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KKR is a global investment firm specializing in asset management, capital markets, and insurance services. The company offers a diverse range of financial products and services, including private equity, real assets, credit strategies, and insurance products, catering to both its portfolio companies and third-party clients . KKR's asset management segment is a major revenue driver, with significant earnings from management fees . The firm's capital markets business provides comprehensive capital solutions, while its insurance operations, managed by Global Atlantic, focus on retirement, life, and reinsurance products .
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Asset Management - Manages investments across five business lines, generating revenue through management fees, incentive fees, carried interest, and transaction fees.
- Private Equity - Invests in private companies to drive growth and operational improvements.
- Real Assets - Focuses on investments in infrastructure and real estate.
- Credit and Liquid Strategies - Offers credit investment opportunities and liquid market strategies.
- Capital Markets - Provides capital solutions, including debt and equity financing and securities underwriting.
- Principal Activities - Engages in proprietary investment activities.
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Capital Markets - Provides traditional and non-traditional capital solutions, including arranging debt and equity financing, underwriting securities offerings, and offering capital markets advice to both KKR's portfolio companies and third-party clients.
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Insurance - Operated by Global Atlantic, offers retirement, life, and reinsurance products, earning income through the spread between investment income and policyholder benefits costs.
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Given that you don't expect $400-plus million to be the new quarterly run rate for your Capital Markets business , how do you plan to sustain or grow revenues in that segment, considering its significant contribution this quarter?
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With the potential impacts of tariffs and a trade war on your portfolio companies , what specific measures are you taking to mitigate these risks, especially for sectors that might be negatively affected?
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Regarding your target of 14%-15% pretax ROE for Global Atlantic , given the upfront costs and variability in growth you've mentioned, can you elaborate on the concrete steps you're taking to achieve this target, and whether the 2026 timeline is still realistic?
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Your asset-backed finance business has grown over 40% to $66 billion in AUM , can you provide more details on the credit quality and risk management practices in place, especially considering the rapid expansion in this area?
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In light of the challenges in the real estate market and evolving investor sentiment , how confident are you in scaling your real estate equity platforms, and what strategies are you implementing to address potential headwinds in fundraising and deployment?
Competitors mentioned in the company's latest 10K filing.
- Sponsors of public and private investment funds: Compete for both fund investors and investment opportunities .
- Real estate development companies: Compete for investment opportunities .
- Business development companies (BDCs): Compete for investment opportunities .
- Investment banks: Compete for investment opportunities .
- Commercial finance companies: Compete for investment opportunities .
- Operating companies acting as strategic buyers: Compete for investment opportunities .
- Insurance companies: Compete in the insurance market .
- Reinsurance companies: Compete in the insurance market .
- Other financial institutions offering investment products: Compete in the insurance market .
- Local and regional firms, financial institutions, and sovereign wealth funds: Compete in various countries where KKR invests .
- High net worth individuals, family offices, and state-sponsored entities: Represent new types of fund investors .
- Competitors with greater financial, technical, marketing, and other resources: Pose competitive risks .
- Competitors with longer operating histories, more established relationships, or greater expertise: Pose competitive risks .
- Competitors with higher financial strength, claims-paying, or credit ratings: Compete in the insurance business .
- Competitors using technological advancements and innovation: Compete in distribution, underwriting, recordkeeping, advisory, claims, and operations .
- Competitors with lower management fees, greater fee sharing, or higher performance hurdles: Compete for fund investors .
- Competitors with lower cost of capital and access to funding sources: Compete for investment opportunities .
- Competitors with higher risk tolerances, different risk assessments, or lower return thresholds: Compete for investment opportunities .
- Competitors subject to less regulation or less regulatory scrutiny: Compete with more flexibility .
- New entrants into the investment management business: Increase competition .
- Competitors offering more attractive insurance products or higher commission rates: Compete in the insurance business .