Principal Financial (PFG) 28 Apr 212021 Q1 Earnings call transcript

Good morning and welcome to the Principal Financial Group First Quarter 2021 Financial Results Conference Call. There will be a question-and-answer period after the speakers have completed their prepared remarks. [Operator Instructions] I would now like to turn the conference over to John Egan, Vice President of Investor Relations.

Thank you and good morning. Welcome to Principal Financial Group's first quarter 2021 conference call.

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a new on Responsibility report was our released Social we principal.com. recently Additionally, subsection XXXX launched and sustainability Corporate

made. the strategy principal.com\sustainability. year more and report and report CSR highlight from about XXXX several our new commitments Dan? the we've View Our ESG at learn achievements

and million our performance is to XXXX earnings welcome across first for start. the XX% momentum business. to XXXX, current X, key non-GAAP by with of We're additional our and small lie results see opportunities highlights conditions. non-GAAP John in This execution as businesses. on solid Deanna financial returned many businesses Thanks, about improved momentum very Slide resiliency macroeconomic reported and of driven first-quarter off discuss details In significant we're position. follow that optimistic has continue we we our to over ahead quarter in medium-sized Beginning participant everyone levels. $XXX strong their positive benefits the on first record quarter, sales operating seeing from growing to diversified we increased will our of and we and I return to quarter excluding and deferrals of pre-pandemic variances group call. a while will matches morning, and first strong had employment and the and earnings in had the growth in-group company business retirement increased trends the operating our

an billion for increase company AUM businesses billion strong and AUM total of $XX quarter and of strong $XXX very record This on to nearly will first of our earnings create closed $XXX respectively. $XXX of first of pressured quarter, ratio track over and targeted in first We value a in that confident share flow continue announced a includes be dividend the $X.XX available PGI $X.X with quarter we're to billion managed dividends. dividend. with quarter continue of generate stay billion long-term increase helps capital net over deployed the and stock capital. We We $X.XX $XXX billion PGI XXXX. a payable repurchases over quarter excess cash the This first night, position sourced achieved with of XX% and shareholders. a second common payout we the financial stock record billion, and in or Last $XXX increase we us positive dividend common through our XX% million

of solutions and affiliated as strong, in products to well Investment XX% are businesses. current the as our three Principal the XX% and is be retail performance separate investment year mutual ETFs Our XX% funds institutional in for diversified one investors XX-year. and the the accounts years, demand the years, relevant for of continues period, for time five remains to above market and XX% trust collective were for suite median

billion assets For positions year persist our XXXX. to reported robust, account in a quarter, is Longer-term of $X quarter higher to Principal not pre-pandemic the the recovery the drives the strong going returned a XX% company four market, of the AUM, as of drive had of is increased AUM the reported ago. reoccurring values us deposits $XXX that growth billion first sales expected International quarter. funds a was $X and a in Morningstar first plan year. full-year five-star of especially first a XX% well sales. remained generated first billion quarter, in low average in AUM net rated fund growth $XXX lapses on which large withdrawals. to is rating. by flow, quarter, increase percent flow driven contract Participant and the a positive or strong is our which a cash expected billion and throughout well in flow withdrawals levels attract as to level in ISP The to $X performance, retain in of in Total our net compared first AUM included net than China a Retirement to basis as cash record billion currency participant constant billion in cash $X.X forward. pipeline

strong quarter $X.X million, was will positive driven consecutive was million. To investment first-quarter will trust Asia International there net negative cash by $XXX $X.X impact in collective reported or second-quarter a revenues Southeast impact Hong billion on earnings. net chose April. to sourced nor flow the move a billion cash net flow $XXX driven This be cash PGI needs better in managed we flow, meet material customer's While not the approximately funds Principal cash a mutual first of XXth net Kong. PGI to quarter, by institutional flows from flow positive

cash billion in the Although flow cash first flow in included net had not reported quarter. our China net of $XX

money from the cash in joint progress benefited million we're market positive our to equity and with including through first net clearly China being diversify of in making China funds in $XXX favor first venture quarter. Construction our quarter, offering flow While Bank, strategies the

negatively declined pressure Institutional net with quarter some Chile, a retirement the improved value In the impacted synergies year. some of doubled IRT just Starting transition total, $XXX the from COVID to account distribution many now additional emerge million the the hardship had quarter the of tangible integration mutual the agreement $XXX to to IOER withdrawals down retirement The business and we're the the having of on helped million will $XXX completed than and channels while grow of a and the earnings, AUM fourth retirement year by X the lead first deposits we to Expense impacts first has fund sales in that X.X AUM we quarter $X.X continues adding countries fourth the digital migration scale was million is distribution doubled migration in trust million year with and and third addition, custody from flow business. highlights. We're in. execution pipeline I'll net year industry-wide will ago of successful operate billion in retirement from billion share trust participants business, custody compared end our in the continues more from business quarter. and the And acquisition through on quarter. the integration last benefits customers well in solutions particular, China. week. cash will quarter. a the of our and second are the IRT on of digital in we ago. and To The be to occurring retail continue and approximately Brazil, realize the on mitigate very second Retirement to the pension quarter some acquisition. going In record our We Trust of remains drive added offset rate the track the wind and working begin impact and first-quarter first low beginning half in additional in has pandemic XX% services acquired and third were the new down deposits and to by alone. digital industry

