Earnings call transcript Q2 2023

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Operator

Good morning, everybody, and welcome to Federated Hermes, Inc. Q2 2023 Analyst Call and Webcast. [Operator Instructions] Please note, this conference is being recorded.

I will now turn the conference over to your host, Raymond Hanley, President of Federated Investors Management Company. Raymond, over to you.

Raymond Hanley

welcome. and morning, Good us joining today. for Thanks will Leading President Donahue, and Chris Federated today's Hermes; Officer. call of Financial and CEO Chief be Tom Donahue, is Chief Investment for Saker for the Hermes us Q&A Officer and the Markets. who Limited; our joining Federated CEO Cunningham, And Debbie Money of the Nusseibeh, are

disclosures forward-looking review we implied results our materially want different as in statements. the and results to the results note Chris? assurance today's call, given update assumes forward-looking statements, actual of be During that any such and no may Please statements. by risk may make No these be filings. we Federated Hermes' Hermes SEC to Federated than duty can future to

Chris Donahue

and you, all. Thank Ray, good morning

comment financial I on our will Hermes Tom review Federated results. business performance, will and

at first equities. Looking

down to net market gains due largely $XXX $XXX partially were million. $XXX billion million offset to million, $XX of by of redemptions Assets about

sales ex-Japan, Growth equity leaders. saw so, XX strategies, positive Mid-Cap MDT in growth, Asia net including and large-cap Even QX we international MDT's

Now in of million $XXX the to QX net $XXX compared of domestic redemptions dividend net sales first strategic million quarter. had the strategy value

and we from stream about have strategy high this outcome-driven of is As benchmark-agnostic. a seeks dividend before, and income high-quality It companies. is talked rising

of and to a years to S&P large in that its it ranked loss 'XX, the has average performance. in X.X%. however, the and assigned of of Year-to-date, point, Over percentile XX% ended To assigned thereby compared June ranked the it compared category of has XXXX the over last of the of make return in negative XXth the through its value cap gain, it this X.X% the for XX Morningstar category. XX.X% XX, returned a June XXX X.X% S&P XXXX on top strategy X% from returned

dividends the XXX technology yielding or XX% they group of This year, no a led dividend the low yield. either objectives, this have to-date. yielding strategy's as you are quintile of market, quintile know, S&P as outside been are that stocks pay The nearly companies top in underperforming small has by by the a largely of bottom

would and high-yielding cheaper into Now investors rotate benefit defensive this strategy back stocks.

equity at top the to for peers our category. quarter, quartile three equity XX% their years. data end trailing the using overall the and Morningstar our At of Looking were second peers XX% beating funds compared the in performance of of and were

of For the weeks first QX, $XXX SMAs combined three funds redemptions had equity of and net million.

turning income. to fixed Now

million, QX quarter slightly entity. in of sales $XX.X flows driven large billion. $XXX income regular $XXX cash institutional to separate net million account net and Fixed Assets while by the were from public SMAs a decreased second fixed of had income funds redemptions

Bond million funds, and redemptions $XXX $X.X prior of income about the Core quarter. Return down flagship were $XXX Ultrashort fixed Core million had $X redemptions QX Within net Plus while other our Fund about Plus of billion in QX Ultrashort The of from billion. funds. net Total the sales in three added strategies SMA sales net strategy, occurred net

at here sales bond total and note, Ultrashort second fund SDG positive High XX of and a are billion We including, $X.X income mid-July. return Engagement net total with funds Fund. as quarter Just course, AUM the Yield had about fixed in

top peers our category. in second the Morningstar quarter trailing fixed and the performance. of years, end three were for quartile Regarding XX% funds the XX% their income of At of and using beating data were

fixed three million. funds first weeks SMAs of the net and For of sales income positive had $XX QX,

partially million redemptions increased was in assets alternative to and net offset to by prior reaching $XXX private markets QX category, quarter, distributions. the due compared increase impact, $XX.X billion. the In The FX by

from across our of as as co-investments the existing $XXX having X, PEC commitments, investors co-investments of track June, in XX-year $X.X and Federated GPE reaching record billion a Commitments South fund Korea. in global well PEC committed of of our close of has final private making 'XX. exceeded from investors XXX $XXX new came Europe Hermes million co-invest as March the had Series fifth which We vintage million equity target.

