What changed in this filing

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Item 1. Financial Statements

2022-08-05 compared with 2022-05-10 · 344 added, 132 removed, 1361 unchanged (26% of the section changed)

2 unchanged sentences

Interim Condensed Consolidated Balance Sheets

March 31, 2022 (Unaudited) and December 31, 2021

June 30, 2022 (Unaudited) and December 31, 2021

(In millions, except share and per share data)

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Fixed maturity securities available-for-sale, at estimated fair value (amortized cost:

16 unchanged sentences

Deferred policy acquisition costs and value of business acquired 5,434 5,377

Current income tax recoverable 18 —

Deferred income tax asset 471 —

Other assets 445 482

36 unchanged sentences

Interim Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

For the Three Months Ended March 31, 2022 and 2021 (Unaudited)

For the Three Months and Six Months Ended June 30, 2022 and 2021 (Unaudited)

(In millions, except per share data)

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Premiums $ 167 $ 162 $ 333 $ 346

15 unchanged sentences

Net income (loss) attributable to Brighthouse Financial, Inc.

983 31 1,623 ( 554 )

Preferred stock dividends 26 21 53 46

10 unchanged sentences

Interim Condensed Consolidated Statements of Equity

For the Three Months Ended March 31, 2022 and 2021 (Unaudited)

For the Three Months and Six Months Ended June 30, 2022 and 2021 (Unaudited)

(In millions)

16 unchanged sentences

Balance at March 31, 2022 — 1 14,133 ( 2 ) ( 1,681 ) 363 12,814 65 12,879

Treasury stock acquired in connection with share repurchases

( 132 ) ( 132 ) ( 132 )

Share-based compensation

Dividends on preferred stock

( 26 ) ( 26 ) ( 26 )

Change in noncontrolling interests

Net income (loss)

983 983 — 983

Other comprehensive income (loss), net of income tax

( 3,454 ) ( 3,454 ) ( 3,454 )

Balance at June 30, 2022 $ — $ 1 $ 14,113 $ 981 $ ( 1,813 ) $ ( 3,091 ) $ 10,191 $ 65 $ 10,256

Preferred Stock Common Stock Additional Paid-in Capital Retained Earnings (Deficit) Treasury Stock at Cost Accumulated

14 unchanged sentences

Balance at March 31, 2021 — 1 13,858 ( 1,119 ) ( 1,112 ) 3,389 15,017 65 15,082

Treasury stock acquired in connection with share repurchases

( 124 ) ( 124 ) ( 124 )

Share-based compensation

Dividends on preferred stock

( 21 ) ( 21 ) ( 21 )

Change in noncontrolling interests

Net income (loss)

Other comprehensive income (loss), net of income tax

1,207 1,207 1,207

Balance at June 30, 2021 $ — $ 1 $ 13,842 $ ( 1,088 ) $ ( 1,236 ) $ 4,596 $ 16,115 $ 65 $ 16,180

See accompanying notes to the interim condensed consolidated financial statements.

1 unchanged sentence

Interim Condensed Consolidated Statements of Cash Flows

For the Three Months Ended March 31, 2022 and 2021 (Unaudited)

For the Six Months Ended June 30, 2022 and 2021 (Unaudited)

(In millions)

Three Months Ended

Six Months Ended

Net cash provided by (used in) operating activities $ 18 $ 69

64 unchanged sentences

The Company considers the applicability and impact of all ASUs.

There were no significant ASUs adopted during the period ended March 31, 2022.

There were no significant ASUs adopted during the period ended June 30, 2022.

Future Adoption of New Accounting Pronouncements

21 unchanged sentences

The Company is, therefore, unable to currently estimate the ultimate impact of the new guidance on the financial statements;

however, at prevailing interest rate levels at the end of 2021, the Company expects the new guidance, upon adoption, would likely result in a material decrease in stockholders’ equity.

however, at prevailing interest rate levels at December 31, 2021, the Company expects the new guidance, upon adoption, would likely result in a material decrease in stockholders’ equity.

Based on prevailing interest rate levels at June 30, 2022, while still anticipated to be material, the impact is expected to be less significant compared to prevailing interest rates at December 31, 2021.

The Company has made significant progress toward adopting the new guidance, including updating systems, validating computations, establishing proper controls, finalizing accounting policies and developing disclosures.

Segment Information

4 unchanged sentences

The Run-off segment consists of products that are no longer actively sold and are separately managed, including universal life with secondary guarantees, structured settlements, pension risk transfer contracts, certain company-owned life insurance policies and certain funding agreements.

Corporate & Other

Corporate & Other contains the excess capital not allocated to the segments and interest expense related to the Company’s outstanding debt, as well as expenses associated with certain legal proceedings and income tax audit issues.

Corporate & Other also includes long-term care and workers’ compensation business reinsured through 100% quota share reinsurance agreements, activities related to funding agreements associated with the Company’s institutional spread margin business, as well as direct-to-consumer life insurance that is no longer actively sold.

Brighthouse Financial, Inc.

1 unchanged sentence

Segment Information (continued)

Corporate & Other

Financial Measures and Segment Accounting Policies

24 unchanged sentences

Operating results by segment, as well as Corporate & Other, were as follows:

Three Months Ended March 31, 2022

Three Months Ended June 30, 2022

Annuities Life Run-off Corporate & Other Total

14 unchanged sentences

Interest expense $ — $ — $ — $ 38

Three Months Ended March 31, 2021

Three Months Ended June 30, 2021

Annuities Life Run-off Corporate & Other Total

17 unchanged sentences

Segment Information (continued)

Six Months Ended June 30, 2022

Annuities Life Run-off Corporate & Other Total

(In millions)

Pre-tax adjusted earnings $ 631 $ 60 $ ( 187 ) $ ( 69 ) $ 435

Provision for income tax expense (benefit) 116 11 ( 39 ) ( 26 ) 62

Post-tax adjusted earnings 515 49 ( 148 ) ( 43 ) 373

Net income (loss) attributable to noncontrolling interests — — — 2 2

Preferred stock dividends — — — 53 53

Adjusted earnings $ 515 $ 49 $ ( 148 ) $ ( 98 ) 318

Adjustments for:

Net investment gains (losses) ( 134 )

Net derivative gains (losses) 2,246

Other adjustments to net income (loss) ( 527 )

Provision for income tax (expense) benefit ( 333 )

Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders

Interest revenue $ 1,101 $ 265 $ 751 $ 110

Interest expense $ — $ — $ — $ 76

Six Months Ended June 30, 2021

Annuities Life Run-off Corporate & Other Total

(In millions)

Pre-tax adjusted earnings $ 831 $ 137 $ 225 $ ( 143 ) $ 1,050

Provision for income tax expense (benefit) 157 27 27 ( 29 ) 182

Post-tax adjusted earnings 674 110 198 ( 114 ) 868

Net income (loss) attributable to noncontrolling interests — — — 2 2

Preferred stock dividends — — — 46 46

Adjusted earnings $ 674 $ 110 $ 198 $ ( 162 ) 820

Adjustments for:

Net investment gains (losses) ( 20 )

Net derivative gains (losses) ( 2,188 )

Other adjustments to net income (loss) 411

Provision for income tax (expense) benefit 377

Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders

Interest revenue $ 1,083 $ 334 $ 961 $ 31

Interest expense $ — $ — $ — $ 81

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Segment Information (continued)

Total revenues by segment, as well as Corporate & Other, were as follows:

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

(In millions)

Annuities $ 1,207 $ 1,257 $ 2,479 $ 2,555

Life 276 383 616 793

Run-off 514 662 1,076 1,290

3 unchanged sentences

Total assets by segment, as well as Corporate & Other, were as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

(In millions)

8 unchanged sentences

Information regarding the Company’s guarantee exposure was as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Event of Death At

12 unchanged sentences

Insurance (continued)

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Secondary Guarantees

28 unchanged sentences

Fixed maturity securities by sector were as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Cost Allowance for Credit Losses Gross Unrealized Estimated

12 unchanged sentences

Total fixed maturity securities $ 83,613 $ 4 $ 1,682 $ 6,685 $ 78,606 $ 79,246 $ 11 $ 8,806 $ 459 $ 87,582

The Company held non-income producing fixed maturity securities with an estimated fair value of $ 44 million and $ 3 million at March 31, 2022 and December 31, 2021, respectively.

The Company held non-income producing fixed maturity securities with an estimated fair value of $ 20 million and $ 3 million at June 30, 2022 and December 31, 2021, respectively.

Maturities of Fixed Maturity Securities

The amortized cost and estimated fair value of fixed maturity securities, by contractual maturity date, were as follows at March 31, 2022:

The amortized cost and estimated fair value of fixed maturity securities, by contractual maturity date, were as follows at June 30, 2022:

Year or Less Due After One

17 unchanged sentences

The estimated fair value and gross unrealized losses of fixed maturity securities in an unrealized loss position, by sector and by length of time that the securities have been in a continuous unrealized loss position, were as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Less than 12 Months 12 Months or Greater Less than 12 Months 12 Months or Greater

33 unchanged sentences

An allowance for credit losses is not estimated on an accrued interest receivable, rather receivable balances 90-days past due are deemed uncollectible and are written off with a corresponding reduction to net investment income.

The accrued interest receivable on fixed maturity securities totaled $ 580 million and $ 534 million at March 31, 2022 and December 31, 2021, respectively, and is included in accrued investment income.

The accrued interest receivable on fixed maturity securities totaled $ 557 million and $ 534 million at June 30, 2022 and December 31, 2021, respectively, and is included in accrued investment income.

Brighthouse Financial, Inc.

9 unchanged sentences

Current Period Evaluation

Based on the Company’s current evaluation of its fixed maturity securities in an unrealized loss position and the current intent or requirement to sell, the Company recorded an allowance for credit losses of $ 11 million, relating to eight securities at March 31, 2022.

Based on the Company’s current evaluation of its fixed maturity securities in an unrealized loss position and the current intent or requirement to sell, the Company recorded an allowance for credit losses of $ 4 million, relating to five securities at June 30, 2022.

Management concluded that for all other fixed maturity securities in an unrealized loss position, the unrealized loss was not due to issuer-specific credit-related factors and as a result was recognized in OCI.

2 unchanged sentences

Allowance for Credit Losses for Fixed Maturity Securities

The allowance for credit losses for fixed maturity securities was $ 11 million at both March 31, 2022 and December 31, 2021.

For both the three months ended March 31, 2022 and 2021, the change in the allowance for fixed maturity securities by sector was immaterial.

The Company recorded total write-offs of $ 2 million for the three months ended March 31, 2022.

The Company did no t record any write-offs for the three months ended March 31, 2021.

The allowance for credit losses for fixed maturity securities was $ 4 million and $ 11 million at June 30, 2022 and December 31, 2021, respectively.

For both the six months ended June 30, 2022 and 2021, the change in the allowance for fixed maturity securities by sector was immaterial.

The Company recorded total write-offs of $ 10 million for the six months ended June 30, 2022.

The Company did no t record any write-offs for the six months ended June 30, 2021.

Mortgage Loans

1 unchanged sentence

Mortgage loans are summarized as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Total Carrying

7 unchanged sentences

_______________

(1) Purchases of mortgage loans from third parties were $ 840 million and $ 178 million for the three months ended March 31, 2022 and 2021, respectively, and were primarily comprised of residential mortgage loans.

(1) Purchases of mortgage loans from third parties were $ 415 million and $ 1.3 billion for the three months and six months ended June 30, 2022, respectively, and $ 621 million and $ 799 million for the three months and six months ended June 30, 2021, respectively, and were primarily comprised of residential mortgage loans.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

Allowance for Credit Losses for Mortgage Loans

2 unchanged sentences

The loan balance, or a portion of the loan balance, is written-off against the allowance when management believes this amount is uncollectible.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

Accrued interest receivables are presented separate from the amortized cost basis of mortgage loans.