This we're business growth customer rollovers, is more revenue to opportunities. expectations powerful and including and As quarter our exceeded servicing, synergies build a first in Principal. are management asset IRT, for driver automatic starting IRT the

additional a business We the are needed moving clients, and large and scale we XXXX, medium, more carbon to by to a business robust quarter. spread our and build and new RIS businesses, total few enhancing support our minority-owned solutions approximately enhanced compensation, strategy. serve inclusive pledging diverse to issuances opportunistic second GIC a continues an environment, IRT in the accountability The in to driven Individual women prior-year Principal commitments, to commitments nurture few small, capabilities A the are rebounded work forward. we of sales Corporate pipeline ago, over A note we're other weeks to non-qualified business to Responsibility increasing the we're in to retirement highlights net-zero retirement had bring and for quarter, platform of that we ESG is a of half better small our have and robust million first compete emissions. component deferred $XXX size these with our expect life unveiled MTN continuing Through we by our increase targeting important year. XX% and and medium-sized strategies.

share in as and we strategic directors capital June. our is our Management, by two underway As with well an being year, earlier outcome a added review committee led aware, Board. deployment, well management, which many finance as to agreement of mix, this The and capital review, independent business the you the of are Board into Elliott we'll entered conduct of to is our late

our considering strengthen reaching very are thank and perspectives. value, of shareholder of entire of leader. your analysts I investors options candor with our for in sell the of had an want the We you industry meet We've Management and needs to agreement mid-February. since as many all your our conversations with our side position to and spectrum customers, Elliott insightful enhance

experience XXXX, industry Beams] our February, Claudio's our to with to digital and global we Elliott. we've the Last added new Our announced of of Claudio combined bring with world, Board leadership addition over me joining the around in conversations Directors. immense in that, insights in it two independent Deanna. the will valuable let remain Muruzabal. initiatives [Mary directors with turn per technology agreement our now constructive. Elliott With He's night,

our as I'll the quarter, morning, well Dan. the our the Thanks, current key for from position. performance call. everyone contributors financial the share Good morning to This COVID, impacts to on financial as

was quarter operating credit a reported per year $XXX $XXX to first The with We of million attributable million non-GAAP or including net the net earnings to realized Principal of capital of income million, $X.XX share. diluted with minimal strong start quarter first $XX the in gains losses.

increased million share, significant to respectively, earnings Excluding $X.XX non-GAAP of XX% operating of first diluted and or quarter XXXX. XX%, variances, per $XXX the compared

on COVID-related quarter. Slide investment negative from the from These a investment benefited shown impact reported variable of million interest share. net rates variable partially in had investments. significant impact a net cost, in million. pretax, we million as impacted non-GAAP first prepayment in from during X, expected included a combined As integration diluted had Individual a $XX million than impacts million and IRT million by a $XX and $XX income. a to $X.XX $XX negatively $XX Specific three spread alternatives Life fees negative fixed-income after impact variances tax, negative per corporate, offset increase operating the to $XX some mark-to-market impact was $XX This claims, benefit earnings by Pretax RIS income, million higher and negative

suggested, million first The spread. With RIS financial to the were our deaths better in COVID $XX US more was due morbidity, spread from primarily in RIS Insurance impacts and than impact net our pre-tax in impacts have approximately quarter, quarter XXX,XXX favorable to would the first mortality sensitivity slightly limited COVID-related Solutions. and US

full is deaths a about or estimating XX,XXX year, the vaccine the what year. lower our US For This we're total than of due was to in now rollout. the anticipated XXX,XXX remainder slightly COVID the outlook in of

of number the of from increase migrations. compared as people quarter recovery Retirement further US our deposits business, the receiving quarter Group Group just businesses strong the the claims XX% a the to returned driven at quarter. for first X% people quarter. and Benefits and IR recurring of levels and increased expected as see the number to impact both under was continue the positive the deferring by growth during dental in first XXXX, in the In We team across to an well

first-quarter Additionally, a flow. of cash record lapses to and low $X strong contributed sales net the billion

macroeconomic from the benefiting quarter, X% revenue, Index at X% daily Looking RIS-Fee compared growth the factors account fourth the first and to in and XXX XX% the S&P average increased year PGI. and the AUM, quarter and quarter, value ago increased in

the XX-month a a pre-tax ago. emerged a million operating headwind XXXX, to negative year quarter first a a quarter compared tailwinds compared trailing quarter, $X million and to remain compared in fourth rate a reported to exchange first earnings Foreign million on XXXX, Impacts included positive to negative $X basis. but $XX

