BAM 10-K & 10-Q changes, risk factors and insider trading

You should carefully consider the following factorsrisk factors, in addition to other information set forth in this Annual Report. If any of the following risks were actually to occur, our business, financial condition and results of operations and the prospects and value of the Class A Shares would likely suffer.be materially impacted.

Management is responsible for establishing and maintaining adequate internal controlscontrol over financial reporting to give our stakeholders assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in conformity with U.S. GAAP. However, the process for establishing and maintaining adequate internal controlscontrol over financial reporting has inherent limitations, including the possibility of human error. In addition, we may exclude recently acquired companies from our evaluation of internal controls.

Our internal controlscontrol over financial reporting may not prevent or detect misstatements in our financial disclosures on a timely basis, or at all. Some of these processes may be new for certain subsidiaries in our structure, and in the case of acquisitions, may take time to be fully implemented.

If BAM or our auditors were to conclude that our internal controlscontrol over financial reporting were not effective in respect of any reporting period, investors could lose confidence in our reported financial information and the price of our Class A Shares could decline. Our failure to achieve and maintain effective internal controls could have a materially adverse effect on our business, our ability to access capital markets and our reputation. In addition, material weaknesses in our internal controls could require significant expense and management time to remediate.

BAM is headquartered in New York, NY, but some of its officers and directors are not residents of the United States,U.S., and a portion of the assets of BAM and said persons are located outside the United States.U.S.. As a result, it may be difficult for U.S. investors to: (i) effect service of process within the United StatesU.S. upon BAM or those directors and officers who are not residents of the United StatesU.S.; or (ii) realize in the United StatesU.S. upon judgments of courts of the United StatesU.S. predicated upon the civil liability provisions of the United StatesU.S. federal securities laws. Investors outside of the U.S. will similarly find it difficult to enforce judgments obtained outside of the U.S.

Our business is not only regulated in the U.S., but also in other jurisdictions where we conduct operations including, but not limited to, the E.U., the U.K., Canada, Brazil, Colombia, Australia, India and South Korea. Similar to the environment in the U.S., our business and how we market in jurisdictions outside the U.S. hashave become subject to further regulation. Governmental agencies around the world have proposed or implemented a number of initiatives and additional rules and regulations that could adversely affect our business and our managed assets, and governmental agencies may propose or implement further rules and regulations in the future. These rules and regulations may impact how we market in these jurisdictions and introduce compliance obligations with respect to disclosure and transparency, as well as restrictions on investor participation and distributions. Such regulations may also prescribe certain capital requirements on our managed assets, and conditions on the leverage our managed assets may employ and the liquidity these managed assets must have. Compliance with additional regulatory requirements will impose additional restrictions and expenses for us and could reduce our operating flexibility and fundraising opportunities.

The broker-dealer side of our managed assets is regulated by the SEC, the various Canadian provincial and territorial securities commissions,commissions and administrators, as well as self-regulatory organizations, including the Financial Industry Regulatory Authority in the U.S. These regulatory bodies may conduct administrative or enforcement proceedings that can result in censure, fine, suspension or expulsion of a broker-dealer, its directors, officers or employees. Such proceedings, whether or not resulting in adverse findings, can require substantial expenditures and can have an adverse impact on the reputation of a broker-dealer.

Most of our funds rely on Rule 506 of Regulation D under the U.S. Securities Act to raise capital from investors. Rule 506 is not available to issuers deemed to be “bad actors” under Rule 506 if a covered person of the issuer has been the subject to certain criminal, civil or regulatory disqualifying events. Covered persons include, among others, the issuer, executive officer or other officer participating in the offering of the issuer, any general partner or managing member of the foregoing entities, any promoter of the issuer and any beneficial owner of 20% or more of the issuer’s outstanding voting equity securities. If one or more of our funds were to lose the ability to rely on the Rule 506 exemption because a covered person has been the subject of a disqualifying event, our business, financial condition and results of operations could be materially and adversely affected.

We are subject to a number of laws and regulations governing payments and contributions to public officials or other third parties both domestically and in respect of managed assets abroad, including the U.S. Foreign Corrupt Practices Act of 1977 (the “FCPA”), various federal and state corruption laws, and similar laws in non-U.S. jurisdictions, such as the U.K. Bribery Act 2010, the Canadian Corruption of Foreign Public Officials Act (the “CFPOA”) and Part IV of the Criminal Code (Canada), the Brazilian Clean Companies Act, the Australian Criminal Code Act 1995, the Indian Prevention of Corruption Act,Act 1988, and the Bermudian Bribery Act 2016. This global focus on anti-bribery and corruption enforcement may also lead to more investigations, both formal and informal, in this area, the results of which cannot be predicted.

We are also subject to laws and regulations governing trade and economic sanctions. The Office of Foreign Assets Control of the U.S. Department of the Treasury,Treasury (“OFAC”), the U.S. Department of Commerce and the U.S. Department of State administer and enforce various trade control laws and regulations, including economic and trade sanctions based on U.S. foreign policy and national security goals against targeted foreign states, organizations and individuals. These laws and regulations implicate a number of aspects of our business, including servicing existing fund investors, finding new fund investors, and sourcing new investments, as well as activities by our managed assets or other controlled investments. Some of these regulations provide that penalties can be imposed on us for the conduct of our managed assets, even if we have not ourselves violated any regulation. Similar laws in non-U.S. jurisdictions, such as the Special Economic Measures Act (Canada), the United Nations Act (Canada) and the Justice for Victims of Corrupt Foreign Officials Act (Canada), and E.U. sanctions, may also impose restrictions or requirements on us or our managed assets. Anti-corruption, anti-money laundering, economic sanctions, and trade control laws imposed by non-U.S. jurisdictions, such as EUE.U. and UKU.K. sanctions or blocking statutes and the UKU.K. Bribery Act, may also impose stricter or more onerous requirements than the FCPA, OFAC, the U.S. Department of Commerce, the U.S. Department of State or U.S. Department of Treasury, and implementing them may disrupt our business or cause us to incur significantly more costs to comply with those laws. Different laws may also contain conflicting provisions, making compliance with all laws more difficult.” In February 2022, the U.S. and other countries began imposing meaningful sanctions targeting Russia as a result of actions taken by Russia in Ukraine. We and our managed assets are required to comply with these and potentially additional sanctions imposed by the U.S. and by other countries, for which the full costs, burdens and limitations on our business and prospects are currently unknown and may become significant.

