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What changed in Invesco's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Invesco's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+374 added−412 removedSource: 10-K (2025-02-25) vs 10-K (2024-02-21)

Top changes in Invesco's 2024 10-K

374 paragraphs added · 412 removed · 314 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeThe company operates as an integrated global investment manager, presenting itself as a single firm to clients around the world. Dedicated sales forces deliver our investment strategies through a variety of vehicles that meet the needs of retail and institutional clients.
Biggest changeDedicated sales forces deliver our investment strategies through a variety of vehicles that meet the needs of retail and institutional clients. Note that not all products sold in the retail distribution channel are in "retail" vehicles, and not all products sold in the institutional channel are in "institutional" vehicles, as described in the table below.
(Information contained on our website shall not be deemed to be part of, or be incorporated into, this document.) Industry Trends Trends around the world continue to transform the investment management industry and underscore the need to be well diversified with broad capabilities globally: Individuals and Institutions expect personalized outcomes and experience. • Distribution partners are becoming more selective and continuing to maintain fewer relationships and partners, reducing the number of trusted investment managers with whom they work. • Clients and distribution partners are demanding more from investment managers.
(Information contained on our website shall not be deemed to be part of, or be incorporated into, this document.) 4 Table of Contents Industry Trends Trends around the world continue to transform the investment management industry and underscore the need to be well diversified with broad capabilities globally: Individuals and Institutions expect personalized outcomes and experience • Distribution partners are becoming more selective and continuing to maintain fewer relationships and partners, reducing the number of trusted investment managers with whom they work. • Clients and distribution partners are demanding more from investment managers.
We make available free of charge on our website, www.invesco.com/corporate, our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statement and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. 9 Ta ble of Contents
We make available free of charge on our website, www.invesco.com/corporate, our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statement and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. 9 Table of Contents
We take a unified approach to our business and present our financial statements and other disclosures under the single operating segment “investment management.” A key focus of our business is fostering a strong investment culture and providing the support that enables our investment teams to maintain well-performing investment capabilities.
We take a unified approach to our business and present our financial statements and other disclosures under one operating segment, “investment management.” A key focus of our business is fostering a strong investment culture and providing the support that enables our investment teams to maintain well-performing investment capabilities.
The Americas and EMEA retail operations rank among the largest by AUM in their respective markets. As of December 31, 2023, Invesco's U.S. retail business, including our ETFs franchise, is among the leading asset managers in the U.S., and Invesco's retail business in EMEA is among the largest non-proprietary investment managers in the retail channel.
The Americas and EMEA retail operations rank among the largest by AUM in their respective markets. As of December 31, 2024, Invesco's U.S. retail business, including our ETFs franchise, is among the leading asset managers in the U.S., and Invesco's retail business in EMEA is among the largest non-proprietary investment managers in the retail channel.
The key drivers of success for Invesco are long-term investment performance, high-quality client service and effective distribution relationships delivered across a diverse spectrum of investment management capabilities, distribution channels, geographic areas and market exposures.
The key drivers of success for Invesco are long-term investment performance, high-quality client service, effective distribution relationships delivered across a diverse spectrum of investment management capabilities, distribution channels, geographic areas and market exposures, and competitive pricing.
See the company's disclosures regarding the changes in AUM for the year ended December 31, 2023 in Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations - Assets Under Management” for additional information regarding the changes in AUM.
See the company's disclosures regarding the changes in AUM for the year ended December 31, 2024 in Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations - Assets Under Management” for additional information regarding changes in AUM.
Item 1. Business Introduction Invesco Ltd. (the Parent) and its consolidated subsidiaries (collectively, Invesco or the company) is an independent investment management firm dedicated to delivering a superior investment experience. Our comprehensive range of active, passive and alternative investment capabilities has been constructed over many years to help clients achieve their investment objectives.
Item 1. Business Introduction Invesco Ltd. (the Parent), along with its consolidated entities (collectively, Invesco or the company), is an independent investment management firm dedicated to delivering a superior investment experience. Our comprehensive range of active, passive and alternative investment capabilities has been constructed over many years to help clients achieve their investment objectives.
We have a significant presence in the retail and institutional markets within the investment management industry in the Americas, Europe, Middle East and Africa (EMEA) and Asia-Pacific (APAC), serving clients in more than 120 countries. As of December 31, 2023, the firm managed approximately $1.6 trillion in assets for investors around the world.
We have a significant presence in the retail and institutional markets within the investment management industry in the Americas, Europe, Middle East and Africa (EMEA) and Asia-Pacific (APAC), serving clients in more than 120 countries. As of December 31, 2024, the firm managed approximately $1.85 trillion in assets for investors around the world.
Institutional Institutional AUM were $543.3 billion at December 31, 2023. We offer a broad suite of domestic and global strategies, including traditional and quantitative equities, fixed income (including money market funds for institutional clients), real estate, financial structures and absolute return strategies. Regional sales forces distribute our products and provide services to clients and intermediaries around the world.
Institutional Institutional AUM were $580.4 billion at December 31, 2024. We offer a broad suite of domestic and global strategies, including traditional and quantitative equities, fixed income (including money market funds for institutional clients), real estate, financial structures and absolute return strategies. Regional sales forces distribute our products and provide services to clients and intermediaries around the world.
In addition, Invesco Great Wall Fund Management Company Limited (IGW or Invesco Great Wall), our joint venture in China, is one of the largest Sino-foreign managers of equity products in China, with total AUM of approximately $83.6 billion at December 31, 2023. We provide our retail clients with one of the industry's most robust and comprehensive product lines.
In addition, Invesco Great Wall Fund Management Company Limited (IGW or Invesco Great Wall), our joint venture in China, is one of the largest Sino-foreign managers of equity products in China, with total AUM of approximately $93.2 billion at December 31, 2024. We provide our retail clients with one of the industry's most robust and comprehensive product lines.
AUM Diversification One of Invesco's competitive strengths is the diversification of AUM by client domicile, distribution channel and asset class. We serve clients in more than 120 countries. The following tables present a breakdown of AUM by client domicile, distribution channel and asset class as of December 31, 2023.
AUM Diversification One of Invesco's competitive strengths is the diversification of AUM by client domicile, distribution channel and investment capability. We serve clients in more than 120 countries. The following tables present a breakdown of AUM by client domicile, distribution channel and investment capability as of December 31, 2024.
Competition The investment management business is highly competitive, with points of differentiation including investment performance, fees, range of products offered, brand recognition, business reputation, financial strength, depth and continuity of relationships and quality of service.
This is the foundation of our environmental, health and safety management approach. Competition The investment management business is highly competitive, with points of differentiation including investment performance, fees, range of products offered, brand recognition, business reputation, financial strength, depth and continuity of relationships and quality of service.
The company focuses on four key long-term strategic objectives that are designed to sharpen our focus on client needs, further strengthen our business over time and help ensure our long-term success: Deliver the excellence our clients expect • Achieve strong, long-term investment performance. • Deliver a quality investment process and a frictionless experience with superior engagement. • Provide advice and solutions to help our clients best manage their portfolios and succeed with their own clients.
The firm's strategic priorities are aligned with four key long-term themes that are designed to sharpen our focus on clients' needs, further strengthen our business over time and help ensure our long-term success: Deliver the excellence our clients expect • Achieve strong, long-term investment performance. • Deliver a quality investment process and a frictionless experience with superior engagement. • Provide a holistic value proposition including advice and solutions to help our clients best manage their portfolios and succeed with their own clients.
The following lists our primary investment vehicles by distribution channel: Retail Institutional ● Closed-end Mutual Funds ● Collective Trust Funds ● Exchange-traded funds (ETFs) ● ETFs ● Individual Savings Accounts ● Institutional Separate Accounts ● Investment Companies with Variable Capital ● Open-end Mutual Funds ● Investment Trusts ● Private Funds ● Open-end Mutual Funds ● Separately Managed Accounts (SMA) ● Société d'investissement à Capital Variable ● Unit Investment Trusts (UITs) ● Variable Insurance Funds 6 Ta ble of Contents Retail Retail AUM were $1,042.0 billion at December 31, 2023.
The following lists our primary investment vehicles by distribution channel: Retail Institutional ● Alternative Investment Funds (AIF) ● Collective Trust Funds ● Closed-end Mutual Funds ● ETFs ● Exchange-traded funds (ETFs) ● Institutional Separate Accounts ● Individual Savings Accounts ● Open-end Mutual Funds ● Investment Companies with Variable Capital (ICVC) ● Private Funds ● Investment Trusts ● Real Estate Investment Trusts (REIT) ● Open-end Mutual Funds ● Private Funds ● Separately Managed Accounts (SMA) ● Société d'investissement à Capital Variable (SICAV) ● Unit Investment Trusts (UITs) ● Variable Insurance Funds 6 Table of Contents Retail Retail AUM were $1,265.6 billion at December 31, 2024.
Global asset management leaders will need a considerable footprint in these markets. 4 Ta ble of Contents Structural shifts in client portfolio allocations. • Private market allocations continue to increase and become a meaningful part of retail portfolios, driving industry fee growth as well as innovation and democratization. • Beta, factor, and index offerings will continue to be core to portfolios in transparent, efficient markets.
Structural shifts in client portfolio allocations • Private market allocations continue to increase and become a more meaningful part of retail portfolios, driving industry fee growth as well as innovation and democratization. • Beta, factor, and index offerings will continue to be core to portfolios in transparent, efficient markets.
Institutional AUM originate from entities such as individual corporate clients, insurance companies, endowments, foundations, government authorities, universities or charities. AUM disclosed as retail channel AUM include AUM distributed by the company's retail sales team. AUM disclosed as institutional channel AUM include AUM distributed by the company's institutional sales team.
Institutional AUM originate from entities such as individual corporate clients, insurance companies, endowments, foundations, government authorities, universities or charities. AUM disclosed as retail AUM include AUM distributed by the company's retail sales teams. AUM disclosed as institutional AUM include AUM distributed by the company's institutional sales teams. The company operates as an integrated global investment manager.
Passive (in billions) Total 1-Yr Change c Active $ 985.3 0.9 % c Passive 600.0 38.6 % Total $ 1,585.3 Corporate Responsibility and Human Capital Invesco’s long-term success depends on our ability to retain, develop, engage and attract top talent.
Passive (in billions) Total 1-Yr Change c Active $ 1,026.5 4.2 % c Passive 819.5 36.6 % Total $ 1,846.0 Corporate Responsibility and Human Capital Invesco’s long-term success depends on our ability to retain, develop, engage and attract top talent.
While performance remains paramount, competitive pricing, best-in class experience and value-added services (including portfolio analytics and consultative solutions) increasingly differentiate managers. • The U.S. and China will continue to be the dominant global wealth markets.
While performance remains paramount and competitive pricing is essential, best-in class experience and value-added services (including portfolio analytics and consultative solutions) increasingly differentiate managers.
Note that not all products sold in the retail distribution channel are in "retail" vehicles, and not all products sold in the institutional channel are in "institutional" vehicles, as described in the table below. This aggregation, however, is viewed as a proxy for presenting AUM in the retail and institutional markets in which we operate.
This aggregation, however, is viewed as a proxy for presenting AUM in the retail and institutional markets in which we operate.
Across Invesco offices, we carefully manage our operational activities with a focus on using natural resources wisely, increasing efficiencies wherever possible and providing a safe and healthy workplace for employees and visitors. This is the foundation of our environmental, health and safety management approach.
Our employees are not covered under collective bargaining agreements. The company is committed to reducing our impact on the environment. Across Invesco offices, we carefully manage our operational activities with a focus on using natural resources wisely, increasing efficiencies wherever possible and providing a safe and healthy workplace for employees and visitors.
Invesco invests significantly in talent development, health and welfare programs, technology and other resources that support our employees in developing their full potential both personally and professionally. We believe that an employee community that is diverse and inclusive, engaged in community involvement and invested in employee well-being will drive positive outcomes for our clients and shareholders.
Invesco invests significantly in talent development, health and welfare programs, technology and other resources that support our employees in developing their full potential both personally and professionally.
In this space, clients will demand ease of access and competitive pricing. • Investors have been selecting active strategies, while placing a high bar on proven superior risk-adjusted returns. • Investors have been favoring fixed income strategies in response to unpredictable market conditions and the higher interest rate environment. • Investors have been shifting their investment strategies toward lower fee offerings, and we believe this trend will continue.
In this space, clients will demand ease of access and competitive pricing. • Investors are selecting active strategies and place a high bar on proven and consistent performance. • Investors have been shifting their investment strategies toward passively managed strategies, and we believe this trend will continue.
Create an environment where talented people thrive • Attract and develop high performing, diverse talent with skills aligned to deliver against business outcomes. • Create an inclusive and engaging culture that values diversity of thought which enables us to work as one team to deliver better outcomes.
Create an environment where talented people thrive • Attract and develop high performing, diverse talent with skills aligned to deliver against business outcomes. • Create an inclusive and engaging culture that values diversity of thought which enables us to work as one team to deliver better outcomes. 5 Table of Contents Act like owners for all stakeholders • Embed next generation technology across all aspects of the business • Strengthen financial flexibility emphasizing operating leverage As an integrated global investment manager, we are keenly focused on meeting clients' needs and operating effectively and efficiently.
Strategy At Invesco, we seek to drive sustainable profitable growth by delivering capabilities that build enduring partnerships and create better outcomes for our clients.
We believe the depth and breadth of Invesco's platform position us to understand, anticipate, and meet our clients' needs, successfully competing within our industry over the long term. Strategy At Invesco, we seek to drive sustainable profitable growth by delivering capabilities that build enduring relationships and create better outcomes for our clients.
As of December 31, 2023, the company had 8,489 (December 31, 2022: 8,611 ) employees with an on-the-ground presence in over 20 countries. Our employees are not covered under collective bargaining agreements. The company is committed to reducing our impact on the environment.
We believe that an employee community that is diverse and inclusive, engaged in community involvement and invested in employee well-being will drive positive outcomes for our clients and shareholders. 8 Table of Contents As of December 31, 2024, the company had 8,508 (December 31, 2023: 8,489 ) employees with an on-the-ground presence in over 20 countries.
By Client Domicile (in billions) Total 1-Yr Change c Americas $ 1,133.9 13.5 % c EMEA 215.9 15.9 % c APAC 235.5 5.4 % Total $ 1,585.3 7 Ta ble of Contents By Distribution Channel (in billions) Total 1-Yr Change c Retail $ 1,042.0 19.5 % c Institutional 543.3 1.2 % Total $ 1,585.3 By Asset Class (in billions) Total 1-Yr Change c Equity $ 823.7 29.3 % c Fixed Income 325.7 3.8 % c Balanced 62.7 (6.6) % c Money Market 192.7 (5.3) % c Alternatives 180.5 (3.9) % Total $ 1,585.3 Active vs.
By Client Domicile (in billions) Total 1-Yr Change c Americas $ 1,315.5 16.0 % c EMEA 260.3 20.6 % c APAC 270.2 14.7 % Total $ 1,846.0 7 Table of Contents By Distribution Channel (in billions) Total 1-Yr Change c Retail $ 1,265.6 21.5 % c Institutional 580.4 6.8 % Total $ 1,846.0 By Investment Capability (in billions) Total 1-Yr Change c ETFs and Index $ 484.0 33.7 % c Fundamental Fixed Income 281.1 3.1 % c Fundamental Equities 266.5 2.3 % c Private Markets 128.5 (0.9) % c APAC Managed 118.8 10.0 % c Multi-Asset/Other 58.8 2.4 % c Global Liquidity 189.4 14.8 % c QQQ 318.9 38.7 % Total $ 1,846.0 Active vs.
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These dynamics are driving fundamental changes within the industry and, we believe, will drive increasing consolidation. We believe the steps we have taken over the past decade strengthened our ability to understand, anticipate and meet client needs and will help ensure Invesco is well-positioned to compete within our industry over the long term.
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These dynamics are driving fundamental changes within the industry and, we believe, will drive increasing consolidation. Additionally, the U.S. and China will continue to be the dominant global wealth markets, and global asset management leaders will need a considerable footprint in these markets.
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Grow high demand investment offerings • Deliver ahead of clients’ expectations through product innovation, investment styles, and packaging options. • Focus our offerings at the intersection of high opportunity markets and high demand capabilities.
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We have an advantageous position globally as a diversified, client-centric asset manager and a strategy to deliver for our shareholders.
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Act like owners for all stakeholders • Be disciplined stewards of firm resources with a focus on profitable growth. • Invest in the success of our clients, our shareholders, and ourselves. As an integrated global investment manager, we are keenly focused on meeting clients' needs and operating effectively and efficiently.
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Grow high demand investment offerings • Prioritize the intersection of market size, secular change, and Invesco’s unique position to drive growth in the highest opportunity regions. • Grow high demand private markets capabilities leveraging our strong retail channel and expanding investment strategies. • Drive profitable organic growth, emphasizing high demand, scalable investment capabilities, and delivery vehicles.
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We offer multiple investment objectives within the various asset classes and products that we manage.
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We offer multiple investment objectives within the various asset classes and products that we manage. Our asset classes, broadly defined, include equity, fixed income, balanced, alternatives and money market. Distribution Channels Retail AUM typically originate from clients investing into funds available to the public in the form of shares or units.
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Our asset classes, broadly defined, include equity, fixed income, balanced, alternatives and money market. 5 Ta ble of Contents The following sets forth our major managed investment objectives by asset class: Equity Fixed Income Balanced Alternatives Money Market ● Core/Value/Growth Style ● Buy and Hold ● Balanced Risk ● Absolute Return ● Cash Plus ● Custom Solutions ● Convertibles ● Custom Solutions ● Commodities ● Custom Solutions ● Emerging Markets ● Core/Core Plus ● ESG ● Currencies ● Government/Treasury ● Environmental, Social and Governance (ESG) ● Custom Solutions ● Global/Regional ● Custom Solutions ● Prime ● International/Global ● Emerging Markets ● Single Country ● Direct Lending ● Taxable ● Large/Mid/Small Cap ● ESG ● Target Risk ● Distressed Debt ● Tax-Free ● Low Volatility/Defensive ● Government Bonds ● Traditional Balanced ● ESG ● Passive/Enhanced ● High-Yield Bonds ● Financial Structures ● Regional/Single Country ● International/Global ● Global Macro ● Smart Beta/Factor-based ● Investment Grade Credit ● Infrastructure and MLPs ● Thematic/Sector ● Multi-Sector ● Long/Short Equity ● Municipal Bonds ● Managed Futures ● Passive/Enhanced ● Multi-Alternatives ● Regional/Single Country ● Private Real Estate ● Short/Ultra-Short Duration ● Public Real Estate Securities ● Smart Beta/Factor-based ● Senior Secured Loans ● Stable Value ● Structured Securities Distribution Channels Retail AUM typically originate from clients investing into funds available to the public in the form of shares or units.
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We believe that diversity and inclusion are good for business. We are committed to further strengthening diversity at all levels and in all functions across our global business. Increasing representation of women and diverse employees remains a focus for Invesco, as does building a more inclusive work environment. All employees are required to take periodic unconscious bias training.
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Our employees are also encouraged to participate in any of our various employee resource groups 8 Ta ble of Contents where employees with diverse backgrounds, experiences and perspectives can connect. Our employee resource groups are sponsored by senior leaders and are designed by employees, for employees.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese may include: • risks related to the potential illiquidity, valuation and disposition of such investments; • risks related to emerging and less established companies that have, among other things, short operating histories, not yet achieved or sustained profitability, new technologies and products, nascent control functions, quickly evolving markets and limited financial resources; • construction risks, including as a result of force majeure, labor disputes or work stoppages, shortages of material or interruptions to the availability of necessary equipment; • credit risks, including interest-rate movements and an issuer’s ability to make principal and interest payments on the debt it issues; • risks related to investment in “distressed” securities, including abrupt and erratic market movements and above-average price volatility; • risks associated with a lack of diversification, such that any adverse change in one or a small number of issuers could have a material adverse effect on an investment product’s or client’s investments; • accidents, pandemics, health crises or catastrophic events, climate-related risks, including greater frequency or intensity of adverse weather and natural disasters, that are beyond our control; • personal injury or property damage; • risks relating to the use of leverage, including as a result of increasing interest rates or an inability to timely obtain and effectively deploy leverage; • failures on the part of third-party managers, service providers or sub-contractors appointed in connection with investments or projects to adequately perform their contractual duties or operate in accordance with applicable laws; • exposure to stringent and complex foreign, federal, state and local laws, ordinances and regulations, including those related to private fund advisers, financial crime, permits, government contracting, conservation, exploration and production, lending, tenancy, occupational health and safety, foreign investment and environmental protection; • environmental hazards; • changes to the supply and demand for properties and/or tenancies; • risks related to the availability, cost, coverage and other limitations on insurance; • the financial resources of tenants or loan counterparties; and • contingent liabilities on disposition of investments. 12 Ta ble of Contents The above risks may expose our investment products, clients and us, to the extent of our investment in such investment products, to expenses and liabilities, including costs associated with delays or remediation and increased legal or regulatory costs, all of which could impact the returns earned by our investment products and clients.
