EX-99.1 2 q42022bhffinancialsuppleme.htm EX-99.1

Exhibit 99.1

Brighthouse Financial, Inc.

Financial Supplement

Fourth Quarter 2022

Recast for Targeted Improvements to the Accounting for Long-Duration Contracts -- Unaudited

This financial supplement reflects the Company’s adoption, on January 1, 2023, of the provisions of U.S. GAAP Accounting Standards Update 2018-12, Targeted Improvements to the Accounting for Long-Duration Contracts ("LDTI"). This financial supplement replaces in its entirety the Company’s Q4 2022 Financial Supplement previously furnished on Form 8-K on February 9, 2023 and available on its website. This financial supplement is unaudited and is also being provided prior to the filing of the Company’s Form 10-Q for the quarter ended March 31, 2023, to aid investors and other users of our financial statements in understanding the impacts of the Company's adoption of LDTI. It is possible that the financial results included in the Company’s future filings with the U.S. Securities and Exchange Commission ("SEC") may differ, perhaps materially, from the information included herein. This financial supplement should be read in conjunction with Note 1 of the Notes to the Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2022, which has been filed with the SEC.

    

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Table of Contents			Financial Results
			1			Key Metrics
			2			GAAP Statements of Operations
			3			GAAP Balance Sheets
			Earnings and Select Metrics from Segments and Corporate & Other
			5			Statements of Adjusted Earnings by Segment and Corporate & Other
			6			Total Segments and Corporate & Other — Statements of Adjusted Earnings
			7			Annuities — Statements of Adjusted Earnings
			8			Annuities — Select Operating Metrics
			10			Life — Statements of Adjusted Earnings
			11			Life — Select Operating Metrics
			13			Run-off — Statements of Adjusted Earnings
			14			Run-off — Select Operating Metrics
			15			Corporate & Other — Statements of Adjusted Earnings
			Other Information
			17			Change in Market Risk Benefits and Net Derivative Gains (Losses)
			18			Notable Items
			19			Variable Annuity Separate Account Returns and Allocations
			20			Summary of Investments
			21			Statutory Statement of Operations Information
			22			Statutory Balance Sheet and Surplus Information
			Appendix
			A-1			Note Regarding Forward-Looking Statements
			A-2			Non-GAAP and Other Financial Disclosures
			A-6			Acronyms
			A-7			Reconciliation of Net Income (Loss) Available to Shareholders to Adjusted Earnings and Adjusted Earnings, Less Notable Items, and Reconciliation of Net Income (Loss) Available to Shareholders per Common Share to Adjusted Earnings per Common Share and Adjusted Earnings, Less Notable Items per Common Share
			A-8			Reconciliation of Return on Common Equity to Adjusted Return on Common Equity, Excluding AOCI
			A-9			Reconciliation of Total Revenues to Adjusted Revenues and Reconciliation of Total Expenses to Adjusted Expenses
			A-10			Investment Reconciliation Details

Note: See the Appendix for non-GAAP financial information, definitions and reconciliations. Financial information, unless otherwise noted, is rounded to millions. Some financial information, therefore, may not sum to the corresponding total.

As used in this financial supplement, “Brighthouse Financial,” “Brighthouse,” the “Company,” “we,” “our” and “us” refer to Brighthouse Financial, Inc.

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Financial Results

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Financial Supplement

1

Key Metrics (Unaudited, dollars in millions except per share amounts)

						As of or For the Three Months Ended																														As of or For the Year Ended
Financial Results and Metrics (1)						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022												December 31, 2022						December 31, 2021
Net income (loss) available to shareholders						$110						$388						$1,719						$1,558												$3,775						$1,554
Adjusted earnings						$545						$115						$144						$380												$1,184						$1,486
Adjusted earnings, less notable items (2)						$282						$74						$353						$411												$1,120						$1,805
Total corporate expenses (3)						$243						$217						$201						$208												$869						$890
Combined total adjusted capital						$8,052						$8,003						$8,188						$8,495												$8,052						$9,441
Combined risk-based capital ratio (4)						441%						450%-470%						470%-490%						450%-470%												441%						500%
Stockholders' Equity
Brighthouse Financial, Inc.’s stockholders’ equity						$5,533						$4,600						$7,180						$7,223												$5,533						$8,385
Less: Preferred stock, net						1,699						1,699						1,699						1,699												1,699						1,699
Brighthouse Financial, Inc.’s common stockholders’ equity, including AOCI						$3,834						$2,901						$5,481						$5,524												$3,834						$6,686
Less: AOCI						(6,106)						(7,015)						(4,176)						(2,541)												(6,106)						47
Brighthouse Financial, Inc.’s common stockholders’ equity, excluding AOCI						$9,940						$9,916						$9,657						$8,065												$9,940						$6,639
Return on Common Equity (1), (5)
Return on common equity						77.3%						93.7%						108.6%						98.8%												77.3%						21.8%
Return on common equity, excluding AOCI						42.7%						56.6%						79.4%						82.5%												42.7%						25.0%
Adjusted return on common equity, excluding AOCI						13.4%						9.9%						12.7%						20.1%												13.4%						24.0%
Earnings Per Common Share, Diluted (1)
Net income (loss) available to shareholders per common share						$1.59						$5.39						$22.91						$20.11												$51.30						$18.39
Adjusted earnings per common share						$7.81						$1.61						$1.91						$4.91												$16.09						$17.60
Adjusted earnings, less notable items per common share						$4.04						$1.03						$4.71						$5.30												$15.22						$21.37
Weighted average common shares outstanding						69,765,118						71,959,380						74,971,658						77,476,465												73,581,168						84,466,157
Book Value Per Common Share
Book value per common share (1)						$56.15						$41.41						$75.01						$72.88												$56.15						$85.86
Book value per common share, excluding AOCI (1)						$145.58						$141.53						$132.16						$106.40												$145.58						$85.26
Ending common shares outstanding						68,278,068						70,060,560						73,072,766						75,799,704												68,278,068						77,870,072
(1) Certain definitions have been updated due to the adoption of LDTI. See definitions for Non-GAAP and Other Financial Disclosures in the Appendix beginning on page A-2.
(2) See additional information regarding notable items on page 18.
(3) Includes functional department expenses, public company expenses, certain investment expenses, retirement funding and incentive compensation; and excludes establishment costs.
(4) The RBC ratio is reported as a preliminary range for all periods, except those ended December 31.
(5) Simplified averaging was applied to all periods presented for 2022 and December 31, 2021.

