Thank you for standing by. This is the conference operator. Welcome to the Great-West Lifeco first quarter 2022 results conference call. I would now like to turn the conference over to Mr. Paul Mahon, President and CEO of Great-West Lifeco. Please go ahead. Thanks, Ariel. Good afternoon, and welcome to Great-West Lifeco's first quarter 2022 conference call. Joining me on today's call is Garry MacNicholas, Executive Vice President and Chief Financial Officer, and together, we will deliver today's formal presentation. Also joining us on the call and available to answer your questions are David Harney, President and COO, Europe; Arshil Jamal, President, Group Head, Strategy, Investment, and Corporate Development; Jeff Macoun, President and COO, Canada; Ed Murphy, President and CEO of Empower; and Bob Reynolds, President and CEO of Putnam. Before I start, I'll draw your attention to our cautionary notes regarding forward-looking information and non-GAAP financial measures and ratios on slide two. These apply to today's discussion as well as the presentation materials. Please turn to slide four. Great-West Lifeco continued its positive momentum in the first quarter, delivering solid results against a challenging macroeconomic backdrop, which saw central banks raising rates, inflation reaching multi-year highs, and heightened volatility in global markets. These conditions have in part been driven by the senseless invasion of Ukraine, which is causing such tragic human dislocation and loss. Our hearts go out to those impacted, including so many families that have been separated. Our companies and staff have responded with more than CAD 500,000 in financial support and are actively engaged in refugee resettlement and support efforts. Despite the macro challenges, we have delivered very solid first quarter results. Base earnings and base EPS were up 9% year-over-year, reflecting the strength, resiliency, and diversification in our business. Performance across segments was good, though earnings were impacted by equity market volatility, our business benefited from strong yield enhancement gains as we continued to source attractive investment opportunities. We've also advanced our value creation priorities across Lifeco. At Empower, the integrations of MassMutual and Personal Capital are progressing well and on track. We've successfully completed five of eight waves of client migration from MassMutual. While fees are somewhat down from Q4 2021 due to market volatility and the timing of expected client attrition, we're pleased with our momentum, including cost synergies and client retention, both tracking in line with our original expectations. Garry will cover this more in more detail during his remarks. With the closing of the Prudential transaction on April 1st, Empower's participant base increases to over 17 million Americans. While we're focused on serving the DC retirement plan needs of these customers, we see significant opportunity to serve their broader wealth management needs. In a few minutes, I'll share how we're accelerating the build-out of Empower's retail wealth management strategy, including leveraging Personal Capital's digital advice capabilities. Wealth is a core strategic focus for our group, not only at Empower, but in Canada and Europe as well. Our progress is evidenced by strong sales and positive net flows across our wealth businesses, notwithstanding the market volatility experienced in the quarter. Please turn to slide five. This slide shows our medium-term financial objectives and performance over various time periods. We're pleased with Lifeco's continued strong performance as we execute on our value creation strategies. As previously noted, Lifeco's base earnings and base EPS were up 9% year-over-year, and we continue to track positively against other objectives. Please turn to slide six. Canada Life continued with strong momentum in group sales. Excluding a couple of large cases last year, growth was very strong in both life and health and wealth sales, particularly in the small and mid-market segments. Both group and individual wealth delivered positive net cash flows. New product launches such as the Canada Life Sustainable Portfolios and good fund performance are attracting new client inflows. Wealth management is a strategic focus for us in Canada as we continue to enhance our products, services, and support for advisors. Subsequent to the quarter end, Canada Life and ClaimSecure launched Secure Pak. This new bundled offering includes Canada Life's insurance benefits and ClaimSecure's modern claims processing services. We expect this will be the first of many collaborations, and we see significant opportunity to extend our offering to plan sponsors via ClaimSecure. I'm also pleased to share that Brand Finance rated Canada Life the fourth most valuable brand in Canada. We're the first insurance company ever to make it to the top five. This recognition reflects the success of our rebranding efforts following the amalgamation of our three insurance companies in 2020. I would like to congratulate Jeff Macoun and his team on this remarkable achievement and for making Canada Life such a trusted and valued brand in the eyes of Canadians. Please turn to slide seven. In Europe, insurance and annuity sales were strong in the quarter. Equity release mortgage sales more than doubled year- over- year, with continued growth supported by an aging U.K. population and rising property values. Healthy momentum in bulk annuities was sustained with three deals totaling over CAD 400 million following sales of CAD 320 million last quarter. We've also been growing our wealth management presence across Europe. In recent years, we've acquired several smaller brokers and advisors in Ireland to extend our service offering, and we continue to expand distribution partnerships in the U.K. for our onshore and offshore wealth bonds. In addition, our technology investments are positioning us to grow share through new market segments. In Germany, for example, we're using a digital platform to access the small group pension market, building on our success in the retail pension savings space. Please turn to slide eight. Putnam's AUM was consistent with prior year at CAD 192 billion. Net outflows of CAD 2.4 billion were primarily due to continued outflows and lower fee fixed income products. Putnam's investment performance remains strong, as demonstrated by four- and five-star Morningstar ratings on 25 funds and over 80% of funds performing at levels above the Lipper median on both a three- and five-year basis. Please turn to slide nine. Empower continued to experience strong business momentum in the quarter. We've split Empower sales between defined contribution and individual retirement accounts, known as IRAs, and this is to highlight the top-line performance for each. This view will be increasingly important as we continue to grow the retail wealth management business at Empower. DC sales were strong this quarter at $35 billion. This included a mega sale of CAD 15 billion in quarter compared to last year where we had a large sale of CAD 49 billion. Retail wealth management, which combines Empower IRA and Personal Capital, experienced strong growth driven by positive cash flows and saw asset levels increase 30% year-over-year. I will cover this more in detail on the following page. Empower's overall assets reached CAD 1.1 trillion at the end of the quarter. This number grows to CAD 1.4 trillion, including Prudential. As noted earlier, our MassMutual and personal capital integration programs are progressing well and on track. We remain on track to achieve our cost synergy targets and are pleased with performance on all key metrics, including AUA and participant growth, retail asset growth, and client