Biggest changeThese may include: • risks related to the potential illiquidity, valuation and disposition of such investments; • risks related to emerging and less established companies that have, among other things, short operating histories, not yet achieved or sustained profitability, new technologies and products, nascent control functions, quickly evolving markets and limited financial resources; • construction risks, including as a result of force majeure, labor disputes or work stoppages, shortages of material or interruptions to the availability of necessary equipment; • credit risks, including interest-rate movements and an issuer’s ability to make principal and interest payments on the debt it issues; • risks related to investment in “stressed” and “distressed” securities, including abrupt and erratic market movements, above-average price volatility and bankruptcy; • risks relating to minority equity investments and joint ventures, including limited control over the applicable portfolio investments or joint ventures; • risks associated with a lack of diversification, such that any adverse change in one or a small number of issuers could have a material adverse effect on an investment product’s or client’s investments; • accidents, pandemics, health crises or catastrophic events, climate-related risks, including greater frequency or intensity of adverse weather and natural disasters, that are beyond our control; • personal injury or property damage; • risks relating to reliance on underlying managers and funds to effect fund of funds programs; • risks relating to the use of leverage, including as a result of increasing interest rates or an inability to timely obtain and effectively deploy leverage; • failures on the part of third-party managers, service providers or sub-contractors appointed in connection with investments or projects to adequately perform their contractual duties or operate in accordance with applicable laws; • exposure to stringent and complex foreign, federal, state and local laws, ordinances and regulations, including those related to private fund advisers, financial crime, permits, government contracting, conservation, exploration and production, lending, tenancy, occupational health and safety, employment law and regulation, foreign investment and environmental protection; • environmental hazards; 12 Table of Contents • changes to the supply and demand for properties and/or tenancies; • risks related to the availability, cost, coverage and other limitations on insurance; • the financial resources of tenants or loan counterparties; • contingent liabilities on disposition of investments; and • conflicts of interest related to investments in operating companies.
Poor investment performance (on a relative or absolute basis) as compared to third-party benchmarks or competitive products has in the past led, and could in the future lead, to a termination of investment management agreements, a decrease in sales of our products and stimulate redemptions from existing products, each of which could lower the overall level of AUM, reduce our management fees and negatively impact our revenues and net income.
Poor investment performance (on a relative or absolute basis) as compared to third-party benchmarks or competitive products has in the past led, and could in the future lead, to a termination of investment management agreements, a decrease in sales of our products or stimulate redemptions from existing products, each of which could lower the overall level of AUM, reduce our management fees and negatively impact our revenues and net income.
In addition, market conditions may change during the course of real estate development projects in which our investment products and clients invest that make such developments less attractive than at the time it was commenced and potentially harm the investment returns of our investment products and clients and us, to the extent of our investment in such investment products.
In addition, market conditions may change during the course of real estate development projects in which our investment products and clients invest that make such developments less attractive than at the time it was commenced and potentially harm the investment returns of our investment products, our clients and, to the extent of our investment in such investment products, us.
The revenues and profitability of investment products and clients may be subordinated (and thus exposed to the first level of default risk) or otherwise subject to substantial credit risks. Certain investments have a comparatively higher degree of risk of a loss of capital and may not show any return for a considerable period of time, including second lien debt.
The revenues and profitability of investment products and clients may be subordinated (and thus exposed to the first level of default risk) or otherwise subject to substantial credit risks. Certain investments, including second lien debt, have a comparatively higher degree of risk of a loss of capital and may not show any return for a considerable period of time.
Bermuda law differs from the laws in effect in the U.S. and may afford less protection to shareholders. Our shareholders may have more difficulty protecting their interests than shareholders of a company incorporated in a jurisdiction of the U.S. As a Bermuda company, we are governed by the Companies Act 1981 of Bermuda (Companies Act).
Bermuda law differs from the laws in effect in the U.S. and may afford less protection to shareholders. Our shareholders may have more difficulty protecting their interests than shareholders of a company incorporated in a jurisdiction of the U.S. As a Bermuda company, we are governed by the Companies Act 1981 of Bermuda (the Companies Act).
Shareholders of Bermuda companies do not generally have rights to take action against directors or officers of the company, and may only do so in limited circumstances described in the following paragraph. However, directors and officers may owe duties to a company's creditors in cases of impending insolvency.
Shareholders of Bermuda companies do not generally have rights to take action against directors or officers of the company, and may do so only in limited circumstances described in the following paragraph. However, directors and officers may owe duties to a company's creditors in cases of impending insolvency.
However, the Bermuda courts ordinarily would be expected to follow English case law precedent, which would permit a shareholder to commence an action in a company's name against the directors and officers to remedy a wrong done to the company where the act complained of is alleged to be beyond the company's corporate power or is illegal or would result in the violation of the company's memorandum of association or Bye-Laws.
However, Bermuda courts ordinarily would be expected to follow English case law precedent, which would permit a shareholder to commence an action in a company's name against the directors and officers to remedy a wrong done to the company where the act complained of is alleged to be beyond the company's corporate power or is illegal or would result in the violation of the company's memorandum of association or Bye-Laws.
Therefore, a final judgment for the payment of money rendered by any federal or state court in the U.S. based on civil liability, whether or not based solely on U.S. federal or state securities laws, would not automatically be enforceable in Bermuda. Similarly, those judgments may not be enforceable in other countries other than the U.S.
Therefore, a final judgment for the payment of money rendered by any federal or state court in the U.S. based on civil liability, whether or not based solely on U.S. federal or state securities laws, would not automatically be enforceable in Bermuda. Similarly, those judgments may not be enforceable in countries other than the U.S.
We have anti-takeover provisions in our Bye-Laws that may discourage a change of control. Our Bye-Laws contain provisions that could make it more difficult for a third-party to acquire us or to obtain majority representation on our Board of Directors without the consent of our Board.
We have anti-takeover provisions in our Bye-Laws that may discourage a change of control. Our Bye-Laws contain provisions that could make it more difficult for a third-party to acquire us or to obtain majority representation on our Board of Directors (Board) without the consent of our Board.
Specifically, our Bye-Laws contain the following provisions that may impede or delay a third-party to acquire or obtain majority representation on our Board of Directors: • we are prohibited from engaging, under certain circumstances, in a business combination (as defined in our Bye-Laws) with any interested shareholder (as defined in our Bye-Laws) for three years following the date that the shareholder became an interested shareholder; • our Board of Directors, without further shareholder action, is permitted by our Bye-Laws to issue preference shares, in one or more series, and determine by resolution any designations, preferences, qualifications, privileges, limitations, restrictions or special or relative rights of an additional series.
Specifically, our Bye-Laws contain the following provisions that may impede or delay a third-party to acquire or obtain majority representation on our Board: • we are prohibited from engaging, under certain circumstances, in a business combination (as defined in our Bye-Laws) with any interested shareholder (as defined in our Bye-Laws) for three years following the date that the shareholder became an interested shareholder; • our Board, without further shareholder action, is permitted by our Bye-Laws to issue preference shares, in one or more series, and determine by resolution any designations, preferences, qualifications, privileges, limitations, restrictions or special or relative rights of an additional series.
In this regard: • In the event of extreme circumstances, including an economic, political or business crisis, such as a widespread systemic failures or disruptions in the global or regional financial systems or failures of firms that have significant obligations as counterparties on financial instruments, we may suffer significant declines in AUM and severe liquidity or valuation issues in managed investment products in which client and company assets are invested, all of which would adversely affect our operating results, financial condition, liquidity, credit ratings, ability to access capital markets and ability to retain and attract key employees.
In this regard: • In the event of extreme circumstances, including an economic, political or business crisis, such as widespread systemic failures or disruptions in the global or regional financial systems or failures of firms that have significant obligations as counterparties on financial instruments, we may suffer significant declines in AUM and severe liquidity or valuation issues in managed investment products in which client and company assets are invested, all of which would adversely affect our operating results, financial condition, liquidity, credit ratings, ability to access capital markets and ability to retain and attract key employees.
The asset management industry is facing transformative pressures and trends from a variety of different sources, including increased fee pressure; a continued shift away from actively managed fundamental equities and fixed income strategies towards alternative, passive index and smart beta strategies; increased demands from clients and distributors for client engagement and services; a trend towards institutions concentrating on fewer relationships and partners and reducing the number of investment managers they work with; increased regulatory activity and scrutiny of many aspects of the asset management industry, including ESG practices and related matters, transparency/unbundling of fees, inducements, conflicts of interest, capital, liquidity, solvency, leverage, operational risk management, controls and compensation; addressing the key emerging markets in the world, such as China and India, which often have populations with different needs, preferences and horizons than the more developed U.S. and European markets; advances in technology and digital wealth and distribution tools and increasing client interest in interacting digitally with their investment portfolios; and growing crypto asset markets that remain subject to substantial volatility and significant regulatory uncertainty.
The asset management industry is facing transformative pressures and trends from a variety of different sources, including increased fee pressure; a continued shift away from actively managed fundamental equities and fixed income strategies towards alternatives, passive index and smart beta strategies; increased demands from clients and distributors for client engagement and services; a trend towards institutions concentrating on fewer relationships and partners and reducing the number of investment managers they work with; increased regulatory activity and scrutiny of many aspects of the asset management industry, including ESG practices and related matters, transparency/unbundling of fees, inducements, conflicts of interest, capital, liquidity, solvency, leverage, operational risk management, controls and compensation; addressing the key emerging markets in the world, such as China and India, which often have populations with different needs, preferences and horizons than the more developed U.S. and European markets; advances in technology and digital wealth and distribution tools and increasing client interest in interacting digitally with their investment portfolios; and growing crypto asset markets that remain subject to substantial volatility and significant regulatory uncertainty.
Our credit agreement imposes operating covenants that impact our ability to conduct certain activities and, if amounts borrowed under it were subject to accelerated repayment, we might not have sufficient assets or liquidity to repay such amounts in full. Our credit agreement requires us to maintain specified financial ratios, including maximum debt-to-earnings and minimum interest coverage ratios.
Our revolving credit agreement imposes operating covenants that impact our ability to conduct certain activities and, if amounts borrowed under it were subject to accelerated repayment, we might not have sufficient assets or liquidity to repay such amounts in full. Our revolving credit agreement requires us to maintain specified financial ratios, including maximum debt-to-earnings and minimum interest coverage ratios.
While we maintain controls to seek to prevent, detect and correct any errors, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. Any errors in the underlying models or model assumptions could have unanticipated and adverse consequences on our business and reputation.
While we maintain controls to seek to prevent, detect and correct any errors, even effective controls and procedures can only provide reasonable assurance of achieving their control objectives. Any errors in the underlying models or model assumptions could have unanticipated and adverse consequences on our business and reputation.
The credit agreement also contains customary affirmative operating covenants and negative covenants that, among other things, restrict certain of our subsidiaries' ability to incur debt and restrict our ability to transfer assets, merge, make loans and other investments and create liens. The breach of any covenant could result in a default under the credit agreement.
The revolving credit agreement also contains customary affirmative operating covenants and negative covenants that, among other things, restrict certain of our subsidiaries' ability to incur debt and restrict our ability to transfer assets, merge, make loans and other investments and create liens. The breach of any covenant could result in a default under the revolving credit agreement.
Moreover, certain legal or regulatory changes could require us to modify our strategies, businesses or operations, and we may incur other new constraints or costs, including the investment of significant management time and resources in order to satisfy new regulatory requirements or to compete in a changed business environment.
Moreover, certain legal or regulatory changes could require us to modify our strategies, businesses or operations, and we may incur other new constraints or costs, including the investment of significant management time and resources to satisfy new regulatory requirements or to compete in a changed business environment.
In the event of any such default, lenders that are party to the credit agreement could refuse to make further extensions of credit to us and require all amounts borrowed under the credit agreement, together with accrued interest and other fees, to be immediately due and payable.
In the event of any such default, lenders that are party to the revolving credit agreement could refuse to make further extensions of credit to us and require all amounts borrowed under the revolving credit agreement, together with accrued interest and other fees, to be immediately due and payable.
If any indebtedness under the credit agreement were subject to accelerated repayment and if we had at that time a significant amount of outstanding debt under the credit agreement, we might not have sufficient liquid assets to repay such indebtedness in full.
If any indebtedness under the revolving credit agreement were subject to accelerated repayment, and if we had at that time a significant amount of outstanding debt under the revolving credit agreement, we might not have sufficient liquid assets to repay such indebtedness in full.
Our credit agreement borrowing rates are tied to our credit ratings. A reduction in our long-term credit ratings could increase our borrowing costs, could limit our access to the capital markets and may result in outflows, thereby reducing AUM, revenues and net income.
Our revolving credit agreement borrowing rates are tied to our credit ratings. A reduction in our long-term credit ratings could increase our borrowing costs, could limit our access to the capital markets and may result in outflows, thereby reducing AUM, revenues and net income.
We cannot predict the full impact of legal and regulatory changes, changes in the interpretation of existing laws and regulations or possible enforcement proceedings on our business.
We cannot predict the full impact of legal and regulatory changes, changes in the interpretation of existing laws and regulations or possible enforcement actions or proceedings on our business.
Judgments in civil litigation or findings of wrongdoing by these authorities against us could affect our reputation, result in damages, fines or penalties for which we would be responsible, increase our costs of doing business and/or negatively impact our revenues, any of which could have a material negative impact on our AUM, revenues, net income or liquidity.
Judgments in civil litigation or findings of wrongdoing by these agencies or authorities against us could affect our reputation, result in damages, fines, penalties or sanctions for which we would be responsible, increase our costs of doing business and/or negatively impact our revenues, any of which could have a material negative impact on our AUM, revenues, net income or liquidity.
If we fail, or appear to fail, to address successfully and promptly the underlying causes of any poor investment performance, we may be unsuccessful in reversing such under performance, which could result in client loss or redemptions and the loss of future business prospects, both of which would negatively impact our revenues and net income.
If we fail, or appear to fail, to address successfully and promptly the underlying causes of any poor investment performance, we may be unsuccessful in reversing such underperformance, which could result in client loss or redemptions and the loss of future business prospects, both of which would negatively impact our revenues and net income.
Laws and regulations generally grant governmental agencies and industry self-regulatory authorities broad administrative discretion over our activities, including the power to require registration or licenses, limit or restrict our business activities, conduct examinations, risk assessments, investigations and capital adequacy reviews and impose remedial programs to address perceived deficiencies.
Laws and regulations generally grant governmental agencies and industry self-regulatory authorities broad administrative discretion over our activities, including the power to require registrations or licenses, limit or restrict our business activities, conduct examinations, risk assessments, investigations and capital adequacy reviews and impose remedial programs to address perceived deficiencies.
Volatility in global finance markets may also affect our ability to access the capital markets should we seek to do so. If we are unable to access capital markets in a timely manner, our business could be adversely affected. Insurance may not be available at a reasonable cost to protect us from loss or liability.
Volatility in global financing markets may also affect our ability to access the capital markets should we seek to do so. If we are unable to access capital markets in a timely manner, our business could be adversely affected. Insurance may not be available at a reasonable cost to protect us from loss or liability.
Our investment products, clients and us, to the extent of our investment in such investment products, could incur losses if the allowance for credit losses, including loan and lending-related commitment reserves, of portfolio-level investments is inadequate or if our expectations of future economic conditions deteriorate.
Our investment products, clients and, to the extent of our investment in such investment products, we could incur losses if the allowance for credit losses, including loan and lending-related commitment reserves, of portfolio-level investments is inadequate or if our expectations of future economic conditions deteriorate.
In addition, technology is subject to rapid advancements and changes and our competitors may, from time to time, implement newer technologies or more advanced platforms for their services and products, including digital advisers, low cost, high speed financial applications and services and investment platforms based on artificial intelligence and other advanced electronic systems, which could adversely affect our business if we are unable to remain competitive.
In addition, technology is subject to rapid advancements and changes and our competitors may, from time to time, implement newer technologies or more advanced platforms for their services and products, including digital advisers, low cost, high speed financial applications and services and investment platforms based on AI and other advanced electronic systems, which could adversely affect our business if we are unable to remain competitive.
Such changes have imposed, and are likely to continue to impose, new compliance costs and/or capital requirements or impact Invesco in other ways that could have a material adverse impact on our AUM, revenues, net income or liquidity.
Such changes have imposed, and are likely to continue to impose, new compliance costs and/or capital requirements or impact us in other ways that could have a material adverse impact on our AUM, revenues, net income or liquidity.
If we were to experience a man-made or natural disaster, health crisis or pandemic, such as new variant of COVID-19, or other business continuity problem, our continued success will depend, in part, on the availability of our personnel, our office facilities and the proper functioning of our computer, telecommunication and other related systems and operations.
If we were to experience a man-made or natural disaster, severe weather event, health crisis or pandemic, such as new variant of COVID-19, or other business continuity problem, our continued success will depend, in part, on the availability of our personnel, our office facilities and the proper functioning of our computer, telecommunication and other related systems and operations.
Certain institutional investors using money market products and other short-term duration fixed income products for cash management purposes may shift these investments to 10 Ta ble of Contents direct investments in comparable instruments in order to realize higher yields. These redemptions would reduce AUM, thereby reducing our revenues and net income.
Certain institutional investors using money market products and other short-term duration fixed income products for cash management purposes may shift these investments to direct investments in comparable instruments in order to realize higher yields. These redemptions would reduce AUM, thereby reducing our revenues and net 10 Table of Contents income.
Risks Related to Talent, Operations and Technology Our investment management professionals and other key employees are a vital part of our ability to attract and retain clients, and the loss of key individuals or a significant portion of those professionals could result in a reduction of our AUM, revenues and net income.
Risks Related to Human Capital, Operations and Technology Our investment management professionals and other key employees are a vital part of our ability to attract and retain clients, and the loss of key individuals or a significant portion of those professionals could result in a reduction of our AUM, revenues and net income.
These developments in the application of antitrust and competition laws to our business could impede our ability to provide certain products or limit the AUM of certain investment strategies that we provide. • Guidelines regarding the structure and components of fund manager compensation and other related rules, regulations and disclosure requirements.
Developments in these laws and regulations and their application to our business could impede our ability to provide certain products or limit the AUM of certain investment strategies that we provide. • Guidelines regarding the structure and components of fund manager compensation and other related rules, regulations and disclosure requirements.
The revenues and profitability of investment products, clients and us, to the extent of our investment in such investment products, are adversely affected when borrowers and counterparties default, in whole or in part, on their obligations or when there is a significant deterioration in the credit quality of the loan portfolio.
The revenues and profitability of investment products, clients and, to the extent of our investment in such investment products, us are adversely affected when borrowers and counterparties default, in whole or in part, on their obligations or when there is a significant deterioration in the credit quality of the loan portfolio or decline in the value of collateral.
If we are unable to successfully recover from a man-made or natural disaster, health crisis or pandemic or other business continuity problem, we could suffer material financial loss, loss of human capital, regulatory actions, reputational harm or legal liability.
If we are unable to successfully recover from a man-made or natural disaster, severe weather event, health crisis or pandemic or other business continuity problem, we could suffer material financial loss, loss of human capital, regulatory actions, reputational harm or legal liability.
If we are unable to adapt our strategy and business to adequately address 11 Ta ble of Contents these trends and pressures, we may be unable to satisfactorily meet client needs, our competitive position may weaken, and our AUM, revenues, and net income may be adversely affected.
If we are unable to adapt our strategy and business to adequately address 11 Table of Contents these trends and pressures, we may be unable to satisfactorily meet client needs, our competitive position may weaken, and our AUM, revenues, and net income may be adversely affected.
Our business also requires us to continuously manage actual and potential conflicts of interest, including situations where our services to a particular client conflict, or are perceived to conflict, with the interests of other clients or those of Invesco.
Our business also requires us to continuously manage actual and potential conflicts of interest, including situations where our services to a particular client conflict, or are perceived to conflict, with the interests of other clients or our own interests.
We recorded a non-cash impairment of $1,248.9 million related to our indefinite-live intangible assets related to acquired management contracts of U.S. retail mutual funds during the 12 months ended December 31, 2023, and we may not realize the full value of our remaining goodwill and indefinite-lived intangible assets.
We recorded a non-cash impairment of $1,248.9 million related to our indefinite-lived intangible assets related to acquired management contracts of U.S. retail mutual funds during the year ended December 31, 2023, and we may not realize the full value of our remaining goodwill and indefinite-lived intangible assets.
A substantial portion of the products and services we offer are regulated by the SEC, Financial Industry Regulatory Authority, the Commodity Future Trading Commission (CFTC), the National Futures Association, the Department of Labor (DOL) and the Texas Department of Banking in the U.S. and by the Financial Conduct Authority (FCA), and the Securities Futures Commission of Hong Kong (SFC) and the China Securities Regulatory Commission in Hong Kong and China, respectively.
A substantial portion of the products and services we offer in the U.S. are regulated by the SEC, Financial Industry Regulatory Authority, Commodity Futures Trading Commission, the National Futures Association, Department of Labor (DOL) and/or the Texas Department of Banking and in the U.K. are regulated by the Financial Conduct Authority (FCA), and in Hong Kong and China are regulated by the Securities Futures Commission of Hong Kong (SFC) and the China Securities Regulatory Commission, respectively.
As a result of regulatory oversight, we could face requirements or actions which negatively impact the way in which we conduct business, delay or deny approval for new products or service offerings, cause or contribute to reduced sales or increased redemptions of our products or services, impair the investment performance of other products or services, impact product mix, increase compliance costs and/or impose additional capital requirements.
As a result of regulatory oversight, we could face requirements, actions or proceedings that negatively impact the way in which we conduct business, delay or deny approval for new products or service offerings, cause or contribute to reduced sales of or increased redemptions of our existing products or services, impair the investment performance of certain of our products or services, impact our product mix, increase our compliance costs and/or impose additional capital requirements.
If a director or officer of a Bermuda company is found to have breached such director’s duties to that company, the director may be held personally liable to the company in respect of that breach of duty. 23 Ta ble of Contents Class actions and derivative actions are generally not available to shareholders under the laws of Bermuda.
