Brighthouse Financial, Inc. 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations Index to Management’s Discussion and Analysis of Financial Condition and Results of Operations Page Introduction 58 Executive Summary 58 Industry Trends and Uncertainties 59 Summary of Critical Accounting Estimates 61 Non-GAAP Financial Disclosures 61 Results of Operations 63 Investments 75 Derivatives 84 Policyholder Liabilities 85 Liquidity and Capital Resources 87 Note Regarding Forward-Looking Statements 95 57 Table of Contents For purposes of this discussion, “Brighthouse Financial,” the “Company,” “we,” “our” and “us” refer to Brighthouse Financial, Inc. and its subsidiaries, and “BHF” refers solely to Brighthouse Financial, Inc., the ultimate holding company for all of our subsidiaries, and not to any of its subsidiaries. This Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with (i) the Interim Condensed Consolidated Financial Statements and related notes included elsewhere herein; (ii) our Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Annual Report”) filed with the U.S. Securities and Exchange Commission (“SEC”) on February 28, 2025; (iii) our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 (the “First Quarter Form 10-Q”) filed with the SEC on May 9, 2025; and (iv) our current reports on Form 8-K filed in 2025. Introduction This Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to help the reader understand the results of operations, financial condition and cash flows of Brighthouse Financial for the periods indicated. Prior to discussing our results of operations, we present information that we believe is useful to understanding the discussion of our financial results. This information precedes our results of operations discussion and is most beneficial when read in the sequence presented. A summary of key informational sections is as follows: • “Executive Summary” provides summarized information regarding our business, segments and financial results. • “Industry Trends and Uncertainties” discusses updates and changes to a number of trends and uncertainties included in our 2024 Annual Report that we believe may materially affect our future financial condition, results of operations or cash flows. • “Summary of Critical Accounting Estimates” explains what we believe to be the most critical estimates and judgments applied in determining our results in accordance with accounting principles generally accepted in the United States of America (“GAAP”). • “Non-GAAP Financial Disclosures” defines key financial measures presented in our results of operations discussion that are not calculated in accordance with GAAP but are used by management in evaluating company and segment performance. As described in this section, adjusted earnings is presented by key business activities which are derived, but different, from the line items presented in the GAAP statements of operations. This section also refers to certain other terms used to describe our insurance business and financial and operating metrics but is not intended to be exhaustive. Our Results of Operations discussion and analysis presents a review for the three months and six months ended June 30, 2025 and 2024 and period-over-period, as well as year-over-year, comparisons between these periods. Executive Summary We are one of the largest providers of annuity and life insurance products in the U.S. through multiple independent distribution channels and marketing arrangements with a diverse network of distribution partners. We are organized into the following reportable segments: Annuities; Life; Run-off; and Corporate & Other. See “Business — Segment Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Executive Summary” included in our 2024 Annual Report, as well as Note 2 of the Notes to the Interim Condensed Consolidated Financial Statements for further information regarding our segments. 58 Table of Contents Net income (loss) available to shareholders and adjusted earnings (loss), a non-GAAP financial measure, were as follows: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (In millions) Income (loss) available to shareholders before provision for income tax $ 68 $ (11) $ (314) $ (653) Less: Provision for income tax expense (benefit) 8 (20) (80) (143) Net income (loss) available to shareholders (1) $ 60 $ 9 $ (234) $ (510) Pre-tax adjusted earnings (loss), less net income (loss) attributable to noncontrolling interests and preferred stock dividends (1) $ 244 $ 418 $ 531 $ 308 Less: Provision for income tax expense (benefit) 46 72 98 60 Adjusted earnings (loss) (1) $ 198 $ 346 $ 433 $ 248 __________________ (1) We use the term “net income (loss) available to shareholders” to refer to “net income (loss) available to Brighthouse Financial, Inc.’s common shareholders” and “adjusted loss” to refer to negative adjusted earnings values throughout the results of operations discussions. For the three months ended June 30, 2025, we had net income available to shareholders of $60 million and adjusted earnings of $198 million compared to net income available to shareholders of $9 million and adjusted earnings of $346 million for the three months ended June 30, 2024. Net income available to shareholders for the three months ended June 30, 2025 primarily reflects favorable pre-tax adjusted earnings and net favorable changes in the estimated fair value of our variable annuity guaranteed benefit riders due to market factors. The favorable impacts were partially offset by an unfavorable change in the estimated fair value of freestanding interest rate derivatives we use to hedge our universal life with secondary guarantees (“ULSG”) business resulting from increasing long-term interest rates, the weakening of the U.S. dollar unfavorably impacting foreign currency forwards and swaps, net investment losses on mortgage loans and net investment losses on sales of fixed maturity securities. For the six months ended June 30, 2025, we had a net loss available to shareholders of $234 million and adjusted earnings of $433 million compared to a net loss available to shareholders of $510 million and adjusted earnings of $248 million for the six months ended June 30, 2024. The net loss available to shareholders for the six months ended June 30, 2025 primarily reflects net unfavorable changes in the estimated fair value of our variable annuity guaranteed benefit riders due to market factors, an unfavorable change in the estimated fair value of freestanding interest rate derivatives we use to hedge our ULSG business, the weakening of the U.S. dollar unfavorably impacting foreign currency forwards and swaps, net investment losses on mortgage loans and net investment losses on sales of fixed maturity securities. These unfavorable impacts were partially offset by favorable pre-tax adjusted earnings. See “— Non-GAAP Financial Disclosures.” See “— Results of Operations” for a detailed discussion of our results. Industry Trends and Uncertainties Throughout this Management’s Discussion and Analysis of Financial Condition and Results of Operations, we discuss a number of trends and uncertainties that we believe may materially affect our future financial condition, results of operations or cash flows. Where these trends or uncertainties are specific to a particular aspect of our business, we often include such a discussion under the relevant caption of this Management’s Discussion and Analysis of Financial Condition and Results of Operations, as part of our broader analysis of that area of our business. Refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Industry Trends and Uncertainties” included in our 2024 Annual Report, as amended or supplemented by our First Quarter Form 10-Q and herein, for a comprehensive discussion of some of the key general trends and uncertainties that have influenced the development of our business and our historical financial performance and that we believe will continue to influence our business and results of operations in the future. 59 Table of Contents Financial and Economic Environment Our business and results of operations are materially affected by conditions in the capital markets and the economy generally. Stressed conditions, volatility and disruptions in the capital markets or financial asset classes can have an adverse effect on us. Equity market performance can affect our profitability for variable annuities, Shield ® Level Annuities (“Shield” and “Shield Annuity”) and other separate account products as a result of the effects it has on product demand, revenues, expenses, reserves and our risk management effectiveness. In September, November and December 2024, the Federal Reserve Board (the “Federal Reserve”) decreased the target range for the federal funds rate, and any additional future decrease may negatively impact our business in certain respects, including our investment portfolio, by lowering the level of long-term interest rates and changing the shape of the yield curve. The level of long-term interest rates and the shape of the yield curve can have a negative effect on the profitability for variable annuities, as well as the demand for, and the profitability of, spread-based products such as fixed annuities, index-linked annuities and universal life insurance. Low interest rates and risk premium, including credit spread, affect new money rates on invested assets and the cost of product guarantees. Insurance premium growth and demand for our products is impacted by the general health of U.S. economic activity. A sustained or material increase in inflation could also affect our business in several ways. During inflationary periods, the value of fixed income investments falls which could increase realized and unrealized losses. Inflation also increases our expenses (including, among others, for labor and third-party services), potentially putting pressure on profitability if such costs cannot be passed through to policyholders in our product prices. Prolonged and elevated inflation could adversely affect the financial markets and the economy generally and dispelling it may require governments to pursue restrictive fiscal and monetary policies, which could constrain overall economic activity and inhibit revenue growth. Events involving limited liquidity, defaults, nonperformance or other adverse developments that affect financial institutions or the financial services industry generally, or concerns or rumors about events of these kinds or other similar risks, could adversely affect market-wide liquidity, which could increase the risk of a recession or an equity market downturn and negatively impact various portions of our business, including our investment portfolio. See “Risk Factors — Economic Environment and Capital Markets-Related Risks — If difficult conditions in the capital markets and the U.S. economy generally persist or are perceived to persist, they may materially adversely affect our business and results of operations” and “Risk Factors — Risks Related to Our Investment Portfolio — Our investment portfolio is subject to significant financial risks both in the U.S. and global financial markets, including credit risk, interest rate risk, inflation risk, market valuation risk, liquidity risk, real estate risk, derivatives risk, and other factors outside our control, the occurrence of any of which could have a material adverse effect on our financial condition and results of operations” included in our 2024 Annual Report. The above factors affect our expectations regarding future margins. We review our long-term assumptions about capital markets returns and interest rates, along with other assumptions such as contract holder behavior, as part of our annual actuarial review. As additional company specific or industry information on contract holder behavior becomes available, related assumptions may change and may potentially have a material impact on liability valuations and net income. We continue to closely monitor political and economic conditions that might contribute to market volatility and their impact on our business operations, investment portfolio and derivatives, such as global inflation, tariffs imposed or threatened by the U.S. or foreign governments, uncertainty and instability in certain asset classes (including commercial real estate), supply chain disruptions and recent geopolitical conflicts, including in Europe and the Middle East. See “— Investments — Current Environment” herein, as well as “Risk Factors — Economic Environment and Capital Markets-Related Risks,” “Risk Factors — Risks Related to Our Investment Portfolio,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Risk Management Strategies,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Industry Trends and Uncertainties” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations —Investments” included in our 2024 Annual Report for a detailed discussion of financial and economic impacts on our business, including the potential impacts of interest rate risk and inflation risk on our investments and overall business. Regulatory Developments Our insurance subsidiaries and Brighthouse Reinsurance Company of Delaware (“BRCD”) are primarily regulated at the state level, with some products and services also subject to federal regulation. In addition, BHF and its insurance subsidiaries are subject to regulation under the insurance holding company laws of various U.S. jurisdictions. Furthermore, some of our operations, products and services are subject to the Employee Retirement Income Security Act of 1974, consumer protection laws, securities, broker-dealer and investment advisor regulations, as well as environmental and unclaimed property laws and regulations. See “Business — Regulation,” as well as “Risk Factors — Regulatory and Legal Risks” included in our 2024 Annual Report, as amended or supplemented by our quarterly reports under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Industry Trends and Uncertainties — Regulatory Developments.” 60 Table of Contents Summary of Critical Accounting Estimates The preparation of financial statements in conformity with GAAP requires management to adopt accounting policies and make estimates and assumptions that affect amounts reported on the Interim Condensed Consolidated Financial Statements. The most critical estimates include those used in determining: • liability for future policy benefits; • estimated fair values of market risk benefits (“MRB”); • estimated fair values of freestanding derivatives and the recognition and estimated fair value of embedded derivatives requiring bifurcation; and • measurement of income taxes and the valuation of deferred tax assets. 