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How AIG’s Group Retirement Segment Performed in 4Q17

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Feb. 27 2018, Updated 7:32 a.m. ET

Premiums and deposits

American International Group’s (AIG) Group Retirement segment reported a decline in its premiums and deposits in 4Q17 compared to 4Q16. In 4Q17, this metric reached $1.8 billion compared to $2.0 billion in 4Q16. The segment’s premiums have remained flat at $6.0 million in 4Q17 compared to 4Q16.

AIG’s Group Retirement segment’s assets under administration (or AUA) stood at $103.8 billion as of December 31, 2017, due to favorable momentum in the equity markets. This segment saw a marginal fall in net investment income from $558.0 million in 4Q16 to $550.0 million in 4Q17.

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Net flows

AIG’s Group Retirement segment reported net outflows of $1.0 billion in 2017 compared to $0.6 billion in 2016. In 2017, the segment saw significant sales. These sales were negatively impacted by the participant surrenders, which resulted in the net outflows. The segment saw a decline in its adjusted pretax income from $261.0 million in 4Q16 to $246.0 million in 4Q17.

AIG’s Group Retirement segment saw a rise in benefits, losses, and expenses in 4Q17 compared to 4Q16. In 4Q17, this metric reached $486.0 million compared to $455.0 million in 4Q16. The segment’s advisory fees and other income stood at $62.0 million in 4Q17 compared to $54.0 million in 4Q16.

AIG’s dividend yield stood at ~2.2% on an LTM (last-12-months) basis. Among its peers (XLF), Aspen Insurance Holdings (AHL), Hartford Financial Services (HIG), and RenaissanceRe Holdings (RNR) reported dividend yields of ~2.6%, ~1.7%, and 1.0%, respectively, on an LTM basis.

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