Welcome to American Equity Investment Life Holding Company's third quarter 2022 conference call. At this time, for opening remarks and introductions, I'd like to turn the call over to Julie Heidemann, Coordinator of Investor Relations. Good morning, and welcome to American Equity Investment Life Holding Company's conference call to discuss third quarter 2022 earnings. Our earnings release and financial supplement can be found on our website at www.american-equity.com. Non-GAAP financial measures discussed on today's call and reconciliations of non-GAAP financial measures to the most comparable GAAP measures can be found in those documents or elsewhere on our investor relations portion of our website. Presenting on today's call are Anant Bhalla, Chief Executive Officer, and Axel André, Chief Financial Officer. Some of our comments will contain forward-looking statements which refer or relate to future results, many of which we have identified in our earnings release. Our actual results could significantly differ due to many risks, including the risk factors in our SEC filings. An audio replay will be made available on our website shortly after today's call. It is now my pleasure to introduce Anant Bhalla. Thank you, Julie. Good morning, and thank you all for your interest in American Equity. We are now at the two-year anniversary of announcing the AEL 2.0 strategy. Even in tumultuous markets, we are witnessing the resilience in our business results due to the successful execution of the strategy. Additionally, we are proud to share that American Equity Life has been ranked as number one for customer satisfaction among annuity providers in the J.D. Power 2022 U.S. Individual Annuity Study. This is a demonstration of our focus on winning through a combination of product competitiveness, policyholder focus, producer loyalty, driven by our leading client service and value-added marketing support provided to our distribution partners. In the investment area, as markets reprice risk-return attractiveness across asset classes, we continue to see unique opportunities in private assets. In the quarter, we put an additional $1.3 billion to work in private assets, bringing our total allocation to private assets to 18.4% of the investment portfolio. We put over $1 billion to work in the real estate sector, primarily in non-qualified mortgages, residential transition loans, and single-family real estate at an average expected return of close to 6%. We remain constructive on rental housing as housing affordability continues to remain difficult. Residential real estate loans are also attractive with improved underwriting and yields that are now in the upper 6%-7% range. As you suspect, the supply of residential mortgages has slowed considerably with higher rates as well as the decision to tighten underwriting standards. We are seeing attractive risk-adjusted yields in directly originated middle market credit through our Adams Street Partners partnership and increased origination of directly sourced opportunistic specialty credit and real assets. In essence, our sourcing of unique cash flowing and yield-oriented private assets is gaining momentum. Beyond our real estate investments, our focus in the next six to twelve months is going to be on executing internal securitizations or ratings efficient structuring of directly sourced assets in middle market credit, specialty credit, and cash flowing infrastructure equity. Moving on, capital return to shareholders remain robust given our strong capitalization position and having proactively reduced risk on a significant portion of the public fixed income structured assets portfolio prior to 2022. We repurchased 4.2 million shares in the third quarter for a total spend of $154 million and remain committed to our current capital return plans. Total common stock repurchases through the first nine months of the year were 13.6 million shares at an average price of $38.37. With this, we have fully repurchased the 6.8 million shares issued to Brookfield on January fourth and additionally repurchased 263 million shares through the third quarter. At the end of September, we had $202 million of remaining share repurchase authorization. In the go-to-market area, we saw a decline in sales of fixed index annuities of 6% compared to the second quarter as we chose pricing discipline over chasing the market as interest rates fluctuated. Our focus on growing income product sales continues. We are very pleased to see American Equity Life IncomeShield sales rise 20% from the second quarter and increase 28% versus the comparable period a year earlier. Eagle Select Income Focus sales were flat sequentially. In accumulation products in the third quarter, we continued to see competitors raise product rates with cost of money potentially well in excess of 4%, thereby already pricing in a sustained level of higher interest rates in the future. This compares with us choosing to take a more measured approach to the trajectory of future ten-year U.S. Treasury rates, thereby using a lower option budget or cost of money to have resilient product profitability in case the rise in interest rates is more fleeting and not sustained over the product life cycle. We saw total enterprise accumulation sales decline 21% compared to the second quarter, driven by commoditized rate-based competition in the S&P 500 based strategies. The focus on sustained product profitability is a core tenet of our AEL 2.0 approach for a host of reasons. First, the basis of our go-to-market