, 2018 and December 31, 2017 there were no General Account commercial mortgage-backed securities outstanding.~~

~~Mortgages~~

~~Investment Mix~~

~~As of March 31, 2018 and December 31, 2017, respectively, approximately 13.3% and 12.7%, respectively, of invested assets were in commercial and agricultural~~residential mortgage loans. ~~The table below shows the composition of the commercial and agricultural mortgage loan portfolio, before the loss allowance, as of the dates indicated.~~

March 31, 2018 December 31, 2017
(in millions)
Commercial mortgage loans $ 8,755
$ 8,386
Agricultural mortgage loans 2,585
2,574
Total mortgage loans $ 11,340
$ 10,960

The investment strategy for the mortgage loan portfolio emphasizes diversification by property type and geographic location with a primary focus on asset quality. The commercial mortgage loan portfolio is backed by high quality properties located in primary markets typically owned by experienced institutional investors with a demonstrated ability to manage their assets through business cycles. Our commercial loan portfolio is monitored on an ongoing basis, assigning credit quality ratings for each loan, with the particular emphasis on loans that are scheduled to mature in the next 12 to 24 months. Scheduled maturities for the remainder of 2023 and full year 2024, respectively are $306 million and $1.3 billion, or 2% and 8% of the commercial mortgage portfolio. The commercial mortgage portfolio consists of 87% fixed rate loans and 13% floating rate loans. For floating rate loans, the borrower is typically required to purchase an interest rate cap to the scheduled maturity of the loan to protect against rising rates.

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Commercial mortgage loans are evaluated annually to determine a current LTV ratio. Property financial statements, current rent roll, lease maturities, tenant creditworthiness, property physical inspections, and forecasted leasing market strength are used to develop projected cash flows. A discounted cash flow methodology which incorporates market data is used to determine property values. The average LTV ratio at origination provided by a certified appraisal firm was 53%. The average LTV ratio was 62% and 62% at September 30, 2023 and December 31, 2022, respectively, which reflects the most recent opinion of value on the underlying collateral.

Over the past year, we began working with CarVal to establish investment programs in residential whole loans and other private and public securities. These programs allow us to leverage CarVal’s expertise in asset classes where we are looking to increase exposure. The residential mortgage portfolio primarily consists of purchased closed end, amortizing residential mortgage loans. The investment strategy for the mortgage loan portfolio emphasizes high credit quality borrowers, conservative LTV ratios, superior ability to repay and geographic diversification.

Residential mortgage loans are pooled by loan type (i.e., Jumbo, Agency Eligible, Non-Qualified, etc.) and pooled by similar risk profiles (including consumer credit score and LTV ratios). The portfolio is monitored monthly primarily based on payment activity, occurrence of regional natural disasters and borrower interactions with the mortgage servicer.

The tables below show the breakdown of the amortized cost of the General Account’s investments in mortgage loans by geographic region and property ~~type as of the dates indicated.~~type:

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Mortgage Loans by Region and Property Type


	September 30, 2023				December 31, 2022
	Amortized Cost		% of Total		Amortized Cost		% of Total
	(Dollars in millions)
By Region:
U.S. Regions:
Pacific	$	4,916	28	%	$	4,903	30	%
Middle Atlantic	3,654		20		3,529		21
South Atlantic	2,603		15		2,059		12
East North Central	1,015		6		1,087		7
Mountain	1,507		8		1,368		8
West North Central	824		5		826		5
West South Central	1,317		7		1,111		7
New England	857		5		859		5
East South Central	487		3		475		3
Total U.S.	17,180		96		16,217		98
Other Regions:
Europe	684		4		393		2
Total Other	684		4		393		2
Total Mortgage Loans	$	17,864	100	%	$	16,610	100	%

By Property Type:
Office	$	4,762	27	%	$	4,749	29	%
Multifamily	6,357		36		5,657		33
Agricultural loans	2,550		14		2,590		16
Retail	306		2		327		2
Industrial	2,235		13		2,125		13
Hospitality	597		3		427		3
Residential	32		—		—		—
Other	1,025		6		735		4
Total Mortgage Loans	$	17,864	101	%	$	16,610	100	%

131

March 31, 2018 December 31, 2017
Amortized Cost % of Total Amortized Cost % of Total
(Dollars in millions)
By Region:
U.S. Regions:
Pacific $ 3,308
29.2 % $ 3,264
29.8 %
Middle Atlantic 3,108
27.4
2,958
27.0
South Atlantic 1,266
11.2
1,096
10.0
East North Central 929
8.2
917
8.4
Mountain 812
7.1
800
7.3
West North Central 769
6.8
778
7.1
West South Central 507
4.5
499
4.5
New England 459
4.0
460
4.2
East South Central 182
1.6
188
1.7
Total Mortgage Loans $ 11,340
100.0 % $ 10,960
100.0 %
By Property Type:
Office Buildings $ 3,767
33.2 % $ 3,639
33.2 %
Apartment Complexes 3,200
28.2
3,014
27.5
Agricultural properties 2,585
22.8
2,574
23.5
Retail stores 695
6.1
647
5.9
Hospitality 426
3.8
417
3.8
Industrial 325
2.9
326
3.0
Other 342
3.0
343
3.1
Total mortgage loans $ 11,340
100.0 % $ 10,960
100.0 %

As of March 31, 2018 and December 31, 2017, respectively, the General Account investments in commercial mortgage loans had a weighted average loan-to-value ratio of 59% and 59%, respectively, while the agricultural mortgage loans weighted average loan-to-value ratio was 46% and 46%, respectively.

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~~The following tables provide information relating to the loan-to-value~~Liquidity and debt service coverage ratios for commercial and agricultural mortgage loans as of March 31, 2018 and December 31, 2017, respectively. The values used in these ratio calculations were developed as part of the periodic review of the commercial and agricultural mortgage loan portfolio, which includes an evaluation of the underlying collateral value.

~~Mortgage Loans by Loan-to-Value and Debt Service Coverage Ratios~~

~~March 31, 2018~~

Debt Service Coverage Ratio⁽¹⁾

Loan-to-Value Ratio⁽²⁾
Greater
than 2.0x

1.8x to
2.0x

1.5x to
1.8x

1.2x to
1.5x

1.0x to
1.2x

Less
than
1.0x

Total
Mortgage
Loans
(in millions)
0% - 50% $ 1,012
$ 174
$ 597
$ 569
$ 321
$ 29
$ 2,702
50% - 70% 4,588
689
1,341
759
406
48
7,831
70% - 90% 169
110
144
330
27
—
780
90% plus —
—
27
—
—
—
27
Total commercial and agricultural mortgage loans $ 5,769
$ 973
$ 2,109
$ 1,658
$ 754
$ 77
$ 11,340


~~(1)~~	~~The debt service coverage ratio is calculated using actual results from property operations.~~


~~(2)~~	~~The loan-to-value ratio is derived from current loan balance divided by the fair market value of the property. The fair market value of the underlying commercial properties is updated annually.~~

~~December 31, 2017~~

Debt Service Coverage Ratio⁽¹⁾

Loan-to-Value Ratio⁽²⁾
Greater
than 2.0x

1.8x to
2.0x

1.5x to
1.8x

1.2x to
1.5x

1.0x to
1.2x

Less than
1.0x

Total Mortgage
Loans
(in millions)
0% - 50% $ 1,031
$ 149
$ 595
$ 589
$ 316
$ 30
$ 2,710
50% - 70% 4,199
728
1,293
787
366
49
7,422
70% - 90% 169
110
196
276
50
—
801
90% plus —
—
27
—
—
—
27
Total commercial and agricultural mortgage loans $ 5,399
$ 987
$ 2,111
$ 1,652
$ 732
$ 79
$ 10,960


~~(1)~~	~~The debt service coverage ratio is calculated using actual results from property operations.~~


~~(2)~~	~~The loan-to-value ratio is derived from current loan balance divided by the fair market value of the property. The fair market value of the underlying commercial properties is updated annually.~~

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~~Table of Contents~~

~~The tables below show the breakdown of the commercial and agricultural mortgage loans by year of origination at March 31, 2018 and December 31, 2017, respectively.~~

~~Mortgage Loans by Year of Origination~~

March 31, 2018
Year of Origination Amortized Cost % of Total
(in millions)
2018 $ 391
3.5 %
2017 2,043
18.0
2016 3,305
29.1
2015 1,556
13.7
2014 1,174
10.4
2013 and prior 2,871
25.3
Total mortgage loans $ 11,340
100.0 %

December 31, 2017
Year of Origination Amortized Cost % of Total
(in millions)
2017 $ 2,026
18.5 %
2016 3,298
30.1
2015 1,551
14.2
2014 1,170
10.7
2013 1,485
13.5
2012 and prior 1,430
13.0
Total mortgage loans $ 10,960
100.0 %

At March 31, 2018 and December 31, 2017, respectively, $66 million and $49 million of mortgage loans were classified as problem loans while $0 million and $0 million were classified as potential problem loans.

Valuation allowances for the commercial mortgage loan portfolio were related to loan specific reserves. The following table sets forth the change in valuation allowances for the commercial mortgage loan portfolio as of the dates indicated. There were no valuation allowances for agricultural mortgages at March 31, 2018 and March 31, 2017.

~~Commercial Mortgage Loans~~

2018 2017
Allowance for credit losses: (in millions)
Beginning Balance, January 1 $ 8
$ 8
Charge-offs —
—
Recoveries (1 ) —
Provision —
—
Ending Balance, March 31 $ 7
$ 8
Ending Balance, March 31:
Individually Evaluated for Impairment $ 7
$ 8

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~~Table of Contents~~

~~Other Equity Investments~~

At March 31, 2018 and December 31, 2017, private equity partnerships, hedge funds and real-estate related partnerships were 98.8% and 87.5%, respectively of total other equity investments. These interests, which represent 1.5% and 1.3%, respectively of GAIA, consist of a diversified portfolio of LBO mezzanine, venture capital and other alternative limited partnerships, diversified by sponsor, fund and vintage year. The portfolio is actively managed to control risk and generate investment returns over the long term. Portfolio returns are sensitive to overall market developments.

~~Other Equity Investments - Classifications~~

March 31, 2018 December 31, 2017
(in millions)
Common stock $ 13
$ 158
Joint ventures and limited partnerships:
Private equity 963
927
Hedge funds 152
179
Total Other Equity Investments $ 1,128
$ 1,264

~~Derivatives~~

We use derivatives as part of our overall asset/liability risk management primarily to reduce exposures to equity market and interest rate risks. Derivative hedging strategies are designed to reduce these risks from an economic perspective and are all executed within the framework of a Derivative Use Plan (“DUP”) approved by applicable states’ insurance law. Derivatives are generally not accounted for using hedge accounting. Operation of these hedging programs is based on models involving numerous estimates and assumptions, including, among others, mortality, lapse, surrender and withdrawal rates, election rates, fund performance, market volatility and interest rates. A wide range of derivative contracts are used in these hedging programs, including exchange traded equity, currency and interest rate futures contracts, total return swaps on equity, bond and Treasury indices, total return swaps on single U.S. Treasury Securities, interest rate swaps bond and bond-index total return swaps, swaptions, variance swaps, equity options, credit and foreign exchange derivatives, as well as bond and repo transactions to support the hedging.

~~Derivatives used to hedge exposure to variable annuity products with GMxB features~~

We have issued and continue to offer certain variable annuity products with GMxB features. The risk associated with the GMDB feature is that under-performance of the financial markets could result in GMDB benefits, in the event of death, being higher than what accumulated policyholders’ account balances would support. The risk associated with the GMLB features is that under-performance of the financial markets could result in the GMLB features’ benefits being higher than what accumulated policyholders’ account balances would support.

For GMxB features, we retain certain risks including basis, credit spread and some volatility risk and risk associated with actual versus expected actuarial assumptions for mortality, lapse and surrender, withdrawal, policyholder election rates and other behaviors. The derivative contracts are managed to correlate with changes in the value of the GMxB features that result from financial markets movements. A portion of exposure to realized equity volatility is hedged using equity options and variance swaps and a portion of exposure to credit risk is hedged using total return swaps on fixed income indices. Additionally, we are party to total return swaps for which the reference U.S. Treasury securities are contemporaneously purchased from the market and sold to the swap counterparty. As these transactions result in a transfer of control of the U.S. Treasury securities to the swap counterparty, we derecognize these securities with consequent gain or loss from the sale. We have also purchased reinsurance

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~~Table of Contents~~

contracts to mitigate the risks associated with GMDB features and the impact of potential market fluctuations on future policyholder elections of GMIB features contained in certain annuity contracts issued by us.

~~Derivatives used to hedge crediting rate exposure on SCS, SIO, MSO and IUL products/investment options~~

We hedge crediting rates in SCS, SIO in the EQUI-VEST variable annuity product series, MSO in the variable life insurance products and IUL insurance products. These products permit the contract owner to participate in the performance of an index, ETF or commodity price movement up to a cap for a set period of time. They also contain a protection feature, in which we will absorb, up to a certain percentage, the loss of value in an index, ETF or commodity price, which varies by product segment.

In order to support the returns associated with these features, we enter into derivative contracts whose payouts, in combination with fixed income investments, emulate those of the index, ETF or commodity price, subject to caps and buffers.

~~Other derivatives based hedges~~

~~From time to time and depending on market and other conditions we hedge additional risks not otherwise covered by our variable annuity product hedge programs. Such hedge programs include:~~

~~the net duration of our General Account economic liability and assets;~~

~~expected income from fees on Separate Account AUM against declines in equity markets;~~

~~the economic impact of lower interest-rates on expected variable annuity product sales;~~

~~the equity exposure of General Account assets; and~~

~~the credit exposure of General Account assets.~~

~~Derivatives utilized for General Account investment portfolio~~

We maintain a strategy in our General Account investment portfolio to replicate the exposure of fixed maturity securities otherwise permissible for investment under our investment guidelines. Examples include corporate bond exposure replicated through the sale of credit default swaps together with the purchase of a Treasury bond and Treasury bond exposure replicated through the sale of an asset swap and the purchase the bond referenced in the asset swap.

~~These asset swaps, when considered in combination with the bonds, result a yield higher than a term-equivalent U.S. Treasury bond.~~

~~The tables below present quantitative disclosures about our derivative instruments, including those embedded in other contracts required to be accounted for as derivative instruments.~~

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~~Table of Contents~~

~~Derivative Instruments by Category~~

At March 31, 2018
Fair Value Gains (Losses) Reported in Net Earnings (Loss) Three Months Ended March 31, 2018

Notional
Amount

Asset
Derivatives

Liability
Derivatives

(in millions)
Freestanding derivatives
Equity contracts:⁽¹⁾

Futures $ 6,450
$ —
$ —
$ (24 )
Swaps 7,881
253
15
112
Options 23,013
3,350
1,411
(18 )
Interest rate contracts:⁽¹⁾

Floors —
—
—
—
Swaps 29,281
555
394
(672 )
Futures 24,015
—
—
40
Swaptions —
—
—
—
Credit contracts:⁽¹⁾

Credit default swaps 2,057
30
1
—
Other freestanding contracts:⁽¹⁾

Foreign currency contracts 1,623
1
44
(51 )
Margin
59
57

Collateral
16
2,207

Embedded derivatives:
GMIB reinsurance contracts⁽⁴⁾
—
1,734
—
(161 )
GMxB derivative features liability^(2,4)
—
—
3,977
(460 )
SCS, SIO, MSO and IUL indexed features^(3,4)
—
—
1,683
(279 )
Total $ 94,320
$ 5,998
$ 9,789
$ (1,513 )


~~(1)~~	~~Reported in Other invested assets in the consolidated balance sheets.~~


~~(2)~~	~~Reported in Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets.~~


~~(3)~~	SCS and SIO indexed features are reported in Policyholders’ account balances; MSO and IUL indexed features are reported in the Future policyholders’ benefits and other policyholders’ liabilities in the consolidated balance sheets.


~~(4)~~	~~Reported in Net derivative gains (losses) in the consolidated statements of income (loss).~~

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~~Table of Contents~~

~~Derivative Instruments by Category~~

At December 31, 2017
Gains (Losses) Reported in Net Earnings (Loss)
March 31, 2017
Fair Value
Notional
Amount   Asset
Derivatives   Liability
Derivatives
(in millions)
Freestanding derivatives
Equity contracts:⁽¹⁾

Futures $ 6,552
$ —
$ —
$ (391 )
Swaps 7,555
3
200
(403 )
Options 22,223
3,456
1,457
318
Interest rate contracts:⁽¹⁾

Floors —
—
—
—
Swaps 26,725
603
192
143
Futures 20,675
—
—
(19 )
Credit contracts:⁽¹⁾

Credit default swaps 2,057
34
2
6
Other freestanding contracts:⁽¹⁾

Foreign currency contracts 1,297
11
2
—
Margin —
18
4
—
Collateral —
4
2,123
—
Embedded derivatives:
GMIB reinsurance contracts⁽⁴⁾
—
1,894
—
(514 )
GMxB derivative features liability^(2,4)
—
—
4,358
(58 )
SCS, SIO, MSO and IUL indexed features^(3,4)
—
—
1,786
(301 )
Total $ 87,084
$ 6,023
$ 10,124
$ (1,219 )


~~(1)~~	~~Reported in Other invested assets in the consolidated balance sheets.~~


~~(2)~~	~~Reported in Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets.~~


~~(3)~~	SCS and SIO indexed features are reported in Policyholders’ account balances; MSO and IUL indexed features are reported in the Future policyholders’ benefits and other policyholders’ liabilities in the consolidated balance sheets.


