KKR & Co. (KKR) 7 Nov 232023 Q3 Earnings call transcript

Ladies and gentlemen, thank you for standing by. Welcome to KKR's Third Quarter 2023 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.

I'll now turn the call over to Craig Larson, Partner and Head of Investor Relations for KKR. Craig, please go ahead.

operator. you, Thank everyone. Good morning, our third call. to XXXX quarter Welcome earnings joined Lewin, Nuttall, our This Co-Chief morning, Financial Rob I'm usual, Scott as Chief by Officer; Officer. Executive our and

measures that We'd a remind in reminder, And segment Investor our is our reconciled we'll Center on which figures the numbers release, we adjusted on refer to like report GAAP call, everyone share on as to available to press section are which kkr.com. basis. non-GAAP an the at

not do as which future statements, SEC forward-looking contain will to these release call performance. or earnings filings about refer well guarantee Please factors This events our statements. for our cautionary as

So through our the to Rob walk discusses to key before I'm begin, quarter's operating financial going results metrics.

be up distributable earnings and was to the million. trailing to of and $X.XX X% up of share over the earnings bright quarter quarter strategies. reporting infrastructure to $XXX compared for fee-related Management for by and us, across last months, growth our came Relapse been pleased Turning results have real driven and XX fees a after-tax per This XX% last XX XX% per of compared the over increasing fees $X.XX share. several the spot quarter. at in of in to XXXX management XX% QX estate We're months.

of at midpoint came of transaction Capital Net the the fee-related in guided Markets was and revenues. monitoring XX.X% fees from of our which right Fee-related million $XXX million range were quarter, $XXX business. at compensation our

XXXX. as well lower This Other of operating quarter to is compared were both expense actually figure QX last little million. $XXX expenses as a

the discipline time. growth really seeing you're us Here, for to invest same while our maintaining at continue

million $X.XX came I putting in share earnings ago. moment at fee-related figure So or together, the $XXX mentioned a per this

at that delivered this or talked up the been where We've margin, FRE excuse into consecutive XXth In here level, XX% and migrating areas, we've quarter being above mid-XXs. to and low about we feel XX.X%. our our me, FRE margin about margin this. margin the good on This in continue was this consistently has XXs QX, the from is very

realized up as quarter. performance $XXX realized were and our compensation from was income investment last over together performance businesses. million, well Realized activity Both estate again right both Xx the investment private performance the and $XXX increased in income income Realized as quarter income midpoints U.S. million. as exit equity our in investment ratios were both real at and generated

our operating were asset in So management earnings total, million. $XXX

a $XXX quarter XXXX. remains Global MetLife of last We to with Atlantic pretax million strong reinsurance block generating earnings. disclosed call. in close on the track on segment our front, To GA, again a quarter's on with had insurance transaction transaction very institutional spend moment GA's this QX on

$XX by to AUM our closing. approximately increase expect We upon billion

level pipeline looking GA's And of experienced on dialogue terms QX. of in remains in future an ahead, GA's individual GA in further activity block And increase activity and healthy. business,

as momentum business channel within to well. good overall, feel very So continues this

the billion or July partnership GA's Global the strength outset. execution acquisition level franchise, block the the of well In seen Xx up the billion. our $XX our really over this $XXX is MetLife AUM of totals Atlantic the in This of for high from as we've since XXXX. the forma view, of announcement KKR-GA power demonstrates now pro of as since

earnings share. per or aggregate, $XXX totaled So $X.XX our million P&L. after-tax back distributable to In

trailing well as earnings just the a quarter X Next, XX-month our summarized turning see of Page We performance period. as investment to for release.

