UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

———————————————

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023 

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to

Commission File No. 001-38469

————————————————

Equitable Holdings, Inc.

(Exact name of registrant as specified in its charter) 

Delaware	90-0226248
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1290 Avenue of the Americas, New York, New York                 10104

(Address of principal executive offices) (Zip Code)

(212) 554-1234

(Registrant’s telephone number, including area code)

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

Title of each class	Trading symbol	Name of each exchange on which registered
Common Stock	EQH	New York Stock Exchange
Depositary Shares, each representing a 1/1,000th interest in a share of Fixed Rate Noncumulative Perpetual Preferred Stock, Series A	EQH PR A	New York Stock Exchange
Depositary Shares, each representing a 1/1,000th interest in a share of Fixed Rate Noncumulative Perpetual Preferred Stock, Series C	EQH PR C	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes ☒    No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an “emerging growth company”. See definition of “accelerated filer,” “large accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐	Non-accelerated filer	☐	Smaller reporting company	☐	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. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 4, 2023, 356,083,251 shares of the registrant’s Common Stock, $0.01 par value, were outstanding.

Table of Contents

TABLE OF CONTENTS

		Page
PART I - FINANCIAL INFORMATION
Item 1.	Consolidated Financial Statements (Unaudited)
	Consolidated Balance Sheets, March 31, 2023 and December 31, 2022	4
	Consolidated Statements of Income (Loss), Three Months Ended March 31, 2023 and 2022	6
	Consolidated Statements of Comprehensive Income (Loss), Three Months Ended March 31, 2023 and 2022	7
	Consolidated Statements of Equity, Three Months Ended March 31, 2023 and 2022	8
	Consolidated Statements of Cash Flows, Three Months Ended March 31, 2023 and 2022	9
	Notes to Consolidated Financial Statements:
	Note 1 - Organization	11
	Note 2 - Significant Accounting Policies	12
	Note 3 - Investments	20
	Note 4 - Derivatives	31
	Note 5 - Closed Block	37
	Note 6 - DAC and Other Deferred Assets/Liabilities	39
	Note 7 - Fair Value Disclosures	40
	Note 8 - Liabilities for Future Policyholder Benefits	53
	Note 9 - Market Risk Benefits	57
	Note 10 - Policyholder Account Balances	59
	Note 11 - Employee Benefit Plans	64
	Note 12 - Income Taxes	65
	Note 13 - Equity	65
	Note 14 - Short-term and Long-term Debt	68
	Note 15 - Redeemable Noncontrolling Interest	68
	Note 16 - Commitments and Contingent Liabilities	68
	Note 17 - Business Segment Information	72
	Note 18 - Insurance Group Statutory Financial Information	75
	Note 19 - Earnings per Common Share	76
	Note 20 - Held-For-Sale	76
	Note 21 - Reinsurance	78
	Note 22 - Subsequent Events	80
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	81
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	121
Item 4.	Controls and Procedures	122
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	123
Item 1A.	Risk Factors	123
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	123
Item 3.	Defaults Upon Senior Securities	123
Item 4.	Mine Safety Disclosures	123
Item 5.	Other Information	123
Item 6.	Exhibits	124
Signatures		130

Table of Contents

NOTE REGARDING FORWARD-LOOKING STATEMENTS AND INFORMATION

Certain of the statements included or incorporated by reference in this Quarterly Report on Form 10-Q constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “expects,” “believes,” “anticipates,” “intends,” “seeks,” “aims,” “plans,” “assumes,” “estimates,” “projects,” “should,” “would,” “could,” “may,” “will,” “shall” or variations of such words are generally part of forward-looking statements. Forward-looking statements are made based on management’s current expectations and beliefs concerning future developments and their potential effects upon Equitable Holdings, Inc. (“Holdings”) and its consolidated subsidiaries. “We,” “us” and “our” refer to Holdings and its consolidated subsidiaries, unless the context refers only to Holdings as a corporate entity. There can be no assurance that future developments affecting Holdings will be those anticipated by management. Forward-looking statements include, without limitation, all matters that are not historical facts.

These forward-looking statements are not a guarantee of future performance and involve risks and uncertainties, and there are certain important factors that could cause actual results to differ, possibly materially, from expectations or estimates reflected in such forward-looking statements, including, among others: (i) conditions in the financial markets and economy, including the impact of plateauing or decreasing economic growth and geopolitical conflicts and related economic conditions, equity market declines and volatility, interest rate fluctuations, impacts on our goodwill and changes in liquidity and access to and cost of capital; (ii) operational factors, including reliance on the payment of dividends to Holdings by its subsidiaries, protection of confidential customer information or proprietary business information, operational failures by us or our service providers, potential strategic transactions, changes in accounting standards, and catastrophic events, such as the outbreak of pandemic diseases including COVID-19; (iii) credit, counterparties and investments, including counterparty default on derivative contracts, failure of financial institutions, defaults by third parties and affiliates and economic downturns, defaults and other events adversely affecting our investments; (iv) our reinsurance and hedging programs; (v) our products, structure and product distribution, including variable annuity guaranteed benefits features within certain of our products, variations in statutory capital requirements, financial strength and claims-paying ratings, state insurance laws limiting the ability of our insurance subsidiaries to pay dividends and key product distribution relationships; (vi) estimates, assumptions and valuations, including risk management policies and procedures, potential inadequacy of reserves and experience differing from pricing expectations, amortization of deferred acquisition costs and financial models; (vii) our Investment Management and Research segment, including fluctuations in assets under management and the industry-wide shift from actively-managed investment services to passive services; (viii) recruitment and retention of key employees and experienced and productive financial professionals; (ix) subjectivity of the determination of the amount of allowances and impairments taken on our investments; (x) legal and regulatory risks, including federal and state legislation affecting financial institutions, insurance regulation and tax reform; (xi) risks related to our common stock and (xii) general risks, including strong industry competition, information systems failing or being compromised and protecting our intellectual property.

Forward-looking statements should be read in conjunction with the other cautionary statements, risks, uncertainties and other factors identified in Holdings’ Annual Report on Form 10-K for the year ended December 31, 2022, as amended or supplemented in our subsequently filed Quarterly Reports on Form 10-Q, including in the section entitled “Risk Factors,” and elsewhere in this Quarterly Report on Form 10-Q. You should read this Form 10-Q completely and with the understanding that actual future results may be materially different from expectations. 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.

Other risks, uncertainties and factors, including those discussed under “Risk Factors”, in our Annual Report on Form 10-K could cause our actual results to differ materially from those projected in any forward-looking statements we make. Readers should read carefully the factors described in “Risk Factors” in our Annual Report on Form 10-K to better understand the risks and uncertainties inherent in our business and underlying any forward-looking statements.

Throughout this Quarterly Report on Form 10-Q we use certain defined terms and abbreviations, which are summarized in the “Glossary” and “Acronyms” sections.

2

Table of Contents

Part I FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements (Unaudited)

3

EQUITABLE HOLDINGS, INC.

Consolidated Balance Sheets

March 31, 2023 and December 31, 2022 (Unaudited)

	March 31, 2023		December 31, 2022
	(in millions, except share data)
ASSETS
Investments:
Fixed maturities available-for-sale, at fair value (amortized cost of $73,061 and $72,991) (allowance for credit losses of $18 and $24)	$	65,065	$	63,361
Fixed maturities, at fair value using the fair value option (1)	1,543		1,508
Mortgage loans on real estate (net of allowance for credit losses of $139 and $129) (1)	16,969		16,481
Policy loans	4,028		4,033
Other equity investments (1)	3,179		3,152
Trading securities, at fair value	828		677
Other invested assets (1)	4,611		3,885
Total investments	96,223		93,097
Cash and cash equivalents (1)	5,018		4,281
Cash and securities segregated, at fair value	1,055		1,522
Broker-dealer related receivables	2,203		2,338
Deferred policy acquisition costs	6,419		6,369
Goodwill and other intangible assets, net	5,478		5,482
Amounts due from reinsurers (allowance for credit losses of $7 and $10) (3)	8,453		8,471
Current and deferred income taxes	1,294		781
Purchased market risk benefits	10,676		10,423
Other assets (1)	3,629		4,033
Assets held-for-sale	671		562
Assets for market risk benefits	629		490
Separate Accounts assets	119,752		114,853
Total Assets	$	261,500	$	252,702
LIABILITIES
Policyholders’ account balances	$	86,761	$	83,866
Liability for market risk benefits	15,061		15,766
Future policy benefits and other policyholders' liabilities	16,738		16,603
Broker-dealer related payables	888		715
Customer related payables	2,595		3,323
Amounts due to reinsurers	1,428		1,533
Short-term debt	751		759
Long-term debt	3,819		3,322
Notes issued by consolidated variable interest entities, at fair value using the fair value option (1)	1,169		1,150
Other liabilities (1)	6,296		7,108
Liabilities held-for-sale	158		108
Separate Accounts liabilities	119,752		114,853
Total Liabilities	$	255,416	$	249,106
Redeemable noncontrolling interest (1) (2)	$	613	$	455
Commitments and contingent liabilities (4)
EQUITY
Equity attributable to Holdings:
Preferred stock and additional paid-in capital, $1 par value and $25,000 liquidation preference	$	1,562	$	1,562
Common stock, $0.01 par value, 2,000,000,000 shares authorized; 505,641,286 and 508,418,442 shares issued, respectively; 359,089,998 and 365,081,940 shares outstanding, respectively	4		4
Additional paid-in capital	2,298		2,299
Treasury stock, at cost, 146,569,130 and 143,336,502 shares, respectively	(3,400)		(3,297)
Retained earnings	9,806		9,825
Accumulated other comprehensive income (loss)	(6,516)		(8,992)
Total equity attributable to Holdings	3,754		1,401
Noncontrolling interest	1,717		1,740
Total Equity	5,471		3,141
Total Liabilities, Redeemable Noncontrolling Interest and Equity	$	261,500	$	252,702

____________

(1)    See Note 2 of the Notes to these Consolidated Financial Statements for details of balances with VIEs.

(2)    See Note 15 of the Notes to these Consolidated Financial Statements for details of redeemable noncontrolling interest.

(3)    Represents the fair value of the ceded reserves to Venerable. See Note 1 of the Notes to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 for details of the Venerable Transaction and Note 7 of the Notes to these Consolidated Financial Statements.

(4)    See Note 16 of the Notes to these Consolidated Financial Statements for details of commitments and contingent liabilities.

4

EQUITABLE HOLDINGS, INC.

Consolidated Balance Sheets

March 31, 2023 and December 31, 2022 (Unaudited)

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

5

EQUITABLE HOLDINGS, INC.

Consolidated Statements of Income (Loss)

Three Months Ended March 31, 2023 and 2022 (Unaudited)

	Three Months Ended March 31,
	2023		2022
	(in millions, except per share data)
REVENUES
Policy charges and fee income	$	588	$	650
Premiums	276		247
Net derivative gains (losses)	(841)		159
Net investment income (loss)	990		804
Investment gains (losses), net:
Credit and intent to sell losses on available for sale debt securities and loans	(66)		10
Other investment gains (losses), net	(21)		(336)
Total investment gains (losses), net	(87)		(326)
Investment management and service fees	1,180		1,355
Other income	251		257
Total revenues	2,357		3,146
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	730		802
Remeasurement of liability for future policy benefits	4		22
Change in market risk benefits and purchased market risk benefits	20		(467)
Interest credited to policyholders’ account balances	463		313
Compensation and benefits	583		596
Commissions and distribution-related payments	380		422
Interest expense	61		47
Amortization of deferred policy acquisition costs	152		143
Other operating costs and expenses	423		534
Total benefits and other deductions	2,816		2,412
Income (loss) from continuing operations, before income taxes	(459)		734
Income tax (expense) benefit	725		(137)
Net income (loss)	266		597
Less: Net income (loss) attributable to the noncontrolling interest	89		67
Net income (loss) attributable to Holdings	177		530
Less: Preferred stock dividends	14		14
Net income (loss) available to Holdings’ common shareholders	$	163	$	516
EARNINGS PER COMMON SHARE
Net income (loss) applicable to Holdings’ common shareholders per common share:
Basic	$	0.45	$	1.33
Diluted	$	0.45	$	1.32
Weighted average common shares outstanding (in millions):
Basic	361.9		388.6
Diluted	364.1		391.7

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

6

EQUITABLE HOLDINGS, INC.

Consolidated Statements of Comprehensive Income (Loss)

Three Months Ended March 31, 2023 and 2022 (Unaudited)

	Three Months Ended March 31,
	2023		2022
	(in millions)
COMPREHENSIVE INCOME (LOSS)
Net income (loss)	$	266	$	597
Other comprehensive income (loss) net of income taxes:
Change in unrealized gains (losses), net of reclassification adjustment	1,626		(4,677)
Changes in market risk benefits - instrument-specific credit risk	938		1,573
Changes in liability for future policy benefits - current discount rate	(112)		462
Changes in defined benefit plan related items not yet recognized in periodic benefit cost, net of reclassification adjustment	20		43
Foreign currency translation adjustment	6		(12)
Total other comprehensive income (loss), net of income taxes	2,478		(2,611)
Comprehensive income (loss)	2,744		(2,014)
Less: Comprehensive income (loss) attributable to the noncontrolling interest	91		63
Comprehensive income (loss) attributable to Holdings	$	2,653	$	(2,077)

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

7

EQUITABLE HOLDINGS, INC.

Consolidated Statements of Equity

Three Months Ended March 31, 2023 and 2022 (Unaudited)

	Three Months Ended March 31,
	Equity Attributable to Holdings
	Preferred Stock and Additional Paid-In Capital		Common Stock		Additional Paid-in Capital		Treasury Stock		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total Holdings Equity		Non-controlling Interest		Total Equity
	(in millions)
January 1, 2023	$	1,562	$	4	$	2,299	$	(3,297)	$	9,825	$	(8,992)	$	1,401	$	1,740	$	3,141
Stock compensation	—		—		11		24		—		—		35		7		42
Purchase of treasury stock	—		—		(3)		(211)		—		—		(214)		—		(214)
Reissuance of treasury stock	—		—		—		—		(25)		—		(25)		—		(25)
Retirement of common stock	—		—		—		84		(84)		—		—		—		—
Repurchase of AB Holding units	—		—		—		—		—		—		—		(18)		(18)
Dividends paid to noncontrolling interest	—		—		—		—		—		—		—		(89)		(89)
Dividends on common stock (cash dividends declared per common share of $0.20)	—		—		—		—		(72)		—		(72)		—		(72)
Dividends on preferred stock	—		—		—		—		(14)		—		(14)		—		(14)
Net income (loss)	—		—		—		—		177		—		177		76		253
Other comprehensive income (loss)	—		—		—		—		—		2,476		2,476		2		2,478
Other	—		—		(9)		—		(1)		—		(10)		(1)		(11)
March 31, 2023	$	1,562	$	4	$	2,298	$	(3,400)	$	9,806	$	(6,516)	$	3,754	$	1,717	$	5,471

January 1, 2022	$	1,562	$	4	$	1,919	$	(2,850)	$	8,413	$	1,303	$	10,351	$	1,576	$	11,927
Stock compensation	—		—		19		31		—		—		50		19		69
Purchase of treasury stock	—		—		(5)		(273)		—		—		(278)		—		(278)
Reissuance of treasury stock	—		—		—		—		(31)		—		(31)		—		(31)
Retirement of common stock	—		—		—		22		(22)		—		—		—		—
Repurchase of AB Holding units	—		—		—		—		—		—		—		(14)		(14)
Dividends paid to noncontrolling interest	—		—		—		—		—		—		—		(139)		(139)
Dividends on common stock (cash dividends declared per common share of $0.18)	—		—		—		—		(70)		—		(70)		—		(70)
Dividends on preferred stock	—		—		—		—		(14)		—		(14)		—		(14)
Issuance of preferred stock	—		—		—		—		—		—		—		—		—
Net income (loss)	—		—		—		—		530		—		530		93		623
Other comprehensive income (loss)	—		—		—		—		—		(2,607)		(2,607)		(4)		(2,611)
Other	—		—		—		—		(4)		—		(4)		(2)		(6)
March 31, 2022	$	1,562	$	4	$	1,933	$	(3,070)	$	8,802	$	(1,304)	$	7,927	$	1,529	$	9,456

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts.

See Notes to Consolidated Financial Statements (Unaudited).

8

EQUITABLE HOLDINGS, INC.

Consolidated Statements of Cash Flows

Three Months Ended March 31, 2023 and 2022 (Unaudited)

	Three Months Ended March 31,
	2023		2022
	(in millions)
Cash flows from operating activities:
Net income (loss)	$	266	$	597
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Interest credited to policyholders’ account balances	463		313
Policy charges and fee income	(588)		(650)
Net derivative (gains) losses	841		(159)
Credit and intent to sell losses on available for sale debt securities and loans	66		(10)
Investment (gains) losses, net	21		336
(Gains) losses on businesses held-for-sale	3		—
Realized and unrealized (gains) losses on trading securities	(34)		92
Non-cash long-term incentive compensation expense	17		38
Amortization and depreciation	224		142
Remeasurement of liability for future policy benefits	4		22
Change in Market Risk Benefits	20		(467)
Equity (income) loss from limited partnerships	(21)		(71)
Changes in:
Net broker-dealer and customer related receivables/payables	(641)		11
Reinsurance recoverable	(456)		(375)
Segregated cash and securities, net	468		(189)
Capitalization of deferred policy acquisition costs	(202)		(210)
Future policy benefits	(95)		43
Current and deferred income taxes (1)	(738)		81
Other, net	(205)		(152)
Net cash provided by (used in) operating activities	$	(587)	$	(608)
Cash flows from investing activities:
Proceeds from the sale/maturity/prepayment of:
Fixed maturities, available-for-sale	$	1,481	$	8,651
Fixed maturities, at fair value using the fair value option	30		252
Mortgage loans on real estate	81		280
Trading account securities	162		45
Short term investments	589		6
Other	211		167
Payment for the purchase/origination of:
Fixed maturities, available-for-sale	(1,846)		(9,198)
Fixed maturities, at fair value using the fair value option	(41)		(254)
Mortgage loans on real estate	(580)		(688)
Trading account securities	(297)		(44)
Short term investments	(804)		(304)
Other	(231)		569
Cash settlements related to derivative instruments, net	(197)		230

See Notes to Consolidated Financial Statements (Unaudited).

9

EQUITABLE HOLDINGS, INC.

Consolidated Statements of Cash Flows

Three Months Ended March 31, 2023 and 2022 (Unaudited)

	Three Months Ended March 31,
	2023		2022
	(in millions)
Investment in capitalized software, leasehold improvements and EDP equipment	(18)		1
Other, net	30		116
Net cash provided by (used in) investing activities	$	(1,430)	$	(171)
Cash flows from financing activities:
Policyholders’ account balances:
Deposits	$	4,375	$	3,228
Withdrawals	(2,655)		(2,257)
Transfers (to) from Separate Accounts	309		454
Payments of market risk benefits	(172)		(122)
Change in short-term financings	(8)		112
Change in collateralized pledged assets	(7)		(40)
Change in collateralized pledged liabilities	665		545
(Decrease) increase in overdrafts payable	—		(15)
Issuance of long-term debt	496		—
Proceeds from notes issued by consolidated VIEs	—		(11)
Dividends paid on common stock	(72)		(70)
Dividends paid on preferred stock	(14)		(14)
Purchases of AB Holding Units to fund long-term incentive compensation plan awards	(18)		(14)
Purchase of treasury shares	(214)		(279)
Purchases (redemptions) of noncontrolling interests of consolidated company-sponsored investment funds	150		(56)
Distribution to noncontrolling interest of consolidated subsidiaries	(89)		(139)
Other, net	3		(7)
Net cash provided by (used in) financing activities	$	2,749	$	1,315
Effect of exchange rate changes on cash and cash equivalents	$	10	$	(11)
Change in cash and cash equivalents	742		525
Cash and cash equivalents, beginning of the period	4,281		5,188
Change in cash of businesses held-for-sale	(5)		—
Cash and cash equivalents, end of the period	$	5,018	$	5,713
Non-cash transactions from investing and financing activities:
Right-of-use assets obtained in exchange for lease obligations	$	10	$	29

(1) For the period ended March 31, 2023 includes a release of $614 million deferred tax valuation allowance. Refer to Note 12 of these Consolidated Financial Statements.

Prior period amounts have been adjusted for the implementation of ASU 2018-12: Targeted Improvements to the Accounting for Long-Duration Contracts

See Notes to Consolidated Financial Statements (Unaudited).

10

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited)

1)    ORGANIZATION

Equitable Holdings, Inc. is the holding company for a diversified financial services organization. The Company conducts operations in six segments: Individual Retirement, Group Retirement, Investment Management and Research, Protection Solutions, Wealth Management and Legacy. The Company’s management evaluates the performance of each of these segments independently. See Note 17 to the consolidated financial statements for further information on the change to the reportable segments in the first quarter 2023, which was retrospectively applied.

•The Individual Retirement segment offers a diverse suite of variable annuity products which are primarily sold to affluent and high net worth individuals saving for retirement or seeking retirement income.

•The Group Retirement segment offers tax-deferred investment and retirement services or products to plans sponsored by educational entities, municipalities and not-for-profit entities, as well as small and medium-sized businesses.

•The Investment Management and Research segment provides diversified investment management, research and related solutions globally to a broad range of clients through three main client channels - Institutional, Retail and Private Wealth - and distributes its institutional research products and solutions through Bernstein Research Services. The Investment Management and Research segment reflects the business of AB Holding and ABLP and their subsidiaries (collectively, AB).

•The Protection Solutions segment includes the Company’s life insurance and group employee benefits businesses. The life insurance business offers a variety of VUL, IUL and term life products to help affluent and high net worth individuals, as well as small and medium-sized business owners, with their wealth protection, wealth transfer and corporate needs. Our group employee benefits business offers a suite of life, short- and long-term disability, dental and vision insurance products to small and medium-size businesses across the United States.

•The Wealth Management segment is an emerging leader in the wealth management space with a differentiated advice value proposition that offers discretionary and non-discretionary investment advisory accounts, financial planning and advice, life insurance, and annuity products. In 2023, we began reporting this business separately from our Individual Retirement, Group Retirement and Protection Solutions segments as well as Corporate and Other.

•The Legacy segment consists of our capital intensive fixed-rate GMxB business written prior to 2011. In 2023, we began reporting this business separately from our Individual Retirement business.

The Company reports certain activities and items that are not included in our segments in Corporate and Other. Corporate and Other includes certain of our financing and investment expenses. It also includes: closed block of life insurance (the “Closed Block”), run-off variable annuity reinsurance business, run-off group pension business, run-off health business, benefit plans for our employees, certain strategic investments and certain unallocated items, including capital and related investments, interest expense and corporate expense. AB’s results of operations are reflected in the Investment Management and Research segment. Accordingly, Corporate and Other does not include any items applicable to AB.

As of March 31, 2023 and December 31, 2022, the Company’s economic interest in AB was approximately 61% and 61%, respectively. The General Partner of AB is a wholly-owned subsidiary of the Company. Because the General Partner has the authority to manage and control the business of AB, AB is consolidated in the Company’s financial statements for all periods presented.

Global Atlantic Reinsurance Transaction

On October 3, 2022, Equitable Financial completed the transactions (the “Global Atlantic Transaction”) contemplated by the previously announced Master Transaction Agreement, dated August 16, 2022, by and between Equitable Financial and First Allmerica Financial Life Insurance Company, a Massachusetts-domiciled insurance company (the “Reinsurer”), and a wholly owned subsidiary of Global Atlantic Financial Group.

At the closing of the Global Atlantic Transaction, Equitable Financial and the Reinsurer entered into a Coinsurance and Modified Coinsurance Agreement (the “EQUI-VEST Reinsurance Agreement”), pursuant to which Equitable Financial ceded to the Reinsurer, on a combined coinsurance and modified coinsurance basis, a 50% quota share of approximately 360,000 legacy Group EQUI-VEST deferred variable annuity contracts issued by Equitable Financial

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

between 1980 and 2008, which predominately include Equitable Financial’s highest guaranteed general account crediting rates of 3%, supported by general account assets of approximately $4 billion and $5 billion of Separate Account value (the “Reinsured Contracts”). The Reinsured Contracts predominately include certain of Equitable Financial’s contracts that offer the highest guaranteed general account crediting rates of 3%. At the closing of the Global Atlantic Transaction, the Reinsurer deposited assets supporting the General Account liabilities relating to the Reinsured Contracts into a trust account for the benefit of Equitable Financial, which assets will secure its obligations to Equitable Financial under the EQUI-VEST Reinsurance Agreement. Commonwealth Annuity and Life Insurance Company, an insurance company domiciled in the Commonwealth of Massachusetts and affiliate of the Reinsurer (“Commonwealth”), provided a guarantee of the Reinsurer’s payment obligation to Equitable Financial under the EQUI-VEST Reinsurance Agreement.

The Company transferred assets of $2.8 billion, including primarily available-for-sale securities, cash and policy loans as the consideration for the reinsurance transaction. In addition, the Company recorded $4.1 billion of direct insurance liabilities ceded under the reinsurance contract included in amounts due from reinsurers and $1.2 billion of deferred gain on cost of reinsurance included within other liabilities. Additionally, $5.3 billion of Separate Account liabilities were ceded under a modified coinsurance portion of the agreement.

2)     SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The unaudited interim consolidated financial statements (the “consolidated financial statements”) have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”) on a basis consistent with reporting interim financial information in accordance with instructions to the Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (“SEC”).

In the opinion of management, all adjustments necessary for a fair statement of the financial position and results of operations have been made. All such adjustments are of a normal, recurring nature. Interim results are not necessarily indicative of the results that may be expected for the full year. These financial statements should be read in conjunction with the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Certain prior period amounts were adjusted to reflect the adoption of ASU 2018-12: Financial Services - Insurance (Topic 944).

The accompanying unaudited consolidated financial statements present the consolidated results of operations, financial condition, and cash flows of the Company and its subsidiaries and those investment companies, partnerships and joint ventures in which the Company has control and a majority economic interest as well as those variable interest entities (“VIEs”) that meet the requirements for consolidation.

All significant intercompany transactions and balances have been eliminated in consolidation. The terms “first quarter 2023” and “first quarter 2022” refer to the three months ended March 31, 2023 and 2022, respectively. The terms “first three months of 2023” and “first three months of 2022” refer to the three months ended March 31, 2023 and 2022, respectively.

Certain prior year amounts have been reclassified to conform to the current year’s presentation.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Adoption of New Accounting Pronouncements

Description	Effect on the Financial Statement or Other Significant Matters
ASU 2018-12: Financial Services - Insurance (Topic 944)
This ASU provides targeted improvements to existing recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. The ASU primarily impacts four key areas, including: 1. Measurement of the liability for future policy benefits for traditional and limited payment contracts. The ASU requires companies to review, and if necessary, update cash flow assumptions at least annually for non-participating traditional and limited-payment insurance contracts. The ASU also prescribes the discount rate to be used in measuring the liability for future policy benefits for traditional and limited payment long-duration contracts. 2. Measurement of Market Risk Benefits (“MRBs”). MRBs, as defined under the ASU, will encompass certain GMxB features associated with variable annuity products and other general account annuities with other than nominal market risk. 3. Amortization of deferred acquisition costs. The ASU simplifies the amortization of deferred acquisition costs and other balances amortized in proportion to premiums, gross profits, or gross margins, requiring such balances to be amortized on a constant level basis over the expected term of the contracts. 4. Expanded footnote disclosures. The ASU requires additional disclosures including information about significant inputs, judgements, assumptions and methods used in measurement.	On January 1, 2023, the Company adopted the new accounting standard ASU 2018-12 using the modified retrospective approach, except for MRBs which will use the full retrospective approach. Refer to “Transition impact of ASU 2018-12, Financial Services- Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts” section within this note for further details.

Transition impact of ASU 2018-12, Financial Services—Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts

The Company has not retrospectively adjusted its consolidated financial statements for the year ended December 31, 2020 to reflect the adoption of ASU 2018-12, consistent with the Division of Corporation Finance’s Financial Reporting Manual Section 11410.1.

The Company adopted ASU 2018-12 for liability for future policy benefits (“LFPB”), additional insurance liabilities, DAC and balances amortized on a basis consistent with DAC on a modified retrospective basis. ASU 2018-12 was adopted for MRBs on a full retrospective basis.

For the LFPB, the net transition adjustment has a favorable retained earnings impact due to the exclusion of DAC in loss recognition and Profits-followed-by-loss (“PFBL”) testing, resulting in a lower VISL PFBL liability. The unfavorable impact was offset by the removal of balances related to unrealized gains and losses on investments, any premium deficiency recorded in AOCI, formerly included in loss recognition testing as well as PFBL testing.

For market risk benefits, the transition adjustment to AOCI related to the effect of the changes in the instrument-specific credit risk of market risk benefits between the contract issue and transition date. The remaining transition difference was related to recording market risk benefits at fair value. This change was recorded as an adjustment to retained earnings as of the transition date.

For DAC, and balances amortized on a basis consistent with DAC including sales inducement assets and unearned revenue liabilities, there is no retained earnings impact due to application of the modified transition approach. There is a favorable AOCI impact due to the removal of DAC balances recorded in AOCI, offsetting the unfavorable AOCI impact resulting from LFPB.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The following table presents the effect of transition adjustment to total equity resulting from the adoption of ASU 2018-12 as of January 1, 2021:

	Retained Earnings		Accumulated Other Comprehensive Income		Total
	(in millions)
Liability for future policy benefits	$	30	$	(1,343)	$	(1,313)
Market risk benefits	(3,398)		(902)		(4,300)
DAC	—		1,548		1,548
Unearned revenue liability and sales inducement assets (1)	—		(166)		(166)
Total transition adjustment before taxes	(3,368)		(863)		(4,231)
Income taxes	707		181		888
Total transition adjustment (net of taxes)	$	(2,661)	$	(682)	$	(3,343)

_______________

(1)Unearned revenue liability Included within liability for future policy benefits financial statement line item in the Consolidated Balance Sheet. Sales inducement assets are included in other assets in the consolidated balance sheets.

The following table summarizes the balance of and changes in liability for future policy benefits on January 1, 2021 resulting from the adoption of ASU 2018-12:

	Protection Solutions		Individual Retirement		Corporate & Other				Total
	Term		Payout		Group Pension		Health
	(in millions)
Balance, December 31, 2020	$	1,423	$	3,047	$	771	$	2,100	$	7,341
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	—		(171)		(85)		(100)		(356)
Effect of remeasurement of liability at current single A rate (1)	560		531		94		300		1,485
Balance, January 1, 2021 (1)	1,983		3,407		780		2,300		8,470
Less: Reinsurance Recoverable	(59)		—		—		(1,837)		(1,896)
Balance, January 1, 2021 (1), net of reinsurance	$	1,924	$	3,407	$	780	$	463	$	6,574

________________

(1)LFPB transition table not inclusive of the following transition adjustments to AOCI including Protection Solutions PFBL of $550 million, PDR of $(230) million, Rider Reserves and Term Reinsurance of $(24) million and Corporate and Other of $(111) million.

The following table summarizes the balance of and changes in the net liability position of market risk benefits on January 1, 2021 resulting from the adoption of ASU 2018-12:

	Individual Retirement		Legacy				Total
	GMxB Core		GMxB Legacy		Purchased MRB
			(in millions)
Balance, December 31, 2020	$	2,206	$	19,891	$	(2,572)	$	19,525
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	(4)		(70)		—		(74)
Adjustments for the cumulative effect of the changes in the instrument-specific credit risk between the original contract issuance date and the transition date (1)	505		461		2		968
Adjustments for the remaining difference (exclusive of the instrument specific credit risk change and host contract adjustments) between previous carrying amount and fair value measurement for the MRB (1)	(563)		4,122		(194)		3,365
Balance, January 1, 2021	$	2,144	$	24,404	$	(2,764)	$	23,784

_____________

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

(1)MRB transition table not inclusive of the following transition adjustments to retained earnings and AOCI including Individual Retirement EQUI-VEST of $43 million, SCS of $21 million, Protection Solutions of $(2) million and Group Retirement EQUI-VEST of $(20) million.

The following table summarizes the balance of and changes in DAC on January 1, 2021 resulting from the adoption of ASU 2018-12:

	Protection Solutions								Legacy		Individual Retirement								Group Retirement				Total
	Term		UL (1)		VUL (2)		IUL (3)		GMxB Legacy		GMxB Core		EI (4)		IE (5)		SCS		EG (6)		Momentum
	(in millions)
Balance, December 31, 2020	$	403	$	—	$	—	$	—	$	654	$	1,635	$	134	$	95	$	645	$	553	$	79	$	4,198
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	—		177		714		162		13		11		20		(1)		210		81		22		1,409
Balance, January 1, 2021 (7)	$	403	$	177	$	714	$	162	$	667	$	1,646	$	154	$	94	$	855	$	634	$	101	$	5,607

______________

(1)    “UL” defined as Universal Life

(2)    “VUL” defined as Variable Universal Life

(3)    "IUL” defined as Indexed Universal Life

(4)    “EI” defined as EQUI-VEST Individual

(5)    “IE” defined as Investment Edge

(6)    “EG” defined as EQUI-VEST Group

(7)     DAC transition table not inclusive of Closed Block of $136 million and Protection Solutions of $3 million transition adjustment.

The following tables summarizes the balance of and changes in sales inducement assets and unearned revenue liability on January 1, 2021 resulting from the adoption of ASU 2018-12:

	Sales Inducement Assets
	Legacy		Individual Retirement		Total
	GMxB Legacy		GMxB Core
	(in millions)
Balance, December 31, 2020	$	246	$	158	$	404
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	—		—		—
Balance, January 1, 2021	$	246	$	158	$	404

	Protection Solutions						Total
	Unearned Revenue Liability
	UL		VUL		IUL
Balance, December 31, 2020	$	31	$	438	$	14	$	483
Adjustment for reversal of balances recorded in Accumulated Other Comprehensive Income	29		127		9		165
Balance, January 1, 2021	$	60	$	565	$	23	$	648

DAC

Acquisition costs that vary with and are primarily related to the acquisition of new and renewal insurance business, reflecting incremental direct costs of contract acquisition with independent third parties or employees that are essential to the contract transaction, as well as the portion of employee compensation, including employee fringe benefits and other costs directly related to underwriting, policy issuance and processing, medical inspection, and contract selling for

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

successfully negotiated contracts including commissions, underwriting, agency and policy issue expenses, are deferred.

Contracts are measured on a grouped basis utilizing cohorts consistent with those used in the calculation of future policy benefit reserves. DAC is amortized on a constant level basis for the grouped contracts over the expected term of the contract. For life insurance products, DAC is amortized in proportion to the face amount in force. For annuity products, DAC is amortized in proportion to policy counts. The constant level basis used for amortization determines the current period amortization considering both the current period’s actual experience and future projections. The amortization pattern is revised quarterly on a prospective basis. Amortization of DAC is included in Amortization of DAC, part of total benefits and other deductions.

For some products, policyholders can elect to modify product benefits, features, rights or coverages that occur by the exchange of a contract for a new contract, or by amendment, endorsement, or rider to a contract, or by election or coverage within a contract. These transactions are known as internal replacements. If such modification substantially changes the contract, the associated DAC is written off immediately through income and any new acquisition costs associated with the replacement contract are deferred.

Amount due to and from Reinsurers

For each of its reinsurance agreements, the Company determines whether the agreement provides indemnification against loss or liability relating to insurance risk in accordance with applicable accounting standards. Cessions under reinsurance agreements do not discharge the Company’s obligations as the primary insurer. The Company reviews all contractual features, including those that may limit the amount of insurance risk to which the reinsurer is subject or features that delay the timely reimbursement of claims.

For reinsurance of existing in-force blocks of long-duration contracts that transfer significant insurance risk, the difference, if any, between the amounts paid (received), and the liabilities ceded (assumed) related to the underlying contracts is considered the net cost of reinsurance at the inception of the reinsurance agreement. Subsequent amounts paid (received) on the reinsurance of in-force blocks, as well as amounts paid (received) related to new business, are recorded as premiums ceded (assumed); and amounts due from reinsurers (amounts due to reinsurers) are established.

Assets and liabilities relating to reinsurance agreements with the same reinsurer may be recorded net on the balance sheet if a right of offset exists within the reinsurance agreement. In the event that reinsurers do not meet their obligations to the Company under the terms of the reinsurance agreements, reinsurance recoverable balances could become uncollectible. In such instances, reinsurance recoverable balances are stated net of allowances for uncollectible reinsurance.

Premiums, policy charges and fee income, and policyholders’ benefits include amounts assumed under reinsurance agreements and are net of reinsurance ceded. Amounts received from reinsurers for policy administration are reported in other revenues.

For reinsurance contracts, reinsurance recoverable balances are generally calculated using methodologies and assumptions that are consistent with those used to calculate the direct liabilities.

Ceded reinsurance transactions are recognized and measured in a manner consistent with underlying reinsured contracts, including using consistent assumptions. Assumed and ceded reinsurance contract rights and obligations are accounted for on a basis consistent with our direct contract. The reinsurance cost or benefit for traditional life non-participating and limited-payment contracts is recognized in proportion to the gross premiums of the underlying direct cohorts. The locked-in single A discount rate used to calculate the reinsurance cost or benefit is established at inception of the reinsurance contract. Changes to the single A discount rate are reflected in comprehensive income at each reporting date.

If the Company determines that a reinsurance agreement does not expose the reinsurer to a reasonable possibility of a significant loss from insurance risk, the Company records the agreement using the deposit method of accounting. Deposits received are included in other liabilities and deposits made are included within other assets. As amounts are paid or received, consistent with the underlying contracts, the deposit assets or liabilities are adjusted. Interest on such deposits is recorded as other income or other operating costs and expenses, as appropriate.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Sales Inducement Assets

Sales inducement assets are offered on certain deferred annuity products in the form of either immediate bonus interest credited or enhanced interest crediting rates for a period of time. The interest crediting expense associated with these sales inducement assets is deferred and amortized over the lives of the underlying contracts in a manner consistent with the amortization of DAC. Unamortized balances are included in other assets in the consolidated balance sheets and amortization is included in interest credited to policyholders’ account balances in the consolidated statements of income (loss).

Policyholders’ Account Balances

Policyholders’ account balances relate to contracts or contract features where the Company has no significant insurance risk. This liability represents the contract value that has accrued to the benefit of the policyholder as of the balance sheet date.

Obligations arising from funding agreements are also reported in policyholders’ account balances in the consolidated balance sheets. As a member of the FHLB, the Company has access to collateralized borrowings. The Company may also issue funding agreements to the FHLB. Both the collateralized borrowings and funding agreements would require the Company to pledge qualified mortgage-backed assets and/or government securities as collateral.

Future Policy Benefits and Other Policyholders’ Liabilities

The liability for future policy benefits is estimated based upon the present value of future policy benefits and related claim expenses less the present value of estimated future net premiums where net premium equals gross premium under the contract multiplied by the net premium ratio. Related claim expenses include termination and settlement costs and exclude acquisition costs and non-claim related costs. The liability is estimated using current assumptions that include discount rate, mortality, lapses and expenses. Assumptions are based on judgments that consider the Company’s historical experience, industry data, and other factors.

For participating traditional life insurance policies, future policy benefit liabilities are calculated using a net level premium method based on guaranteed mortality and dividend fund interest rates. The liability for annual dividends represents the accrual of annual dividends earned. Terminal dividends are accrued in proportion to face amount over the life of the contract.

For non-participating traditional life insurance policies (Term) and limited pay contracts (Payout, Pension), contracts are grouped into cohorts by contract type and issue year. The Company quarterly updates its estimate of cash flows using actual experience and current future cash flow assumptions, which is reflected in an updated net premium ratio used to calculate the liability. The ratio of actual and future expected claims to actual and future expected premiums determines the net premium ratio. The policy administration expense assumption is not updated after policy issuance. If actual expenses differ from the original expense assumptions, the differences are recognized in the period identified. The revised net premium ratio is used to determine the updated liability for future policy benefits as of the beginning of the reporting period, discounted at the original contract issuance rate. Changes in the liability due to current discount rates differing from original rates are included in other comprehensive income within the consolidated statement of comprehensive income.

For non-participating traditional life insurance policies and limited pay contracts, the discount rate assumption used is corporate A rated forward curve. We use a forward curve based upon a Bloomberg index. The liability is remeasured each quarter with the remeasurement change reported in other comprehensive income. The locked-in discount rate is generally based on expected investment returns at contract inception for contracts issued prior to January 1, 2021 and the upper medium grade fixed income corporate instrument yield (i.e., single A) at contract inception for contracts issued after January 1, 2021. The Company developed an LDTI discount rate methodology used to calculate the LFPB for its traditional insurance liabilities and constructed a discount rate curve that references upper-medium grade (low credit risk) fixed-income instrument yields (i.e. Single-A rated Corporate bond yields) which are meant to reflect the duration characteristics of the corresponding insurance liabilities. The methodology uses observable market data, where available, and uses various estimation techniques in line with fair value guidance (such as interpolation and extrapolation) where data is limited. Discount rates are updated quarterly.