~~(4)~~	~~Reported in Net derivative gains (losses) in the consolidated statements of income (loss).~~

~~Realized Investment Gains (Losses)~~

Realized investment gains (losses) are generated from numerous sources, including the sale of fixed maturity securities, equity securities, investments in limited partnerships and other types of investments, as well as adjustments to the cost basis of investments for OTTI. Realized investment gains (losses) are also generated from prepayment premiums received on private fixed maturity securities, recoveries of principal on previously impaired securities, provisions for losses on commercial mortgage and other loans, fair value changes on commercial mortgage loans carried at fair value, and fair value changes on embedded derivatives and free-standing derivatives that do not qualify for hedge accounting treatment.

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~~Table of Contents~~

~~The following table sets forth “Realized investment gains (losses), net,” for the periods indicated:~~

~~Realized Investment Gains (Losses), Net~~

Three Months Ended March 31,
2018 2017
(in millions)
Fixed maturities $ 109
$ (6 )
Other equity investments —
4
Other —
—
Total $ 109
$ (2 )

~~The following table further describes realized gains (losses), net for Fixed maturities for the periods indicated:~~

~~Fixed Maturities~~

~~Realized Investment Gains (Losses)~~

Three Months Ended March 31,
2018 2017
(in millions)
Gross realized investment gains:
Gross gains on sales and maturities $ 161
$ 20
Other —
—
Total gross realized investment gains 161
20
Gross realized investment losses:
Other-than-temporary impairments recognized in income (loss) —
—
Gross losses on sales and maturities (52 ) (26 )
Total gross realized investment losses (52 ) (26 )
Total $ 109
$ (6 )

~~Other-Than-Temporary Impairments Recorded in Earnings (Losses)~~

~~At March 31, 2018 and 2017, there were no General Account other-than-temporary impairments recorded in Income (Loss).~~

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~~LIQUIDITY AND CAPITAL RESOURCES~~Capital Resources

Liquidity refers to our ability to generate adequate amounts of cash from our operating, investment and financing activities to meet our cash requirements with a prudent margin of safety. Capital refers to our long-term financial resources available to support business operations and future growth. Our ability to generate and maintain sufficient liquidity and capital is dependent on the profitability of our businesses, timing of cash flows related to our investments and products, our ability to access the capital markets, general economic conditions and the alternative sources of liquidity and capital described herein. When considering our liquidity and cash flows, ~~it is important to~~we distinguish between the needs of Holdings and the needs of our insurance and non-insurance subsidiaries. We also distinguish and separately manage the liquidity and capital resources of our retirement and protection businesses ~~including our~~(our Individual Retirement, Group Retirement, ~~and~~ Protection Solutions ~~segments,~~and Legacy segments) and our Investment Management and Research ~~segment.~~and Wealth Management segments.

Sources and Uses of Liquidity ~~and Capital Position~~

The Company has sufficient cash flows from operations to satisfy liquidity requirements in 2023.

Cash Flows of Holdings

As a holding company with no business operations of its own, Holdings primarily derives cash flows from dividends ~~and interest payments~~ from its ~~insurance~~ subsidiaries and distributions related to its economic interest in AB, ~~more than half~~all of which is currently held outside our insurance company ~~subsidiaries, after giving effect to the AB Reorganization Transactions.~~subsidiaries. These principal sources of liquidity are augmented by cash and short-term investments held by Holdings and access to bank lines of credit and the capital markets. The main uses of liquidity for Holdings are interest payments and debt repayment, payment of dividends and other distributions to stockholders ~~which~~(which may include stock ~~repurchases,~~repurchases) loans and capital contributions, if needed, to our insurance subsidiaries. Our principal sources of liquidity and our capital position are described in the following paragraphs.

~~Historical~~

Sources and Uses of Holding Company Highly Liquid Assets

The following table sets forth Holdings’ principal sources and uses of highly liquid assets:


	Nine Months Ended September 30,
	2023		2022
	(in millions)
Highly Liquid Assets, beginning of period	$	1,992	$	1,742
Dividends from subsidiaries	2,087		1,574



Capital contributions to subsidiaries	(1,050)		(150)
M&A Activity	—		—


Total Business Capital Activity	1,037		1,424

Purchase of treasury shares	(678)		(699)

Shareholder dividends paid	(227)		(220)
Total Share Repurchases, Dividends and Acquisition Activity	(905)		(919)
Issuance of preferred stock	—		—
Preferred stock dividend	(54)		(54)
Total Preferred Stock Activity	(54)		(54)

Issuance of long-term debt	500		—
Repayment of long-term debt	(520)		—
Total External Debt Activity	(20)		—


Proceeds from loans from affiliates	—		—


Net decrease (increase) in existing facilities to affiliates (1)	90		65
Total Affiliated Debt Activity	90		65

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Table of Contents


	Nine Months Ended September 30,
	2023		2022
	(in millions)

Interest paid on external debt and P-Caps	(130)		(116)
Others, net	35		89
Total Other Activity	(95)		(27)

Net increase (decrease) in highly liquid assets	53		489
Highly Liquid Assets, end of period	$	2,045	$	2,231

_______________

(1) Represents net activity of draws and repayments of existing credit facilities between Holdings and affiliates.

Capital Contribution to Our Subsidiaries

During the nine months ended September 30, 2023, Holdings made cash capital contributions of $1.1 billion to Equitable America to support the Reinsurance Treaty. This transaction moved 50% of the account value from Equitable Life to Equitable America. This capital contribution enabled the Company to move capital to match the liabilities moved and maintain an RBC ratio above 400%.

Loans from Our Subsidiaries

There were no loans from our subsidiaries during the nine months ended September 30, 2023.

Cash Distributions from Our Subsidiaries

~~From 2014 to 2016,~~During the nine months ended September 30, 2023, Holdings ~~and AXA Financial~~ received net distributions from our subsidiaries of $2.6 billion. These net distributions comprised dividends and principal payments on surplus notes from our insurance subsidiaries ($1.2 billion, $1.0 billion and $1.1 billion in 2014, 2015 and 2016, respectively),cash distributions from AB ~~($70~~of $292 million ~~$72 million and $85 million in 2014, 2015 and 2016, respectively)~~ and distributions from ~~AXA Advisors ($30 million, $30~~EFIM of $57 million, and $33 million in 2014, 2015 and 2016, respectively), partially offset by a contribution by AXA Financial to AXA RE Arizona to enhance its balance sheet and liquidity position. In addition, AXA Financial also received dividendsEIM of $85 million in 2015 related to certain real estate assets. During this period, we also received $1.9 billion of net proceeds from the sale of certain real estate assets by AXA Financial. In 2017, in accordance with our agreement with the New York State Department of Financial Services (the “NYDFS”) and in preparation for the IPO, Holdings and AXA Financial collectively made $2.3 billion in aggregate capital contributions to AXA Equitable Life and AXA RE Arizona, and AXA Financial received a $124 million distribution on the AB Units held by it and a $74 million distribution from AXA Advisors and U.S. Financial Life Insurance Company.million.

Distributions from Insurance Subsidiaries

Our insurance companies are subject to limitations on the payment of dividends and other transfers of funds to Holdings and other affiliates under applicable insurance law and regulation. Also, more generally, the ability of our insurance subsidiaries to pay dividends can be affected by market conditions and other factors beyond our control.

Under New ~~York~~York’s insurance ~~law~~laws, which are applicable to ~~AXA~~ Equitable ~~Life,~~Financial, a domestic stock life insurer may not, without prior approval of the NYDFS, pay ~~a dividend to its stockholders exceeding~~ an amount calculated under one of two standards. The first standard allows payment of an ordinary dividend out of the insurer’s earned surplus (as reported on the insurer’s most recent annual statement) up to a limit calculated pursuant to a statutory formula, provided that the NYDFS is given notice and opportunity to disapprove the dividend if certain qualitative tests are not met (the “Earned Surplus Standard”). The second standard allows payment of an ordinary dividend up to a limit calculated pursuant to a different statutory formula without regard to the insurer’s earned surplus (the “Alternative Standard”).Ordinary Dividend. Extraordinary Dividends ~~exceeding these prescribed limits~~ require the insurer to file a notice of its intent to declare the dividends with the NYDFS and obtain prior approval or non-disapproval from the NYDFS.

Due to a permitted statutory accounting practice agreed to with the NYDFS, Equitable Financial will need the prior approval of the NYDFS to pay a Permitted Practice Ordinary Dividend. Applying the ~~formulas under these standards and the definition of earned surplus used in the Earned Surplus Standard, AXA~~formula above, Equitable ~~Life~~Financial could pay ~~ordinary dividends~~an Ordinary Dividend of up to approximately ~~$1.2~~$1.7 billion in 2023. Holdings received a cash dividend distribution from Equitable Financial of $1.1 billion during ~~2018 and could have paid ordinary dividends of up~~May 2023 to ~~approximately $1.2 billion during 2017. However, in 2016,~~support the ~~NYDFS issued a circular letter to its regulated insurance companies stating that ordinary dividends which exceed an insurer’s positive unassigned funds (as reported on the~~

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~~insurer’s most recent annual statement) may fail one~~Reinsurance Treaty. This transaction moved 50% of the ~~qualitative tests imposed by the Earned Surplus Standard. Given the circular letter, it is possible that the NYDFS could limit the amount of ordinary dividends declared by AXA~~account value from Equitable Life ~~under~~to Equitable America. This capital contribution enabled the ~~Earned Surplus Standard~~Company to move capital to match the ~~amount~~liabilities moved and maintain an RBC ratio above 400%. Holdings also received a dividend distribution from Equitable Financial of AXA Equitable Life’s positive unassigned funds. As of December 31, 2017 and December 31, 2016, AXA Equitable Life’s unassigned funds reported on its statutory financial statements were approximately $1.9 billion and $0.9 billion, respectively.$600 million during July 2023.

In the second quarter of 2017, AXA Equitable Life agreed with the NYDFS that until it (i) filed a plan with respect to the management of our variable annuity business ceded to AXA RE Arizona with the NYDFS and (ii) fully implement that plan (the “DFS Conditions”), it would pay ordinary dividends only under the Earned Surplus Standard.

The completion of the unwind of the reinsurance provided to AXA Equitable Life by AXA RE Arizona for certain variable annuities with GMxB features (the “GMxB Unwind”), which occurred on April 12, 2018, satisfied the DFS Conditions, and, going forward, satisfaction of either the Earned Surplus Standard or Alternative Standard will determine AXA Equitable Life’s ability to pay ordinary dividends. Our other insurance subsidiaries that reside outside of New York are subject to legal restrictions on dividends similar to those described above under New York law, though the specifics of such rules vary from state to state.

Distributions from AllianceBernstein

ABLP is required to distribute all of its Available Cash Flow, as defined in the Amended and Restated Partnership Agreement of ABLP, to the holders of AB Units and to the General Partner. Available Cash Flow ~~can be summarized~~is defined as the cash flow received by ABLP from operations minus such amounts as the General Partner determines, in its sole discretion, should be retained by ABLP for use in its business, or plus such amounts as the General Partner determines, in its sole discretion, should be released from previously retained cash flow. Distributions by ABLP are made 1% to the General Partner and 99% among the limited partners.

Typically, Available Cash Flow has been the adjusted diluted net income per unit for the quarter multiplied by the number of general and limited partnership interests at the end of the quarter. In future periods, management of AB anticipates that Available Cash Flow will be based on adjusted diluted net income per unit, unless management of AB determines, with the

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concurrence of the Board of Directors of AB, that one or more adjustments that are made for adjusted net income should not be made with respect to the Available Cash Flow calculation.

AB Holding is required to distribute all of its Available Cash Flow, as defined in the Amended and Restated Agreement of Limited Partnership of AB Holding, to holders of ~~units representing assignments of beneficial ownership of limited partnership interests in~~ AB Holding ~~(“AB Holding Units”)~~Units pro rata in accordance with their percentage ~~interests~~interest in AB Holding. Available Cash Flow is defined as the cash distributions AB Holding receives from ABLP minus such amounts as the General Partner determines, in its sole discretion, should be retained by AB Holding for use in its business (such as the payment of taxes) or plus such amounts as the General Partner determines, in its sole discretion, should be released from previously retained cash flow. AB Holding is dependent on the quarterly cash distributions it receives from ABLP, which is subject to the performance of capital markets and other factors beyond our control. Distributions from AB Holding are made pro rata based on the holder’s percentage ownership interest in AB Holding.

~~Following the AB Reorganization Transactions,~~As of September 30, 2023, Holdings and its non-insurance company subsidiaries ~~now~~ hold ~~93.1~~approximately 170.1 million AB Units, ~~and 2.3 million AB Holding Units directly, while 77 million AB Units, 1.4~~4.1 million AB Holding Units and the 1% General Partnership interest in AB are now held by AXA Equitable Life and MLOA, two of our insurance company subsidiaries. Because AXA Equitable Life and MLOA are subject to regulatory restrictions on dividends, distributions they receive from AB may not be distributable to Holdings.ABLP.

As of ~~March 31, 2018,~~September 30, 2023, the ownership structure of ABLP, including AB Units outstanding as well as the general partner’s 1% interest, was as follows:



~~AXA~~Owner	Percentage Ownership
EQH and its subsidiaries	~~63.0~~60.3	%
AB Holding	~~35.8~~39.0	%
Unaffiliated holders	~~1.2~~0.7	%
Total	100.0	%

Including both the general partnership and limited partnership interests in AB Holding and ABLP, ~~AXA~~Holdings and its subsidiaries had an approximate ~~64.4%~~62% economic interest in AB as of September 30, 2023. The issuance of AB Units relating to the CarVal acquisition is not expected to have a significant impact on the Company’s cash flows.

Holdings Credit Facilities

On June 24, 2021, Holdings entered into the Amended and Restated Revolving Credit Agreement with respect to a five-year senior unsecured revolving credit facility (the “Credit Facility”), which lowered the facility amount to $1.5 billion and extended the maturity date to June 24, 2026, among other changes. The Amended and Restated Revolving Credit Agreement amends the Revolving Credit Agreement entered into by Holdings on February 16, 2018, as amended on March ~~31,~~22, 2021.

The Credit Facility may provide significant support to our liquidity position when alternative sources of credit are limited. In addition to the Credit Facility, we have letter of credit facilities with an aggregate principal amount of approximately $1.9 billion (the “LOC Facilities”), primarily to be used to support our life insurance business reinsured to EQ AZ Life Re in April 2018. In June 2021, Holdings entered into amendments with each of the issuers of its bilateral letter of credit facilities to effect changes similar to those effected in the Amended and Restated Revolving Credit Agreement. The respective facility limits of the bilateral letter of credit facilities remained unchanged. On May 12, 2023, the Company entered into an amendment to the Credit Facility and LOC Facilities to replace remaining LIBOR-based benchmark rates with SOFR-based benchmark rates and to make certain other conforming changes.

The Credit Facility and LOC Facilities contain certain administrative, reporting, legal and financial covenants, including requirements to maintain a specified minimum consolidated net worth and to maintain a ratio of indebtedness to total capitalization not in excess of a specified percentage, and limitations on the dollar amount of indebtedness that may be incurred by our subsidiaries and the dollar amount of secured indebtedness that may be incurred by us, which could restrict our operations and use of funds. The right to borrow funds under the Credit Facility and LOC Facilities is subject to the fulfillment of certain conditions, including compliance with all covenants, and the ability to borrow thereunder is also subject to the continued ability of the lenders that are or will be parties to the facilities to provide funds. As of September 30, 2023, we were in compliance with these covenants.

Contingent Funding Arrangements

For information regarding activity pertaining to our contingent funding arrangements and other off-balance sheet commitments, see “Commitments and Contingent Liabilities” in Note 16 of the Notes to the Consolidated Financial Statements in this Form 10-Q.

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Series A Preferred Stock, Series B Preferred Stock and Series C Preferred Stock

For information pertaining to our Series A Preferred Stock, Series B Preferred Stock and Series C Preferred Stock see Note 13 of the Notes to the Consolidated Financial Statements.

Capital Position ~~Following the IPO~~of Holdings

We manage our capital position to maintain financial strength and credit ratings that facilitate the distribution of our products and provide our desired level of access to the bank and ~~public financing~~capital markets. Our capital position is supported by the ability of our subsidiaries to generate cash flows and distribute cash to us and our ability to effectively manage the risk of our businesses and to borrow funds and raise capital to meet our operating and growth needs.

