AllianceBernstein Holding (AB) 9 Feb 232022 Q4 Earnings call transcript

Thank you for standing by, and welcome to the AllianceBernstein Fourth Quarter 2022 Earnings Review. At this time, all participants are in a listen-only mode. After the remarks, there will be question-and-answer session. And I will give instructions on how to ask questions at that time.

As a reminder, this conference is being recorded, and will be available for replay on our website shortly after the conclusion of this call.

to call, conference for Head like host to AB, now this for of would turn over the the Mr. I Investor Relations Griffin. Mark go Please ahead.

you, in being webcast to accompanied by website, and earnings Thank www.alliancebernstein.com. presentation This Relations and morning, that’s section slide quarter our posted review. is fourth Investor XXXX welcome call conference a Good operator. the our everyone of

COO quarter and to Bill discuss Accounting and and CEO; the are the Seth remarks. for us today for and Group Bernstein, will after us Officer, Head With Kate Siemers, Erzan, our results Burke, CFO; Onur Client Chief of prepared President our company’s join questions Controller Global and Wealth. Private

to rules certain regarding disclosure. Some regulations SEC today the of we subject will and information present and is forward-looking

the to Safe language like presentation. of beginning X I'd point on our Harbor slide So out

our only in which XX. You Harbor public may management we can of community forum. the in file a investment MD&A XX-K, Under on will Safe also Friday, February material nature address of FD, our from find language questions Regulation the

this all please during So questions such ask call.

I turn Now, Seth. over will to it

Good a with and income year XXXX fourth rally quarter diversified thank was their worst double-digits posting Despite markets record. joining markets you market today. on morning us investors, both debt equity a fixed and for down challenging for and returns annual

Nevertheless, EPU are XX%. with average teams down AUM accomplish. down down very what year and with full Our financial contracted adjusted markets to along results X%, revenues proud able X%, our I'm of

industry the to platform assets for consecutive fourth year, trends. our buck active diversified globally grew Our continuing organically

embarking and we to mix Research. a second multiple promising opportunity private Bernstein improved transactions executed of growing supported holdings the straight growth CarVal Our organic year due for And and rate equitable to by the effective alternatives in on strategic for on acquisition. a due growth fee

or XX% quarter. the slight net $XX.X specifics, We ago. declined from into billion saw starting with in sales of a slide firm-wide firm-wide billion, the quarter by Fourth on gross year $X get overview active Let's X. outflows

gross the growth. record prior $XXX.X For organic flows were $XXX of year active active full posted of consecutive net down year, of billion, fourth the sales million, year. we year our full And XX% from

Year-end assets Fourth year-over-year. billion X%. $XXX was $XXX quarter declined XX% of AUM of by prior full $XXX AUM billion versus management under XX% year billion, average the year, while down average declined of

wealth. Slide by institutional billion, X $X.X flow in shows by quarterly inflows with in net channel. our net fourth outflows offset Firm-wide trends net and private outflows quarter retail were

billion outflows sales were $X.X billion, inflows net Retail billion. generating $X.X net $X.X mandate, Institutional gross sales were billion. a of billion with target of $XX.X $XX.X supported custom by date

of net In supported pre-liquidity Private to on $X.X Wealth, cohort, million as slight planning. in continue net worth $XXX were engagement billion, focus with gross the sales ultra-high outflows a by grow we

of income, annual for managers, $X.X outflows municipals. six sales sales In led last were taxable million below and billion in were Slide gross levels. excluding $XXX shows inflows $XX equities organic offset net Net billion year's flow of active net of redemptions. XX% by Retail active trends. growth AXA a by driven of record to challenging ex-AXA billion fixed year firm-wide $XXX

organic in organic And had $XX.X fundings billion, billion the to of two driven our $XX the We channel gross in net billion had $X.X date level straight related since target by highest mandates. consecutive growth $XX custom year last sales seven. the billion, fourth increased sales billion XXXX, ex-AXA. in of institutional of Wealth of this Institutional growth $X.X to inflows Private of fifth year the second with net inflows with of

inflation. in fixed slide rally, in fixed Interest banks with quarter income markets equity on shown performance markets battled Investment Starting tandem Despite fell as fourth is income. with seven. a central XXXX, relative soared mounted. Longer-term to credit bonds. sharply XX.X% were recession global year. rates leading challenged markets yields All government fears during sectors grew the turns in fall to developed treasury and

corporate Securitized fixed emerging lagged other bonds XX% In periods income trailed. and assets XX% period, hard the credit income while outperformed XX% markets of of outperforming performance respectively. and this and outperformed the currency environment, our sovereign with sectors, assets our over while fixed one-year five-year assets over three

the quarter, fixed global in As our of income comparisons our based retail strategies peer in we positioning our said reflected The are year making focus. US our more as outperformed most just last one-year US credit, and broader last underperformance challenged.

