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Lending Activities
 3 Months Ended 12 Months Ended
Mar. 31, 2023
Dec. 31, 2022
Receivables [Abstract]    
Lending Activities
The following table presents the composition of Mortgage and other loans receivable, net:
(in millions)March 31, 2023December 31, 2022
Commercial mortgages(a)
$33,692 $32,993 
Residential mortgages6,627 5,856 
Life insurance policy loans1,740 1,750 
Commercial loans, other loans and notes receivable(b)
4,469 4,567 
Total mortgage and other loans receivable
46,528 45,166 
Allowance for credit losses(c)
(659)(600)
Mortgage and other loans receivable, net
$45,869 $44,566 
__________________
(a)Commercial mortgages primarily represent loans for apartments, offices and retail properties, with exposures in New York and California representing the largest geographic concentrations (aggregating approximately 19% and 10%, respectively, at March 31, 2023, and 20% and
11%, respectively, at December 31, 2022). The weighted average loan-to-value ratio for NY and CA was 60% and 54% at March 31, 2023, respectively, and 59% and 53% at December 31, 2022, respectively. The debt service coverage ratio for NY and CA was 2.0X and 2.1X at March 31, 2023, respectively, and 2.0X and 2.1X at December 31, 2022, respectively.
(b)Includes loans held for sale which are carried at lower cost or market, determined on an individual loan basis, and are collateralized primarily by apartments. As of March 31, 2023 and December 31, 2022, the net carrying value of these loans was $173 million and $170 million, respectively.
(c)Does not include allowance for credit losses of $54 million and $60 million at March 31, 2023 and December 31, 2022, respectively in relation to off-balance-sheet commitments to fund commercial mortgage loans, which is recorded in Other liabilities.
Interest income is not accrued when payment of contractual principal and interest is not expected. Any cash received on impaired loans is generally recorded as a reduction of the current carrying amount of the loan. Accrual of interest income is generally resumed when delinquent contractual principal and interest are repaid or when a portion of the delinquent contractual payments are made, and the ongoing required contractual payments have been made for an appropriate period. As of March 31, 2023, $2 million and $650 million of residential mortgage loans and commercial mortgage loans, respectively, were placed on nonaccrual status. As of December 31, 2022, $3 million and $623 million of residential mortgage loans and commercial mortgage loans, respectively, were placed on nonaccrual status.    
Accrued interest is presented separately and is included in Accrued investment income on the Condensed Consolidated Balance Sheets. As of March 31, 2023, accrued interest receivable was $17 million and $147 million associated with residential mortgage loans and commercial mortgage loans, respectively. As of December 31, 2022, accrued interest receivable was $15 million and $130 million associated with residential mortgage loans and commercial mortgage loans, respectively.
A significant majority of commercial mortgages in the portfolio are non-recourse loans and, accordingly, the only guarantees are for specific items that are exceptions to the non-recourse provisions. It is therefore extremely rare for us to have cause to enforce the provisions of a guarantee on a commercial real estate or mortgage loan.
Nonperforming loans are generally those loans where payment of contractual principal or interest is more than 90 days past due. Nonperforming mortgages were not significant for all periods presented.
CREDIT QUALITY OF COMMERCIAL MORTGAGES
The following table presents debt service coverage ratios* for commercial mortgages by year of vintage:
March 31, 2023
(in millions)20232022202120202019PriorTotal
>1.2X$307 $5,471 $2,061 $1,177 $4,918 $13,530 $27,464 
1.00 - 1.20X46 993 857 755 358 1,399 4,408 
<1.00X— 38 — 23 — 1,759 1,820 
Total commercial mortgages
$353 $6,502 $2,918 $1,955 $5,276 $16,688 $33,692 
December 31, 2022
(in millions)20222021202020192018PriorTotal
>1.2X$5,382 $2,043 $1,521 $4,832 $3,505 $9,948 $27,231 
1.00 - 1.20X859 734 388 343 470 1,088 3,882 
<1.00X37 — 23 52 707 1,061 1,880 
Total commercial mortgages
$6,278 $2,777 $1,932 $5,227 $4,682 $12,097 $32,993 
__________________
*The debt service coverage ratio compares a property’s net operating income to its debt service payments, including principal and interest. Our weighted average debt service coverage ratio was 1.9X at March 31, 2023 and 1.9X at December 31, 2022. The debt service coverage ratios are updated when additional information becomes available.