We third equity vintage of market of the private to X, our continue series Horizon Horizon funds.

Horizon X of the commitments through little over $X has billion second a quarter.

solutions also with and vintage in of We of Innovation are debt fund real which our the the Private Hermes the the second Fund, vintage Innovation of the first our Equity our estate vintage fund. market nature-based is first Fund,

income, credit, quarter markets. totaled Now corporates, fixed with in active in in yet fund, we and expected short are This high separate billion. to and cash, diversified $X.X These about core funds wins plus. $X third net income both private Fixed yield institutional accounts. billion began the additions includes equity the across mandates and net wins

Approximately market credit. emerging equity About markets, $X.X return billion MDT Mid-Cap strategies, This global wins of into Global is biodiversity, $X.X expected direct total expected to total into lending including wins Growth net Equity. to strategies. come come net is and equity, private includes and absolute private of billion

Moving We highs billion reached money of total market of fund assets money and to $XXX $XXX for Money assets billion. Markets. record market

managing yields, from in presented ceiling compared the for favorable to as financial cash significantly levels second to continue elevated Despite debt markets. class, market and market The quarter the liquidity strategies an yields prices challenge, a challenging favorable market bank money deposits. environment higher impacted as system benefit asset short-term money this for strategies debt conditions

expect be and peak, to markets As short-term will interest market favorable rates for both rates. strategies deposit market direct conditions compared bank money we

challenged product funds crisis debt corporate regular intermediaries. money good period. tax we flows in of yields the June activity saw were quarter, flows from second security and the aforementioned the to direct at products the geared financial Looking customers by in Institutional retail

funds. recently know, new rules for you market as money SEC, adopted the Now

to pleased were occur. and yields these that a pricing included to that and study mechanism assess their continue reverse We distribution included swing that use was rules as ability impact. an possibility We were to was the not to to a remote option negative see

and redemption and also of periods liquidity liquidity We an created recommendation to was investors between from believe and with the thresholds which using as much pleased available. manager the agreed prevented we asset our weekly market liquidity SEC the were fees, stress redeem remove in for as that sooner link to incentive gates temporary

of to subject redemption fund a challenge institutional and fees and presents certain inclusion funds for in conditions advisers mandatory investors. prime muni The

have products approximately and private $XX market believe fund billion including in We we our funds in assets we prime and third-party muni alternative institutional offer, money prime shift government funds. that to institutional could that

of prime institutional may minimis muni so-called an impact on that that that strip occur securities of X% already have de asset fluctuating carve-out values have selling rare noting the on when the we trigger. is funds worth for It's or based a there and net and days redemption exception a a hypothetical

this We late when will to new topic. over believe rules investors least be next the will continue the take months We muni coming clients talking the with on that year, effect. use at institutional into prime these our institutional funds, and

market the Our funds, second end down money mutual quarter. market was quarter of sub-advised estimate at of the the from share, first the end fund including X.X% of X.X% at

multi-asset. mutual alternative in Now in market few including looking private a billion. $XXX asset fixed were in income, billion assets $X in at were $XXX $XX recent $XX markets, assets fund in totals as billion $XXX approximately $XX Money and markets billion billion equities, billion managed days money of billion, ago,

you, Thank on financials.

Tom Donahue

Thank you, Chris.

one transactions combined of QX of third in transactions a The included loss that private net and by two a equity investment a results results a As for of party tax a one described of restructuring in $XXX,XXX. release, shareholder sale impacted include portion of of of infrastructure press funds. the their our funds a our to

We continue funds. both manage to

carried quarter due mainly carried revenue Total vehicles consolidated revenue for prior carried from QX performance was interest mainly which compensation million the million from from interest of $XX.X that to increased $XX fees, is increase an $XX expense. million of offset by and interest in

fees prior fees Retained QX by $XX.X carried X% All higher equity in and to million $X.X due revenue Total assets, million. million the million. bringing increased from $XX.X revenue interest carried and other partially and day were mainly million revenue the $X.X reducing revenue offset by additional performance quarter. or of in by $XX.X interest performance by $XX.X an of assets, average money average lower quarter, market increased in million bringing