overall investors, on back mid-grade supported we've partners, by yield Municipal fixed to comfort global and by curve that hiking lower-weighted impacted in the nearing performance municipals overweight a retail begin Encouragingly, cycle. financial our better now to to exposure by positioning. and appears our channel, rotate was back to of with Fed of greater be an end the and Asian valuations seen income into the rate the interest institution duration,

quarter US fourth equities. the X.X%, lessening to XX% full with up the advanced during XXX markets equity the Turning loss. year's S&P

stocks. quarter, year. on quarter loss X.X% Growth and the the The for negative rates bringing as value underperformed For Index year-to-date year, the for quarter and to versus return XX.X%, returned XX.X% Value XXXX longer-duration Russell Russell X.X% the higher XXXX of the growth weighed Index's for the

XX% for outperformed, period. equity and The XX% one for majority five-year three-year assets of periods of the with outperforming the AUM and our

the sequentially, and to technology. as Our improved overweight XXXX an our mega-cap aided US benchmark, one-year underweights large health care by cap growth performance Russell growth to sector composite beat

on against can market volatility. Quality identifying even we're characteristics, Stable or because beta environment, with help recurring inflationary firms. profitable business power large the discipline downside, buffer have demonstrate typically this all defensive In broader with maintaining growth in lower environments. market companies profitability they high-quality companies consistent streams, in to and models pricing companies on spikes sustainable which traditional have revenue sensitivity the strong often cushioned and

down up low Annual of $XX billion of last to $XX beginning billion $XX fourth but level. down were retail like from last historical annual a with were The year's I'd client from XX%. quarter redemption rate billion billion, Now, $XX our Fourth sales X. year's record sequentially. record slide reached sales review channels on quarter,

were Fourth outflows for net a latter $X.X active billion, billion, grew income, driven straight sixth seen challenging fixed organically quarter outflows to primarily equities full the industry-wide. contributing environment, year of dynamic Despite by $XX taxable the net the year.

Our organically SMA our The municipals grew for and straight strategies. aware XXth latter by our led year. the tax SMA custom

clearly year. fifth are flow Several perspective, consecutive industry grew Japan its The share year the bottom shown a on trend shows with US fourth we both organically in of market are graph that right. inflows wide the for net outflows. AB's and rankings regional left From grew businesses retail bucking bottom straight for the taking

AB large with For the words US ranked growth. the year, in led in by equity XX flows. on flow flows few A US cap of rankings XXX positive

Income, January accelerating AUM, retail, American Our inflows two In for into dollar inflows. is in we bond released fund quarters. which US ranked will today XXXX flexible market be saw the last flows first the net that from after benefited a category closes in

We continued strength in muni saw also SMAs.

in billion the three in straight mandate. mandates. $XX even billion of Turning Institutional in $XX our since XXXX to low net years. fourth the disclosed were inflows of by year AXA on gross each fundings was positive the $X.X target $XX.X two net driven target quarter XXXX custom Fourth last fee custom redemptions previously sales institutional, from billion, highest year date sales Full date of included slide from billion X. of

inflows were billion AXA. $X.X in excluding year billion $X.X Net the or

multi-asset. to Our effective inflows of quarter rate quarter, alternatives fourth and the continued fee into the by driven improve net in consecutive XXth

of to $XX.X declined pipeline $X.X Credit billion end $XX billion the Value institutional Our in billion including with at CLO-X Fund Clean carve-out V, AB fundings funded quarter, and including quarter Energy.

notably about annualized Eurocred. And than remains market lending the alternatives, comprise more the additions rate. the comprise the private three average, the of alternatives pipeline driven pipeline fee half and XX% which the of in more than Private fee times to by channel middle quarter, rate

