filings.toolsItem 1. Financial Statements
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Item 1. Financial Statements
Invesco Ltd.
Condensed Consolidated Balance Sheets
(Unaudited)
| As of | |||||||||||
| (in millions, except per share data) | September 30, 2023 | December 31, 2022 | |||||||||
| ASSETS | |||||||||||
| Cash and cash equivalents | $ | 1,241.5 | $ | 1,234.7 | |||||||
| Accounts receivable | 645.4 | 801.8 | |||||||||
| Investments | 932.6 | 996.6 | |||||||||
| Assets of consolidated investment products (CIP): | |||||||||||
| Cash and cash equivalents of CIP | 313.6 | 199.4 | |||||||||
| Accounts receivable and other assets of CIP | 257.9 | 203.7 | |||||||||
| Investments of CIP | 8,612.9 | 8,531.4 | |||||||||
| Assets held for policyholders | 408.4 | 668.7 | |||||||||
| Other assets | 764.1 | 860.5 | |||||||||
| Property, equipment and software, net | 586.2 | 561.1 | |||||||||
| Intangible assets, net | 7,100.1 | 7,141.2 | |||||||||
| Goodwill | 8,568.8 | 8,557.7 | |||||||||
| Total assets | $ | 29,431.5 | $ | 29,756.8 | |||||||
| LIABILITIES | |||||||||||
| Accrued compensation and benefits | $ | 733.6 | $ | 860.8 | |||||||
| Accounts payable and accrued expenses | 1,291.6 | 1,314.8 | |||||||||
| Liabilities of CIP: | |||||||||||
| Debt of CIP | 6,981.5 | 6,590.4 | |||||||||
| Other liabilities of CIP | 322.3 | 329.6 | |||||||||
| Policyholder payables | 408.4 | 668.7 | |||||||||
| Debt | 1,489.1 | 1,487.6 | |||||||||
| Deferred tax liabilities, net | 1,613.3 | 1,662.7 | |||||||||
| Total liabilities | 12,839.8 | 12,914.6 | |||||||||
| Commitments and contingencies (See Note 10) | |||||||||||
| TEMPORARY EQUITY | |||||||||||
| Redeemable noncontrolling interests in consolidated entities | 754.1 | 998.7 | |||||||||
| PERMANENT EQUITY | |||||||||||
| Equity attributable to Invesco Ltd.: | |||||||||||
| Preferred shares ($0.20 par value; $1,000 liquidation preference; 4.0 million authorized, issued and outstanding as of September 30, 2023 and December 31, 2022) | 4,010.5 | 4,010.5 | |||||||||
| Common shares ($0.20 par value; 1,050.0 million authorized; 566.1 million shares issued as of September 30, 2023 and December 31, 2022) | 113.2 | 113.2 | |||||||||
| Additional paid-in-capital | 7,442.8 | 7,554.9 | |||||||||
| Treasury shares | (3,010.8) | (3,040.9) | |||||||||
| Retained earnings | 7,658.8 | 7,518.3 | |||||||||
| Accumulated other comprehensive income/(loss), net of tax | (960.6) | (942.4) | |||||||||
| Total equity attributable to Invesco Ltd. | 15,253.9 | 15,213.6 | |||||||||
| Equity attributable to nonredeemable noncontrolling interests in consolidated entities | 583.7 | 629.9 | |||||||||
| Total permanent equity | 15,837.6 | 15,843.5 | |||||||||
| Total liabilities, temporary and permanent equity | $ | 29,431.5 | $ | 29,756.8 |
See accompanying notes.
Invesco Ltd.
Condensed Consolidated Statements of Income
(Unaudited)
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||
| (in millions, except per common share data) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
| Operating revenues: | |||||||||||||||||||||||
| Investment management fees | $ | 1,041.3 | $ | 1,057.3 | $ | 3,102.7 | $ | 3,351.3 | |||||||||||||||
| Service and distribution fees | 353.5 | 340.2 | 1,030.0 | 1,073.0 | |||||||||||||||||||
| Performance fees | 2.0 | 3.0 | 27.2 | 13.2 | |||||||||||||||||||
| Other | 45.2 | 45.2 | 143.1 | 168.0 | |||||||||||||||||||
| Total operating revenues | 1,442.0 | 1,445.7 | 4,303.0 | 4,605.5 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Third-party distribution, service and advisory | 448.2 | 451.3 | 1,365.8 | 1,438.9 | |||||||||||||||||||
| Employee compensation | 478.5 | 420.8 | 1,417.0 | 1,260.9 | |||||||||||||||||||
| Marketing | 23.7 | 27.6 | 77.7 | 83.1 | |||||||||||||||||||
| Property, office and technology | 135.4 | 133.2 | 406.9 | 400.2 | |||||||||||||||||||
| General and administrative | 117.2 | 48.7 | 314.5 | 270.6 | |||||||||||||||||||
| Transaction, integration and restructuring | — | (0.6) | 41.6 | 34.8 | |||||||||||||||||||
| Amortization of intangibles | 11.3 | 14.5 | 38.5 | 44.4 | |||||||||||||||||||
| Total operating expenses | 1,214.3 | 1,095.5 | 3,662.0 | 3,532.9 | |||||||||||||||||||
| Operating income | 227.7 | 350.2 | 641.0 | 1,072.6 | |||||||||||||||||||
| Other income/(expense): | |||||||||||||||||||||||
| Equity in earnings of unconsolidated affiliates | 16.9 | 20.2 | 62.2 | 78.3 | |||||||||||||||||||
| Interest and dividend income | 10.8 | 3.3 | 26.5 | 6.6 | |||||||||||||||||||
| Interest expense | (17.3) | (18.6) | (53.7) | (67.6) | |||||||||||||||||||
| Other gains/(losses), net | (23.3) | (34.6) | 25.0 | (170.1) | |||||||||||||||||||
| Other income/(expense) of CIP, net | 15.2 | (65.4) | (5.4) | (62.5) | |||||||||||||||||||
| Income before income taxes | 230.0 | 255.1 | 695.6 | 857.3 | |||||||||||||||||||
| Income tax provision | (61.3) | (86.8) | (196.7) | (232.6) | |||||||||||||||||||
| Net income | 168.7 | 168.3 | 498.9 | 624.7 | |||||||||||||||||||
| Net (income)/loss attributable to noncontrolling interests in consolidated entities | 21.9 | 68.3 | 87.3 | 49.0 | |||||||||||||||||||
| Dividends declared on preferred shares | (59.2) | (59.2) | (177.6) | (177.6) | |||||||||||||||||||
| Net income attributable to Invesco Ltd. | $ | 131.4 | $ | 177.4 | $ | 408.6 | $ | 496.1 | |||||||||||||||
| Earnings per common share: | |||||||||||||||||||||||
| -basic | $ | 0.29 | $ | 0.39 | $ | 0.90 | $ | 1.08 | |||||||||||||||
| -diluted | $ | 0.29 | $ | 0.39 | $ | 0.89 | $ | 1.08 |
See accompanying notes.