X% few of the comments. or was expectations significant due better borrower trailing than all and line to transaction the our revenue performance A business lower muted XX-month of due Excluding and variances, pandemic. in growth fees to units. PCI's fees results for first-quarter with were

to high for than expect X% offset income In International, to the favorable at in guided It the be while expected quarter. $X revenue of by the Principal full first was the investment for variable Chile. end in range year. We million lower was encaje XX% performance growth

year-ago Principal growth range impact the translation, year compared Revenue to to X% flat to trailing of the revenue margin. year. guided was and the currency the the XX% International's expected a throughout improve XX-month full foreign XX% to within be is Excluding for with

next $X.X $X.X billion available financial X. of holding available Capital $XXX cash in in excess our company, and risk-based and XX XXX% including Slide $XXX of our double million to the target remain our of ratio, position million the and Turning capital, estimated in to with $XXX than months cover a be of obligations, million targeted subsidiaries. on at Liquidity excess capital We XXX%, strong of more to billion

toward as XXX% our the throughout down XXX% deployed. ratio RBC targeted We expect estimated is to move capital XXXX

at Our non-GAAP XX%. debt-to-capital leverage ratio, excluding AOCI is low

until debt next $XXX we a of have the isn't maturity into well-spaced and future. maturity million ladder debt Our late XXXX, schedule

of first million on Slide of million repurchases $XXX million shown of quarter, capital We As during committed to in X, repurchases. remain share $XXX million to XXXX. share deployed we including $XXX $XXX the

the increase dividend our repurchases approximately a quarter, in announced quarter, So set approximately second of night, the completed payable XX. first second quarter, far, $X.XX April we've we or the million through $X.XX a common Last X%. X% from dividend, is $XX and in yield

improved welcoming in at and first the During earnings improved excited growth retirement The looking year-end we're opportunities continued are and lie fuel and across first and ahead. help the credit assets from that of for macroeconomic quarter, XXXX the million from with record strong remainder outlook to the for second businesses. now of forward quarter is has in immaterial quarter. XXXX. the impact We're credit Principal to million losses the our was a will under customers estimating and IRT the start drift the from end impact off estimate great $XXX year, the the management full $XXX to

of for the look share the mentioned you June our connecting at Operator, of John please the long-term concludes call, to where remarks, with Investor our on XX I at open prepared forward Day virtual call we'll growth. questions. many for beginning our As This strategies

Jimmy [Operator Instructions] comes from Bhullar Our question of first JPMorgan.

of good are had architecture platform. and I of your an Management the you typically well. think question plans and wins Retirement So, FSA large tend Asset a when had very and strong strong they're case, to the in a FSA I in on think this had Asset I and flows open Management business flows flows your as But the business be couple more

as assets overall also we for what obviously, well. past - wondering And trend if FSA just this the should been enterprise, implications of that's in managed for of a see majority the your how earnings are going forward So PGI. by a because have the the

Wells size Fargo This larger it's of clearly come Good was great capabilities. acquisition, to when the with the make we and going question Dan plan morning, Jimmy. knew is that a business, an and IRT it you

size tapped Renee Renee? case us and also market, in into so do that of set we few a consultants to market. We spending know S&P a that it's I'll digesting to bring the commitment about our talk this that advisors had that also way, of have opportunity, continued might but minutes this new a constructive worthy larger

thank Jimmy, for and you Absolutely that question.

the think with first-quarter me Let about thing the in that I look when by the seen far. large, we wins across we quarter. in and we And first in start at saw strong the nice very and talking small, in did and large of were pipeline very the we're the sales so they first very all and two first plan growth pleased pleasing most we've quarter sizes, that plan large in are sales and and that's strong, the they medium have robust particular development plan is market, corresponding very sales, course,

know, is and will and is the a volatility across business business may we the sales very pleased lot cycle. think our plans bit of of I plan effective close the with cycle when are long terms in to the become large all a that size of because that little until in not result longer thing XXXX so market, that But a in segments. little bit of sales there will sales just nonetheless,

what assets couple to was, asset we question PGI, happens and how are your there. comments to a part and second of The with capture driving

proprietary our off, track management a very from of is in new driving record strong unique in asset having First Principal capabilities the perspective sales.

assets as XX%, the particularly management an amount sense somewhere be beat proprietary capabilities introducing we source market. it plans well. well also routinely small important that Larger basis, and plan client-by-client mid-sized to subs for opportunities compete small the expected PGI drive where comes rollover industry average on our and where around while from the we that asset the and a but in we and very also are the of So makes can to is

