Brookfield Asset Management : Q4 2020 Supplemental Information

BROOKFIELD ASSET MANAGEMENT INC.

Q4 2020 SupplementalInformation

FOURTH QUARTER AND FULL YEAR, DECEMBER 31, 2020

2020 Full Year Highlights

$602B

$312B

$77B

TOTAL ASSETS UNDER MANAGEMENTFEE-BEARING CAPITAL

DEPLOYABLE CAPITAL

ASSET MANAGEMENT

Fee-bearing capital as at December 31, 2020 was $312 billion, an increase of $22 billion over the year. Growth in fee-bearing capital led to a 19% increase in fee-related earnings during 2020.

• • We raised approximately $40 billion of third-party capital in 2020 across a number of strategies, including our latest distressed debt fund ($12 billion), a growing number of perpetual private fund offerings ($4 billion), and other various credit products ($16 billion), some of which will become fee-earning once invested.

  • - Capital raised and invested across our private fund strategies contributed $24 billion to fee-bearing capital, while growth in capitalization across our listed affiliates contributed an additional $22 billion.

  • - During the year, we returned more than $16 billion of capital to investors.

• • Fee-related earnings showed strong growth in 2020. We recorded $411 million for the fourth quarter and $1.4 billion for the year, with the full year results representing an increase of 19% over the prior year.

• • In total we have approximately $33 billion of additional capital that is committed and will earn annual fees of approximately $330 million once invested.

Annualized fee revenues and target carried interest now stand at a run-rate of $6.5 billion, a 12% increase from the prior year.

• • Annualized fee revenues and annualized fee-related earnings are now $3.3 billion and $1.6 billion, respectively, and gross target carried interest stands at $3.2 billion, or $1.7 billion net of costs, at our share.

We generated $1.2 billion of carried interest during the year, and our accumulated unrealized carried interest now stands at $4.7 billion.

• • Unrealized carried interest during the year was generated by value enhancement initiatives across our operating businesses and valuation uplifts within our credit strategies.

• • Our net unrealized carried interest now stands at $2.6 billion, and we expect approximately 60% to be realized within the next three years.

• • We realized $434 million of carried interest during the quarter ($231 million attributable to Brookfield, net of costs) and $684 million for the year ($348 million attributable to Brookfield, net of costs).

• • Transaction activity has meaningfully increased since the first half of 2020 and we expect the pace of asset sales to pick up in the early part of 2021, which will lead to further carried interest realizations.

Investment activity has remained strong, and we anticipate a strong fundraising year in 2021.

• • The latest vintage of flagship funds are now approximately 65% invested and/or committed, in aggregate, and, following the launch of our latest distressed debt flagship fund in 2020, we are now fundraising our fourth real estate flagship fund and expect to be launching the next private equity and infrastructure flagship funds later in 2021.

• • We also recently launched the Global Transition Fund this quarter that will focus on high-quality, sustainable investments that accelerate the world's transition to a net-zero carbon economy.

Q4 2020 Supplemental Information

2020 Full Year Highlights cont'd

OPERATING RESULTS

FFO1 was $2.1 billion in the quarter and $5.2 billion over the year, 74% and 24% higher than the comparative periods, respectively.

• • Our operating FFO was $1.1 billion in the quarter, representing an increase of 26% compared to the prior year quarter, driven by growth and strong performance across almost all our businesses.

• • For the full year, our operating FFO increased by 13% to $3.3 billion, as we benefited from growth across the portfolio and stability of earnings in our underlying businesses with many backed by long-dated, contracted cash flows.

• • We continue to opportunistically recycle our capital and realize value in our mature businesses. We recognized $810 million of disposition gains in the quarter and $1.6 billion during the year.

We generated a record $3.1 billion of free cash flow in the year, including $1.1 billion during the quarter.

• • Excluding realized carried interest, cash available for distribution and/or reinvestment ("CAFDR")1 increased by 45% in the quarter and 29% over the year, due to growth in our asset management franchise and increased distributions from our listed affiliates.

Net income was $1.8 billion in the quarter and $707 million over the year.

• • We had very strong results in the current quarter with solid operating performance across our businesses. For the year, net income was positive despite significant non-cash valuation losses recognized on a number of our investments earlier in the year, which should continue to improve as global markets recover.

• • Net income attributable to shareholders was $643 million in the quarter, and a net loss of $134 million for the year. Strong operating performance in our asset management franchise was offset by the aforementioned non-cash valuation losses.

LIQUIDITY

Deployable capital at December 31, 2020 was $77 billion, benefiting from strong private fundraising and capital markets activity throughout the year.

• • As at December 31, 2020, we had $16 billion of core liquidity which includes $7 billion at BAM, as well as $61 billion of uncalled private fund commitments.

• • Over the year, we enhanced our liquidity by completing $4.7 billion of corporate financings across BAM and our listed affiliates, while furthering liquidity by opportunistically completing $1 billion in secondary offerings for BEP, BEPC and BIPC units and shares.

Our balance sheet continues to be extremely conservatively capitalized, with a corporate debt to market capitalization ratio of 12% at year end.

• • As of December 31, 2020, our corporate debt totaled $9 billion, with a weighted-average interest rate of 4.4% and a weighted-average remaining term of 14 years.

• • Our corporate debt is supplemented with $4 billion of perpetual preferred shares, which carry an average cost of 3.9%.

1. Refer to the Glossary of Terms starting on page 37.

CONTENTS

Highlights and Overview	2	Reconciliation of IFRS to non-IFRS Measures	32
Detailed Analysis	Common Share Information	33
Asset Management Operating Results	14	Glossary of Terms	37
Invested Capital - Overview	25
Q4 2020 Supplemental Information

Brookfield Asset Management Inc. 3

Performance Highlights
Fee-Bearing Capital	Fee-Related Earnings1
AS AT DEC. 31 (BILLIONS)	FOR THE YEAR ENDED DEC. 31 (MILLIONS)	$1,428
$1,201
2020

2016

$312

2017

2018

■ Long-term private funds ■ Public securities

2019

2020

■ Perpetual strategies ■ Credit strategies

Carry Eligible Capital

AS AT DEC. 31 (BILLIONS)

Accumulated Unrealized Carried Interest

AS AT DEC. 31 (MILLIONS)

$140

$4,024

2016

2017

2018

2019

2020

2016

2017

2018

2019

2020

■ Brookfield

■ Oaktree

■ Accumulated unrealized carried interest, net ■ Accumulated unrealized carried interest, gross

Cash Available for Distribution and/or Reinvestment1

FOR THE YEAR ENDED DEC. 31 (MILLIONS) $3,103 $2,602 $2,859 $1,994 $2,358 $2,041 $2,216 $1,892 $1,845 $1,825 2016 2017 2018 2019 2020 ■ Excluding realized carried interest, net; and performance fees
2016 ludin lized des s sse	2017 zed d int ividen gem	2018 inter net, c.	2019 et; an rform	2020 orma ees

Distributions to Common Shareholders1

FOR THE YEAR ENDED DEC. 31 (MILLIONS)

$726