Invesco Ltd.
Condensed Consolidated Statements of Comprehensive Income
(Unaudited)
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||
| (in millions) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
| Net income | $ | 168.7 | $ | 168.3 | $ | 498.9 | $ | 624.7 | |||||||||||||||
| Other comprehensive income/(loss), net of tax: | |||||||||||||||||||||||
| Currency translation differences on investments in foreign subsidiaries | (143.0) | (330.1) | (24.1) | (690.2) | |||||||||||||||||||
| Other comprehensive income/(loss), net of tax | 0.7 | 0.2 | 5.9 | 0.7 | |||||||||||||||||||
| Other comprehensive income/(loss) | (142.3) | (329.9) | (18.2) | (689.5) | |||||||||||||||||||
| Total comprehensive income/(loss) | 26.4 | (161.6) | 480.7 | (64.8) | |||||||||||||||||||
| Comprehensive loss/(income) attributable to noncontrolling interests in consolidated entities | 21.9 | 68.3 | 87.3 | 49.0 | |||||||||||||||||||
| Dividends declared on preferred shares | (59.2) | (59.2) | (177.6) | (177.6) | |||||||||||||||||||
| Comprehensive income/(loss) attributable to Invesco Ltd. | $ | (10.9) | $ | (152.5) | $ | 390.4 | $ | (193.4) |
See accompanying notes.
Invesco Ltd.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
| Nine months ended September 30, | |||||||||||
| (in millions) | 2023 | 2022 | |||||||||
| Operating activities: | |||||||||||
| Net income | $ | 498.9 | $ | 624.7 | |||||||
| Adjustments to reconcile net income to net cash provided by/(used in) operating activities: | |||||||||||
| Amortization and depreciation | 136.4 | 146.7 | |||||||||
| Common share-based compensation expense | 93.7 | 83.1 | |||||||||
| Other (gains)/losses, net | (23.0) | 170.1 | |||||||||
| Other (gains)/losses of CIP, net | 167.8 | 173.2 | |||||||||
| Equity in earnings of unconsolidated affiliates | (62.2) | (78.3) | |||||||||
| Distributions from equity method investees | 67.8 | 64.3 | |||||||||
| Changes in operating assets and liabilities: | |||||||||||
| (Purchase)/sale of investments by CIP, net | (377.7) | (397.2) | |||||||||
| (Purchase)/sale of investments, net | 17.2 | (20.5) | |||||||||
| (Increase)/decrease in receivables | 503.5 | 721.9 | |||||||||
| Increase/(decrease) in payables | (435.9) | (1,248.3) | |||||||||
| Net cash provided by/(used in) operating activities | 586.5 | 239.7 | |||||||||
| Investing activities: | |||||||||||
| Purchase of property, equipment and software | (124.0) | (119.8) | |||||||||
| Purchase of investments by CIP | (1,982.1) | (2,335.7) | |||||||||
| Sale of investments by CIP | 2,149.7 | 2,274.5 | |||||||||
| Purchase of investments | (85.1) | (173.5) | |||||||||
| Sale of investments | 50.8 | 73.4 | |||||||||
| Capital distribution from equity method investees | 18.5 | 38.7 | |||||||||
| Net cash inflows/(outflows) upon consolidation/deconsolidation of CIP | (10.5) | 4.4 | |||||||||
| Net cash provided by/(used in) investing activities | 17.3 | (238.0) | |||||||||
| Financing activities: | |||||||||||
| Purchases of treasury shares | (183.1) | (240.1) | |||||||||
| Dividends paid - preferred | (177.6) | (177.6) | |||||||||
| Dividends paid - common | (267.7) | (249.1) | |||||||||
| Third-party capital invested into CIP | 120.5 | 608.8 | |||||||||
| Third-party capital distributed by CIP | (196.2) | (191.2) | |||||||||
| Borrowings of debt of CIP | 545.1 | 54.3 | |||||||||
| Repayments of debt of CIP | (316.1) | (3.9) | |||||||||
| Repayments of senior notes | — | (600.0) | |||||||||
| Net cash provided by/(used in) financing activities | (475.1) | (798.8) | |||||||||
| Increase/(decrease) in cash and cash equivalents | 128.7 | (797.1) | |||||||||
| Foreign exchange movement on cash and cash equivalents | (7.3) | (114.0) | |||||||||
| Foreign exchange movement on cash and cash equivalents of CIP | (0.4) | (10.0) | |||||||||
| Cash and cash equivalents, beginning of period | 1,434.1 | 2,147.1 | |||||||||
| Cash and cash equivalents, end of period | $ | 1,555.1 | $ | 1,226.0 | |||||||
| Cash and cash equivalents | $ | 1,241.5 | $ | 1,023.6 | |||||||
| Cash and cash equivalents of CIP | 313.6 | 202.4 | |||||||||
| Total cash and cash equivalents per condensed consolidated statement of cash flows | $ | 1,555.1 | $ | 1,226.0 |
See accompanying notes**.**
Invesco Ltd.
