Good morning, and welcome to Apollo Global Management's Third Quarter 2025 Earnings Conference Call. [Operator Instructions] This conference call is being recorded. This call may include forward-looking statements and projections, which do not guarantee future events or performance. Please refer to Apollo's most recent SEC filings for risk factors related to these statements. Apollo will be discussing certain non-GAAP measures on this call, which management believes are relevant in assessing the financial performance of the business. These non-GAAP measures are reconciled to GAAP figures in Apollo's earnings presentation, which is available on the company's website. Also note that nothing on this call constitutes an offer to sell or a solicitation of an offer to purchase an interest in any Apollo Fund. I will now turn the call over to Noah Gunn, Global Head of Investor Relations.

Thanks, operator, and welcome again, everyone, to our call. Joining me to discuss our results and the momentum we're seeing across the business are Marc Rowan, CEO; Jim Zelter, President; and Martin Kelly, CFO. Earlier this morning, we published our earnings release and financial supplement on the Investor Relations portion of our website. As you can see, very strong third quarter results demonstrate the exceptional strength that we are seeing. We generated record combined fee and spread related earnings which drove adjusted net income of $1.4 billion or $2.17 per share, up 17% year-over-year. In addition to the rich commentary, we prepared for you on this morning's call, we'd like to announce that we will be hosting an extended fixed income call session for Athene this quarter on November 24. And with that, I'll hand it over to Marc.

Thanks, Noah, and good morning. It's a pleasure to be here today and delivering good news is especially fun for me. Results in the third quarter were exceptionally strong. FRE of $652 million was up 23% year-over-year, management fee growth of 22% year-over-year, ACS fees of $212 million, our second straight quarter in excess of $200 million. SRE ex notables $846 million. And for those of you who are focused on SRE and like estimates, we estimate that SRE in Q4 will be approximately $880 million, which will drive estimated full year SRE on a comparable basis to $3.475 billion, approximately 8% year-over-year growth, which will be above the mid-single-digit target we provided earlier. Financial results are the product of underlying good fundamentals. The most interesting and most important fundamental for us is origination. We believe origination is the lifeblood of our business. Origination for this quarter was very strong. $75 billion of origination led by platforms. It's our second strongest quarter following a record Q2. Average spread on our origination, 350 basis points over treasuries, which was stable quarter-over-quarter, average rating of BBB. The reward for good origination is people want to invest with us. Robust inflows of $82 billion for the quarter, led by asset management of $59 billion, retirement services of $23 billion. In the asset management number is $34 billion from Bridge. So inflows ex Bridge, $26 billion. Record AUM at the end of the quarter, $908 billion, up 24% year-over-year. In short, the growth flywheel is spinning. Jim and I have a lot of opportunities to discuss why the growth flywheel is spinning. We like and we often say it's a result of good management. And I think this quarter, not by Jim and I necessarily, but by the team, team worked very hard and…

Thanks, Marc. Having navigated credit cycles for more than 4 decades, I can tell you we've seen this one before. Isolated incidents are nothing new, and they're rarely a signal of broader stress. As we remain vigilant in our underwriting and risk management efforts, what we're seeing is idiosyncratic, not systematic. Over the years, there has been a propensity to overemphasize short-term technical headlines and overlook the broader direction of travel within our industry. Broad secular forces such as the increasing economic activity generated by private companies, the global industrial renaissance as well as massive capital fueling the global industrial renaissance are driving increased demand for global private credit, in particular, investment grade. At the same time, demographics and the expanding needs of retirees globally are driving the secular demand. This is the foundation of our business. We've leaned into senior secured top of the capital structure investments to serve a market that we believe exceeds $40 trillion. As you can see from our growth, that has served us well, and we are just beginning to scratch the surface. Recent events give us a moment to step back and reflect on the marketplace, and I believe there is an important point to be made here, whether a particular transaction is public or private is simply the manner in which the risk is originated. Ultimately, it is not the litmus test for credit quality. Our disciplined underwriting as an origination principle, not an agent or a tourist across both public and private markets has allowed us to be trusted stewards of our investors' capital through various market cycles and position us for continued success. We look forward to leading and performing in a marketplace with a dispersion of returns. On origination, let me put the quarter and the origination engine in…