In addition, the U.S. and many non-U.S. countries that have laws designed to protect national security or to restrict foreign direct investment. For example, under the United States Foreign Investment Risk Review Modernization Act,Act of 2018, the Committee on Foreign Investment in the United States has the authority to review, block or impose conditions on investments by non-U.S. persons in U.S. companies or real assets deemed critical or sensitive to the U.S. Many non-U.S. jurisdictions have similar laws. For example, the E.U. has adopted an E.U.-wide mechanism to screen foreign investment on national security grounds and most E.U. member states now have a foreign investment screening mechanism in place or has initiated a consultative or legislative process expected to result in the adoption of a new mechanism or amendments to an existing mechanism, adopted a regulation aimed at regulation of foreign subsidies that could distort the internal E.U. market.

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and similar laws in other jurisdictions impose rules and regulations governing oversight of the over-the-counter derivatives market and its participants. These regulations may impose additional costs and regulatory scrutiny on us. If our derivative transactions are required to be executed through exchanges or regulated facilities, we will face incremental collateral requirements in the form of an initial margin and require variation margin to be cash settled on a daily basis. Such an increase in margin requirements (relative to bilateral agreements) or a more restricted list of securities that qualify as eligible collateral, would require us to hold larger positions in cash and treasuries, which could reduce income. We cannot predict the effect of changing derivatives legislation on our hedging costs, our hedging strategy or its implementation, or the risks that we hedge. Regulation of derivatives may increase the cost of derivative contracts, reduce the availability of derivatives to protect against operational risk and reduce the liquidity of the over-the-counter derivatives market, all of which may reduce our use of derivatives and result in the increased volatility and decreased predictability of our cash flows.

We are subject to geopolitical uncertainties in all jurisdictions in which we operate. We make investments in businesses that are based outside of the United StatesU.S. and we may pursue investments in unfamiliar markets, which may expose us to additional risks not typically associated with investing in the United States.U.S.. We may not properly adjust to the local culture and business practices in such markets, and there is the prospect that we may hire personnel or partner with local persons who might not comply with our culture and ethical business practices; either scenario could result in the failure of our initiatives in new or existing markets and lead to financial losses for us and our managed assets. There are risks of political instability and significant changes in laws and policies in several of our major markets and in other parts of the world in which we conduct business from factors such as political conflict, tariffs and other protectionist trade policies, including the encouragement of the onshoring of manufacturing in the U.S. and other countries, income inequality, refugee migration, terrorism, armed conflict, the potential break-up of countries or political-economic unions and political corruption; the materialization of one or more of these risks could negatively affect our financial performance.

Our managed assets are impacted by inflationary pressures. While inflationinflationary haspressures eased and central banks began reducing interest rates in the2025 secondacross halfmany of 2024,jurisdictions, past price increases continue to affect households and weigh on confidence and spending power. TheIncreased potentialtariffs, forretaliatory increased tariffsactions and trade barriers, as well as increased geopolitical risks, addsadd uncertainty to the long termlong-term outlook for inflation and interest rates and a reacceleration of inflation could trigger a reversal in recent interest rate decreases. Interest rate increases or other government actions taken to reduce inflation could also result in recessionary pressures in many parts of the world. Interest rate risk poses a significant market risk to us as a result of interest rate-sensitive assets and liabilities held by us and our managed assets. Higher interest rates or elevated interest rates for a sustained period could also result in an economic slowdown. Economic contraction or further deceleration in the rate of growth in certain industries, sectors or geographies may contribute to poor financial results at our managed assets. While regulated and contractual arrangements in our managed assets can provide significant protection against inflationary pressures, any sustained upward trajectory in the inflation rate may still have an impact on our managed assets and our investors, and could impact our ability to source suitable investment opportunities, match or exceed prior investment strategy performance and secure attractive debt financing, all of which could adversely impact our managed assets and our growth and capital recycling initiatives.

Our managed assets could be exposed to the effects of catastrophic events, such as severe weather conditions, natural disasters, major accidents, pandemics/epidemics, acts of malicious destruction, climate change, war/military conflict or terrorism, which could materially adversely impact our operations.

Natural disasters and ongoing changes to the physical climate in which we and our managed assets operate may have an adverse impact on our business, financial position, results of operations or cash flows. Changes in weather patterns or extreme weather (such as floods, wildfires, droughts, hurricanes and other storms) may negatively affect our managed assets’ operations or damage assets that we may own or develop. Further, rising sea levels and/or other types of flooding could, in the future, affect the value of any low-lyingcoastal coastalor other real assets and businesses that we may manage. Climate change may increase the frequency and severity of severe weather conditions and may change existing weather patterns in ways that are difficult to anticipate. Responses to and impacts from these changes could result in lower revenues and/or higher costs, such as the imposition of new property taxestaxes, andlimited availability of insurance, increases in insurance rates or additional capital or operating expenditures.

There is increasing stakeholder interest in sustainability considerations and how they are managed. Sustainability considerations include climate change, human capital and labor management, corporate governance, diversity and privacy and data security, among others. Increasingly,Certain investors and lenders are incorporating sustainability considerations into their investment or lending process, respectively, alongside traditional financial considerations. Investors or potential investors may not invest in all our products given certain industries in which we operate. If we are unable to successfully integrate sustainability considerations into our practices, we may incur a higher cost of capital, lower interest in our debt securities and/or equity securities or otherwise face a negative impact on our business, operating results and cash flows and result in reputational damage.

Certain of our managed assets may be subject to compliance with laws, regulations, regulatory rules and/or guidance relating to sustainability, and any failure to comply with these laws, regulations, regulatory rules and/or guidance could expose us to material adverse consequences, including loss, limitations on our ability to undertake licensable business, legal liabilities, financial and non-financial sanctions and penalties, and/or reputational damage. Sustainability requirements imposed by jurisdictions in which we do business, such as the E.U. Sustainable Finance Disclosure Regulation (2019/2088), could (a) result in additional compliance costs, disclosure obligations or other implications or restrictions; and/or (b) impact our established business practices, cost base and, by extension, our profitability.

Sustainability-related requirements and market practices differ by region, industry and issue and are evolving dynamically, and the sustainability requirements applicable to us, our managed assets or our assessment of such requirements or practices may change over time. Under emerging sustainability requirements, we may be required to classify our businesses against, or determine the alignment of underlying investments under, Sustainability-relatedsustainability-related legislative and regulatory criteria and taxonomies, some of which can be open to subjective interpretation. Our view on the appropriate classifications may develop over time, including in response to statutory or regulatory guidance or changes in industry approach to classification. A change to the relevant classification may require further actions to be taken, for exampleexample, it may require further disclosures, or it may require new processes to be set up to capture data, which may lead to additional cost, disclosure obligations or other implications or restrictions.

