OFFSETTING OF ASSETS AND LIABILITIES

Certain of the Company’s derivative instruments are subject to enforceable master netting arrangements that provide for the net settlement of all derivative contracts between the Company and a counterparty in the event of default or upon the occurrence of certain termination events. Collateral support agreements associated with each master netting arrangement provide that the Company will receive or pledge financial collateral in the event either minimum thresholds, or in certain cases ratings levels, have been reached. Additionally, certain of the Company’s repurchase agreements provide for net settlement on termination of the agreement. Refer to Note 12, Debt and Other Obligations for details of the Company’s repurchase agreement programs.

The tables below present the derivative instruments by assets and liabilities for the Company as of September 30, 2016 (Successor Company).



					Net Amounts
	Gross		Gross Amounts Offset in the		of Assets Presented in the		Gross Amounts Not Offset in the Statement of Financial Position
	Amounts of Recognized Assets		Statement of Financial Position		Statement of Financial Position		Financial Instruments		Cash Collateral Received		Net Amount
	(Dollars In Thousands)
Offsetting of Derivative Assets
Derivatives:
Free-Standing derivatives	$	586,545	$	—	$	586,545	$	114,968	$	299,819	$	171,758
Total derivatives, subject to a master netting arrangement or similar arrangement	586,545		—		586,545		114,968		299,819		171,758
Derivatives not subject to a master netting arrangement or similar arrangement
Embedded derivative - Modco reinsurance treaties	2,787		—		2,787		—		—		2,787
Embedded derivative - GMWB	33,675		—		33,675		—		—		33,675
Derivatives with PLC	50,687		—		50,687		—		—		50,687
Other	123		—		123		—		—		123
Total derivatives, not subject to a master netting arrangement or similar arrangement	87,272		—		87,272		—		—		87,272
Total derivatives	673,817		—		673,817		114,968		299,819		259,030
Total Assets	$	673,817	$	—	$	673,817	$	114,968	$	299,819	$	259,030



					Net Amounts
	Gross		Gross Amounts Offset in the		of Liabilities Presented in the		Gross Amounts Not Offset in the Statement of Financial Position
	Amounts of Recognized Liabilities		Statement of Financial Position		Statement of Financial Position		Financial Instruments		Cash Collateral Paid		Net Amount
	(Dollars In Thousands)
Offsetting of Derivative Liabilities
Derivatives:
Free-Standing derivatives	$	129,740	$	—	$	129,740	$	114,968	$	14,772	$	—
Total derivatives, subject to a master netting arrangement or similar arrangement	129,740		—		129,740		114,968		14,772		—
Derivatives, not subject to a master netting arrangement or similar arrangement
Embedded derivative - Modco reinsurance treaties	254,285		—		254,285		—		—		254,285
Funds withheld derivative	112,344		—		112,344		—		—		112,344
Embedded derivative - GMWB	162,543		—		162,543		—		—		162,543
Embedded derivative - FIA	141,651		—		141,651		—		—		141,651
Embedded derivative - IUL	46,348		—		46,348		—		—		46,348
Total derivatives, not subject to a master netting arrangement or similar arrangement	717,171		—		717,171		—		—		717,171
Total derivatives	846,911		—		846,911		114,968		14,772		717,171
Repurchase agreements(1)	219,457		—		219,457		—		—		219,457
Total Liabilities	$	1,066,368	$	—	$	1,066,368	$	114,968	$	14,772	$	936,628

(1) Borrowings under repurchase agreements are for a term less than 90 days.

The tables below present the derivative instruments by assets and liabilities for the Company as of December 31, 2015 (Successor Company).



					Net Amounts
	Gross		Gross Amounts Offset in the		of Assets Presented in the		Gross Amounts Not Offset in the Statement of Financial Position
	Amounts of Recognized Assets		Statement of Financial Position		Statement of Financial Position		Financial Instruments		Cash Collateral Received		Net Amount
	(Dollars In Thousands)
Offsetting of Derivative Assets
Derivatives:
Free-Standing derivatives	$	254,840	$	—	$	254,840	$	42,382	$	105,842	$	106,616
Total derivatives, subject to a master netting arrangement or similar arrangement	254,840		—		254,840		42,382		105,842		106,616
Derivatives not subject to a master netting arrangement or similar arrangement
Embedded derivative - Modco reinsurance treaties	1,215		—		1,215		—		—		1,215
Embedded derivative - GMWB	49,007		—		49,007		—		—		49,007
Derivatives with PLC	18,161		—		18,161		—		—		18,161
Other	347		—		347		—		—		347
Total derivatives, not subject to a master netting arrangement or similar arrangement	68,730		—		68,730		—		—		68,730
Total derivatives	323,570		—		323,570		42,382		105,842		175,346
Total Assets	$	323,570	$	—	$	323,570	$	42,382	$	105,842	$	175,346



					Net Amounts
	Gross		Gross Amounts Offset in the		of Liabilities Presented in the		Gross Amounts Not Offset in the Statement of Financial Position
	Amounts of Recognized Liabilities		Statement of Financial Position		Statement of Financial Position		Financial Instruments		Cash Collateral Paid		Net Amount
	(Dollars In Thousands)
Offsetting of Derivative Liabilities
Derivatives:
Free-Standing derivatives	$	43,999	$	—	$	43,999	$	42,382	$	1,617	$	—
Total derivatives, subject to a master netting arrangement or similar arrangement	43,999		—		43,999		42,382		1,617		—
Derivatives not subject to a master netting arrangement or similar arrangement
Embedded derivative - Modco reinsurance treaties	178,362		—		178,362		—		—		178,362
Funds withheld derivative	102,378		—		102,378		—		—		102,378
Embedded derivative - GMWB	67,528		—		67,528		—		—		67,528
Embedded derivative - FIA	100,329		—		100,329		—		—		100,329
Embedded derivative - IUL	29,629		—		29,629		—		—		29,629
Total derivatives, not subject to a master netting arrangement or similar arrangement	478,226		—		478,226		—		—		478,226
Total derivatives	522,225		—		522,225		42,382		1,617		478,226
Repurchase agreements⁽¹⁾	438,185		—		438,185		—		—		438,185
Total Liabilities	$	960,410	$	—	$	960,410	$	42,382	$	1,617	$	916,411

(1) Borrowings under repurchase agreements are for a term less than 90 days.