Corebridge Financial Shines in Earnings Call

Corebridge Financial, Inc. ((CRBG)) has held its Q4 earnings call. Read on for the main highlights of the call.

Corebridge Financial’s latest earnings call conveyed a strong sense of optimism as the company showcased impressive financial performance. Despite some challenges such as a decline in base spread income and a projected increase in surrender rates, Corebridge remains confident about its future, driven by strategic growth initiatives and expansion into new product categories.

Strong Top-Line and Bottom-Line Growth

Corebridge Financial has consistently demonstrated robust financial growth since its IPO. In 2024, the company achieved a 5% increase in premiums and deposits, totaling $41.7 billion. This solid top-line performance highlights the company’s ability to effectively drive sales volumes, contributing to its bottom-line success.

Achieved and Exceeded Financial Goals

The company successfully met and surpassed its financial targets, boasting an adjusted return on equity (ROE) of 12.8% for 2024. Corebridge’s run-rate ROE grew by over 300 basis points, and it impressively returned $4.9 billion to its shareholders, reflecting a cumulative payout ratio of 73%.

Successful Cost Reduction Initiatives

Corebridge made significant strides in reducing expenses, achieving $350 million of its $400 million run-rate expense reduction target ahead of schedule. This resulted in a 13% reduction in comparable expenses, underscoring the effectiveness of its cost management strategies.

Strong Fourth Quarter Performance

The fourth quarter of 2024 was a standout for Corebridge, with adjusted pretax operating income reaching $878 million. The company reported an 18% year-over-year increase in operating earnings per share, hitting $1.23, further affirming its financial strength.

Expansion into New Product Categories

In a strategic move to diversify its offerings, Corebridge launched the MarketLock registered index-linked annuity (RILA), now covering every major product category. This expansion is set to enhance the company’s market position and drive future growth.

Increased Shareholder Returns

Corebridge’s commitment to rewarding its shareholders was evident as the Board of Directors increased the share repurchase authorization by $2 billion and raised the quarterly dividend to $0.24 per share, reflecting the company’s solid financial footing.

Base Spread Income Decline

Despite the overall positive performance, Corebridge faced a 5% decline in base spread income due to net outflows in the group retirement business and changes in short-term interest rates. This highlights a challenge the company is addressing amid economic shifts.

Expected Increase in Surrender Rates

Looking ahead, Corebridge anticipates a rise in surrender rates as significant blocks of fixed and fixed-index annuity exit their surrender charge period. This expectation requires strategic management to mitigate potential impacts on financial performance.

Near-Term Headwinds from Interest Rate Changes

The company identified short-term interest rate changes and related hedging activities as potential near-term headwinds, particularly affecting spread income in the first half of 2025. Corebridge is preparing to navigate these challenges as part of its strategic planning.

Forward-Looking Guidance

Corebridge Financial’s forward-looking guidance remains robust, with expectations of a 10% to 15% annual increase in run-rate earnings per share over the long term. The company also forecasts a 5% to 10% increase in dividends from insurance subsidiaries in 2025. These projections underscore Corebridge’s focus on sustained growth and shareholder value.

In conclusion, Corebridge Financial’s earnings call showcased a company that is not only performing strongly but is also strategically positioning itself for future growth. With a positive sentiment underscored by strong earnings, successful cost management, and strategic expansion, Corebridge continues to be a compelling player in the financial markets.