The transition to a lower-carbon economy has the potential to be disruptive to traditional business models and investment strategies. Efforts to limit globalclimate warmingchange may give rise to changes in regulations, reporting and consumer sentiment that could have a negative impact on our existing operations by increasing the costs of operating our business or reducing demand for our products and services. The adverse effects of climate change and related regulation at state, provincial, federal or international levels could have a material adverse effect on our business, financial position, results of operations or cash flows.

Health, safety and environmental laws and regulations can change rapidly and significantly, and we and/or our managed assets may become subject to more stringent laws and regulations in the future. The occurrence of any adverse health, safety or environmental event, or any changes,changes or additions to, or more rigorous enforcement of, health, safety and environmental standards, licenses, permits or other approvals could have a significant impact on operations and/or result in material expenditures.

We rely on the use of technology and information systems, many of which are controlled by third-party service providers, which may not be able to accommodate our growth or may increase in cost and may become subject to cyber-terrorism or other compromises and shut-downs,shutdowns, and any failures or interruptions of these systems could adversely affect our businesses and results of operations.

We rely heavily on certain financial, accounting, communications and other data processing systems. We collect, store and use large amounts of sensitive information, including personally identifiable information, through our information technology systems. Our information technology systems face ongoing cybersecurity and cyber-terrorism threats and attacks, which could result in the failure of such infrastructure. We may in the future be subject to cyber-terrorism or other cybersecurity risks or other breaches of information technology security, noting the increasing frequency, sophistication and severity of these kinds of incidents. In particular, our information technology systems may be subject to cyber-terrorism intended to obtain unauthorized access to our proprietary information, personally identifiable information or to client or third-party data stored on our systems, destroy or disable our data, and/or that of our business partners, disclose confidential data in breach of data privacy legislation, destroy data or disable, degrade or sabotage our systems, through the introduction of computer viruses, cyber-attacks and other means. Such attacks could originate from a wide variety of sources, including internal actors or unknown third parties. Further, unauthorized parties may also gain physical access to our facilities and infiltrate our information systems or attempt to gain access to information and data. The sophistication of these threats continue to evolve and grow, including the risk associated with the use of emerging technologies, such as artificial intelligenceAI and quantum computing, for nefarious purposes. We cannot predict what effects such cyber-attacks or compromises or shut-downsshutdowns may have on our business and on the privacy of the individuals or entities affected, and the consequences could be material. Cyber incidents may remain undetected for an extended period, which could exacerbate these consequences. The costs to eliminate or address the foregoing security threats and vulnerabilities before or after a cyber-incident could be material. A significant actual or potential theft, loss, corruption, exposure, fraudulent, unauthorized or accidental use or misuse of investor, policyholder, employee or other personally identifiable or proprietary business data, whether by third parties or as a result of employee malfeasance or otherwise, non-compliance with our contractual or other legal obligations regarding such data or intellectual property or a violation of our privacy and security policies with respect to such data could result in significant remediation and other costs, fines, litigation and regulatory actions against us by governments, various regulatory organizations or exchanges, or affected individuals, in addition to significant reputational harm and/or financial loss, and it may not be possible to recover losses suffered from such incidents under our insurance policies.

Data protection and privacy rules have become a focus for regulators globally. For instance, the European General Data Protection Regulation (“GDPR”) sets out data protection rules for individuals that are residents of the E.U. The GDPR imposes stringent rules and penalties for non- compliance.non-compliance. Other countries where we operate are enacting or amending data protection, artificial intelligenceAI and other technology laws to empower regulators to impose financial penalties and injunctions on certain data processing activities, which could have an adverse effect on our business.

For economic efficiency and other reasons, weBrookfield may enter into insurance policies as a group (which may include BN) that are intended to provide coverage for the entire group. Where group policies are in place, any payments under such policy could have a negative impact on other entities covered under the policy as they may not be able to access adequate insurance in the event it is needed. While management attempts to design coverage limits under group policies to ensure that all entities covered under a policy have access to sufficient insurance coverage, there are no guarantees that these efforts will be effective in obtaining this result.

The growth of our business relies on continuous fundraising for various private and public investment products, and retention of capital raised from third-party investors. We depend on our business relationships and our global reputation for integrity and high-caliber asset management services to attract and retain investors and advisory clients, and to pursue investment opportunities for our clients. Our business relationships and reputation could be negatively impacted by a number of factors, including: poor performance; actual, potential or perceived conflicts of interest that are not adequately addressed; misconduct or alleged misconduct by employees; rumors or innuendos; or failed or ineffective implementation of new investments or strategies. If we are unable to continue to raise and retain capital from third-party investors, including from BN, either privately, publicly or both, or otherwise are unable to pursue our investment opportunities, this could materially reduce our revenue and cash flows and adversely affect our financial condition.

In addressing these conflicts, we have implemented a variety of policies and procedures; however, there can be no assurancesassurance that these will be effective at mitigating actual, potential or perceived conflicts of interest in all circumstances, or will not reduce the positive synergies that we seek to cultivate. It is also possible that actual, potential or perceived conflicts of interest, if not properly addressed, could give rise to investor dissatisfaction, litigation, regulatory enforcement actions or other detrimental outcomes. See “Risks Relating to BAM — Our organizational and ownership structure may create conflicts of interest that may be resolved in a manner that is not in our best interests or the best interests of our shareholders”.

Continuation of rental income is dependent on favorable leasing markets to ensure expiring leases are renewed and new tenants are found promptly to fill vacancies. It is possible that we may face a disproportionate amount of space expiring in any one year. Additionally, rental rates could decline, tenant bankruptcies could increase, and tenant renewals may not be achieved, particularly in the event of an economic slowdown.

Part of BAM’s growth strategy involves seeking acquisition opportunities. We will face competition for acquisitions, including from our competitors, many of whom will have greater financial resources than us. There can be no assurance that we will identify and successfully complete acquisitions that will advance our growth strategy, or at all. Though we are not currently pursuing anyAny strategic acquisitions, future acquisitionsacquisition will likely involve some or all of the following risks, which could materially and adversely affect our business, financial condition or results of operations: the difficulty of integrating the acquired operations and personnel into our current operations; potential disruption of our current operations; diversion of resources, including our management’s time and attention; the difficulty of managing the growth of a larger organization; the risk of entering markets in which we have little experience; the risk of becoming involved in labor, commercial or regulatory disputes or litigation related to the new enterprise; the risk of environmental or other liabilities associated with the acquired business; and the risk of a change of control resulting from an acquisition triggering rights of third parties or government agencies under contracts with, or authorizations held by, the managed assets being acquired. It is possible that due diligence investigations into businesses being acquired may fail to uncover all material risks, or to identify a change of control trigger in a material contract or authorization, or that a contractual counterparty or government agency may take a different view on the interpretation of such a provision to that taken by us, thereby resulting in a dispute.