IRR traditional quarter. to blended looking XX%. And the the strong up public figure and our quarter, recent stay mixed indices, on for broadly the funds, our flagship was XX to Looking page favorably at the at most months, our equity figures were is in portfolio for XX%. the in compare private up very The -- third metrics the over continues quarter, inception-to-date, performance X% which relative that at to

quarter X% down months. the XX In Real X% over estate the was Assets, real up last for and portfolio the

growth so the strong portfolios, remained as decline XX the rates across in well cap the over underlying NOI change you reflects Importantly, assumptions. as our rate interest has trailing see months

were was In last continued X% has for both X% the as and the credit, quarter and in in alternative Infrastructure XX is XX% the the resilient X%, months asset respectively, up over leverage up be months. the us. class quarter XX% and to in XX this composites over last up

a XX. for to Page And moment turning

performed. has $X.X capital equity manager as billion. Core third-party we've of largest the X/XX And portfolio our sheet. capital you balance the can includes sheet which of at the the billion on Our of of core value Today, investments fair was AUM, we PE page, see are balance off made private $XX with alongside

Core a is As strategy. PE reminder, investment a long-duration

that, have generally of whole We XX over at a investments stages to view, periods well strong are as in PE dislocation, the years. as months. helped hold and their we've in XX so cash-generative. XX- spans traditional COVID expect industries, cyclical really compared to see lower point such to the which more nature, The XX-plus growth more of to of portfolio range investments periods wide this these stable continued and less global, leverage These to is for during over early last in our is has our portfolio as

breadth, into depth, set to as us growth We about strategy an in to believers player since and believe earnings it's the treated class. it asset up our that in be building the this because collaborative our very can and to power that a drive We're where potential. global avenue we model, well really we culture got have area for and unlock this firmly best business big how continue class strategic started industry we us geographic ability the asset to business create, all including think

Rob. call to that with summary, And over the I'll turn

across across Despite what dynamic momentum, would thought significant this a our through we been it I areas. especially Craig. the lot, are go day-to-day. be key to operating ourselves environment, morning a strategic a with growth firm helpful amount has we find Thanks experiencing of what

our We are and today. uptick a I'll and each pipelines seeing take around monetizations, fundraising, noticeable you deployment through in

fundraising. to first Turning

This raised $XX the XX billion, quarter, billion. past bringing $XX to months we

are tough, have come or as fundraising While has been positioned though the the to we very the in flagship we're $XX a over peers. environment from the of strategies, feel our we next None fundraising differently period so. begin of LTM billion than that number our year which due has raised

of still is strong, all market wealth size ability environment in And Global Atlantic in continues the and our success around of and incredibly for Across strategies, well early, lot from momentum our while have rate to here. positioned. this KKR, remains our a and of conviction is really grow. continue to to the this us upside framework addressable our take share the private

continue of to our strategies scale. many younger Finally,

in bit detail. Looking a at more the quarter

suite of K Series our First, products.

a wealth traditionally serve the accessible not reminder, to As noninstitutional to clients. these been end primarily investments providing that globally, market are private access individuals have alternative with

that we were be We with manage, private estate closer X our to on is more suite vehicles all and ramp. to come. today, Two XX% ago, platforms, we more across platforms of real to private now years for wealth vehicles we classes: have this continue as number approximately XX these and of And major products to equity, that credit. added asset infrastructure,

$XXX a wealth infra and approximately equity private our million now raising products specifically, at are they month. Looking

So and really confidence expectations, start relative strong scale opportunity especially a for our our only of the in to long-term us, reinforcing the impact here.

we quarter, of Second, liquid and credit the strategies and private credit. in billion we in were raised capital active in $X particularly

our and $XX roughly private direct years $XX billion a AUM just from finance As in where credit significantly. credit up That's reminder, Today, X is of ago. lending scaled private asset-based AUM is comprised has total, Xx businesses, our billion.

$XX we well direct assets seeing have lending, management, through us a in In raise capital traditional raised as format, U.S.-focused the our strategy under of both billion in in as Europe. U.S. In for you're where fund quarter, evergreen structures we and variety forms. in the capital of

asset interest accounts. institutions raise we're allocations. fundraising outset as and part private seeing these the And separately perpetual managed a in in at permanent of for vehicles become to continue more and We're more our more mature BDC the capital our classes of

continuing we're now AUM billion ABF position of of here. close $XX is to our on X/XX. finance, asset-based In leadership as to build

in and opportunistic capital high-grade of both forms, strategies. raising ABF a are variety closed-end We including our in structures and fund open-ended

within There will at ABF as and be future quarters business, our in the categories. very investment remains really performance their to peer respective builds come ranking more all direct both back here strategies credit with of our leverage strong interest of lending This on of top the high. many in

peer credit strategy universes strategy investment in both As in opportunistic returns inceptions percentile our against their X their an the our and in top multi-asset ranked leverage example, since XXXX. credit our

of global twice fund. final close final to happened growth proven increase area is I equity Next the some third post fundraising which on helped that represents of behind billion. post XX% predecessor platform to companies an that the close deliver is the the announcements more Global wanted And its That investing $X.X solutions size also were predecessor commercial at totaling held Impact X/XX. its recent II III over We address billion, approximately problems Fund Technology our quarter $X Generation scalable over to this fund. in end

