8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 17, 2021

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

(Exact name of registrant as specified in its charter)

Iowa	001-31911	42-1447959
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

6000 Westown Parkway

West Des Moines, IA 50266

(Address of principal executive offices and zip code)

(515) 221-0002

(Registrant's telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $1	AEL	New York Stock Exchange
Depositary Shares, each representing a 1/1,000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock, Series A	AELPRA	New York Stock Exchange
Depositary Shares, each representing a 1/1,000th interest in a share of 6.625% Fixed-Rate Reset Non-Cumulative Preferred Stock, Series B	AELPRB	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02  Results of Operations and Financial Condition

On February 17, 2021, the registrant issued a press release announcing its financial results for the fourth quarter and year ended December 31, 2020, a copy of which is attached as Exhibit 99.1 and is incorporated herein by reference. The registrant's financial supplement for the fourth quarter and year ended December 31, 2020, is attached as Exhibit 99.2 and is incorporated herein by reference.

The information, including exhibits attached hereto, furnished under this Item 2.02 shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, except as otherwise expressly stated in such filing.

Item 9.01.  Financial Statements and Exhibits

(d)    Exhibits

The following exhibits are being furnished with this Form 8-K.

Exhibit Number	Description
99.1	Press release dated February 17, 2021, announcing American Equity Investment Life Holding Company's financial results for the fourth quarter and year ended December 31, 2020.
99.2	American Equity Investment Life Holding Company's Financial Supplement for the fourth quarter and year ended December 31, 2020.
104	The cover page from this Current Report on Form 8-K, formatted in Inline XBRL.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: February 17, 2021

AMERICAN EQUITY
INVESTMENT LIFE HOLDING COMPANY
By:	/s/ Anant Bhalla
	Anant Bhalla
	Chief Executive Officer and President

EX-99.1

Exhibit 99.1

	For more information, contact:
	Steven D. Schwartz, Vice President-Investor Relations
	(515) 273-3763, sschwartz@american-equity.com
FOR IMMEDIATE RELEASE
February 17, 2021

American Equity Reports Fourth Quarter and Full Year 2020 Results

Company Highlights

•Fourth quarter 2020 net loss available to common stockholders of $6.3 million or $(0.07) per diluted common share; Full year 2020 net income available to common stockholders of $637.9 million or $6.90 per diluted common share

•Fourth quarter 2020 non-GAAP operating income1 available to common stockholders of $71.7 million or $0.77 per diluted common share; Full year 2020 non-GAAP operating income1 available to common stockholders of $69.1 million or $0.75 per diluted common share

•Excluding notable items, full year 2020 net loss available to common stockholders of $160.2 million or $(1.74) per share; Full year 2020 non-GAAP operating income1 available to common stockholders of $381.4 million or $4.13 per diluted common share, excluding notable items

•Notable items affecting full year 2020 net income and non-GAAP operating income1 available to common stockholders include the effect of actuarial assumption revisions, a tax benefit from enactment of the CARES Act, and loss on extinguishment of debt

•Book value per share excluding accumulated other comprehensive income with and without net impact of accounting for fair value of derivatives and embedded derivatives of $35.99 and $34.26, respectively

•Fourth quarter 2020 annuity sales of $1.8 billion

•Policyholder funds under management of $54.1 billion

•Fourth quarter 2020 investment spread of 2.25%

•Risk-based capital ratio at December 31, 2020 of 372% excluding over $300 million of excess cash at the holding company

WEST DES MOINES, Iowa (February 17, 2021) - American Equity Investment Life Holding Company (NYSE: AEL), a leading issuer of fixed index annuities (FIAs) today reported fourth quarter 2020 net loss available to common stockholders of $6.3 million, or $(0.07) per diluted common share, compared to net income available to common stockholders of $220.2 million, or $2.40 per diluted common share, for fourth quarter 2019. For the year ended December 31, 2020, net income available to common stockholders was $637.9 million, or $6.90 per diluted common share, compared to $246.1 million, or $2.68 per diluted common share, for the year ended December 31, 2019.

Non-GAAP operating income1 available to common stockholders for the fourth quarter 2020 was $71.7 million, or $0.77 per diluted common share, compared to non-GAAP operating income1 available to common stockholders of $125.8 million, or $1.37 per diluted common share, for fourth quarter 2019. For the year ended December 31, 2020, non-GAAP operating income1 was $69.1 million, or $0.75 per diluted common share, compared to $548.2 million, or $5.97 per diluted common share, for the year ended December 31, 2019. For full year 2020, non-GAAP operating return1 on average common stockholders' equity excluding average AOCI1 was 2.3% based on reported results and 11.9% excluding the impact of notable items.

The year-over-year decreases in quarterly non-GAAP operating income1 available to common stockholders and non-GAAP operating income1 per share available to common stockholders were primarily attributable to lower investment spread income, an increase in other operating costs and expenses, and a greater increase in the liability for future policy benefits to be paid for lifetime income benefit riders, partially offset by a decline in deferred acquisition cost and deferred sales inducement amortization. Actual versus modeled actuarial and policyholder experience in the quarter had two offsetting impacts on results, positively affecting amortization of deferred acquisition and sales inducement costs by $16 million but adding to the increase in the liability for future policy benefits to be paid for lifetime income benefit riders by $16 million.

Other operating costs and expenses increased to $55 million from $43 million in the third quarter of 2020 and $39 million in the fourth quarter of 2019 in part reflecting advisory fees related to the unsolicited offer for the company in September.

INVESTMENT SPREAD DECREASES SEQUENTIALLY ON LOWER INVESTMENT YIELD.

American Equity’s investment spread was 2.25% for the fourth quarter of 2020 compared to 2.44% for the third quarter of 2020 and 2.77% for the fourth quarter of 2019. On a sequential basis, the average yield on invested assets decreased by 22 basis points while the cost of money fell by 3 basis points.

Average yield on invested assets was 3.88% in the fourth quarter of 2020 compared to 4.10% in the third quarter of 2020. The decrease in investment yield was primarily driven by retention of a higher level of liquidity in the investment portfolios of the life insurance companies. The average adjusted yield on invested assets excluding non-trendable items was 3.77% in the fourth quarter of 2020 compared to 4.00% in the third quarter of 2020.

The aggregate cost of money for annuity liabilities of 1.63% in the fourth quarter of 2020 was down 3 basis points from 1.66% in the third quarter of 2020. The cost of money in the fourth quarter was positively affected by 1 basis points from over-hedging of index-linked credits compared to 3 basis point of hedge gain in the third quarter.

Commenting on investment spread, Anant Bhalla, Chief Executive Officer, said: "The decrease in average yield on investment assets was attributable to a 22-basis point reduction from interest foregone due to an increase in the amount of cash held in the life insurance company portfolios in the quarter. Cash and short term investments in the quarter averaged $4.4 billion over the fourth quarter compared to $1.7 million in the third quarter."

Bhalla continued: "We accumulated substantial liquidity in the investment portfolio this quarter as we repositioned our invested assets by de-risking out of nearly $2 billion of structured securities and $2.4 billion of corporate securities and built up additional cash in anticipation of the approximately $7 billion needed for redeployment to the Värde-Agam and Brookfield reinsurance transactions. Excluding excess cash, which may be pre-invested prior to transfer, and invested assets to be transferred as part of the reinsurance transactions, the current point-in-time yield on our investment portfolio is approximately 4%."

POLICYHOLDER FUNDS UNDER MANAGEMENT INCREASE 2.0% ON $1.8 BILLION OF SALES

Policyholder funds under management at December 31, 2020 were $54.1 billion, a $1.1 billion, or 2.0% increase from September 30, 2020. Fourth quarter gross and net sales were $1,845 million and $1,839 million, respectively, representing increases of 100% and 118% from fourth quarter 2019 sales. On a sequential basis, gross and net sales increased 221% and 224%, respectively. Compared to the third quarter of 2020, gross sales atAmerican Equity Life increased 103% while Eagle Life sales rose 630%.