Thanks, Jim. Good morning, everyone. Our third quarter results highlight clearly the accelerating momentum across our platform, reaffirming our ability to execute consistently on our long-term plan. I'll take a few minutes to walk through the quarter's financial performance and discuss the key factors supporting our progress as we close out the year. I'll then share more details on the outlook for 2026 to supplement Marc's comments. In asset management, we generated an increase in both assets under management and fee-generating assets under management of 24% year-over-year to $908 billion and $685 billion, respectively. We generated fee-related earnings of $652 million in the quarter and $1.8 billion year-to-date, up 20% year-over-year in each quarter this year versus the comparable period, evidence of the momentum across the platform and keeping us firmly on pace for a full year growth rate of 20%. In the quarter, we delivered 22% year-over-year growth in management fees, driven by third-party asset management inflows and record gross capital deployment, particularly across our credit platform as well as strong growth from retirement services. Capital Solutions fees of $212 million, as highlighted, represent our second strongest quarter on record. The breadth of origination capabilities was very clear this quarter, with 50% of ACS fees generated by our hybrid value, opportunistic equity, climate transition and real estate businesses, complementing the other 50% from our high-grade and global credit businesses, including Atlas. We generated 28% year-over-year growth in fee-related performance fees, reflecting sustained growth in spread-based income across a variety of our perpetual capital vehicles, led by ADS and complemented by Redding Ridge and MidCap among other platforms. Growth in fee-related expenses reflects continued investment in hiring and infrastructure to support the firm's global strategic growth initiatives, compensation growth reflecting our performance this year and the inclusion of Bridge into…

[Operator Instructions] Today's first question is coming from Steve Chubak of Wolfe Research.

So I wanted to start with a discussion just around the origination targets that you unveiled at Investor Day. Annual origination volume of $275 billion, you just reported origination activity at an annualized clip of more than $300 billion. Last quarter's volumes were even better. So taking a step back, as we think about the year-to-date origination strength, which is running ahead of plan, ongoing expansion of origination capabilities with both you, Marc and Jim had discussed in your prepared remarks, has your thinking changed as to whether this is still an appropriate target? And just what informs your outlook over the next few years?

Listen, it's an appropriate question to answer or to ask because we've gotten off to such a strong start. I think taking the view that Marc and management have put forth about origination being the key, I think it really ties into our conversation about how the end universe of buyers has expanded from the alternatives bucket to the other 5 that Marc mentioned. And I think it allows us in terms of broader product creation and broader solutions to investors and retirees. But it would be premature while we're very happy with the accelerated success. And while we see tremendous wins to our back in terms of the solutions we're providing, it'd be a mistake to change our 5-year estimates 9 to 12 months into the plan. So great momentum. We feel this is by no means are we having early wins that are going to take away from future gains. So it is a trajectory. But on this call, we're not prepared to put a new estimate for a 5-year number. But I do think -- and Martin tied into it, I think it's all about the flywheel. 75% of our growth next year is from existing vehicles, existing funds, existing strategies, which is the flywheel of origination. So it gives us greater confidence in our ability about the excess of 20% FRE growth in the coming years.

The next question is coming from Alex Blostein of Goldman Sachs.

I wanted to start with a question around the wealth market for Apollo broadly. A couple of really strong quarters, $5 billion of flows in the third quarter. You talked about the new product pipeline. And Marc, I was intrigued by your comments around the asset management partnerships broadly. So maybe you could expand a little bit on how you view this $5 billion trajectory from here? How much is likely to come from new products or the existing lineup? And when it comes to the sort of asset management partnerships, maybe expand on what that could look like for Apollo over the next couple of years.