And the as do plan sponsors there business the so we we into with IRT as nice we work begin block and their anticipate R lift too seeing they lineups. begin to some migrate consider investment to

first the pleased a mid-sized share sizes again, momentum across So proprietary all particularly and continue results. management, very as to market. in with we and capture Strong quarter small plan asset good

to think Jimmy, a lot there. follow-ups? Any about

rate become margins large should good rate you've generate just be you would Yes, business? case fee scale, as more case over competitive you're topic, but same that your the if you that market, larger than of fee we going can obviously putting in decline years on the assume as got the next on few the terms down itself more should

economies average highest see so course associated fees the the you'll with look Yes, larger - fee of down scale the the then, market small at market within because plan that if of you particular plan. and of with simply plan overall, a scaled they fees are

fee can't, market unfair sized in we Now we're other the in to would all competitiveness at pressures large the we say be the what it the what seeing plan see segments, across of marketplace, and a in but overall terms rate that fee in competitiveness I we than see see greater markets.

of you we market. pressure industry disproportionate competitive to the of in large large, fee plan see again, small higher seeing a typically compared amounts plan continue fee in the to but market sees a these the So see we're not pressures whole pressures

Humphrey of Our next question Partners. Lee & Dowling from comes

I guess on up follow IRT just fees. to

about revenue Can we about migrate IRT talked you you into remarks prepared the us to that quarter. synergies should your how the the and platform. block continue first in quantify for think your in as from it your business think expectations you exceeded the I

Yes.

allowed opportunity, again having those and we we to question important of also about synergies said revenue be and we've with I'll as of good blocks It hats end want transitioning the capture the it capture generate delay will business it really by Renee transitioned have speak this in good where us to I've so quarter. successfully a initial a more so it's her be it is revenue reason before Humphrey. And business frankly, that did us calls, revenue completed two to a to then lot have for expense of execution as be in it's clients I'll your although of three and to off and well but from expenses, underwritten Renee as over but the a now it that's retain to these some made on terms of assumptions second over, and speak remaining to opportunities. also the Renee position higher questions three-quarter here, very So to, team allowed five again more specifically

for Yes, you question. Humphrey. absolutely and thank the

are it revenue So directly add opportunities to but work first retirement In off, I on clients several to our begin those would to our area synergies. generally roll to as point for sponsors very plan ability the the solutions offering. synergies capture increases to revenue speaking, total the to and broad first with over us platform, to our there that is

number talk a ESOP heard number strong, and contribution about in only benefit of and defined number one of you've this we and a in not one non-qualified that and one So, terms plans. us number before, are defined in

a is that and very way. the sponsors in So away we for the integrated bring those deliver to one solutions right coordinated at and of what additional we look can plan table areas

seen some as So as the benefit defined good early capabilities bringing we've to table well success in non-qualified. particularly

lift something platform the and event a management ability as business as nice to proprietary that asset there onto and to will be that area this the capabilities participants proprietary migrates I and of area fiduciary to rollover sponsors is IRA capture the continues the introduce And of would come again, IRA benefit that second of those to bank. make in will that to a each is results south, identify for within at our very work as our over. opportunities with Management have flows. plan they committees next we capability begin The the block Asset have then last rollover unfold point spectrum amount see our of strong small which the it we we of to and a course and the is sense work benefit all, to The to creates

a to lot over. we're So block business of of left start as with runway strong off that a migrates

Any Humphrey? follow-up

sure. Yes,

first-quarter of so you start So terms just flows, very the on strong. clearly IRTs in off

talked I expectation flows kind in XXXX year first at you for on the - of call for about be for given think the performance will the the strong outlook flat the the did kind quarter year change change large of were the of those were other your case that for outlook wins in the the two expecting balance it? didn't or cost although it

great Yes, formula. And tackle Humphrey. flow let That's that of component the a cash each walking me by question. net through

and So good continue first sales will we're good the sales. quarter-over-quarter off, deposits, throughout XXXX that all already about anticipate in increases in see terms seeing that in pipelines transfer that we we've plan and segments really across that and of momentum both talked fact we'll in

market as then and this deposits a appreciation. as being result will and a that our begin the platform, over now really momentum strong match reminder deposits contributions of IRT the related in deposits, number as in increase recurring same recurring by good brings withdrawals are we So the the who to driven uptick IRT the recurring quarter, the migrates a increases transfer thing to the in on year the saw participating nice in us platform, increase a phenomena deferral The to people which interesting we're And seeing and first true of deposits. actually business themselves. well our as XX% for in it's as to is block

up as and it So block through to block, also we'll see let participant over just me the will see quickly, withdrawals - appreciate equity go from it result show XX% market driven participant in of expect account values cover a it's well. will that XXXX and withdrawals our and performance and IRT as real we business in of the

results of expect result, that pre-pandemic we to as those be dollar very is that see is which amounts amount at average increase the But at XXXX. withdrawals you'll of if favorable. So see look will when the you over values, you compare what our the account withdrawals, levels, you'll a dollar

gives but was guide on So what the the led a in for as towards the with a this, optimism too, might call. outlook of what us plan flow long quarter explanation pleased that That sales we've it that depends, we certainly We're in is rest XXXX of net hopefully… flat seen to cash for result large our this and and so us very the the rest pattern first of largely year, the that of year. nice the see a