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Financial Supplement

2

GAAP Statements of Operations (Unaudited, in millions)

						For the Three Months Ended																								For the Year Ended
Revenues						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022												December 31, 2022						December 31, 2021
Premiums						$167						$162						$167						$166												$662						$707
Universal life and investment-type product policy fees						549						597						609						680												2,435						2,980
Net investment income						1,049						877						1,061						1,151												4,138						4,881
Other revenues						100						122						118						138												478						450
Revenues before NIGL and NDGL						1,865						1,758						1,955						2,135												7,713						9,018
Net investment gains (losses)						(69)						(45)						(66)						(68)												(248)						(59)
Net derivative gains (losses)						(1,923)						(592)						1,977						(54)												(592)						(3,983)
Total revenues						$(127)						$1,121						$3,866						$2,013												$6,873						$4,976
Expenses
Policyholder benefits and claims						$267						$534						$717						$675												$2,193						$2,746
Interest credited to policyholder account balances						401						405						284						248												1,338						1,269
Amortization of DAC and VOBA						155						159						158						157												629						637
Change in market risk benefits						(1,479)						(984)						(62)						(1,579)												(4,104)						(4,134)
Interest expense on debt						39						38						38						38												153						163
Other expenses						450						457						554						471												1,932						2,286
Total expenses						(167)						609						1,689						10												2,141						2,967
Income (loss) before provision for income tax						40						512						2,177						2,003												4,732						2,009
Provision for income tax expense (benefit)						(97)						97						432						416												848						361
Net income (loss)						137						415						1,745						1,587												3,884						1,648
Less: Net income (loss) attributable to noncontrolling interests						1						2						—						2												5						5
Net income (loss) attributable to Brighthouse Financial, Inc.						136						413						1,745						1,585												3,879						1,643
Less: Preferred stock dividends						26						25						26						27												104						89
Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders						$110						$388						$1,719						$1,558												$3,775						$1,554

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Financial Supplement

3

GAAP Balance Sheets (Unaudited, in millions)

						As of
ASSETS						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021
Investments:
Fixed maturity securities available-for-sale						$75,577						$75,271						$78,606						$82,496						$87,582
Equity securities						89						100						96						80						101
Mortgage loans						22,936						22,089						21,508						21,357						19,850
Policy loans						1,282						1,274						1,277						1,270						1,264
Limited partnerships and limited liability companies						4,775						4,607						4,683						4,587						4,271
Short-term investments						1,081						1,130						920						1,062						1,841
Other invested assets						2,852						4,033						3,345						2,568						3,316
Total investments						108,592						108,504						110,435						113,420						118,225
Cash and cash equivalents						4,115						4,793						5,071						4,101						4,474
Accrued investment income						885						909						852						754						724
Reinsurance recoverables						18,019						16,694						15,698						16,047						16,648
Premiums and other receivables						529						544						765						645						527
DAC and VOBA						5,084						5,142						5,196						5,239						5,288
Current income tax recoverable						38						18						18						—						—
Deferred income tax asset						1,736						1,942						1,272						1,271						1,001
Market risk benefit assets						483						400						375						384						449
Other assets						401						414						425						440						457
Separate account assets						84,965						81,836						88,843						104,441						114,464
Total assets						$224,847						$221,196						$228,950						$246,742						$262,257
LIABILITIES AND EQUITY
Liabilities
Future policy benefits						$31,497						$32,016						$33,492						$36,373						$39,990
Policyholder account balances						73,527						69,749						66,717						66,711						65,249
Market risk benefit liabilities						10,389						11,425						12,304						13,637						16,034
Other policy-related balances						4,098						4,051						3,944						4,098						4,075
Payables for collateral under securities loaned and other transactions						4,560						6,532						6,675						6,209						6,269
Long-term debt						3,156						3,156						3,157						3,157						3,157
Current income tax payable						—						—						—						61						62
Other liabilities						7,057						7,766						6,573						4,767						4,507
Separate account liabilities						84,965						81,836						88,843						104,441						114,464
Total liabilities						219,249						216,531						221,705						239,454						253,807
Equity
Preferred stock, at par value						—						—						—						—						—
Common stock, at par value						1						1						1						1						1
Additional paid-in capital						14,075						14,095						14,113						14,133						14,154
Retained earnings (deficit)						(395)						(532)						(945)						(2,689)						(4,274)
Treasury stock						(2,042)						(1,949)						(1,813)						(1,681)						(1,543)
Accumulated other comprehensive income (loss)						(6,106)						(7,015)						(4,176)						(2,541)						47
Total Brighthouse Financial, Inc.’s stockholders’ equity						5,533						4,600						7,180						7,223						8,385
Noncontrolling interests						65						65						65						65						65
Total equity						5,598						4,665						7,245						7,288						8,450
Total liabilities and equity						$224,847						$221,196						$228,950						$246,742						$262,257

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Earnings and

Select Metrics from

Segments and

Corporate & Other

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Financial Supplement

5

Statements of Adjusted Earnings by Segment and Corporate & Other (Unaudited, in millions)

						For the Year Ended December 31, 2022
Adjusted revenues						Annuities						Life						Run-off						Corporate & Other						Total
Premiums						$123						$537						$2						$—						$662
Universal life and investment-type product policy fees						1,708						219						508						—						2,435
Net investment income						2,261						442						1,166						340						4,209
Other revenues						434						15						29						—						478
Total adjusted revenues						$4,526						$1,213						$1,705						$340						$7,784
Adjusted expenses
Policyholder benefits and claims						$380						$800						$1,013						$—						$2,193
Interest credited to policyholder account balances						897						75						290						163						1,425
Amortization of DAC and VOBA						515						114						—						—						629
Interest expense on debt						—						—						—						153						153
Other operating costs						1,417						130						293						92						1,932
Total adjusted expenses						3,209						1,119						1,596						408						6,332
Adjusted earnings before provision for income tax						1,317						94						109						(68)						1,452
Provision for income tax expense (benefit)						247						16						22						(126)						159
Adjusted earnings after provision for income tax						1,070						78						87						58						1,293
Less: Net income (loss) attributable to noncontrolling interests						—						—						—						5						5
Less: Preferred stock dividends						—						—						—						104						104
Adjusted earnings						$1,070						$78						$87						$(51)						$1,184
						For the Year Ended December 31, 2021
Adjusted revenues						Annuities						Life						Run-off						Corporate & Other						Total
Premiums						$142						$562						$3						$—						$707
Universal life and investment-type product policy fees						2,155						341						484						—						2,980
Net investment income						2,217						698						1,910						77						4,902
Other revenues						389						32						29						—						450
Total adjusted revenues						$4,903						$1,633						$2,426						$77						$9,039
Adjusted expenses
Policyholder benefits and claims						$283						$786						$1,677						$—						$2,746
Interest credited to policyholder account balances						864						108						293						21						1,286
Amortization of DAC and VOBA						513						124						—						—						637
Interest expense on debt						—						—						—						163						163
Other operating costs						1,654						193						191						248						2,286
Total adjusted expenses						3,314						1,211						2,161						432						7,118
Adjusted earnings before provision for income tax						1,589						422						265						(355)						1,921
Provision for income tax expense (benefit)						303						88						59						(109)						341
Adjusted earnings after provision for income tax						1,286						334						206						(246)						1,580
Less: Net income (loss) attributable to noncontrolling interests						—						—						—						5						5
Less: Preferred stock dividends						—						—						—						89						89
Adjusted earnings						$1,286						$334						$206						$(340)						$1,486

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Financial Supplement

6

Total Segments and Corporate & Other — Statements of Adjusted Earnings (Unaudited, in millions)