The following table presents loan-to-value ratios* for commercial mortgages by year of vintage:
March 31, 2023
(in millions)20232022202120202019PriorTotal
Less than 65%$321 $5,461 $2,210 $1,535 $3,795 $12,215 $25,537 
65% to 75%32 1,006 428 269 1,431 2,313 5,479 
76% to 80%— 35 43 — — 301 379 
Greater than 80%— — 237 151 50 1,859 2,297 
Total commercial mortgages
$353 $6,502 $2,918 $1,955 $5,276 $16,688 $33,692 
December 31, 2022
(in millions)20222021202020192018PriorTotal
Less than 65%$5,270 $2,061 $1,515 $3,752 $2,666 $9,205 $24,469 
65% to 75%973 435 391 1,425 1,356 1,184 5,764 
76% to 80%35 43 — — 70 218 366 
Greater than 80%— 238 26 50 590 1,490 2,394 
Total commercial mortgages
$6,278 $2,777 $1,932 $5,227 $4,682 $12,097 $32,993 
__________________
*The loan-to-value ratio compares the current unpaid principal balance of the loan to the estimated fair value of the underlying property collateralizing the loan. Our weighted average loan-to-value ratio was 58% at March 31, 2023, and 59% at December 31, 2022. The loan-to-value ratios reflect the latest obtained valuations of the collateral properties. We update the valuations of collateral properties by obtaining independent appraisals, generally at least once per year.
The following table presents the credit quality performance indicators for commercial mortgages:
(dollars in millions)Number
of
Loans		ClassPercent
 of
Total
ApartmentsOfficesRetailIndustrialHotelOthers
Total(b)
March 31, 2023
Credit Quality Performance Indicator:
In good standing607 $13,344 $8,614 $3,602 $5,540 $1,853 $298 $33,251 99 %
90 days or less delinquent2 276 — — — — — 276 1 %
>90 days delinquent or in process of foreclosure(c)
3 — 165 — — — — 165 — %
Total(a)
612 $13,620 $8,779 $3,602 $5,540 $1,853 $298 $33,692 100 %
Allowance for credit losses$89 $348 $56 $66 $21 $6 $586 2 %
December 31, 2022
Credit Quality Performance Indicator:
In good standing599 $13,226 $8,470 $3,192 $5,417 $1,749 $290 $32,344 98 %
Restructured9 — 329 94 — 59 — 482 1 %
90 days or less delinquent— — — — — — — — — %
>90 days delinquent or in process of foreclosure(c)
3 — 167 — — — — 167 1 %
Total(a)
611 $13,226 $8,966 $3,286 $5,417 $1,808 $290 $32,993 100 %
Allowance for credit losses$89 $294 $54 $65 $23 $6 $531 2 %
__________________
(a)Does not reflect allowance for credit losses.
(b)Our commercial mortgage loan portfolio is current as to payments of principal and interest, for both periods presented. There were no significant amounts of nonperforming commercial mortgages (defined as those loans where payment of contractual principal or interest is more than 90 days past due) during any of the periods presented.
(c)Includes $157 million and $156 million of Office loans supporting the Fortitude Re funds withheld arrangements, greater than 90 days delinquent or in process of foreclosure, at March 31, 2023 and December 31, 2022, respectively.
The following table presents credit quality performance indicators for residential mortgages by year of vintage:
March 31, 2023
(in millions)20232022202120202019PriorTotal
FICO*:
780 and greater$70 $477 $2,326 $646 $233 $511 $4,263 
720 - 779269 523 509 168 71 194 1,734 
660 - 71972 230 81 34 16 94 527 
600 - 6592 21 6 — 2 47 78 
Less than 600— — 1 — 1 23 25 
Total residential mortgages
$413 $1,251 $2,923 $848 $323 $869 $6,627 
December 31, 2022
(in millions)20222021202020192018PriorTotal
FICO*:
780 and greater$294 $2,141 $652 $229 $76 $437 $3,829 
720 - 779536 711 167 75 32 134 1,655 
660 - 719163 79 28 16 9 47 342 
600 - 6592 4 2 1 2 13 24 
Less than 600— — — 1 — 5 6 
Total residential mortgages
$995 $2,935 $849 $322 $119 $636 $5,856 
__________________
*Fair Isaac Corporation (“FICO”) is the credit quality indicator used to evaluate consumer credit risk for residential mortgage loan borrowers and has been updated within the last twelve months.