We have historically operated with a capital structure that reflected our status as a wholly owned subsidiary of AXA, including relying on financing provided or guaranteed by AXA and its affiliates. To meet our target capitalization following the IPO, we have taken certain significant actions that have impacted our liquidity and capital position and that align our capital structure more closely with other U.S. public companies. These actions include:

issuing debt securities to third party investors: (i) $800 million aggregate principal amount of 3.900% Senior Notes due 2023, (ii) $1.5 billion aggregate principal amount of 4.350% Senior Notes due 2028 and (iii) $1.5 billion aggregate principal amount of 5.000% Senior Notes due 2048, to replace intercompany financing that is provided or guaranteed by AXA and its affiliates, among other things;

arranging additional contingent financing facilities, including (i) letter of credit facilities with an aggregate principal amount of $1.9 billion, primarily to be used to support our life insurance business reinsured to EQ AZ Life Re following the GMxB Unwind, (ii) a five-year senior unsecured revolving credit facility for an amount of approximately $2.5 billion, and (iii) a three-year senior unsecured term loan facility of up to $500 million;

~~borrowing $300 million under our three-year term loan agreement;~~

~~terminating the outstanding balance issued under AXA Financial’s commercial paper program;~~

~~(i) a capital contribution of $318 million and (ii) the $622 million loan from AXA, which was set off against AXA’s payment obligation to Holdings with respect to the sale of AXA CS shares;~~

~~increasing the statutory capital and reserves of our retirement and protection businesses by approximately $2.3 billion in 2017;~~

selling AXA Equitable Life’s interest in two real estate joint ventures to AXA France for a total purchase price of $143 million, which resulted in the elimination of $203 million of long-term debt on Holdings’ consolidated balance sheet for the first quarter of 2018 and a corresponding reduction of our debt-to-capital ratio; and

~~implementing the Reorganization Transactions (as defined in the Prospectus) which included the direct or indirect acquisition of an additional 18.7% economic interest in AB and the GMxB Unwind.~~

~~Waiver Letter Agreements~~

In April 2018, we entered into waiver letter agreements with the lenders under each of our credit facilities and the letter of credit facilities, pursuant to which the lenders waived certain defaults or events of default under such facilities resulting from the restatement of our annual financial statements for the year ended December 31, 2016, the restatement of our interim financial statements for the nine months ended September 30, 2017 and for the six months ended June 30, 2017, the failure to furnish audited financial statements for the year ended December 31, 2017 on a timely basis as required by such facilities and related matters. There can be no assurance that our lenders will provide such waivers in the future. For a discussion of the restatement to our 2016 annual financial statements, see Note 1 to the Notes to Consolidated Financial Statements included in the Prospectus.

~~Capital Management~~

Prior to the IPO, as a wholly owned subsidiary of AXA, we adopted and abided by capital management policies determined by AXA and managed by AXA on a worldwide basis. Following the IPO, our board of directors (the “Board”)Our Board and senior management are directly involved in the development of our capital management policies. Accordingly, capital actions, including proposed changes to the annual capital plan, capital targets and capital policies, are approved by the Board.

Dividends Declared and Paid

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future dividends is subject to the discretion of our Board of Directors and depends on our financial condition, results of operations, cash requirements, future prospects, regulatory restrictions on the payment of dividends by Holdings’ insurance subsidiaries and other factors deemed relevant by the Board.

The payment of dividends will be substantially restricted in the event that we do not declare and pay (or set aside) dividends on the Series A , Series B and Series C Preferred Stock for the last proceeding dividend period. For additional information on our preferred stock, see “—Series A Preferred Stock, Series B Preferred Stock and Series C Preferred Stock”.

For information regarding activity pertaining to common and preferred dividends declared and paid, see Note 13 of the Notes to the Consolidated Financial Statements.

Share Repurchase Programs

For information regarding activity pertaining to share repurchase programs, see Note 13 of the Notes to the Consolidated Financial Statements.

Sources and Uses of Liquidity of Our Insurance Subsidiaries

The principal sources of liquidity for our insurance subsidiaries are premiums, investment and fee income, deposits associated with our insurance and annuity operations, cash and invested assets, as well as internal borrowings. The principal uses of that liquidity include benefits, claims and dividends paid to policyholders and payments to policyholders in connection with surrenders and withdrawals. Other uses of liquidity include commissions, general and administrative expenses, purchases of investments, the payment of dividends to Holdings and hedging activity. Certain of our insurance subsidiaries’ principal sources and uses of liquidity are described in the paragraphs that follow.

We manage the liquidity of our insurance subsidiaries with the objective of ensuring that they ~~are able to~~can meet payment obligations linked to our Individual Retirement, Group Retirement and Protection Solutions businesses and to their outstanding debt and derivative positions, including in our hedging programs, without support from Holdings. We employ an asset/liability management approach specific to the requirements of each of our insurance businesses. We measure liquidity against internally-developed benchmarks that consider the characteristics of our asset portfolio and the liabilities that it ~~supports.~~supports in both the short-term (the next 12 months) and long-term (beyond the next 12 months). We consider attributes of the various categories of our liquid assets (for example, type of asset and credit quality) in calculating internal liquidity indicators for our insurance and reinsurance operations. Our liquidity benchmarks are established for various stress scenarios and durations, including company-specific and market-wide events. The scenarios we use to evaluate the liquidity of our subsidiaries are defined to allow operating entities to operate without support from Holdings.

Liquid Assets

The investment portfolios of our insurance subsidiaries are a significant component of our overall liquidity. Liquid assets include cash and cash equivalents, short-term investments, U.S. Treasury fixed maturities, fixed maturities that are not designated as ~~held-to-maturity~~HTM and public equity securities. We believe that our business operations and the liquidity profile of our assets provide sufficient liquidity under reasonably foreseeable stress scenarios for each of our insurance subsidiaries.

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See “—General Account Investment ~~Assets~~ Portfolio” and Note 3 and Note 4 of the Notes to the Consolidated Financial Statements for a description of our retirement and protection businesses’ portfolio of liquid assets.

Hedging Activities

Because the future claims exposure on our insurance products, and in particular our variable annuity products with GMxB features, is sensitive to movements in the equity markets and interest rates, we have in place various hedging and reinsurance programs that are designed to mitigate the economic risks of movements in the equity markets and interest rates. We use derivatives as part of our overall asset/liability risk management program primarily to reduce exposures to equity market and interest rate risks. In addition, we use credit derivatives to replicate exposure to individual securities or pools of securities as a means of achieving credit exposure similar to bonds of the underlying issuer(s) more efficiently. The derivative contracts are an integral part of our risk management program, especially for the management of our variable annuities program, and are collectively managed to reduce the economic impact of unfavorable movements in capital markets. These derivative transactions require liquidity to meet payment obligations such as payments for periodic settlements, purchases, maturities and terminations as well as liquid assets pledged as collateral related to any decline in the net estimated fair value. Collateral calls represent one of our biggest drivers for liquidity needs for our insurance subsidiaries. Historically, we have managed our liquidity needs related to our derivative portfolio at AXA Financial and AXA RE Arizona on a combined basis. Due to the limited size of the AXA RE Arizona investment portfolio, we have historically supported its collateral funding needs through AXA Financial’s commercial paper program. Following the GMxB Unwind, which was effected on April 12, 2018, ourOur derivatives contracts reside primarily within ~~AXA~~ Equitable ~~Life. As AXA Equitable Life~~Financial, which has a significantly ~~larger~~large investment ~~portfolio than AXA RE Arizona had, we anticipate a reduced need for overall liquidity going forward.~~portfolio.

FHLB Membership

~~AXA~~ Equitable ~~Life is a member~~Financial and Equitable America are members of the ~~Federal Home Loan Bank of New York (“FHLBNY”),~~FHLB, which provides ~~AXA Equitable Life with~~ access to collateralized borrowings and other ~~FHLBNY~~FHLB products. ~~At March 31, 2018, we had $500 million~~

See Note 16 of ~~outstanding short-term~~the Notes to the Consolidated Financial Statements for further description of our FHLB program.

FABN

Under the FABN program, Equitable Financial may issue funding agreements in U.S. dollar or other foreign currencies.

See Note 16 of the Notes to the Consolidated Financial Statements for further description of our FABN program.

FABCP

Under the FABCP program, Equitable Financial and ~~$2.5 billion of long-term outstanding~~Equitable America may issue funding agreements ~~issued~~in U.S. dollars to the ~~FHLBNY and had posted $4.5 billion securities as collateral for funding agreements. In addition, AXA Equitable Life implemented a hedge~~SPLLC.

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~~to lock in the funding agreements borrowing rate, and $13 million of hedge impact was reported as funding agreement carrying value. MLOA also became a member~~See Note 16 of the ~~Federal Home Loan Bank~~Notes to the Consolidated Financial Statements for further description of ~~San Francisco in February 2018.~~our FABCP program.

Sources and Uses of Liquidity of our Investment Management and Research Segment

The principal sources of liquidity for our Investment Management and Research business include investment management fees and borrowings under its ~~revolving~~ credit ~~facility~~facilities and commercial paper program. The principal uses of liquidity include general and administrative expenses, business financing and distributions to holders of AB Units and AB Holding Units plus interest and debt service. The primary liquidity risk for our fee-based Investment Management and Research business is its profitability, which is impacted by market conditions and our investment management performance.

AB Commercial Paper

As of September 30, 2023 and December 31, 2022, AB had no commercial paper outstanding. The commercial paper is short term in nature, and as such, recorded value is estimated to approximate fair value (and considered a Level 2 security in the fair value hierarchy). Average daily borrowings for the commercial paper outstanding during the third quarter 2023 and full year 2022 were $277 million and $190 million, respectively, with weighted average interest rates of approximately 5.1% and 1.5%, respectively.

AB Credit Facility

AB has ~~a $1.0 billion~~an $800 million committed, unsecured senior revolving credit facility (the “AB Credit Facility”) with a group of commercial banks and other lenders which matures on October ~~22, 2019.~~13, 2026. The Credit Facility was amended and restated on February 9, 2023, to reflect the transition from US LIBOR, which was retired as of June 30, 2023, to the term Secured Overnight Financial Rate ("SOFR”). Other than this immaterial change, there were no other significant changes included in the amendment. The credit facility provides for possible increases in the principal amount by up to an aggregate incremental

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amount of ~~$250~~$200 million. Any such increase is subject to the consent of the affected lenders. The AB Credit Facility is available for AB and SCB LLC for business purposes, including the support of AB’s ~~$1.0 billion~~ commercial paper program. Both AB and SCB LLC can draw directly under the AB Credit Facility and AB management expects to draw on the AB Credit Facility from time to time. AB has agreed to guarantee the obligations of SCB LLC under the AB Credit Facility.

The AB Credit Facility contains affirmative, negative and financial covenants, which are customary for facilities of this type, including, among other things, restrictions on dispositions of assets, restrictions on liens, a minimum interest coverage ratio and a maximum leverage ratio. As of ~~March 31, 2018,~~September 30, 2023, AB was in compliance with these covenants. The AB Credit Facility also includes customary events of default (with customary grace periods, as applicable), including provisions under which, upon the occurrence of an event of default, all outstanding loans may be accelerated and/or lender’s commitments may be terminated. Also, under such provisions, upon the occurrence of certain insolvency- or bankruptcy-related events of default, all amounts payable under the AB Credit Facility would automatically become immediately due and payable, and the lender’s commitments would automatically terminate.

Amounts under the Credit Facility may be borrowed, repaid and re-borrowed by us from time to time until the maturity of the facility. Voluntary pre-payments and commitment reductions requested by AB are permitted at any time without a fee (other than customary breakage costs relating to the pre-payment of any drawn loans) upon proper notice and subject to a minimum dollar requirement. Borrowings under the AB Credit Facility bear interest at a rate per annum, which will be, at AB’s option, a rate equal to an applicable margin, which is subject to adjustment based on the credit ratings of AB, plus one of the following indices: SOFR; a Prime rate; or the Federal Funds rate.

As of ~~March 31, 2018~~September 30, 2023 and December 31, ~~2017,~~2022, AB ~~and SCB LLC~~ had no amounts outstanding under the AB Credit Facility. During the ~~first three~~nine months ~~of 2018~~ended September 30, 2023 and the full year ~~2017,~~2022, AB and SCB LLC did not draw upon the AB Credit Facility.

AB has a $200 million, unsecured 364-day senior revolving credit facility (the “AB Revolver”) with a leading international bank and the other lending institutions that may be party thereto. The AB Revolver is available for AB’s and SCB LLC’s business purposes, including the provision of additional liquidity to meet funding requirements primarily related to SCB LLC’s operations. Both AB and SCB LLC can draw directly under the AB Revolver and management expects to draw on the AB Revolver from time to time. AB has agreed to guarantee the obligations of SCB LLC under the AB Revolver. The AB Revolver contains affirmative, negative and financial covenants that are identical to those of the AB Credit Facility. As of March 31, 2018, AB had no amounts outstanding under the AB Revolver. As of December 31, 2017, AB had $75 million outstanding under the AB Revolver. Average daily borrowing of the AB Revolver during the first three months of 2018 and full year 2017 were $22 million and $21 million, respectively, with weighted average interest rates of approximately 2.4% and 2.0%, respectively.

In addition, SCB LLC ~~also~~currently has ~~three~~five uncommitted lines of credit with ~~three~~five financial institutions. ~~Two~~Four of these lines of credit permit ~~us to borrow~~borrowing up to an aggregate of ~~$175~~approximately $315 million, with AB named as an additional borrower, while the other line has no stated limit. AB has agreed to guarantee the obligations on SCB LLC under these lines of credit. As of ~~March 31, 2018~~September 30, 2023 and December 31, ~~2017,~~2022, SCB LLC had no ~~bank loans outstanding.~~outstanding balance on these lines of credit. Average daily borrowings ~~of bank loans~~ during ~~first three~~the nine months ~~of 2018~~ended September 30, 2023 and the full year ~~2017~~2022 were $3$2 million and $5$1 million ~~respectively~~ with weighted average interest rates of approximately ~~1.5%~~7.8% and ~~1.4%~~3.7%, respectively.

~~Consolidated Cash Flows Analysis~~

~~We believe that cash flows~~EQH Facility

AB has a $900 million committed, unsecured senior credit facility (the “EQH Facility”). The EQH Facility matures on November 4, 2024 and is available for AB’s general business purposes. Borrowings under the EQH Facility generally bear interest at a rate per annum based on prevailing overnight commercial paper rates.

The EQH Facility contains affirmative, negative and financial covenants which are substantially similar to those in AB’s committed bank facilities. As of September 30, 2023, we were in compliance with these covenants. The EQH Facility also includes customary events of default substantially similar to those in AB’s committed bank facilities, including provisions under which, upon the occurrence of an event of default, all outstanding loans may be accelerated and/or the lender’s commitment may be terminated.

Amounts under the EQH Facility may be borrowed, repaid and re-borrowed by AB from ~~our operations on~~time to time until the maturity of the facility. AB or Holdings may reduce or terminate the commitment at any time without penalty upon proper notice. Holdings also may terminate the facility immediately upon a ~~consolidated basis are adequate to satisfy current liquidity requirements. The continued adequacy~~change of ~~our liquidity will depend upon factors such as future market conditions, changes in~~control of AB’s general partner.

As of September 30, 2023 and December 31, 2022, AB had $900 million outstanding under the EQH Facility, with interest ~~rate levels, policyholder perceptions~~rates of ~~our financial strength, policyholder behavior,~~approximately 5.3% and 4.3%, respectively. Average daily borrowing of the ~~effectiveness of our hedging programs, catastrophic events~~EQH Facility during the nine months ended 2023 and the ~~relative safety~~full year 2022 were $779 million and ~~attractiveness~~$655 million, respectively, with a weighted average interest rates of ~~competing products. Changes~~approximately 4.8% and 1.7%, respectively.

EQH Uncommitted Facility

In addition to the EQH Facility, AB entered into a $300 million uncommitted, unsecured senior credit facility (the “EQH Uncommitted Facility”) with EQH. The EQH Uncommitted Facility matures on September 1, 2024 and is available for AB’s general business purposes. Borrowings under the EQH Uncommitted Facility bear interest generally at a rate per annum based on prevailing overnight commercial paper rates. The EQH Uncommitted Facility contains affirmative, negative and financial covenants, which are substantially similar to those in ~~any of these factors may result in reduced or increased cash outflows. Our cash flows from investment activities result from repayments of principal, proceeds~~

the EQH Facility.

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As of September 30, 2023 and December 31, 2022, AB had $0 million and $90 million outstanding balance on the EQH Uncommitted Facility, with interest rates of approximately 0.0% and 4.3%, respectively. Average daily borrowing of the EQH Uncommitted Facility during the nine months ended September 30, 2023 and full year 2022 were $5 million and $1 million, respectively, with weighted average interest rate of approximately 4.6% and 4.3%.

from maturities and sales of invested assets and investment income, net of amounts reinvested. The primary liquidity risks with respect to these cash flows are the risk of default by debtors or bond insurers, our counterparties’ willingness to extend repurchase agreements, commitments to invest and market volatility. We closely manage these risks through our asset/liability management process and regular monitoring of our liquidity position. Our primary sources and uses of liquidity and capital are summarized below.