Even if our asset management business’ direct participation is intended to be of a temporary nature, our asset management businesswe may be unable to syndicate, assign or transfer its interest or commitment as our asset management business intended and therefore may be required to take or keep ownership of assets or securities for an extended period. This would increase the amount of our asset management business’ own capital deployed to certain assets and could have an adverse impact on our asset management business’ liquidity, which may negatively impact its ability to meet other financial commitments.

Our revenue, net income and cash flow, substantially all of which is derived from our asset management business,flow can vary materially due to our reliance on incentive distributions and performance-based returns, such as carried interest. We may experience fluctuations in our results, including our revenue and net income, from quarter to quarter due to a number of other factors, including timing of realizations, changes in the valuations of our funds’ investments, changes in the amount of distributions, dividends or interest paid in respect of investments, changes in our operating expenses, the degree to which we encounter competition and general economic and market conditions. Achieving steady growth in net income and cash flow on a quarterly basis may be difficult, which could in turn cause our dividend and our ability to pay dividends to fluctuate and lead to large adverse movements or general increased volatility in the price of the Class A Shares. We also do not provide any guidance regarding our expected quarterly and annual operating results. The lack of guidance may affect the expectations of public market analysts and could cause increased volatility in the Class A Shares.

The varying frequency of payments of our different funds and strategies will contribute to the volatility of our cash flow. Furthermore, we earn this incentive income only if the net asset valueNAV of a vehicle has increased or, in the case of certain vehicles, increased beyond a particular return threshold, or if the vehicle has earned a net profit. Certain of these vehicles also have “high water marks” whereby we do not earn incentive income during a particular period even though the vehicle had positive returns in such period as a result of losses in prior periods. If one of these vehicles experiences losses, we will not earn incentive income from it until it surpasses the previous high water mark. The incentive income we earn is therefore dependent on the net asset valueNAV or the net profit of the vehicle, which could lead to significant volatility in our results.

In 2021, we created a business group in partnership with Oaktree to serve the global wealth management channel, delivering access to Brookfield and Oaktree’s private and public funds. In October 2025, Brookfield and Oaktree announced that they have agreed on a proposed transaction whereby Brookfield will acquire the approximately 26% interest in Oaktree that it does not already own. Our goal is to increase the number and type of investment products we offer to high-net-worth individuals and mass affluent investors in the U.S. and other jurisdictions around the world. In some cases, our unregistered funds are distributed to retail investors indirectly through third-party managed vehicles sponsored by brokerage firms, private banks or third-party feeder providers, and in other cases directly to the qualified clients of private banks, independent investment advisors and brokers. In other cases, we create investment products specifically designed for direct investment by retail investors in the U.S., some of whom are not accredited investors, or similar investors in non-U.S. jurisdictions, including in Europe. Such investment products are regulated by the SEC in the U.S. and by other similar regulatory bodies in other jurisdictions.

BN will exerciseexercises substantial influence over BAM.

After giving effect to the 2025 Arrangement, BN owns approximately 73% of the Class A Shares. As a result, for so long as BN maintains a significant voting interest in BAM, it will have the ability to exert substantial influence over many matters affecting BAM’s business, including: (i) the composition of the Board of Directors of BAM and, through thesuch Board, any determinations with respect to the business plans and policies of BAM, including the appointment and removal of its officers; (ii) determinations with respect to acquisitions of businesses, mergers or other business combinations; and (iii) BAM’s capital structure, including financing activities.

BN is not required to maintain any ownership level in BAM and may sell the Class A Shares it owns to a third party without the consent of BAM shareholders. Similarly, if a third party were to acquire a significant ownership of BN’s Class A Shares and appoint new directors or officers of its own choosing, it would be able to exercise substantial influence over BAM’s policies and procedures and exercise substantial influence over BAM’s management. Such changes could result in BAM’s capital being used to make acquisitions in which BN has no involvement or to make acquisitions that are substantially different from those targeted by BAM’s current growth strategy. Additionally, BAM cannot predict with any certainty the effect that changes in the ownership of BN would have on the trading price of the Class A Shares or its ability to raise capital or make investments in the future, because such matters would depend to a large extent on the identity of the new owner and the new owner’s intentions with regard to BAM. As a result, BAM’s business, financial condition and results of operations may suffer.

If BAM is classified as a passive foreign investment company (“PFIC”) for U.S. federal income tax purposes, a U.S. Holdertaxpayer that owns Class A Shares could be subject to adverse tax consequences, including a greater tax liability than might otherwise apply, an interest charge on certain taxes deemed deferred as a result of BAM’s non-U.S. statusstatus, and additional U.S. tax reporting obligations. In general, a non-U.S. corporation will be a PFIC duringfor a taxable year if, taking into account the income and assets of certain of its affiliates, (i) 75% or more of its gross income for such year constitutes passive income or (ii) 50% or more of its assets produce,during such year produce or are held for the production of, passive income. Passive income generally includes interest, dividendsdividends, and other investment income.

Based on its current and expected income, assetsassets, and activities, BAM does not expect to be classified as a PFIC for the current taxable year or in the foreseeable future. However, the determination of whether BAM is a PFIC depends upon the composition of its income and assets and the nature of its activities from time to time and must be made annually as of the close of each taxable year. The PFIC determination also depends on the application of complex U.S. federal income tax rules that are subject to differing interpretations. Thus, there can be no assurance that BAM will not be classified as a PFIC for any taxable year, or that the IRSInternal Revenue Service or a court will agree with BAM’s determination as to its PFIC status. Holders of Class A Shares that are U.S. Holderstaxpayers are urged to consult their tax advisers regarding the application of the PFIC rules, including the related reporting requirements and the advisability of making any available election under the PFIC rules, with respect to their ownership and disposition of Class A Shares.

There can be no assurance that Canadian federal income tax laws, the judicial interpretation thereof, or the administrative policies and assessing practices of the Canada Revenue Agency (“CRA”) will not be changed in a manner that adversely affects BAM and/or holders of Class A Shares. Any such developments could have a material adverse effect on the holders of Class A Shares or our business, financial condition and results of operations.