If a director or officer of a Bermuda company is found to have breached such director’s duties to that company, the director may be held personally liable to the company in respect of that breach of duty. Class actions and derivative actions are generally not available to shareholders under the laws of Bermuda.
In recent years, certain regulatory developments have also added to downward pressures on our fee levels. Civil litigation and governmental investigations and enforcement actions could adversely affect our AUM and future net income and increase our costs of doing business.
In recent years, certain regulatory developments have also added to downward pressures on our fee levels. Civil litigation and governmental investigations and enforcement actions or proceedings against us could adversely affect our AUM and future net income and increase our costs of doing business.
Privacy regulations such as the General Data Protection Regulation (GDPR) in Europe have strengthened privacy rules for organizations handling personal data, granting individuals more rights and control over the use of their personal data, and greatly increasing penalties for non-compliance.
Privacy regulations such as the General Data Protection Regulation (GDPR) in Europe have strengthened privacy rules for organizations handling personal data, granted individuals more rights and control over the use of their personal data, and greatly increased penalties for non-compliance.
The failure or negative performance of products offered by competitors may have a negative impact on similar Invesco products irrespective of our performance. 13 Ta ble of Contents Many competitors offer similar products to those offered by us, and the failure or negative performance of competitors’ products could lead to a loss of confidence in similar Invesco products, irrespective of the performance of our products.
The failure or negative performance of products offered by competitors may have a negative impact on similar Invesco products irrespective of our performance. Many competitors offer similar products to those offered by us, and the failure or negative performance of competitors’ products could lead to a loss of confidence in similar Invesco products, irrespective of the performance of our products.
We face the inherent risk of loss or liability related to claims from clients, third-parties, actions taken by regulatory agencies and costs and losses associated with operations failures (which could include cyber incidents).
We face the inherent risk of loss or liability related to claims from clients, third-parties, actions taken by regulatory agencies and costs and losses associated with operations failures, including cyber incidents.
Our regulators likewise have the authority to commence enforcement actions which could lead to sanctions up to and including the revocation of licenses to operate certain businesses, the suspension or expulsion from a particular jurisdiction or market of any of our business organizations or their key personnel or the imposition of fines and censures on us or our employees.
Our regulators likewise have the authority to commence enforcement actions or proceedings that could lead to penalties and sanctions up to and including the revocation of registrations or licenses necessary to operate certain businesses, the suspension or expulsion from a particular jurisdiction or market of any of our business organizations or their key personnel or the imposition of fines and censures on us or our employees.
If the updated or new systems, such as our State Street Alpha platform, do not operate as anticipated or if other unforeseen issues arise with the transition to the new or updated systems it may adversely affect our business.
If the updated or new systems, such as our State Street Alpha platform, do not operate as anticipated or if other unforeseen issues arise with the transition to the new or updated systems, our business may be adversely affected.
As a result, our cash flow and ability to fund operations are dependent upon the earnings of our subsidiaries and the distribution of earnings, intercompany loans or other payments by our subsidiaries to us.
Substantially all of our operations are conducted through our subsidiaries. As a result, our cash flow and ability to fund operations are dependent upon the earnings of our subsidiaries and the distribution of earnings, intercompany loans or other payments by our subsidiaries to us.
Dollar relative to the United Kingdom (U.K.) Pound Sterling, Euro, Chinese RMB, Japanese Yen or Canadian Dollar, among other currencies, could have a material negative impact on our reported financial results.
Consequently, significant strengthening of the U.S. Dollar relative to the United Kingdom (U.K.) Pound Sterling, Euro, Chinese RMB, Japanese Yen or Canadian Dollar, among other currencies, could have a material negative impact on our reported financial results.
Regulators in the U.S., U.K. and EU have expressed concern that the daily redeemability features of these funds creates a “liquidity mismatch” with the assets in which they invest, which gives rise to investor dilution and systemic risk, especially in times of financial market stress.
Regulators in the U.S., U.K. and EU have expressed concern that the daily redeemability features of these funds may create a “liquidity mismatch” with the assets in which they invest, and that can give rise to investor dilution and systemic risk, especially in times of financial market stress.
In addition, transfers of cash between international jurisdictions may have adverse tax consequences. As of December 31, 2023, our minimum regulatory capital requirement was $395.8 million. Complying with our regulatory commitments may result in an increase in the capital requirements applicable to the European sub-group.
In addition, transfers of cash between international jurisdictions may have adverse tax consequences. As of December 31, 2024, our minimum regulatory capital requirement was $324.9 million. Complying with our regulatory commitments may result in an increase in the capital requirements applicable to the European sub-group.
Financial services institutions are interrelated as a result of trading, clearing, counterparty or other relationships. We, and the client portfolios that we manage, have exposure to many different industries and counterparties, and routinely execute transactions with counterparties in the financial services industry.
The lack of soundness of other financial institutions could adversely affect us or the client portfolios we manage. Financial services institutions are interrelated as a result of trading, clearing, counterparty or other relationships. We, and the client portfolios that we manage, have exposure to many different industries and counterparties, and routinely execute transactions with counterparties in the financial services industry.
We and certain related entities have in recent years been subject to various legal proceedings, including civil litigation and governmental investigations and enforcement actions. These actions can arise from normal business operations and/or matters that have been the subject of previous regulatory reviews.
We and certain of our subsidiaries have in recent years been subject to various legal proceedings, including civil litigation and governmental investigations and enforcement actions and proceedings. These actions can arise from normal business operations and/or matters that have been the subject of previous regulatory examinations.
Insurance costs are impacted by market conditions, claims made on policies and the risk profile of the insured and may increase significantly over relatively short periods. In addition, certain insurance coverage may not be available or may only be available at prohibitive costs.
Insurance costs are impacted by market 25 Table of Contents conditions, claims made on policies and our risk profile and may increase significantly over relatively short periods. In addition, certain insurance coverage may not be available or may only be available at prohibitive costs.
When our investment products or clients loan money, commit to loan money, provide credit or enter into a credit-related contract or mortgage loan with a counterparty, our investment products, client and us, to the extent of our investment in such investment products, incur credit risk, or the risk of loss if the borrower or counterparty does not timely repay their loans or fail to perform according to the terms of their agreements.
When our investment products or clients loan money, commit to loan money, provide credit or enter into a credit-related contract or mortgage loan with a counterparty, our investment products, clients and, to the extent of our investment in such investment products, we incur credit risk or the risk of loss if the borrower or counterparty does not timely repay its loans or fails to perform according to the terms of its agreement.
Further, regulators across borders could coordinate actions against us as issues arise resulting in impacts on our business in multiple jurisdictions. Judgments or findings of wrongdoing by regulatory or governmental authorities, or in private litigation against us, could affect our reputation, increase our costs of doing business and/or negatively impact our revenues.
Further, regulators across borders can coordinate actions against us as issues arise resulting in impacts on our business in multiple jurisdictions. Judgments or findings of wrongdoing or non-compliance with applicable law or regulation by governmental authorities, or in private civil litigation against us, could affect our reputation, increase our costs of doing business and/or negatively impact our revenues.
For example, governmental authorities regularly make inquiries, hold investigations and administer market conduct examinations with respect to the company's compliance with applicable laws and regulations. Lawsuits or regulatory enforcement actions arising out of these inquiries may in the future be filed against the company and related entities and individuals.
For example, governmental agencies and authorities regularly make inquiries, hold investigations and administer examinations with respect to the company's compliance with applicable laws and regulations. Lawsuits or regulatory enforcement actions arising out of these inquiries may in the future be filed against the company its subsidiaries and/or its employees.
In addition, we offer index tracking investment solutions for our passive products, and any errors or disruptions in our ability to accurately track a subject index could materially adversely affect our business or reputation, which would adversely affect our AUM, revenues, net income, and liquidity.
In addition, we offer index tracking investment solutions for our passive products, and any errors or disruptions in our ability to accurately track a subject index could materially adversely affect our business or reputation, which would adversely affect our AUM, revenues, net income, and liquidity. Disclosure requirements and expectations related to sustainability or ESG are increasing and evolving.
In the EU, the amendments to the undertakings for the collective investment in transferable securities (UCITS) and alternative investment fund managers directive frameworks have been agreed to and introduce new rules regarding the use of certain liquidity management tools (e.g., swing pricing, anti-dilution and side pockets etc.) by UCITS and alternative investment funds.
In the EU, recent amendments to the Undertakings for the Collective Investment in Transferable Securities (UCITS) and Alternative Investment Fund Managers (AIFMD) directive frameworks introduce new rules regarding the use of certain liquidity management tools (e.g., swing pricing and side pockets) by UCITS funds and AIFs.
In particular, the integration of sustainability risks, the disclosure of information on the ESG characteristics of EU products and the integration of investors’ ESG preferences at the point of sale have had a significant impact on the features of EU products and on investment management activities.
These regulations have materially impacted the asset management industry in the EU and U.K. In particular, the integration of sustainability risks, the disclosure of information on the ESG characteristics of EU products and the integration of investors’ ESG preferences at the point of sale have had a significant impact on the features of EU products and on investment management activities.
Our private market products include investments in private credit, real estate, and equity investments in early-stage real estate-related companies which may expose our investment products, clients and us, to the extent of our investment in such investment products, to risks and liabilities, and us to reputational harm.
Our private market products include investments in private credit, real estate, private market funds of funds and direct equity investments in operating companies that may expose our investment products, our clients and, to the extent of our investment in such investment products, us to risks and liabilities and reputational harm.
Significant errors by the company could impact our reputation, AUM, revenues, net income or liquidity. Our investment advisory agreements are subject to termination or non-renewal, and our fund and other investors may withdraw their assets at any time. 14 Ta ble of Contents Substantially all our revenues are derived from investment management agreements.
Significant errors by the company could impact our reputation, AUM, revenues, net income or liquidity. Our investment advisory agreements are subject to termination or non-renewal, and our fund and other investors may withdraw their assets at any time. Substantially all our revenues are derived from investment management agreements. Investment management agreements are generally terminable upon 30 or fewer days' notice.
Failure to obtain funds and/or financing, or any adverse change to the cost of obtaining such funds and/or financing, may cause our AUM, revenues and net income to decline, curtail our operations and limit or impede our prospects for growth.
Failure to obtain funds and/or financing, or any adverse change to the cost of obtaining such funds and/or financing, may cause our AUM, revenues and net income to decline, curtail our operations and limit or impede our prospects for growth. Distribution of earnings of our subsidiaries may be subject to limitations, including net capital requirements.
In addition, changes in individual and corporate income tax rates, including the capital gains and dividend tax rates, could cause investors to view certain investment products we manage less favorably and reduce investor demand for the products and services we offer, which could have an adverse effect on our AUM, revenues and net income.
In addition, changes in individual and corporate income tax rates, including the capital gains and dividend tax rates, could cause investors to view certain investment products we manage less favorably and reduce investor demand for the products and services we offer, which could have an adverse effect on our AUM, revenues and net income. 23 Table of Contents Examinations and audits by tax authorities could result in additional tax payments for prior periods.
Our private market products include investments in private credit, real estate, and equity investments in early-stage real estate-related companies that may expose our investment products, clients and us, to the extent of our investment in such investment products, to risks and liabilities that are inherent in the ownership, management and operation of such investments.
Our private market products include investments in private credit, real estate, private market funds of funds and direct equity investments in operating companies that may expose our investment products, our clients and, to the extent of our investment in such investment products, us to risks and liabilities that are inherent in the ownership, management and operation of such investments as well as reputational harm.
This issuance may limit our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes, may restrict our ability to pay dividends to holders of common shares in certain circumstances, may increase our vulnerability to general economic and industry conditions, and will require a significant portion of cash flow from operations to make required dividend payments to preferred shareholders.
This issuance may limit our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes, may restrict our ability to pay dividends to holders of common shares in certain circumstances, may increase our vulnerability to general economic and industry conditions, and will require a significant portion of cash flow from operations to make required dividend payments to preferred shareholders. 19 Table of Contents Failure to maintain adequate corporate and contingent liquidity may cause our AUM, revenues and net income to decline, as well as harm our prospects for growth.
We have goodwill and indefinite-lived intangible assets on our balance sheet that are subject to annual impairment reviews. We also have definite-lived intangible assets on our balance sheet that are subject to impairment testing. Goodwill and intangible assets totaled $8,691.5 million and $5,848.1 million, respectively, at December 31, 2023.
We also have definite-lived intangible assets on our balance sheet that are subject to impairment testing. Goodwill and intangible assets totaled $8,318.1 million and $5,749.3 million, respectively, at December 31, 2024.
The development and introduction of new products and services requires continued innovative efforts on our part and may require significant time and resources as well as ongoing support and investment.
Our financial performance depends, in part, on our ability to develop, market and manage new investment products and services. The development and introduction of new products and services requires continued innovative efforts on our part and may require significant time and resources as well as ongoing support and investment.
Our failure to properly perform and monitor our operations, including data management, or our otherwise suffering deficiencies and failures in these systems or service functions due to a failure of a third-party service provider or other key vendor could result in material financial loss or costs, regulatory actions, breach of client contracts, reputational harm or legal claims and liability, which in turn could have a negative effect on our AUM, revenues and net income. 17 Ta ble of Contents Risks Related to Accounting, Capital Management and Liquidity The carrying value of goodwill and other intangible assets on our balance sheet could become impaired, which would adversely affect our results of operations.
Our failure to properly perform and monitor our operations, including data management, or our otherwise suffering deficiencies and failures in these systems or service functions due to a failure of a third-party service provider or other key vendor could result in material financial loss or costs, regulatory actions, breach of client contracts, reputational harm or legal claims and liability, which in turn could have a negative effect on our AUM, revenues and net income.
New regulations in this area could negatively impact our existing products that employ leverage or derivatives and could impede our ability to bring new products to market and can raise our compliance costs associated with sponsoring and managing products that employ leverage or derivatives. • EU and U.K. regulations pertaining to integrating ESG topics.
New or further regulations in this area could negatively impact our existing products that employ leverage or derivatives, impede our ability to bring new products to market and raise our compliance costs associated with sponsoring and managing products that employ leverage or derivatives. • Regulations pertaining to the integration of ESG factors in asset management.
The rights of preferred shareholders may supersede the rights of common shareholders; • shareholders may only remove directors for “cause” (defined in our Bye-Laws to mean willful misconduct or gross negligence which is materially injurious to the company, fraud or embezzlement, or a conviction of, or a plea of “guilty” or “no contest” to, a felony); • our Board of Directors is authorized to expand its size and fill vacancies; and • shareholders cannot act by written consent unless the consent is unanimous. 24 Ta ble of Contents General Risk Factors Our ability to maintain our credit ratings and to access the capital markets in a timely manner should we seek to do so depends on a number of factors.
The rights of preferred shareholders may supersede the rights of common shareholders; • shareholders may only remove directors for “cause” (defined in our Bye-Laws to mean willful misconduct or gross negligence which is materially injurious to the company, fraud or embezzlement, or a conviction of, or a plea of “guilty” or “no contest” to, a felony); • our Board is authorized to expand its size and fill vacancies; and • shareholders cannot act by written consent unless the consent is unanimous.
Our ability to manage and grow our business successfully can be impeded by systems and other technological limitations. 16 Ta ble of Contents Our continued success in effectively managing and growing our business depends on our ability to integrate our varied accounting, financial, information and operational systems on a global basis.
Such consequences could have a negative effect on our AUM, revenues and net income. Our ability to manage and grow our business successfully can be impeded by systems and other technological limitations. Our continued success in effectively managing and growing our business depends on our ability to integrate our varied accounting, financial, information and operational systems on a global basis.
Failure to maintain adequate liquidity could lead to unanticipated costs and force us to revise existing strategic and business initiatives. Our access to equity and debt markets on reasonable terms may be limited by adverse market conditions, including tax and interest rates, a reduction in our long- or short-term credit ratings, or changes in government regulations.
Our access to equity and debt markets on reasonable terms may be limited by adverse market conditions, including tax and interest rates, a reduction in our long- or short-term credit ratings, or changes in government regulations.
Any damage to our reputation could impede our ability to attract and retain clients and key personnel, and lead to a reduction in the amount of our AUM, any of which could have a material adverse effect on our revenues, net income or liquidity. 15 Ta ble of Contents The lack of soundness of other financial institutions could adversely affect us or the client portfolios we manage.
Any damage to our reputation could impede our ability to attract and retain clients and key personnel, and lead to a reduction in the amount of our AUM, any of which could have a material adverse effect on our revenues, net income or liquidity.
Our status as a global financial institution and the nature of our client base may enhance the risk that we are targeted by such cyber threats.
Cyber security incidents and cyber-attacks have been occurring globally at a more frequent and severe level. Our status as a global financial institution and the nature of our client base may enhance the risk that we are targeted by such cyber threats.
We accrue tax liabilities for certain tax issues based on our estimate of whether, and the extent to which, additional taxes may be due. We adjust these liabilities periodically due to changes in interpretations of tax laws, status of tax authority examinations and new regulatory or judicial guidance that could impact the relative merits and risks of tax positions.
We adjust these liabilities periodically due to changes in interpretations of tax laws, status of tax authority examinations and new regulatory or judicial guidance that could impact the relative merits and risks of tax positions.
Although our estimates contemplate current conditions and how we expect them to change over the life of the investment portfolio, it is reasonably possible that actual conditions could be worse than anticipated, which could cause our revenues and net income to decline.
Although our estimates contemplate current conditions and how we expect them to change over the life of the investment portfolio, it is possible that actual conditions could be worse than anticipated, which could cause our revenues and net income to decline. 13 Table of Contents We may be unable to develop new products and services, and the development of new products and services may expose us to additional costs or operational risk.
As many of our subsidiary operations are located outside of the U.S. and have functional currencies other than the U.S. Dollar, changes in the exchange rates to the U.S. Dollar impact our reported financial results. The largest component of our net assets, revenues and expenses, as well as our AUM, is presently denominated in U.S. Dollars.
The largest component of our net assets, revenues and expenses, as well as our AUM, is presently denominated in U.S. Dollars. However, we have a large number of subsidiaries outside of the U.S. whose functional currencies are not the U.S. Dollar. As a result, fluctuations in the exchange rates to the U.S. Dollar impact our reported financial results.
In addition, if we sell substantial amounts of our common stock in the public market, or there is a perception that such sales may occur, the market price of our common stock could be negatively impacted.
In addition, if we sell substantial amounts of our common stock in the public market, or there is a perception that such sales may occur, the market price of our common stock could be negatively impacted. 20 Table of Contents MassMutual has the ability to significantly influence our business, and MassMutual’s interest in our business may be different from that of other shareholders.
Risks Related to Regulatory and Legal Matters We operate in an industry that is highly regulated in most countries, and any enforcement action or significant changes in the laws or regulations governing our business or industry could decrease our AUM, revenues, net income and liquidity. 19 Ta ble of Contents As with all investment management companies, our activities are highly regulated in almost every country in which we conduct business.
Risks Related to Regulatory and Legal Matters We operate in an industry that is highly regulated in most countries, and any enforcement action or proceeding against us or significant changes in the laws or regulations governing our business or industry could damage our reputation or decrease our AUM, revenues, net income and liquidity.
Any termination of or failure to renew a significant number of these agreements, or any other loss of a significant number of our clients or AUM, would adversely affect our revenues, net income, and liquidity.
Institutional clients may elect to terminate their relationships with us or reduce the aggregate amount of AUM, generally on short notice. Any termination of or failure to renew a significant number of these agreements, or any other loss of a significant number of our clients or AUM, would adversely affect our revenues, net income, and liquidity.
Additionally, we have investments in fixed income assets, including collateralized loan obligations (CLOs), real estate-related loans, commercial loans and seed capital in fixed income funds, the valuation of which could change with changes in interest and default rates.
Additionally, we have investments, including collateralized loan obligations (CLOs), real estate-related loans, commercial loans and seed capital in fixed income funds, the valuation of which could vary with changes in interest and default rates. Declines in the values of AUM could lead to reduced revenues and net income as management fees are generally calculated based upon the size of AUM.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe members of this Committee include the Chief Administrative Officer, Chief Risk and Audit Officer, General Counsel, Chief Financial Officer, Chief Human Resources Officer, Global Head of Compliance, and Global Operational Risk Owners which includes the GCSO. The Committee reports to the Enterprise Risk Management Committee which provides updates to the Board to facilitate their oversight.
Biggest changeThe members of this Committee include the Chief Information and Operations Officer, Chief Risk and Audit Officer, General Counsel, Chief Financial Officer, Chief Human Resources Officer, Global Head of Compliance, as well as other Global Operational Risk Owners which includes the GCSO.
Item 1C. Cybersecurity Cyber threats are considered one of the most significant risks facing financial institutions. To mitigate that risk, we have a designated Global Chief Security Officer (GCSO) who leads our Global Security Department that is responsible for identifying, assessing, and managing cybersecurity threats.
Item 1C. Cybersecurity Cyber threats are considered one of the most significant risks facing financial institutions. To mitigate that risk, we have a designated Global Chief Security Officer (GCSO) who leads our Global Security Department, which is responsible for identifying, assessing, and managing cybersecurity threats.
Important to these programs is our investment in threat-intelligence, our active engagement in industry and government security-related forums, and our utilization of external experts to challenge our program maturity, assess our controls and routinely test our capabilities. Our Board of Directors oversees cybersecurity risk and receives updates, at a minimum, twice a year regarding cybersecurity, including risks and protections.