In been returns commitment January, for received half from additional markets based billion their and well-diversified far asset XXXX, client class $XX our improve type. institutional client deployed we geography growing of year-end. to cap private in the duration style the higher capital well-over fee at Cred have while we strategies which and US increase $X.X has in our Equitable. by billion commitment inquiries, for billion broad an business, of $XX permanent longer are Part seen an in Thus which

quarter a year-over-year. historically elevated to on Fourth slide year-over-year Moving by slightly sequentially. gross XX. year, declined productivity just of sales increased X% with Wealth gross year $XX.X billion, X% sales Private remaining strong prior down and XX% Management Full declined versus

fifth and in year rates net slight year the Despite net last second from XX%, inflows organic seven. basis full a in quarter, Full points of redemption to fourth saw billion last year down the the outflows in year. growth, row the $X.X XXX of the improved

over focus of toward clients, outpaced, particular mix $XX more pre-liquidity client ultra-high than fastest-growing net the shift generation a well an fourth worth and which Our XX%. our contraction remain This in cohort. M&A our from continues industry-wide to efforts, quarter of cohort million planning volume which is AUM event our

$X.X XX%, Bernstein which new launch full alternative up the of third-party of included year, commitments were For private to billion the partnership. Impact products a Alternatives,

including, set AB robust value XXXX, planned energy, product and of transportation. Looking have launches CarVal we to clean new a credit

direct XX% while X% Our indexing by and AUM year-over-year, grew strategy organically. proprietary by ESG grew XX% sequentially

trading global up XX. by characterized Fourth million, revenues the XX% decreased on was year Research as business half, I'll and by constrained first Slide were stronger uncertainty. year The half, with by $XXX second by decreased institutional XX% a amidst a sequentially. weaker revenues Full X% our finish year-over-year overview sell were side quarter of Bernstein year-over-year. volumes followed

research single-digit to high grow driven at We continue Autonomous. checks, by growth

Services, and in cash strategic well In our has for markets we business. This joint by opportunities capabilities. contributing with Research our received global adding growth equity enhance new talented research the partner's venture to Societe prime a capital the been business brokerage through announcement teams, Generale's recognize potential the November, derivatives into who decision announced equities Bernstein

close financial and We before details closer regulatory to to consultation the subject we countries disclosing to the several anticipate in continue to approval that transaction end of and expect XXXX, time.

against on now I'll progress initiatives XX. our review growth Slide

in performance investment XXXX. mixed was Our

disappointing majority assets equity While the income, outperformed. our of fixed in

For or outperforming, period. periods, and of both the more three- XX% solid was classes with five-year the over performance five-year asset

and Robust with private for solutions the despite also contributing for growth consecutive I'm driving munis, challenging in to proud our custom in last year, the active organic teams, retail. conditions. active fourth alts, of way financial led equities target-based market growth year,

the straight influenced of by effective the and rate CarVal. organic growth mix both fee for the Our year improved strategic acquisition of second

our below private support With contracting their of closed three-year our the we target $XX up of prices enhanced toll, of the of a long-term partner Equitable, diversification Financially launched business, took which and billion rolling significantly asset business on to posted XX%. CarVal margin as our XX% XX%, active incremental ETF XX% markets range our strategic transaction, year-over-year. we

revenues margin XXXX year. we year-over-year, Full pressures basis XX.X%, year earnings distributions down XXX adjusted margins AUM year-over-year We of and volatile. the facing operating lower on XX%, market entered our declined remain and unitholder and will points with prior financial conditions versus with expect XX% adjusted

to global a headcount took reduce that base. Accordingly, measures recently affected of employee portion we our small

I me for against third-party technology active team's China confidence growing an look which managing costs, of business These venture. pending, forward, to and With offerings, for XXXX. our positioned initiatives while compensation remain joint give our business approval capabilities accomplishments up include XXXX, Research's on us. in and our clients, capitalize initiatives strategic remains opportunities our asset opportunity ahead Bernstein insurance AB we standing grow and in in regulatory ETF As investing business management on our in growth of muni and diligence to other in key CarVal executing investing continued

to Kate? to financials. over Now it I'll Kate turn review

Seth. Thanks,

XX% margin the with income the income X,XXX XX% XX. million quarter start of decreased decreased $X billion $XXX GAAP revenues net year operating on GAAP of period. by XX% Let's statement decreased basis Fourth points. prior of Slide from Operating and

EPU by $X.XX of decreased year-over-year. GAAP the XX% in quarter

$X.XX year-over-year. revenues year, declined XX.X% income Full decreased full XX% year basis the by and net $XXX For $X.X of billion by operating margin of of operating XXX XX% EPU of million GAAP GAAP decreased decreased X%, points.

