Corebridge Financial NYSE: CRBG reported first-quarter 2026 results that executives said reflected resilient underlying performance amid market volatility, while management also outlined progress toward its planned merger with Equitable and highlighted customer experience investments across the organization.
Merger with Equitable: rationale, progress, and capital actions
President and CEO Marc Costantini said the planned combination with Equitable is intended to create a diversified financial services company with leading positions across retirement, life, wealth and asset management. Costantini said the combined company would have more than 12 million customers and $1.5 trillion in assets under management and administration, along with “a large multi-channel distribution ecosystem” and $500 million of targeted expense synergies, plus “meaningful upside opportunities” from revenue, tax and capital synergies.
Costantini also reiterated longer-term financial targets tied to the merger, including expectations that by 2027 earnings will exceed $5 billion per year and cash generation will exceed $4 billion per year. He said the transaction is expected to be immediately accretive to earnings per share and cash generation, with both increasing to 10% or more by year-end 2028.
On deal milestones, Costantini said Corebridge has completed “a vast majority” of regulatory filings and expects to file its Form S-4 with the SEC “shortly.” He added that integration management offices at both companies are planning for integration and capturing synergies, and that the executive team of the combined company “has been determined and will be communicated soon.”
In response to analyst questions, management emphasized it has not seen distribution partner pushback since announcing the transaction. Costantini said the company had considered potential “dyssynergies” and reached out to partners, but “we haven’t heard any…apprehension.” Interim CFO and Chief Accounting Officer Christopher Filiaggi added that overlap among the largest distributors on each side is “de minimis,” and said the firms view scale and manufacturing breadth as beneficial for advisors.
Costantini also addressed timing around share repurchases. He said Corebridge is exploring repurchases prior to deal close, including during the period between filing a preliminary proxy and mailing the final proxy, and expects another repurchase window after the shareholder vote in the summer, subject to blackout periods. He said any remaining planned capital deployment would likely occur post-close, “likely through an accelerated share repurchase.”
First-quarter results: VII weighed on headline metrics
Filiaggi said first-quarter performance was “largely in line with our guidance from the fourth quarter,” pointing to diversified earnings and active capital deployment balanced by expense control and portfolio optimization.
Corebridge reported adjusted pretax operating income of $629 million and earnings per share of $1.05. Filiaggi said results were impacted by underperformance in variable investment income (VII). Excluding VII and notable items, he said EPS increased 13% year-over-year, and he cited a “run rate operating EPS” of $1.17 when adjusting for long-term alternative investment returns and notable items, up 9% year-over-year. Adjusted return on equity was 10.6%, or about 12% on a run rate basis, he said.
Filiaggi said VII returns reflected “positive alternative investment returns” offset by unrealized mark-to-market losses on certain fair-value investments recorded in adjusted pretax operating income.
Chief Investment Officer Lisa Longino later provided additional detail, telling analysts the quarter included “non-recurring marks on otherwise fixed income assets that are held in vehicles” that run through operating income rather than OCI. She said those marks had reversed and that the company is “not expecting to see that again.” Longino added that VII looked “slightly better” heading into the second quarter, though “second quarter could be below expectations just given the volatility in the market.”
Business mix and segment trends
Filiaggi said core sources of income excluding alternatives and notable items increased 1% year-over-year, with fee income up 9% due to growth in assets under management and advisory and favorable market tailwinds. Spread income increased 1%, which he said aligned with guidance reflecting the impact of 2025 Federal Reserve rate cuts; he estimated base spread income would have been $20 million to $25 million higher absent those cuts. Underwriting margin declined 2% year-over-year due to “exceptionally favorable mortality” in the first quarter of 2025. General operating expenses were in line with expectations, reflecting platform investments and typical first-quarter seasonality.
- Individual Retirement: Premiums and deposits were $4.3 billion, with net flows into the general account positive at about $0.5 billion. Filiaggi said market share of total annuity sales was maintained year-over-year, citing LIMRA’s first-quarter industry projections. He reaffirmed the estimate for base spread income of approximately $2.55 billion for the full year and said spread compression is expected to level off by the end of 2026, assuming the current outlook and two additional Fed rate cuts.
- Group Retirement: Advisory and brokerage initiatives drove record AUMA and net flows of more than $300 million in the quarter, Filiaggi said. Adjusted pretax operating income declined 17% year-over-year, reflecting lower spread income partially offset by higher fee income, as the business shifts intentionally toward fee-based earnings. Costantini later told analysts the spread-to-fee transition could take another 12 to 24 months to work through, with merger-related cross-selling benefits likely taking hold after close and into 2027.
- Life Insurance: Filiaggi said results were in line with guidance and reflected higher seasonal mortality of $15 million to $20 million. Sales were $850 million, and adjusted pretax operating income declined 5% year-over-year, with mortality trends favorable but not as strong as the prior-year quarter.
- Institutional Markets: First-quarter sales included more than $1 billion in guaranteed investment contracts, and adjusted pretax operating income increased 15% year-over-year, supported by an 18% increase in reserves and a 13% rise in assets under management and administration. Costantini also noted the company issued $1 billion of GICs in January, including its first Canadian dollar-denominated GIC. Management said the pension risk transfer pipeline remains healthy, with greater activity expected in the second half of 2026.
Capital, liquidity, and dividends
Filiaggi said the company ended the quarter with more than $1.7 billion in holding company liquidity and received $925 million of dividends from its U.S. insurance companies. He said capital return to shareholders totaled $1.4 billion in the quarter, including completion of planned capital returns related to a variable annuity reinsurance transaction, totaling $1.8 billion. Excluding the VA reinsurance proceeds, Filiaggi said the company maintained its payout target with a payout ratio of 88%.
On insurance company dividend expectations, Filiaggi reiterated guidance for approximately $2.3 billion of insurance company distributions in 2026, including a final $300 million dividend from the Venerable transaction, implying about $2 billion of normalized insurance dividends. He said Corebridge “accelerate[d] a portion of our dividends in 1Q” and that dividends should be lower for the rest of the year, “more in the $450-$500 range.”
Portfolio positioning and industry headlines
Addressing questions about life insurers’ investment portfolios, Filiaggi emphasized Corebridge’s private debt exposure and related risk management. He said that within the company’s $284 billion statutory investment portfolio, $49 billion is private debt and 91% of that private debt is rated investment grade. He added that the company maintains processes to underwrite and monitor private assets whether originated internally or externally.
Filiaggi said middle market lending totaled $3.3 billion, or about 1% of the overall portfolio, and that the firm expects any losses in that allocation to be “yield adjustments and not credit events.” He also said software-sector exposure within that middle market book was less than $300 million and “all of it is currently performing.”
On business development companies, Filiaggi said Corebridge holds $1.7 billion of debt issued by BDCs and has no equity exposure. Longino told analysts Corebridge focuses on larger BDCs and views their portfolios as cash-generative and diversified. She said Corebridge’s BDC exposure is “all investment grade” and that the company continuously reviews asset coverage ratios, adding that its stress testing indicates “solid recovery through the unsecured BDC debt because of the structuring.”
Longino also addressed proposed RBC factor changes for CLOs, saying early indications are the impact would be minimal for Corebridge given the structure of its CLO portfolio.
Customer experience, digital initiatives, and branding plans
Costantini said Corebridge is investing to improve customer experience, including establishing a customer council comprised of cross-functional senior leaders. He highlighted operational efforts such as enhancing digital submissions, strengthening upfront suitability checks, improving real-time application status, and moving permanent life products onto a digital submission platform. He also cited a new wealth management digital experience launched the prior month and a new payroll platform aimed at making it easier for Group Retirement plan sponsors to integrate payroll data.
In the Q&A, Costantini said the company is accelerating AI deployment with a focus on “differentiated outcomes,” including enabling distribution and improving servicing. He gave an example of “digital agents” deployed to help Group Retirement servicing teams surface relevant plan and contract information. He added that the two companies will operate independently until close, but are comparing initiatives and identifying overlap to inform integration planning.
Costantini also said the combined company will move forward under the Equitable brand after the merger, citing Equitable’s “167-year-old brand,” while continuing to invest in the AllianceBernstein brand. He said the company does not expect business ramifications from the brand change and believes it will be “value add.”
About Corebridge Financial NYSE: CRBG
Corebridge Financial NYSE: CRBG is a publicly traded provider of retirement, life insurance and asset management solutions. Formed from the separation of American International Group’s life and retirement operations, Corebridge focuses on helping individuals, employers and institutions manage retirement income, protect against longevity and mortality risks, and invest long-term savings. The company operates under a unified brand that brings together insurance products and investment capabilities to deliver integrated financial solutions.
Corebridge’s product suite includes retirement income and annuity products, individual and group life insurance, asset management and investment advisory services, and employer-sponsored retirement plan offerings.
Read More
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
Before you consider Corebridge Financial, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Corebridge Financial wasn't on the list.
While Corebridge Financial currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
Looking for the next FAANG stock before everyone has heard about it? Click the link to see which stocks MarketBeat analysts think might become the next trillion dollar tech company.
Get This Free Report