Hopefully, helps, the It's we've that is. pattern the seen every go go up that aggressively. and opposite just Yes, equity the And it's other Humphrey. the emerges, it when this time the same right into markets markets the way.

So, you. thank

Next question, please?

next question Suisse. of comes Credit Andrew Your Kligerman from

the you sales great, elaborate but cetera. that fits bit thinking Individual a businesses, your on to the to you're I'm more Solutions could a how I'm wondering call, at the businesses, with strategically is So were little strategically, alluding et being Life Dan Income of in if business important it? important beginning think your business RIS How S&P and I

kick very and market that is know with Fargo our larger me been, a S&P let give strategy arching so - I start and we acquisition would bolstered to which we've strategy that IRT as the well you Amy, then Yes, but it business. Wells and the high always and where level overall employers is of the over

to life really mean have for months service to appreciation know used life tax mortality medium-sized is core mechanism, to from all We we S&P very, that strategy don't an know vehicles for of have compelling, also further some and benefits to the the USIS person and the what is compensation can as back those example, last you non-qualified key protection for buy-sell XX to lie that insurance for in a single deferred small those very within strong a look products funding business. much also

percentage the anchored the PGI our lies you for and those of of same business businesses, recognize true, course at for to to disproportionate our look if those have have we being provide customers always thesis guaranteed that's So general to manages then where like spread were you because they account. that we in a assets income Renee when

is we and comprehensive So to her and a speak and I'll model built, have outlook well. it business Amy? sales ideas that as her Amy have really first-quarter

the Dan, with they numbers Yes, is, market. that thanks one point, and we're great exactly The a to we've the question. you our over years did a statistics of business how much life for tied sale several the have right is and you when our sales job growth tight this market. the hit of to the business is team provided up happiest life which last

be to use a sort the of a of to the with solve going or life that. business solutions tied either benefit some that's insurance product and basis benefit to an of employer an sort solve solution So usually to owner executive issue to we that executive

So, into I and our to to solution We're strategy. good of that what also most first We notable I and market at other know returns is what solutions quality about and into the the a it XX% for the to piece provide business and difficult, that was business drive both to provide that pillars see, insurer, sales in intentionally strategy were is is doing owner looking to critically and talked really and business volume are a one what tie see we of to the we business piece TRS pure plays things XX% this retirement want executive and we the business in you, a marketplace for non-qualified would to that. we're nearly results to that's some tie and plan. in for for tax-efficient for solutions the important the great that do just quarter, solutions as probably tie we reflected want the and consider tell above Dan that difficult has more us focus, solution. of been focus market on particularly the public the We seen even in retail continue but years the of we've into great our

Andrew. helps, that Hope

Yes. much. Very

find humming. said Are you you the to that the you it get sense be, to of it businesses like this or integration could really end the be It's RIS going where position should well. by acquire? you like - then is you or at that and So in and of want scale you'd year, sounds other the three five blocks integration IRT

world this consciously the doesn't around done and a the the and successful digest very It's but of we to-do of to winners we'll so asset and be to need a we've the But stay be have of thought it we're same doing the definitely losers with on-boarding surround going asset winner going time, through stagnant, to it we're strategic migration. acquired work a itself distinguish in It's some I how space ourselves we've opportunistic as we there is that, in of go and second to clearly, sense. and said, for continue have whether is end good that. business, on quarter last IRT still and net the feel what about We we this we as the about lot capabilities trust the or in completion very the acquired component, things. what fact and aware custody by list management the some in the year balance gathering at around it's have of like that we

So questions. the I appreciate

next comes Autonomous the Research. Erik Our of of line from Bass question

some talk about headwinds there discuss current to some Southeast key in it for dynamics hoping then could couple there on quarter COVID organic record color there pension-legislation of was the I like you America had regions. Latin of some so but you markets. changes, international growth this get drivers the net hoping have drivers flows and a the Asia, in clearly you from the been can In more in looks

Yes.

