Financial Performance - For Q1 2023, the company reported a net loss of $93 million, a significant decline from a net income of $156 million in the same quarter last year, primarily due to unrealized mark-to-market losses on investments and embedded derivatives [12]. - Net income for the period was a loss of $93 million, down from a profit of $156 million in the first quarter of 2022 [24]. - Total revenues were $1,203 million, compared to $278 million in the same period of 2022, representing a significant increase [24]. - Cash flows from operating activities were $198 million, up from $77 million in the first quarter of 2022 [30]. - The company reported a total change in the period of $92 million, driven by net income and other adjustments [60]. Premiums and Claims - Net premiums for the quarter reached $800 million, a substantial increase from $109 million in the prior year quarter, largely driven by $625 million in contributions from direct insurance premiums from American National, acquired in May 2022 [12]. - Claims and policyholder benefits increased to $742 million in the quarter, compared to $105 million in the prior year quarter, correlating with the rise in premium revenues from American National [13]. - Claims incurred and benefits paid for the same period were $840 million, compared to $86 million in 2022, reflecting an increase of 876.7% [184]. Operating Expenses - Operating expenses surged to $176 million in the current quarter from $17 million in the prior year quarter, mainly due to the acquisition of American National and increased personnel and professional services [13]. - Operating expenses were $176 million, compared to $17 million in the same period of 2022, indicating a substantial rise [24]. Investment Income and Losses - Net investment income was $400 million for the quarter, up from $56 million in the prior year quarter, reflecting growth in the investment portfolio and capital redeployed in recent transactions [12]. - The company reported net losses on investments and derivatives of $121 million, compared to gains of $111 million in the same period of 2022 [30]. - Total investment-related losses for the three months ended March 31, 2023, amounted to $(106) million, compared to gains of $28 million in the same period of 2022 [134]. Assets and Liabilities - Total assets increased to $44,951 million as of March 31, 2023, compared to $43,450 million at the end of 2022, reflecting a growth of approximately 3.5% [54]. - Policyholder liabilities increased by $461 million, contrasting with a decrease of $7 million in the previous year [30]. - The total liabilities related to policyholders' account balance as of March 31, 2023, were $6,057 million, unchanged from the previous period [184]. Equity and Retained Earnings - The company recorded a $71 million decrease to retained earnings as of December 31, 2022, due to the transition to GAAP accounting standards [7]. - The transition from IFRS to GAAP resulted in a $138 million decrease to retained earnings and a corresponding increase to accumulated other comprehensive income related to the reclassification of equity and debt securities [8]. - The company’s total equity as of March 31, 2023, was $1.828 billion, reflecting changes in comprehensive income and other adjustments during the period [19]. Accounting Standards and Changes - The company adopted LDTI effective January 1, 2023, impacting the measurement and disclosures of insurance liabilities and deferred acquisition costs [52]. - The company has adopted new accounting standards, including ASU 2020-04, which addresses the effects of reference rate reform on financial reporting [111]. Investments and Securities - The fair value of available-for-sale fixed maturity securities totaled $16,565 million as of March 31, 2023, with $14,616 million classified as Level 2 measurements [145]. - The total investments in available-for-sale fixed maturity securities amounted to $17,352 million with a carrying value of $16,565 million as of March 31, 2023 [111]. - The company held $5,902 million in mortgage loans on real estate as of December 31, 2022, with a non-accrual amount of $27 million [93]. Derivatives and Risk Management - The company manages foreign currency exposure and other market risks using derivative financial instruments, including cross currency swaps and interest rate swaps [151]. - The notional amount of cross currency swaps was $17 million in 2023, while interest rate swaps had a notional amount of $12 million [153].
Brookfield Reinsurance .(BNRE) - 2023 Q1 - Quarterly Report