 6.     Lending Activities
Mortgage and other loans receivable include commercial mortgages, residential mortgages, policy loans on life and annuity contracts, commercial loans, and other loans and notes receivable. Commercial mortgages, residential mortgages, commercial loans, and other loans and notes receivable are carried at unpaid principal balances less allowance for credit losses and plus or minus adjustments for the accretion or amortization of discount or premium. Interest income on such loans is accrued as earned.
Direct costs of originating commercial mortgages, commercial loans, and other loans and notes receivable, net of nonrefundable points and fees, are deferred and included in the carrying amount of the related receivables. The amount deferred is amortized to income as an adjustment to earnings using the interest method. Premiums and discounts on purchased residential mortgages are also amortized to income as an adjustment to earnings using the interest method.
Policy loans on life and annuity contracts are carried at unpaid principal balances. There is no allowance for policy loans because these loans serve to reduce the death benefit paid when the death claim is made, and the balances are effectively collateralized by the cash surrender value of the policy or annuity.
The following table presents the composition of Mortgage and other loans receivable, net:
(in millions)December 31, 2022December 31, 2021
Commercial mortgages(a)
$32,993 $30,528 
Residential mortgages5,856 4,672 
Life insurance policy loans1,750 1,832 
Commercial loans, other loans and notes receivable(b)
4,567 2,852 
Total mortgage and other loans receivable
45,166 39,884 
Allowance for credit losses(c)
(600)(496)
Mortgage and other loans receivable, net
$44,566 $39,388 
__________________
(a)Commercial mortgages primarily represent loans for apartments, offices and retail properties, with exposures in New York and California representing the largest geographic concentrations (aggregating approximately 20% and 11%, respectively, at December 31, 2022, and 22% and 10%, respectively, at December 31, 2021). The weighted average loan-to-value ratio for NY and CA was 59% and 53% at December 31, 2022, respectively, and 51% and 53% at December 31, 2021, respectively. The debt service coverage ratio for NY and CA was 2.0X and 2.1X at December 31, 2022, respectively, and 2.0X and 1.9X at December 31, 2021, respectively.
(b)Includes loans held for sale which are carried at lower cost or market, determined on an individual loan basis, and are collateralized primarily by apartments. As of December 31, 2022 and December 31, 2021, the net carrying value of these loans was $170 million and $15 million, respectively.
(c)Does not include allowance for credit losses of $60 million and $57 million at December 31, 2022 and December 31, 2021, respectively in relation to off-balance-sheet commitments to fund commercial mortgage loans, which is recorded in Other liabilities.
Interest income is not accrued when payment of contractual principal and interest is not expected. Any cash received on impaired loans is generally recorded as a reduction of the current carrying amount of the loan. Accrual of interest income is generally resumed when delinquent contractual principal and interest are repaid or when a portion of the delinquent contractual payments are made, and the ongoing required contractual payments have been made for an appropriate period. As of December 31, 2022, $3 million and $623 million of residential mortgage loans and commercial mortgage loans, respectively, were placed on nonaccrual status. As of December 31, 2021, $7 million and $118 million of residential mortgage loans and commercial mortgage loans, respectively, were placed on nonaccrual status.
Accrued interest is presented separately and is included in Accrued investment income on the Consolidated Balance Sheets. As of December 31, 2022, accrued interest receivable was $15 million and $130 million associated with residential mortgage loans and commercial mortgage loans, respectively. As of December 31, 2021, accrued
interest receivable was $11 million and $109 million associated with residential mortgage loans and commercial mortgage loans, respectively.
A significant majority of commercial mortgages in the portfolio are non-recourse loans and, accordingly, the only guarantees are for specific items that are exceptions to the non-recourse provisions. It is therefore extremely rare for us to have cause to enforce the provisions of a guarantee on a commercial real estate or mortgage loan.
Nonperforming loans are generally those loans where payment of contractual principal or interest is more than 90 days past due. Nonperforming mortgages were not significant for all periods presented.