We operate in countries with differing tax laws and tax rates. Our tax reporting is supportedconsistent bywith the tax laws in the countries in which we operate and the application of tax treaties between the various countries in which we operate. Our income tax reporting is subject to audit by tax authorities in the countries in which we operate. Our effective tax rate may change from year to year, based on changes in the mix of activities and income earned among the different jurisdictions in which we operate, changes in tax laws in these jurisdictions, changes in the tax treaties between the countries in which we operate, changes in our eligibility for benefits under those tax treaties, and changes in the estimated values of deferred tax assets and liabilities. Tax laws, regulations and administrative practices in various jurisdictions may be subject to significant change, with or without notice, due to economic, political and other conditions, and significant judgment is required in evaluating and estimating our provision and accruals for these taxes. Such changes could result in a substantial increase in the effective tax rate on all or a portion of our income.

Governments around the world increasingly seek to regulate multinational companies and thetheir applicationuse of differential tax rates between jurisdictions. This effort includes a greater emphasis by various nations on coordinating and sharing information regarding companies and the taxes they pay. A number of countries across the globe have also agreed to implement a “two pillar” plan for global tax reform, developed by the OECD/G20 Inclusive Framework on BEPS, to address perceived base erosion and profit shifting (“BEPS”) by some multinational groups. Governmental taxation reforms, policies and practices could adversely affect us and, depending on the nature of such reforms, policies and practices, including the implementation of the BEPS proposals in the jurisdictions in which we operate, could have ana greater impact on us.us than on other companies. As a result of this increased focus on the use of tax planning by multinational companies, our company could be subject to negative media coverage, which may adversely impact our reputation.

In 2024,2025, global GDP growth is expectedestimated to have risen by 3.2% compared to 3.1%3.3% in 2023, above the projection of 2.9% at the beginning of 2024. This economicEconomic activity wascontinued to be supported by lowereasing inflation,inflationary steadypressures, resilient employment growth,conditions, and lessthe restrictivegradual normalization of monetary policy.policy across most advanced economies. Labor markets continued to ease,rebalance, though unemployment rates generally remained atlow orby historical standards. Headline inflation in most advanced economies remained near historicalcentral lows.bank Additionally,targets, headlinewith services inflation has now returned to target in a number of advanced and emerging-marketwage economiesgrowth despiteproving lingeringmore pressures in service sectors.persistent.

Consolidated and Combined StatementStatements of Operations

The following table summarizes the Consolidatedconsolidated and Combined Statementsstatements of Operationsoperations for the Asset Management CompanyBAM for the years ended December 31, 2024,2025, 20232024 and 20222023:

The asset management businessBAM primarily generates revenue from fees earned pursuant to contractual arrangements with funds, publicly traded vehicles, and investorsinvestors, as well as transaction and advisory fees. These fees include base management fees, incentive distribution rights,fees, and certain advisory fees. Base management fees are long-term, recurring in nature, and correspond to fundraising activity, net asset valuesNAVs of certain of our funds, and market capitalizations of our publicly traded vehicles, specifically BIP, BEP and BBU. Incentive distribution rightsfees are performance fees earned from BIP and BEP for exceeding predetermined distribution thresholds, are long-term, and are not subject to clawback. Incentive fees also include performance fees earned from BBU for exceeding the current high watermark threshold and are not subject to clawback.

The asset management businessBAM is entitled to carried interest allocations assuming certain investment returns are achieved, as well as incentive management fees in certain of our structures where we are entitled to contractual fees from an investment fund based on achieving prescribed investment returns.

The composition of our revenues will vary based on market conditions and the cyclical nature of our businesses. Carried interest allocations generated by our funds and associated carried interest compensation are driven by the performance of the underlying investmentsinvestments, as well as overall market conditions. Fair values are affected by changes in the fundamentals of our investments, the industries in which they operate, the overall economy, and other market conditions. The impact of fair values of our underlying investments throughout market cycles may result in material increases or decreases to carrycarried interest generated, net of expenses.

Expenses within our asset management business primarily include employee base compensation, bonuses, and share-based compensation. Period over period changes in employee base compensation and bonuses generally result from changes in headcount and annual salary changes. Share-based awards are granted in the first quarter of each year and generally vest over 5 years. Equity settled compensation awards vest on a graded basis over the vesting period and cash settled share-based compensation awards are recorded at fair value quarterly based on the trading price of BAM Ltd. Class A Shares. Therefore, for cash settled share-based compensation, an increase or decrease in the share price of BAM Ltd. will result in share-based compensation expense or recovery.

Revenues for the year ended December 31, 20242025 were $4.0$4.8 billion, which represents aan decreaseincrease of $82$837 million or 21% compared to $4.1$4.0 billion of revenue for the year ended December 31, 2023.2024.

Base management and advisory fees for the year ended December 31, 20242025 were $3.0$3.4 billion, which represents an increase of $191$427 million or 7%14% compared to the year ended December 31, 2023. The increase was predominantly driven by the AEL Mandate, resulting in $49 billion of inflows of Fee-Bearing Capital, as well as annuity-related inflows and other insurance capital generated in BWS.2024. Management fee revenues also increased dueby to$123 incremental contributionsmillion from capital raised for the fifth vintage of our latestreal estate flagship funds,fund, $114 million from capital deployedraised acrossfor the second vintage of our global transition flagship fund, and $65 million attributable to fundraising from our perpetual infrastructure complementary strategies,strategies. asIn welladdition, asmanagement fees increased $55 million from insurance capital inflows from BWS and $44 million from a higher trading price of BIP, BEP, and BBU. These increases were partially offset by lower$17 trading pricesmillion of BIP, lower netfees assetfrom valueearlier of BPG, and the end of the investment period of certainvintages of our olderreal vintageestate funds.flagship funds and certain infrastructure funds as a result of monetizations.

Incentive fees for the year ended December 31, 2024,2025, were $424$560 million, an increase of $48$136 million or 13%32% from the year ended December 31, 2023,2024. This increase was primarily driven by higherBBU performance fees of $95 million as a result of the share price exceeding the previous high watermark. In addition, incremental incentive distribution fees earnedwere duerecognized toas a result of a 6% growth in BIP dividends of $24 million and BEP's5% growth in BEP dividends of 6%$17 and 5%, respectively.million.

Realized carried interest allocations were $25 million$nil for the year ended December 31, 2024,2025, which represents a net decrease of $26$25 million compared to the year ended December 31, 2023.2024. Realized carried interest allocations in the current and prior year were predominantly due to dispositions within our first real estate flagship fund and certain other real estate fund strategies. All realized carried interest income in bothfor the year ended December 31, 2024 and December 31, 2023,2024, net of carrycarried interest compensation related to mature funds and are attributable to BN through our redeemable preferred shares.

