American Equity Investment Life : 1Q21 Financial Supplement

Exhibit 99.2

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement

March 31, 2021

A. Financial Highlights
Condensed Consolidated Balance Sheets	1
Consolidated Statements of Operations	2
Quarterly Summary - Most Recent 5 Quarters	3
Non-GAAP Financial Measures

Reconciliation from Net Income Available to Common Stockholders to Non-GAAP	5
Operating Income Available to Common Stockholders and Non-GAAP Operating Income
Available to Common Stockholders, Excluding Notable Items
Summary of Adjustments to Arrive at Non-GAAP Operating Income Available to Common	6
Stockholders
Quarterly Summary - Reconciliation from Net Income (Loss) Available to Common	7
Stockholders to Non-GAAP Operating Income (Loss) Available to Common Stockholders
and Non-GAAP Operating Income Available to Common Stockholders, Excluding
Notable Items
Quarterly Summary - Summary of Adjustments to Arrive at Non-GAAP Operating Income	9
(Loss) Available to Common Stockholders
Capitalization/Book Value per Common Share	10
Spread Results	11
B. Product Summary
Summary of Cost of Money for Deferred Annuities	11
Annuity Account Balance Rollforward	11
Annuity Deposits by Product Type	12
Surrender Charge Protection and Account Values by Product Type	12
Annuity Liability Characteristics	13

1. Investment Summary

	Summary of Invested Assets	16
	Credit Quality of Fixed Maturity Securities	16
	Watch List Securities	16
	Fixed Maturity Securities by Sector	17
	Mortgage Loans on Real Estate	18
D.	Shareholder Information	20
E.	Research Analyst Coverage	21

Table of Contents

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - March 31, 2021

Unaudited (Dollars in thousands)

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

		March 31, 2021		December 31, 2020 (a)
Assets
Investments:
Fixed maturity securities, available for sale, at fair value	$	45,690,341	$	47,538,893
Mortgage loans on real estate		4,290,602			4,165,489
Derivative instruments		1,509,892			1,310,954
Other investments		908,437			590,078
Total investments		52,399,272			53,605,414
Cash and cash equivalents		11,087,125			9,095,522
Coinsurance deposits		4,646,406			4,844,927
Accrued investment income		410,112			398,082
Deferred policy acquisition costs		2,470,851			2,225,199
Deferred sales inducements		1,587,653			1,448,375
Income taxes recoverable		-			862
Other assets		76,247			70,198
Total assets	$	72,677,666	$	71,688,579
Liabilities and Stockholders' Equity
Liabilities:
Policy benefit reserves	$	63,519,546	$	62,352,882
Other policy funds and contract claims		234,468			240,904
Notes payable		495,811			495,668
Subordinated debentures		78,187			78,112
Deferred income taxes		376,895			504,000
Income taxes payable		19,599			-
Other liabilities		2,024,400			1,668,025
Total liabilities		66,748,906			65,339,591
Stockholders' equity:
Preferred stock, Series A		16			16
Preferred stock, Series B		12			12
Common stock		95,483			95,721
Additional paid-in capital		1,687,669			1,681,127
Accumulated other comprehensive income		1,505,260			2,203,557
Retained earnings		2,640,320			2,368,555
Total stockholders' equity		5,928,760			6,348,988
Total liabilities and stockholders' equity	$	72,677,666	$	71,688,579

1. The December 31, 2020 balance sheet includes reclassifications from previously reported amounts for the correction of an immaterial error in the calculation of the impact of unrealized gains and losses on lifetime income benefit reserves which was determined in the first quarter of 2021. This is reflected in deferred policy acquisition costs, deferred sales inducements, policy benefit reserves, deferred income taxes and accumulated other comprehensive income

Page 1

Table of Contents

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - March 31, 2021

Unaudited (Dollars in thousands, except per share data)

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended

		March 31,
	2021				2020
Revenues:
Premiums and other considerations	$	13,213	$	7,664
Annuity product charges		60,082			59,549
Net investment income		497,190			573,318
Change in fair value of derivatives		396,305			(941,874)
Net realized losses on investments		(4,583)			(20,336)
Loss on extinguishment of debt		-			(2,024)
Total revenues		962,207			(323,703)
Benefits and expenses:
Insurance policy benefits and change in future policy benefits		16,424			10,072
Interest sensitive and index product benefits		476,595			400,219
Amortization of deferred sales inducements		122,975			73,591
Change in fair value of embedded derivatives		(282,413)			(1,250,061)
Interest expense on notes payable		6,393			6,385
Interest expense on subordinated debentures		1,326			1,588
Amortization of deferred policy acquisition costs		203,823			120,702
Other operating costs and expenses		55,865			43,626
Total benefits and expenses		600,988			(593,878)
Income before income taxes		361,219			270,175
Income tax expense		78,535			27,228
Net income		282,684			242,947
Less: Preferred stock dividends		10,919			6,611
Net income available to common stockholders	$	271,765	$	236,336
Earnings per common share	$	2.84	$	2.58
Earnings per common share - assuming dilution	$	2.82	$	2.57
Weighted average common shares outstanding (in thousands):
Earnings per common share		95,735			91,644
Earnings per common share - assuming dilution		96,216			92,021