to my a on remove of distribution results, of provide effect and the not certain our which to for results, focus remarks that unitholders in adjusted we I'll not considered core our items adjusted results. our as from on business. our operating substitute addition GAAP are We our which part here base

in expect and a we adjusted results latter our to reporting of GAAP to on our appendix, XX. standard GAAP in of release Our release and are presentation the reconciliation Friday, XX-K, press February which

with on walk are P&L the shown revenues revenues. XX. Slide on, period. XX Fourth highlights of prior financial XX, adjusted shown Our million On I'll year Slide Slide on quarter which $XXX beginning XX% as touch through the we versus decreased net

by base year, In period declines X%. full net year by down XX% full period cases Fourth $X.X fees were lower partially down both billion for were driven X% year-over-year, of mix. were higher rate quarter base AUM, For basis average year quarter by decreased AB rate of driven higher revenues the rate fee versus of full by and by was XX.X XX.X fee prior year the both the asset fourth X%. fee market year-over-year. offset rates. The X% fee rose up and points basis fees carve-out points The

financial of real fees Arya services the Select from fees services. AB lower driven financial opportunities driven prior performance by and equity. million of prior private quarter million lower the fees of Arya were $XX year US million and estate from opportunities, $XXX year Fourth million partners Long/Short, $XXX fees by partners quarter, credit by declined performance of Full Equity robust primarily services AB year, $XX down

we XX% to from difficult to activity roughly driven of conditions. performance $XXX Bernstein market year year due to regions. given trading across Research Services in levels. declined million, XXXX revenues by with full for activity in million Asia by lower predict be fees market local Although XXXX decreased conditions, period reflecting year quarter prior Fourth $XXX of trading all customer X% line and revenues Europe the expect Full lower

the billion while All-in operating year. to flat expenses $X.X with fourth million year on operating X% by decreased of quarter Moving $XXX prior expenses. were of adjusted total our expenses year-over-year, full

revenues total with and XX.X% AUM-driven XX.X% of fees benefits year compensation the by net expenses the lower period, quarter declined period. XX% by reflecting revenues in offset higher and prior from lower as Fourth compensation performance year prior a of compared ratio adjusted

compensation fourth XX.X% in disciplined our the Our quarter lower along with a ratio expectations rally. came compensation fourth quarter reflecting than of process market

base a year benefits reflecting the year and by ratio full increase X% was compensation a compensation basis XXXX year, decreased above driven compensation. full offset prior decline X% points the incentive market. in revenues For which in by the XX% to lower compensation, XXX due XX.X% The

corresponding values lower driving income equity XXXX revenue Entering and fixed headwinds asset in mix. year-over-year shift our are and a

saving across we this help importantly our which invest these efforts mentioned Seth employee offset businesses, X% actions to have approximately actions Combined priorities. in environment our these ongoing mix As us our proactive global key other in to of will some will to taken global position headcount impacting base. and impact continue with of dynamics

revenues As revenue from true to you year know, we our crystallize. accrued compensation XX%. compensation throughout XX% the Historically, year and has ranged up at ratio to year-end as full

conditions, will in end range towards of market be Given this the we higher believe we XXXX.

XX% servicing compensation pandemic the of and year to client-related to by by and the offset year for and execution as transfer the accrue XX% prior fees. due quarter and sales market in from in plan if depressed levels costs up prior were the decreased full first at trade T&E change. throughout XXXX expenses the meetings and period We higher XX.X% year rebounded lower period may Promotion and adjust from conditions year the ratio

expenses. services In professional continued low foreign in up period the XXXX, we partially is spend higher promotion expect to expenses fees technology-related the elsewhere. offset rebound single by decreased X% the offset G&A and T&E and favorable year reflecting by digits in spend exchange fourth lower quarter prior versus be as

professional inflation data G&A rose earning AB spend in year, addition technology full projects return the the and For CarVal, services services. X% of higher efficiency particularly and reflecting growth and and