Carried interest allocations generated by new funds are 66.7% attributable to the asset management businessBAM and 33.3% to BN. Within the Consolidatedconsolidated and Combined Statementsstatements of Operations,operations, carrycarried interest allocations are presented on a 100% basis and the portion attributable to BN is presented in Netnet Incomeloss Attributable(income) attributable to Non-Controllingnon-controlling Interest.interest in consolidated entities. Unrealized carried interest allocations attributable to BAM were $629 million for the assetyear managementended businessDecember were31, 2025, compared to $257 million for the year ended December 31, 2024, compared to $109 million for the year ended December 31, 2023.2024.

Interest and dividend revenue for the year ended December 31, 20242025 was $143$98 million, which represents a decrease of $29$45 million compared to the year ended December 31, 2023.2024. The decrease was primarily due to the lower deposit balance held with BN driven by the acquisition of our incremental approximately 4.5% interest inincome Oaktree,earned our acquisition of an interest in Castlelake, as well as other strategic acquisitions made during the year. In addition, the funding of working capital requirements further decreasedon our deposit balance with BN.

Other revenues were $440 million for the year ended December 31, 2024, an increase of $91 million compared to the year ended December 31, 2023. Other revenues are largely comprised of recoverables from BN related to share and performance-based compensation as defined by the RelationshipServices Agreement, fund expense recharges, and incentive management fees earned on certain funds. The increase compared to the prior year was due to higher incentive management fees earned, fund expense recharges and increased recoveries in share and performance-based compensation. Share-based and performance-based award expenses that are recoverable from BN are recognized in other revenues with the offsetting expense recognized in compensation and benefits, and carried interest allocation compensation, respectively. Other revenues were $535 million for the year ended December 31, 2025, an increase of $95 million compared to the year ended December 31, 2024. Of the total increase, $45 million was due to higher recoveries in share and performance-based compensation. In addition, the increase was also driven by $38 million of general operating cost recoveries from affiliates.

Other operating expenses are comprised of professional fees, facilities costs, as well as costs directly associated with our fundraising and investment functions. Other operating expenses were broadly consistent with the prior year at $354 million for the year ended December 31, 2025, compared to $347 million for the year ended December 31, 2024, compared to $342 million for the year ended December 31, 2023. The increase was primarily attributable to the growth in our business relative to the prior year.2024.

Compensation expenses related to carried interest allocation compensation werewas $93$146 million for the year ended December 31, 2024,2025, which represents ana increasechange of $7$53 million compared to the year ended December 31, 2023.2024. This was primarily driven by higher relative valuation gainsvaluations across certain renewable, infrastructure, renewable, and private equity funds compared to the prior year. The carried interest compensation expense associated with mature funds is fully recoverable from BN. Carried interest compensation expense on new funds was $7$53 million during the year.

In terms of economic conditions in the U.S., real gross domestic product (“GDP”) is estimated to have grown by 1.3%1.7% for the quarter ended June 30, 2026, compared to an increase of 2.1% for the quarter ended March 31, 2026, compared to an increase of 0.5% for the quarter ended December 31, 2025.2026. U.S. inflation accelerated over the second quarter of 2026 with estimates reporting that the annual U.S. inflation rate increased to 3.5% as of June 30, 2026, compared to 3.3% as of March 31, 2026, compared to 2.7% as of December 31, 2025.2026. The U.S. unemployment rate saw a modest decreasemovement to 4.2% in June 2026 from 4.3% in March 20262026, according to data from 4.5%the inU.S. DecemberBureau 2025.of Labor Statistics. As of AprilJuly 2026, the International Monetary Fund projectedestimated that the U.S. realeconomy GDPwill growthmove ofmodestly 2.5%to 2.3% in 2026 and 2.2% in 2027,2027 comparedfrom with 2.1%2.0% in 2025, whileon notingaccount of the solid consumer demand and continued uncertaintyAI related to inflation, energy prices, geopolitical developments, trade tensions and the pace of artificial-intelligence-related productivity gains.investments.

The U.S. Federal Reserve (the “Fed”) maintained the Federal Funds target range at 3.50%–3.75% in MarchJune 2026, extending its pause following a series of rate cuts in late 2025,2025. While the Federal Open Market Committee acknowledged that economic activity continues to expand at a solid pace and signaledlabor amarket data-dependentconditions approachremain amidresilient, elevatedit macroemphasized uncertainty.that inflation remains above its 2% objective, reflecting ongoing supply-side pressures, particularly from higher energy prices. The FedJune highlightedSummary balancedof Economic Projections revised down the median GDP growth forecast for 2026 while raising inflation projections. The U.S. Federal Reserve continues to indicate that future policy decisions will depend on incoming economic data and evolving risks to both inflation and the labor market, with geopolitical developments and energy prices adding to uncertainty. The latest Summary of Economic Projections indicates inflation expectations have been revised modestly higher, while growth and labor market forecasts remain broadly stable. The Fed continues to guide toward a gradual easing path, with only one rate cut expected in 2026, reflecting persistent inflation pressures and a more cautious policy stance.growth. During the quarter ended MarchJune 31,30, 2026, the 10-year government bond yields increased 0.15%14 basis points in the U.S.United States.

Outside the U.S., GDP growth in the Eurozone remained subdued over the firstsecond quarter of 2026, with ECBactivity indicatorsproving pointing to continuedresilient but modest expansionamid earlyelevated ingeopolitical theuncertainty year,and albeit with a weaker outlook due tohigher energy shocksprices. andAt heightenedits uncertainty.June Themeeting, the European Central Bank keptraised its three key policy rates by 25 basis points, bringing the deposit facility rate unchangedto over2.25%, in response to increased inflationary pressures stemming primarily from the quarter,recent followingenergy aprice series of cuts beginning in mid-2025, while maintaining a cautious, data-dependent stance amid persistent services inflation and geopolitical uncertainty.shock. In China, real GDP is estimatedslowed to have grown by 4.8%4.3% for the quarter ended MarchJune 31,30, 2026, updown from 4.5%5.0% in the lastfirst quarter of 2025,2026, drivenas robust export growth was offset by strongweak exportsdomestic and early-year policy support.demand. The 1-year prime rate set by the People's Bank of China was 3.00% as of MarchJune 31,30, 2026, unchanged from DecemberMarch 31,31 2025.2026.