retention. The close of the Prudential acquisition last month marked another milestone for Empower as it represented the latest of three transformative acquisitions in the past two years. These transactions are pivotal to our longer-term strategy for Empower, both as a leader in DC retirement and as a growing retail wealth manager. Please turn to slide 10. As noted, I will now take a few moments to update you on the build-out of our retail wealth management strategy at Empower. We've made significant progress in the last two and a half years. I recall sharing on the second quarter call in 2019 that Empower IRA assets had reached CAD 10 billion. Since then, we've seen strong growth, both organically and through Personal Capital. Today, retail wealth assets are CAD 48 billion and growing. Personal Capital sales grew by 31% compared to Q1 last year, with assets under management up by 30% over the same period. Empower IRA sales are up 53% over Q1 last year, and assets under administration increased by 30% over 2021. This growth has come before we were able to leverage Personal Capital's technology and tools. Over the last few months, we've started to roll out our new digital participant experience at Empower, leveraging Personal Capital's capabilities. The new experience is now available to 3.5 million plan participants, growing to 8 million by the end of May. To support this retail growth opportunity, we've accelerated hiring, including over 250 sales and service staff, with half of those just in the past quarter. While increasing our costs in the short term, we are confident these investments will lead to strong IRA and retail growth as we work to fulfill the ever-growing need for advice and guidance from the millions of customers we serve. Please turn to slide 11. Capital and Risk Solutions base earnings increased 17% year-over-year, a strong result driven in part by new business growth, including U.S. health transactions and an innovative Israeli reinsurance transaction. U.S. traditional life reinsurance results improved, and while still impacted by COVID-19, were in line with industry experience. Capital and Risk Solutions has produced solid quarterly results reflecting its well-diversified reinsurance portfolio. The new business pipeline is strong in both structured and longevity reinsurance portfolios. We remain focused on our core U.S. and European markets as we pursue expansion opportunities in new markets such as Japan and Israel. With that, I'll now turn the call over to Garry to review the financial highlights. Garry? Thank you, Paul. Please turn to slide 13. Overall, as Paul noted, Lifeco produced solid financial results this quarter. In addition to the underlying momentum we see across the business, the results also reflect the mix of challenges and opportunities the current environment presents, rising rates and widening spreads, downward trends in stock markets with increased volatility, elevated inflation, and continuing COVID impacts. Compared to the prior year, base EPS of CAD 0.87 was up 9% and 12% in constant currency, reflecting a stronger Canadian dollar against European currencies. The EPS increase was due to several factors, including higher stock market levels year-over-year, broad-based business growth, and attractive yield enhancement opportunities. Experience pressures in certain businesses were offset by positive outcomes in others, delivering a solid overall result across a diversified book of business. At the Lifeco level, net EPS of CAD 0.83 grew 9% from Q1 2021, primarily due to the increase in base earnings as excluded items were a similar impact in both periods. Starting with Canada, base earnings were CAD 272 million, down 9% from Q1 last year. Insurance experience was a headwind this quarter, with lower group long-term disability results after several favorable quarters and an increase in individual life claims. New business gain and policyholder behavior was lower this quarter. However, Canada benefited from another strong contribution from yield enhancement, supported by widening spreads and continuing volumes of equity release mortgages. In the U.S., base earnings were up 15% year-over-year, led by strong organic growth at Empower, including the MassMutual business. We have combined these businesses for reporting in 2022 as they become increasingly more tightly integrated. We will continue to report on integration costs and synergies until the program closes out later this year. The Prudential business, which comes on board starting in Q2, will be shown separately for 2022 and will include separate reporting of the synergies and associated integration costs. Empower base earnings of $117 million were up 23% year-over-year, unchanged from the prior quarter. As a reminder, about 2/3 of the fees at Empower are asset-based. These fees benefited from the growth in markets year-over-year. However, they were negatively impacted by the decline in U.S. markets in Q1 this year. Fees were also impacted by expected client attrition and repricing in the acquired MassMutual portfolio, which was more concentrated at year-end given the January 1 renewal dates. I would note that client asset and revenue retention is going very well so far, running a little better than our acquisition modeling. Expenses were up year-over-year in line with the steady organic growth in DC plan participants and down from the elevated Q4 expenses as anticipated. Also, as Paul noted earlier, we have accelerated the build out of the retail wealth strategy with additional sales hires in Q1 2022 along with the necessary support staff, and this is expected to drive revenue growth in future quarters. On the integration front, the rollout of Personal Capital digital capabilities to the broader Empower client base continues at pace, with over 3.5 million participants now having access and over 4 million more coming on board in May. MassMutual expense synergies remain at CAD 80 million on an annualized run rate basis and are on track to deliver the CAD 160 million target once the integration is completed later this year. It is worth calling out that integration savings tend to be more pronounced at the start and at the end of a program, with early savings from eliminating duplicate overhead costs and then later savings arising as the prior admin systems and service agreements are discontinued post-conversion to Empower's platform. Putnam earnings were similar to Q1 last year, impacted by lower AUM based fees plus seed capital losses due to market declines in quarter. As we have seen in prior years, Q1 is a seasonally lower quarter for Putnam and Q4s are typically seasonally higher. The Europe segment had a very strong quarter in Q1, with base earnings up 22% year-over-year or 29% in constant currency, allowing for the appreciation of the Canadian dollar against euro and sterling. U.K. base earnings were up 15% year-over-year, benefiting from strong yield enhancement gains driven by the successful renegotiation of two large leases and good group mortality experience. Ireland base earnings increased 60% over a softer Q1 last year, largely driven by a turnaround in insurance experience. The results this year also included CAD 6 million of earnings from Ark Life, a closed block acquired late last year. Base earnings in Germany were up 5% year-over-year, in line with continued growth, particularly in the retail pensions business. In Capital and Risk Solutions, the reinsurance business continues to perform well with growth in the structured portfolio, experience gains in the longevity book, and continued improvement in U.S. life reinsurance mortality claims experience. For several quarters now, we have highlighted expected profit trends in CRS as a better measure of growth and volume since sales and