REINSURANCE GROUP OF AMERICA INC [RGA] Filings

10-Q 1 rga-20220331.htm 10-Q rga-20220331

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 1-11848

REINSURANCE GROUP OF AMERICA, INCORPORATED

(Exact name of Registrant as specified in its charter)


Missouri						43-1627032
(State or other jurisdiction						(IRS employer
of incorporation or organization)						identification number)

16600 Swingley Ridge Road

Chesterfield, Missouri 63017

(Address of principal executive offices)

(636) 736-7000

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes ☒ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer x Accelerated filer o Non-accelerated filer o

Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.01

RGA

New York Stock Exchange

6.20% Fixed-To-Floating Rate Subordinated Debentures due 2042

RZA

New York Stock Exchange

5.75% Fixed-To-Floating Rate Subordinated Debentures due 2056

RZB

New York Stock Exchange

As of April 30, 2022, 66,989,863 shares of the registrant’s common stock were outstanding.

Table of Contents

REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES

TABLE OF CONTENTS


Item		Page

	PART I – FINANCIAL INFORMATION

1	Financial Statements
	Condensed Consolidated Balance Sheets (Unaudited) March 31, 2022 and December 31, 2021	3
	Condensed Consolidated Statements of Income (Unaudited) Three months ended March 31, 2022 and 2021	4
	Condensed Consolidated Statements of Comprehensive Income (Unaudited) Three months ended March 31, 2022 and 2021	5
	Condensed Consolidated Statements of Equity (Unaudited) Three months ended March 31, 2022 and 2021	6
	Condensed Consolidated Statements of Cash Flows (Unaudited) Three months ended March 31, 2022 and 2021	7
	Notes to Condensed Consolidated Financial Statements (Unaudited):	8
	1. Business and Basis of Presentation	8
	2. Earnings Per Share	8
	3. Equity	9
	4. Investments	11
	5. Derivative Instruments	19
	6. Fair Value of Assets and Liabilities	23
	7. Segment Information	29
	8. Commitments, Contingencies and Guarantees	31
	9. Income Tax	32
	10. Employee Benefit Plans	33
	11. Reinsurance	33
	12. Policy Claims and Benefits	34
	13. New Accounting Standards	35
2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	36
3	Quantitative and Qualitative Disclosure About Market Risk	61
4	Controls and Procedures	61

	PART II – OTHER INFORMATION

1	Legal Proceedings	62
1A	Risk Factors	62
2	Unregistered Sales of Equity Securities and Use of Proceeds	62
6	Exhibits	62
	Index to Exhibits	63
	Signatures	64

Table of Contents

PART I - FINANCIAL INFORMATION

REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except share data)

(Unaudited)


	March 31, 2022		December 31, 2021
Assets
Fixed maturity securities available-for-sale, at fair value (amortized cost of $57,849 and $55,873; allowance for credit losses of $42 and $31)	$	57,922	$	60,749
Equity securities, at fair value	139		151
Mortgage loans on real estate (net of allowance for credit losses of $37 and $35)	6,535		6,283
Policy loans	1,221		1,234
Funds withheld at interest	6,737		6,954
Short-term investments	315		87
Other invested assets	3,033		3,070
Total investments	75,902		78,528
Cash and cash equivalents	2,709		2,948
Accrued investment income	578		533
Premiums receivable and other reinsurance balances	2,883		2,888
Reinsurance ceded receivables	2,595		2,580
Deferred policy acquisition costs	3,797		3,690
Other assets	1,297		1,008
Total assets	$	89,761	$	92,175
Liabilities and Equity
Future policy benefits	$	35,946	$	35,782
Interest-sensitive contract liabilities	28,083		26,377
Other policy claims and benefits	7,079		6,993
Other reinsurance balances	582		613
Deferred income taxes	1,843		2,886
Other liabilities	3,123		2,663

Long-term debt	3,667		3,667
Collateral finance and securitization notes	166		180
Total liabilities	80,489		79,161
Commitments and contingent liabilities (See Note 8)
Equity:
Preferred stock – par value $.01 per share, 10,000,000 shares authorized, no shares issued or outstanding	—		—
Common stock – par value $.01 per share, 140,000,000 shares authorized, 85,310,598 shares issued at March 31, 2022 and December 31, 2021	1		1
Additional paid-in-capital	2,465		2,461
Retained earnings	8,446		8,563
Treasury stock, at cost – 18,322,345 and 18,139,868 shares	(1,675)		(1,653)
Accumulated other comprehensive income (loss)	(55)		3,642
Total Reinsurance Group of America, Inc. stockholders’ equity	9,182		13,014
Noncontrolling interest	90		—
Total equity	9,272		13,014
Total liabilities and equity	$	89,761	$	92,175

See accompanying notes to condensed consolidated financial statements (unaudited).