Three Months Ended March 31,
2018 2017
(in millions)
Cash and Cash Equivalents, beginning of period $ 4,814
$ 5,654
Net cash provided by (used in) operating activities (264 ) 72
Net cash provided by (used in) investing activities 459
(2,899 )
Net cash provided by financing activities 1,074
2,630
Effect of exchange rates 8
8
Cash and Cash Equivalents, end of period $ 6,091
$ 5,465

~~First Quarter 2018 Compared to First Quarter 2017~~

~~Cash and cash equivalents of $6.1 billion at March 31, 2018 increased $0.6 billion from $5.5 billion at March 31, 2017.~~

Net cash used in operating activities was $264 million in the first quarter of 2018, $336 million more usage than the $72 million net cash provided by operating activities in the first quarter of 2017. Cash flows from operating activities include such sources as premiums, investment management and advisory fees and investment income offset by such uses as life insurance benefit payments, policyholder dividends, compensation payments, other cash expenditures and tax payments.

Net cash provided by investing activities was $459 million in the first quarter of 2018; $3.4 billion higher than the $2.9 billion net cash used in investing activities in the first quarter of 2017. The increase was primarily related to $1.8 billion higher net sale of investments and $1.3 billion higher cash inflows from cash settlement related to derivatives as compared to the first quarter of 2017.

Cash flows provided by financing activities were $1.1 billion in the first quarter of 2018; $1.5 billion lower than the $2.6 billion net cash provided by financing activities in the first quarter of 2017. The decrease was primarily driven by $588 million lower net deposits to policyholders’ account balances, $470 million higher cash outflows of net repayment of loans from affiliates and $1.2 billion lower cash inflows from changes in collateral, which was largely offset by $459 million increase of repurchase agreement and commercial paper.

Statutory Capital of Our Insurance Subsidiaries

Our capital management framework for our insurance subsidiaries is primarily based on statutory RBC standards and the CTE asset standard for our variable annuity business.

RBC requirements are used as minimum capital requirements by the NAIC and the state insurance departments to evaluate the capital condition of regulated insurance companies. RBC is based on a formula calculated by applying factors to various asset, premium, claim, expense and statutory reserve items. The formula takes into account the risk characteristics of the insurer, including asset risk, insurance risk, interest rate risk, market risk and business risk and is calculated on a quarterly basis and made public on an annual basis. The formula is used as an early warning regulatory tool to identify possible inadequately capitalized insurers for purposes of initiating regulatory action, and not as a means to rank insurers generally. These rules apply to our insurance company subsidiaries and not to Holdings. State insurance laws provide insurance regulators the authority to require various actions by, or take various actions against, insurers whose total adjusted capital does not meet or exceed certain RBC

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levels. At the date of the most recent annual statutory financial statements filed with insurance regulators, the total adjusted capital of each of these insurance company subsidiaries subject to these requirements was in excess of each of those RBC levels.

CTE is a statistical measure of tail risk which quantifies the total asset requirement to sustain a loss if an event outside a given probability level has occurred. In the case of our analysis of variable annuity guarantees, CTE98 denotes the financial resources a company would need to cover the averageSee Note 18 of the ~~worst 2% of scenarios.~~Notes to the Consolidated Financial Statements for additional information relating to Prescribed and Permitted Statutory Accounting practices and its impact on our statutory surplus.

We target an asset level for all variable annuity products at or above a CTE98 level under most economic scenarios. For our non-variable annuity insurance liabilities, we target to maintain an RBC ratio of 350%-400%.

Captive Reinsurance ~~Companies~~Company

We use a captive reinsurance ~~companies~~company to more effectively manage our reserves and capital on an economic basis and to enable the aggregation and transfer of risks. Our captive reinsurance ~~companies assume~~company assumes business from affiliates only and ~~are~~is closed to new business. ~~All of our~~Our captive reinsurance ~~companies are wholly owned subsidiaries and are~~company is a wholly-owned subsidiary located in the United States. In addition to state insurance regulation, our ~~captives are~~captive reinsurance company is subject to internal policies governing ~~their~~its activities. We continue to analyze the use of our existing captive reinsurance ~~structures,~~structure, as well as additional third-party reinsurance arrangements. ~~On April 12, 2018, we effected an unwind of certain of our existing captive reinsurance structures as described below.~~

~~Unwind of Reinsurance of GMxB Business with a Captive Reinsurer~~

On April 12, 2018, we effected an unwind of our existing captive reinsurance structure between AXA Equitable Life and a captive reinsurer, AXA RE Arizona, an indirectly wholly owned subsidiary of Holdings. AXA Equitable Life ceded to AXA RE Arizona a 100% quota share of all liabilities for variable annuities with GMxB riders issued on or after January 1, 2006 and in-force on September 30, 2008 (the “GMxB Business”) and a 100% quota share of all liabilities for variable annuities with GMIB riders issued on or after May 1, 1999 through August 31, 2005 in excess of the liability assumed by two unaffiliated reinsurers, which are subject to certain maximum amounts or limitations on aggregate claims. AXA RE Arizona also reinsures a 90% quota share of level premium term insurance issued by AXA Equitable Life on or after March 1, 2003 through December 31, 2008 and lapse protection riders under certain series of universal life insurance policies issued by AXA Equitable Life on or after June 1, 2003 through June 30, 2007.Borrowings

In connection with the GMxB Unwind, all of the business previously reinsured to AXA RE Arizona, with the exception of the GMxB Business, was novated on April 12, 2018 to EQ AZ Life Re, a newly formed captive insurance company organized under the laws of Arizona, an indirectly and wholly owned by Holdings. Following the novation of business to EQ AZ Life Re, AXA RE Arizona, holding only the GMxB Business, was merged with and into AXA Equitable Life. As a result of the merger, the reinsurance by AXA RE Arizona of the GMxB Business will no longer be in place. Following AXA RE Arizona’s merger with and into AXA Equitable Life, the GMxB Business is not subject to any new internal or third-party reinsurance arrangements, though in the future AXA Equitable Life may reinsure the GMxB Business with third parties.

~~Description of Certain Indebtedness~~

Historically, our insurance companies have relied on AXA for most of our financing, either through internal loans or guarantees. In connection with the IPO, we have put in place a stand-alone financing strategy at Holdings targeting an overall indebtedness level in line with our U.S. public company peers. AB historically has been self-reliant for its financing, and we expect AB will remain so in its financing activities going forward. As of March 31, 2018, our total short-term and long-term external debt on a consolidated basis was $2.4 billion.

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~~The following table sets forth our total consolidated borrowings as of the dates indicated.~~ Our financial strategy going forward will remain subject to market conditions and other factors. For example, we may from time to time enter into additional bank or other financing arrangements, including public or private debt, structured facilities and contingent capital arrangements, under which we could incur additional indebtedness.

The following table sets forth the Company’s total consolidated borrowings. Short-term and long-term debt consists of the following:


	September 30,		December 31,
	2023		2022
	(in millions)
Short-term debt:


CLO short-term debt (1)	$	—	$	239
Current portion of long-term debt (2)	—		520
Total short-term debt	—		759
Long-term debt:
Senior Debenture, 7.0%, due 2028	350		350
Senior Note (4.35% due 2028)	1,492		1,491
Senior Note (5.594% due 2033)	497		—
Senior Note (5.00% due 2048)	1,481		1,481
Total long-term debt	3,820		3,322
Total borrowings	$	3,820	$	4,081

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March 31, 2018 December 31, 2017
Holdings and AXA Financial
AXA
Equitable
Life⁽¹⁾
AB Consolidated Holdings and AXA Financial
AXA
Equitable
Life
AB Consolidated
(in millions)
Short-term and long-term debt
Commercial paper $ 1,534
$ —
$ 490
$ 2,024
$ 1,290
$ —
$ 491
$ 1,781
AB Revolver —
—
—
—
—
—
75
75
Long-term debt 349
—
—
349
349
203
—
552
Total short-term and long-term debt 1,883
—
490
2,373
1,639
203
566
2,408
Loans from affiliates
Loans from affiliates 2,530
—
—
2,530
3,622
—
—
3,622
Total borrowings $ 4,413
$ —
$ 490
$ 4,903
$ 5,261
$ 203
$ 566
$ 6,030
______________


~~(1)~~	In March 2018, AXA Equitable Life sold its interest in two real estate joint ventures to AXA France for a total purchase price of approximately $143 million, which resulted in the elimination of the $203 million long-term debt shown in this column on Holdings’ consolidated balance sheet for the first quarter of 2018.

In February 2018, we entered into a $3.9 billion two-year senior unsecured delayed draw term loan agreement, a $500 million three-year senior unsecured delayed draw term loan agreement and a $2.5 billion five-year senior unsecured revolving credit facility (collectively, the “Credit Facilities”), which may provide significant support(1) CLO Warehousing Debt related to ~~our liquidity position when alternative sources~~VIE consolidation of credit are limited. The Credit Facilities contain certain administrative, reporting, legal and financial covenants, including requirements to maintain a specified minimum consolidated net worth and to maintain a ratioCLO investment.

(2) Current portion of indebtedness to total capitalization not in excess of a specified percentage, and limitations on the dollar amount of indebtedness that may be incurred by our subsidiaries and the dollar amount of secured indebtedness that may be incurred by the Company, which could restrict our operations and use of funds. Borrowings under the term loan agreements may be made only prior to this offering. In April 2018, we terminated the two-year term loan agreement, and, in May 2018, we borrowed $300 million under the three-year term loan agreement. In additionlong-term debt relates to the Credit Facilities, we entered into letter of credit facilities with an aggregate principal amount of approximately $1.9 billion, primarily to be used to support our life insurance business reinsured to EQ AZ Life Re following the GMxB Unwind. In April 2018, we also issued $3.8 billion in aggregate principal amount of notes (consisting of $800 million aggregate principal amount of 3.900%3.9% Senior Notes ~~due 2023, $1.5 billion aggregate principal amount~~which have a maturity date within one year of ~~4.350%~~December 31, 2022. The 3.9% Senior Notes ~~due 2028 and $1.5 billion aggregate principal amount of 5.000% Senior Notes due 2048) to third party investors.~~

The right to borrow funds under the Credit Facilities is subject to the fulfillment of certain conditions, including compliance with all covenants, and the ability to borrow thereunder is also subject to the continued ability of the lenders that are or will be parties to the Credit Facilities to provide funds.were repaid April 20, 2023. For additional information regarding activity pertaining to the debt repayment, see Note 14 of the Notes to the Consolidated Financial Statements.

Notes and Debentures

The Senior Notes and Senior Debentures contain customary affirmative and negative covenants, including a limitation on certain liens and a limit on the Company’s ability to consolidate, merge or sell or otherwise dispose of all or substantially all of its assets. The Senior Notes and Senior Debentures also include customary events of default (with customary grace periods, as applicable), including provisions under which, upon the occurrence of an event of default, all outstanding Senior Notes and Senior Debentures may be accelerated. As of September 30, 2023, the Company is in ~~our Credit Facilities and the conditions to borrowing thereunder, see “Risk Factors” in the Prospectus.~~compliance with all debt covenants.

Ratings

Financial strength ratings (which are sometimes referred to as “claims-paying” ratings) and credit ratings are important factors affecting public confidence in an insurer and its competitive position in marketing products. Our credit ratings are also important for our ability to raise capital through the issuance of debt and for the cost of such financing.

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A downgrade of our debt ratings could affect our ability to raise additional debt with terms and conditions similar to our current debt, and accordingly, likely increase our cost of capital. In addition, a downgrade of these ratings could make it more difficult to raise capital to refinance any maturing debt obligations, to support business growth at our insurance subsidiaries and to maintain or improve the current financial strength ratings of our principal insurance subsidiaries. Upon announcement of AXA’s plan to pursue the IPO and the filing of the initial Form S-1 on November 13, 2017, AXA Equitable Life’s and AXA Financial’s ratings were downgraded by AM Best, S&P and Moody’s. The downgrades reflected the removal of the uplift associated with assumed financial support from AXA.

Financial strength ratings represent the opinions of rating agencies regarding the financial ability of an insurance company to meet its obligations under an insurance policy. Credit ratings represent the opinions of rating agencies regarding an entity’s ability to repay its indebtedness. The following table summarizes the ratings for Holdings and certain of its subsidiaries.

AM Best, S&P and Moody’s have a stable outlook.

AM Best

S&P

Moody’s

Last review date

~~3/7/2018~~Feb '23

~~3/6/2018~~Jun '23

~~4/11/2018~~May '23

Financial Strength Ratings:

~~AXA~~ Equitable Financial Life Insurance Company

A+

A2A1

~~MLOA~~Equitable Financial Life Insurance Company of America

A+

A2A1

Credit Ratings:

~~Credit Ratings:~~Equitable Holdings, Inc.

bbb+

BBB+

Baa1

~~Holdings~~Last review date

—

~~BBB+~~Sep '23

~~Baa2~~Aug '23

~~AXA Financial~~AllianceBernstein L.P.

~~bbb+~~

~~BBB+~~A

~~Baa2~~

~~Last Review Date~~

~~12/29/2017~~

~~5/17/2017~~

—

~~SUPPLEMENTARY INFORMATION~~

~~We are involved in a number of ventures and transactions with AXA and certain of its affiliates. See Note 12 of the Notes to Consolidated Financial Statements included herein.~~

~~Contractual Obligations~~Material Cash Requirement

Our ~~consolidated contractual agreements~~material cash requirements include policyholder obligations, long-term debt, commercial paper, ~~loans from affiliates,~~ employee benefits, operating leases and various funding commitments. See ~~“Supplementary Information – Contractual Obligations”~~“Material Cash Requirement” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the ~~Prospectus for additional information.~~Recast 2022 Annual Report.

~~Off-Balance Sheet Arrangements~~

At March 31, 2018, the Company was not a party to any off-balance sheet transactions other than those guarantees and commitments described in Note 14 of the Notes to Consolidated Financial Statements included herein.

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Summary of Critical Accounting ~~Policies~~Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to adopt accounting policies and make estimates and assumptions that affect amounts reported in our consolidated financial statements included elsewhere herein. For a discussion of our significant accounting policies, see Note 2 of the Notes to the Consolidated Financial Statements. The most critical estimates include those used in determining:

~~liabilities for future policy benefits;~~•market risk benefits and purchased market risk benefits

•accounting for reinsurance;

~~capitalization and amortization of DAC;~~

•estimated fair values of investments in the absence of quoted market values and investment impairments;

•estimated fair values of freestanding derivatives and the recognition and estimated fair value of embedded derivatives requiring bifurcation;

•goodwill and related impairment;

•measurement of income taxes and the valuation of deferred tax assets; and

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•liabilities for litigation and regulatory matters.

In applying our accounting policies, we make subjective and complex judgments that frequently require estimates about matters that are inherently uncertain. Many of these policies, estimates and related judgments are common in the insurance and financial services industries while others are specific to our business and operations. Actual results could differ from these estimates.

~~As previously~~

Market Risk Benefits

Market risk benefits include contract features that provide minimum guarantees to policyholders and include GMIB, GMDB, GMWB, GMAB, and ROP DB benefits. MRBs are measured at estimated fair value with changes reported ~~we identified two material weaknesses~~ in the ~~design~~change in market risk benefits and ~~operation~~purchased market risk benefits on the Consolidated Statement of Income (Loss), except for the portion of the fair value change related to the Company’s own credit risk, which is recognized in OCI.

MRBs are measured at fair value on a seriatim basis using an ascribed fee approach based upon policyholder behavior projections and risk neutral economic scenarios adjusted based on the facts and circumstances of the Company’s product features. Market conditions including, but not limited to, changes in interest rates, equity indices, market volatility and variations in actuarial assumptions, including policyholder behavior, mortality and risk margins related to non-capital market inputs, as well as changes in our nonperformance risk adjustment may result in significant fluctuations in the estimated fair value of the MRBs that could materially affect net income.

Risk margins are established to capture the non-capital market risks of the instrument which represent the additional compensation a market participant would require to assume the risks related to the uncertainties in certain actuarial assumptions. The establishment of risk margins requires the use of significant management judgment, including assumptions of the amount needed to cover the guarantees.

We ceded the risk associated with certain of the variable annuity products with GMxB features described in the preceding paragraphs. The value of the MRBs on the ceded risk is determined using a methodology consistent with that described previously for the guarantees directly written by us with the exception of the input for nonperformance risk that reflects the credit of the reinsurer.

Nonperformance Risk Adjustment

The valuation of our ~~internal control~~MRBs includes an adjustment for the risk that we fail to satisfy our obligations, which we refer to as our nonperformance risk. The nonperformance risk adjustment, which is captured as a spread over the risk-free rate in determining the discount rate to discount the cash flows of the liability, is determined by taking into consideration publicly available information relating to spreads on corporate bonds in the secondary market comparable to Holdings’ financial ~~reporting. Our management has concluded~~strength rating.