Alex, let me just start out by saying, as you point out, so when we did our Investor Day last fall, we talked about $150 billion within the 5 years in aggregate. So we're still on that pace. But -- and I'll pass along to Marc. But certainly, what we see is the product suite that we've created over the last 24 to 36 months in terms of breadth of products, evergreen, non-traded BDCs, ABC, not only is expanding product set and geographically, but you will see more solutions oriented, but also as we talked about, the 6 channels. And with that, I'll really toss it over to Marc to talk about those 6 channels.

So Alex, think about the following. In the Global Wealth business, at the top end of the Global Wealth business is our family offices. We, Apollo and we as an industry have elected to cover these accounts directly and interact with them directly. The next tier down, if you will, in Global Wealth are high net worth. And this -- the definition of high net worth varies from firm to firm. For us, think of a client that is worth a financial intermediary, an RIA, a wealth manager advising well. We cover these accounts indirectly by covering the RIA and by covering the wealth manager, but do not cover for the most part, the individual account. We've just talked about a fraction of a fraction of the marketplace because the vast majority of clients are neither high net worth nor are they family offices. Our industry and ourselves, we do not cover these accounts. And it is my belief and the strategy we're pursuing is not to try and cover these accounts. They are already well covered by their traditional asset management managers. They already have a relationship. In many instances, they are not likely to buy 100% private products, either from lack of knowledge, lack of suitability or lack of available liquidity. I believe that they are going to get exposure to private assets through their traditional asset manager. You watched what we've done with State Street, what we're doing with Lord Abbett, what others in our industry have done. I believe that you will see a significant uptick in the partnerships, which will not just be new products, you will start to see private assets added to in-place exposures. That will be the fastest uptick in the wealth market as far as we're concerned. And I think it's…

The next question is coming from Patrick Davitt of Autonomous Research.

I'm sure you've seen, but Colm Kelleher is on the tape this morning warning on private letter ratings arbitrage in U.S. insurance being "looming systemic risk." Firstly, what are your thoughts on that view? And then perhaps more specifically to Athene, can you remind us to what extent Athene is using similar private letter ratings in its own portfolio?

First, Colm is one of the most respected people in the banking industry. I'm sorry, I'm not in Hong Kong this year because normally, I up here right after him, and we like to mix it up in front of the crowd. In my -- this is the background, and I'll speak for Athene and not for the industry. Colm is just wrong. If you look at -- like I'll give you Athene stats. First, Athene does not use Egan-Jones, let's start with that. Less than 8% of our assets have a rating from Kroll or DBRS. 70% of our assets have 2-plus ratings. S&P, Moody's and Fitch each rate 50% of our fixed income assets. Kroll, 18%; DBRS, 15%. By the way, DBRS and Kroll have most of the expertise right now in structured products, and they are doing a good job competitively with Moody's, S&P and Fitch close on their heels. So I don't mean to contrast them from the big 3 that they are any less qualified. But Colm -- I compare the insurance industry to the banking industry. 100% of what is on a bank balance sheet is private credit. Almost nothing has a rating. And so when we talk about private letter ratings, at least it has a rating. Now in our industry, not everyone has done what we've done. And Colm is not wrong to think about and to talk about systemic risk because like the banking industry, you have really strong players and you have really weak players. In the insurance industry, you have really strong players and really weak players. I do not believe that private letter ratings are where the focus should be. I continue to believe, as I've said previously, that we have offshore jurisdictions of significant size that have…

The next question is coming from Bill Katz of TD Cowen.

I just want to circle back on the wealth management opportunity. One of the pushbacks we get for Apollo and the industry at large is just as rates come down, the demand for yield or income will come down and the industry will suffer from rotation risk. I was wondering if you could address what you're sort of seeing and how you think about that. And then as you look out to 2026, I wonder if you could just lay out a little bit more detail the road map in terms of what drives the incremental growth from here.