Important to these programs is our investment in threat intelligence, our active engagement in industry and government security-related forums, and our utilization of external experts to challenge our program maturity, assess our controls and routinely test our capabilities. The company's Board oversees cybersecurity risk and receives updates, at a minimum, twice a year regarding cybersecurity, including risks and protections.
As of December 31, 2023, we have not experienced any cyber incidents that have materially affected or are reasonably likely to materially affect Invesco’s business strategy, results of operations or financial condition.
As of December 31, 2024, we have not experienced any cyber incidents that have materially affected or are reasonably likely to materially affect Invesco’s business strategy, results of operations or financial condition.
This subsidiary’s program aligns with all aspects of the company's information security program and is led by a dedicated CISO who reports to the Chief Operating Officer of the subsidiary and has comprehensive experience managing cybersecurity programs.
This subsidiary’s program aligns with all aspects of the company's information security program and is led by a dedicated CISO who reports to the Chief Operating Officer of the subsidiary and has comprehensive experience managing cybersecurity programs. The GCSO has indirect oversight of the subsidiary's CISO and its information security program.
The GCSO has indirect oversight of the subsidiary's CISO and its information security program. 25 Ta ble of Contents Our cybersecurity programs include the following: • Proactive assessments of technical infrastructure and security resilience are performed on a regular basis which include penetration testing, offensive testing and maturity assessments. • Conducting due diligence on third-party service providers regarding cybersecurity risks prior to on-boarding, periodic assessment of cybersecurity risks for third-party service providers and continuous monitoring for new third-party cybersecurity incidents. • An incident response program that includes periodic testing and is designed to restore business operations as quickly and as orderly as possible in the event of a cybersecurity incident at Invesco or a third-party. • Mandatory annual employee security awareness training, which focuses on cyber threats and security in general. • Regular cyber phishing tests throughout the year to measure and raise employee awareness against cyber phishing threats.
Our cybersecurity programs include the following: • Proactive assessments of technical infrastructure and security resilience are performed on a regular basis, which include penetration testing, offensive testing and maturity assessments. • Conducting due diligence on third-party service providers regarding cybersecurity risks prior to on-boarding, periodic assessment of cybersecurity risks for existing third-party service providers and continuous monitoring for new third-party cybersecurity incidents. • An incident response program that includes periodic testing and is designed to restore business operations as quickly and as orderly as possible in the event of a cybersecurity incident at Invesco or a third-party. • Mandatory annual employee security awareness training, which focuses on cyber threats and security in general. • Regular cyber phishing tests throughout the year to measure and raise employee awareness of cyber phishing threats.
Our GCSO has experience in the public and private sectors, specializing in security, investigations, and incident response. The Global Security Department oversees, among others, the following groups across Invesco: Information Security, Global Privacy, Business Continuity and Crisis Management, Resilience, and Corporate Security.
Our GCSO has experience in the public and private sectors, specializing in security, investigations, and incident response. The Global Security Department oversees, among others, the following groups across Invesco: Information Security, Strategic Intelligence, Corporate Security, Business Continuity, Crisis Management, Global Privacy Office, Business Security, Projects and Strategy.
This converged security structure supports a more comprehensive, holistic approach to keeping Invesco clients, employees, and critical assets safe, upholding privacy rights, while enabling a secure and resilient business.
This structure supports a more comprehensive, holistic approach to keeping our clients, employees, and critical assets safe, upholding privacy rights, and enabling a secure and resilient business.
For the subsidiary referenced above, an Enterprise Risk Management Steering Committee provides executive-level oversight and monitoring of its programs that manage information security and cyber related risk.
The Committee reports to the Enterprise Risk Management Committee, which provides updates to the Board to facilitate its oversight. For the subsidiary referenced above, an Enterprise Risk Management Steering Committee provides executive-level oversight and monitoring of its programs that manage information security and cyber related risk.
The members of this Enterprise Risk Management Steering Committee include the subsidiary’s Chief Executive Officer (CEO), Chief Operating Officer, Head of Risk, Head of Legal, Head of Privacy and the subsidiary’s CISO, as well as the company’s GCSO and CISO.
The members of this Enterprise Risk Management Steering Committee include the subsidiary’s Chief Executive Officer (CEO), Chief Operating Officer, Head of Risk, Head of Legal, 26 Table of Contents Head of Privacy and the subsidiary’s CISO, as well as the company’s GCSO and CISO. The subsidiary’s CISO provides updates to the Board to facilitate its oversight at least annually.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeSecurities Authorized for Issuance under Equity Compensation Plans The equity compensation plan information required in Item 201(d) of Regulation S-K is set forth in the definitive Proxy Statement for the company's annual meeting of shareholders, which will be filed with the SEC no later than 120 days after the close of the fiscal year ended December 31, 2023 and is incorporated by reference in this Report. 27 Ta ble of Contents Repurchases of Equity Securities The following table shows common share repurchase activity during the three months ended December 31, 2023: Month Total Number of Common Shares Purchased (1) Average Price Paid Per Common Share Total Number of Common Shares Purchased as Part of Publicly Announced Plans or Programs (2) Approximate Dollar Value of Common Shares that May Yet Be Purchased Under the Plans or Programs (2) (millions) October 1 - 31, 2023 126,856 $ 13.53 — $ 382.2 November 1 - 30, 2023 12,596 $ 13.84 — $ 382.2 December 1 - 31, 2023 11,872 $ 16.80 — $ 382.2 151,324 — ____________ (1) An aggregate of 151,324 common shares were surrendered to us by Invesco employees to satisfy tax withholding obligations in connection with the vesting of equity awards during the three months ended December 31, 2023.
Biggest changeSecurities Authorized for Issuance under Equity Compensation Plans The equity compensation plan information required in Item 201(d) of Regulation S-K is set forth in the definitive Proxy Statement for the company's annual meeting of shareholders, which will be filed with the SEC no later than 120 days after the close of the fiscal year ended December 31, 2024 and is incorporated by reference in this Report. 28 Table of Contents Repurchases of Equity Securities The following table shows common share repurchase activity during the three months ended December 31, 2024: Month Total Number of Common Shares Purchased (1) Average Price Paid Per Common Share Total Number of Common Shares Purchased as Part of Publicly Announced Plans or Programs (2) Approximate Dollar Value of Common Shares that May Yet Be Purchased Under the Plans or Programs (2) (millions) October 1 - 31, 2024 498,346 $ 17.81 482,194 $ 348.7 November 1 - 30, 2024 450,757 $ 17.82 438,237 $ 340.8 December 1 - 31, 2024 475,546 $ 17.89 458,622 $ 332.6 1,424,649 1,379,053 ____________ (1) An aggregate of 45,596 common shares were surrendered to us by Invesco employees to satisfy tax withholding obligations in connection with the vesting of equity awards during the three months ended December 31, 2024.
The following graph illustrates the cumulative total shareholder return of our common shares over the five-year period beginning from the market close on the last trading day of 2018 through and including the last trading day in the fiscal year ended December 31, 2023 and compares it to the cumulative total return of the Standard & Poor's (S&P) 500 Index and to a group of peer investment management companies.
The following graph illustrates the cumulative total shareholder return of our common shares over the five-year period beginning from the market close on the last trading day of 2019 through and including the last trading day in the fiscal year ended December 31, 2024 and compares it to the cumulative total return of the Standard & Poor's (S&P) 500 Index and to a group of peer investment management companies.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common shares are listed and traded on the NYSE under the symbol “IVZ.” At January 31, 2024, there were approximately 5,000 holders of record of our common shares.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common shares are listed and traded on the NYSE under the symbol “IVZ.” At January 31, 2025, there were approximately 4,800 holders of record of our common shares.
(2) At December 31, 2023, a balanc e of $382.2 million remains available under the common share repurchase authorization approved by the Board on July 22, 2016. 28 Ta ble of Contents Item 6. [Reserved]
(2) At December 31, 2024, a balanc e of $332.6 million remains available under the common share repurchase authorization approved by the Board on July 22, 2016. 29 Table of Contents Item 6. [Reserved]

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeForeign Exchange Rates During the year ended December 31, 2023, we experienced a decrease in AUM of $0.4 billion due to changes in foreign exchange rates (December 31, 2022: AUM decreased $26.1 billion; December 31, 2021: AUM decreased $6.3 billion). 34 Ta ble of Contents Total AUM by Channel (1) 2023 2022 2021 (in billions) Total Retail Institutional Total Retail Institutional Total Retail Institutional Beginning Assets (January 1) $ 1,409.2 $ 872.3 $ 536.9 $ 1,610.9 $ 1,106.5 $ 504.4 $ 1,349.9 $ 947.1 $ 402.8 Long-term inflows 299.1 219.9 79.2 330.3 243.9 86.4 426.8 301.2 125.6 Long-term outflows (288.9) (214.5) (74.4) (330.8) (257.5) (73.3) (345.4) (265.7) (79.7) Net long-term flows 10.2 5.4 4.8 (0.5) (13.6) 13.1 81.4 35.5 45.9 Net flows in non-management fee earning AUM 6.2 5.9 0.3 (3.2) 0.9 (4.1) 20.6 20.2 0.4 Net flows in money market funds (11.1) 1.4 (12.5) 56.4 1.8 54.6 39.7 3.3 36.4 Total net flows 5.3 12.7 (7.4) 52.7 (10.9) 63.6 141.7 59.0 82.7 Reinvested distributions 11.5 11.0 0.5 15.2 14.8 0.4 31.6 31.1 0.5 Market gains and losses 161.1 145.2 15.9 (243.5) (227.3) (16.2) 94.0 69.0 25.0 Dispositions (1.4) — (1.4) — — — — — — Foreign currency translation (0.4) 0.8 (1.2) (26.1) (10.8) (15.3) (6.3) 0.3 (6.6) Ending Assets (December 31) $ 1,585.3 $ 1,042.0 $ 543.3 $ 1,409.2 $ 872.3 $ 536.9 $ 1,610.9 $ 1,106.5 $ 504.4 Total AUM by Client Domicile (3) 2023 2022 2021 (in billions) Total Americas APAC EMEA Total Americas APAC EMEA Total Americas APAC EMEA Beginning Assets (January 1) $ 1,409.2 $ 999.4 $ 223.5 $ 186.3 $ 1,610.9 $ 1,132.5 $ 247.3 $ 231.1 $ 1,349.9 $ 959.9 $ 171.3 $ 218.7 Long-term inflows 299.1 154.0 77.1 68.0 330.3 184.0 76.6 69.7 426.8 213.2 139.0 74.6 Long-term outflows (288.9) (156.0) (67.0) (65.9) (330.8) (193.8) (62.5) (74.5) (345.4) (197.7) (71.8) (75.9) Net long-term flows 10.2 (2.0) 10.1 2.1 (0.5) (9.8) 14.1 (4.8) 81.4 15.5 67.2 (1.3) Net flows in non-management fee earning AUM 6.2 7.2 (0.3) (0.7) (3.2) (3.6) 1.1 (0.7) 20.6 15.9 2.4 2.3 Net flows in money market funds (11.1) (11.7) 1.3 (0.7) 56.4 58.3 (0.3) (1.6) 39.7 35.7 4.1 (0.1) Total net flows 5.3 (6.5) 11.1 0.7 52.7 44.9 14.9 (7.1) 141.7 67.1 73.7 0.9 Reinvested distributions 11.5 11.3 — 0.2 15.2 14.9 — 0.3 31.6 31.2 0.1 0.3 Market gains and losses 161.1 130.4 6.3 24.4 (243.5) (191.3) (22.6) (29.6) 94.0 74.4 5.9 13.7 Dispositions (1.4) (1.4) — — — — — — — — — — Foreign currency translation (0.4) 0.7 (5.4) 4.3 (26.1) (1.6) (16.1) (8.4) (6.3) (0.1) (3.7) (2.5) Ending Assets (December 31) $ 1,585.3 $ 1,133.9 $ 235.5 $ 215.9 $ 1,409.2 $ 999.4 $ 223.5 $ 186.3 $ 1,610.9 $ 1,132.5 $ 247.3 $ 231.1 ____________ See accompanying notes immediately following these AUM tables. 35 Ta ble of Contents Total AUM by Asset Class (2) (in billions) Total Equity Fixed Income Balanced Money Market Alternatives January 1, 2023 $ 1,409.2 $ 637.0 $ 313.7 $ 67.1 $ 203.5 $ 187.9 Long-term inflows 299.1 151.3 104.5 12.4 — 30.9 Long-term outflows (288.9) (128.9) (102.2) (17.7) — (40.1) Net long-term flows 10.2 22.4 2.3 (5.3) — (9.2) Net flows in non-management fee earning AUM 6.2 6.1 0.1 — — — Net flows in money market funds (11.1) — — — (11.1) — Total net flows 5.3 28.5 2.4 (5.3) (11.1) (9.2) Reinvested distributions 11.5 7.2 1.8 1.3 0.3 0.9 Market gains and losses 161.1 149.3 9.8 (0.1) 0.6 1.5 Dispositions (1.4) — — — — (1.4) Foreign currency translation (0.4) 1.7 (2.0) (0.3) (0.6) 0.8 December 31, 2023 $ 1,585.3 $ 823.7 $ 325.7 $ 62.7 $ 192.7 $ 180.5 Average AUM $ 1,500.6 $ 723.0 $ 318.4 $ 64.7 $ 212.0 $ 182.6 % of total average AUM 100.0 % 48.2 % 21.2 % 4.3 % 14.1 % 12.2 % January 1, 2022 $ 1,610.9 $ 841.6 $ 334.8 $ 88.6 $ 148.8 $ 197.1 Long-term inflows 330.3 143.7 119.3 15.2 — 52.1 Long-term outflows (330.8) (152.5) (102.4) (20.9) — (55.0) Net long-term flows (0.5) (8.8) 16.9 (5.7) — (2.9) Net flows in non-management fee earning AUM (3.2) 1.0 (4.2) — — — Net flows in money market funds 56.4 — — — 56.4 — Total net flows 52.7 (7.8) 12.7 (5.7) 56.4 (2.9) Reinvested distributions 15.2 11.1 1.6 1.2 — 1.3 Market gains and losses (243.5) (198.8) (27.3) (13.2) 1.1 (5.3) Dispositions — — — — — — Foreign currency translation (26.1) (9.1) (8.1) (3.8) (2.8) (2.3) December 31, 2022 $ 1,409.2 $ 637.0 $ 313.7 $ 67.1 $ 203.5 $ 187.9 Average AUM $ 1,452.5 $ 697.1 $ 315.1 $ 73.3 $ 167.6 $ 199.4 % of total average AUM 100.0 % 48.0 % 21.7 % 5.1 % 11.5 % 13.7 % January 1, 2021 $ 1,349.9 $ 689.6 $ 296.4 $ 78.9 $ 108.5 $ 176.5 Long-term inflows 426.8 205.0 118.1 48.5 — 55.2 Long-term outflows (345.4) (182.1) (76.8) (40.8) — (45.7) Net long-term flows 81.4 22.9 41.3 7.7 — 9.5 Net flows in non-management fee earning AUM 20.6 20.6 — — — — Net flows in money market funds 39.7 — — — 39.7 — Total net flows 141.7 43.5 41.3 7.7 39.7 9.5 Reinvested distributions 31.6 25.4 1.9 2.7 — 1.6 Market gains and losses 94.0 85.9 (2.0) (1.1) — 11.2 Dispositions — — — — — — Foreign currency translation (6.3) (2.8) (2.8) 0.4 0.6 (1.7) December 31, 2021 $ 1,610.9 $ 841.6 $ 334.8 $ 88.6 $ 148.8 $ 197.1 Average AUM $ 1,499.9 $ 778.3 $ 316.1 $ 86.5 $ 131.1 $ 187.9 % of total average AUM 100.0 % 51.9 % 21.1 % 5.8 % 8.7 % 12.5 % ____________ See accompanying notes immediately following these AUM tables. 36 Ta ble of Contents Active AUM by Channel (1) 2023 2022 2021 (in billions) Total Retail Institutional Total Retail Institutional Total Retail Institutional Beginning Assets (January 1) $ 976.2 $ 482.1 $ 494.1 $ 1,082.5 $ 631.7 $ 450.8 $ 979.3 $ 601.1 $ 378.2 Long-term inflows 164.3 98.8 65.5 197.9 117.0 80.9 260.2 163.5 96.7 Long-term outflows (193.3) (126.0) (67.3) (226.2) (157.5) (68.7) (242.0) (167.9) (74.1) Net long-term flows (29.0) (27.2) (1.8) (28.3) (40.5) 12.2 18.2 (4.4) 22.6 Net flows in non-management fee earning AUM — 0.1 (0.1) — — — (0.1) (0.1) — Net flows in money market funds (11.1) 1.4 (12.5) 56.4 1.8 54.6 39.7 3.3 36.4 Total net flows (40.1) (25.7) (14.4) 28.1 (38.7) 66.8 57.8 (1.2) 59.0 Reinvested distributions 11.5 11.0 0.5 15.2 14.8 0.4 31.6 31.1 0.5 Market gains and losses 40.0 33.7 6.3 (125.6) (115.6) (10.0) 18.3 (0.1) 18.4 Dispositions (1.4) — (1.4) — — — — — — Foreign currency translation (0.9) 0.4 (1.3) (24.0) (10.1) (13.9) (4.5) 0.8 (5.3) Ending Assets (December 31) $ 985.3 $ 501.5 $ 483.8 $ 976.2 $ 482.1 $ 494.1 $ 1,082.5 $ 631.7 $ 450.8 Active AUM by Client Domicile (3) 2023 2022 2021 (in billions) Total Americas APAC EMEA Total Americas APAC EMEA Total Americas APAC EMEA Beginning Assets (January 1) $ 976.2 $ 670.8 $ 191.0 $ 114.4 $ 1,082.5 $ 724.5 $ 208.8 $ 149.2 $ 979.3 $ 656.9 $ 163.4 $ 159.0 Long-term inflows 164.3 78.0 61.1 25.2 197.9 104.0 69.3 24.6 260.2 113.6 110.5 36.1 Long-term outflows (193.3) (109.7) (55.0) (28.6) (226.2) (133.4) (56.1) (36.7) (242.0) (125.4) (67.4) (49.2) Net long-term flows (29.0) (31.7) 6.1 (3.4) (28.3) (29.4) 13.2 (12.1) 18.2 (11.8) 43.1 (13.1) Net flows in non-management fee earning AUM — — — — — — 0.1 (0.1) (0.1) (0.2) 0.1 — Net flows in money market funds (11.1) (11.7) 1.3 (0.7) 56.4 58.3 (0.3) (1.6) 39.7 35.7 4.1 (0.1) Total net flows (40.1) (43.4) 7.4 (4.1) 28.1 28.9 13.0 (13.8) 57.8 23.7 47.3 (13.2) Reinvested distributions 11.5 11.3 — 0.2 15.2 14.9 — 0.3 31.6 31.2 0.1 0.3 Market gains and losses 40.0 33.4 (1.0) 7.6 (125.6) (96.0) (16.3) (13.3) 18.3 12.8 0.3 5.2 Dispositions (1.4) (1.4) — — — — — — — — — — Foreign currency translation (0.9) 0.7 (5.4) 3.8 (24.0) (1.5) (14.5) (8.0) (4.5) (0.1) (2.3) (2.1) Ending Assets (December 31) $ 985.3 $ 671.4 $ 192.0 $ 121.9 $ 976.2 $ 670.8 $ 191.0 $ 114.4 $ 1,082.5 $ 724.5 $ 208.8 $ 149.2 ____________ See accompanying notes immediately following these AUM tables. 