						For the Three Months Ended																								For the Year Ended
Adjusted revenues						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022												December 31, 2022						December 31, 2021
Premiums						$167						$162						$167						$166												$662						$707
Universal life and investment-type product policy fees						549						597						609						680												2,435						2,980
Net investment income						1,082						900						1,070						1,157												4,209						4,902
Other revenues						100						122						118						138												478						450
Total adjusted revenues						$1,898						$1,781						$1,964						$2,141												$7,784						$9,039
Adjusted expenses
Policyholder benefits and claims						$267						$534						$717						$675												$2,193						$2,746
Interest credited to policyholder account balances						398						425						316						286												1,425						1,286
Amortization of DAC and VOBA						155						159						158						157												629						637
Interest expense on debt						39						38						38						38												153						163
Other operating costs						450						457						554						471												1,932						2,286
Total adjusted expenses						1,309						1,613						1,783						1,627												6,332						7,118
Adjusted earnings before provision for income tax						589						168						181						514												1,452						1,921
Provision for income tax expense (benefit)						17						26						11						105												159						341
Adjusted earnings after provision for income tax						572						142						170						409												1,293						1,580
Less: Net income (loss) attributable to noncontrolling interests						1						2						—						2												5						5
Less: Preferred stock dividends						26						25						26						27												104						89
Adjusted earnings						$545						$115						$144						$380												$1,184						$1,486

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Financial Supplement

7

Annuities — Statements of Adjusted Earnings (Unaudited, in millions)

						For the Three Months Ended																								For the Year Ended
Adjusted revenues						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022												December 31, 2022						December 31, 2021
Premiums						$39						$30						$29						$25												$123						$142
Universal life and investment-type product policy fees						367						401						442						498												1,708						2,155
Net investment income						613						547						546						555												2,261						2,217
Other revenues						85						113						112						124												434						389
Total adjusted revenues						$1,104						$1,091						$1,129						$1,202												$4,526						$4,903
Adjusted expenses
Policyholder benefits and claims						$144						$86						$75						$75												$380						$283
Interest credited to policyholder account balances						232						283						192						190												897						864
Amortization of DAC and VOBA						129						130						129						127												515						513
Interest expense on debt						—						—						—						—												—						—
Other operating costs						360						346						339						372												1,417						1,654
Total adjusted expenses						865						845						735						764												3,209						3,314
Adjusted earnings before provision for income tax						239						246						394						438												1,317						1,589
Provision for income tax expense (benefit)						45						44						74						84												247						303
Adjusted earnings						$194						$202						$320						$354												$1,070						$1,286

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Financial Supplement

8

Annuities — Select Operating Metrics (Unaudited, in millions)

						For the Three Months Ended
VARIABLE AND SHIELD LEVEL ANNUITIES ACCOUNT VALUE (1)						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021
Account value, beginning of period						$105,392						$112,139						$128,397						$136,881						$133,155
Premiums and deposits (2)						1,595						1,702						2,035						1,876						2,111
Withdrawals, surrenders and contract benefits						(2,717)						(2,504)						(2,500)						(2,758)						(3,231)
Net flows (3)						(1,122)						(802)						(465)						(882)						(1,120)
Investment performance (4)						7,121						(5,363)						(15,219)						(7,026)						5,496
Policy charges and other						(540)						(582)						(574)						(576)						(650)
Account value, end of period						$110,851						$105,392						$112,139						$128,397						$136,881
FIXED ANNUITIES ACCOUNT VALUE (5)
Account value, beginning of period						$17,938						$16,028						$15,671						$15,603						$15,536
Premiums and deposits (2)						1,656						2,055						503						241						316
Withdrawals, surrenders and contract benefits						(587)						(283)						(237)						(266)						(331)
Net flows (3)						1,069						1,772						266						(25)						(15)
Interest credited						(228)						109						96						89						92
Other						(27)						29						(5)						4						(10)
Account value, end of period						$18,752						$17,938						$16,028						$15,671						$15,603
INCOME ANNUITIES (1)
Income annuity insurance liabilities						$4,569						$4,576						$4,587						$4,613						$4,644
(1) Includes general account and separate account.
(2) Includes premiums and deposits directed to the general account investment option of variable products.
(3) Deposits and withdrawals include policy exchanges.
(4) Includes the interest credited on the general account option of variable products.
(5) Includes fixed index annuities.

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Financial Supplement

9

Annuities — Select Operating Metrics (Cont.) (Unaudited, in millions)

						For the Three Months Ended																														For the Year Ended
VARIABLE AND SHIELD LEVEL ANNUITY SALES						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021						December 31, 2022						December 31, 2021
Shield Level Annuities (1)						$1,389						$1,436						$1,629						$1,394						$1,551						$5,848						$6,201
GMWB						101						149						268						334						393						852						1,548
GMDB only						55						69						75						87						84						286						376
GMIB						9						10						13						17						18						49						76
Total variable and Shield Level annuity sales						$1,554						$1,664						$1,985						$1,832						$2,046						$7,035						$8,201
FIXED AND INCOME ANNUITY SALES
Fixed index annuities (2)						$161						$213						$206						$196						$292						$776						$845
Fixed deferred annuities						1,493						1,841						293						41						19						3,668						102
Single premium immediate annuities						3						2						2						1						1						8						2
Other fixed and income annuities						—						1						—						—						1						1						2
Total fixed and income annuity sales						$1,657						$2,057						$501						$238						$313						$4,453						$951
(1) Shield Level Annuities refers to our suite of structured annuities consisting of products marketed under various names.
(2) Represents 100% of gross sales on directly written business and the proportion of assumed gross sales under reinsurance agreements.

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Financial Supplement

10

Life — Statements of Adjusted Earnings (Unaudited, in millions)

						For the Three Months Ended																								For the Year Ended
Adjusted revenues						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022												December 31, 2022						December 31, 2021
Premiums						$128						$130						$138						$141												$537						$562
Universal life and investment-type product policy fees						66						61						36						56												219						341
Net investment income						90						77						115						160												442						698
Other revenues						7						2						—						6												15						32
Total adjusted revenues						$291						$270						$289						$363												$1,213						$1,633
Adjusted expenses
Policyholder benefits and claims						$168						$223						$192						$217												$800						$786
Interest credited to policyholder account balances						22						23						26						4												75						108
Amortization of DAC and VOBA						26						29						29						30												114						124
Interest expense on debt						—						—						—						—												—						—
Other operating costs						56						39						6						29												130						193
Total adjusted expenses						272						314						253						280												1,119						1,211
Adjusted earnings before provision for income tax						19						(44)						36						83												94						422
Provision for income tax expense (benefit)						2						(10)						7						17												16						88
Adjusted earnings						$17						$(34)						$29						$66												$78						$334

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Financial Supplement

11

Life — Select Operating Metrics (Unaudited, in millions)

						For the Three Months Ended
LIFE ACCOUNT VALUE: GENERAL ACCOUNT						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021
Universal and variable universal life account value, beginning of period						$2,663						$2,678						$2,671						$2,694						$2,680
Premiums and deposits (1)						54						54						54						56						86
Withdrawals, surrenders and contract benefits						(33)						(44)						(34)						(42)						(33)
Net flows						21						10						20						14						53
Net transfers from (to) separate account						7						9						17						15						5
Interest credited						24						24						24						5						28
Policy charges and other						(57)						(58)						(54)						(57)						(72)
Universal and variable universal life account value, end of period						$2,658						$2,663						$2,678						$2,671						$2,694
LIFE ACCOUNT VALUE: SEPARATE ACCOUNT
Variable universal life account value, beginning of period						$4,912						$5,251						$6,262						$6,861						$6,598
Premiums and deposits						44						44						43						45						47
Withdrawals, surrenders and contract benefits						(43)						(64)						(52)						(68)						(81)
Net flows						1						(20)						(9)						(23)						(34)
Investment performance						364						(263)						(929)						(513)						357
Net transfers from (to) general account						(10)						(9)						(16)						(15)						(5)
Policy charges and other						(52)						(47)						(57)						(48)						(55)
Variable universal life account value, end of period						$5,215						$4,912						$5,251						$6,262						$6,861
(1) Includes premiums and deposits directed to the general account investment option of variable products.