differentiation is a combination of product competitiveness, customer service, and the ease of doing business for the financial advisor with American Equity. Second, being an at-scale player with $52 billion of in-force FIAs, we are able to stay focused on product pricing discipline, targeting double-digit IRRs to be able to convert those sales to ROA-able liabilities in future reinsurance sidecars. Given the recent trajectory of Fed rate actions, likely guidance on terminal rates, and overall outlook for a sustained interest rate level of 4% or higher, in November, we are raising our accumulation product option budgets to reflect new money asset returns that can be sustained around 6% or higher, and therefore will be more competitive in terms of pricing. We expect that these rate actions will be reflected in December sales and to set the momentum for FIA sales going into 2023, while also meeting our product pricing hurdles of double-digit IRRs that can then be converted to ROA-able liabilities in reinsurance sidecars over time. Additionally, we will likely enter the registered index annuity or RILA product market within the next 18 months as we implement a new policy administration system for new business and further upgrade our go-to-market approaches. Moving on to earnings results. We were generally pleased with the quarter reporting non-GAAP operating earnings per share of $0.99, excluding notable items, driven by strong yields on our investment portfolio, in-line expenses, and a continued decline in share count driven by our capital return execution. These are solid results in a quarter where there was near zero benefit from equity market index credits, which implicitly reflects a $0.29 per share headwind versus a normal equity index credit quarter. Now, I'll turn the call over to Axel to get into the earnings details. Axel? Thank you, Anant. Let me start by extending my appreciation to all of you attending this call. For the third quarter of 2022, we reported non-GAAP operating income of $114 million or $1.29 per diluted common share, compared to non-GAAP operating income of $79.5 million or $0.85 per diluted common share for the third quarter of 2021. Excluding actuarial assumption updates, which was the first notable item this year and the single notable item for this quarter, operating income for the third quarter of 2022 was $87.4 million or $0.99 per diluted common share, compared with $136.3 million or $1.46 per diluted common share in the year ago quarter. Third quarter 2022 non-GAAP operating results were positively affected by $26.6 million or $0.30 per diluted common share from updates to actuarial assumptions. Third quarter 2021 non-GAAP operating results were negatively affected by $56.8 million or $0.61 per diluted common share from such updates. On a pre-tax basis, the effect of the third quarter 2022 updates before the change to earnings pattern resulting from these updates increased amortization of deferred policy acquisition costs and deferred sales inducements by $19 million and decreased the liability for future payments under lifetime income benefit riders by $53 million for a total increase in pre-tax operating income of $34 million. The actuarial adjustments to amortization of deferred policy acquisition costs and deferred sales inducements, as well as the decrease in the liability for future payments under lifetime income benefit riders, primarily reflected changes in our assumptions regarding future interest margins, lapsation, mortality, and lifetime income benefit rider utilization. We have updated our assumption for aggregate spread at American Equity Life to remain steady at 2.6% through the eight-year reversion period, with a near-term discount rate through June 2024 of 1.7%, eventually grading to 2.4% by the end of the eight-year reversion period. Last year, we set our assumptions for aggregate spread at American Equity Life to increase from 2.25% in the fourth quarter of 2021 to 2.40% by year-end of 2022, and then to move to 2.50% at the end of the eight-year reversion period, with a near-term discount rate through 2023 of 1.55% and eventually grading to 2.10% by the end of the eight-year reversion period. The effect of this change was to decrease DAC and DSI amortization by $106 million pre-tax, and to decrease the liability for guaranteed lifetime income benefit payments by $209 million pre-tax. Returning to our third quarter of 2022 actuarial revisions, in response to recent experience, we made changes to lifetime income benefit rider utilization assumptions, which resulted in a decrease in DAC and DSI amortization of $60 million pre-tax, while increasing the reserve for guaranteed lifetime income benefit payments by $118 million. The final major change was to increase our lapse assumptions on non-utilized guaranteed retirement income policies, reduce lapse assumptions on utilized guaranteed retirement income policies, and generally increase partial withdrawal assumptions on the total book of business, resulting in an increase in the reserve for lifetime income benefit payments of $20 million and an increase in DAC and DSI amortization of $200 million. The quarter included $11 million of revenues from reinsurance stemming from our Brookfield Reinsurance relationship, up from $9 million in the second quarter of this year. These revenues included the expansion of the relationship to include sales of EstateShield and Eagle Select Income Focus effective July 1, 2021. Account value and notional value of in-force subject to recurring fees