And Asia Chip. infrastructure

$X.X in sizable think here, dedicated making leadership Asia and fund, predecessor position another I billion we already fund and final and have yet have largest infrastructure to added our the of We that in billion our the not capital raised held platform $X.X cements is from This broadly. region close. it the more further have up franchise, the we infra

funds, $XX KKR. total for vintages still have is prior $X approximately that very are billion and billion from strategies in These AUM young all in This high-margin their capital X of aggregate, relatively us for today. across increased to

relative we fundraising accelerate we the will and As last to months. XXXX at to look XXXX, KKR expect XX

Equity our scaling alongside fund number flagships We to Infrastructure, continued the coming market, the Private opportunity private traditional and products Private Global format. Asia such wealth and are have as XX-plus for Americas including with in a of Equity, strategies

We investing are also strategy. launching climate a new

experienced a now infrastructure really is which our giving a can platform, team, We leader have real a become confidence player the fully into us recruited broader in we integrated space. scaled talented that and and

deployment. to next Moving

risk/reward continue be our to classes. on of across a here constructive very asset We number

in uptick investment we've an available We have dry June. deploy, billion about and since $XXX activity announced powder of seen to

small days a of only XX However, ended closed in that September portion XX. the

figures given pipelines here. an dynamic Capital help in We do investment increase QX. in our capital our revenues activity should in the expect QX to invested in addition This Markets

we And pick of the currently and strategies have the continued products. quarter up. quarter, today, income monetization realized of performance came monetization-related into look in has $XXX-plus totaled wide as Activity and on And $XXX to In variety revenue. quarter, investment million visibility the finally, million. activity a our our standing from fourth here we

of in carve-out equipment. investment within from we've the business a Japan-based our realizations semiconductor Private manufacturer in transactions of Kokusai We is Asia X Group. X is collaborated through December is It Electric. the the back Equity invested XXXX in One QX our in where Hitachi platform. production of Kokusai of

You've heard key theme number us as calls. these a on investment a carve-outs Japanese talk times about of

closing operational And XXXX end based the with Given listed positioned in Tokyo the marked of in multiple money since the a example in over largest-ever these us. the stock since Exchange well on well particularly our private XXx At on has equity-backed largest pricing, XX%. is week's skills, performed is our IPO IPO. The was latest up just This trading Kokusai together to the total feel for our on investment investments. basis. last gross now at Japan relationships approximately the price, and pursue Stock we October, region,

of company. continue We XX% the own to

result, In branding Japan. to our the as Private helps outcome opportunity K-Series addition likely, across positive also in products everything more we the this we also And do distribute as market. a Equity creates our investors, that Asia for IPO in

billion Turning to investments have We embedded as carried of whole. a the gains still in interest. firm our $XX-plus between

compared monetization-related of of to $X gains robust. beginning is at year. future revenue billion the the remains embedded around This the So

environment, in of amount embedded healthy what same XX% monetized while, a a roughly has So time, having been we're XX/XX. since up at volatile the gain that

and As continue we our growth our you to a as can really evolution. be excited management hear, team about

and We benefits business, doing on plan insurance executing across building private management what equity. from, and a are by, core have high-growth accelerated and asset of our been which we high-margin is very