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Financial Supplement

12

Life — Select Operating Metrics (Cont.) (Unaudited, in millions)

For the Three Months Ended

For the Year Ended

LIFE SALES

December 31, 2022

September 30, 2022

June 30, 2022

March 31, 2022

December 31, 2021

December 31, 2022

December 31, 2021

Total life sales

$22

$19

$19

$20

$35

$80

$111

						As of
LIFE INSURANCE IN-FORCE						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021
Whole Life
Life Insurance in-force, before reinsurance						$18,264						$18,422						$18,490						$18,645						$18,819
Life Insurance in-force, net of reinsurance						$3,069						$3,156						$3,113						$3,153						$3,196
Term Life
Life Insurance in-force, before reinsurance						$360,611						$364,251						$368,082						$372,019						$376,022
Life Insurance in-force, net of reinsurance						$288,522						$290,746						$292,839						$295,051						$297,053
Universal and Variable Universal Life
Life Insurance in-force, before reinsurance						$46,000						$46,336						$46,876						$48,063						$49,063
Life Insurance in-force, net of reinsurance						$34,463						$34,597						$34,981						$36,118						$37,016

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Financial Supplement

13

Run-off — Statements of Adjusted Earnings (Unaudited, in millions)

						For the Three Months Ended																								For the Year Ended
Adjusted revenues						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022												December 31, 2022						December 31, 2021
Premiums						$—						$2						$—						$—												$2						$3
Universal life and investment-type product policy fees						116						135						131						126												508						484
Net investment income						247						168						350						401												1,166						1,910
Other revenues						8						7						6						8												29						29
Total adjusted revenues						$371						$312						$487						$535												$1,705						$2,426
Adjusted expenses
Policyholder benefits and claims						$(44)						$225						$450						$382												$1,013						$1,677
Interest credited to policyholder account balances						72						69						71						78												290						293
Amortization of DAC and VOBA						—						—						—						—												—						—
Interest expense on debt						—						—						—						—												—						—
Other operating costs						45						38						166						44												293						191
Total adjusted expenses						73						332						687						504												1,596						2,161
Adjusted earnings before provision for income tax						298						(20)						(200)						31												109						265
Provision for income tax expense (benefit)						62						(4)						(43)						7												22						59
Adjusted earnings						$236						$(16)						$(157)						$24												$87						$206

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Financial Supplement

14

Run-off — Select Operating Metrics (Unaudited, in millions)

						For the Three Months Ended
UNIVERSAL LIFE WITH SECONDARY GUARANTEES ACCOUNT VALUE						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021
Account value, beginning of period						$5,380						$5,454						$5,512						$5,569						$5,629
Premiums and deposits (1)						167						173						180						177						170
Withdrawals, surrenders and contract benefits						(32)						(32)						(21)						(32)						(26)
Net flows						135						141						159						145						144
Interest credited						46						46						45						62						50
Policy charges and other						(254)						(261)						(262)						(264)						(254)
Account value, end of period						$5,307						$5,380						$5,454						$5,512						$5,569

						As of
LIFE INSURANCE IN-FORCE						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021
Universal Life with Secondary Guarantees
Life Insurance in-force, before reinsurance						$72,276						$72,847						$73,393						$73,813						$74,535
Life Insurance in-force, net of reinsurance						$35,980						$36,308						$36,611						$36,887						$37,206
(1) Includes premiums and deposits directed to the general account investment option of variable products.

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Financial Supplement

15

Corporate & Other — Statements of Adjusted Earnings (Unaudited, in millions)

						For the Three Months Ended																								For the Year Ended
Adjusted revenues						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022												December 31, 2022						December 31, 2021
Premiums						$—						$—						$—						$—												$—						$—
Universal life and investment-type product policy fees						—						—						—						—												—						—
Net investment income						132						108						59						41												340						77
Other revenues						—						—						—						—												—						—
Total adjusted revenues						$132						$108						$59						$41												$340						$77
Adjusted expenses
Policyholder benefits and claims						$(1)						$—						$—						$1												$—						$—
Interest credited to policyholder account balances						72						50						27						14												163						21
Amortization of DAC and VOBA						—						—						—						—												—						—
Interest expense on debt						39						38						38						38												153						163
Other operating costs						(11)						34						43						26												92						248
Total adjusted expenses						99						122						108						79												408						432
Adjusted earnings before provision for income tax						33						(14)						(49)						(38)												(68)						(355)
Provision for income tax expense (benefit)						(92)						(4)						(27)						(3)												(126)						(109)
Adjusted earnings after provision for income tax						125						(10)						(22)						(35)												58						(246)
Less: Net income (loss) attributable to noncontrolling interests						1						2						—						2												5						5
Less: Preferred stock dividends						26						25						26						27												104						89
Adjusted earnings						$98						$(37)						$(48)						$(64)												$(51)						$(340)

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Other Information

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Financial Supplement

17

Change in Market Risk Benefits and Net Derivative Gains (Losses) (Unaudited, in millions)

						For the Three Months Ended																								For the Year Ended
CHANGE IN MARKET RISK BENEFITS						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022												December 31, 2022						December 31, 2021
Market risk benefits mark-to-market						$1,290						$786						$(122)						$1,428												$3,382						$3,322
Market risk benefits fees, net of claims						195						211						189						178												773						868
Ceded reinsurance						(6)						(13)						(5)						(27)												(51)						(56)
Total change in market risk benefits						$1,479						$984						$62						$1,579												$4,104						$4,134

						For the Three Months Ended																								For the Year Ended
NET DERIVATIVE GAINS (LOSSES)						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022												December 31, 2022						December 31, 2021
Net derivative gains (losses):
Variable annuity hedges						$(274)						$(772)						$(188)						$(317)												$(1,551)						$(1,130)
Shield embedded derivatives						(1,323)						549						2,752						701												2,679						(2,857)
ULSG hedges						(192)						(483)						(659)						(540)												(1,874)						(223)
Other hedges and embedded derivatives						(167)						91						63						96												83						206
Subtotal						(1,956)						(615)						1,968						(60)												(663)						(4,004)
Investment hedge adjustments						33						23						9						6												71						21
Total net derivative gains (losses)						$(1,923)						$(592)						$1,977						$(54)												$(592)						$(3,983)

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Financial Supplement

18

Notable Items (Unaudited, in millions)

						For the Three Months Ended																								For the Year Ended
NOTABLE ITEMS IMPACTING ADJUSTED EARNINGS						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022												December 31, 2022						December 31, 2021
Actuarial items and other insurance adjustments						$(227)						$(57)						$200						$19												$(65)						$182
Establishment costs						15						16						9						12												52						78
Debt repayment costs						—						—						—						—												—						59
Prior year tax matters						(51)						—						—						—												(51)						—
Total notable items (1)						$(263)						$(41)						$209						$31												$(64)						$319
NOTABLE ITEMS BY SEGMENT AND CORPORATE & OTHER
Annuities						$44						$55						$—						$—												$99						$61
Life						—						16						—						19												35						—
Run-off						(271)						(128)						200						—												(199)						121
Corporate & Other						(36)						16						9						12												1						137
Total notable items (1)						$(263)						$(41)						$209						$31												$(64)						$319
(1) See definitions for Non-GAAP and Other Financial Disclosures in the Appendix beginning on page A-2.