For limited-payment products, gross premiums received in excess of net premiums are deferred at initial recognition as a deferred profit liability (“DPL”). DPL will be amortized in relation to the expected future benefit payments. As the calculation of the DPL is based on discounted cash flows, interest accrues on the unamortized DPL balance using the discount rate determined at contract issuance. The DPL is updated at the same time as the estimates for cash flows for

17

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

the liability for future policy benefits. Any difference between the recalculated and beginning of period DPL is recognized in remeasurement gain or loss in the consolidated statements of income (loss), Remeasurement of Liability for Future Policy Benefits, part of total benefits and other deductions. On the consolidated balance sheets the DPL is recorded in the liability for future policy benefits.

Additional liabilities for contract or contract feature that provide for additional benefits in addition to the account balance but are not market risk benefits or embedded derivatives (“additional insurance liabilities”) are established by estimating the expected value of death or other insurance benefits in excess of the projected contract accumulation value and recognizing the excess over the estimated life based on expected assessments (i.e., benefit ratio). The liability equals the current benefit ratio multiplied by cumulative assessments recognized to date, plus interest, less cumulative excess payments to date. These reserves are recorded within future policy benefits and other policyholders’ liabilities. The determination of this estimated future policy benefits liability is based on models that involve numerous assumptions and subjective judgments, including those regarding expected market rates of return and volatility, contract surrender and withdrawal rates, and mortality experience. There can be no assurance that actual experience will be consistent with management’s estimates. Assumptions are reviewed annually and updated with the remeasurement gain or loss reflected in total benefit expense.

The Company recognizes an adjustment in other comprehensive income for the additional insurance liabilities for unrealized gains and losses not included when calculating the present value of expected assessments for the benefit ratios.

The Company conducts annual premium deficiency testing except for liability for future policy benefits for non- participating traditional and limited payment contracts. The Company reviews assumptions and determines whether the sum of existing liabilities and the present value of future gross premiums is sufficient to cover the present value of future benefits to be paid and settlement costs. Anticipated investment income is considered when performing premium deficiency for long duration contracts. The anticipated investment income is projected based on current investment portfolio returns grading to long term reinvestment rates over the projection periods, based on anticipated gross reinvestment spreads, defaults and investment expenses. Premium deficiency reserves are recorded in certain instances where the policyholder liability for a particular line of business may not be deficient in the aggregate to trigger loss recognition, but the pattern of earnings may be such that profits are expected to be recognized in earlier years followed by losses in later years. This pattern of profits followed by losses is exhibited in our VISL business and is generated by the cost structure of the product or secondary guarantees in the contract. The secondary guarantee ensures that, subject to specified conditions, the policy will not terminate and will continue to provide a death benefit even if there is insufficient policy value to cover the monthly deductions and charges. We accrue for these PFBL using a dynamic approach that changes over time as the projection of future losses change.

Market Risk Benefits

Market risk benefits (“MRBs”) are contracts or contract features that provide protection to the contract holder from other than nominal capital market risk and expose the Company to other than nominal capital market risk. Market risk benefits include contract features that provide minimum guarantees to policyholders and include GMIB, GMDB, GMWB, GMAB, and ROP DB benefits. MRBs are measured at fair value on a seriatim basis using an ascribed fee approach based upon policyholder behavior projections and risk neutral economic scenarios adjusted based on the facts and circumstances of the Company’s product features. The MRB Asset and MRB Liability will be equal to the average present value of benefits and risk margins less the average present value of ascribed fees. Ascribed fees will consist of the fee needed, under a stochastically generated set of risk-neutral scenarios, so that the mean present value of claims, including any risk charge, is equal to the mean present value of the projected attributed fees which will be capped at average present value of total policyholder contractual fees. The attributed fee percentage is considered a fixed term of the MRB feature and is held static over the life of the contract. Changes in fair value are recognized as a remeasurement gain/loss in the Change in market risk benefits and purchased market risk benefits, part of total benefits and other deductions except for the portion of the change in the fair value due to change in the Company’s own credit risk, which is recognized in other than comprehensive income. Additionally, when an annuitization occurs (for annuitization benefits) or upon extinguishment of the account balance (for withdrawal benefits) the balance related to the MRB will be derecognized and the amount deducted (after derecognition of any related amount included in accumulated other comprehensive income) shall be used in the calculation of the liability for future policy benefits for the payout annuity. Upon derecognition, any related balance will be removed from AOCI.

The Company has issued and continues to offer certain variable annuity products with GMDB and/or contain a GMLB (collectively, the “GMxB features”) which, if elected by the policyholder after a stipulated waiting period from contract issuance, guarantees a minimum lifetime annuity based on predetermined annuity purchase rates that may be

18

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

in excess of what the contract account value can purchase at then-current annuity purchase rates. This minimum lifetime annuity is based on predetermined annuity purchase rates applied to a GMIB base. The Company previously issued certain variable annuity products with GMIB, GWBL, GMWB, and GMAB features. The Company has also assumed reinsurance for products with GMxB features.

Features in ceded reinsurance contracts that meet the definition of MRBs are accounted for at fair value as a purchased MRB. The fees used to determine the fair value of the reinsured market risk benefit are those defined in the reinsurance contract. The expected periodic future premiums would represent cash outflows and the expected future benefits would represent cash inflows in the fair value calculation. On the ceded side, the Purchased MRB will be measured considering the counterparty credit risk of the reinsurer, while the direct contract liabilities will be measured considering the instrument-specific credit risk of the insurer. As a result of the difference in the treatment of the counterparty credit risk, the fair value of the direct and ceded contracts may be different even if the contractual fees and benefits are the same. Changes in instrument-specific credit risk of the Company is included in the fair value of its market risk benefit, whether in an asset or liability position, and whether related to an issued or purchased MRB, is recognized in OCI. The counterparty credit risk of the reinsurer is recorded in the consolidated statements of income (loss).

Troubled Debt Restructuring

The Company invests in commercial and agricultural mortgage loans included in the balance sheet as mortgage loans on real estate. Under certain circumstances, modifications are granted to these contracts. Each modification is evaluated as to whether a TDR has occurred. A modification is a TDR when the borrower is in financial difficulty. The types of modifications made may include reducing the face amount or maturity amount of the debt as originally stated, reducing the contractual interest rate, extending the maturity date at an interest rate lower than current market interest rates and/or reducing accrued interest. The credit allowance is an estimate of lifetime expected losses reflecting historical loss information which included losses from modification to a borrower experiencing financial difficulty. As the effect of the modification made to a borrower experiencing financial difficulty is already included in the credit allowance, the carrying value (net of the allowance) before and after modification through a TDR may not change significantly, or may increase if the expected recovery is higher than the pre-modification recovery assessment. For information pertaining to our TDRs see Note 3 of the Notes to these Consolidated Financial Statements.

Accounting and Consolidation of VIEs

For all new investment products and entities developed by the Company, the Company first determines whether the entity is a VIE, which involves determining an entity’s variability and variable interests, identifying the holders of the equity investment at risk and assessing the five characteristics of a VIE. Once an entity has been determined to be a VIE, the Company then determines whether it is the primary beneficiary of the VIE based on its beneficial interests. If the Company is deemed to be the primary beneficiary of the VIE, then the Company consolidates the entity.

Management of the Company reviews quarterly its investment management agreements and its investments in, and other financial arrangements with, certain entities that hold client AUM to determine the entities that the Company is required to consolidate under this guidance. These entities include certain mutual fund products, hedge funds, structured products, group trusts, collective investment trusts and limited partnerships.

The analysis performed to identify variable interests held, determine whether entities are VIEs or VOEs, and evaluate whether the Company has a controlling financial interest in such entities requires the exercise of judgment and is updated on a continuous basis as circumstances change or new entities are developed. The primary beneficiary evaluation generally is performed qualitatively based on all facts and circumstances, including consideration of economic interests in the VIE held directly and indirectly through related parties and entities under common control, as well as quantitatively, as appropriate.

Consolidated VIEs

Consolidated CLOs

The Company is the investment manager of certain asset-backed investment vehicles, commonly referred to as CLOs, and certain other vehicles for which the Company earns fee income for investment management services. The Company may sell or syndicate investments through these vehicles, principally as part of the strategic investing activity as part of its investment management businesses. Additionally, the Company may invest in securities issued by these vehicles which are eliminated in consolidation of the CLOs.

19

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

As of March 31, 2023 and December 31, 2022, respectively, Equitable Financial holds $89 million and $85 million of equity interests in the CLOs. The Company consolidated the CLOs as of March 31, 2023 and December 31, 2022 as it is the primary beneficiary due to the combination of both its equity interest held by Equitable Financial and the majority ownership of AB, which functions as the CLOs loan manager. The assets of the CLOs are legally isolated from the Company’s creditors and can only be used to settle obligations of the CLOs. The liabilities of the CLOs are non-recourse to the Company and the Company has no obligation to satisfy the liabilities of the CLOs. As of March 31, 2023, Equitable Financial holds $88 million of equity interests in a SPE established to purchase loans from the market in anticipation of a new CLO transaction. The Company consolidated the SPE as of March 31, 2023 as it is the primary beneficiary due to the combination of both its equity interest held by Equitable Financial and the majority ownership of AB, which functions as the SPE loan manager.

Resulting from this consolidation in the Company’s consolidated balance sheets are fixed maturities, at fair value using the fair value option with total assets of $1.5 billion and $1.5 billion notes issued by consolidated variable interest entities, at fair value using the fair value option with total liabilities of $1.2 billion and $1.2 billion at March 31, 2023 and December 31, 2022, respectively. The unpaid outstanding principal balance of the notes and short-term borrowing is $1.4 billion and $1.4 billion at March 31, 2023 and December 31, 2022.

Consolidated Limited Partnerships and LLCs

As of March 31, 2023 and December 31, 2022 the Company consolidated limited partnerships and LLCs for which it was identified as the primary beneficiary under the VIE model. Included in Other invested assets, Mortgage loans on real estate, Other equity investments, Trading securities, cash and other liabilities in the Company’s consolidated balance sheets at March 31, 2023 and December 31, 2022 are total net assets of $925 million and $644 million, respectively related to these VIEs.

Consolidated AB-Sponsored Investment Funds

Included in the Company’s consolidated balance sheet as of March 31, 2023 and December 31, 2022 are assets of $578 million and $581 million, liabilities of $44 million and $56 million, and redeemable noncontrolling interests of $375 million and $369 million, respectively, associated with the consolidation of AB-sponsored investment funds. Also included in the Company’s consolidated balance sheets as of March 31, 2023 and December 31, 2022 are assets of $17 million and $0 million, liabilities of $0 million and $0 million, and redeemable noncontrolling interests of $2 million and $0 million, respectively, from consolidation of AB-sponsored investment funds under the VOE model.

Non-Consolidated VIEs

As of March 31, 2023 and December 31, 2022 respectively, the Company held approximately $2.4 billion and $2.4 billion of investment assets in the form of equity interests issued by non-corporate legal entities determined under the guidance to be VIEs, such as limited partnerships and limited liability companies, including CLOs, hedge funds, private equity funds and real estate-related funds. The Company continues to reflect these equity interests in the consolidated balance sheets as other equity investments and applies the equity method of accounting for these positions. The net assets of these non-consolidated VIEs are approximately $257.1 billion and $282.5 billion as of March 31, 2023 and December 31, 2022 respectively. The Company’s maximum exposure to loss from its direct involvement with these VIEs is the carrying value of its investment of $2.4 billion and $2.4 billion and approximately $1.3 billion and $1.3 billion of unfunded commitments as of March 31, 2023 and December 31, 2022, respectively. The Company has no further economic interest in these VIEs in the form of guarantees, derivatives, credit enhancements or similar instruments and obligations.

Non-Consolidated AB-Sponsored Investment Products

As of March 31, 2023 and December 31, 2022, the net assets of investment products sponsored by AB that are non-consolidated VIEs are approximately $49.0 billion and $46.4 billion, respectively. The Company’s maximum exposure to loss from its direct involvement with these VIEs is its investment of $9 million and $6 million as of March 31, 2023 and December 31, 2022. The Company has no further commitments to or economic interest in these VIEs.

3)    INVESTMENTS

Fixed Maturities AFS

The components of fair value and amortized cost for fixed maturities classified as AFS on the consolidated balance sheets excludes accrued interest receivable because the Company elected to present accrued interest receivable within

20

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

other assets. Accrued interest receivable on AFS fixed maturities as of March 31, 2023 and December 31, 2022 was $616 million and $591 million, respectively. There was no accrued interest written off for AFS fixed maturities for the three months ended March 31, 2023 and 2022.

The following tables provide information relating to the Company’s fixed maturities classified as AFS.

AFS Fixed Maturities by Classification

	Amortized Cost		Allowance for Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in millions)
March 31, 2023
Fixed Maturities:
Corporate (1)	$	51,030	$	18	$	167	$	6,086	$	45,093
U.S. Treasury, government and agency	6,991		—		3		925		6,069
States and political subdivisions	638		—		12		75		575
Foreign governments	1,028		—		3		133		898
Residential mortgage-backed (2)	930		—		1		84		847
Asset-backed (3)	8,548		—		9		315		8,242
Commercial mortgage-backed	3,856		—		—		558		3,298
Redeemable preferred stock	40		—		3		—		43
Total at March 31, 2023	$	73,061	$	18	$	198	$	8,176	$	65,065
December 31, 2022:
Fixed Maturities:
Corporate (1)	$	50,712	$	24	$	89	$	7,206	$	43,571
U.S. Treasury, government and agency	7,054		—		1		1,218		5,837
States and political subdivisions	609		—		7		89		527
Foreign governments	985		—		2		151		836
Residential mortgage-backed (2)	908		—		1		87		822
Asset-backed (3)	8,859		—		4		373		8,490
Commercial mortgage-backed	3,823		—		—		588		3,235
Redeemable preferred stock	41		—		2		—		43
Total at December 31, 2022	$	72,991	$	24	$	106	$	9,712	$	63,361

______________

(1)Corporate fixed maturities include both public and private issues.

(2)Includes publicly traded agency pass-through securities and collateralized obligations.

(3)Includes credit-tranched securities collateralized by sub-prime mortgages, credit risk transfer securities and other asset types.

The contractual maturities of AFS fixed maturities as of March 31, 2023 are shown in the table below. Bonds not due at a single maturity date have been included in the table in the final year of maturity. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

21

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Contractual Maturities of AFS Fixed Maturities

	Amortized Cost (Less Allowance for Credit Losses)		Fair Value
	(in millions)
March 31, 2023
Contractual maturities:
Due in one year or less	$	1,551	$	1,533
Due in years two through five	15,798		15,107
Due in years six through ten	16,462		15,023
Due after ten years	25,858		20,972
Subtotal	59,669		52,635
Residential mortgage-backed	930		847
Asset-backed	8,548		8,242
Commercial mortgage-backed	3,856		3,298
Redeemable preferred stock	40		43
Total at March 31, 2023	$	73,043	$	65,065

The following table shows proceeds from sales, gross gains (losses) from sales and allowance for credit losses for AFS fixed maturities.

Proceeds from Sales, Gross Gains (Losses) from Sales and Allowance for Credit and Intent to Sell Losses for AFS Fixed Maturities

	Three Months Ended March 31,
	2023		2022
	(in millions)
Proceeds from sales	$	825	$	7,391
Gross gains on sales	$	2	$	29
Gross losses on sales	$	(26)	$	(364)
Net (increase) decrease in Allowance for Credit and Intent to Sell losses	$	(56)	$	1

The following table sets forth the amount of credit loss impairments on AFS fixed maturities held by the Company at the dates indicated and the corresponding changes in such amounts.

AFS Fixed Maturities - Credit and Intent to Sell Loss Impairments

	Three Months Ended March 31,
	2023		2022
	(in millions)
Balance, beginning of period	$	36	$	44
Previously recognized impairments on securities that matured, paid, prepaid or sold	(3)		(2)
Recognized impairments on securities impaired to fair value this period (1) (2)	52		—
Credit losses recognized this period on securities for which credit losses were not previously recognized	3		—
Additional credit losses this period on securities previously impaired	1		1
Increases due to passage of time on previously recorded credit losses	—		—
Accretion of previously recognized impairments due to increases in expected cash flows (for OTTI securities 2019 and prior)	—		—
Balance at March 31,	$	89	$	43

22

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

______________

(1)Represents circumstances where the Company determined in the current period that it intends to sell the security, or it is more likely than not that it will be required to sell the security before recovery of the security’s amortized cost.

(2)Amounts reflected for the three months ended March 31, 2023 represent AFS fixed maturities in an unrealized loss position, which the Company intends to sell in anticipation of Equitable Financial’s ordinary dividend to Holdings.

The tables that follow below present a roll-forward of net unrealized investment gains (losses) recognized in AOCI.

Net Unrealized Gains (Losses) on AFS Fixed Maturities

	Net Unrealized Gains (Losses) on Investments		Policyholders’ Liabilities		Deferred Income Tax Asset (Liability)		AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses)
	(in millions)
Balance, January 1, 2023	$	(9,606)	$	41	$	440	$	(9,125)
Net investment gains (losses) arising during the period	1,555		—		—		1,555
Reclassification adjustment:
Included in net income (loss)	80		—		—		80
Other	—		—		—		—
Impact of net unrealized investment gains (losses)	—		(8)		(342)		(350)
Net unrealized investment gains (losses) excluding credit losses	(7,971)		33		98		(7,840)
Net unrealized investment gains (losses) with credit losses	(7)		—		1		(6)
Balance, March 31, 2023	$	(7,978)	$	33	$	99	$	(7,846)
Balance, January 1, 2022	$	4,809	$	(169)	$	(974)	$	3,666
Net investment gains (losses) arising during the period	(6,425)		—		—		(6,425)
Reclassification adjustment:
Included in net income (loss)	334		—		—		334
Other	—		—		—		—
Impact of net unrealized investment gains (losses)	—		173		1,242		1,415
Net unrealized investment gains (losses) excluding credit losses	(1,282)		4		268		(1,010)
Net unrealized investment gains (losses) with credit losses	(5)		—		1		(4)
Balance, March 31, 2022	$	(1,287)	$	4	$	269	$	(1,014)

The following tables disclose the fair values and gross unrealized losses of the 4,949 issues as of March 31, 2023 and the 5,209 issues as of December 31, 2022 that are not deemed to have credit losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position for the specified periods at the dates indicated.

AFS Fixed Maturities in an Unrealized Loss Position for Which No Allowance Is Recorded

	Less Than 12 Months				12 Months or Longer				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(in millions)
March 31, 2023
Fixed Maturities:
Corporate	$	8,624	$	401	$	30,610	$	5,683	$	39,234	$	6,084
U.S. Treasury, government and agency	3,271		277		2,584		648		5,855		925

23

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	Less Than 12 Months				12 Months or Longer				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(in millions)
States and political subdivisions	36		2		269		73		305		75
Foreign governments	106		6		645		127		751		133
Residential mortgage-backed	295		11		517		73		812		84
Asset-backed	1,458		36		5,933		279		7,391		315
Commercial mortgage-backed	425		30		2,805		528		3,230		558
Total at March 31, 2023	$	14,215	$	763	$	43,363	$	7,411	$	57,578	$	8,174
December 31, 2022:
Fixed Maturities:
Corporate	$	24,580	$	2,668	$	16,534	$	4,536	$	41,114	$	7,204
U.S. Treasury, government and agency	5,564		1,200		204		18		5,768		1,218
States and political subdivisions	130		25		173		64		303		89
Foreign governments	349		42		417		109		766		151
Residential mortgage-backed	671		49		83		38		754		87
Asset-backed	6,298		230		1,765		143		8,063		373
Commercial mortgage-backed	1,577		201		1,640		387		3,217		588
Total at December 31, 2022	$	39,169	$	4,415	$	20,816	$	5,295	$	59,985	$	9,710

The Company’s investments in fixed maturities do not include concentrations of credit risk of any single issuer greater than 10% of the consolidated equity of the Company, other than securities of the U.S. government, U.S. government agencies, and certain securities guaranteed by the U.S. government. The Company maintains a diversified portfolio of corporate securities across industries and issuers and does not have exposure to any single issuer in excess of 0.9% of total corporate securities. The largest exposures to a single issuer of corporate securities held as of March 31, 2023 and December 31, 2022 were $387 million and $327 million, respectively, representing 7.1% and 10.4% of the consolidated equity of the Company.

Corporate high yield securities, consisting primarily of public high yield bonds, are classified as other than investment grade by the various rating agencies, i.e., a rating below Baa3/BBB- or the NAIC designation of 3 (medium investment grade), 4 or 5 (below investment grade) or 6 (in or near default). As of March 31, 2023 and December 31, 2022, respectively, approximately $2.8 billion and $2.9 billion, or 3.8% and 4.0%, of the $73.1 billion and $73.0 billion aggregate amortized cost of fixed maturities held by the Company were considered to be other than investment grade. These securities had gross unrealized losses of $166 million and $208 million as of March 31, 2023 and December 31, 2022, respectively.

As of March 31, 2023 and December 31, 2022, respectively, the $7.4 billion and $5.3 billion of gross unrealized losses of twelve months or more were primarily concentrated in corporate securities. In accordance with the policy described in Note 2 of the Notes to these Consolidated Financial Statements, the Company concluded that an adjustment to the allowance for credit losses for these securities was not warranted at either March 31, 2023 or December 31, 2022. As of March 31, 2023 and December 31, 2022, the Company did not intend to sell the securities nor will it likely be required to dispose of the securities before the anticipated recovery of their remaining amortized cost basis.

Based on the Company’s evaluation both qualitatively and quantitatively of the drivers of the decline in fair value of fixed maturity securities as of March 31, 2023, the Company determined that the unrealized loss was primarily due to increases in interest rates and credit spreads.

Mortgage Loans on Real Estate

Accrued interest receivable on commercial and agricultural mortgage loans as of March 31, 2023 and December 31, 2022 was $72 million and $71 million, respectively. There was no accrued interest written off for commercial and agricultural mortgage loans for the three months ended March 31, 2023 and 2022.

24

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

As of March 31, 2023, the Company had no loans for which foreclosure was probable included within the individually assessed mortgage loans, and accordingly had no associated allowance for credit losses.

Allowance for Credit Losses on Mortgage Loans

The change in the allowance for credit losses for commercial mortgage loans and agricultural mortgage loans during the three months ended March 31, 2023 and 2022 were as follows:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Allowance for credit losses on mortgage loans:
Commercial mortgages:
Balance, beginning of period	$	123	$	57
Current-period provision for expected credit losses	10		(10)
Write-offs charged against the allowance	—		—
Recoveries of amounts previously written off	—		—
Net change in allowance	10		(10)
Balance, end of period	$	133	$	47
Agricultural mortgages:
Balance, beginning of period	$	6	$	5
Current-period provision for expected credit losses	—		1
Write-offs charged against the allowance	—		—
Recoveries of amounts previously written off	—		—
Net change in allowance	—		1
Balance, end of period	$	6	$	6
Total allowance for credit losses	$	139	$	53

The change in the allowance for credit losses is attributable to:

•increases/decreases in the loan balance due to new originations, maturing mortgages, and loan amortization; and

•changes in credit quality and economic assumptions.

Credit Quality Information

The following tables summarize the Company’s mortgage loans segregated by risk rating exposure as of March 31, 2023 and December 31, 2022.

Loan to Value (“LTV”) Ratios (1)

	March 31, 2023
	Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Mortgage loans:
Commercial:
0% - 50%	$	—	$	679	$	130	$	—	$	—	$	1,466	$	—	$	—	$	2,275

25

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	March 31, 2023
	Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
50% - 70%	237		2,230		1,568		906		312		2,911		268		94		8,526
70% - 90%	243		364		382		463		328		1,635		28		34		3,477
90% plus	—		—		33		—		—		225		—		—		258
Total commercial	$	480	$	3,273	$	2,113	$	1,369	$	640	$	6,237	$	296	$	128	$	14,536
Agricultural:
0% - 50%	$	10	$	164	$	182	$	237	$	128	$	847	$	—	$	—	$	1,568
50% - 70%	11		188		182		208		67		332		—		—		988
70% - 90%	—		—		—		—		—		16		—		—		16
90% plus	—		—		—		—		—		—		—		—		—
Total agricultural	$	21	$	352	$	364	$	445	$	195	$	1,195	$	—	$	—	$	2,572
Total mortgage loans:
0% - 50%	$	10	$	843	$	312	$	237	$	128	$	2,313	$	—	$	—	$	3,843
50% - 70%	248		2,418		1,750		1,114		379		3,243		268		94		9,514
70% - 90%	243		364		382		463		328		1,651		28		34		3,493
90% plus	—		—		33		—		—		225		—		—		258
Total mortgage loans	$	501	$	3,625	$	2,477	$	1,814	$	835	$	7,432	$	296	$	128	$	17,108

Debt Service Coverage (“DSC”) Ratios (2)

	March 31, 2023
	Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Mortgage loans:
Commercial:
Greater than 2.0x	$	—	$	783	$	1,160	$	1,113	$	102	$	2,634	$	—	$	—	$	5,792
1.8x to 2.0x	—		94		180		164		288		605		242		94		1,667
1.5x to 1.8x	—		400		490		32		195		1,234		—		—		2,351
1.2x to 1.5x	307		1,041		194		—		—		854		—		—		2,396
1.0x to 1.2x	166		496		41		60		55		840		54		34		1,746
Less than 1.0x	7		459		48		—		—		70		—		—		584
Total commercial	$	480	$	3,273	$	2,113	$	1,369	$	640	$	6,237	$	296	$	128	$	14,536
Agricultural:
Greater than 2.0x	$	2	$	51	$	40	$	61	$	21	$	189	$	—	$	—	$	364

26

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	March 31, 2023
	Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
1.8x to 2.0x	—		16		57		33		24		67		—		—		197
1.5x to 1.8x	6		69		31		110		18		213		—		—		447
1.2x to 1.5x	4		107		156		177		97		391		—		—		932
1.0x to 1.2x	5		90		80		60		29		310		—		—		574
Less than 1.0x	4		19		—		4		6		25		—		—		58
Total agricultural	$	21	$	352	$	364	$	445	$	195	$	1,195	$	—	$	—	$	2,572
Total mortgage loans:
Greater than 2.0x	$	2	$	834	$	1,200	$	1,174	$	123	$	2,823	$	—	$	—	$	6,156
1.8x to 2.0x	—		110		237		197		312		672		242		94		1,864
1.5x to 1.8x	6		469		521		142		213		1,447		—		—		2,798
1.2x to 1.5x	311		1,148		350		177		97		1,245		—		—		3,328
1.0x to 1.2x	171		586		121		120		84		1,150		54		34		2,320
Less than 1.0x	11		478		48		4		6		95		—		—		642
Total mortgage loans	$	501	$	3,625	$	2,477	$	1,814	$	835	$	7,432	$	296	$	128	$	17,108

______________

(1)The LTV ratio is derived from current loan balance divided by the fair value of the property. The fair value of the underlying commercial properties is updated annually for each mortgage loan.

(2)The DSC ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.

LTV Ratios (1)

	December 31, 2022
	Amortized Cost Basis by Origination Year
	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Mortgage loans:
Commercial:
0% - 50%	$	624	$	130	$	—	$	—	$	119	$	1,259	$	—	$	—	$	2,132
50% - 70%	2,285		1,569		906		313		623		2,254		328		—		8,278
70% - 90%	363		415		463		329		424		1,314		—		34		3,342
90% plus	—		—		—		—		35		233		—		—		268
Total commercial	$	3,272	$	2,114	$	1,369	$	642	$	1,201	$	5,060	$	328	$	34	$	14,020
Agricultural:
0% - 50%	$	163	$	182	$	228	$	129	$	132	$	725	$	—	$	—	$	1,559
50% - 70%	190		185		222		68		83		267		—		—		1,015
70% - 90%	—		—		—		—		—		16		—		—		16
90% plus	—		—		—		—		—		—		—		—		—

27

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	December 31, 2022
	Amortized Cost Basis by Origination Year
	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Total agricultural	$	353	$	367	$	450	$	197	$	215	$	1,008	$	—	$	—	$	2,590
Total mortgage loans:
0% - 50%	$	787	$	312	$	228	$	129	$	251	$	1,984	$	—	$	—	$	3,691
50% - 70%	2,475		1,754		1,128		381		706		2,521		328		—		9,293
70% - 90%	363		415		463		329		424		1,330		—		34		3,358
90% plus	—		—		—		—		35		233		—		—		268
Total mortgage loans	$	3,625	$	2,481	$	1,819	$	839	$	1,416	$	6,068	$	328	$	34	$	16,610

DSC Ratios (2)

	December 31, 2022
	Amortized Cost Basis by Origination Year
	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Mortgage loans:
Commercial:
Greater than 2.0x	$	771	$	1,159	$	1,113	$	102	$	571	$	1,923	$	—	$	—	$	5,639
1.8x to 2.0x	158		215		164		197		186		482		279		—		1,681
1.5x to 1.8x	337		390		32		153		176		1,175		4		—		2,267
1.2x to 1.5x	1,041		259		—		92		73		917		—		—		2,382
1.0x to 1.2x	507		43		60		98		160		492		45		34		1,439
Less than 1.0x	458		48		—		—		35		71		—		—		612
Total commercial	$	3,272	$	2,114	$	1,369	$	642	$	1,201	$	5,060	$	328	$	34	$	14,020

28

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	December 31, 2022
	Amortized Cost Basis by Origination Year
	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans Amortized Cost Basis		Total
	(in millions)
Agricultural:
Greater than 2.0x	$	51	$	40	$	62	$	21	$	12	$	193	$	—	$	—	$	379
1.8x to 2.0x	16		58		35		24		14		51		—		—		198
1.5x to 1.8x	69		42		111		18		19		196		—		—		455
1.2x to 1.5x	107		147		177		98		99		298		—		—		926
1.0x to 1.2x	91		80		61		30		60		257		—		—		579
Less than 1.0x	19		—		4		6		11		13		—		—		53
Total agricultural	$	353	$	367	$	450	$	197	$	215	$	1,008	$	—	$	—	$	2,590
Total mortgage loans:
Greater than 2.0x	$	822	$	1,199	$	1,175	$	123	$	583	$	2,116	$	—	$	—	$	6,018
1.8x to 2.0x	174		273		199		221		200		533		279		—		1,879
1.5x to 1.8x	406		432		143		171		195		1,371		4		—		2,722
1.2x to 1.5x	1,148		406		177		190		172		1,215		—		—		3,308
1.0x to 1.2x	598		123		121		128		220		749		45		34		2,018
Less than 1.0x	477		48		4		6		46		84		—		—		665
Total mortgage loans	$	3,625	$	2,481	$	1,819	$	839	$	1,416	$	6,068	$	328	$	34	$	16,610

______________

(1)The LTV ratio is derived from current loan balance divided by the fair value of the property. The fair value of the underlying commercial properties is updated annually for each mortgage loan.

(2)The DSC ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service.

Past-Due and Nonaccrual Mortgage Loan Status

The following table provides information relating to the aging analysis of past-due mortgage loans as of March 31, 2023 and December 31, 2022, respectively.

Age Analysis of Past Due Mortgage Loans (1)

	Accruing Loans												Non-accruing Loans		Total Loans		Non-accruing Loans with No Allowance		Interest Income on Non-accruing Loans
	Past Due								Current		Total
	30-59 Days		60-89 Days		90 Days or More		Total
	(in millions)
March 31, 2023:
Mortgage loans:
Commercial	$	62	$	—	$	—	$	62	$	14,383	$	14,445	$	91	$	14,536	$	—	$	1
Agricultural	17		11		15		43		2,510		2,553		19		2,572		3		—
Total	$	79	$	11	$	15	$	105	$	16,893	$	16,998	$	110	$	17,108	$	3	$	1

29

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	Accruing Loans												Non-accruing Loans		Total Loans		Non-accruing Loans with No Allowance		Interest Income on Non-accruing Loans
	Past Due								Current		Total
	30-59 Days		60-89 Days		90 Days or More		Total
	(in millions)
December 31, 2022:
Mortgage loans:
Commercial	$	56	$	—	$	—	$	56	$	13,964	$	14,020	$	—	$	14,020	$	—	$	—
Agricultural	3		5		13		21		2,553		2,574		16		2,590		—		—
Total	$	59	$	5	$	13	$	77	$	16,517	$	16,594	$	16	$	16,610	$	—	$	—

_______________

(1)Amounts presented at amortized cost basis.

As of March 31, 2023 and December 31, 2022, the carrying values of problem mortgage loans that had been classified as non-accrual loans were $17 million and $14 million, respectively. The carrying values of those mortgage loans are presented net of an allowance of $2 million and $2 million, respectively, as of March 31, 2023 and December 31, 2022.

Troubled Debt Restructuring

During the three months ended March 31, 2023, we granted a modification to a $56 million commercial real estate loan, which is 0.3% of the mortgage loans on real estate. The modification reflects a pay and accrue structure where the loan was converted to interest only, and the pay rate is lower than the current rate beginning in 2023; 0.35% in 2023 and stepping up annually until it reaches the existing coupon of 5.0% in 2027. Interest between the pay rate and the coupon rate will be accrued and added to the loan monthly. Additionally, any excess cash flow above the pay rate will be applied to the loan. For the accounting policy pertaining to our TDRs see Note 2 of the Notes to these Consolidated Financial Statements.

During the three months ended March 31, 2022, the Company identified an immaterial amount of TDRs.

Equity Securities

The table below presents a breakdown of unrealized and realized gains and (losses) on equity securities during the three months ended March 31, 2023 and 2022.

Unrealized and Realized Gains (Losses) from Equity Securities

	Three Months Ended March 31,
	2023		2022
	(in millions)
Net investment gains (losses) recognized during the period on securities held at the end of the period	$	(3)	$	(40)
Net investment gains (losses) recognized on securities sold during the period	—		(13)
Unrealized and realized gains (losses) on equity securities	$	(3)	$	(53)

Trading Securities

As of March 31, 2023 and December 31, 2022, respectively, the fair value of the Company’s trading securities was $828 million and $677 million. As of March 31, 2023 and December 31, 2022, respectively, trading securities included the General Account’s investment in Separate Accounts had carrying values of $46 million and $39 million.

The table below shows a breakdown of net investment income (loss) from trading securities during the three months ended March 31, 2023 and 2022.

30

Net Investment Income (Loss) from Trading Securities

	Three Months Ended March 31,
	2023		2022
	(in millions)
Net investment gains (losses) recognized during the period on securities held at the end of the period	$	35	$	(94)
Net investment gains (losses) recognized on securities sold during the period	(1)		2
Unrealized and realized gains (losses) on trading securities	34		(92)
Interest and dividend income from trading securities	5		16
Net investment income (loss) from trading securities	$	39	$	(76)

Fixed maturities, at fair value using the fair value option

The table below shows a breakdown of net investment income (loss) from fixed maturities, at fair value using the fair value option during the three months ended March 31, 2023 and 2022.

Net Investment Income (Loss) from Fixed Maturities, at Fair Value using the Fair Value Option

	Three Months Ended March 31,
	2023		2022
	(in millions)
Net investment gains (losses) recognized during the period on securities held at the end of the period	$	4	$	(5)
Net investment gains (losses) recognized on securities sold during the period	(2)		6
Unrealized and realized gains (losses) from fixed maturities	2		1
Interest and dividend income from fixed maturities	7		16
Net investment income (loss) from fixed maturities	$	9	$	17

4)     DERIVATIVES

The Company uses derivatives as part of its overall asset/liability risk management primarily to reduce exposures to equity market and interest rate risks. Derivative hedging strategies are designed to reduce these risks from an economic perspective and are all executed within the framework of a “Derivative Use Plan” approved by applicable states’ insurance law. Derivatives are generally not accounted for using hedge accounting, with the exception of TIPS and cash flow hedges, which are discussed further below. Operation of these hedging programs is based on models involving numerous estimates and assumptions, including, among others, mortality, lapse, surrender and withdrawal rates, election rates, fund performance, market volatility and interest rates. A wide range of derivative contracts are used in these hedging programs, including exchange traded equity, currency and interest rate futures contracts, total return and/or other equity swaps, interest rate swap and floor contracts, bond and bond-index total return swaps, swaptions, variance swaps and equity options, credit and foreign exchange derivatives, as well as bond and repo transactions to support the hedging. The derivative contracts are collectively managed in an effort to reduce the economic impact of unfavorable changes in guaranteed benefits’ exposures attributable to movements in capital markets. In addition, as part of its hedging strategy, the Company targets an asset level for all variable annuity products at or above a CTE98 level under most economic scenarios (CTE is a statistical measure of tail risk which quantifies the total asset requirement to sustain a loss if an event outside a given probability level has occurred. CTE98 denotes the financial resources a company would need to cover the average of the worst 2% of scenarios.)

Derivatives Utilized to Hedge Exposure to Variable Annuities with Guarantee Features

The Company has issued and continues to offer variable annuity products with GMxB features which are accounted for as market risk benefits. The risk associated with the GMDB feature is that under-performance of the financial markets could result in GMDB benefits, in the event of death, being higher than what accumulated policyholders’ account balances would support. The risk associated with the GMIB feature is that under-performance of the financial

31

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

markets could result in the present value of GMIB, in the event of annuitization, being higher than what accumulated policyholders’ account balances would support, taking into account the relationship between current annuity purchase rates and the GMIB guaranteed annuity purchase rates. The risk associated with products that have a GMxB feature and are accounted for as market risk benefits is that under-performance of the financial markets could result in the GMxB features benefits being higher than what accumulated policyholders’ account balances would support.

For GMxB features, the Company retains certain risks including basis, credit spread and some volatility risk and risk associated with actual experience versus expected actuarial assumptions for mortality, lapse and surrender, withdrawal and policyholder election rates, among other things. The derivative contracts are managed to correlate with changes in the value of the GMxB features that result from financial markets movements. A portion of exposure to realized equity volatility is hedged using equity options and variance swaps and a portion of exposure to credit risk is hedged using total return swaps on fixed income indices. Additionally, the Company is party to total return swaps for which the reference U.S. Treasury securities are contemporaneously purchased from the market and sold to the swap counterparty. As these transactions result in a transfer of control of the U.S. Treasury securities to the swap counterparty, the Company derecognizes these securities with consequent gain or loss from the sale. The Company has also purchased reinsurance contracts to mitigate the risks associated with GMDB features and the impact of potential market fluctuations on future policyholder elections of GMIB features contained in certain annuity contracts issued by the Company. The reinsurance of the GMIB features is accounted for as purchased market risk benefits. In addition, on June 1, 2021, we ceded legacy variable annuity policies sold by Equitable Financial between 2006-2008 (the “Block”), comprised of non-New York “Accumulator” policies containing fixed rate GMIB and/or GMDB guarantees to CS Life. As this contract provides full risk transfer and thus has the same risk attributes as the underlying direct contracts, the benefits of this treaty are accounted for in the same manner as the underlying gross reserves and therefore the Amounts Due from Reinsurers related to the GMIB with NLG are accounted for as purchased market risk benefits.

The Company has in place an economic hedge program using U.S. Treasury futures to partially protect the overall profitability of future variable annuity sales against declining interest rates.

Derivatives Utilized to Hedge Crediting Rate Exposure on SCS, SIO, MSO and IUL Products/Investment Options

The Company hedges crediting rates in the SCS variable annuity, SIO in the EQUI-VEST variable annuity series, MSO in the variable life insurance products and IUL insurance products. These products permit the contract owner to participate in the performance of an index, ETF or commodity price movement up to a cap for a set period of time. They also contain a protection feature, in which the Company will absorb, up to a certain percentage, the loss of value in an index, ETF or commodity price, which varies by product segment.

In order to support the returns associated with these features, the Company enters into derivative contracts whose payouts, in combination with fixed income investments, emulate those of the index, ETF or commodity price, subject to caps and buffers, thereby substantially reducing any exposure to market-related earnings volatility.

Derivatives Used to Hedge Equity Market Risks Associated with the General Account’s Seed Money Investments in Retail Mutual Funds

The Company’s General Account seed money investments in retail mutual funds expose us to market risk, including equity market risk which is partially hedged through equity-index futures contracts to minimize such risk.