CREDIT QUALITY OF COMMERCIAL MORTGAGES
The following table presents debt service coverage ratios(a) for commercial mortgages by year of vintage:
December 31, 2022
(in millions)20222021202020192018PriorTotal
>1.2X$5,382 $2,043 $1,521 $4,832 $3,505 $9,948 $27,231 
1.00 - 1.20X859 734 388 343 470 1,088 3,882 
<1.00X37 — 23 52 707 1,061 1,880 
Total commercial mortgages
$6,278 $2,777 $1,932 $5,227 $4,682 $12,097 $32,993 
December 31, 2021
(in millions)20212020201920182017PriorTotal
>1.2X$1,861 $1,520 $4,915 $3,300 $2,997 $9,005 $23,598 
1.00 - 1.20X463 810 598 1,030 88 1,684 4,673 
<1.00X— 27 71 826 — 1,333 2,257 
Total commercial mortgages
$2,324 $2,357 $5,584 $5,156 $3,085 $12,022 $30,528 
The following table presents loan-to-value ratios(b) for commercial mortgages by year of vintage:
December 31, 2022
(in millions)20222021202020192018PriorTotal
Less than 65%$5,270 $2,061 $1,515 $3,752 $2,666 $9,205 $24,469 
65% to 75%973 435 391 1,425 1,356 1,184 5,764 
76% to 80%35 43 — — 70 218 366 
Greater than 80%— 238 26 50 590 1,490 2,394 
Total commercial mortgages
$6,278 $2,777 $1,932 $5,227 $4,682 $12,097 $32,993 
December 31, 2021
(in millions)20212020201920182017PriorTotal
Less than 65%$1,859 $1,935 $3,912 $4,072 $2,384 $8,264 $22,426 
65% to 75%304 396 1,672 1,084 340 2,814 6,610 
76% to 80%— — — — 188 259 447 
Greater than 80%161 26 — — 173 685 1,045 
Total commercial mortgages
$2,324 $2,357 $5,584 $5,156 $3,085 $12,022 $30,528 
__________________
(a)The debt service coverage ratio compares a property’s net operating income to its debt service payments, including principal and interest. Our weighted average debt service coverage ratio was 1.9X at December 31, 2022 and 1.9X at December 31, 2021. The debt service coverage ratios have been updated within the last three months. The debt service coverage ratios are updated when additional information becomes available.
(b)The loan-to-value ratio compares the current unpaid principal balance of the loan to the estimated fair value of the underlying property collateralizing the loan. Our weighted average loan-to-value ratio was 59% at December 31, 2022, and 57% at December 31, 2021. The loan-to-value ratios have been updated within the last three to nine months.
The following table presents the credit quality performance indicators for commercial mortgages:
(dollars in millions)Number
of
Loans		ClassPercent
 of
Total
ApartmentsOfficesRetailIndustrialHotelOthers
Total(c)
December 31, 2022
Credit Quality Performance Indicator:
In good standing599 $13,226 $8,470 $3,192 $5,417 $1,749 $290 $32,344 98 %
Restructured(a)
9 — 329 94 — 59 — 482 1 %
90 days or less delinquent— — — — — — — — — %
>90 days delinquent or in process of foreclosure 3 — 167 — — — — 167 1 %
Total(b)
611 $13,226 $8,966 $3,286 $5,417 $1,808 $290 $32,993 100 %
Allowance for credit losses
$89 $294 $54 $65 $23 $6 $531 2 %
December 31, 2021
Credit Quality Performance Indicator:
In good standing613 $12,394 $8,370 $4,026 $3,262 $1,726 $301 $30,079 99 %
Restructured(a)
7 — 269 17 — 104 — 390 1 %
90 days or less delinquent— — — — — — — — — %
>90 days delinquent or in process of foreclosure4 — 59 — — — — 59 — %
Total(b)
624 $12,394 $8,698 $4,043 $3,262 $1,830 $301 $30,528 100 %
Allowance for credit losses$93 $193 $69 $39 $23 $6 $423 1 %
___________________
(a)Loans that have been modified in troubled debt restructurings and are performing according to their restructured terms. For additional discussion of troubled debt restructurings, see the paragraphs below.
(b)Does not reflect allowance for credit losses.