So -- it's Marc. I'm going to start with a bit of a philosophical and then I'm going to hand it to Jim, who really will delve into a little bit more specific. Private lending was a better business 4 years ago and 3 years ago and 2 years ago and last year. By the way, I wish I owned Nvidia 4 years ago and 3 years ago and 2 years ago and last year. This is fundamentally what people fail to understand. The rotation into private credit is a rotation out of equity. That is what investors are doing. That is what we observe. They are making a decision to take risk off because they perceive the ability to earn long-run equity returns in first lien debt top of the capital structure as an attractive opportunity, but I think we cannot, as an industry, deny that there was more value just like there was more value in the equity market. We're now talking about where we sit in the valuation cycle and the alternatives that we provide. As I suggested, we believe that prices are high, that rates -- long rates are not likely to plummet and that we have enhanced geopolitical risk. And so as a firm, we are in risk reduction mode. We preach risk reduction. Our balance sheet is in risk reduction mode. And what we see in terms of flows into private credit in a traditional sense, private credit in the form of levered lending reflects investors who are reducing risk and moving money out of equity and into private credit vehicles.

Yes. And I'll add, Bill. Obviously, I agree with Marc's comments. But again, I think a lot of those are to the narrow definition of direct lending with sponsors, which while compressed still versus the safe public markets is still a very wide spread. You're doing -- getting SOFR 450, 500 versus the classic high-yield index inside of 250 over, you're still getting a fair return. And again, I think the mistake that people are making is the tactical or technicals in the recent market versus the secular change. I just got back from a 2.5-week 9-country tour. Everywhere I went, there was massive need for evergreen compounding retirement income. And that is such a large number. It overwhelms the $1.6 trillion direct lending market. And again, we just find country after country, region after region, the ability to generate high-quality compounding robust yield is a secular trend. And especially as the rates have gone up over the last 5 to 7 years, as more pensions are fully funded, they're going through a variety of immunization strategies. So yes, on the margin, not as attractive as it might have been 24, 36 months ago. That's why we've been preaching top of the capital structure, no PIK, less software, et cetera, et cetera, but do not confuse that with the secular tailwinds.

The next question is coming from Craig Siegenthaler of Bank of America.

We wanted to come back to Marc's comments on the 6 markets, including several newish markets like the traditional asset management and the $12 trillion U.S. 40(k) channel. What type of share do you think the alts will eventually take on both the traditional and the 40(k) markets? And also, what investments does not just Apollo, but the entire industry need to make in order to prepare the origination platforms to address this much larger TAM?

So I start with traditional asset managers because I think there is a natural limit. Right now, inside of a number of vehicles, you have a 15% limit. And most of the investors do not bump up against this 15% limit. And so back of the envelope, we think that there is potential, which is different than a forecast of roughly 10% of traditional asset managers. If you look at what some of the traditional asset managers who have been large investors in privates before, they own SpaceX. They own OpenAI. They own a number of the other Stripe. They own a number of the other large-cap growth companies. We have, for a long time, just thought that this applied to this unique network. It doesn't. It will not surprise me to see 20 large industrial companies that stay private for a longer period of time, in addition to all of the credit and other vehicles. And so I think you will get a good sense of this in the first quarter next year as some of the partnerships that are under discussion begin to get announced and begin to get rolled out. And again, the prize for the industry is not just the creation of new products. And we will create new products as we have and as others have. I think it is getting a share of in-place assets as traditional asset managers compete for rate of return and through performance for clients. Almost no one else in the traditional asset management industry has the $35 billion that BlackRock has. If you're watching what BlackRock is doing and you're in a traditional asset management mode, you're looking to figure out how you get private market exposure. I believe they will get private market exposure through partnerships, through relationships. And what we need to do is not just invest in origination. We need to invest in infrastructure. We need to invest in business processes. We need to embrace transparency and disclosure because traditional asset managers will not move in size into the private marketplace unless we can do things like daily NAV, unless we can provide price, unless we can provide liquidity. A whole new set of skills is going to be -- need to be learned by our industry. And I believe that we have a leadership position in this and have embraced this as a methodology of how do we do business going forward.