Derivatives Used for General Account Investment Portfolio

The Company maintains a strategy in its General Account investment portfolio to replicate the credit exposure of fixed maturity securities otherwise permissible for investment under its investment guidelines through the sale of CDS. Under the terms of these swaps, the Company receives quarterly fixed premiums that, together with any initial amount paid or received at trade inception, replicate the credit spread otherwise currently obtainable by purchasing the referenced entity’s bonds of similar maturity. These credit derivatives generally have remaining terms of five years or less and are recorded at fair value with changes in fair value, including the yield component that emerges from initial amounts paid or received, reported in net derivative gains (losses).

The Company manages its credit exposure taking into consideration both cash and derivatives based positions and selects the reference entities in its replicated credit exposures in a manner consistent with its selection of fixed maturities. In addition, the Company generally transacts the sale of CDS in single name reference entities of investment grade credit quality and with counterparties subject to collateral posting requirements. If there is an event of default by the reference entity or other such credit event as defined under the terms of the swap contract, the Company is obligated to perform under the credit derivative and, at its option, either pay the referenced amount of the

32

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

contract less an auction-determined recovery amount or pay the referenced amount of the contract and receive in return the defaulted or similar security of the reference entity for recovery by sale at the contract settlement auction. The Company purchased CDS to mitigate its exposure to a reference entity through cash positions. These positions do not replicate credit spreads.

To date, there have been no events of default or circumstances indicative of a deterioration in the credit quality of the named referenced entities to require or suggest that the Company will have to perform under the CDS that it sold. The maximum potential amount of future payments the Company could be required to make under the credit derivatives sold is limited to the par value of the referenced securities which is the dollar or euro-equivalent of the derivative’s notional amount. The Standard North American CDS Contract or Standard European Corporate Contract under which the Company executes these CDS sales transactions does not contain recourse provisions for recovery of amounts paid under the credit derivative.

The Company purchased 30-year TIPS and other sovereign bonds, both inflation linked and non-inflation linked, as General Account investments and enters into asset or cross-currency basis swaps, to result in payment of the given bond’s coupons and principal at maturity in the bond’s specified currency to the swap counterparty in return for fixed dollar amounts. These swaps, when considered in combination with the bonds, together result in a net position that is intended to replicate a dollar-denominated fixed-coupon cash bond with a yield higher than a term-equivalent U.S. Treasury bond.

Derivatives Utilized to Hedge Exposure to Foreign Currency Denominated Cash Flows

The Company purchases private placement debt securities and issues funding agreements in the FABN program in currencies other than its functional U.S. dollar currency. The Company enters into cross currency swaps with external counterparties to hedge the exposure of the foreign currency denominated cash flows of these instruments. The foreign currency received from or paid to the cross currency swap counterparty is exchanged for fixed U.S. dollar amounts with improved net investment yields or net product costs over equivalent U.S. dollar denominated instruments issued at that time. The transactions are accounted for as cash flow hedges when they are designated in hedging relationships and qualify for hedge accounting.

These cross currency swaps are for the period the foreign currency denominated private placement debt securities and funding agreement are outstanding, with the longest cross currency swap expiring in 2033. Since these cross currency swaps are designated and qualify as cash flow hedges, the corresponding interest accruals are recognized in Net investment income and in Interest credited to policyholders’ account balances.

The tables below present quantitative disclosures about the Company’s derivative instruments designated in hedging relationships and derivative instruments which have not been designated in hedging relationships, including those embedded in other contracts required to be accounted for as derivative instruments.

The following table presents the gross notional amount and estimated fair value of the Company’s derivatives:

33

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Derivative Instruments by Category

	March 31, 2023						December 31, 2022
			Fair Value						Fair Value
	Notional Amount		Derivative Assets		Derivative Liabilities		Notional Amount		Derivative Assets		Derivative Liabilities
	(in millions)
Derivatives: designated for hedge accounting (1)
Cash flow hedges:
Currency swaps	$	1,580	$	98	$	87	$	1,431	$	99	$	85
Interest swaps	955		—		335		955		—		294
Total: designated for hedge accounting	2,535		98		422		2,386		99		379
Derivatives: not designated for hedge accounting (1)
Equity contracts:
Futures	5,515		—		5		5,151		2		—
Swaps	12,281		58		9		11,188		39		9
Options	51,196		8,814		2,955		40,122		7,583		3,412
Interest rate contracts:
Futures	12,191		—		—		12,693		—		—
Swaps	1,980		17		92		1,515		—		166
Credit contracts:
Credit default swaps	321		12		7		327		18		9
Currency contracts:
Currency swaps	548		4		10		397		4		13
Currency forwards	37		14		15		62		31		32
Other freestanding contracts:
Margin	—		242		—		—		226		—
Collateral	—		149		5,233		—		142		4,472
Total: not designated for hedge accounting	84,069		9,310		8,326		71,455		8,045		8,113
Embedded derivatives:
SCS, SIO, MSO and IUL indexed features (2)	—		—		6,063		—		—		4,164
Total embedded derivatives	—		—		6,063		—		—		4,164
Total derivative instruments	$	86,604	$	9,408	$	14,811	$	73,841	$	8,144	$	12,656

___________

(1)Reported in other invested assets in the consolidated balance sheets.

(2)Reported in policyholders’ account balances in the consolidated balance sheets.

The following table presents the effects of derivative instruments on the consolidated statements of income and comprehensive income (loss).

34

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Derivative Instruments by Category

	Three Months Ended March 31, 2023								Three Months Ended March 31, 2022
	Net Derivatives Gain (Losses) (1)		Net Investment Income		Interest Credited To Policyholders Account Balances		AOCI		Net Derivatives Gain (Losses) (1)		Net Investment Income		Interest Credited To Policyholders Account Balances		AOCI
	(in millions)
Derivatives: designated for hedge accounting
Cash flow hedges:
Currency swaps	$	7	$	3	$	(34)	$	25	$	(4)	$	—	$	(18)	$	13
Interest swaps	(4)		—		—		(28)		(14)		—		—		(20)
Total: designated for hedge accounting	3		3		(34)		(3)		(18)		—		(18)		(7)
Derivatives: not Designated for hedge accounting
Equity contracts:
Futures	(143)		—		—		—		58		—		—		—
Swaps	(605)		—		—		—		734		—		—		—
Options	1,501		—		—		—		(284)		—		—		—
Interest rate contracts:
Futures	(22)		—		—		—		(512)		—		—		—
Swaps	48		—		—		—		(149)		—		—		—
Credit contracts:
Credit default swaps	(2)		—		—		—		2		—		—		—
Currency contracts:
Currency swaps	(10)		—		—		—		5		—		—		—
Currency forwards	—		—		—		—		1		—		—		—
Other freestanding contracts:
Margin	—		—		—		—		—		—		—		—
Collateral	—		—		—		—		—		—		—		—
Total: not designated for hedge accounting	767		—		—		—		(145)		—		—		—
Embedded derivatives:
SCS, SIO,MSO and IUL indexed features	(1,611)		—		—		—		322		—		—		—
Total embedded derivatives	(1,611)		—		—		—		322		—		—		—
Total derivative instruments	$	(841)	$	3	$	(34)	$	(3)	$	159	$	—	$	(18)	$	(7)

______________

(1)Reported in net derivative gains (losses) in the consolidated statements of income (loss).

.

35

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The following table presents a roll-forward of cash flow hedges recognized in AOCI.

Roll-forward of Cash flow hedges in AOCI

	Three Months Ended March 31,
	2023		2022
	(in millions)
Balance, beginning of period	$	22	$	(208)
Amount recorded in AOCI
Currency swaps	(7)		(3)
Interest swaps	(37)		(39)
Total amount recorded in AOCI	(44)		(42)
Amount reclassified from AOCI to income
Currency swaps (1)	32		16
Interest swaps (1)	9		19
Total amount reclassified from AOCI to income	41		35
Balance, end of period (2)	$	19	$	(215)

_______________

(1)    Currency swaps reclassified from AOCI to income are reported in net investment income in the consolidated statements of income (loss). Interest swaps reclassified from AOCI to income are reported in net derivative gains (losses) in the consolidated statements of income (loss).

(2)    The Company does not estimate the amount of the deferred losses in AOCI at three months ended March 31, 2023 and 2022 which will be released and reclassified into Net income (loss) over the next 12 months as the amounts cannot be reasonably estimated.

Equity-Based and Treasury Futures Contracts Margin

All outstanding equity-based and treasury futures contracts as of March 31, 2023 and December 31, 2022 are exchange-traded and net settled daily in cash. As of March 31, 2023 and December 31, 2022, respectively, the Company had open exchange-traded futures positions on: (i) the S&P 500, Nasdaq, Russell 2000 and Emerging Market indices, having initial margin requirements of $258 million and $247 million, (ii) the 2-year, 5-year and 10-year U.S. Treasury Notes on U.S. Treasury bonds and ultra-long bonds, having initial margin requirements of $74 million and $113 million, and (iii) the Euro Stoxx, FTSE 100, Topix, ASX 200 and EAFE indices as well as corresponding currency futures on the Euro/U.S. dollar, Pound/U.S. dollar, Australian dollar/U.S. dollar, and Yen/U.S. dollar, having initial margin requirements of $16 million and $16 million.

Collateral Arrangements

The Company generally has executed a CSA under the ISDA Master Agreement it maintains with each of its OTC derivative counterparties that requires both posting and accepting collateral either in the form of cash or high-quality securities, such as U.S. Treasury securities, U.S. government and government agency securities and investment grade corporate bonds. The Company nets the fair value of all derivative financial instruments with counterparties for which an ISDA Master Agreement and related CSA have been executed. As of March 31, 2023 and December 31, 2022, respectively, the Company held $5.2 billion and $4.5 billion in cash and securities collateral delivered by trade counterparties, representing the fair value of the related derivative agreements. The unrestricted cash collateral is reported in other invested assets. The Company posted collateral of $149 million and $142 million as of March 31, 2023 and December 31, 2022, respectively, in the normal operation of its collateral arrangements. The Company is exposed to losses in the event of non-performance by counterparties to financial derivative transactions with a positive fair value. The Company manages credit risk by: (i) entering into derivative transactions with highly rated major international financial institutions and other creditworthy counterparties governed by master netting agreements, as applicable; (ii) trading through central clearing and OTC parties; (iii) obtaining collateral, such as cash and securities, when appropriate; and (iv) setting limits on single party credit exposures which are subject to periodic management review.

Substantially all of the Company’s derivative agreements have zero thresholds which require daily full collateralization by the party in a liability position. In addition, certain of the Company’s derivative agreements contain credit-risk related contingent features; if the credit rating of one of the parties to the derivative agreement is to fall below a certain level, the party with positive fair value could request termination at the then fair value or demand immediate full collateralization from the party whose credit rating fell and is in a net liability position.

36

As of March 31, 2023 and December 31, 2022, there were no net liability derivative positions with counterparties with credit risk-related contingent features whose credit rating has fallen. All derivatives have been appropriately collateralized by the Company or the counterparty in accordance with the terms of the derivative agreements.

The following tables presents information about the Company’s offsetting of financial assets and liabilities and derivative instruments as of March 31, 2023 and December 31, 2022:

Offsetting of Financial Assets and Liabilities and Derivative Instruments

As of March 31, 2023

	Gross Amount Recognized		Gross Amount Offset in the Balance Sheets		Net Amount Presented in the Balance Sheets		Gross Amount not Offset in the Balance Sheets (3)		Net Amount
	(in millions)
Assets:
Derivative assets (1)	$	9,408	$	7,783	$	1,625	$	(945)	$	680
Other financial assets	2,986		—		2,986		—		2,986
Other invested assets	$	12,394	$	7,783	$	4,611	$	(945)	$	3,666
Liabilities:
Derivative liabilities (2)	$	7,802	$	7,783	$	19	$	—	$	19
Other financial liabilities	6,277		—		6,277		—		6,277
Other liabilities	$	14,079	$	7,783	$	6,296	$	—	$	6,296

______________

(1)Excludes Investment Management and Research segment’s derivative assets of consolidated VIEs/VOEs.

(2)Excludes Investment Management and Research segment’s derivative liabilities of consolidated VIEs/VOEs.

(3)Financial instruments/Collateral sent (held).

As of December 31, 2022

	Gross Amount Recognized		Gross Amount Offset in the Balance Sheets		Net Amount Presented in the Balance Sheets		Gross Amount not Offset in the Balance Sheets (3)		Net Amount
	(in millions)
Assets:
Derivative assets (1)	$	8,143	$	7,047	$	1,096	$	(848)	$	248
Other financial assets	2,789		—		2,789		—		2,789
Other invested assets	$	10,932	$	7,047	$	3,885	$	(848)	$	3,037
Liabilities:
Derivative liabilities (2)	$	7,645	$	7,047	$	598	$	—	$	598
Other financial liabilities	6,510		—		6,510		—		6,510
Other liabilities	$	14,155	$	7,047	$	7,108	$	—	$	7,108

______________

(1)Excludes Investment Management and Research segment’s derivative assets of consolidated VIEs/VOEs.

(2)Excludes Investment Management and Research segment’s derivative liabilities of consolidated VIEs/VOEs.

(3)Financial instruments sent (held).

5)    CLOSED BLOCK

As a result of demutualization, the Company’s Closed Block was established in 1992 for the benefit of certain individual participating policies that were in force on that date. Assets, liabilities and earnings of the Closed Block are specifically identified to support its participating policyholders.

Assets allocated to the Closed Block inure solely to the benefit of the Closed Block policyholders and will not revert to the benefit of the Company. No reallocation, transfer, borrowing or lending of assets can be made between the Closed Block and other portions of the Company’s General Account, any of its Separate Accounts or any affiliate of the

37

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Company without the approval of the New York State Department of Financial Services (the “NYDFS”). Closed Block assets and liabilities are carried on the same basis as similar assets and liabilities held in the General Account. For more information on the Closed Block, see Note 6 to the Company’s consolidated financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2022.

Summarized financial information for the Company’s Closed Block is as follows:

	March 31, 2023		December 31, 2022
	(in millions)
Closed Block Liabilities:
Future policy benefits, policyholders’ account balances and other	$	5,626	$	5,692
Policyholder dividend obligation	—		—
Other liabilities	102		68
Total Closed Block liabilities	5,728		5,760
Assets Designated to the Closed Block:
Fixed maturities AFS, at fair value (amortized cost of $3,117 and $3,171) (allowance for credit losses of $0 and $0)	2,945		2,948
Mortgage loans on real estate (net of allowance for credit losses of $5 and $4)	1,647		1,645
Policy loans	561		569
Cash and other invested assets	2		—
Other assets	201		187
Total assets designated to the Closed Block	5,356		5,349
Excess of Closed Block liabilities over assets designated to the Closed Block	372		411
Amounts included in AOCI:
Net unrealized investment gains (losses), net of policyholders’ dividend obligation: $0 and $0; and net of income tax: $36 and $47	(136)		(177)
Maximum future earnings to be recognized from Closed Block assets and liabilities	$	236	$	234

The Company’s Closed Block revenues and expenses were as follows:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Revenues:
Premiums and other income	$	30	$	33
Net investment income (loss)	51		58
Investment gains (losses), net	—		1
Total revenues	81		92
Benefits and Other Deductions:
Policyholders’ benefits and dividends	83		76
Other operating costs and expenses	—		—
Total benefits and other deductions	83		76
Net income (loss), before income taxes	(2)		16
Income tax (expense) benefit	(1)		(2)
Net income (loss)	$	(3)	$	14

38

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

6)    DAC AND OTHER DEFERRED ASSETS/LIABILITIES

Changes in the DAC asset for the three months ended March 31, 2023 and 2022 were as follows:

	Protection Solutions								Individual Retirement								Legacy		Group Retirement				Corporate and Other		Total
	Term		UL		VUL		IUL		GMxB Core		EI		IE		SCS		GMxB Legacy		EG		Momentum		CB (1)
	(in millions)
Balance beginning of the period	$	362	$	179	$	889	$	185	$	1,625	$	156	$	148	$	1,279	$	593	$	710	$	89	$	127	$	6,342
Capitalization	4		1		35		3		19		3		11		101		6		16		3		—		202
Amortization	(10)		(3)		(14)		(3)		(35)		(3)		(3)		(47)		(16)		(10)		(5)		(3)		(152)
Balance, March 31, 2023	$	356	$	177	$	910	$	185	$	1,609	$	156	$	156	$	1,333	$	583	$	716	$	87	$	124	$	6,392

______________

(1)“CB” defined as Closed Block

	Protection Solutions								Individual Retirement								Legacy		Group Retirement				Corporate and Other		Total
	Term		UL		VUL		IUL		GMxB Core		EI		IE		SCS		GMxB Legacy		EG		Momentum		CB (1)
	(in millions)
Balance beginning of the period	$	385	$	180	$	799	$	180	$	1,653	$	156	$	121	$	1,070	$	631	$	677	$	94	$	138	$	6,084
Capitalization	4		3		36		4		31		3		10		88		8		18		4		—		209
Amortization (2)	(10)		(3)		(12)		(2)		(33)		(3)		(4)		(40)		(16)		(10)		(5)		(3)		(141)
Balance, March 31, 2022	$	379	$	180	$	823	$	182	$	1,651	$	156	$	127	$	1,118	$	623	$	685	$	93	$	135	$	6,152

______________

(1)“CB” defined as Closed Block.

(2)DAC amortization of $2 million related to Other not reflected in table above.

Changes in the Individual Retirement Sales Inducement Assets for the three months ended March 31, 2023 and 2022 were as follows:

	Three Months Ended March 31,
	2023				2022
	GMxB Core		GMxB Legacy		GMxB Core		GMxB Legacy
	(in millions)
Balance beginning of the period	$	137	$	200	$	147	$	222
Amortization	(3)		(5)		(3)		(6)
Balance, end of the period	$	134	$	195	$	144	$	216

39

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Changes in the Protection Solution Unearned Revenue Liability for the three months ended March 31, 2023 and 2022 were as follows:

	Three Months Ended March 31,
	2023						2022
	UL		VUL		IUL		UL		VUL		IUL
	(in millions)
Balance beginning of the period	$	95	$	684	$	157	$	80	$	619	$	94
Capitalization	5		27		17		5		25		18
Amortization	(2)		(10)		(3)		(1)		(10)		(2)
Balance, end of the period	$	98	$	701	$	171	$	84	$	634	$	110

The following table presents a reconciliation of DAC to the consolidated balance sheet as of March 31, 2023 and December 31, 2022.

	March 31, 2023		December 31, 2022
	(in millions)
Protection Solutions
Term	$	356	$	362
Universal Life	177		179
Variable Universal Life	910		889
Indexed Universal Life	185		185
Individual Retirement
GMxB Core	1,609		1,625
EQUI-VEST Individual	156		156
Investment Edge	156		148
SCS	1,333		1,279
Legacy Segment
GMxB Legacy	583		593
Group Retirement
EQUI-VEST Group	716		710
Momentum	87		89
Corporate and Other	124		127
Other	27		27
Total	$	6,419	$	6,369

Annually, or as circumstances warrant, we will review the associated decrements assumptions. (i.e. mortality and lapse) based on our multi-year average of companies experience with actuarial judgements to reflect other observable industry trends. In addition to DAC, the Unearned Revenue Liability and Sales Inducement Asset (“SIA”) use similar techniques and quarterly update processes for balance amortization.

7)    FAIR VALUE DISCLOSURES

U.S. GAAP establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value, and identifies three levels of inputs that may be used to measure fair value:

Level 1    Unadjusted quoted prices for identical instruments in active markets. Level 1 fair values generally are supported by market transactions that occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2    Observable inputs other than Level 1 prices, such as quoted prices for similar instruments, quoted prices in markets that are not active, and inputs to model-derived valuations that are directly observable or can be corroborated by observable market data.

40

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Level 3    Unobservable inputs supported by little or no market activity and often requiring significant management judgment or estimation, such as an entity’s own assumptions about the cash flows or other significant components of value that market participants would use in pricing the asset or liability.

The Company uses unadjusted quoted market prices to measure fair value for those instruments that are actively traded in financial markets. In cases where quoted market prices are not available, fair values are measured using present value or other valuation techniques. The fair value determinations are made at a specific point in time, based on available market information and judgments about the financial instrument, including estimates of the timing and amount of expected future cash flows and the credit standing of counterparties. Such adjustments do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument, nor do they consider the tax impact of the realization of unrealized gains or losses. In many cases, the fair value cannot be substantiated by direct comparison to independent markets, nor can the disclosed value be realized in immediate settlement of the instrument.

Management is responsible for the determination of the value of investments carried at fair value and the supporting methodologies and assumptions. Under the terms of various service agreements, the Company often utilizes independent valuation service providers to gather, analyze, and interpret market information and derive fair values based upon relevant methodologies and assumptions for individual securities. These independent valuation service providers typically obtain data about market transactions and other key valuation model inputs from multiple sources and, through the use of widely accepted valuation models, provide a single fair value measurement for individual securities for which a fair value has been requested. As further described below with respect to specific asset classes, these inputs include, but are not limited to, market prices for recent trades and transactions in comparable securities, benchmark yields, interest rate yield curves, credit spreads, quoted prices for similar securities, and other market-observable information, as applicable. Specific attributes of the security being valued also are considered, including its term, interest rate, credit rating, industry sector, and when applicable, collateral quality and other security- or issuer-specific information. When insufficient market observable information is available upon which to measure fair value, the Company either will request brokers knowledgeable about these securities to provide a non-binding quote or will employ internal valuation models. Fair values received from independent valuation service providers and brokers and those internally modeled or otherwise estimated are assessed for reasonableness.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Fair value measurements are required on a non-recurring basis for certain assets only when an impairment or other events occur. For the period ended March 31, 2023, the Company recognized impairment adjustments and impairment losses, respectively, to adjust the carrying value of held-for-sale asset and liabilities to their fair value less cost to sell. The value is measured on a nonrecurring basis and categorized within Level 3 of the fair value hierarchy. The fair value was determined using a market approach, estimated based on the negotiated value of the asset and liabilities. See Note 20 of the Notes to these Consolidated Financial Statements for additional details of the Held-for-Sale assets and liabilities. As of December 31, 2022, no assets or liabilities were required to be measured at fair value on a non-recurring basis.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis are summarized below.

41

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Fair Value Measurements as of March 31, 2023

	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:
Investments
Fixed maturities, AFS:
Corporate (1)	$	—	$	43,143	$	1,950	$	45,093
U.S. Treasury, government and agency	—		6,069		—		6,069
States and political subdivisions	—		547		28		575
Foreign governments	—		898		—		898
Residential mortgage-backed (2)	—		847		—		847
Asset-backed (3)	—		8,230		12		8,242
Commercial mortgage-backed	—		3,264		34		3,298
Redeemable preferred stock	—		43		—		43
Total fixed maturities, AFS	—		63,041		2,024		65,065
Fixed maturities, at fair value using the fair value option	—		1,347		196		1,543
Other equity investments (6)	210		486		11		707
Trading securities	296		477		55		828
Other invested assets:
Short-term investments	—		1,170		—		1,170
Assets of consolidated VIEs/VOEs	144		403		4		551
Swaps	—		(355)		—		(355)
Credit default swaps	—		5		—		5
Futures	(5)		—		—		(5)
Options	—		5,859		—		5,859
Total other invested assets	139		7,082		4		7,225
Cash equivalents	3,462		272		—		3,734
Segregated securities	—		1,055		—		1,055
Purchased market risk benefits	—		—		10,676		10,676
Assets for market risk benefits	—		—		629		629
Separate Accounts assets (4)	116,581		2,557		1		119,139
Total Assets	$	120,688	$	76,317	$	13,596	$	210,601
Liabilities:
Notes issued by consolidated VIE’s, at fair value using the fair value option (5)	$	—	$	1,383	$	—	$	1,383
SCS, SIO, MSO and IUL indexed features’ liability	—		6,063		—		6,063
Liabilities of consolidated VIEs and VOEs	15		1		—		16
Liabilities for market risk benefits	—		—		15,061		15,061
Contingent payment arrangements	—		—		248		248
Total Liabilities	$	15	$	7,447	$	15,309	$	22,771

______________

(1)Corporate fixed maturities includes both public and private issues.

(2)Includes publicly traded agency pass-through securities and collateralized obligations.

(3)Includes credit-tranched securities collateralized by sub-prime mortgages, credit risk transfer securities and other asset types.

(4)Separate Accounts assets included in the fair value hierarchy exclude investments in entities that calculate NAV per share (or its equivalent) as a practical expedient. Such investments excluded from the fair value hierarchy include investments in real estate. As of March 31, 2023, the fair value of such investments was $425 million.

42

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

(5)Includes CLO short-term debt of $231 million, which is inclusive as fair valued within Notes issued by consolidated VIE’s, at fair value using the fair value option. Accrued interest payable of $17 million is reported in Notes issued by consolidated VIE’s, at fair value using the fair value option in the consolidated balance sheets, which is not required to be measured at fair value on a recurring basis.

(6)Includes short position equity securities of $17 million that are reported in other liabilities.

Fair Value Measurements as of December 31, 2022

	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:
Investments
Fixed maturities, AFS:
Corporate (1)	$	—	$	41,450	$	2,121	$	43,571
U.S. Treasury, government and agency	—		5,837		—		5,837
States and political subdivisions	—		499		28		527
Foreign governments	—		836		—		836
Residential mortgage-backed (2)	—		788		34		822
Asset-backed (3)	—		8,490		—		8,490
Commercial mortgage-backed (2)	—		3,203		32		3,235
Redeemable preferred stock	—		43		—		43
Total fixed maturities, AFS	—		61,146		2,215		63,361
Fixed maturities, at fair value using the fair value option			1,284		224		1,508
Other equity investments (6)	214		497		12		723
Trading securities	290		332		55		677
Other invested assets:
Short-term investments	—		943		—		943
Assets of consolidated VIEs/VOEs	131		393		5		529
Swaps	—		(425)		—		(425)
Credit default swaps	—		9		—		9
Futures	2		—		—		2
Options	—		4,171		—		4,171
Total other invested assets	133		5,091		5		5,229
Cash equivalents	2,386		501		—		2,887
Segregated securities	—		1,522		—		1,522
Purchased market risk benefits	—		—		10,423		10,423
Assets for market risk benefits	—		—		490		490
Separate Accounts assets (4)	111,744		2,436		1		114,181
Total Assets	$	114,767	$	72,809	$	13,425	$	201,001
Liabilities:
Notes issued by consolidated VIE’s, at fair value using the fair value option (5)	$	—	$	1,374	$	—	$	1,374
SCS, SIO, MSO and IUL indexed features’ liability	—		4,164		—		4,164
Liabilities of consolidated VIEs and VOEs	15		7		—		22
Liabilities for market risk benefits	—		—		15,766		15,766
Contingent payment arrangements	—		—		247		247
Total Liabilities	$	15	$	5,545	$	16,013	$	21,573

______________

(1)Corporate fixed maturities includes both public and private issues.

(2)Includes publicly traded agency pass-through securities and collateralized obligations.

(3)Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans.

43

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

(4)Separate Accounts assets included in the fair value hierarchy exclude investments in entities that calculate NAV per share (or its equivalent) as a practical expedient. Such investments excluded from the fair value hierarchy include investments in real estate and commercial mortgages. As of December 31, 2022, the fair value of such investments was $456 million.

(5)Includes CLO short-term debt of $239 million, which is inclusive as fair valued within Notes issued by consolidated VIE’s, at fair value using the fair value option Accrued interest payable of $15 million is reported in Notes issued by consolidated VIE’s, at fair value using the fair value option in the consolidated balance sheets, which is not required to be measured at fair value on a recurring basis.

(6)Includes short position equity securities of $12 million that are reported in other liabilities.

Public Fixed Maturities

The fair values of the Company’s public fixed maturities, including those accounted for using the fair value option are generally based on prices obtained from independent valuation service providers and for which the Company maintains a vendor hierarchy by asset type based on historical pricing experience and vendor expertise. Although each security generally is priced by multiple independent valuation service providers, the Company ultimately uses the price received from the independent valuation service provider highest in the vendor hierarchy based on the respective asset type, with limited exception. To validate reasonableness, prices also are internally reviewed by those with relevant expertise through comparison with directly observed recent market trades. Consistent with the fair value hierarchy, public fixed maturities validated in this manner generally are reflected within Level 2, as they are primarily based on observable pricing for similar assets and/or other market observable inputs.

Private Fixed Maturities

The fair values of the Company’s private fixed maturities, including those accounted for using the fair value option are determined from prices obtained from independent valuation service providers. Prices not obtained from an independent valuation service provider are determined by using a discounted cash flow model or a market comparable company valuation technique. In certain cases, these models use observable inputs with a discount rate based upon the average of spread surveys collected from private market intermediaries who are active in both primary and secondary transactions, taking into account, among other factors, the credit quality and industry sector of the issuer and the reduced liquidity associated with private placements. Generally, these securities have been reflected within Level 2. For certain private fixed maturities, the discounted cash flow model or a market comparable company valuation technique may also incorporate unobservable inputs, which reflect the Company’s own assumptions about the inputs market participants would use in pricing the asset. To the extent management determines that such unobservable inputs are significant to the fair value measurement of a security, a Level 3 classification generally is made.

Notes issued by consolidated VIE’s, at fair value using the fair value option

These notes are based on the fair values of corresponding fixed maturity collateral. The CLO liabilities are also reduced by the fair value of the beneficial interests the Company retains in the CLO and the carrying value of any beneficial interests that represent compensation for services. As the notes are valued based on the reference collateral, they are classified as Level 2 or 3.

Freestanding Derivative Positions

The net fair value of the Company’s freestanding derivative positions as disclosed in Note 4 of the Notes to these Consolidated Financial Statements are generally based on prices obtained either from independent valuation service providers or derived by applying market inputs from recognized vendors into industry standard pricing models. The majority of these derivative contracts are traded in the OTC derivative market and are classified in Level 2. The fair values of derivative assets and liabilities traded in the OTC market are determined using quantitative models that require use of the contractual terms of the derivative instruments and multiple market inputs, including interest rates, prices, and indices to generate continuous yield or pricing curves, including overnight index swap curves, and volatility factors, which then are applied to value the positions. The predominance of market inputs is actively quoted and can be validated through external sources or reliably interpolated if less observable.

Level Classifications of the Company’s Financial Instruments

Financial Instruments Classified as Level 1

Investments classified as Level 1 primarily include redeemable preferred stock, trading securities, cash equivalents and Separate Accounts assets. Fair value measurements classified as Level 1 include exchange-traded prices of fixed maturities, equity securities and derivative contracts, and net asset values for transacting subscriptions and redemptions of mutual fund shares held by Separate Accounts. Cash equivalents classified as Level 1 include money market

44

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

accounts, overnight commercial paper and highly liquid debt instruments purchased with an original maturity of three months or less and are carried at cost as a proxy for fair value measurement due to their short-term nature.

Financial Instruments Classified as Level 2

Investments classified as Level 2 are measured at fair value on a recurring basis and primarily include U.S. government and agency securities, certain corporate debt securities and financial assets and liabilities accounted for using the fair value option, such as public and private fixed maturities. As market quotes generally are not readily available or accessible for these securities, their fair value measures are determined utilizing relevant information generated by market transactions involving comparable securities and often are based on model pricing techniques that effectively discount prospective cash flows to present value using appropriate sector-adjusted credit spreads commensurate with the security’s duration, also taking into consideration issuer-specific credit quality and liquidity. Segregated securities classified as Level 2 are U.S. Treasury bills segregated by AB in a special reserve bank custody account for the exclusive benefit of brokerage customers, as required by Rule 15c3-3 of the Exchange Act and for which fair values are based on quoted yields in secondary markets.

Observable inputs generally used to measure the fair value of securities classified as Level 2 include benchmark yields, reported secondary trades, issuer spreads, benchmark securities and other reference data. Additional observable inputs are used when available, and as may be appropriate, for certain security types, such as prepayment, default, and collateral information for the purpose of measuring the fair value of mortgage- and asset-backed securities. The Company’s AAA-rated mortgage- and asset-backed securities are classified as Level 2 for which the observability of market inputs to their pricing models is supported by sufficient, albeit more recently contracted, market activity in these sectors.

Certain Company products, such as the SCS, EQUI-VEST variable annuity products, IUL and the MSO fund available in some life contracts, offer investment options which permit the contract owner to participate in the performance of an index, ETF or commodity price. These investment options, which depending on the product and on the index selected, can currently have one, three, five or six year terms, provide for participation in the performance of specified indices, ETF or commodity price movement up to a segment-specific declared maximum rate. Under certain conditions that vary by product, e.g., holding these segments for the full term, these segments also shield policyholders from some or all negative investment performance associated with these indices, ETF or commodity prices. These investment options have defined formulaic liability amounts, and the current values of the option component of these segment reserves are classified as Level 2 embedded derivatives. The fair values of these embedded derivatives are based on data obtained from independent valuation service providers.

Financial Instruments Classified as Level 3

The Company’s investments classified as Level 3 primarily include corporate debt securities and financial assets and liabilities accounted for using the fair value option, such as private fixed maturities and asset-backed securities. Determinations to classify fair value measures within Level 3 of the valuation hierarchy generally are based upon the significance of the unobservable factors to the overall fair value measurement. Included in the Level 3 classification are fixed maturities with indicative pricing obtained from brokers that otherwise could not be corroborated to market observable data.

The Company has certain variable annuity contracts with GMDB, GMIB, GIB and GWBL and other features in-force that guarantee one of the following:

•Return of Premium: the benefit is the greater of current account value or premiums paid (adjusted for withdrawals);

•Ratchet: the benefit is the greatest of current account value, premiums paid (adjusted for withdrawals), or the highest account value on any anniversary up to contractually specified ages (adjusted for withdrawals);

•Roll-Up: the benefit is the greater of current account value or premiums paid (adjusted for withdrawals) accumulated at contractually specified interest rates up to specified ages;

•Combo: the benefit is the greater of the ratchet benefit or the roll-up benefit, which may include either a five year or an annual reset; or

•Withdrawal: the withdrawal is guaranteed up to a maximum amount per year for life.

45

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The GMIBNLG feature allows the policyholder to receive guaranteed minimum lifetime annuity payments based on predetermined annuity purchase rates applied to the contract’s benefit base if and when the contract account value is depleted and the NLG feature is activated. The optional GMIB feature allows the policyholder to receive guaranteed minimum lifetime annuity payments based on predetermined annuity purchase rates.

The GMWB feature allows the policyholder to withdraw at minimum, over the life of the contract, an amount based on the contract’s benefit base. The GWBL feature allows the policyholder to withdraw, each year for the life of the contract, a specified annual percentage of an amount based on the contract’s benefit base. The GMAB feature increases the contract account value at the end of a specified period to a GMAB base. The GIB feature provides a lifetime annuity based on predetermined annuity purchase rates if and when the contract account value is depleted. This lifetime annuity is based on predetermined annuity purchase rates applied to a GIB base. The GMDB feature guarantees that the benefit paid upon death will not be less than a guaranteed benefit base. If the contract’s account value is less than the benefit base at the time a death claim is paid, the amount payable will be equal to the benefit base.

These are accounted for as market risk benefits carried at fair value and are also considered Level 3 for fair value leveling.

Purchased MRB assets, which are accounted for as market risk benefits carried at fair value are also considered Level 3 for fair value leveling. The Purchased MRB asset fair value reflects the present value of reinsurance premiums, net of recoveries, adjusted for risk margins and nonperformance risk over a range of market consistent economic scenarios while the MRB asset and liability reflects the present value of expected future payments (benefits) less fees, adjusted for risk margins and nonperformance risk, attributable to the MRB liability over a range of market-consistent economic scenarios.

The valuations of the Market Risk Benefits and Purchased MRB assets incorporate significant non-observable assumptions related to policyholder behavior, risk margins and projections of equity Separate Account funds. The credit risks of the counterparty and of the Company are considered in determining the fair values of its Market Risk Benefits and Purchased MRB asset after taking into account the effects of collateral arrangements. Incremental adjustment to the risk free curve for counterparty non-performance risk is made to the fair values of the Purchased MRB assets. Risk margins were applied to the non-capital markets inputs to the Market Risk Benefits and Purchased MRB valuations.

After giving consideration to collateral arrangements, the Company reduced the fair value of its Purchased MRB asset by $1.2 billion and $1.1 billion as of March 31, 2023 and December 31, 2022, respectively, to recognize incremental counterparty non-performance risk.

The Company’s Level 3 liabilities include contingent payment arrangements associated with acquisitions in 2020 and 2022 by AB. At each reporting date, AB estimates the fair values of the contingent consideration expected to be paid based upon revenue and discount rate projections, using unobservable market data inputs, which are included in Level 3 of the valuation hierarchy. The Company’s consolidated VIEs/VOEs hold investments that are classified as Level 3, primarily corporate bonds that are vendor priced with no ratings available, bank loans, non-agency collateralized mortgage obligations and asset-backed securities.

Transfers of Financial Instruments Between Levels 2 and 3

During the three months ended March 31, 2023, fixed maturities with fair values of $401 million were transferred out of Level 3 and into Level 2 principally due to the availability of trading activity and/or market observable inputs to measure and validate their fair values. In addition, fixed maturities with fair value of $56 million were transferred from Level 2 into the Level 3 classification. These transfers in the aggregate represent approximately 8.4% of total equity as of March 31, 2023.

During the three months ended March 31, 2022, fixed maturities with fair values of $110 million were transferred out of Level 3 and into Level 2 principally due to the availability of trading activity and/or market observable inputs to measure and validate their fair values. In addition, fixed maturities with fair value of $258 million were transferred from Level 2 into the Level 3 classification. These transfers in the aggregate represent approximately 3.9% of total equity as of March 31, 2022.

The tables below present reconciliations for all Level 3 assets and liabilities and changes in unrealized gains (losses) for the three months ended March 31, 2023 and 2022, respectively. Not included below are the changes in balances

46

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

related to market risk benefits and purchased market risk level 3 assets and liabilities, which are included in Note 9 of the Notes to these Consolidated Financial Statements.

	Corporate		State and Political Subdivisions		Asset-backed		CMBS		RMBS		Trading Securities, at Fair Value		Fixed maturities, at FVO
	(in millions)
Balance, January 1, 2023	$	2,121	$	28	$	—	$	32	$	34	$	55	$	224
Total gains and (losses), realized and unrealized, included in:
Net income (loss) as:
Net investment income (loss)	2		—		—		—		—		—		3
Investment gains (losses), net	(3)		—		—		—		—		—		—
Subtotal	(1)		—		—		—		—		—		3
Other comprehensive income (loss)	18		—		—		—		—		—		—
Purchases	171		—		12		2		—		—		12
Sales	(91)		—		—		—		—		—		—
Activity related to consolidated VIEs/VOEs	—		—		—		—		—		—		—
Transfers into Level 3 (1)	—		—		—		—		—		—		56
Transfers out of Level 3 (1)	(268)		—		—		—		(34)		—		(99)
Balance, March 31, 2023	$	1,950	$	28	$	12	$	34	$	—	$	55	$	196
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—	$	—	$	—	$	3
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	17	$	—	$	—	$	—	$	—	$	—	$	—
Balance, January 1, 2022	$	1,504	$	35	$	8	$	20	$	—	$	65	$	201
Total gains and (losses), realized and unrealized, included in:
Net income (loss) as:
Net investment income (loss)	1		—		—		—		—		—		(4)
Investment gains (losses), net	1		—		—		—		—		(13)		—
Subtotal	2		—		—		—		—		(13)		(4)
Other comprehensive income (loss)	(31)		(2)		—		(1)		—		—		—
Purchases	232		—		325		219		—		—		89
Sales	(87)		(1)		(1)		—		—		—		(29)
Activity related to consolidated VIEs/VOEs	—		—		—		—		—		—		—
Transfers into Level 3 (1)	70		—		—		—		—		—		188
Transfers out of Level 3 (1)	(7)		—		—		—		—		—		(103)
Balance, March 31, 2022	$	1,683	$	32	$	332	$	238	$	—	$	52	$	342
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	—	$	—	$	—	$	—	$	—	$	(13)	$	(4)
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	(29)	$	(2)	$	—	$	(1)	$	—	$	—	$	—

_____________

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values.

(2)For instruments held as of March 31, 2023 and March 31, 2022, amounts are included in net investment income or net derivative gains (losses) in the consolidated statements of income (loss) or unrealized gains (losses) on investments in the consolidated statements of comprehensive income.