For the quarter ended MarchJune 31,30, 2026, the S&P 500 was downup by 4.6%,14.9%, the MSCI Europe Index was downup 1.6%,by 9.2%, the MSCI Asia Index was downup 0.6%,21.0%, and the MSCI World Index decreasedincreased by 3.9%.13.3%. During the quarter ended MarchJune 31,30, 2026, U.S. investment grade corporate bond spreads (BofA US Corporate Bond Index) widenedtightened by 1114 basis points, and the high yield credit spreads were updown by 4471 basis points.

1. Includes Oaktree employees that willhave become BAM employees following the completion of the Oaktree Acquisition and approximately 1,500 fully-dedicated Brookfield operating employees, that are integral to the business, including individuals focused on our core investment strategies and those undertaking various corporate activities.

•We are one of the world’s largest investment managers in infrastructure, with $255$262 billion of AUM and $109$114 billion of Fee-Bearing Capital as of MarchJune 31,30, 2026.

•We manage Brookfield Infrastructure Partners L.P. (“BIP”), one of the largest, pure-play, publicly traded global infrastructure platforms, which is listed on the NYSE and TSX and had a market capitalization of $28.5$29.3 billion as of MarchJune 31,30, 2026.

•We are one of the largest investors in energy investments, with $142$144 billion of AUM and $72$74 billion of Fee-Bearing Capital as of MarchJune 31,30, 2026.

•We also manage Brookfield Renewable Partners L.P. (“BEP”), one of the world’s largest publicly traded renewable power platforms, which is listed on the NYSE and TSX and had a market capitalization of over $23.1$24.4 billion as of MarchJune 31,30, 2026.

•Distributed energy and storage, which provides small-scale generation that can be locally installed, and pump storage facilities, and battery energy storage systemsfacilities;

•We have one of the best long-term track records for investing in private equity with $160$166 billion of AUM and $48$54 billion of Fee-Bearing Capital as of MarchJune 31,30, 2026.

•Our thematic private equity strategy, Brookfield Financial Infrastructure Partners,Partners ("BFIP"), focuses on investments in asset-light financial infrastructure companies that underpin the global financial system.

•We manage Brookfield Business Corporation (“BBUC”), which is a publicly traded global business services and industrials company focused on owning and operating high-quality providers of essential products and services. BBUC is listed on the NYSE and TSX and had a market capitalization of $7.0$6.8 billion as of MarchJune 31,30, 2026.

•Leading service providers to large-scale infrastructure assets, including a leading provider of work access services, modular building leasing services, and a leading global provider of lottery services and technology solutions;

•Operationally intense industrial businesses that benefit from a strong competitive position, including a leading global provider of advanced automotive battery technology, a leading global aviation services and leasing business, and a leading manufacturer of engineered components for industrial trailers and other towable equipment providers, among others; and

•EssentialLeading essential services providers, including the largest private sector residential mortgage insurer in Canada, a leading value-add distributor of telecom equipment, a leading provider of software to automotive dealers, one of the largest private school operators globally, and a leadingan American private education company.

•We are one of the world’s largest investment managers in real estate, with over $277$280 billion of AUM and $103$104 billion of Fee-Bearing Capital as of MarchJune 31,30, 2026.

•We manage $20$19 billion of Fee-Bearing Capital in Brookfield Property Group (“BPG”) as of MarchJune 31,30, 2026, which we invest, on behalf of BN, directly in real estate assets. BPG owns, operates, and develops iconic properties in the world’s most dynamic markets with a global portfolio of retail, multifamily, logistics, office, hospitality, land and housing, triple net lease, manufactured housing, and student housing assets on five continents.

•We are one of the world’s largest and most experienced credit managers, with $365$416 billion of AUM and $282$326 billion of Fee-Bearing Capital as of MarchJune 31,30, 2026.

•We have approximately 1,800 investment and asset management professionals globally, including Oaktree employees that will become BAM employees following completion of the Oaktree Acquisition,globally that are focused on our credit strategies, investingincluding former Oaktree employees who joined Brookfield following completion of the Oaktree Acquisition. These professionals invest across a broad spectrum of investments,credit leveragingstrategies, thecombining capabilities we have organically built in collaborationorganically with the capabilitiesthose of the leading credit managers with whom we partner. Our partner managers where we have significant non-controlling ownership stakes include:

The following table summarizes the condensed consolidated statements of operations for BAM for the three and six months ended MarchJune 31,30, 2026 and 2025:

For the three months ended MarchJune 31,30, 2026 and 2025

Net income for the three months ended MarchJune 31,30, 2026 was $586$1.2 million,billion, of which $617$904 million was attributable to common stockholders. This compares to net income of $507$584 million for the three months ended MarchJune 31,30, 2025, of which $581$620 million was attributable to common stockholders.

Revenues for the three months ended MarchJune 31,30, 2026 were $1.3$1.8 billion, which represents an increase of $257$663 million or 24%61% compared to $1.1 billion of revenue for the three months ended MarchJune 31,30, 2025.

Base management and advisory fees for the three months ended MarchJune 31,30, 2026 were $860$919 million, which represents an increase of $23$104 million or 3%13% compared to the three months ended MarchJune 31,30, 2025. Management fee revenues increased by $44$34 million from a higher trading priceprices of BIP, BEP, and BBUC. In addition, thefee increaserevenues was drivenincreased by $15$35 million from net insurance capital inflows from BWS and $27 million attributable to fundraisinginflows forfrom our infrastructure and energy perpetual strategies,strategies. $11The millionremaining increase was attributable to growth of our mandate with BWS,fundraising and $8 million from capital raiseddeployments foracross thevarious secondlong-term vintageprivate offunds ourand globalcomplementary transition flagship fund.strategies. These increases were partially offset by $63 million of catch-up fees earned from the fifth vintage of our real estate flagship fund in the prior period, as well as $19 million of lower fees from as a result of realizations from earlier vintages of our flagship real estate flagship and certain infrastructure funds. The remaining increase was attributable to fundraising and growth across various long-term private funds and complementary strategies.

Incentive fees for the three months ended MarchJune 31,30, 2026, were $130$128 million, an increase of $13$12 million or 11%10% from the three months ended MarchJune 31,30, 2025. This increase was a result of an increase in BEP and BIP's quarterly dividenddistributions over the prior period of 5% and 6% respectively.

Realized carried interest allocations were $16 million$nil for the three months ended MarchJune 31,30, 2026, whichand werethe predominantlythree duemonths toended dispositionsJune within30, certain private equity fund strategies.2025.

