Investments

9 Months Ended

Sep. 30, 2022

Investments [Abstract]

Investments

Investments

The following is a summary of Ameriprise Financial investments:

	September 30, 2022		December 31, 2021
	(in millions)
Available-for-Sale securities, at fair value	$	36,386	$	32,050
Mortgage loans (allowance for credit losses: 2022, $12; 2021, $12)	1,986		1,953
Policy loans	838		835
Other investments (allowance for credit losses: 2022, $5; 2021, $5)	862		972
Total	$	40,072	$	35,810

Other investments primarily reflect the Company’s interests in affordable housing partnerships, trading securities, equity securities, seed money investments, syndicated loans, credit card receivables and certificates of deposit with original or remaining maturities at the time of purchase of more than 90 days.

The following is a summary of Net investment income:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(in millions)
Investment income on fixed maturities	$	363	$	202	$	836	$	733
Net realized gains (losses)	(87)		546		(82)		627
Affordable housing partnerships	(11)		(20)		(37)		(58)
Other	51		1		110		28
Consolidated investment entities	33		44		70		98
Total	$	349	$	773	$	897	$	1,428

Available-for-Sale securities distributed by type were as follows:

	September 30, 2022
Description of Securities	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
	(in millions)
Corporate debt securities	$	9,777	$	125	$	(983)	$	(20)	$	8,899
Residential mortgage backed securities	15,825		5		(1,426)		—		14,404
Commercial mortgage backed securities	6,041		1		(436)		—		5,606
Asset backed securities	5,592		11		(195)		—		5,408
State and municipal obligations	782		56		(26)		(2)		810
U.S. government and agency obligations	1,174		—		(1)		—		1,173
Foreign government bonds and obligations	48		—		(5)		—		43
Other securities	45		1		(3)		—		43
Total	$	39,284	$	199	$	(3,075)	$	(22)	$	36,386

Description of Securities	December 31, 2021
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
	(in millions)
Corporate debt securities	$	8,737	$	1,243	$	(48)	$	—	$	9,932
Residential mortgage backed securities	10,927		67		(50)		—		10,944
Commercial mortgage backed securities	4,950		59		(23)		—		4,986
Asset backed securities	3,639		26		(11)		—		3,654
State and municipal obligations	850		244		(1)		(1)		1,092
U.S. government and agency obligations	1,301		—		—		—		1,301
Foreign government bonds and obligations	88		5		(1)		—		92
Other securities	49		—		—		—		49
Total	$	30,541	$	1,644	$	(134)	$	(1)	$	32,050

As of September 30, 2022 and December 31, 2021, accrued interest of $207 million and $140 million, respectively, is excluded from the amortized cost basis of Available-for-Sale securities in the tables above and is recorded in Receivables.

As of September 30, 2022 and December 31, 2021, investment securities with a fair value of $3.6 billion and $3.1 billion, respectively, were pledged to meet contractual obligations under derivative contracts and short-term borrowings, of which $373 million and $314 million, respectively, may be sold, pledged or rehypothecated by the counterparty.

As of September 30, 2022 and December 31, 2021, fixed maturity securities comprised approximately 90% and 89%, respectively, of Ameriprise Financial investments. Rating agency designations are based on the availability of ratings from Nationally Recognized Statistical Rating Organizations (“NRSROs”), including Moody’s Investors Service (“Moody’s”), Standard & Poor’s Ratings Services (“S&P”) and Fitch Ratings Ltd. (“Fitch”). The Company uses the median of available ratings from Moody’s, S&P and Fitch, or if fewer than three ratings are available, the lower rating is used. When ratings from Moody’s, S&P and Fitch are unavailable, the Company may utilize ratings from other NRSROs or rate the securities internally. As of September 30, 2022 and December 31, 2021,

the Company’s internal analysts rated $318 million and $400 million, respectively, of securities using criteria similar to those used by NRSROs.

A summary of fixed maturity securities by rating was as follows:

Ratings	September 30, 2022						December 31, 2021
	Amortized Cost		Fair Value		Percent of Total Fair Value		Amortized Cost		Fair Value		Percent of Total Fair Value
	(in millions, except percentages)
AAA	$	27,655	$	25,629	70	%	$	20,563	$	20,625	64	%
AA	1,150		1,175		3		727		898		3
A	1,802		1,788		5		1,775		2,129		7
BBB	8,001		7,192		20		6,495		7,268		23
Below investment grade (1)	676		602		2		981		1,130		3
Total fixed maturities	$	39,284	$	36,386	100	%	$	30,541	$	32,050	100	%

(1) The amortized cost and fair value of below investment grade securities includes interest in non-consolidated CLOs managed by the Company of $1 million and $2 million, respectively, as of both September 30, 2022 and December 31, 2021. These securities are not rated but are included in below investment grade due to their risk characteristics.

As of September 30, 2022 and December 31, 2021, approximately 29% and 30% of securities rated AAA were GNMA, FNMA and FHLMC mortgage backed securities, respectively. No holdings of any issuer were greater than 10% of the Company’s total shareholder’s equity as of both September 30, 2022 and December 31, 2021.