Commenting on sales, Bhalla stated: "In the fourth quarter, we reintroduced ourselves to our markets. Driven by the introduction of competitive three- and five-year single premium deferred annuity products at both American Equity Life and Eagle Life, we saw a substantial increase in sales with total deposits of $1.8 billion, doubling from the prior year quarter and up 221% from the third quarter of 2020. Although fixed rate annuities were the major driver of the fourth quarter sales increase, fixed index annuity sales were up 23% sequentially."

PROGRESS ON IMPLEMENTATION OF AEL 2.0    

Speaking about the AEL 2.0 strategy, Bhalla stated: "During the quarter, AEL continued to make strong progress on the implementation of the AEL 2.0 strategy. The fourth quarter of 2020 was the start of our turnaround in the Go-to-Market pillar. We used the fourth quarter to tell distribution we were back and committed to offering competitive products. Along with the successful introduction of our multi-year fixed-rate annuity lineup, we are refreshing our AssetShield accumulation product and will soon launch a compelling, single accumulation annuity product that covers both traditional equity indices and multi-asset custom indices focused on U.S. risk parity, global risk-controlled asset allocation and sector specific allocations. Our lifetime guaranteed income products are very competitive in both the independent agent and financial institutions markets. Sales momentum has continued into the first quarter of this year."

Bhalla went on to add: "While we are not done in Go-to-Market, our focus for much of the remainder of 2021 will be on the Investment Management and Capital Structure pillars of AEL 2.0. In the Investment Management pillar, we intend to focus on our allocation to alpha-generating assets. In the fourth quarter, we closed on our investment in Pretium, a leading asset manager in the residential mortgage loan space. Earlier today, we announced a strategic partnership with Adams Street Credit Advisors to form a new management company to sponsor and manage investment vehicles that will invest in secured loans to U.S. middle market private companies backed by private equity sponsors. In the Capital Structure pillar, we are working diligently to complete the previously announced reinsurance transactions with Värde-Agam and Brookfield Asset Management and the build out of our own offshore reinsurer."

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Forward-looking statements relate to future operations, strategies, financial results or other developments, and are subject to assumptions, risks and uncertainties. Statements such as “guidance”, “expect”, “anticipate”, “believe”, “goal”, “objective”, “target”, “may”, “should”, “estimate”, “projects” or similar words as well as specific projections of future results qualify as forward-looking statements. Factors that may cause our actual results to differ materially from those contemplated by these forward looking statements can be found in the company’s Form 10-K filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date the statement was made and the company undertakes no obligation to update such forward-looking

statements. There can be no assurance that other factors not currently anticipated by the company will not materially and adversely affect our results of operations. Investors are cautioned not to place undue reliance on any forward-looking statements made by us or on our behalf.

CONFERENCE CALL

American Equity will hold a conference call to discuss fourth quarter 2020 earnings on Thursday, February 18, at 8:00 a.m. CT. The conference call will be webcast live on the Internet. Investors and interested parties who wish to listen to the call on the internet may do so at www.american-equity.com.

The call may also be accessed by telephone at 855-865-0606, passcode 9577007 (international callers, please dial 704-859-4382). An audio replay will be available shortly after the call on American Equity's website. An audio replay will also be available via telephone through February 25, 2021 at 855-859-2056, passcode 9577007 (international callers will need to dial 404-537-3406).

ABOUT AMERICAN EQUITY    

American Equity Investment Life Holding Company, through its wholly-owned subsidiaries, is a leading issuer of fixed index annuities through independent agents, banks and broker-dealers. American Equity Investment Life Holding Company, a New York Stock Exchange listed company (NYSE: AEL), is headquartered in West Des Moines, Iowa. For more information, please visit www.american-equity.com.

1    Use of non-GAAP financial measures is discussed in this release in the tables that follow the text of the release.

###

American Equity Investment Life Holding Company

Unaudited (Dollars in thousands, except per share data)

Consolidated Statements of Operations

	Three Months Ended   December 31,				Year Ended   December 31,
	2020		2019		2020		2019
Revenues:
Premiums and other considerations	$	10,279	$	8,846	$	39,382	$	23,534
Annuity product charges	65,963		62,722		251,227		240,035
Net investment income	521,725		588,217		2,182,078		2,307,635
Change in fair value of derivatives	443,867		466,434		34,666		906,906
Net realized gains (losses) on investments	(12,135)		7,029		(80,680)		6,962
Other than temporary impairment (OTTI) losses on investments:
Total OTTI losses	—		(17,412)		—		(18,511)
Portion of OTTI losses recognized from other comprehensive income	—		—		—		(215)
Net OTTI losses recognized in operations	—		(17,412)		—		(18,726)
Loss on extinguishment of debt	—		(2,001)		(2,024)		(2,001)
Total revenues	1,029,699		1,113,835		2,424,649		3,464,345
Benefits and expenses:
Insurance policy benefits and change in future policy benefits	13,066		11,553		49,742		35,418
Interest sensitive and index product benefits	325,912		399,514		1,543,270		1,287,576
Amortization of deferred sales inducements	22,768		91,260		438,164		88,585
Change in fair value of embedded derivatives	568,836		147,879		(1,286,787)		1,454,042
Interest expense on notes payable	6,391		6,384		25,552		25,525
Interest expense on subordinated debentures	1,325		3,651		5,557		15,764
Amortization of deferred policy acquisition costs	26,145		133,573		649,554		87,717
Other operating costs and expenses	55,321		39,194		183,636		154,153
Total benefits and expenses	1,019,764		833,008		1,608,688		3,148,780
Income before income taxes	9,935		280,827		815,961		315,565
Income tax expense	1,193		60,677		144,501		69,475
Net income	8,742		220,150		671,460		246,090
Less: Preferred stock dividends	15,004		—		33,515		—
Net income (loss) available to common stockholders	$	(6,262)	$	220,150	$	637,945	$	246,090
Earnings (loss) per common share	$	(0.07)	$	2.41	$	6.93	$	2.70
Earnings (loss) per common share - assuming dilution	$	(0.07)	$	2.40	$	6.90	$	2.68
Weighted average common shares outstanding (in thousands):
Earnings (loss) per common share	92,904		91,314		92,055		91,139
Earnings (loss) per common share - assuming dilution	93,352		91,883		92,392		91,782

Page 1

American Equity Investment Life Holding Company

Unaudited (Dollars in thousands, except per share data)

NON-GAAP FINANCIAL MEASURES

In addition to net income (loss) available to common stockholders, we have consistently utilized non-GAAP operating income available to common stockholders and non-GAAP operating income available to common stockholders per common share - assuming dilution, non-GAAP financial measures commonly used in the life insurance industry, as economic measures to evaluate our financial performance. Non-GAAP operating income available to common stockholders equals net income (loss) available to common stockholders adjusted to eliminate the impact of items that fluctuate from quarter to quarter in a manner unrelated to core operations, and we believe measures excluding their impact are useful in analyzing operating trends. The most significant adjustments to arrive at non-GAAP operating income available to common stockholders eliminate the impact of fair value accounting for our fixed index annuity business. These adjustments are not economic in nature but rather impact the timing of reported results. We believe the combined presentation and evaluation of non-GAAP operating income available to common stockholders together with net income (loss) available to common stockholders provides information that may enhance an investor’s understanding of our underlying results and profitability.