In managing below backdrop be low strong levels the of growth focused G&A XXXX, single-digits. expense challenging on are up inflation are we markets, discipline. Given we to

and income by XXXX decreased the year of prior full income prior million period. year the decreased versus versus $XXX operating $XXX XX% by quarter operating million Fourth period XX% year of

of Fourth quarter operating XXX year-on-year. margin XX.X% down was points basis

record XXXX of XX.X%, year from XXX operating full margin in decreased Our points basis XXXX. levels

year margin For long-term a XX%, XX% we incremental XX% full delivered basis, our the range. three-year on rolling of to below targeted

quarter fourth business not which our of of appendix core the in outlined our operations. exclude As certain items presentation, part earnings are

expenses. quarter, were earnings $XX In to operating million unit acquisition-related due $X.XX earnings per GAAP primarily adjusted the fourth or operating above

or operating to income year, the above also was expenses. $XX adjusted per For unit due full acquisition-related GAAP million $X.XX

a was better XXXX slightly credit. year than tax effective tax one-time full The reflecting rate X.X%, expected,

an for rate. in line X%, with more expect run our tax of effective We to XXXX historical X.X% approximately rate

As savings providing this updates indicated the earlier associated on are annual at year, our we Nashville relocation with year-end.

for a For cost the of increase savings a income net $XX to greater operating full than year expense million XXXX, resulting million, contribution $XX in unit. were transaction $XX of of $X.XX per the million

$XX Of $XX savings, is million, of approximately costs. million compensation-related the $XX offset occupancy increased by million

the to is range in once year remain to Nashville growing $XX the million accretive $XX relocation XXXX expect of over. per period to beginning the transition We million

In January, for are we sum, despite volatile year. XXXX the market challenging to rally be prepared and in another

the We maximizing to opportunity on ETFs, key make and completing set insurance. joint such CarVal SocGen are the focused and China, with very AB areas continue with venture and as investments in we'll

strategic Taking history back, and a balanced disciplined of and management priorities, of opportunities, has step trade-offs. balancing AB a

have Looking environment a firm. in shoots We forward, XXXX our number of in of made their of as positioning green progress confidence take us to advantage meaningful well tremendous our strategic develops. across initiatives, we the positioning

clients. a sense priorities our and to drive and exhibit as well-aligned we Our outcome ownership, engagement, are employees seek continue of best the with overall for discipline our to strong

Now, take happy Operator? we'll be questions. to your

Sachs. line [Operator Instructions] ahead. comes Our Blostein go with of question Goldman first Alex from Please the

some bit where far. partially the seeing the of it to on morning Can so strength? channel. started retail coming in little with fixed Good as from a question like in usual everybody. unpack Very flows the Thanks. on income. it's get retail you we'll get quarter comments first you're encouraging that sounds the stronger Seth you a Great. for maybe Again your regions

your retail curious get out on guys to active that of the for it income sort pretty might are rest retail of versus flows doesn't despite year, given impact wonder look performance institutional way, the the between challenging they as back are as extent And the seem to but demand for fact I numbers just you the added business? that differences thoughts really healthy the a that in fixed matter for to what institutional you

much. thank you very Alex,

me bit color a Let point. of -- give some that on you

taxable we're here We from principally Asia, positive SMA fixed U.S. in in income, but been in in have the seeing interest January Muni

better a on be to seems that so track. And

Fed that what to for That of clear interesting which point us. think that the a end, obviously course presumes than -- more is change beginning in a do think entry is I closer is than done and but the several the is they've years yields the last to at people current it's

The they evolve. in in to yet, clients With of other understand how performance, number flows robust competitors. had investment will they knows aren't particularly oriented Asia the prior been more who our a we're cycle as as the but regard than globally

didn't we and say recover. to in trials through underperform And our ability we a as have the and with but to have, cycle to confident are us. not understand That's tribulations, they go live we

that you number would our do high institutional have quite in strategies, competitive of further dig markets you yield. I to a emerging U.S. we into say, whether if performance or it's

you we there. seen let color. have over Onur, to give hand so it But some And me to some more interest

things fourth of in from Seth quarter summarized in the the Yes, additions add well. fixed The would Alex. institutional the side Hi almost if half you the income. I pipeline on came at look it are, two

So that strength. we saw

us. market are trend, markets. with make on seen month as doesn't investment one then, have priority a as are international but development January, pre-pipeline in the nice which a areas well critical the in we seeing emerging grades wins high-yield we debt of insurance And good And couple a for again

to beyond custom cyclical Muni custom U.S. know And solution top the color add our on XX set. the is other retail as our large fourth solutions only launched in of And side, I stuff the quarter, several the very platform with intermediaries. priority. that's And would is expansion the got you the onboarded a we Muni

relatively on I expansion. of And So market market gain confident. basis us we're share a market feel I but to to get going that Hard volumes, some predict share. benefit expect overall to