47

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	Other Equity Investments (3)		Separate Accounts Assets		Contingent Payment Arrangement
	(in millions)
Balance, January 1, 2023	$	17	$	1	$	(247)
Realized and unrealized gains (losses), included in Net income (loss) as:
Investment gains (losses), reported in net investment income	(3)		—		—
Net derivative gains (losses)	—		—		—
Total realized and unrealized gains (losses)	(3)		—		—
Other comprehensive income (loss)	—		—		—
Purchases	—		—
Sales	—		—		—
Settlements	—		—		—
Other	—		—		(1)
Activity related to consolidated VIEs/VOEs	—		—		—
Transfers into Level 3 (1)	1		—		—
Transfers out of Level 3 (1)	—		—		—
Balance, March 31, 2023	$	15	$	1	$	(248)
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	(3)	$	—	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	—	$	—	$	—
Balance, January 1, 2022	$	16	$	1	$	(38)
Realized and unrealized gains (losses), included in Net income (loss) as:
Investment gains (losses), reported in net investment income	—		—		—
Net derivative gains (losses)	—		—		—
Total realized and unrealized gains (losses)	—		—		—
Other comprehensive income (loss)	—		—		—
Purchases	—		—		1
Sales	—		(1)		—
Other	—		—		—
Activity related to consolidated VIEs/VOEs	(2)		—		—
Transfers into Level 3 (1)	—		—		—
Transfers out of Level 3 (1)	(3)		—		—
Balance, March 31, 2022	$	11	$	—	$	(37)
Change in unrealized gains or losses for the period included in earnings for instruments held at the end of the reporting period (2)	$	—	$	—	$	—
Change in unrealized gains or losses for the period included in other comprehensive income for instruments held at the end of the reporting period (2)	$	—	$	—	$	—

_____________

(1)Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair

48

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

(2)For instruments held as of March 31, 2023 and March 31, 2022, amounts are included in net investment income or net derivative gains (losses) in the consolidated statements of income (loss) or unrealized gains (losses) on investments in the consolidated statements of comprehensive income.

(3)Other Equity Investments include other invested assets.

Quantitative and Qualitative Information about Level 3 Fair Value Measurements

The following tables disclose quantitative information about Level 3 fair value measurements by category for assets and liabilities as of March 31, 2023 and December 31, 2022, respectively.

Quantitative Information about Level 3 Fair Value Measurements as of March 31, 2023

	Fair Value		Valuation Technique	Significant Unobservable Input	Range	Weighted Average (2)
	(in millions)
Assets:
Investments:
Fixed maturities, AFS:
Corporate	$	475	Matrix pricing model	Spread over Benchmark	20 bps - 270 bps	175 bps
	1,001		Market comparable  companies	EBITDA multiples Discount rate Cash flow multiples Loan to value	5.3x - 31.5x 8.3% - 24.8% 0.5x - 11.0x 0.0% - 68.7%	14.7x 10.0% 6.8x 0.9%
Trading Securities, at Fair Value	55		Discounted Cash Flow	Earnings multiple Discount factor Discount years	8.3x 10.0% 7
Other equity investments	2		Discounted Cash Flow	Earnings Multiple	7.0x - 11.0x	9.2x
Purchased MRB asset (1) (2) (4)	10,676		Discounted cash flow	Lapse rates Withdrawal rates GMIB Utilization rates Non-performance risk Volatility rates - Equity Mortality: Ages 0-40 Ages 41-60 Ages 61-115	0.26%-26.23% 0.06%-10.93% 0.04%-66.66% 65 bps - 149 bps 17%-26% 0.01%-0.17% 0.06%-0.52% 0.32%-40.00%	1.52% 0.70% 7.42% 69 bps 22% 2.85% (same for all ages) (same for all ages)
Liabilities:
AB Contingent Consideration Payable	$	248	Discounted cash flow	Expected revenue growth rates Discount rate	2.0% - 83.9% 1.9% - 10.4%	10.3% 4.6%
Direct MRB (1) (2) (3) (4)	14,432		Discounted cash flow	Non-performance risk Lapse rates Withdrawal rates Annuitization rates Mortality: Ages 0-40 Ages 41-60 Ages 61-115	191 bps 0.26%-35.42% 0.00%-10.93% 0.04%-100.00% 0.01%-0.17% 0.06%-0.52% 0.32%-40.00%	191 bps 2.77% 0.62% 4.99% 2.18% (same for all ages) (same for all ages)

______________

(1)Mortality rates vary by age and demographic characteristic such as gender. Mortality rate assumptions are based on a combination of company and industry experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuating the embedded derivatives.

(2)Lapses and pro-rata withdrawal rates were developed as a function of the policy account value. Dollar for dollar withdrawal rates were developed as a function of the dollar for dollar threshold, the dollar for dollar limit. Utilization rates were developed as a function of the benefit base.

(3)MRB liabilities are shown net of MRB assets. Net amount is made up of $15.1 billion of MRB liabilities and $629 million of MRB assets.

(4)Includes Legacy and Core products.

Quantitative Information about Level 3 Fair Value Measurements as of December 31, 2022

49

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	Fair Value		Valuation Technique	Significant Unobservable Input	Range	Weighted Average (2)
	(in millions)
Assets:
Investments:
Fixed maturities, AFS:
Corporate	$	417	Matrix pricing model	Spread over benchmark	20 bps - 797 bps	205 bps
	1,029		Market comparable companies	EBITDA multiples  Discount rate  Cash flow multiples Loan to value	5.3x - 35.8x 9.0% - 45.7% 0.0x-10.3x 0.0%-40.4%	13.6x 11.9% 6.1x 12.0%
Trading Securities, at Fair Value	55		Discounted cash flow	Earnings multiple Discounts factor Discount years	8.3x 10.00% 7
Other equity investments	4		Market comparable companies	Revenue multiple	0.5x - 10.8x	2.4x
Purchased MRB asset (1) (2) (4)	10,423		Discounted cash flow	Lapse rates Withdrawal rates GMIB Utilization rates Non-performance risk Volatility rates - Equity Mortality: Ages 0-40 Ages 41-60 Ages 61-115	0.26% - 26.23% 0.06% - 10.93% 0.04% - 66.66% 54 bps - 124 bps 14% - 32% 0.01% - 0.17% 0.06% - 0.52% 0.32% - 40.00%	1.58% 0.69% 7.39% 69 bps 24% 2.87% (same for all ages) (same for all ages)
Liabilities:
AB Contingent Consideration Payable	$	247	Discounted cash flow	Expected revenue growth rates Discount rate	2.0% - 83.9% 1.9% - 10.4%	11.5% 4.5%
Direct MRB (1) (2) (3) (4)	15,276		Discounted cash flow	Non-performance risk Lapse rates Withdrawal rates Annuitization rates Mortality: Ages 0-40 Ages 41-60 Ages 61-115	157 bps 0.26% - 35.42% 0.00% - 10.93% 0.04% - 100.00% 0.01% - 0.17% 0.06% - 0.52% 0.32% - 40.00%	157 bps 3.01% 0.68% 5.53% 2.43% (same for all ages) (same for all ages)

______________

(1)Mortality rates vary by age and demographic characteristic such as gender and benefits elected with the policy. Mortality rate assumptions are based on a combination of company and industry experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuating the embedded derivatives.

(2)Lapses and pro-rata withdrawal rates were developed as a function of the policy account value. Dollar for dollar withdrawal rates were developed as a function of the dollar for dollar threshold, the dollar for dollar limit. Utilization rates were developed as a function of the benefit base.

(3)MRB liabilities are shown net of MRB assets. Net amount is made up of $15.8 billion of MRB liabilities and $490 million of MRB assets.

(4)Includes Legacy and Core products.

50

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Level 3 Financial Instruments for which Quantitative Inputs are Not Available

Certain Privately Placed Debt Securities with Limited Trading Activity

Excluded from the tables above as of March 31, 2023 and December 31, 2022, respectively, are approximately $758 million and $1.0 billion of Level 3 fair value measurements of investments for which the underlying quantitative inputs are not developed by the Company and are not readily available. These investments primarily consist of certain privately placed debt securities with limited trading activity, including residential mortgage- and asset-backed instruments, and their fair values generally reflect unadjusted prices obtained from independent valuation service providers and indicative, non-binding quotes obtained from third-party broker-dealers recognized as market participants. Significant increases or decreases in the fair value amounts received from these pricing sources may result in the Company’s reporting significantly higher or lower fair value measurements for these Level 3 investments.

•The fair value of private placement securities is determined by application of a matrix pricing model or a market comparable company value technique. The significant unobservable input to the matrix pricing model valuation technique is the spread over the industry-specific benchmark yield curve. Generally, an increase or decrease in spreads would lead to directionally inverse movement in the fair value measurements of these securities. The significant unobservable input to the market comparable company valuation technique is the discount rate. Generally, a significant increase (decrease) in the discount rate would result in significantly lower (higher) fair value measurements of these securities.

•Residential mortgage-backed securities classified as Level 3 primarily consist of non-agency paper with low trading activity. Included in the tables above as of March 31, 2023 and December 31, 2022, there were no Level 3 securities that were determined by application of a matrix pricing model and for which the spread over the U.S. Treasury curve is the most significant unobservable input to the pricing result. Generally, a change in spreads would lead to directionally inverse movement in the fair value measurements of these securities.

•Asset-backed securities classified as Level 3 primarily consist of non-agency mortgage loan trust certificates, including subprime and Alt-A paper, credit risk transfer securities, and equipment financings. Included in the tables above as of March 31, 2023 and December 31, 2022, there were no securities that were determined by the application of matrix-pricing for which the spread over the U.S. Treasury curve is the most significant unobservable input to the pricing result. Significant increases (decreases) in spreads would have resulted in significantly lower (higher) fair value measurements.

Other Equity Investments

Included in other equity investments classified as Level 3 are venture capital securities in the Technology, Media and Telecommunications industries. The fair value measurements of these securities include significant unobservable inputs including an enterprise value to revenue multiples and a discount rate to account for liquidity and various risk factors. Significant increases (decreases) in the enterprise value to revenue multiple inputs in isolation would have resulted in a significantly higher (lower) fair value measurement. Significant increases (decreases) in the discount rate would have resulted in a significantly lower (higher) fair value measurement.

Market Risk Benefits

Significant unobservable inputs with respect to the fair value measurement of the Purchased MRB assets and the MRB liabilities identified in the table above are developed using Company data. Future Policyholder behavior is an unobservable market assumption and as such all aspects of policyholder behavior are derived based on recent historical experience. These policyholder behaviors include lapses, pro-rata withdrawals, dollar for dollar withdrawals, GMIB utilization, deferred mortality and payout phase mortality. Many of these policyholder behaviors have dynamic adjustment factors based on the relative value of the rider as compared to the account value in different economic environments. This applies to all variable annuity related products; products with GMxB riders including but not limited to GMIB, GMDB, and GWL.

Lapse rates are adjusted at the contract level based on a comparison of the value of the embedded GMxB rider and the current policyholder account value, which include other factors such as considering surrender charges. Generally, lapse rates are assumed to be lower in periods when a surrender charge applies. A dynamic lapse function reduces the base lapse rate when the guaranteed amount is greater than the account value as in-the-money contracts are less likely to lapse. For valuing Purchased MRB assets and MRB liabilities, lapse rates vary throughout the period over which cash flows are projected.

51

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Carrying Value of Financial Instruments Not Otherwise Disclosed in Note 3 and Note 4 of the Notes to these Consolidated Financial Statements

The carrying values and fair values as of March 31, 2023 and December 31, 2022 for financial instruments not otherwise disclosed in Note 3 and Note 4 of the Notes to these Consolidated Financial Statements are presented in the table below.

Carrying Values and Fair Values for Financial Instruments Not Otherwise Disclosed

	Carrying Value		Fair Value
			Level 1		Level 2		Level 3		Total
	(in millions)
March 31, 2023:
Mortgage loans on real estate	$	16,969	$	—	$	—	$	15,268	$	15,268
Policy loans	$	4,028	$	—	$	—	$	4,400	$	4,400
Policyholders’ liabilities: Investment contracts	$	1,844	$	—	$	—	$	1,708	$	1,708
FHLB funding agreements	$	8,369	$	—	$	8,285	$	—	$	8,285
FABN funding agreements	$	7,367	$	—	$	6,850	$	—	$	6,850
Short-term debt (1)	$	520	$	—	$	520	$	—	$	520
Long-term debt	$	3,819	$	—	$	3,605	$	—	$	3,605
Separate Accounts liabilities	$	10,669	$	—	$	—	$	10,669	$	10,669
December 31, 2022:
Mortgage loans on real estate	$	16,481	$	—	$	—	$	14,690	$	14,690
Policy loans	$	4,033	$	—	$	—	$	4,349	$	4,349
Policyholders’ liabilities: Investment contracts	$	1,916	$	—	$	—	$	1,750	$	1,750
FHLB funding agreements	$	8,505	$	—	$	8,390	$	—	$	8,390
FABN funding agreements	$	7,095	$	—	$	6,384	$	—	$	6,384
Short-term debt (1)	$	520	$	—	$	518	$	—	$	518
Long-term debt	$	3,322	$	—	$	3,130	$	—	$	3,130
Separate Accounts liabilities	$	10,236	$	—	$	—	$	10,236	$	10,236

_____________

(1)As of March 31, 2023 and December 31, 2022, excludes CLO short-term debt of $231 million and $239 million, which is inclusive as fair valued within Notes issued by consolidated VIE’s, at fair value using the fair value option.

Mortgage Loans on Real Estate

Fair values for commercial and agricultural mortgage loans on real estate are measured by discounting future contractual cash flows to be received on the mortgage loan using interest rates at which loans with similar characteristics and credit quality would be made. The discount rate is derived based on the appropriate U.S. Treasury rate with a like term to the remaining term of the loan to which a spread reflective of the risk premium associated with the specific loan is added. Fair values for mortgage loans anticipated to be foreclosed and problem mortgage loans are limited to the fair value of the underlying collateral, if lower.

Policy Loans

The fair value of policy loans is calculated by discounting expected cash flows based upon the U.S. Treasury yield curve and historical loan repayment patterns.

Short-term Debt

The Company’s short-term debt primarily includes long-term debt that has been reclassified to short-term due to an upcoming maturity date within one year. The fair values for the Company’s short-term debt are determined by Bloomberg’s evaluated pricing service, which uses direct observations or observed comparables.

52

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Long-term Debt

The fair values for the Company’s long-term debt are determined by Bloomberg’s evaluated pricing service, which uses direct observations or observed comparables.

FHLB Funding Agreements

The fair values of Equitable Financial’s FHLB long term funding agreements’ fair values are determined based on indicative market rates published by FHLB, provided to AB and modeled for each note’s FMV. FHLB Short-term funding agreements’ fair values are reflective of notional/par value plus accrued interest.

FABN Funding Agreements

The fair values of Equitable Financial’s FABN funding agreements are determined by Bloomberg’s evaluated pricing service, which uses direct observations or observed comparables.

Policyholder Liabilities - Investment Contracts and Separate Accounts Liabilities

The fair values for deferred annuities and certain annuities, which are included in Policyholders’ account balances, and liabilities for investment contracts with fund investments in Separate Accounts, are estimated using projected cash flows discounted at rates reflecting current market rates. Significant unobservable inputs reflected in the cash flows include lapse rates and withdrawal rates. Incremental adjustments may be made to the fair value to reflect non-performance risk. Certain other products such as the Company’s association plans contracts, supplementary contracts not involving life contingencies, Access Accounts and Escrow Shield Plus product reserves are held at book value.

Financial Instruments Exempt from Fair Value Disclosure or Otherwise Not Required to be Disclosed

Exempt from Fair Value Disclosure Requirements

Certain financial instruments are exempt from the requirements for fair value disclosure, such as insurance liabilities other than financial guarantees and investment contracts, limited partnerships accounted for under the equity method and pension and other postretirement obligations.

Otherwise Not Required to be Included in the Table Above

The Company’s investment in COLI policies are recorded at their cash surrender value and are therefore not required to be included in the table above.

8)    LIABILITIES FOR FUTURE POLICYHOLDER BENEFITS

The following table summarizes balances and changes in the liability for future policy benefits for nonparticipating traditional and limited pay contracts for the three months ended March 31, 2023 and 2022.

53

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	Three Months Ended March 31, 2023										Three Months Ended March 31, 2022
	Protection Solutions		Individual Retirement		GMxB Legacy		Corporate & Other				Protection Solutions		Individual Retirement		GMxB Legacy		Corporate & Other
	Term		Payout		Payout		Group Pension		Health		Term		Payout		Payout		Group Pension		Health
	(in millions)
Present Value of Expected Net Premiums
Balance, beginning of the period	$	2,100	$	—	$	—	$	—	$	(5)	$	2,485	$	—	$	—	$	—	$	22
Beginning balance at original discount rate	2,078		—		—		—		(5)		1,864		—		—		—		19
Effect of changes in cash flow assumptions	8		—		—		—		—		—		—		—		—		—
Effect of actual variances from expected experience	3		—		—		—		(6)		56		—		—		—		(18)
Adjusted beginning of the period balance	2,089		—		—		—		(11)		1,920		—		—		—		1
Issuances	15		—		—		—		—		22		—		—		—		—
Interest accrual	25		—		—		—		—		23		—		—		—		—
Net premiums collected	(51)		—		—		—		1		(49)		—		—		—		—
Ending Balance at original discount rate	2,078		—		—		—		(10)		1,916		—		—		—		1
Effect of changes in discount rate assumptions	82		—		—		—		—		387		—		—		—		1
Balance, end of the period	$	2,160	$	—	$	—	$	—	$	(10)	$	2,303	$	—	$	—	$	—	$	2

	Three Months Ended March 31, 2023										Three Months Ended March 31, 2022
	Protection Solutions		Individual Retirement		GMxB Legacy		Corporate & Other				Protection Solutions		Individual Retirement		GMxB Legacy		Corporate & Other
	Term		Payout		Payout		Group Pension		Health		Term		Payout		Payout		Group Pension		Health
	(Dollars in millions)
Present Value of Expected Future Policy Benefits
Balance, beginning of the period	$	3,465	$	828	$	2,689	$	523	$	1,553	$	4,294	$	1,114	$	2,547	$	683	$	2,092
Beginning balance of original discount rate	3,391		845		3,024		583		1,795		3,241		883		2,400		632		1,915
Effect of changes in cash flow assumptions	9		—		—		—		—		—		—		—		—		—
Effect of actual variances from expected experience	4		1		—		(1)		(7)		60		—		(4)		—		(20)
Adjusted beginning of the period balance	3,404		846		3,024		582		1,788		3,301		883		2,396		632		1,895
Issuances	16		15		222		—		—		23		9		152		—		—
Interest accrual	42		10		21		5		15		42		10		16		5		15
Benefits payments	(95)		(23)		(65)		(17)		(33)		(137)		(24)		(47)		(18)		(41)
Ending Balance at original discount rate	3,367		848		3,202		570		1,770		3,229		878		2,517		619		1,869
Effect of changes in discount rate assumptions	164		6		(258)		(48)		(197)		650		126		(58)		2		(5)
Balance, end of the period	$	3,531	$	854	$	2,944	$	522	$	1,573	$	3,879	$	1,004	$	2,459	$	621	$	1,864
Net liability for future policy benefits	$	1,371	$	854	$	2,944	$	522	$	1,583	$	1,576	$	1,004	$	2,459	$	621	$	1,862
Less: Reinsurance recoverable	27		—		(589)		—		(1,258)		16		—		(203)		—		(1,479)

54

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Net liability for future policy benefits, after reinsurance recoverable	$	1,398	$	854	$	2,355	$	522	$	325	$	1,592	$	1,004	$	2,256	$	621	$	383
Weighted-average duration of liability for future policyholder benefits (years)	7.0		9.4		7.9		7.1		8.7		7.5		9.6		8.4		7.2		8.9

The following table reconciles the net liability for future policy benefits and liability of death benefits to the liability for future policy benefits in the consolidated balance sheet as of March 31, 2023 and December 31, 2022.

	March 31, 2023		December 31, 2022
	(in millions)
Reconciliation
Term	$	1,371	$	1,365
Individual Retirement - Payout	853		828
Legacy - Payout	2,944		2,689
Group Pension - Benefit Reserve & DPL	523		523
Health	1,583		1,558
Universal Life - additional liability for death benefits	1,133		1,109
Subtotal	8,407		8,072
Whole Life Closed Block and Open Block products	5,597		5,664
Other (1)	904		908
Future policyholder benefits total	14,908		14,644
Other policyholder funds and dividends payable	1,830		1,959
Total	$	16,738	$	16,603

_____________

(1)Primarily consists of Future policy benefits related to Protective Life and Annuity, Assumed Life and DI, GRP Life Run off, VISL rider and Employee Benefits.

The following table provides the amount of undiscounted and discounted expected gross premiums and expected future benefits and expenses related to nonparticipating traditional and limited payment contracts as of March 31, 2023 and December 31, 2022:

	March 31, 2023		December 31, 2022
	(in millions)
Term
Expected future benefit payments and expenses (undiscounted)	$	5,972	$	6,022
Expected future gross premiums (undiscounted)	7,188		7,273
Expected future benefit payments and expenses (discounted; AOCI basis)	3,531		3,465
Expected future gross premiums (discounted; AOCI basis)	3,981		3,904
Payout - Legacy
Expected future benefit payments and expenses (undiscounted)	4,227		3,947
Expected future gross premiums (undiscounted)	—		—
Expected future benefit payments and expenses (discounted; AOCI basis)	2,861		2,607
Expected future gross premiums (discounted; AOCI basis)	—		—
Payout
Expected future benefit payments and expenses (undiscounted)	1,456		1,460
Expected future gross premiums (undiscounted)	—		—
Expected future benefit payments and expenses (discounted; AOCI basis)	825		801
Expected future gross premiums (discounted; AOCI basis)	—		—

55

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	March 31, 2023		December 31, 2022
	(in millions)
Group Pension
Expected future benefit payments and expenses (undiscounted)	713		730
Expected future gross premiums (undiscounted)	—		—
Expected future benefit payments and expenses (discounted; AOCI basis)	550		563
Expected future gross premiums (discounted; AOCI basis)	—		—
Health
Expected future benefit payments and expenses (undiscounted)	2,469		2,510
Expected future gross premiums (undiscounted)	94		99
Expected future benefit payments and expenses (discounted; AOCI basis)	1,553		1,533
Expected future gross premiums (discounted; AOCI basis)	$	75	$	78

The tables below summarizes the revenue and interest related to nonparticipating traditional and limited payment contracts for the three months ended March 31, 2023 and 2022:

	March 31, 2023		March 31, 2022		March 31, 2023		March 31, 2022
	Gross Premium				Interest Accretion
	(in millions)
Revenue and Interest Accretion
Term	$	70	$	71	$	17	$	18
Payout - Legacy	27		21		21		16
Payout	15		9		10		11
Group Pension	—		—		5		5
Health	2		2		15		15
Total	$	114	$	103	$	68	$	65

The following table provides the weighted average interest rates for the liability for future policy benefits as of March 31, 2023 and December 31, 2022:

	March 31, 2023		December 31, 2022
Weighted Average Interest Rate
Term Life
Interest accretion rate	5.6	%	5.7	%
Current discount rate	4.7	%	5.1	%
Payout - Legacy
Interest accretion rate	3.6	%	3.4	%
Current discount rate	4.8	%	5.0	%
Payout
Interest accretion rate	4.9	%	4.9	%
Current discount rate	4.9	%	5.2	%
Group Pension
Interest accretion rate	3.4	%	3.4	%
Current discount rate	4.7	%	5.1	%
Health
Interest accretion rate	3.3	%	3.3	%
Current discount rate	4.9	%	5.2	%

56

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

The following table provides the balance, changes in and the weighted average durations of the additional insurance liabilities for the three months ended March 31, 2023 and 2022:

	March 31, 2023		March 31, 2022
	Protection Solutions
	Universal Life		Universal Life
	(Dollars in millions)
Balance, beginning of the period	$	1,109	$	1,087
Beginning balance before AOCI adjustments	1,135		1,076
Effect of changes in interest rate & cash flow assumptions and model changes	—		5
Effect of actual variances from expected experience	6		5
Adjusted beginning of the period balance	1,141		1,086
Interest accrual	13		12
Net assessments collected	18		21
Benefit payments	(18)		(29)
Ending balance before shadow reserve adjustments	1,154		1,090
Effect of reserve adjustment recorded in AOCI	(21)		(2)
Balance, end of the period	$	1,133	$	1,088
Net liability for additional liability	$	1,133	$	1,088
Less: Reinsurance recoverable	—		—
Net liability for additional liability, after reinsurance recoverable	$	1,133	$	1,088
Weighted-average duration of additional liability - death benefit (years)	21.6		22.9

The following tables provides the revenue, interest and weighted average interest rates, related to the additional insurance liabilities for the three months ended and as of March 31, 2023 and 2022.

		Three Months Ended March 31,
		2023		2022		2023		2022
		Assessments				Interest Accretion
	(in millions)
Revenue and Interest Accretion
Universal Life		$	172	$	180	$	13	$	12
Total		$	172	$	180	$	13	$	12

	March 31,
	2023		2022
Weighted Average Interest Rate
Universal Life	4.5	%	4.5	%
Interest accretion rate	4.5	%	4.5	%

The discount rate used for additional insurance liabilities reserve is based on the crediting rate at issue.

9)    MARKET RISK BENEFITS

The following table presents the balances and changes to the balances for the market risk benefits for the GMxB benefits on deferred variable annuities for the three months ended and as of March 31, 2023 and 2022.

57

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	March 31, 2023								March 31, 2022
	Individual Retirement		Legacy						Individual Retirement		Legacy
	GMxB Core		GMxB Legacy		Purchased MRB (3)		Net Legacy		GMxB Core		GMxB Legacy		Purchased MRB (3)		Net Legacy
	(in millions)
Balance, beginning of the period (“BOP”)	$	530	$	14,699	$	(10,415)	$	4,284	$	1,061	$	20,236	$	(14,059)	$	6,177
Balance BOP before changes in the instrument specific credit risk	529		15,314		(10,358)		4,956		666		19,719		(14,051)		5,668
Model changes and effect of changes in cash flow assumptions	—		—		—		—		—		(87)		29		(58)
Actual market movement effect	(211)		(744)		387		(357)		328		1,098		(399)		699
Interest accrual	18		197		(153)		44		5		104		(61)		43
Attributed fees accrued (1)	95		209		(83)		126		92		219		(86)		133
Benefit payments	(12)		(342)		185		(157)		(5)		(251)		136		(115)
Actual policyholder behavior different from expected behavior	7		21		(18)		3		1		33		(15)		18
Changes in future economic assumptions	125		944		(530)		414		(542)		(2,934)		2,006		(928)
Issuances	(1)		—		—		—		(5)		—		—		—
Balance EOP before changes in the instrument-specific credit risk	$	550	$	15,599	$	(10,570)	$	5,029	$	540	$	17,901	$	(12,441)	$	5,460
Changes in the instrument-specific credit risk (2)	(233)		(1,517)		(99)		(1,616)		(42)		(970)		(66)		(1,036)
Balance, end of the period (“EOP”)	$	317	$	14,082	$	(10,669)	$	3,413	$	498	$	16,931	$	(12,507)	$	4,424
Weighted-average age of policyholders (years)	63.7		72.8		67.7		N/A		62.8		72.2		67.1		N/A
Net amount at risk	$	3,287	$	21,472	$	10,045	N/A		$	1,787	$	17,987	$	7,657	N/A

_____________

(1)Attributed fees accrued represents the portion of the fees needed to fund future GMxB claims.

(2)Changes are recorded in OCI.

(3)Purchased MRB is the impact of non-affiliated reinsurance.

The following table reconciles market risk benefits by the amounts in an asset position and amounts in a liability position to the market risk amounts in the consolidated balance sheet as of March 31, 2023 and December 31, 2022.

	March 31, 2023										December 31, 2022
	Direct Asset		Direct Liability		Net Direct MRB		Purchased MRB		Total		Direct Asset		Direct Liability		Net Direct MRB		Purchased MRB		Total
	(in millions)
Legacy Segment
GMxB Legacy	$	(74)	$	14,156	$	14,082	$	(10,669)	$	3,413	$	(51)	$	14,749	$	14,699	$	(10,412)	$	4,287
Individual Retirement
GMxB Core	(498)		815		317		—		317		(387)		917		530		—		530
Other (1)	(57)		90		33		(7)		26		(52)		100		47		(11)		36
Total	$	(629)	$	15,061	$	14,432	$	(10,676)	$	3,756	$	(490)	$	15,766	$	15,276	$	(10,423)	$	4,853

______________

(1)Other primarily includes Individual EQUI-VEST MRB.

58

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

10)     POLICYHOLDER ACCOUNT BALANCES

The following table summarizes the balances and changes in policyholders’ account balances three months ended and as of March 31, 2023 and 2022:

	Protection Solutions				Legacy		Individual Retirement						Group Retirement
	Universal Life		Variable Universal Life		GMxB Legacy		GMxB Core		SCS (1)		EQUI-VEST Individual		EQUI-VEST Group		Momentum
March 31, 2023	(in millions)
Balance, beginning of the period	$	5,340	$	4,909	$	688	$	69	$	35,702	$	2,652	$	12,045	$	702
Issuances	—		—		—		—		—		—		—		—
Premiums received	184		38		20		46		—		11		148		19
Policy charges	(194)		(65)		19		(4)		(1)		—		(1)		—
Surrenders and withdrawals	(18)		(1)		(25)		(8)		(607)		(94)		(405)		(30)
Benefit payments	(76)		(40)		(24)		(1)		(59)		(20)		(17)		(2)
Net transfers from (to) separate account	—		(45)		—		(49)		1,982		3		69		(9)
Interest credited (2)	55		55		7		2		1,620		19		102		3
Other	—		—		—		—		—		3		11		—
Balance, end of the period	$	5,291	$	4,851	$	685	$	55	$	38,637	$	2,574	$	11,952	$	683
Weighted-average crediting rate	3.64%		3.81%		1.78%		1.05%		1.12%		3.09%		2.99%		2.03%
Net amount at risk (3)	$	37,031	$	114,419	$	21,472	$	3,287	$	43	$	128	$	58	$	—
Cash surrender value	$	3,475	$	3,293	$	957	$	284	$	35,286	$	2,567	$	11,871	$	684

______________

(1)SCS sales are recorded as a Separate Account liability until they are swept into the General Account. This sweep is recorded as Net Transfers from (to) separate account.

(2)SCS and EQUI-VEST Group includes amounts related to the change in embedded derivative.

(3)For life insurance products the net amount at risk is death benefit less account value for the policyholder. For variable annuity products the net amount risk is the maximum GMxB NAR for the policyholder.

March 31, 2022	Protection Solutions				Legacy		Individual Retirement						Group Retirement
	Universal Life		Variable Universal Life		GMxB Legacy		GMxB Core		SCS (1)		EQUI-VEST Individual		EQUI-VEST Group		Momentum
	(in millions)
Balance, beginning of the period	$	5,462	$	4,807	$	745	$	112	$	33,443	$	2,784	$	11,951	$	704
Issuances	—		—		—		—		—		—		—		—
Premiums received	191		47		16		40		—		15		149		23
Policy charges	(200)		(55)		13		(10)		—		—		(1)		—
Surrenders and withdrawals	(20)		—		(16)		(8)		(714)		(45)		(195)		(36)
Benefit payments	(53)		(3)		(27)		(1)		(59)		(15)		(19)		(1)
Net transfers from (to) separate account	—		12		4		(38)		1,717		10		109		23
Interest credited (2)	56		43		7		2		(272)		20		66		3
Other	—		—		—		—		—		—		—		—
Balance, end of the period	$	5,436	$	4,851	$	742	$	97	$	34,115	$	2,769	$	12,060	$	716
Weighted-average crediting rate	3.62%		3.83%		1.81%		1.05%		1.14%		2.86%		2.36%		2.04%
Net amount at risk (3)	$	39,254	$	112,430	$	17,987	$	1,787	$	10	$	104	$	19	$	—
Cash surrender value	$	3,521	$	3,403	$	1,031	$	309	$	31,608	$	2,761	$	11,982	$	716

______________

59

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

(1)SCS sales are recorded as a Separate Account liability until they are swept into the General Account. This sweep is recorded as Net Transfers from (to) separate account

(2)SCS and EQUI-VEST includes amounts related to the change in embedded derivative.

(3)For life insurance products the net amount at risk is death benefit less account value for the policyholder. For variable annuity products the net amount risk is the maximum GMxB NAR for the policyholder

The following table reconciles the policyholders account balances to the policyholders’ account balance liability in the consolidated balance sheet as of March 31, 2023 and December 31, 2022.

	March 31, 2023		December 31, 2022
	(in millions)
Policyholders’ account balance reconciliation
Protection Solution
Universal Life	$	5,291	$	5,340
Variable Universal Life	4,851		4,909
Legacy Segment
GMxB Legacy	685		688
Individual Retirement
GMxB Core	55		69
EQUI-VEST Individual	2,574		2,652
SCS	38,637		35,702
Group Retirement
EQUI-VEST Group	11,952		12,045
Momentum	683		702
Other (1)	6,235		6,122
Balance (exclusive of Funding Agreements)	70,963		68,229
Funding Agreements	15,798		15,637
Balance, end of the period	$	86,761	$	83,866

_____________

(1)Primarily reflects products, IR Payout, IR Other, Indexed Universal Life, Investment Edge, Group Pension, Closed Block and Corporate and Other other.

The following table presents the account values by range of guaranteed minimum crediting rates and the related range of the difference in basis points, between rates being credited policyholders and the respective guaranteed minimums as of March 31, 2023 and December 31, 2022.

March 31, 2023
Product (1)	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point - 50 Basis Points Above		51 Basis Points - 150 Basis Points Above		Greater Than 150 Basis Points Above		Total
( in millions)
Protection Solutions
Universal Life	0.00% - 1.50%	$	—	$	—	$	4	$	1	$	5
	1.51% - 2.50%	155		127		640		112		1,034
	Greater than 2.50%	3,565		650		—		—		4,215
	Total	$	3,720	$	777	$	644	$	113	$	5,254
Variable Universal Life	0.00% - 1.50%	$	23	$	51	$	11	$	2	$	87
	1.51% - 2.50%	384		156		—		—		540
	Greater than 2.50%	3,819		—		2		—		3,821
	Total	$	4,226	$	207	$	13	$	2	$	4,448
Legacy Segment

60

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

March 31, 2023
Product (1)	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point - 50 Basis Points Above		51 Basis Points - 150 Basis Points Above		Greater Than 150 Basis Points Above		Total
( in millions)
GMxB Legacy	0.00% - 1.50%	$	387	$	—	$	—	$	—	$	387
	1.51% - 2.50%	539		—		—		—		539
	Greater than 2.50%	33		—		—		—		33
	Total	$	959	$	—	$	—	$	—	$	959
Individual Retirement
GMxB Core	0.00% - 1.50%	$	279	$	—	$	—	$	—	$	279
	1.51% - 2.50%	14		—		—		—		14
	Greater than 2.50%	—		—		—		—		—
	Total	$	293	$	—	$	—	$	—	$	293
EQUI-VEST Individual	0.00% - 1.50%	$	35	$	—	$	55	$	239	$	329
	1.51% - 2.50%	—		—		46		—		46
	Greater than 2.50%	2,121		19		59		—		2,199
	Total	$	2,156	$	19	$	160	$	239	$	2,574
SCS	0.00% - 1.50%	$	31,090	$	—	$	—	$	—	$	31,090
	1.51% - 2.50%	5,821		—		—		—		5,821
	Greater than 2.50%	—		—		—		—		—
	Total	$	36,911	$	—	$	—	$	—	$	36,911
Group Retirement
EQUI-VEST Group	0.00% - 1.50%	$	58	$	57	$	362	$	3,176	$	3,653
	1.51% - 2.50%	11		2		897		—		910
	Greater than 2.50%	6,799		342		—		—		7,141
	Total	$	6,868	$	401	$	1,259	$	3,176	$	11,704
Momentum	0.00% - 1.50%	$	13	$	291	$	119	$	7	$	430
	1.51% - 2.50%	174		1		—		—		175
	Greater than 2.50%	73		—		5		—		78
	Total	$	260	$	292	$	124	$	7	$	683

61

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

December 31, 2022
Product (1)	Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 Basis Point - 50 Basis Points Above		51 Basis Points - 150 Basis Points Above		Greater Than 150 Basis Points Above		Total
( in millions)
Protection Solutions
Universal Life	0.00% - 1.50%	$	—	$	—	$	5	$	1	$	6
	1.51% - 2.50%	181		197		605		47		1,030
	Greater than 2.50%	3,615		657		—		—		4,272
	Total	$	3,796	$	854	$	610	$	48	$	5,308
Variable Universal Life	0.00% - 1.50%	$	30	$	40	$	7	$	1	$	78
	1.51% - 2.50%	485		53		—		—		538
	Greater than 2.50%	3,900		—		2		—		3,902
	Total	$	4,415	$	93	$	9	$	1	$	4,518
Legacy Segment
GMxB Legacy	0.00% - 1.50%	$	386	$	—	$	—	$	—	$	386
	1.51% - 2.50%	560		—		—		—		560
	Greater than 2.50%	35		—		—		—		35
	Total	$	981	$	—	$	—	$	—	$	981
Individual Retirement
GMxB Core	0.00% - 1.50%	$	289	$	—	$	—	$	—	$	289
	1.51% - 2.50%	14		—		—		—		14
	Greater than 2.50%	—		—		—		—		—
	Total	$	303	$	—	$	—	$	—	$	303
EQUI-VEST Individual	0.00% - 1.50%	$	345	$	—	$	—	$	—	$	345
	1.51% - 2.50%	46		—		—		—		46
	Greater than 2.50%	2,199		—		62		—		2,261
	Total	$	2,590	$	—	$	62	$	—	$	2,652
SCS	0.00% - 1.50%	$	28,086	$	—	$	—	$	—	$	28,086
	1.51% - 2.50%	5,527		—		—		—		5,527
	Greater than 2.50%	—		—		—		—		—
	Total	$	33,613	$	—	$	—	$	—	$	33,613
Group Retirement
EQUI-VEST Group	0.00% - 1.50%	$	109	$	5	$	366	$	3,112	$	3,592
	1.51% - 2.50%	11		2		889		—		902
	Greater than 2.50%	6,949		21		330		—		7,300
	Total	$	7,069	$	28	$	1,585	$	3,112	$	11,794
Momentum	0.00% - 1.50%	$	15	$	301	$	122	$	7	$	445
	1.51% - 2.50%	178		1		—		—		179
	Greater than 2.50%	73		—		5		—		78
	Total	$	266	$	302	$	127	$	7	$	702

Separate Account - Summary

The following table presents the balances of and changes in separate account liabilities three months ended and as of March 31, 2023 and 2022.

62

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	Protection Solutions		Legacy		Individual Retirement						Group Retirement
	VUL		GMxB Legacy		GMxB Core		EQUI-VEST Individual		Investment Edge		EQUI-VEST Group		Momentum
March 31, 2023	(in millions)
Balance, beginning of the period	$	13,187	$	32,616	$	27,772	$	4,161	$	3,798	$	22,393	$	3,885
Premiums and deposits	287		65		256		26		253		531		178
Policy charges	(137)		(178)		(115)		(1)		—		(4)		(5)
Surrenders and withdrawals	(117)		(660)		(559)		(100)		(95)		(359)		(157)
Benefit payments	(24)		(192)		(56)		(14)		(12)		(15)		(3)
Investment performance (1)	843		1,808		1,202		269		175		1,438		235
Net transfers from (to) general account	45		—		49		(3)		(140)		(69)		9
Other charges (2)	—		—		—		4		—		25		—
Balance, end of the period	$	14,084	$	33,459	$	28,549	$	4,342	$	3,979	$	23,940	$	4,142
Cash surrender value	$	13,755	$	33,181	$	27,680	$	4,310	$	3,885	$	23,702	$	4,136

_____________

(1)Investment performance is reflected net of M&E fees.

(2)EQUI-VEST Individual and EQUI-VEST Group for the three months ending March 31, 2023, amounts reflect a total special payment applied to the accounts of active clients as part of a previously disclosed settlement agreement between Equitable Financial Life Insurance Company and the Securities & Exchange Commission.

	Protection Solutions		Legacy		Individual Retirement						Group Retirement
	VUL		GMxB Legacy		GMxB Core		EQUI-VEST Individual		Investment Edge		EQUI-VEST Group		Momentum
March 31, 2022	(in millions)
Balance, beginning of the period	$	16,405	$	44,912	$	35,288	$	5,583	$	4,287	$	27,509	$	4,975
Premiums and deposits	283		55		441		42		241		523		185
Policy charges	(139)		(183)		(114)		—		—		(4)		(5)
Surrenders and withdrawals	(114)		(771)		(690)		(88)		(68)		(356)		(210)
Benefit payments	(54)		(186)		(70)		(16)		(11)		(20)		(1)
Investment performance (1)	(1,032)		(2,932)		(2,197)		(380)		(257)		(1,874)		(326)
Net transfers from (to) general account	(12)		(4)		38		(10)		(39)		(109)		(23)
Balance, end of the period	$	15,337	$	40,891	$	32,696	$	5,131	$	4,153	$	25,669	$	4,595
Cash surrender value	$	15,022	$	40,601	$	31,748	$	5,096	$	4,061	$	25,426	$	4,588

(1) Investment performance is reflected net of M&E fees.