The table below illustrates the impact that a range of reasonably likely variances in credit spreads would have on our consolidated balance sheet, excluding the effect of income tax, related to the GMxB Core and GMxB Legacy MRBs measured at estimated fair value. Even when credit spreads do not change, the impact of the nonperformance risk adjustment on fair value will change when the cash flows within the fair value measurement change. The table only reflects the impact of changes in credit spreads on our consolidated financial statements included elsewhere herein and not these other potential changes. In determining the ranges, we have considered current market conditions, as well as the market level of spreads that can reasonably be anticipated over the near term. The ranges do not reflect extreme market conditions such as those experienced during the 2008–2009 financial crisis as we do not ~~(1) maintain effective controls~~consider those to timely validate that actuarial models are properly configured to capture all relevant product features and to provide reasonable assurance, timely reviews of assumptions and data have occurred; and (2) maintain sufficient experienced personnel to prepare the Company’s consolidated financial statements and to verify that consolidating and adjusting journal entries were completely and accurately recorded to the appropriate accounts or segments. We are currentlybe reasonably likely events in the ~~process~~near future.

NPR Sensitivity

December 31, 2022


	Increase/(Decrease) In MRB
	(in millions)
Increase in NPR by 50bps	$	(1,297)
Decrease in NPR by 50bps	$	1,387

Sensitivity of ~~remediating these material weaknesses~~MRBs to Changes in Interest Rates

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The following table demonstrates the sensitivity of the MRBs to changes in long-term interest rates by ~~taking steps~~quantifying the adjustments that would be required, assuming an increase and decrease in long-term interest rates of 50bps. This information considers only the direct effect of changes in the interest rates on MRB balances, net of reinsurance.

Interest Rate Sensitivity

December 31, 2022


	Increase/(Decrease) In MRB
	(in millions)
Increase in interest rates by 50bps	$	(875)
Decrease in interest rates by 50bps	$	998

Sensitivity of MRBs to ~~(i) validate all existing actuarial models~~Changes in Equity Returns

The following table demonstrates the sensitivity of the MRBs to changes in equity returns:

Equity Returns Sensitivity

December 31, 2022


	Increase/(Decrease) In MRB
	(in millions)
Increase in equity returns by 10%	$	(886)
Decrease in equity returns by 10%	$	988

Sensitivity of MRBs to Changes in GMIB Lapses

Lapse rates are adjusted at the contract level based on a comparison of the value of the embedded GMIB rider and ~~valuation systems~~the current policyholder account value, which include other factors such as ~~well as~~considering surrender charges. Generally, lapse rates are assumed to ~~improve controls and processes around our assumption and data process and (ii) strengthen~~be lower in periods when a surrender charge applies. A dynamic lapse function reduces the ~~control function related to the financial closing process. Although we plan to complete these remediation processes as quickly as possible, we cannot at this time estimate~~base lapse rate when the ~~remediations will be completed.~~guaranteed amount is greater than the account value as in-the-money contracts are less likely to lapse.

A discussion of each of the critical accounting estimates may be found in the Prospectus in “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Estimates — Application of Critical Accounting Estimates.”GMIB Lapse floor Sensitivity

December 31, 2022


	Increase/(Decrease) In MRB
	(in millions)
GMIB Lapse floor of 1%	$	(178)

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes to the quantitative and qualitative disclosures about market risk described in the ~~Prospectus~~Recast 2022 Annual Report in ~~“Quantitative~~"Quantitative and Qualitative Disclosures About Market ~~Risk”~~Risk".

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Item 4. Controls and Procedures

~~Evaluation of Disclosure Controls and Procedures~~

~~The management of the Company,~~Management, with the participation of the ~~Company’s~~ Chief Executive Officer ~~(CEO)~~ and Chief Financial Officer, ~~(CFO),~~ has evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures, ~~(as~~as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of March 31, 2018. This evaluation is performed to determine if our disclosure controls and procedures are effective to provide reasonable assurance that information required to be disclosed by the Company in the reports that it files or submits under the Securities and Exchange Act of 1934, as amended, is accumulated and communicated to management, including the Company’s CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure and are effective to provide reasonable assurance that such information is recorded, processed, summarized and reported within the time periods specified by the Securities and Exchange Commission’s rules and forms.

~~As previously reported, the Company identified two material weaknesses in the design and operation~~ of the ~~Company’s internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting,~~Exchange Act. Based on such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis. The Company’s management, includingevaluation, the ~~Company’s CEO~~Chief Executive Officer and ~~CFO,~~Chief Financial Officer have concluded that, ~~we do not (i) maintain effective controls to timely validate actuarial models are properly configured to capture all relevant product features and to provide reasonable assurance timely reviews~~as of assumptions and data have occurred, and, as a result, errors were identified in future policyholders’ benefits and deferred policy acquisition costs balances; and (ii) maintain sufficient experienced personnel to prepare the Company’s consolidated financial statements and to verify consolidating and adjusting journal entries were completely and accurately recorded to the appropriate accounts or segments and, as a result, errors were identified in the consolidated financial statements, including in the presentation and disclosure between the operating and financing sections of the statements of cash flows. These material weaknesses resulted in misstatements in the Company’s previously issued annual and interim financial statements and resulted in (i) the restatement of the annual financial statements for the year ended December 31, 2016, the restatements of the interim financial statements for the nine months ended September 30, 2017 and for the six months ended June 30, 2017, the revision of the annual financial statements for the year ended December 31, 2015 and the revision of the interim financial statements for the nine months ended September 30, 2016 and for the six months ended June 30, 2016, in each case that were reported in the preliminary prospectus included in the first amendment of our Form S-1 registration statement filed on February 14, 2018 and (ii) the restatement of the interim financial statements for the six months ended June 30, 2017 and the revision of the annual financial statements for the years ended December 31, 2016, 2015 and 2014 and the interim financial statements for the six months ended June 30, 2016, in each case that were reported in the preliminary prospectus included in our initial Form S-1 registration statement filed on November 13, 2017. Until remedied, these material weaknesses could result in a misstatement of the Company’s consolidated financial statements or disclosures that would result in a material misstatement to the Company’s annual or interim financial statements that would not be prevented or detected.

~~Due to these material weaknesses, the Company’s management, including the Company’s CEO and CFO, concluded that~~2023, the Company’s disclosure controls and procedures were ~~not effective as of March 31, 2018.~~effective.

Since identifying the material weakness related to our actuarial models, we have been, and are currently in the process of, remediating by taking steps to validate all existing actuarial models and valuation systems as well as to improve controls and processes around our assumption and data process. These steps include verifying inputs and unique algorithms, ensuring alignment with documented accounting standards and verifying assumptions used in our models are consistent with documented assumptions and data is reliable. The remediation efforts are being performed by our internal model risk team (which is separate from our modeling and valuation teams), as supported by third party firms. We will continue to enhance controls to ensure our models, including assumptions and data, are revalidated on a fixed calendar schedule and that new model changes and product features are tested through our internal model risk team prior to adoption within our models and systems. Although we plan to complete this remediation process as quickly as possible, we cannot at this time estimate when the remediation will be completed.

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Since identifying the material weakness related to our journal entry process, we have been, and are currently in the process of, remediating by taking steps to strengthen the control function related to our financial closing process. These steps include recruiting additional personnel, retaining external expert resources, further automating entries where possible, enhancing the design of certain management review controls and providing training regarding internal control processes. We will continue to enhance controls to ensure the financial closing process is effectively implemented. Although we plan to complete this remediation process as quickly as possible, we cannot at this time estimate when the remediation will be completed.

~~Changes in Internal Control Over Financial reporting~~

~~As described above, the Company has designed and implemented additional controls in connection with its remediation plan. Other than these additional controls, there were no changes~~No change in the Company’s internal control over financial reporting (as defined in Rule ~~13a-15(e)~~13a-15(f) and Rule 15d-15(f) under the ~~Securities~~ Exchange ~~Act of 1934 for~~Act) occurred during the quarter ended ~~March 31, 2018~~September 30, 2023 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART IIII. OTHER INFORMATION

Item 1. Legal Proceedings

~~See~~For information regarding certain legal proceedings pending against us, see Note 1416 of the Notes to the Consolidated Financial Statements ~~contained herein. Except as disclosed~~(unaudited) in ~~Note 14 of Notes to Consolidated Financial Statements, there have been no new material legal proceedings~~this Form 10-Q. Also see “Risk Factors—Legal and ~~no new material developments in legal proceedings previously reported~~Regulatory Risks—Legal and regulatory actions” included in the ~~Prospectus.~~Recast 2022 Annual Report.

Item 1A. Risk Factors

You should carefully consider the risks described in the “Risk Factors” section included in the ~~Prospectus. These risks could materially affect our business, consolidated results of operations or financial condition. These risks are not exclusive, and additional risks~~Recast 2022 Annual Report. Risks to which we are subject also include, but are not limited to, the factors mentioned under ~~“Forward-Looking Statements”~~“Note Regarding Forward-Looking Statements and Information” above and the risks of our businesses described elsewhere in this Quarterly Report on Form 10-Q.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

~~NONE.~~The following table provides information about purchases by Holdings during the three months ended September 30, 2023, of its common stock:


Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
7/1/23 through 7/31/23	2,414,508	$	29.41	2,414,508	$	558,985,480
8/1/23 through 8/31/23	2,318,884	$	28.46	2,318,884	506,988,787
9/1/23 through 9/30/23	3,559,117	$	28.34	3,559,117	$	392,109,581
Total	8,292,509	$	28.69	8,292,509	$	392,109,581

See Note 13 to the Notes to Consolidated Financial Statements for ASR transaction detail during the three months ended September 30, 2023.

Item 3. Defaults Upon Senior Securities

~~NONE.~~None.

Item 4. Mine Safety Disclosures

~~NONE.~~Not applicable.

Item 5. Other Information

~~Iran Threat Reduction~~Securities Trading Plans of Directors and ~~Syria Human Rights Act~~Executive Officers

~~Holdings~~A significant portion of the compensation of our executive officers is delivered in the form of equity awards, including restricted stock units and ~~its subsidiaries had no~~performance shares. All vehicles contain vesting requirements related to service, with performance shares also requiring the satisfaction of certain performance criteria related to corporate performance to obtain a payout. This compensation design is intended to align executive compensation with the performance experienced by our shareholders. Following the delivery of shares of our common stock under those equity awards, once any applicable service- or performance-based vesting standards have been satisfied, our executive officers from time to time engage in the open-market sale of some of those shares. Our executive officers may also engage from time to time in other transactions ~~or activities requiring disclosure~~involving our securities.

Transactions in our securities by our executive officers are required to be made in accordance with our Insider Trading Policy, which, among other things, requires that the transactions be in accordance with applicable U.S. federal securities laws that prohibit trading while in possession of material nonpublic information. Rule 10b5-1 under the ~~Iran Threat Reduction and Syria Human Rights~~Exchange Act ~~(“Iran Act”), nor were we involved~~provides an affirmative defense that enables prearranged transactions in ~~the AXA Group matters described immediately below.~~securities in a manner that avoids concerns about initiating transactions at a future date while possibly in possession of material nonpublic information. Our Insider Trading Policy permits our executive officers to enter into trading plans designed to comply with Rule 10b5-1.

The non-U.S. based subsidiaries of AXA operate in compliance with applicable laws and regulations of the various jurisdictions in which they operate, including applicable international (United Nations and European Union) laws and regulations. While AXA Group companies based and operating outside the United States generally are not subject to U.S. law, as an international group, AXA has in place policies and standards (including the AXA Group International Sanctions Policy) that apply to all AXA Group companies worldwide and often impose requirements that go well beyond local law.

AXA has informed us that AXA Konzern AG, an AXA insurance subsidiary organized under the laws of Germany, provides car, accident and health insurance to diplomats based at the Iranian Embassy in Berlin, Germany. The total annual premium of these policies is approximately $139,700 before tax and the annual net profit arising from these policies, which is difficult to calculate with precision, is estimated to be $26,000. These policies were underwritten by a broker who specializes in providing insurance coverage for diplomats.

In addition, AXA has informed us that AXA Insurance Ireland, an AXA insurance subsidiary, provides statutorily required car insurance under four separate policies to the Iranian Embassy in Dublin, Ireland. AXA has informed us that compliance with the Declined Cases Agreement of the Irish Government prohibits the cancellation of these policies unless another insurer is

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~~willing to assume~~The following table describes contracts, instructions or written plans for the ~~coverage. The total annual premium for these policies is approximately $6,268 and~~sale or purchase of our securities adopted by our executive officers during the ~~annual net profit arising from these policies,~~three months ended September 30, 2023, which is ~~difficult~~intended to ~~calculate~~satisfy the affirmative defense conditions of Rule 10b5-1(c), referred to as Rule 10b5-1 trading plans. The plan listed below is only executed when the stock price reaches a required minimum. In addition, the executives identified in the table below are required to maintain an ownership of the Company’s common stock with ~~precision, is estimated~~a value equal to ~~be $764.~~at least a multiple of their annual base salary (3 times for Mr. Lane).

~~Also, AXA has informed us that AXA Sigorta,~~

Name and Title

Date of Adoption of Rule 10b5-1 Trading Plan

Scheduled Start Date of Rule 10b5-1 Trading Plan

Scheduled Expiration Date of Rule 10b5-1 Trading Plan(1)

Aggregate Number of Securities to be Purchased or Sold

Nick Lane

Head of Retirement, Wealth Management and Protection Solutions

9/22/2023

12/22/2023

6/15/2024

Sale of up to 60,000 shares(2) of common stock in several transactions through the scheduled expiration date in 2024.

(1)In each case, a ~~subsidiary of AXA organized~~Rule 10b5-1 trading plan may also expire on such earlier date as all transactions under the ~~laws~~Rule 10b5-1 trading plan are completed.

(2)30,000 of ~~Turkey, provides car insurance coverage for vehicle pools~~Mr. Lane’s shares consist of stock options and 30,000 of Mr. Lane’s shares consist of common stock already owned.

During the three months ended September 30, 2023, none of the ~~Iranian General Consulate and the Iranian Embassy~~Company’s directors adopted, terminated or modified a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in ~~Istanbul, Turkey. Motor liability insurance coverage is mandatory in Turkey and cannot be canceled unilaterally. The total annual premium in respect~~Item 408 of ~~these policies is approximately $3,150 and the annual net profit, which is difficult to calculate with precision, is estimated to be $473.~~

~~Additionally, AXA has informed us that AXA Winterthur, an AXA insurance subsidiary organized under the laws of Switzerland, provides Naftiran Intertrade, a wholly-owned subsidiary~~Regulation S-K of the ~~Iranian state-owned National Iranian Oil Company, with life, disability and accident coverage for its employees. The provision~~Securities Act of these forms of coverage is mandatory for employees in Switzerland. The total annual premium of these policies is approximately $373,668 and the annual net profit arising from these policies, which is difficult to calculate with precision, is estimated to be $56,000.1933.

Lastly, AXA has informed us that AXA Egypt, an AXA insurance subsidiary organized under the laws of Egypt, provides the Iranian state-owned Iran Development Bank two life insurance contracts, covering individuals who have loans with the bank. The total annual premium of these policies is approximately $34,446 and annual net profit arising from these policies, which is difficult to calculate with precision, is estimated to be $3,500.

The aggregate annual premium for the above-referenced insurance policies is approximately $557,232, representing approximately 0.0006% of AXA’s 2017 consolidated revenues, which exceed $100 billion. The related net profit, which is difficult to calculate with precision, is estimated to be $86,737, representing approximately 0.001% of AXA’s 2017 aggregate net profit.