1 unchanged sentence

For mortgage loans that are granted payment deferrals due to the COVID-19 pandemic, interest continues to be accrued during the deferral period if the loan was less than 30 days past due at December 31, 2019 and performing at the onset of the pandemic.

Accrued interest on COVID-19 pandemic impacted loans was not significant at both March 31, 2022 and December 31, 2021.

The accrued interest receivable on mortgage loans is included in accrued investment income and totaled $ 93 million and $ 95 million at March 31, 2022 and December 31, 2021, respectively.

Accrued interest on COVID-19 pandemic impacted loans was not significant at both June 30, 2022 and December 31, 2021.

The accrued interest receivable on mortgage loans is included in accrued investment income and totaled $ 99 million and $ 95 million at June 30, 2022 and December 31, 2021, respectively.

The allowance for credit losses is estimated using relevant available information, from internal and external sources, relating to past events, current conditions, and a reasonable and supportable forecast.

16 unchanged sentences

Any subsequent PCD mortgage loan allowance for credit losses is evaluated in a manner similar to the process described above for each of the three portfolio segments.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

Rollforward of the Allowance for Credit Losses for Mortgage Loans by Portfolio Segment

2 unchanged sentences

(In millions)

Three Months Ended March 31, 2022

Six Months Ended June 30, 2022

Balance, beginning of period $ 67 $ 12 $ 44 $ 123

Current period provision — 3 — 3

Charge-offs, net of recoveries ( 23 ) — — ( 23 )

Balance, end of period $ 44 $ 15 $ 44 $ 103

Three Months Ended March 31, 2021

Six Months Ended June 30, 2021

Balance, beginning of period $ 44 $ 15 $ 35 $ 94

1 unchanged sentence

Balance, end of period $ 47 $ 13 $ 37 $ 97

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

Credit Quality of Mortgage Loans by Portfolio Segment

2 unchanged sentences

(In millions)

March 31, 2022

June 30, 2022

Commercial mortgage loans

9 unchanged sentences

65% to 75% 60 97 76 61 1 17 312

Greater than 80% — — — — 1 — 1

Total agricultural mortgage loans 366 1,255 486 557 654 826 4,144

4 unchanged sentences

Total $ 2,356 $ 6,235 $ 1,123 $ 2,660 $ 2,272 $ 6,965 $ 21,611

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

2021 2020 2019 2018 2017 Prior Total

18 unchanged sentences

Total $ 5,793 $ 1,349 $ 2,821 $ 2,384 $ 1,199 $ 6,427 $ 19,973

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

The loan-to-value ratio is a measure commonly used to assess the quality of commercial and agricultural mortgage loans.

5 unchanged sentences

The amortized cost of commercial mortgage loans by debt-service coverage ratio was as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Amortized Cost % of

9 unchanged sentences

A debt-service coverage ratio greater than 1.00 times indicates an excess of net operating income over the debt-service payments.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

Past Due Mortgage Loans by Portfolio Segment

The Company has a high-quality, well-performing mortgage loan portfolio, with over 99 % of all mortgage loans classified as performing at both March 31, 2022 and December 31, 2021.

The Company has a high-quality, well-performing mortgage loan portfolio, with over 99 % of all mortgage loans classified as performing at both June 30, 2022 and December 31, 2021.

Delinquency is defined consistent with industry practice, when mortgage loans are past due as follows:

2 unchanged sentences

To the extent a payment deferral is agreed to with a borrower, in response to the COVID-19 pandemic, the past due status of the impacted loans during the forbearance period is locked-in as of March 1, 2020, which reflects the date on which the COVID-19 pandemic began to affect the borrower’s ability to make payments.

At March 31, 2022 and December 31, 2021, $ 31 million and $ 30 million, respectively, of the COVID-19 pandemic modified loans were classified as delinquent.

At June 30, 2022 and December 31, 2021, $ 26 million and $ 30 million, respectively, of the COVID-19 pandemic modified loans were classified as delinquent.

The aging of the amortized cost of past due mortgage loans by portfolio segment was as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Commercial Agricultural Residential Total Commercial Agricultural Residential Total

6 unchanged sentences

$ 13,046 $ 4,144 $ 4,421 $ 21,611 $ 12,187 $ 4,163 $ 3,623 $ 19,973

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

Mortgage Loans in Nonaccrual Status by Portfolio Segment

2 unchanged sentences

A COVID-19 pandemic modified loan is only reported as a nonaccrual asset in the event a borrower declares bankruptcy, the borrower experiences significant credit deterioration such that the Company does not expect to collect all principal and interest due, or the loan was 90 days past due at the onset of the pandemic.

At March 31, 2022 and December 31, 2021, $ 31 million and $ 30 million, respectively, of the COVID-19 pandemic modified loans were in nonaccrual status.

The amortized cost of mortgage loans in a nonaccrual status by portfolio segment were as follows at:

At June 30, 2022 and December 31, 2021, $ 26 million and $ 30 million, respectively, of the COVID-19 pandemic modified loans were in nonaccrual status.

The amortized cost of mortgage loans in a nonaccrual status by portfolio segment was as follows at:

Commercial Agricultural Residential Total

(In millions)

March 31, 2022

June 30, 2022

$ 23 $ — $ 58 $ 81

1 unchanged sentence

$ — $ — $ 59 $ 59

_______________

(1) All residential mortgage loans in nonaccrual status had an allowance for credit losses at both March 31, 2022 and December 31, 2021.

Current period investment income on mortgage loans in nonaccrual status was less than $ 1 million for both the three months ended March 31, 2022 and 2021 .

The Company had $ 23 million and $ 0 of loans in nonaccrual status for which there was no related allowance for credit losses at June 30, 2022 and December 31, 2021, respectively.

The $ 23 million of mortgage loans for which there was no related allowance for credit losses pertains to collateral dependent loans where the collateral value exceeds amortized cost.

Current period investment income on mortgage loans in nonaccrual status was less than $ 1 million for both the six months ended June 30, 2022 and 2021 .

Modified Mortgage Loans by Portfolio Segment

3 unchanged sentences

Generally, the types of concessions may include reducing the amount of debt owed, 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 Company did not have a significant amount of mortgage loans modified in a TDR during both the three months ended March 31, 2022 and 2021.