37 Ta ble of Contents Active AUM by Asset Class (2) (in billions) Total Equity Fixed Income Balanced Money Market Alternatives January 1, 2023 $ 976.2 $ 277.5 $ 273.0 $ 66.3 $ 203.5 $ 155.9 Long-term inflows 164.3 49.3 85.0 12.3 — 17.7 Long-term outflows (193.3) (64.5) (85.3) (17.6) — (25.9) Net long-term flows (29.0) (15.2) (0.3) (5.3) — (8.2) Net flows in money market funds (11.1) — — — (11.1) — Total net flows (40.1) (15.2) (0.3) (5.3) (11.1) (8.2) Reinvested distributions 11.5 7.2 1.8 1.3 0.3 0.9 Market gains and losses 40.0 31.9 7.8 (0.2) 0.6 (0.1) Dispositions (1.4) — — — — (1.4) Foreign currency translation (0.9) 1.5 (2.3) (0.3) (0.6) 0.8 December 31, 2023 $ 985.3 $ 302.9 $ 280.0 $ 61.8 $ 192.7 $ 147.9 Average AUM $ 992.3 $ 291.6 $ 273.1 $ 63.9 $ 212.0 $ 151.8 % of total average AUM 100.0 % 29.4 % 27.5 % 6.4 % 21.4 % 15.3 % January 1, 2022 $ 1,082.5 $ 389.6 $ 293.1 $ 87.4 $ 148.8 $ 163.6 Long-term inflows 197.9 54.2 98.1 15.2 — 30.4 Long-term outflows (226.2) (83.3) (89.7) (20.8) — (32.4) Net long-term flows (28.3) (29.1) 8.4 (5.6) — (2.0) Net flows in money market funds 56.4 — — — 56.4 — Total net flows 28.1 (29.1) 8.4 (5.6) 56.4 (2.0) Reinvested distributions 15.2 11.1 1.6 1.2 — 1.3 Market gains and losses (125.6) (86.4) (22.4) (12.9) 1.1 (5.0) Dispositions — — — — — — Foreign currency translation (24.0) (7.7) (7.7) (3.8) (2.8) (2.0) December 31, 2022 $ 976.2 $ 277.5 $ 273.0 $ 66.3 $ 203.5 $ 155.9 Average AUM $ 988.2 $ 309.6 $ 275.2 $ 72.3 $ 167.5 $ 163.6 % of total average AUM 100.0 % 31.3 % 27.8 % 7.3 % 17.0 % 16.6 % January 1, 2021 $ 979.3 $ 383.2 $ 259.4 $ 77.9 $ 108.5 $ 150.3 Long-term inflows 260.2 70.9 103.5 48.3 — 37.5 Long-term outflows (242.0) (98.9) (67.9) (40.8) — (34.4) Net long-term flows 18.2 (28.0) 35.6 7.5 — 3.1 Net flows in non-management fee earning AUM (0.1) (0.1) (0.1) 0.1 — — Net flows in money market funds 39.7 — — — 39.7 — Total net flows 57.8 (28.1) 35.5 7.6 39.7 3.1 Reinvested distributions 31.6 25.4 1.9 2.7 — 1.6 Market gains and losses 18.3 10.8 (1.3) (1.2) — 10.0 Dispositions — — — — — — Foreign currency translation (4.5) (1.7) (2.4) 0.4 0.6 (1.4) December 31, 2021 $ 1,082.5 $ 389.6 $ 293.1 $ 87.4 $ 148.8 $ 163.6 Average AUM $ 1,050.2 $ 401.5 $ 275.0 $ 85.4 $ 131.1 $ 157.2 % of total average AUM 100.0 % 38.2 % 26.2 % 8.1 % 12.5 % 15.0 % ____________ See accompanying notes immediately following these AUM tables. 38 Ta ble of Contents Passive AUM by Channel (1) 2023 2022 2021 (in billions) Total Retail Institutional Total Retail Institutional Total Retail Institutional Beginning Assets (January 1) $ 433.0 $ 390.2 $ 42.8 $ 528.4 $ 474.8 $ 53.6 $ 370.6 $ 346.0 $ 24.6 Long-term inflows 134.8 121.1 13.7 132.4 126.9 5.5 166.6 137.7 28.9 Long-term outflows (95.6) (88.5) (7.1) (104.6) (100.0) (4.6) (103.4) (97.8) (5.6) Net long-term flows 39.2 32.6 6.6 27.8 26.9 0.9 63.2 39.9 23.3 Net flows in non-management fee earning AUM 6.2 5.8 0.4 (3.2) 0.9 (4.1) 20.7 20.3 0.4 Total net flows 45.4 38.4 7.0 24.6 27.8 (3.2) 83.9 60.2 23.7 Market gains and losses 121.1 111.5 9.6 (117.9) (111.7) (6.2) 75.7 69.1 6.6 Foreign currency translation 0.5 0.4 0.1 (2.1) (0.7) (1.4) (1.8) (0.5) (1.3) Ending Assets (December 31) $ 600.0 $ 540.5 $ 59.5 $ 433.0 $ 390.2 $ 42.8 $ 528.4 $ 474.8 $ 53.6 Passive AUM by Client Domicile (3) 2023 2022 2021 (in billions) Total Americas APAC EMEA Total Americas APAC EMEA (4) Total Americas APAC EMEA Beginning Assets (January 1) $ 433.0 $ 328.6 $ 32.5 $ 71.9 $ 528.4 $ 408.0 $ 38.5 $ 81.9 $ 370.6 $ 303.0 $ 7.9 $ 59.7 Long-term inflows 134.8 76.0 16.0 42.8 132.4 80.0 7.3 45.1 166.6 99.6 28.5 38.5 Long-term outflows (95.6) (46.3) (12.0) (37.3) (104.6) (60.4) (6.4) (37.8) (103.4) (72.3) (4.4) (26.7) Net long-term flows 39.2 29.7 4.0 5.5 27.8 19.6 0.9 7.3 63.2 27.3 24.1 11.8 Net flows in non-management fee earning AUM 6.2 7.2 (0.3) (0.7) (3.2) (3.6) 1.0 (0.6) 20.7 16.1 2.3 2.3 Total net flows 45.4 36.9 3.7 4.8 24.6 16.0 1.9 6.7 83.9 43.4 26.4 14.1 Market gains and losses 121.1 97.0 7.3 16.8 (117.9) (95.3) (6.3) (16.3) 75.7 61.6 5.6 8.5 Foreign currency translation 0.5 — — 0.5 (2.1) (0.1) (1.6) (0.4) (1.8) — (1.4) (0.4) Ending Assets (December 31) $ 600.0 $ 462.5 $ 43.5 $ 94.0 $ 433.0 $ 328.6 $ 32.5 $ 71.9 $ 528.4 $ 408.0 $ 38.5 $ 81.9 ____________ See accompanying notes immediately following these AUM tables. 39 Ta ble of Contents Passive AUM by Asset Class (2) (in billions) Total Equity Fixed Income Balanced Money Market Alternatives January 1, 2023 $ 433.0 $ 359.5 $ 40.7 $ 0.8 $ — $ 32.0 Long-term inflows 134.8 102.0 19.5 0.1 — 13.2 Long-term outflows (95.6) (64.4) (16.9) (0.1) — (14.2) Net long-term flows 39.2 37.6 2.6 — — (1.0) Net flows in non-management fee earning AUM 6.2 6.1 0.1 — — — Total net flows 45.4 43.7 2.7 — — (1.0) Market gains and losses 121.1 117.4 2.0 0.1 — 1.6 Foreign currency translation 0.5 0.2 0.3 — — — December 31, 2023 $ 600.0 $ 520.8 $ 45.7 $ 0.9 $ — $ 32.6 Average AUM $ 508.3 $ 431.4 $ 45.3 $ 0.8 $ — $ 30.8 % of total average AUM 100.0 % 84.8 % 8.9 % 0.2 % — % 6.1 % January 1, 2022 $ 528.4 $ 452.0 $ 41.7 $ 1.2 $ — $ 33.5 Long-term inflows 132.4 89.5 21.2 — — 21.7 Long-term outflows (104.6) (69.2) (12.7) (0.1) — (22.6) Net long-term flows 27.8 20.3 8.5 (0.1) — (0.9) Net flows in non-management fee earning AUM (3.2) 1.0 (4.2) — — — Total net flows 24.6 21.3 4.3 (0.1) — (0.9) Market gains and losses (117.9) (112.4) (4.9) (0.3) — (0.3) Foreign currency translation (2.1) (1.4) (0.4) — — (0.3) December 31, 2022 $ 433.0 $ 359.5 $ 40.7 $ 0.8 $ — $ 32.0 Average AUM $ 464.3 $ 387.6 $ 39.9 $ 0.9 $ — $ 35.9 % of total average AUM 100.0 % 83.5 % 8.6 % 0.2 % — % 7.7 % January 1, 2021 $ 370.6 $ 306.4 $ 37.0 $ 1.0 $ — $ 26.2 Long-term inflows 166.6 134.1 14.6 0.2 — 17.7 Long-term outflows (103.4) (83.2) (8.9) — — (11.3) Net long-term flows 63.2 50.9 5.7 0.2 — 6.4 Net flows in non-management fee earning AUM 20.7 20.7 0.1 (0.1) — — Total net flows 83.9 71.6 5.8 0.1 — 6.4 Market gains and losses 75.7 75.1 (0.7) 0.1 — 1.2 Foreign currency translation (1.8) (1.1) (0.4) — — (0.3) December 31, 2021 $ 528.4 $ 452.0 $ 41.7 $ 1.2 $ — $ 33.5 Average AUM $ 449.7 $ 376.8 $ 41.1 $ 1.1 $ — $ 30.7 % of total average AUM 100.0 % 83.8 % 9.2 % 0.2 % — % 6.8 % ____________ See accompanying notes immediately following these AUM tables.
Biggest changeForeign Exchange Rates During the year ended December 31, 2024, we experienced a decrease in AUM of $16.3 billion due to changes in foreign exchange rates (December 31, 2023: AUM decreased $0.4 billion; December 31, 2022: AUM decreased $26.1 billion). 35 Table of Contents Total AUM by Channel (1) 2024 2023 2022 (in billions) Total Retail Institutional Total Retail Institutional Total Retail Institutional Beginning Assets (January 1) $ 1,585.3 $ 1,042.0 $ 543.3 $ 1,409.2 $ 872.3 $ 536.9 $ 1,610.9 $ 1,106.5 $ 504.4 Long-term inflows 419.0 319.6 99.4 299.1 219.9 79.2 330.3 243.9 86.4 Long-term outflows (353.9) (259.6) (94.3) (288.9) (214.5) (74.4) (330.8) (257.5) (73.3) Net long-term flows 65.1 60.0 5.1 10.2 5.4 4.8 (0.5) (13.6) 13.1 Net flows in non-management fee earning AUM 29.8 28.7 1.1 6.2 5.9 0.3 (3.2) 0.9 (4.1) Net flows in money market funds 23.4 1.5 21.9 (11.1) 1.4 (12.5) 56.4 1.8 54.6 Total net flows 118.3 90.2 28.1 5.3 12.7 (7.4) 52.7 (10.9) 63.6 Reinvested distributions 16.0 15.8 0.2 11.5 11.0 0.5 15.2 14.8 0.4 Market gains and losses 142.7 123.4 19.3 161.1 145.2 15.9 (243.5) (227.3) (16.2) Dispositions — — — (1.4) — (1.4) — — — Foreign currency translation (16.3) (5.8) (10.5) (0.4) 0.8 (1.2) (26.1) (10.8) (15.3) Ending Assets (December 31) $ 1,846.0 $ 1,265.6 $ 580.4 $ 1,585.3 $ 1,042.0 $ 543.3 $ 1,409.2 $ 872.3 $ 536.9 Total AUM by Client Domicile (2) 2024 2023 2022 (in billions) Total Americas APAC EMEA Total Americas APAC EMEA Total Americas APAC EMEA Beginning Assets (January 1) $ 1,585.3 $ 1,133.9 $ 235.5 $ 215.9 $ 1,409.2 $ 999.4 $ 223.5 $ 186.3 $ 1,610.9 $ 1,132.5 $ 247.3 $ 231.1 Long-term inflows 419.0 212.5 121.0 85.5 299.1 154.0 77.1 68.0 330.3 184.0 76.6 69.7 Long-term outflows (353.9) (190.7) (94.9) (68.3) (288.9) (156.0) (67.0) (65.9) (330.8) (193.8) (62.5) (74.5) Net long-term flows 65.1 21.8 26.1 17.2 10.2 (2.0) 10.1 2.1 (0.5) (9.8) 14.1 (4.8) Net flows in non-management fee earning AUM 29.8 23.8 0.1 5.9 6.2 7.2 (0.3) (0.7) (3.2) (3.6) 1.1 (0.7) Net flows in money market funds 23.4 24.0 — (0.6) (11.1) (11.7) 1.3 (0.7) 56.4 58.3 (0.3) (1.6) Total net flows 118.3 69.6 26.2 22.5 5.3 (6.5) 11.1 0.7 52.7 44.9 14.9 (7.1) Reinvested distributions 16.0 15.8 — 0.2 11.5 11.3 — 0.2 15.2 14.9 — 0.3 Market gains and losses 142.7 101.5 16.3 24.9 161.1 130.4 6.3 24.4 (243.5) (191.3) (22.6) (29.6) Transfer — (3.4) 3.6 (0.2) — — — — — — — — Dispositions — — — — (1.4) (1.4) — — — — — — Foreign currency translation (16.3) (1.9) (11.4) (3.0) (0.4) 0.7 (5.4) 4.3 (26.1) (1.6) (16.1) (8.4) Ending Assets (December 31) $ 1,846.0 $ 1,315.5 $ 270.2 $ 260.3 $ 1,585.3 $ 1,133.9 $ 235.5 $ 215.9 $ 1,409.2 $ 999.4 $ 223.5 $ 186.3 ____________ See accompanying notes immediately following these AUM tables. 36 Table of Contents Total AUM by Investment Capability (3) Twelve months ended December 31, 2024 (in billions) Total ETFs and Index (4) Fundamental Fixed Income (5) Fundamental Equities (6) Private Markets (7) APAC Managed (8) Multi-Asset/ Other (9) Global Liquidity (10) QQQ (11) Beginning Assets (January 1) $ 1,585.3 $ 362.1 $ 272.6 $ 260.5 $ 129.7 $ 108.0 $ 57.4 $ 165.0 $ 230.0 Long-term inflows 419.0 192.7 68.5 35.7 25.0 86.7 10.4 — — Long-term outflows (353.9) (121.4) (60.7) (59.9) (20.9) (78.1) (12.9) — — Net long-term flows 65.1 71.3 7.8 (24.2) 4.1 8.6 (2.5) — — Net flows in non-management fee earning AUM 29.8 — — — — — 0.7 — 29.1 Net flows in money market funds 23.4 — — — — (0.2) — 23.6 — Total net flows 118.3 71.3 7.8 (24.2) 4.1 8.4 (1.8) 23.6 29.1 Reinvested distributions 16.0 0.5 2.1 11.6 0.8 — 0.6 0.4 — Market gains and losses 142.7 53.2 3.2 21.2 (4.6) 5.6 3.8 0.5 59.8 Foreign currency translation (16.3) (3.1) (4.6) (2.6) (1.5) (3.2) (1.2) (0.1) — Ending Assets (December 31) $ 1,846.0 $ 484.0 $ 281.1 $ 266.5 $ 128.5 $ 118.8 $ 58.8 $ 189.4 $ 318.9 Average AUM $ 1,712.2 $ 423.8 $ 276.9 $ 269.4 $ 128.5 $ 112.1 $ 59.8 $ 165.9 $ 275.8 Twelve months ended December 31, 2023 Beginning Assets (January 1) $ 1,409.2 $ 285.6 $ 261.3 $ 238.8 $ 129.9 $ 113.6 $ 57.7 $ 176.4 $ 145.9 Long-term inflows 299.1 124.1 60.6 36.7 16.1 52.5 9.1 — — Long-term outflows (288.9) (90.8) (59.6) (54.3) (15.5) (55.1) (13.6) — — Net long-term flows 10.2 33.3 1.0 (17.6) 0.6 (2.6) (4.5) — — Net flows in non-management fee earning AUM 6.2 — — — — — (0.3) — 6.5 Net flows in money market funds (11.1) — — — — 1.2 — (12.3) — Total net flows 5.3 33.3 1.0 (17.6) 0.6 (1.4) (4.8) (12.3) 6.5 Reinvested distributions 11.5 0.3 1.9 7.8 0.8 — 0.4 0.3 — Market gains and losses 161.1 42.5 9.4 29.9 (0.9) (1.1) 3.2 0.5 77.6 Dispositions (1.4) — — — (1.4) — — — — Foreign currency translation (0.4) 0.4 (1.0) 1.6 0.7 (3.1) 0.9 0.1 — Ending Assets (December 31) $ 1,585.3 $ 362.1 $ 272.6 $ 260.5 $ 129.7 $ 108.0 $ 57.4 $ 165.0 $ 230.0 Average AUM $ 1,500.6 $ 316.7 $ 264.5 $ 249.9 $ 128.2 $ 111.0 $ 59.7 $ 183.1 $ 187.5 ___________ See accompanying notes immediately following these AUM tables. 37 Table of Contents Twelve months ended December 31, 2022 (in billions) Total ETFs and Index (4) Fundamental Fixed Income (5) Fundamental Equities (6) Private Markets (7) APAC Managed (8) Multi-Asset/ Other (9) Global Liquidity (10) QQQ (11) Beginning Assets (January 1) $ 1,610.9 $ 303.5 $ 288.5 $ 343.5 $ 134.4 $ 127.9 $ 78.9 $ 119.1 $ 215.1 Long-term inflows 330.3 131.9 70.8 40.4 25.2 53.4 8.6 — — Long-term outflows (330.8) (101.2) (68.6) (70.9) (27.7) (46.7) (15.7) — — Net long-term flows (0.5) 30.7 2.2 (30.5) (2.5) 6.7 (7.1) — — Net flows in non-management fee earning AUM (3.2) — — — — — (4.5) — 1.3 Net flows in money market funds 56.4 — — — — (0.2) — 56.6 — Total net flows 52.7 30.7 2.2 (30.5) (2.5) 6.5 (11.6) 56.6 1.3 Reinvested distributions 15.2 0.5 1.7 11.4 1.0 — 0.6 — — Market gains and losses (243.5) (47.3) (25.1) (81.4) (1.3) (11.3) (7.6) 1.0 (70.5) Foreign currency translation (26.1) (1.8) (6.0) (4.2) (1.7) (9.5) (2.6) (0.3) — Ending Assets (December 31) $ 1,409.2 $ 285.6 $ 261.3 $ 238.8 $ 129.9 $ 113.6 $ 57.7 $ 176.4 $ 145.9 Average AUM $ 1,452.5 $ 293.5 $ 264.5 $ 270.5 $ 134.1 $ 117.8 $ 64.9 $ 138.1 $ 169.1 ____________ See accompanying notes immediately following these AUM tables. 38 Table of Contents Active AUM by Channel (1) 2024 2023 2022 (in billions) Total Retail Institutional Total Retail Institutional Total Retail Institutional Beginning Assets (January 1) $ 985.3 $ 501.5 $ 483.8 $ 976.2 $ 482.1 $ 494.1 $ 1,082.5 $ 631.7 $ 450.8 Long-term inflows 194.0 109.6 84.4 164.3 98.8 65.5 197.9 117.0 80.9 Long-term outflows (209.4) (128.8) (80.6) (193.3) (126.0) (67.3) (226.2) (157.5) (68.7) Net long-term flows (15.4) (19.2) 3.8 (29.0) (27.2) (1.8) (28.3) (40.5) 12.2 Net flows in non-management fee earning AUM — — — — 0.1 (0.1) — — — Net flows in money market funds 23.4 1.5 21.9 (11.1) 1.4 (12.5) 56.4 1.8 54.6 Total net flows 8.0 (17.7) 25.7 (40.1) (25.7) (14.4) 28.1 (38.7) 66.8 Reinvested distributions 16.0 15.8 0.2 11.5 11.0 0.5 15.2 14.8 0.4 Market gains and losses 30.0 22.4 7.6 40.0 33.7 6.3 (125.6) (115.6) (10.0) Dispositions — — — (1.4) — (1.4) — — — Foreign currency translation (12.8) (4.5) (8.3) (0.9) 0.4 (1.3) (24.0) (10.1) (13.9) Ending Assets (December 31) $ 1,026.5 $ 517.5 $ 509.0 $ 985.3 $ 501.5 $ 483.8 $ 976.2 $ 482.1 $ 494.1 Active AUM by Client Domicile (2) 2024 2023 2022 (in billions) Total Americas APAC EMEA Total Americas APAC EMEA Total Americas APAC EMEA Beginning Assets (January 1) $ 985.3 $ 671.4 $ 192.0 $ 121.9 $ 976.2 $ 670.8 $ 191.0 $ 114.4 $ 1,082.5 $ 724.5 $ 208.8 $ 149.2 Long-term inflows 194.0 84.1 84.7 25.2 164.3 78.0 61.1 25.2 197.9 104.0 69.3 24.6 Long-term outflows (209.4) (111.8) (70.2) (27.4) (193.3) (109.7) (55.0) (28.6) (226.2) (133.4) (56.1) (36.7) Net long-term flows (15.4) (27.7) 14.5 (2.2) (29.0) (31.7) 6.1 (3.4) (28.3) (29.4) 13.2 (12.1) Net flows in non-management fee earning AUM — — — — — — — — — — 0.1 (0.1) Net flows in money market funds 23.4 24.0 — (0.6) (11.1) (11.7) 1.3 (0.7) 56.4 58.3 (0.3) (1.6) Total net flows 8.0 (3.7) 14.5 (2.8) (40.1) (43.4) 7.4 (4.1) 28.1 28.9 13.0 (13.8) Reinvested distributions 16.0 15.8 — 0.2 11.5 11.3 — 0.2 15.2 14.9 — 0.3 Market gains and losses 30.0 19.7 6.2 4.1 40.0 33.4 (1.0) 7.6 (125.6) (96.0) (16.3) (13.3) Transfer — (3.4) 3.6 (0.2) — — — — — — — — Dispositions — — — — (1.4) (1.4) — — — — — — Foreign currency translation (12.8) (1.6) (8.9) (2.3) (0.9) 0.7 (5.4) 3.8 (24.0) (1.5) (14.5) (8.0) Ending Assets (December 31) $ 1,026.5 $ 698.2 $ 207.4 $ 120.9 $ 985.3 $ 671.4 $ 192.0 $ 121.9 $ 976.2 $ 670.8 $ 191.0 $ 114.4 ____________ See accompanying notes immediately following these AUM tables. 39 Table of Contents Passive AUM by Channel (1) 2024 2023 2022 (in billions) Total Retail Institutional Total Retail Institutional Total Retail Institutional Beginning Assets (January 1) $ 600.0 $ 540.5 $ 59.5 $ 433.0 $ 390.2 $ 42.8 $ 528.4 $ 474.8 $ 53.6 Long-term inflows 225.0 210.0 15.0 134.8 121.1 13.7 132.4 126.9 5.5 Long-term outflows (144.5) (130.8) (13.7) (95.6) (88.5) (7.1) (104.6) (100.0) (4.6) Net long-term flows 80.5 79.2 1.3 39.2 32.6 6.6 27.8 26.9 0.9 Net flows in non-management fee earning AUM 29.8 28.7 1.1 6.2 5.8 0.4 (3.2) 0.9 (4.1) Total net flows 110.3 107.9 2.4 45.4 38.4 7.0 24.6 27.8 (3.2) Market gains and losses 112.7 101.0 11.7 121.1 111.5 9.6 (117.9) (111.7) (6.2) Foreign currency translation (3.5) (1.3) (2.2) 0.5 0.4 0.1 (2.1) (0.7) (1.4) Ending Assets (December 31) $ 819.5 $ 748.1 $ 71.4 $ 600.0 $ 540.5 $ 59.5 $ 433.0 $ 390.2 $ 42.8 Passive AUM by Client Domicile (2) 2024 2023 2022 (in billions) Total Americas APAC EMEA Total Americas APAC EMEA Total Americas APAC EMEA Beginning Assets (January 1) $ 600.0 $ 462.5 $ 43.5 $ 94.0 $ 433.0 $ 328.6 $ 32.5 $ 71.9 $ 528.4 $ 408.0 $ 38.5 $ 81.9 Long-term inflows 225.0 128.4 36.3 60.3 134.8 76.0 16.0 42.8 132.4 80.0 7.3 45.1 Long-term outflows (144.5) (78.9) (24.7) (40.9) (95.6) (46.3) (12.0) (37.3) (104.6) (60.4) (6.4) (37.8) Net long-term flows 80.5 49.5 11.6 19.4 39.2 29.7 4.0 5.5 27.8 19.6 0.9 7.3 Net flows in non-management fee earning AUM 29.8 23.8 0.1 5.9 6.2 7.2 (0.3) (0.7) (3.2) (3.6) 1.0 (0.6) Total net flows 110.3 73.3 11.7 25.3 45.4 36.9 3.7 4.8 24.6 16.0 1.9 6.7 Market gains and losses 112.7 81.8 10.1 20.8 121.1 97.0 7.3 16.8 (117.9) (95.3) (6.3) (16.3) Foreign currency translation (3.5) (0.3) (2.5) (0.7) 0.5 — — 0.5 (2.1) (0.1) (1.6) (0.4) Ending Assets (December 31) $ 819.5 $ 617.3 $ 62.8 $ 139.4 $ 600.0 $ 462.5 $ 43.5 $ 94.0 $ 433.0 $ 328.6 $ 32.5 $ 71.9 ____________ See accompanying notes immediately following these AUM tables. 40 Table of Contents Invesco Ltd.