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~~Table of Contents~~

Item 6. Exhibits



Number			Description and Method of Filing

~~3.1#~~31.1		~~Amended and Restated Certificate of Incorporation of AXA Equitable Holdings, Inc.~~
~~3.2#~~ #	~~Amended and Restated By-Laws of AXA Equitable Holdings, Inc.~~
~~4.1~~	Form of Common Stock Certificate of AXA Equitable Holdings, Inc. (incorporated by reference to Exhibit 4.1 to the Registration Statement on Form S-1 of AXA Equitable Holdings, Inc., Registration No. 333-221521 (the “Form S-1”)).
~~4.2~~	Indenture, dated as of April 20, 2018, among AXA Equitable Holdings, Inc., as issuer, Wilmington Saving Fund Society, FSB, as trustee, and Citibank, N.A., as security registrar and paying agent (incorporated by reference to Exhibit 4.4 to the Form S-1).
~~4.3~~	First Supplemental Indenture, dated as of April 20, 2018, among AXA Equitable Holdings, Inc., as issuer, Wilmington Saving Fund Society, FSB, as trustee, and Citibank, N.A., as security registrar and paying agent (incorporated by reference to Exhibit 4.5 to the Form S-1).
~~4.4~~	Second Supplemental Indenture, dated as of April 20, 2018, among AXA Equitable Holdings, Inc., as issuer, Wilmington Saving Fund Society, FSB, as trustee, and Citibank, N.A., as security registrar and paying agent (incorporated by reference to Exhibit 4.6 to the Form S-1).
~~4.5~~	Third Supplemental Indenture, dated as of April 20, 2018, among AXA Equitable Holdings, Inc., as issuer, Wilmington Saving Fund Society, FSB, as trustee, and Citibank, N.A., as security registrar and paying agent (incorporated by reference to Exhibit 4.7 to the Form S-1).
~~10.1#~~	~~Shareholder Agreement, dated as of May 4, 2018, between AXA S.A. and AXA Equitable Holdings, Inc.~~
~~10.2#~~	~~Registration Rights Agreement, dated as of May 4, 2018, between AXA S.A. and AXA Equitable Holdings, Inc.~~
~~10.3~~	~~Tax Sharing Agreement, dated March 28, 2018, among AXA S.A., AXA Investment Managers S.A. and AXA Equitable Holdings, Inc. (incorporated by reference to Exhibit 10.3 to the Form S-1).~~
~~10.4#~~	~~Transitional Services Agreement, dated as of May 4, 2018, between AXA S.A. and AXA Equitable Holdings, Inc.~~
~~10.5#~~	~~Trademark License Agreement, dated as of May 4, 2018, among AXA S.A., AXA Equitable Holdings, Inc. and AXA Financial, Inc.~~
~~10.6†#~~	~~Director Indemnification Agreement between AXA Equitable Holdings, Inc. and each of its directors.~~
~~10.7~~	Revolving Credit Agreement, dated as of February 16, 2018, by and among AXA Equitable Holdings, Inc., the Subsidiary Account Parties (as defined therein) party thereto, the banks party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent, is incorporated by reference to Exhibit 10.22 to the Form S-1 (incorporated by reference to Exhibit 10.22 to the Form S-1).
~~10.8~~	Term Loan Agreement, dated as of February 16, 2018, by and among AXA Equitable Holdings, Inc., the banks party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.23 to the Form S-1).
~~10.9~~	Term Loan Agreement, dated as of February 16, 2018, by and among AXA Equitable Holdings, Inc., the banks party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.24 to the Form S-1).
~~10.10~~	Reimbursement Agreement, dated as of February 16, 2018, by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and Natixis, New York Branch (incorporated by reference to Exhibit 10.25 to the Form S-1).
~~10.11~~	Reimbursement Agreement, dated as of February 16, 2018, by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and HSBC Bank USA, National Association (incorporated by reference to Exhibit 10.26 to the Form S-1).
~~10.12~~	Reimbursement Agreement, dated as of February 16, 2018, by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and Citibank Europe PLC (incorporated by reference to Exhibit 10.27 to the Form S-1).
~~10.13~~	Reimbursement Agreement, dated as of February 16, 2018, by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and Credit Agricole Corporate and Investment Bank (incorporated by reference to Exhibit 10.28 to the Form S-1).

~~137~~

~~Table of Contents~~



~~Number~~	~~Description and Method of Filing~~
~~10.14~~	Reimbursement Agreement, dated as of February 16, 2018, by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and Barclays Bank PLC (incorporated by reference to Exhibit 10.29 to the Form S-1).
~~10.15~~	Reimbursement Agreement, dated as of February 16, 2018, by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and JPMorgan Chase Bank, N.A. (incorporated by reference to Exhibit 10.30 to the Form S-1).
~~10.16~~	Reimbursement Agreement, dated as of February 16, 2018, by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and Landesbank Hessen-Thüringen Girozentrale, acting through its New York Branch (incorporated by reference to Exhibit 10.31 to the Form S-1).
~~10.17~~	Reimbursement Agreement, dated as of February 16, 2018, by and among AXA Equitable Holdings, Inc. the Subsidiary Account Parties (as defined therein) party thereto and Commerzbank AG, New York Branch (incorporated by reference to Exhibit 10.32 to the Form S-1).
~~10.18~~	~~Waiver Letter Agreements with the lenders party to each of the agreements in Exhibits 10.22 to 10.32 to the Form S-1 (incorporated by reference to Exhibit 10.33 to the Form S-1).~~
~~10.19†~~	~~AXA Equitable Holdings, Inc. Short-Term Incentive Compensation Plan (incorporated by reference to Exhibit 10.56 to the Form S-1).~~
~~10.20†~~	~~AXA Equitable Holdings, Inc. 2018 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.57 to the Form S-1).~~
~~10.21~~†#	~~Form of Transaction Incentive Award Agreement under the 2018 Omnibus Incentive Plan.~~
~~10.22†#~~	~~Form of Restricted Stock Unit Award Agreement under the 2018 Omnibus Incentive Plan.~~
~~10.23†#~~	~~Form of Performance Share Award Agreement under the 2018 Omnibus Incentive Plan.~~
~~10.24†#~~	~~Form of Stock Option Award Agreement under the 2018 Omnibus Incentive Plan.~~
~~10.25~~†#	~~AXA Equitable Supplemental Severance Plan for Executives.~~
~~31.1~~#	Certification of the Registrant’s Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2#		#	Certification of the Registrant’s Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1#		#	Certification of the Registrant’s Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2#		#	Certification of the Registrant’s Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS			XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH			Inline XBRL Taxonomy Extension Schema Document
101.CAL			Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB			Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE			Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF			Inline XBRL Taxonomy Extension Definition Linkbase Document
104			Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibits 101).

______________

# Filed herewith.

~~† Identifies each management contract or compensatory plan or arrangement.~~

143

~~138~~

Table of Contents

GLOSSARY

Selected Financial Terms


Account Value (“AV”)			Generally equals the aggregate policy account value of our retirement and protection products. General Account AV refers to account balances in investment options that are backed by the General Account while Separate Accounts AV refers to Separate Accounts investment assets.

Alternative investments			Investments in real estate and real estate joint ventures and other limited partnerships.

Assets under administration (“AUA”)			Includes non-insurance client assets that are invested in our savings and investment products or serviced by our Equitable Advisors platform. We provide administrative services for these assets and generally record the revenues received as distribution fees.

Assets under management (“AUM”)			Investment assets that are managed by one of our subsidiaries and includes: (i) assets managed by AB, (ii) the assets in our GAIA portfolio and (iii) the Separate Account assets of our retirement and protection businesses. Total AUM reflects exclusions between segments to avoid double counting.

Combined RBC Ratio			Calculated as the overall aggregate RBC ratio for the Company’s insurance subsidiaries including capital held for its life insurance and variable annuity liabilities and non-variable annuity insurance liabilities.

Conditional tail expectation (“CTE”)			Calculated as the average amount of total assets required to satisfy obligations over the life of the contract or policy in the worst x% of scenarios. Represented as CTE (100 less x). Example: CTE95 represents the worst five percent of scenarios.

Deferred policy acquisition cost (“DAC”)			Represents the incremental costs related directly to the successful acquisition of new and certain renewal insurance policies and annuity contracts and which have been deferred on the consolidated balance sheet as an asset.

Deferred sales inducements (“DSI”)			Represent amounts that are credited to a policyholder’s account balance that are higher than the expected crediting rates on similar contracts without such an inducement and that are an incentive to purchase a contract and also meet the accounting criteria to be deferred as an asset that is amortized over the life of the contract.

Dividends Received Deduction (“DRD”)			A tax deduction under U.S. federal income tax law received by a corporation on the dividends it receives from other corporations in which it has an ownership stake.

Fee-type revenue			Revenue from fees and related items, including policy charges and fee income, premiums, investment management and service fees, and other income.

Gross Premiums			First year premium and renewal premium and deposits


Invested assets			Includes fixed maturity securities, equity securities, mortgage loans, policy loans, alternative investments and short-term investments.

Protection Solutions Reserves			Equals the aggregate value of Policyholders’ account balances and Future policy benefits for policies in our Protection Solutions segment.

Reinsurance			Insurance policies purchased by insurers to limit the total loss they would experience from an insurance claim.

Renewal premium and deposits			Premiums and deposits after the first twelve months of the policy or contract.

Risk-based capital (“RBC”)			Rules to determine insurance company statutory capital requirements. It is based on rules published by the National Association of Insurance Commissioners (“NAIC”).

Total adjusted capital (“TAC”)			Primarily consists of capital and surplus, and the asset valuation reserve.

Product Terms

401(k)			A tax-deferred retirement savings plan sponsored by an employer. 401(k) refers to the section of the Internal Revenue Code of 1986, as amended (the “Code”) pursuant to which these plans are established.

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403(b)			A tax-deferred retirement savings plan available to certain employees of public schools and certain tax-exempt organizations. 403(b) refers to the section of the Code pursuant to which these plans are established.

Affluent			Refers to individuals with $250,000 to $999,999 of investable assets.

Annuitant			The person who receives annuity payments or the person whose life expectancy determines the amount of variable annuity payments upon annuitization of an annuity to be paid for life.

Annuitization			The process of converting an annuity investment into a series of periodic income payments, generally for life.


Benefit base			A notional amount (not actual cash value) used to calculate the owner’s guaranteed benefits within an annuity contract. The death benefit and living benefit within the same contract may not have the same benefit base.

Cash surrender value			The amount an insurance company pays (minus any surrender charge) to the policyholder when the contract or policy is voluntarily terminated prematurely.

Dollar-for-dollar withdrawal			A method of calculating the reduction of a variable annuity benefit base after a withdrawal in which the benefit is reduced by one dollar for every dollar withdrawn.

EQUI-VEST Group (“EG”)			A traditional variable deferred annuity without enhanced guaranteed benefits with single and ongoing premiums sold in the tax-exempt 403(b)/(457(b) markets.

EQUI-VEST Individual (“EI”)			A traditional variable deferred annuity without enhanced guaranteed benefits sold in the individual market.

Future policy benefits			Future policy benefits for the annuities business are comprised mainly of liabilities for life-contingent income annuities, and liabilities for the variable annuity guaranteed minimum benefits accounted for as insurance. Future policy benefits for the life business are comprised mainly of liabilities for traditional life and certain liabilities for universal and variable life insurance contracts (other than the Policyholders’ account balance).

General Account Investment Portfolio			The invested assets held in the General Account.

General Account			The assets held in the general accounts of our insurance companies as well as assets held in our Separate Accounts on which we bear the investment risk.

GMxB			A general reference to all forms of variable annuity guaranteed benefits, including guaranteed minimum living benefits, or GMLBs (such as GMIBs, GMWBs and GMABs), and guaranteed minimum death benefits, or GMDBs (inclusive of return of premium death benefit guarantees).

GMxB Core			Retirement Cornerstone and Accumulator sold 2011 and later.

GMxB Legacy			Fixed-rate GMxB business written prior to 2011.

Guaranteed income benefit (“GIB”)			An optional benefit which provides the policyholder with a guaranteed lifetime annuity based on predetermined annuity purchase rates applied to a GIB benefit base, with annuitization automatically triggered if and when the contract AV falls to zero.


Guaranteed minimum accumulation benefits (“GMAB”)			An optional benefit (available for an additional cost) which entitles an annuitant to a minimum payment, typically in lump-sum, after a set period of time, typically referred to as the accumulation period. The minimum payment is based on the benefit base, which could be greater than the underlying AV.

Guaranteed minimum death benefits (“GMDB”)			An optional benefit (available for an additional cost) that guarantees an annuitant’s beneficiaries are entitled to a minimum payment based on the benefit base, which could be greater than the underlying AV, upon the death of the annuitant.

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Guaranteed minimum income benefits (“GMIB”)			An optional benefit (available for an additional cost) where an annuitant is entitled to annuitize the policy and receive a minimum payment stream based on the benefit base, which could be greater than the underlying AV.

Guaranteed minimum living benefits (“GMLB”)			A reference to all forms of guaranteed minimum living benefits, including GMIBs, GMWBs and GMABs (does not include GMDBs).

Guaranteed minimum withdrawal benefits (“GMWB”)			An optional benefit (available for an additional cost) where an annuitant is entitled to withdraw a maximum amount of their benefit base each year, for which cumulative payments to the annuitant could be greater than the underlying AV.

Guaranteed Universal Life (“GUL”)			A universal life insurance offering with a lifetime no lapse guarantee rider, otherwise known as a guaranteed UL policy. With a GUL policy, the premiums are guaranteed to last the life of the policy.

Guaranteed withdrawal benefit for life (“GWBL”)			An optional benefit (available for an additional cost) where an annuitant is entitled to withdraw a maximum amount of their benefit base each year, for the duration of the policyholder’s life, regardless of account performance.

High net worth			Refers to individuals with $1,000,000 or more of investable assets.

Investment Edge (“IE”)			A traditional variable deferred annuity without enhanced guaranteed benefits.

Indexed Universal Life (“IUL”)			A permanent life insurance offering built on a universal life insurance framework that uses an equity-linked approach for generating policy investment returns.

Investment Edge (“IE”)			A traditional variable deferred annuity without enhanced guaranteed benefits that provides tax-efficient distribution.

Living benefits			Optional benefits (available at an additional cost) that guarantee that the policyholder will get back at least his original investment when the money is withdrawn.

Mortality and expense risk fee (“M&E fee”)			A fee charged by insurance companies to compensate for the risk they take by issuing life insurance and variable annuity contracts.


Net flows			Net change in customer account balances in a period including, but not limited to, gross premiums, surrenders, withdrawals and benefits. It excludes investment performance, interest credited to customer accounts and policy charges.

Policyholder account balances			Annuities. Policyholder account balances are held for fixed deferred annuities, the fixed account portion of variable annuities and non-life contingent income annuities. Interest is credited to the policyholder’s account at interest rates we determine which are influenced by current market rates, subject to specified minimums. Life Insurance Policies. Policyholder account balances are held for retained asset accounts, universal life policies and the fixed account of universal variable life insurance policies. Interest is credited to the policyholder’s account at interest rates we determine which are influenced by current market rates, subject to specified minimums.

Return of premium (“ROP”) death benefit			This death benefit pays the greater of the account value at the time of a claim following the owner’s death or the total contributions to the contract (subject to adjustment for withdrawals). The charge for this benefit is usually included in the M&E fee that is deducted daily from the net assets in each variable investment option. We also refer to this death benefit as the Return of Principal death benefit.

Rider			An optional feature or benefit that a policyholder can purchase at an additional cost.

Separate Account			Refers to the separate account investment assets of our insurance subsidiaries excluding the assets held in those Separate Accounts on which we bear the investment risk.

Surrender charge			A fee paid by a contract owner for the early withdrawal of an amount that exceeds a specific percentage or for cancellation of the contract within a specified amount of time after purchase.


Surrender rate			Represents annualized surrenders and withdrawals as a percentage of average AV.

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Universal life (“UL”) products			Life insurance products that provide a death benefit in return for payment of specified annual policy charges that are generally related to specific costs, which may change over time. To the extent that the policyholder chooses to pay more than the charges required in any given year to keep the policy in-force, the excess premium will be placed into the AV of the policy and credited with a stated interest rate on a monthly basis.

Variable annuity			A type of annuity that offers guaranteed periodic payments for a defined period of time or for life and gives purchasers the ability to invest in various markets though the underlying investment options, which may result in potentially higher, but variable, returns.

Variable Universal Life (“VUL”)			Universal life products where the excess amount paid over policy charges can be directed by the policyholder into a variety of Separate Account investment options. In the Separate Account investment options, the policyholder bears the entire risk and returns of the investment results.

Whole Life (“WL”)			A life insurance policy that is guaranteed to remain in-force for the policyholder’s lifetime, provided the required premiums are paid.

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ACRONYMS

•“AB” or “AllianceBernstein” means AB Holding and ABLP

•“AB Holding” means AllianceBernstein Holding L.P., a Delaware limited partnership

•“AB Holding Units” means units representing assignments of beneficial ownership of limited partnership interests in AB Holding

•“AB Units” means units of limited partnership interests in ABLP

•“ABLP” means AllianceBernstein L.P., a Delaware limited partnership and the operating partnership for the AB business

•“AFS” means available-for-sale

•“AOCI” means accumulated other comprehensive income

•“ASC” means Accounting Standards Codification

•“ASR” means accelerated share repurchase

•“ASU” means Accounting Standards Update

•“AXA” means AXA S.A., a société anonyme organized under the laws of France, and formerly our controlling stockholder

•“BOP” means beginning of period

•“BPs” means basis points

•“CDS” means credit default swaps

•“CLO” means collateralized loan obligation

•“COI” means cost of insurance

•“COLI” means corporate owned life insurance

•“Company” means Equitable Holdings, Inc. with its consolidated subsidiaries

•“CS Life” means Corporate Solutions Life Reinsurance Company, a Delaware corporation and a wholly-owned direct subsidiary of Venerable Insurance and Annuity Company RE

•“CSA” means credit support annex

•“DI” means disability income

•“DOL” means U.S. Department of Labor

•“DSC” means debt service coverage

•“EAFE” means European, Australasia, and Far East

•“EB” means Employee Benefits

•“EFS” means Equitable Financial Services, LLC, a Delaware corporation and a wholly-owned direct subsidiary of Holdings

•“EPS” means earnings per share

•“EIMG” means Equitable Investment Management Group, LLC, a Delaware limited liability company and a wholly-owned indirect subsidiary of Holdings.

