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How Apollo’s Credit Segment Performed

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Total revenues

Apollo Global Management’s (APO) credit segment witnessed a substantial rise in the total revenues from $214.9 million in 4Q16 to $296.9 million in 4Q17. The segment’s economic income of $155.4 million in 4Q17 was positively impacted by carried interest income as well as fee-related earnings (or FRE). However, in 4Q17, the segment witnessed a marginal decline in Athene’s fair value.

In 4Q17, the credit segment witnessed a substantial 20% rise YoY in total assets under management (or AUM) to $164 billion. In permanent capital vehicles, the AUM was around $100 billion and is included in the above-mentioned amount of total AUM.

However, APO peers (XLF) Blackstone Group (BX), KKR & Company (KKR), and Carlyle Group (CG) have total AUM of $138.1 billion, $70.9 billion, and $33.3 billion, respectively, in their credit segments in 4Q17.

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Inflows

In 4Q17, the credit segment saw inflows amounting to $6.9 billion, while in 2017, inflows stood at $28.2 billion. In 4Q17, the segment’s gross returns stood at 2.2%, while in 2017, gross returns were 8.3% thanks to the favorable momentum in the segment’s offerings. Among these, permanent capital vehicles as well as drawdown funds were the primary contributors.

The credit segment witnessed a substantial rise in the FRE from $51.9 million in 4Q16 to $111.2 million in 4Q17. The segment saw deployment amounting to $2.7 billion in 4Q17, while in 2017 deployments were $6.3 billion.

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