______________

The following table reconciles the separate account liabilities to the separate account liability balance in the consolidated balance sheet as of March 31, 2023 and December 31, 2022.

63

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	March 31, 2023		December 31, 2022
	(in millions)
Separate Account Reconciliation
Protection Solution
Variable Universal Life	$	14,084	$	13,187
Legacy Segment
GMxB Legacy	33,459		32,616
Individual Retirement
GMxB Core	28,549		27,772
EQUI-VEST Individual	4,342		4,161
Investment Edge	3,979		3,798
Group Retirement
EQUI-VEST Group	23,940		22,393
Momentum	4,142		3,885
Other (1)	7,257		7,041
Total	$	119,752	$	114,853

______________

(1)Primarily reflects Corporate and Other products and Group Retirement products including Association and Group Retirement Other.

The following table presents the aggregate fair value of separate account assets by major asset category as of March 31, 2023 and December 31, 2022:

	March 31, 2023
	Protection Solutions		Individual Retirement		Group Retirement		Corp & Other		Legacy Segment		Total
	(in millions)
Asset Type
Debt securities	$	63	$	1	$	16	$	10	$	—	$	90
Common Stock	51		33		457		1,712		—		2,253
Mutual Funds	14,400		38,109		29,428		755		33,468		116,160
Bonds and Notes	114		3		1		1,131		—		1,249
Total	$	14,628	$	38,146	$	29,902	$	3,608	$	33,468	$	119,752

	December 31, 2022
	Protection Solutions		Individual Retirement		Group Retirement		Corp & Other		Legacy Segment		Total
	(in millions)
Asset Type
Debt securities	$	58	$	1	$	17	$	8	$	—	$	84
Common Stock	41		32		430		1,686		—		2,189
Mutual Funds	13,498		36,860		27,639		773		32,625		111,395
Bonds and Notes	119		3		1		1,062		—		1,185
Total	$	13,716	$	36,896	$	28,087	$	3,529	$	32,625	$	114,853

11)    EMPLOYEE BENEFIT PLANS

Pension Plans

Holdings and Equitable Financial Retirement Plans

Holdings sponsors the MONY Life Retirement Income Security Plan for Employees and Equitable Financial sponsors the Equitable Retirement Plan (the “Equitable Financial QP”), both of which are frozen qualified defined benefit plans covering eligible employees and financial professionals. These pension plans are non-contributory, and their benefits are generally based on a cash balance formula and/or, for certain participants, years of service and average earnings over a specified period. Holdings and Equitable Financial also sponsor certain nonqualified defined benefit plans, including the Equitable Excess Retirement Plan, that provide retirement benefits in excess of the amount permitted

64

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

under the tax law for the qualified plans. Holdings has assumed primary liability for both plans. Equitable Financial remains secondarily liable for its obligations under the Equitable Financial QP and would recognize such liability in the event Holdings does not perform.

AB Retirement Plans

AB maintains a qualified, non-contributory, defined benefit retirement plan covering current and former employees who were employed by AB in the United States prior to October 2, 2000 (the “AB Plan”). Benefits under the AB Plan are based on years of credited service, average final base salary, and primary Social Security benefits. Service and compensation after December 31, 2008 are not taken into account in determining participants’ retirement benefits.

Net Periodic Pension Expense

Components of net periodic pension expense for the Company’s plans were as follows:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Service cost	$	2	$	2
Interest cost	31		14
Expected return on assets	(39)		(39)
Prior period service cost amortization	(1)		(1)
Actuarial (gain) loss	—		—
Net amortization	9		20
Impact of settlement	—		—
Net Periodic Pension Expense	$	2	$	(4)

12)    INCOME TAXES

Income tax expense for the three months ended March 31, 2023 and 2022 was computed using an estimated annual effective tax rate (“ETR”), with discrete items recognized in the period in which they occur. The estimated ETR is revised, as necessary, at the end of successive interim reporting periods.

During the fourth quarter of 2022, the Company established a valuation allowance of $1.6 billion against its deferred tax asset related to unrealized capital losses in the available for sale securities portfolio. For the three months ended March 31, 2023, the Company recorded a decrease to the valuation allowance of $341 million due to a decrease in the portfolio’s unrealized capital loss. This adjustment was recorded in other comprehensive income.

As of each reporting date, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. During the three months ended March 31, 2023 the Company has taken steps to increase its available future liquidity by increasing borrowing capacity and amending certain counterparty agreements. While management has several actions that are pending, the Company now has the ability and intent to hold the underlying securities in its available for sale portfolio to recovery to the extent that half of the deferred tax asset would be realized. Based on all available evidence, as of March 31, 2023, the Company concluded that half of the deferred tax asset related to unrealized tax capital losses is more-likely-than-not to be realized and a full valuation allowance is not necessary. A valuation allowance of $614 million remains against the portion of the deferred tax asset that is still not more-likely-than-not to be realized. The partial release of the valuation allowance of $614 million was recorded in net income.

The Company uses the aggregate portfolio approach related to the stranded or disproportionate income tax effects in accumulated other comprehensive income related to available for sale securities. Under this approach, the disproportionate tax effect remains intact as long as the investment portfolio remains.

13)    EQUITY

Preferred Stock

Preferred stock authorized, issued and outstanding was as follows:

65

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	March 31, 2023			December 31, 2022
Series	Shares Authorized	Shares  Issued	Shares Outstanding	Shares Authorized	Shares  Issued	Shares Outstanding
Series A	32,000	32,000	32,000	32,000	32,000	32,000
Series B	20,000	20,000	20,000	20,000	20,000	20,000
Series C	12,000	12,000	12,000	12,000	12,000	12,000
Total	64,000	64,000	64,000	64,000	64,000	64,000

Dividends declared per share were as follows for the periods indicated:

	Three Months Ended March 31,
	2023		2022
Series A dividends declared	$	328	$	328
Series B dividends declared	$	—	$	—
Series C dividends declared	$	269	$	269

Common Stock

Dividends declared per share of common stock were as follows for the periods indicated:

	Three Months Ended March 31,
	2023		2022
Dividends declared	$	0.20	$	0.18

Share Repurchase

On February 9, 2022, the Company’s Board of Directors authorized a new $1.2 billion share repurchase program. Under this program, the Company may, from time to time purchase shares of its common stock through various means. The Company may choose to suspend or discontinue the repurchase program at any time. The repurchase program does not obligate the Company to purchase any particular number of shares. On February 9, 2023, the Company’s Board of Directors authorized a new $700 million share repurchase program. Under this program, the Company may, from time to time, purchase shares of its common stock through various means. The Company may choose to suspend or discontinue the repurchase program at any time. The repurchase program does not obligate the Company to purchase any particular number of shares. As of March 31, 2023, Holdings had authorized capacity of approximately $870 million remaining in its share repurchase program.

Holdings repurchased a total of 7.3 million and 8.6 million shares of its common stock at an average price of $29.16 and $31.96 through open market repurchases, ASRs and privately negotiated transactions during the three months ended March 31, 2023 and 2022, respectively.

During the three months ended March 31, 2023 and 2022, Holdings repurchased 4.5 million and 7.9 million shares of its common stock through open market repurchases.

In January 2023, Holdings entered into an ASR with a third-party financial institution to repurchase an aggregate of $75 million of Holdings’ common stock. Pursuant to the ASR, Holdings made a prepayment of $75 million and received initial delivery of 2 million Holdings’ shares. The ASR terminated in March 2023, at which time an additional 424,000 shares of common stock were received.

66

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Accumulated Other Comprehensive Income (Loss)

AOCI represents cumulative gains (losses) on items that are not reflected in net income (loss). The balances as of March 31, 2023 and December 31, 2022 follow:

	March 31,		December 31,
	2023		2022
	(in millions)
Unrealized gains (losses) on investments	$	(7,917)	$	(9,324)
Market risk benefits - instrument-specific credit risk component	1,855		668
Liability for future policy benefits - current discount rate component	213		355
Defined benefit pension plans	(629)		(650)
Foreign currency translation adjustments	(85)		(91)
Total accumulated other comprehensive income (loss)	(6,563)		(9,042)
Less: Accumulated other comprehensive income (loss) attributable to noncontrolling interest	(47)		(50)
Accumulated other comprehensive income (loss) attributable to Holdings	$	(6,516)	$	(8,992)

The components of OCI, net of taxes for the three months ended March 31, 2023 and 2022 is as follows:

		Three Months Ended March 31,
		2023		2022
	(in millions)
Change in net unrealized gains (losses) on investments:
Net unrealized gains (losses) arising during the period		$	1,571	$	(5,080)
(Gains) losses reclassified into net income (loss) during the period (1)		63		264
Net unrealized gains (losses) on investments		1,634		(4,816)
Adjustments for policyholders’ liabilities, DAC, insurance liability loss recognition and other		(8)		139
Change in unrealized gains (losses), net of adjustments (net of deferred income tax expense (benefit) of $341 and $(1,244))		1,626		(4,677)
Change in LFPB discount rate and MRB credit risk, net of tax
Market risk benefits - changes in instrument-specific credit risk (net of deferred income tax expense (benefit) of $249 and $418)		938		1,573
Liability for future policy benefits - changes in current discount rate (net of deferred income tax expense (benefit) of $(30) and $123)		(112)		462
Change in defined benefit plans:
Reclassification to Net income (loss) of amortization of net prior service credit included in net periodic cost (3)		20		43
Change in defined benefit plans (net of deferred income tax expense (benefit) of $(6) and $(9))		20		43
Foreign currency translation adjustments:
Foreign currency translation gains (losses) arising during the period		6		(12)
Foreign currency translation adjustment		6		(12)
Total other comprehensive income (loss), net of income taxes		2,478		(2,611)
Less: Other comprehensive income (loss) attributable to noncontrolling interest		2		(4)
Other comprehensive income (loss) attributable to Holdings		$	2,476	$	(2,607)

______________

(1)See “reclassification adjustment” in Note 3 of the Notes to these Consolidated Financial Statements. Reclassification amounts presented net of income tax expense (benefit) of $(17) million and $(70) million for the three months ended March 31, 2023 and 2022, respectively.

Investment gains and losses reclassified from AOCI to net income (loss) primarily consist of realized gains (losses) on sales and credit losses of AFS securities and are included in total investment gains (losses), net on the consolidated statements of income (loss). Amounts reclassified from AOCI to net income (loss) as related to defined benefit plans

67

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

primarily consist of amortization of net (gains) losses and net prior service cost (credit) recognized as a component of net periodic cost and reported in compensation and benefits in the consolidated statements of income (loss). Amounts presented in the table above are net of tax.

14)    SHORT-TERM AND LONG-TERM DEBT

On January 11, 2023, the Company issued $500 million aggregate principal amount of senior notes (the “Senior Notes”). These amounts were recorded net of the underwriting discount and issuance costs of $5 million. The Company will pay semiannual interest on the Senior Notes on January 11 and July 11 of each year, commencing on July 11, 2023, and the Senior Notes will mature on January 11, 2033. The Senior Notes bear interest at 5.594% per annum. On any date prior to October 11, 2032, the Company may redeem some or all of the Senior Notes, subject to a make-whole provision. At any time on or after October 11, 2032, the Company may, at its option, redeem the Notes in whole or in part, at a price equal to 100% of the principal amount of the Senior Notes being redeemed plus accrued and unpaid interest thereon to the redemption date. The Senior Notes contain customary affirmative and negative covenants, including a limitation on certain liens and a limit on the Company’s ability to consolidate, merge, sell or otherwise dispose of all or substantially all of its assets. The Senior Notes also include customary events of default (with customary grace periods, as applicable), including provisions under which, upon the occurrence of an event of default, all outstanding Senior Notes may be accelerated.

15)    REDEEMABLE NONCONTROLLING INTEREST

The changes in the components of redeemable noncontrolling interests are presented in the table that follows:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Balance, beginning of the period	$	455	$	468
Net earnings (loss) attributable to redeemable noncontrolling interests	12		(27)
Purchase/change of redeemable noncontrolling interests	146		(55)
Balance, end of the period	$	613	$	386

16)    COMMITMENTS AND CONTINGENT LIABILITIES

Litigation and Regulatory Matters

Litigation, regulatory and other loss contingencies arise in the ordinary course of the Company’s activities as a diversified financial services firm. The Company is a defendant in a number of litigation matters arising from the conduct of its business. In some of these matters, claimants seek to recover very large or indeterminate amounts, including compensatory, punitive, treble and exemplary damages. Modern pleading practice permits considerable variation in the assertion of monetary damages and other relief. Claimants are not always required to specify the monetary damages they seek, or they may be required only to state an amount sufficient to meet a court’s jurisdictional requirements. Moreover, some jurisdictions allow claimants to allege monetary damages that far exceed any reasonably possible verdict. The variability in pleading requirements and past experience demonstrates that the monetary and other relief that may be requested in a lawsuit or claim often bears little relevance to the merits or potential value of a claim. Litigation against the Company includes a variety of claims including, among other things, insurers’ sales practices, alleged agent misconduct, alleged failure to properly supervise agents, contract administration, product design, features and accompanying disclosure, cost of insurance increases, payments of death benefits and the reporting and escheatment of unclaimed property, alleged breach of fiduciary duties, alleged mismanagement of client funds and other matters.

The outcome of a litigation or regulatory matter is difficult to predict, and the amount or range of potential losses associated with these or other loss contingencies requires significant management judgment. It is not possible to predict the ultimate outcome or to provide reasonably possible losses or ranges of losses for all pending regulatory matters, litigation and other loss contingencies. While it is possible that an adverse outcome in certain cases could have a material adverse effect upon the Company’s financial position, based on information currently known, management believes that neither the outcome of pending litigation and regulatory matters, nor potential liabilities associated with other loss contingencies, are likely to have such an effect. However, given the large and indeterminate amounts sought

68

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

in certain litigation and the inherent unpredictability of all such matters, it is possible that an adverse outcome in certain of the Company’s litigation or regulatory matters, or liabilities arising from other loss contingencies, could, from time to time, have a material adverse effect upon the Company’s results of operations or cash flows in a particular quarterly or annual period.

For some matters, the Company is able to estimate a range of loss. For such matters in which a loss is probable, an accrual has been made. For matters where the Company believes a loss is reasonably possible, but not probable, no accrual is required. For matters for which an accrual has been made, but there remains a reasonably possible range of loss in excess of the amounts accrued or for matters where no accrual is required, the Company develops an estimate of the unaccrued amounts of the reasonably possible range of losses. As of March 31, 2023, the Company estimates the aggregate range of reasonably possible losses, in excess of any amounts accrued for these matters as of such date, to be up to approximately $250 million.

For other matters, the Company is currently not able to estimate the reasonably possible loss or range of loss. The Company is often unable to estimate the possible loss or range of loss until developments in such matters have provided sufficient information to support an assessment of the range of possible loss, such as quantification of a damage demand from plaintiffs, discovery from plaintiffs and other parties, investigation of factual allegations, rulings by a court on motions or appeals, analysis by experts and the progress of settlement discussions. On a quarterly and annual basis, the Company reviews relevant information with respect to litigation and regulatory contingencies and updates the Company’s accruals, disclosures and reasonably possible losses or ranges of loss based on such reviews.

In February 2016, a lawsuit was filed in the Southern District of New York entitled Brach Family Foundation, Inc. v. AXA Equitable Life Insurance Company. This lawsuit is a putative class action brought on behalf of all owners of UL policies subject to Equitable Financial’s COI rate increase. In early 2016, Equitable Financial raised COI rates for certain UL policies issued between 2004 and 2008, which had both issue ages 70 and above and a current face value amount of $1 million and above. A second putative class action was filed in the District of Arizona in 2017 and consolidated with the Brach matter in federal court in New York. The consolidated amended class action complaint alleges the following claims: breach of contract; misrepresentations in violation of Section 4226 of the New York Insurance Law; violations of New York General Business Law Section 349; and violations of the California Unfair Competition Law, and the California Elder Abuse Statute. Plaintiffs seek: (a) compensatory damages, costs, and, pre- and post-judgment interest; (b) with respect to their claim concerning Section 4226, a penalty in the amount of premiums paid by the plaintiffs and the putative class; and (c) injunctive relief and attorneys’ fees in connection with their statutory claims. In August 2020, the federal district court issued a decision certifying nationwide breach of contract and Section 4226 classes, and a New York State Section 349 class. Owners of a substantial number of policies opted out of the Brach class action. Most opt-out policies are not yet the subject of litigation. Others filed suit previously including three federal actions that have been coordinated with the Brach action and contain similar allegations along with additional allegations for violations of state consumer protection statutes and common law fraud. In March 2022, the federal district court issued a summary judgment decision, denying in significant part but granting in part Equitable Financial’s motion and denying the motion filed by plaintiffs in the coordinated actions. In July 2022, the federal district court granted Equitable Financial’s motion to reconsider its summary judgment decision in part and granted summary judgment as to a portion of the Section 4226 class. The federal district court also agreed to consider whether it should decertify the Section 4226 class. In January 2023, the federal district court declined to decertify the class and instead modified it to replace certain class members. Beginning October 30, 2023, the federal district court will hold one consolidated trial for the Brach action and the three coordinated actions. Equitable Financial has commenced settlement discussions with the Brach class action plaintiffs and plaintiffs in the coordinated actions. No assurances can be given about the outcome of those settlement discussions. Equitable Financial has settled actual and threatened litigations challenging the COI increase by individual policy owners and one entity that invested in numerous policies purchased in the life settlement market. Two actions are also pending against Equitable Financial in New York state court. In July 2022, the trial court in one of the New York state court actions, Hobish v. AXA Equitable Life Insurance Company, granted in significant part Equitable Financial’s motion for summary judgment and denied plaintiff’s cross motion. That plaintiff filed a notice of appeal and Equitable filed a notice of cross-appeal. Equitable Financial is vigorously defending each of these matters.

As with other financial services companies, Equitable Financial periodically receives informal and formal requests for information from various state and federal governmental agencies and self-regulatory organizations in connection with inquiries and investigations of the products and practices of the Company or the financial services industry. It is the practice of the Company to cooperate fully in these matters.

69

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Obligations under Funding Agreements

Pre-Capitalized Trust Securities (“P-Caps”)

In April 2019, pursuant to separate Purchase Agreements among Holdings, Credit Suisse Securities (USA) LLC, as representative of the several initial purchasers, and the Trusts (as defined below), Pine Street Trust I, a Delaware statutory trust (the “2029 Trust”), completed the issuance and sale of 600,000 of its Pre-Capitalized Trust Securities redeemable February 15, 2029 (the “2029 P-Caps”) for an aggregate purchase price of $600 million and Pine Street Trust II, a Delaware statutory trust (the “2049 Trust” and, together with the 2029 Trust, the “Trusts”), completed the issuance and sale of 400,000 of its Pre-Capitalized Trust Securities redeemable February 15, 2049 (the “2049 P-Caps” and, together with the 2029 P-Caps, the “P-Caps”) for an aggregate purchase price of $400 million in each case to qualified institutional buyers in reliance on Rule 144A that are also “qualified purchasers” for purposes of Section 3(c)(7) of the Investment Company Act of 1940, as amended.

The P-Caps are an off-balance sheet contingent funding arrangement that, upon Holdings’ election, gives Holdings the right over a ten-year period (in the case of the 2029 Trust) or over a thirty-year period (in the case of the 2049 Trust) to issue senior notes to these Trusts. The Trusts each invested the proceeds from the sale of their P-Caps in separate portfolios of principal and/or interest strips of U.S. Treasury securities. In return, Holdings will pay a semi-annual facility fee to the 2029 Trust and 2049 Trust calculated at a rate of 2.125% and 2.715% per annum, respectively, which will be applied to the unexercised portion of the contingent funding arrangement and Holdings will reimburse the Trusts for certain expenses. The facility fees are recorded in Other operating costs and expenses in the Consolidated Statements of Income (Loss).

Federal Home Loan Bank (“FHLB”)

As a member of the FHLB, Equitable Financial has access to collateralized borrowings. It also may issue funding agreements to the FHLB. Both the collateralized borrowings and funding agreements would require Equitable Financial to pledge qualified mortgage-backed assets and/or government securities as collateral. Equitable Financial issues short-term funding agreements to the FHLB and uses the funds for asset, liability, and cash management purposes. Equitable Financial issues long-term funding agreements to the FHLB and uses the funds for spread lending purposes.

Entering into FHLB membership, borrowings and funding agreements requires the ownership of FHLB stock and the pledge of assets as collateral. Equitable Financial has purchased FHLB stock of $388 million and pledged collateral with a carrying value of $13.0 billion as of March 31, 2023.

Funding agreements are reported in policyholders’ account balances in the consolidated balance sheets. For other instruments used for asset/liability and cash management purposes, see “Offsetting of Financial Assets and Liabilities and Derivative Instruments” included in Note 4 of the Notes to these Consolidated Financial Statements. The table below summarizes the Company’s activity of funding agreements with the FHLB.

Change in FHLB Funding Agreements during the Three Months Ended March 31, 2023

	Outstanding Balance at December 31, 2022		Issued During the Period		Repaid During the Period		Long-term Agreements Maturing Within One Year		Long-term Agreements Maturing Within Five Years		Outstanding Balance at March 31, 2023
	(in millions)
Short-term funding agreements:
Due in one year or less	$	6,130	$	14,066	$	(14,201)	$	—	$	—	$	5,995
Long-term funding agreements:
Due in years two through five	1,679		—		—		—		—		1,679
Due in more than five years	692		—		—		—		—		692
Total long-term funding agreements	2,371		—		—		—		—		2,371
Total funding agreements (1)	$	8,501	$	14,066	$	(14,201)	$	—	$	—	$	8,366

_____________

(1)The $3 million and $4 million difference between the funding agreements carrying value shown in fair value table for March 31, 2023 and December 31, 2022, respectively, reflects the remaining amortization of a hedge implemented and closed, which locked in the funding agreements borrowing rates.

70

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

Funding Agreement-Backed Notes Program (“FABN”)

Under the FABN program, Equitable Financial may issue funding agreements in U.S. dollar or other foreign currencies to a Delaware special purpose statutory trust (the “Trust”) in exchange for the proceeds from issuances of fixed and floating rate medium-term marketable notes issued by the Trust from time to time (the “Trust Notes”). The funding agreements have matching interest, maturity and currency payment terms to the applicable Trust Notes. The Company hedges the foreign currency exposure of foreign currency denominated funding agreements using cross currency swaps as discussed in Note 4 of the Notes to these Consolidated Financial Statements. As of March 31, 2023, the maximum aggregate principal amount of Trust Notes permitted to be outstanding at any one time is $10.0 billion. Funding agreements issued to the Trust, including any foreign currency transaction adjustments, are reported in policyholders’ account balances in the consolidated balance sheets. Foreign currency transaction adjustments to policyholder’s account balances are recognized in net income (loss) as an adjustment to interest credited to policyholders’ account balances and are offset in interest credited to policyholders’ account balances by a release of AOCI from deferred changes in fair value of designated and qualifying cross currency swap cash flow hedges. The table below summarizes Equitable Financial’s activity of funding agreements under the FABN program.

Change in FABN Funding Agreements during the Three Months Ended March 31, 2023

	Outstanding Balance at December 31, 2022		Issued During the Period		Repaid During the Period		Long-term Agreements Maturing Within One Year		Long-term Agreements Maturing Within Five Years		Foreign Currency Transaction Adjustment		Outstanding Balance at March 31, 2023
	(in millions)
Short-term funding agreements:
Due in one year or less	$	1,500	$	—	$	—	$	—	$	—	$	—	$	1,500
Long-term funding agreements:
Due in years two through five	4,000		300		—		—		750		—		5,050
Due in more than five years	1,585		—		—		—		(750)		7		842
Total long-term funding agreements	5,585		300		—		—		—		7		5,892
Total funding agreements (1)	$	7,085	$	300	$	—	$	—	$	—	$	7	$	7,392

_____________

(1)The $25 million and $66 million difference between the funding agreements notional value shown and carrying value table as of March 31, 2023 and December 31, 2022, respectively, reflects the remaining amortization of the issuance cost of the funding agreements and the foreign currency transaction adjustment.

Credit Facilities

For information regarding activity pertaining to our credit facilities arrangements, see Note 14 of the Notes to these Consolidated Financial Statements.

Guarantees and Other Commitments

The Company provides certain guarantees or commitments to affiliates and others. As of March 31, 2023, these arrangements include commitments by the Company to provide equity financing of $1.3 billion to certain limited partnerships and real estate joint ventures under certain conditions. Management believes the Company will not incur material losses as a result of these commitments.

The Company had $17 million of undrawn letters of credit related to reinsurance as of March 31, 2023. The Company had $764 million of commitments under existing mortgage loan agreements as of March 31, 2023.

The Company is the obligor under certain structured settlement agreements it had entered into with unaffiliated insurance companies and beneficiaries. To satisfy its obligations under these agreements, the Company owns single premium annuities issued by previously wholly-owned life insurance subsidiaries. The Company has directed payment under these annuities to be made directly to the beneficiaries under the structured settlement agreements. A contingent liability exists with respect to these agreements should the previously wholly-owned subsidiaries be unable to meet their obligations. Management believes the need for the Company to satisfy those obligations is remote.

71

EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

17)    BUSINESS SEGMENT INFORMATION

As previously announced, effective January 1, 2023, our financial reporting presentation was revised to reflect the reorganization of the Company’s reportable segments to reflect how the Company’s chief operating decision maker now makes operating decisions and assesses performance. We now have six reportable segments. Prior period results have been revised in connection with updates to our reportable segments.

The six reportable segments are: Individual Retirement, Group Retirement, Investment Management and Research, Protection Solutions, Wealth Management and Legacy.

These segments reflect the manner by which the Company’s chief operating decision maker views and manages the business. A brief description of these segments follows:

•The Individual Retirement segment offers a diverse suite of variable annuity products which are primarily sold to affluent and high net worth individuals saving for retirement or seeking retirement income.

•The Group Retirement segment offers tax-deferred investment and retirement services or products to plans sponsored by educational entities, municipalities and not-for-profit entities, as well as small and medium-sized businesses.

•The Investment Management and Research segment provides diversified investment management, research and related solutions globally to a broad range of clients through three main client channels - Institutional, Retail and Private Wealth - and distributes its institutional research products and solutions through Bernstein Research Services.

•The Protection Solutions segment includes our life insurance and group employee benefits businesses. Our life insurance business offers a variety of VUL, UL and term life products to help affluent and high net worth individuals, as well as small and medium-sized business owners, with their wealth protection, wealth transfer and corporate needs. Our group employee benefits business offers a suite of dental, vision, life, and short- and long-term disability and other insurance products to small and medium-size businesses across the United States.

•The Wealth Management segment offers discretionary and non-discretionary investment advisory accounts, financial planning and advice, life insurance, and annuity products through Equitable Advisors.

•The Legacy segment primarily consists of the capital intensive fixed-rate GMxB business written in the Individual Retirement market prior to 2011. This business offered GMDB features in isolation or together with GMLB features. This business also historically offered variable annuities with four types of guaranteed living benefit riders: GMIB, GWBL/GMWB, and GMAB.

Measurement

Operating earnings (loss) is the financial measure which primarily focuses on the Company’s segments’ results of operations as well as the underlying profitability of the Company’s core business. By excluding items that can be distortive and unpredictable such as investment gains (losses) and investment income (loss) from derivative instruments, the Company believes operating earnings (loss) by segment enhances the understanding of the Company’s underlying drivers of profitability and trends in the Company’s segments.

Operating earnings is calculated by adjusting each segment’s net income (loss) attributable to Holdings for the following items:

•Items related to variable annuity product features, which include: (i) changes in the fair value of market risk benefits and purchased market risk benefits, including the related attributed fees and claims, offset by derivatives and other securities used to hedge the market risk benefits which result in residual net income volatility as the change in fair value of certain securities is reflected in OCI and due to our statutory capital hedge program; and (ii) market adjustments to deposit asset or liability accounts arising from reinsurance agreements which do not expose the reinsurer to a reasonable possibility of a significant loss from insurance risk;

•Investment (gains) losses, which includes credit loss impairments of securities/investments, sales or disposals of securities/investments, realized capital gains/losses and valuation allowances;

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

•Net actuarial (gains) losses, which includes actuarial gains and losses as a result of differences between actual and expected experience on pension plan assets or projected benefit obligation during a given period related to pension, other postretirement benefit obligations, and the one-time impact of the settlement of the defined benefit obligation;

•Other adjustments, which primarily include restructuring costs related to severance and separation, lease write-offs related to non-recurring restructuring activities, COVID-19 related impacts, net derivative gains (losses) on certain Non-GMxB derivatives, net investment income from certain items including consolidated VIE investments, seed capital mark-to-market adjustments, unrealized gain/losses and realized capital gains/losses from sales or disposals of select securities, certain legal accruals; and a bespoke deal to repurchase UL policies from one entity that had invested in numerous policies purchased in the life settlement market, which disposed of the risk of additional COI litigation by that entity related to those UL policies; and

•Income tax expense (benefit) related to the above items and non-recurring tax items, which includes the effect of uncertain tax positions for a given audit period, and a decrease of a deferred tax valuation allowance.

The General Account investment portfolio is used to support the insurance and annuity liabilities of our Individual Retirement, Group Retirement, Protection Solutions and Legacy business segments. In the first quarter 2022, the Company changed its methodology for allocating its General Account investment portfolio, which resulted in a change in the asset and net investment income allocation amongst the Company’s business segments. Following this change, the segmentation of the general account investments is now more closely aligned with the liability characteristics of the product groups. Management determined that the change in the allocation methodology allows for improved flexibility and infuses an active asset liability management practice into the segmentation process. Additionally, the Company also changed its basis for allocating the spread earned from our FHLB investment borrowing and FABN programs. The spread earned from our FHLB investment borrowing and FABN programs includes the investment income on the assets less interest credited on the funding agreements. The net spread as reflected in net investment income is allocated to the segments based on the percentage of the individual segment’s insurance liabilities over the combined segments insurance liabilities.

This change in measurement only impacts our segment disclosures, and thus has no impact on our overall consolidated financial statements. Historical segment operating income (loss), revenues and assets have not been recast in the tables as the impact was immaterial.

Revenues derived from any customer did not exceed 10% of revenues for the three months ended March 31, 2023 and 2022.

The Company accounts for intersegment sales and transfers as if the sales or transfers were to third parties, that is, at current market prices.

The table below presents operating earnings (loss) by segment and Corporate and Other and a reconciliation to net income (loss) attributable to Holdings for the three months ended March 31, 2023 and 2022, respectively:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Net income (loss) attributable to Holdings	$	177	$	530
Adjustments related to:
Variable annuity product features	861		(616)
Investment (gains) losses	87		326
Net actuarial (gains) losses related to pension and other postretirement benefit obligations	9		19
Other adjustments (1)	45		228
Income tax expense (benefit) related to above adjustments	(210)		9
Non-recurring tax items	(605)		3
Non-GAAP Operating Earnings	$	364	$	499

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	Three Months Ended March 31,
	2023		2022
	(in millions)
Operating earnings (loss) by segment:
Individual Retirement	$	200	$	203
Group Retirement	$	89	$	144
Investment Management and Research	$	99	$	136
Protection Solutions	$	(35)	$	(3)
Wealth Management	$	32	$	32
Legacy	$	60	$	63
Corporate and Other (2)	$	(81)	$	(76)

______________

(1)Includes certain legal accruals related to the COI litigation of $59 million for the three months ended March 31, 2022 .Includes policyholder benefit costs of $75 million for the three months ended March 31, 2022 stemming from a deal to repurchase UL policies from one entity that had invested in numerous policies purchased in the life settlement market.

(2)Includes interest expense and financing fees of $67 million and $53 million for the three months ended March 31, 2023 and 2022, respectively.

Segment revenues is a measure of the Company’s revenue by segment as adjusted to exclude certain items. The following table reconciles segment revenues to total revenues by excluding the following items:

•Items related to variable annuity product features, which include certain changes in the fair value of the derivatives and other securities we use to hedge these features and changes in the fair value of the embedded derivatives reflected within the net derivative results of variable annuity product features;

•Investment (gains) losses, which includes credit loss impairments of securities/investments, sales or disposals of securities/investments, realized capital gains/losses and valuation allowances;

•Other adjustments, which primarily includes net derivative gains (losses) on certain Non-GMxB derivatives and net investment income from certain items including consolidated VIE investments, seed capital mark-to-market adjustments and unrealized gain/losses associated with equity securities. The table below presents segment revenues for the three months ended March 31, 2023 and 2022.

	Three Months Ended March 31,
	2023		2022
	(in millions)
Segment revenues:
Individual Retirement (1)	$	588	$	507
Group Retirement (1)	237		335
Investment Management and Research (2)	1,009		1,135
Protection Solutions (1)	767		809
Wealth Management (3)	362		376
Legacy (1)	206		215
Corporate and Other (1)	281		223
Eliminations	(180)		(199)
Adjustments related to:
Variable annuity product features	(861)		616
Investment gains (losses), net	(87)		(326)
Other adjustments to segment revenues	35		(545)
Total revenues	$	2,357	$	3,146

______________

(1)Includes investment expenses charged by AB of $38 million and $27 million for the three months ended March 31, 2023 and 2022, respectively, for services provided to the Company.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

(2)Inter-segment investment management and other fees of $43 million and $33 million for the three months ended March 31, 2023 and 2022, respectively, are included in segment revenues of the Investment Management and Research segment.

(3)Inter-segment distribution fees of $175 million and $193 million for the three months ended March 31, 2023 and 2022, respectively, are included in segment revenues of the Wealth Management segment.

(4)Includes interest expense charged to AB of $9 million and $0 million for the three months ended March 31, 2023 and 2022, respectively.

The table below presents total assets by segment as of March 31, 2023 and 2022:

	March 31, 2023		December 31, 2022
	(in millions)
Total assets by segment:
Individual Retirement	$	77,922	$	77,641
Group Retirement	44,171		42,421
Investment Management and Research	11,864		12,633
Protection Solutions	37,845		37,224
Wealth Management	174		137
Legacy	49,804		48,231
Corporate and Other	39,720		34,415
Total assets	$	261,500	$	252,702

18)    INSURANCE GROUP STATUTORY FINANCIAL INFORMATION

Prescribed and Permitted Accounting Practices

As of March 31, 2023, the following three prescribed and permitted practices resulted in net income (loss) and capital and surplus that is different from the statutory surplus that would have been reported had NAIC statutory accounting practices been applied.

Equitable Financial was granted a permitted practice by the NYDFS to apply SSAP 108, Derivatives Hedging Variable Annuity Guarantees on a retroactive basis from January 1, 2021 through June 30, 2021, after reflecting the impacts of our reinsurance transaction with Venerable. The permitted practice was amended to also permit Equitable Financial to adopt SSAP 108 prospectively as of July 1, 2021 and to consider the impact of both the interest rate derivatives and the General Account assets used to fully hedge the interest rate risk inherent in its variable annuity guarantees when determining the amount of the deferred asset or liability under SSAP 108. Application of the permitted practice partially mitigates the New York Insurance Regulation 213 (“Reg 213”) impact of the Venerable Transaction on Equitable Financial’s statutory capital and surplus and enables Equitable Financial to more effectively neutralize the impact of interest rates on its statutory surplus and to better align with our economic hedging program. The impact of applying this permitted practice relative to SSAP 108 as written was an increase of approximately $63 million in statutory special surplus funds and a decrease of $22 million in statutory net income for the three months ended March 31, 2023, which will be amortized over five years for each of the retrospective and prospective components. The permitted practice also reset Equitable Financial’s unassigned surplus to zero as of June 30, 2021 to reflect the transformative nature of the Venerable Transaction.

The NAIC Accounting Practices and Procedures manual (“NAIC SAP”) has been adopted as a component of prescribed or permitted practices by the State of New York. However, Reg 213 adopted in May of 2019 and as amended in February 2020 and March 2021, differs from the NAIC variable annuity reserve and capital framework. Reg 213 requires Equitable Financial to carry statutory basis reserves for its variable annuity contract obligations equal to the greater of those required under (i) the NAIC standard or (ii) a revised version of the NYDFS requirement in effect prior to the adoption of the first amendment for contracts issued prior to January 1, 2020, and for policies issued after that date a new standard that in current market conditions imposes more conservative reserving requirements for variable annuity contracts than the NAIC standard.

The impact of the application of Reg 213 was a decrease of approximately $2.2 billion in statutory surplus as of March 31, 2023 compared to statutory surplus under the NAIC variable annuity framework. Our hedging program is designed to hedge the economics of our insurance liabilities and largely offsets Reg 213 and NAIC framework reserve movements due to interest rates and equities. The NYDFS allows domestic insurance companies a five year phase-in provision for Reg 213 reserves. As of September 30, 2022, Equitable Financial’s Reg 213 reserves were 100% phased-

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

in. As of March 31, 2023, given the prevailing market conditions and business mix, there are no Reg 213 redundant reserves over the US RBC CTE 98 total asset requirement (“TAR”). Finally, the continued application of Reg 213 resulted in a corresponding decrease of $0.3 billion in statutory net income for the three months ended March 31, 2023, which was largely offset by net income gains on our hedging program during the same period as noted.

During the fourth quarter 2020, Equitable Financial received approval from NYDFS for its proposed amended Plan of Operation for Separate Account No. 68 (“SA 68”) for our Structured Capital Strategies product and Separate Account No. 69 (“SA 69”) for our EQUI-VEST product Structured Investment Option, to change the accounting basis of these two non-insulated Separate Accounts from fair value to book value in accordance with Section 1414 of the Insurance Law to align with how we manage and measure our overall general account asset portfolio. In order to facilitate this change and comply with Section 4240(a)(10), the Company also sought approval to amend the Plans to remove the requirement to comply with Section 4240(a)(5)(iii) and substitute it with a commitment to comply with Section 4240(a)(5)(i). Similarly, the Company updated the reserves section of each Plan to reflect the fact that Regulation 128 would no longer be applicable upon the change in accounting basis. We applied this change effective January 1, 2021. The impact of the application is an increase of approximately $2.0 billion in statutory surplus and a decrease in statutory net income for the three months ended March 31, 2023 of $157 million.

19)    EARNINGS PER COMMON SHARE

The following table presents a reconciliation of Net income (loss) and Weighted-average common shares used in calculating basic and diluted Earnings per common share for the periods indicated:

	Three Months Ended March 31,
	2023		2022
	(in millions, except per share data)
Weighted-average common shares outstanding:
Weighted-average common shares outstanding — basic	361.9		388.6
Effect of dilutive potential common shares:
Employee share awards (1)	2.2		3.1
Weighted-average common shares outstanding — diluted	364.1		391.7
Net income (loss):
Net income (loss)	$	266	$	597
Less: Net income (loss) attributable to the noncontrolling interest	89		67
Net income (loss) attributable to Holdings	177		530
Less: Preferred stock dividends	14		14
Net income (loss) available to Holdings’ common shareholders	$	163	$	516
Earnings per common share:
Basic	$	0.45	$	1.33
Diluted	$	0.45	$	1.32

_____________

(1)Calculated using the treasury stock method.

For the three months ended March 31, 2023 and 2022, 2.5 million and 3.3 million of outstanding stock awards, respectively, were not included in the computation of diluted earnings per share because their effect was anti-dilutive.

20)     HELD-FOR-SALE

Assets and liabilities related to the business classified as HFS are separately reported in the Consolidated Balance Sheets beginning in the period in which the business is classified as HFS.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

AB Bernstein Research Services

On November 22, 2022, AB and Société Générale, a leading European bank, announced plans to form a joint venture combining their respective cash equities and research businesses. The consummation of the joint venture is subject to customary closing conditions, including regulatory clearances. The closing is expected to occur before the end of 2023. Upon closing, AB will own a 49% interest in the joint venture and Société Générale will own a 51% interest in the joint venture, with an option to reach 100% ownership after five years. The assets and liabilities of AB's research services business recorded at fair value, less cost to sell have been classified as held-for-sale in our Consolidated Financial Statements. As a result of classifying these assets as held-for-sale, AB recognized a non-cash valuation adjustment of $3 million and $7 million on the consolidated statement of income, to recognize the net carrying value at lower of cost or fair value, less costs to sell for the three months ended as of March 31, 2023 and as of December 31, 2022, respectively.