•“EIM” means Equitable Investment Management, LLC, a Delaware limited liability company and wholly-owned indirect subsidiary of Holdings.

•“EOP” means end of period

•“Equitable Advisors” means Equitable Advisors, LLC, a Delaware limited liability company, our retail broker/dealer for our retirement and protection businesses and a wholly-owned indirect subsidiary of Holdings

•“Equitable America” means Equitable Financial Life Insurance Company of America (f/k/a MONY Life Insurance Company of America), an Arizona corporation and a wholly-owned indirect subsidiary of Holdings

•“Equitable Financial” means Equitable Financial Life Insurance Company, a New York corporation, a life insurance company and a wholly-owned subsidiary of EFS

•“EQ AZ Life Re” means EQ AZ Life Re Company, an Arizona corporation and a wholly-owned indirect subsidiary of Holdings.

•“ERISA” means Employee Retirement Income Security Act of 1974

•“ESG” means environmental, social and governance

•“ETF” means exchange traded funds

•“ETR” means effective tax rate

•“Exchange Act” means Securities Exchange Act of 1934, as amended

•“FABN” means Funding Agreement Backed Notes Program

•“FASB” means Financial Accounting Standards Board

•“FHLB” means Federal Home Loan Bank

•“FYP” means first year premium and deposits

•“General Partner” means AllianceBernstein Corporation, a Delaware corporation and the general partner of AB Holding and ABLP

•“HFS” means held-for-sale

•“Holdings” means Equitable Holdings, Inc.

•“HTM” means held-to-maturity

•“ISDA Master Agreement” means International Swaps and Derivatives Association Master Agreement

•“IUS” means Investments Under Surveillance

•“LIBOR” means London Interbank Offered Rate

•“LTV” means loan-to-value

•“MD&A” means Management’s Discussion and Analysis of Financial Condition and Results of Operations

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•“MRBs” means market risk benefits

•“MSO” meansMarket Stabilizer Option

•“MTA” means Master Transaction Agreement

•“NAIC” means National Association of Insurance Commissioners

•“NAR” means net amount at risk

•“NAV” means net asset value

•“NLG” means no-lapse guarantee

•“NYDFS” means New York State Department of Financial Services

•“OCI” means other comprehensive income

•“OTC” means over-the-counter

•“PFBL” means profits followed by losses

•“REIT” means real estate investment trusts

•“SCB LLC” means Sanford C. Bernstein & Co., LLC, a registered investment adviser and broker-dealer.

•“SCS” means Structured Capital Strategies

•“SEC” means U.S. Securities and Exchange Commission

•“Series A Preferred Stock” means Holdings’ Series A Fixed Rate Noncumulative Perpetual Preferred Stock

•“Series B Preferred Stock” means Holdings’ Series B Fixed Rate Reset Noncumulative Perpetual Preferred Stock

•“Series C Preferred Stock” means Holdings’ Series C Fixed Rate Reset Noncumulative Perpetual Preferred Stock

•“SIO” means structured investment option

•“SPE” means special purpose entity

•“SVO” means Securities Valuation Office

•“TDRs” means troubled debt restructurings

•“TIPS” means treasury inflation-protected securities

•“U.S. GAAP” means accounting principles generally accepted in the United States of America

•“UL” means universal life

•“ULSG” means universal life products with secondary guarantee

•“Venerable” means Venerable Holdings, Inc.

•“VIAC” means Venerable Insurance and Annuity Company

•“VIE” means variable interest entity

•“VISL” means variable interest-sensitive life

•“VOE” means voting interest entity

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, ~~AXA~~ Equitable Holdings, Inc. has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: ~~June 19, 2018~~November 2, 2023

~~AXA Equitable Holdings, Inc.~~EQUITABLE HOLDINGS, INC.

By:

~~By:~~

/s/ ~~Anders Malmström~~Robin M. Raju

Name:

~~Name:~~

~~Anders Malmström~~Robin M. Raju

Title:

~~Title:~~

~~Senior Executive Vice President~~

~~and~~ Chief Financial Officer
(Principal Financial Officer)

Date: ~~June 19, 2018~~November 2, 2023

By:

/s/ ~~Andrea Nitzan~~William Eckert

Name:

~~Name:~~

~~Andrea Nitzan~~William Eckert

Title:

~~Title:~~

~~Senior Vice President,~~

Chief Accounting Officer ~~and Controller~~
(Principal Accounting Officer)

~~139~~150



Delaware		90-0226248
(State or other jurisdiction of	~~(I.R.S. Employer~~
incorporation or organization)	(I.R.S. Employer Identification No.)



~~1290 Avenue of the Americas, New York, New York~~		~~10104~~
~~(Address of principal executive offices)~~		~~(Zip Code)~~



							Page
PART I					- FINANCIAL INFORMATION

Item 1.	Consolidated Financial Statements
			•	~~Unaudited~~ Consolidated Balance Sheets, ~~March 31, 2018~~September 30, 2023 (Unaudited) and December 31, ~~2017~~2022		4
			•	~~Unaudited~~ Consolidated Statements of Income (Loss), ~~Quarters~~Three and Nine Months Ended ~~March, 31, 2018~~September 30, 2023 and ~~2017~~2022(Unaudited)		65
			•	~~Unaudited~~ Consolidated Statements of Comprehensive Income (Loss), ~~Quarters~~Three and Nine Months Ended ~~March, 31, 2018~~September 30, 2023 and ~~2017~~2022 (Unaudited)		76
			•	~~Unaudited~~ Consolidated Statements of Equity, ~~Quarters~~Three and Nine Months Ended ~~March, 31, 2018~~September 3 0 , 2023 and ~~2017~~2022 (Unaudited)		8
			•	~~Unaudited~~ Consolidated Statements of Cash Flows, ~~Quarters~~Nine Months Ended ~~March 31, 2018~~September 30, 2023 and ~~2017~~2022 (Unaudited)		9
			•	Notes to Consolidated Financial ~~Statements (Unaudited)~~Statements:		11
				Note 1 - Organization		11
				Note 2 - Significant Accounting Policies		1211
				Note 3 - Investments		1922
				Note 4 - ~~Closed Block~~Derivatives		4236
				Note 5 - ~~Insurance Liabilities~~Closed Block		43

			Note 6 - ~~Reinsurance Agreements~~DAC and Other Deferred Assets/Liabilities		4845
				Note 7 - Fair Value Disclosures		4847
				Note 8 - ~~Revenue Recognition~~Liabilities for Future Policyholder Benefits		6364
				Note 9 - Market Risk Benefits		70


			Note 10 - Policyholder Account Balances		72
			Note 11 - Employee Benefit Plans		6378
				Note ~~10 - Share-Based Compensation Programs~~		65
		~~Note 11~~12 - Income Taxes	6678
					~~Note 12 - Related Party Transactions~~		66
				Note 13 - ~~Accumulated Other Comprehensive Income (Loss)~~Equity		6779
				Note 14 - Short-term and Long-term Debt		81
			Note 15 - Redeemable Noncontrolling Interest		82
			Note 16 - Commitments and Contingent Liabilities		6882

			Note 1517 - Business Segment Information		7386
				~~Note 16 - Earnings Per Share~~		76
		~~Note 17 - Revision Tables~~	77
		Note 18 - ~~Subsequent Events~~Insurance Group Statutory Financial Information	8190
			Note 19 - Earnings per Common Share		91


			Note 20 - Held-For-Sale		92
			Note 21 - Reinsurance		93
			Note 22 - Subsequent Events		94
Item 2.			Management’s Discussion and Analysis of Financial Condition and Results of Operations		8295

Item 3.	Quantitative and Qualitative Disclosures About Market Risk			~~132~~141

Item 4.	Controls and Procedures			~~133~~141

PART II					- OTHER INFORMATION

Item 1.	Legal Proceedings			~~135~~142

Item 1A.	Risk Factors			~~135~~142

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds			~~135~~142

Item 3.	Defaults Upon Senior Securities			~~135~~142

Item 4.	Mine Safety Disclosures			~~135~~142

Item 5.	Other Information			~~135~~142

Item 6.	Exhibits			~~137~~143

~~SIGNATURES~~Signatures					~~139~~150



x☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



¨☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



	March 31, 2018		December 31, 2017
	(Unaudited)
	(in millions, except share amounts)

ASSETS
Investments:
Fixed maturities available for sale, at fair value (amortized cost of $43,268 and $45,068)	$	43,484	$	46,941
Mortgage loans on real estate (net of valuation allowance of $7 and $8)	11,333		10,952
Real estate held for production of income⁽¹⁾	52		390
Policy loans	3,776		3,819
Other equity investments⁽¹⁾	1,258		1,392
Trading securities, at fair value	14,919		14,170
Other invested assets⁽¹⁾	4,061		4,118
Total investments	78,883		81,782
Cash and cash equivalents⁽¹⁾	6,091		4,814
Cash and securities segregated, at fair value	1,025		825
Broker-dealer related receivables	2,300		2,158
Deferred policy acquisition costs	6,288		5,969
Goodwill and other intangible assets, net	4,813		4,824
Amounts due from reinsurers	4,953		5,023
Loans to affiliates	885		1,230
GMIB reinsurance contract asset, at fair value	1,734		1,894
Current and deferred tax assets	225		67
Other assets⁽¹⁾	3,239		2,510
Separate Accounts assets	121,858		124,552
Total assets	$	232,294	$	235,648

LIABILITIES
Policyholders’ account balances	$	47,666	$	47,171
Future policy benefits and other policyholders’ liabilities	29,586		30,299
Broker-dealer related payables	466		783
Securities sold under agreements to repurchase	1,904		1,887
Customers related payables	2,549		2,229
Amounts due to reinsurers	1,396		1,436
Short-term and Long-term debt⁽¹⁾	2,373		2,408



	Three Months Ended March 31,
	2018			2017
	(in millions, except earnings per share amounts)
REVENUES
Policy charges and fee income	$	972		$	956
Premiums	279			281
Net derivative gains (losses)	(281		)	(235		)
Net investment income (loss)	591			780
Investment gains (losses), net:
Total other-than-temporary impairment losses	—			(1		)
Other investment gains (losses), net	102			(23		)
Total investment gains (losses), net	102			(24		)
Investment management and service fees	1,055			954
Other income	117			118
Total revenues	2,835			2,830
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	608			1,093
Interest credited to policyholders’ account balances	271			246
Compensation and benefits (includes $40 and $41 of deferred acquisition costs)	620			539
Commissions and distribution related payments (includes $120 and $132 of deferred acquisition costs)	411			395
Interest expense	46			35
Amortization of deferred policy acquisition costs, net (net of capitalization of $160 and $173)	15			(55		)
Other operating costs and expenses	494			744
Total benefits and other deductions	2,465			2,997
Income (loss) from continuing operations, before income taxes	370			(167		)
Income tax (expense) benefit	(79		)	(30		)
Net income (loss)	291			(197		)
Less: net (income) loss attributable to the noncontrolling interest	(123		)	(93		)
Net income (loss) attributable to Holdings	$	168		$	(290	)

EARNINGS PER SHARE
Earnings per share - Common stock
Basic	$	0.30		$	(0.52	)
Diluted	$	0.30		$	(0.52	)
Weighted average common shares outstanding	561			561



	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		OTTI in AOCI ⁽³⁾
	(in millions)
March 31, 2018:
Fixed Maturity Securities:
Public corporate	$	18,513	$	501	$	298	$	18,716	$	—
Private corporate	7,394		117		107		7,404		—
U.S. Treasury, government and agency	14,772		387		506		14,653		—
States and political subdivisions	422		56		1		477		—
Foreign governments	405		23		9		419		—
Residential mortgage-backed⁽¹⁾	614		16		3		627		—
Asset-backed⁽²⁾	675		4		4		675		2
Redeemable preferred stock	473		44		4		513		—
Total at March 31, 2018	$	43,268	$	1,148	$	932	$	43,484	$	2



	March 31, 2018		December 31, 2017
	(in millions)
AFS Securities:
Fixed maturities:
With OTTI loss	$	—	$	2
All other	216		1,871
Equity securities	—		2
Net Unrealized Gains (Losses)	$	216	$	1,875



	Net Unrealized Gains (Losses) on Investments			DAC			Policyholders’ Liabilities			Deferred Income Tax Asset (Liability)			AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)
	(in millions)
Balance, January 1, 2018	$	2		$	—		$	(1	)	$	(7	)	$	(6	)
Net investment gains (losses) arising during the period	—			—			—			—			—
Reclassification adjustment for OTTI losses:
Included in Net income (loss)	(2		)	—			—			—			(2		)
Excluded from Net income (loss)⁽¹⁾	—			—			—			—			—
Impact of net unrealized investment gains (losses) on:
DAC	—			—			—			—			—
Deferred income taxes	—			—			—			7			7
Policyholders’ liabilities	—			—			1			—			1
Balance, March 31, 2018	$	—		$	—		$	—		$	—		$	—
Balance, January 1, 2017	$	19		$	1		$	(10	)	$	(4	)	$	6
Net investment gains (losses) arising during the period	63			—			—			—			63
Reclassification adjustment for OTTI losses:
Included in Net income (loss)	(65		)	—			—			—			(65		)
Excluded from Net income (loss)⁽¹⁾	—			—			—			—			—
Impact of net unrealized investment gains (losses) on:
DAC	—			(4		)	—			—			(4		)
Deferred income taxes	—			—			—			—			—
Policyholders’ liabilities	—			—			6			—			6
Balance, March 31, 2017	$	17		$	(3	)	$	(4	)	$	(4	)	$	6



	Debt Service Coverage Ratio⁽¹⁾
Loan-to-Value Ratio:⁽²⁾	Greater than 2.0x		1.8x to 2.0x		1.5x to 1.8x		1.2x to 1.5x		1.0x to 1.2x		Less than 1.0x		Total Mortgage Loans
	(in millions)
Commercial Mortgage Loans⁽¹⁾
0% - 50%	$	737	$	21	$	321	$	73	$	—	$	—	$	1,152
50% - 70%	4,477		643		1,122		399		178		—		6,819
70% - 90%	169		110		144		307		27		—		757
90% plus	—		—		27		—		—		—		27
Total Commercial Mortgage Loans	$	5,383	$	774	$	1,614	$	779	$	205	$	—	$	8,755
Agricultural Mortgage Loans⁽¹⁾
0% - 50%	$	275	$	153	$	276	$	496	$	321	$	29	$	1,550
50% - 70%	111		46		219		360		228		48		1,012
70% - 90%	—		—		—		23		—		—		23
90% plus	—		—		—		—		—		—		—
Total Agricultural Mortgage Loans	$	386	$	199	$	495	$	879	$	549	$	77	$	2,585
Total Mortgage Loans⁽¹⁾
0% - 50%	$	1,012	$	174	$	597	$	569	$	321	$	29	$	2,702
50% - 70%	4,588		689		1,341		759		406		48		7,831
70% - 90%	169		110		144		330		27		—		780
90% plus	—		—		27		—		—		—		27
Total Mortgage Loans	$	5,769	$	973	$	2,109	$	1,658	$	754	$	77	$	11,340



	30-59 Days		60-89 Days		90 Days or >		Total		Current		Total Financing Receivables		Recorded Investment 90 Days or > and Accruing
							(in millions)
March 31, 2018
Commercial	$	—	$	—	$	27	$	27	$	8,728	$	8,755	$	—
Agricultural	10		5		39		54		2,531		2,585		39
Total Mortgage Loans	$	10	$	5	$	66	$	81	$	11,259	$	11,340	$	39
December 31, 2017
Commercial	$	27	$	—	$	—	$	27	$	8,359	$	8,386	$	—
Agricultural	49		3		22		74		2,500		2,574		22
Total Mortgage Loans	$	76	$	3	$	22	$	101	$	10,859	$	10,960	$	22



	Recorded Investment		Unpaid Principal Balance		Related Allowance			Average Recorded Investment⁽¹⁾		Interest Income Recognized
	(in millions)
March 31, 2018:
With no related allowance recorded:
Commercial mortgage loans - other	$	—	$	—	$	—		$	—	$	—
Agricultural mortgage loans	—		—		—			—		—
Total	$	—	$	—	$	—		$	—	$	—
With related allowance recorded:
Commercial mortgage loans - other	$	27	$	27	$	(7	)	$	27	$	—
Agricultural mortgage loans	—		—		—			—		—
Total	$	27	$	27	$	(7	)	$	27	$	—
December 31, 2017:
With no related allowance recorded:
Commercial mortgage loans - other	$	—	$	—	$	—		$	—	$	—
Agricultural mortgage loans	—		—		—			—		—
Total	$	—	$	—	$	—		$	—	$	—
With related allowance recorded:
Commercial mortgage loans - other	$	27	$	27	$	(8	)	$	27	$	2
Agricultural mortgage loans	—		—		—			—		—
Total	$	27	$	27	$	(8	)	$	27	$	2