The Company did not have a significant amount of mortgage loans modified in a TDR during both the six months ended June 30, 2022 and 2021.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

Short-term modifications made on a good faith basis to borrowers who were not more than 30 days past due at December 31, 2019 and in response to the COVID-19 pandemic are not considered TDRs.

5 unchanged sentences

Unrealized investment gains (losses) on fixed maturity securities and the effect on DAC, VOBA, deferred sales inducements (“DSI”) and future policy benefits, that would result from the realization of the unrealized gains (losses), are included in net unrealized investment gains (losses) in accumulated other comprehensive income (loss) (“AOCI”).

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

The components of net unrealized investment gains (losses), included in AOCI, were as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

(In millions)

10 unchanged sentences

The changes in net unrealized investment gains (losses) were as follows:

Three Months Ended March 31, 2022

Six Months Ended June 30, 2022

(In millions)

5 unchanged sentences

Deferred income tax benefit (expense) 1,923

Balance at March 31, 2022 $ 419

Balance at June 30, 2022 $ ( 3,017 )

Change in net unrealized investment gains (losses) $ ( 7,237 )

1 unchanged sentence

There were no investments in any counterparty that were greater than 10% of the Company’s equity, other than the U.S.

government and its agencies, at both March 31, 2022 and December 31, 2021.

government and its agencies, at both June 30, 2022 and December 31, 2021.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

Securities Lending

Elements of the securities lending program are presented below at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

(In millions)

8 unchanged sentences

(2) Included within payables for collateral under securities loaned and other transactions.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

(3) Securities collateral received from counterparties may not be sold or re-pledged, unless the counterparty is in default, and is not reported on the interim condensed consolidated financial statements.

The cash collateral liability by loaned security type and remaining tenor of the agreements were as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Open (1) 1 Month or Less 1 to 6 Months Total Open (1) 1 Month or Less 1 to 6 Months Total

3 unchanged sentences

Foreign corporate — 157 — 157 — — — —

Foreign government — 19 — 19 — — — —

Total $ 1,429 $ 2,882 $ 1,080 $ 5,391 $ 1,095 $ 2,125 $ 1,391 $ 4,611

2 unchanged sentences

If the Company is required to return significant amounts of cash collateral on short notice and is forced to sell securities to meet the return obligation, it may have difficulty selling such collateral that is invested in securities in a timely manner, be forced to sell securities in a volatile or illiquid market for less than what otherwise would have been realized in normal market conditions, or both.

The estimated fair value of the securities on loan related to the cash collateral on open at March 31, 2022 was $ 1.1 billion, primarily comprised of U.S.

The estimated fair value of the securities on loan related to the cash collateral on open at June 30, 2022 was $ 1.4 billion, primarily comprised of U.S.

government and agency securities which, if put back to the Company, could be immediately sold to satisfy the cash requirement.

The reinvestment portfolio acquired with the cash collateral consisted principally of fixed maturity securities (including U.S.

government and agency securities, agency RMBS, ABS, non-agency RMBS and CMBS) with 55 % invested in U.S.

government and agency securities, agency RMBS and cash and cash equivalents at March 31, 2022.

government and agency securities, agency RMBS, ABS, U.S.

and foreign corporate securities and CMBS) with 58 % invested in U.S.

government and agency securities, agency RMBS and cash and cash equivalents at June 30, 2022.

If the securities on loan or the reinvestment portfolio become less liquid, the Company has the liquidity resources of most of its general account available to meet any potential cash demands when securities on loan are put back to the Company.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

Invested Assets on Deposit, Held in Trust and Pledged as Collateral

Invested assets on deposit, held in trust and pledged as collateral at estimated fair value were as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

(In millions)

4 unchanged sentences

_______________

(1) The Company has assets, primarily fixed maturity securities, on deposit with governmental authorities relating to certain policyholder liabilities, of which $ 41 million and $ 25 million of the assets on deposit represents restricted cash and cash equivalents at March 31, 2022 and December 31, 2021, respectively.

(2) The Company has assets, primarily fixed maturity securities, held in trust relating to certain reinsurance transactions, of which $ 102 million and $ 119 million of the assets held in trust balance represents restricted cash and cash equivalents at March 31, 2022 and December 31, 2021, respectively.

(1) The Company has assets, primarily fixed maturity securities, on deposit with governmental authorities relating to certain policyholder liabilities, of which $ 42 million and $ 25 million of the assets on deposit represents restricted cash and cash equivalents at June 30, 2022 and December 31, 2021, respectively.

(2) The Company has assets, primarily fixed maturity securities, held in trust relating to certain reinsurance transactions, of which $ 131 million and $ 119 million of the assets held in trust balance represents restricted cash and cash equivalents at June 30, 2022 and December 31, 2021, respectively.

(3) The Company has pledged invested assets in connection with various agreements and transactions, including funding agreements (see Note 3 of the Notes to the Consolidated Financial Statements included in the 2021 Annual Report) and derivative transactions (see Note 5).

See “— Securities Lending” for information regarding securities on loan.

In addition, the Company’s investment in FHLB common stock, which is considered restricted until redeemed by the issuer, was $ 89 million and $ 70 million at redemption value at March 31, 2022 and December 31, 2021, respectively.

In addition, the Company’s investment in FHLB common stock, which is considered restricted until redeemed by the issuer, was $ 144 million and $ 70 million at redemption value at June 30, 2022 and December 31, 2021, respectively.

Variable Interest Entities

4 unchanged sentences

In addition, the evaluation of whether a legal entity is a VIE and if the Company is a primary beneficiary includes a review of the capital structure of the VIE, the related contractual relationships and terms, the nature of the operations and purpose of the VIE, the nature of the VIE interests issued and the Company’s involvement with the entity.

There were no material VIEs for which the Company has concluded that it is the primary beneficiary at either March 31, 2022 or December 31, 2021.

There were no material VIEs for which the Company has concluded that it is the primary beneficiary at either June 30, 2022 or December 31, 2021.