The following tables summarize the fair value and gross unrealized losses on Available-for-Sale securities, aggregated by major investment type and the length of time that individual securities have been in a continuous unrealized loss position for which no allowance for credit losses has been recorded:

Description of Securities	September 30, 2022
	Less than 12 Months					12 Months or More					Total
	Number of Securities	Fair Value		Unrealized Losses		Number of Securities	Fair Value		Unrealized Losses		Number of Securities	Fair Value		Unrealized Losses
	(in millions, except number of securities)
Corporate debt securities	484	$	6,088	$	(694)	72	$	1,049	$	(289)	556	$	7,137	$	(983)
Residential mortgage backed securities	675	12,000		(1,057)		141	2,067		(369)		816	14,067		(1,426)
Commercial mortgage backed securities	273	4,064		(308)		61	941		(128)		334	5,005		(436)
Asset backed securities	152	4,981		(171)		12	262		(24)		164	5,243		(195)
State and municipal obligations	61	158		(18)		16	36		(8)		77	194		(26)
U.S. government and agency obligations	26	1,108		(1)		—	—		—		26	1,108		(1)
Foreign government bonds and obligations	13	38		(4)		1	1		(1)		14	39		(5)
Other securities	3	42		(3)		—	—		—		3	42		(3)
Total	1,687	$	28,479	$	(2,256)	303	$	4,356	$	(819)	1,990	$	32,835	$	(3,075)

Description of Securities	December 31, 2021
	Less than 12 Months					12 Months or More					Total
	Number of Securities	Fair Value		Unrealized Losses		Number of Securities	Fair Value		Unrealized Losses		Number of Securities	Fair Value		Unrealized Losses
	(in millions, except number of securities)
Corporate debt securities	110	$	2,056	$	(43)	14	$	81	$	(5)	124	$	2,137	$	(48)
Residential mortgage backed securities	206	5,808		(48)		56	191		(2)		262	5,999		(50)
Commercial mortgage backed securities	102	2,184		(22)		9	139		(1)		111	2,323		(23)
Asset backed securities	41	1,883		(11)		6	118		—		47	2,001		(11)
State and municipal obligations	26	64		(1)		—	—		—		26	64		(1)
Foreign government bonds and obligations	5	6		—		6	4		(1)		11	10		(1)
Total	490	$	12,001	$	(125)	91	$	533	$	(9)	581	$	12,534	$	(134)

As part of the Company’s ongoing monitoring process, management determined that the change in gross unrealized losses on its Available-for-Sale securities for which an allowance for credit losses has not been recognized during the nine months ended September 30, 2022 is primarily attributable to the impact of higher interest rates and wider credit spreads driven by continued market volatility, with no specific credit concerns. The Company did not recognize these unrealized losses in earnings because it was determined that such losses were due to non-credit factors. The Company does not intend to sell these securities and does not believe that it is more likely than not that the Company will be required to sell these securities before the anticipated recovery of the remaining amortized cost basis. As of September 30, 2022 and December 31, 2021, approximately 95% and 96%, respectively, of the total of Available-for-Sale securities with gross unrealized losses were considered investment grade.

The following table presents a rollforward of the allowance for credit losses on Available-for-Sale securities:

	Corporate Debt Securities		Asset Backed Securities		State and Municipal Obligations		Total
	(in millions)
Balance at July 1, 2022	$	—	$	—	$	1	$	1
Additions for which credit losses were not previously recorded	20		—		—		20
Additional increases (decreases) on securities that had an allowance recorded in a previous period	—		—		1		1
Balance at September 30, 2022	$	20	$	—	$	2	$	22
Balance at July 1, 2021	$	—	$	—	$	—	$	—
Additions for which credit losses were not previously recorded	—		—		1		1
Balance at September 30, 2021	$	—	$	—	$	1	$	1
Balance at January 1, 2022	$	—	$	—	$	1	$	1
Additions for which credit losses were not previously recorded	20		—		—		20
Additional increases (decreases) on securities that had an allowance recorded in a previous period	—		—		1		1
Balance at September 30, 2022	$	20	$	—	$	2	$	22
Balance at January 1, 2021	$	10	$	1	$	—	$	11
Additions for which credit losses were not previously recorded	—		—		1		1
Charge-offs	(10)		(1)		—		(11)
Balance at September 30, 2021	$	—	$	—	$	1	$	1

Net realized gains and losses on Available-for-Sale securities, determined using the specific identification method, recognized in Net investment income were as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(in millions)
Gross realized investment gains	$	2	$	508	$	24	$	573
Gross realized investment losses	(6)		(5)		(17)		(6)
Credit losses	(21)		(1)		(21)		(1)
Other impairments	(61)		—		(67)		(13)
Total	$	(86)	$	502	$	(81)	$	553

Credit losses for the three and nine months ended September 30, 2022 primarily related to recording an allowance for credit losses on a corporate debt security in the communications industry. Credit losses for the three and nine months ended September 30, 2021 primarily related to recording an allowance for credit losses on a state and municipal security. Other impairments for the three and nine months ended September 30, 2022 and the nine months ended September 30, 2021 related to Available-for-Sale securities which the Company intended to sell.

See Note 14 for a rollforward of net unrealized investment gains (losses) included in AOCI.

Available-for-Sale securities by contractual maturity as of September 30, 2022 were as follows:

	Amortized Cost		Fair Value
	(in millions)
Due within one year	$	1,680	$	1,671
Due after one year through five years	2,247		2,155
Due after five years through 10 years	3,662		3,086
Due after 10 years	4,237		4,056
	11,826		10,968
Residential mortgage backed securities	15,825		14,404
Commercial mortgage backed securities	6,041		5,606
Asset backed securities	5,592		5,408
Total	$	39,284	$	36,386

Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Residential mortgage backed securities, commercial mortgage backed securities and asset backed securities are not due at a single maturity date. As such, these securities were not included in the maturities distribution.