The following table summarizes the assets and liabilities classified as held-for-sale as of March 31, 2023 and December 31, 2022 on the Company’s consolidated balance sheet:

	March 31, 2023 (1)		December 31, 2022 (1)
	(in millions)
Cash and cash equivalents	$	154	$	159
Broker-dealer related receivables	94		74
Trading securities, at fair value	16		25
Goodwill and other intangible assets ,net	165		175
Other assets (2)	242		129
Total assets held-for-sale	$	671	$	562
Broker-dealer related payables	$	43	$	33
Customers related payables	32		10
Other liabilities	83		65
Total liabilities held-for-sale	$	158	$	108

____________

(1)    The assets and liabilities classified as held-for-sale are reported within our Investment Management & Research segment.

(2)    Other assets includes a valuation adjustment of $(10) million and $(7) million, as of March 31, 2023 and December 31, 2022, respectively.

These assets and liabilities are reported under the Investment Management & Research segment. The Company has determined that AB’s exit from the research business did not represent a strategic shift that had a major effect on AB’s or the Company’s consolidated results of operations, and therefore, are not classified as discontinued operations.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

21    REINSURANCE

The Company assumes and cedes reinsurance with other insurance companies. The Company evaluates the financial condition of its reinsurers to minimize its exposure to significant losses from reinsurer insolvencies. Ceded reinsurance does not relieve the originating insurer of liability.

The following table summarizes the effect of reinsurance. The impact of the transactions described above results in a decrease to reinsurance assumed and an increase in reinsurance ceded.

	Three Months Ended March 31,
	2023		2022
	(in millions)
Direct premiums	$	290	$	250
Reinsurance assumed	52		50
Reinsurance ceded	(66)		(53)
Premiums	$	276	$	247
Direct charges and fee income	$	777	$	834
Reinsurance ceded	(189)		(184)
Policy charges and fee income	$	588	$	650
Direct policyholders’ benefits	$	859	$	917
Reinsurance assumed	36		55
Reinsurance ceded	(165)		(170)
Policyholders’ benefits	$	730	$	802
Direct interest credited to policyholders’ account balances	$	464	$	338
Reinsurance ceded	(1)		(25)
Interest credited to policyholders’ account balances	$	463	$	313

Ceded Reinsurance

The Company reinsures most of its new variable life, UL and term life policies on an excess of retention basis. The Company generally retains on a per life basis up to $25 million for single lives and $30 million for joint lives with the excess 100% reinsured. The Company also reinsures risk on certain substandard underwriting risks and in certain other cases.

On October 3, 2022, as part of the Global Atlantic Transaction, Equitable Financial ceded to First Allmerica Financial Life Insurance Company on a combined coinsurance and modified coinsurance basis, a 50% quota share of approximately 360,000 legacy Group EQUI-VEST deferred variable annuity contracts issued by Equitable Financial between 1980 and 2008.

In addition to the above, the Company cedes a portion of its group health, extended term insurance, and paid-up life insurance and substantially all of its individual disability income business through various coinsurance agreements.

Assumed Reinsurance

In addition to the sale of insurance products, the Company currently assumes risk from professional reinsurers. The Company also had a run-off portfolio of assumed reinsurance liabilities at CSLRC which was sold to Venerable in June 2021. The Company assumes accident, life, health, annuity (including products covering GMDB and GMIB benefits), aviation, special risk and space risks by participating in or reinsuring various reinsurance pools and arrangements.

The following table summarizes the ceded reinsurance GMIB reinsurance contracts, third-party recoverables, amount due to reinsurance and assumed reserves.

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

	March 31, 2023		December 31, 2022
	(in millions)
Ceded Reinsurance:
Estimated net fair values of purchased market risk benefits	$	10,676	$	10,423
Third-party reinsurance recoverables related to insurance contracts	8,453		8,471
Top reinsurers:
First Allmerica-GAF	3,933		4,005
Zurich Life Insurance Company, Ltd.	1,401		1,416
RGA Reinsurance Company	1,301		1,272
Ceded group health reserves	48		47
Amount due to reinsurers	1,428		1,533
Top reinsurers:
RGA Reinsurance Company	1,175		1,171
First Allmerica-GAF	71		147
Protective Life Insurance Company	103		104
Assumed Reinsurance:
Reinsurance assumed reserves	$	694	$	701

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EQUITABLE HOLDINGS, INC.

Notes to Consolidated Financial Statements (Unaudited), Continued

22)     SUBSEQUENT EVENTS

Accelerated Share Repurchase Agreement

In April 2023, Holdings entered into an ASR with a third-party financial institution to repurchase an aggregate of $75 million of Holdings’ common stock. Pursuant to the ASR, Holdings made a prepayment of $75 million and received initial delivery of 2.4 million Holdings’ shares. The ASR terminated in May 2023, at which time an additional 598,000 shares of common stock were received.

Holdings Senior Notes Repayment

On April 20, 2018, Holdings issued $800 million aggregate principal amount of 3.9% Senior Notes due 2023. During 2021 Holdings made a principal prepayment of $280 million on the 3.9% Senior Notes. The remaining balance was paid in full on the due date of April 20, 2023.

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Item 2.     Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in its entirety and in conjunction with the consolidated financial statements and related notes contained in Part I, Item 1 of this Quarterly Report on Form 10-Q, as well as “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section contained in our Annual Report on Form 10-K for the year ended December 31, 2022 (“2022 Form 10-K”).

In addition to historical data, this discussion contains forward-looking statements about our business, operations and financial performance based on current expectations that involve risks, uncertainties and assumptions. Actual results may differ materially from those discussed in the forward-looking statements as a result of various factors. See the Note Regarding Forward-Looking Statements and Information. Investors are directed to consider the risks and uncertainties discussed in Part II, Item 1A of this Quarterly Report on Form 10-Q, as well as in other documents we have filed with the SEC.

Executive Summary

Overview

We are one of America’s leading financial services companies, providing: (i) advice and solutions for helping Americans set and meet their retirement goals and protect and transfer their wealth across generations; and (ii) a wide range of investment management insights, expertise and innovations to drive better investment decisions and outcomes for clients worldwide.

As previously announced, effective January 1, 2023, our financial reporting presentation was revised to reflect the reorganization of the Company’s reportable segments to reflect how the Company’s chief operating decision maker now makes operating decisions and assesses performance. We now manage our business through six segments: Individual Retirement, Group Retirement, Investment Management and Research, Protection Solutions, Wealth Management and Legacy. We report certain activities and items that are not included in these segments in Corporate and Other. Prior period results have been revised in connection with updates to our reportable segments. See Note 17 of the Notes to the Consolidated Financial Statements for further information on our segments.

We benefit from our complementary mix of businesses. This business mix provides diversity in our earnings sources, which helps offset fluctuations in market conditions and variability in business results, while offering growth opportunities.

Long - Duration Targeted Improvements (“LDTI”) Adoption

Effective January 1, 2023, the Company adopted ASU 2018-12 and elected a transition date of January 1, 2021, thereby permitting the Company to implement the standard only for the last two fiscal years rather than the customary last three fiscal years.

The Company adopted ASU 2018-12 for liability for future policy benefits, additional insurance liabilities, DAC and balances amortized on a basis consistent with DAC on a modified retrospective basis. ASU 2018-12 was adopted for MRBs on a full retrospective basis. See Note 2 of the Notes to the Consolidated Financial Statements for further information on the adoption of LDTI.

The following table presents the balances and changes to the balances for the market risk benefits for the GMxB benefits on deferred variable annuities for the three months ended March 31, 2023.

81

	March 31, 2023
	Individual Retirement		Legacy
	GMxB Core		GMxB Legacy		Purchased MRB		Net Legacy
	(in millions)
Balance, beginning of the period (“BOP”)	$	530	$	14,699	$	(10,415)	$	4,284
Balance BOP before changes in the instrument specific credit risk	529		15,314		(10,358)		4,956
Model changes and effect of changes in cash flow assumptions	—		—		—		—
Actual market movement effect	(211)		(744)		387		(357)
Interest accrual	18		197		(153)		44
Attributed fees accrued	95		209		(83)		126
Benefit payments	(12)		(342)		185		(157)
Actual policyholder behavior different from expected behavior	7		21		(18)		3
Changes in future economic assumptions	125		944		(530)		414
Issuances	(1)		—		—		—
Balance EOP before changes in the instrument-specific credit risk	550		15,599		(10,570)		5,029
Changes in the instrument-specific credit risk	(233)		(1,517)		(99)		(1,616)
Balance, end of the period (“EOP”)	$	317	$	14,082	$	(10,669)	$	3,413

The following discussion provides an overview on the table above.

The effect of actual market movement in equity is materially offset by hedging gains/losses, which are not shown in the table above.

“Attributed fees accrued” represents the portion of the fees set aside to fund future GMxB claims. For our Core business, the $95 million for the three months ended March 31, 2023, attributed fees set aside is less than the explicit GMxB Rider fees we actually collect from policyholders. For our Core business, the net riders fees (rider fees charged minus attributed fees) reported in our Policy charges and fee income line is $18 million for the three months ended March 31, 2023. This means that the GMxB rider fees we charge more than cover the future claims and hedging costs associated with the GMxB riders. For our Legacy business, the attributed fees of $209 million set aside to fund future GMxB claims is more than the rider fees actually collected from policyholders. This is because the product was not sufficiently priced for the claims we now expect. This required us to attribute a portion of the base contract fees, in addition to the rider fees, to reserve for the rider claims. Net rider fees (rider fees charged minus attributed fees), net of reinsurance, for Legacy business reported in the Policy charges and fee income line are a loss of $68 million for the three months ended March 31, 2023, and are more than covered by base contract fees.

“Actual policyholder behavior different from expected behavior” measures the effectiveness of our modeling of policyholder behavior. Put differently, it measures the difference between our expectations about how our MRB rider reserves would change in response to policyholder behavior, and how our MRB rider reserves actually changed in response to policyholder behavior. For our Core business in the quarter ended March 31, 2023, the MRB rider reserve was $7 million higher than we expected after accounting for actual policyholder behavior. The unfavorable impact of this actual policyholder behavior was more than covered by the excess rider fees noted above. For our Legacy business, the impact on our GAAP earnings from policyholder behavior was $21 million, which was largely absorbed by our reinsurance treaty with Venerable and other reinsurers. The net loss of $3 million that was not absorbed by reinsurance was covered by our base contract fees.

“Changes in future economic assumptions” represents the impact from interest rates on the MRB balance. These fluctuations are offset through our interest rate hedging program which is reflected partially in GAAP Net Income with the remainder reflected in OCI.

Macroeconomic and Industry Trends

Our business and consolidated results of operations are significantly affected by economic conditions and consumer confidence, conditions in the global capital markets and the interest rate environment.

82

Financial and Economic Environment

A wide variety of factors continue to impact financial and economic conditions. These factors include, among others, concerns over increased volatility in the capital markets, equity market declines, rising interest rates, inflationary pressures, plateauing or decreasing economic growth, high fuel and energy costs, changes in fiscal or monetary policy and geopolitical tensions. Market volatility, particularly during March 2023, was driven by instability in the banking sector following continued interest rate increases by the U.S. Federal Reserve, as a run on some mid-size U.S. banks resulted in regulatory intervention, including the guarantee of all deposits by the FDIC. The ongoing military conflict between the Ukraine and Russia and the sanctions and other measures imposed in response to this conflict also continue to contribute to geopolitical tensions and market volatility.

Stressed conditions, volatility and disruptions in the capital markets, particular markets, or financial asset classes can have an adverse effect on us, in part because we have a large investment portfolio. In addition, our insurance liabilities and derivatives are sensitive to changing market factors, including equity market performance and interest rates, which continued to rise during the first quarter 2023. An increase in market volatility could continue to affect our business, including through effects on the yields we earn on invested assets, changes in required reserves and capital and fluctuations in the value of our AUM, AV or AUA from which we derive our fee income. These effects could be exacerbated by uncertainty about future fiscal policy, changes in tax policy, the scope of potential deregulation and levels of global trade.

The potential for increased volatility could pressure sales and reduce demand for our products as consumers consider purchasing alternative products to meet their objectives. In addition, this environment could make it difficult to consistently develop products that are attractive to customers. Financial performance can be adversely affected by market volatility and equity market declines as fees driven by AV and AUM fluctuate, hedging costs increase and revenues decline due to reduced sales and increased outflows.

We monitor the behavior of our customers and other factors, including mortality rates, morbidity rates, annuitization rates and lapse and surrender rates, which change in response to changes in capital market conditions, to ensure that our products and solutions remain attractive and profitable. For additional information on our sensitivity to interest rates and capital market prices, see “Quantitative and Qualitative Disclosures About Market Risk” in the 2022 Form 10-K.

Regulatory Developments

Our life insurance subsidiaries are regulated primarily at the state level, with some policies and products also subject to federal regulation. In addition, Holdings and its insurance subsidiaries are subject to regulation under the insurance holding company laws of various U.S. jurisdictions. Furthermore, on an ongoing basis, regulators refine capital requirements and introduce new reserving standards. Regulations recently adopted or currently under review can potentially impact our statutory reserve, capital requirements and profitability of the industry and result in increased regulation and oversight for the industry.

The NAIC is evaluating the appropriate accounting treatment of an insurer’s negative interest maintenance reserve (“IMR”) balance, since a rising interest rate environment may cause an insurer’s IMR balance to become negative as a result of bond sales executed at a capital loss. If this occurs, current statutory accounting guidance requires the non-admittance of negative IMR, which can impact an insurer’s surplus and financial strength reflected in its financial statements and result in lower reported surplus and RBC ratios. The NAIC has exposed new statutory accounting guidance that would permit an insurer with an RBC greater than 300% to admit negative IMR up to 5% of its general account capital and surplus, subject to certain restrictions and reporting obligations. Comments on the proposal are due in June 2023. The NAIC is focused on identifying an interim solution for year-end 2023 statutory reporting, although it also intends to develop a long-term solution even if interest rates change.

The NAIC is also evaluating the risks associated with insurers’ investments in certain categories of structured securities, including CLOs. In March 2023, the NAIC adopted an amendment to the Purposes and Procedures Manual to give the NAIC’s Structured Securities Group, housed within the SVO, responsibility for modeling CLO securities and evaluating tranche level losses across all debt and equity tranches under a series of calibrated and weighted collateral stress scenarios in order to assign NAIC designations. Under the amended Purposes and Procedures Manual, which will become effective no earlier than year-end 2024 financial reporting, CLO investments will no longer be broadly exempt from filing with the SVO based on ratings from Credit Rating Providers. The NAIC’s goal is to ensure that the weighted average RBC factor for owning all tranches of a CLO more closely aligns with what would be required for directly owning all of the underlying loan collateral, in order to avoid RBC arbitrage. The NAIC is collaborating with interested parties to develop and refine the process for modeling CLO investments.

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The NAIC has also proposed an interim change to their RBC requirement for equity tranches of all securitizations, including CLOs. If adopted, this would increase the capital charge for these equity tranches from 30% to 45%. This proposal remains subject to comment from regulators, insurance companies, and other interested parties and thus may still be revised or delayed. An interim charge will likely have to be approved by June 30 for it to be effective for year-end 2023 statutory filings. The interim charge is intended to remain in effect until the NAIC finalizes and adopts its modeling framework for CLOs which is not expected to be completed until at least year-end 2024.

In March 2023, the Securities and Exchange Commission (SEC) reopened the comment period for the Investment Management Cybersecurity Release proposing new rules under the Investment Advisers Act of 1940 and the Investment Company Act of 1940 that would require registered investment advisers and investment companies to adopt and implement written cybersecurity policies and procedures reasonably designed to: (1) address cybersecurity risk management, (2) disclose information about cybersecurity risks and incidents, (3) report information confidentially to the SEC about certain cybersecurity incidents, and (4) maintain related records.

In addition, in March 2023, the SEC proposed rule amendments that would require brokers and dealers, investment companies, and investment advisers registered with the SEC to adopt written policies and procedures for incident response programs to address unauthorized access to or use of customer information, including procedures for providing timely notification to individuals affected by an incident involving sensitive customer information with details about the incident and information designed to help affected individuals respond appropriately. The proposal also would broaden the scope of information covered by amending requirements for safeguarding customer records and information, and for properly disposing of consumer report information, as well as impose requirements to maintain written records documenting compliance with the proposed amended rules. Finally, the proposed amendments would conform annual privacy notice delivery provisions to the terms of an exception provided by a statutory amendment to the Gramm-Leach-Bliley Act.

Finally, in March 2023, the SEC proposed a new rule and form and amendments to existing recordkeeping rules to require broker-dealers, clearing agencies, major security-based swap participants, the Municipal Securities Rulemaking Board, national securities associations, national securities exchanges, security-based swap data repositories, security-based swap dealers, and transfer agents to address cybersecurity risks through: (1) policies and procedures, (2) immediate notification to the SEC of the occurrence of a significant cybersecurity incident, (3) as applicable, reporting detailed information to the SEC about a significant cybersecurity incident, and (4) public disclosures with respect to cybersecurity risks and significant cybersecurity incidents.

The public comment period for this proposed rule will end in May 2023. We cannot predict what form the final new or amended rules may take, or what affect such developments in the law may have on our business or compliance costs. For additional information on regulatory developments and the risks we face, see “Business—Regulation” and “Risk Factors—Legal and Regulatory Risks” in the 2022 Form 10-K.

Revenues

Our revenues come from three principal sources:

•fee income derived from our retirement and protection products and our investment management and research services;

•premiums from our traditional life insurance and annuity products; and

•investment income from our General Account investment portfolio.

Our fee income varies directly in relation to the amount of the underlying AV or benefit base of our retirement and protection products and the amount of AUM of our Investment Management and Research business. AV and AUM, each as defined in “Key Operating Measures,” are influenced by changes in economic conditions, primarily equity market returns, as well as net flows. Our premium income is driven by the growth in new policies written and the persistency of our in-force policies, both of which are influenced by a combination of factors, including our efforts to attract and retain customers and market conditions that influence demand for our products. Our investment income is driven by the yield on our General Account investment portfolio and is impacted by the prevailing level of interest rates as we reinvest cash associated with maturing investments and net flows to the portfolio.

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Benefits and Other Deductions

Our primary expenses are:

•    policyholders’ benefits and interest credited to policyholders’ account balances;

•    sales commissions and compensation paid to intermediaries and advisors that distribute our products and services; and

•    compensation and benefits provided to our employees and other operating expenses.

Policyholders’ benefits are driven primarily by mortality, customer withdrawals, and benefits which change in response to changes in capital market conditions. In addition, some of our policyholders’ benefits are directly tied to the AV and benefit base of our variable annuity products. Interest credited to policyholders varies in relation to the amount of the underlying AV or benefit base. Sales commissions and compensation paid to intermediaries and advisors vary in relation to premium and fee income generated from these sources, whereas compensation and benefits to our employees are more constant and impacted by market wages and decline with increases in efficiency. Our ability to manage these expenses across various economic cycles and products is critical to the profitability of our company.

Net Income Volatility

We have offered and continue to offer variable annuity products with GMxB features. The future claims exposure on these features is sensitive to movements in the equity markets and interest rates. Accordingly, we have implemented hedging and reinsurance programs designed to mitigate the economic exposure to us from these features due to equity market and interest rate movements. Changes in the values of the derivatives associated with these programs due to equity market and interest rate movements, together with the GMxB MRBs assets and liabilities are recognized in the periods in which they occur. This results in net income volatility as further described below. In addition net income is impacted by changes in our reinsurers credit spread, while changes in the Company's credit spread is recorded in other comprehensive income. See “—Significant Factors Impacting Our Results—Impact of Hedging and GMIB Reinsurance on Results.”

In addition to our dynamic hedging strategy, we have static hedge positions designed to mitigate the adverse impact of changing market conditions on our statutory capital. We believe this program will continue to preserve the economic value of our variable annuity contracts and better protect our target variable annuity asset level. However, these static hedge positions increase the size of our derivative positions and may result in net income volatility on a period-over-period basis.

Due to the impacts on our net income of equity market and interest rate movements and other items that are not part of the underlying profitability drivers of our business, we evaluate and manage our business performance using Non-GAAP Operating Earnings, a non-GAAP financial measure that is intended to remove these impacts from our results. See “—Key Operating Measures—Non-GAAP Operating Earnings. ”

Significant Factors Impacting Our Results

The following significant factors have impacted, and may in the future impact, our financial condition, results of operations or cash flows.

Impact of Hedging and GMxB Reinsurance on Results

We have offered and continue to offer variable annuity products with GMxB features. The future claims exposure on these features is sensitive to movements in the equity markets and interest rates. Accordingly, we have implemented hedging and reinsurance programs designed to mitigate the economic exposure to us from these features due to equity market and interest rate movements. These programs include:

•Variable annuity hedging programs. We use a dynamic hedging program (within this program, generally, we reevaluate our economic exposure at least daily and rebalance our hedge positions accordingly) to mitigate certain risks associated with the GMxB features that are embedded in our liabilities for our variable annuity products. This program utilizes various derivative instruments that are managed in an effort to reduce the economic impact of unfavorable changes in GMxB features’ exposures attributable to movements in the equity markets and interest rates. Although this program is designed to provide a measure of economic protection against the impact of adverse market conditions, it does not qualify for hedge accounting treatment. Accordingly, changes in value of the derivatives will be recognized in the period in which they occur with offsetting changes in reserves recognized in the current period. In addition, we utilize AFS fixed maturity securities in our General Account to mitigate the economic impact unfavorable

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changes in GMxB features’ exposures attributable to movements in interest rates. However, the economic effect of interest rate changes on such securities is reflected in OCI, which results in net income volatility as the economic effect of interest rates on our GMxB MRB liabilities is reflected in net income.

•In addition to our dynamic hedging program, we have a hedging program using static hedge positions (derivative positions intended to be held-to-maturity with less frequent re-balancing) to protect our statutory capital against stress scenarios. This program, in addition to our dynamic hedge program, has increased the size of our derivative positions, resulting in additional net income volatility. The impacts are most pronounced for variable annuity products.

•GMxB reinsurance contracts. Historically, GMxB reinsurance contracts were used to cede to non-affiliated reinsurers a portion of our exposure to variable annuity products that offer a GMxB feature. We account for the reinsurance contracts as MRBs and report them at fair value. In addition, on June 1, 2021, we ceded legacy variable annuity policies sold by Equitable Financial between 2006-2008 (the “Block”), comprised of non-New York “Accumulator” policies containing fixed rate GMIB and/or GMDB guarantees.

Effect of Assumption Updates on Operating Results

During the third quarter of each year, we conduct our annual review of the assumptions underlying the valuation of DAC, deferred sales inducement assets, unearned revenue liabilities, liabilities for future policyholder benefits and market risk benefits for our Individual Retirement, Group Retirement, and Protection Solutions, and Legacy segments (assumption reviews are not relevant for the Investment Management and Research and Wealth Management segments). Assumptions are based on a combination of Company experience, industry experience, management actions and expert judgment and reflect our best estimate as of the date of the applicable financial statements.

Most of the variable annuity products, variable universal life insurance and universal life insurance products we offer maintain policyholder deposits that are reported as liabilities and classified within either Separate Accounts liabilities or policyholder account balances. Our products and riders also impact liabilities for future policyholder benefits, market risk benefits and unearned revenues and assets for DAC and DSI. The valuation of these assets and liabilities (other than deposits) is based on differing accounting methods depending on the product, each of which requires numerous assumptions and considerable judgment. The accounting guidance applied in the valuation of these assets and liabilities includes, but is not limited to, the following: (i) traditional life insurance products for which assumptions are updated annually to estimate the value of future death, morbidity or income benefits; (ii) universal life insurance and variable life insurance secondary guarantees for which benefit liabilities are determined by estimating the expected value of death benefits payable when the account balance is projected to be zero and recognizing those benefits ratably over the accumulation period based on total expected assessments; (iii) certain product guarantees reported as market risk benefits at fair value; and (iv) certain product guarantees reported as embedded derivatives at fair value.

For further details of our accounting policies and related judgments pertaining to assumption updates, see Note 2 of the Notes to the Consolidated Financial Statements and “—Summary of Critical Accounting Estimates—Liability for Future Policy Benefits” included in the 2022 Form 10-K.

Productivity Strategies

Retirement and Protection Businesses

As part of our continuing efforts to drive productivity improvements, in January 2021, we began a new program expected to achieve $80 million of targeted run-rate expense savings by 2023, of which $60 million has been achieved as of March 31, 2023. We expect to achieve these savings by shifting our workforce into an agile working model, leveraging technology-enabled capabilities, optimizing our real estate footprint, and continuing to realize a portion of COVID-19 related savings.

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Key Operating Measures

In addition to our results presented in accordance with U.S. GAAP, we report Non-GAAP Operating Earnings, Non-GAAP Operating ROE, and Non-GAAP operating common EPS, each of which is a measure that is not determined in accordance with U.S. GAAP. Management principally uses these non-GAAP financial measures in evaluating performance because they present a clearer picture of our operating performance and they allow management to allocate resources. Similarly, management believes that the use of these Non-GAAP financial measures, together with relevant U.S. GAAP measures, provide investors with a better understanding of our results of operations and the underlying profitability drivers and trends of our business. These non-GAAP financial measures are intended to remove from our results of operations the impact of market changes (where there is mismatch in the valuation of assets and liabilities) as well as certain other expenses which are not part of our underlying profitability drivers or likely to re-occur in the foreseeable future, as such items fluctuate from period-to-period in a manner inconsistent with these drivers. These measures should be considered supplementary to our results that are presented in accordance with U.S. GAAP and should not be viewed as a substitute for the U.S. GAAP measures. Other companies may use similarly titled non-GAAP financial measures that are calculated differently from the way we calculate such measures. Consequently, our non-GAAP financial measures may not be comparable to similar measures used by other companies.

We also discuss certain operating measures, including AUM, AUA, AV, Protection Solutions Reserves and certain other operating measures, which management believes provide useful information about our businesses and the operational factors underlying our financial performance.

Non-GAAP Operating Earnings

Non-GAAP Operating Earnings is an after-tax non-GAAP financial measure used to evaluate our financial performance on a consolidated basis that is determined by making certain adjustments to our consolidated after-tax net income attributable to Holdings. The most significant of such adjustments relates to our derivative positions, which protect economic value and statutory capital, and the variable annuity product MRBs. This is a large source of volatility in net income.

Non-GAAP Operating Earnings equals our consolidated after-tax net income attributable to Holdings adjusted to eliminate the impact of the following items:

•Items related to variable annuity product features, which include: (i) changes in the fair value of market risk benefits and purchased market risk benefits, including the related attributed fees and claims, offset by derivatives and other securities used to hedge the market risk benefits which result in residual net income volatility as the change in fair value of certain securities is reflected in OCI and due to our statutory capital hedge program; and (ii) market adjustments to deposit asset or liability accounts arising from reinsurance agreements which do not expose the reinsurer to a reasonable possibility of a significant loss from insurance risk;

•Investment (gains) losses, which includes credit loss impairments of securities/investments, sales or disposals of securities/investments, realized capital gains/losses and valuation allowances;

•Net actuarial (gains) losses, which includes actuarial gains and losses as a result of differences between actual and expected experience on pension plan assets or projected benefit obligation during a given period related to pension, other postretirement benefit obligations, and the one-time impact of the settlement of the defined benefit obligation;

•Other adjustments, which primarily include restructuring costs related to severance and separation, lease write-offs related to non-recurring restructuring activities, COVID-19 related impacts, net derivative gains (losses) on certain Non-GMxB derivatives, net investment income from certain items including consolidated VIE investments, seed capital mark-to-market adjustments, unrealized gain/losses and realized capital gains/losses from sales or disposals of select securities, certain legal accruals; and a bespoke deal to repurchase UL policies from one entity that had invested in numerous policies purchased in the life settlement market, which disposed of the risk of additional COI litigation by that entity related to those UL policies; and

•Income tax expense (benefit) related to the above items and non-recurring tax items, which includes the effect of uncertain tax positions for a given audit period, and a decrease of a deferred tax valuation allowance.

Because Non-GAAP Operating Earnings excludes the foregoing items that can be distortive or unpredictable, management believes that this measure enhances the understanding of the Company’s underlying drivers of profitability and trends in our business, thereby allowing management to make decisions that will positively impact our business.

We use the prevailing corporate federal income tax rate of 21% while taking into account any non-recurring differences for events recognized differently in our financial statements and federal income tax returns as well as partnership income taxed at lower rates when reconciling Net income (loss) attributable to Holdings to Non-GAAP Operating Earnings.

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The table below presents a reconciliation of net income (loss) attributable to Holdings to Non-GAAP Operating Earnings for the three months ended March 31, 2023 and 2022:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Net income (loss) attributable to Holdings	$	177	$	530
Adjustments related to:
Variable annuity product features	861		(616)
Investment (gains) losses	87		326
Net actuarial (gains) losses related to pension and other postretirement benefit obligations	9		19
Other adjustments (1)	45		228
Income tax expense (benefit) related to above adjustments	(210)		9
Non-recurring tax items (2)	(605)		3
Non-GAAP Operating Earnings	$	364	$	499

______________

(1)Includes certain legal accruals to the cost of insurance litigation of $59 million for the three months ended March 31, 2022. Includes policyholder benefit costs of $75 million for the three months ended March 31, 2022 stemming from a deal to repurchase UL policies from one entity that had invested in numerous policies purchased in the life settlement market.

(2)For the three months ended March, 31 2023, non-recurring tax items reflects the effect of uncertain tax positions for a given audit period and a decrease of a deferred tax valuation allowance.

Non-GAAP Operating ROE

We calculate Non-GAAP Operating ROE by dividing Non-GAAP Operating Earnings for the previous twelve calendar months by consolidated average equity attributable to Holdings’ common shareholders, excluding AOCI. AOCI fluctuates period-to-period in a manner inconsistent with our underlying profitability drivers as the majority of such fluctuation is related to the market volatility of the unrealized gains and losses associated with our AFS securities. Therefore, we believe excluding AOCI is more effective for analyzing the trends of our operations.

The following table presents return on average equity attributable to Holdings’ common shareholders, excluding AOCI and Non-GAAP Operating ROE for the trailing twelve months ended March 31, 2023.

	Trailing Twelve Months Ended March 31, 2023
	(Dollars in millions)
Net income (loss) available to Holdings’ common shareholders	$	1,720
Average equity attributable to Holdings’ common shareholders, excluding AOCI	$	8,641
Return on average equity attributable to Holdings’ common shareholders, excluding AOCI	19.9		%
Non-GAAP Operating Earnings available to Holdings’ common shareholders	$	1,511
Average equity attributable to Holdings’ common shareholders, excluding AOCI	$	8,641
Non-GAAP Operating ROE	17.5		%

Non-GAAP Operating Common EPS

Non-GAAP operating common EPS is calculated by dividing Non-GAAP Operating Earnings by diluted common shares outstanding. The following table sets forth Non-GAAP operating common EPS for the three months ended March 31, 2023 and 2022.

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	Three Months Ended March 31,
	2023		2022
	(per share amounts)
Net income (loss) attributable to Holdings (1)	$	0.49	$	1.35
Less: Preferred stock dividends	0.04		0.04
Net income (loss) available to Holdings’ common shareholders	0.45		1.31
Adjustments related to:
Variable annuity product features	2.36		(1.57)
Investment (gains) losses	0.24		0.83
Net actuarial (gains) losses related to pension and other postretirement benefit obligations	0.02		0.05
Other adjustments (2) (3)	0.13		0.58
Income tax expense (benefit) related to above adjustments	(0.58)		0.02
Non-recurring tax items (4)	(1.66)		0.01
Non-GAAP operating common EPS	$	0.96	$	1.23

______________

(1)For periods presented with a net loss, basic shares are used for EPS.

(2)Includes certain gross legal expenses related to the cost of insurance litigation and claims related to a commercial relationship of $0.00 and $0.15 for the three months ended March 31, 2023 and 2022, respectively. Includes policyholder benefit costs of $0.00 and $0.19 for the three months ended March 31, 2023 and 2022 stemming from a deal to repurchase UL policies from one entity that had invested in numerous policies purchased in the life settlement market.

(3)Includes Non-GMxB related derivative hedge losses of $0.01 and $(0.01) for the three months ended March 31, 2023 and 2022, respectively.

(4)For the three months ended March, 31 2023, non-recurring tax items reflects the effect of uncertain tax positions for a given audit period and a decrease of a deferred tax valuation allowance.

Assets Under Management

AUM means investment assets that are managed by one of our subsidiaries and includes: (i) assets managed by AB; (ii) the assets in our General Account investment portfolio; and (iii) the Separate Accounts assets of our Individual Retirement, Group Retirement and Protection Solutions businesses. Total AUM reflects exclusions between segments to avoid double counting.

Assets Under Administration

AUA includes non-insurance client assets that are invested in our savings and investment products or serviced by our Equitable Advisors platform. We provide administrative services for these assets and generally record the revenues received as distribution fees.

Account Value

AV generally equals the aggregate policy account value of our retirement products. General Account AV refers to account balances in investment options that are backed by the General Account while Separate Accounts AV refers to Separate Accounts investment assets.

Protection Solutions Reserves

Protection Solutions Reserves equals the aggregate value of policyholders’ account balances and future policy benefits for policies in our Protection Solutions segment.

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Consolidated Results of Operations

Our consolidated results of operations are significantly affected by conditions in the capital markets and the economy because we offer market sensitive products. These products have been a significant driver of our results of operations. Because the future claims exposure on these products is sensitive to movements in the equity markets and interest rates, we have in place various hedging and reinsurance programs that are designed to mitigate the economic risk of movements in the equity markets and interest rates. The volatility in net income attributable to Holdings for the periods presented below results from the mismatch between: (i) the change in carrying value of the reserves for GMDB and certain GMIB features that do not fully and immediately reflect the impact of equity and interest market fluctuations; (ii) the change in fair value of products with the GMIB feature that have a no-lapse guarantee; and (iii) our hedging and reinsurance programs.

Ownership and Consolidation of AllianceBernstein

Our indirect, wholly-owned subsidiary, AllianceBernstein Corporation, is the General Partner of AB. Accordingly, AB’s results are fully reflected in our consolidated financial statements. For additional information on our economic interest in AB, see Note 1 of the Notes to the Consolidated Financial Statements.

Consolidated Results of Operations

The following table summarizes our consolidated statements of income (loss) for the three months ended March 31, 2023 and 2022:

Consolidated Statement of Income (Loss)

	Three Months Ended March 31,
	2023		2022
	(in millions, except per share data)
REVENUES
Policy charges and fee income	$	588	$	650
Premiums	276		247
Net derivative gains (losses)	(841)		159
Net investment income (loss)	990		804
Investment gains (losses), net:
Credit losses on available-for-sale debt securities and loans	(66)		10
Other investment gains (losses), net	(21)		(336)
Total investment gains (losses), net	(87)		(326)
Investment management and service fees	1,180		1,355
Other income	251		257
Total revenues	2,357		3,146
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	730		802
Remeasurement of liability for future policy benefits	4		22
Change in market risk benefits and purchased market risk benefits	20		(467)
Interest credited to policyholders’ account balances	463		313
Compensation and benefits	583		596
Commissions and distribution-related payments	380		422
Interest expense	61		47
Amortization of deferred policy acquisition costs	152		143
Other operating costs and expenses	423		534
Total benefits and other deductions	2,816		2,412
Income (loss) from continuing operations, before income taxes	(459)		734
Income tax (expense) benefit	725		(137)
Net income (loss)	266		597
Less: Net income (loss) attributable to the noncontrolling interest	89		67
Net income (loss) attributable to Holdings	177		530
Less: Preferred stock dividends	14		14

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	Three Months Ended March 31,
	2023		2022
	(in millions, except per share data)
Net income (loss) available to Holdings’ common shareholders	$	163	$	516
EARNINGS PER COMMON SHARE
Net income (loss) applicable to Holdings’ common shareholders per common share:
Basic	$	0.45	$	1.33
Diluted	$	0.45	$	1.32
Weighted average common shares outstanding (in millions):
Basic	361.9		388.6
Diluted	364.1		391.7

	Three Months Ended March 31,
	2023		2022
	(in millions)
Non-GAAP Operating Earnings	$	364	$	499

The following table summarizes our Non-GAAP Operating Earnings per common share for the three months ended March 31, 2023, and 2022:

	Three Months Ended March 31,
	2023		2022
Non-GAAP operating earnings per common share:
Basic	$	0.97	$	1.25
Diluted	$	0.96	$	1.24

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Three Months Ended March 31, 2023 Compared to the Three Months Ended March 31, 2022

Net Income (Loss) Attributable to Holdings

Net income attributable to Holdings decreased by $353 million to a net income of $177 million for the three months ended March 31, 2023 from a net income of $530 million for the three months ended March 31, 2022. The following notable items were the primary drivers for the change in net income (loss):

Unfavorable items included:

•Net derivative gains decreased $1.0 billion from a $159 million gain in last quarter of the prior year driven by equity market appreciation during first quarter 2023 compared to equity market depreciation during first quarter 2022, partially offset by a decrease in interest rates during first quarter 2023 compared to an increase during the first quarter of 2022.

•Change in market risk benefits and purchased market risk benefits increased by $487 million mainly due to a decrease in interest rates during first quarter 2023 compared to an increase during first quarter 2022, partially offset by equity market depreciation during first quarter 2022.

•Fee-type revenue decreased by $214 million mainly driven by lower fees from our Investment Management and Research segment primarily driven by lower average AUM, and lower fees from our Individual Retirement segment as a result of lower average Separate Accounts AV due to lower equity markets.

•Interest credited to policyholders’ account balances increased by $150 million mainly due to increased interest rates and average outstanding amounts of funding agreements in Corporate and Other and higher interest crediting rate on SCS due to a higher interest rate environment and growth of SCS AV in our Individual Retirement segment, partially offset by the impact of the Global Atlantic Transaction in our Group Retirement segment.

•Net income attributable to noncontrolling interest increased by $22 million mainly due to gains from AB’s consolidated VIEs partially offset by lower AB pre-tax income.

These were partially offset by the following favorable items:

•Investment gains increased by $239 million mainly due to rebalancing in the General Account portfolio associated with the duration program during first quarter 2022.

•Net investment income increased by $186 million mainly due to higher General Account assets, higher yields and higher income from seed capital investments partially offset by lower alternative investment income and lower prepayment income.

•Compensation, benefits and other operating expenses decreased by $124 million mainly due to lower general and administrative costs, primarily relating to lower portfolio servicing fees and professional fees, lower legal accruals, lower compensation expense, and lower COLI expenses due to market conditions partially offset by an increase in our Protection Solutions segment due to the non-repeat of a litigation reserve release in the three months ended March 31, 2022.

•Policyholders’ benefits decreased by $72 million mainly due to higher benefits in the first quarter 2022 from a transaction to repurchase UL policies from one entity that had invested in numerous purchased in the life settlement market during 2022.

•Commissions and distribution-related payments decreased by $42 million mainly due to lower payments to financial intermediaries for the distribution of AB mutual funds in our Investment Management and Research segment and lower average Separate Accounts AV in our Legacy Segment as result of lower equity markets and net outflows gross of reinsurance.

•Income tax benefit of $725 million for the three months ended March 31, 2023 compared to income tax expense of $137 million for the three months ended March 31, 2022 primarily related to a partial release of the valuation allowance of $614 million on the deferred tax asset, and a pre-tax loss for the first quarter 2023 compared to pre-tax income for the first quarter 2022.

See “—Significant Factors Impacting Our Results—Effect of Assumption Updates on Operating Results” for more information regarding assumption updates.

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Non-GAAP Operating Earnings

Non-GAAP Operating Earnings decreased by $135 million to $364 million for the three months ended March 31, 2023 from $499 million in the three months ended March 31, 2022. The following notable items were the primary drivers for the change in Non-GAAP Operating Earnings.

Unfavorable items included:

•Fee-type revenue decreased by $201 million mainly driven by lower fees primarily from our Investment Management and Research segment driven by lower average AUM, and lower fees from our Individual Retirement segment as a result of lower average Separate Accounts AV due to lower equity markets.

•Interest credited to policyholders’ account balances increased by $150 million mainly due to increased interest rates and average outstanding amounts of funding agreements in Corporate and Other and higher interest crediting rate on SCS due to a higher interest rate environment and growth of SCS AV in our Individual Retirement segment, partially offset by the impact of the policies ceded from the Global Atlantic Transaction in our Group Retirement segment.

•Net derivative gains decreased $32 million from a $12 million gain primarily from our Investment Management and Research segment driven by higher losses from economically hedging the seed capital investments.

These were partially offset by the following favorable items:

•Net investment income increased by $102 million mainly due to higher General Account assets, higher yields and higher income from seed capital investments partially offset by lower alternative investment income and lower prepayment income.

•Compensation, benefits and other operating costs and expenses decreased by $67 million mainly due to lower general and administrative costs, primarily relating to lower portfolio servicing fees and professional fees, and lower compensation expense and lower COLI expenses due to market conditions partially offset by an increase in our Protection Solutions segment due to the non-repeat of a litigation reserve release in the three months ended March 31, 2022.