Reconciliation from Net Income (Loss) Available to Common Stockholders to Non-GAAP Operating Income Available to Common Stockholders

	Three Months Ended   December 31,				Year Ended   December 31,
	2020		2019		2020		2019
Net income (loss) available to common stockholders	$	(6,262)	$	220,150	$	637,945	$	246,090
Adjustments to arrive at non-GAAP operating income available to common stockholders: (a)
Net realized gains/losses on financial assets, including credit losses	9,369		7,606		59,355		7,361
Change in fair value of derivatives and embedded derivatives - fixed index annuities	90,616		(127,777)		(783,157)		373,221
Change in fair value of derivatives - interest rate caps and swap	—		(167)		(848)		1,247
Income taxes	(21,996)		26,023		155,808		(79,736)
Non-GAAP operating income available to common stockholders	$	71,727	$	125,835	$	69,103	$	548,183
Per common share - assuming dilution:
Net income (loss) available to common stockholders	$	(0.07)	$	2.40	$	6.90	$	2.68
Adjustments to arrive at non-GAAP operating income available to common stockholders:
Net realized gains/losses on financial assets, including credit losses	0.10		0.08		0.64		0.08
Change in fair value of derivatives and embedded derivatives - fixed index annuities	0.97		(1.39)		(8.47)		4.07
Change in fair value of derivatives - interest rate caps and swap	—		—		(0.01)		0.01
Income taxes	(0.23)		0.28		1.69		(0.87)
Non-GAAP operating income available to common stockholders	$	0.77	$	1.37	$	0.75	$	5.97

(a)Adjustments to net income (loss) available to common stockholders to arrive at non-GAAP operating income available to common stockholders are presented net of related adjustments to amortization of deferred sales inducements and deferred policy acquisition costs where applicable.

Page 2

American Equity Investment Life Holding Company

Unaudited (Dollars in thousands)

NON-GAAP FINANCIAL MEASURES

Average Common Stockholders' Equity and Return on Average Common Stockholders' Equity

Return on average common stockholders' equity measures how efficiently we generate profits from the resources provided by our net assets.  Return on average common stockholders' equity and non-GAAP operating return on average common stockholders' equity are calculated by dividing net income available to common stockholders and non-GAAP operating income available to common stockholders, respectively, for the trailing twelve months by average total stockholders' equity excluding average equity available to preferred stockholders and average accumulated other comprehensive income (AOCI).  We exclude AOCI because AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale investments.

	Twelve Months Ended
	December 31, 2020
Average Common Stockholders' Equity Excluding Average AOCI
Average total stockholders' equity	$	5,572,418
Average equity available to preferred stockholders	(550,000)
Average AOCI	(1,963,603)
Average common stockholders' equity excluding average AOCI	$	3,058,815
Net income available to common stockholders	$	637,945
Non-GAAP operating income available to common stockholders	$	69,103
Return on Average Common Stockholders' Equity Excluding Average AOCI
Net income available to common stockholders	20.86		%
Non-GAAP operating income available to common stockholders	2.26		%

Page 3

EX-99.2

Exhibit 99.2

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement

December 31, 2020

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 (Loss) Available to Common Stockholders to Non-GAAP Operating Income Available to Common Stockholders	5
	Summary of Adjustments to Arrive at Non-GAAP Operating Income Available to Common Stockholders	6
	Quarterly Summary - Reconciliation from Net Income (Loss) Available to Common Stockholders to Non-GAAP Operating Income (Loss) Available to Common Stockholders	7
	Quarterly Summary - Summary of Adjustments to Arrive at Non-GAAP Operating Income (Loss) Available to Common Stockholders	8
	Capitalization/Book Value per Common Share	9
	Spread Results	10
B.	Product Summary
	Summary of Cost of Money for Deferred Annuities	10
	Annuity Account Balance Rollforward	10
	Annuity Deposits by Product Type	11
	Surrender Charge Protection and Account Values by Product Type	11
	Annuity Liability Characteristics	12
C.	Investment Summary
	Summary of Invested Assets	15
	Credit Quality of Fixed Maturity Securities	15
	Watch List Securities	15
	Fixed Maturity Securities by Sector	16
	Mortgage Loans on Real Estate	17
D.	Shareholder Information	19
E.	Research Analyst Coverage	20

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands)

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

	December 31, 2020		December 31, 2019
Assets
Investments:
Fixed maturity securities, available for sale, at fair value	$	47,538,893	$	51,580,490
Mortgage loans on real estate	4,165,489		3,448,793
Derivative instruments	1,310,954		1,355,989
Other investments	590,078		492,301
Total investments	53,605,414		56,877,573
Cash and cash equivalents	9,095,522		2,293,392
Coinsurance deposits	4,844,927		5,115,013
Accrued investment income	398,082		472,826
Deferred policy acquisition costs	2,045,812		2,923,454
Deferred sales inducements	1,328,857		1,966,723
Income taxes recoverable	862		—
Other assets	70,198		47,571
Total assets	$	71,389,674	$	69,696,552
Liabilities and Stockholders' Equity
Liabilities:
Policy benefit reserves	$	61,768,246	$	61,893,945
Other policy funds and contract claims	240,904		256,105
Notes payable	495,668		495,116
Subordinated debentures	78,112		157,265
Deferred income taxes	564,003		177,897
Income taxes payable	—		429
Other liabilities	1,668,025		2,145,676
Total liabilities	64,814,958		65,126,433
Stockholders' equity:
Preferred stock, Series A	16		16
Preferred stock, Series B	12		—
Common stock	95,721		91,107
Additional paid-in capital	1,681,127		1,212,311
Accumulated other comprehensive income	2,429,285		1,497,921
Retained earnings	2,368,555		1,768,764
Total stockholders' equity	6,574,716		4,570,119
Total liabilities and stockholders' equity	$	71,389,674	$	69,696,552

Page 1

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands, except per share data)

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS

	Three Months Ended   December 31,				Year Ended   December 31,
	2020		2019		2020		2019
Revenues:
Premiums and other considerations	$	10,279	$	8,846	$	39,382	$	23,534
Annuity product charges	65,963		62,722		251,227		240,035
Net investment income	521,725		588,217		2,182,078		2,307,635
Change in fair value of derivatives	443,867		466,434		34,666		906,906
Net realized gains (losses) on investments	(12,135)		7,029		(80,680)		6,962
Other than temporary impairment (OTTI) losses on investments:
Total OTTI losses	—		(17,412)		—		(18,511)
Portion of OTTI losses recognized from other comprehensive income	—		—		—		(215)
Net OTTI losses recognized in operations	—		(17,412)		—		(18,726)
Loss on extinguishment of debt	—		(2,001)		(2,024)		(2,001)
Total revenues	1,029,699		1,113,835		2,424,649		3,464,345
Benefits and expenses:
Insurance policy benefits and change in future policy benefits	13,066		11,553		49,742		35,418
Interest sensitive and index product benefits	325,912		399,514		1,543,270		1,287,576
Amortization of deferred sales inducements	22,768		91,260		438,164		88,585
Change in fair value of embedded derivatives	568,836		147,879		(1,286,787)		1,454,042
Interest expense on notes payable	6,391		6,384		25,552		25,525
Interest expense on subordinated debentures	1,325		3,651		5,557		15,764
Amortization of deferred policy acquisition costs	26,145		133,573		649,554		87,717
Other operating costs and expenses	55,321		39,194		183,636		154,153
Total benefits and expenses	1,019,764		833,008		1,608,688		3,148,780
Income before income taxes	9,935		280,827		815,961		315,565
Income tax expense	1,193		60,677		144,501		69,475
Net income	8,742		220,150		671,460		246,090
Less: Preferred stock dividends	15,004		—		33,515		—
Net income (loss) available to common stockholders	$	(6,262)	$	220,150	$	637,945	$	246,090
Earnings (loss) per common share	$	(0.07)	$	2.41	$	6.93	$	2.70
Earnings (loss) per common share - assuming dilution	$	(0.07)	$	2.40	$	6.90	$	2.68
Weighted average common shares outstanding (in thousands):
Earnings (loss) per common share	92,904		91,314		92,055		91,139
Earnings (loss) per common share - assuming dilution	93,352		91,883		92,392		91,782