Yes, Craig, and I would just add that I think many of us in the industry 2, 3 years ago thought that the promise land was just getting our products on their platform, which they would deliver and distribute. And that's worked for some. It's not worked for many. And as Marc mentioned, when BlackRock made their variety of purchases, there's many income funds, there's many total income funds, total return funds that have a basket and I think servicing them in partnership. It's very similar to the bank alternative credit provider. There's a view that it's a black and white war. It's actually much more open architecture. It's much more problem solving together. And this is just one of the many distribution channels that we believe you'll be able to service going forward, just like in a place like a variety of firms that are using models and OCIOs, the ability to cover those folks with actual product solutions as well, not just funds. So it's really a much more open architecture view of how you partner with your origination, which is the scarce attribute.

Our next question is coming from Glenn Schorr of Evercore ISI.

Sorry, one more on this topic because I think it's so interesting. So I'm a believer. I think you infusing some of your private market origination can produce better returns, better diversification, even maybe turn their outflows into inflows for some of these products. My question is, how do you get a traditional manager to give up some of the assets and therefore, some of the fees in order to make this investment and turning around their products or making them more appealing to their investor base?

So Glenn, it's Marc. I'll speak to it. But first, just to -- we were apparently exceptionally long-winded, all 3 of us. So we are going to cut the call at 9:45. Noah tells me. Anyone we miss, we will make it up to you as we go. But I start this way, Glenn. When we cover a client, we cover wealth, we have a massive infrastructure, hundreds of people, lots of expense in doing it. When we cover a traditional, we're essentially leveraging their distribution. The ability of us to provide a portion of our fee, and you heard me say this on this call, is actually margin accretive for us, and it's margin accretive for them. If we can give them good performance and we can turn outflows into inflows or if we can give them a unique client solution, we can give the client another reason to stay with the asset manager. That's a win. And for us, I think we're going to be in a situation where over time, we have excess demand for private assets versus the supply of private assets. And we should be looking at balancing and protecting and diversifying our distribution, but also for distributors who can remove cost on a net basis from our system. We should embrace them and pay them accordingly.

The next question is coming from Ben Budish of Barclays.

Just wondering if you could unpack a few more of the details around the 2026 SRE guide. And how should we be thinking about gross flows, outflows, the level of spread? It sounds like versus at least prior expectations, the decline in spread over the next couple of quarters should be much lower than expected. So any other details you can share a utilization just as we're kind of fine-tuning models after the results?

I'll hit top of the waves, and then I'll turn it to Martin. Recall that this beginning -- the end of last year, beginning of this year, we had 3 unique issues. We were facing rates headwind, a prepay headwind and the roll-off of massively profitable business as a result of business that we put on at COVID. And as Martin suggested, having now dug in and really understood on a much more granular basis where we stand on prepays and where we stand on the roll-off of business and having immunized rates, we just have a much more predictable and much better understanding of where we're going to be on an SRE basis, subject, again, as Martin said, to the vagaries of having a $400 billion balance sheet. What we intend to do is on the 24th is to spend more time on this so that you can help build a model. But just to give you top of the waves again, I don't think much is going to change in terms of ADIP II utilization and gross flows, inflows or outflows.

Yes. I won't say much more given the 24th, but base assumptions remain unchanged. The one other point I think, which is relevant is we're clearly outperforming in '25 relative to the prior guide that we indicated, and that also has a run rate benefit jumping off into 2026. And so we've written this year-to-date almost in 9 months, almost the entire volume that we wrote last year. We will be likely close to but not quite at the 5-year average on top line growth in year 1. And when you pair that with a very strong sort of robust origination environment with the spreads that we've been able to achieve and the rate actions we've taken, that all sort of gets to a more healthy jump-off point into '26 with a sort of similar baseline set of assumptions, and we'll unpack that more.

The next question is coming from John Barnidge of Piper Sandler.