Page 2

Table of Contents

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - March 31, 2021

Unaudited (Dollars in thousands, except per share data)

Quarterly Summary - Most Recent 5 Quarters

		Q1 2021			Q4 2020			Q3 2020			Q2 2020			Q1 2020
Revenues:
Traditional life insurance premiums	$	706	$	701	$	708	$	722	$	823
Life contingent immediate annuity considerations		12,507			9,578			9,699			10,310			6,841
Surrender charges		19,481			17,009			16,447			19,390			19,705
Lifetime income benefit rider fees		40,601			48,954			45,830			44,048			39,844
Net investment income		497,190			521,725			543,331			543,704			573,318
Change in fair value of derivatives		396,305			443,867			205,011			327,662			(941,874)
Net realized losses on investments		(4,583)			(12,135)			(22,321)			(25,888)			(20,336)
Loss on extinguishment of debt		-			-			-			-			(2,024)
Total revenues		962,207			1,029,699			798,705			919,948			(323,703)
Benefits and expenses:
Traditional life insurance policy benefits and change in future policy		1,049			1,091			655			702			621
benefits
Life contingent immediate annuity benefits and change in future policy		15,375			11,975			12,618			12,629			9,451
benefits
Interest sensitive and index product benefits (a)		476,595			325,912			576,147			240,992			400,219
Amortization of deferred sales inducements (b)(d)		122,975			22,768			416,983			(75,178)			73,591
Change in fair value of embedded derivatives (c)(d)		(282,413)			568,836			(1,732,497)			1,126,935			(1,250,061)
Interest expense on notes payable		6,393			6,391			6,388			6,388			6,385
Interest expense on subordinated debentures		1,326			1,325			1,323			1,321			1,588
Amortization of deferred policy acquisition costs (b)(d)		203,823			26,145			622,596			(119,889)			120,702
Other operating costs and expenses		55,865			55,321			42,738			41,951			43,626
Total benefits and expenses		600,988			1,019,764			(53,049)			1,235,851			(593,878)
Income (loss) before income taxes		361,219			9,935			851,754			(315,903)			270,175
Income tax expense (benefit) (e)		78,535			1,193			184,554			(68,474)			27,228
Net income (loss) (a)(b)(c)(d)(e)		282,684			8,742			667,200			(247,429)			242,947
Less: Preferred stock dividends		10,919			15,004			5,950			5,950			6,611
Net income (loss) available to common stockholders (a)(b)(c)(d)(e)	$	271,765	$	(6,262)	$	661,250	$	(253,379)	$	236,336
Earnings (loss) per common share	$	2.84	$	(0.07)	$	7.20	$	(2.76)	$	2.58
Earnings (loss) per common share - assuming dilution (a)(b)(c)(d)(e)	$	2.82	$	(0.07)	$	7.17	$	(2.76)	$	2.57
Weighted average common shares outstanding (thousands):
Earnings (loss) per common share		95,735			92,904			91,861			91,803			91,644
Earnings (loss) per common share - assuming dilution		96,216			93,352			92,163			92,027			92,021

1. Q3 2020 includes expense from the revision of assumptions used in determining reserves held for lifetime income benefit riders. The impact increased interest sensitive and index products by $285.8 million and decreased both net income and net income available to common stockholders by $224.4 million and decreased earnings per common share - assuming dilution by $2.44 per share.
2. Q3 2020 includes expense from the revision of assumptions which increased amortization of deferred sales inducements and deferred policy acquisition costs by $391.4 million and $589.2 million, respectively, and decreased both net income and net income available to common stockholders by $769.8 million and decreased earnings per common share - assuming dilution by $8.35 per share.
3. Q3 2020 includes a benefit from the revision of assumptions used in determining the embedded derivative component of our fixed index annuity policy benefit reserves. The impact decreased change in fair value of embedded derivatives by $2,111.1 million and increased both net income and net income available to common stockholders by $1,657.2 million and increased earnings per common share - assuming dilution by $17.98 per share.
4. Q2 2020 includes a benefit from the revision of assumptions used in determining the embedded derivative component of our fixed index annuity policy benefit reserves. The impact decreased change in fair value of embedded derivatives by $230.1 million, increased amortization of deferred sales inducements and deferred policy acquisition costs by $36.7 million and $57.6 million, respectively, and decreased both net loss and net loss available to common stockholders by $106.5 million and reduced loss per common share - assuming dilution by $1.16 per share.

Page 3

Table of Contents

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - March 31, 2021

Unaudited (Dollars in thousands, except per share data)

1. Q1 2020 includes a tax benefit related to the provision of the Coronavirus Aid, Relief, and Economic Security Act, ("CARES Act") which was signed into legislation on March 27, 2020 and allows net operating losses for 2018 through 2020 to be carried back to previous tax years in which a 35% statutory tax rate was in effect. The impact reduced income tax expense and increased both net income and net income available to common stockholders by $30.8 million and increased earnings per common share - assuming dilution by $0.33 per share.

Page 4