AUM are not as meaningful. We are presenting an expanded view of CRS expected profit this quarter as part of the source of earnings additional details in order to provide more color into the movement period to period, and I'll come back to that shortly. Turning to slide 14. We can see here the impact of the various excluded items which net to CAD -39 million overall. These are predominantly acquisition related, including Personal Capital, MassMutual, as well as recent smaller Irish acquisitions in the wealth space. There are also impacts on actuarial liabilities, partly from minor assumption updates and partly market related impacts in the period. Turning to slides 15 and 16. These next two slides highlight the source of earnings, first from a base earnings perspective and then a net earnings view. I'll focus comments on slide 16, the net earnings SOE, with a reminder, the amounts above the line are pre-tax. Expected profit was up 6% year-over-year, notwithstanding some currency pressure with the euro down 7% and sterling down 3%, and also the lower contribution from CRS, expected profit noted earlier. The increase reflects higher fee income on higher markets, partially offset by higher expenses. Expected profit was down 4% versus the prior quarter due to seasonality in performance fees and compensation expenses at Putnam and higher expected expenses in Canada. Moving to new business impacts, the strain in Canada was higher than last year due to pricing pressures on term business and lower large case sales, offset by new business gains in reinsurance. Experience gains contributed positively in the quarter, and I'll cover these in more detail in the next slide. Earnings on surplus of CAD -41 million is down from CAD -31 million last year, primarily due to seed capital losses in Canada and higher financing costs. The effective tax rate this quarter was 10% on base shareholder earnings and 9% on net earnings. Primarily, this reflects the jurisdictional mix of earnings this period. The effective tax rate on base earnings in Q1 2021 was also 10%. Turning to slide 17. These tables expand on the experience results as well as the management actions and changes in assumptions to highlight various items in the quarter, some of which we've touched on already. As shown in the chart on the left, yield enhancement continued to contribute positively, particularly in Canada and the U.K. this quarter, with several large lease extensions in the U.K. and a continuing steady volume of new equity release mortgages to back liabilities in both the U.K. and Canada. The net impact of mortality, longevity, and morbidity was positive this period as we continue to benefit from diversification across risk types and geography. Annuitant mortality in CRS and Canada was favorable. Overall morbidity experience was positive, with higher disability claims in Canada more than offset by the combined impact of positive disability experience in Ireland and positive health experience in both Canada and Ireland. Overall mortality was in line with expectations. Credit-related impacts were broadly neutral, actually slightly positive this quarter, as our high-quality investment portfolio continues to perform well. The expense variance generally reflects strategic project costs and investments in growth. I'll review expenses in more detail in the next slide. The table on the right highlights that there are no material basis changes this quarter, and the acquisition-related transaction costs are just contingent consideration provisions related to recent acquisitions in Ireland. Moving to slide 18. Here, as I mentioned earlier, here we've broken out the expected profit for the Capital and Risk Solutions Group into two components. First, the fees and margins on reinsurance business, such as structured life and P&C catastrophe, which have been increasing as a result in growth in these lines of business. The second component is the release of actuarial margins known as PfADs or Provisions for Adverse Deviations, which predominantly applies to long-tail liabilities such as life reinsurance and annuities. As can be seen in the chart, we made changes to our balance sheet that have reduced the PfADs coming into 2022. At a high level, we released actuarial margins on the longevity businesses and strengthened our best estimate liabilities in traditional life reinsurance. All else being equal, this produces lower PfAD releases and expected profit, but better experience gains. Interestingly, as we move to IFRS 17, you'll see more of this type of split. With the reporting for fees and other margins largely unchanged, the PfADs being replaced by risk adjustment, and of course, a contractual service margin release will be on top of that. We are not yet in a position to share actual figures. That will come in 2023, but conceptually, this is how it would play out. Moving to slide 19, and this slide highlights the operating expenses by segment. Expenses are up year-over-year as expected, given the increase in business, both organically and through M&A. As is the case with many businesses, we are experiencing some modest inflationary pressure in labor and other costs. This is an area we'll monitor closely, increasing the focus on achieving productivity gains in our operations. In Canada, expenses were up 4% year-over-year, reflecting the acquisition of ClaimSecure and growth in sub-advisory fees. In the U.S., the expenses were up 6% year-over-year, which primarily reflects the organic growth in DC plan participants and the investments in the retail wealth strategy at Empower that Paul noted earlier. In Europe, expenses were steady year-over-year, but as noted earlier for earnings, currency movement had an impact, with expenses up 8% in constant currency. The increase is mainly due to acquisition-related costs in Ireland, including the Ark Life closed block and organic business growth across the segment. In Capital and Risk Solutions, expense growth is off a very small base and is aligned with growth in the business, including the continued expansion into newer markets. Please turn to slide 20. The Q4 book value per share of CAD 24.57 was up 5% year-over-year, primarily driven by strong retained earnings, given the solid results in each of the last four quarters. Currency translation in OCI has been a headwind this year with the strengthening Canadian dollar. However, the rise in interest rates has produced a largely offsetting gain in pension OCI. The LICAT ratio at Canada Life remains strong at 119% within our target range of 110%-120%. The ratio was down 5 points compared to last quarter, driven by interest rate increases, particularly at longer-term rates, in line with our sensitivity disclosures in the MD&A. We would describe the decline as a formulaic issue rather than economic, since in general, our business benefits from higher interest rates. As a reminder, under LICAT, a portion of the available capital is calculated at fair value, which declined this quarter as interest rates rose. However, the required capital is largely calculated at fixed rates as defined by OSFI, and so did not move in the same manner. In addition, I'd note that we switched LICAT scenarios last quarter, and scenario changes are smoothed in under LICAT, and the remaining smoothing is expected to lead to an increase of 1 point per quarter for the next four quarters. Lastly, Lifec o cash, which is not included in the LICAT ratio, ended the quarter at CAD 0.7 billion, a modest increase from last quarter, and this would convert to about 3 points on Canada Life's LICAT ratio. Back to you, Paul. Thanks, Garry. Please turn to slide 21. We are pleased with the momentum across Lifeco in the first quarter and remain focused on delivering on our medium-term financial objectives