Perfect. that digit well, maintained non-comp Kate. for upper-single range pretty of in for, kind Thanks in there. is well Great second the question of color. digit for promotional hear My sort as the low-single expenses G&A to and so

environment cautious good that year, higher start being robust I like? I look you about despite but you markets think a and guess, would would the in we expenses as of What these constructive the are be? around it remain recovery where some appreciate of market drift as more guys obviously of think where about kind areas if could baking

line kind on And these, the pretty kind Or a sight if I'm growth, a little for on GAAP are the guidance good number? low-single you digit you're of talking sticking you're adjusted of stronger? just talking clarification see bit a ranges of maybe even G&A within number markets not -- assuming, G&A,

for thanks Yes, question. the

that to efforts. you anticipate Where robust you are than You're some in I think, sales GAAP is our be and higher in low expenses, is higher market up digits anticipate in climbing be. of single a pretty to are was markets correct a should in doing more adjusted used continue be that some of be areas. forecast, for we feel the and we tend where itself we but sort on perspective, other some year, side good our the of I terms to see to don't I that in offset G&A think, G&A. support Otherwise Look, that would even we we conservative number this if we increase from That see it to they environment. area in higher going trends have I stronger looking increase market we what where to the be, at T&E see looking off the would we that -- would may could

everyone. Thanks Great. much so

from Please ahead. question Suisse. Katz of with comes next Bill Credit the Your line go

picking just Thank much. Maybe very moment. Okay. on you for the up a expense discussion

reduced moves the headcount. So the appreciate

as that incremental in it rate sort to annual $XX -- run of you treat sort $XX a of of million me. of an you million excuse $XX the Sort XXXX an headcount you savings headquarters, say, hear Is or incremental million still sort XXXX? consolidate bringing of get to million pro forma adjustments still there you're $XX on is into forward you're the the mean beyond timeline that making to

No.

not about the there New million counting you're XXXX, $XX of impacting where final really of talking real we of our XXXX move $XX -- is -- exit realization the forecast. is estate so For we to won't And that double York have we Nashville The is the Nashville when our million holdings. completion real estate expense.

we about were year accretive Nashville The this by $X.XX.

We expect that forward. going continued accretion

those took annually, as we actions took will of provide -- that program did was that's -- earlier and part headcount this unabated. that We place the month. so updates that the continues this Separately place we year reduction

mean we're we're continue free to find here we some but that take of where positioned making in opportunities opportunities also to competitively so, was into I that do strategically to up that examining environment in entering invest and to result saw really us attractive. a not only the XXXX sure that areas costs out we

And hope on that results, to continues the is so to we're independent that be the of able based investment year what Nashville. market but doing our related strategic we increase will headcount is reduction that as

may for you. Thank one you., Okay. Seth And

the at three us you on top as and things you you maybe are the business sort markets the little terms what your at So a a of of see sense alternatives large areas in best Maybe give opportunity truly lot of and step or have in XXXX? of bit two good back going look a flows. private

start still then and doing with are going me Well, up hand fundraise number a new about are again, Look, seeing this vintage some we're Onur. CarVal that good over what private receptivity CarVal. strategies and it Bill toward. very excited have pretty we're I'm let which newer of to they the there headwinds strategies while year, market, and in we're to launching

continue business Onur, opportunities funds are in terms And some why business. market see newly less don't But seeing structure raised for lending in color? middle our US in a give we Additionally, we CRED additional to competitive better you marketplace. our

going the very Yes. No, The one, II thanks I which encouraged Clean year. are would momentum highlight the we're Seth. things by are, CarVal, Fund Energy this close with at we to

bring vintage than is broader the that and assets foray into much market nice more will our as second well. first The retail the vintage

area So highlight. that's additional I one would

all of As given we Seth the have are on the healthy able to I environment an despite the the sitting challenging we quite in to successful pretty been mentioned at we on level US be attractive real conditions, that's half advantaged powder with estate mean debt, I position powder. because think second dry deployments market market of year the dry the terms. have deploy

space. So we like that

for And the demand in realizations for attractive strategies in income of has driven generation our clients terms the strong The private been credit wealth in despite very all channel. remained very in XXXX, our income the challenges the marketplace.

demand evergreen that proprietary private from channel. continue have wealth own to should So our

things few I a those highlight. would So are

just you of specify answering Alex's you line question, when dropped. did you. And the in got apologize first flows January? I amount my I apologize. were Thank Seth, dollar

tonight. didn't. we we're But releasing No,

you. Thank Okay.

with comes from the ahead. Your go next America. Siegenthaler question Bank Craig line Please of of

morning, doing Good Hope you’re Seth. well. Thanks.