Condensed Consolidated Statements of Changes in Equity
(Unaudited)
| Three months ended September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity Attributable to Invesco Ltd. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (in millions, except per share data) | Preferred Shares | Common Shares | Additional Paid-in-Capital | Treasury Shares | Retained Earnings | Accumulated Other Comprehensive Income/(Loss) | Total Equity Attributable to Invesco Ltd. | Nonredeemable Noncontrolling Interests in Consolidated Entities | Total Permanent Equity | Redeemable Noncontrolling Interests in Consolidated Entities Temporary Equity | |||||||||||||||||||||||||||||||||||||||||||||||||
| July 1, 2023 | 4,010.5 | 113.2 | $ | 7,433.0 | $ | (3,027.4) | $ | 7,617.9 | $ | (818.3) | $ | 15,328.9 | $ | 537.8 | $ | 15,866.7 | $ | 841.9 | |||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | 190.6 | — | 190.6 | 3.6 | 194.2 | (25.5) | |||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income/(loss) | — | — | — | — | — | (142.3) | (142.3) | — | (142.3) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Change in noncontrolling interests in consolidated entities, net | — | — | — | — | (0.4) | — | (0.4) | 42.3 | 41.9 | (62.3) | |||||||||||||||||||||||||||||||||||||||||||||||||
| Dividends declared - preferred ($14.75 per share) | — | — | — | — | (59.2) | — | (59.2) | — | (59.2) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Dividends declared - common ($0.20 per share) | — | — | — | — | (90.1) | — | (90.1) | — | (90.1) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Employee common share plans: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common share-based compensation | — | — | 23.9 | — | — | — | 23.9 | — | 23.9 | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Vested common shares | — | — | (8.3) | 8.3 | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Other common share awards | — | — | (5.8) | 12.2 | — | — | 6.4 | — | 6.4 | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Purchase of common shares | — | — | — | (3.9) | — | — | (3.9) | — | (3.9) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| September 30, 2023 | 4,010.5 | 113.2 | $ | 7,442.8 | $ | (3,010.8) | $ | 7,658.8 | $ | (960.6) | $ | 15,253.9 | $ | 583.7 | $ | 15,837.6 | $ | 754.1 |
| Three months ended September 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity Attributable to Invesco Ltd. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (in millions, except per share data) | Preferred Shares | Common Shares | Additional Paid-in-Capital | Treasury Shares | Retained Earnings | Accumulated Other Comprehensive Income/(Loss) | Total Equity Attributable to Invesco Ltd. | Nonredeemable Noncontrolling Interests in Consolidated Entities | Total Permanent Equity | Redeemable Noncontrolling Interests in Consolidated Entities Temporary Equity | |||||||||||||||||||||||||||||||||||||||||||||||||
| July 1, 2022 | 4,010.5 | 113.2 | $ | 7,563.2 | $ | (3,095.3) | $ | 7,323.2 | $ | (801.1) | $ | 15,113.7 | $ | 681.1 | $ | 15,794.8 | $ | 892.8 | |||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | 236.6 | — | 236.6 | (59.6) | 177.0 | (8.7) | |||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income/(loss) | — | — | — | — | — | (329.9) | (329.9) | — | (329.9) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Change in noncontrolling interests in consolidated entities, net | — | — | — | — | — | — | — | (12.1) | (12.1) | 106.3 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Dividends declared - preferred ($14.75 per share) | — | — | — | — | (59.2) | — | (59.2) | — | (59.2) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Dividends declared - common ($0.1875 per share) | — | — | — | — | (84.4) | — | (84.4) | — | (84.4) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Employee common share plans: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common share-based compensation | — | — | 26.0 | — | — | — | 26.0 | — | 26.0 | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Vested common shares | — | — | (36.6) | 36.6 | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Other common share awards | — | — | (5.6) | 12.2 | — | — | 6.6 | — | 6.6 | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Purchase of common shares | — | — | — | (5.7) | — | — | (5.7) | — | (5.7) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| September 30, 2022 | 4,010.5 | 113.2 | $ | 7,547.0 | $ | (3,052.2) | $ | 7,416.2 | $ | (1,131.0) | $ | 14,903.7 | $ | 609.4 | $ | 15,513.1 | $ | 990.4 |
See accompanying notes.
Invesco Ltd.