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Financial Supplement

19

Variable Annuity Separate Account Returns and Allocations (Unaudited)

						For the Three Months Ended
VARIABLE ANNUITY SEPARATE ACCOUNT RETURNS						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021
Total Quarterly VA separate account gross returns						6.82%						(5.41)%						(12.58)%						(6.36)%						4.60%
TOTAL VARIABLE ANNUITY SEPARATE ACCOUNT ALLOCATIONS
Percent allocated to equity funds						27.40%						27.97%						27.60%						29.43%						29.62%
Percent allocated to bond funds/other funds						8.82%						9.48%						9.29%						8.72%						8.57%
Percent allocated to target volatility funds						20.28%						20.56%						21.01%						19.66%						19.87%
Percent allocated to balanced funds						43.50%						41.99%						42.10%						42.19%						41.94%

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Financial Supplement

20

Summary of Investments (Unaudited, dollars in millions)

						December 31, 2022												December 31, 2021
						Amount						% of Total						Amount						% of Total
Fixed maturity securities:
U.S. corporate securities						$32,607						28.93%						$39,081						31.85%
Foreign corporate securities						10,576						9.38%						11,706						9.54%
U.S. government and agency securities						8,016						7.11%						9,307						7.59%
Residential mortgage-backed securities						7,528						6.68%						9,259						7.55%
Commercial mortgage-backed securities						6,611						5.87%						7,282						5.93%
Asset-backed securities						5,359						4.75%						4,280						3.49%
State and political subdivision securities						3,799						3.37%						4,835						3.94%
Foreign government securities						1,081						0.96%						1,832						1.49%
Total fixed maturity securities						75,577						67.05%						87,582						71.38%
Equity securities						89						0.08%						101						0.08%
Mortgage loans:
Commercial mortgage loans						13,574						12.04%						12,187						9.93%
Residential mortgage loans						5,116						4.54%						3,623						2.96%
Agricultural mortgage loans						4,365						3.87%						4,163						3.39%
Allowance for credit losses						(119)						(0.10)%						(123)						(0.10)%
Total mortgage loans, net						22,936						20.35%						19,850						16.18%
Policy loans						1,282						1.14%						1,264						1.03%
Limited partnerships and limited liability companies						4,775						4.24%						4,271						3.48%
Cash, cash equivalents and short-term investments						5,196						4.61%						6,315						5.15%
Other invested assets:
Derivatives:
Interest rate						304						0.27%						1,094						0.89%
Equity market						1,217						1.08%						1,665						1.36%
Foreign currency exchange rate						745						0.66%						328						0.27%
Credit						18						0.02%						39						0.03%
Total derivatives						2,284						2.03%						3,126						2.55%
ICOLI						250						0.22%						—						0.00%
FHLB common stock						201						0.18%						70						0.05%
Other						117						0.10%						120						0.10%
Total other invested assets						2,852						2.53%						3,316						2.70%
Total investments and cash and cash equivalents						$112,707						100.00%						$122,699						100.00%

For the Three Months Ended

December 31, 2022

September 30, 2022

June 30, 2022

March 31, 2022

December 31, 2021

Net investment income yield (1)

3.79%

3.20%

3.92%

4.36%

4.66%

(1) See definitions for Non-GAAP and Other Financial Disclosures in the Appendix beginning on page A-2.

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Financial Supplement

21

Statutory Statement of Operations Information (Unaudited, in millions except Normalized Statutory Earnings (Loss))

						For the Three Months Ended																														For the Year Ended
COMBINED REVENUES AND EXPENSES (1)						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021						December 31, 2022						December 31, 2021
Total revenues (Line 9)						$2,120						$5,089						$7,081						$4,165						$3,324						$18,455						$14,353
Total benefits and expenses before dividends to policyholders (Line 28)						$1,542						$4,165						$6,920						$4,619						$3,537						$17,246						$13,236
COMBINED NET INCOME (LOSS) (1)
Gain (loss) from operations net of taxes and dividends to policyholders (Line 33)						$673						$869						$154						$(424)						$(196)						$1,272						$1,154
Net realized capital gains (losses), net of taxes and certain transfers to interest maintenance reserve (Line 34)						(394)						(76)						460						42						(87)						32						(1,322)
Net income (loss) (Line 35)						$279						$793						$614						$(382)						$(283)						$1,304						$(168)
																																				For the Year Ended
NORMALIZED STATUTORY EARNINGS (LOSS) (2), (3)																																				December 31, 2022						December 31, 2021
																																				(In billions)
Statutory net gain (loss) from operations, pre-tax																																				$1.0						$—
Add: net realized capital gains (losses)																																				0.4						—
Add: change in total asset requirement at CTE98, net of the change in VA reserves																																				0.7						—
Add: unrealized gains (losses) on VA & Shield hedging program and other equity risk management strategies																																				(1.6)						—
Add: impact of actuarial items and other insurance adjustments																																				0.4						—
Add: other adjustments, net																																				0.1						—
Normalized statutory earnings (loss)																																				$1.0						$—
(1) Combined statutory results are for Brighthouse Life Insurance Company, Brighthouse Life Insurance Company of NY and New England Life Insurance Company.
(2) See definitions for Non-GAAP and Other Financial Disclosures in the Appendix beginning on page A-2.
(3) Normalized statutory earnings (loss), presented in billions, is for Brighthouse Life Insurance Company and New England Life Insurance Company.

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Financial Supplement

22

Statutory Balance Sheet and Surplus Information (Unaudited, in millions)

						As of
COMBINED ASSETS, LIABILITIES, AND CAPITAL AND SURPLUS (1)						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021
Total assets (Line 28)						$188,585						$187,747						$192,672						$203,117						$210,819
Total liabilities (Line 28)						$182,044						$181,264						$186,053						$196,196						$202,918
Total capital and surplus (Line 38)						$6,541						$6,483						$6,619						$6,921						$7,901
COMBINED TAC AND RBC RATIO (1), (2)
Combined total adjusted capital						$8,052						$8,003						$8,188						$8,495						$9,441
Combined risk-based capital ratio (3)						441%						450%-470%						470%-490%						450%-470%						500%
COMBINED ORDINARY DIVIDEND CAPACITY (1)
Dividends paid to Holding Company						$38						$—						$—						$—						$344
Remaining ordinary dividend capacity (4)						$1,474						$1,512						$1,512						$1,512						$244
(1) Combined statutory results are for Brighthouse Life Insurance Company and New England Life Insurance Company.
(2) See definitions for Non-GAAP and Other Financial Disclosures in the Appendix beginning on page A-2.
(3) The RBC ratio is reported as a preliminary range for all periods, except those ended December 31.
(4) Reflects remaining dividend amounts that may be paid at one or more points in time during the respective calendar year without prior regulatory approval.