(c)Our commercial mortgage loan portfolio is current as to payments of principal and interest, for both periods presented. There were no significant amounts of nonperforming commercial mortgages (defined as those loans where payment of contractual principal or interest is more than 90 days past due) during any of the periods presented.
The following table presents credit quality performance indicators for residential mortgages by year of vintage:
December 31, 2022
(in millions)20222021202020192018PriorTotal
FICO*:
780 and greater$294 $2,141 $652 $229 $76 $437 $3,829 
720 - 779536 711 167 75 32 134 1,655 
660 - 719163 79 28 16 9 47 342 
600 - 6592 4 2 1 2 13 24 
Less than 600— — — 1 — 5 6 
Total residential mortgages
$995 $2,935 $849 $322 $119 $636 $5,856 
December 31, 2021
(in millions)20212020201920182017PriorTotal
FICO*:
780 and greater$1,398 $678 $284 $100 $107 $325 $2,892 
720 - 7791,118 225 83 41 36 94 1,597 
660 - 71944 39 20 11 13 33 160 
600 - 6591 1 2 3 2 6 15 
Less than 600— — — 1 1 6 8 
Total residential mortgages
$2,561 $943 $389 $156 $159 $464 $4,672 
__________________
*Fair Isaac Corporation (“FICO”) is the credit quality indicator used to evaluate consumer credit risk for residential mortgage loan borrowers and has been updated within the last three months.
METHODOLOGY USED TO ESTIMATE THE ALLOWANCE FOR CREDIT LOSSES
At the time of origination or purchase, an allowance for credit losses is established for mortgage and other loan receivables and is updated each reporting period. Changes in the allowance for credit losses are recorded in net realized gains (losses). This allowance reflects the risk of loss, even when that risk is remote, and reflects losses expected over the remaining contractual life of the loan. The allowance for credit losses considers available relevant information about the collectability of cash flows, including information about past events, current conditions, and reasonable and supportable forecasts of future economic conditions. We revert to historical information when we determine that we can no longer reliably forecast future economic assumptions.
The allowances for the commercial mortgage loans and residential mortgage loans are estimated utilizing a probability of default and loss given default model. Loss rate factors are determined based on historical data and adjusted for current and forecasted information. The loss rates are applied based on individual loan attributes and considering such data points as loan-to-value ratios, FICO scores, and debt service coverage.
The estimate of credit losses also reflects management’s assumptions on certain macroeconomic factors that include, but are not limited to, gross domestic product growth, employment, inflation, housing price index, interest rates and credit spreads.
Accrued interest is excluded from the measurement of the allowance for credit losses and accrued interest is reversed through interest income once a loan is placed on non-accrual.
When all or a portion of a loan is deemed uncollectible, the uncollectible portion of the carrying amount of the loan is charged off against the allowance.
We also have off-balance sheet commitments related to our commercial mortgage loans. The liability for expected credit losses related to these commercial mortgage loan commitments is reported in Other liabilities in the Consolidated Balance Sheets. When a commitment is funded, we record a loan receivable and reclassify the liability
for expected credit losses related to the commitment into loan allowance for expected credit losses. Other changes in the liability for expected credit losses on loan commitments are recorded in Net realized gains (losses) in the Consolidated Statements of Income (Loss).
Years Ended December 31,202220212020
(in millions)Commercial MortgagesOther LoansTotalCommercial MortgagesOther LoansTotalCommercial MortgagesOther LoansTotal
Allowance, beginning of year
$423 $73 $496 $546 $111 $657 $266 $91 $357 
Initial allowance upon CECL adoption— — — — — — 272 2 274 
Loans charged off(13)— (13)(1)— (1)(12)(5)(17)
Net charge-offs
(13)— (13)(1)— (1)(12)(5)(17)
Addition to (release of) allowance for loan losses121 (4)117 (122)(19)(141)20 23 43 
Divestitures— — — — (19)(19)— — — 
Allowance, end of year
$531 $69 $600 $423 $73 $496 $546 $111 $657 
_________________
As a result of the COVID-19 pandemic, including the significant global economic slowdown and general market decline, our expectations and models used to estimate the allowance for losses on commercial and residential mortgage loans have been updated to reflect the economic environment. The full impact of COVID-19 on real estate valuations remains uncertain and we will continue to review our valuations as further information becomes available.