With that, to happy I questions. Craig and Scott, your are take

line the with from is question first the And Instructions] Siegenthaler [Operator Bank America. Craig of of

ago, retail the press vehicles. X relationship to X So entered of that into your of reporting was weeks mega the sell some online with KKR brokers a

like KREST the this mass on selling the than your are different so high-net worth is products believe mainly to and affluent. wirehouses, approach I this mainly Now which is focused investors,

looking you and could wondering what was update strategy on the accomplish. I you're provide an if So to

you do want off? Craig, to kick

from we be don't start? We're think broker-dealers. you're on to top internationally. at the Craig, funnel broad Sure. what have end, on here focused be is going focused I the why private wirehouses U.S. going broadening main we're on takeaway and mentioning I on We're wealth the to the to focused going the focus independent in the be

broadening the we've with And that are tailored designed markets, products as geographically, as markets funnel a and ones that much can. the are for be going focus created those again, on to and we different

we making purchaser of topics the market, was One the could market. the not investor on qualified sure but focused accredited that appeal to particularly only we've been

of qualified Xx the or Again, purchaser a credit X investor market size market. is the

example wanting as one for funnel end as the can. that we of focus at broaden that's just again, So to a us much just is, top again,

only of it The is add, just strategy. thing I'd the Yes. think I Craig, part

really is around all global. approach It's It's world. broad-based. Our the quite multichannel

So what got was picked the element X up of U.S. that just in

comes from of line question Evercore. with next Glenn the Schorr Our

on, the how your And saw on have GA into ahead. net impact dynamic; thoughts went a you there? blocks or on little about environment, whether bit not more that cost guess, heard floated In the rules a quarter, your into income. for been I distribution bit. curious a, I plays your the the than out to much just more and, going I'm plays insurance b, higher-for-longer that mix? DOL little comments from am I of a up investment potential focus

through of business. the aspects Yes. a seeing to basis, now. cost rates step on we're course, up the GA take channel a channel. I'd Glenn, are of distributing for income seeing We're close Year-over-year the insurance lot Well, the of thanks lot up all success right operating question. in our tick across, the past months back, you've and products. individual over a really, momentum crediting of XX% institutional through where seen given is

step-up I think net you've a income in commensurate as seen also investment well.

net bit of And a little if where was. income cost of you ticked quarter-over-quarter, margin north our insurance look up investment

basis points about basis higher we And return GA. in in net-net, so a came XX asset on on

like is all So right we're of now. aspects across that feeling the team business executing

up. you mentioned the You DOL that rules. glad I'm brought

a seen. this the similar In expect that our draft forward. we our XXXX. Our regs the punchline material in business based perspective on impact is on many ways, going from don't to out regs draft have We to have are what came

that. most to for I out. well our So feel deal for is percent able the channel is well broker-dealer XX-plus that's is wherever to think today the and the bank come prepared prepared channel. that. be it's prepared through We industry regulations of this with GA distribution

an they the make product, is investment important for to support they're sure to for accomplish. we think in that, regulator trying the it's that space. I think that's buy paying everybody get They when good want value I the But note fundamentally, here what consumers to and

very material no work team punchline, momentum to GA and continue we with closely issues, there. So the the continue to

from Next comes Wolfe Chubak question Steven with Research.

fees 'XX, a start level capital in real so to with where continues as the versus environment, about XXX% markets, a suggests normalized wanted asset XXXX average business subdued. markets on activity baseline, could in think So could to higher PE capital growth about generate the the be But more AUM in normalized off your levels. than what we question pre-COVID be

fee closer $X.X So a about bogey. to billion

markets might the upside hoping lens is the on in I frame view here? like? look activity, could assessing right normalized was is that AUM the increase your what potential for And capital you what And

the for question. Thanks Great. lot a

of I'll couple and and things maybe Markets just with a think our then frame on start how Capital we year business, about this go-forward. So the

really look So tough and for XXXX as a period environment at we've much of XXXX, time. of you really operating that been in

been have markets IPO shut. largely

certainly and market. And protected more have been business down shut. of in down, to that up has up. that we're The but how really revenue markets Secondary been leveraged has finance market proud down than close

we're you in $XXX year, our $XXX should suggests about quarter in If about range. of in be revenue good We mid-XXXs that do terms QX. pipeline where million year-to-date, look, million, were while feel averaging last revenue we a our

And in being great to revenue like a done I has job able so feel a market. team protect the down

important around I you question an more raised Now think environment. normalized

XXXX. as markets capital third-party a If generated suggest, I our you to in share take look a we greater at did And we with XXXX, of in $XXX Markets things more we've revenue than business. component today an got of million you Capital our franchise. doing think we're And as firm opportunity

at like over not or off million a a look the feel number. to achievable. think, we plus real a that us, normalized $XXX But have we platform building quarter we more growth So top can We're end. time, minus is out environment, very that that's that