Condensed Consolidated Statements of Changes in Equity
(Unaudited)
| Nine months ended September 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity Attributable to Invesco Ltd. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (in millions, except per share data) | Preferred Shares | Common Shares | Additional Paid-in-Capital | Treasury Shares | Retained Earnings | Accumulated Other Comprehensive Income/(Loss) | Total Equity Attributable to Invesco Ltd. | Nonredeemable Noncontrolling Interests in Consolidated Entities | Total Permanent Equity | Redeemable Noncontrolling Interests in Consolidated Entities Temporary Equity | |||||||||||||||||||||||||||||||||||||||||||||||||
| January 1, 2023 | 4,010.5 | 113.2 | $ | 7,554.9 | $ | (3,040.9) | $ | 7,518.3 | $ | (942.4) | $ | 15,213.6 | $ | 629.9 | $ | 15,843.5 | $ | 998.7 | |||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | 586.2 | — | 586.2 | (35.1) | 551.1 | (52.2) | |||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income/(loss) | — | — | — | — | — | (18.2) | (18.2) | — | (18.2) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Change in noncontrolling interests in consolidated entities, net | — | — | — | — | (0.4) | — | (0.4) | (11.1) | (11.5) | (192.4) | |||||||||||||||||||||||||||||||||||||||||||||||||
| Dividends declared - preferred ( $44.25 per share) | — | — | — | — | (177.6) | — | (177.6) | — | (177.6) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Dividends declared - common ($0.5875 per share) | — | — | — | — | (267.7) | — | (267.7) | — | (267.7) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Employee common share plans: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common share-based compensation | — | — | 93.7 | — | — | — | 93.7 | — | 93.7 | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Vested common shares | — | — | (196.6) | 196.6 | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Other common share awards | — | — | (9.2) | 16.6 | — | — | 7.4 | — | 7.4 | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Purchase of common shares | — | — | — | (183.1) | — | — | (183.1) | — | (183.1) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| September 30, 2023 | 4,010.5 | 113.2 | $ | 7,442.8 | $ | (3,010.8) | $ | 7,658.8 | $ | (960.6) | $ | 15,253.9 | $ | 583.7 | $ | 15,837.6 | $ | 754.1 |
| Nine months ended September 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity Attributable to Invesco Ltd. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (in millions, except per share data) | Preferred Shares | Common Shares | Additional Paid-in-Capital | Treasury Shares | Retained Earnings | Accumulated Other Comprehensive Income/(Loss) | Total Equity Attributable to Invesco Ltd. | Nonredeemable Noncontrolling Interests in Consolidated Entities | Total Permanent Equity | Redeemable Noncontrolling Interests in Consolidated Entities Temporary Equity | |||||||||||||||||||||||||||||||||||||||||||||||||
| January 1, 2022 | 4,010.5 | 113.2 | $ | 7,688.0 | $ | (3,043.6) | $ | 7,169.2 | $ | (441.5) | $ | 15,495.8 | $ | 672.2 | $ | 16,168.0 | $ | 510.8 | |||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | 673.7 | — | 673.7 | (6.9) | 666.8 | (42.1) | |||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income/(loss) | — | — | — | — | — | (689.5) | (689.5) | — | (689.5) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Change in noncontrolling interests in consolidated entities, net | — | — | — | — | — | — | — | (55.9) | (55.9) | 521.7 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Dividends declared - preferred ($44.25 per share) | — | — | — | — | (177.6) | — | (177.6) | — | (177.6) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Dividends declared - common ($0.5450 per share) | — | — | — | — | (249.1) | — | (249.1) | — | (249.1) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Employee common share plans: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common share-based compensation | — | — | 83.1 | — | — | — | 83.1 | — | 83.1 | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Vested common shares | — | — | (219.3) | 219.3 | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Other common share awards | — | — | (4.8) | 12.2 | — | — | 7.4 | — | 7.4 | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Purchase of common shares | — | — | — | (240.1) | — | — | (240.1) | — | (240.1) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| September 30, 2022 | 4,010.5 | 113.2 | $ | 7,547.0 | $ | (3,052.2) | $ | 7,416.2 | $ | (1,131.0) | $ | 14,903.7 | $ | 609.4 | $ | 15,513.1 | $ | 990.4 |
See accompanying notes.
Invesco Ltd.
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
1. ACCOUNTING POLICIES
Corporate Information
Invesco Ltd. (the Parent) and its consolidated entities (collectively, the company or Invesco) provide retail and institutional clients with an array of investment management capabilities. The company operates globally and its sole business is investment management.
Certain disclosures included in the company’s annual report on Form 10-K for the year ended December 31, 2022 (annual report or Form 10-K) are not required to be included on an interim basis in the company’s quarterly reports on Forms 10-Q (Report). The company has condensed or omitted these disclosures. Therefore, this Report should be read in conjunction with the company’s annual report.
Basis of Accounting and Consolidation
The unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP) for interim financial information and with rules and regulations of the U.S. Securities and Exchange Commission (SEC) and consolidate the financial statements of the Parent and all of its controlled subsidiaries. In the opinion of management, the Condensed Consolidated Financial Statements reflect all adjustments, consisting of normal recurring accruals, which are necessary for the fair presentation of the financial condition and results of operations for the periods presented. All significant intercompany transactions, balances, revenues and expenses are eliminated upon consolidation. The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.
Accounting Pronouncements Recently Adopted
None.
Pending Accounting Pronouncements
None.
2. FAIR VALUE OF ASSETS AND LIABILITIES
The fair value of financial instruments is presented in the below summary table. The fair value of financial instruments held by CIP are presented in Note 11, "Consolidated Investment Products". See the company’s most recently filed Form 10-K for additional disclosures on valuation methodology and fair value.
| September 30, 2023 | December 31, 2022 | |||||||||||||
| (in millions) | Fair Value | Fair Value | ||||||||||||
| Cash and cash equivalents | $ | 1,241.5 | $ | 1,234.7 | ||||||||||
| Equity investments | 271.0 | 325.0 | ||||||||||||
| Foreign time deposits (1) | — | 25.7 | ||||||||||||
| Assets held for policyholders | 408.4 | 668.7 | ||||||||||||
| Policyholder payables (1) | (408.4) | (668.7) | ||||||||||||
| Total return swaps related to deferred compensation plans | (10.1) | (1.6) | ||||||||||||
(1) These financial instruments are not measured at fair value on a recurring basis. Foreign time deposits are measured at cost plus accrued interest, which approximates fair value, and are accordingly classified as Level 2 securities. Policyholder payables are indexed to the value of the assets held for policyholders and changes in fair value are recorded and offset to zero in other operating revenues.
