New York, July 22, 2022 — Moody’s Investors Service (“Moody’s”) today assigned an initial issuer rating of A2 to Apollo Asset Management, Inc. (“AAM”, and together with its parent company and subsidiaries, ” Apollo”). The outlook is stable.

“Apollo Asset Management’s A2 issuer rating primarily reflects the underlying credit qualities of its operating subsidiaries, including their strong investment performance and high stability of investor capital as well as significant balance sheet liquidity. said Neal M Epstein, CFA, Vice Chairman of Moody’s. and senior loan officer.

The following scoring actions were taken:

..Issuer: Apollo Asset Management, Inc.

…. Long-term issuer rating, assigned to A2

…. Outlook, assigned Stable

RATINGS RATIONALE

Apollo Asset Management’s A2 rating reflects the depth and breadth of its asset management business, the stability of its managed asset base, anchored by perpetual capital vehicles which hold approximately 59% of assets under management of Apollo, and the solidity of its performance over many years. Apollo’s affiliation with Athene Holding Ltd. (“Athene”, Baa1 stable senior unsecured debt), with which it merged in early 2022, provides a significant source of assets under management (AUM), as well as capital to invest in new sources of asset origination giving rise to management and performance fees.

The issuer rating also reflects Apollo’s consolidated credit profile as well as Moody’s expectation that AAM issuances would be backed by guarantees from Apollo Operating Group subsidiaries (“AOG subsidiaries”), which ‘AAM consolidates. Accordingly, AAM’s creditor protections would be indistinguishable from those of the AOG Subsidiaries’ creditors. In the absence of such support, the senior bonds issued by AAM could be rated one notch lower than the senior issues of the AOG subsidiaries, reflecting structural subordination.

The firm’s business is well diversified across three asset management strategies: yield-driven strategies, hybrid strategies and equities. This range of strategies allows Apollo to approach any investment opportunity with comprehensive solutions, as it will have vehicles capable of containing the range of securities that may arise to deal with quality, structured, buyout or difficulty. The products the firm manages are distributed globally, through a range of institutional, sovereign and family office investors.

AAM’s income is derived from fees received for the management of client assets (“Fee Related Earnings”), including from Athene, as well as returns on its own invested capital, including performance incentives (“Principal Investing Income”). The company has increased its capital base with external vehicles that allow third parties to effectively co-invest with Apollo, as well as developing syndication capabilities that distribute investments to other investors. It is developing new capabilities to provide asset management to high net worth clients.

The rating takes into account performance risks that can potentially give rise to earnings volatility from the primary investment income, but these risks are mitigated by Apollo’s long-term investment horizons and historical skill in managing. distressed investments. Moody’s discounts performance-related income by deriving our view of financial leverage.

AAM’s financial profile reflects both a leverage of approximately 1.8x EBITDA (as adjusted by Moody’s) and its large balance sheet deployment in fund management vehicles. However, to a large extent, these deployments represent accrued incentive costs, which are accounted for as business investments until they are crystallized and distributed. Athene’s $750 million annual dividend payment to Apollo Global Management, the parent entity of AAM and Athene, supports Apollo’s liquidity.

The assignment of the new ratings to Apollo Asset Management, Inc. considers its governance as part of Moody’s environmental, social and governance considerations. Its risk management, policies and procedures are consistent with industry best practices. The company’s financial position is solid and management is used to meeting its business objectives. Although it has a strong enterprise risk management framework, its governance risk is negatively impacted by its ownership by Apollo Global Management.

OUTLOOK

AAM’s stable outlook reflects the strong financial performance of its subsidiaries and we expect it to maintain healthy financial leverage and a significant financial buffer for at least the next two years.

FACTORS THAT MAY LEAD TO AN IMPROVEMENT OR DEGRADATION OF THE RATING

Moody’s could upgrade Apollo Asset Management’s rating if leverage was kept below 1.0x, as measured by debt/EBITDA, including Moody’s adjustments, if the revenue scale exceeded $5.5 billion and if a growing range of capabilities were to result in lasting improvements in market position.