The carrying amount and maximum exposure to loss related to the VIEs for which the Company has concluded that it holds a variable interest, but is not the primary beneficiary, were as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Amount Maximum

5 unchanged sentences

Total $ 19,226 $ 21,471 $ 20,151 $ 20,917

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

The Company’s investments in unconsolidated VIEs are described below.

15 unchanged sentences

(i) the amount invested in debt or equity of the VIE and (ii) commitments to the VIE, as described in Note 11.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

Net Investment Income

1 unchanged sentence

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

(In millions)

6 unchanged sentences

Cash, cash equivalents and short-term investments 6 1 7 3

Other 18 9 32 19

Total investment income 1,111 1,247 2,303 2,469

2 unchanged sentences

_______________

(1) Includes net investment income pertaining to other limited partnership interests of $ 212 million and $ 331 million for the three months ended March 31, 2022 and 2021, respectively.

(1) Includes net investment income pertaining to other limited partnership interests of $ 93 million and $ 305 million for the three months and six months ended June 30, 2022, respectively, and $ 339 million and $ 670 million for the three months and six months ended June 30, 2021, respectively.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

Net Investment Gains (Losses)

2 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

(In millions)

4 unchanged sentences

Total net investment gains (losses) $ ( 66 ) $ ( 34 ) $ ( 134 ) $ ( 20 )

Gains (losses) from foreign currency transactions included within net investment gains (losses) were ($ 16 ) million and $ 0 for the three months ended March 31, 2022 and 2021, respectively.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Investments (continued)

Gains (losses) from foreign currency transactions included within net investment gains (losses) were ($ 5 ) million and ($ 21 ) million for the three months and six months ended June 30, 2022, respectively, and $ 1 million and $ 0 for the three months and six months ended June 30, 2021, respectively.

Sales or Disposals of Fixed Maturity Securities

2 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

(In millions)

9 unchanged sentences

• Interest rate derivatives:

swaps, caps, swaptions and forwards;

swaps, floors, caps, swaptions and forwards;

• Foreign currency exchange rate derivatives:

10 unchanged sentences

The primary underlying risk exposure, gross notional amount and estimated fair value of derivatives held were as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Primary Underlying Risk Exposure Gross

10 unchanged sentences

Interest rate swaps Interest rate 3,295 198 — 2,595 325 17

Interest rate floors Interest rate 2,250 15 2 — — —

Interest rate caps Interest rate 5,350 120 27 5,100 29 4

17 unchanged sentences

Total $ 98,877 $ 3,227 $ 8,011 $ 90,931 $ 3,312 $ 10,140

Based on gross notional amounts, a substantial portion of the Company’s derivatives was not designated or did not qualify as part of a hedging relationship at both March 31, 2022 and December 31, 2021.

Based on gross notional amounts, a substantial portion of the Company’s derivatives was not designated or did not qualify as part of a hedging relationship at both June 30, 2022 and December 31, 2021.

The Company’s use of derivatives includes (i) derivatives that serve as macro hedges of the Company’s exposure to various risks and generally do not qualify for hedge accounting because they do not meet the criteria required under portfolio hedging rules;

8 unchanged sentences

(In millions)

Three Months Ended March 31, 2022

Three Months Ended June 30, 2022

Derivatives Designated as Hedging Instruments:

11 unchanged sentences

Total $ 1,767 $ ( 34 ) $ 15 $ 265

Three Months Ended March 31, 2021

Three Months Ended June 30, 2021

Derivatives Designated as Hedging Instruments:

11 unchanged sentences

Total $ ( 682 ) $ ( 2 ) $ 9 $ 114

At March 31, 2022 and December 31, 2021, the maximum length of time over which the Company was hedging its exposure to variability in future cash flows for forecasted transactions was one year and two years, respectively.

At March 31, 2022 and December 31, 2021, the balance in AOCI associated with cash flow hedges was $ 346 million and $ 329 million, respectively.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Derivatives (continued)

Net Derivative Gains (Losses) Recognized for Derivatives Net Derivative Gains (Losses) Recognized for Hedged Items Net Investment Income Amount of Gains (Losses) Deferred in AOCI

(In millions)

Six Months Ended June 30, 2022

Derivatives Designated as Hedging Instruments:

Cash flow hedges:

Interest rate $ 4 $ — $ 2 $ ( 41 )

Foreign currency exchange rate 1 ( 2 ) 25 325

Total cash flow hedges 5 ( 2 ) 27 284

Derivatives Not Designated or Not Qualifying as Hedging Instruments:

Interest rate ( 2,438 ) — — —

Foreign currency exchange rate 113 ( 39 ) — —

Credit ( 32 ) — — —

Equity market 728 — — —

Embedded 3,911 — — —

Total non-qualifying hedges 2,282 ( 39 ) — —

Total $ 2,287 $ ( 41 ) $ 27 $ 284

Six Months Ended June 30, 2021

Derivatives Designated as Hedging Instruments:

Cash flow hedges:

Interest rate $ 1 $ — $ 2 $ ( 33 )

Foreign currency exchange rate 8 ( 3 ) 16 79

Total cash flow hedges 9 ( 3 ) 18 46

Derivatives Not Designated or Not Qualifying as Hedging Instruments:

Interest rate ( 1,190 ) — — —

Foreign currency exchange rate 11 1 — —

Credit 11 — — —

Equity market ( 448 ) — — —

Embedded ( 579 ) — — —

Total non-qualifying hedges ( 2,195 ) 1 — —

Total $ ( 2,186 ) $ ( 2 ) $ 18 $ 46

At June 30, 2022 and December 31, 2021, the maximum length of time over which the Company was hedging its exposure to variability in future cash flows for forecasted transactions was one year and two years, respectively.

At June 30, 2022 and December 31, 2021, the balance in AOCI associated with cash flow hedges was $ 606 million and $ 329 million, respectively.