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; others are specific to our business and operations. Actual results could differ from these estimates. The above critical accounting estimates are described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Summary of Critical Accounting Estimates” and Note 1 of the Notes to the Consolidated Financial Statements included in our 2024 Annual Report. Non-GAAP Financial Disclosures We present certain measures of our performance that are not calculated in accordance with GAAP. Our definitions of non-GAAP financial measures may differ from those used by other companies. Adjusted Earnings Adjusted earnings is a financial measure used by management to evaluate performance and facilitate comparisons to industry results. We believe the presentation of adjusted earnings, as the Company measures it for management purposes, enhances the understanding of our performance by the investor community by highlighting the results of operations and the underlying profitability drivers of our business. Adjusted earnings should not be viewed as a substitute for net income (loss) available to Brighthouse Financial, Inc.’s common shareholders, which is the most directly comparable financial measure calculated in accordance with GAAP. See “— Results of Operations” for a reconciliation of adjusted earnings to net income (loss) available to Brighthouse Financial, Inc.’s common shareholders. Adjusted earnings, which may be positive or negative, focuses on our primary businesses by excluding the impact of market volatility, which could distort trends. Adjusted earnings was updated during the first quarter of 2025 in connection with the establishment of a trading portfolio comprised of certain fixed income securities (classified as “trading securities” under GAAP). The Company did not have trading securities prior to the first quarter of 2025. The following items are excluded from total revenues in calculating adjusted earnings: • Net investment gains (losses); • Investment gains (losses) on trading securities measured at estimated fair value through net investment income; and • Net derivative gains (losses), excluding earned income and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments, but do not qualify for hedge accounting treatment (“Investment Hedge Adjustments”). The following items are excluded from total expenses in calculating adjusted earnings: • Change in MRBs; and • Change in fair value of the crediting rate on experience-rated contracts and market value adjustments on institutional group annuities that are economically offset by gains (losses) on the related trading securities (“Market Value Adjustments”). The provision for income tax related to adjusted earnings is calculated using the statutory tax rate of 21%, net of impacts related to the dividends received deduction, tax credits and current period non-recurring items. 61 Table of Contents We present adjusted earnings in a manner consistent with management’s view of the primary business activities that drive the profitability of our core businesses. The following table illustrates how each component of adjusted earnings is calculated from the GAAP statements of operations line items: Component of Adjusted Earnings How Derived from GAAP (1) (i) Fee income (i) Universal life and investment-type product policy fees plus Other revenues . (ii) Net investment spread (ii) Net investment income (excluding investment gains (losses) on trading securities) plus Investment Hedge Adjustments reduced by Interest credited to policyholder account balances (excluding Market Value Adjustments) and interest on future policy benefits. (iii) Insurance-related activities (iii) Premiums less Policyholder benefits and claims , excluding interest on future policy benefits. (iv) Amortization of DAC and VOBA (iv) Amortization of deferred policy acquisition costs (“DAC”) and value of business acquired (“VOBA”) . (v) Other expenses (v) Other expenses. (vi) Provision for income tax expense (benefit) (vi) Tax impact of the above items, calculated using the statutory tax rate of 21%, net of impacts related to the dividends received deduction, tax credits and current period non-recurring items. __________________ (1) Italicized items indicate GAAP statements of operations line items. Consistent with GAAP guidance for segment reporting, adjusted earnings is also our GAAP measure of segment performance. Accordingly, we report adjusted earnings by segment in Note 2 of the Notes to the Interim Condensed Consolidated Financial Statements. Adjusted Net Investment Income Adjusted net investment income is used by management to measure our performance, and we believe it enhances the understanding of our investment portfolio results. Adjusted net investment income represents GAAP net investment income plus Investment Hedge Adjustments less investment gains (losses) on trading securities. For a reconciliation of adjusted net investment income to net investment income, the most directly comparable GAAP measure, see table note (3) to the summary yield table located in “— Investments — Current Environment — Investment Portfolio Results.” Adjusted Net Investment Income Yield Similar to adjusted net investment income, adjusted net investment income yield is used by management as a performance measure that we believe enhances the understanding of our investment portfolio results. Adjusted net investment income yield represents adjusted net investment income as a percentage of average quarterly asset carrying values. Asset carrying values exclude unrealized gains (losses), collateral received in connection with our securities lending program, freestanding derivative assets and collateral received from derivative counterparties. Investment fee and expense yields are calculated as a percentage of average quarterly asset estimated fair values. Asset estimated fair values exclude collateral received in connection with our securities lending program, freestanding derivative assets and collateral received from derivative counterparties. For a reconciliation of adjusted net investment income yield to net investment income, the most directly comparable GAAP measure, see the summary yield table located in “— Investments — Current Environment — Investment Portfolio Results.” 62 Table of Contents Results of Operations Consolidated Results for the Three Months and Six Months Ended June 30, 2025 and 2024 Unless otherwise noted, all amounts in the following discussions of our results of operations are stated before income tax except for adjusted earnings, which are presented net of income tax. Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (In millions) Revenues Premiums $ 166 $ 181 $ 352 $ 383 Universal life and investment-type product policy fees 553 580 1,096 1,016 Net investment income 1,285 1,307 2,582 2,561 Other revenues 143 141 279 286 Net investment gains (losses) (39) (120) (122) (162) Net derivative gains (losses) (1,237) (662) (926) (2,583) Total revenues 871 1,427 3,261 1,501 Expenses Policyholder benefits and claims (including liability remeasurement gains (losses) of $0, $0, $0 and $0, respectively) 711 642 1,360 1,610 Interest credited to policyholder account balances 537 509 1,098 1,011 Amortization of DAC and VOBA 149 150 297 301 Change in market risk benefits (1,101) (356) (208) (1,796) Interest expense on debt 38 38 76 76 Other expenses 444 430 899 899 Total expenses 778 1,413 3,522 2,101 Income (loss) before provision for income tax 93 14 (261) (600) Provision for income tax expense (benefit) 8 (20) (80) (143) Net income (loss) 85 34 (181) (457) Less: Net income (loss) attributable to noncontrolling interests — — 2 2 Net income (loss) attributable to Brighthouse Financial, Inc. 85 34 (183) (459) Less: Preferred stock dividends 25 25 51 51 Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ 60 $ 9 $ (234) $ (510) The components of net income (loss) available to shareholders were as follows: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (In millions) Change in market risk benefits $ 1,101 $ 356 $ 208 $ 1,796 Net investment gains (losses) (39) (120) (122) (162) Investment gains (losses) on trading securities (6) — — — Net derivative gains (losses), excluding investment hedge adjustments (1,238) (671) (927) (2,605) Market value adjustments 6 6 (4) 10 Pre-tax adjusted earnings (loss), less net income (loss) attributable to noncontrolling interests and preferred stock dividends 244 418 531 308 Income (loss) available to shareholders before provision for income tax 68 (11) (314) (653) Provision for income tax expense (benefit) 8 (20) (80) (143) Net income (loss) available to shareholders $ 60 $ 9 $ (234) $ (510) 63 Table of Contents Three Months Ended June 30, 2025 Compared with the Three Months Ended June 30, 2024 Income available to shareholders before provision for income tax was $68 million ($60 million, net of income tax), an increase of $79 million ($51 million, net of income tax) from loss available to shareholders before provision for income tax of $11 million ($9 million, net of income tax) in the prior period. The increase in income before provision for income tax was driven by the following favorable items: • gains from variable annuity guaranteed benefit riders, see “— Annuity Guaranteed Benefits and Shield Annuity Liabilities for the Three Months and Six Months Ended June 30, 2025 and 2024”; and • net investment gains (losses) reflecting lower net losses on sales of fixed maturity securities. The increase in income before provision for income taxes was partially offset by the following unfavorable items: • lower pre-tax adjusted earnings, as discussed in greater detail below; • the impact of long-term interest rates on interest rate derivatives used to manage interest rate exposure in our ULSG business, as the long-term interest rate increased in the current period, resulting in a loss of $154 million, and increased in the prior period, resulting in a loss of $97 million; and • the weakening of the U.S. dollar more in the current period than the prior period, unfavorably impacting foreign currency forwards and swaps. The provision for income tax, expressed as a percentage of income (loss) before provision for income tax, resulted in a higher effective tax rate in the current period compared to the prior period. Our effective tax rate differs from the statutory tax rate primarily due to the impacts of the dividends received deduction and tax credits. Six Months Ended June 30, 2025 Compared with the Six Months Ended June 30, 2024 The loss available to shareholders before provision for income tax was $314 million ($234 million, net of income tax), a lower loss of $339 million ($276 million, net of income tax) from loss available to shareholders before provision for income tax of $653 million ($510 million, net of income tax) in the prior period. The lower loss before provision for income tax was driven by the following favorable items: • higher pre-tax adjusted earnings, as discussed in greater detail below; • the impact of long-term interest rates on interest rate derivatives used to manage interest rate exposure in our ULSG business, as the long-term interest rate decreased in the current period, resulting in a loss of $132 million, and increased in the prior period, resulting in a loss of $309 million; and • net investment gains (losses) reflecting lower net losses on sales of fixed maturity securities, partially offset by higher net losses on mortgage loans due to an increase in the allowance for credit losses. The lower loss before provision for income tax was partially offset by the following unfavorable items: • the weakening of the U.S. dollar in the current period and strengthening in the prior period, unfavorably impacting foreign currency forwards and swaps; and • higher losses from variable annuity guaranteed benefit riders, see “— Annuity Guaranteed Benefits and Shield Annuity Liabilities for the Three Months and Six Months Ended June 30, 2025 and 2024.” The provision for income tax, calculated as a percentage of income (loss) before provision for income tax, resulted in an effective tax rate of 31% in the current period compared to 24% in the prior period. Our effective tax rate differs from the statutory tax rate primarily due to the impacts of the dividends received deduction, tax credits and current period non-recurring items. 64 Table of Contents Reconciliation of Net Income (Loss) Available to Shareholders to Adjusted Earnings (Loss) The reconciliation of net income (loss) available to shareholders to adjusted earnings (loss) was as follows: Three Months Ended June 30, 2025 Annuities Life Run-off Corporate & Other Total (In millions) Net income (loss) available to shareholders $ 310 $ (40) $ 152 $ (362) $ 60 Add: Provision for income tax expense (benefit) 78 (7) (430) 367 8 Income (loss) available to shareholders before provision for income tax 388 (47) (278) 5 68 Less: Net investment gains (losses) (71) — (4) 36 (39) Less: Investment gains (losses) on trading securities (6) — — — (6) Less: Net derivative gains (losses), excluding investment hedge adjustments of $ 1 (1,052) (14) (169) (3) (1,238) Less: Change in market risk benefits 1,101 — — — 1,101 Less: Market value adjustments 6 — — — 6 Pre-tax adjusted earnings (loss), less net income (loss) attributable to noncontrolling interests and preferred stock dividends 410 (33) (105) (28) 244 Less: Provision for income tax expense (benefit) 78 (7) (22) (3) 46 Adjusted earnings (loss) $ 332 $ (26) $ (83) $ (25) $ 198 Three Months Ended June 30, 2024 Annuities Life Run-off Corporate & Other Total (In millions) Net income (loss) available to shareholders $ 38 $ 38 $ 22 $ (89) $ 9 Add: Provision for income tax expense (benefit) 78 10 (164) 56 (20) Income (loss) available to shareholders before provision for income tax 116 48 (142) (33) (11) Less: Net investment gains (losses) (81) (7) (15) (17) (120) Less: Investment gains (losses) on trading securities — — — — — Less: Net derivative gains (losses), excluding investment hedge adjustments of $ 9 (569) 3 (96) (9) (671) Less: Change in market risk benefits 356 — — — 356 Less: Market value adjustments — — 6 — 6 Pre-tax adjusted earnings (loss), less net income (loss) attributable to noncontrolling interests and preferred stock dividends 410 52 (37) (7) 418 Less: Provision for income tax expense (benefit) 78 10 (7) (9) 72 Adjusted earnings (loss) $ 332 $ 42 $ (30) $ 2 $ 346 65 Table of Contents Six Months Ended June 30, 2025 Annuities Life Run-off Corporate & Other Total (In millions) Net income (loss) available to shareholders $ (29) $ (41) $ (127) $ (37) $ (234) Add: Provision for income tax expense (benefit) 151 (6) (235) 10 (80) Income (loss) available to shareholders before provision for income tax 122 (47) (362) (27) (314) Less: Net investment gains (losses) (123) (4) (22) 27 (122) Less: Investment gains (losses) on trading securities — — — — — Less: Net derivative gains (losses), excluding investment hedge adjustments of $ 1 (760) (20) (150) 3 (927) Less: Change in market risk benefits 208 — — — 208 Less: Market value adjustments — — (4) — (4) Pre-tax adjusted earnings (loss), less net income (loss) attributable to noncontrolling interests and preferred stock dividends 797 (23) (186) (57) 531 Less: Provision for income tax expense (benefit) 151 (6) (39) (8) 98 Adjusted earnings (loss) $ 646 $ (17) $ (147) $ (49) $ 433 Six Months Ended June 30, 2024 Annuities Life Run-off Corporate & Other Total (In millions) Net income (loss) available to shareholders $ 23 $ (8) $ (142) $ (383) $ (510) Add: Provision for income tax expense (benefit) 150 — (638) 345 (143) Income (loss) available to shareholders before provision for income tax 173 (8) (780) (38) (653) Less: Net investment gains (losses) (105) (23) (21) (13) (162) Less: Investment gains (losses) on trading securities — — — — — Less: Net derivative gains (losses), excluding investment hedge adjustments of $ 22 (2,313) 9 (300) (1) (2,605) Less: Change in market risk benefits 1,796 — — — 1,796 Less: Market value adjustments — — 10 — 10 Pre-tax adjusted earnings (loss), less net income (loss) attributable to noncontrolling interests and preferred stock dividends 795 6 (469) (24) 308 Less: Provision for income tax expense (benefit) 150 — (98) 8 60 Adjusted earnings (loss) $ 645 $ 6 $ (371) $ (32) $ 248 66 Table of Contents Consolidated Results for the Three Months and Six Months Ended June 30, 2025 and 2024 — Adjusted Earnings (Loss) The components of adjusted earnings (loss) were as follows: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (In millions) Fee income $ 696 $ 721 $ 1,375 $ 1,302 Net investment spread 720 773 1,431 1,506 Insurance-related activities (516) (433) (950) (1,171) Amortization of DAC and VOBA (149) (150) (297) (301) Other expenses (482) (468) (975) (975) Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends 25 25 53 53 Pre-tax adjusted earnings (loss), less net income (loss) attributable to noncontrolling interests and preferred stock dividends 244 418 531 308 Provision for income tax expense (benefit) 46 72 98 60 Adjusted earnings (loss) $ 198 $ 346 $ 433 $ 248 Three