Page 2

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands, except per share data)

Quarterly Summary - Most Recent 5 Quarters

	Q4 2020		Q3 2020		Q2 2020		Q1 2020		Q4 2019
Revenues:
Traditional life insurance premiums	$	701	$	708	$	722	$	823	$	762
Life contingent immediate annuity considerations	9,578		9,699		10,310		6,841		8,084
Surrender charges	17,009		16,447		19,390		19,705		15,092
Lifetime income benefit rider fees	48,954		45,830		44,048		39,844		47,630
Net investment income	521,725		543,331		543,704		573,318		588,217
Change in fair value of derivatives	443,867		205,011		327,662		(941,874)		466,434
Net realized gains (losses) on investments	(12,135)		(22,321)		(25,888)		(20,336)		7,029
Net OTTI losses recognized in operations	—		—		—		—		(17,412)
Loss on extinguishment of debt	—		—		—		(2,024)		(2,001)
Total revenues	1,029,699		798,705		919,948		(323,703)		1,113,835
Benefits and expenses:
Traditional life insurance policy benefits and change in future policy benefits	1,091		655		702		621		835
Life contingent immediate annuity benefits and change in future policy benefits	11,975		12,618		12,629		9,451		10,718
Interest sensitive and index product benefits (a)	325,912		576,147		240,992		400,219		399,514
Amortization of deferred sales inducements (b)(d)	22,768		416,983		(75,178)		73,591		91,260
Change in fair value of embedded derivatives (c)(d)	568,836		(1,732,497)		1,126,935		(1,250,061)		147,879
Interest expense on notes payable	6,391		6,388		6,388		6,385		6,384
Interest expense on subordinated debentures	1,325		1,323		1,321		1,588		3,651
Amortization of deferred policy acquisition costs (b)(d)	26,145		622,596		(119,889)		120,702		133,573
Other operating costs and expenses	55,321		42,738		41,951		43,626		39,194
Total benefits and expenses	1,019,764		(53,049)		1,235,851		(593,878)		833,008
Income (loss) before income taxes	9,935		851,754		(315,903)		270,175		280,827
Income tax expense (benefit) (e)	1,193		184,554		(68,474)		27,228		60,677
Net income (loss) (a)(b)(c)(d)(e)	8,742		667,200		(247,429)		242,947		220,150
Less: Preferred stock dividends	15,004		5,950		5,950		6,611		—
Net income (loss) available to common stockholders (a)(b)(c)(d)(e)	$	(6,262)	$	661,250	$	(253,379)	$	236,336	$	220,150
Earnings (loss) per common share	$	(0.07)	$	7.20	$	(2.76)	$	2.58	$	2.41
Earnings (loss) per common share - assuming dilution (a)(b)(c)(d)(e)	$	(0.07)	$	7.17	$	(2.76)	$	2.57	$	2.40
Weighted average common shares outstanding (thousands):
Earnings (loss) per common share	92,904		91,861		91,803		91,644		91,314
Earnings (loss) per common share - assuming dilution	93,352		92,163		92,027		92,021		91,883

(a)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.

(b)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.

(c)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.

(d)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

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands, except per share data)

(e)Q1 2020 includes a tax benefit related to the provision of the Coronavirus Aid, Relief, and Economic Security Act, (“the 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

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands, except per share data)

NON-GAAP FINANCIAL MEASURES

In addition to net income (loss) available to common stockholders, we have consistently utilized non-GAAP operating income available to common stockholders and non-GAAP operating income available to common stockholders per common share - assuming dilution, non-GAAP financial measures commonly used in the life insurance industry, as economic measures to evaluate our financial performance. Non-GAAP operating income available to common stockholders equals net income (loss) available to common stockholders adjusted to eliminate the impact of items that fluctuate from quarter to quarter in a manner unrelated to core operations, and we believe measures excluding their impact are useful in analyzing operating trends. The most significant adjustments to arrive at non-GAAP operating income available to common stockholders eliminate the impact of fair value accounting for our fixed index annuity business. These adjustments are not economic in nature but rather impact the timing of reported results. We believe the combined presentation and evaluation of non-GAAP operating income available to common stockholders together with net income (loss) available to common stockholders provides information that may enhance an investor’s understanding of our underlying results and profitability.

Reconciliation from Net Income (Loss) Available to Common Stockholders to Non-GAAP Operating Income Available to Common Stockholders

	Three Months Ended   December 31,				Year Ended   December 31,
	2020		2019		2020		2019
Net income (loss) available to common stockholders	$	(6,262)	$	220,150	$	637,945	$	246,090
Adjustments to arrive at non-GAAP operating income available to common stockholders: (a)
Net realized gains/losses on financial assets, including credit losses	9,369		7,606		59,355		7,361
Change in fair value of derivatives and embedded derivatives - fixed index annuities	90,616		(127,777)		(783,157)		373,221
Change in fair value of derivatives - interest rate caps and swap	—		(167)		(848)		1,247
Income taxes	(21,996)		26,023		155,808		(79,736)
Non-GAAP operating income available to common stockholders	$	71,727	$	125,835	$	69,103	$	548,183
Per common share - assuming dilution:
Net income (loss) available to common stockholders	$	(0.07)	$	2.40	$	6.90	$	2.68
Adjustments to arrive at non-GAAP operating income available to common stockholders:
Net realized gains/losses on financial assets, including credit losses	0.10		0.08		0.64		0.08
Change in fair value of derivatives and embedded derivatives - fixed index annuities	0.97		(1.39)		(8.47)		4.07
Change in fair value of derivatives - interest rate caps and swap	—		—		(0.01)		0.01
Income taxes	(0.23)		0.28		1.69		(0.87)
Non-GAAP operating income available to common stockholders	$	0.77	$	1.37	$	0.75	$	5.97

(a)Adjustments to net income (loss) available to common stockholders to arrive at non-GAAP operating income available to common stockholders are presented net of related adjustments to amortization of deferred sales inducements (DSI) and deferred policy acquisition costs (DAC) where applicable.

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AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands)

NON-GAAP FINANCIAL MEASURES

Summary of Adjustments to Arrive at Non-GAAP Operating Income Available to Common Stockholders

	Three Months Ended   December 31,				Year Ended   December 31,
	2020		2019		2020		2019
Net realized gains/losses on financial assets, including credit losses:
Net realized gains/losses on financial assets, including credit losses	$	11,374	$	10,383	$	79,330	$	11,764
Amortization of DAC and DSI	(2,005)		(2,777)		(19,975)		(4,403)
Income taxes	(2,024)		(1,643)		(12,821)		875
	$	7,345	$	5,963	$	46,534	$	8,236
Change in fair value of derivatives and embedded derivatives:
Fixed index annuities	$	152,386	$	(222,927)	$	(1,279,644)	$	368,650
Interest rate caps and swap	—		(167)		(848)		1,247
Amortization of DAC and DSI	(61,770)		95,150		496,487		4,571
Income taxes	(19,972)		27,666		168,629		(80,611)
	$	70,644	$	(100,278)	$	(615,376)	$	293,857

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AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands, except per share data)

NON-GAAP FINANCIAL MEASURES

Quarterly Summary - Most Recent 5 Quarters

Reconciliation from Net Income (Loss) Available to Common Stockholders to Non-GAAP Operating Income (Loss) Available to Common Stockholders

