Brookfield Asset Management Q1 2025 Earnings Report

Brookfield Asset Management EPS Results

• Actual EPS: $0.40
• Consensus EPS: $0.40
• Beat/Miss: Met Expectations
• One Year Ago EPS: N/A

Brookfield Asset Management Revenue Results

• Actual Revenue: $1.04 billion
• Expected Revenue: $1.29 billion
• Beat/Miss: Missed by -$252.96 million
• YoY Revenue Growth: N/A

Brookfield Asset Management Announcement Details

• Quarter: Q1 2025
• Date: 5/6/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, May 6, 2025
• Conference Call Time: 11:00AM ET

Brookfield Asset Management (NYSE:BAM) is a real estate investment firm specializing in alternative asset management services. Its renewable power and transition business includes the operates in the hydroelectric, wind, solar, distributed generation, and sustainable solution sector. The company's infrastructure business engages in the utilities, transport, midstream, and data infrastructure sectors. In addition, its private equity business offers industrial, infrastructure, and business services sectors; and real estate business, which includes housing, logistics, hospitality, science and innovation, office, and retail sectors. Further, it provides credit business; and insurance solution in the reinsurance, annuities, operating platform, and investment solutions sectors. Brookfield Asset Management Ltd. was incorporated in 2022 and is headquartered in Toronto, Canada.

Brookfield Asset Management Q1 2025 Earnings Call Transcript

Key Takeaways

• Brookfield delivered record fee related earnings of $698 million (up 26% y-o-y) and distributable earnings of $654 million (up 20%) in Q1.
• The firm raised $25 billion of new capital in the quarter, bringing 12-month inflows to over $140 billion and setting up its largest-ever real estate flagship at $16 billion.
• Brookfield deployed $16 billion into global opportunities and monetized $22 billion of assets to generate $9 billion of equity proceeds, reflecting strong execution in a volatile market.
• Leveraging its unmatched scale, diversification and global platform, Brookfield is well positioned to capitalize on secular trends like AI infrastructure, energy demand and private credit growth.
• The company bolstered its balance sheet with a $750 million inaugural bond offering at investment-grade ratings, while maintaining a $1.4 billion liquidity cushion and returning capital through dividends and share buybacks.

Presentation

[Operator]

and thank you for standing by. Welcome to the Brookfield Asset Management First Quarter twenty twenty five Earnings Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. To withdraw your question, please press 11 again.

[Operator]

Please be advised that today's conference is being recorded. I'd now like to hand the conference over to Jason Fuchs, Managing Director, Investor Relations. Please go ahead.

[Jason Fooks, MD & Investor Relations at Brookfield Asset Management]

Thank you for joining us today for Brookfield Asset Management's earnings call. On the call today, we have Bruce Flatt, our Chief Executive Officer Connor Teske, our President and Hadley Peer Marshall, our Chief Financial Officer. Bruce will start the call today with an overview of the quarter and then cover how our scale and strategy position us well to navigate the current market environment and to continue to deliver long term growth. Conor will follow-up and cover how our platform and ecosystem give us a strategic advantage in capital raising and deployment. And finally, Hadley will discuss our financial results, balance sheet strength and recent strategic initiatives.

[Jason Fooks, MD & Investor Relations at Brookfield Asset Management]

After our formal comments, we'll turn the call over to the operator and take analyst questions. In order to accommodate all those who want to ask questions, we ask that you refrain from asking more than two questions at one time. If you have additional questions, please rejoin the queue, and we'll be happy to take additional questions at the end if time permits. Before we begin, I'd like to remind you that in today's comments, including in responding to questions and in discussing new initiatives and our financial and operating performance, we may make forward looking statements, including forward looking statements within the meaning of applicable U. S.

[Jason Fooks, MD & Investor Relations at Brookfield Asset Management]

And Canadian securities law. These statements reflect predictions of future events and trends and do not relate to historic events. They're subject to known and unknown risks and the future events and results may differ materially from such statements. For further information on these risks and their potential impact on our company, please see our filings with securities regulators in The US and Canada and the information available on our website. And with that, I'll turn the call over to Bruce.

[Bruce Flatt, Chief Executive Officer at Brookfield Asset Management]

Thank you, Jason and to everyone joining us on the call. We had a strong start to the year marking our highest quarterly earnings growth since we went public. Fee related earnings reached a record $698,000,000 for the quarter, up 26% year over year or $0.43 per share. Distributable earnings grew by 20% to $654,000,000 or zero four zero dollars per share. Fee bearing capital now stands at approximately $550,000,000,000 up 20% compared to last year.

[Bruce Flatt, Chief Executive Officer at Brookfield Asset Management]

This performance reflects the continued strength and global reach of our business. We raised £25,000,000,000 of capital this quarter, bringing total inflows over the past year to more than $140,000,000,000 Importantly, and exemplifying the resilience of our business, we closed $6,000,000,000 of commitments during the first quarter for our flagship real estate strategy, bringing total capital to 16,000,000,000. And when we round out the strategy with the last retail and regional sleeves, this will be our largest real estate strategy ever. We also had a final close of our opportunistic credit strategy on par with our largest ever for this strategy at $16,000,000,000 We are very active on the deployment and monetization front as well. In total, we deployed $16,000,000,000 into opportunities globally and we sold $22,000,000,000 of assets.