ceded for these two products reflected sales from July 1, 2021 through June 30, 2022 of approximately $260 million and $235 million, respectively. Average yield on invested assets was 4.48% in the third quarter of 2022, compared to 4.33% in the second quarter. The increase was primarily attributable to a 15 basis points benefit from the increase in short-term rates on our floating rate assets. The average adjusted yield, excluding non-trendable prepayments, was 4.45% in the third quarter of 2022, compared to 4.28% in the second quarter of 2022. Partnerships and other mark-to-market assets, which are reported on a one quarter lag basis, contributed $29.8 million to investment income or 22 basis points to yield in excess of assumed rates of return used in our investment process. We invested $1.5 billion at a yield of 6.42%, including $1.3 billion of privately sourced assets at an expected return of 6.5% in the third quarter. Our allocation to privately sourced assets was 18.4% of invested assets as of quarter end, compared to 16.6% as of June 30. For the month of October, we invested $735 million at an average yield of 6.68%, reflecting a very high allocation to private assets, primarily residential real estate and private credit. As of September 30, the point-in-time yield on our investment portfolio was 4.22% compared to 4.05% on June 30, reflecting the benefit from the increase in floating rate indices and the further increase in our allocation to privately sourced assets, partly offset by higher expected expenses as we build out our investment platform. For the fourth quarter, we expect an additional benefit of roughly 15 basis points in yield, reflecting the increase in LIBOR on our $5.3 billion of floating rate assets. The aggregate cost of money for annuity liabilities was 1.75%, up from 1.69% in the second quarter. The cost of money in the third quarter reflected a near zero hedge gain compared to 2 basis points of hedging gains in the second quarter. The increase in the cost of money, excluding hedging gains, reflects a higher cost of options purchased in the third quarter of 2022 compared to the run-off of lower cost options purchased in the second quarter of 2021 and higher renewal rates on annual reset traditional fixed annuities. Cost of options in the third quarter of 2022 averaged 1.58% compared to 1.61% in the second quarter. Investment spread in the third quarter was 2.73% compared to 2.64% in the previous quarter. Excluding prepayment income and hedging gains, adjusted spread was 2.70% in the third quarter compared to 2.57% in the prior quarter, reflecting strong investment returns offset modestly by the increase in cost of money. By delivering on our investment returns, we expect to offset increased option costs. Excluding the effect of assumption revisions, deferred acquisition costs and deferred sales inducement amortization totaled $145 million compared to $133 million in the second quarter, reflecting an $11 million increase in expected amortization following the assumption changes I detailed earlier, and $8 million of additional expense due to actual higher surrenders than expected. Third quarter amortization was $7 million greater than new modeled expectations, primarily due to higher interest margin, lower than expected index credits and actual higher surrenders than expected, offset in part by lower than modeled option budget and crediting rates. For the fourth quarter, our modeled expectation for DAC and DSI amortization is $138 million before adjustments associated with actual experience in the quarter based on in-force policies as of September thirtieth. Excluding the effect of assumption revisions, the liability for guaranteed lifetime income benefit payments increased $11 million this quarter compared to the second quarter, reflecting an $8 million increase in the expected increase in the reserve following the third quarter assumption changes. An additional $10 million of expense associated with near zero index credits relative to model, partially offset by a $10 million decline in expense associated with actual to expected LIBR utilization, sorry, LIBR utilization, as well as other smaller variances. The third quarter increase in the liability for guaranteed lifetime income payments was $37 million more than modeled, due primarily to the near zero level of index credits, which increased the reserve by $23 million, and small variances in LIBR utilization, which added $6 million to expense above expectations. LIBR experience by election counts was actually better than expected in the quarter, but was more than offset by higher elections for younger attained ages and an increase in joint life LIBR elections, resulting in a higher present value of excess claims than modeled projections. For the fourth quarter, our modeled expectation for the increase in the liability for guaranteed lifetime income benefit payments is $72 million before adjustments associated with actual experience in the quarter based on in force policies as of September 30. Other operating costs and expenses were $59.6 million in the third quarter, basically flat with the second quarter. We continue to expect other operating costs and expenses to be in the $240 million range for the full year. Over the long term, we expect to manage expenses at a certain level of basis points of policyholder funds under management and administration. At September 30th and October 31st, cash and equivalents at the holding company were $319 million and $310 million, respectively. We have