as we work to successfully integrate acquired businesses and execute on our strategy. Core to our strategy are four value creating priorities that represent areas of strength. Advice, digital capabilities, workplace relationships, and risk and investment expertise. We believe execution against these priorities will create greater value for shareholders and other stakeholders. This will include continued discipline in deployment of capital and advancing our commitment to making a positive impact in the world around us, especially related to the environment, diversity, equity and inclusion, and sustainability. It's with this mindset that we introduced three areas of focus for Lifeco's corporate purpose and social impact journey at our annual meeting this morning. These focus areas are truth and reconciliation, building inclusive communities that thrive, and investing in solutions that enable a more sustainable future. We recognize our role and responsibility to help address societal challenges, and that by doing so, we become more inclusive and reflective of the communities where we live and work. That concludes my formal remarks, operator. Please open the line for questions. Thank you. We will now begin the question and answer session. To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two. Our first question comes from Meny Grauman of Scotiabank. Please go ahead. Hi, good afternoon. You had a strong result in Europe, this past quarter. If we overlay expectations, most economists expect Europe to be in recession this year. Wondering, as you see it, what are the implications for your European business, given the sound economic outlook? If you focus on countries or products or both, where are you more vulnerable and where are you less vulnerable? Yeah. Thanks, Meny. It's Paul. I'll start off and then I'll hand it off to David Harney, who's responsible for that business segment. I'd start out by saying that I would refer to our businesses in Europe as very focused on needs-based financial services. You know, we provide a lot of pension savings support. We're involved in payout annuities. Those types of products and savings vehicles are really products that people will continue to act on and transact on in a lot of ways, regardless of the environment. Obviously, you know, market levels will have some sort of an impact, but you know, rising interest rates also make many of those products more attractive, things like payout annuities. Then things like bulk annuities are, you know, those are institutional transactions where there are going to be organizations that are going to be looking to sort of offload that liability, and we're well positioned to handle those. As I think about our businesses, and I'll let David get into it in more detail, I view our business as pretty resilient and strong, notwithstanding financial cycles. I'll let David go into a bit more detail. David? Yeah, thanks, Paul, and I'll probably repeat some of the same points. Like, so maybe just to share some sentiment from Europe. Like, I wouldn't say there are recessionary concerns or fears in Europe that are different than anywhere else in the rest of the world at the moment. Like, obviously, there's general concerns around inflation and rising interest rates, but I wouldn't attach any particular concern to Europe as a segment compared to other segments around the world. Like, we've had a strong quarter again this quarter, obviously boosted a little by yield enhancements. But even with that aside, we've had good results again this quarter. Like, as with the split of our earnings by the three markets, we've almost 50% in the U.K., 30% in Ireland, and 20% in Germany. Like, I suppose if we were to be worried anywhere about recession and maybe proximity to U.K.-Ukraine, it would be mostly in Germany. There, and that's probably a region in Europe that's growing the strongest. We've a very good position in the retail pension market there and the smaller occupational scheme market, and we're growing market share there. Even if Germany suffered a little bit more, we still expect that business to perform strongly over the next period. Then we have more mature positions in Ireland and the U.K. Paul talked about some of the product mix that we had in the U.K., which may not move that much even if there were some recessionary pressures. Then within Europe, Ireland is a very fast growing economy. Even through COVID, Ireland was one of the few economies within Europe that showed growth. Hopefully that gives some color. Yeah. Thanks for that. Then maybe just switching gears. If I heard you correctly, there was some discussion earlier in the presentation about accelerating investments in U.S. retail wealth. I wanted to make sure I heard that correctly. Is that sounds like a change in the pace of investment there. I'm just wondering what drove that change. Why is it being accelerated now. Thanks. Meny, I'll start off with that. I would characterize that when we looked at the Personal Capital and the various MassMutual and Prudential acquisitions, we'd always had a vision towards building out a retail wealth business. That goes beyond thinking about the IRA rollover business. It's a broader opportunity. When we talk about accelerate, I think our focus had always been that once we started to actually integrate the Personal Capital capabilities into the system, we were going to be far better positioned to actually now reach out and to connect with clients and to offer these additional services. It's a timing issue. I'll let Ed give you some context around why now and why this timing makes sense relative to the work we've done with Personal Capital. Ed? Sure. Thank you, Paul. Yeah, I think if you look at the opportunity that we have, we have somewhere between CAD 70 billion-CAD 85 billion of money that's in motion every year coming off of our platform due to early retirement, job changes, other life events. There's a real opportunity for us to work with many of those participants and guide them through the process around whether those assets should stay in plan, roll to a third party, roll to us. We have a very needs-based approach to do that. As we've scaled the business, particularly over the last 18 months, and we're adding millions of participants on the platform, it's important that we continue to build out those capabilities so that we can serve customers, not just while they're an in-plan participant, but out-of-plan. We also have a number of those customers that are in-plan participants that have an understanding of our capabilities, particularly after the Personal Capital acquisition, where we can help them and work with them in other areas, other goal areas, other objectives, whether it's college savings, whether it's emergency savings. That creates a real opportunity for us. Just a really significant demand and appetite for advice, for guidance, for a holistic approach that's been emerging over the last few years. I think what you've seen here over the last year, and particularly in the last quarter, you're gonna continue to see more investment and more growth in the business. We will be adding more talent to support the demand. Just to be clear, so are you responding to any change out there in the market? Any sort of competitive change or any sort of regulatory change that's pushing you to move faster here? No, I think it's just the fact that over 70% of Americans today don't have a financial plan. They don't have a retirement plan. All the surveys, including our customer surveys, suggest that there's just an insatiable appetite for guidance and advice. People aren't clear on what to do, and they typically want to talk to somebody. What we're doing is obviously building out a state-of-the-art digitally enabled capability, sales