	Q4 2020		Q3 2020		Q2 2020		Q1 2020		Q4 2019
Net income (loss) available to common stockholders	$	(6,262)	$	661,250	$	(253,379)	$	236,336	$	220,150
Adjustments to arrive at non-GAAP operating income (loss) available to common stockholders: (a)
Net realized gains/losses on financial assets, including credit losses	9,369		15,145		18,492		16,349		7,606
Change in fair value of derivatives and embedded derivatives - fixed index annuities	90,616		(1,176,909)		423,590		(120,454)		(127,777)
Change in fair value of derivatives - interest rate caps and swap	—		—		—		(848)		(167)
Income taxes	(21,996)		250,701		(95,599)		22,702		26,023
Non-GAAP operating income (loss) available to common stockholders (b)(c)(d)	$	71,727	$	(249,813)	$	93,104	$	154,085	$	125,835
Per common share - assuming dilution:
Net income (loss) available to common stockholders	$	(0.07)	$	7.17	$	(2.76)	$	2.57	$	2.40
Adjustments to arrive at non-GAAP operating income (loss) available to common stockholders:
Anti-dilutive effect of net loss	—		—		0.01		—		—
Anti-dilutive effect of operating loss	—		0.01		—		—		—
Net realized gains/losses on financial assets, including credit losses	0.10		0.16		0.20		0.17		0.08
Change in fair value of derivatives and embedded derivatives - fixed index annuities	0.97		(12.77)		4.60		(1.31)		(1.39)
Change in fair value of derivatives - interest rate caps and swap	—		—		—		(0.01)		—
Income taxes	(0.23)		2.71		(1.04)		0.25		0.28
Non-GAAP operating income (loss) available to common stockholders (b)(c)(d)	$	0.77	$	(2.72)	$	1.01	$	1.67	$	1.37

(a)Adjustments to net income (loss) available to common stockholders to arrive at non-GAAP operating income (loss) available to common stockholders are presented net of related adjustments to amortization of deferred sales inducements and deferred policy acquisition costs where applicable.

(b)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 increased non-GAAP operating loss available to common stockholders and non-GAAP operating loss available to common stockholders per common share - assuming dilution by $224.4 million and $2.44 per share, respectively.

(c)Q3 2020 includes expense from the revision of assumptions which increased amortization of deferred sales inducements and deferred policy acquisition costs by $57.5 million and $91.0 million, respectively, and increased non-GAAP operating loss available to common stockholders and non-GAAP operating loss available to common stockholders per common share - assuming dilution by $116.5 million and $1.26 per share, respectively.

(d)Q1 2020 includes a tax benefit related to the provision of the 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 non-GAAP operating income available to common stockholders and non-GAAP operating income available to common stockholders per common share - assuming dilution by $30.8 million and $0.33 per share, respectively.

Page 7

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands)

NON-GAAP FINANCIAL MEASURES

Summary of Adjustments to Arrive at Non-GAAP Operating Income (Loss) Available to Common Stockholders

	Q4 2020		Q3 2020		Q2 2020		Q1 2020		Q4 2019
Net realized (gains) losses on investments	$	12,135	$	22,321	$	25,888	$	20,336	$	(7,029)
Net OTTI losses recognized in operations	—		—		—		—		17,412
Change in fair value of derivatives	(416,450)		(203,088)		(413,489)		1,039,322		(370,973)
Increase (decrease) in total revenues	(404,315)		(180,767)		(387,601)		1,059,658		(360,590)
Amortization of deferred sales inducements	22,785		(303,710)		115,511		(29,683)		(37,374)
Change in fair value of embedded derivatives	(568,836)		1,732,497		(1,126,935)		1,250,061		(147,879)
Interest sensitive and index product benefits (a)	761		1,298		612		(1,321)		—
Amortization of deferred policy acquisition costs	40,990		(449,088)		181,129		(54,446)		(54,999)
Increase (decrease) in total benefits and expenses	(504,300)		980,997		(829,683)		1,164,611		(240,252)
Increase in income (loss) before income taxes	99,985		(1,161,764)		442,082		(104,953)		(120,338)
Increase (decrease) in income tax expense (benefit)	21,996		(250,701)		95,599		(22,702)		(26,023)
Increase (decrease) in net income (loss) available to common stockholders	$	77,989	$	(911,063)	$	346,483	$	(82,251)	$	(94,315)

(a)Interest sensitive and index product benefits adjustment reflects the change in the allowance for credit losses on our reinsurance recoverable/coinsurance deposits under a revised impairment model for financial assets measured at amortized cost which we were required to adopt on January 1, 2020. The change in this allowance is reflected in the net realized gains/losses of financial assets, including credit losses line in the other Non-GAAP financial measures tables in this financial supplement.

Page 8

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands, except share and per share data)

Capitalization/Book Value per Common Share

	Q4 2020			Q3 2020			Q2 2020			Q1 2020			Q4 2019
Capitalization:
Notes payable	$	500,000		$	500,000		$	500,000		$	500,000		$	500,000
Subordinated debentures payable to subsidiary trusts	78,112			78,037			77,964			77,893			159,272
Total debt	578,112			578,037			577,964			577,893			659,272
Total stockholders’ equity	6,574,716			6,118,734			5,062,059			3,522,757			4,570,119
Total capitalization	7,152,828			6,696,771			5,640,023			4,100,650			5,229,391
Accumulated other comprehensive income (AOCI)	(2,429,285)			(2,112,111)			(1,719,839)			(219,974)			(1,497,921)
Total capitalization excluding AOCI (a)	$	4,723,543		$	4,584,660		$	3,920,184		$	3,880,676		$	3,731,470
Total stockholders’ equity	$	6,574,716		$	6,118,734		$	5,062,059		$	3,522,757		$	4,570,119
Equity available to preferred stockholders (b)	(700,000)			(700,000)			(700,000)			(400,000)			(400,000)
Total common stockholders' equity (c)	5,874,716			5,418,734			4,362,059			3,122,757			4,170,119
Accumulated other comprehensive income	(2,429,285)			(2,112,111)			(1,719,839)			(219,974)			(1,497,921)
Total common stockholders’ equity excluding AOCI (c)	3,445,431			3,306,623			2,642,220			2,902,783			2,672,198
Net impact of fair value accounting for derivatives and embedded derivatives	(166,453)			(237,099)			685,839			353,853			448,924
Total common stockholders’ equity excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives (c)	$	3,278,978		$	3,069,524		$	3,328,059		$	3,256,636		$	3,121,122
Common shares outstanding	95,720,622			91,931,837			91,595,066			91,497,841			91,107,555
Book Value per Common Share: (d)
Book value per common share	$	61.37		$	58.94		$	47.62		$	34.13		$	45.77
Book value per common share excluding AOCI (c)	$	35.99		$	35.97		$	28.85		$	31.73		$	29.33
Book value per common share excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives (c)	$	34.26		$	33.39		$	36.33		$	35.59		$	34.26
Debt-to-Capital Ratios: (e)
Senior debt / Total capitalization	10.6		%	10.9		%	12.8		%	12.9		%	13.4		%
Total debt / Total capitalization	12.2		%	12.6		%	14.7		%	14.9		%	17.7		%

(a)Total capitalization excluding AOCI, a non-GAAP financial measure, is based on stockholders' equity excluding the effect of AOCI.

(b)Equity available to preferred stockholders is equal to the redemption value of outstanding preferred stock plus share dividends declared but not yet issued.

(c)Total common stockholders' equity, total common stockholders' equity excluding AOCI and total common stockholders' equity excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives, non-GAAP financial measures, exclude equity available to preferred stockholders. Total common stockholders’ equity and book value per common share excluding AOCI, non-GAAP financial measures, are based on common stockholders’ equity excluding the effect of AOCI. Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale securities, we believe these non-GAAP financial measures provide useful supplemental information. Total common stockholders' equity and book value per common share excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives, non-GAAP financial measures, are based on common stockholders' equity excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives. Since the net impact of fair value accounting for our derivatives and embedded derivatives fluctuates from quarter to quarter and the most significant impacts relate to fair value accounting for our fixed index annuity business and are not economic in nature but rather impact the timing of reported results, we believe these non-GAAP financial measures provide useful supplemental information.