a robust excess capital position at the life company and currently expect to take an ordinary dividend of approximately $300 million from our life company before year-end 2022. Now I'll turn over the call to the operator to begin Q&A. Thank you. At this time, we will conduct a question-and-answer session. As a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. We ask that you limit yourself to one question and one follow-up, then jump back in the queue if you have additional questions. Please stand by while we compile the Q&A roster. Our first question comes from John Barnidge from Piper Sandler. Please go ahead. Thank you very much, for the opportunity. With the market highly competitive on the product side, are there distribution expansion options that can serve to provide growth opportunities? Hi, John. Good morning. The short answer is most definitely. Having been in this business for decades, we see a lot of those around the corner, and we'll be doing things like that going forward. My follow-up question, can you talk about the Brookfield relationship? There seems to be maybe a changed view of AEL 2.0 by certain board members, at least in some letters that have been filed. Thank you. No, we have a very solid relationship with Brookfield. I don't know what you're referring to, but specifically, they're appreciative of the strategy, supportive of the company, and if you have any questions, I would direct you to them directly to ask those questions. We are very happy about our relationship with Brookfield, including the reinsurance relationship, and we saw that grow by $500 million this quarter. Thanks, Anant. Best of luck. Thank you. One moment for our next question. Our next question comes from Erik Bass with Autonomous Research. Please go ahead. Hi. Thank you. First, I was hoping you can provide an update on the fundraising process for third-party sidecar capital. Given the level of sales you're generating, do you feel like you have enough new business to contribute to a sidecar and still sustain the current level of spread earnings? Hi. Yeah. The thing about sidecar and sales. Could you just say the question again there one second, Erik? Sure. I was just, I guess, first hoping for an update on just the fundraising process for a sidecar, which I think you'd indicated last call was sort of on track for 2023. Just thinking about with sales levels being lower, how much you could allocate to third-party capital and still kind of sustain enough new business volume to maintain your own kind of level of spread earnings. Sure. You know, the way we're sourcing assets, as I mentioned earlier, right now, with rates going higher and us being able to source assets in the 6% area for yields, we will be able to hit our double-digit IRR goals, which then support sidecars. The way I'm thinking about this and the team are thinking about this is we'll probably do one sidecar every year. We'll do one next year. AssetShield is what we've ring-fenced for our sidecar. We have a decent block in excess of $3 billion, and it'll grow around $1 billion a year. AssetShield will go into that first sidecar, which we do in 2023, hopefully in the first half of 2023, but timing of deal execution to be determined. That's got the economics where if you think of it, we'll probably end this year with around $9 billion of reinsured liabilities. We've done one reinsurance deal in the fourth quarter. We're not going to talk about it today. We'll disclose it in the 10-Q and talk about it for an earnings point of view, in the fourth quarter call. We're around $4.9 billion right now in reinsured liability. That'll grow to around $9 billion at the end of the year. We do the sidecar next year. There's plenty of origination. With our current sales volume, we can do 2 sidecars. We're really saying for 2025 sidecar, we're going to need to grow sales from current levels. Axel, want to add to that? I'm in complete agreement with you, Anant. That's the thought process. Okay, thank you. Realizing it sounds like we may have more information on some of this than you do at the moment, but it looks like BAMR is asking for you to tender its shares, I guess. Is there a contractual agreement with BAMR where they could require you to tender for all or a portion of its equity stake in AEL? No, not at this point in time. Okay, thank you. Thank you. One moment for our next question. I'll do a follow-on to Eric's question just to answer the question. In the case of BAMR, I would refer you back to our equity and investment agreement with them in 2020 in terms of the protections that are there. There was a five-year standstill with respect to any overtures towards the firm. They're a very important partner for the firm. We are committed to our reinsurance partnership and ongoing contractual obligations. In terms of Eric, your question, there are two tranches of BAMR's ownership in us, and the first tranche they can sell at the end of November this year, but the second tranche they cannot sell for two years since they entered into it, which was in January of 2022, therefore the end of 2024. Whatever you guys are referring to, once I have more, I can comment. I don't know what you're referring to, but I want you to have those facts because those are factual. Great. Thank you. One moment for our next question. Our next question comes from Tom Gallagher with Evercore. Please go ahead. Good morning. Anant, just a quick follow-up on that. The November tranche that BAMR can sell, is that 9.9% of the shares? I just want to make