The unrealized carried interest allocations of $96$553 million for the three months ended MarchJune 31,30, 2026 represents an increase of $94$616 million compared to the three months ended MarchJune 31,30, 2025. The grossThis increase ofis $128 million compareddue to the prior year reflects changes in fund valuations associated with the first and second vintages of our global transition flagship fund for $33$261 million, various private equity fund strategies, including the sixth vintage of our private equity flagship fund,strategies for $60$121 million, and various earlier vintages of our real estate flagship funds for $25 million. This was partially offset by a $32$21 million decrease primarily driven by lower unrealized carried interest generated in the fifth vintage of our infrastructure flagship fund relative to the prior period. In addition, certain real estate other long-term funds saw increases of $39 million, and a $177 million increase related to unrealized carried interest losses recognized in the prior period on earlier vintages of our flagship real estate funds. This was partially offset by $8 million in lower unrealized carried interest generated in the sixth vintage of our private equity flagship fund.

Carried interest allocations generated by new funds are 66.7% attributable to BAM and 33.3% to BN. Within the condensed consolidated statements of operations, carried interest allocations are presented on a 100% basis and the portion attributable to BN is presented in net loss (income) loss attributable to non-controlling interest in consolidated entities. Unrealized carried interest allocations attributable to BAM were $141$387 million for the three months ended MarchJune 31,30, 2026, compared to $86$94 million for the three months ended MarchJune 31,30, 2025.

The following table presents the change in accrued carried interest in new funds by investment strategy for the three months ended MarchJune 31,30, 2026.

Interest and dividend revenue for the three months ended MarchJune 31,30, 2026 was $21$27 million, which represents ana increasedecrease of $8$7 million compared to the three months ended MarchJune 31,30, 2025. The increasedecrease in interest and dividend revenue was primarily dueattributable to lower interest revenue following the sale of the GEMS investment to our consolidated fund BPE, partially offset by higher interest income earned on our deposit with BN.

Other revenues are largely comprised of recoverables from BN related to share and performance-based compensation as defined by the Services Agreement, fund expense recharges, and incentive management fees earned on certain funds. Share-based and performance-based award expenses that are recoverable from BN are recognized in other revenues with the offsetting expense recognized in compensation and benefits, and carried interest allocation compensation, respectively. Other revenues were $207$117 million for the three months ended MarchJune 31,30, 2026, ana increasedecrease of $102$63 million compared to the three months ended MarchJune 31,30, 2025. The increasedecrease was primarily attributable to higherlower recoveries of $79$43 million related to share and performance-based compensation,compensation asdue to a resultlower trading price of newlyBAM issuedClass shareA basedShares compensation awards that are recoverable as well as the modification of BN DSU awards duringin the period.

Total expenses for the three months ended MarchJune 31,30, 2026 were $733$659 million, an increase of $231$102 million or 46%18% compared to the three months ended MarchJune 31,30, 2025.

Compensation and benefits for the three months ended MarchJune 31,30, 2026 waswere $355broadly consistent with the prior year at $405 million, which represents an increase of $96$1 million compared to the three months ended MarchJune 31,30, 2025. TheDuring increasethe wasperiod, primarilythere attributable towere higher compensation costs of $30 million from the ongoing growth of our business, offset by a $29 million decrease in share-based compensation expense of $79 million related to our share and performance-based awards.awards Thedue increaseto wasa thelower resulttrading price of newBAM grantsClass issuedA as well as the partial settlement of BN DSU awardsShares during the period. The remaining increase is due to higher compensation costs from the ongoing growth of our business.

Other operating expenses are comprised of professional fees, facilities costs, as well as costs directly associated with our fundraising and investment functions. Other operating expenses for the three months ended June 30, 2026 were $98$118 million, which represents an increase of $20$36 million compared to the three months ended MarchJune 31,30, 2025. This increase was driven by higher operating costs from our growing business and one-time adjustments related to the 2025 Arrangement in the prior period.business.

Compensation expenses related to carried interest allocation compensation was $211$51 million for the three months ended MarchJune 31,30, 2026, which represents a change of $65$35 million compared to the three months ended MarchJune 31,30, 2025. This was primarily driven by higher relative valuations across certain infrastructureprivate equity and energy funds compared to the prior year.period. The carried interest compensation expense associated with mature funds is fully recoverable from BN. Carried interest compensation expense on new funds was $68$55 million during the year.three months ended June 30, 2026.

Interest expense for three months ended MarchJune 31,30, 2026 was $37$53 million, which represents an increase of $34$22 million compared to the three months ended MarchJune 31,30, 2025. This was primarily driven by BAM's increased borrowings from our debt offerings relative to the prior period.

Interest expense of consolidated funds for the three months ended MarchJune 31,30, 2026 was $10$7 million, which was primarily driven by borrowings made by BSI II andof BMEP which has been consolidated for the first time in whichthe current period due to BAM holdsholding a sufficient interest to require the consolidation of the funds.fund.

Other Income (Expenses), Income, net

Other income,(expenses), income net for the three months ended MarchJune 31,30, 2026 was $10$29 million, compared to Otherother expenses,(expenses) income, net of $69$68 million in the prior period. This gross increaseexpense decrease was driven by revaluationunrealized ofmark-to-market investmentsmovements transferredon topartner consolidatedmanager funds,puts and calls, as well as a mark-to-market loss of $19$8 million on our investment in BSREP III during the three months ended MarchJune 31,30, 2026 compared to a loss of $40$39 million during the three months ended MarchJune 31,30, 2025.

Other income, net of consolidated funds for the three months ended MarchJune 31,30, 2026 was $11$70 million compared to $14$13 million in the prior year.period. BAM holds a sufficient interest to require the consolidation of BPE, BMEP, BSI II, and BREVA-H. The decreaseincrease is mainly driven by the fair value changes of investments held by BPE,BPE and BMEP and BSI II in which BAMwere holdsnewly aconsolidated sufficientfunds interestcompared to require the consolidationprior of the funds.period.

Our share of income from equity method investments for the three months ended June 30, 2026 was $70$199 million compared to $58$181 million in the prior year,period, an increase of $12$18 million. The increase was driven by higher unrealized carryearnings from PrimaryCastlelake Waveand Concora of $12$24 million, $23 million and incrementalof earnings from theU.S. Manufactured Housing following its acquisition ofduring Concorathe of $11 million,period, partially offset by $11$39 million of lower earnings from Oaktree.Oaktree due to higher carried interest compensation costs in the period.

Income tax expense was $110$162 million for the three months ended MarchJune 31,30, 2026, which represents an increase of $35$87 million compared to the three months ended MarchJune 31,30, 2025. The increase in income tax expense was predominantly driven by a higher taxable income compared to the prior period.