F&G Annuities & Life, Inc. (NYSE:FG) Q4 2023 Earnings Call Transcript

Chris Blunt: Yes, 100%. So maybe start by saying what it’s not. We don’t fancy ourselves as rate traders or having deep insights about where interest rates are going, but I think our Chief Investment Officer had a very good insight, which was given where we put a lot of that floating rate exposure on. We had an ability to lock in some excess profitability and just take some variability off the table. So we had a pretty substantial position in floating rate assets. We’ve effectively now cut that by more than half by doing some hedging. I think you saw in the commentary we locked in approximately 190 basis points of outperformance. So I would say, it’s just consistent with how we think about the world, which is don’t be greedy, and when you have opportunities to take some risk off the table.

So look, at some point, nobody knows exactly when. We’re going to see rates march back down, and this was a choice on our part of let’s go for stability there. How much more you do going forward is kind of an open question of what’s the ultimate landing spot for your floating rate exposure. But I would expect in the near term, it’s going to come down. It’s going to continue to come down a bit more.

John Barnidge: Great. Thanks a lot for the opportunity.

Chris Blunt: Thank you.

Operator: Thank you, and this will conclude our question-and-answer session. Thank you for attending today’s presentation, and the conference call has concluded. You may now disconnect your lines.