and service, but also incorporating the human dynamics. The ability to work with a human advisor and someone that can help them and guide them through this process. Thank you. Yeah. Meny, I might just add one thing. When we actually positioned the two acquisitions of MassMutual and Pru, in both instances, we talked about the expense synergies, and we also talked about revenue synergies. The revenue synergies there were more broadly the traditional IRA rollover capture opportunity. What Ed is talking about here is stepping well beyond that. I think that had been part of the vision we talked about. The real value unlocked for us and for Ed, you know, for Ed and his team is the deployment of this Personal Capital hybrid digital advice. If we're actually gonna have it out there, we're gonna have potentially, you know, 17 million Americans reaching out for help. We actually have to have people to actually support that hybrid digital experience. The timing is now that we need to start ramping up the capabilities so we can really start to build out and unlock this retail wealth management growth. All right. Thank you. Our next question comes from Doug Young of Desjardins Capital Markets. Please go ahead. Hi, good afternoon. Just sticking with Empower, a two-pronged question. Of that CAD 70 million-CAD 85 million in annual money in motion, how much are you capturing today and Billion. Sorry, billion in money in motion. How much are you capturing today, and where do you plan to take that? Second question, just the annualized run rate cost synergies of CAD 80 million didn't change quarter-over-quarter. I think in the prepared remarks, it was talked a bit about the front and the end being more impactful. Just hoping you can flesh out. I would have expected a little bit more in terms of annual run rate cost synergies from MassMutual sequentially, just hoping to get a little color on that. I have a follow-up. I think, Ed, you’re well positioned to respond to both those. Yeah. Well, I think on the second part of your question, I would say that the prepared remarks, I think, really reflect what we're seeing. You know, as we noted, we expect to hit our targets of CAD 160 million pre-tax run rate synergies at the end of 2022. You know, we were probably slightly ahead of plan early on, but we're on target with what we've conveyed to everyone. In terms of, I think your first question had to do with the capture opportunity. Yes, as we implement better tools, better capabilities, particularly through the Personal Capital acquisition. We believe we're gonna see more efficiency and more effectiveness there. I will say that the approach that we take is very much a needs-based approach. 99% of our plan sponsors, the institutions that we serve, have effectively signed off on our service because of the approach that we take. What we do is we wanna understand what the client's objectives are. Sometimes it's a benefit to them to stay in the plan, even though they've retired or they've changed jobs, they could leave the money in the plan and get the benefit of institutional pricing. Some have an existing relationship, and they may roll to an existing relationship, and others are not working with an advisor. There's an opportunity for us to help them. I think what we'll see, what we have seen, and what we'll continue to see is higher effectiveness, higher efficiency, higher capture rates, given the strength of our value proposition. Maybe just to put a finer point on it, how much of like have you talked or disclosed how much you're capturing of that right now and where you think you can take it? 'Cause I know others have, and I think 50% obviously would be high, but I think others are achieving that. Just wondering where you are. Well, first of all, you know, it's. People do the math differently. Sure. As I mentioned, there are customers that decide to stay in plan. There's a large percentage of customers that actually cash out. They pay the penalty, they pay the 10% penalty, they pay the taxes, and they cash out. You really have to look at what the numerator is. I think at this point, we wouldn't disclose those capture rates. I would submit that they're industry-leading at this stage, and we believe we can improve upon them. Okay. Yeah. I just. Doug, I was just gonna say, like, we're not at a point where we're gonna disclose the details of what our current capture rate and exactly where we're gonna go. We actually see we're at a point right now where we see a double upside. The first upside is a more digital, better customer-oriented experience is going to result in people being more satisfied and wanting to buy into the opportunity within Empower. The second one is, as you grow from 7 million to 12 million to 17 million participants, you now have, as Ed said, CAD 80 billion of money in motion, as opposed to before, where we had CAD 25 billion-CAD 30 billion of money in motion. Therefore, we're investing to grow this business, and it's an opportunity that's before us and one that we think is a significant one. Okay. Then just second on Canada, I guess two questions. First is, you know, new business strain was higher, which I was a bit surprised given where interest rates went. So just hoping to get a better sense of dynamic. Maybe there's a mix change. And then the group morbidity side was negative. I'm just trying to get a sense of, was the group morbidity experience, long-term disability experience negative, or was it just less favorable than what you're seeing last year? 'Cause I thought it sounded like the message was a bit different than what we heard last quarter. I'll start off at a high level, and Garry may wanna talk a bit to the new business strain, and I know Jeff will want to share with you his insights into the group. I'll start off on the group one. No, we did not lose money on this. This is. What we saw in the period was, you know, reduced gains because of the nature of claims incidents and claims termination rates. But, you know, I always like to remind that we've been in this business for a long time. I would argue we are the best at it in Canada and perhaps, you know, maybe one of the top in North America or the world because we actually have the experience, the insights, and we take action when we see challenges in the business. We've seen LTD volatility many times before. We've responded to it, and we always get back on track. We look at this as an in-period issue. I think, you know, Jeff could provide a little bit of insight into the in-period issue, and then maybe Garry could speak to new business strain after that. Garry? Jeff, do you wanna speak to the LTD in-period? Sure. Yeah. Thanks, Doug. Paul, thank you. Yeah, I was just reflecting. I think it's been, gosh, at least six quarters in a row of sort of sub-stellar results on the group LTD. I'd say this, Doug. I mean, our fundamentals are still very much in place. You know, I think about this business here, our renewals, this is, you know, generally a one-year renewable business. We renew the business at or above the targets, and we've been doing that, so that's in place. We're very careful on our case selection. That's still in place. The rate adjustments that we place each year are at target or above. We took pricing action in 2021. That's now flowing through the system. We were also proactive in early 2022 with further rate adjustments on this business and managing this. Our persistency has remained well. We're very bullish on this business. As Paul outlined, Doug, we did see in quarter a small spike in incidents, and our terminations or claims coming off were in line, but they were smaller. There was a small impact on inflation, but you know, we continue to be quite bullish. The fundamentals are in place and we feel strong about this