Months Ended June 30, 2025 Compared with the Three Months Ended June 30, 2024 Adjusted earnings were $198 million in the current period, a decrease of $148 million. Key net unfavorable impacts were: • higher net costs associated with insurance-related activities due to: ◦ higher claims, net of reinsurance in our Life and Run-off segments; partially offset by ◦ an increase in income annuity underwriting margins; • lower net investment spread due to: ◦ higher interest credited to policyholders due to higher account balances; and ◦ lower returns on other limited partnerships; partially offset by ◦ higher returns on real estate limited partnerships and limited liability companies (“LLC”); and ◦ higher average invested assets resulting from positive net flows in the general account; • lower net fee income due to: ◦ lower asset-based fees resulting from lower average separate account balances, a portion of which is offset in other expenses; and ◦ a decline in the net cost of insurance fees driven by the aging in-force business in our Run-off segment; partially offset by ◦ lower ceded cost of insurance fees consistent with favorable equity market returns in our Life segment, which is offset in other expenses; and • higher other expenses due to: ◦ lower ceded cost of insurance expenses consistent with favorable equity market returns in our Life segment, which is offset in fee income; and ◦ higher deferred compensation and operational expenses; partially offset by 67 Table of Contents ◦ lower asset-based variable annuity expenses resulting from lower average separate account balances, a portion of which is offset in fee income. The provision for income tax, expressed as a percentage of pre-tax adjusted earnings (loss), resulted in an effective tax rate of 17% in the current period compared to 16% in the prior period. Our effective tax rate differs from the statutory tax rate primarily due to the impacts of the dividends received deduction and tax credits. Six Months Ended June 30, 2025 Compared with the Six Months Ended June 30, 2024 Adjusted earnings were $433 million in the current period, an increase of $185 million. Key net favorable impacts were: • lower net costs associated with insurance-related activities due to: ◦ a decrease in liability balances in our Run-off segment resulting from a reinsurance premium rate increase associated with the conclusion of a reinsurance arbitration in the prior period; and ◦ an increase in income annuity underwriting margins; partially offset by ◦ higher claims, net of reinsurance, in our Life segment; • higher net fee income due to: ◦ lower ceded cost of insurance fees in our Life and Run-off segments related to the conclusion of the aforementioned reinsurance arbitration in the prior period; partially offset by ◦ lower asset-based fees resulting from lower average separate account balances, a portion of which is offset in other expenses; and ◦ a decline in the net cost of insurance fees driven by the aging in-force business in our Run-off segment; and • lower other expenses due to: ◦ the conclusion of the aforementioned reinsurance arbitration in our Life and Run-off segments in the prior period; ◦ lower asset-based variable annuity expenses resulting from lower average separate account balances, a portion of which is offset in fee income; and ◦ lower transition services agreement expenses; partially offset by ◦ higher operational expenses. The key unfavorable impact was a lower net investment spread due to higher interest credited to policyholders due to higher account balances and actuarial modeling improvements in our Annuities segment. The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in an effective tax rate of 17% in both the current period and the prior period. Our effective tax rate differs from the statutory tax rate primarily due to the impacts of the dividends received deduction, tax credits and current period non-recurring items. 68 Table of Contents Segment Results for the Three Months and Six Months Ended June 30, 2025 and 2024 — Adjusted Earnings (Loss) Annuities The components of adjusted earnings for our Annuities segment were as follows: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (In millions) Fee income $ 514 $ 549 $ 1,040 $ 1,094 Net investment spread 403 374 798 747 Insurance-related activities (38) (46) (83) (108) Amortization of DAC and VOBA (127) (126) (253) (253) Other expenses (342) (341) (705) (685) Pre-tax adjusted earnings 410 410 797 795 Provision for income tax expense (benefit) 78 78 151 150 Adjusted earnings $ 332 $ 332 $ 646 $ 645 A significant portion of our adjusted earnings is driven by separate account balances related to our variable annuity business, as these balances determine asset-based fee income and commissions. The changes in our variable annuities separate account balances are presented in Note 5 of the Notes to the Interim Condensed Consolidated Financial Statements. Three Months Ended June 30, 2025 Compared with the Three Months Ended June 30, 2024 Adjusted earnings were $332 million in the current and prior period. Key net favorable impacts were: • higher net investment spread due to: ◦ higher average invested assets resulting from positive net flows in the general account; ◦ higher returns on real estate limited partnerships and LLCs; and ◦ higher investment yields on our fixed income portfolio, as proceeds from maturing investments and the growth in the investment portfolio were invested at higher yields than the portfolio average; partially offset by ◦ higher interest credited to policyholders due to higher account balances; and • lower net costs associated with insurance-related activities due to an increase in income annuity underwriting margins. Key net unfavorable impacts were: • lower fee income due to lower asset-based fees resulting from lower average separate account balances, a portion of which is offset in other expenses; and • higher other expenses due to: ◦ higher deferred compensation and operational expenses; partially offset by ◦ lower asset-based variable annuity expenses resulting from lower average separate account balances, a portion of which is offset in fee income. The provision for income tax, calculated as a percentage of pre-tax adjusted earnings, resulted in an effective tax rate of 19% in both the current period and the prior period. Our effective tax rate differs from the statutory tax rate primarily due to the impacts of the dividends received deduction. 69 Table of Contents Six Months Ended June 30, 2025 Compared with the Six Months Ended June 30, 2024 Adjusted earnings were $646 million in the current period, an increase of $1 million. Key net favorable impacts were: • higher net investment spread due to: ◦ higher average invested assets resulting from positive net flows in the general account; ◦ higher returns on real estate limited partnerships and LLCs; and ◦ higher investment yields on our fixed income portfolio, as proceeds from maturing investments and the growth in the investment portfolio were invested at higher yields than the portfolio average; partially offset by ◦ higher interest credited to policyholders due to higher account balances and actuarial modeling improvements; and • lower net costs associated with insurance-related activities due to an increase in income annuity underwriting margins. Key net unfavorable impacts were: • lower fee income due to lower asset-based fees resulting from lower average separate account balances, a portion of which is offset in other expenses; and • higher other expenses due to: ◦ higher operational expenses; partially offset by ◦ lower asset-based variable annuity expenses resulting from lower average separate account balances, a portion of which is offset in fee income; and ◦ lower transition services agreement expenses. The provision for income tax, calculated as a percentage of pre-tax adjusted earnings, resulted in an effective tax rate of 19% in both the current period and the prior period. Our effective tax rate differs from the statutory tax rate primarily due to the impact of the dividends received deduction. Life The components of adjusted earnings (loss) for our Life segment were as follows: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (In millions) Fee income $ 82 $ 58 $ 145 $ 49 Net investment spread 40 68 91 122 Insurance-related activities (80) (9) (117) (12) Amortization of DAC and VOBA (22) (24) (44) (48) Other expenses (53) (41) (98) (105) Pre-tax adjusted earnings (loss) (33) 52 (23) 6 Provision for income tax expense (benefit) (7) 10 (6) — Adjusted earnings (loss) $ (26) $ 42 $ (17) $ 6 Three Months Ended June 30, 2025 Compared with the Three Months Ended June 30, 2024 Adjusted loss was $26 million in the current period, a decrease of $68 million. Key net unfavorable impacts were: • higher costs associated with insurance-related activities due to higher claims, net of reinsurance; 70 Table of Contents • lower net investment spread due to lower returns on other limited partnerships; and • higher other expenses due to: ◦ lower ceded cost of insurance expenses consistent with favorable equity market returns, which is offset in fee income; and ◦ higher operational expenses. The key favorable impact was higher fee income due to lower ceded cost of insurance fees consistent with favorable equity market returns, which is offset in other expenses. The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in an effective tax rate of 21% in the current period compared to 19% in the prior period. Our effective tax rate may differ from the statutory tax rate primarily due to the impact of the dividends received deduction. Six Months Ended June 30, 2025 Compared with the Six Months Ended June 30, 2024 Adjusted loss was $17 million in the current period, a decrease of $23 million. Key net unfavorable impacts were: • higher net costs associated with insurance-related activities due to higher claims, net of reinsurance; and • lower net investment spread due to lower returns on other limited partnerships. Key net favorable impacts were: • higher fee income due to lower ceded cost of insurance fees related to the conclusion of the aforementioned reinsurance arbitration in the prior period; and • lower other expenses due to: ◦ the conclusion of the aforementioned reinsurance arbitration in the prior period; partially offset by ◦ higher operational expenses. The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in a higher effective tax rate in the current period compared to the prior period. Our effective tax rate differs from the statutory tax rate primarily due to the impact of the dividends received deduction. Run-off The components of adjusted earnings (loss) for our Run-off segment were as follows: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (In millions) Fee income $ 97 $ 114 $ 192 $ 154 Net investment spread 225 262 437 509 Insurance-related activities (398) (378) (750) (1,051) Amortization of DAC and VOBA — — — — Other expenses (29) (35) (65) (81) Pre-tax adjusted earnings (loss) (105) (37) (186) (469) Provision for income tax expense (benefit) (22) (7) (39) (98) Adjusted earnings (loss) $ (83) $ (30) $ (147) $ (371) 71 Table of Contents Three Months Ended June 30, 2025 Compared with the Three Months Ended June 30, 2024 Adjusted loss was $83 million in the current period, a higher loss of $53 million. Key net unfavorable impacts were: • lower net investment spread due to: ◦ lower returns on other limited partnerships; and ◦ lower average invested long-term assets; • higher net costs associated with insurance-related activities due to higher claims, net of reinsurance; and • lower fee income due to a decline in the net cost of insurance fees driven by the aging in-force business. The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in an effective tax rate of 21% in the current period compared to 19% in the prior period. Our effective tax rate differs from the statutory tax rate primarily due to the impact of the dividends received deduction. Six Months Ended June 30, 2025 Compared with the Six Months Ended June 30, 2024 Adjusted loss was $147 million in the current period, a lower loss of $224 million. Key net favorable impacts were: • lower costs associated with insurance-related activities due to: ◦ a decrease in liability balances resulting from a reinsurance premium rate increase associated with the conclusion of the aforementioned reinsurance arbitration in the prior period; and ◦ lower claims, net of reinsurance; • higher net fee income due to: ◦ lower ceded cost of insurance fees related to the conclusion of the aforementioned reinsurance arbitration in the prior period; partially offset by ◦ a decline in the net cost of insurance fees driven by the aging in-force business; and • lower other expenses due to: ◦ the conclusion of the aforementioned reinsurance arbitration in the prior period; partially offset by ◦ higher operational expenses. The key unfavorable impact was a lower net investment spread due to: ◦ lower returns on other limited partnerships; and ◦ lower average invested long-term assets. The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in an effective tax rate of 21% in both the current period and the prior period. 72 Table of Contents Corporate & Other The components of adjusted earnings (loss) for our Corporate & Other segment were as follows: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (In millions) Fee income $ 3 $ — $ (2) $ 5 Net investment spread 52 69 105 128 Insurance-related activities — — — — Amortization of DAC and VOBA — — — — Other expenses (58) (51) (107) (104) Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends 25 25 53 53 Pre-tax adjusted earnings (loss), less net income (loss) attributable to noncontrolling interests and preferred stock dividends (28) (7) (57) (24) Provision for income tax expense (benefit) (3) (9) (8) 8 Adjusted earnings (loss) $ (25) $ 2 $ (49) $ (32) Three Months Ended June 30, 2025 Compared with the Three Months Ended June 30, 2024 Adjusted loss was $25 million in the current period, a decrease of $27 million. The key unfavorable impact was a lower net investment spread due to lower average invested long-term assets on our institutional spread margin business. The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in a lower effective tax rate in the current period compared to the prior period. Our effective tax rate differs from the statutory tax rate primarily due to the impacts of the dividends received deduction and tax credits. We believe the effective tax rate for the Corporate & Other segment is not generally meaningful, neither on a standalone basis nor for comparison to prior periods, since taxes for the Corporate & Other segment are derived from the difference between the overall consolidated effective tax rate and total taxes for the combined operating segments. Six Months Ended June 30, 2025 Compared with the Six Months Ended June 30, 2024 Adjusted loss was $49 million in the current period, a higher loss of $17 million. The key unfavorable impact was a lower net investment spread due to lower average invested long-term assets on our institutional spread margin business. The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in a higher effective tax rate in the current period compared to the prior period. Our effective tax rate differs from the statutory tax rate primarily due to the impacts of the dividends received deduction, tax credits and current period non-recurring items. We believe the effective tax rate for the Corporate & Other segment is not generally meaningful, neither on a standalone basis nor for comparison to prior periods, since taxes for the Corporate & Other segment are derived from the difference between the overall consolidated effective tax rate and total taxes for the other operating segments. 