(d)Book value per common share including and excluding AOCI and book value per common share excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives are calculated as total common stockholders’ equity, total common stockholders’ equity excluding AOCI and total common stockholders' equity excluding AOCI and the net impact of fair value accounting for derivatives and embedded derivatives divided by the total number of shares of common stock outstanding.

(e)Debt-to-capital ratios are computed using total capitalization excluding AOCI.

Page 9

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands)

Spread Results

Year Ended   December 31,
2020	2019		Q4 2020	Q3 2020	Q2 2020	Q1 2020	Q4 2019
4.12%	4.52%	Average yield on invested assets	3.88%	4.10%	4.12%	4.36%	4.52%
1.69%	1.84%	Aggregate cost of money	1.63%	1.66%	1.73%	1.72%	1.75%
2.43%	2.68%	Aggregate investment spread	2.25%	2.44%	2.39%	2.64%	2.77%
		Impact of:
0.08%	0.06%	Investment yield - additional prepayment income	0.11%	0.10%	0.03%	0.06%	0.12%
0.02%	0.03%	Cost of money effect of over (under) hedging	0.01%	0.03%	(0.01)%	0.05%	0.05%
$53,096,408	$51,072,498	Weighted average investments	$53,836,378	$53,024,798	$52,901,215	$52,623,239	$52,141,459

Weighted average investments include fixed maturity securities at amortized cost and mortgage loans on real estate and other investments at carrying values as reflected in the consolidated balance sheets. The numerator for average yield on invested assets includes net investment income and the tax effect of investment income that is exempt from income taxes.

Summary of Cost of Money for Deferred Annuities

Year Ended   December 31,
2020		2019			Q4 2020		Q3 2020		Q2 2020		Q1 2020		Q4 2019
				Included in interest sensitive and index product benefits:
$	747,489	$	587,818	Index credits	$	195,927	$	174,747	$	97,875	$	278,940	$	277,798
192,468		196,907		Interest credited	49,551		47,376		46,594		48,947		49,482
				Included in change in fair value of derivatives:
(758,604)		(605,005)		Proceeds received at option expiration	(197,921)		(178,405)		(97,015)		(285,263)		(284,624)
716,857		781,841		Pro rata amortization of option cost	170,505		176,481		182,841		187,030		188,984
$	898,210	$	961,561	Cost of money for deferred annuities	$	218,062	$	220,199	$	230,295	$	229,654	$	231,640
$	53,269,994	$	52,278,357	Weighted average liability balance outstanding	$	53,531,441	$	53,059,376	$	53,214,255	$	53,274,905	$	53,092,419

Annuity Account Balance Rollforward

Year Ended   December 31,
2020		2019			Q4 2020		Q3 2020		Q2 2020		Q1 2020		Q4 2019
$	53,233,898	$	51,053,450	Account balances at beginning of period	$	53,006,150	$	53,112,600	$	53,315,909	$	53,233,898	$	52,950,937
3,613,269		4,661,171		Net deposits	1,830,816		557,675		543,026		681,752		838,761
93,610		177,942		Premium bonuses	25,143		21,205		22,710		24,552		36,983
939,957		784,725		Fixed interest credited and index credits	245,478		222,123		144,469		327,887		327,280
(72,551)		(71,565)		Surrender charges	(17,009)		(16,447)		(19,390)		(19,705)		(15,092)
(178,676)		(168,470)		Lifetime income benefit rider fees	(48,954)		(45,830)		(44,048)		(39,844)		(47,630)
(3,572,782)		(3,203,355)		Surrenders, withdrawals, deaths, etc.	(984,899)		(845,176)		(850,076)		(892,631)		(857,341)
$	54,056,725	$	53,233,898	Account balances at end of period	$	54,056,725	$	53,006,150	$	53,112,600	$	53,315,909	$	53,233,898

Page 10

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands)

Annuity Deposits by Product Type

Year Ended   December 31,
2020		2019			Q4 2020		Q3 2020		Q2 2020		Q1 2020		Q4 2019
				American Equity Life:
$	1,992,059	$	4,058,638	Fixed index annuities	$	500,495	$	432,602	$	472,899	$	586,063	$	765,180
8,128		11,245		Annual reset fixed rate annuities	1,664		1,817		2,316		2,331		1,843
395,982		1,613		Multi-year fixed rate annuities	394,999		531		83		369		306
33,461		12,002		Single premium immediate annuities	7,774		10,205		10,084		5,398		4,873
2,429,630		4,083,498			904,932		445,155		485,382		594,161		772,202
				Eagle Life:
345,519		646,903		Fixed index annuities	106,170		60,476		72,371		106,502		67,784
97		199		Annual reset fixed rate annuities	—		39		17		41		6
907,151		232,613		Multi-year fixed rate annuities	833,765		68,206		1,031		4,149		81,041
1,252,767		879,715			939,935		128,721		73,419		110,692		148,831
				Consolidated:
2,337,578		4,705,541		Fixed index annuities	606,665		493,078		545,270		692,565		832,964
8,225		11,444		Annual reset fixed rate annuities	1,664		1,856		2,333		2,372		1,849
1,303,133		234,226		Multi-year fixed rate annuities	1,228,764		68,737		1,114		4,518		81,347
33,461		12,002		Single premium immediate annuities	7,774		10,205		10,084		5,398		4,873
3,682,397		4,963,213		Total before coinsurance ceded	1,844,867		573,876		558,801		704,853		921,033
35,667		290,040		Coinsurance ceded	6,277		5,996		5,691		17,703		77,399
$	3,646,730	$	4,673,173	Net after coinsurance ceded	$	1,838,590	$	567,880	$	553,110	$	687,150	$	843,634

Surrender Charge Protection and Account Values by Product Type

Annuity Surrender Charges and Net (of Coinsurance) Account Values at December 31, 2020:

	Surrender Charge			Net Account Value
Product Type	Avg. Years At Issue	Avg. Years Remaining	Avg. % Remaining	Dollars in Thousands		%
Fixed Index Annuities	12.8	6.3	10.1%	$	50,805,202	94.0	%
Annual Reset Fixed Rate Annuities	9.2	2.8	5.3%	1,392,825		2.6	%
Multi-Year Fixed Rate Annuities	4.4	2.8	7.6%	1,858,698		3.4	%
Total	12.4	6.1	9.9%	$	54,056,725	100.0	%

Page 11

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands)

Annuity Liability Characteristics

Surrender Charge Percentages:	Fixed Annuities Account Value		Fixed Index Annuities Account Value
No surrender charge	$	821,579	$	3,002,716
0.0% < 2.0%	16,419		262,384
2.0% < 3.0%	37,922		1,951,839
3.0% < 4.0%	87,012		2,409,112
4.0% < 5.0%	46,626		1,931,519
5.0% < 6.0%	267,881		2,978,897
6.0% < 7.0%	37,229		1,993,112
7.0% < 8.0%	79,400		4,564,942
8.0% < 9.0%	63,272		3,637,588
9.0% < 10.0%	1,343,422		3,585,668
10.0% or greater	450,761		24,487,425
	$	3,251,523	$	50,805,202

Surrender Charge Expiration By Year:	Fixed and Fixed Index Annuities Account Value		Weighted Average Surrender Charge
Out of Surrender Charge	$	3,824,295	0.00	%
2021	1,167,342		2.86	%
2022	1,646,140		3.66	%
2023	4,955,486		5.46	%
2024	4,920,382		5.78	%
2025	6,321,794		7.71	%
2026	5,118,551		9.36	%
2027	4,406,156		11.06	%
2028	4,639,590		11.92	%
2029	5,939,907		13.38	%
2030	3,891,867		15.18	%
2031	2,903,255		17.41	%
2032	1,986,854		18.06	%
2033	1,146,341		18.48	%
2034	722,614		18.96	%
2035	316,128		19.50	%
2036	150,023		20.00	%
	$	54,056,725	9.89	%