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Appendix

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Financial Supplement

A-1

Note Regarding Forward-Looking Statements

This financial supplement and other oral or written statements that we make from time to time may contain information that includes or is based upon forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve substantial risks and uncertainties. We have tried, wherever possible, to identify such statements using words such as “anticipate,” “estimate,” “expect,” “project,” “may,” “will,” “could,” “intend,” “goal,” “target,” “guidance,” “forecast,” “preliminary,” “objective,” “continue,” “aim,” “plan,” “believe” and other words and terms of similar meaning, or that are tied to future periods, in connection with a discussion of future operating or financial performance. In particular, these include, without limitation, statements relating to future actions, prospective services or products, financial projections, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, as well as trends in operating and financial results.

Any or all forward-looking statements may turn out to be wrong. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining the actual future results of Brighthouse Financial. These statements are based on current expectations and the current economic environment and involve a number of risks and uncertainties that are difficult to predict. These statements are not guarantees of future performance. Actual results could differ materially from those expressed or implied in the forward-looking statements due to a variety of known and unknown risks, uncertainties and other factors. Although it is not possible to identify all of these risks and factors, they include, among others: differences between actual experience and actuarial assumptions and the effectiveness of our actuarial models; higher risk management costs and exposure to increased market risk due to guarantees within certain of our products; the effectiveness of our variable annuity exposure risk management strategy and the impact of such strategy on volatility in our profitability measures and negative effects on our statutory capital; material differences between actual outcomes and the sensitivities calculated under certain scenarios that we may utilize in connection with our variable annuity risk management strategies; the impact of interest rates on our future ULSG policyholder obligations and net income volatility; the potential material adverse effect of changes in accounting standards, practices or policies applicable to us, including changes in the accounting for long-duration contracts; loss of business and other negative impacts resulting from a downgrade or a potential downgrade in our financial strength or credit ratings; the availability of reinsurance and the ability of the counterparties to our reinsurance or indemnification arrangements to perform their obligations thereunder; heightened competition, including with respect to service, product features, scale, price, actual or perceived financial strength, claims-paying ratings, credit ratings, e-business capabilities and name recognition; our ability to market and distribute our products through distribution channels; any failure of third parties to provide services we need, any failure of the practices and procedures of such third parties and any inability to obtain information or assistance we need from third parties; the ability of our subsidiaries to pay dividends to us, and our ability to pay dividends to our shareholders and repurchase our common stock; the risks associated with climate change; the adverse impact of public health crises, extreme mortality events or similar occurrences on our business and the economy in general; the impact of adverse capital and credit market conditions, including with respect to our ability to meet liquidity needs and access capital; the impact of economic conditions in the capital markets and the U.S. and global economy, as well as geopolitical events, military actions or catastrophic events, on our profitability measures as well as our investment portfolio, including on realized and unrealized losses and impairments, net investment spread and net investment income; the financial risks that our investment portfolio is subject to, including credit risk, interest rate risk, inflation risk, market valuation risk, liquidity risk, real estate risk, derivatives risk, and other factors outside our control; the impact of changes in regulation and in supervisory and enforcement policies or interpretations thereof on our insurance business or other operations; the potential material negative tax impact of potential future tax legislation that could make some of our products less attractive to consumers or increase our tax liability; the effectiveness of our policies, procedures and processes in managing risk; the loss or disclosure of confidential information, damage to our reputation and impairment of our ability to conduct business effectively as a result of any failure in cyber- or other information security systems; whether all or any portion of the tax consequences of our separation from MetLife, Inc. are not as expected, leading to material additional taxes or material adverse consequences to tax attributes that impact us; and other factors described from time to time in documents that we file with the SEC.

For the reasons described above, we caution you against relying on any forward-looking statements, which should also be read in conjunction with the other cautionary statements included and the risks, uncertainties and other factors identified in our Annual Report on Form 10-K for the year ended December 31, 2022, particularly in the sections entitled “Risk Factors” and “Quantitative and Qualitative Disclosures About Market Risk,” as well as in our other subsequent filings with the SEC. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by law.

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Financial Supplement

A-2

Non-GAAP and Other Financial Disclosures

Our definitions of non-GAAP and other financial measures may differ from those used by other companies.

Non-GAAP Financial Disclosures

We present certain measures of our performance that are not calculated in accordance with GAAP. We believe that these non-GAAP financial measures enhance the understanding of our performance by the investor community by highlighting the results of operations and the underlying profitability drivers of our business.

The following non-GAAP financial measures should not be viewed as substitutes for the most directly comparable financial measures calculated in accordance with GAAP:

Non-GAAP financial measures:

Most directly comparable GAAP financial measures:

(i)

adjusted earnings

(i)

net income (loss) available to shareholders (1)

(ii)

adjusted earnings, less notable items

(ii)

net income (loss) available to shareholders (1)

(iii)

adjusted revenues

(iii)

revenues

(iv)

adjusted expenses

(iv)

expenses

(v)

adjusted earnings per common share

(v)

earnings per common share, diluted (1)

(vi)

adjusted earnings per common share, less notable items

(vi)

earnings per common share, diluted (1)

(vii)

adjusted return on common equity

(vii)

return on common equity (2)

(viii)

adjusted return on common equity, less notable items

(viii)

return on common equity (2)

(ix)

adjusted net investment income

(ix)

net investment income

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(1) Brighthouse uses net income (loss) available to shareholders to refer to net income (loss) available to Brighthouse Financial, Inc.’s common shareholders, and earnings per common share, diluted to refer to net income (loss) available to shareholders per common share.

(2) Brighthouse uses return on common equity to refer to return on Brighthouse Financial, Inc.’s common stockholders' equity.

Reconciliations to the most directly comparable historical GAAP measures are included for those measures which are presented herein. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are not accessible on a forward-looking basis because we believe it is not possible without unreasonable efforts to provide other than a range of net investment gains and losses and net derivative gains and losses, which can fluctuate significantly within or outside the range and from period to period and may have a material impact on net income (loss) available to shareholders.

Adjusted Earnings, Adjusted Revenues and Adjusted Expenses

Adjusted earnings is a financial measure used by management to evaluate performance and facilitate comparisons to industry results. This financial measure, which may be positive or negative, focuses on our primary businesses by excluding the impact of market volatility, which could distort trends.

Adjusted earnings reflects adjusted revenues less (i) adjusted expenses, (ii) provision for income tax expense (benefit), (iii) net income (loss) attributable to noncontrolling interests and (iv) preferred stock dividends. Provided below are the adjustments to GAAP revenues and GAAP expenses used to calculate adjusted revenues and adjusted expenses, respectively.

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Financial Supplement

A-3

Non-GAAP and Other Financial Disclosures (Cont.)

The following are significant items excluded from total revenues in calculating the adjusted revenues component of adjusted earnings:

•Net investment gains (losses); and

•Net derivative gains (losses), excluding earned income and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments, but do not qualify for hedge accounting treatment (“Investment Hedge Adjustments”).

The following are significant items excluded from total expenses in calculating the adjusted expenses component of adjusted earnings:

•Change in market risk benefits; and

•Amounts associated with periodic crediting rate adjustments based on the total return of a contractually referenced pool of assets (“Market Value Adjustments”).