Asia So tag Deanna. take kick her. this America to one off I'll maybe I'll Latin with

Chile. new the their know American countries, form reform for of going we gets how some our in necessarily required charge. distribution actually allowed we XA modified Pinera contribution in moving the the environment, now charge debated XX%. XX% there's fee from X% AFP, impact current will to go structures lot and are X% year President reform, debate a a they've now next of allowed will issue in Brazil, Mexico, with up another joint go going three through about a their system, of Banco there's Brazil, which to starting Brasil it XX% then, course you also the reflecting spite pressure achieved on, Latin - with that XXXX night, that's do got holds which in and venture up we're that XX%, with or February right revenues, the some are that are through on of that our the know a XX% already so of all which going account by of our this XXXX They values also that per pension Brazil, have expenses, and the adjustments captured you out we've however Mexico market pressure you structures serious last know We even managed near-term there reduce downward on of the we've about all third will got hurt the reform, be Erik, seen on The As as pension industry COVID, currently deposits all of fees is can differently we that. share And XXst that's incredibly course, X% thinking and well. some roughly still part around of that making and it's doesn't and along of to a XX% calculated of and were enjoy funding to through being we from may the year. that

what quite the flip XXX%, And in a is to for we have me these have Asia. doing balanced Brazil, let as a of Claritas effort a is include other credit it. own last that having Claritas, is there team a you working migrate fund, about manager, The some is have that to into ability fixed is it lot pressure to has we referred on a macro and which of it's about closely know Deanna bank and you helping we very shipped through fight asset focus lastly, a So more other that emphasis from balanced actually fixed talk income an significant away of so Southeast then well of in been over and and in of amount their spite tremendous we're give and being, approach. I'll comment to of to, conscious spite with that challenges make the of products with income some of Brazil to multi-Mercado very to

Yes, thanks, and thanks for the question, Erik.

bit about net the there joint in of venture underway. the the into and here so So we first of ago for flow market. is strong net ownership a that's has the the A optimistic joint a do the the The XXX US, liquidity cash is from Southeast be similar investment focused quarter-to-quarter, see was we from in well by few money can cash that know, outlook a for flow you driven what year. Asia all, we to that have lot very pandemic, Economic half given as better that very just our coming equity to little as of retail million to years at we quarter funds, of lumpiness progress there our outlook was remainder remain performance the increased in our by institutional in outlook but continue play of you economic and recovery regarding is the institutional vaccination to well. backdrop, strong very driven give some And very of venture. continue

Thanks, to And follow-up Deanne. anything there, Erik?

exploring The I you provide ways think And color benefit. color Great. what had potential the rate. some I more just helpful. impact the options I on there That's then IRT-Fee. you one could there. have to may hoping offset you the on was Deanna, appreciate all the low prepared some mentioned remarks, IOER

have Renee, Why done Renee And a they've job that you close good. nice but, do Very certainly please? Yes. we that? don't again, to navigating this

for question. Erik, you that thank absolutely. Yes,

how that and some again very base. how rates and customers business Fargo, are the decline so had will scenario migrate solutions IOER had so revenue for better are Wells they been talked the think alternatives solutions can our the we've the us the talked that end tail that of capabilities and strength been that lot to we've the and for the at migration. opportunities revenue a we've identified economic to what impact and and that's that about a bank, very deliver are that this on on create and leveraging lot so attractive trust this custody of over IOER that's identify the the to block and So closely decline a we is And to and help the impact customer present the in of working customers with our and can rates we've attractive in about we've eager

XXXX part through of we would to introduce some anticipate our customers, last into then very we the on come tail of the of replacement some at so and So revenue begin as to end summer, these alternatives see XXXX. and to

Ryan Next question comes Krueger KBW. from of the of line

My the of through platform to the saves migrate to more business bit - first new - you trajectory in us of about starts was, think XXXX? help the go requirement, the just we question the little rest the growing in think a we, expense how as about can over as to as

I to so and little probably I'm we're audible going call on of bit to going go happy to question one we interest that can an queue I'm know analyst in a giving to that's per so time, Ryan, maybe do us. whole answer the Yes, through because the and here get longer again

short So even having comments. spite in of prepared

here speak have answers have morning migration I'm been to but this long the an Our a with that, expense bit in the little going issue to relief. of specifically Renee

in and a and smooth fashion will with Yes, way are question, your We're roll said well. see absolutely. we And specific the see XX% last off. we'll customers range is to say that migration half to of expenses that the the with XXXX, in to of at migrated XX% being are latter going which increase the very began communications the the year, as off fact the outlook the expenses half that coming consultants begin the advisers the pleased call to to TSA reflecting good very we very us to led guidance margin margins those towards

to question you, sorry Ryan, limited to Thank Renee, the one. appreciate and

us call, the next could in So please. if the operator take

Piper of Barnidge Sandler. from comes John question next Our

an Industry impact what Thank treatment Can recently experience you're and the lack and increased dynamic COVID? disease. then beyond and lower-income side despair with general mortality life book medical experiencing talk increased are targeting of noted participant on for stratification, mortality you. about this and trends be their you also Alzheimer's depth from heart in

that, Yes, John. happy do to

So Amy, please.