QX the and the other expense restructuring $X.X other million $XX.X million expense. vehicles of carried from to by from the recorded the infrastructure consolidated All operating due expenses interest of quarter million $XX.X $X to due prior compensation million mainly in from expenses increased X%. increased fund or

in related The and increase consolidated is and The service The incentive million $XX consulting and QX professional increase increase in offset from of and legal vehicle $X.X compensation quarter of mainly certain timing partially $XX.X by compensation severance advertising mainly the conference from spending. to due in expense to million the $X.X the from higher in expense. million was carry fees. advertising compensation due QX lower included and promotional fees interest prior in million

The the future interest, was rate The not effective tax to deductible tax impacted the infrastructure this the rate receive was XX.X% for the purposes. quarter. QX and restructuring rights purchase by which expenses carried were purchase fund, included related of for

$XXX a this cash rate investments to As result, of XXXX. was million, available effective quarter XX% expected $XXX of to rate QX, compared end were higher million us. for which to tax our and the was At our of about XX%

please? to like would we questions, call for open the up Jenny, now

Operator

you. [Operator Instructions] Thank

your line Daniel Jefferies. Your coming Daniel, is first from question Fannon of is live.

Daniel Fannon

morning. Good Thanks.

as rates hearing money just to want what stabilize market those contrast about peak, to you flows to wanted that that and up see picking also occurs. understand to I or But income just when So broadly pick fixed comments with flows that flows your start also just up. expect we're

investors towards as bond to the rate lower potentially look are of that like we market or So - to we and think trend how and allocations balance what going funds rates dynamic. are our peak do going money you get as more between funds

Chris Donahue

on market portion, money Debbie the comment portion. fund I'll the I'll add Daniel, and let on bond

a it, total the has over bucket Core billion have very and great long term. is So franchise, it the our a $XX story to Plus in return over franchise, good bond

at a market, winning are And we almost is a we're And the where matter feeling big people little is core how that position and allocation, mandates what is core in that allocation. no are so is the on marketplace. than income fixed looking a therefore, as different going a

space. we're winning in so that And

those they some to If to FA, along somewhat lines bore, you've are full though with even performance. market seen changes market into you reticent the the talk go

quite Core record. And sanguine are the this kind so Plus a core position has about fund that they of in

the together comment back And I'll money let then market draw I'll and on portion, after comments. her them Debbie

Debbie Cunningham

Thanks, Chris.

paying now that's money were the rates for rate the the market seen market. market funds retail compared a of equation, of zero far has more from deposit side because So they side have environment, And where the we so of the much return. market lot growth are attractive much to that money rate the simply come of from bank of

they buying able For to the institutional in specifically, so generally buyers, direct have direct commercial however, buying CDs. ability markets be to paper, direct be

securities start in come funds has the they as have average rate maybe lag, order go of up Money the market funds operate when actually longer maturities investor case. at even a for stay or purchasing therefore, XX the occurs the such been market increased, weighted they higher Once institutional into that other plateau where as And direct time. upon this peak the days a markets to And down higher they those lag pick then, what more so period to yield quickly. the our more for opposite market and the yield, with even in market those side, depending that are. to XX

when see up would and while institutional maintained will flows institutional the that pick at we markets generally, be So point. that's retail

off two go as retail sources. very it marginally, from even The the And once comes is attractive plateau deposits. zero, different then coming comes side. side, start institutional as to it rates from versus So and and bank down money

management fixed are the include that back even these markets So cash was It income flows doesn't to and that's for what or the Chris may their side those managers flows. make of markets talking - generally matter. about, that the way equity ultimately longer cash

you. back to Chris,

Chris Donahue

Thanks. Okay.

and almost it's willing are filling decisions to product core And of FAs XX-some so that periods, in does on the time, if and downside competitors of at look alpha percent very out a the product. addition The is to the beats duration XX position, three the on bench. year those independent like rolling really over And you going what's its on upside. the lengthen this about good returns the here a fund job capturing

bond And And it's others why fund so into product. doing solid like that. seeing category. a these total other return are managers consolidating very the And things strong and flows you're that's

Daniel Fannon

hoping was interest helpful. Thank quarter. clarify That's within And the I Okay. dynamics carried you. to the some then of the in

the restructuring I think of infrastructure the fund. mentioned you

that just something if and else to specifically legal of - and was normalized costs helpful. impact you kind the I believe quarter to have the of well? partly and But looking as would sure what carried understanding we're there missed then I it. was about make want But the - could happened is what the I might exiting the why kind second believe expense elevated be levels just So interest at I comp. talk

Tom Donahue

Yes.