sure I'm thinking about that correctly. Thanks. That's correct. That is correct. Okay, thanks. I think it was exactly 9-something million shares to be exact as well. They cannot sell the other 6-something million shares for their total 16 and change. We can get you the numbers. They're publicly available. They would not be able to sell if they wanted to sell. We're having a hypothetical conversation here. To answer your question, yes. Okay, thanks. Then question on, if I look at the flows this quarter, you had net outflows of around $400 million-$500 million. Anant, I heard your point you made on pricing change in November. Should we expect that to shrink the level of outflows, maybe even inflect to inflows after you give effect to the change in product pricing, do you think this quarter? Just trying to get a sense for where you think the trend is likely to go here, because I know the market's gotten more competitive. Clearly. I'll start to let Axel jump in here. The market is definitely getting competitive. We will look for the, as I said in my comment, you know, rates to be sustained in this area. What if rates went all the way down? We've seen this market yo-yo many, many times. We're feeling good about the origination we have there. We're going to be top tier, top two tier in rates now. People come to us because we don't embarrass them. You know, we've got J.D. Power at number one. We've got distribution that's loyal to us. Bank distribution will continue to be a struggle because it's highly commoditized and rate-based, and if you're not the top two or three, you don't get much. If you were to rank like 15 companies, we'll be in top 5 with what we're doing. Distribution that wants to be with us, they'll be with us. I'll give you an analogy. People will laugh at this analogy, but we use it internally. If you were selling ice cream, if you looked at FIAs like ice cream, and you looked at, like, vanilla, chocolate, and strawberry or Neapolitan, our Gold Series was like Neapolitan, a combination of those three. Now we have this Shield series. You know, there's vanilla, there's chocolate, there's strawberry, but we're not a flavor of the month company. We have a level of sales this year, which I look at the bedrock of sales, and then we're going to grow from there into that $4 billion-$5 billion area and hopefully more over time. Got you. That's helpful. I guess my final question is just on ALM. To the extent that you continue to run with net outflows, can you talk about your sources of liquidity to meet those net outflows? How your cash balances have changed or if you have other parts of your general account that will not be trading at material losses that you'd be able to fund those outflows with? Hi, this is Jim Hamalainen, and you know, when we do our asset allocation and we do our ALM, you know, we're always looking at updating assumptions and, you know, in this case, looking at updated assumptions for liabilities. That's factored into everything that we do. When we think about liquidity, it's a global view of liquidity. While we're buying private assets that in a lot of cases have less liquidity, we certainly are very conscious of our overall liquidity. We have multiple sources of liquidity, you know, within the portfolio and beyond the traditional securities that we hold, you know, with our membership in the FHLB, for example, where we have significant access to a significant amount of funding from them. Okay, thanks. Thank you. One moment for our next question. Our next question comes from Ryan Krueger with KBW. Please go ahead. Hi. Thanks. Good morning. I guess I had one more question on BAMR, and I understand this is a bit of an unusual situation, but in the letter that they released publicly, they cite a recent event that there has been a fundamental change in the strategic direction of the company, and that change represents a material departure from the AEL 2.0 strategy. Nothing I guess I've heard seems to suggest much of a change in your strategy. I guess I just wanted to give you an opportunity to address that 'cause I can't figure out what they might be referring to. Hi, Ryan. Good morning. First of all, thank you for summarizing what you guys know and I don't know, so I appreciate that, and I'll respond to it now. There's no fundamental change in AEL 2.0 strategy. Our strategy is about our flywheel. It's about the assets we source through proprietary relationships, whether it's Adams Street, whether it's Pretium, whether it's others. As part of continuing to execute that strategy, and then we do reinsurance deals. I'm happy to inform you guys that as part of executing that strategy, in September, AEL made an equity investment in a new asset manager, founded and led by Josh Harris, the former co-founder of Apollo, called 26North. AEL hopes to source future assets from this venture, 26North Partners, that is, got a lot of talent flocking to it, a great pedigree in terms of Mr. Harris building businesses over time and being one of the foremost private equity investors in this generation. That is a modest investment by AEL, similar to what we did with Pretium Partners. We haven't done any IMAs of size yet, therefore, frankly, nothing to talk about. We are going to evaluate doing some IMAs and growing that, hopefully over time. AEL's interest in this entity will grow, and therefore, our fee-based earnings will grow. We think this is a. You know, we can't build an asset manager from scratch ourselves. Partnering with Josh and his team at 26North and talent