The following table presents, by hierarchy levels, the carrying value of the company’s assets and liabilities, including major security type for equity and debt securities, which are measured at fair value on the company’s Condensed Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022, respectively:
| As of September 30, 2023 | |||||||||||||||||||||||
| (in millions) | Fair Value Measurements | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Cash equivalents: | |||||||||||||||||||||||
| Money market funds (1) | $ | 711.3 | $ | 711.3 | $ | — | $ | — | |||||||||||||||
| Investments: (2) | |||||||||||||||||||||||
| Equity investments: | |||||||||||||||||||||||
| Seed capital | 90.0 | 90.0 | — | — | |||||||||||||||||||
| Investments related to deferred compensation plans | 179.6 | 179.6 | — | — | |||||||||||||||||||
| Other equity securities | 1.4 | 1.4 | — | — | |||||||||||||||||||
| Assets held for policyholders (3) | 408.4 | 408.4 | — | — | |||||||||||||||||||
| Total | $ | 1,390.7 | $ | 1,390.7 | $ | — | $ | — | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Total return swaps related to deferred compensation plans | (10.1) | — | (10.1) | — | |||||||||||||||||||
| Contingent consideration liability | $ | (1.3) | $ | — | $ | — | $ | (1.3) | |||||||||||||||
| Total | $ | (11.4) | $ | — | $ | (10.1) | $ | (1.3) |
| As of December 31, 2022 | |||||||||||||||||||||||
| (in millions) | Fair Value Measurements | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Cash equivalents: | |||||||||||||||||||||||
| Money market funds (1) | $ | 760.8 | $ | 760.8 | $ | — | $ | — | |||||||||||||||
| Investments (2): | |||||||||||||||||||||||
| Equity investments: | |||||||||||||||||||||||
| Seed capital | 177.9 | 177.9 | — | — | |||||||||||||||||||
| Investments related to deferred compensation plans | 146.1 | 146.1 | — | — | |||||||||||||||||||
| Other equity securities | 1.0 | 1.0 | — | — | |||||||||||||||||||
| Assets held for policyholders (3) | 668.7 | 668.7 | — | — | |||||||||||||||||||
| Total | $ | 1,754.5 | $ | 1,754.5 | $ | — | $ | — | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Total return swaps related to deferred compensation plans | $ | (1.6) | $ | — | $ | (1.6) | $ | — | |||||||||||||||
| Contingent consideration liability | (1.3) | — | — | (1.3) | |||||||||||||||||||
| Total | $ | (2.9) | $ | — | $ | (1.6) | $ | (1.3) |
(1) The balance primarily represents cash held in affiliated money market funds.
(2) Equity method and other investments of $637.0 million and $24.6 million, respectively, are excluded from this table (December 31, 2022: $621.2 million and $24.7 million, respectively). These investments are not measured at fair value, in accordance with applicable accounting standards.
(3) The majority of assets held for policyholders are held in affiliated funds.
Total Return Swaps (TRS)
In addition to holding equity investments, the company has TRS to hedge economically certain deferred compensation liabilities. The notional value of the TRS at September 30, 2023 was $366.2 million, and the fair value of the TRS was a liability of $10.1 million (December 31, 2022 notional value was $326.6 million and the fair value was a liability of $1.6 million). The company’s net collateral paid balance related to the TRS was $11.9 million at September 30, 2023 (December 31, 2022: $0.0 million). During the three months ended September 30, 2023, market valuation losses related to the TRS of $16.6 million were recognized in Other gains/(losses), net (three months ended September 30, 2022: $19.8 million net loss). During the nine months ended September 30, 2023, market valuation gains related to the TRS of $3.8 million were recognized in Other gains/(losses), net (nine months ended September 30, 2022: $91.9 million net loss).
3. INVESTMENTS
The disclosures below include details of the company’s investments. Investments held by CIP are detailed in Note 11, "Consolidated Investment Products".
| (in millions) | September 30, 2023 | December 31, 2022 | |||||||||
| Equity investments: | |||||||||||
| Seed capital | $ | 90.0 | $ | 177.9 | |||||||
| Investments related to deferred compensation plans | 179.6 | 146.1 | |||||||||
| Other equity securities | 1.4 | 1.0 | |||||||||
| Equity method investments | 637.0 | 621.2 | |||||||||
| Foreign time deposits | — | 25.7 | |||||||||
| Other | 24.6 | 24.7 | |||||||||
| Total investments (1) | $ | 932.6 | $ | 996.6 |
(1) The majority of the company’s investment balances relate to balances held in affiliated funds and equity method investees.
Equity investments
The unrealized gains and losses for the three and nine months ended September 30, 2023 that relate to equity investments still held at September 30, 2023, were a $10.8 million net loss and $13.2 million net gain (three and nine months ended September 30, 2022: $14.4 million net loss and $84.1 million net loss).
4. DEBT
The disclosures below include details of the company’s debt. Debt of CIP is detailed in Note 11, "Consolidated Investment Products".
| September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
| (in millions) | Carrying Value (2) | Fair Value | Carrying Value (2) | Fair Value | |||||||||||||||||||
| $2.0 billion floating rate credit facility expiring April 26, 2028 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||
| Unsecured Senior Notes: (1) | |||||||||||||||||||||||
| $600 million 4.000% - due January 30, 2024 | 599.6 | 596.0 | 598.8 | 591.5 | |||||||||||||||||||
| $500 million 3.750% - due January 15, 2026 | 498.4 | 479.2 | 497.9 | 486.4 | |||||||||||||||||||
| $400 million 5.375% - due November 30, 2043 | 391.1 | 358.9 | 390.9 | 397.3 | |||||||||||||||||||
| Debt | $ | 1,489.1 | $ | 1,434.1 | $ | 1,487.6 | $ | 1,475.2 |
(1) The company’s senior note indentures contain certain restrictions on mergers or consolidations. Beyond these items, there are no other restrictive covenants in the indentures.
