Apollo Global lent a record $114 billion in the third quarter, driven by insurer premiums funneled into the AI financing boom. Lending volumes surged over 50% from the prior quarter, including a major chip-financing deal for Anthropic and a $500 billion effort for Nvidia. The New York-based private capital group now has lent more than $350 billion over the past 12 months, nearly a third more than the year before, rivaling large commercial banks like HSBC and Citigroup.
Apollo funds lending through premiums from insurance clients, primarily its in-house life insurer Athene. The firm aims to earn a spread of 0.3% to 0.4% above high-rated corporate bonds via asset-backed loans. Beyond AI, Apollo extended large loans in the quarter to a US pipeline network in Oklahoma, German pharmaceutical conglomerate Bayer, and the New York Yankees.
While some rivals avoid lending against AI chips due to underwriting concerns, Apollo has emerged as a key lender to big technology groups. However, quarterly results were mixed, with higher interest rates and competition causing activity to fall short of Wall Street forecasts. The firm wrote down its $1 trillion portfolio by $3.2 billion and saw insurance spread profits decline.
Quarterly inflows fell to $19 billion, the lowest this year, as Apollo is on track to attract about $80 billion in new insurance cash this year, marking the end of rapid growth. A net loss of $1 billion was recorded overall, though adjusted net income was $1.3 billion, slightly below expectations.
Source: Financial Times Companies · Summarized by HeadlinesBriefing