business. Yeah. Garry, do you wanna comment on new business strain in quarter? Yeah. I'll just make a couple of quick comments there. First off, part of this was due, and I think I mentioned in the speaking comments, there was, you know, there were some pricing pressures in the term market in Canada, and that had a lower contribution to new business. That's not as impacted by interest rates. Also the interest rates tended to rise towards the back end of the quarter. It's something I think that the rising interest rates, you are correct, Doug, those will benefit the strain calculations in future quarters. There wasn't much of an impact from the interest rates in the quarter. Then as I think also noted that we didn't have as many of the larger sales that would cover some of the acquisition costs. It's a little more a stranded acquisition cost or that contributes to that new business result. A little worse, but nothing we're overly concerned about. Good. Thank you. Thanks, Doug. Our next question comes from Tom MacKinnon of BMO Capital Markets. Please go ahead. Yeah, thanks for taking my question and good afternoon, everyone. A question with respect to LICAT at 119% and 5 points down quarter-over-quarter on rising interest rates. Rates continue to rise here, and if we look, you know, at the U.S. 10-year, it's second quarter to date, almost up as much as it was in all of the first quarter. You know, conceptually, that could be another up to 5 basis points hit on your LICAT. Wondering what your thoughts are with respect to maintaining that LICAT within your 110%-120% preferred range as rates continue to go up. What kind of levers do you have here other than, you know, downstreaming some money from the holdco? I've got a follow-up. Thanks. Yeah. Okay, thanks, Tom. I'm going to turn that one right over to Garry. Garry? Yeah, sure. Obviously, as you pointed out, Tom, right now we're right near the top end of our target range. There is obviously room within the range comfortably. Starting from that position, also I'd remind we do have those 4 points of scenario smoothing that are going to be adding to the ratio each period. We look at those as, and with higher interest rates, that keeps us in that scenario. Those 4 points are looking good. You mentioned the Lifeco cash that could be downstreamed. I think that wouldn't be our preference in the short term, but it is an option available to us as another 3 points at quarter end. In terms of beyond that, I think there's you'd be looking at ALM strategies. When we're doing that, we are mindful. Our work suggests that IFRS 17 is not as sensitive to this, has some offsetting sensitivities. We expect to hear from the OSFI in around the second quarter results, what their transition rules are. I think that might also come into play in as LICAT unfolds for the rest of this year. At this point, we're comfortable where we are. We are watching the rates. I think there's one other thing I should point out. You mentioned the U.S. rates. Their sensitivities are largest to the Canadian and the sterling and a little bit on the euro. It's the longer rates, like 10-20-year type rates that we'd. You know, short-term rates, bank, and the Feds putting rates up. It's really those longer-term rates you've got to be looking at. It's really across those three currencies are the main ones that drive it because this is the fair values on the PfADs backing our long liabilities, which is Canada long-tail insurance and European paid annuities primarily. With respect to the LICAT, it's best to look at the longer rates associated with Canada and euro. Is that because that's where you house some of this excess capital? That's where we have these actuarial PfADs. OSFI allows you to count your insurance PfADs in the available capital, but they're measured at fair value. Ours, our margins are against our annuity books and against our insurance books. Yes. Got it. It is the long-term rates. Okay. Got it. For sterling, Canada and euros. Thanks. As a follow-up, with respect to Empower here, if I look at, you know, over the last four quarters, second, third, fourth, and the first, the AUA has been relatively flat. Participants are up, but the earnings, the base earnings for Empower in U.S. dollars in the second and the third quarter last year were substantially higher than what they've been in the fourth quarter of last year and the first quarter of this year. You know, I used to think that it was driven by AUA and participants, but is this trend that we're seeing here with the earnings now kind of flat quarter-over-quarter at Empower and down, if we look from second and third quarter last year down, you know, at least 15% over those levels, is this because you're investing in the business? Going forward, is there any other seasonality associated with the earnings here at Empower that would 'cause now it's poised to look like if they're flat quarter-over-quarter, they're going to be down substantially year-over-year. I will tell you, Tom, we're actually feeling very confident in the acquisition integrations. We're capturing the percentage of clients we expected or better. We're on track to deliver on the synergies. Ultimately, you know, driving for the value creation, we're very confident in that. The one thing we can't control is what's happening with equity market levels, because, you know, there's significant fee income that features in Empower earnings. I'm going to let Garry provide a little bit of context on the relative quarter-to-quarter performance. Garry? Thanks, Paul. Tom, just on that generally speaking, I mean, the AUA and participants is high-level metrics give you know, some good trending to keep an eye on. Obviously, the mix in AUA can have an impact. You know, at certain types of businesses, certain institutional versus retail, those type of things can have an impact. For your specific questions on the growth in retail should actually prove to be a benefit going forward. In terms of the quarters you've called out specifically, you may recall having discussions on this in the quarters last year. We had some very favorable surplus income gains in both Q2 and Q3, and to a lesser extent, Q4 last year. Again, these aren't seasonal. Some of these were some of our alternatives. Our early investments in some of the alternatives strategies were paying off. We had some good realized gains in those two quarters that probably gave you a little bit higher income in that than just looking at the straight AUA and plan participants. This quarter, if anything, we were a little below what we might typically see in the surplus income. It was positive, but it was not at the levels in those quarters by any stretch. There were some FX headwinds, for example, that probably dragged us down a few million. The surplus income in the back can also have moved that around a bit. Again, the synergies obviously we are picking up synergies as we go through. We didn't have any new synergy wins coming in in this period, but there are certainly as we go through the rest of this year, we'd expect those synergy gains to come in and add. Again, that's not going to track to AUA or participants. That's going to be on top of that growth. Thanks, Garry. That's helpful. Our next question comes from Gabriel Dechaine of National Bank Financial. Please go ahead. Hi. Good afternoon. Can you just give me a little explanation as to the shift in the makeup of your reinsurance business earnings? Like, EPIF earnings on SURP, expected profits, sorry, going down, but you'll have more experience gains, something like that. What happened to the business that caused this shift? Thanks, Gabe. I'm gonna turn that one over to Garry. Garry? Sure. First, I point out nothing's actually happened to the business. This is, I mean, the