In addition, if we have not declared and paid or set aside for payment quarterly dividends on the preferred stock for six quarterly periods, whether or not consecutive, the number of directors of the company will be increased by two and the holders of the preferred shares shall have the right to elect such two additional members of the Board of Directors.
In addition, if we have not declared and paid or set aside for payment quarterly dividends on the preferred stock for six quarterly periods, whether or not consecutive, the number of directors of the company will be increased by two and the holders of the preferred shares shall have the right to elect such two additional members of the Board.
Financial covenants under the credit agreement include: (i) the quarterly maintenance of an Adjusted debt/Earnings before income tax, depreciation, amortization, interest expense, common share-based compensation expense, unrealized (gains)/losses from investments, net, and unusual or otherwise non-recurring gains and losses (Covenant Adjusted EBITDA) leverage ratio, as defined in the credit agreement, of not greater than 3.25:1.00, (ii) an interest coverage ratio (Covenant Adjusted EBITDA/interest expense for the four consecutive fiscal quarters ended before the date of determination) of not less than 4.00:1.00.
Financial covenants under the revolving credit agreement include: (i) the quarterly maintenance of an Adjusted debt/Earnings before income tax, depreciation, amortization, interest expense, common share-based compensation expense, unrealized (gains)/losses from investments, net, and unusual or otherwise non-recurring gains and losses (Covenant Adjusted EBITDA) leverage ratio, as defined in the revolving credit agreement, of not greater than 3.25:1.00, (ii) an interest coverage ratio (Covenant Adjusted EBITDA/interest expense for the four consecutive fiscal quarters ended before the date of determination) of not less than 4.00:1.00.
Liquidity and Capital Resources Our capital structure, together with available cash balances, cash flows generated from operations, existing capacity under our credit agreement and further capital market activities, if necessary, should provide us with sufficient resources to meet present and future cash needs, including operating expenses, debt and other obligations as they come due and anticipated future capital requirements.
Liquidity and Capital Resources Our capital structure, together with available cash balances, cash flows generated from operations, existing capacity under our revolving credit agreement and further capital market activities, if necessary, should provide us with sufficient resources to meet present and future cash needs, including operating expenses, debt and other obligations as they come due and anticipated future capital requirements.
Holders of our preferred shares are eligible to receive dividends at an annual rate of 5.9% of the liquidation preference of $1,000 per share, or $59 per share per annum. The preferred dividend is payable quarterly on a non-cumulative basis when, if and as declared by our board of directors.
Holders of our preferred shares are eligible to receive dividends at an annual rate of 5.9% of the liquidation preference of $1,000 per share, or $59 per share per annum. The preferred dividend is payable quarterly on a non-cumulative basis when, if and as declared by our Board.
GAAP measures to the non-GAAP measures. To further enhance the readability of the Results of Operations section, separate tables for each of the revenue, expense and other income and expenses (non-operating income/expense) sections of the income statement introduce the narrative that follows, providing a section-by-section review of the company’s income statements for the periods presented.
GAAP measures to the non-GAAP measures. To enhance the readability of the Results of Operations section, separate tables for each of the revenue, expense and other income and expenses (non-operating income/expense) sections of the income statement introduce the narrative that follows, providing a section-by-section review of the company’s income statements for the periods presented.
Therefore, movements in global capital market levels, net business inflows (or outflows), and changes in the mix of investment products between asset classes and geographies may materially affect our revenues from period to period.
Therefore, movements in global capital market levels, net inflows (or outflows), and changes in the mix of investment products between asset classes and geographies may materially affect our revenues from period to period.
The calculation of Covenant Adjusted EBITDA above (a reconciliation from net income attributable to Invesco Ltd.) is defined by our credit agreement, and therefore Net income attributable to Invesco Ltd. is the most appropriate GAAP measure from which to reconcile to Covenant Adjusted EBITDA.
The calculation of Covenant Adjusted EBITDA above (a reconciliation from Net income attributable to Invesco Ltd.) is defined by our revolving credit agreement, and therefore Net income attributable to Invesco Ltd. is the most appropriate GAAP measure from which to reconcile to Covenant Adjusted EBITDA.
Peer group rankings are sourced from a widely-used third-party ranking agency in each fund’s market (e.g., Morningstar, IA, Lipper, eVestment, Mercer, Galaxy, SITCA, Value Research) and asset-weighted in USD. Rankings are as of prior quarter-end for most institutional products and prior month-end for Australian retail funds due to their late release by third parties.
Peer group ranking are sourced from a widely-used third party ranking agency in each fund’s market (Morningstar, IA, Lipper, eVestment, Mercer, Galaxy, SITCA, Value Research) and asset-weighted in USD. Rankings are as of prior quarter-end for most institutional products and prior month-end for Australian retail funds due to their late release by third parties.
Additionally, management evaluates Net revenue yield on AUM, which is equal to Net revenues divided by Average AUM during the reporting period, as an indicator of the basis point Net revenues we receive for each dollar of AUM we manage. Investment management fees are adjusted by renewal commissions and certain administrative fees.
Additionally, management evaluates Net revenue yield on AUM, which is equal to Net revenues divided by Average AUM during the reporting period, as an indicator of the Net revenues we receive for each dollar of AUM we manage. Investment management fees are adjusted by renewal commissions and certain administrative fees.
If the company were to liquidate, the collateral assets would not be available to the general creditors of the company, and as a result, the company does not consider them to be company assets. Likewise, the investors in the CLOs have no recourse to the general credit of the company for the notes issued by the CLOs.
If the company were to liquidate, the collateral assets would not be available to the general creditors of the company, and as a result, the company does not consider these assets to be company assets. Likewise, the investors in the CLOs have no recourse to the general credit of the company for the notes issued by the CLOs.
The table in the “Executive Overview” section of this Management's Discussion and Analysis summarizes returns based on price appreciation/(depreciation) of several major market indices for the years ended December 31, 2023 and December 31, 2022.
The table in the “Executive Overview” section of this Management's Discussion and Analysis summarizes returns based on price appreciation/(depreciation) of several major market indices for the years ended December 31, 2024 and December 31, 2023.
Summary operating information for 2023, 2022 and 2021 is presented in the table below. (in millions, other than per common share amounts, operating margins and AUM) Year ended December 31, U.S.
Summary operating information for 2024, 2023 and 2022 is presented in the table below. (in millions, other than per common share amounts, operating margins and AUM) Year ended December 31, U.S.
Cash inflows for the year ended December 31, 2023, excluding the impact of CIP, were primarily driven by operating income and changes in payables and receivables due to the timing of payments and receipts.
Cash inflows for the year ended December 31, 2024, excluding the impact of CIP, were primarily driven by operating income and changes in payables and receivables due to the timing of payments and receipts.
Adjusted net income is reduced by the amount of earning attributable to the 51% noncontrolling interests. (3) CIP: See Part II, Item 8, Financial Statements and Supplementary Data, note 19, “Consolidated Investment Products,” for a detailed analysis of the impact to the company’s Condensed Consolidated Financial Statements from the consolidation of CIP.
Adjusted net income is reduced by the amount of earning attributable to the noncontrolling interests. (3) CIP: See Part II, Item 8, Financial Statements and Supplementary Data, Note 18, “Consolidated Investment Products,” for a detailed analysis of the impact to the company’s Condensed Consolidated Financial Statements from the consolidation of CIP.
The company recognizes any interest and penalties related to unrecognized tax benefits (UTBs) on the Consolidated Statements of Income as components of income tax expense. CIP Assessing if an entity is a variable interest entity (VIE) or voting interest entity (VOE) involves judgment and analysis on a structure-by-structure basis.
The company recognizes any interest and penalties related to unrecognized tax benefits (UTBs) on the Consolidated Statements of Income as components of income tax expense. 58 Table of Contents CIP Assessing if an entity is a variable interest entity (VIE) or voting interest entity (VOE) involves judgment and analysis on a structure-by-structure basis.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations The discussion and analysis disclosed herein apply to material changes in the Consolidated Financial Statements for 2023 and 2022.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations The discussion and analysis disclosed herein apply to material changes in the Consolidated Financial Statements for 2024 and 2023.
(12) Adjusted diluted EPS is equal to Adjusted net income attributable to Invesco Ltd. divided by the weighted average number of common and restricted common shares outstanding. 48 Ta ble of Contents Balance Sheet Discussion (1) The following table represents a reconciliation of the balance sheet information presented on a U.S.
(12) Adjusted diluted EPS is equal to Adjusted net income attributable to Invesco Ltd. divided by the weighted average number of common and restricted common shares outstanding. 50 Table of Contents Balance Sheet Discussion (1) The following table represents a reconciliation of the balance sheet information presented on a U.S.
To assess the impact of CIP on the company's Results of Operations and Balance Sheet Discussion, refer to Part II, Item 8, Financial Statements and Supplementary Data, Note 19, "Consolidated Investment Products." 30 Ta ble of Contents Summary Operating Information Wherever a non-GAAP measure is referenced, a disclosure will follow in the narrative or in the note referring the reader to the Schedule of Non-GAAP Information, where additional details regarding the use of the non-GAAP measure by the company are disclosed, along with reconciliations of the most directly comparable U.S.
To assess the impact of CIP on the company's Results of Operations and Balance Sheet Discussion, refer to Part II, Item 8, Financial Statements and Supplementary Data, Note 18, "Consolidated Investment Products." 31 Table of Contents Summary Operating Information Wherever a non-GAAP measure is referenced, a disclosure will follow in the narrative or in the note referring the reader to the Schedule of Non-GAAP Information, where additional details regarding the use of the non-GAAP measure by the company are disclosed, along with reconciliations of the most directly comparable U.S.
Assessing if the company has the power to direct the activities that most significantly impact the fund’s economic results may involve significant judgment. Recent Accounting Standards See Part II, Item 8, Financial Statements and Supplementary Data - Note 1, “Accounting Policies - Accounting Pronouncements Recently Adopted and Pending Accounting Pronouncements.” 57 Ta ble of Contents
Assessing if the company has the power to direct the activities that most significantly impact the fund’s economic results may involve significant judgment. Recent Accounting Standards See Part II, Item 8, Financial Statements and Supplementary Data - Note 1, “Accounting Policies - Accounting Pronouncements Recently Adopted and Pending Accounting Pronouncements.”
The most sensitive assumptions used in the income approach are the long-term growth rate and the discount rate applied to the cash flow forecast to determine present value. Taking into consideration the company’s AUM mix, the long-term growth rate was determined using the historical returns of the S&P 500 index, treasury bonds and treasury bills.
The most sensitive assumptions used in the income approach are the long-term growth rate and the discount rate applied to the cash flow forecast to determine present value. Taking into consideration the AUM mix of the U.S. retail mutual funds, the long-term growth rate was determined using the historical returns of the S&P 500 index, treasury bonds and treasury bills.
Management, performance and other fees earned from CIP Management believes that the consolidation of investment products may impact a reader's analysis of our underlying results of operations and could result in investor confusion or the production of information about the company by analysts or external credit rating agencies that is not reflective of the underlying results of operations and financial condition of the company.
CIP Management believes that the consolidation of investment products may impact a reader's analysis of our underlying results of operations and could result in investor confusion or the production of information about the company by analysts or external credit rating agencies that is not reflective of the underlying results of operations and financial condition of the company.
For the comparison of 2022 and 2021, see the Management's Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of the company’s 2022 Annual Report on Form 10-K, filed with the SEC on February 22, 2023.
For the comparison of 2023 and 2022, see the Management's Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of the company’s 2023 Annual Report on Form 10-K, filed with the SEC on February 21, 2024.
(3) Covenant Adjusted EBITDA and Adjusted debt are non-GAAP financial measures that are used by management in connection with certain debt covenant calculations under our credit agreement.
(4) Covenant Adjusted EBITDA and Adjusted debt are non-GAAP financial measures that are used by management in connection with certain debt covenant calculations under our revolving credit agreement.
The net flows in non-management fee earning AUM can be relatively short-term in nature and, due to the relatively low revenue yield, these can have a significant impact on overall net revenue yield. 32 Ta ble of Contents The AUM tables and the discussion below refer to certain AUM as long-term.
The net flows in non-management fee earning AUM can be relatively short-term in nature and, due to the relatively low revenue yield, these net flows can have a significant impact on overall net revenue yield. The AUM tables and the discussion below refer to certain AUM as long-term.
For additional income tax information, please refer to Note 15, “Taxation,” in Part II, Item 8, Financial Statements and Supplementary Data. 46 Ta ble of Contents Schedule of Non-GAAP Information We utilize the following non-GAAP performance measures: Net revenue (and by calculation, Net revenue yield on AUM), Adjusted operating income, Adjusted operating margin, Adjusted net income attributable to Invesco and Adjusted diluted EPS.
For additional income tax information, please refer to Note 14, “Taxation,” in Part II, Item 8, Financial Statements and Supplementary Data. 47 Table of Contents Schedule of Non-GAAP Information We utilize the following non-GAAP performance measures: Net revenue (and by calculation, Net revenue yield on AUM), Adjusted operating income, Adjusted operating margin, Adjusted net income attributable to Invesco and Adjusted diluted EPS.
Debt The carrying value of our debt at December 31, 2023 was $1,489.5 million (December 31, 2022: $1,487.6 million), See Item 8, Financial Statements and Supplementary Data, Note 8, “Debt,” for additional disclosures. For the year ended December 31, 2023, the company's weighted average cost of debt was 4.28% (year ended December 31, 2022: 4.15%).
Debt The carrying value of our debt at December 31, 2024 was $890.6 million (December 31, 2023: $1,489.5 million), See Item 8, Financial Statements and Supplementary Data, Note 8, “Debt,” for additional disclosures. For the year ended December 31, 2024, the company's weighted average cost of debt was 4.64% (year ended December 31, 2023: 4.28%).
An impairment in the future would not impact the company’s liquidity or capital resources. 56 Ta ble of Contents Income Taxes The company files U.S. federal, state and numerous foreign income tax returns. The income tax laws are complex and subject to different interpretations by the taxpayer and the relevant taxing authorities.
However, an impairment in the future would not impact the company’s liquidity or capital resources. Income Taxes The company files U.S. federal, state and numerous foreign income tax returns. The income tax laws are complex and subject to different interpretations by the taxpayer and the relevant taxing authorities.
As of December 31, 2023, we were in compliance with our financial covenants.
As of December 31, 2024, we were in compliance with our financial covenants.
These costs are reimbursed by the related funds. Third-party distribution service and advisory expenses were $1,825.2 million for the year ended December 31, 2023 as compared to $1,886.2 million for the year ended December 31, 2022.
These costs are reimbursed by the related funds. Third-party distribution, service and advisory expenses were $2,025.6 million for the year ended December 31, 2024 as compared to $1,825.2 million for the year ended December 31, 2023.
Common Share Repurchase Plan During 2023, the company repurchased 9.6 million shares for $150 million in the open market as compared to 8.9 million shares for $200 million during 2022. At December 31, 2023, approximately $382.2 million remained authorized under the company's common share repurchase authorization approved by the Board on July 22, 2016 (December 31, 2022: $532.2 million).
Common Share Repurchase Plan During 2024, the company repurchased 2.9 million shares for $49.6 million in the open market as compared to 9.6 million shares for $150 million during 2023. At December 31, 2024, approximately $332.6 million remained authorized under the company's common share repurchase authorization approved by the Board on July 22, 2016 (December 31, 2023: $382.2 million).
For the year ended December 31, 2023, other gains and losses of CIP were a net loss of $176.3 million as compared to a net loss of $126.9 million for the year ended December 31, 2022. The net losses in 2023 and 2022 were attributable to market-driven losses on investments held by consolidated funds.
For the year ended December 31, 2024, other gains and losses of CIP were a net loss of $57.9 million as compared to a net loss of $176.3 million for the year ended December 31, 2023. The net losses for the years ended December 31, 2024 and 2023 were attributable to market-driven losses on investments held by consolidated funds.
GAAP. See “Schedule of Non-GAAP Information” for a reconciliation of the most directly comparable U.S. GAAP measures to the non-GAAP measures. 31 Ta ble of Contents Investment Capabilities Performance Overview Invesco's first strategic objective reflects a commitment to deliver the excellence our clients expect, which includes strong investment performance over the long-term for our clients .
GAAP. See “Schedule of Non-GAAP Information” for a reconciliation of the most directly comparable U.S. GAAP measures to the non-GAAP measures. 32 Table of Contents Investment Capabilities Performance Overview Invesco's first strategic objective is a commitment to deliver the excellence our clients expect, which includes strong investment performance over the long-term for our clients.
Income Tax Expense The tax provision was a benefit of $(69.7) million for the year ended December 31, 2023 compared to an expense of $322.2 million for the year ended December 31, 2022, resulting in effective tax rates of 29.3% and 25.8% for the years ended December 31, 2023 and 2022, respectively.
Income Tax Expense The income tax provision was an expense of $252.9 million for the year ended December 31, 2024, compared to a benefit of $(69.7) million for the year ended December 31, 2023, resulting in effective tax rates of 25.2% and 29.3% for the years ended December 31, 2024 and 2023, respectively.
During the year ended December 31, 2023, the company repurchased 9.6 million common shares for $150.0 million in the open market. As of December 31, 2023, approximately $382.2 million remained authorized under the company’s common share repurchase authorization approved by the Board on July 22, 2016.
During the year ended December 31, 2024, the company repurchased 2.9 million common shares for $49.6 million in the open market. As of December 31, 2024, approximately $332.6 million remained authorized under the company’s common share repurchase authorization approved by the Board on July 22, 2016.
Financing cash outflows during the year ended December 31, 2022 also included a $600.0 million redemption of senior notes. Net borrowings under the floating rate credit agreement were zero during the years ended December 31, 2023 and December 31, 2022. Dividends When declared, Invesco pays dividends on a quarterly basis in arrears.
Financing cash outflows during the year ended December 31, 2024 also included a $600.0 million redemption of senior notes. Net borrowings under the revolving credit agreement were zero during the years ended December 31, 2024 and December 31, 2023. 54 Table of Contents Dividends When declared, Invesco pays dividends on a quarterly basis in arrears.
GAAP basis to the cash flow information, excluding the impact of the cash flows of CIP for the reasons outlined in footnote 1 to the table: Cash flows information (1) Year ended December 31, 2023 Year ended December 31, 2022 Year ended December 31, 2021 (in millions) U.S. GAAP Impact of CIP As Adjusted U.S.
GAAP basis to the cash flow information, excluding the impact of the cash flows of CIP for the reasons outlined in footnote 1 to the table: Years ended December 31, Cash flows information (1) 2024 2023 2022 (in millions) U.S. GAAP Impact of CIP Excluding CIP U.S. GAAP Impact of CIP Excluding CIP U.S.
Presentation of Management's Discussion and Analysis of Financial Condition and Results of Operations - Impact of Consolidated Investment Products (CIP) The company provides investment management services to, and has transactions with, retail mutual funds and other investment products sponsored by the company for the investment of client assets in the normal course of business.
Presentation of Management's Discussion and Analysis of Financial Condition and Results of Operations - Impact of Consolidated Investment Products (CIP) The company provides investment management services to, and has transactions with, investment products sponsored by the company in the normal course of business.
Operating Income, Adjusted Operating Income, Operating Margin and Adjusted Operating Margin Operating loss was $434.8 million in the year ended December 31, 2023, as compared to operating income of $1,317.7 million for the year ended December 31, 2022.