there is a further validation of AEL being the marquee insurance company, understanding what ALM is, what SAA is, and how we drive AEL 2.0. In addition, after the quarter, effective October 1, we closed a reinsurance deal with a firm and a reinsurance company based out of Bermuda, sponsored by 26North and Mr. Harris, plus Agam. You may recall we had explored a transaction called Värde-Agam 2 years ago, and then we abandoned those plans for capital release. We actually have executed this. It's a fourth-quarter transaction. We will disclose both of these items in the 10-Q, so you can read further about it. I'm doing this extemporaneously so that you have the information. There is really no financial impact on 2023 earnings from it, but we will free up capital in excess of $250 million. Therefore, Axel's comments that we intend to take a $300 million dividend later this year out of the life company reflects that. We are now well on the path of having sustainable capital return through our AEL 2.0 strategy, through generation of fee-like earnings to the tune of $250-$300 million a year. You know, it's not about shrinking us up to greatness. This is about growing this firm on this basis. I cannot comment on Mr. Shah's letter because I haven't frankly read it in its entirety, in its context, but I can definitely give you an update of the company and nothing has changed, and I hope you have the same view as we have on this transaction, that this will help AEL preserve optionality and grow. That was a mouthful, so I'll stop. No, I appreciate that. That's really helpful, and that may explain maybe what caused this. Just, can you give any perspective? Is this an ongoing flow-through deal, or is this just an in-force block that you did? We did an in-force block, which is our 2008 and 2010 FIA, which was $4.3 billion of GAAP reserves. We have a positive ceding commission on that, so it will grow our, you know, ROA-able earnings stream from there. It's a very good trade for us. It's a good trade for them. It is at a lower cost of capital than ours, so we appreciate that. It puts them into the business. Again, it's exactly what we were looking to with Värde. There is an option for AEL to do up to $525 million of MYGA with them at a fixed ceding commission that we've agreed to. Again, it's an option, and we're not planning on any of it this year, but it again opens up another pipeline for us to originate and then reinsure. It has the protections of reinsurance structure that we like. Our regulator has seen us do before, very similar to what we did, frankly, with BAMR, but this is in Bermuda. We really like the Bermuda framework. We've got our own company there. We will do our sidecar most likely there, and then you've got this company there. More in the 10-Q on the reinsurance structure. It's 75% funds withheld, 25% coinsurance. That'll be what the MYGA up to $525 million will be. It'll be 100% ceded if we do MYGA with that. Thanks, Anant. Thank you. One moment for our next question. Our next question comes from Daniel Bergman with Jefferies. Please go ahead. Thanks. Good morning. Figured I'd start with something aside from Brookfield. Maybe just on surrenders and withdrawals. It looked like there was a little bit of a step up in the quarter relative to where that had been running. I wanted to see if there's any more color you can give on, you know, what you're seeing there and whether you expect this to continue. You know, for example, is this more just normal quarterly volatility or maybe indicative of some upward pressure on surrenders from the higher interest rate environment? Yep. Thanks, Dan. This is Axel. We saw, if you look at our past few quarters, you know, basically we saw about $1 billion of outflows every quarter, stepped up to $1.1 billion this quarter. A little bit of a tick up. If I look at that extra $100 million, it's basically a mix of no-fee LIBR policies as well as some of the accumulation FIAs, kind of, you know, about evenly split. I think it's too early to start drawing trends from there, but it's obviously something we're going to keep a close eye on and be managing through. No need for us at this point to be trending this. Got it. That's really helpful. Thanks. Then maybe just on, you know, the returns on partnerships and mark-to-market assets remain, you know, quite strong in the quarter despite the tough, you know, equity market backdrop. Sounded like residential real estate and the rental market are the big drivers of that strength. Just following up on your prepared remarks, I wanted to see if there's a little more color you can give on what you're seeing and kind of the outlook going forward. I mean, with you know, mortgage rates spiking and talk of a potential recession next year, you know, how are you thinking about the risk of these investments, you know, turning unfavorable as we move through 2023? Sure. This is Jim again. You know, as we look at residential real estate investments, for example, we think long-term trends, you know, remain long-term demand remains solid. While there certainly already has been some pricing changes in the housing market. We've seen prices dropping in select across the markets, but really more in some markets than others. You know, we still view that the long-term value is there, and we think that they are good investments. At the end of the day, there is a lack of supply of housing stock in the U.S. For periods of time, you know, certainly. We've seen some articles out there, people are moving back in with their