73 Table of Contents Annuity Guaranteed Benefits and Shield Annuity Liabilities for the Three Months and Six Months Ended June 30, 2025 and 2024 The overall impact on income (loss) available to shareholders before provision for income tax from the performance of annuity guaranteed benefits and Shield Annuity liabilities, which includes (i) changes in the fair value of liabilities and related reinsurance, (ii) fees net of claims and (iii) the mark-to-market of hedges, was as follows: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (In millions) Market risk benefits mark-to-market $ 1,020 $ 228 $ 21 $ 1,571 Annuity guaranteed benefit rider fees, net of claims 97 135 192 251 Ceded reinsurance (16) (7) (5) (26) Total changes attributable to annuity guaranteed benefits 1,101 356 208 1,796 Variable annuity hedges 1,073 137 196 204 Shield embedded derivatives (2,103) (697) (932) (2,514) Total $ 71 $ (204) $ (528) $ (514) Three Months Ended June 30, 2025 Annuity guaranteed benefits and Shield Annuity liabilities performance was favorable for the three months ended June 30, 2025, primarily driven by: • favorable decreases in annuity guaranteed benefits liabilities due to increasing equity markets and interest rates; • favorable changes in variable annuity hedges due to increasing equity markets, partially offset by increasing long-term interest rates; and • unfavorable changes in Shield embedded derivatives due to increasing equity markets. Three Months Ended June 30, 2024 Annuity guaranteed benefits and Shield Annuity liabilities performance was unfavorable for the three months ended June 30, 2024, primarily driven by: • favorable decreases in annuity guaranteed benefits liabilities due to increasing interest rates; • favorable changes in variable annuity hedges due to increasing equity markets, partially offset by increasing long-term interest rates; and • unfavorable changes in Shield embedded derivatives due to increasing equity markets. Six Months Ended June 30, 2025 Annuity guaranteed benefits and Shield Annuity liabilities performance was unfavorable for the six months ended June 30, 2025, primarily driven by: • favorable decreases in annuity guaranteed benefits liabilities due to increasing equity markets, partially offset by decreasing interest rates; • favorable changes in variable annuity hedges due to decreasing long-term interest rates and increasing equity markets; and • unfavorable changes in Shield embedded derivatives due to increasing equity markets. Six Months Ended June 30, 2024 Annuity guaranteed benefits and Shield Annuity liabilities performance was unfavorable for the six months ended June 30, 2024, primarily driven by: • favorable decreases in annuity guaranteed benefits liabilities due to increasing interest rates and equity markets; • favorable changes in variable annuity hedges due to increasing equity markets, partially offset by increasing long-term interest rates; and 74 Table of Contents • unfavorable changes in Shield embedded derivatives due to increasing equity markets. Investments Investment Risk Management Strategy We manage the risks related to our investment portfolio through asset-type allocation as well as industry and issuer diversification. We also use risk limits to promote diversification by asset sector, avoid concentrations in any single issuer and limit overall aggregate credit and equity risk exposure. We manage real estate risk through geographic, property type and product type diversification and asset allocation. Interest rate risk is managed as part of our Asset Liability Management (“ALM”) strategies. We also utilize product design to manage interest rate risk (e.g., market value adjustment features and surrender charges). These ALM strategies include maintaining an investment portfolio that targets a weighted average duration that reflects the duration of our estimated liability cash flow profile. For certain of our liability portfolios, it is not possible to invest assets for the full liability duration, thereby creating some asset/liability mismatch. We also use certain derivatives in the management of credit, interest rate, equity market and foreign currency exchange rate risks. Investment Management Agreements Other than our derivatives trading, which we manage in-house, we have engaged a select group of experienced external asset management firms to manage the investment of the assets comprising our general account portfolio and certain separate account assets of our insurance subsidiaries, as well as assets of BHF and our reinsurance subsidiary, BRCD. Current Environment Our business and results of operations are materially affected by conditions in capital markets and the economy, generally. As a U.S. insurance company, we are affected by the monetary policy of the Federal Reserve in the U.S. In 2024, the Federal Reserve decreased the target range for the federal funds rate three times — from between 5.25% and 5.50% to between 4.25% and 4.50%. The Federal Reserve may increase or decrease the federal funds rate in the future, which may have an impact on the pricing levels of risk-bearing investments and may adversely impact the level of product sales. We are also affected by the monetary policy of central banks around the world due to the diversification of our investment portfolio. See “— Industry Trends and Uncertainties — Financial and Economic Environment.” Interest rate increases have contributed to the net unrealized loss position in our investment portfolio. As a result of increases in interest rates, the unrealized losses on our fixed maturity securities exceeded the unrealized gains as of June 30, 2025. See “Risk Factors — Risks Related to Our Investment Portfolio — Our investment portfolio is subject to significant financial risks both in the U.S. and global financial markets, including credit risk, interest rate risk, inflation risk, market valuation risk, liquidity risk, real estate risk, derivatives risk, and other factors outside our control, the occurrence of any of which could have a material adverse effect on our financial condition and results of operations” included in our 2024 Annual Report. Selected Sector Investments Market volatility has affected the performance of various asset classes. See “Risk Factors — Risks Related to Our Investment Portfolio — Our investment portfolio is subject to significant financial risks both in the U.S. and global financial markets, including credit risk, interest rate risk, inflation risk, market valuation risk, liquidity risk, real estate risk, derivatives risk, and other factors outside our control, the occurrence of any of which could have a material adverse effect on our financial condition and results of operations,” and “Risk Factors — Risks Related to Our Investment Portfolio — Ongoing military actions, the continued threat of terrorism, climate change as well as other catastrophic events may adversely affect the value of our investment portfolio and the level of claim losses we incur” included in our 2024 Annual Report. There has been a continued market focus on commercial real estate, including office properties, as a result of hybrid work arrangements and the resulting impact on the demand for office space. We have direct commercial real estate exposure through mortgage loans and certain structured securities, which include residential mortgage-backed securities (“RMBS”), commercial mortgage-backed securities (“CMBS”) and asset-backed securities (“ABS”) (collectively, “Structured Securities”). In addition, we have direct and indirect exposure through certain financial industry corporate fixed maturity securities. See “— Investments — Mortgage Loans” and Note 7 of the Notes to the Interim Condensed Consolidated Financial Statements for information on mortgage loans, including credit quality by portfolio segment and commercial mortgage loans by property type. Additionally, see “— Investments — Fixed Maturity Securities Available-For-Sale — Structured Securities” for information on Structured Securities, including 75 Table of Contents security type, risk profile and ratings profile as well as “— Investments — Fixed Maturity Securities Available-For-Sale — U.S. and Foreign Corporate Fixed Maturity Securities” for our exposure to the finance industry. We monitor direct and indirect investment exposure across sectors and asset classes and adjust our level of investment exposure, as appropriate. At this time, we do not expect that our general account investments in these sectors and asset classes will have a material adverse effect on our results of operations or financial condition. Investment Portfolio Results The following summary yield table presents the yield and adjusted net investment income for our investment portfolio for the periods indicated. As described below, this table reflects certain differences from the presentation of net investment income presented in the GAAP statements of operations. This summary yield table presentation is consistent with how we measure our investment performance for management purposes, and we believe it enhances understanding of our investment portfolio results. Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Yield % Amount Yield % Amount Yield % Amount Yield % Amount (Dollars in millions) Investment income (1) 4.41 % $ 1,329 4.52 % $ 1,353 4.40 % $ 2,659 4.45 % $ 2,658 Investment fees and expenses (2) (0.13) (37) (0.13) (37) (0.13) (76) (0.14) (75) Adjusted net investment income (3) 4.28 % $ 1,292 4.39 % $ 1,316 4.27 % $ 2,583 4.31 % $ 2,583 _______________ (1) Investment income yields are calculated as investment income as a percentage of average quarterly asset carrying values. Investment income excludes recognized gains and losses and reflects the adjustments discussed in table note (3) below to arrive at adjusted net investment income. Asset carrying values exclude unrealized gains (losses), collateral received in connection with our securities lending program, freestanding derivative assets and collateral received from derivative counterparties. (2) Investment fee and expense yields are calculated as a percentage of average quarterly asset estimated fair values. Asset estimated fair values exclude collateral received in connection with our securities lending program, freestanding derivative assets and collateral received from derivative counterparties. (3) Adjusted net investment income presented in the yield table varies from the most directly comparable GAAP measure due to certain reclassifications, as presented below. Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (In millions) Net investment income $ 1,285 $ 1,307 $ 2,582 $ 2,561 Add: Investment hedge adjustments 1 9 1 22 Less: Investment gains (losses) on trading securities (6) — — — Adjusted net investment income — in the above yield table $ 1,292 $ 1,316 $ 2,583 $ 2,583 See “— Results of Operations — Consolidated Results for the Three Months and Six Months Ended June 30, 2025 and 2024” for an analysis of the period-over-period changes in net investment income. 76 Table of Contents Fixed Maturity Securities Available-For-Sale Fixed maturity securities held by type (public or private) were as follows at: June 30, 2025 December 31, 2024 Estimated Fair Value % of Total Estimated Fair Value % of Total (Dollars in millions) Publicly-traded $ 66,653 82.5 % $ 66,402 82.9 % Privately-placed 14,182 17.5 13,653 17.1 Total fixed maturity securities $ 80,835 100.0 % $ 80,055 100.0 % Percentage of cash and invested assets 64.0 % 65.4 % See Note 9 of the Notes to the Interim Condensed Consolidated Financial Statements for further information on our valuation controls and procedures including our formal process to challenge any prices received from independent pricing services that are not considered representative of estimated fair value. See Notes 1 and 7 of the Notes to the Interim Condensed Consolidated Financial Statements for further information about fixed maturity securities by sector, contractual maturities, continuous gross unrealized losses and the allowance for credit losses. Fixed Maturity Securities Credit Quality — Ratings See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Investments — Fixed Maturity Securities Available-For-Sale — Fixed Maturity Securities Credit Quality — Ratings” included in our 2024 Annual Report for a discussion of the credit quality ratings assigned by Nationally Recognized Statistical Rating Organizations (“NRSRO”), credit quality designations assigned by and methodologies used by the Securities Valuation Office of the National Association of Insurance Commissioners (“NAIC”) for fixed maturity securities and the methodologies adopted by the NAIC for certain Structured Securities. The following table presents total fixed maturity securities by NRSRO rating and the applicable NAIC designation from the NAIC published comparison of NRSRO ratings to NAIC designations, except for certain Structured Securities, which are presented using the NAIC methodologies, as well as the percentage, based on estimated fair value that each NAIC designation is comprised of at: June 30, 2025 December 31, 2024 NAIC Designation NRSRO Rating Amortized Cost Allowance for Credit Losses Unrealized Gain (Loss) Estimated Fair Value % of Total Amortized Cost Allowance for Credit Losses Unrealized Gain (Loss) Estimated Fair Value % of Total (Dollars in millions) 1 Aaa/Aa/A $ 57,038 $ 4 $ (3,838) $ 53,196 65.8 % $ 56,661 $ 5 $ (4,680) $ 51,976 64.9 % 2 Baa 27,264 — (1,925) 25,339 31.3 28,446 — (2,640) 25,806 32.3 Subtotal investment grade 84,302 4 (5,763) 78,535 97.1 % 85,107 5 (7,320) 77,782 97.2 % 3 Ba 1,888 2 (43) 1,843 2.3 1,879 — (92) 1,787 2.2 4 B 376 — (30) 346 0.5 383 2 (32) 349 0.4 5 Caa and lower 145 38 (16) 91 0.1 151 31 (13) 107 0.1 6 In or near default 51 23 (8) 20 — 83 43 (10) 30 0.1 Subtotal below investment grade 2,460 63 (97) 2,300 2.9 % 2,496 76 (147) 2,273 2.8 % Total fixed maturity securities $ 86,762 $ 67 $ (5,860) $ 80,835 100.0 % $ 87,603 $ 81 $ (7,467) $ 80,055 100.0 % 77 Table of Contents The following tables present total fixed maturity securities, based on estimated fair value, by sector classification and by NRSRO rating and the applicable NAIC designations from the NAIC published comparison of NRSRO ratings to NAIC designations, except for certain Structured Securities, which are presented using the NAIC methodologies as described above: Fixed Maturity Securities — by Sector & Credit Quality Rating NAIC Designation 1 2 3 4 5 6 Total Estimated Fair Value NRSRO Rating Aaa/Aa/A Baa Ba B Caa and Lower In or Near Default (In millions) June 30, 2025 U.S. corporate $ 17,773 $ 18,047 $ 1,431 $ 255 $ 47 $ 20 $ 37,573 Foreign corporate 5,213 6,150 296 73 37 — 11,769 RMBS 7,824 1 9 — 1 — 7,835 U.S. government and agency 6,554 82 — — — — 6,636 CMBS 5,994 333 35 8 4 — 6,374 ABS 5,795 350 29 10 2 — 6,186 State and political subdivision 3,471 50 — — — — 3,521 Foreign government 572 326 43 — — — 941 Total fixed maturity securities $ 53,196 $ 25,339 $ 1,843 $ 346 $ 91 $ 20 $ 80,835 December 31, 2024 U.S. corporate $ 17,036 $ 18,415 $ 1,303 $ 291 $ 49 $ 29 $ 37,123 Foreign corporate 5,327 6,026 391 41 45 — 11,830 RMBS 7,254 15 16 — 1 1 7,287 U.S. government and agency 6,636 111 — — — — 6,747 CMBS 5,985 344 17 6 4 — 6,356 ABS 5,776 498 19 11 8 — 6,312 State and political subdivision 3,390 51 — — — — 3,441 Foreign government 572 346 41 — — — 959 Total fixed maturity securities $ 51,976 $ 25,806 $ 1,787 $ 349 $ 107 $ 30 $ 80,055 U.S. and Foreign Corporate Fixed Maturity Securities We maintain a diversified portfolio of corporate fixed maturity securities across industries and issuers. Our portfolio does not have any exposure to any single issuer in excess of 1% of total investments and the top ten holdings in aggregate comprise 1% total investments at both June 30, 2025 and December 31, 2024. Our U.S. and foreign corporate fixed maturity securities holdings by industry were as follows at: June 30, 2025 December 31, 2024 Estimated Fair Value % of Total Estimated Fair Value % of Total (Dollars in millions) Industrial $ 15,872 32.2 % $ 15,448 31.6 % Finance 13,067 26.5 13,279 27.1 Consumer 11,363 23.0 11,155 22.8 Utility 6,385 12.9 6,405 13.1 Communications 2,655 5.4 2,666 5.4 Total $ 49,342 100.0 % $ 48,953 100.0 % 78 Table of Contents Structured Securities We held $20.4 billion and $20.0 billion of Structured Securities, at estimated fair value, at June 30, 2025 and December 31, 2024, respectively, as presented in the RMBS, CMBS and ABS sections below. RMBS Our RMBS holdings are diversified by security type, risk profile and ratings profile, which were as follows at: June 30, 2025 December 31, 2024 Estimated Fair Value % of Total Net Unrealized Gains (Losses) Estimated Fair Value % of Total Net Unrealized Gains (Losses) (Dollars in millions) Security type: Collateralized mortgage obligations $ 4,215 53.8 % $ (208) $ 3,906 53.6 % $ (304) Pass-through securities 3,620 46.2 (436) 3,381 46.4 (525) Total RMBS $ 7,835 100.0 % $ (644) $ 7,287 100.0 % $ (829) Risk profile: Agency $ 6,101 77.9 % $ (640) $ 5,752 78.9 % $ (800) Prime 221 2.8 (14) 220 3.0 (19) Alt-A 1,201 15.3 4 992 13.6 (11) Sub-prime 312 4.0 6 323 4.5 1 Total RMBS $ 7,835 100.0 % $ (644) $ 7,287 100.0 % $ (829) Ratings profile: Rated Aaa $ 1,125 14.4 % $ 892 12.2 % Designated NAIC 1 $ 7,824 99.9 % $ 7,254 99.5 % Historically, our exposure to sub-prime RMBS holdings has been managed by focusing primarily on senior tranche securities, stress-testing the portfolio with severe loss assumptions and closely monitoring the performance of the portfolio. Our sub-prime RMBS portfolio consists predominantly of securities that were purchased after 2012 at significant discounts to par value and discounts to the expected principal recovery value of these securities. The vast majority of these securities are investment grade under the NAIC designations (e.g., NAIC 1 and NAIC 2). 