KKR & Co.’s assets under management grew 3% in the fourth quarter and 5% from a year earlier, to $98.6 billion as of Dec. 31, the alternative investment firm’s financial report released Tuesday showed.
The fair value of KKR’s private equity portfolio appreciated 2.7% in the quarter and 12.8% for the year. Also during the quarter, KKR held first closes of KKR European Fund IV with $1.6 billion in capital commitments; KKR Infrastructure Fund II with $2 billion; and KKR Special Situations Fund II with $700 million in capital commitments so far. The firm also held a second close of KKR Lending Partners II with $500 million in capital commitments. None of these was a final close.
KKR’s fee-paying assets under management in the fourth quarter totaled $83 billion, up 2% from the third quarter and up 7% for the year.
KKR reported a net loss under GAAP of $600,000 for the quarter and net income of $477.6 million for the year ended Dec. 31, down from net income of $277.9 million in the third quarter and net income of $691.2 million at year-end 2013.
Management fees totaled $178 million for the fourth quarter, up 2% in the quarter; for the year, the fees totaled $726 million, up 12% from the year-earlier period.
KKR also earned $38.7 million in monitoring fees in the fourth quarter, up from $30.4 million in the third quarter and a total of $135.2 million in monitoring fees at year-end 2014, up from $120.3 million a year earlier.
Transaction fees were $53.3 million in the fourth quarter, down from $158.6 million in the third quarter. KKR earned $459.7 million in transaction fees for the year, up 36.5% from $336.7 million in 2013.
In the fourth quarter, KKR gave $25.7 million in fee credits, down from $61.8 million in the third quarter. Fee credits for all of 2014 totaled $222 million, up from $166.6 million as of year-end 2013.
Realized performance income was $198.6 million in the fourth quarter, compared to a total of $244.3 million in management, monitoring and transaction fees less fee credits. Realized performance income was down from $246 million in the third quarter. For the full year, realized performance income was $1.2 billion, up from $690 million in 2013.