With the capital markets world opening up more and OpenAI moving towards an IPO in '26, do you think this open capital markets environment and those companies moving from the private bucket to the public market will cause a natural inflow of public dollars back into those private assets from those asset managers you mentioned?

It's interesting. The last 6, 8 weeks, Amazon, Google, Meta, Oracle and several others have issued jumbo IG issuance. At the same time, we had a record quarter. These needs are so vast and so great and global that temporary flows into the public IG market, which is a necessary portion of the overall multitrillion funding, it's going to be funded by all markets. When you look at the capital structure in the future, you'll have a company that will have a broadly syndicated facility, they'll have public IG, they'll have private IG. That is the way of the world. And so when a company can and scale issue in the public IG market, they should. But as we've talked about, a company like we announced, whether the 2 that I mentioned on the call, Keurig Dr Pepper or Ørsted, very unique financing needs that the public market solution is not going to check the box. So it's not a black and white winner take all. It's open architecture like you've seen in other financing markets.

The next question is coming from Michael Cyprys of Morgan Stanley.

I wanted to ask about the partnerships with the traditional asset managers that you were alluding to earlier. I was hoping you could elaborate a bit on how you anticipate these partnerships evolving, what the different flavors might look like and what scenario might it make sense to maybe even acquire in some of those types of firms as opposed to partnering? And then if you could just speak to market making around your aspirations and steps you're taking there as you look to support the development of the marketplace.

Mike, I'm just going to mention a few things we've talked about in the past. I mean you know about how we partner with State Street on the ETFs. You know how we've announced our dialogue with Lord Abbett in terms of the short duration vehicle. I think what Marc and I are describing, what our partners are describing is the evolution. It was really like the idea of private direct lending 10 years ago was an augment to how the high yield and loan markets work. It was a third tool. And I think that a lot of questions today about sizing the TAM, sizing. It's too early to be doing that. But what we're really trying to do is to really have folks recognize that the only path to Rome is not only just distributing our ADS and ABC, but there's a variety of open architecture solutions that are going to take place and that are going to be evolving as those PMs and those -- there's a lot of trusted investors in some of those traditional strategies. And so again, I think we're still early days. It's our view that we want to be the leading voice of this. We want to be part of the broader dialogue. And I do think it's going to be about brand and scale. And the commentary about market making, in our experience, our collective 80 years between the 2 of us, every time there's been more transparency, information, price discovery and really putting information at the investors' footsteps, asset classes have grown. I was there in the early days of the high-yield market, the old jump bond market now is the high-yield market. And every asset class that we have seen in the development of that information and dialogue. So I believe that as we think about stablecoins, as we think about tokenization, there's an ecosystem that will evolve, and we intend to be the leading voice and the leading player in that evolution.

The next question is coming from Brennan Hawken of Bank of Montreal.

I just wanted to ask, I know we're going to get into all the components of SRE on the 24th. But on the alt return, you guys restructured the portfolio about a year ago, laid it out at the Investor Day. The returns have gotten better, but they still have run below that 11% level. I know you guys are assuming a return to the 11% for next year and it's part of the outlook. So what has constrained it even despite the restructuring from getting to that 11% and maybe even seeing a few quarters above it, which you would think with an average would happen? And what's the confidence of the progression continuing to eliminate that gap?

So big picture, and we will spend more time on this on the 24th. We have 2 components of the alts portfolio at Athene. By far, the largest component is AAA. AAA is, my recollection, 10.9% LTM. And we're -- in AAA, the returns have been just fine. We do suffer a little bit from cash drag, and we have a relatively healthy pipeline, and we expect the cash drag to come down. And we are optimistic and confident subject to market conditions that we will exceed the bogey there. The other portion of Athene's portfolio of alts, which is outside of AAA, relates to its holdings of other insurance assets, one of which is Venerable, which has, quite frankly, more than exceeded by a wide margin, the 11%. And the second is Athora, where Athora has dragged a little bit because, again, we've been holding a decent amount of excess capital. The deployment of the excess capital into PIC should we be granted regulatory approval, which we expect is highly accretive to the Athora investment, and we would expect to see both categories, insurance and AAA be more in line or exceed target levels of return.