79 Table of Contents CMBS Our CMBS holdings are diversified by vintage year, which were as follows at: June 30, 2025 December 31, 2024 Amortized Cost Estimated Fair Value Amortized Cost Estimated Fair Value (In millions) 2005 - 2011 $ 59 $ 55 $ 81 $ 76 2012 — — 2 1 2013 17 15 21 19 2014 136 122 143 125 2015 682 660 929 895 2016 466 454 460 442 2017 698 675 689 652 2018 1,588 1,534 1,612 1,524 2019 909 834 912 807 2020 509 449 501 425 2021 599 575 664 635 2022 393 389 419 411 2023 78 78 61 62 2024 345 349 282 282 2025 184 185 — — Total $ 6,663 $ 6,374 $ 6,776 $ 6,356 The estimated fair value of CMBS rated Aaa using rating agency ratings was $4.2 billion, or 66.2% of total CMBS, and designated NAIC 1 was $6.0 billion, or 94.0% of total CMBS, at June 30, 2025. The estimated fair value of CMBS rated Aaa using rating agency ratings was $4.3 billion, or 67.7% of total CMBS, and designated NAIC 1 was $6.0 billion, or 94.2% of total CMBS, at December 31, 2024. ABS Our ABS holdings are diversified by both collateral type and issuer. Our ABS holdings by collateral type and ratings profile were as follows at: June 30, 2025 December 31, 2024 Estimated Fair Value % of Total Net Unrealized Gains (Losses) Estimated Fair Value % of Total Net Unrealized Gains (Losses) (Dollars in millions) Collateral type: Collateralized obligations $ 2,980 48.2 % $ — $ 3,258 51.6 % $ 14 Automobile loans 769 12.4 6 670 10.6 2 Student loans 391 6.3 (8) 383 6.1 (12) Consumer loans 346 5.6 (3) 354 5.6 (8) Credit card loans 320 5.2 — 326 5.2 (2) Other loans 1,380 22.3 (24) 1,321 20.9 (36) Total $ 6,186 100.0 % $ (29) $ 6,312 100.0 % $ (42) Ratings profile: Rated Aaa $ 3,874 62.6 % $ 3,764 59.6 % Designated NAIC 1 $ 5,795 93.7 % $ 5,776 91.5 % Allowance for Credit Losses for Fixed Maturity Securities See Note 7 of the Notes to the Interim Condensed Consolidated Financial Statements for information about the evaluation of fixed maturity securities for an allowance for credit losses or write-offs due to uncollectibility. 80 Table of Contents Securities Lending We participate in a securities lending program whereby securities are loaned to third parties, primarily brokerage firms and commercial banks. We obtain collateral, usually cash, in an amount generally equal to 102% of the estimated fair value of the securities loaned, which is obtained at the inception of a loan and maintained at a level greater than or equal to 100% for the duration of the loan. The estimated fair value of the securities loaned is monitored on a daily basis with additional collateral obtained as necessary throughout the duration of the loan. Securities loaned under such transactions may be sold or re-pledged by the transferee. We are liable to return to our counterparties the cash collateral under our control. Security collateral received from counterparties may not be sold or re-pledged, unless the counterparty is in default, and is not reflected in the financial statements. These transactions are treated as financing arrangements and the associated cash collateral liability is recorded at the amount of the cash received. See “— Liquidity and Capital Resources — The Company — Primary Uses of Liquidity and Capital — Securities Lending” and Note 7 of the Notes to the Interim Condensed Consolidated Financial Statements for information regarding our securities lending program. Mortgage Loans Our mortgage loans are principally collateralized by commercial, agricultural and residential properties. Information regarding mortgage loans by portfolio segment is summarized as follows at: June 30, 2025 December 31, 2024 Amortized Cost % of Total Allowance for Credit Losses % of Amortized Cost Amortized Cost % of Total Allowance for Credit Losses % of Amortized Cost (Dollars in millions) Commercial $ 12,916 55.7 % $ 146 1.1 % $ 13,330 56.8 % $ 106 0.8 % Agricultural 4,509 19.4 22 0.5%. 4,591 19.6 30 0.7 % Residential 5,777 24.9 41 0.7 % 5,543 23.6 42 0.8 % Total $ 23,202 100.0 % $ 209 0.9 % $ 23,464 100.0 % $ 178 0.8 % Our mortgage loan portfolio is diversified by both geographic region and property type to reduce the risk of concentration. The percentage of our commercial and agricultural mortgage loan portfolios collateralized by properties located in the U.S. was 98% at both June 30, 2025 and December 31, 2024. The remainder was collateralized by properties located outside of the U.S. At June 30, 2025, the carrying value as a percentage of total commercial and agricultural mortgage loans for the top three states in the U.S. was 17% for California, 11% for Texas and 8% for New York. Additionally, we manage risk when originating commercial and agricultural mortgage loans by generally lending up to 75% of the estimated fair value of the underlying real estate collateral. Our residential mortgage loan portfolio is managed in a similar manner to reduce risk of concentration. All residential mortgage loans were collateralized by properties located in the U.S. at both June 30, 2025 and December 31, 2024. At June 30, 2025, the carrying value as a percentage of total residential mortgage loans for the top three states in the U.S. was 37% for California, 10% for Florida and 6% for New York. 81 Table of Contents Commercial Mortgage Loans by Geographic Region and Property Type . Commercial mortgage loans are the largest component of the mortgage loan invested asset class. The diversification across geographic regions and property types of commercial mortgage loans was as follows at: June 30, 2025 December 31, 2024 Amount % of Total Amount % of Total (Dollars in millions) Geographic region: South Atlantic $ 2,682 20.8 % $ 2,769 20.8 % Pacific 2,532 19.6 2,644 19.8 Middle Atlantic 2,077 16.1 2,075 15.6 West South Central 1,593 12.3 1,555 11.7 Mountain 1,104 8.5 1,114 8.4 East North Central 822 6.4 834 6.2 New England 575 4.5 726 5.4 East South Central 362 2.8 363 2.7 West North Central 355 2.7 358 2.7 International 333 2.6 391 2.9 Multi-region and Other 481 3.7 501 3.8 Total recorded investment 12,916 100.0 % 13,330 100.0 % Less: allowance for credit losses 146 106 Carrying value, net of allowance for credit losses $ 12,770 $ 13,224 Property type: Apartment $ 4,956 38.4 % $ 5,249 39.4 % Office 2,955 22.9 3,019 22.7 Industrial 2,408 18.6 2,498 18.7 Retail 1,710 13.2 1,681 12.6 Hotel 887 6.9 883 6.6 Total recorded investment 12,916 100.0 % 13,330 100.0 % Less: allowance for credit losses 146 106 Carrying value, net of allowance for credit losses $ 12,770 $ 13,224 Mortgage Loan Credit Quality — Monitoring Process. Our mortgage loan investments are monitored on an ongoing basis, including a review of loans that are current, past due, restructured and under foreclosure. Quarterly, we conduct a formal review of the portfolio with our investment managers. See Note 7 of the Notes to the Interim Condensed Consolidated Financial Statements for information on mortgage loans by credit quality indicator, past due status, nonaccrual status and modified mortgage loans. Our commercial mortgage loans are reviewed on an ongoing basis. These reviews may include an analysis of the property financial statements and rent roll, lease rollover analysis, property inspections, market analysis, estimated valuations of the underlying collateral, loan-to-value ratios, debt-service coverage ratios and tenant creditworthiness. The monitoring process focuses on higher risk loans, which include those that are classified as restructured, delinquent or in foreclosure, as well as loans with higher loan-to-value ratios and lower debt-service coverage ratios. The monitoring process for agricultural mortgage loans is generally similar, with a focus on higher risk loans, such as loans with higher loan-to-value ratios, including reviews on a geographic and sector basis. Our residential mortgage loans are reviewed on an ongoing basis. See Note 7 of the Notes to the Interim Condensed Consolidated Financial Statements for information on our evaluation of residential mortgage loans and related measurement of allowance for credit losses. 82 Table of Contents Loan-to-value ratios and debt-service coverage ratios are common measures in the assessment of the quality of commercial mortgage loans. Loan-to-value ratios are a common measure in the assessment of the quality of agricultural mortgage loans. Loan-to-value ratios compare the amount of the loan to the estimated fair value of the underlying collateral. A loan-to-value ratio greater than 100% indicates that the loan amount is greater than the collateral value. A loan-to-value ratio of less than 100% indicates an excess of collateral value over the loan amount. Generally, the higher the loan-to-value ratio, the higher the risk of experiencing a credit loss. The debt-service coverage ratio compares a property’s net operating income to amounts needed to service the principal and interest due under the loan. Generally, the lower the debt-service coverage ratio, the higher the risk of experiencing a credit loss. For our commercial mortgage loans, our average loan-to-value ratio was 68% and 69% at June 30, 2025 and December 31, 2024, respectively, and our average debt-service coverage ratio was 2.2x and 2.3x at June 30, 2025 and December 31, 2024, respectively. The debt-service coverage ratio, as well as the values utilized in calculating the ratio, is updated annually on a rolling basis, with a portion of the portfolio updated each quarter. In addition, the loan-to-value ratio is routinely updated for all but the lowest risk loans as part of our ongoing review of our commercial mortgage loan portfolio. For our agricultural mortgage loans, our average loan-to-value ratio was 46% and 48% at June 30, 2025 and December 31, 2024, respectively. The values utilized in calculating the agricultural mortgage loan loan-to-value ratio are developed in connection with the ongoing review of the agricultural loan portfolio and are routinely updated. Mortgage Loan Allowance for Credit Losses . See Note 7 of the Notes to the Interim Condensed Consolidated Financial Statements for information about how the allowance for credit losses is established and monitored, as well as activity in and balances of the allowance for credit losses for the six months ended June 30, 2025 and 2024. Limited Partnerships and Limited Liability Companies The carrying values of our limited partnerships and LLCs were as follows at: June 30, 2025 December 31, 2024 (In millions) Other limited partnerships $ 4,127 $ 4,100 Real estate limited partnerships and LLCs (1) 671 727 Total $ 4,798 $ 4,827 __________________ (1) The estimated fair value of real estate limited partnerships and LLCs was $746 million and $836 million at June 30, 2025 and December 31, 2024, respectively. Cash distributions on these investments are generated from investment gains, operating income from the underlying investments of the funds and liquidation of the underlying investments of the funds. We estimate that the underlying investment of the private equity funds will typically be liquidated over the next 10 to 20 years. Other Invested Assets The carrying value of our other invested assets by type was as follows at: June 30, 2025 December 31, 2024 Carrying Value % of Total Carrying Value % of Total (Dollars in millions) Freestanding derivatives with positive estimated fair values $ 7,803 87.4 % $ 4,135 78.8 % Company-owned life insurance 795 8.9 772 14.7 Federal Home Loan Bank stock 217 2.4 222 4.2 Leveraged leases, net of non-recourse debt 60 0.7 60 1.1 Tax credit and renewable energy partnerships 44 0.5 48 0.9 Other 13 0.1 13 0.3 Total $ 8,932 100.0 % $ 5,250 100.0 % 83 Table of Contents Derivatives Derivative Risks We are exposed to various risks relating to our ongoing business operations, including interest rate, foreign currency exchange rate, credit and equity market risks. We use a variety of strategies to manage these risks, including the use of derivatives. See Note 8 of the Notes to the Interim Condensed Consolidated Financial Statements for: • information about the gross notional amount, estimated fair value, and primary underlying risk exposure of our derivatives by type of hedge designation, excluding embedded derivatives held at June 30, 2025 and December 31, 2024; and • the effects of derivatives in cash flow, fair value, or non-qualifying hedge relationships on the statements of operations for the six months ended June 30, 2025 and 2024. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Risk Management Strategies” included in our 2024 Annual Report for more information about our hedging strategies. In addition, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations — Annual Actuarial Review” and “Risk Factors — Risks Related to Our Investment Portfolio — Our investment portfolio is subject to significant financial risks both in the U.S. and global financial markets, including credit risk, interest rate risk, inflation risk, market valuation risk, liquidity risk, real estate risk, derivatives risk, and other factors outside our control, the occurrence of any of which could have a material adverse effect on our financial condition and results of operations” included in our 2024 Annual Report. Fair Value Hierarchy See Note 9 of the Notes to the Interim Condensed Consolidated Financial Statements for derivatives measured at estimated fair value on a recurring basis and their corresponding fair value hierarchy, as well as a rollforward of the fair value measurements for derivatives measured at estimated fair value on a recurring basis using significant unobservable (Level 3) inputs as discussed below. The valuation of Level 3 derivatives involves the use of significant unobservable inputs and generally requires a higher degree of management judgment or estimation than the valuations of Level 1 and Level 2 derivatives. Although Level 3 inputs are unobservable, management believes they are consistent with what other market participants would use when pricing such instruments and are considered appropriate given the circumstances. The use of different inputs or methodologies could have a material effect on the estimated fair value of Level 3 derivatives and could materially affect net income. Derivatives categorized as Level 3 at June 30, 2025 include: credit default swaps priced using unobservable credit spreads, or that are priced through independent broker quotations; and foreign currency swaps with certain unobservable inputs. Credit Risk See Note 8 of the Notes to the Interim Condensed Consolidated Financial Statements for information about how we manage credit risk related to derivatives and for the estimated fair value of our net derivative assets and net derivative liabilities after the application of master netting agreements and collateral. See “Risk Factors — Risks Related to Our Investment Portfolio — Our investment portfolio is subject to significant financial risks both in the U.S. and global financial markets, including credit risk, interest rate risk, inflation risk, market valuation risk, liquidity risk, real estate risk, derivatives risk, and other factors outside our control, the occurrence of any of which could have a material adverse effect on our financial condition and results of operations” included in our 2024 Annual Report. Our policy is not to offset the fair value amounts recognized for derivatives executed with the same counterparty under the same master netting agreement. This policy applies to the recognition of derivatives on the balance sheet and does not affect our legal right of offset. 