The tax impact of the adjustments discussed above is calculated net of the statutory tax rate, which could differ from our effective tax rate.

Consistent with GAAP guidance for segment reporting, adjusted earnings is also our GAAP measure of segment performance.

Adjusted Earnings per Common Share and Adjusted Return on Common Equity

Adjusted earnings per common share and adjusted return on common equity are measures used by management to evaluate the execution of our business strategy and align such strategy with our shareholders’ interests.

Adjusted earnings per common share is defined as adjusted earnings for the period divided by the weighted average number of fully diluted shares of common stock outstanding for the period. The weighted average common shares outstanding used to calculate adjusted earnings per share will differ from such shares used to calculate diluted net income (loss) available to shareholders per common share when the inclusion of dilutive shares has an anti-dilutive effect for one calculation but not for the other.

Adjusted return on common equity is defined as total annual adjusted earnings on a four quarter trailing basis, divided by the simple average of the most recent five quarters of total Brighthouse Financial, Inc.’s common stockholders’ equity, excluding AOCI.

Adjusted Net Investment Income

We present adjusted net investment income to measure our performance for management purposes, and we believe it enhances the understanding of our investment portfolio results. Adjusted net investment income represents GAAP net investment income plus Investment Hedge Adjustments.

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Financial Supplement

A-4

Non-GAAP and Other Financial Disclosures (Cont.)

Other Financial Disclosures

Corporate Expenses

Corporate expenses includes functional department expenses, public company expenses, certain investment expenses, retirement funding and incentive compensation; and excludes establishment costs.

Notable items

Certain of the non-GAAP measures described above may be presented further adjusted to exclude notable items. Notable items reflect the unfavorable (favorable) after-tax impact on our results of certain unanticipated items and events, as well as certain items and events that were anticipated, such as establishment costs. The presentation of notable items and non-GAAP measures, less notable items is intended to help investors better understand our results and to evaluate and forecast those results.

Book Value per Common Share and Book Value per Common Share, excluding AOCI

Brighthouse uses the term “book value” to refer to “Brighthouse Financial, Inc.’s common stockholders’ equity, including AOCI.” Book value per common share is defined as ending Brighthouse Financial, Inc.’s common stockholders’ equity, including AOCI, divided by ending common shares outstanding. Book value per common share, excluding AOCI, is defined as ending Brighthouse Financial, Inc.’s common stockholders’ equity, excluding AOCI, divided by ending common shares outstanding.

CTE98

CTE98 is defined as the amount of assets required to satisfy contract holder obligations across market environments in the average of the worst two percent of a set of capital market scenarios over the life of the contracts.

Holding Company Liquid Assets

Holding company liquid assets include liquid assets in Brighthouse Financial, Inc., Brighthouse Holdings, LLC, and Brighthouse Services, LLC. Liquid assets are comprised of cash and cash equivalents, short-term investments and publicly-traded securities, excluding assets that are pledged or otherwise committed. Assets pledged or otherwise committed include assets held in trust.

Total Adjusted Capital

Total adjusted capital primarily consists of statutory capital and surplus, as well as the statutory asset valuation reserve. When referred to as “combined,” represents that of our insurance subsidiaries as a whole.

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Financial Supplement

A-5

Non-GAAP and Other Financial Disclosures (Cont.)

Other Financial Disclosures (cont.)

Sales

Life insurance sales consist of 100 percent of annualized new premium for term life, first-year paid premium for whole life, universal life, and variable universal life, and total paid premium for indexed universal life. We exclude company-sponsored internal exchanges, corporate-owned life insurance, bank-owned life insurance, and private placement variable universal life.

Annuity sales consist of 100 percent of direct statutory premiums, except for fixed index annuity sales, which represents 100 percent of gross sales on directly written business and the proportion of assumed gross sales under reinsurance agreements. Annuity sales exclude certain internal exchanges. These sales statistics do not correspond to revenues under GAAP, but are used as relevant measures of business activity.

Net Investment Income Yield

Similar to adjusted net investment income, we present net investment income yields as a performance measure we believe enhances the understanding of our investment portfolio results. Net investment income yields are calculated on adjusted net investment income as a percentage of average quarterly asset carrying values. Asset carrying values exclude unrealized gains (losses), collateral received in connection with our securities lending program, freestanding derivative assets and collateral received from derivative counterparties. Investment fee and expense yields are calculated as a percentage of average quarterly asset estimated fair values. Asset estimated fair values exclude collateral received in connection with our securities lending program, freestanding derivative assets and collateral received from derivative counterparties.

Normalized Statutory Earnings (Loss)

Normalized statutory earnings (loss) is used by management to measure our insurance companies’ ability to pay future distributions and is reflective of whether our hedging program functions as intended. Normalized statutory earnings (loss) is calculated as statutory pre-tax net gain (loss) from operations adjusted for the favorable or unfavorable impacts of (i) net realized capital gains (losses), (ii) the change in total asset requirement at CTE98, net of the change in our variable annuity reserves, and (iii) unrealized gains (losses) associated with our variable annuities and Shield hedging programs and other equity risk management strategies. Normalized statutory earnings (loss) may be further adjusted for certain unanticipated items that impact our results in order to help management and investors better understand, evaluate and forecast those results.

Risk-Based Capital Ratio

The risk-based capital ratio is a method of measuring an insurance company’s capital, taking into consideration its relative size and risk profile, in order to ensure compliance with minimum regulatory capital requirements set by the National Association of Insurance Commissioners. When referred to as “combined,” represents that of our insurance subsidiaries as a whole. The reporting of our combined risk-based capital ratio is not intended for the purpose of ranking any insurance company or for use in connection with any marketing, advertising or promotional activities.

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Financial Supplement

A-6

Acronyms

AOCI			Accumulated other comprehensive income (loss)
CTE			Conditional tail expectations
DAC			Deferred policy acquisition costs
FHLB			Federal Home Loan Bank
GAAP			Accounting principles generally accepted in the United States of America
GMDB			Guaranteed minimum death benefits
GMIB			Guaranteed minimum income benefits
GMWB			Guaranteed minimum withdrawal benefits
ICOLI			Insurance company-owned life insurance
LDTI			Targeted Improvements to the Accounting for Long-Duration Contracts
NDGL			Net derivative gains (losses)
NIGL			Net investment gains (losses)
RBC			Risk-based capital
TAC			Total adjusted capital
ULSG			Universal life insurance with secondary guarantees
VA			Variable annuity
VOBA			Value of business acquired

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Financial Supplement

A-7

Reconciliation of Net Income (Loss) Available to Shareholders to Adjusted Earnings and Adjusted Earnings, Less Notable Items, and Reconciliation of Net Income (Loss) Available to Shareholders per Common Share to Adjusted Earnings per Common Share and Adjusted Earnings, Less Notable Items per Common Share (Unaudited, in millions except per share data)