Operating Income, Adjusted Operating Income, Operating Margin and Adjusted Operating Margin Operating income was $832.1 million in the year ended December 31, 2024, as compared to an operating loss of $434.8 million for the year ended December 31, 2023.
(6) Market movement on deferred compensation plan liabilities: Certain deferred compensation plan awards involve a return to the employee linked to the appreciation (depreciation) of specified investments. The company hedges economically the exposure to market movements for these investments.
(6) Market valuation changes related to deferred compensation plan liabilities: Certain deferred compensation plan awards provide a return to the employee linked to the appreciation (depreciation) of specified investments. The company economically hedges the exposure to market movements on these deferred compensation liabilities.
On January 23, 2024, the company declared a fourth quarter 2023 cash dividend of $0.20 per common share to the holders of common shares. The dividend is payable on March 4, 2024, to common shareholders of record at the close of business on February 16, 2024, with an ex-dividend date of February 15, 2024.
On January 27, 2025, the company declared a fourth quarter 2024 cash dividend of $0.205 per common share to the holders of common shares. The dividend is payable on March 4, 2025, to common shareholders of record at the close of business on February 14, 2025, with an ex-dividend date of February 14, 2025.
Based on our annual impairment analysis as of October 1, 2023, we determined that the carrying value of the indefinite-lived intangible assets related to acquired management contracts of U.S. retail mutual funds of $5,818.6 million exceeded the estimated fair value.
Based on our annual impairment analysis as of October 1, 2024, we determined that the estimated fair value of the indefinite-lived intangible assets related to acquired management contracts of U.S. retail mutual funds exceeded its carrying value of $4,572.1 million by $267.4 million or 6%.
After allowing for the change in cash held by CIP, investment activities, non-cash activity, including the $1,248.9 million intangible asset impairment in 2023, and seasonal payments, such as bonus payments in the first quarter, our operating cash flows generally move in the same direction as our Operating income/(loss).
After allowing for the change in cash held by CIP, investment activities, non-cash activity, and seasonal payments, such as bonus payments in the first quarter, our operating cash flows generally move in the same direction as our Operating income/(loss).
On January 23, 2024, the company announced a preferred dividend of $14.75 per preferred share representing the period from December 1, 2023 through February 28, 2024. The preferred dividend is payable on March 1, 2024.
On January 27, 2025, the company declared a preferred dividend of $14.75 per preferred share representing the period from December 1, 2024 through February 28, 2025. The preferred dividend is payable on March 3, 2025.
GAAP basis $ 5,716.4 $ 6,048.9 $ 6,894.5 Revenue Adjustments: (1) Investment management fees (766.4) (764.7) (844.1) Service and distribution fees (911.7) (961.1) (1,087.5) Other (147.1) (160.4) (217.7) Total Revenue Adjustments (1,825.2) (1,886.2) (2,149.3) Invesco Great Wall (2) 368.3 432.7 473.5 CIP (3) 51.2 49.6 42.4 Net revenues $ 4,310.7 $ 4,645.0 $ 5,261.1 Reconciliation of Operating income/(loss) to Adjusted operating income: (in millions) 2023 2022 2021 Operating income/(loss), U.S.
GAAP basis $ 6,067.0 $ 5,716.4 $ 6,048.9 Revenue adjustments: (1) Investment management fees (816.6) (766.4) (764.7) Service and distribution fees (1,048.8) (911.7) (961.1) Other (160.2) (147.1) (160.4) Total revenue adjustments (2,025.6) (1,825.2) (1,886.2) Invesco Great Wall (2) 318.1 368.3 432.7 CIP (3) 41.0 51.2 49.6 Net revenues $ 4,400.5 $ 4,310.7 $ 4,645.0 Reconciliation of Operating income/(loss) to Adjusted operating income: (in millions) 2024 2023 2022 Operating income/(loss), U.S.
GAAP basis to the balance sheet information excluding the impact of CIP and policyholder balances for the reasons outlined in footnote 1 to the table: As of December 31, 2023 As of December 31, 2022 Balance sheet information (in millions) U.S. GAAP Impact of CIP Impact of Policyholders As Adjusted U.S.
GAAP basis to the balance sheet information excluding the impact of CIP for the reasons outlined in footnote 1 to the table: December 31, 2024 December 31, 2023 Balance sheet information (in millions) U.S. GAAP Impact of CIP Excluding CIP U.S.
The calculation of 2023 Adjusted debt is defined in our amended credit agreement and equals debt of $1,489.5 million plus $2.8 million in letters of credit less $500.0 million of excess unrestricted cash (cash and cash equivalents less the minimum regulatory capital requirement, not to exceed $500 million (2022: $200.0 million).
The calculation of 2024 Adjusted debt is defined in our amended revolving credit agreement and equals debt of $890.6 million plus $3.2 million in letters of credit less $500.0 million of excess unrestricted cash (cash and cash equivalents less the minimum regulatory capital requirement, not to exceed $500 million (2023: $500.0 million).
See discussion above on how AUM changes impact our Investment management fees. 41 Ta ble of Contents Service and Distribution Fees For the year ended December 31, 2023, Service and distribution fees were $1,374.6 million as compared to $1,405.5 million for the year ended December 31, 2022.
See discussion above on how AUM changes impact our Investment management fees. 42 Table of Contents Service and Distribution Fees For the year ended December 31, 2024, Service and distribution fees were $1,479.7 million as compared to $1,374.6 million for the year ended December 31, 2023.
Other Income and Expenses The main categories of other income and expenses, and the dollar and percentage changes between periods are as follows: Variance Years ended December 31, 2023 vs 2022 2022 vs 2021 (in millions) 2023 2022 2021 $ Change % Change $ Change % Change Equity in earnings of unconsolidated affiliates $ 71.3 $ 106.1 $ 152.3 $ (34.8) (32.8) % $ (46.2) (30.3) % Interest and dividend income 47.8 24.4 25.2 23.4 95.9 % (0.8) (3.2) % Interest expense (70.5) (85.2) (94.7) 14.7 (17.3) % 9.5 (10.0) % Other gains and losses, net 98.0 (139.5) 120.5 237.5 N/A (260.0) N/A Other income/(expense) of CIP, net 50.3 24.2 509.0 26.1 107.9 % (484.8) (95.2) % Total other income and expenses $ 196.9 $ (70.0) $ 712.3 $ 266.9 N/A $ (782.3) N/A Equity in earnings of unconsolidated affiliates Equity in earnings of unconsolidated affiliates decreased to $71.3 million for the year ended December 31, 2023 as compared to $106.1 million for the year ended December 31, 2022.
Other Income and Expenses The main categories of other income and expenses, and the dollar and percentage changes between periods are as follows: Years ended December 31, 2024 vs 2023 2023 vs 2022 (in millions) 2024 2023 2022 $ Change % Change $ Change % Change Equity in earnings of unconsolidated affiliates $ 43.0 $ 71.3 $ 106.1 $ (28.3) (39.7) % $ (34.8) (32.8) % Interest and dividend income 58.9 47.8 24.4 11.1 23.2 % 23.4 95.9 % Interest expense (58.0) (70.5) (85.2) 12.5 (17.7) % 14.7 (17.3) % Other gains and losses, net 47.7 98.0 (139.5) (50.3) (51.3) % 237.5 N/A Other income/(expense) of CIP, net 81.6 50.3 24.2 31.3 62.2 % 26.1 107.9 % Total other income and expenses $ 173.2 $ 196.9 $ (70.0) $ (23.7) (12.0) % $ 266.9 N/A Equity in earnings of unconsolidated affiliates Equity in earnings of unconsolidated affiliates decreased to $43.0 million for the year ended December 31, 2024 as compared to $71.3 million for the year ended December 31, 2023.
GAAP Financial Measures Summary 2023 2022 2021 Operating revenues $ 5,716.4 $ 6,048.9 $ 6,894.5 Operating income/(loss) $ (434.8) $ 1,317.7 $ 1,788.2 Operating margin (7.6) % 21.8 % 25.9 % Net income/(loss) attributable to Invesco Ltd. $ (333.7) $ 683.9 $ 1,393.0 Diluted earnings per share (EPS) $ (0.73) $ 1.49 $ 2.99 Non-GAAP Financial Measures Summary (1) Net revenues $ 4,310.7 $ 4,645.0 $ 5,261.1 Adjusted operating income $ 1,213.5 $ 1,614.8 $ 2,182.6 Adjusted operating margin 28.2 % 34.8 % 41.5 % Adjusted net income attributable to Invesco Ltd. $ 689.7 $ 773.2 $ 1,439.6 Adjusted diluted earnings per share (EPS) $ 1.51 $ 1.68 $ 3.09 Assets Under Management Ending AUM (billions) $ 1,585.3 $ 1,409.2 $ 1,610.9 Average AUM (billions) $ 1,500.6 $ 1,452.5 $ 1,499.9 _________ (1) Net revenues, Adjusted Operating Income (and by calculation, adjusted operating margin), and Adjusted Net Income (and by calculation, adjusted diluted EPS) are non-GAAP financial measures, based on methodologies other than U.S.
GAAP Financial Measures Summary 2024 2023 2022 Operating revenues $ 6,067.0 $ 5,716.4 $ 6,048.9 Operating income/(loss) $ 832.1 $ (434.8) $ 1,317.7 Operating margin 13.7 % (7.6) % 21.8 % Net income/(loss) attributable to Invesco Ltd. $ 538.0 $ (333.7) $ 683.9 Diluted earnings per share (EPS) $ 1.18 $ (0.73) $ 1.49 Non-GAAP Financial Measures Summary (1) Net revenues $ 4,400.5 $ 4,310.7 $ 4,645.0 Adjusted operating income $ 1,370.7 $ 1,213.5 $ 1,614.8 Adjusted operating margin 31.1 % 28.2 % 34.8 % Adjusted net income attributable to Invesco Ltd. $ 781.7 $ 689.7 $ 773.2 Adjusted diluted earnings per share (EPS) $ 1.71 $ 1.51 $ 1.68 Assets Under Management Ending AUM (billions) $ 1,846.0 $ 1,585.3 $ 1,409.2 Average AUM (billions) $ 1,712.2 $ 1,500.6 $ 1,452.5 _________ (1) Net revenues, Adjusted Operating Income (and by calculation, adjusted operating margin), and Adjusted Net Income (and by calculation, adjusted diluted EPS) are non-GAAP financial measures, based on methodologies other than U.S.
Passive net revenue yield is calculated excluding QQQ AUM. 33 Ta ble of Contents Flows There are numerous drivers of AUM inflows and outflows, including individual investor decisions to change investment preferences, fiduciaries and other gatekeepers making broad asset allocation decisions on behalf of their clients, and reallocation of investments within portfolios.
Flows There are numerous drivers of AUM inflows and outflows, including individual investor decisions to change investment preferences, fiduciaries and other gatekeepers making broad asset allocation decisions on behalf of their clients, and reallocation of investments within portfolios.
Our capital process is executed in a manner consistent with our desire to maintain strong, investment grade credit ratings. As of the date of our filing, Invesco held credit ratings of A3/Stable, BBB+/Stable and A/Stable from Moody's, S&P, and Fitch, respectively. Other Items Certain of our subsidiaries are required to maintain minimum levels of regulatory capital, liquidity, and working capital.
Our capital process is executed in a manner consistent with our desire to maintain strong, investment grade credit ratings. As of the date of our filing, Invesco held credit ratings of BBB+/Stable, A3/Stable and A/Stable from S&P Ratings Service, Moody’s Investor Services and Fitch Ratings, respectively.
GAAP Impact of CIP As Adjusted Cash and cash equivalents beginning of the period $ 1,434.1 $ (199.4) $ 1,234.7 $ 2,147.1 $ (250.7) $ 1,896.4 $ 1,839.3 $ (301.7) $ 1,537.6 Cash flows from operating activities (1) 1,300.8 (136.6) 1,164.2 703.2 414.1 1,117.3 1,078.1 436.1 1,514.2 Cash flows from investing activities (244.3) 72.8 (171.5) (375.6) 81.5 (294.1) (847.9) 755.4 (92.5) Cash flows from financing activities (585.4) (196.8) (782.2) (966.9) (449.4) (1,416.3) 117.3 (1,148.0) (1,030.7) Increase/(decrease) in cash and cash equivalents 471.1 (260.6) 210.5 (639.3) 46.2 (593.1) 347.5 43.5 391.0 Foreign exchange movement on cash and cash equivalents 26.4 (2.4) 24.0 (73.7) 5.1 (68.6) (39.7) 7.5 (32.2) Cash and cash equivalents, end of the period $ 1,931.6 $ (462.4) $ 1,469.2 $ 1,434.1 $ (199.4) $ 1,234.7 $ 2,147.1 $ (250.7) $ 1,896.4 Cash and cash equivalents $ 1,469.2 $ — $ 1,469.2 $ 1,234.7 $ — $ 1,234.7 $ 1,896.4 $ — $ 1,896.4 Cash and cash equivalents of CIP 462.4 (462.4) — 199.4 (199.4) — 250.7 (250.7) — Total cash and cash equivalents per consolidated statement of cash flows $ 1,931.6 $ (462.4) $ 1,469.2 $ 1,434.1 $ (199.4) $ 1,234.7 $ 2,147.1 $ (250.7) $ 1,896.4 ____________ (1) These tables include non-GAAP presentations.
GAAP Impact of CIP Excluding CIP Cash and cash equivalents beginning of the period $ 1,931.6 $ (462.4) $ 1,469.2 $ 1,434.1 $ (199.4) $ 1,234.7 $ 2,147.1 $ (250.7) $ 1,896.4 Cash flows from operating activities 1,190.0 (114.8) 1,075.2 1,300.8 (136.6) 1,164.2 703.2 414.1 1,117.3 Cash flows from investing activities 68.4 (308.4) (240.0) (244.3) 72.8 (171.5) (375.6) 81.5 (294.1) Cash flows from financing activities (1,661.6) 374.0 (1,287.6) (585.4) (196.8) (782.2) (966.9) (449.4) (1,416.3) Increase/(decrease) in cash and cash equivalents (403.2) (49.2) (452.4) 471.1 (260.6) 210.5 (639.3) 46.2 (593.1) Foreign exchange movement on cash and cash equivalents (32.4) 2.1 (30.3) 26.4 (2.4) 24.0 (73.7) 5.1 (68.6) Cash and cash equivalents, end of the period $ 1,496.0 $ (509.5) $ 986.5 $ 1,931.6 $ (462.4) $ 1,469.2 $ 1,434.1 $ (199.4) $ 1,234.7 Cash and cash equivalents $ 986.5 $ — $ 986.5 $ 1,469.2 $ — $ 1,469.2 $ 1,234.7 $ — $ 1,234.7 Cash and cash equivalents of CIP 509.5 (509.5) — 462.4 (462.4) — 199.4 (199.4) — Total cash and cash equivalents per consolidated statement of cash flows $ 1,496.0 $ (509.5) $ 986.5 $ 1,931.6 $ (462.4) $ 1,469.2 $ 1,434.1 $ (199.4) $ 1,234.7 ____________ (1) These tables include non-GAAP presentations.
Management used an income approach to value the reporting unit. An income approach includes assumptions for current market conditions, including the company's updated forecasts for changes in AUM due to market gains or losses, net long-term flows and the corresponding changes in revenue and expenses.
An income approach includes assumptions for current market conditions, including the asset’s updated forecasts of AUM to take into consideration market gains or losses, net long-term flows and the corresponding changes in revenue and expenses.
Capital Management Our capital management priorities have evolved with the growth and success of our business and include, in no particular order of priority: reinvestment in the business, maintaining a strong balance sheet and returning capital to shareholders longer term through a combination of modestly increasing dividends and share repurchases.
Purchase obligations are recorded as liabilities in the company's Consolidated Financial Statements when services are provided. 52 Table of Contents Capital Management Our capital management priorities have evolved with the growth and success of our business and include, in no particular order of priority: reinvestment in the business, maintaining a strong balance sheet and returning capital to shareholders longer term through a combination of share repurchases and modestly increasing dividends.
Management and Performance fees earned from CIP were $51.2 million in the year ended December 31, 2023, as compared to $49.6 million for the year ended December 31, 2022. 42 Ta ble of Contents Operating Expenses The main categories of operating expenses, and the dollar and percentage changes between periods, are as follows: Variance Years ended December 31, 2023 vs 2022 2022 vs 2021 (in millions) 2023 2022 2021 $ Change % Change $ Change % Change Third-party distribution, service and advisory $ 1,825.2 $ 1,886.2 $ 2,149.3 $ (61.0) (3.2) % $ (263.1) (12.2) % Employee compensation 1,885.8 1,725.1 1,911.3 160.7 9.3 % (186.2) (9.7) % Marketing 103.4 114.9 98.6 (11.5) (10.0) % 16.3 16.5 % Property, office and technology 546.0 539.8 526.0 6.2 1.1 % 13.8 2.6 % General and administrative 450.4 380.2 424.1 70.2 18.5 % (43.9) (10.4) % Transaction, integration and restructuring 41.6 21.2 (65.9) 20.4 96.2 % 87.1 N/A Amortization and impairment of intangibles 1,298.8 63.8 62.9 1,235.0 1,935.7 % 0.9 1.4 % Total operating expenses $ 6,151.2 $ 4,731.2 $ 5,106.3 $ 1,420.0 30.0 % $ (375.1) (7.3) % The table below sets forth these expense categories as a percentage of total Operating expenses and Operating revenues, which we believe provides useful information as to the relative significance of each type of expense.
Management and Performance fees earned from CIP were $41.0 million in the year ended December 31, 2024, as compared to $51.2 million for the year ended December 31, 2023. 43 Table of Contents Operating Expenses The main categories of operating expenses, and the dollar and percentage changes between periods, are as follows: Years ended December 31, 2024 vs 2023 2023 vs 2022 (in millions) 2024 2023 2022 $ Change % Change $ Change % Change Third-party distribution, service and advisory $ 2,025.6 $ 1,825.2 $ 1,886.2 $ 200.4 11.0 % $ (61.0) (3.2) % Employee compensation 2,014.2 1,885.8 1,725.1 128.4 6.8 % 160.7 9.3 % Marketing (1) 81.3 82.1 94.6 (0.8) (1.0) % (12.5) (13.2) % Property, office and technology (1) 474.3 450.1 446.7 24.2 5.4 % 3.4 0.8 % General and administrative (1) 594.7 567.6 493.6 27.1 4.8 % 74.0 15.0 % Transaction, integration and restructuring (2) — 41.6 21.2 (41.6) N/A 20.4 96.2 % Amortization and impairment of intangibles 44.8 1,298.8 63.8 (1,254.0) (96.6) % 1,235.0 1,935.7 % Total operating expenses $ 5,234.9 $ 6,151.2 $ 4,731.2 $ (916.3) (14.9) % $ 1,420.0 30.0 % The table below sets forth these expense categories as a percentage of total Operating expenses and Operating revenues, which we believe provides useful information as to the relative significance of each type of expense.
We are not a party to these asset allocation decisions, as the company does not generally have access to the underlying investor's decision-making process, including their risk appetite or liquidity needs. Therefore, the company is not in a position to provide meaningful information regarding the drivers of inflows and outflows.
We are not a party to these asset allocation decisions, as the company does not generally have access to the underlying investor's decision-making process, including their risk appetite or liquidity needs.
This overview and the remainder of this management's discussion and analysis and supplements should be read in conjunction with the Consolidated Financial Statements of Invesco Ltd. and the notes thereto contained elsewhere in this Annual Report on Form 10-K. During the year, global capital markets improved; however, the improvement was uneven and undercut by geopolitical events.
This overview and the remainder of this management's discussion and analysis and supplements should be read in conjunction with the Consolidated Financial Statements of Invesco Ltd. and the notes thereto contained elsewhere in this Annual Report on Form 10-K.
Net revenues from IGW were $368.3 million and average AUM was $87.2 billion for the year ended December 31, 2023 (Net revenues were $432.7 million and average AUM was $93.5 billion, for the year ended December 31, 2022).
Net revenues from IGW were $318.1 million and average AUM was $88.6 billion for the year ended December 31, 2024 (Net revenues were $368.3 million and average AUM was $87.2 billion, for the year ended December 31, 2023).
The consolidation of $9,478.4 million and $7,121.8 million of total assets and debt of CIP as of December 31, 2023, respectively, did not impact the company’s liquidity and capital resources.
The consolidation of $8,374.5 million and $6,200.9 million of total assets and debt of CIP as of December 31, 2024, respectively, did not impact the company’s liquidity and capital resources.
GAAP gross revenue yield excludes the management fees earned from CIP; however, the denominator of the measure includes the AUM of these investment products. Net revenue yield metrics include the net revenues and average AUM of IGW and CIP. See “Schedule of Non-GAAP Information” for a reconciliation of operating revenues to net revenues.
GAAP gross revenue yield is not a good measure because the numerator excludes the management fees earned from CIP; however, the denominator of the measure includes the AUM of these investment products. Net revenue yield metrics include the net revenues and average AUM of IGW and CIP.
As of (in millions) December 31, 2023 December 31, 2022 Investments $ 919.1 $ 996.6 Net investment in CIP 527.4 376.8 Less: Investments related to deferred compensation plans, joint ventures, and other investments (490.5) (464.2) Total seed capital and co-investments (1) $ 956.0 $ 909.2 ____________ (1) Included in the total seed and co-investment balance as of December 31, 2023 is $314.1 million of seed capital and $641.9 million of co-investments (December 31, 2022: $305.4 million of seed capital and $603.8 million of co-investments).