84 Table of Contents Credit Derivatives The gross notional amount and estimated fair value of credit default swaps were as follows at: June 30, 2025 December 31, 2024 Gross Notional Amount Estimated Fair Value Gross Notional Amount Estimated Fair Value (In millions) Written $ 1,230 $ 28 $ 780 $ 19 The maximum amount at risk related to our written credit default swaps is equal to the corresponding gross notional amount. In a replication transaction, we pair an asset on our balance sheet with a written credit default swap to synthetically replicate a corporate bond, a core asset holding of life insurance companies. Replications are entered into in accordance with the guidelines approved by state insurance regulators and the NAIC and are an important tool in managing the overall corporate credit risk within the Company. In order to match our long-dated insurance liabilities, we seek to buy long-dated corporate bonds. In some instances, these may not be readily available in the market, or they may be issued by corporations to which we already have significant corporate credit exposure. For example, by purchasing Treasury bonds (or other high-quality assets) and associating them with written credit default swaps on the desired corporate credit name, we can replicate the desired bond exposures and meet our ALM needs. This can expose the Company to changes in credit spreads as the written credit default swap tenor is shorter than the maturity of Treasury bonds. Embedded Derivatives See Note 9 of the Notes to the Interim Condensed Consolidated Financial Statements for (i) information about embedded derivatives measured at estimated fair value on a recurring basis and their corresponding fair value hierarchy and (ii) a rollforward of the fair value measurements for net embedded derivatives measured at estimated fair value on a recurring basis using significant unobservable (Level 3) inputs. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Summary of Critical Accounting Estimates — Derivatives” included in our 2024 Annual Report for additional information on the estimates and assumptions that affect embedded derivatives. Policyholder Liabilities We establish, and carry as liabilities, actuarially determined amounts that are calculated to meet policy obligations or to provide for future annuity and life insurance benefit payments. Amounts for actuarial liabilities are computed and reported in the financial statements in conformity with GAAP. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Summary of Critical Accounting Estimates” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Policyholder Liabilities” included in our 2024 Annual Report for more details on policyholder liabilities. Future Policy Benefits We establish liabilities for future amounts payable under insurance policies. See Note 3 of the Notes to the Interim Condensed Consolidated Financial Statements. Policyholder Account Balances Policyholder account balance liabilities are established for products with an explicit account value and generally equal to the balance accrued to the contract holder, which includes accrued interest credited, but excludes the impact of any applicable charge that may be incurred upon surrender. See Note 3 of the Notes to the Interim Condensed Consolidated Financial Statements. Market Risk Benefits We issue certain variable annuity products with guaranteed minimum benefits (“GMxB”) that provide the policyholder a minimum return based on their initial deposit (i.e., the Benefit Base) less withdrawals. In some cases, the Benefit Base may be increased by additional deposits, bonus amounts, accruals or optional market value step-ups. Variable annuity guaranteed benefits are classified as MRBs and measured at fair value. Certain index-linked annuity products may also have GMxBs classified as MRBs. See Note 4 of the Notes to the Interim Condensed Consolidated Financial Statements and “Quantitative and Qualitative Disclosures About Market Risk.” 85 Table of Contents Select information that management considers relevant to understanding our variable annuity risk management strategy has been included below. Net Amount at Risk The net amount at risk (“NAR”) for the guaranteed minimum income benefits (“GMIB”) is the amount (if any) that would be required to be added to the total account value to purchase a lifetime income stream, based on current annuity rates, equal to the minimum amount provided under the guaranteed benefit. This amount represents our potential economic exposure to such guarantees in the event all contract holders were to annuitize on the balance sheet date, even though the guaranteed amount under the contract may not be annuitized until after the waiting period of the contract. The NAR for the guaranteed minimum withdrawal benefits (“GMWB”) is the amount of guaranteed benefits in excess of the account values (if any) as of the balance sheet date and assumes utilization of benefits by all contract holders as of the balance sheet date. Only a small portion of the Benefit Base is available for withdrawal on an annual basis. The NAR for the guaranteed minimum accumulation benefits (“GMAB”) is the amount of guaranteed benefits in excess of the account values (if any) as of the balance sheet date and assumes utilization of benefits by all contract holders as of the balance sheet. The NAR for the GMAB is not available until the GMAB maturity date. The NAR for the guaranteed minimum death benefits (“GMDB”) is the amount of death benefit in excess of the account value (if any) as of the balance sheet date. It represents the amount of the claim we would incur if death claims were made on all contracts on the balance sheet date and includes any additional contractual claims associated with riders purchased to assist with covering income taxes payable upon death. Our variable annuity account value and NAR by type of GMxB were as follows at: June 30, 2025 December 31, 2024 Account Value Death Benefit NAR (1) Living Benefit NAR (1) % of Account Value In-the-Money (2) Account Value Death Benefit NAR (1) Living Benefit NAR (1) % of Account Value In-the-Money (2) (Dollars in millions) GMIB $ 29,952 $ 3,352 $ 3,644 28.7 % $ 30,280 $ 3,660 $ 4,085 33.5 % GMIB Max with EDB (3) 6,871 6,485 857 45.0 % 6,981 6,501 875 48.8 % GMIB Max without EDB (3) 3,878 81 236 30.4 % 3,941 111 247 33.6 % GMWB 19,242 163 197 6.6 % 19,263 237 276 10.1 % GMAB 219 — — — % 359 1 1 2.9 % GMDB only (other than EDB) (3) 17,113 939 — — 17,076 964 — N/A EDB only (3) 3,132 1,267 — — 3,084 1,343 — N/A Total $ 80,407 $ 12,287 $ 4,934 $ 80,984 $ 12,817 $ 5,484 __________________ (1) The “Death Benefit NAR” and “Living Benefit NAR” are not additive at the contract level. (2) In-the-money is defined as any contract with a living benefit NAR in excess of zero. (3) Enhanced Death Benefit (“EDB”). 86 Table of Contents Reserves Under GAAP, variable annuity guarantees are classified as MRBs, measured at estimated fair value, and are reported in market risk benefit assets and liabilities on the consolidated balance sheets, with changes reported in change in market risk benefits on the consolidated statements of operations, except for changes related to nonperformance risk, which are reported in other comprehensive income on the consolidated statements of comprehensive income (loss). Additionally, the index protection and accumulation features of Shield Annuities are accounted for as embedded derivatives, measured at estimated fair value, and are reported in policyholder account balances on the consolidated balance sheets, with changes reported in net derivative gains (losses) on the consolidated statements of operations. The Shield embedded derivative liabilities were valued at $10.5 billion at June 30, 2025. Our variable annuity MRBs by type of GMxB were as follows at: June 30, 2025 December 31, 2024 (In millions) GMIB $ 7,282 $ 7,560 GMWB 6 7 GMDB 741 740 Total $ 8,029 $ 8,307 The estimated fair value of these guarantees can change significantly due 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 markets inputs, as well as changes in nonperformance risk. See “Risk Factors — Risks Related to Our Business — Differences between actual experience and actuarial assumptions may adversely affect our financial results, capitalization and financial condition” and “Risk Factors — Risks Related to Our Business — Guarantees within certain of our annuity products may decrease our earnings, decrease our capitalization, increase the volatility of our results, result in higher risk management costs and expose us to increased market risk” included in our 2024 Annual Report. Liquidity and Capital Resources Our business and results of operations are materially affected by conditions in the global capital markets and the economy generally. Stressed conditions, volatility or disruptions in global capital markets, particular markets or financial asset classes can impact us adversely, in part because we have a large investment portfolio and our insurance liabilities and derivatives are sensitive to changing market factors. Changing conditions in the global capital markets and the economy may affect our financing costs and market interest rates for our debt or equity securities. For further information regarding market factors that could affect our ability to meet liquidity and capital needs, see “— Industry Trends and Uncertainties — Financial and Economic Environment,” as well as “Risk Factors — Economic Environment and Capital Markets-Related Risks” and “Risk Factors — Risks Related to Our Investment Portfolio” included in our 2024 Annual Report. Liquidity and Capital Management Based upon our capitalization, expectations regarding maintaining our business mix, ratings and funding sources available to us, we believe we have sufficient liquidity to meet business requirements in current market conditions and certain stress scenarios. BHF’s Board of Directors and senior management are directly involved in the governance of the capital management process, including proposed changes to the annual capital plan and capital targets. We continuously monitor and adjust our liquidity and capital plans in light of market conditions, as well as changing needs and opportunities. We maintain a substantial short-term liquidity position, which was $4.6 billion and $5.2 billion at June 30, 2025 and December 31, 2024, respectively. Short-term liquidity is comprised of cash and cash equivalents and short-term investments, excluding assets that are pledged or otherwise committed. Assets pledged or otherwise committed include amounts received in connection with securities lending, derivatives and assets held on deposit or in trust. An integral part of our liquidity management includes managing our level of liquid assets, which was $48.9 billion and $48.1 billion at June 30, 2025 and December 31, 2024, respectively. Liquid assets are comprised of cash and cash equivalents, short-term investments and publicly-traded securities, excluding assets that are pledged or otherwise committed. Assets pledged or otherwise committed include amounts received in connection with securities lending, funding agreements, derivatives and assets held on deposit or in trust. 87 Table of Contents The Company Liquidity Liquidity refers to our ability to generate adequate cash flows from our normal operations to meet the cash requirements of our operating, investing and financing activities. We determine our liquidity needs based on a rolling 12-month forecast by portfolio of invested assets, which we monitor daily. We adjust the general account asset and derivatives mix and general account asset maturities based on this rolling 12-month forecast. To support this forecast, we conduct cash flow and stress testing, which reflects the impact of various scenarios, including (i) the potential increase in our requirement to pledge additional collateral or return collateral to our counterparties, (ii) a reduction in new business sales, and (iii) the risk of early contract holder and policyholder withdrawals, as well as lapses and surrenders of existing policies and contracts. We include provisions limiting withdrawal rights in many of our products, which deter the customer from making withdrawals prior to the maturity date of the product. If significant cash is required beyond our anticipated liquidity needs, we have various alternatives available depending on market conditions and the amount and timing of the liquidity need. These available alternative sources of liquidity include cash flows from operations, sales of liquid assets and funding sources, including secured funding agreements, unsecured credit facilities and secured committed facilities. Under certain adverse market and economic conditions, our access to liquidity may deteriorate, or the cost to access liquidity may increase. See “Risk Factors — Economic Environment and Capital Markets-Related Risks — Adverse capital and credit market conditions may significantly affect our ability to meet liquidity needs and our access to capital” in our 2024 Annual Report. Capital We manage our capital position to maintain our financial strength and credit ratings. Our capital position is supported by our ability to generate cash flows within our insurance subsidiaries, our ability to effectively manage the risks of our businesses and our expected ability to borrow funds and raise additional capital to meet operating and growth needs under a variety of market and economic conditions. We monitor our debt-to-capital ratio using an average of our key leverage ratios as calculated by A.M. Best, Fitch, Moody’s and S&P, and we aim to maintain a ratio commensurate with our financial strength and credit ratings. As such, we may opportunistically look to pursue additional financing over time, which may include borrowings under credit facilities, the issuance of debt, equity or hybrid securities, the incurrence of term loans, or the refinancing or extinguishment of existing indebtedness. There can be no assurance that we will be able to complete any such financing transactions on terms and conditions favorable to us or at all. In support of our target combined risk-based capital (“RBC”) ratio of 400% to 450% in normal market conditions, we expect to continue to maintain a capital and risk management strategy that targets total assets supporting our variable annuity and Shield Annuity contracts at or above the average of the worst two percent of a set of capital markets scenarios over the life of the contracts level in normal market conditions. With our risk management focus on the core drivers of our combined RBC ratio, we believe we can better manage our RBC in stressed market scenarios. In November 2023, we authorized a $750 million share repurchase program under which repurchases may be made through open market purchases, including pursuant to Rule 10b5-1 plans or pursuant to accelerated stock repurchase plans, or through privately negotiated transactions, from time to time at management’s discretion in accordance with applicable legal requirements. Common stock repurchases are dependent upon several factors, including our capital position, liquidity, financial strength and credit ratings, general market conditions, the market price of our common stock compared to management’s assessment of the stock’s underlying value and applicable regulatory approvals, as well as other legal and accounting factors. We currently have no plans to declare and pay dividends on our common stock. Any future declaration and payment of dividends or other distributions or returns of capital will be at the discretion of BHF’s Board of Directors and will depend on and be subject to our financial condition, results of operations, cash needs, regulatory and other constraints, capital requirements (including capital requirements of our insurance subsidiaries), contractual restrictions and any other factors that BHF’s Board of Directors deems relevant in making such a determination. Therefore, there can be no assurance that we will pay any dividends or make other distributions or returns of capital on our common stock, or as to the amount of any such dividends, distributions or returns of capital. 