parents or moving in with roommates. Over time, the number of household formations continues to grow. If the housing stock is not growing with it, which it has not been, demand will continue to be there. Certainly, we won't see the types of a peak like we saw in the housing market, you know, earlier this year. We don't expect to return to anything like that. We expect real estate to generate very good long-term returns. Got it. Thanks so much. Thank you. One moment for our next question. Our next question comes from Pablo Singzon with JP Morgan. Please go ahead. Hi, good morning. First question I have is on buybacks. They're a little bit lighter this quarter compared to the first half of this year. I believe, earlier in 2022, you had signaled that you intended about $700 million for the year, right? If that number is correct, does imply a pickup from what you did in the third quarter. Am I thinking about the trajectory correctly? Hi, Pablo. This is Axel. You're correct. We started the year with the target amount. You know, look, in terms of stock buyback, we've been in the markets all year. But at the same time, we've been opportunistic in terms of the trading levels relative to price points, where we're willing to buy at what volumes. So I think we want to continue to do that so that we can not only return capital to shareholders, but doing it in such a way that's good for shareholders. Thinking about what is the price that we're, you know, we're willing to buy. I think we'll continue to do that, and it may mean that we continue to execute the buyback for this year into the early part of next year. Understood. Then the second question I had was about the new venture at 26 North that Anant, you had talked about. So I guess just given that transaction, it seems like you'll free enough capital to cover, you know, at least another year of capital deployment, if I heard you correctly. The question I had though was how much of the earnings that you're generating into the book now will you keep from the trade, right? I guess longer term, when do you expect to fund buybacks from ongoing earnings as opposed to more, you know, in force or one-off type deals? Thanks. Why don't I start on the latter part of that question, Axel can get it on the former part. Look, I think it's one very simple way to think about this is so we have almost $5 billion right now, which is earning 100 basis points of fees on it. That's reinsured at the end of this quarter. Of this is in the Brookfield Reinsurance that we've done. You know, there's 30 basis points of ALM fees, and then there's a fee on that which comes in as over 6-7 years. That's $50 million right there, okay? The last call I had said about, you know, around getting at the end of this year, getting to around a run rate of $100 million and growing from there in a question Erik Bass asked me in the last call, last earnings call. The way I get there is because when I look at what we're getting right now and the seed we'll get off the one we have out of this transaction will be well in excess of $100 million. How are we gonna fund buybacks on a sustained basis through not doing reinsurance deals that free up capital, which frankly is meant to invest back in growing, in funding C1 capital for high investment income on the spread business? It is by getting 100 basis points between ALM fees and our ceding commission every year going up by $3 billion, $4 billion, $5 billion on that number, right. Even if you get 100 basis points on GAAP on some of these deals, like our sidecar deal, what I expect us to get is I am not gonna give away pricing, but to get multiples of that number as the upfront seed. More than half of our buyback will come from these capital, these ROA-like liability ceding commissions and ALM fees that we get. From our spread earnings, 'cause we don't need more capital really to grow spread earnings at a conversion ratio for traditional spread company. We're not gonna shrink ourself to greatness, if I may use that term. We are going to, starting in 2024, after we do our first sidecar in 2023, just be able to fund it through spread earnings that we don't need for growth and the fees that were coming off these balances that grow. That's a mouthful. Pablo, does that help before I get to Axel? Yep, it does. Thanks, Anant. Yeah, no, I mean, building on what Anant said, that's really the buildup of that sustainable capital return is building the fee-related earnings over time, like Anant said, through the existing relationships we have today, plus adding a sidecar in 2023, adding a sidecar in 2024. Remembering that, like Anant said, the cash conversion ratio on those types of earnings is really greater than one, right? Because of the way that the GAAP accounting works. We have to amortize the cost of reinsurance over time, and it effectively, the cash earnings are in fact more than one time, 1.5, sometimes 2x, the GAAP earning signature of those deals. Layering on those transactions over time as well as the core spread earnings where the margin is expanding through the increased allocation to private assets is what gets us there. Got it. Thank you. Thank you. I'm showing no further questions at this time. I'd now like to turn it back to Julie Heidemann for closing remarks. Thank you for your interest in American Equity and for participating in today's call. Should you have any follow-up questions, please feel free to contact us. Thank you for your participation in today's conference. This concludes the program. You may now disconnect.