business has been growing quite well. A lot of this is geography when the Source of Earnings display. Mm-hmm. That's always important to keep in mind that this is just both the timing of earnings and also the geography of them. I think if you recall, we had you know we've seen quite a bit of growth. We had really strong growth in our reinsurance business over the last few years, and that included significant longevity transactions. If you recall, going back a number of years ago, we had very sizable longevity reserve releases as we updated our longevity best estimate assumptions. This impacted the U.K. as well as reinsurance. The U.K. would have had it with their bulk annuities. In both cases, as we made those steps, brought on the new business or, released some of those, we held back prudent PfADs because we wanted to observe this playing out over a couple of years. Given the trends we've observed and the experience we've had, we've actually reduced these PfADs in line with the lower risks that we now see. Sure. They would have come into our earnings last year as basis changes. At the same time, given other trends we're seeing in the U.S. life mortality segment, and obviously COVID's had some impact here, those trends, what we did there was we strengthened our best estimate. That gives you greater chance of. The stronger your best estimate, the greater your chance you'd have future either gains or lower losses in the future period. The changing overall, we didn't see a lot of P&L impact last year. Yeah. We moved from a lighter PfADs and stronger best estimates, and it changes the geography and the source of earnings. Does that make sense? I guess you were having consistent longevity gains and then released the excess PfADs, so maybe that, like, you front-ended some profits essentially last year and prior years. Yeah, we would have brought those PfADs into earnings last year. Yeah. We're not getting them on the drip each quarter as it goes through. Got it. Gabe, one of the things we've talked about was the offsetting movement of the longevity business and the insurance business related to COVID. Yeah. This kind of plays to that, right? Hello? Hello? We're even seeing. Have we been lost? I can hear you. Gabriel? Can you hear me? Can you hear me? Can you hear? Yes, we can hear you, Gabriel. We can hear you. Okay. Yeah, I heard you. I hear you. It must have been a glitch. Yeah. I was saying this plays to the theme we've talked about with COVID, with you know, longevity, you know, challenges obviously for you know, and seeing what's going on with life mortality. We were essentially following the risk and making sure that we had the right strength in our balance sheet. Yeah. Got it. Okay. It just changed the. Sure. I got a question about the group business now. Okay, so I got the explanation about the, you know, the disability experience this quarter. I don't know if you ever, you know, look at, I'm sure you do, but I know in, on Canadian earnings call, insurance calls, we never talk about the benefits ratio. If I look at the, you know, supplement and I, you know, the claims paid divided by premium, you know, we're in the low 60s. Last year was in the high 50s, I guess so. I mean, if I look at pre-COVID levels of, you know, mid- to high 80s, I mean, is it reasonable to be looking at that benefits ratio and think, well, what we're seeing today is maybe some normalization, and normalization could actually mean, you know, more pressure on earnings growth and group down the road if it gets to, you know, benefits ratio like we had pre-COVID. I would start by saying, I think the benefits ratio at an overall level like there is a pretty blunt instrument. Your mix- Mm-hmm Of business can be, your mix of business can have a significant impact on that. For example, if you're growing your large case business, you could be shifting a lot to fee-based income as opposed to claims-based income. Your health benefits would have a very different claims ratio than your LTD benefits. I wouldn't want to go to something like that over at that level to really get in underneath that. The reality is we're in a competitive market where every case is renewed with a broker and with a client who is looking for value for the services they've received. Mm-hmm. The reality is, we're always gonna be competing on that on a very, you know, on the front foot, but making sure that we're providing good value to customers. Okay. Well, I'm just a hammer looking for a nail. That number we can revisit in the future. Thanks for that. Thanks, Gabe. Our next question comes from Paul Holden of CIBC. Please go ahead. Thanks. Good afternoon. I want to go back to the discussion on regulatory capital. I guess my first question, want to make sure there's no LICAT impact from closing the Prudential acquisition. Can you remind us on that? Yeah, I'll let Garry speak to the LICAT matters. Garry? Nope. There is no LICAT impact closing Prudential. Okay. Perfect. Sort of a follow-up question to what was being asked before, because your answer was interesting. Clearly, there's interest rate sensitivity to the LICAT ratio, and it's fairly significant. Is your answer suggesting that you think with discussions with OSFI and potentially simply putting in ALM derivative strategies today, you can kind of bridge the gap between now and when IFRS 17 is implemented next year and thereby avoid having to unnecessarily issue capital? Like, that's what I kind of got from your message, but I wanna make sure I interpret it correctly. Yeah. I'd say broadly, Paul, you're on track. Our view is that the movement we've seen in LICAT is really not economic. It's formulaic. We're at the top end of our range. We've got the benefit of, you know, the scenario switch that's coming in. There's actions we can take that make sense for our invested assets, both today and under IFRS 17. As we look at it, we've got lots of strength. We wouldn't be minded to do something that costs real money, that had a real economic impact on our balance sheet or on our income statement when there's a noneconomic impact going on. That's probably the way I would think about it. For a period of nine months, it would make no sense to do that. What we're gonna do is we're gonna manage with the tools we've got. We're gonna take advantage of the strength we've got in the business, and we're going to really work towards a smooth transition to IFRS 17. Okay. I think I understand from your position. I guess really the concern I would have, does OSFI have a similar view? Maybe you can't, you know, speak on behalf of OSFI, but I think I appreciate what you're saying. Yeah. Okay. Yeah, I can't speak on behalf of OSFI, but we actually have a very good interaction with OSFI. We've been working with them effectively, as have our industry counterparts. They understand the dynamics of this as well. You know, I think, you know, sound minds will land in the right place as we transition to IFRS 17. Got it. Okay. That's helpful. Thank you, Paul. Next question is going back to Capital and Risk Solutions and that new disclosure around the PfADs versus other margin and fees. That disclosure is helpful. I guess my question is, and maybe this is where CSM accounting would actually be helpful. Where can we kind of expect that PfAD release drawdown to reach a point of equilibrium? i.e., you know, how much based on roughly what you would expect for new business volumes, like, does it continue to decline quarter- over- quarter for a few more quarters? Does it stabilize relative to Q1? Any kind of characterization you can provide us there would be helpful. That's one for Garry, for sure. Garry. Sure. Yeah, I think really just to get to the heart of the question, I don't see anything that would have the PfADs drifting up or down