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REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in millions, except per share amounts)

(Unaudited)


	Three months ended March 31,
		2022		2021
Revenues:
Net premiums		$	3,155	$	2,914
Net investment income		810		812




Investment related gains (losses), net		(126)		302
Other revenues		91		91
Total revenues		3,930		4,119
Benefits and Expenses:
Claims and other policy benefits		3,225		3,192
Interest credited		141		146
Policy acquisition costs and other insurance expenses		355		333
Other operating expenses		226		214
Interest expense		42		45
Collateral finance and securitization expense		1		3
Total benefits and expenses		3,990		3,933
Income (loss) before income taxes		(60)		186
Provision for income taxes		3		47
Net income (loss)		$	(63)	$	139
Earnings per share:
Basic earnings per share		$	(0.93)	$	2.04
Diluted earnings per share		$	(0.93)	$	2.03

See accompanying notes to condensed consolidated financial statements (unaudited).

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REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in millions)

(Unaudited)


	Three months ended March 31,
		2022		2021
Comprehensive income (loss)
Net income (loss)		$	(63)	$	139
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments		13		30
Net unrealized investment gains (losses)		(3,710)		(2,387)

Defined benefit pension and postretirement plan adjustments		—		—
Total other comprehensive income (loss), net of tax		(3,697)		(2,357)
Total comprehensive income (loss)		$	(3,760)	$	(2,218)

See accompanying notes to condensed consolidated financial statements (unaudited).

Table of Contents

REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(in millions except per share amounts)

(Unaudited)


	Reinsurance Group of America, Inc. Stockholders’ Equity
	Common Stock		Additional Paid In Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Income (Loss)		Total RGA, Inc. Stockholders’ Equity		Noncontrolling Interest		Total Equity
Balance, December 31, 2021	$	1	$	2,461	$	8,563	$	(1,653)	$	3,642	$	13,014	$	—	$	13,014
Issuance of preferred interests by subsidiary											—		90		90
Net income					(63)						(63)				(63)
Total other comprehensive income (loss)									(3,697)		(3,697)				(3,697)
Dividends to stockholders, $0.73 per share					(49)						(49)				(49)
Purchase of treasury stock							(27)				(27)				(27)
Reissuance of treasury stock			4		(5)		5				4				4
Balance, March 31, 2022	$	1	$	2,465	$	8,446	$	(1,675)	$	(55)	$	9,182	$	90	$	9,272


	Reinsurance Group of America, Inc. Stockholders’ Equity
	Common Stock		Additional Paid In Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Income (Loss)		Total RGA, Inc. Stockholders’ Equity		Noncontrolling Interest		Total Equity
Balance, December 31, 2020	$	1	$	2,406	$	8,148	$	(1,562)	$	5,359	$	14,352	$	—	$	14,352
Issuance of preferred interests by subsidiary											—				—
Net income					139						139				139
Total other comprehensive income (loss)									(2,357)		(2,357)				(2,357)
Dividends to stockholders, $0.70 per share					(48)						(48)				(48)
Purchase of treasury stock							(1)				(1)				(1)
Reissuance of treasury stock			5		(4)		4				5				5
Balance, March 31, 2021	$	1	$	2,411	$	8,235	$	(1,559)	$	3,002	$	12,090	$	—	$	12,090

See accompanying notes to condensed consolidated financial statements (unaudited).

Table of Contents

REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

(Unaudited)


	Three months ended March 31,
	2022	2021
















Net cash provided by operating activities	163	2,366
Cash Flows from Investing Activities:
Sales of fixed maturity securities available-for-sale	2,608	2,738
Maturities of fixed maturity securities available-for-sale	228	216
Sales of equity securities	4	1
Principal payments on mortgage loans on real estate	188

REINSURANCE GROUP OF AMERICA INC [RGA] Filings
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