Okay, why we about under but release of kind in press Dan. summary, That's it. that things specific put talk just financial to the

the else sell So somebody importantly, some a has to of we this transaction, time position private they their equity and which position complete a are investor for still long the product, looking able it. exit we we Horizon to on large their managing have and long-term to and were worked was

it else. So just we're it's managing for somebody

carry That of it, of selling ink it that they being the from is the it, which which compensation. some is we some which we and managers gains get carrier why get triggered of by got the triggered it, the which the

have positive to a contribution So been by that itself, that standalone would earnings.

update infrastructure So better existing it at looked we to to and in into of business, kind a it was structure transfer it and to we in that the transaction the it future second satisfied realized the investors to our grow more where needed

why that why clawback recognize - from clawback. that we and there Once did were able carried what reason we it past was the a recognize able - were didn't triggered recognized the that And before because it was recognize. therefore, interest The we restructured the to it it, to reason was we we it. ends

the out was value a fair it's And an got to was in people the the it interest, carried as that up get comp expense. what for not employees had the cherry we paid went market the take that we to line. shows expense to do way, and By also who had other and though and a the even of

portfolio and those too. that things, both Now we manage to continue

I make for those businesses. think follow-up Saker And important he it's to comments wants on any if

Saker Nusseibeh

you. Thank Sure.

somebody term. there about because two market it of for you when success also you can long at triggers private that you term, find the liquidity want sure can help they One, first make what is and to tactically have about that's actually need want if of transaction, and the ensure else, they if for did. So this. of the investor, or things we the you some in-depth carry that a think stage, we a find them for that long And the both some they us managers. And to then a realization our

clients is that And of the The it different we management adapt so kept sense second to fund the to themselves one the it. restructure they do. wanted to that in can we want what us the again,

So point the management the control have that both. first of we key of is

gives But indication. of averages through or generated gives and lumpy which over a the see over simply forecast private it the at can predict, this numbers. numbers time, the just we it. private of lot release do that's it's payments a you an carry are comes part revenue something the is happen there's And This how that an actually past but indication how work, as these that do integral strategies it press markets within one like notes our can you an and which markets, the second not look is neither you time. we The of is is

The we parts to private managed have established part the markets on. all expectations strong posed same our direct equities. in And It's private and of is property. in why that's reputation record revenue track incredibly of above outstanding. and an Now we in so

and in So it's is comes private clients managers, many realizing it some the us which markets which the to then actually bases the a and keeping expanding some house. with of carry, combination is of - which of of typical ways to our client ink, goes the

its of us if for stickiness, gives is interest and markets its how you generate for as clients. within insight, you it business the it like, attractive how So private because this longevity well as an that and of you works carrier's our

Tom Donahue

I the have all give was we why things, dollars, which wouldn't put only too $XXX,XXX impacted I is these take that that's earnings have you that transactions that net-net-net these you all when put And all after-tax complicated of are Dan, in wanted indication and on last So to we these out. exactly. of kind much comment we about $XXX,XXX millions to an the in that understand impact figure an

Daniel Fannon

Thank you. Okay.

Operator

Thank you.

Patrick, from is coming Davitt next is question Your Research. Patrick line live. Autonomous of your

Patrick Davitt

everyone. cuts think month, but reported on Hi. earlier press the I in misrepresented impact. fee morning, The fund some Good money the

reported So could And color immediate you the are the reasoning you to then more new you. from on the frame those broadly, any Thank changes exactly impact earnings model any framework? what changes? for And the made?

Raymond Hanley

Yes, reduction the of indicated, did on But group because no fund you funds. advisory advisory to in fee beginning board revenue the money May, a approved a Ray. impact investment our there's our we in had long-standing already Patrick, it's We fees as waivers. of

been were was that not or may collecting. that. such this So It have reported we indicated as revenue

beginning addition, when other that the our and XX at and some when things and funds also of three you new options treasury have to at on look to additional In launched minimum investments product of did features. we share products looking classes expenses consistency funds. government our the give July, And treasury some in and clients prime compared we like

waivers. creating basis of certain net classes, priced number new As a consequences share these of points these XX at

line fee with funds are competition share of category. kind was already in that the new and option where a some in previously the of bigger what available. with government class, which on giving - a rate We on represent net the does again, side, that's than us consistency. line that pricing had effective so And moving is And lower

the high So at a changes those are level.

