US insurers’ bank loan investments increase to $122bn

Written by Adam Cadle

17/07/2024

US insurers’ bank loan investments increased to about $122bn in BACV at year-end 2023 from $117bn at year-end 2022, the NAIC has revealed.

Despite the 4.6% growth, bank loans remained at 1.4% of US insurers’ total cash and invested assets at year-end 2023 – the same as year-end 2022.

Around 70% of US insurers’ bank loan investments were acquired, and 85% were held by life companies. In particular, large life companies, or those with more than $10bn in assets under management, accounted for 82% of US insurers’ bank loan exposure, up from nearly 80% in 2022.

The top 25 insurance companies accounted for 75% of US insurers’ total bank loan investments at year-end 2023; the top 10 accounted for about 60%.

Improvement in credit quality for US insurer-bank loans continued, evidenced by a four percentage-point increase in those carrying NAIC 1 and NAIC 2 designations and a corresponding four-percentage-point decrease in bank loans carrying NAIC 3 and NAIC 4 designations.

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