Conversely, Moody’s could downgrade AAM’s rating if debt/EBITDA were to exceed 2.5x for two or more quarters, if the company were to experience a decline in the revenue scale below 3, $0 billion, accompanied by a weakening of other indicators of market position and an erosion of its pre-tax margins, and if the cumulative losses on investments were to weaken AAM’s balance sheet.

The main methodology used in this rating is the Asset Managers methodology published in November 2019 and available on https://ratings.moodys.com/api/rmc-documents/65403. Otherwise, please see the Scoring Methodologies page on https://ratings.moodys.com for a copy of this methodology.

Apollo was founded in 1990, and AAM operates primarily in the United States through two reportable segments: Asset Management and Principal Investing. As of March 31, 2022, its total AUM was $512.8 billion.

REGULATORY INFORMATION

For details on key rating assumptions and Moody’s sensitivity analysis, see the Methodological Assumptions and Sensitivity to Assumptions sections in the Disclosure Form. Moody’s rating symbols and definitions can be found at https://ratings.moodys.com/rating-definitions.

For ratings issued on a program, series, category/class of debt or security, this announcement provides certain regulatory information regarding each rating of a subsequently issued bond or note of the same series, category/class of debt, security or under a program for which ratings are derived exclusively from existing ratings in accordance with Moody’s rating practices. For ratings issued on a media provider, this announcement provides certain regulatory information relating to the credit rating action on the media provider and each particular credit rating action for securities whose credit ratings are derived from the support provider’s credit rating. For the provisional ratings, this press release provides certain regulatory information relating to the provisional rating assigned, and to a final rating that may be assigned after the final issuance of the debt, in each case where the structure and conditions of the transaction n have not changed prior to the final rating being assigned in a way that would have affected the rating. For more information, please see the issuer/transaction page of the respective issuer at https://ratings.moodys.com.

For all relevant securities or rated entities receiving direct credit support from the lead entity(ies) of this credit rating action, and whose ratings may change as a result of this credit rating action , the associated regulatory information will be that of the guarantor entity. Exceptions to this approach exist for the following disclosures, if applicable to the jurisdiction: Ancillary services, Disclosures to the rated entity, Disclosures to be provided by the rated entity.

The rating has been communicated to the rated entity or its designated agent(s) and issued without modification as a result of such communication.

This rating is requested. Please refer to Moody’s Policy for the Designation and Assignment of Unsolicited Credit Ratings available on its website. https://ratings.moodys.com.

The regulatory information contained in this press release applies to the credit rating and, if applicable, the outlook or rating revision relating thereto.

Moody’s general principles for assessing environmental, social and governance (ESG) risks in our credit analysis are available at https://ratings.moodys.com/documents/PBC_1288235.

At least one ESG consideration was material to the announced credit rating metric(s) described above.

The worldwide credit rating on this credit rating announcement was issued by one of Moody’s affiliates outside the EU and is approved by Moody’s Deutschland GmbH, An der Welle 5, Frankfurt am Main. -le-Main 60322, Germany, in accordance with Article 4(3) of Regulation (EC) No 1060/2009 on credit rating agencies. Further information on the EU approval status and the Moody’s office that issued the credit rating can be found at https://ratings.moodys.com.

The worldwide credit rating on this credit rating announcement has been issued by one of Moody’s affiliates outside the UK and is approved by Moody’s Investors Service Limited, One Canada Square, Canary Wharf, London E14 5FA under the law applicable to credit rating agencies in the United Kingdom. . Further information on the UK endorsement status and the Moody’s office that issued the credit rating can be found at https://ratings.moodys.com.

Please see https://ratings.moodys.com for any updates on changes to the lead rating analyst and Moody’s legal entity that issued the rating.

Please see the issuer/transaction page at https://ratings.moodys.com for additional regulatory information for each credit rating.

Neal M. Epstein, CFA
VP – Senior Credit Officer
Funds and Asset Management Group
Moody’s Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
UNITED STATES
JOURNALISTS: 1 212 553 0376
Customer service: 1 212 553 1653

Robert M. Callagy
Associate General Manager
Funds and Asset Management Group
JOURNALISTS: 1 212 553 0376
Customer service: 1 212 553 1653

Release Office:
Moody’s Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
UNITED STATES
JOURNALISTS: 1 212 553 0376
Customer service: 1 212 553 1653