In terms I the of what really but forward-looking of across the breadth what we're share of maybe we're firm firm versus scale. necessarily differentiators more and be the scale real one, part breadth doing could where we competitive in It's the indicators, or as business, across think opposed AUM to the it's doing third-party of think we've to marketplace. ability got take the our our some the

those the growth for for are than what to the think us AUM are more necessarily I indicators the is what firm.

years. XX-plus what to -- cycles, what I'm past thanks the But to been business of it it over months, about has our have what have part or would could right now we that experience really speaks team the for to good past -- feel of I the think, so the question. the been XX our on really past relative in built

baseline Markets last the has years. Thanks business over for few the up gone materially doubt the Capital question, no Yes. Steven. the for There's

to you some could frankly, look monetizations. And could metric I also, think look AUM one could to also is deployment. extent, look We to. you to

at the few often As our Markets so public I'd exits, things. market Capital business look particularly probably in participates those

we're prepared pick As the activity quarter the in across Rob seeing those fourth remarks, said up areas. in

So as I the business would expect flow well. that through Markets Capital to to

the Goldman Sachs. is Our Blostein line next question of from with Alex

Asia. the we some hoping North ahead comments big around coming talk and the like cycle, deployment funds couple especially Infra could relates was I between quarter for it fundraising minutes your to a in and the the quarters and of of and interplay as the Global America the flagship

still North the particular, and dry So lot in Asia, powder. America of a to seems have

help deployment your seeing kind when that those for on how the maybe of outlook come strategies us can what market So to vintages. and you you're with next frame informs view the back

it's Alex, the Craig. Thanks for question.

So a thoughts couple of here.

our understated First, of the at in an dollars as table invested see the fund look when numbers you will, the committed be back have we press if you that are in investment. to anything, release, if on basis

Those that are dollars won't table actually actually show up those until and called dollars invested. in

a well first give for in half we'll some we climate. you look invested we'll value. And be as that that 'XX of on expect those So as those think 'XX that do an actually at those of just on face as broad by timing, supplement next will is in we where here, topic, -- farther front-burner infrastructure year. be specifically updates to committed both And terms in terms of on X, on than over us, status those. table able are looking we activity along of might you of last And I funds, at a and think and in to we're announce the basis, those the which but expect nothing active

continue be is feels fundraising So like to this just active. team very again, to going our

Davitt of comes Autonomous next line Research. the from Our question Patrick with

they Global outflows trends offsetting So highlighted. there. some deck out I fairly you strong at the appreciate put suggested But Atlantic significant the May

also a So XQ, Atlantic? in, on you Global little regular understanding $XX and give other you outflow flows tracking been coming billion but in more specifics versus retail lapses have at how items the have could way

for thanks Yes. Patrick, question. lot a the

would our $XX flows. And in business. is, business, $XX billion about the side, 'XX, our way really, we think the that to part think it as organic we of As I in forward range individual I be regular in in organic of to look billion way, look

of basis, The in call organic that And billion plus it, the the range. institutional that mid-teens. part in again, our more on minus outflows, business, flow probably or $XX

$X so growth And like to billion basis, we on call feel net organic $XX should have, it, GA next a of billion organically, year.

that as is incremental which upside layer example, to block and MetLife block, you an activity, Now of on top all that. the

we and We're close at for as to with Atlantic. of both relationships our started win-win pipeline As it some feels and can good our come where us it in today as very block able on we ownership since clients and really look we be specific partners the there side, out partner space. deals solutions that seeing with our has up Global

and real organically. there, would we grow its And you so I block Global then the offset, continue both noted, regular-way to ability months, coming withdrawals. that's really momentum how on to about think over And XX Atlantic see side, as by the course, of

Patrick, only the for on time. The now, XXXX, have billion focused thing $XX gone to from GA's period because would I Since pro get I assets announced in billion. forma of any was MetLife, Yes. shorter add, deal $XXX wouldn't too

of expect all expectations we've meaningfully trends So of going we forward. terms net very to see growth, and in exceeded consistent our