over the next few quarters for that business. It's a fairly stable block, primarily the annuity and the reinsurance business there. There's no major plan changes pre-IFRS 17 conversion. I'm not expecting anything to move there other than, you know, there'll be currency impacts obviously if that moves, but because they're in foreign currencies. No, that should be fairly stable. Understood. Thank you. Last question is with respect to individual insurance sales in Canada. They were down 15% year-over-year, maybe some commentary there. Do you think that's due to industry headwinds or is there anything company specific we should be aware of? That's a question, Paul, that I'll turn over to Jeff Macoun. Jeff, do you want to take that? Sure. Thanks, Paul. Thanks for asking that question. I mean, just in general, if I could, on sales in the quarter, you know, overall, I was quite pleased with our sales. We did call out on the group side two one-timers that didn't repeat, but both of those businesses were up significantly 62% on group GRS and about 100% on group life and health. On the individual life, Paul, it's a relatively lumpy business, the par business in the high net worth market. In the quarter, our term business was up about 13% year-over-year. I look upon the term business as, you know, sort of confidence in the company. We had high 13% growth in quarter, so I was very pleased with that. The par was down. It's a lumpy business. You know, you win and lose at times by the big cases, and some of the big cases did not come in quarter. Just to finish off the sort of the circle, you know, I was quite pleased with our retail wealth side. We had good net flows. But on the individual life insurance side, term was up, sales. The par didn't meet our expectations. It's lumpy. You know, I'm confident that'll come back later in the year. Okay. Thank you for that. That's all the questions I had. Thank you. Thanks, Paul. Once again, if you have a question, please press star then one. Our next question comes from Darko Mihelic of RBC Capital Markets. Please go ahead. Hi. Thank you. Just to return one more time back to the Capital and Risk Solutions expected profit slide. I just didn't quite understand your answer, Garry, when you said it's a stable block. Okay, it's a stable block. Were you also suggesting that the PfAD releases get smaller every subsequent quarter from here on in? Or did you mean it's stable, i.e., the CAD 76 million that was released this quarter will remain stable at CAD 76 million for the next three quarters? It was the latter. It's a fairly stable block. I mean, if we have new sales, obviously that's gonna, you know, would add to the PfAD run rate. Typically there's a natural sort of decline of the block. Your new sales typically just replace your in force as it runs down. You end up quite stable is what I was referring to. Okay. Obviously you can't predict the number and you can't predict the currency, but using your example is good. Okay. Thank you. That's very helpful. Just so I understand what you're doing actuarially, because it strikes me that sometimes when I hear your language, it's different from others. In other words, I think one of the things you said was in your U.S. life mortality block, you strengthened your best estimate. Typically, when I speak to other insurers, they'll say that, "Yes, we strengthened the best estimate, and as a result, we increased the PfAD as well." But in your case, it didn't sound that way. Did you actually lower your margin for adverse deviation, or why would you not have built your PfAD when you strengthened your best estimate? Garry, that's definitely for you. Sure. When we and I'll start with the two things to clear up. One, first on the U.S. life mortality, that was strengthening our best estimate. We already had a you know a good healthy margin on top of that. If it's you know X percent of the best estimate, it stayed as X percent. You strengthening your best estimate is the move we made there. The margins we already felt were quite sufficient for that. The margins sit on top of the best estimate. That's important to remember. We moved our best estimate and the margin that sat on top of it was you know X percent above that, and we've kept that the same. What I was referring to here, reducing the margins, that's where in prior years we had lowered our best estimate to, you know, a more favorable outcome for the future for the longevity business, and this was in Europe, and that has come over a number of years. For a temporary period, well, for a number of years, we kept higher our margins on top of that best estimate until we saw the trends play out. Last year, as we said, you know, we've been watching this for a number of years, and obviously we're looking out further just how COVID's impacted. We're saying, "Yeah, we really feel that those are, you know, beyond the higher end of our range," and we released some of those. Released some margins on the longevity side. The release of those margins was not directly tied to U.S. mortality other than obviously we're looking at the same sort of outlook in a post-COVID world for both of them. It was more. There are two different decisions on the two different blocks. Okay. Understood. I think I can make a few other inferences from that as well, but I'll leave it there on the actuarial side. I just wanted to go back again to the Prudential acquisition. I appreciate there's no impact on LICAT, but it certainly does hit your leverage ratios, which would reduce some of your flexibility, I think, in managing capital. Can you talk to us about a pro forma leverage after the Pru? Sure. I'll pass that over to Garry. Actually, I'll start out by saying, you know, we've used a very efficient financing structure in relation to Pru as a starting point. We have, you know, clear intentions to take down our leverage ratios on a proactive basis. Obviously, we'll do that in a very balanced way. We actually have clear plans. We work with the rating agencies who have good insight into where we're going, and I'll allow Garry to sort of speak to that. Yeah. As you recall, as part of the financing, we have short-term debt that we were adding to this, and this is what would cause the leverage to go up in the near term. We didn't end up adding as much of the short-term debt as we'd originally anticipated. I think we'd originally called out $1 billion, and it ended up just over $800 million. I think it was $823 million in terms of the short-term debt sleeve. That's something that's as the business grows, and obviously, as the U.S. develops as earnings, we'd be able to pay that down quite promptly. Our leverage ratio will pop up in the near term. I think it'll be around in the 36% range. Then, as we pay down that short-term, those short-term facilities, it'll come down into our targets. We've discussed all this financing plan with the rating agencies well in advance. You may recall a large part of the financing that we put in place last year was our LRCN, the limited recourse capital notes. Those are already in all the numbers and obviously have favorable rating agency treatments. It really is just a short-term sleeve. Okay, that's very helpful. Thanks very much, Garry. Thanks, Darko. This concludes the question and answer session. I would like to turn the conference back over to Mr. Mahon for any closing remarks. Thanks, Ariel, and I'd like to thank everyone for attending our Q1 call. Please, feel free to reach out to our IR team for any follow-up questions you may have. We hope that everyone enjoys the beginning of spring and a bit of an early summer break, and we really look forward to reconnecting at our second quarter call in August. Take care. This concludes today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.