(2) The difference between the principal amounts and the carrying values of the senior notes in the table above reflect the unamortized debt issuance costs and discounts.
5. SHARE CAPITAL
The number of preferred shares issued and outstanding is represented in the table below:
| As of | |||||||||||
| (in millions) | September 30, 2023 | December 31, 2022 | |||||||||
| Preferred shares issued (1) | 4.0 | 4.0 | |||||||||
| Preferred shares outstanding (1) | 4.0 | 4.0 |
(1) Preferred shares are held by Massachusetts Mutual Life Insurance Company (MassMutual) and are subject to a lock-up period of five years, which prohibits the sale of the preferred shares by MassMutual until May 24, 2024.
The number of common shares and common share equivalents issued are represented in the table below:
| As of | |||||||||||
| (in millions) | September 30, 2023 | December 31, 2022 | |||||||||
| Common shares issued | 566.1 | 566.1 | |||||||||
| Less: Treasury shares for which dividend and voting rights do not apply | (116.5) | (111.3) | |||||||||
| Common shares outstanding | 449.6 | 454.8 |
6. OTHER COMPREHENSIVE INCOME/(LOSS)
The components of accumulated other comprehensive income/(loss) were as follows:
| Three months ended September 30, 2023 | Three months ended September 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||
| (in millions) | Foreign currency translation | Employee benefit plans | Total | Foreign currency translation | Employee benefit plans | Total | |||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income/(loss), net of tax: | |||||||||||||||||||||||||||||||||||||||||||||||
| Currency translation differences on investments in foreign subsidiaries | $ | (143.0) | $ | — | $ | (143.0) | $ | (330.1) | $ | — | $ | (330.1) | |||||||||||||||||||||||||||||||||||
| Other comprehensive income/(loss), net | — | 0.7 | 0.7 | — | 0.2 | 0.2 | |||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income/(loss), net of tax | (143.0) | 0.7 | (142.3) | (330.1) | 0.2 | (329.9) | |||||||||||||||||||||||||||||||||||||||||
| Beginning balance | (696.1) | (122.2) | (818.3) | (712.0) | (89.1) | (801.1) | |||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income/(loss), net of tax | (143.0) | 0.7 | (142.3) | (330.1) | 0.2 | (329.9) | |||||||||||||||||||||||||||||||||||||||||
| Ending balance | $ | (839.1) | $ | (121.5) | $ | (960.6) | $ | (1,042.1) | $ | (88.9) | $ | (1,131.0) |
| Nine months ended September 30, 2023 | Nine months ended September 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (in millions) | Foreign currency translation | Employee benefit plans | Total | Foreign currency translation | Employee benefit plans | Total | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income/(loss), net of tax: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Currency translation differences on investments in foreign subsidiaries | $ | (24.1) | $ | — | $ | (24.1) | $ | (690.2) | $ | — | $ | (690.2) | |||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income/(loss), net | — | 5.9 | 5.9 | — | 0.7 | 0.7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income/(loss), net of tax | (24.1) | 5.9 | (18.2) | (690.2) | 0.7 | (689.5) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Beginning balance | (815.0) | (127.4) | (942.4) | (351.9) | (89.6) | (441.5) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income/(loss), net of tax | (24.1) | 5.9 | (18.2) | (690.2) | 0.7 | (689.5) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Ending balance | $ | (839.1) | $ | (121.5) | $ | (960.6) | $ | (1,042.1) | $ | (88.9) | $ | (1,131.0) |
7. REVENUE
The geographic disaggregation of revenue for the three and nine months ended September 30, 2023 and 2022 are presented below. There are no revenues attributed to the company’s country of domicile, Bermuda.
| Three months ended September 30, | |||||||||||
| (in millions) | 2023 | 2022 | |||||||||
| Americas | $ | 1,107.3 | $ | 1,125.1 | |||||||
| Asia-Pacific (APAC) | 64.6 | 63.2 | |||||||||
| Europe, Middle East and Africa (EMEA) | 270.1 | 257.4 | |||||||||
| Total operating revenues | $ | 1,442.0 | $ | 1,445.7 |
| Nine months ended September 30, | |||||||||||
| (in millions) | 2023 | 2022 | |||||||||
| Americas | $ | 3,298.8 | $ | 3,553.2 | |||||||
| Asia-Pacific (APAC) | $ | 198.2 | $ | 218.7 | |||||||
| Europe, Middle East and Africa (EMEA) | $ | 806.0 | $ | 833.6 | |||||||
| Total operating revenues | $ | 4,303.0 | $ | 4,605.5 |
8. COMMON SHARE-BASED COMPENSATION
The company recognized total compensation expense of $93.7 million and $83.1 million related to equity-settled common share-based payment transactions in the nine months ended September 30, 2023 and 2022, respectively.
Movements on employee common share awards during the periods ended September 30 are detailed below:
| Nine months ended September 30, 2023 | Nine months ended September 30, 2022 | ||||||||||||||||||||||||||||||||||
| (in millions of common shares, except fair values) | Time- Vested | Performance- Vested | Weighted Average Grant Date Fair Value | Time- Vested | Performance- Vested | ||||||||||||||||||||||||||||||
| Unvested at the beginning of period | 10.3 | 2.1 | $ | 19.03 | 13.5 | 1.9 | |||||||||||||||||||||||||||||
| Granted during the period | 5.2 | 0.7 | 17.64 | 3.6 | 1.0 | ||||||||||||||||||||||||||||||
| Forfeited during the period | (0.2) | (0.2) | 16.49 | (0.3) | (0.1) | ||||||||||||||||||||||||||||||
| Vested and distributed during the period | (5.0) | (0.5) | 18.02 | (6.2) | (0.4) | ||||||||||||||||||||||||||||||
| Unvested at the end of the period | 10.3 | 2.1 | $ | 18.90 | 10.6 | 2.4 |
The total fair value of common shares that vested during the nine months ended September 30, 2023 was $96.3 million (nine months ended September 30, 2022: $131.7 million). The weighted average grant date fair value of the U.S. dollar share awards that were granted during the nine months ended September 30, 2023 was $17.64 (nine months ended September 30, 2022: $21.23).