Credit Derivatives

5 unchanged sentences

The estimated fair value, maximum amount of future payments and weighted average years to maturity of written credit default swaps were as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Rating Agency Designation of Referenced Credit Obligations (1) Estimated

32 unchanged sentences

(In millions)

March 31, 2022

June 30, 2022

Derivative assets $ 3,127 $ ( 1,864 ) $ ( 1,164 ) $ 99 $ ( 55 ) $ 44

14 unchanged sentences

The aggregate estimated fair values of derivatives in a net liability position containing such credit-contingent provisions and the aggregate estimated fair value of assets posted as collateral for such instruments were as follows at:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

(In millions)

12 unchanged sentences

Investments that do not have a readily determinable fair value and are measured at net asset value (or equivalent) as a practical expedient to estimated fair value are excluded from the fair value hierarchy.

March 31, 2022

June 30, 2022

Fair Value Hierarchy Total Estimated

90 unchanged sentences

Price adjustments are applied if prices or quotes received from independent pricing services or brokers are not considered reflective of market activity or representative of estimated fair value.

The Company did not have significant price adjustments during the three months ended March 31, 2022.

The Company did not have significant price adjustments during the six months ended June 30, 2022.

Determination of Fair Value

75 unchanged sentences

Certain quantitative information about the significant unobservable inputs used in the fair value measurement, and the sensitivity of the estimated fair value to changes in those inputs, for the more significant asset and liability classes measured at fair value on a recurring basis using significant unobservable inputs (Level 3) were as follows at:

March 31, 2022 December 31, 2021 Impact of

June 30, 2022 December 31, 2021 Impact of

Increase in Input

37 unchanged sentences

For derivatives valued based on third-party pricing models, an increase (decrease) in credit spreads would generally result in a higher (lower) fair value.

The changes in assets and (liabilities) measured at estimated fair value on a recurring basis using significant unobservable inputs (Level 3) were summarized as follows:

Fair Value Measurements Using Significant Unobservable Inputs (Level 3)

Fixed Maturity Securities

Corporate (1) Structured Securities Foreign

Government Equity

Securities Short-term

Investments Net

Derivatives (2) Net Embedded

Derivatives (3) Separate

Account Assets (4)

(In millions)

Three Months Ended June 30, 2022

Balance, beginning of period

$ 1,618 $ 194 $ 23 $ 13 $ — $ 30 $ ( 6,911 ) $ —

Total realized/unrealized gains (losses) included in net income (loss) (5) (6)

( 6 ) — — 1 — ( 5 ) 2,582 —

Total realized/unrealized gains (losses) included in AOCI

( 110 ) 3 ( 5 ) — — 12 — —

Purchases (7) 330 201 — 13 — 1 — —

Sales (7) ( 56 ) ( 11 ) — — — — — —

Issuances (7) — — — — — — — —

Settlements (7) — — — — — — ( 116 ) —

Transfers into Level 3 (8) 90 34 22 — — — — —

Transfers out of Level 3 (8) ( 156 ) ( 76 ) — — — — — —

Balance, end of period $ 1,710 $ 345 $ 40 $ 27 $ — $ 38 $ ( 4,445 ) $ —

Three Months Ended June 30, 2021

Balance, beginning of period

$ 670 $ 126 $ — $ 3 $ — $ 8 $ ( 6,468 ) $ 2

Total realized/unrealized gains (losses) included in net income (loss) (5) (6)

— — — — — 8 ( 1,127 ) —

Total realized/unrealized gains (losses) included in AOCI

21 1 — — — 10 — —

Purchases (7) 231 163 12 — — — — —

Sales (7) ( 12 ) ( 9 ) — — — ( 6 ) — —

Issuances (7) — — — — — — — —

Settlements (7) — — — — — — ( 120 ) —

Transfers into Level 3 (8) 65 — — — — — — —

Transfers out of Level 3 (8) ( 86 ) ( 64 ) — — — — — ( 2 )

Balance, end of period $ 889 $ 217 $ 12 $ 3 $ — $ 20 $ ( 7,715 ) $ —

Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at June 30, 2022 (9)

$ — $ — $ — $ 1 $ — $ ( 5 ) $ 2,537 $ —

Changes in unrealized gains (losses) included in OCI for the instruments still held at June 30, 2022 (9)

$ ( 117 ) $ 2 $ ( 5 ) $ — $ — $ 12 $ — $ —

Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at June 30, 2021 (9)

$ — $ — $ — $ — $ — $ 3 $ ( 1,104 ) $ —

Changes in unrealized gains (losses) included in OCI for the instruments still held at June 30, 2021 (9)

$ 21 $ 1 $ — $ — $ — $ 10 $ — $ —

Brighthouse Financial, Inc.

1 unchanged sentence

Fair Value (continued)

The changes in assets and (liabilities) measured at estimated fair value on a recurring basis using significant unobservable inputs (Level 3) were summarized as follows:

Fair Value Measurements Using Significant Unobservable Inputs (Level 3)

8 unchanged sentences

(In millions)

Three Months Ended March 31, 2022

Six Months Ended June 30, 2022

Balance, beginning of period

11 unchanged sentences

Balance, end of period $ 1,710 $ 345 $ 40 $ 27 $ — $ 38 $ ( 4,445 ) $ —

Three Months Ended March 31, 2021

Six Months Ended June 30, 2021

Balance, beginning of period

11 unchanged sentences

Balance, end of period $ 889 $ 217 $ 12 $ 3 $ — $ 20 $ ( 7,715 ) $ —

Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at March 31, 2022 (9)

Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at June 30, 2022 (9)

$ — $ — $ — $ 1 $ — $ ( 15 ) $ 4,001 $ —

Changes in unrealized gains (losses) included in OCI for the instruments still held at March 31, 2022 (9)

Changes in unrealized gains (losses) included in OCI for the instruments still held at June 30, 2022 (9)

$ ( 218 ) $ ( 12 ) $ ( 9 ) $ — $ — $ 16 $ — $ —

Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at March 31, 2021 (9)

Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at June 30, 2021 (9)

$ ( 1 ) $ — $ — $ — $ — $ 2 $ ( 560 ) $ —

Changes in unrealized gains (losses) included in OCI for the instruments still held at March 31, 2021 (9)

Changes in unrealized gains (losses) included in OCI for the instruments still held at June 30, 2021 (9)

$ — $ 1 $ — $ — $ — $ 9 $ — $ —

3 unchanged sentences

(2) Freestanding derivative assets and liabilities are presented net for purposes of the rollforward.