We're showing time for one final question today. The final question will be coming from Brian Bedell of Deutsche Bank.

Maybe just back on the 401(k) theme. I guess, Marc, are you seeing any near-term traction from plan sponsors in thinking about adding privates to their portfolios? I know it's a long-term theme, but just trying to get a sense of if we might see some progress actually this year in the industry. And then also on the deaccumulation side, you've talked about the importance of -- or the opportunity for Athene to make its way into the deaccumulation strategies for retirement plans. Is that something that you might see traction in the next couple of years and begin to generate even some upside to that $85 billion run rate that you're running at now for retirement service inflows?

That's the hope. Look, on the -- we are -- maybe taking them in reverse order, we are very focused on the notion of guaranteed lifetime income. Guaranteed lifetime income is the simple decumulation strategy. It's a journey that, quite frankly, retirees have been on. If you go back in history, they love their defined benefit plan. They knew exactly what they were going to get. The corporations, not so much. And so we kind of put them in a 401(k) self-directed marketplace, and it turns out very few of them actually make a decision. Almost all of them end up in the default option selected by their employer. The ability to offer to them guaranteed lifetime income, but this time not provided by the plan, but provided on a commercial basis by third parties is the holy grail for us. It is what we're focused on. I think we will do this a little bit on the 24th, but probably more likely guaranteed income strategy. Again, not in our 5-year plan, but certainly something we're working on and we believe upside to where we are. The second in 401(k), we continue to see progress in 401(k). As I've mentioned previously on these calls, we've crossed over a couple of billion in the various managed account platforms and others by people looking to do this. Is it in any way like a groundswell? No. Everyone is in the information gathering phase right now. The guidance that the administration has put out in terms of their desire is actually quite helpful. But I don't think we're going to see massive take-up until we end up with either guidance, which would be something that would be able to happen in the relatively short term or a ruling of some sort, which might take a longer period of time. But this is a time for us to be out educating. And Jim and I get all of these call reports. It is among the most important things that we watch and follow.

We actually are showing time for one additional question. Our next question is coming from Wilma Burdis of Raymond James.

How do you think about the trade-off between higher volumes versus higher spreads in this ultra-tight credit spread environment? And how does that change Athene's capital efficiency or ROE?

So I don't know that it's just an Athene issue. I think it's across the board. We are in the excess return per unit of risk. And so it's not just spread absolute. It's spread in various marketplaces. And so to the extent we can earn excess spread at the A level or at the AA level, we have different requirements than we do having it at the BBB or BB level. So we see this across the board. For Athene, where we are the capital at the end of the day that supports this, we do not think it is fundamentally intelligent to grow the business without adequate spread. If you do this, you will be the only one who supports it. The reason we have been trusted with the industry's largest sidecar is because investors know that we will not take volume unless we are earning adequate spread. And you bring back one of the theme that I think Jim and I live with, at the end of the day, we and our entire industry are origination constrained. Now the good news is we're doing any number of things to massively scale origination, and there are a number of very positive trends in the world in that regard. But we should not ignore that we are essentially hostage to origination and our capacity to create excess return per unit of risk. That is the promise of private markets.

And I would just add, I think if you look at the last 5 to 7 years, how we've navigated our securitized product CLO holdings, we've constantly upgraded, and it's with a view of where we are in a credit cycle. Even though we probably would have on a pencil, we'd have a higher ROE owning more BBB and BBs, but we've owned a lot more AAs and As because of the overriding view on credit. So let our actions speak louder than our statements. Thank you all. Look forward to next quarter, and thanks for all your support on the call.

Ladies and gentlemen, this concludes today's event. You may disconnect your lines or log off the webcast at this time, and enjoy the rest of your day.