•Commissions and distribution-related payments decreased by $42 million mainly due to lower payments to financial intermediaries for the distribution of AB mutual funds in our Investment Management and Research segment.

•Income tax expense decreased by $34 million mainly driven by lower pre-tax earnings.

Results of Operations by Segment

As previously announced, effective January 1, 2023, our financial reporting presentation was revised to reflect the reorganization of the Company’s reportable segments to reflect how the Company’s chief operating decision maker now makes operating decisions and assesses performance. We now have six reportable segments. Prior period results have been revised in connection with updates to our reportable segments.

We manage our business through the following six segments: Individual Retirement, Group Retirement, Investment Management and Research, Protection Solutions, Wealth Management and Legacy. We report certain activities and items that are not included in our four segments in Corporate and Other. The following section presents our discussion of operating earnings (loss) by segment and AUM, AV and Protection Solutions Reserves by segment, as applicable. Consistent with U.S. GAAP guidance for segment reporting, operating earnings (loss) is our U.S. GAAP measure of segment performance. See Note 17 of the Notes to the Consolidated Financial Statements for further information on our segments.

The following table summarizes operating earnings (loss) on our segments and Corporate and Other for the three months ended March 31, 2023 and 2022:

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	Three Months Ended March 31,
	2023		2022
	(in millions)
Operating earnings (loss) by segment:
Individual Retirement	$	200	$	203
Group Retirement	89		144
Investment Management and Research	99		136
Protection Solutions	(35)		(3)
Wealth Management	32		32
Legacy	60		63
Corporate and Other	(81)		(76)
Non-GAAP Operating Earnings	$	364	$	499

Effective Tax Rates by Segment

Income tax expense is calculated using the ETR and then allocated to our business segments using a 16% ETR for our retirement and protection businesses (Individual Retirement, Group Retirement, Protection Solutions and Legacy), a 25% ETR for Wealth Management and a 27% ETR for Investment Management and Research.

Individual Retirement

The Individual Retirement segment includes our variable annuity products which primarily meet the needs of individuals saving for retirement or seeking retirement income.

The following table summarizes operating earnings of our Individual Retirement segment for the periods presented:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Operating earnings	$	200	$	203

94

Key components of operating earnings are:

	Three Months Ended March 31,
	2023		2022
	(in millions)
REVENUES
Policy charges, fee income and premiums	$	163	$	183
Net investment income	340		236
Net derivative gains (losses)	(5)		(8)
Investment management, service fees and other income	90		96
Segment revenues	$	588	$	507
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	$	24	$	18
Remeasurement of liability for future policy benefits	1		—
Interest credited to policyholders’ account balances	129		60
Commissions and distribution-related payments	60		64
Amortization of deferred policy acquisition costs	89		80
Compensation, benefits and other operating costs and expenses	47		41
Interest expense	—		—
Segment benefits and other deductions	$	350	$	263

The following table summarizes AV for our Individual Retirement segment as of the dates indicated:

	March 31, 2023		December 31, 2022
	(in millions)
AV (1)
General Account	$	41,166	$	37,822
Separate Accounts	37,634		36,455
Total AV	$	78,800	$	74,277

(1)AV presented are net of reinsurance.

The following table summarizes a roll-forward of AV for our Individual Retirement segment for the periods presented:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Balance as of beginning of the period	$	74,277	$	82,629
Gross premiums	2,871		2,801
Surrenders, withdrawals and benefits	(1,939)		(2,136)
Net flows	932		665
Investment performance, interest credited and policy charges	3,584		(3,682)
Other (1)	7		—
Balance as of end of the period	$	78,800	$	79,612

______________

(1)For the three months ending March 31, 2023, amounts reflect a total special payment applied to the accounts of active clients as part of a previously disclosed settlement agreement between Equitable Financial and the SEC.

95

Three Months Ended March 31, 2023 Compared to the Three Months Ended March 31, 2022 for the Individual Retirement Segment

Operating earnings

Operating earnings decreased $3 million to $200 million during the three months ended March 31, 2023 from $203 million in the three months ended March 31, 2022. The following notable items were the primary drivers of the change in operating earnings:

Unfavorable items included:

•Interest credited to policyholders’ account balances increased by $69 million mainly due to higher interest crediting rate on SCS due to the higher interest rate environment and the growth of SCS AV.

•Fee-type revenue decreased by $26 million mainly due to lower average Separate Accounts AV as a result of lower equity markets.

•Amortization of DAC increased by $9 million mainly due to continued growth in SCS.

These were partially offset by the following favorable items:

•Net investment income increased by $104 million mainly due to higher SCS asset balances and higher yields, partially offset by lower income on alternative investments and lower prepayment income.

Net Flows and AV

•The increase in AV of $4.5 billion in the three months ended March 31, 2023 was driven by an increase in investments performance and interest credited to account balances, net of policy charges, of $3.6 billion as a result of equity market appreciation in the first quarter of 2023, as well as net inflows of $932 million.

•Net inflows of $932 million were $267 million higher than in the three months ended March 31, 2022, mainly driven by lower outflows due to lower account values in the first quarter of 2023 as compared to the first quarter of 2022, as well as higher sales in the first quarter of 2023 as compared to the first quarter of 2022.

Group Retirement

The Group Retirement segment offers tax-deferred investment and retirement services or products to plans sponsored by educational entities, municipalities and not-for-profit entities, as well as small and medium-sized businesses.

The following table summarizes operating earnings of our Group Retirement segment for the periods presented:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Operating earnings	$	89	$	144

Key components of operating earnings are:

	Three Months Ended March 31,
	2023		2022
	(in millions)
REVENUES
Policy charges, fee income and premiums	$	64	$	94
Net investment income	112		180
Net derivative (losses) gains	(1)		(5)
Investment management, service fees and other income	62		66
Segment revenues	$	237	$	335

96

	Three Months Ended March 31,
	2023		2022
	(in millions)
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	$	—	$	—
Remeasurement of liability for future policy benefits	—		—
Interest credited to policyholders’ account balances	50		78
Commissions and distribution-related payments	37		42
Amortization of deferred policy acquisition costs	15		15
Compensation, benefits and other operating costs and expenses	29		28
Interest expense	—		—
Segment benefits and other deductions	$	131	$	163

The following table summarizes AV and AUA for our Group Retirement segment as of the dates indicated:

	March 31, 2023		December 31, 2022
	(in millions)
AV and AUA
General Account	$	9,133	$	9,175
Separate Accounts and Mutual Funds	24,434		22,830
Total AV and AUA (2)	$	33,567	$	32,005

____________

(1)    AV presented are net of reinsurance.

The following table summarizes a roll-forward of AV and AUA for our Group Retirement segment for the periods indicated:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Balance as of beginning of the period (1)	$	32,005	$	47,809
Gross premiums	898		1,502
Surrenders, withdrawals and benefits	(868)		(979)
Net flows (1)	30		523
Investment performance, interest credited and policy charges (1)	1,502		(2,297)
Ceded to Global Atlantic	—		—
Other (2)	30		—
Balance as of end of the period	$	33,567	$	46,035

____________

(1)For the three months ended March 31, 2023, net outflows of $180 million and investment performance, interest credited and policy charges of $400 million, respectively, are excluded as these amounts are related to ceded AV to Global Atlantic.

(2)     For the three months ending March 31, 2023, amounts reflect a total special payment applied to the accounts of active clients as part of a previously disclosed settlement agreement between Equitable Financial Life Insurance Company and the SEC.

97

Three Months Ended March 31, 2023 Compared to the Three Months Ended March 31, 2022 for the Group Retirement Segment

Operating earnings

Operating earnings decreased by $55 million to $89 million during the three months ended March 31, 2023 from $144 million during the three months ended March 31, 2022. The following notable items were the primary drivers of the change in operating earnings:

Unfavorable items included:

•Net investment income decreased by $68 million primarily due to lower assets from the Global Atlantic Transaction, lower alternative investment income and lower income from spread lending, partially offset by higher yields.

•Fee-type revenue decreased by $34 million due to lower average Separate Account AV from market depreciation and ceded assets from the Global Atlantic Transaction.

These were partially offset by the following favorable items:

•Interest credited to policyholders’ account balances decreased by $28 million mainly due to the portion of policies ceded from the Global Atlantic Transaction.

•Commissions and distribution-related payments decreased by $5 million mainly due to lower average account value.

•Income tax expense decreased by $11 million primarily driven by lower pre-ax earnings partially offset by a higher effective tax rate in 2023.

Net Flows and AV

•The increase in AV of $1.6 billion in the three months ended March 31, 2023 was primarily driven by an increase in investments performance and interest credited to account balances net of policy charges of $1.5 billion as a result of market appreciation.

•Net inflows of $30 million decreased $493 million compared to 2022, due to a large lump sum premium in our institutional market in 2022, partially offset by our corporate 401(k) market.

Investment Management and Research

The Investment Management and Research segment provides diversified investment management, research and related services to a broad range of clients around the world. Operating earnings (loss), net of tax, presented here represents our average economic interest in AB of approximately 61% and 65% during the three months ended March 31, 2023 and 2022.

	Three Months Ended March 31,
	2023		2022
	(in millions)
Operating earnings	$	99	$	136

Key components of operating earnings are:

	Three Months Ended March 31,
	2023		2022
	(in millions)
REVENUES
Net investment income (loss)	$	9	$	(23)
Net derivative gains (losses)	(10)		20
Investment management, service fees and other income	1,010		1,138
Segment revenues	$	1,009	$	1,135

98

	Three Months Ended March 31,
	2023		2022
	(in millions)
BENEFITS AND OTHER DEDUCTIONS
Commissions and distribution related payments	$	148	$	176
Compensation, benefits and other operating costs and expenses	623		675
Interest expense	14		—
Segment benefits and other deductions	$	785	$	851

Changes in AUM in the Investment Management and Research segment for the periods presented were as follows:

	Three Months Ended March 31,
	2023		2022
	(in billions)
Balance as of beginning of the period	$	646.4	$	778.6
Long-term flows
Sales/new accounts	25.6		40.9
Redemptions/terminations	(20.6)		(24.6)
Cash flow/unreinvested dividends	(4.2)		(4.9)
Net long-term inflows (outflows)	0.8		11.4
Market appreciation (depreciation)	28.7		(54.6)
Net change	29.5		(43.2)
Balance as of end of the period	$	675.9	$	735.4

Average AUM in the Investment Management and Research segment for the periods presented by distribution channel and investment services were as follows:

	Three Months Ended March 31,
	2023		2022
	(in billions)
Distribution Channel:
Institutions	$	304.6	$	331.6
Retail	252.0		301.5
Private Wealth	110.2		118.1
Total	$	666.8	$	751.2
Investment Service:
Equity Actively Managed	$	226.8	$	270.5
Equity Passively Managed (1)	55.9		67.5
Fixed Income Actively Managed – Taxable	195.3		236.2
Fixed Income Actively Managed – Tax-exempt	54.1		56.1
Fixed Income Passively Managed (1)	9.5		12.9
Alternatives/Multi-Asset Solutions (2)	125.2		108.0
Total	$	666.8	$	751.2

____________

(1)Includes index and enhanced index services.

(2)Includes certain multi-asset solutions and services not included in equity of fixed income services.

99

Three Months Ended March 31, 2023 Compared to the Three Months Ended March 31, 2022 for the Investment Management and Research Segment

Operating earnings

Operating earnings decreased $37 million to $99 million during the three months ended March 31, 2023 from $136 million in the three months ended March 31, 2022. The following notable items were the primary drivers of the change in operating earnings:

Unfavorable items included:

•Fee-type revenue decreased by $128 million primarily due to lower investment advisory base fees, performance based fees and Bernstein Research Services revenues. The decrease in investment advisory base fees was primarily driven by lower average AUM partially offset by a higher portfolio fee rate. The decrease in performance based fees was primarily due to lower performance fees earned on AB’s U.S. Real Estate Funds, partially offset by higher performance fees earned on AB’s Private Credit Fund and Global Opportunistic Credit Fund. The decrease in Bernstein Research Services revenues were primarily driven by significantly lower customer trading activity as a result of market conditions.

These were partially offset by the following favorable items:

•Compensation, benefits, interest expense and other operating costs decreased by $38 million mainly due to lower general and administrative costs, primarily relating to lower portfolio servicing fees and professional fees, and lower compensation expense, partially offset by higher interest expense related to higher average borrowings and interest rates.

•Commissions and distribution-related payments decreased by $28 million mainly due to lower payments to financial intermediaries for the distribution of AB mutual funds.

•Net investment income, net of derivative gains, was favorable by $2 million. Net investment income increased by $32 million mainly due to higher gains on the seed capital investments subject to market risk, offset by an increase in net derivative losses of $30 million mainly due to higher losses from economically hedging the seed capital investments.

•Earnings attributable to noncontrolling interest decreased by $13 million due to lower pre-tax earnings.

•Income tax expense decreased by $10 million due to lower pre-tax earnings partially offset by a higher effective tax rate in 2023.

Long-Term Net Flows and AUM

•Total AUM as of March 31, 2023 was $675.9 billion, up $29.5 billion, or 4.6%, compared to December 31, 2022. The increase was primarily as a result of market appreciation of $28.7 billion and net inflows of $0.8 billion. Private Wealth and Retail net inflows were $1.9 billion and $1.6 billion, respectively, partially offset by Institutional net outflows of $2.7 billion.

Protection Solutions

The Protection Solutions segment includes our life insurance and employee benefits businesses. We provide a targeted range of products aimed at serving the financial needs of our clients throughout their lives, including VUL, IUL and term life products. In 2015, we entered the employee benefits market and currently offer a suite of dental, vision, life, as well as short- and long-term disability insurance products to small and medium-size businesses.

In recent years, we have refocused our product offering and distribution towards less capital intensive, higher return accumulation and protection products. For example, in January 2021, we discontinued offering our most interest sensitive IUL product. We plan to improve our operating earnings over time through earnings generated from sales of our repositioned product portfolio and by proactively managing and optimizing our in-force book.

The following table summarizes operating earnings (loss) of our Protection Solutions segment for the periods presented:

100

	Three Months Ended March 31,
	2023		2022
	(in millions)
Operating earnings (loss)	$	(35)	$	(3)

Key components of operating earnings (loss) are:

	Three Months Ended March 31,
	2023		2022
	(in millions)
REVENUES
Policy charges, fee income and premiums	$	520	$	500
Net investment income	217		272
Net derivative (losses) gains	(2)		—
Investment management, service fees and other income	32		37
Segment revenues	$	767	$	809
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	$	535	$	550
Remeasurement of liability for future policy benefits	6		8
Interest credited to policyholders’ account balances	125		128
Commissions and distribution related payments	34		34
Amortization of deferred policy acquisition costs	29		29
Compensation, benefits and other operating costs and expenses	80		63
Interest expense	—		—
Segment benefits and other deductions	$	809	$	812

The following table summarizes Protection Solutions Reserves for our Protection Solutions segment as of the dates presented:

	March 31, 2023		December 31, 2022
	(in millions)
Protection Solutions Reserves (1)
General Account	$	18,137	$	18,237
Separate Accounts	14,562		13,634
Total Protection Solutions Reserves	$	32,699	$	31,871

_______________

(1)Does not include Protection Solutions Reserves for our employee benefits business as it is a scaling business and therefore has immaterial in-force policies.

The following table presents our in-force face amounts for the periods indicated, respectively, for our individual life insurance products:

101

	March 31, 2023		December 31, 2022
	(in billions)
In-force face amount by product: (1)
Universal Life (2)	$	42.5	$	43.1
Indexed Universal Life	27.3		27.5
Variable Universal Life (3)	133.9		133.4
Term	210.5		211.9
Whole Life	1.2		1.1
Total in-force face amount	$	415.4	$	417.0

_______________

(1)Includes individual life insurance and does not include employee benefits as it is a scaling business and therefore has immaterial in-force policies.

(2)UL includes GUL.

(3)VUL includes VL and COLI.

102

Three Months Ended March 31, 2023 Compared to the Three Months Ended March 31, 2022 for the Protection Solutions Segment

Operating earnings (loss)

Operating loss increased $32 million to $35 million during the three months ended March 31, 2023 from an operating loss of $3 million in the three months ended March 31, 2022. The following notable items were the primary drivers of the change in the operating loss:

Unfavorable items included:

•Net investment income decreased by $55 million mainly due to lower alternative investment income, lower spread lending income and lower prepayment income partially offset by higher yields.

•Compensation, benefits and other operating costs and expenses increased by $17 million mainly due to the non-repeat of a litigation reserve release in the three months ended March 31, 2022.

These were partially offset by the following favorable items:

•Fee-type revenue increased by $15 million mainly driven by higher premiums due to growth in Employee Benefits (offset in policyholder’s benefits).

•Policyholders’ benefits decreased by $15 million mainly due to lower VISL mortality net of reserves offset by growth in Employee Benefits.

•Income tax expense decreased by $7 million primarily due to a higher pre-tax loss.

Wealth Management

The Wealth Management segment is an emerging leader in the wealth management space with a differentiated advice value proposition that offers discretionary and non-discretionary investment advisory accounts, financial planning and advice, insurance, and annuity products. In 2023, we began reporting this business separately from our other segments and Corporate and Other.

The following table summarizes operating earnings of our Wealth Management segment for the periods presented:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Operating earnings	$	32	$	32

Key components of operating earnings are:

	Three Months Ended March 31,
	2023		2022
	(in millions)
REVENUES
Net investment income	$	2	$	—
Net derivative gains (losses)	—		—
Investment management, service fees and other income	360		376
Segment revenues	$	362	$	376
BENEFITS AND OTHER DEDUCTIONS
Commissions and distribution-related payments	$	228	$	239
Compensation, benefits and other operating costs and expenses	91		93
Interest expense	—		—
Segment benefits and other deductions	$	319	$	332

103

The following table summarizes a revenue by activity type for our Wealth Management segment for the periods presented:

	Three Months Ended March 31,
	2023		2022
Revenue by Activity Type	(in millions)
Investment management, service fees and other income :
Investment management and advisory fees	$	127	$	139
Distribution fees	218		233
Interest Income	11		—
Service and Other income	4		3
Total Investment management, service fees and other income	$	360	$	376

The following table summarizes a roll-forward of AUA roll-forward for our Wealth Management segment for the periods presented:

	Three Months Ended March 31,
	2023		2022
Total Wealth Management Assets	(in millions)
Beginning assets	$	72,406	$	82,794
Net Flows	1,418		1,659
Market appreciation (depreciation) and other	1,816		(5,581)
Total Wealth Management ending assets	$	75,640	$	78,872

Three Months Ended March 31, 2023 Compared to the Three Months Ended March 31, 2022 for the Wealth Management Segment

Operating earnings

Operating earnings remained at $32 million during the three months ended March 31, 2023 compared to $32 million in the three months ended March 31, 2022. The following were notable changes:

Unfavorable items included:

•Investment management, service fees and other income decreased by $16 million mainly due to lower advisory fees and trail revenue driven by decreased insurance and advisory assets partially offset by $11 million of interest income driven by higher yields.

These were partially offset by the following favorable items:

•Commissions and distribution-related payments decreased by $11 million mainly due to lower advisory and insurance assets.

Net Flows and AV

•The increase in AV of $3.2 billion in the three months ended March 31, 2023 was driven by $1.8 billion as a result of equity market appreciation in 2023 and offset by net inflows of $1.4 billion.

•Net inflows of $1.4 billion were $0.2 billion lower than in the three months ended March 31, 2022 mainly driven by decreased sales.

104

Legacy

The Legacy segment consists of our capital intensive fixed-rate GMxB business written prior to 2011. In 2023, we began reporting this business separately from our Individual Retirement business.

The following table summarizes operating earnings of our Legacy segment for the periods presented:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Operating earnings	$	60	$	63

Key components of operating earnings are:

	Three Months Ended March 31,
	2023		2022
	(in millions)
REVENUES
Policy charges, fee income and premiums	$	34	$	35
Net investment income	66		61
Net derivative gains (losses)	—		—
Investment management, service fees and other income	106		119
Segment revenues	$	206	$	215
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits	$	46	$	36
Remeasurement of liability for future policy benefits	—		1
Interest credited to policyholders’ account balances	12		12
Commissions and distribution-related payments	43		55
Amortization of deferred policy acquisition costs	16		16
Compensation, benefits and other operating costs and expenses	18		19
Interest expense	—		—
Segment benefits and other deductions	$	135	$	139

The following table summarizes AV for our Legacy segment as of the dates indicated:

	March 31, 2023		December 31, 2022
	(in millions)
AV (1)
General Account	$	905	$	925
Separate Accounts	21,115		20,557
Total AV	$	22,020	$	21,482

(1)AV presented are net of reinsurance.

The following table summarizes a roll-forward of AV for our Legacy segment for the periods presented:

105

	Three Months Ended March 31,
	2023		2022
	(in millions)
Balance as of beginning of the period	$	21,482	$	29,275
Gross premiums	72		57
Surrenders, withdrawals and benefits	(595)		(670)
Net flows	(523)		(613)
Investment performance, interest credited and policy charges	1,061		(1,904)
Balance as of end of the period	$	22,020	$	26,758

Three Months Ended March 31, 2023 Compared to the Three Months Ended March 31, 2022 for the Legacy segment

Operating earnings

Operating earnings decreased $3 million to $60 million during the three months ended March 31, 2023 from $63 million in the three months ended March 31, 2022. The following notable items were the primary drivers of the change in operating earnings:

Unfavorable items included:

•Policyholders’ benefits increased by $10 million mainly due to higher benefits from GMIB annuitizations, partially offset by higher premiums.

•Fee-type revenue decreased by $14 million mainly driven by lower average Separate Accounts AV as a result of lower equity markets and net outflows.

These were partially offset by the following favorable items:

•Commissions and distribution-related payments decreased by $12 million mainly due to lower average Separate Accounts AV as result of lower equity markets and net outflows gross of reinsurance, partially offset by lower commission reimbursements recorded in Other Income.

•Net investment income increased by $5 million mainly due to higher yields partially offset by lower income from alternative investments.

Net Flows and AV

•The increase in AV of $538 million in the three months ended March 31, 2023 was driven by an increase in investments performance and interest credited to account balances, net of policy charges, of $1.1 billion as a result of equity market appreciation in 2023, partially offset by net outflows of $523 million.

•Net outflows of $523 million were $90 million lower than in the three months ended March 31, 2022, mainly driven by lower average account values due to equity market depreciation and net outflows in 2022.

Corporate and Other

Corporate and Other includes some of our financing and investment expenses. It also includes: the Closed Block, run-off variable annuity reinsurance business, run-off group pension business, run-off health business, benefit plans for our employees, certain strategic investments and certain unallocated items, including capital and related investments, interest expense and financing fees and corporate expense. AB’s results of operations are reflected in the Investment Management and Research segment. Accordingly, Corporate and Other does not include any items applicable to AB.

The following table summarizes operating earnings (loss) of Corporate and Other for the periods presented:

	Three Months Ended March 31,
	2023		2022
	(in millions)
Operating earnings (loss)	$	(81)	$	(76)

106

General Account Investment Portfolio

Our investment philosophy is driven by our long-term commitments to clients, robust risk management and strategic asset allocation. Our General Account investment portfolio investment strategy seeks to achieve sustainable risk-adjusted returns by focusing on principal preservation and investment return, subject to duration and liquidity requirements by product as well as diversification of investment risks. Investment activities are undertaken based on established investment guidelines and are required to comply with applicable laws and insurance regulations.

Risk tolerances are established for credit risk, market risk, liquidity risk and concentration risk across issuers and asset classes, each of which seek to mitigate the impact of cash flow variability arising from these risks. Significant interest rate increases and market volatility in 2022 have reduced the fair value of fixed maturities from a net unrealized gain position to a net unrealized loss. These effects apply across the portfolio and are being assessed within aggregate asset and liability management strategies. As a part of asset and liability management, we maintain a weighted average duration for our General Account investment portfolio that is within an acceptable range of the estimated duration of our liabilities given our risk appetite and hedging programs.

The General Account investment portfolio consists largely of investment grade fixed maturities, short-term investments, commercial and agricultural mortgage loans, alternative investments and other financial instruments. Fixed maturities include publicly issued corporate bonds, government bonds, privately placed notes and bonds, bonds issued by states and municipalities, mortgage-backed securities and asset-backed securities. In addition, from time to time we use derivatives for hedging purposes to reduce our exposure to equity markets, interest rates, foreign currency and credit spreads.

We incorporate ESG factors into the investment processes for a significant portion of our General Account portfolio. As investors with a long-term horizon, we believe that companies with sustainable practices are better positioned to deliver value to stakeholders over an extended period. These companies are more likely to increase sales through sustainable products, reduce energy costs and attract and retain talent. This belief underpins our approach to sustainable investing, where we seek to enhance the sustainability and quality of our investment portfolio.

Investments in our surplus portfolio are generally comprised of a mix of fixed maturity investment grade and below investment grade securities as well as various alternative investments, primarily private equity and real estate equity. Although alternative investments are subject to period over period earnings fluctuations, they have historically achieved returns in excess of the fixed maturity portfolio.

The General Account investment portfolio reflects certain differences from the presentation of the U.S. GAAP Consolidated Financial Statements. This presentation is consistent with how we manage the General Account investment portfolio. For further investment information, see Note 3 and Note 4 of the Notes to the Consolidated Financial Statements.

Investment Results of the General Account Investment Portfolio

The following table summarizes the General Account investment portfolio results with Non-GAAP Operating Earnings adjustments by asset category for the periods indicated. This presentation is consistent with how we measure investment performance for management purposes.

107

	Three Months Ended March 31,
	2023				2022
	Yield		Amount (2)		Yield		Amount (2)
	(Dollars in millions)
Fixed Maturities:
Income (loss)	3.95	%	$	714	3.29	%	$	598
Ending assets			72,394				72,866
Mortgages:
Income (loss)	4.24	%	177		3.89	%	139
Ending assets			16,969				14,452
Other Equity Investments: (1)
Income (loss)	4.68	%	41		11.02	%	81
Ending assets			3,498				3,006
Policy Loans:
Income (loss)	5.12	%	52		5.74	%	58
Ending assets			4,028				4,010
Cash and Short-term Investments:
Income (loss)	(5.00)	%	(23)		(0.16)	%	(1)
Ending assets			2,219				2,645
Funding agreements:
Interest expense and other			(87)				(12)
Ending assets (liabilities)			(8,366)				(6,088)
Total Invested Assets:
Income (loss)	3.89	%	873		3.85	%	863
Ending Assets			90,742				90,891
Short Duration Fixed Maturities:
Income (loss)	3.79	%	1		3.67	%	1
Ending assets			87				137
Total:
Investment income (loss)	3.89	%	874		3.85	%	864
Less: investment fees (3)	(0.17)	%	(39)		(0.13)	%	(29)
Investment Income, Net	3.71	%	835		3.72	%	835
Ending Net Assets			$	90,829			$	91,028

_____________

(1)Includes, as of March 31, 2023 and March 31, 2022 respectively, $394 million and $314 million of other invested assets. Amounts for certain consolidated VIE investments are shown net of associated non-controlling interest.

(2)Amount for fixed maturities and mortgages represents original cost, reduced by repayments, write-downs, adjusted amortization of premiums, accretion of discount and allowances. Cost for equity securities represents original cost reduced by write-downs; cost for other limited partnership interests represents original cost adjusted for equity in earnings and reduced by distributions.

(3)Investment fees are inclusive of investment management fees paid to AB.

AFS Fixed Maturities

The fixed maturity portfolio consists largely of investment grade corporate debt securities and includes significant amounts of U.S. government and agency obligations. The below investment grade securities in the General Account investment portfolio consist of loans to middle market companies, public high yield securities, bank loans, as well as “fallen angels,” originally purchased as investment grade investments.

AFS Fixed Maturities by Industry

The following table sets forth these fixed maturities by industry category as of the dates indicated along with their associated gross unrealized gains and losses.

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AFS Fixed Maturities by Industry (1)

	Amortized Cost		Allowance for Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Percentage of Total (%)
	(Dollars in millions)
As of March 31, 2023
Corporate Securities:
Finance	$	14,070	$	—	$	22	$	1,489	$	12,603	20	%
Manufacturing	11,667		2		29		1,460		10,234		16	%
Utilities	6,693		—		26		901		5,818		9	%
Services	8,257		16		38		1,024		7,255		11	%
Energy	3,759		—		15		500		3,274		5	%
Retail and wholesale	3,438		—		22		348		3,112		5	%
Transportation	2,345		—		11		313		2,043		3	%
Other	134		—		4		14		124		—	%
Total corporate securities	50,363		18		167		6,049		44,463		69	%
U.S. government	6,991		—		3		925		6,069		10	%
Residential mortgage-backed (2)	930		—		1		84		847		1	%
Preferred stock	40		—		3		—		43		—	%
State & political	638		—		12		75		575		1	%
Foreign governments	1,028		—		3		133		898		1	%
Commercial mortgage-backed	3,856		—		—		558		3,298		5	%
Asset-backed securities (3)	8,548		—		9		315		8,242		13	%
Total	$	72,394	$	18	$	198	$	8,139	$	64,435	100	%
As of December 31, 2022
Corporate Securities:
Finance	$	13,537	$	—	$	9	$	1,682	$	11,864	19	%
Manufacturing	11,797		2		14		1,793		10,016		16	%
Utilities	6,808		—		14		1,063		5,759		9	%
Services	8,299		22		16		1,236		7,057		11	%
Energy	3,740		—		11		574		3,177		5	%
Retail and wholesale	3,394		—		14		433		2,975		5	%
Transportation	2,277		—		8		367		1,918		3	%
Other	124		—		3		15		112		—	%
Total corporate securities	49,976		24		89		7,163		42,878		68	%
U.S. government	7,054		—		1		1,218		5,837		10	%
Residential mortgage-backed (2)	908		—		1		87		822		1	%
Preferred stock	41		—		2		—		43		—	%
State & political	609		—		7		89		527		1	%
Foreign governments	985		—		2		151		836		1	%
Commercial mortgage-backed	3,823		—		—		588		3,235		5	%
Asset-backed securities (3)	8,859		—		4		373		8,490		14	%
Total	$	72,255	$	24	$	106	$	9,669	$	62,668	100	%

______________

(1)Investment data has been classified based on standard industry categorizations for domestic public holdings and similar classifications by industry for all other holdings.

(2)Includes publicly traded agency pass-through securities and collateralized obligations.

(3)Includes credit-tranched securities collateralized by sub-prime mortgages, credit risk transfer securities and other asset types.

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Fixed Maturities Credit Quality

The SVO of the NAIC evaluates the investments of insurers for regulatory reporting purposes and assigns fixed maturities to one of six categories (“NAIC Designations”). NAIC Designations of “1” or “2” include fixed maturities considered investment grade, which include securities rated Baa3 or higher by Moody’s or BBB- or higher by Standard & Poor’s. NAIC Designations of “3” through “6” are referred to as below investment grade, which include securities rated Ba1 or lower by Moody’s and BB+ or lower by Standard & Poor’s. As a result of time lags between the funding of investments and the completion of the SVO filing process, the fixed maturity portfolio typically includes securities that have not yet been rated by the SVO as of each balance sheet date. Pending receipt of SVO ratings, the categorization of these securities by NAIC designation is based on the expected ratings indicated by internal analysis.

The following table sets forth the General Account’s fixed maturities portfolio by NAIC rating at the dates indicated.

AFS Fixed Maturities

NAIC Designation	Rating Agency Equivalent	Amortized Cost		Allowance for Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
		(in millions)
As of March 31, 2023
1................................	Aaa, Aa, A	$	44,701	$	—	$	102	$	4,721	$	40,082
2................................	Baa	25,057		—		89		3,262		21,884
	Investment grade	69,758		—		191		7,983		61,966
3................................	Ba	1,422		4		3		91		1,330
4................................	B	1,130		12		1		59		1,060
5................................	Caa	76		2		3		6		71
6................................	Ca, C	8		—		—		—		8
	Below investment grade	2,636		18		7		156		2,469
Total Fixed Maturities		$	72,394	$	18	$	198	$	8,139	$	64,435
As of December 31, 2022:
1................................	Aaa, Aa, A	$	44,612	$	—	$	56	$	5,652	$	39,016
2................................	Baa	24,843		—		47		3,804		21,086
	Investment grade	69,455		—		103		9,456		60,102
3................................	Ba	1,565		2		1		130		1,434
4................................	B	1,161		20		1		75		1,067
5................................	Caa	64		2		1		7		56
6................................	Ca, C	10		—		—		1		9
	Below investment grade	2,800		24		3		213		2,566
Total Fixed Maturities		$	72,255	$	24	$	106	$	9,669	$	62,668

Mortgage Loans

The mortgage portfolio primarily consists of commercial and agricultural mortgage loans. The investment strategy for the mortgage loan portfolio emphasizes diversification by property type and geographic location with a primary focus on asset quality. The commercial mortgage loan portfolio is backed by high quality properties located in primary markets typically owned by experienced institutional investors with a demonstrated ability to manage their assets through business cycles. Our commercial loan portfolio is monitored on an ongoing basis, assigning credit quality ratings for each loan, with the particular emphasis on loans that are scheduled to mature in the next 12 to 24 months. Scheduled maturities for 2023 and 2024 respectively are $0.5 billion and $0.9 billion, or 4% and 7% of the commercial mortgage portfolio. The commercial mortgage portfolio consists of 87% fixed rate loans and 13% floating rate loans. For floating rate loans, the borrower is typically required to purchase an interest rate cap to the scheduled maturity of the loan to protect against rising rates.

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Commercial mortgage loans are evaluated annually to determine a current loan to value ratio. Property financial statements, current rent roll, lease maturities, tenant creditworthiness, property physical inspections, and forecasted leasing market strength are used to develop projected cash flows. A discounted cash flow methodology which incorporates market data is used to determine property values. The average LTV ratio was 62% and 62% at March 31, 2023 and December 31, 2022, respectively.

The tables below show the breakdown of the amortized cost of the General Account’s investments in mortgage loans by geographic region and property type as of the dates indicated.

Mortgage Loans by Region and Property Type

	March 31, 2023				December 31, 2022
	Amortized Cost		% of Total		Amortized Cost		% of Total
	(Dollars in millions)
By Region:
U.S. Regions:
Pacific	$	4,927	29	%	$	4,903	30	%
Middle Atlantic	3,546		21		3,529		21
South Atlantic	2,312		14		2,059		12
East North Central	1,086		6		1,087		7
Mountain	1,444		8		1,368		8
West North Central	820		5		826		5
West South Central	1,115		7		1,111		7
New England	859		5		859		5
East South Central	480		3		475		3
Total U.S.	16,589		97		16,217		98
Other Regions:
Europe	519		3		393		2
Total Other	519		3		393		2
Total Mortgage Loans	$	17,108	100	%	$	16,610	100	%
By Property Type:
Office	$	4,762	28	%	$	4,749	29	%
Multifamily	6,013		35		5,657		33
Agricultural loans	2,572		15		2,590		16
Retail	317		2		327		2
Industrial	2,159		13		2,125		13
Hospitality	425		2		427		3
Other	860		5		735		4
Total Mortgage Loans	$	17,108	100	%	$	16,610	100	%

Liquidity and Capital Resources

Liquidity refers to our ability to generate adequate amounts of cash from our operating, investment and financing activities to meet our cash requirements with a prudent margin of safety. Capital refers to our long-term financial resources available to support business operations and future growth. Our ability to generate and maintain sufficient liquidity and capital is dependent on the profitability of our businesses, timing of cash flows related to our investments and products, our ability to access the capital markets, general economic conditions and the alternative sources of liquidity and capital described herein. When considering our liquidity and cash flows, we distinguish between the needs of Holdings and the needs of our insurance and non-insurance subsidiaries. We also distinguish and separately manage the liquidity and capital resources of our retirement and protection businesses (our Individual Retirement, Group Retirement, Protection Solutions and Legacy segments) and our Investment Management and Research and Wealth Management segments.

Sources and Uses of Liquidity

The Company has sufficient cash flows from operations to satisfy liquidity requirements in 2023.

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Cash Flows of Holdings

As a holding company with no business operations of its own, Holdings primarily derives cash flows from dividends from its subsidiaries and distributions related to its economic interest in AB, all of which is currently held outside our insurance company subsidiaries. These principal sources of liquidity are augmented by cash and short-term investments held by Holdings and access to bank lines of credit and the capital markets. The main uses of liquidity for Holdings are interest payments and debt repayment, payment of dividends and other distributions to stockholders (which may include stock repurchases) loans and capital contributions, if needed, to our insurance subsidiaries. Our principal sources of liquidity and our capital position are described in the following paragraphs.

Sources and Uses of Holding Company Highly Liquid Assets

The following table sets forth Holdings’ principal sources and uses of highly liquid assets for the periods indicated.

	Three Months Ended March 31,
	2023		2022
	(in millions)
Highly Liquid Assets, beginning of the period	$	1,992	$	1,742
Dividends from subsidiaries	136		280
Capital contributions to subsidiaries	—		(50)
M&A Activity	—		—
Total Business Capital Activity	136		230
Purchase of treasury shares	(214)		(279)
Shareholder dividends paid	(72)		(70)
Total Share Repurchases, Dividends and Acquisition Activity	(286)		(349)
Issuance of preferred stock	—		—
Preferred stock dividend	(14)		(14)
Total Preferred Stock Activity	(14)		(14)
Issuance of long-term debt	500		—
Repayment of long-term debt	—		—
Total External Debt Activity	500		—
Proceeds from loans from affiliates	—		—
Net decrease (increase) in existing facilities to affiliates (1)	(45)		(95)
Total Affiliated Debt Activity	(45)		(95)
Interest paid on external debt and P-Caps	(12)		(12)
Others, net	65		(18)
Total Other Activity	53		(30)
Net increase (decrease) in highly liquid assets	344		(258)
Highly Liquid Assets, end of the period	$	2,336	$	1,484

(1) Represents net activity of draws and repayments of existing credit facilities between Holdings and affiliates.

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Capital Contribution to Our Subsidiaries

During the three months ended March 31, 2023, Holdings made cash capital contributions of $0 million.

Loans from Our Subsidiaries

There were no loans from our subsidiaries during the three months ended March 31, 2023.

Cash Distributions from Our Subsidiaries

During the three months ended March 31, 2023, Holdings received cash distributions from AB of $89 million and distributions from EFIM of $29 million and EIM of $18 million.

Distributions from Insurance Subsidiaries

Our insurance companies are subject to limitations on the payment of dividends and other transfers of funds to Holdings and other affiliates under applicable insurance law and regulation. Also, more generally, the ability of our insurance subsidiaries to pay dividends can be affected by market conditions and other factors beyond our control.

Under New York’s insurance laws, which are applicable to Equitable Financial, a domestic stock life insurer may not, without prior approval of the NYDFS, pay an Ordinary Dividend. Extraordinary Dividends require the insurer to file a notice of its intent to declare the dividends with the NYDFS and obtain prior approval or non-disapproval from the NYDFS. Due to a permitted statutory accounting practice agreed to with the NYDFS, Equitable Financial will need the prior approval of the NYDFS to pay a Permitted Practice Ordinary Dividend. Applying the formula above, Equitable Financial could pay an Ordinary Dividend of up to approximately $1.7 billion in 2023.

Distributions from AllianceBernstein

ABLP is required to distribute all of its Available Cash Flow, as defined in the Amended and Restated Partnership Agreement of ABLP, to the holders of AB Units and to the General Partner. Available Cash Flow is defined as the cash flow received by ABLP from operations minus such amounts as the General Partner determines, in its sole discretion, should be retained by ABLP for use in its business, or plus such amounts as the General Partner determines, in its sole discretion, should be released from previously retained cash flow. Distributions by ABLP are made 1% to the General Partner and 99% among the limited partners.

Typically, Available Cash Flow has been the adjusted diluted net income per unit for the quarter multiplied by the number of general and limited partnership interests at the end of the quarter. In future periods, management of AB anticipates that Available Cash Flow will be based on adjusted diluted net income per unit, unless management of AB determines, with the concurrence of the Board of Directors of AB, that one or more adjustments that are made for adjusted net income should not be made with respect to the Available Cash Flow calculation.

AB Holding is required to distribute all of its Available Cash Flow, as defined in the Amended and Restated Agreement of Limited Partnership of AB Holding, to holders of AB Holding Units pro rata in accordance with their percentage interest in AB Holding. Available Cash Flow is defined as the cash distributions AB Holding receives from ABLP minus such amounts as the General Partner determines, in its sole discretion, should be retained by AB Holding for use in its business (such as the payment of taxes) or plus such amounts as the General Partner determines, in its sole discretion, should be released from previously retained cash flow. AB Holding is dependent on the quarterly cash distributions it receives from ABLP, which is subject to the performance of capital markets and other factors beyond our control. Distributions from AB Holding are made pro rata based on the holder’s percentage ownership interest in AB Holding.