JMP Securities. the from of McKenna with is Brian question line next Our

firm. announced recently investment sciences a you've with life a So partnership

care So broader at partnership How could growth accelerates Life market? is the strategy in part what talk plays how KKR? opportunity bit, into you the a of about within longer-term Sciences? this this then health And investment the it this little

the for Brian. Thanks Yes. start. I'll question,

firm equity growth I a Catalio, know, $X-plus private we've our more on billion think, big firm. health space. care our so at that investment the care perspective. investment strategy an And we is business make science earlier stage. which a origination a got better then partnership business the And focused as at you also is their into got help We've from the a health can It think make and real really leading life better,

care the our based equity for strategy big nice a originate we private our flow as growth. get And to think we we'll And capital business across that growth is ability as on health strategy, potentially did strategies transaction. return credit both our why their our maybe very well help business on a reason

Yes. newer to we've The That been ago. leaning would on, date. in the really add, us business think Catalio climate, and from is care is One X handful mentioned, health growth creation only a more could recently. There's we has of over is guys Brian, our focused exceeded for other standpoint a life this that space, the of we just our and time. meaningful of strategy part where which just years sciences where I started opportunity thing there areas the be expectations that partnership is effort.

next is Budish question the with Ben Our from Barclays. line of

us think, stakes Atlantic. the I the There Goldman Asset clients. about ownership from ask press that might have possibility last buy Sachs month to wanted some back I earlier, Management KKR was some to the of about Global wondering old or that could of about you was to it? what least how speak you Is and think I works if we if to remind not, forward? at expect arrangement could there And that. going should any truth

able asking agreement so team Thanks to is are article only question. that much you Yes. and there and Craig that lot the glad not Larson out, team inbounds was and shareholder got asked because since know provide. I his public, I'm questions. that And came when of it for a him color his

liquidity, the do to process, that be be obligation have want in is to shareholders an buy the has clear, What To to got seek out they we to at help future, of KKR the to Atlantic. extent do. happy no we'd which, course, obligation very them that in contractual Global minority

open the well. part our way, as on of in any us in obligation course, no option So to but future remains that

of line from Bedell comes question next Deutsche Our Bank. Brian the with

FRE the on focus comment. to just Maybe margin

that improvement? you with talk in? scale-based come fundraising the Craig, timing a remarks, that the started so cycles And And the bit up require around mostly is flagship does little to that? migration in about off Can from to your it therefore, prepared XXs. mid-XXs just you think, low I the the a

about in in happy there. wealth about spend good strategically, of of having sort that in something just and I'm And Was guess, particularly to that mid-XXs? the you're investing if I terms distribution, then, think the grow you initiatives? versus the maybe big that traction delay you're thinking I And one improvements growth think to into that the how is

for thanks I'll the Brian, Yes. question. start.

So I both short think is do the answer. we can

margins. to that over think able I growth invest today, have today, be can been I that than timetable when we've as, sitting our to in and like I we confidence you, firm No mid-XX for we achieve ability can more our margin. to I think least, FRE ever here we expand sustainable tell at achieve doing can into have the time. But

I' think also, I us. say, I cap don't for that's the

As the term across building that opportunity long our there's we're at I margins to you platform, sustainable business updates, we lot look think achieve we'll we're at the to north to step going mid-XX% expand management over a asset more basis, of that give that that course, level. one our on a progress. again, of of on got, We've time. be able conviction a and But

line is of question the from KBW. next Our with Mike Brown

it the teens to But maybe on -- you raising GA margin that the on XXXX somewhat assume assume can imply, ask contribution key to around assumption use And flagship of gives fee a if performance you then comments maybe, made a will what me guess, right that performance in of I -- low to confidence then if rate just growth growth wrong, help that piece visible building the I FRE way and and the control? ramp unpack me kind like a to grow get the So want targets. I -- think I from meaningful about can campaign I but if that your on to you target. your path of I'm next maybe the I you the put drivers XXXX at DE? assume fees. out doubling Clearly, and blocks? to if seems the you'll correct Is that's that

Great. question, Mike. the Thanks for

I multiple a different really factors. So it's think

see doing definitely from unpack it's growth, opportunities and sit balance increase And and I expand FRE on our then we're we $XX further little embedded what you a earnings to sheet of stated, as billion-plus can it's Atlantic Global we today. there. And that our that contribution gains with think to grow bit. our