Debbie, add want anything I that? don't know to you if to

Debbie Cunningham

Yes.

I the classes kind to of shift this really think those assets be just that expect point. take any to in a it modest expect at be we place that in impactful products and product within don't share might we between

Raymond Hanley

will occurs intention, expectation regardless shifting to is be we - when that any revenue undertake this, of that the enhancing. of And of like our changes if and or they when our course, is

Patrick Davitt

my as cash And Thanks. quarter the it. call the I lot tone fairly Got you're a on repurchase maybe last in second more than and nice did a balance follow-up, suggested. building would think have your

be price should So as leaning think more now the that for repurchases we your quarter? is than half it and our we second much lower into last about was models now

Tom Donahue

Yes, Patrick, Tom. it's

the tick down Russell. we Russell the So in got --we to index the had in

regulation going weren't was there. happen to and coming, knew we're And money the there so happen we And what we sure wanted be was going and sure was what market exactly to to also prepared. then that

And into behind future, so And thought period. We appropriate. that shares the that is lower during we there looking did was than price us. the was buy Russell

thing based now we market process. opportunity. underpriced the not shares as been. buying And as a it We on our is is that we that thought so buy stock will So have review money bad could that think as and

Patrick Davitt

Thank you.

Operator

you Thank much. very

coming Brown of next Your is Mike your KBW. Mike, line is from live. question

Mike Brown

Good morning, Great. everyone.

this dynamic your the in more? stock. a there. little the just and requirements on dynamic did resulting pressure the Why Can of We bit on your index? you to of part stay Russell about with meet You not is of the inbounds number touched given strategy. investment removal a the just kind receive And that I dynamic the on touch guess technical governance

Tom Donahue

can we dynamics up picked to know the answer and index I'll hard last the the came understand, our up that part, at the to So saw first The are but looked before question. volume exactly, Chris our price date, deal and and down leading it. volume

people happen down, - based hand, kept you selling price portfolios in people so the look month was change advance their was you going Russell at volume preparing what addressing can betting money a pick. or down, and If whether down, it or before went went that up, the business, and whether they was on market of thought in the going or to the

was I both. think probably it

to XX underperformed. five day, market. we we volume the After few of kind days a you had kind And or then that forget the I the before, something the after day changed. roughly stock shares outperformed million Russell And of the days actually, big on relative

was maybe the We're So to share that to that mirror Realty Index but historical the adjusting think now thought levels. I the trading funds. people the buying rearview our - down portfolios their have not it's was opportunity would because more tied And were participated. index and we in who settled to seems actually

Chris Donahue

Federated Inc. changing an as didn't So with order index. to Hermes, have mean be index an doesn't not we people to join index do non-index the get index strategy to in to strike decide that their The decide us way the to for

Aetna. have an We went owned into we in was had way when back were bought It structure. back this same structure all public. in 'XXs we by the back we when when XXs the intervening ourselves the went to 'XX, the we But going time

to conjunction side, worked And very at money it's the manage as it's it's with funds, the for institutional who conclusion, that we and our is on that in us clear been well the managing in And charge And lunch having who are and not money. to, investment therefore, able with of focus on enterprise the we're the is whom. we growth management about performance and worried looking who's

can because the do I take we buying the generate would opportunities incongruities these also that add stock. as cash underlying flow, for marketplace we in

structure we where our So are are. we happy with

Mike Brown

are - you seeing Thank follow-up, there. growth take allocation just - differently. opportunities And you the little a bit a capital you front? on about just that Okay. And I if as for question approach thinking the opportunities of any then thoughts just Hermes of on Federated take could the evolution you your are would some next M&A how think strategic of fit And you kind the that here? best

Tom Donahue

Tom. It's Okay.

be to real going about acquisition process. and we've London and going It's an estate the have to long, skills bring to We probably talked looking over got - in That's a before, require U.S., development U.S. get that here the ground area. expertise will in we in to the in on that boots and the be long have the we've trying

to us to It a long of there, fit Hermes. us. time It And us acquisition expect so take to sense be thing. to things too. culturally going has makes all that's us find long and with long-term find the that I would kind time That in took a that it it's to a has something for would the biggest thing.

have or needs or in don't We growth quant value.

