Athene Holding Ltd, the Bermudian-based life and annuity reinsurer, reported net income of $578 million, or $2.94 per diluted common share, in the first quarter of 2021.

That compares with a loss of $1.1 billion, or $5.81 per diluted share for the first quarter of 2020.

The increase from the prior year quarter was driven by higher adjusted operating income, a favourable change in the net fair value of fixed indexed annuity derivatives, and a less unfavourable change in fair value of reinsurance assets and provision for credit losses, partially offset by higher non-operating expenses, the company said.

Adjusted operating income available to common shareholders for the first quarter was $748 million, or $3.80 per adjusted operating common share, compared to a $108 million loss, or 60 cents per adjusted operating common share for the first quarter 2020.

Athene reported strong gross organic inflows totalling $8.2 billion underwritten to target returns and driving annualised net organic growth of 8 per cent.

The company reported record quarterly alternative investment performance driven by particular strength from investments in Venerable, AmeriHome, and MidCap.

Athene highlighted its robust capitalisation with $3.6 billion of excess equity capital and $8.1 billion of total deployable capital.

It also highlighted the announced strategic merger with Apollo in March, which Athene said positions both companies for accelerating growth and profitability within a fully-aligned model.

The gross organic inflows of $8.2 billion, the company’s second highest quarter of organic inflows, represent an increase of 107 per cent year-over-year.

The company generated retail inflows of $1.8 billion, an increase of 41 per cent year-over-year despite seasonally lighter first quarter trends and increasing competition for traditional fixed annuity/MYGA business. First-quarter inflows saw strong growth in fixed indexed annuity sales, resulting in the best first quarter for FIA inflows to date, the company said.

Athene generated flow reinsurance inflows of $299 million, a decrease of 65 per cent year-over-year and 47 per cent quarter-over-quarter.

In the first quarter, Athene completed a large scale pension risk transfer transaction totaling $2.9 billion. This transaction with JCPenney was Athene's largest PRT transaction to date, and the largest in the US during the quarter, the company said.

Athene generated $3.2 billion of funding agreement activity, the strongest quarterly inflow result for this channel to date, representing nearly a fourfold increase year-over-year and approximately 50 per cent increase quarter-over-quarter. The robust issuance activity was driven by seven transactions across four different currencies, underwritten to attractive returns, the company said.

In the first quarter, Athene generated net organic flows of $3.2 billion. This was driven by the aforementioned gross organic inflows of $8.2 billion, less $1.5 billion of inflows attributable to third party investors in ACRA related to PRT activity, as well as normal course net outflows of $3.5 billion.

Athene's net annualised organic growth rate for the first quarter was 8 per cent versus 4 per cent in the prior year quarter.

Jim Belardi, chief executive officer of Athene, said: “In the first quarter, we demonstrated superb execution on both sides of the balance sheet, with strong organic growth and asset outperformance combining to drive record profitability. Athene generated $8.2 billion of gross organic inflows, marking our second-highest quarterly total ever.

“In addition, our alternative investment portfolio generated record income, showcasing the advantages of our differentiated approach to investing in this asset class. Our record quarterly adjusted operating income drove Athene's adjusted book value to nearly $63 per share, continuing an upward climb of 16 per cent per year since our inception 12 years ago.

“These results demonstrate that our spread-based business model is continuing to scale and grow very profitably, carrying significant momentum into the remainder of 2021. With this backdrop of strong performance, we are extremely excited to have announced a strategically compelling merger transaction with Apollo in March, which will fully align our organisations and accelerate our future profitable growth.”