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Fair Value (continued)

(3) Embedded derivative assets and liabilities are presented net for purposes of the rollforward.

6 unchanged sentences

Substantially all realized/unrealized gains (losses) included in net income (loss) for net derivatives and net embedded derivatives are reported in net derivative gains (losses).

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Fair Value (continued)

(6) Interest and dividend accruals, as well as cash interest coupons and dividends received, are excluded from the rollforward.

12 unchanged sentences

The carrying values and estimated fair values for such financial instruments, and their corresponding placement in the fair value hierarchy, are summarized as follows at:

March 31, 2022

June 30, 2022

Fair Value Hierarchy

24 unchanged sentences

Separate account liabilities $ 1,440 $ — $ 1,440 $ — $ 1,440

Long-term Debt

On April 15, 2022, BHF entered into a new revolving credit agreement with respect to a new $ 1.0 billion senior unsecured revolving credit facility maturing April 15, 2027 (the “2022 Revolving Credit Facility”), all of which may be used for revolving loans or letters of credit.

The 2022 Revolving Credit Facility refinanced and replaced BHF’s former $ 1.0 billion senior unsecured revolving credit facility that was scheduled to mature May 7, 2024.

At June 30, 2022, there were no borrowings or letters of credit outstanding under the 2022 Revolving Credit Facility.

Preferred Stock

Preferred stock shares authorized, issued and outstanding were as follows at both March 31, 2022 and December 31, 2021:

Preferred stock shares authorized, issued and outstanding were as follows at both June 30, 2022 and December 31, 2021:

Shares Authorized Shares Issued Shares Outstanding

10 unchanged sentences

The per share and aggregate dividend declared for BHF’s preferred stock by series was as follows:

Three Months Ended March 31,

Series Per Share Aggregate Per Share Aggregate

Three Months Ended June 30, Six Months Ended June 30,

2022 2021 2022 2021

Series Per Share Aggregate Per Share Aggregate Per Share Aggregate Per Share Aggregate

(In millions, except per share data)

4 unchanged sentences

Total $ 26 $ 21 $ 53 $ 46

Common Stock Repurchase Program

During the three months ended March 31, 2022 and 2021, BHF repurchased 2,398,636 and 1,659,872 shares, respectively, of its common stock through open market purchases pursuant to 10b5-1 plans for $ 127 million and $ 68 million, respectively.

At March 31, 2022, BHF had $ 654 million remaining under its common stock repurchase program.

Brighthouse Financial, Inc.

1 unchanged sentence

Equity (continued)

Common Stock Repurchase Program

During the six months ended June 30, 2022 and 2021, BHF repurchased 5,152,415 and 4,312,267 shares, respectively, of its common stock through open market purchases pursuant to 10b5-1 plans for $ 259 million and $ 192 million, respectively.

At June 30, 2022, BHF had $ 522 million remaining under its common stock repurchase program.

Accumulated Other Comprehensive Income (Loss)

Information regarding changes in the balances of each component of AOCI was as follows:

Three Months Ended March 31, 2022

Three Months Ended June 30, 2022

Investment Gains

5 unchanged sentences

(In millions)

Balance at March 31, 2022 $ 167 $ 252 $ ( 13 ) $ ( 43 ) $ 363

OCI before reclassifications ( 4,690 ) 265 ( 24 ) ( 2 ) ( 4,451 )

Deferred income tax benefit (expense) (2) 964 ( 34 ) 5 1 936

AOCI before reclassifications, net of income tax ( 3,559 ) 483 ( 32 ) ( 44 ) ( 3,152 )

Amounts reclassified from AOCI 81 ( 5 ) — 2 78

Deferred income tax benefit (expense) (2) ( 17 ) — — — ( 17 )

Amounts reclassified from AOCI, net of income tax 64 ( 5 ) — 2 61

Balance at June 30, 2022 $ ( 3,495 ) $ 478 $ ( 32 ) $ ( 42 ) $ ( 3,091 )

Three Months Ended June 30, 2021

Investment Gains

(Losses), Net of

Related Offsets (1) Unrealized

Gains (Losses)

on Derivatives Foreign

Adjustments Defined Benefit Plans Adjustment Total

(In millions)

Balance at March 31, 2021 $ 3,387 $ 55 $ ( 14 ) $ ( 39 ) $ 3,389

OCI before reclassifications 1,385 114 1 — 1,500

Deferred income tax benefit (expense) (2) ( 291 ) ( 24 ) — 1 ( 314 )

AOCI before reclassifications, net of income tax 4,481 145 ( 13 ) ( 38 ) 4,575

Amounts reclassified from AOCI 32 ( 4 ) — ( 1 ) 27

Deferred income tax benefit (expense) (2) ( 7 ) 1 — — ( 6 )

Amounts reclassified from AOCI, net of income tax 25 ( 3 ) — ( 1 ) 21

Balance at June 30, 2021

$ 4,506 $ 142 $ ( 13 ) $ ( 39 ) $ 4,596

Brighthouse Financial, Inc.

Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) (continued)

Equity (continued)

Six Months Ended June 30, 2022

Investment Gains

(Losses), Net of

Related Offsets (1) Unrealized

Gains (Losses)

on Derivatives Foreign

Adjustments Defined Benefit Plans Adjustment Total

(In millions)

Balance at December 31, 2021

6 unchanged sentences

Amounts reclassified from AOCI, net of income tax 98 ( 6 ) — 2 94

Balance at March 31, 2022

Balance at June 30, 2022

$ ( 3,495 ) $ 478 $ ( 32 ) $ ( 42 ) $ ( 3,091 )

Three Months Ended March 31, 2021

Six Months Ended June 30, 2021

Investment Gains

13 unchanged sentences

Amounts reclassified from AOCI, net of income tax 15 ( 9 ) — ( 1 ) 5

Balance at March 31, 2021

Balance at June 30, 2021

$ 4,506 $ 142 $ ( 13 ) $ ( 39 ) $ 4,596

9 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

(In millions)

12 unchanged sentences

Gains (losses) on cash flow hedges, net of income tax 5 3 6 9

Defined benefit plans adjustment:

Amortization of net actuarial gains (losses) ( 2 ) 1 ( 2 ) 1

Amortization of defined benefit plans, before income tax ( 2 ) 1 ( 2 ) 1

Income tax (expense) benefit — — — —

Amortization of defined benefit plans, net of income tax ( 2 ) 1 ( 2 ) 1

Total reclassifications, net of income tax $ ( 61 ) $ ( 21 ) $ ( 94 ) $ ( 5 )

7 unchanged sentences

The passage of time reflects the satisfaction of the Company’s performance obligations to the Funds and is used to recognize revenue associated with 12b-1 fees.

Other revenues consisted primarily of 12b-1 fees of $ 82 million and $ 88 million for the three months ended March 31, 2022 and 2021, respectively, of which substantially all were reported in the Annuities segment.

Other revenues consisted primarily of 12b-1 fees of $ 74 million and $ 156 million for the three months and six months ended June 30, 2022, respectively, and $ 91 million and $ 179 million for the three months and six months ended June 30, 2021, respectively, of which substantially all were reported in the Annuities segment.

Brighthouse Financial, Inc.

4 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

(In millions)

7 unchanged sentences

Interest expense on debt 38 40 76 81

Other 177 25 193 42

Total other expenses $ 591 $ 608 $ 1,101 $ 1,170

2 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

(In millions, except share and per share data)

6 unchanged sentences

Diluted $ 12.77 $ 0.11 $ 20.62 $ ( 6.93 )

For the three months ended March 31, 2022, weighted average shares used for calculating diluted earnings per common share excludes 187,371 of out-of-the-money stock options, as the inclusion of such shares would be antidilutive to the earnings per common share calculation due to the average share price for the three months ended March 31, 2022.

For the three months ended March 31, 2021, basic loss per common share equaled diluted loss per common share.

For the three months ended June 30, 2022 and 2021 and the six months ended June 30, 2022, weighted average shares used for calculating diluted earnings per common share excludes 187,371 of out-of-the-money stock options, as the inclusion of such shares would be antidilutive to the earnings per common share calculation due to the average share price for the three months ended June 30, 2022 and 2021 and the six months ended June 30, 2022.

For the six months ended June 30, 2021, basic loss per common share equaled diluted loss per common share.

The diluted shares were not utilized in the per share calculation for this period as the inclusion of such shares would have an antidilutive effect.

17 unchanged sentences

The Company establishes liabilities for litigation and regulatory loss contingencies when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated.

It is possible that some matters could require the Company to pay damages or make other expenditures or establish accruals in amounts that could not be estimated at March 31, 2022.

It is possible that some matters could require the Company to pay damages or make other expenditures or establish accruals in amounts that could not be estimated at June 30, 2022.

Matters as to Which an Estimate Can Be Made

1 unchanged sentence

For such matters where a loss is believed to be reasonably possible, but not probable, no accrual has been made.

In addition to amounts accrued for probable and reasonably estimable losses, as of March 31, 2022, the Company estimates the aggregate range of reasonably possible losses to be up to approximately $ 10 million.

In addition to amounts accrued for probable and reasonably estimable losses, as of June 30, 2022, the Company estimates the aggregate range of reasonably possible losses to be up to approximately $ 10 million.

Matters as to Which an Estimate Cannot Be Made

46 unchanged sentences

Contingencies, Commitments and Guarantees (continued)

As of March 31, 2022, the Company estimates the range of reasonably possible losses in excess of the amounts accrued for certain other loss contingencies to be from zero up to approximately $ 250 million, which are primarily associated with the above reinsurance-related matters.

As of June 30, 2022, the Company estimates the range of reasonably possible losses in excess of the amounts accrued for certain other loss contingencies to be from zero up to approximately $ 125 million, which are primarily associated with the above reinsurance-related matters.

The reduction in the estimated range reflects the settlement of a reinsurance-related matter with a third party during the second quarter of 2022 for $ 140 million, which is reported in other expenses.

For certain other matters, the Company may not currently be able to estimate the reasonably possible loss or range of loss until developments in such matters have provided sufficient information to support an assessment of such loss.

2 unchanged sentences

The Company commits to lend funds under mortgage loan commitments.

The amounts of these mortgage loan commitments were $ 651 million and $ 719 million at March 31, 2022 and December 31, 2021, respectively.

The amounts of these mortgage loan commitments were $ 358 million and $ 719 million at June 30, 2022 and December 31, 2021, respectively.

Commitments to Fund Partnership Investments, Bank Credit Facilities and Private Corporate Bond Investments

The Company commits to fund partnership investments and to lend funds under bank credit facilities and private corporate bond investments.

The amounts of these unfunded commitments were $ 2.3 billion at both March 31, 2022 and December 31, 2021.

The amounts of these unfunded commitments were $ 2.4 billion and $ 2.3 billion at June 30, 2022 and December 31, 2021, respectively.

In the normal course of its business, the Company has provided certain indemnities, guarantees and commitments to third parties such that it may be required to make payments now or in the future.

8 unchanged sentences

Since these indemnities are generally not subject to limitation with respect to duration or amount, the Company does not believe that it is possible to determine the maximum potential amount that could become due under these indemnities in the future.

The Company’s recorded liabilities were $ 1 million at both March 31, 2022 and December 31, 2021 for indemnities, guarantees and commitments.

Subsequent Event

The 2022 Revolving Credit Facility refinanced and replaced BHF’s former $ 1.0 billion senior unsecured revolving credit facility that was scheduled to mature May 7, 2024.

At May 10, 2022, there were no borrowings or letters of credit outstanding under the 2022 Revolving Credit Facility.

The Company’s recorded liabilities were $ 1 million at both June 30, 2022 and December 31, 2021 for indemnities, guarantees and commitments.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements