RGA Expands Partnership with Equitable, Boosts Income Potential

Significant partnership news: RGA's reinsurance deal with EQH is poised to enhance adjusted operating income, showing strong potential for investors. RGA expects $70 million contribution to operating income before taxes in 2025.

Date: 24-02-2025

AI Rating: 7

This report highlights a substantial agreement between Reinsurance Group of America (RGA) and Equitable Holdings (EQH). RGA is set to reinsure a large portion of Equitable's life insurance liabilities, which amounts to around $18 billion in general account reserves and $14 billion in separate account reserves. Such a significant transaction indicates a strong strategic partnership, which may positively influence both companies' stock prices.

RGA plans to allocate $1.5 billion in capital towards this reinsurance deal at closing, reflecting a strong commitment to the partnership. Furthermore, RGA projects an addition of approximately $70 million in adjusted operating income before taxes for 2025, signaling expected revenue growth. In 2026, this adjusted income is anticipated to increase considerably to between $160 million and $170 million. Both figures portray a positive outlook on profitability.

Overall, the financial implications of this partnership depicted in the report suggest improvements in profit margins for RGA, which should resonate positively with investors in the stock market.

Stocks: RGA EQH