	At March 31, 2018						Gains (Losses) Reported In Net Income (Loss) Three Months Ended March 31, 2018
			Fair Value
	Notional Amount		Asset Derivatives		Liability Derivatives
	(in millions)
Freestanding derivatives:
Equity contracts:⁽¹⁾
Futures	$	6,629	$	2	$	1	$	(23	)
Swaps	8,017		255		16		114
Options	23,013		3,350		1,411		(18		)
Interest rate contracts:⁽¹⁾
Swaps	29,331		555		395		(671		)
Futures	24,015		—		—		40
Credit contracts:⁽¹⁾
Credit default swaps	2,136		32		3		—
Other freestanding contracts:⁽¹⁾
Foreign currency contracts	1,781		10		52		(51		)
Margin	—		62		57		—
Collateral	—		17		2,208		—
Embedded derivatives:
GMIB reinsurance contracts⁽⁶⁾	—		1,734		—		(159		)
GMxB derivative features liability^(3,6)	—		—		3,977		460
SCS, SIO, MSO and IUL indexed features^(5,6)	—		—		1,683		27
Net derivative investment gains (loss)							(281		)
Cross currency swaps ^(2,4)	—		—		—		9
Total	$	94,922	$	6,017	$	9,803	$	(272	)



	At December 31, 2017						Gains (Losses) Reported In Net Income (Loss) Three Months Ended March 31, 2017
			Fair Value
	Notional Amount		Asset Derivatives		Liability Derivatives
	(in millions)
Freestanding derivatives:
Equity contracts:⁽¹⁾
Futures	$	6,716	$	1	$	2	$	(396	)
Swaps	7,623		4		201		(405		)
Options	22,223		3,456		1,457		318
Interest rate contracts:⁽¹⁾
Swaps	26,769		604		193		143
Futures	20,675		—		—		(19		)
Credit contracts:⁽¹⁾
Credit default swaps	2,131		35		3		6
Other freestanding contracts:⁽¹⁾
Foreign currency contracts	1,423		19		10		(1		)
Margin	—		24		4		—
Collateral	—		4		2,123		—
Embedded derivatives:
GMIB reinsurance contracts⁽⁶⁾	—		1,894		—		(71		)
GMxB derivative features liability^(3,6)	—		—		4,358		507
SCS, SIO, MSO and IUL indexed features^(5,6)	—		—		1,786		(317		)
Net derivative investment gains (loss)							(235		)
Cross currency swaps^(2,4)	354		5		—		(7		)
Total	$	87,914	$	6,046	$	10,137	$	(242	)



	Gross Amounts Recognized		Gross Amounts Offset in the Balance Sheets		Net Amounts Presented in the Balance Sheets
	(in millions)
ASSETS⁽¹⁾
Description
Derivatives:
Equity contracts	$	3,606	$	1,429	$	2,177
Interest rate contracts	555		395		160
Credit contracts	32		3		29
Currency	10		52		(42		)
Collateral	17		2,208		(2,191		)
Margin	62		57		5
Total Derivatives, subject to an ISDA Master Agreement	4,282		4,144		138
Other financial instruments	3,923		—		3,923
Other invested assets	$	8,205	$	4,144	$	4,061
LIABILITIES⁽²⁾
Description
Derivatives:
Equity contracts	$	1,429	$	1,429	$	—
Interest rate contracts	395		395		—
Credit contracts	3		3		—
Currency	52		52		—
Collateral	2,208		2,208		—
Margin	57		57		—
Total Derivatives, subject to an ISDA Master Agreement	4,144		4,144		—
Other financial liabilities	4,342		—		4,342
Other liabilities	$	8,486	$	4,144	$	4,342
Securities sold under agreement to repurchase⁽³⁾	$	1,897	$	—	$	1,897



	Net Amounts Presented in the Balance Sheets		Collateral (Received)/Held
	Net Amounts Presented in the Balance Sheets		Financial Instruments			Cash			Net Amounts
	(in millions)
Assets⁽¹⁾
Total derivatives	$	2,324	$	—		$	(2,186	)	$	138
Other financial instruments	3,923		—			—			3,923
Other invested assets	$	6,247	$	—		$	(2,186	)	$	4,061
Liabilities:⁽²⁾
Securities sold under agreement to repurchase^(3)(4)(5)	$	1,897	$	(1,923	)	$	—		$	(26	)



	At March 31, 2018
	Remaining Contractual Maturity of the Agreements
	Overnight and Continuous		Up to 30 days		30–90 days		Greater Than 90 days		Total
	(in millions)
Securities sold under agreement to repurchase⁽¹⁾
U.S. Treasury and agency securities	$	—	$	1,897	$	—	$	—	$	1,897
Total	$	—	$	1,897	$	—	$	—	$	1,897



	GMDB			GMIB			Total
	(in millions)
Balance at January 1, 2018	$	4,085		$	4,800		$	8,885
Paid guarantee benefits	(101		)	(32		)	(133		)
Other changes in reserve	97			(136		)	(39		)
Balance at March 31, 2018	$	4,081		$	4,632		$	8,713
Balance at January 1, 2017	$	3,170		$	3,868		$	7,038
Paid guarantee benefits	(89		)	(32		)	(121		)
Other changes in reserve	187			1,919			2,106
Balance at March 31, 2017	$	3,268		$	5,755		$	9,023



	Return of Premium			Ratchet			Roll-Up			Combo			Total
	(Dollars in millions)
GMDB:
Account values invested in:
General Account	$	13,848		$	107		$	64		$	194		$	14,213
Separate Accounts	$	45,136		$	9,319		$	3,381		$	34,668		$	92,504
Net amount at risk, gross	$	186		$	117		$	2,016		$	16,388		$	18,707
Net amount at risk, net of amounts reinsured	$	186		$	111		$	1,378		$	16,388		$	18,063
Average attained age of policyholders	51			67			73			68			55
Percentage of policyholders over age 70	9.7		%	40.9		%	63.7		%	47.4		%	18.3		%
Range of contractually specified interest rates	N/A			N/A			3%-6%			3%-6.5%			3%-6.5%
GMIB:
Account values invested in:
General Account	N/A			N/A			$	24		$	285		$	309
Separate Accounts	N/A			N/A			$	20,855		$	39,604		$	60,459
Net amount at risk, gross	N/A			N/A			$	883		$	6,322		$	7,205
Net amount at risk, net of amounts reinsured	N/A			N/A			$	268		$	5,738		$	6,006
Average attained age of policyholders	N/A			N/A			70			69			69
Weighted average years remaining until annuitization	N/A			N/A			1.7			0.7			0.8
Range of contractually specified interest rates	N/A			N/A			3%-6%			3%-6.5%			3%-6.5%



	March 31, 2018		December 31, 2017 (1)
	(in millions)
GMDB:
Equity	$	40,678	$	41,658
Fixed income	5,384		5,469
Balanced	45,485		46,577
Other	957		968
Total	$	92,504	$	94,672
GMIB:
Equity	$	19,156	$	19,928
Fixed income	3,074		3,150
Balanced	37,918		38,890
Other	311		318
Total	$	60,459	$	62,286



	Direct Liability⁽¹⁾
	(in millions)
Balance at January 1, 2018	$	686
Paid Guaranteed Benefits	(8		)
Other changes in reserves	26
Balance at March 31, 2018	$	704
Balance at January 1, 2017	$	1,307
Other changes in reserves	4
Balance at March 31, 2017	$	1,311



	Corporate			State and Political Sub- divisions			Commercial Mortgage- backed			Asset- backed
	(in millions)
Balance, January 1, 2018	$	1,150		$	40		$	—		$	541
Total gains (losses), realized and unrealized, included in:
Income (loss) as:
Net investment income (loss)	1			—			—			—
Investment gains (losses), net	—			—			—			—
Subtotal	1			—			—			—
Other comprehensive income (loss)	(21		)	(1		)	—			—
Purchases	189			—			—			—
Sales	(117		)	—			—			(1		)
Settlements	—			—			—			—
Transfers into Level 3⁽¹⁾	67			—			—			—
Transfers out of Level 3⁽¹⁾	(16		)	—			—			—
Balance, March 31, 2018	$	1,253		$	39		$	—		$	540
Balance, January 1, 2017	$	857		$	42		$	373		$	120
Total gains (losses), realized and unrealized, included in:
Income (loss) as:
Net investment income (loss)	1			—			—			—
Investment gains (losses), net	—			—			(23		)	—
Subtotal	1			—			(23		)	—
Other comprehensive income (loss)	45			—			25			5
Purchases	171			—			—			195
Sales	(67		)	—			(35		)	(3		)
Transfers into Level 3⁽¹⁾	18			—			—			6
Transfers out of Level 3⁽¹⁾	—			—			—			—
Balance, March 31, 2017	$	1,025		$	42		$	340		$	323



	Redeemable Preferred Stock			Other Equity Investments⁽²⁾			GMIB Reinsurance Contract Asset			Separate Accounts Assets			GMxB derivative features liability			Contingent Payment Arrangement
	(in millions)
Balance, January 1, 2018	$	1		$	99		$	1,894		$	349		$	(4,358	)	$	(15	)
Total gains (losses), realized and unrealized, included in:
Income (loss) as:
Net investment income (loss)	—			—			—			—			—			—
Investment gains (losses), net	—			—			—			7			—			—
Net derivative gains (losses)	—			—			(159		)	—			460			—
Subtotal	—			—			(159		)	7			460			—
Other comprehensive income (loss)	—			1			—			—			—			—
Purchases⁽²⁾	—			4			10			3			(84		)	—
Sales⁽³⁾	(1		)	—			(11		)	(1		)	5			—
Settlements⁽⁴⁾	—			—			—			(1		)	—			1
Activity related to consolidated VIEs	—			1			—			—			—			—
Transfers into Level 3⁽¹⁾	—			5			—			—			—			—
Transfers out of Level 3⁽¹⁾	—			—			—			—			—			—
Balance, March 31, 2018	$	—		$	110		$	1,734		$	357		$	(3,977	)	$	(14	)
Balance, January 1, 2017	$	1		$	88		$	1,735		$	313		$	(5,580	)	$	(25	)
Total gains (losses), realized and unrealized, included in:
Income (loss) as:
Net investment income (loss)	—			—			—			—			—			—
Investment gains (losses), net	—			(9		)	—			10			—			—
Net derivative gains (losses)	—			—			(71		)				507			—
Subtotal	—			(9		)	(71		)	10			507			—
Other comprehensive income (loss)	—			—			—			—			—			—
Purchases⁽²⁾	—			4			9			3			(81		)	—
Sales⁽³⁾	—			(1		)	(14		)	(1		)	8			—
Settlements⁽⁴⁾	—						—			(1		)	—			1
Activity related to consolidated VIEs	—			(9		)	—			—			—			—
Transfers into Level 3⁽¹⁾	—			1			—			1			—			—
Transfers out of Level 3⁽¹⁾	—						—			—			—			—
Balance, March 31, 2017	$	1		$	74		$	1,659		$	325		$	(5,146	)	$	(24	)



	Income (Loss)
	Investment Gains (Losses), Net		Net Derivative Gains (losses)			OCI
	(in millions)
Level 3 Instruments
First Quarter of 2018
Held at March 31, 2018:
Change in unrealized gains (losses):
Fixed maturities, available-for-sale:
Corporate	$	—	$	—		$	(19	)
State and political subdivisions	—		—			(1		)
Asset-backed	—		—			—
Subtotal	$	—	$	—		$	(20	)
GMIB reinsurance contracts	—		(159		)	—
Separate Accounts’ assets⁽¹⁾	7		—			—
GMxB derivative features’ liability	—		460			—
Total	$	7	$	301		$	(20	)
Level 3 Instruments
First Quarter of 2017
Held at March 31, 2017:
Change in unrealized gains (losses):
Fixed maturities, available-for-sale:
Corporate	$	—	$	—		$	45
Commercial mortgage-backed	—		—			13
Asset-backed	—		—			5
Subtotal	$	—	$	—		$	63
GMIB reinsurance contracts	—		(71		)	—
Separate Accounts’ assets⁽¹⁾	10		—			—
GMxB derivative features’ liability	—		507			—
Total	$	10	$	436		$	63



	Carrying Value		Fair Value
	Carrying Value		Level 1		Level 2		Level 3		Total
	(in millions)
March 31, 2018:
Mortgage loans on real estate	$	11,333	$	—	$	—	$	11,128	$	11,128
Loans to affiliates	885		—		885		—		885
Policyholders’ liabilities: Investment contracts	2,222		—		—		2,283		2,283
FHLBNY Funding Agreements	3,014		—		2,962		—		2,962
Short term and long-term debt	2,373		—		2,449		—		2,449
Loans from affiliates	2,530		—		2,530		—		2,530
Policy loans	3,776		—		—		4,330		4,330
Separate Account Liabilities	7,647		—		—		7,647		7,647
December 31, 2017:
Mortgage loans on real estate	$	10,952	$	—	$	—	$	10,912	$	10,912
Loans to affiliates	1,230		—		1,230		—		1,230
Policyholders’ liabilities: Investment contracts	2,224		—		—		2,329		2,329
FHLBNY Funding Agreements	3,014		—		3,020		—		3,020
Short term and long-term debt	2,408		—		2,500		—		2,500
Loans from affiliates	3,622		—		3,622		—		3,622
Policy loans	3,819		—		—		4,754		4,754
Separate Account Liabilities	7,537		—		—		7,537		7,537



	March 31,
	2018			2017
	(in millions)
Unrealized gains (losses) on investments	$	(130	)	$	244
Foreign currency translation adjustments	(40		)	(69		)
Defined benefit pension plans	(822		)	(1,030		)
Total accumulated other comprehensive income (loss)	(992		)	(855		)
Less: Accumulated other comprehensive (income) loss attributable to noncontrolling interest	46			64
Accumulated other comprehensive income (loss) attributable to Holdings	$	(946	)	$	(791	)



	Three Months Ended March 31,			Twelve Months Ended December 31,
	2018			2017
	(in millions)
Severance
Balance, beginning of year	$	23		$	22
Additions	7			17
Cash payments	(3		)	(14		)
Other reductions	—			(2		)
Balance, end of Year	$	27		$	23



	Outstanding balance at end of period		Maturity of Outstanding balance	Issued during the period		Repaid during the period
March 31, 2018:	(in millions)
Short-term FHLBNY funding agreements	$	500	less than one month	$	1,500	$	1,500
Long-term FHLBNY funding agreements	1,417		less than 4 years	—		—
	204		Less than 5 years	—		—
	879		greater than five years	—		—
Total long-term funding agreements	2,500			—		—
Total FHLBNY funding agreements at March 31, 2018	$	3,000		$	1,500	$	1,500
December 31, 2017:
Short-term FHLBNY funding agreements	$	500	Less than one month	$	6,000	$	6,000
Long-term FHLBNY funding agreements	1,244		Less than 4 years	324		—
	377		Less than 5 years	303		—
	879		Greater than five years	135		—
Total long-term funding agreements	2,500			762		—
Total FHLBNY funding agreements at December 31, 2017	$	3,000		$	6,762	$	6,000



		Six Months Ended June 30, 2017
		As Previously Reported		Impact of Revisions			As Revised
	(in millions)
Consolidated Statement of Income (Loss):
Revenues:
Net derivative gains (losses)		$	528	$	(34	)	$	494
Total revenues		6,746		$	(34	)	6,712
Benefits and other deductions:
Interest credited to policyholders’ account balances		$	522	$	(34	)	$	488
Total benefits and other deductions		6,299		$	(34	)	6,265



		Nine Months Ended September 30, 2017
		As Previously Reported		Impact of Revisions			As Revised
	(in millions)
Consolidated Statement of Income (Loss):
Revenues:
Net derivative gains (losses)		$	172	$	(44	)	$	128
Total revenues		9,529		$	(44	)	9,485
Benefits and other deductions:
Interest credited to Policyholders’ account balances		$	787	$	(44	)	$	743
Total benefits and other deductions		9,070		$	(44	)	9,026



	December 31, 2016
	As Previously Reported			Impact of Revisions				As Revised
	(in millions)
Consolidated Statement of Income (Loss):
Revenues:
Net derivative gains (losses)	$	(1,722	)	$	(121	)	—	$	(1,843	)
Total revenues	11,922			$	(121	)		11,801
Benefits and other deductions:
Interest credited to Policyholder’s account balances	1,091			$	(121	)		970
Total benefits and other deductions	9,868			$	(121	)		9,747



	March 31, 2018			March 31, 2017
	(in millions)
Balance as of beginning of period	$	103,423		$	93,604
Gross premiums	1,787			2,010
Surrenders, withdrawals and benefits	(2,249		)	(1,797		)
Net flows	(462		)	213
Investment performance, interest credited and policy charges	(1,171		)	2,862
Balance as of end of period	$	101,790		$	96,679