So of those money things be money in then, out, more would all of a be roll-up to probably happen. if type business. we And that fund expect someone highly player. the interested the We're wants course, in, are to And fund business. in

Mike Brown

Okay. Appreciate the thoughts. Great.

Operator

Thank you very much.

Bedell from line Brian, Your from coming is Deutsche question is Bank. live. next your Brian

Brian Bedell

folks. Great. questions. taking Thanks. Thanks morning, Good for my

side on perspective of fund of going - First which to the debt know sort from chasing yield XX% weekly subset across on I you competitive money business? retail asset money SEC, the sort would and I change the to you on of some that do just with near I XX% and flows of to think, XX% market particularly maybe how see - and funds that, get for you? to class. the money manage marketplace then, conservatively higher obviously guess, in proposal, tend might question side where think liquidity but the side, I the yielding in that a you connected in the the dynamic the you XX% sort that, term? Sometimes money relatively your in And engage on of intermediate How chasing proposals combo see typically rules, yields competitive impact the overnight from the on don't you and

Chris Donahue

Debbie?

Debbie Cunningham

Sure, I take that. can

So which assets be going required funds that, be that and XX% rules. in from role in in the the and dailies the in to new required weekly will XX% liquid The only impact in XX% XX% funds. would current prime overnight will that are

kind asset exempt of requirements. any First municipal of liquid are funds from all, daily the

weekly only assets impact them. it's liquid So that

a both or for in operate weekly. those requirements and a from government standpoint, And municipal and they excess XX% well either of XX% dailies

And and that we part, to dates it's and will and XX and XX never especially funds the XX, XX. our probably the that had but the rather So tended really closer for XX of XX for the be most manage prime a XX something consequence and fees, was negative to impacted. funds potential with since

XX So mostly impact compared. XX competitive XX be It they're institutional which able prime in and should government is where prime point going their they a XX basis impactful. the particular maintain will is spread have still to those but and over and to sector, products, retail

continues paying of in bank to the products banks From point speaking, are heap a market, bank products. of market, generally kind a their deposit a top of competitive alternatives standpoint what yields as lag are standpoint perspective what the earning and for our the administered in cash versus market this for rate at retail outside are are, what deposit industry rate. our an are from be retail, the a the especially from management of Mostly funds would highest and through that passing the market, the competitor those

institutional direct the down the and will market plateau we On the as yields that for point. become also comparison to start other the again, the as to go very institutional peak customers attractive side, at side,

Brian Bedell

Maybe as chase your reversion That's selling rally. performance when the a peer and some strategic we're Or and advisers do my color buy mean And - on that advisers value this perspective? described you're outperforming? do Chris, this, the group is buying resonating now performance just fund. you force Is product This obviously, from follow-up this, you it's typically the at that mega to. it this least probably will be opportunity on more - cap this in sales typical and it's really a tech great actually it is versus good color. on classic

Chris Donahue

the at in, number the the Last experience this look that money that it goes changes. out it's terms the advisers performance number that year, the in before, money it's fund, the how we when been product. came to was that need how of when one exact presented you it's and had when because in money the one, Well, is comes long there

However, a in was in. the dividend story money because that went stays growth it

the And FAs is on the the over written team the And one so with speak. we books have concept. subjects, the long us as prefer new coming these haul and our knitting PM what sticking up with and a with staying

of efficacy of the to In investing, performance notwithstanding. recent terms contrary, of the this type

what at So money takes. But number over that because of And the and remain overall mentioned the goes one, it the very, core number the margin, the fundholders I when why group when one very when comes return up. steady. of X.X% it backs because last years. out that's those in, it's that's XX

Raymond Hanley

And assets, and to of that stocks as have same small ETFs mention option. added late last the $XX that two platforms we driving an having added growth-oriented returns. Brian, it And add, within year, precisely being I'd we're we've is It's in strategy to launched continue but would platforms growth alternative opportunities it's an and million also around of the just experience. because kind added exposed I to group the had

that continue And have standpoint, they to to. an to want it's access adviser so from a strategy