Page 12

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands)

Annuity Liability Characteristics

Credited Rate vs. Ultimate Minimum Guaranteed Rate Differential:	Fixed Annuities Account Value		Fixed Index Annuities Account Value
No differential	$	951,418	$	1,242,188
› 0.0% - 0.25%	47,881		143,281
› 0.25% - 0.5%	233,363		9,812
› 0.5% - 1.0%	18,125		3,101
› 1.0% - 1.5%	11,319		—
1.00% ultimate guarantee - 2.11% wtd avg interest rate (a)	1,728,028		964,626
1.50% ultimate guarantee - 1.08% wtd avg interest rate (a)	139,686		3,207,602
1.75% ultimate guarantee - 1.71% wtd avg interest rate (a)	49,070		529,851
2.00% ultimate guarantee - 1.85% wtd avg interest rate (a)	72,633		—
2.25% ultimate guarantee - 1.65% wtd avg interest rate (a)	—		697,144
3.00% ultimate guarantee - 1.95% wtd avg interest rate (a)	—		1,395,218
Allocated to index strategies (see tables that follow)	—		42,612,379
	$	3,251,523	$	50,805,202

(a)The minimum guaranteed interest rate for the fixed rate or the fixed rate strategy ranges from 0.5% - 1.75%. The ultimate guaranteed rate is applied on less than 100% of the premium.

If all crediting rates were reduced to minimum guaranteed rates (subject to limitations imposed by ultimate minimum guaranteed rates where applicable) the weighted average crediting rate as of December 31, 2020 for fixed annuities and funds allocated to the fixed rate strategy for fixed index annuities would decrease by 0.11%.

Page 13

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands)

Annuity Liability Characteristics

FIXED INDEX ANNUITIES ACCOUNT VALUE - INDEX STRATEGIES

Annual Monthly Average and Point-to-Point with Caps
	Minimum Guaranteed Cap
	1%		3%		4%		7%		8% +
Current Cap
At minimum	$	1,315	$	103,707	$	5,129,029	$	61,044	$	137,218
1.75% - 3%	8,908,370		—		—		—		—
3% - 4%	302,595		2,276		—		—		—
4% - 5%	1,375,290		210,414		1,051,623		—		—
5% - 6%	587,639		178,878		27,849		—		—
6% - 7%	51		—		444		—		—
>= 7%	10,024		7,089		889		5,042		—

Annual Monthly Average and Point-to-Point with Participation Rates
	Minimum Guaranteed Participation Rate
	10%		20% - 25%		35%		50% +
Current Participation Rate
At minimum	$	139,182	$	399,855	$	84,457	$	93,141
< 20%	1,110,572		—		—		—
20% - 40%	2,581,224		193,097		2,266		—
40% - 60%	2,730,773		67,801		50,850		—
60% - 100%	750,082		—		—		—
> 100%	565,364		—		—		—

S&P 500 Monthly Point-to-Point - Minimum Guaranteed Monthly Cap = 1.0%
Current Cap
At minimum	$	1,996,943
1.10% - 1.30%	6,442,128
1.40% - 1.60%	1,875,157
1.70% - 2.00%	273,379
>= 2.10%	7,930

Volatility Control Index
Current Asset Fee
At Maximum	$	—
0.75% - 1.75%	362,570
2.25% - 2.75%	194,300
3.00% - 3.50%	1,172,780
3.75% - 5.25%	3,341,369

If all caps and participation rates were reduced to minimum caps and participation rates and current asset fees were increased to their maximums, the cost of options would decrease by 0.76% based upon prices of options for the week ended January 1, 2021.

Page 14

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands)

Summary of Invested Assets

	December 31, 2020				December 31, 2019
	Carrying Amount		Percent		Carrying Amount		Percent
Fixed maturity securities:
United States Government full faith and credit	$	39,771	0.1	%	$	161,765	0.3	%
United States Government sponsored agencies	1,039,551		1.9	%	625,020		1.1	%
United States municipalities, states and territories	3,776,131		7.0	%	4,527,671		7.9	%
Foreign government obligations	202,706		0.4	%	205,096		0.3	%
Corporate securities	31,156,827		58.1	%	32,536,839		57.2	%
Residential mortgage backed securities	1,512,831		2.8	%	1,575,664		2.8	%
Commercial mortgage backed securities	4,261,227		8.0	%	5,786,279		10.2	%
Other asset backed securities	5,549,849		10.4	%	6,162,156		10.8	%
Total fixed maturity securities	47,538,893		88.7	%	51,580,490		90.6	%
Mortgage loans on real estate	4,165,489		7.8	%	3,448,793		6.1	%
Derivative instruments	1,310,954		2.4	%	1,355,989		2.4	%
Other investments	590,078		1.1	%	492,301		0.9	%
	$	53,605,414	100.0	%	$	56,877,573	100.0	%

Credit Quality of Fixed Maturity Securities - December 31, 2020

NAIC Designation	Carrying Amount		Percent		Rating Agency Rating	Carrying Amount		Percent
1	$	26,564,542	55.9	%	Aaa/Aa/A	$	27,883,428	58.7	%
2	19,377,013		40.8	%	Baa	18,408,954		38.7	%
3	1,299,455		2.7	%	Ba	973,581		2.0	%
4	256,651		0.5	%	B	122,553		0.3	%
5	16,288		—	%	Caa	61,037		0.1	%
6	24,944		0.1	%	Ca and lower	89,340		0.2	%
	$	47,538,893	100.0	%		$	47,538,893	100.0	%

Watch List Securities - December 31, 2020

General Description (a)	Amortized Cost		Allowance for Credit Losses		Amortized Cost, Net of Allowance		Net Unrealized Gains (Losses), Net of Allowance		Fair Value
Corporate securities - Public securities	$	149,419	$	(48,197)	$	101,222	$	(3,416)	$	97,806
Corporate securities - Private placement securities	336,910		(11,996)		324,914		1,565		326,479
Residential mortgage backed securities	31,127		(1,734)		29,393		(348)		29,045
Commercial mortgage backed securities	78,269		—		78,269		(11,254)		67,015
Other asset backed securities	69,650		—		69,650		(2,826)		66,824
United States municipalities, states and territories	19,427		(2,844)		16,583		(951)		15,632
	$	684,802	$	(64,771)	$	620,031	$	(17,230)	$	602,801

(a)The watch list consists of all fixed maturity securities we have determined contain elevated credit risk, including those we have taken credit losses on.

Page 15

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands)

Fixed Maturity Securities by Sector

	December 31, 2020				December 31, 2019
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Available for sale:
United States Government full faith and credit and sponsored agencies	$	1,032,936	$	1,079,322	$	763,164	$	786,785
United States municipalities, states and territories	3,236,767		3,776,131		4,147,343		4,527,671
Foreign government obligations	177,062		202,706		186,993		205,096
Corporate securities:
Capital goods	2,295,927		2,721,465		2,550,750		2,794,986
Consumer discretionary	5,674,845		6,734,249		6,082,974		6,658,120
Energy	2,140,768		2,359,893		2,499,030		2,677,646
Financials	5,971,097		6,877,472		6,737,325		7,323,150
Government non-guaranteed	539,148		632,178		539,639		606,308
Industrials	276,352		319,823		311,269		336,537
Information technology	1,556,654		1,840,942		1,868,131		2,051,175
Materials	1,543,032		1,803,501		1,818,048		1,961,033
Other	315,628		370,204		439,171		469,344
Telecommunications	1,340,484		1,582,329		1,510,836		1,664,350
Transportation	1,362,858		1,511,499		1,486,540		1,603,997
Utilities	3,728,403		4,403,272		3,978,459		4,390,193
Residential mortgage backed securities:
Government agency	549,677		627,201		591,100		646,787
Prime	771,031		788,933		793,357		815,916
Alt-A	79,248		96,697		93,281		112,961
Commercial mortgage backed securities:
Government agency	398,141		447,726		414,626		437,420
Non-agency	3,721,509		3,813,501		5,176,541		5,348,859
Other asset backed securities:
Auto	258,286		266,065		403,860		411,371
Energy	7,301		8,946		7,495		8,603
Financials	4,441		3,911		4,967		5,493
Industrials	60,894		61,147		167,466		171,273
Collateralized loan obligations	4,255,839		4,112,318		4,787,402		4,612,694
Military housing	464,684		538,356		471,621		539,029
Other	541,724		559,106		407,558		413,693
	$	42,304,736	$	47,538,893	$	48,238,946	$	51,580,490