[Bruce Flatt, Chief Executive Officer at Brookfield Asset Management]

This generated $9,000,000,000 of equity proceeds during the quarter. Together, these results demonstrate the strength and the resilience of our platform even in a volatile environment. Recently, the broader market faced heightened volatility and equity markets reacted sharply. Despite this, we remain confident in our long term strategy as the secular trends underpinning our business continue to accelerate. Whether it's the growth in demand for AI infrastructure, the rising global need for energy, or the increasing role private credit plays in capital markets, these trends continue to drive capital market flows globally.

[Bruce Flatt, Chief Executive Officer at Brookfield Asset Management]

We have leadership positions around these secular drivers having built deep expertise, operational capabilities and global scale. We believe we have never been better positioned to capitalize. The current environment favours scale, expertise and capital. Periods of uncertainty often lead to attractive opportunities as they can create compelling valuation and entry points for investors with scale and experience. This kind of environment is not too new to us.

[Bruce Flatt, Chief Executive Officer at Brookfield Asset Management]

We've navigated many similar challenges before. At the onset of COVID, we maintained our discipline, stayed focused on our long term strategy, and invested when many others hesitated. To make a point, since then, we have raised over $400,000,000,000 of capital, nearly doubled our fee related earnings and are now better positioned than ever before. Our franchise is more global, more diversified and more capable. At the centre of all of this is our investment and operating teams representing our capabilities in more than 30 countries.

[Bruce Flatt, Chief Executive Officer at Brookfield Asset Management]

This gives us unmatched flexibility to direct capital to the most attractive opportunities globally. We also have a high quality, durable earnings base to support the business. Our cash flows are 100% comprised of fee related earnings, of which approximately 95% are derived from capital that is either long term or perpetual in nature. This provides a stable and predictable foundation for distributable earnings. The ongoing growth of our fee bearing capital base supported by strong fundraising, deployment and monetization gives us conviction that these earnings will continue to compound over time irrespective of the environment.

[Bruce Flatt, Chief Executive Officer at Brookfield Asset Management]

Our investments are focused on essential assets, power, infrastructure, real estate and critical business services. These businesses operate locally, serve domestic demand and are often highly contracted or regulated. That makes them less exposed to global shocks and tariffs and more attractive in periods of uncertainty where investors seek consistency. We also benefit from our diversification across asset classes, allowing us to pivot to different strategies and across region. This ensures we can capitalize on dislocation whenever or wherever it may emerge.

[Bruce Flatt, Chief Executive Officer at Brookfield Asset Management]

Taken together, our client relationships, scale, brand, access to capital and long term track record enable us to maintain steady and growth through volatility. Looking ahead, our priorities are very clear. We will continue to stay disciplined. We'll lean into scale and with our capabilities, and we will continue to find opportunities in market dislocation. Our experience over many cycles has shown us that by focusing on these priorities in times of uncertainty not only helps us navigate through them but allows us to emerge stronger.

[Bruce Flatt, Chief Executive Officer at Brookfield Asset Management]

We expect to grow through this market cycle as we have in previous ones, just the same. I will now turn it over to Conor and Hadley who will go deeper into our portfolio, our liquidity position, capital allocation and the details of our recent deployment and monetization activities. Thank you all for joining us today.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

Thank you, Bruce and good morning to everyone on the call. As Bruce outlined, the past few months have seen heightened uncertainty and while public markets have experienced swings, private markets have remained relatively stable. During these periods, investors turned to proven global platforms with strong track records and trusted partnerships. That has always been a core strength of Brookfield. While parts of the industry may be more directly affected by today's volatility, our diversification across strategies, sectors and geographies continues to give us a competitive edge and the ability to extend our lead.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

These competitive advantages were illustrated by our successful fundraise for our real estate strategy this quarter. Despite a more challenging fundraising environment for real estate in recent years, we secured commitments from many of the world's largest and most sophisticated investors demonstrating their strong conviction in our strategy and platform and providing us with substantial fresh capital to invest at an especially attractive point in the cycle. These results reinforce why we believe our platform across segments is uniquely positioned to thrive. Our scale, diversification and long term relationships allow us to continue raising and investing capital behind the global secular trends of decarbonisation, deglobalisation and digitalization, as well as the growing role of private credit. A key source of that advantage lies in the types of assets we own and operate.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

They are not only diversified, they are essential. Our portfolio is anchored in essential real assets and critical business services sectors that have historically demonstrated strong resilience through economic cycles. While no business is entirely immune to broader market forces, the nature of our assets provides resiliency to these short term headwinds. Many benefit from inflation linked revenues or regulated pricing structures, which allow us to effectively manage rising input costs and preserve cash flows. We saw this play out during the recent inflationary cycle.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

Cash flows across much of our portfolio not only kept pace with, but in many cases outperformed inflation. We've also been preparing for macro shifts like deglobalization for several years. This has led to large and attractive investment opportunities to help corporates increase manufacturing of critical goods and services closer to home, as well as invest in the resiliency of their supply chain. Within our existing businesses, in anticipation of a more protectionist policy environment, we proactively restructured supply chains and procurement strategies to further bolster this resilience. For instance, in our renewables business, where tariffs have been in place for years, we have adopted a domestic procurement strategy supported by long term local supplier agreements.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

These actions offer significant cost certainty and put us in a comparatively stronger position versus many others who did not. Periods of uncertainty have also historically created some of the most compelling opportunities to deploy capital, especially for firms like us with the scale, structure and conviction to act decisively, providing execution certainty. Colonial Pipeline fits this type of deployment. We were able to use our scale capital to limit competition, provide execution certainty that was especially critical in this environment and value this world class midstream asset backed by high quality cash flows with discipline. And we are well positioned to continue deploying capital into this environment.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

We have nearly a £120,000,000,000 of uncalled long term oriented capital ready to deploy. Across many markets today, the headlines do not reflect the underlying fundamentals and that disconnect is creating compelling opportunities. Our ecosystem gives us real time access to data, insights and operating feedback from across our global portfolio, which allows us to see through the noise, identify value and move decisively. This is especially important in a market where volatility is pressuring public valuations, creating entry points that are only accessible to those with true on the ground visibility. We fully intend to capitalize on that positioning.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

And while capital is critical, it's our platform's breadth and reputation that unlock differentiated access to opportunities that others may not see. We are increasingly seeing the most sophisticated governments, corporates and institutions turning to private capital to pursue strategic initiatives. They are choosing Brookfield because we can deliver not only capital at scale, but operating experience, speed, certainty and a proven ability to execute complex transactions. This quarter, we announced a 20,000,000,000 Euro AI infrastructure commitment alongside the French government and a strategic partnership with Barclays to help it scale its payments platform. Similar to previous partnerships with Intel, Microsoft, Deutsche Telekom and others, these are further examples of our platform's approach to partnerships, which create differentiated proprietary transactions that we are uniquely positioned to execute.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

Another area where we see tremendous opportunity is private credit. This is an area where we've been rapidly expanding. With over $320,000,000,000 in credit AUM today, we now operate one of the largest private credit businesses globally, leveraging our expertise in real asset, corporate and opportunistic credit and we're just getting started. Our

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

goal is to

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

more than double the size of our credit business over the next five years. Periods of illiquidity make our capital even more valuable as private credit fills funding gaps left by traditional lenders and public markets. The pullback from these sources is part of a longer structural trend. It is creating a significant opportunity for our private credit strategies to play an even more meaningful role in providing liquidity when there is less available, allowing us to generate higher returns for lower risk. This opportunity is particularly available to those with leading market knowledge and underwriting capabilities in these market segments, a position where we are unmatched.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

Over recent quarters, we've made meaningful strategic advancements to complement our existing direct investment capabilities and broaden our platform to meet this rising demand. Over the past couple of months, we acquired a majority stake in Angel Oak, a leading specialized mortgage origination platform and asset manager with more than $18,000,000,000 of assets under management. This platform adds deep origination capabilities and significantly expands our presence in The U. S. Mortgage market.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

We also increased our ownership stake in Oaktree by 1.5%, raising our total ownership stake to approximately 74% underscoring our long term commitment to our partnership. With fundraising now complete for the latest vintage of our highly successful opportunistic strategy, Oaktree is similarly well positioned to capitalize with significant capital to deploy in this environment. Moments like this are where Oaktree's long standing disciplined and value oriented approach is particularly powerful. Throughout every cycle in our history, we have successfully turned volatility into opportunity. We believe this time will be no different.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

We have the capital, relationships and track record to move with conviction when others can't and will do so in a disciplined manner and at scale. This environment plays to our strengths and as the environment continues to evolve, our global reach, diversified strategies and long term mindset positions us to deliver sustainable, attractive returns for our clients. With that, we will turn the call over to Hadley to cover our financial results.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

Thank you, Conor. Today, I'll cover our first quarter performance, fundraising, deployment and monetization activity. I'll then highlight some of the strategic initiatives we have recently undertaken, including bolstering our balance sheet with an inaugural bond offering backed by our recently obtained high investment grade ratings, as well as our recent opportunistic repurchase of shares. First, on our financial performance, we had another record quarter of earnings. Fee related earnings, or FRE, were $698,000,000 or $0.43 per share in the quarter, up 26% from the prior year period, bringing FRE over the last twelve months to $2,600,000,000 Distributable earnings, or DE, were $654,000,000 or $0.40 per share in the quarter, up 20% from the prior year period, bringing the last twelve months to $2,500,000,000 Growth in our earnings is largely attributed to our fee bearing capital base, which currently stands at $549,000,000,000 a 20% increase from the prior year period.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

This increase is due to two primary sources: fundraising and capital deployment. Over the past twelve months, we raised $142,000,000,000 of which 80% began generating fees in the period. In addition, dollars 18,000,000,000 of our fee bearing capital inflows came from the capital that was deployed over the last twelve months. These inflows were partially offset by $21,000,000,000 of capital returned to clients through distributions from our private funds and permanent capital vehicles. In a market when many sponsors are struggling to generate distribution to paid in capital, or DPI, this level of distribution reinforces the strength of our business.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

Returning capital is fundamental to the investment cycle, and our ability to do so consistently supports our track record of delivering value through both dividends and monetization. Capital formation remained strong in the first quarter. We raised $25,000,000,000 diversified across our flagship strategies, complementary funds, and partner managers. Some of the highlights include in real estate. We raised $7,100,000,000 including $5,900,000,000 for the fifth vintage of our flagship real estate strategy.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

As mentioned, this is set to be our largest flagship real estate strategy ever. In Renewable Power and Transition business, we raised $1,500,000,000 including $700,000,000 for the second vintage of our global transition strategy, bringing total capital raised for that strategy to over $14,000,000,000 We expect to hold a final close for this strategy in the coming months. And in credit, we raised $14,000,000,000 including $6,300,000,000 across our partner managers and $6,700,000,000 from our insurance accounts. We also completed the final close for the twelfth vintage of our flagship opportunistic credit fund, bringing total capital raised for that strategy to $16,000,000,000 Overall, we have never been more diversified in our fundraising, with more than 40 strategies raising capital during the quarter. This is a direct result of significant investments we've made in our people and products over the past couple of years, building out fundraising teams and supporting platforms to invest capital.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

The best is yet to come from these efforts, and we expect to see continued growth and expansion in our business, both throughout the remainder of 2025 and the years to come. As we complete final closings for our real estate and transition flagships in the coming months, we expect complementary strategies to drive an increasing share of fundraising in the second half of the year. We also continue to see strong deployment activity, investing $16,000,000,000 during the quarter. As Conor mentioned, we have significant available capital and intend to be active in the market as uncertainty creates opportunities. A few notable large scale transactions that were either signed or closed in the first quarter include: In our renewable power and transition business, we invested over 3,000,000,000 to complete the privatization of Neowin, a leading global renewable energy developer.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

We also committed $1,200,000,000 to acquire The U. S. Renewables business of National Grid. This transaction is expected to close in the second quarter of twenty twenty five. In our private equity business, we deployed approximately $1,000,000,000 to acquire Chemilex, a global leader in the design and manufacturing of electric heat trace systems.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

We also committed $800,000,000 toward the acquisition of Antilia Scientific, a leading manufacturer and distributor of specialty consumable products and testing equipment used in quality control and research applications. The deal will close in the second quarter of twenty twenty five. After quarter end, our infrastructure business signed an agreement to acquire the midstream asset portfolio of Colonial Enterprises for $3,400,000,000 of equity capital, representing $9,000,000,000 of enterprise value. The portfolio includes the Colonial Pipeline, the largest refined products pipeline in The United States, and is expected to close in the second half of twenty twenty five. Let me turn to our balance sheet and liquidity.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

When we spun out Brookfield Asset Management two and a half years ago, our model was, and remains, simple and focused. We are a premier alternative asset manager with a strong asset like balance sheet. We selectively use our balance sheet for two purposes: one, to pursue strategic acquisitions that expand our capabilities and two, to provide seed capital for the creation of new complementary investment products that will grow and become meaningful revenue generators over time. Since that time, we strengthened our platform through new partnerships with three leading managers: Castlelake, Pine Grove, and most recently, Angel Oak, and by increasing our ownership in Oaktree. Altogether, in these, we invested 1,400,000,000 We also have existing options in place that provide a clear path to increase our ownership in all of our partner managers over time.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

These options should add more than $250,000,000 to our fee related earnings over the next five years. This is a meaningful advantage for our business and allows us to increase our ownership in high quality businesses we know well, deepening alignment, building on an already strong foundation, and positioning us to drive further growth over time. At the same time, we continue to demonstrate strong alignment with our clients by investing meaningful capital alongside them. Since our spinout, the Brookfield Group, that is all the Brookfield affiliates, including Brookfield Asset Management, have collectively committed $16,000,000,000 to our fund, with our Brookfield Asset Management share of $1,300,000,000 focused primarily on ceding smaller, new complementary strategies. Overall, our access to liquidity remains strong.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

We're a top tier client for our banks and continue to maintain a diversified mix of funding sources. To support our growth initiatives, we completed our inaugural bond offering in April, issuing $750,000,000 of ten year senior unsecured notes with a coupon of 5.795%. This offering received exceptionally strong demand from the market, more than seven times oversubscribed, and we were able to tighten pricing and upsize materially, reflecting investor confidence in our differentiated business, stable earnings profile, and long term capital base. In connection with the offering, we received high investment grade ratings of A from Fitch and A- from S and P, underscoring the strength of our asset light model and the durability of long term earnings. At the end of the quarter, we had $1,400,000,000 of available liquidity, comprising cash, financial assets, and capacity on our revolving credit facility.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

This does not count our recent bond issuance nor the capacity at these ratings of over $4,000,000,000 of additional debt capacity. Our goal is to generate increasing cash flows on a per share basis and to distribute that cash to you by dividend or share repurchases. I'm pleased to confirm that the Board approved our quarterly dividend of 43.75¢ per share payable on 06/30/2025 to shareholders of record as of the close of business on 05/30/2025. In addition, we repurchased 2,100,000.0 shares of Brookfield Asset Management during the quarter when our stock traded lower in line with the broader market. Given our strong outlook, these were easy purchases to make.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

In short, our balance sheet is strong and our access to capital is robust. This supports our continued momentum and leaves us well positioned in the current market. We remain committed to being a world class asset manager by investing our capital in high quality assets that earn attractive returns while emphasizing downside protection. This wraps up our remarks for this morning. We would like to thank you for joining the call and we'll now open it up for questions.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

Operator?

[Operator]

Our first question comes from Craig Siegenthaler with Bank of America.

[Craig Siegenthaler, Analyst at Bank of America]

Good morning, everyone. We wanted to start with fundraising and specifically real estate Fund V. So we all know real estate isn't the easiest vertical to fundraise today, but you already raised $13,000,000,000 So that's a pretty impressive number just given the backdrop. And I'm curious which geographies channels were helpful for this raise to date? And did the opportunistic element really sell with clients given very limited new construction and the migration of capital away from this vertical?

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

Good morning, Craig. I'll start by just correcting you in a positive way. We've already raised $16,000,000,000 for the strategy. So it's well on track to be our largest real estate strategy raise ever. And it's really capitalizing on, I would say, three things that you mentioned there.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

One, the fundamentals are incredibly strong right now. The world needs more great real estate, but there is a very significant lack of new supply in major markets and high quality assets around the world that it's creating a very robust supply demand dynamic in those who can bring capital to the market. The second thing is there is no doubt some legacy capital structures that are not well suited for the current interest rate environment and that's going to create very attractive opportunities to buy high quality assets within perfect capital structures at significant discounts to replacement costs. And that's actually what this strategy already has been doing early in its vintage. And then the last point is very much that while different asset classes in different geographies around the world in the real estate cycle will trough at different points in time.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

The strength of this fundraise was very indicative that investors realized this fund will deploy capital from twelve months ago to two or three years into the future. And no doubt, we are going to catch the bottom during that timeframe. And that made this a vintage that many of our most sophisticated and large scale partners did not want to miss. Maybe just to close out in terms of where we saw significant demand this quarter, very broad based, but I would highlight strength in The U. S.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

Market.

[Craig Siegenthaler, Analyst at Bank of America]

Interesting. U. S. Market, Connor, I wasn't expecting that one. But let me go for my follow-up into BII, your private wealth infrastructure fund.

[Craig Siegenthaler, Analyst at Bank of America]

It launched like seventeen months ago and you haven't had a down month. So on the distribution front, what channels, geographies is it in today? And do you see any sizable platform adds coming in 2025?

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

Great. So BII continues to show and I would say just in terms of our growth through retail and high net worth, even since Investor Day when we profiled this business, we're even more optimistic today about the growth trajectory going forward. In terms of how we've approached retail and high net worth, very similar to what we've done in our institutional business. We very much focused on being globally diversified. We feel that's particularly important for these types of products that do offer semi liquidity to the investors that we feel having a diverse investor base is the right way to build the strategy over the long term.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

And then just in terms of the performance, we expect more of that to come. We're leveraging our best in class infrastructure platform and building a portfolio of exceptionally high quality assets that work well in a perpetual vehicle like BII.

[Craig Siegenthaler, Analyst at Bank of America]

Thanks, Connor.

[Operator]

Our next question comes from Cherilyn Radbourne with TD Cowen.

[Cherilyn Radbourne, Managing Director - Equity Research at TD Securities]

Thanks very much, and good morning. Wanted to start by asking a question about your perspective on some of the new product introductions across the industry, which kind of blur the lines between public and private assets. Is that something that you're working on from a product development perspective?

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

First and foremost, the headlines and some of the partnerships you see being announced and in particular, the interactions between more traditional securities managers and alternative managers, we think underscores an incredibly large and important trend, which is that alternatives are increasingly becoming part of a standard investment portfolio for all types of investors. A decade ago, it was only institutional investors who invested in alternatives, then insurance companies. Now we're seeing it across retail high net worth and the more common investor. It's no longer just stocks and bonds. It's now stocks, bonds and alternatives.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

And in terms of those types of partnerships, we of course are monitoring that space carefully and having a number of conversations of our own. And we will look to build our business appropriately. We view this as a long game and it is something we would consider in the future.

[Cherilyn Radbourne, Managing Director - Equity Research at TD Securities]

Thank you. And secondly, I think the plan had been to launch your next flagship PE fund in 2025. Is that still your expectation? And do you think BAM has enough of a differentiated strategy in PE to attract new and existing clients?

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

We are extremely confident about our PE strategy, particularly in the current market. And as a reminder, we have a differentiated approach to private equity versus many in the space. In that, our approach to private equity is focused on driving value using operational enhancement. Our business is far less growth oriented and far less capital markets focused than some, I'll say it more stereotypical private equity approaches. And we feel that is perfectly suited for the current market.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

And that's not just a sentiment, we're seeing it in our business. Anuj Ranjan, who runs our private equity business has been on record in saying it's been the most active start our private equity business has ever had, whether it's the transactions with Antilia or Chemelux or Spring Education. All of that is showing that our approach to private equity is well suited to the current market. And therefore, we do continue to expect to launch the next vintage of our flagship private equity fund at some point this year. In terms of the timing of the first close, hey, it may tip this side of the calendar year, it may tip the next side of the calendar year.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

But the momentum in that strategy and the track record is very strong.

[Cherilyn Radbourne, Managing Director - Equity Research at TD Securities]

Thank you.

[Operator]

Our next question comes from Alexander Blostein with Goldman Sachs.

[Alex Blostein, Analyst at Goldman Sachs]

Hi, good morning everybody. Maybe just zooming out a little bit and a question on broader fundraising across the platform. You guys had a very strong start to the year at $25,000,000,000 in the first quarter. I think on the last call, we talked about organic capital raising, in 2025 being a bit better than it was in 2024, excluding obviously the insurance deal, which I think puts you, something in the high 80s to $90,000,000,000 range. So given the uncertain environment, but obviously momentum in the business is pretty good.

[Alex Blostein, Analyst at Goldman Sachs]

Maybe help us kind of re underwrite that. How are you thinking about fundraising through the rest of the year? And how much of that, call it, high 80s billion do you think ultimately will be fee paying? Thanks.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

There is nothing we see in the current market that would cause us to change the forecast that we at the year. Obviously, things like the strength we've seen in real estate, finishing off the flagships in transition, closing with a record number for Oaktree's ops fund. We remain confident in the number that we outlined at the beginning of the year. And maybe just to overlay that versus the current environment. Yes, there is more uncertainty than there was six or eight weeks ago.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

But this is also the environment where being partnered with a large scale manager like Brookfield allows investors the opportunity to capitalize on some of the investment opportunities that may surface in this environment. And we do expect the current uncertainty in the environment to only exacerbate the flows of capital to the largest most established managers with the largest execution capabilities and the greatest track record. So nothing we've seen to start the year would cause us to change our fundraising forecast.

[Alex Blostein, Analyst at Goldman Sachs]

Perfect. That's great to hear. Hadley, one for you on just broader balance sheet management. Obviously, so you guys do the debt offering a couple of weeks ago. Maybe help us just sort of frame how you think about the appropriate amount of leverage at the firm that you've been a stand alone public company for a little while.

[Alex Blostein, Analyst at Goldman Sachs]

And similarly on the buyback, very encouraging to see you guys step up here given the volatility in the market. Should we be thinking about share repurchases as more of an ongoing part of kind of EPS growth algorithm for the firm going forward?

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

Thanks, Alex. We were very excited to enter the market. As everyone appreciates, this is our first bond deal, and we did it as an SEC registered bond. And we found a window where we got very attractive demand and pricing attached to that bond. Under our existing ratings, Fitch, which is A and S and P, which is A minus, we have a lot of capacity, two times DE.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

So that puts us in a position to really allow that to grow over time. And that capacity also grows over time because our business is growing. So we have ample room from that perspective. And as a reminder, the use of proceeds is around our complementary strategies and supporting the growth of the business attached to those product offerings. And then of course, M and A, whether it's within our current partner managers or additional ones that we may partner with to complement our existing capabilities.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

So when we look forward, we do anticipate being a repeat issuer and making sure that we have liquidity to support the growth of the business. But we've already built up, we've got $1,400,000,000 plus the bond offering proceeds and the upsizing at $750,000,000 So that puts us in a good position to also think strategically about share repurchases when we see times where we want to support our stock and we see good value attached to those purchases, which is what we did earlier in the year when we bought back about $50,000,000 So it just again continues to strengthen our liquidity position because our balance sheet and liquidity is a competitive advantage of ours and it will really support the growth that we see going forward.

[Alex Blostein, Analyst at Goldman Sachs]

Great. Thank you very much.

[Operator]

Our next question comes from Robert Kwan with RBC Capital Markets.

[Robert Kwan, Global Head - Power, Utilities & Infrastructure Research at RBC Capital Markets]

Great. Thank you. Good morning. Just in the uncertain and volatile environment like we have, you know, historically, Brookfield's taken the contrarian approach and confidently put money to work. In your letter comments today, you're saying the environment's playing to your strengths.

[Robert Kwan, Global Head - Power, Utilities & Infrastructure Research at RBC Capital Markets]

And so just what segments and geographies are you seeing market dislocations or are you positioning for significant opportunities to arise?

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

We expect to be very active. And in terms of where we're seeing the opportunities across the portfolio, I would say right now it's very broad based, but I would highlight maybe two or three themes that we're our verticals and across asset classes. One is the uncertainty in the public markets is very exacerbated versus the demand we are seeing in private markets. And when you make a comment like that, everyone's head immediately goes to take private. And those types of opportunities may originate over time, but it also really lends itself to carve outs.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

And we're seeing more and more opportunities to do carve outs and partnerships going forward. The second thing that we would say that we are seeing across all of our verticals is the opportunity to do structured investments, particularly when counterparties may not have access to the public capital markets the way they have in the past. That's working really well for our structured investment strategies, whether it be across infrastructure, it be across private equity. And then the last one that just goes without saying is this is the environment where Oaktree goes to work. And this is perfectly suited to their approach and that's been proven over cycles and we're excited to see what our partners can do there as well.

[Robert Kwan, Global Head - Power, Utilities & Infrastructure Research at RBC Capital Markets]

That's great. Thank you. And then if I just finish here on fundraising with the largest real estate flagship closed and the global transition tracking really nicely here. Can you just speak to what these types of results say about the fundraising environment, the allocation to all your market share and the allocation that you're seeing to the various subsectors by your institutional and by the LPs?

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

There's a lot of headlines and we try and keep our head town and focus on the long term and tune out the noise. The overarching trends is there is absolutely a greater allocation to alternatives today than ever before. And that's only going to continue going forward. And similarly, that allocation is increasingly being concentrated within the largest managers who have the best track records, the largest capabilities and can offer the broadest suite of products. While there are short term headlines that may create some periodic uncertainty.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

Those trends are very robust and very enduring. I think that's what you're seeing in our most recent flagship fundraisers and we expect it to continue going forward.

[Robert Kwan, Global Head - Power, Utilities & Infrastructure Research at RBC Capital Markets]

That's great. Thank you very much.

[Operator]

Our next question comes from Ben Rubin with UBS.

[Benjamin Rubin, Director, Equity Research at UBS Group]

Great. Thank you for taking my questions. For my first one, I have a two parter on private credit. We're starting to hear some concerns around potential overcrowding or saturation within private credit as an asset class and direct lending more specifically. Is that a theme you're seeing as well across your business?

[Benjamin Rubin, Director, Equity Research at UBS Group]

Or is your focus on asset backed lending and financing real assets less impacted from some of this broader competition we're hearing about? And then secondarily, could you just expand on what Angelo Oak adds to your platform and then how kind of the mortgage origination component fits within your larger push into managed insurance? Thank you.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

Yes. Actually, can take that one and tie it in nicely with Angelic. So when you think about our $300,000,000,000 of assets under management within our credit business, it is heavily focused on opportunistic and real assets, including real estate infrastructure and ABF. And so that puts us in a position to really be able to capitalize on the value add that we can bring to the market. And especially in this environment, as Conor was mentioning, the dislocation makes our capital and that specific type of capital even more valuable.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

And so we're seeing a strong pipeline of opportunities. The deployment has been quite strong. And we are also very focused on continuing to build out our strategies attached to credit, which takes us to Angelo. Angelo is actually fits perfectly into the type of credit that we focus on and is actually well positioned to benefit especially our clients associated with insurance. So the non qualified side of the mortgage space is quite attractive and we are excited to have them once we close as part of the overall partner manager group as we continue to expand our capabilities.