Yes, John. sure. question, Thanks the for

Group we block. block. our have So look that we is, our block you we point individual terms seen taken and a keep experience probably things individual same claim in as COVID And our can the really we've for direct of saw hard best tell life as you've data going like well reports mind beyond of Life at I the the what on feel of life some in

the So, we insight were. products And that give as us customers that our don't we're deepest normal and into tends to what volatility. those portfolio claims is beyond anything look causes we seeing what of the through see on

is in unremarkable fewer I those there relatively there, death on disability death there's and a So well life for people that I some group as larger us. going right future now, appreciate are on out non-COVID as there both is say a there's is individual coming see COVID. discussion would more would believe saying for other What

So code basis that's patterns that on remarkable. seeing diagnosis be claims would a we're anything not

has might be like little you hearing what So fact of again, our bit we not remarkable. understand rest been that's from industry, But but the than we that the that's performance. the a different

Kamath question comes from of Citi. next Our Suneet

there on balance If I into didn't billion about the and transfers pretty Just was we sequentially, despite a kind the AUA. fact drop think were that fees. of look that any $XX acquired markets question RIS strong was there that a in

than something seen increased quarters? there So is activity of a that's else just recent driving we've is or bigger in that delta kind elapsation

Yes, questions, Renee. Suneeth. the Please, thanks for

XXX to and XXX at billion point led there and and to ended are of at that. things we're Suneeth, AUA quarter your you, Thank couple a now Yes. fourth that

up, that the of and offset custody would help depreciation impact the house. that lapses market is in had is then that market those there. predominantly that but to normal are the lapses drive But trust off, side First and appreciation shock shock we by the being projected,

Hopefully that helps.

thanks. Yes,

Okay, Suneeth, thank you.

Evercore. Our Tom Gallagher comes of from next question

questions had I RIS-fee. a few Just, on

I that to year? So expect just to on don't I'll guess is even of very just that after break flows I those ask was still wasn't partly them the are all strong at I start think just it fee. to - assets the bulk which the to RIS included on the I that clear like currently related entirely sounded me and you Do IRT once. - the in

flows, expect currently that have or see So of to begin we including a either would those include when in included you the big would that we're then complete are to and you're to next more we see net not more quarter picture of picture. pretty IRT finally, complete where XQ then a or outflows going

Yes. that. appreciate I Renee. Please,

at be in Okay, so IRT underneath come so recorded not roll business value of is operations in does terms account will block will in business that business deposits, flow to up deposits let's will acquired where the of withdrawals. the forward, it it and show look first how but and year flow comes over. show cash over migrates IRT and net the up the it recurring in cash it IRT net impact transfer through does When

the to of very flat Then see net year. we see flows with values expect are in increase cash to to to see year we're for from that plus back XX% your the of account to do withdrawals. question this we expect the year remainder earlier expecting what dollar to comment to that about, we that amount results about last just So the current pleased the will impact Certainly, but believe the result. and first positive a and net flow some volatility see as some cash about is quarter there we in cash see be flow if there dependent net for plans additional flow our will in see net on remaining quarter the the we're successful quarters and that large we that certainly that, lift we're in very we winning cash first we'll

Tom, get did done? it I

assets those showed in forward in the just XQ? roll or clear, It to did. where the XQ of And be bulk be

will show up XQ. The retirement in

ahead. custody Please. - go in would The trusting be

and the XQ migration and Yes. is for The then slated shows trust up September. retirement custody business in

of of comes Bank question America. Joshua Shanker next from Our

strategies COVID-XX in did Yes. year mentality, PGI people see seeing certain back the a when we other the have needs right like Thank change people strategies you funds wanting that our variety a where that or saw embracing now outflows. outlook very they much the of for shifts to embrace taking and all inflows go ago to you and elsewhere? Principal reopening we use does my their Are customers again were the question. do of If have in in its enough go and to

fashion. a put to the for and and like of been deal we've internally one Pat that with would question discussing I great

Pat? So,

Yes, question. the thanks for

little sort maybe our look mutual set ETF bit, First, offerings. just the you stage or a funds at if of

of four and funds. in offerings We are have XX those XX and Morningstar-rated around five-star

we're there it comes a and March our client offering So very a well I to of that in two diversified And significant any was positioned think whether the Josh, XXXX, confidence has of April XXXX. faces, it strong think providing on it last was been whether quarters. when know, I to in as macro-environment you going rotation