And that earnings gives power. our us of forward-looking comfort a great in of deal terms

in So things years those ultimately our and confidence said feel that X I numbers. we when our it's did our us we numbers. ago than comfortable that it we X initiated call, in together And this reiterate now guidance, today achieve a I'll think, more combination working last of ability we call, gives to

board. bit quite I because ago, we've tough space, our you X tough saying even conditions, of at that least a initiated feel, in we fundraising think tough about volatile monetization, years sitting than if confident the But what's achieve that now here years that, X targets. overall spite had very more we you ability in that's in happened, marks And ever operating across our our market, since we're telling overall guidance in to think

Yes.

grow. got Let and of really it different question We've the optimistic, me Mike, 'XX. lot feels firm, pick the candidly. you up, ways a Inside I about to appreciate just asking

those flagship capital, As Craig raising fundraises been we've mentioned, but in Rob are and been a have those and of coming. numbers, our not lot

not younger I'm And sure appreciated of We scaling have fully lot how is. a firm just young and the it's strategies.

raised XX last less the at of XX% years look from you if we've than money strategies X old. nearly been But months, the has

the strategies to Fund or XX III be of market roughly and/or the at we'll XX there's months, XX I, with, If XX are equivalent. II those you in next look different

able young, and to So through we've we're scale quite cycle. this been

lot to as traction in find we're more gain for way everything the X newer to closer we part doing. Private top as see of curve, at is a and Wealth these that of start we inflection and our upside, get businesses us. And

ahead have a we about. upside of we talked lot us. of GA, So

as has Asia well. significant growth opportunities

So starting the to probably this is XX-plus started hearing And of lot reason operating XX that we're optimism the in why, to is all to environment, a that businesses period of quite just to the we you're we which despite optimistic. about is these talking X scale. still would take years were get that time, ago, years happen

with line the Cyprys next Morgan of question Michael Our from Stanley. is

any private potentially are rules, you with the see curious attractive out as opportunity less fill Any areas And on Any unfolding. you view just question in attractive banks quarter. bank most the guys that? for credit and versus steps ask And to order the housekeeping Just of need sheet just new how wanted Rob, there for need you just in? coming to particular to capture set KKR? this to deployment that capital then you the off balance at in a gaps realizations the point take on

credit-related Why start don't up questions. realization, deployment and the some Craig on of will the and private I with take

Say, roughly quarter, $XXX million Mike, off monetization of platform. the deployment we're broad-based So it's our deployment balance on our and this sheet. pretty across million $XXX side,

towards On real bit the maybe little assets. heavier a weighting monetization side,

it's Craig. Mike, And

as finding on Just our of terms -- topic, active team opportunities remains in the bank the very it I think relates banks. look, to with

continue. of that You from bank press would on regional a acquisition have and will seen in the our release activity platform, QX a focused portfolio through ABF

at $XX $X the lending. many our you of even a direct in look if billion are it's a providers and And in you trillion think against enormous market private asset-based finance further take moment, $XX opportunity, back million step $XX asset-based real scale you've our traditional in know, of credit you time, secular platform, really when over me, this of view, and million and for got a play we're finance lack ] [ excuse a AUM, capital. retrenching. opportunity, here. And same tailwinds at there are as At But

long-term we we one to highlight positioned think really drive that to would here. So I that real just it's we're an as well growth area think continue

Mike, opportunity got We've big organic if any in here. that I a There's cap. point gaps. build And asked there's to a you terms nothing would of Yes.

comes with question Oppenheimer. from next Kotowski Chris The

of reduce like estate. Yes. near a feel the or fund guess, concerns States the of every world real globally. other the But wonder United trying is doesn't I if I invested in and there the we're spend guess, you end on hand, or real I the both businesses, their the United commercial States estate your your about the just and to about latest to one -- rising in could exposure office in the anywhere it impact on bank rates. cycle are to minute been I X mean, in hand, talking the has And mostly already. flagship approach

is private this environment the where usually So can thrive. kind of equity sponsors

it be view lean time defensive? in? still to to and So estate? the is on Is real cautious what's Or time your this general

sure Yes. then overall, the I'm platform, the and as Why on don't I and relates it start tone of environment. with Scott will the add in to opportunities the team

equity today estate and level between real with we're very to balance of a Just set, real credit. estate AUM good billion $XX

round have equity, in numbers, credit. billion $XX $XX in we billion So

Europe, strategies opportunistic U.S., have We across Asia. the

into In the U.S., now have plus Asia. and That's core we Europe expanded vehicle.