[Benjamin Rubin, Director, Equity Research at UBS Group]

Great, thanks. Another question here for you Hadley. In 1Q, your FRE margins expanded 300 basis points to 57%, although the catch up fees from your real estate flagship certainly helped. I know a lot of the investment spend behind your insurance platform is now behind you, but how should we think about the potential expense growth or trajectory or spending for the remainder of this year? Thank you.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

Vindi, you do see the operating leverage with that 300 basis point improvement year over year. So that operating leverage of the growth that we've been focused on continues to be a benefit to our business. And that will continue to play out as well. But we are still doing some building, especially as we further expand our credit capabilities and our fundraising channels. And so that's important and an area that we think is quite valuable investing in.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

And then we'll continue to benefit in that operating leverage to hit our long term stride of around 60%.

[Benjamin Rubin, Director, Equity Research at UBS Group]

Great. Thank you for taking my questions.

[Operator]

Our next question comes from Michael Cyprys with Morgan Stanley.

[Michael Cyprys, Analyst at Morgan Stanley]

Hey, good morning. Thanks for taking the question. Given the significant growth that we've seen across your credit platform with large insurance customers, just curious how you're thinking about the opportunity set for building out a capital markets business alongside as we've seen some others across the industry monetize origination flow, credit and broader connectivity with insurance. So just curious how you're thinking about this potential fee generating opportunity for Brookfield and what it

[Michael Cyprys, Analyst at Morgan Stanley]

would take to build this out?

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

We absolutely are thinking about it. It is now part of our business plan. This is the first year that we focused on building that into our business. And we do think it can be a modest driver of incremental fee revenue going forward. The one point I would highlight is none of that was included in our five year plan that we presented at Investor Day.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

So it is something that we are now focused on. We do think it can increase into something meaningful into the low hundreds of millions over the next four or five years, but it's not something that we previously included in our forecast.

[Michael Cyprys, Analyst at Morgan Stanley]

Great. Thank you. And then just a follow-up question on capital allocation. I think the dividend payout ratio was a little over 100% in the quarter. So just curious how you're thinking about the dividend on a multi year basis.

[Michael Cyprys, Analyst at Morgan Stanley]

Is the intention to grow that in line with earnings growth? Or are you thinking about targeting a certain payout over time? And then could you maybe just speak to the buybacks in the quarter as well and how we should think about that going forward too? Thank you.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

So in terms of the dividend, we expect to pay out north of 90% of our distributed earnings. And yes, we are a little bit above that in Q1, but I think the read through there is it should give you an indication of the visibility and confidence we have in the earnings growth for the rest of the year. We've been building our business. We've had some nice step changes with some of the flagships coming on. You saw that in Q3, you saw that in Q4, you see it again in Q1, we expect that momentum to continue into Q2 and obviously compound through the end of the year.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

And then in terms of the buybacks, we will be opportunistic. As Hadley mentioned, we have an extremely robust balance sheet and therefore when we see value in our shares, we're not going to hesitate.

[Michael Cyprys, Analyst at Morgan Stanley]

Great. Thank you.

[Operator]

Our next question comes from Mario Saric with Scotiabank.

[Mario Saric, Analyst at Scotiobank]

Good morning, and thanks for taking the question. The first one is a bit

[Mario Saric, Analyst at Scotiobank]

more of a thematic one, focused on

[Mario Saric, Analyst at Scotiobank]

The U. S. Like the

[Mario Saric, Analyst at Scotiobank]

tariff volatility that we've seen has raised some questions about the leading global role that is played by The US. It doesn't seem to have been impacted or have impacted your LP commitments to BSREF bias, you noted. But high level, can you talk about any notable trends and how LPs are thinking about future U. S. Commitments in a post Liberation Day world?

[Mario Saric, Analyst at Scotiobank]

And secondarily, do recent developments at all change your desired global allocation mix going forward?

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

So in terms of fundraising and allocations from investors, we like to think we have one of, if not the most diversified LP base around the world. And while it would be reckless to diminish the impact of tariffs and what they've done to markets, we really don't see it changing our fundraising trajectory. Any changes in allocations are going to be de minimis and on the margin. In terms of just our assets and what we see in terms of allocating capital, we think this actually plays to our strengths. This is going to lead to a focus on energy security, focus on data security, a focus on on shoring and de globalization.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

This requires huge amounts of capital. And as one of the largest managers and custodians of that type of capital around the world, we actually think that this environment maybe not week to week, but over months and quarters is going to create an even bigger opportunity for our franchise.

[Mario Saric, Analyst at Scotiobank]

Okay. My second question, maybe for Hadley, as new complementary funds are launched, BAM itself may increasingly become the Brookfield co investment in these funds. Is there a reasonable range of annual co invest capital that we should think about as it pertains to Brookfield or BAM specifically over the next, say, three to five years?

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

When we think about our complementary strategies, we've made sure that Brookfield Asset Management can support more of the equity complementary strategies. The credit complementary strategies are typically supported by our IMA with Brookfield Wealth Solutions. So it really is a subset of the overall complementary strategies from that perspective. So just one data point to keep in mind. In terms of we look forward, as can as you know, we've got about 40 strategies in market now.

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

That's going to grow up to, call it, 80 strategies over the next five years. So we continue to see the expansion and the capital needs attached to that. But if I had to put a number, it's a handful of $100,000,000 It's like $500,000,000 or less attached to that.

[Mario Saric, Analyst at Scotiobank]

Perfect. Okay. Thank you.

[Operator]

Our next question comes from Ken Worthington with JPMorgan.

[Kenneth Worthington, Financial Analyst at JP Morgan]

Hi. Still good morning. So thanks for taking the question. I wanted to start by asking where the flagship funds stand in terms of percentage of capital invest and committed? And really interested in three, Infra five, Transition two and CapPartners six.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

Sure. So Infra five is on exactly 50%. BGTF-two

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

is

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

at 5,200,000,000.0 of $17,000,000,000 so call it about 33% and Brookfield Capital Partners, I believe that one's at about the 60% range.

[Kenneth Worthington, Financial Analyst at JP Morgan]

Okay, excellent. Thank you. And then the wealth solutions based management fee of $68,000,000 has been growing really nicely, but with IMAs really driving entirety of the increase over the past three quarters. Assets in private credit SMAs continues to rise, but the fees from investments has been very stable at $13,000,000 a quarter. Is this just a matter of wealth solution funds being committed, but not yet deployed in private credit?

[Kenneth Worthington, Financial Analyst at JP Morgan]

Or is there something else here? And then where do you expect solutions allocation to private credit to go as it reaches equilibrium? It keeps rising. Where does that get to?

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

So you're absolutely right around the dynamic there. When you look at the breakdown, I think the number of actually deployed capital is somewhere in the 3% range, maybe 3% to 4%. But maybe to put it in perspective, about 10% of the capital has been committed to those private strategies. It just is in the process of being deployed. The other thing that needs to be recognized as well, We continue to deploy that capital.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

We're also constantly writing new annuities and bringing new cash in that typically grows into liquids before being redeployed into a private strategy. So you're on a bit of a treadmill there, but the commitments are certainly higher and growing and that's being pushed through the system. We continue to expect the equilibrium to be somewhere in the 25% to one third range over time.

[Kenneth Worthington, Financial Analyst at JP Morgan]

Excellent. Thank you very much.

[Operator]

Our next question comes from Brian Bedell with Deutsche Bank.

[Brian Bedell, Director at Deutsche Bank Securities]

Great. Thanks. Thanks also. Good morning still. Thanks for taking my questions.

[Brian Bedell, Director at Deutsche Bank Securities]

Maybe just, Conor, one for you on deployment pace. So as we think about this backdrop that is it seems increasingly appealing for your deployment across a number of verticals. How do you think about the cycle times of deploying through these large funds that you've raised recently compared with cycle times and prior vintages. And the objective of the question is when would you get to the next vintage? And if I can put another angle on this question, how would your answer change if we were to say we were going to have a very distressed environment over the next few quarters versus not such a distressed environment?

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

Certainly. So typically for our flagships, look to deploy them over a three to maybe three point five year period. And that's a run rate in a normalized market kind of averaged across our various flagship strategies. In a more opportunistic and more distressed market, we absolutely would expect that deployment timeline to shorten, where we would put more capital to work at the low point in the cycle. That is where we do feel that our Brookfield ecosystem, our access to opportunities, our access to information can allow us to be active when maybe others are looking to hold back a little bit more.

[Connor Teskey, President and CEO of Renewable Power & Transition at Brookfield Asset Management]

In terms of what we're seeing in the current market, we would expect to be at our traditional run rate or inside of it certainly longer than average in this environment.

[Brian Bedell, Director at Deutsche Bank Securities]

Yes, that's great. And just a quick follow-up for Hadley. I think you mentioned increasing the ownership stakes in some of the partners. I think you mentioned that if you were to do that over time and to the full ownership stake, it would be about I think you said contribute about $250,000,000 to FRE, if I'm not mistaken. And the question there would be, does that include the Oaktree rate raising Oaktree or is it just the other partners?

[Hadley Peer Marshall, CFO & Managing Partner of Infrastructure at Brookfield Asset Management]

No. And you got the number right. Is $250,000,000 over a five year period. That includes all of our partner managers, including Oaktree.

[Brian Bedell, Director at Deutsche Bank Securities]

Okay. Great. Thank you.

[Operator]

That concludes today's question and answer session. I'd like to turn the call back to Jason Fuchs for closing remarks.

[Jason Fooks, MD & Investor Relations at Brookfield Asset Management]

Okay, great. If you should have any additional questions on today's release, please feel free to contact me directly. Thank you, everyone, for joining us.

[Operator]

This concludes today's conference call. Thank you for participating. You may now disconnect.

Participants

Executives

• Jason Fooks, MD & Investor Relations
• Bruce Flatt, Chief Executive Officer
• Connor Teskey, President and CEO of Renewable Power & Transition
• Hadley Peer Marshall, CFO & Managing Partner of Infrastructure

Analysts

• Craig Siegenthaler, Analyst at Bank of America
• Cherilyn Radbourne, Managing Director - Equity Research at TD Securities
• Alex Blostein, Analyst at Goldman Sachs
• Robert Kwan, Global Head - Power, Utilities & Infrastructure Research at RBC Capital Markets
• Benjamin Rubin, Director, Equity Research at UBS Group
• Michael Cyprys, Analyst at Morgan Stanley
• Mario Saric, Analyst at Scotiobank
• Kenneth Worthington, Financial Analyst at JP Morgan
• Brian Bedell, Director at Deutsche Bank Securities