88 Table of Contents Rating Agencies Rating agencies may continue to review and adjust our ratings. For example, in July 2025, S&P revised the long-term issuer credit ratings for BHF and Brighthouse Holdings, LLC (“BH Holdings”) to BBB from BBB+. In addition, S&P revised the financial strength ratings for certain of its subsidiaries to A from A+, among other revisions. See “Risk Factors — Risks Related to Our Business — A downgrade or a potential downgrade in our financial strength or credit ratings could result in a loss of business and materially adversely affect our financial condition and results of operations” included in our 2024 Annual Report for a description of the potential impact of a ratings downgrade. Sources and Uses of Liquidity and Capital Our primary sources and uses of liquidity and capital were as follows at: Six Months Ended June 30, 2025 2024 (In millions) Sources: Operating activities, net $ 145 $ — Investing activities, net 675 — Changes in policyholder account balances, net — 2,623 Changes in payables for collateral under securities loaned and other transactions, net 103 236 Total sources 923 2,859 Uses: Operating activities, net — 196 Investing activities, net — 1,707 Changes in policyholder account balances, net 146 — Long-term debt repaid 1 1 Dividends on preferred stock 51 51 Treasury stock acquired in connection with share repurchases 102 126 Financing element on certain derivative instruments and other derivative related transactions, net 114 175 Other, net 14 13 Total uses 428 2,269 Net increase (decrease) in cash and cash equivalents $ 495 $ 590 Cash Flows from Operating Activities The principal cash inflows from our insurance activities come from insurance premiums, annuity considerations and net investment income. The principal cash outflows are the result of various annuity and life insurance products, operating expenses and income tax, as well as interest expense. The primary liquidity concern with respect to these cash flows is the risk of early contract holder and policyholder withdrawal. Cash Flows from Investing Activities The principal cash inflows from our investment activities come from repayments of principal, proceeds from maturities and sales of investments, as well as settlements of freestanding derivatives. The principal cash outflows relate to purchases of investments and settlements of freestanding derivatives. We typically can have a net cash outflow from investing activities because cash inflows from insurance operations are reinvested in accordance with our ALM discipline to fund insurance liabilities. We closely monitor and manage these risks through our comprehensive investment risk management process. The primary liquidity concerns with respect to these cash flows are the risk of default by debtors and market disruption. 89 Table of Contents Cash Flows from Financing Activities The principal cash inflows from our financing activities come from issuances of debt and equity securities, deposits of funds associated with policyholder account balances and lending of securities. The principal cash outflows come from repayments of debt, common stock repurchases, preferred stock dividends, withdrawals associated with policyholder account balances and the return of securities on loan. The primary liquidity concerns with respect to these cash flows are market disruption and the risk of early policyholder withdrawal. Primary Sources of Liquidity and Capital In addition to the summary description of liquidity and capital sources discussed in “— Sources and Uses of Liquidity and Capital,” the following additional information is provided regarding our primary sources of liquidity and capital: Funding Sources Liquidity is provided by a variety of funding sources, including secured and unsecured funding agreements, unsecured credit facilities and secured committed facilities. Capital is provided by a variety of funding sources, including issuances of debt and equity securities, as well as borrowings under our credit facilities. We maintain a shelf registration statement with the SEC that permits the issuance of public debt, equity and hybrid securities. As a “Well-Known Seasoned Issuer” under SEC rules, our shelf registration statement provides for automatic effectiveness upon filing and has no stated issuance capacity. The diversity of our funding sources enhances our funding flexibility, limits dependence on any one market or source of funds and generally lowers the cost of funds. Our primary funding sources include: Preferred Stock See Note 10 of the Notes to the Interim Condensed Consolidated Financial Statements and Note 12 of the Notes to the Consolidated Financial Statements included in our 2024 Annual Report for information on preferred stock issuances. Funding Agreements Brighthouse Life Insurance Company issues funding agreements and uses the proceeds from such issuances for spread lending purposes in connection with our institutional spread margin business or to provide additional liquidity. The institutional spread margin business is comprised of funding agreements issued in connection with the programs described in more detail below. Activity related to these programs is reported in the Corporate & Other segment. See Note 3 of the Notes to the Consolidated Financial Statements included in our 2024 Annual Report for additional information on funding agreements. Funding Agreement-Backed Repurchase Agreement Program In January 2024, Brighthouse Life Insurance Company established a secured funding agreement-backed repurchase agreement program (the “FABR Program”), pursuant to which Brighthouse Life Insurance Company may enter into repurchase agreements with bank counterparties and the proceeds of the repurchase agreements are then used by a special purpose entity to purchase funding agreements from Brighthouse Life Insurance Company. Funding Agreement-Backed Commercial Paper Program In July 2021, Brighthouse Life Insurance Company established a funding agreement-backed commercial paper program (the “FABCP Program”) for spread lending purposes, pursuant to which a special purpose limited liability company (the “SPLLC”) may issue commercial paper and deposit the proceeds with Brighthouse Life Insurance Company under a funding agreement issued by Brighthouse Life Insurance Company to the SPLLC. The maximum aggregate principal amount permitted to be outstanding at any one time under the FABCP Program is $5.0 billion. Funding Agreement-Backed Notes Program In April 2021, Brighthouse Life Insurance Company established a funding agreement-backed notes program (the “FABN Program”), pursuant to which Brighthouse Life Insurance Company may issue funding agreements to a special purpose statutory trust for spread lending purposes. The maximum aggregate principal amount permitted to be outstanding at any one time under the FABN Program is $7.0 billion. Federal Home Loan Bank Funding Agreements Brighthouse Life Insurance Company is a member of the Federal Home Loan Bank (“FHLB”) of Atlanta, where it maintains a secured funding agreement program, under which funding agreements may be issued. 90 Table of Contents Farmer Mac Funding Agreements Brighthouse Life Insurance Company has a secured funding agreement program with the Federal Agricultural Mortgage Corporation and its affiliate Farmer Mac Mortgage Securities Corporation (“Farmer Mac”) with a term ending on December 1, 2026, pursuant to which the parties may enter into funding agreements in an aggregate amount of up to $750 million. Information regarding funding agreements issued for spread lending purposes is as follows: Aggregate Principal Amount Outstanding Issuances Repayments Six Months Ended June 30, June 30, 2025 December 31, 2024 2025 2024 2025 2024 (In millions) FABR Program $ 500 $ 500 $ — $ 500 $ — $ — FABCP Program 3,000 2,962 3,985 7,659 3,947 8,045 FABN Program 2,000 2,550 — 1,150 550 700 FHLB Funding Agreements 4,200 4,300 625 675 725 825 Farmer Mac Funding Agreements 450 650 — 50 200 100 Total $ 10,150 $ 10,962 $ 4,610 $ 10,034 $ 5,422 $ 9,670 Debt Issuances See Note 11 of the Notes to the Consolidated Financial Statements included in our 2024 Annual Report for information on debt issuances. Credit and Committed Facilities See Notes 11 and 12 of the Notes to the Consolidated Financial Statements included in our 2024 Annual Report for information regarding our credit and committed facilities. We have no reason to believe that our lending counterparties would be unable to fulfill their respective contractual obligations under these facilities. As commitments under our credit and committed facilities may expire unused, these amounts do not necessarily reflect our actual future cash funding requirements. Our Revolving Credit Facility contains financial covenants, including requirements to maintain a specified minimum adjusted consolidated net worth, to maintain a ratio of total indebtedness to total capitalization not in excess of a specified percentage and that place limitations on the dollar amount of indebtedness that may be incurred by our subsidiaries, which could restrict our operations and use of funds. At June 30, 2025, we were in compliance with these financial covenants. Primary Uses of Liquidity and Capital In addition to the summarized description of liquidity and capital uses discussed in “— Sources and Uses of Liquidity and Capital,” the following additional information is provided regarding our primary uses of liquidity and capital: Common Stock Repurchases See Note 10 of the Notes to the Interim Condensed Consolidated Financial Statements for information relating to authorizations to repurchase BHF common stock, amounts of common stock repurchased pursuant to such authorizations and the amount remaining under such authorizations at June 30, 2025. Preferred Stock Dividends See Note 10 of the Notes to the Interim Condensed Consolidated Financial Statements for information relating to dividends declared and paid on our preferred stock. 91 Table of Contents “Dividend Stopper” Provisions in BHF’s Preferred Stock and Junior Subordinated Debentures Terms applicable to our junior subordinated debentures may restrict our ability to pay interest on those debentures in certain circumstances. Suspension of payments of interest on our junior subordinated debentures, whether required under the relevant indenture or optional, could cause “dividend stopper” provisions applicable under those and other instruments to restrict our ability to pay dividends, if any, on our common stock and repurchase our common stock in various situations, including situations where we may be experiencing financial stress, and may restrict our ability to pay dividends or interest on our preferred stock and junior subordinated debentures as well. Similarly, the terms of our outstanding preferred stock contain restrictions on our ability to repurchase our common stock or pay dividends thereon if we have not fulfilled our dividend obligations under such preferred stock or other preferred securities. In addition, the terms of the agreements governing any preferred stock, debt or other financial instruments that we may issue in the future, may limit or prohibit the payment of dividends on our common stock or preferred stock, or the payment of interest on our junior subordinated debentures. Debt Repayments, Repurchases, Redemptions and Exchanges See Note 11 of the Notes to the Consolidated Financial Statements included in our 2024 Annual Report for information on debt repayments and repurchases, as well as debt maturities and the terms of our outstanding long-term debt. We may from time to time seek to retire or purchase our outstanding indebtedness through cash purchases or exchanges for other securities, purchases in the open market, privately negotiated transactions or otherwise. Any such repurchases or exchanges will be dependent upon several factors, including our liquidity requirements, contractual restrictions, general market conditions, as well as applicable regulatory, legal and accounting factors. Whether or not we repurchase any debt and the size and timing of any such repurchases will be determined at our discretion. Insurance Liabilities Liabilities arising from our insurance activities primarily relate to benefit payments under various annuity and life insurance products, as well as payments for policy surrenders, withdrawals and loans. See “— Primary Sources of Liquidity and Capital — Funding Sources — Funding Agreements” for additional information regarding our institutional spread margin business. Pledged Collateral We enter into derivatives to manage various risks relating to our ongoing business operations. We pledge collateral to, and have collateral pledged to us by, counterparties in connection with our derivatives. At June 30, 2025, we pledged less than $1 million of cash collateral to counterparties. At December 31, 2024, we did not pledge any cash collateral to counterparties. At June 30, 2025 and December 31, 2024, we were obligated to return cash collateral pledged to us by counterparties of $907 million and $812 million, respectively. The timing of the return of the derivatives collateral is uncertain. We also pledge collateral from time to time in connection with certain funding agreements. We receive non-cash collateral from counterparties for derivatives, which can be sold or re-pledged subject to certain constraints, and which is not recorded on our consolidated balance sheets. The amount of this non-cash collateral at estimated fair value was $1.8 billion and $2.3 billion at June 30, 2025 and December 31, 2024, respectively. See Note 8 of the Notes to the Interim Condensed Consolidated Financial Statements for additional information regarding pledged collateral. Securities Lending We have a securities lending program that aims to enhance the total return on our investment portfolio, whereby securities are loaned to third parties, primarily brokerage firms and commercial banks. We obtain collateral, usually cash, from the borrower, which must be returned to the borrower when the loaned securities are returned to us. Generally, our securities lending contracts expire within twelve months of issuance. We were liable for cash collateral under our control of $3.3 billion and $3.2 billion at June 30, 2025 and December 31, 2024, respectively. We receive non-cash collateral for securities lending from counterparties, which cannot be sold or re-pledged, and which is not recorded on our consolidated balance sheets. There was no non-cash collateral at both June 30, 2025 and December 31, 2024. See Note 7 of the Notes to the Interim Condensed Consolidated Financial Statements for further discussion of our securities lending program. 