Thanks, Craig.

winner? you wanted potential the the year, that rebalancing to be if perspective large this continues you on So, you we if have really in income you big there think And I income passive and fixed first, fixed is and wanted when year. Do to dominate fixed is secondly, the going another to if for update see get last saw rebalancing income? any landscape the I think

given forecast a all is uncertainties that in embedded year it. just the to particularly this difficult Look, think I

of So take it with boulder salt. a

think I there of lot a income. is that for pent up demand

jobs we appetite. really matter that Craig you'll you the that extent inflation And see But so, could expectations continue throw so, And see know to that and again, think data off I to shockingly that. it. see hesitant I we that to see it have we offshore. But there really and it taxable enormous We -- confidence in strong I'm in see really demand think exempt. for tax in strong it is

So a demand there's for I it. think big

Fixed regard execution. passive, that have on which think isn't income we gain have profile, order we look, of funds. is liquid continue beat we've earn our carry We long it, in opportunity. we've to been value net share markets. lowering assume generally think else, will credit sophisticated question have cost I in think which clients everyone our of we automating, been why that like With to we our our is have to which fees understand to, our why the be is from investment passive in portfolio. excluded proposition a to in where a clients to We place But

comfortable And performed structure we're try so I we with long avoid we think think, idiosyncratic very trend our over And don't But overall of changes. to and do we periods underperform I trend way that the in But well. in that slow. portfolios. those of very don't But changed. markets. We pace I exposures ultimately, credit. secular has The may the think time

obviously, And one some it the of is other comment trend. is ETF

a bit a So to little is there story. the overlay vehicle of

be With the able fixed ETFs. encouraged active were we we time ETFs, the have. million we only adoption ETF income passive. can and we actually we early launch few to But by income in have encouraged active two fixed only a of very very short raise that space believe we in the and are of amount the them are believe $XXX will our we some of momentum participate not we Obviously, in

covered So well hence, given trend. structural we believe are we the

but has and one that? business positioned positioned sleeve. think go business organic fixed it are hasn't think just is business income there I follow-up. your years. bond your my do last an active passive And as five AB We seen have for to of good year reallocations the is lot you The great. these How then numbers a aren't that? organic numbers good a that Great. But how do the does It's large know for But equity over better. do growth actually also your growth you bond while. year taxable seen few really for is active

a competitors. that presence, to much domestic of been understrength Look is key I AB underweight, always think where we've number US a retail stronger relative building our

quite been odd in we And limited selling demand so have period. XX very we've And always flows. on fact Asian month seen over dependent

historically. positioned were than better I So think we we're

that – with we and would space, have we and think US, outside I tax that moving a US not in differentiated is high sensitive, may the aggressively I that where into the where I had that fact partners We've play the to respect have which really in more been be conviction trends the helps. has and a US, SMA distribution the to impact where a while issue space our do we buck capitalize to upon the underperformance before, that that big are our product periods absolutely have exempt bigger rating we within for think of us suspect

I disruption capability our competitive be high in there think yield a and strength that is US will marketplace.

you So are elements I but do think there pretty other us opportunity for as mature know. market it's a of

distribution had early say optimistic but given stronger to footprint we've retail I'd I'm days, building the we success have the So we're and that. prove

Seth. you, Thank

Your next Please line of Fannon question from ahead. comes go Jefferies. the Dan with

back Good and if it But pre Thanks. just is question you versus XXXX also broadly was a look obviously, XXXX. XXXX My retail – sales record levels. on morning. below gross down

think terms – if if more last thinking going just normalization to think if of trying periods about in in were forward? it about of other or then you're motion kind So just sales, how this year outsized seemed kind of momentum low abnormally how assets to in the

question. Thanks again. Onur for the

XXXX You're probably absolutely year. outlier right. was an

From taxable as which longstanding has of on that we Part of well in it Part Asia growth experience of to should is flagship and I is more it believe fixed Seth continue and products. -- both product retail, sales perspective, space, focus Hong about. an back. been side US are it definitely on Kong we look is seeing portfolio investments the definitely Asia particularly region comeback are think as our the a we our expansion for of the mentioned in will at we given bullish opening by We sales region. a income American rates. us income, as that coming is on area in