TROUBLED DEBT RESTRUCTURINGS
We modify loans to optimize their returns and improve their collectability, among other things. When we undertake such a modification with a borrower that is experiencing financial difficulty and the modification involves us granting a concession to the troubled debtor, the modification is a troubled debt restructuring (“TDR”). We assess whether a borrower is experiencing financial difficulty based on a variety of factors, including the borrower’s current default on any of its outstanding debt, the probability of a default on any of its debt in the foreseeable future without the modification, the insufficiency of the borrower’s forecasted cash flows to service any of its outstanding debt (including both principal and interest) and the borrower’s inability to access alternative third-party financing at an interest rate that would be reflective of current market conditions for a non-troubled debtor. Concessions granted may include extended maturity dates, interest rate changes, principal or interest forgiveness, payment deferrals and easing of loan covenants.
During the years ended December 31, 2022 and 2021, loans with a carrying value of $143 million and $280 million, respectively, were modified in TDRs.
The following table presents a rollforward of the changes in the allowance for credit losses on Mortgage and other loans receivable:*
Three Months Ended March 31,20232022
(in millions)Commercial MortgagesOther LoansTotalCommercial MortgagesOther LoansTotal
Allowance, beginning of period
$531 $69 $600 $423 $73 $496 
Loans charged off— — — (5)— (5)
Net charge-offs
— — — (5)— (5)
Addition to (release of) allowance for loan losses55 4 59 $(5)$2 $(3)
Divestitures— — — — — — 
Allowance, end of period
$586 $73 $659 $413 $75 $488 
__________________
*Does not include allowance for credit losses of $54 million and $93 million, respectively, at March 31, 2023 and 2022 in relation to the off-balance-sheet commitments to fund commercial mortgage loans, which is recorded in Other liabilities in the Condensed Consolidated Balance Sheets.
Our expectations and models used to estimate the allowance for losses on commercial and residential mortgage loans are regularly updated to reflect the current economic environment.
LOAN MODIFICATIONS
The allowance for credit losses incorporates an estimate of lifetime expected credit losses and is recorded on each asset upon asset origination or acquisition. The starting point for the estimate of the allowance for credit losses is historical loss information, which includes losses from modifications of receivables to borrowers experiencing financial difficulty. We use a probability of default/loss given default model to determine the allowance for credit
losses for our commercial and residential mortgage loans. An assessment of whether a borrower is experiencing financial difficulty is made on the date of a modification.
Because the effect of most modifications made to borrowers experiencing financial difficulty is already included in the allowance for credit losses utilizing the measurement methodologies used to estimate the allowance, a change to the allowance for credit losses is generally not recorded upon modification.
When modifications are executed, they often will be in the form of principal forgiveness, term extensions, interest rate reductions, or some combination of any of these concessions. When principal is forgiven, the amortized cost basis of the asset is written off against the allowance for credit losses. The amount of the principal forgiveness is deemed to be uncollectible; therefore, that portion of the loan is written off, resulting in a reduction of the amortized cost basis and a corresponding adjustment to the allowance for credit losses.
We assess whether a borrower is experiencing financial difficulty based on a variety of factors, including the borrower’s current default on any of its outstanding debt, the probability of a default on any of its debt in the foreseeable future without the modification, the insufficiency of the borrower’s forecasted cash flows to service any of its outstanding debt (including both principal and interest), and the borrower’s inability to access alternative third party financing at an interest rate that would be reflective of current market conditions for a non-troubled debtor.
During the three-month period ended March 31, 2023, Corebridge did not modify any loans to borrowers experiencing financial difficulty.
There were no loans that had defaulted during the three-month period ended March 31, 2023, that had been previously modified with borrowers experiencing financial difficulties.
Prior to January 1, 2023, we were required to assess loan modifications to determine if they were a TDR. A TDR was a modification of a loan with a borrower that was experiencing financial difficulty and the modification involved us granting a concession to the troubled borrower. Concessions previously granted included extended maturity dates, interest rate changes, principal or interest forgiveness, payment deferrals and easing of loan covenants.
During the three-month period ended March 31, 2022, loans with a carrying value of $77 million were modified as troubled debt restructurings. Effective January 1, 2023, we are no longer required to assess whether loan modifications are TDRs.