						For the Three Months Ended																														For the Year Ended
ADJUSTED EARNINGS, LESS NOTABLE ITEMS (1)						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022												December 31, 2022						December 31, 2021
Net income (loss) available to shareholders						$110						$388						$1,719						$1,558												$3,775						$1,554
Less: Net investment gains (losses)						(69)						(45)						(66)						(68)												(248)						(59)
Less: Net derivative gains (losses), excluding investment hedge adjustments						(1,956)						(615)						1,968						(60)												(663)						(4,004)
Less: Change in market risk benefits						1,479						984						62						1,579												4,104						4,134
Less: Market value adjustments and other						(3)						20						32						38												87						17
Less: Provision for income tax (expense) benefit on reconciling adjustments						114						(71)						(421)						(311)												(689)						(20)
Adjusted earnings						545						115						144						380												1,184						1,486
Less: Notable items						263						41						(209)						(31)												64						(319)
Adjusted earnings, less notable items						$282						$74						$353						$411												$1,120						$1,805
ADJUSTED EARNINGS, LESS NOTABLE ITEMS PER COMMON SHARE (1), (2)
Net income (loss) available to shareholders per common share						$1.59						$5.39						$22.91						$20.11												$51.30						$18.39
Less: Net investment gains (losses)						(0.99)						(0.63)						(0.88)						(0.88)												(3.37)						(0.70)
Less: Net derivative gains (losses), excluding investment hedge adjustments						(28.04)						(8.55)						26.25						(0.77)												(9.01)						(47.40)
Less: Change in market risk benefits						21.20						13.67						0.83						20.38												55.78						48.94
Less: Market value adjustments and other						(0.04)						0.28						0.43						0.49												1.18						0.20
Less: Provision for income tax (expense) benefit on reconciling adjustments						1.63						(0.99)						(5.62)						(4.01)												(9.36)						(0.24)
Adjusted earnings per common share						7.81						1.61						1.91						4.91												16.09						17.60
Less: Notable items						3.77						0.57						(2.79)						(0.40)												0.87						(3.78)
Adjusted earnings, less notable items per common share						$4.04						$1.03						$4.71						$5.30												$15.22						$21.37
(1) Certain definitions have been updated due to the adoption of LDTI. See definitions for Non-GAAP and Other Financial Disclosures in this Appendix.
(2) Per share calculations are on a diluted basis and may not recalculate or foot due to rounding.

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Financial Supplement

A-8

Reconciliation of Return on Common Equity to Adjusted Return on Common Equity, Excluding AOCI (Unaudited, dollars in millions)

						Four Quarters Cumulative Trailing Basis
ADJUSTED EARNINGS (1)						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021
Net income (loss) available to shareholders						$3,775						$4,887						$6,554						$6,232						$1,554
Less: Net investment gains (losses)						(248)						(239)						(268)						(272)						(59)
Less: Net derivative gains (losses), excluding investment hedge adjustments						(663)						1,724						3,816						(240)						(4,004)
Less: Change in market risk benefits						4,104						3,500						3,282						6,316						4,134
Less: Market value adjustments and other						87						120						140						152						17
Less: Provision for income tax (expense) benefit on reconciling adjustments						(689)						(1,071)						(1,464)						(1,244)						(20)
Adjusted earnings						$1,184						$853						$1,048						$1,520						$1,486
						Five Quarters Average Stockholders' Equity Basis
BRIGHTHOUSE FINANCIAL, INC.’S COMMON STOCKHOLDERS’ EQUITY, EXCLUDING AOCI (1)						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021
Brighthouse Financial, Inc.’s stockholders’ equity						$6,584						$6,847						$7,596						$7,804						$8,549
Less: Preferred stock, net						1,699						1,631						1,563						1,496						1,428
Brighthouse Financial, Inc.’s common stockholders’ equity						4,885						5,216						6,033						6,308						7,121
Less: AOCI						(3,958)						(3,421)						(2,223)						(1,247)						917
Brighthouse Financial, Inc.’s common stockholders’ equity, excluding AOCI						$8,843						$8,637						$8,256						$7,555						$6,204
						Five Quarters Average Common Stockholders' Equity Basis
ADJUSTED RETURN ON COMMON EQUITY, EXCLUDING AOCI (1)						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021
Return on common equity						77.3%						93.7%						108.6%						98.8%						21.8%
Return on AOCI						(95.4)%						(142.9)%						(294.8)%						(499.8)%						169.5%
Return on common equity, excluding AOCI						42.7%						56.6%						79.4%						82.5%						25.0%
Less: Return on net investment gains (losses)						(2.8)%						(2.8)%						(3.2)%						(3.6)%						(1.0)%
Less: Return on net derivative gains (losses), excluding investment hedge adjustments						(7.5)%						20.0%						46.2%						(3.2)%						(64.5)%
Less: Return on change in market risk benefits						46.4%						40.5%						39.7%						83.6%						66.6%
Less: Return on market value adjustments and other						1.0%						1.4%						1.7%						2.0%						0.2%
Less: Return on provision for income tax (expense) benefit on reconciling adjustments						(7.8)%						(12.4)%						(17.7)%						(16.4)%						(0.3)%
Adjusted return on common equity, excluding AOCI						13.4%						9.9%						12.7%						20.1%						24.0%
(1) Simplified averaging was applied to all periods presented for 2022 and December 31, 2021.

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Financial Supplement

A-9

Reconciliation of Total Revenues to Adjusted Revenues and Reconciliation of Total Expenses to Adjusted Expenses (Unaudited, in millions)

						For the Three Months Ended																								For the Year Ended
						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022												December 31, 2022						December 31, 2021
Total revenues						$(127)						$1,121						$3,866						$2,013												$6,873						$4,976
Less: Net investment gains (losses)						(69)						(45)						(66)						(68)												(248)						(59)
Less: Net derivative gains (losses)						(1,923)						(592)						1,977						(54)												(592)						(3,983)
Less: Investment hedge adjustments						(33)						(23)						(9)						(6)												(71)						(21)
Total adjusted revenues						$1,898						$1,781						$1,964						$2,141												$7,784						$9,039
Total expenses						$(167)						$609						$1,689						$10												$2,141						$2,967
Less: Change in market risk benefits						(1,479)						(984)						(62)						(1,579)												(4,104)						(4,134)
Less: Market value adjustments						3						(20)						(32)						(38)												(87)						(17)
Total adjusted expenses						$1,309						$1,613						$1,783						$1,627												$6,332						$7,118

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Financial Supplement

A-10

Investment Reconciliation Details (Unaudited, dollars in millions)

						For the Three Months Ended																														For the Year Ended
NET INVESTMENT GAINS (LOSSES)						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021						December 31, 2022						December 31, 2021
Investment portfolio gains (losses)						$(47)						$(47)						$(66)						$(61)						$9						$(221)						$(15)
Investment portfolio credit loss (provision) release and (writedowns)						(22)						2						—						(7)						(32)						(27)						(44)
Net investment gains (losses)						$(69)						$(45)						$(66)						$(68)						$(23)						$(248)						$(59)

						For the Three Months Ended
NET INVESTMENT INCOME YIELD (1)						December 31, 2022						September 30, 2022						June 30, 2022						March 31, 2022						December 31, 2021
Investment income yield						3.94%						3.35%						4.06%						4.50%						4.80%
Investment fees and expenses						(0.15)%						(0.15)%						(0.14)%						(0.14)%						(0.14)%
Net investment income yield						3.79%						3.20%						3.92%						4.36%						4.66%
(1) See definitions for Non-GAAP and Other Financial Disclosures in this Appendix.