fixed the to Latin we have been big with pretty the Ukraine to it comes else. we products EMEA everything a material us, maturity energy obviously successful had there. the And with the a crisis XXXX, some huge and given Russia in has and It usage of some as hit appetite, contraction fixed been retail lately. proximity income America, well. and we income encouraged renewed buyer platform for fixed when using historically a are had

from see So a upside. low an base I

will denominated and is the be Japanese make some the slowdown see in which will Japan the driven we definitely I US will that one more movements think by reason Yen attractive. less assets

we're So we net have going think on of flows tax expect redemption regions and healthy I partially was have hopefully the to for unique and terms probably overall, I XXXX. loss was which a always level triggered same of level the focus more quite also remember, by of And and longs harvesting not we shorts sales. that in

Great. environmental place occur opportunity of kind year we and talk down That's maybe But terms a just the of thinking that Advisor productivity very kind think on question was backdrop. beyond? helpful. quick in you've what year-over-year you're of in of lot and XXXX to Private assume years. Can more the in in increase in couple And productivity put about last over the was I about then a last initiatives about wealth how as you did that of Wealth.

the Thanks XXXX high XXXX. was for peak productivity a question. decline only a from again small very No. in

The very that. at second out we of years of year as on strong five look our terms revenue basis in was the you an growth. kind will stand organic If also production. XXXX productivity average last achieved annual channel a delivered consecutive the That

segments in are our look high the growth more So net worth versus is terms you ultra with worth. of pivot good And we Xx. Overall, momentum. other we the at high trying net if about ultra to feel into initiatives, organic rate

line there a line are good our trend So we in strategy. with seeing

our that proprietary third where as and is of in the be track our products. launched party an And competition plus ahead history Wealth Private given in have alternatives alternatives channel, adopter as you of we know the been proprietary the our typically early our penetration of and record next of model that both products vintages to our solutions five in private pipeline six well as the continues our channel, with credits or

I So ones. new work given tuning the financial the financial we all area slowed as think economic not are hiring, to obviously, advisor on The advisors it's down we all, older Obviously, outlook. is the as in which consciously will healthy. productive back

might accelerate see productivity advisors at might it's in, just we and will because have But a you that, the the we we February come coming discuss coming a the once in that production. new So quarters. lower high at some class change quality problem

month, in we have But January. did flows, net in Private positive one Wealth flows

Correct.

Please ahead. come question John next will with line of go Evercore. the Dunn Your from

morning. Good

$XX order of talked on the being past terms phase And next next thoughts equitable the and timing? magnitude could kind round maybe bigger relationship? of billion guys any the halfway about mark, acceleration that from we in You well of an maybe the early of of see

Yeah.

really beyond that third-party, our continue Equitable continues and us. will Let they of they And us particular. are build for critical be how attack strategic planning be are though be how continue me expanding start endeavor. will third-party focused supportive to to in insurance Equitable our we our on we the on industry that. Alternatives critical, reach important in to to capability we And Private quite in they insurance generally

over change to their in private Our related size the of time. general Equitable alts ability in to account GA expand is, in further directly

way fair need portfolio. incremental extent to grows add to it us, expand. know where if will of growth. And more, will I contracts anything yield don't continuing said, a commitment continue grows, you at to But Conversely describe that, we probably look have That account and the if so it less there's terms their general being so as be to Onur, that. invest as benefit on they to they is there to opportunistic that we, with guess, in opportunities to that. from capacity it I be do

is will for is be other I dollars and And billion still already them ideas digest revenue several that. bring that's will we that underway. incremental mean, I No. new think to the way Obviously, the that need open deployed. thing to another XX% there the only other let brainstorming

of Makes capital kind remind sense. you of consolidating just then us the impact of can Bernstein? And

clarify? to can I'm mean just you – Bernstein the sorry, joint You venture? Research

Yes.

Kate ultimate what here. It's like. early would in integration work stages around the We're the still Hi. of look

the to transaction. we'll guidance closer on of so And the closing give as further we that, get

Got it. so Thanks much.

further over to no time. are Griffin, you. I questions There the at call this back Mr. turn

Okay, everyone Thank terrific. for our Regina. conference participating you, call Thanks today. in

free feel and Relations, additional back great always, to any As out day. with Investor questions have a to reach