As of March 31, 2023, Holdings and its non-insurance company subsidiaries hold approximately 170.1 million AB Units, 4.1 million AB Holding Units and the 1% General Partnership interest in ABLP.

As of March 31, 2023, the ownership structure of ABLP, including AB Units outstanding as well as the general partner’s 1% interest, was as follows:

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Owner	Percentage Ownership
EQH and its subsidiaries	60.0	%
AB Holding	39.3	%
Unaffiliated holders	0.7	%
Total	100.0	%

Including both the general partnership and limited partnership interests in AB Holding and ABLP, Holdings and its subsidiaries had an approximate 61% economic interest in AB as of March 31, 2023. The issuance of AB Units relating to the CarVal acquisition is not expected to have a significant impact on the Company’s cash flows.

Holdings Credit Facilities

On June 24, 2021, Holdings entered into the Amended and Restated Revolving Credit Agreement with respect to a five-year senior unsecured revolving credit facility (the “Credit Facility”), which lowered the facility amount to $1.5 billion and extended the maturity date to June 24, 2026, among other changes. The Amended and Restated Revolving Credit Agreement amends the Revolving Credit Agreement entered into by Holdings on February 16, 2018, as amended on March 22, 2021.

The Credit Facility may provide significant support to our liquidity position when alternative sources of credit are limited. In addition to the Credit Facility, we have letter of credit facilities with an aggregate principal amount of approximately $1.9 billion (the “LOC Facilities”), primarily to be used to support our life insurance business reinsured to EQ AZ Life Re in April 2018. In June 2021, Holdings entered into amendments with each of the issuers of its bilateral letter of credit facilities to effect changes similar to those effected in the Amended and Restated Revolving Credit Agreement. The respective facility limits of the bilateral letter of credit facilities remained unchanged.

The Credit Facility and LOC Facilities contain certain administrative, reporting, legal and financial covenants, including requirements to maintain a specified minimum consolidated net worth and to maintain a ratio of indebtedness to total capitalization not in excess of a specified percentage, and limitations on the dollar amount of indebtedness that may be incurred by our subsidiaries and the dollar amount of secured indebtedness that may be incurred by us, which could restrict our operations and use of funds. The right to borrow funds under the Credit Facility and LOC Facilities is subject to the fulfillment of certain conditions, including compliance with all covenants, and the ability to borrow thereunder is also subject to the continued ability of the lenders that are or will be parties to the facilities to provide funds. As of March 31, 2023, we were in compliance with these covenants.

Contingent Funding Arrangements

For information regarding activity pertaining to our contingent funding arrangements and other off-balance sheet commitments, see “Commitments and Contingent Liabilities” in Note 16 of the Notes to the Consolidated Financial Statements in this Form 10-Q.

Series A Preferred Stock, Series B Preferred Stock and Series C Preferred Stock

For information pertaining to our Series A Preferred Stock, Series B Preferred Stock and Series C Preferred Stock see Note 13 of the Notes to the Consolidated Financial Statements.

Capital Position of Holdings

We manage our capital position to maintain financial strength and credit ratings that facilitate the distribution of our products and provide our desired level of access to the bank and capital markets. Our capital position is supported by the ability of our subsidiaries to generate cash flows and distribute cash to us and our ability to effectively manage the risk of our businesses and to borrow funds and raise capital to meet our operating and growth needs.

Our Board and senior management are directly involved in the development of our capital management policies. Accordingly, capital actions, including proposed changes to the annual capital plan, capital targets and capital policies, are approved by the Board.

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Dividends Declared and Paid

The declaration and payment of future dividends is subject to the discretion of our Board of Directors and depends on our financial condition, results of operations, cash requirements, future prospects, regulatory restrictions on the payment of dividends by Holdings’ insurance subsidiaries and other factors deemed relevant by the Board. 

The payment of dividends will be substantially restricted in the event that we do not declare and pay (or set aside) dividends on the Series A , Series B and Series C Preferred Stock for the last proceeding dividend period. For additional information on our preferred stock, see “—Series A Preferred Stock, Series B Preferred Stock and Series C Preferred Stock”.

For information regarding activity pertaining to common and preferred dividends declared and paid, see Note 13 of the Notes to the Consolidated Financial Statements.

Share Repurchase Programs

For information regarding activity pertaining to share repurchase programs, see Note 13 of the Notes to the Consolidated Financial Statements.

Sources and Uses of Liquidity of Our Insurance Subsidiaries

The principal sources of liquidity for our insurance subsidiaries are premiums, investment and fee income, deposits associated with our insurance and annuity operations, cash and invested assets, as well as internal borrowings. The principal uses of that liquidity include benefits, claims and dividends paid to policyholders and payments to policyholders in connection with surrenders and withdrawals. Other uses of liquidity include commissions, general and administrative expenses, purchases of investments, the payment of dividends to Holdings and hedging activity. Certain of our insurance subsidiaries’ principal sources and uses of liquidity are described in the paragraphs that follow.

We manage the liquidity of our insurance subsidiaries with the objective of ensuring that they can meet payment obligations linked to our Individual Retirement, Group Retirement and Protection Solutions businesses and to their outstanding debt and derivative positions, including in our hedging programs, without support from Holdings. We employ an asset/liability management approach specific to the requirements of each of our insurance businesses. We measure liquidity against internally-developed benchmarks that consider the characteristics of our asset portfolio and the liabilities that it supports in both the short-term (the next 12 months) and long-term (beyond the next 12 months). We consider attributes of the various categories of our liquid assets (for example, type of asset and credit quality) in calculating internal liquidity indicators for our insurance and reinsurance operations. Our liquidity benchmarks are established for various stress scenarios and durations, including company-specific and market-wide events. The scenarios we use to evaluate the liquidity of our subsidiaries are defined to allow operating entities to operate without support from Holdings.

Liquid Assets

The investment portfolios of our insurance subsidiaries are a significant component of our overall liquidity. Liquid assets include cash and cash equivalents, short-term investments, U.S. Treasury fixed maturities, fixed maturities that are not designated as HTM and public equity securities. We believe that our business operations and the liquidity profile of our assets provide sufficient liquidity under reasonably foreseeable stress scenarios for each of our insurance subsidiaries.

See “—General Account Investment Portfolio” and Note 3 and Note 4 of the Notes to the Consolidated Financial Statements for a description of our retirement and protection businesses’ portfolio of liquid assets.

Hedging Activities

Because the future claims exposure on our insurance products, and in particular our variable annuity products with GMxB features, is sensitive to movements in the equity markets and interest rates, we have in place various hedging and reinsurance programs that are designed to mitigate the economic risks of movements in the equity markets and interest rates. We use derivatives as part of our overall asset/liability risk management program primarily to reduce exposures to equity market and interest rate risks. In addition, we use credit derivatives to replicate exposure to individual securities or pools of securities as a means of achieving credit exposure similar to bonds of the underlying issuer(s) more efficiently. The derivative contracts are an integral part of our risk management program, especially for the management of our variable annuities program, and are collectively managed to reduce the economic impact of unfavorable movements in capital markets. These derivative transactions require liquidity to meet payment obligations such as payments for periodic settlements, purchases, maturities and terminations as well as liquid assets pledged as collateral related to any decline in the net estimated fair value. Collateral calls

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represent one of our biggest drivers for liquidity needs for our insurance subsidiaries. Our derivatives contracts reside primarily within Equitable Financial, which has a significantly large investment portfolio.

FHLB Membership

Equitable Financial and Equitable America are members of the FHLB, which provides access to collateralized borrowings and other FHLB products.

See Note 16 of the Notes to the Consolidated Financial Statements for further description of our FHLB program.

FABN

Under the FABN program, Equitable Financial may issue funding agreements in U.S. dollar or other foreign currencies.

See Note 16 of the Notes to the Consolidated Financial Statements for further description of our FABN program.

Sources and Uses of Liquidity of our Investment Management and Research Segment

The principal sources of liquidity for our Investment Management and Research business include investment management fees and borrowings under its credit facilities and commercial paper program. The principal uses of liquidity include general and administrative expenses, business financing and distributions to holders of AB Units and AB Holding Units plus interest and debt service. The primary liquidity risk for our fee-based Investment Management and Research business is its profitability, which is impacted by market conditions and our investment management performance.

AB Commercial Paper

As of March 31, 2023 and December 31, 2022, AB had no commercial paper outstanding. The commercial paper is short term in nature, and as such, recorded value is estimated to approximate fair value (and considered a Level 2 security in the fair value hierarchy). Average daily borrowings for the commercial paper outstanding during the first quarter 2023 and full year 2022 were $340 million and $190 million, respectively, with weighted average interest rates of approximately 4.7% and 1.5%, respectively.

AB Credit Facility

AB has an $800 million committed, unsecured senior revolving credit facility (the “AB Credit Facility”) with a group of commercial banks and other lenders which matures on October 13, 2026. The Credit Facility was amended and restated on February 9, 2023, to reflect the transition from US LIBOR, which will be retired as of June 30, 2023, to the term Secured Overnight Financial Rate ("SOFR”). Other than this immaterial change, there were no other significant changes included in the amendment. The credit facility provides for possible increases in the principal amount by up to an aggregate incremental amount of $200 million. Any such increase is subject to the consent of the affected lenders. The AB Credit Facility is available for AB and SCB LLC for business purposes, including the support of AB’s commercial paper program. Both AB and SCB LLC can draw directly under the AB Credit Facility and AB management expects to draw on the AB Credit Facility from time to time. AB has agreed to guarantee the obligations of SCB LLC under the AB Credit Facility.

The AB Credit Facility contains affirmative, negative and financial covenants, which are customary for facilities of this type, including, among other things, restrictions on dispositions of assets, restrictions on liens, a minimum interest coverage ratio and a maximum leverage ratio. As of March 31, 2023, AB was in compliance with these covenants. The AB Credit Facility also includes customary events of default (with customary grace periods, as applicable), including provisions under which, upon the occurrence of an event of default, all outstanding loans may be accelerated and/or lender’s commitments may be terminated. Also, under such provisions, upon the occurrence of certain insolvency- or bankruptcy-related events of default, all amounts payable under the AB Credit Facility would automatically become immediately due and payable, and the lender’s commitments would automatically terminate.

Amounts under the Credit Facility may be borrowed, repaid and re-borrowed by us from time to time until the maturity of the facility. Voluntary prepayments and commitment reductions requested by AB are permitted at any time without a fee (other than customary breakage costs relating to the prepayment of any drawn loans) upon proper notice and subject to a minimum dollar requirement. Borrowings under the AB Credit Facility bear interest at a rate per annum, which will be, at AB’s option, a rate equal to an applicable margin, which is subject to adjustment based on the credit ratings of AB, plus one of the following indices: Terms Secured Overnight Financial Rate; a Prime rate; or the Federal Funds rate.

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As of March 31, 2023 and December 31, 2022, AB had no amounts outstanding under the AB Credit Facility. During the first quarter of 2023 and the full year 2022, AB and SCB LLC did not draw upon the AB Credit Facility.

In addition, SCB LLC currently has five uncommitted lines of credit with five financial institutions. Four of these lines of credit permit borrowing up to an aggregate of approximately $315 million, with AB named as an additional borrower, while the other line has no stated limit. AB has agreed to guarantee the obligations on SCB LLC under these lines of credit. As of March 31, 2023 and December 31, 2022, SCB LLC had no outstanding balance on these lines of credit. Average daily borrowings during the first quarter of 2023 and the full year 2022 were $3.7 million and $1.4 million with weighted average interest rates of approximately 7.7% and 3.7%, respectively.

EQH Facility

AB has a $900 million committed, unsecured senior credit facility (the “EQH Facility”). The EQH Facility matures on November 4, 2024 and is available for AB’s general business purposes. Borrowings under the EQH Facility generally bear interest at a rate per annum based on prevailing overnight commercial paper rates.

The EQH Facility contains affirmative, negative and financial covenants which are substantially similar to those in AB’s committed bank facilities. The EQH Facility also includes customary events of default substantially similar to those in AB’s committed bank facilities, including provisions under which, upon the occurrence of an event of default, all outstanding loans may be accelerated and/or the lender’s commitment may be terminated.

Amounts under the EQH Facility may be borrowed, repaid and re-borrowed by AB from time to time until the maturity of the facility. AB or Holdings may reduce or terminate the commitment at any time without penalty upon proper notice. Holdings also may terminate the facility immediately upon a change of control of AB’s general partner.

As of March 31, 2023 and December 31, 2022, AB had $900 million and $900 million outstanding under the EQH Facility, with interest rates of approximately 4.7% and 4.3%, respectively. Average daily borrowing of the EQH Facility during the three months ended 2023 and the full year 2022 were $804 million and $655 million, respectively, with a weighted average interest rates of approximately 4.4% and 1.7%, respectively.

EQH Uncommitted Facility

In addition to the EQH Facility, AB entered into a $300 million uncommitted, unsecured senior credit facility (the “EQH Uncommitted Facility”) with EQH. The EQH Uncommitted Facility matures on September 1, 2024 and is available for AB’s general business purposes. Borrowings under the EQH Uncommitted Facility bear interest generally at a rate per annum based on prevailing overnight commercial paper rates. The EQH Uncommitted Facility contains affirmative, negative and financial covenants, which are substantially similar to those in the EQH Facility.

As of March 31, 2023 and December 31, 2022, AB had $135 million and $90 million outstanding balance on the EQH Uncommitted Facility, with interest rates of approximately 4.7% and 4.3%, respectively. Average daily borrowing of the EQH Uncommitted Facility during the three months ended 2023 and full year 2022 were $7 million and $0 million, respectively, with weighted average interest rate of approximately 4.5% and 4.3%.

Statutory Capital of Our Insurance Subsidiaries

Our capital management framework for our insurance subsidiaries is primarily based on statutory RBC standards and the CTE asset standard for our variable annuity business.

RBC requirements are used as minimum capital requirements by the NAIC and the state insurance departments to evaluate the capital condition of regulated 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 a quarterly basis and made public 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. These rules apply to our insurance company subsidiaries and not to Holdings. State insurance laws provide insurance regulators the authority to require various actions by, or take various actions against, insurers whose total adjusted capital does not meet or exceed certain RBC levels. At the date of the most recent annual statutory financial statements filed with insurance regulators, the total adjusted capital of each of these insurance company subsidiaries subject to these requirements was in excess of each of those RBC levels.

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See Note 18 of the Notes to the Consolidated Financial Statements for additional information relating to Prescribed and Permitted Statutory Accounting practices and its impact on our statutory surplus.

Captive Reinsurance Company

We use a captive reinsurance company to more effectively manage our reserves and capital on an economic basis and to enable the aggregation and transfer of risks. Our captive reinsurance company assumes business from affiliates only and is closed to new business. Our captive reinsurance company is a wholly-owned subsidiary located in the United States. In addition to state insurance regulation, our captive is subject to internal policies governing its activities. We continue to analyze the use of our existing captive reinsurance structure, as well as additional third-party reinsurance arrangements.

Borrowings

Our financial strategy going forward will remain subject to market conditions and other factors. For example, we may from time to time enter into additional bank or other financing arrangements, including public or private debt, structured facilities and contingent capital arrangements, under which we could incur additional indebtedness.

The following table sets forth the Company’s total consolidated borrowings. Short-term and long-term debt consists of the following:

	March 31,		December 31,
	2023		2022
	(in millions)
Short-term debt:
CLO short-term debt	$	231	$	239
Current portion of long-term debt (2)	520		520
Total short-term debt	751		759
Long-term debt:
Senior Debenture, 7.0%, due 2028	350		350
Senior Note (4.35% due 2028)	1,492		1,491
Senior Note (5.594% due 2033)	496		—
Senior Note (5.00%, due 4048)	1,481		1,481
Total long-term debt	3,819		3,322
Total borrowings	$	4,570	$	4,081

______________

(1)     CLO Warehousing Debt related to VIE consolidation of CLO investment.

(2)     Current portion of long-term debt relates to the 3.9% Senior Notes which have a maturity date within one year of March 31, 2023 and December 31, 2022. The 3.9% Senior Notes were repaid April 20, 2023. For additional information regarding activity pertaining to the debt repayment, see Note 14 of the Notes to the Consolidated Financial Statements.

Notes and Debentures

The Senior Notes and Senior Debentures contain customary affirmative and negative covenants, including a limitation on certain liens and a limit on the Company’s ability to consolidate, merge or sell or otherwise dispose of all or substantially all of its assets. The Senior Notes and Senior Debentures also include customary events of default (with customary grace periods, as applicable), including provisions under which, upon the occurrence of an event of default, all outstanding Senior Notes and Senior Debentures may be accelerated. As of March 31, 2023, the Company is in compliance with all debt covenants.

Ratings

Financial strength ratings (which are sometimes referred to as “claims-paying” ratings) and credit ratings are important factors affecting public confidence in an insurer and its competitive position in marketing products. Our credit ratings are also important for our ability to raise capital through the issuance of debt and for the cost of such financing.

Financial strength ratings represent the opinions of rating agencies regarding the financial ability of an insurance company to meet its obligations under an insurance policy. Credit ratings represent the opinions of rating agencies regarding an entity’s

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ability to repay its indebtedness. The following table summarizes the ratings for Holdings and certain of its subsidiaries. AM Best, S&P and Moody’s have a stable outlook.

	AM Best	S&P	Moody’s
Last review date	Feb '23	Jun '22	Jan '23
Financial Strength Ratings:
Equitable Financial Life Insurance Company	A	A+	A1
Equitable Financial Life Insurance Company of America	A	A+	A1
Credit Ratings:
Equitable Holdings, Inc.	bbb+	BBB+	Baa1
Last review date		Sep '22	Jan '23
AllianceBernstein L.P.		A	A2

Material Cash Requirement

Our material cash requirements include policyholder obligations, long-term debt, commercial paper, employee benefits, operating leases and various funding commitments. See “Material Cash Requirement” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Annual Report on Form 10-K for the year ended December 31, 2022 for additional information.

Summary of Critical Accounting Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to adopt accounting policies and make estimates and assumptions that affect amounts reported in our consolidated financial statements included elsewhere herein. For a discussion of our significant accounting policies, see Note 2 of the Notes to the Consolidated Financial Statements. The most critical estimates include those used in determining:

•market risk benefits and purchased market risk benefits

•accounting for reinsurance;

•estimated fair values of investments in the absence of quoted market values and investment impairments;

•estimated fair values of freestanding derivatives and the recognition and estimated fair value of embedded derivatives requiring bifurcation;

•goodwill and related impairment;

•measurement of income taxes and the valuation of deferred tax assets; and

•liabilities for litigation and regulatory matters.

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 while others are specific to our business and operations. Actual results could differ from these estimates.

Market Risk Benefits

Market risk benefits include contract features that provide minimum guarantees to policyholders and include GMIB, GMDB, GMWB, GMAB, and ROP DB benefits. MRBs are measured at estimated fair value with changes reported in the Change in market risk benefits and purchased market risk benefits, except for the portion of the fair value change related to the Company’s own credit risk, which is recognized in OCI.

MRBs are measured at fair value on a seriatim basis using an Ascribed Fee approach based upon policyholder behavior projections and risk neutral economic scenarios adjusted based on the facts and circumstances of the Company’s product features. Market conditions including, but not limited 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 market inputs, as well as changes in our nonperformance risk adjustment may result in significant fluctuations in the estimated fair value of the MRBs that could materially affect net income.

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Risk margins are established to capture the non-capital market risks of the instrument which represent the additional compensation a market participant would require to assume the risks related to the uncertainties in certain actuarial assumptions. The establishment of risk margins requires the use of significant management judgment, including assumptions of the amount needed to cover the guarantees.

We ceded the risk associated with certain of the variable annuity products with GMxB features described in the preceding paragraphs. The value of the MRBs on the ceded risk is determined using a methodology consistent with that described previously for the guarantees directly written by us with the exception of the input for nonperformance risk that reflects the credit of the reinsurer.

Nonperformance Risk Adjustment

The valuation of our MRBs includes an adjustment for the risk that we fail to satisfy our obligations, which we refer to as our nonperformance risk. The nonperformance risk adjustment, which is captured as a spread over the risk-free rate in determining the discount rate to discount the cash flows of the liability, is determined by taking into consideration publicly available information relating to spreads on corporate bonds in the secondary market comparable to Holdings’ financial strength rating.

The table below illustrates the impact that a range of reasonably likely variances in credit spreads would have on our consolidated balance sheet, excluding the effect of income tax, related to the GMxB Core and GMxB Legacy MRBs measured at estimated fair value. Even when credit spreads do not change, the impact of the nonperformance risk adjustment on fair value will change when the cash flows within the fair value measurement change. The table only reflects the impact of changes in credit spreads on our consolidated financial statements included elsewhere herein and not these other potential changes. In determining the ranges, we have considered current market conditions, as well as the market level of spreads that can reasonably be anticipated over the near term. The ranges do not reflect extreme market conditions such as those experienced during the 2008–2009 financial crisis as we do not consider those to be reasonably likely events in the near future.

NPR Sensitivity

December 31, 2022

	Increase/(Decrease) In MRB
	(in millions)
Increase in NPR by 50bps	$	(1,297)
Decrease in NPR by 50bps	$	1,387

Sensitivity of MRBs to Changes in Interest Rates

The following table demonstrates the sensitivity of the MRBs to changes in long-term interest rates by quantifying the adjustments that would be required, assuming an increase and decrease in long-term interest rates of 50bps. This information considers only the direct effect of changes in the interest rates on MRB balances, net of reinsurance.

Interest Rate Sensitivity

December 31, 2022

	Increase/(Decrease) In MRB
	(in millions)
Increase in interest rates by 50bps	$	(875)
Decrease in interest rates by 50bps	$	998

Sensitivity of MRBs to Changes in Equity Returns

The following table demonstrates the sensitivity of the MRBs to changes in equity returns.

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Equity Returns Sensitivity

December 31, 2022

	Increase/(Decrease) In MRB
	(in millions)
Increase in equity returns by 10%	$	(886)
Decrease in equity returns by 10%	$	988

Sensitivity of MRBs to Changes in GMIB Lapses

Lapse rates are adjusted at the contract level based on a comparison of the value of the embedded GMIB rider and the current policyholder account value, which include other factors such as considering surrender charges. Generally, lapse rates are assumed to be lower in periods when a surrender charge applies. A dynamic lapse function reduces the base lapse rate when the guaranteed amount is greater than the account value as in-the-money contracts are less likely to lapse.

GMIB Lapse floor Sensitivity

December 31, 2022

	Increase/(Decrease) In MRB
	(in millions)
GMIB Lapse floor of 1%	$	(178)

Item 3.      Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes to the quantitative and qualitative disclosures about market risk described in the Annual Report on Form 10-K for the year ended December 31, 2022 in "Quantitative and Qualitative Disclosures About Market Risk".

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Item 4.     Controls and Procedures

Management, with the participation of the Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures, as defined in Rule 13a-15(e) of the Exchange Act. Based on such evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of March 31, 2023, the Company’s disclosure controls and procedures were effective.

During the first quarter 2023, we adopted the new accounting standard ASU 2018-12, Financial Services – Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts. We have modified our existing controls infrastructure, primarily through enhanced automation in our actuarial processes. There are no other changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and Rule 15d-15(f) under the Exchange Act) that occurred during the quarter ended March 31, 2023, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1.     Legal Proceedings

For information regarding certain legal proceedings pending against us, see Note 16 of the Notes to the Consolidated Financial Statements (unaudited) in this Form 10-Q. Also see “Risk Factors—Legal and Regulatory Risks—Legal and regulatory actions” included in our Annual Report on Form 10-K for the year ended December 31, 2022.

Item 1A. Risk Factors

You should carefully consider the risks described in the “Risk Factors” section included in our Annual Report on Form 10-K for the year ended December 31, 2022. Risks to which we are subject also include, but are not limited to, the factors mentioned under “Note Regarding Forward-Looking Statements and Information” above and the risks of our businesses described elsewhere in this Quarterly Report on Form 10-Q.

Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds

The following table provides information about purchases by Holdings during the three months ended March 31, 2023, of its common stock:

Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
1/1/23 through 1/31/23	2,022,245	$	30.66	2,022,245	$	297,048,651
2/1/23 through 2/28/23	1,930,529	$	31.30	1,930,529	$	959,538,062
3/1/23 through 3/31/23	3,305,374	$	26.99	3,305,374	$	870,311,093
Total	7,258,148	$	29.16	7,258,148	$	870,311,093

See Note 13 to the Notes to Consolidated Financial Statements for ASR transaction detail during the three months ended March 31, 2023.

Item 3.     Defaults Upon Senior Securities

None.

Item 4.     Mine Safety Disclosures

Not applicable.

Item 5.      Other Information

None.

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Item 6.     Exhibits

Number		Description and Method of Filing
4.1		Third Supplemental Indenture, dated as of January 11, 2023, between the Company and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K dated January 11, 2023).
4.2		Form of Senior Note (included as Exhibit A to Exhibit 4.1 above) (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K dated January 11, 2023).
31.1	#	Certification of the Registrant’s Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	#	Certification of the Registrant’s Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	#	Certification of the Registrant’s Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	#	Certification of the Registrant’s Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
104		Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibits 101).

______________

#    Filed herewith.

GLOSSARY

Selected Financial Terms

Account Value (“AV”)	Generally equals the aggregate policy account value of our retirement and protection products. General Account AV refers to account balances in investment options that are backed by the General Account while Separate Accounts AV refers to Separate Accounts investment assets.
Alternative investments	Investments in real estate and real estate joint ventures and other limited partnerships.
Assets under administration (“AUA”)	Includes non-insurance client assets that are invested in our savings and investment products or serviced by our Equitable Advisors platform. We provide administrative services for these assets and generally record the revenues received as distribution fees.
Assets under management (“AUM”)	Investment assets that are managed by one of our subsidiaries and includes: (i) assets managed by AB, (ii) the assets in our GAIA portfolio and (iii) the Separate Account assets of our retirement and protection businesses. Total AUM reflects exclusions between segments to avoid double counting.
Combined RBC Ratio	Calculated as the overall aggregate RBC ratio for the Company’s insurance subsidiaries including capital held for its life insurance and variable annuity liabilities and non-variable annuity insurance liabilities.
Conditional tail expectation (“CTE”)	Calculated as the average amount of total assets required to satisfy obligations over the life of the contract or policy in the worst x% of scenarios. Represented as CTE (100 less x). Example: CTE95 represents the worst five percent of scenarios.
Deferred policy acquisition cost (“DAC”)	Represents the incremental costs related directly to the successful acquisition of new and certain renewal insurance policies and annuity contracts and which have been deferred on the balance sheet as an asset.

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Deferred sales inducements (“DSI”)	Represent amounts that are credited to a policyholder’s account balance that are higher than the expected crediting rates on similar contracts without such an inducement and that are an incentive to purchase a contract and also meet the accounting criteria to be deferred as an asset that is amortized over the life of the contract.
Dividends Received Deduction (“DRD”)	A tax deduction under U.S. federal income tax law received by a corporation on the dividends it receives from other corporations in which it has an ownership stake.
Fee-type revenue	Revenue from fees and related items, including policy charges and fee income, premiums, investment management and service fees, and other income.
Gross Premiums	First year premium and renewal premium and deposits

Invested assets	Includes fixed maturity securities, equity securities, mortgage loans, policy loans, alternative investments and short-term investments.
Protection Solutions Reserves	Equals the aggregate value of Policyholders’ account balances and Future policy benefits for policies in our Protection Solutions segment.
Reinsurance	Insurance policies purchased by insurers to limit the total loss they would experience from an insurance claim.
Renewal premium and deposits	Premiums and deposits after the first twelve months of the policy or contract.
Risk-based capital (“RBC”)	Rules to determine insurance company statutory capital requirements. It is based on rules published by the National Association of Insurance Commissioners (“NAIC”).
Total adjusted capital (“TAC”)	Primarily consists of capital and surplus, and the asset valuation reserve.
Product Terms
401(k)	A tax-deferred retirement savings plan sponsored by an employer. 401(k) refers to the section of the Internal Revenue Code of 1986, as amended (the “Code”) pursuant to which these plans are established.
403(b)	A tax-deferred retirement savings plan available to certain employees of public schools and certain tax-exempt organizations. 403(b) refers to the section of the Code pursuant to which these plans are established.
Affluent	Refers to individuals with $250,000 to $999,999 of investable assets.
Annuitant	The person who receives annuity payments or the person whose life expectancy determines the amount of variable annuity payments upon annuitization of an annuity to be paid for life.
Annuitization	The process of converting an annuity investment into a series of periodic income payments, generally for life.

Benefit base	A notional amount (not actual cash value) used to calculate the owner’s guaranteed benefits within an annuity contract. The death benefit and living benefit within the same contract may not have the same benefit base.
Cash surrender value	The amount an insurance company pays (minus any surrender charge) to the policyholder when the contract or policy is voluntarily terminated prematurely.
Dollar-for-dollar withdrawal	A method of calculating the reduction of a variable annuity benefit base after a withdrawal in which the benefit is reduced by one dollar for every dollar withdrawn.
EQUI-VEST Group (“EG”)	A traditional variable deferred annuity without enhanced guaranteed benefits with single and ongoing premiums sold in the tax-exempt 403(b)/(457(b) markets.
EQUI-VEST Individual (“EI”)	A traditional variable deferred annuity without enhanced guaranteed benefits sold in the individual market.

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Future policy benefits	Future policy benefits for the annuities business are comprised mainly of liabilities for life-contingent income annuities, and liabilities for the variable annuity guaranteed minimum benefits accounted for as insurance. Future policy benefits for the life business are comprised mainly of liabilities for traditional life and certain liabilities for universal and variable life insurance contracts (other than the Policyholders’ account balance).
General Account Investment Portfolio	The invested assets held in the General Account.
General Account	The assets held in the general accounts of our insurance companies as well as assets held in our separate accounts on which we bear the investment risk.
GMxB	A general reference to all forms of variable annuity guaranteed benefits, including guaranteed minimum living benefits, or GMLBs (such as GMIBs, GMWBs and GMABs), and guaranteed minimum death benefits, or GMDBs (inclusive of return of premium death benefit guarantees).
GMxB Core	Retirement Cornerstone and Accumulator sold 2011 and later.
GMxB Legacy	Fixed-rate GMxB business written prior to 2011.
Guaranteed income benefit (“GIB”)	An optional benefit which provides the policyholder with a guaranteed lifetime annuity based on predetermined annuity purchase rates applied to a GIB benefit base, with annuitization automatically triggered if and when the contract AV falls to zero.

Guaranteed minimum accumulation benefits (“GMAB”)	An optional benefit (available for an additional cost) which entitles an annuitant to a minimum payment, typically in lump-sum, after a set period of time, typically referred to as the accumulation period. The minimum payment is based on the benefit base, which could be greater than the underlying AV.
Guaranteed minimum death benefits (“GMDB”)	An optional benefit (available for an additional cost) that guarantees an annuitant’s beneficiaries are entitled to a minimum payment based on the benefit base, which could be greater than the underlying AV, upon the death of the annuitant.
Guaranteed minimum income benefits (“GMIB”)	An optional benefit (available for an additional cost) where an annuitant is entitled to annuitize the policy and receive a minimum payment stream based on the benefit base, which could be greater than the underlying AV.
Guaranteed minimum living benefits (“GMLB”)	A reference to all forms of guaranteed minimum living benefits, including GMIBs, GMWBs and GMABs (does not include GMDBs).
Guaranteed minimum withdrawal benefits (“GMWB”)	An optional benefit (available for an additional cost) where an annuitant is entitled to withdraw a maximum amount of their benefit base each year, for which cumulative payments to the annuitant could be greater than the underlying AV.
Guaranteed Universal Life (“GUL”)	A universal life insurance offering with a lifetime no lapse guarantee rider, otherwise known as a guaranteed UL policy. With a GUL policy, the premiums are guaranteed to last the life of the policy.
Guaranteed withdrawal benefit for life (“GWBL”)	An optional benefit (available for an additional cost) where an annuitant is entitled to withdraw a maximum amount of their benefit base each year, for the duration of the policyholder’s life, regardless of account performance.
High net worth	Refers to individuals with $1,000,000 or more of investable assets.
Investment Edge (“IE”)	A traditional variable deferred annuity without enhanced guaranteed benefits.
Indexed Universal Life (“IUL”)	A permanent life insurance offering built on a universal life insurance framework that uses an equity-linked approach for generating policy investment returns.
Investment Edge (“IE”)	A traditional variable deferred annuity without enhanced guaranteed benefits that provides tax-efficient distribution.

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Living benefits	Optional benefits (available at an additional cost) that guarantee that the policyholder will get back at least his original investment when the money is withdrawn.
Mortality and expense risk fee (“M&E fee”)	A fee charged by insurance companies to compensate for the risk they take by issuing life insurance and variable annuity contracts.

Net flows	Net change in customer account balances in a period including, but not limited to, gross premiums, surrenders, withdrawals and benefits. It excludes investment performance, interest credited to customer accounts and policy charges.
Policyholder account balances	Annuities. Policyholder account balances are held for fixed deferred annuities, the fixed account portion of variable annuities and non-life contingent income annuities. Interest is credited to the policyholder’s account at interest rates we determine which are influenced by current market rates, subject to specified minimums. Life Insurance Policies. Policyholder account balances are held for retained asset accounts, universal life policies and the fixed account of universal variable life insurance policies. Interest is credited to the policyholder’s account at interest rates we determine which are influenced by current market rates, subject to specified minimums.
Return of premium (“ROP”) death benefit	This death benefit pays the greater of the account value at the time of a claim following the owner’s death or the total contributions to the contract (subject to adjustment for withdrawals). The charge for this benefit is usually included in the M&E fee that is deducted daily from the net assets in each variable investment option. We also refer to this death benefit as the Return of Principal death benefit.
Rider	An optional feature or benefit that a policyholder can purchase at an additional cost.
Separate Account	Refers to the separate account investment assets of our insurance subsidiaries excluding the assets held in those separate accounts on which we bear the investment risk.
Surrender charge	A fee paid by a contract owner for the early withdrawal of an amount that exceeds a specific percentage or for cancellation of the contract within a specified amount of time after purchase.

Surrender rate	Represents annualized surrenders and withdrawals as a percentage of average AV.
Universal life (“UL”) products	Life insurance products that provide a death benefit in return for payment of specified annual policy charges that are generally related to specific costs, which may change over time. To the extent that the policyholder chooses to pay more than the charges required in any given year to keep the policy in-force, the excess premium will be placed into the AV of the policy and credited with a stated interest rate on a monthly basis.
Variable annuity	A type of annuity that offers guaranteed periodic payments for a defined period of time or for life and gives purchasers the ability to invest in various markets though the underlying investment options, which may result in potentially higher, but variable, returns.
Variable Universal Life (“VUL”)	Universal life products where the excess amount paid over policy charges can be directed by the policyholder into a variety of Separate Account investment options. In the Separate Account investment options, the policyholder bears the entire risk and returns of the investment results.
Whole Life (“WL”)	A life insurance policy that is guaranteed to remain in-force for the policyholder’s lifetime, provided the required premiums are paid.

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ACRONYMS

•“AB” or “AllianceBernstein” means AB Holding and ABLP

•“AB Holding” means AllianceBernstein Holding L.P., a Delaware limited partnership

•“AB Holding Units” means units representing assignments of beneficial ownership of limited partnership interests in AB Holding

•“AB Units” means units of limited partnership interests in ABLP

•“ABLP” means AllianceBernstein L.P., a Delaware limited partnership and the operating partnership for the AB business

•“AFS” means available-for-sale

•“AOCI” means accumulated other comprehensive income

•“ASC” means Accounting Standards Codification

•“ASR” means accelerated share repurchase

•“ASU” means Accounting Standards Update

•“AXA” means AXA S.A., a société anonyme organized under the laws of France, and formerly our controlling stockholder

•“BPs” means basis points

•“CDS” means credit default swaps

•“CLO” means collateralized loan obligation

•“COI” means cost of insurance

•“COLI” means corporate owned life insurance

•“Company” means Equitable Holdings, Inc. with its consolidated subsidiaries

•“CS Life” means Corporate Solutions Life Reinsurance Company, a Delaware corporation and a wholly-owned direct subsidiary of Venerable Insurance and Annuity Company RE

•“CSA” means credit support annex

•“DI” means disability income

•“DOL” means U.S. Department of Labor

•“DSC” means debt service coverage

•“EAFE” means European, Australasia, and Far East

•“EB” means Employee Benefits

•“EFS” means Equitable Financial Services, LLC, a Delaware corporation and a wholly-owned direct subsidiary of Holdings

•“EPS” means earnings per share

•“EIMG” means Equitable Investment Management Group, LLC, a Delaware limited liability company and a wholly-owned indirect subsidiary of Holdings.

•“EIM” means Equitable Investment Management, LLC, a Delaware limited liability company and wholly-owned indirect subsidiary of Holdings.

•“Equitable Advisors” means Equitable Advisors, LLC, a Delaware limited liability company, our retail broker/dealer for our retirement and protection businesses and a wholly-owned indirect subsidiary of Holdings

•“Equitable America” means Equitable Financial Life Insurance Company of America (f/k/a MONY Life Insurance Company of America), an Arizona corporation and a wholly-owned indirect subsidiary of Holdings

•“Equitable Financial” means Equitable Financial Life Insurance Company, a New York corporation, a life insurance company and a wholly-owned subsidiary of EFS

•“EQ AZ Life Re” means EQ AZ Life Re Company, an Arizona corporation and a wholly-owned indirect subsidiary of Holdings.

•“ERISA” means Employee Retirement Income Security Act of 1974

•“ESG” means environmental, social and governance

•“ETF” means exchange traded funds

•“ETR” means effective tax rate

•“Exchange Act” means Securities Exchange Act of 1934, as amended

•“FABN” means Funding Agreement Backed Notes Program

•“FASB” means Financial Accounting Standards Board

•“FHLB” means Federal Home Loan Bank

•“FYP” means first year premium and deposits

•“General Partner” means AllianceBernstein Corporation, a Delaware corporation and the general partner of AB Holding and ABLP

•“HFS” means held-for-sale

•“Holdings” means Equitable Holdings, Inc.

•“HTM” means held-to-maturity

•“ISDA Master Agreement” means International Swaps and Derivatives Association Master Agreement

•“IUS” means Investments Under Surveillance

•“LIBOR” means London Interbank Offered Rate

•“LTV” means loan-to-value

•“MD&A” means Management’s Discussion and Analysis of Financial Condition and Results of Operations

•“MRBs” means market risk benefits

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•“MSO” means Market Stabilizer Option

•“MTA” means Master Transaction Agreement

•“NAIC” means National Association of Insurance Commissioners

•“NAR” means net amount at risk

•“NAV” means net asset value

•“NLG” means no-lapse guarantee

•“NYDFS” means New York State Department of Financial Services

•“OCI” means other comprehensive income

•“OTC” means over-the-counter

•“PFBL” means profits followed by losses

•“REIT” means real estate investment trusts

•“SCB LLC” means Sanford C. Bernstein & Co., LLC, a registered investment adviser and broker-dealer.

•“SCS” means Structured Capital Strategies

•“SEC” means U.S. Securities and Exchange Commission

•“Series A Preferred Stock” means Holdings’ Series A Fixed Rate Noncumulative Perpetual Preferred Stock

•“Series B Preferred Stock” means Holdings’ Series B Fixed Rate Reset Noncumulative Perpetual Preferred Stock

•“Series C Preferred Stock” means Holdings’ Series C Fixed Rate Reset Noncumulative Perpetual Preferred Stock

•“SIO” means structured investment option

•“SPE” means special purpose entity

•“SVO” means Securities Valuation Office

•“TDRs” means troubled debt restructurings

•“TIPS” means treasury inflation-protected securities

•“U.S. GAAP” means accounting principles generally accepted in the United States of America

•“UL” means universal life

•“ULSG” means universal life products with secondary guarantee

•“Venerable” means Venerable Holdings, Inc.

•“VIAC” means Venerable Insurance and Annuity Company

•“VIE” means variable interest entity

•“VISL” means variable interest-sensitive life

•“VOE” means voting interest entity

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SIGNATURES

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

Date: May 8, 2023	EQUITABLE HOLDINGS, INC.
	By:	/s/ Robin M. Raju
		Name:	Robin M. Raju
		Title:	Chief Financial Officer (Principal Financial Officer)
Date: May 8, 2023	By:	/s/ William Eckert
		Name:	William Eckert
		Title:	Chief Accounting Officer (Principal Accounting Officer)

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