Page 16

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands)

Mortgage Loans on Real Estate

	December 31, 2020				December 31, 2019
	Principal		Percent		Principal		Percent
Geographic distribution: commercial mortgage loans
East	$	699,741	19.5	%	$	645,991	19.0	%
Middle Atlantic	281,971		7.9	%	284,597		8.4	%
Mountain	391,025		10.9	%	389,892		11.4	%
New England	24,774		0.7	%	9,152		0.3	%
Pacific	659,743		18.4	%	618,336		18.1	%
South Atlantic	832,739		23.3	%	751,199		22.0	%
West North Central	266,050		7.4	%	288,413		8.5	%
West South Central	424,111		11.9	%	420,031		12.3	%
	$	3,580,154	100.0	%	$	3,407,611	100.0	%
Property type distribution: commercial mortgage loans
Office	$	297,065	8.3	%	$	250,287	7.3	%
Medical Office	20,584		0.6	%	29,990		0.9	%
Retail	1,187,484		33.2	%	1,225,670		36.0	%
Industrial/Warehouse	929,325		25.9	%	896,558		26.3	%
Apartment	939,084		26.2	%	858,679		25.2	%
Mixed use/Other	206,612		5.8	%	146,427		4.3	%
	$	3,580,154	100.0	%	$	3,407,611	100.0	%

Page 17

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Unaudited (Dollars in thousands)

	December 31, 2020
	Commercial		Agricultural		Residential		Total
Credit exposure - by payment activity
Performing	$	3,580,154	$	245,807	$	366,047	$	4,192,008
In workout	—		—		—		—
Delinquent	—		—		273		273
Collateral dependent	—		—		—		—
Principal outstanding	3,580,154		245,807		366,320		4,192,281
Unamortized discounts and premiums, net	—		—		5,212		5,212
Deferred fees and costs, net	(1,266)		(634)		925		(975)
Amortized cost	3,578,888		245,173		372,457		4,196,518
Valuation allowance	(25,529)		(2,130)		(3,370)		(31,029)
Carrying value	$	3,553,359	$	243,043	$	369,087	$	4,165,489
			December 31, 2019
			Commercial		Agricultural		Total
Credit exposure - by payment activity
Performing			$	3,407,611	$	51,303	$	3,458,914
In workout			—		—		—
Delinquent			—		—		—
Collateral dependent			—		—		—
Principal outstanding			3,407,611		51,303		3,458,914
Unamortized discounts and premiums, net			—		—		—
Deferred fees and costs, net			(899)		(43)		(942)
Amortized cost			3,406,712		51,260		3,457,972
Valuation allowance
Carrying value			(8,979)		(200)		(9,179)
			$	3,397,733	$	51,060	$	3,448,793

Page 18

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Shareholder Information

Corporate Offices:

American Equity Investment Life Holding Company

6000 Westown Parkway

West Des Moines, IA 50266

Inquiries:

Steven Schwartz, Vice President-Investor Relations

(515) 273-3763, sschwartz@american-equity.com

Common Stock and Dividend Information:

New York Stock Exchange symbol: “AEL”

	High	Low	Close	Dividend Declared
2020
First Quarter	$34.16	$9.07	$18.80	$0.00
Second Quarter	$27.09	$14.76	$24.71	$0.00
Third Quarter	$27.32	$19.06	$21.99	$0.00
Fourth Quarter	$34.25	$22.37	$27.66	$0.32
2019
First Quarter	$33.57	$26.34	$27.02	$0.00
Second Quarter	$30.91	$25.84	$27.16	$0.00
Third Quarter	$27.80	$20.16	$24.20	$0.00
Fourth Quarter	$30.96	$21.75	$29.93	$0.30
2018
First Quarter	$35.79	$28.90	$29.36	$0.00
Second Quarter	$37.16	$27.06	$36.00	$0.00
Third Quarter	$38.57	$34.51	$35.36	$0.00
Fourth Quarter	$36.39	$25.27	$27.94	$0.28

Transfer Agent:

Computershare Trust Company, N.A.

P.O. Box 43010

Providence, RI 02940-0310

Phone: (877) 282-1169

Fax: (781) 575-2723

www.computershare.com

Annual Report and Other Information:

Shareholders may receive when available, without charge, a copy of American Equity’s Annual Report, SEC filings and/or press releases by calling Steven Schwartz, Vice President-Investor Relations, at (515) 273-3763 or by visiting our website at www.american-equity.com.

Page 19

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

Financial Supplement - December 31, 2020

Research Analyst Coverage

Erik Bass

Autonomous Research US LP

(646) 561-6248

ebass@autonomous.com

Randy Binner

B. Riley FBR, Inc.

(703) 312-1890

rbinner@fbr.com

Daniel Bergman

Citi Research

(212) 816-2132

daniel.bergman@citi.com

Wilma Burdis

Credit Suisse Securities

Equity Research | Life Insurance

(919) 306-1023

wilma.burdis@credit-suisse.com

Thomas Gallagher

Evercore ISI

(212) 446-9439

thomas.gallagher@evercoreisi.com

Pablo Singzon II

JP Morgan

(212) 622-2295

pablo.s.singzon@jpmorgan.com

Ryan Krueger

Keefe, Bruyette & Woods

(860) 722-5930

rkrueger@kbw.com

Bob Huang

Morgan Stanley Research

(212) 761-6136

Bob.Huang@morganstanley.com

John Barnidge

Piper Sandler & Co.

(312) 281-3412

John.Barnidge@psc.com

C. Gregory Peters

Raymond James & Associates, Inc.

(727) 567-1534

greg.peters@raymondjames.com

Mark A. Dwelle

RBC Capital Markets, LLC

(804) 782-4008

mark.dwelle@rbccm.com

Mark Hughes

Truist Securities

(615) 748-4422

mark.hughes@research.truist.com

Page 20

XML

Cover Page	Feb. 17, 2021
Entity Information [Line Items]
Document Type	8-K
Document Period End Date	Feb. 17, 2021
Entity Registrant Name	AMERICAN EQUITY INVESTMENT LIFE HOLDING CO
Entity Incorporation, State or Country Code	IA
Entity File Number	001-31911
Entity Tax Identification Number	42-1447959
Entity Address, Address Line One	6000 Westown Parkway
Entity Address, City or Town	West Des Moines
Entity Address, State or Province	IA
Entity Address, Postal Zip Code	50266
City Area Code	515
Local Phone Number	221-0002
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Entity Central Index Key	0001039828
Amendment Flag	false
Common Stock
Entity Information [Line Items]
Title of 12(b) Security	Common stock, par value $1
Trading Symbol	AEL
Security Exchange Name	NYSE
Preferred Stock, Series A
Entity Information [Line Items]
Title of 12(b) Security	Depositary Shares, each representing a 1/1,000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock, Series A
Trading Symbol	AELPRA
Security Exchange Name	NYSE
Preferred Stock, Series B
Entity Information [Line Items]
Title of 12(b) Security	Depositary Shares, each representing a 1/1,000th interest in a share of 6.625% Fixed-Rate Reset Non-Cumulative Preferred Stock, Series B
Trading Symbol	AELPRB
Security Exchange Name	NYSE