92 Table of Contents Contingencies, Commitments and Guarantees We establish liabilities for litigation, regulatory and other loss contingencies when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. See Note 13 of the Notes to the Interim Condensed Consolidated Financial Statements for additional information regarding contingencies. We enter into commitments for the purpose of enhancing the total return on our investment portfolio consisting of commitments to fund partnership investments, bank credit facilities and private corporate bond investments, as well as commitments to lend funds under mortgage loan commitments. We anticipate these commitments could be invested any time over the next five years. See Notes 7 and 13 of the Notes to the Interim Condensed Consolidated Financial Statements for additional information regarding commitments. In the normal course of our business, we have provided certain indemnities, guarantees and commitments to third parties such that we may be required to make payments now or in the future. See Note 13 of the Notes to the Interim Condensed Consolidated Financial Statements for additional information regarding guarantees. The Parent Company Liquidity and Capital In evaluating liquidity, it is important to distinguish the cash flow needs of the parent company from the cash flow needs of the combined group of companies. BHF is largely dependent on cash flows from its insurance subsidiaries to meet its obligations. Constraints on BHF’s liquidity may occur as a result of operational demands or as a result of compliance with regulatory requirements. Short-term Liquidity and Liquid Assets At June 30, 2025 and December 31, 2024, BHF and certain of its non-insurance subsidiaries had short-term liquidity of $803 million and $912 million, respectively. Short-term liquidity is comprised of cash and cash equivalents and short-term investments, excluding assets that are pledged or otherwise committed. Assets pledged or otherwise committed include assets held in trust. At June 30, 2025 and December 31, 2024, BHF and certain of its non-insurance subsidiaries had liquid assets of $941 million and $1.1 billion, respectively, of which $901 million and $1.1 billion, respectively, was held by BHF. Liquid assets are comprised of cash and cash equivalents, short-term investments and publicly-traded securities, excluding assets that are pledged or otherwise committed. Assets pledged or otherwise committed include assets held in trust. On February 11, 2025, Brighthouse Life Insurance Company received a $100 million capital contribution from BH Holdings. Statutory Capital and Dividends The NAIC and state insurance departments have established regulations that provide minimum capitalization requirements based on RBC formulas for 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 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. State insurance laws provide insurance regulators the authority to require various actions by, or take various actions against, insurers whose total adjusted capital (“TAC”) does not meet or exceed the amounts required to attain certain RBC levels. As of the date of the most recent annual statutory financial statements filed with insurance regulators, the TAC of each of our insurance subsidiaries subject to these requirements was in excess of the amounts required to attain each of those RBC levels. 93 Table of Contents The amount of dividends that our insurance subsidiaries can ultimately pay to BHF through their various parent entities provides an additional margin for risk protection and investment in our businesses. Such dividends are constrained by the amount of surplus our insurance subsidiaries hold to maintain their ratings, which is generally higher than minimum RBC requirements. We proactively take actions to maintain capital consistent with these ratings objectives, which may include adjusting dividend amounts and deploying financial resources from internal or external sources of capital. Certain of these activities may require regulatory approval. Furthermore, the payment of dividends and other distributions by our insurance subsidiaries is governed by the insurance laws and regulations of the states where they are domiciled. Any payment of dividends by Brighthouse Life Insurance Company in 2025 would be subject to Delaware Department of Insurance approval. See Note 12 of the Notes to the Consolidated Financial Statements included in our 2024 Annual Report for additional information regarding the applicable dividend restrictions and certain of our subsidiaries’ ordinary dividend capacity, as well as the circumstances under which regulatory approval would be required. Primary Sources and Uses of Liquidity and Capital The principal sources of funds available to BHF include distributions from BH Holdings, dividends and returns of capital from its insurance subsidiaries and BRCD, capital markets issuances, as well as its own cash and cash equivalents and short-term investments. These sources of funds may also be supplemented by alternate sources of liquidity either directly or indirectly through our insurance subsidiaries. For example, we have established internal liquidity facilities to provide liquidity within and across our regulated and non-regulated entities to support our businesses. The primary uses of liquidity of BHF include debt-service obligations (including interest expense and debt repayments), preferred stock dividends, capital contributions to subsidiaries, common stock repurchases and payment of general operating expenses. Based on our analysis and comparison of our current and future cash inflows from the dividends we receive from subsidiaries that are permitted to be paid without prior insurance regulatory approval, our investment portfolio and other cash flows and anticipated access to the capital markets, we believe there will be sufficient liquidity and capital to enable BHF to make payments on debt, pay preferred stock dividends, contribute capital to its subsidiaries, repurchase its common stock, pay all general operating expenses and meet its cash needs. In addition to the liquidity and capital sources discussed in “— The Company — Primary Sources of Liquidity and Capital” and “— The Company — Primary Uses of Liquidity and Capital,” the following additional information is provided regarding BHF’s primary sources and uses of liquidity and capital: Distributions from and Capital Contributions to BH Holdings During both the six months ended June 30, 2025 and 2024, BHF did not receive any cash distributions from BH Holdings and did not make any cash capital contributions to BH Holdings. Short-term Intercompany Loans BHF, as borrower, has a short-term intercompany loan agreement with certain of its non-insurance subsidiaries, as lenders, for the purposes of facilitating the management of the available cash of the borrower and the lenders on a short-term and consolidated basis. Such intercompany loan agreement allows management to optimize the efficient use of and maximize the yield on cash between BHF and its subsidiary lenders. Each loan entered into under this intercompany loan agreement has a term not more than 364 days and bears interest on the unpaid principal amount at a variable rate, payable monthly. During the six months ended June 30, 2025 and 2024, BHF borrowed $398 million and $290 million, respectively, from certain of its non-insurance subsidiaries and repaid $386 million and $85 million of such borrowings during the six months ended June 30, 2025 and 2024, respectively. At June 30, 2025 and December 31, 2024, BHF had total obligations outstanding of $594 million and $582 million, respectively, under such agreements. Intercompany Liquidity Facilities BHF has established intercompany liquidity facilities with certain of its insurance and non-insurance subsidiaries to provide short-term liquidity within and across the combined group of companies. Under these facilities, which are comprised of a series of revolving loan agreements among BHF and its participating subsidiaries, each company may lend to or borrow from each other, subject to certain maximum limits for a term of up to 364 days, depending on the agreement. During both the six months ended June 30, 2025 and 2024, there were no borrowings or repayments by BHF under these facilities and, at both June 30, 2025 and December 31, 2024, BHF had no obligations outstanding under such facilities. 94 Table of Contents Note Regarding Forward-Looking Statements This report and other oral or written statements that we make from time to time may contain information that includes or is based upon forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve substantial risks and uncertainties. We have tried, wherever possible, to identify such statements using words such as “anticipate,” “estimate,” “expect,” “project,” “may,” “will,” “could,” “intend,” “goal,” “target,” “guidance,” “forecast,” “preliminary,” “objective,” “continue,” “aim,” “plan,” “believe” and other words and terms of similar meaning, or that are tied to future periods, in connection with a discussion of future operating or financial performance. In particular, these include, without limitation, statements relating to future actions, prospective services or products, financial projections, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, as well as trends in operating and financial results. Any or all forward-looking statements may turn out to be wrong. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining the actual future results of Brighthouse Financial. These statements are based on current expectations and the current economic environment and involve a number of risks and uncertainties that are difficult to predict. These statements are not guarantees of future performance. Actual results could differ materially from those expressed or implied in the forward-looking statements due to a variety of known and unknown risks, uncertainties and other factors. Although it is not possible to identify all of these risks and factors, they include, among others: • differences between actual experience and actuarial assumptions and the effectiveness of our actuarial models; • higher risk management costs and exposure to increased market risk due to guarantees within certain of our products; • the effectiveness of our risk management strategy and the impacts of such strategy on volatility in our profitability measures and the negative effects on our statutory capital; • material differences between actual outcomes and the sensitivities calculated under certain scenarios that we may utilize in connection with our risk management strategies; • the impact of interest rates on our future ULSG policyholder obligations and net income volatility; • the potential material adverse effect of changes in accounting standards, practices or policies applicable to us, including changes in the accounting for long-duration contracts; • loss of business and other negative impacts resulting from a downgrade or a potential downgrade in our financial strength or credit ratings; • the availability of reinsurance and the ability of the counterparties to our reinsurance or indemnification arrangements to perform their obligations thereunder; • heightened competition, including with respect to service, product features, product mix, scale, price, actual or perceived financial strength, claims-paying ratings, credit ratings, e-business capabilities and name recognition; • our ability to market and distribute our products through distribution channels and maintain relationships with key distribution partners; • any failure of third parties to provide services we need, any failure of the practices and procedures of such third parties and any inability to obtain information or assistance we need from third parties; • the ability of our subsidiaries to pay dividends to us, and our ability to pay dividends to our shareholders and repurchase our common stock; • the risks associated with climate change; • the adverse impact of public health crises, extreme mortality events or similar occurrences on our business and the economy in general; • the impact of adverse capital and credit market conditions, including with respect to our ability to meet liquidity needs and access capital; 95 Table of Contents • the impact of economic conditions in the capital markets and the U.S. and global economy, as well as geopolitical events, tariffs imposed or threatened by the U.S. or foreign governments, military actions or catastrophic events, on our profitability measures as well as our investment portfolio, including on realized and unrealized losses and impairments, net investment spread and net investment income; • the financial risks that our investment portfolio is subject to, including credit risk, interest rate risk, inflation risk, market valuation risk, liquidity risk, real estate risk, derivatives risk, and other factors outside our control; • the impact of changes in regulation and in supervisory and enforcement policies or interpretations thereof on our insurance business or other operations; • the potential material negative tax impact of potential future tax legislation that could make some of our products less attractive to consumers or increase our tax liability; • the effectiveness of our policies, procedures and processes in managing risk; • the loss or disclosure of confidential information, damage to our reputation and impairment of our ability to conduct business effectively as a result of any failure in cyber- or other information security systems; • whether all or any portion of the tax consequences of our separation from MetLife, Inc. (together with its subsidiaries and affiliates, “MetLife”) are not as expected, leading to material additional taxes or material adverse consequences to tax attributes that impact us; and • other factors described in this report and from time to time in documents that we file with the SEC. For the reasons described above, we caution you against relying on any forward-looking statements, which should also be read in conjunction with the other cautionary statements included and the risks, uncertainties and other factors identified in our 2024 Annual Report, particularly in the sections entitled “Risk Factors” and “Quantitative and Qualitative Disclosures About Market Risk,” as well as in our other subsequent filings with the SEC. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by law. Corporate Information We routinely use our Investor Relations website to provide presentations, press releases, our insurance subsidiaries’ statutory filings, and other information that may be deemed important or material to investors. Accordingly, we encourage investors and others interested in the Company to review the information that we share at http://investor.brighthousefinancial.com. In addition, our Investor Relations website allows interested persons to sign up to automatically receive e-mail alerts when we make filings with the SEC. Information contained on or connected to any website referenced in this report or any of our other filings with the SEC is not incorporated by reference in this report or in any other report or document we file with the SEC, and any website references are intended to be inactive textual references only unless expressly noted.