At September 30, 2023, there was $143.4 million of total unrecognized compensation cost related to non-vested common share awards; that cost is expected to be recognized over a weighted average period of 2.55 years.
9. EARNINGS PER COMMON SHARE
The calculation of earnings per common share (EPS) is as follows:
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||||||||||||||||||
| (in millions, except per share data) | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||||||||||||||||
| Net income attributable to Invesco Ltd. | $ | 131.4 | $ | 177.4 | $ | 408.6 | $ | 496.1 | ||||||||||||||||||||||||||||||||||||
| Invesco Ltd: | ||||||||||||||||||||||||||||||||||||||||||||
| Weighted average common shares outstanding - basic | 451.7 | 457.0 | 455.9 | 457.7 | ||||||||||||||||||||||||||||||||||||||||
| Dilutive effect of non-participating common share-based awards | 1.4 | 2.5 | 1.3 | 2.3 | ||||||||||||||||||||||||||||||||||||||||
| Weighted average common shares outstanding - diluted | 453.1 | 459.5 | 457.2 | 460.0 | ||||||||||||||||||||||||||||||||||||||||
| Earnings per common share: | ||||||||||||||||||||||||||||||||||||||||||||
| -basic | $ | 0.29 | $ | 0.39 | $ | 0.90 | $ | 1.08 | ||||||||||||||||||||||||||||||||||||
| -diluted | $ | 0.29 | $ | 0.39 | $ | 0.89 | $ | 1.08 |
See Note 8, "Common Share-Based Compensation," for a summary of common share awards outstanding under the company’s common share-based payment programs. These programs could result in the issuance of common shares that would affect the measurement of basic and diluted EPS.
10. COMMITMENTS AND CONTINGENCIES
Commitments and contingencies may arise in the ordinary course of business.
The company has committed to co-invest in certain investment products, which may be called in future periods. At September 30, 2023, the company’s undrawn co-invest capital commitments were $659.0 million (December 31, 2022: $336.1 million). The increase in capital commitments is driven by our continued support for private markets’ capabilities.
Certain of our managed investment products have entered into revolving credit facilities with financial institutions. Pursuant to these arrangements, the company provided equity commitments and guarantees to certain of these investment products that are temporary in nature. The revolving credit facilities look first to the respective investment products for repayment and servicing. The company’s equity commitment or guarantee would only be called in the event a particular investment product is unable to meet its obligation. The company believes the likelihood of being required to fund its equity commitments or guarantees under these arrangements to be remote. To date, the company has not been required to fund any equity commitments or guarantees under these arrangements. The maximum amount of future payments under the commitments is $274 million and under the guarantees is $30.0 million. The fair value of the guarantee liability is not significant to the consolidated financial statements.
The company and some of its subsidiaries have entered into agreements with financial institutions to guarantee certain obligations of other company subsidiaries. The company would be required to perform under these guarantees in the event of certain defaults. The company has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote.
Legal Contingencies
The company is from time to time involved in pending or threatened litigation relating to claims arising in the ordinary course of its business. The nature and progression of litigation can make it difficult to predict the impact a particular lawsuit or claim will have on the company. There are many reasons that the company cannot make these assessments, including, among others, one or more of the following: the proceeding is in its early stages (or merely threatened); the damages sought are unspecified, unsupportable, unexplained or uncertain; the claimant is seeking relief other than compensatory damages; the matter presents novel legal claims or other meaningful legal uncertainties; discovery has not started or is not complete; there are significant facts in dispute; and there are other parties who may share in any ultimate liability.
The company and certain related entities have in recent years been subject to various regulatory inquiries, reviews and investigations and legal proceedings, including civil litigation and governmental investigations and enforcement actions. These actions can arise from normal business operations and/or matters that have been the subject of previous regulatory reviews. As a global company with investment products registered in numerous countries and subject to the jurisdiction of one or more regulators in each country, at any given time, our business operations may be subject to review, investigation, or disciplinary action. For example, the company is cooperating with requests from the SEC in connection with their investigation of investment advisers’ compliance with record retention requirements relating to certain types of electronic business communications.
In assessing the impact that a legal or regulatory matter will have on the company, management evaluates the need for an accrual on a case-by-case basis. If the likelihood of a loss is deemed probable and is reasonably estimable, the estimated loss is accrued. If the likelihood of a loss is assessed as less than probable, or an amount or range of loss cannot be reasonably estimated, a loss is not accrued. In management’s opinion, adequate accrual has been made as of September 30, 2023 to provide for any such losses that may arise from matters for which the company could reasonably estimate an amount and are deemed probable. Management is of the opinion that the ultimate resolution of claims will not materially affect the company’s business, revenue, net income or liquidity.
11. CONSOLIDATED INVESTMENT PRODUCTS
The balances related to CIP are identified on the Consolidated Balance Sheets. At September 30, 2023, the company’s net investment in and net receivables from CIP were $543.6 million (December 31, 2022: $386.6 million). The consolidation of CIP had no impact on net income attributable to the company during the three months and nine months ended September 30, 2023.