The following table reconciles the investment balance to the total seed capital and co-investment balance. 51 Table of Contents (in millions) December 31, 2024 December 31, 2023 Investments $ 1,240.0 $ 919.1 Net investment in CIP 401.4 527.4 Less: Investments related to deferred compensation plans, joint ventures, and other investments (515.8) (490.5) Total seed capital and co-investments (1) $ 1,125.6 $ 956.0 ____________ (1) Included in the total seed and co-investment balance as of December 31, 2024 is $414.0 million of seed capital and $711.6 million of co-investments (December 31, 2023: $314.1 million of seed capital and $641.9 million of co-investments).
GAAP measures are Operating revenues (and by calculation, Gross revenue yield on AUM), Operating income, Operating margin, Net income/(loss) attributable to Invesco and Diluted EPS. Each of these measures is discussed more fully below.
GAAP measures are Operating revenues (and by calculation, Gross revenue yield on AUM), Operating income, Operating margin, Net income/(loss) attributable to Invesco and Diluted EPS. Each of these measures is discussed more fully below. The following are reconciliations of the U.S. GAAP measures to the non-GAAP measures. The non-GAAP measures should not be considered as substitutes for any U.S.
GAAP basis $ (434.8) $ 1,317.7 $ 1,788.2 Invesco Great Wall (2) 201.9 262.7 276.6 CIP (3) 84.8 65.7 67.7 Transaction, integration and restructuring (4) 41.6 21.2 (65.9) Amortization and impairment of intangible assets (5) 1,298.8 63.8 62.9 Compensation expense related to market valuation changes in deferred compensation plans (6) 41.2 (46.3) 53.1 General and administrative (7) (20.0) (70.0) — Adjusted operating income $ 1,213.5 $ 1,614.8 $ 2,182.6 Operating margin (8) (7.6) % 21.8 % 25.9 % Adjusted operating margin (9) 28.2 % 34.8 % 41.5 % 47 Ta ble of Contents Reconciliation of Net income/(loss) attributable to Invesco to Adjusted net income attributable to Invesco: (in millions, except per common share data) 2023 2022 2021 Net income/(loss) attributable to Invesco Ltd., U.S.
GAAP basis $ 832.1 $ (434.8) $ 1,317.7 Invesco Great Wall (2) 163.3 201.9 262.7 CIP (3) 60.2 84.8 65.7 Transaction, integration and restructuring (4) — 41.6 21.2 Amortization and impairment of intangible assets (5) 44.8 1,298.8 63.8 Compensation expense related to market valuation changes of deferred compensation liabilities (6) 70.2 41.2 (46.3) One-time acceleration of compensation expense for currently outstanding Long-term awards (7) 147.6 — — General and administrative (8) 52.5 (20.0) (70.0) Adjusted operating income $ 1,370.7 $ 1,213.5 $ 1,614.8 Operating margin (9) 13.7 % (7.6) % 21.8 % Adjusted operating margin (10) 31.1 % 28.2 % 34.8 % 48 Table of Contents Reconciliation of Net income/(loss) attributable to Invesco to Adjusted net income attributable to Invesco: (in millions, except per common share data) 2024 2023 2022 Net income/(loss) attributable to Invesco Ltd., U.S.
Such requirements may change from time-to-time as additional guidance is released based on a variety of factors, including balance sheet composition, assessment of risk exposures and governance, and review from regulators.
Other Items Certain of our subsidiaries are required to maintain minimum levels of regulatory capital, liquidity, and working capital. Such requirements may change from time-to-time as additional guidance is released based on a variety of factors, including balance sheet composition, assessment of risk exposures and governance, and review from regulators.
Operating Revenues and Net Revenues The main categories of revenues, and the dollar and percentage change between the periods, are as follows: Variance Years ended December 31, 2023 vs 2022 2022 vs 2021 (in millions) 2023 2022 2021 $ Change % Change $ Change % Change Investment management fees $ 4,106.0 $ 4,358.4 $ 4,995.9 $ (252.4) (5.8) % $ (637.5) (12.8) % Service and distribution fees 1,374.6 1,405.5 1,596.4 (30.9) (2.2) % (190.9) (12.0) % Performance fees 46.7 68.2 56.1 (21.5) (31.5) % 12.1 21.6 % Other 189.1 216.8 246.1 (27.7) (12.8) % (29.3) (11.9) % Total operating revenues $ 5,716.4 $ 6,048.9 $ 6,894.5 $ (332.5) (5.5) % $ (845.6) (12.3) % Revenue Adjustments: Investment management fees $ (766.4) $ (764.7) $ (844.1) $ (1.7) 0.2 % $ 79.4 (9.4) % Service and distribution fees (911.7) (961.1) (1,087.5) 49.4 (5.1) % 126.4 (11.6) % Other (147.1) (160.4) (217.7) 13.3 (8.3) % 57.3 (26.3) % Total Revenue Adjustments (1) (1,825.2) (1,886.2) (2,149.3) 61.0 (3.2) % 263.1 (12.2) % Invesco Great Wall 368.3 432.7 473.5 (64.4) (14.9) % (40.8) (8.6) % CIP 51.2 49.6 42.4 1.6 3.2 % 7.2 17.0 % Net revenues (2) $ 4,310.7 $ 4,645.0 $ 5,261.1 $ (334.3) (7.2) % $ (616.1) (11.7) % _________ (1) Total revenue adjustments remove pass through investment management, service and distribution, and other revenues and equal the same amount as the Third-party distribution, service and advisory expenses.
Operating Revenues and Net Revenues The main categories of revenues, and the dollar and percentage change between the periods, are as follows: Years ended December 31, 2024 vs 2023 2023 vs 2022 (in millions) 2024 2023 2022 $ Change % Change $ Change % Change Investment management fees $ 4,342.3 $ 4,106.0 $ 4,358.4 $ 236.3 5.8 % $ (252.4) (5.8) % Service and distribution fees 1,479.7 1,374.6 1,405.5 105.1 7.6 % (30.9) (2.2) % Performance fees 46.4 46.7 68.2 (0.3) (0.6) % (21.5) (31.5) % Other 198.6 189.1 216.8 9.5 5.0 % (27.7) (12.8) % Total operating revenues $ 6,067.0 $ 5,716.4 $ 6,048.9 $ 350.6 6.1 % $ (332.5) (5.5) % Revenue Adjustments: Investment management fees $ (816.6) $ (766.4) $ (764.7) $ (50.2) 6.6 % $ (1.7) 0.2 % Service and distribution fees (1,048.8) (911.7) (961.1) (137.1) 15.0 % 49.4 (5.1) % Other (160.2) (147.1) (160.4) (13.1) 8.9 % 13.3 (8.3) % Total Revenue Adjustments (1) (2,025.6) (1,825.2) (1,886.2) (200.4) 11.0 % 61.0 (3.2) % Invesco Great Wall 318.1 368.3 432.7 (50.2) (13.6) % (64.4) (14.9) % CIP 41.0 51.2 49.6 (10.2) (19.9) % 1.6 3.2 % Net revenues (2) $ 4,400.5 $ 4,310.7 $ 4,645.0 $ 89.8 2.1 % $ (334.3) (7.2) % _________ (1) Total Revenue Adjustments remove pass through investment management fees, service and distribution fees, and other revenues and equal the same amount as the Third-party distribution, service and advisory expenses.
The increase was primarily due to a $1,248.9 million non-cash impairment of our indefinite-lived intangible assets related to prior acquisitions of management contracts of U.S. retail mutual funds.
The year ended December 31, 2023 included a $1,248.9 million non-cash impairment of our indefinite-lived intangible assets related to management contracts of U.S. retail mutual funds.
The company actively manages liquidity risk by preparing cash flow forecasts for future periods, reviewing them regularly with senior management, maintaining a committed credit agreement, scheduling significant gaps between major debt maturities and engaging external financing sources in regular dialogue. Effects of Inflation Inflation can impact our organization primarily in two ways.
The company is exposed to liquidity risk through its $890.6 million in total debt. The company actively manages liquidity risk by preparing cash flow forecasts for future periods, reviewing them regularly with senior management, maintaining a committed revolving credit agreement, scheduling significant gaps between major debt maturities and engaging external financing sources in regular dialogue.
While the company believes all assumptions utilized in our assessment are reasonable and appropriate, changes in these estimates could produce different fair value amounts which could drive impairment in future periods.
Headroom increased from the prior year due to favorable market conditions and a decrease in the discount rate. While the company believes all assumptions utilized in our assessment are reasonable and appropriate, changes in these estimates could produce different fair value amounts which could drive impairment in future periods.
Adjusted operating income decreased to $1,213.5 million for the year ended December 31, 2023 from $1,614.8 million in the year ended December 31, 2022. Adjusted operating margin decreased to 28.2% for the year ended December 31, 2023 from 34.8% for the year ended December 31, 2022.
Adjusted operating income increased to $1,370.7 million for the year ended December 31, 2024 from $1,213.5 million for the year ended December 31, 2023. Adjusted operating margin increased to 31.1% for the year ended December 31, 2024 from 28.2% for the year ended December 31, 2023.
Operating margin (operating income divided by operating revenues) decreased to (7.6%) for the year ended December 31, 2023 from 21.8% in the year ended December 31, 2022 primarily as a result of the $1,248.9 million intangible asset impairment in 2023.
Operating margin (operating income divided by operating revenues) increased to 13.7% for the year ended December 31, 2024 from (7.6)% in the year ended December 31, 2023. The operating loss for the year ended December 31, 2023 was primarily due to the $1,248.9 million intangible asset impairment as discussed above.
(2) Unusual or otherwise non-recurring gains and losses, as defined in our credit agreement, are adjusted for in the determination of Covenant Adjusted EBITDA. The insurance recoveries related to the OppenheimerFunds acquisition-related matter are considered unusual and have been removed from the determination of Covenant Adjusted EBITDA.
(2) Unusual or otherwise non-recurring gains and losses, as defined in our revolving credit agreement, are adjusted for in the determination of Covenant Adjusted EBITDA.
Excluding the intangible asset impairment, Operating expenses increased $171.1 million. Third-Party Distribution, Service and Advisory Third-party distribution, service and advisory expenses include periodic “renewal” commissions which are paid to brokers and independent financial advisors for servicing of their client accounts while they are invested in an Invesco product.
Excluding the intangible asset impairment charge for the year ended December 31, 2023 and the acceleration of Employee compensation expense for the year ended December 31, 2024, Operating expenses for the year ended December 31, 2024 increased $185.0 million as compared to the year ended December 31, 2023. 44 Table of Contents Third-Party Distribution, Service and Advisory Third-party distribution, service and advisory expenses include periodic “renewal” commissions which are paid to brokers and independent financial advisors for providing services to their client accounts while they are invested in an Invesco product.
The increase in interest income was primarily a result of newly consolidated investment products in 2023 as well as higher net interest income earned by the CLOs.
The decrease in net interest income was primarily a result of newly consolidated investment products in the year ended December 31, 2023 which were deconsolidated in the year ended December 31, 2024 as well as lower net interest income earned by the CLOs.
Purchase obligations represent fixed-price contracts, which are either non-cancelable or cancellable with a penalty. As of December 31, 2023, the company's purchase obligations totaled $663.5 million (December 31, 2022: $770.7 million) and primarily reflect standard service contracts for portfolio, market data, office-related services and third-party marketing and promotional services.
As of December 31, 2024, the company's purchase obligations totaled $694.4 million (December 31, 2023: $663.5 million) and primarily reflect standard service contracts for portfolio, market data, office-related services and third-party marketing and promotional services.
The adjustment to net income for the Net income/(loss) attributable to noncontrolling interests in consolidated entities represent the CIP profit or loss attributable to third-party investors.
Net impact of CIP and related noncontrolling interests in consolidated entities The adjustment to Net income for the Net income/(loss) attributable to noncontrolling interests in consolidated entities removes the income/(expense) of CIP which is attributable to third-party investors.
GAAP gross revenue yield 40.4 44.5 48.7 Net revenue yield ex performance fees ex QQQ (2) 32.4 35.5 39.1 Active net revenue yield ex performance fees 37.7 40.7 44.0 Passive net revenue yield ex QQQ (2) 16.0 18.1 20.1 ____________ (1) U.S. GAAP g ross revenue yield is not considered a meaningful effective fee rate measure.
GAAP gross revenue yield 37.4 40.4 44.5 Net revenue yield ex performance fees ex QQQ (2) 30.2 32.4 35.5 Active net revenue yield ex performance fees 36.9 37.7 40.7 Passive net revenue yield ex QQQ (2) 14.9 16.0 18.1 ____________ (1) U.S. GAAP g ross revenue yield on AUM is equal to U.S.
Employee staff benefit plan costs and payroll taxes are also included in Employee compensation. Employee compensation was $1,885.8 million for the year ended December 31, 2023 as compared to $1,725.1 million for the year ended December 31, 2022.
Employee Compensation Employee compensation includes salary, cash bonuses and long-term incentive plans designed to attract and retain the highest caliber employees. Employee staff benefit plan costs and payroll taxes are also included in Employee compensation. Employee compensation was $2,014.2 million for the year ended December 31, 2024 as compared to $1,885.8 million for the year ended December 31, 2023.
Investment Management Fees Investment management fees were $4,106.0 million for year ended December 31, 2023 as compared to $4,358.4 million for year ended December 31, 2022 as a result of shifts in the asset mix to lower yield products as compared to the prior year.
Investment Management Fees Investment management fees were $4,342.3 million for the year ended December 31, 2024 as compared to $4,106.0 million for the year ended December 31, 2023 as a result of higher average AUM partially offset by the shift in AUM toward lower yield products.
Marketing Marketing expenses include the cost of direct advertising of our products through trade publications, television and other media, and public relations costs, such as the marketing of the company's products through conferences or other sponsorships, and the cost of marketing-related employee travel.
Marketing Marketing expenses include the cost of direct advertising of our products through trade publications, television and other media, and public relations costs, such as the marketing of the company's products through conferences or other sponsorships. Marketing expenses were $81.3 million for the year ended December 31, 2024 as compared to $82.1 million for the year ended December 31, 2023.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeSecurities Market Risk The company's exposure to market risk from financial instruments measured at fair value arises primarily from its investments.
Biggest changeAs such, the impact on operating margin or net income of a decline in the market values of AUM may be greater than the percentage decline in the market value of AUM. 59 Table of Contents Securities Market Risk The company's exposure to market risk from financial instruments measured at fair value arises primarily from its investments.
Dollar floating and fixed rate obligations. The sensitivity of our financial assets to interest rate risk is immaterial. Foreign Exchange Rate Risk The company has transactional currency exposures that occur when any of the company’s subsidiaries receive or pay cash in a currency different from its functional currency.
Dollar floating and fixed rate obligations. The sensitivity of our financial assets to interest rate risk is immaterial. 60 Table of Contents Foreign Exchange Rate Risk The company has transactional currency exposures that occur when any of the company’s subsidiaries receive or pay cash in a currency different from its functional currency.
The interest rate profile of the financial liabilities of the company on December 31 was: (in millions) December 31, 2023 December 31, 2022 Debt Fixed rate $ 1,489.5 $ 1,487.6 Floating rate — — Total $ 1,489.5 $ 1,487.6 Weighted average interest rate percentage 4.3 % 4.2 % Weighted average period for which rate is fixed in years 6.0 7.0 See Item 8, Financial Statements and Supplementary Data, Note 8, “Debt,” for additional disclosures relating to the U.S.
The interest rate profile of the financial liabilities of the company on December 31 was: (in millions) December 31, 2024 December 31, 2023 Debt Fixed rate $ 890.6 $ 1,489.5 Floating rate — — Total $ 890.6 $ 1,489.5 Weighted average interest rate percentage 4.6 % 4.3 % Weighted average period for which rate is fixed in years 8.9 6.0 See Item 8, Financial Statements and Supplementary Data, Note 8, “Debt,” for additional disclosures relating to the U.S.
The company is exposed to interest rate risk primarily through its external debt and cash and cash equivalent investments. On December 31, 2023, the interest rates on 100.0% of the company's borrowings were fixed for a weighted average period of 6.0 years, and the company had a balance of zero on its floating rate credit agreement.
The company is exposed to interest rate risk primarily through its external debt and cash and cash equivalent investments. On December 31, 2024, the interest rates on 100.0% of the company's borrowings were fixed for a weighted average period of 8.9 years, and the company had a balance of zero on its revolving credit agreement.
Item 8, Financial Statements and Supplementary Data, Note 17, "Geographic Information," c ontains disclosure of revenue by geography. The company is also exposed to foreign currency translation risk on monetary assets and liabilities that are held by subsidiaries in different functional currencies than the subsidiaries' functional currencies. The impact of the revaluation is recorded in the Consolidated Statements of Income.
Item 8, Financial Statements and Supplementary Data, Note 16, "Segment and Geographic Information," c ontains disclosure of revenue by geography. The company is also exposed to foreign currency translation risk on monetary assets and liabilities that are held by subsidiaries in different functional currencies than the subsidiaries' functional currencies.
Such exposure arises from sales or purchases by operating subsidiaries in currencies other than the subsidiaries’ functional currencies. These exposures are not actively managed. The company also has certain investments in foreign operations, whose net assets and results of operations are exposed to foreign currency translation risk when translated into U.S. Dollars upon consolidation into Invesco. A strengthening U.S.
Such exposure arises from sales or purchases by operating subsidiaries in currencies other than the subsidiaries’ functional currencies. These exposures are not actively managed. In addition, the net assets and financial results of the company's foreign operations are exposed to foreign currency translation risk when translated into U.S. Dollars upon consolidation into Invesco. A strengthening U.S.
If a 10% increase or decrease in the fair values of Invesco’s net investments in CIP were to occur, it would result in a corresponding increase or decrease in our Net income attributable to Invesco Ltd. 58 Ta ble of Contents Cash balances invested in money market funds of $927.8 million have been excluded from the table above.
If a 10% increase or decrease in the fair values of Invesco’s net investments in CIP were to occur, it would result in a corresponding increase or decrease in our Net income attributable to Invesco Ltd. Cash balances invested in money market funds of $479.3 million have been excluded from the table above.
At December 31, 2023, $196.7 million of these equity investments are held to hedge economically certain deferred compensation plans in which the company's employees participate. In addition to holding equity investments, the company has a total return swap (TRS) to economically hedge certain deferred compensation plans. The notional value of the TRS at December 31, 2023 was $393.0 million.
At December 31, 2024, $219.6 million of these equity investments are held to hedge economically certain deferred compensation plans in which the company's employees participate. In addition to holding equity investments, the company has a total return swap (TRS) to economically hedge certain deferred compensation plan liabilities. The notional value of the TRS at December 31, 2024 was $421.2 million.
The following table summarizes the impact of a 10% increase or decrease in the fair values of these financial instruments: December 31, 2023 (in millions) Fair Value Fair Value assuming 10% increase Fair Value assuming 10% decrease Equity investments (1) $ 272.4 $ 299.6 $ 245.2 Total assets measured at fair value exposed to market risk $ 272.4 $ 299.6 $ 245.2 Net investments in CIP (2) $ 527.4 $ 580.1 $ 474.7 ____________ (1) If such a 10% increase or decrease in fair values were to occur, the change attributable to $272.4 million of these equity investments would result in a corresponding increase or decrease in our pre-tax earnings.
The following table summarizes the impact of a 10% increase or decrease in the fair values of these financial instruments: December 31, 2024 (in millions) Fair Value Fair Value assuming 10% increase Fair Value assuming 10% decrease Equity investments (1) $ 371.2 $ 408.3 $ 334.1 Total assets measured at fair value exposed to market risk $ 371.2 $ 408.3 $ 334.1 Net investments in CIP (2) $ 401.4 $ 441.5 $ 361.3 ____________ (1) If such a 10% increase or decrease in fair values were to occur, the change attributable to $371.2 million of these equity investments would result in a corresponding increase or decrease in our pre-tax earnings.
Net foreign exchange revaluation losses were $0.9 million in 2023 (2022: $2.4 million of gains) and are included in General and administrative expenses and Other gains and losses, net on the Consolidated Statements of Income. 59 Ta ble of Contents
The impact of the revaluation is recorded in the Consolidated Statements of Income. Net foreign exchange revaluation gains and losses were zero in 2024 (2023: $0.9 million of losses) and are included in General and administrative expenses and Other gains and losses, net on the Consolidated Statements of Income. 61 Table of Contents
Certain expenses, including distribution and compensation expenses, may not vary in proportion with the changes in the market value of AUM. As such, the impact on Operating margin or net income of a decline in the market values of AUM may be greater or less than the percentage decline in the market value of AUM.
Certain expenses, including distribution and compensation expenses, may not vary in proportion with the changes in the market value of AUM.
Increases or decreases in the fair value of these investments will therefore have no impact to our pre-tax earnings. Interest Rate Risk Interest rate risk relates to the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates.
These are valued under the market approach at the NAV of the underlying funds, which is maintained at $1. Interest Rate Risk Interest rate risk relates to the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates.
Removed
These are valued under the market approach at the NAV of the underlying funds, which is maintained at $1. Assets held for policyholders of $393.9 million have also been excluded from the table above.
Removed
The entity holds assets that are managed for its clients on its balance sheet with an equal and offsetting liability to the policyholders, which is linked to the value of the investments.
Removed
The investments and the Policyholder payables held by this business are carried in the Consolidated Balance Sheets as separate account assets and liabilities at fair value in accordance with ASC Topic 944, “Financial Services - Insurance.” Changes in fair value are recorded and offset to zero in the Consolidated Statements of Income in other operating revenues.

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