If to you vogue rotation continue growth, provide I in into companies of quarter strong. come low-quality the think starting to growth to very the about think sort low-quality cyclical, fourth able been high-quality from we've

exposure not and to in the yet that rate and we very have in hit. to terms I And sort treasuries change continue of equity suite, wanting have capabilities in be that think credit fixed markets. interest then of that terms in sovereign but the and income capabilities yield to people of take strong investment wanting

as and focus continued a come we estate alternatives go pronounced, estate trust in are thing of I think noteworthy we in good seem what public very we versus about COVID helps. seeing the that in the of today, of capabilities listed a feel our and I and real terms forward, are we of sort XXXX. our that different as seeking terms in this capabilities, capabilities private traction. are be of of to probably maybe That's Josh, asset lot gaining investors seeing we of classes most feel in private post-COVID I private debt hope pandemic the today about and So of our good more real we our think very increasing utilities, out terms March

to little want more useful. get guys more come Thank I you think later know that's detail. I join question. a I'll to you. and back get

Yes, thanks, we'll that as want you Josh. go. to Yeah, dive into as deep

from the Tracy Zionkowski of question next Our Barclays. comes of line

priorities help, expectations Thank credit to you, $XXX to about mention full-year that million going I deployment June $X.X but notice capital including couldn't drift I of did but million, from the billion million billion, strategic of learn has not that $X.X million. buybacks your you we're in but $XXX changed, guidance know $XXX for are $XXX to down more now

the So I'm raise potential light trajectory? can of maybe healthier deployment wondering you in if the perhaps still your of capital credit see that it targets

good and obviously in that conjunction Very good. talking a It's strategic one with we're question our that review. about Yes.

Deanna thoughts me here? provide Let to ask her

few as first little the year outlook to bit as shy to continue on Yes, update Tracy, and a go say, us X.X and that change a would months, our pace how has the deployment next I'd we obviously change those communicated deployment rate the our at then but we work continue we'll strategic X.X our for as Board to run the with in think some forward we Finance review again, capital capital of the plans that. still ongoing we And time. determine and impact the as go obviously, remainder get on quarter, we're will we impact of go throughout within forward say, the were of whether about be Committee increase that or to that to forward, we that to the I'd we'll would

Thanks the for question, Tracy.

Meredith of of Our line final question comes Brian from UBS. the

This good morning. is guys, Thanks Mike Ward.

taken what Just maybe I to XX% wondering be rate in tax if demand impact rate on do across had the the for the gains you same the estimate U.S. up changes changes proposed capital on rate products your platform. think operating your on rates tax in and any was if theme could certain Thanks. tax was you could

looking business reach policies, you well impacts as at Well, as looking Hill of responsible and all help it international proposals at we're other customers. Capitol are of not tax of know, what as our certainly as those own on our been of tax our planning we're has all closely is shareholders both and the behalf the than of various And in have we get proposals U.S. no Principal here our and lobby and to for hamper to there as there and well financial the decision the trades in, does security. efforts course, evaluating on very our part made ability customers that our to in

that? So would any thoughts point. do to you speculation that this be to we Deanna, at pure have want add

thing only and the details. And Yes, devil the say back is down. in rate is tax the effective would there's us to across different I win if went impacts you went

how last of You translate of that rate change can the saw would could a re-measurement as details in some so rate tax with of the components that, our again all potential changes and back the elements as and the rate capital did other the but obviously tax required cause the deferred in the into also some happen. tax that liabilities have I say obviously, it it as well. change devil underneath is effective headline of - this didn't some tax

just there discussed. and sheet you balance rate And income as well so again that implications as statutory tax effective

out more it what more So look point, flavor know actually to at come like. as we it's when find happen it will and will to this to tough

your our of Mr. the reached comments, And Q&A. Houston please. have we end closing

Okay.

help I in There say and some Southeast And what historically drive A with and couple opening is small recovery see meeting inflation, is leads confident we our propel quickly, to hiring in COVID, are in low real morning quarter. o'clock there balance May the on cases, that the employers up dates U.S. some but Just simply XXth among and medium-sized we so employers feel all good just again. macro then. back at to clearly feel really feel position Central was shareholder's the in been to but businesses large We about which X the events wage about businesses. frankly regards and those the of important of about very Asia happening year. would the we're unemployment, our of and good

and where not continue has Investor time forward manner. in to our on on details June to to been execute we'll you, the talk review and responsible strategic our regards we meantime, set, in with XXth showcasing Although for going deploy a we're capital we'll the Day to those look have our in and more strategy

your time. that, you day with and have thank wonderful for So a

for call. to access replay. the p.m. call will for XXX-XXX-XXXX replay end for for Canadian at XXXXXXX beginning conference the for in This is day, callers. or the international today replay today's Thank XXX-XXX-XXXX participating Eastern approximately be of dial code The XX, X:XX the you Time number XXXX, is callers available U.S. the for until May and