The following tables present the fair value hierarchy levels of certain CIP balances which are measured at fair value as of September 30, 2023 and December 31, 2022:
| As of September 30, 2023 | |||||||||||||||||||||||||||||
| (in millions) | Fair Value Measurements | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Investments Measured at NAV as a practical expedient | ||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||
| Bank loans | $ | 6,679.2 | $ | — | $ | 6,127.7 | $ | 551.5 | $ | — | |||||||||||||||||||
| Bonds | 683.2 | 10.7 | 672.5 | — | — | ||||||||||||||||||||||||
| Equity securities | 203.9 | 87.5 | 17.4 | 99.0 | — | ||||||||||||||||||||||||
| Equity and fixed income mutual funds | 166.0 | 27.4 | 138.6 | — | — | ||||||||||||||||||||||||
| Investments in other private equity funds | 401.2 | — | — | — | 401.2 | ||||||||||||||||||||||||
| Real estate investments | 479.4 | — | — | — | 479.4 | ||||||||||||||||||||||||
| Total assets at fair value | $ | 8,612.9 | $ | 125.6 | $ | 6,956.2 | $ | 650.5 | $ | 880.6 | |||||||||||||||||||
| As of December 31, 2022 | |||||||||||||||||||||||||||||
| (in millions) | Fair Value Measurements | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Investments Measured at NAV as a practical expedient | ||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||
| Bank loans | $ | 6,315.1 | $ | — | $ | 6,069.8 | $ | 245.3 | $ | — | |||||||||||||||||||
| Bonds | 697.5 | 8.8 | 688.2 | 0.5 | — | ||||||||||||||||||||||||
| Equity securities | 274.9 | 129.9 | 29.8 | 115.2 | — | ||||||||||||||||||||||||
| Equity and fixed income mutual funds | 230.7 | 38.8 | 191.9 | — | — | ||||||||||||||||||||||||
| Investments in other private equity funds | 461.2 | — | — | 7.6 | 453.6 | ||||||||||||||||||||||||
| Real estate investments | 552.0 | — | — | — | 552.0 | ||||||||||||||||||||||||
| Total assets at fair value | $ | 8,531.4 | $ | 177.5 | $ | 6,979.7 | $ | 368.6 | $ | 1,005.6 | |||||||||||||||||||
The following table shows a reconciliation of the beginning and ending fair value measurements for level 3 assets using significant unobservable inputs:
| Three months ended September 30, | |||||||||||
| 2023 | 2022 | ||||||||||
| (in millions) | Level 3 Assets | Level 3 Assets | |||||||||
| Beginning Balance as of July 1 | $ | 490.8 | $ | 328.3 | |||||||
| Purchases | 220.4 | 2.1 | |||||||||
| Sales | (11.7) | (2.7) | |||||||||
| Deconsolidation of CIP | — | — | |||||||||
| Gains and losses included in the Consolidated Statements of Income | (9.3) | 6.0 | |||||||||
| Transfers from Level 3 into Levels 1 or 2 | (78.9) | (130.3) | |||||||||
| Transfers into Level 3 from Levels 1 or 2 | 36.0 | 126.0 | |||||||||
| Foreign exchange | 3.2 | (0.6) | |||||||||
| Ending Balance as of September 30 | $ | 650.5 | $ | 328.8 |
| Nine months ended September 30, | |||||||||||
| 2023 | 2022 | ||||||||||
| (in millions) | Level 3 Assets | Level 3 Assets | |||||||||
| Beginning Balance as of January 1 | $ | 368.6 | $ | 239.5 | |||||||
| Purchases | 430.9 | 2.2 | |||||||||
| Sales | (53.8) | (11.3) | |||||||||
| Deconsolidation of CIP | (0.6) | — | |||||||||
| Gains and losses included in the Consolidated Statements of Income | (10.6) | 3.8 | |||||||||
| Transfers from Level 3 into Levels 1 or 2 | (321.4) | (223.8) | |||||||||
| Transfers into Level 3 from Levels 1 or 2 | 231.9 | 319.4 | |||||||||
| Foreign exchange | 5.5 | (1.0) | |||||||||
| Ending Balance as of September 30 | $ | 650.5 | $ | 328.8 |
Non-consolidated Variable interest entities (VIEs)
At September 30, 2023, the company's risk of loss with respect to VIEs in which the company is not the primary beneficiary included our investment carrying value of $141.0 million (December 31, 2022: $111.5 million) and unfunded capital commitments of $142.4 million (December 31, 2022: $99.0 million).
See the company’s most recently filed Form 10-K for additional disclosures on valuation methodology and fair value.
12. RELATED PARTIES
MassMutual owns approximately 18.1% in common stock of the company and owns all of the outstanding $4.0 billion in perpetual, non-cumulative preferred shares as of September 30, 2023. Based on the level of shares owned by MassMutual and the corresponding customary minority shareholder rights, which includes representation on Invesco’s Board of Directors, the company considers MassMutual a related party.
Additionally, certain managed funds are deemed to be affiliated entities under the related party definition in ASC 850, “Related Party Disclosures.” The majority of the company's operating revenues and receivables are from Invesco's managed funds. Related parties also include those defined in the company’s proxy statement.
Refer to Note 2, "Fair Value of Assets and Liabilities" and Note 3, "Investments" for more information on balances invested in Invesco affiliated funds.
13. SUBSEQUENT EVENTS
On October 24, 2023, the company declared a third quarter 2023 dividend of $0.20 per common share, payable on December 4, 2023, to common shareholders of record at the close of business on November 10, 2023 with an ex-dividend date of November 9, 2023.
On October 24, 2023, the company declared a preferred dividend of $14.75 per preferred share to the holders of preferred shares representing the period from September 1, 2023 through November 30, 2023. The preferred dividend is payable on December 1, 2023 to preferred shareholders of record at the close of business on November 15, 2023.
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