have so vehicles. credit or We dozen half

across Asia. So integrated, strategies, across how it's the debt U.S., multiple up create And structure Europe down fully can the we're opportunity. and a capital in that's against and global situated equity and solutions business the that

XX, Now we're on on looking go-forward, in one point the environment think, is that's opportunities. we XX your current interesting constructive the because over months, very really coming the those

that of there relates I it maturities couple I and not capital a think, office. And to wave needs U.S. this those, is as look, a are think, is coming. of first,

very partners, are of excellent that through actively through, think some is example assets of of pools an very we sectors, excellent an that see structures. take our to capital. this opportunistic capital think talking performing about and in limited ahead is opportunity levered opportunities are with terms as we're our assets this time but in And but I going work very These strong with assets, to

would And real the credit. second I'd mention, estate again, be

are view, dislocations our that, opportunities. the So creating interesting really in

have rates, new widened for credit You have spreads meaningfully tightened. originations, high terms base have

with more covenants coverage, And lender-friendly so rates higher LTVs, structures. have and interest better today's CRE interest lower loans

X-plus in the and would look years years again, So our LTVs low from double better up tranches, and if at today, moved single pricing low back with terms. to ago to taking those ago digits were have risk mid-digits X you to less subordinated view, lower

think as how we're very So we're and think forward-leaning. constructive, a we're be we I situated, in of position to I think,

you let I'll pick from there. up Scott, it

that Look, we And dropping, rates started ago, Chris. cap were somewhere obviously, over in our direction. building 'XX, question, period we move were for of platform there, years we've X in significant seeing estate real it, call the been Thanks a Chris. time. a Sure. probably business in rates XXXX, Where, XX to XX

thematically think the our built business across team thematic how I It's been the about has focused, perhaps thoughtful firm. they very investing been our incredibly most business.

about a where As very were result, they deploying careful capital.

As business. been example. But very real a we result, core we don't estate really large plus just opportunistic have have about fund to real we've much a and equity, That's across point, building U.S. your credit office table, estate, the X exposure.

of So continuing capital. where of kind stand, to in raise we terms we're

more time. is I think the opportunity will opportunity gets even real estate Craig's we point, really But up, credit to that be showing interesting with interesting. before the think

even so things be And and grow capital, get of to Global world the continuing ways we through deploying continue one to we raise around getting quarters. to attractive is next into which the for the business as head we the been And selectively to able all Atlantic, expect this case. we've ready are more several to

So this to significantly, we're time you think under I where this can we pressure. It's And be. grow of really see like about business especially can continue what periods valuations optimistic you're if right.

from Securities. next The question the McKenna Brian line Instructions] [Operator with JMP of comes

is point and quick X dividend rate just drove The for Wace? million out tied level up And quarter, the that Marshall is What line of the then And Rob. how million slated for starting income interest much of run so moving follow-up, the $XXX the this? quarter. good in forward? $XXX ticked plus fourth of monetization items a for Thanks the to quarterly

question. for Great. the Yes. Thanks

of rates interest rate cash of honestly, the some balance sheet. up and where a dividends is in at coming on closure and beneficiaries balances just, Some floating on of our function the our

carried that incentive to more Wace in and balance income be sheet it, As I the it is our fee $XXX-plus quarter. would of Marshall of interest relates would million, from call that say, XX% and XX%

we've time, the question-and-answer to back this I'll turn At for session, the Craig closing of Larson floor our remarks. end reached and

And you, a for your thank busy you Rob, know this very for everybody, period first, for We KKR. interest thank your earnings is help. everybody. in

questions, us any additional with follow have everybody so you Otherwise, up directly. in If we'll please days. much. XX speak Thanks with

conference. This everyone. today's you, concludes Thank

You may participation. for you at lines your Thank disconnect time. this your