The 2022 Annual Report highlights Carlyle’s deep team and strong financial results. Our diversified platform is positioned to unlock long-term shareholder value in a dynamic operating environment. Designed for growth and built on resilience, we have tremendous opportunity in the year ahead.
Letter to Shareholders
This past year saw extraordinary geopolitical and economic challenges globally, and a leadership transition for Carlyle, and has proven the strength and resilience of our firm. We are extremely grateful to our global leadership team and colleagues around the world who have maintained focus and dedication during a volatile market environment.
Carlyle generated strong financial performance in 2022, including record Fee Related Earnings (FRE) and Assets Under Management (AUM). Our full-year results showcased the breadth and talent of our team and our focus on investment performance for our limited partners. The firm’s strong results highlight how we’re positioned to drive sustainable long-term growth for all our stakeholders.
Carlyle is moving into its next phase of growth. I am writing this letter alongside our newly appointed Chief Executive Officer, Harvey M. Schwartz. He is a leader with a proven track record of success that will help Carlyle build on our momentum and drive further transformation and growth. Harvey is a widely respected business-builder and seasoned operator with significant experience growing and leading a wide range of businesses. He has a proven ability to navigate challenging environments and develop the talent and organizational structure to drive growth and create value.
Early last year, a sharp change in market dynamics made 2022 one of the most difficult market environments in more than a decade for investment managers.
At Carlyle, we took decisive action, focused on our proven investment strategy, and our teams remained resilient. Our business centers around raising new capital, investing that capital wisely, and delivering returns on that investment throughout all economic cycles.
Our investment teams around the world used market dislocations and the power of our global platform to identify opportunities that generate long-term value for all our stakeholders. We believe our focus on investment risk management and portfolio construction is a differentiating characteristic in our industry. This has been a hallmark of Carlyle since we began investing more than 35 years ago, and will be for years to come.
In 2022, we deployed a record $35 billion across our equity, credit, and solutions strategies. Looking forward, Carlyle remains well-positioned with $72 billion in dry powder to deploy opportunistically across diversified markets. Our record deployment will continue to deliver earnings growth.
It is worth repeating, we delivered record Fee Related Earnings of $834 million in 2022, an increase of 40% over 2021. This is illustrative of our strategic focus on growing FRE and diversifying our earnings mix. We have now grown our FRE at a 34% average annual rate over the past five years. Our AUM grew 24% year-over-year to a record $373 billion, as investors continue to entrust us with an increasing amount of their capital.
We continue to diversify our platform, with approximately two-thirds of our fundraising last year from areas such as Global Credit, Global Investment Solutions, natural resources, and real estate. We see significant capital raising opportunities across the entire platform in 2023 and beyond, and we expect to raise more capital in 2023 than we did in 2022.
As we look to the future, tremendous opportunity exists to grow and continue to transform Carlyle while delivering sustainable results. Our deep leadership team will capitalize on the momentum we have delivered to create value for our investors and shareholders.