Chris Donahue

in gross there fund forget, had when don't worth million redemptions. be, the sales would we comment are that that other of quarter written one $XXX net near And in

alive it is and Maybe out want for come product is thing product mentioned, best viable Ray our the look a namely the the long by whole the time to So a just And it's I new commitment long-term term. with ETF. and well. to at what the demonstrated

Brian Bedell

perspective. Thank you. That's great

Operator

you very Thank much.

from coming live. Dunn Your from line John, your John Evercore next question is ISI. is

John Dunn

and it the to maybe you smaller of to the players of it's work rates more Good XX% more or you. certainty the maybe for morning. guys that with XX% someone Can on episodic? doesn't some do and with the environment, Maybe theme Thank more joining money How look regulation. with roll-ups. at closer just confidence in us around the way, range. Does it frame up give that bigger plateau continuing higher market

Chris Donahue

and controls depends of on the the how It the there in money moment redemption. at got who money

regular really who top assets. how listed compete depends market The that big XX XX players. into for And So assets, XX, XX only are the have money there fits your maybe ones the the fund on are business. all the it all top

force avalanche time after And But we're periodically, was that their money one. should managers we’ve set they regulation. to no have market I Tom it. that this. we as expect loving fund to to for. the warm all to, what doing of on CEOs There the episodic. out mind So what business SEC the has calls pointed it's on CFOs, a decide come get out an the of decide And looking and be and last goes around out, in change and home sales this go-round avalanche players of that's don't a

So believe to a I be don't catalyst an it avalanche. will

John Dunn

strategic value your of more can that strategies talk But some to And can redemptions you from in outside Got those equity dividend. other about talked you. you soak think up that, about then pickup demand little a you of kind SPD? see of

Chris Donahue

picking their up and mid-cap large the and the and Well, excellent. growth excellent. two is fund large of been business very both regular offerings The growth institutional business cap have MDT

you is Leaders performance the look another at that inside If very across time and a distribution. has that's the frames Fund, International good excellent one retail the offering

If also mandates. some outstanding skipping probably win terms this pop you go of in is immediately. emerging The across I'm institutional I continues dearly, and you are fund ones product, and up but look performance. ex-Japan, Asia, GEMS markets the fund whom that those children my of at - love the flows its pond to is

John Dunn

you. Great. Thank

Operator

Thank you very much.

is Worthington your JPMorgan. Ken coming of Your from line live. next question Ken, is

Ken Worthington

Hi. portion Good owned XQ. filings substantial suggest the that Chris, morning, stock SEC sold you questions. and of during a thanks for you the taking

were by family. direct suggests controlled digging seems result than a done your like to vehicles But in and it the transfers past. other of your the is interest by just end was lower been others Federated some Some this trust that has substantially in

interest quarter? with at you to first, shareholders? you point? be maybe enough selling How during your do is own can that adequately what much explain to appears stock So align this the directly And

Chris Donahue

just I love I too. my said, as children, Well,

controlled right one. And X so enterprise, going the on inside of there commitment to back it have I in that and way that of our the are and of selling on. could shares in family exactly beyond as There X you goes trust terms And kids, I meaning find to the terms commitment in how my stock. our many know now. family, was no spouses interest don't XX and stock to out was my transfers get grandchildren. what's I that

whole is But and the that the almost in incentive. role adding the a what owned I'm XX% big plenty bunch much of is family Fort family the and enterprise. stock shares by But inside ball to incentive of are still family telling owned keep this and counting the our there's Remember, not rolling. - still you very are in of very,

And a good it's deal. very so

last that was sell mom of I thing that, shares trustee. am year, passed did the away her one which Now did who December my XX of occur

that and me. XXXth grandchildren PS, to distributions that's great counts two in of days grandchild various But to against children so was children, due and various various estate and all related born charities And to great planning the my effect mother entities, ago.

Ken Worthington

you Congratulations answering. for that. And thank for

you money share by to And from as during your the retail for follow-up, you well were highlighted for X.X% institutional in fell X.X% XQ for Just dynamics peers quarter. for as a as Debbie highlighted market true and the fund XQ.

loss share rebound the So you expect share of to would half drove the XQ? loss second in year? And in what the that

Tom Donahue

Debbie?

Debbie Cunningham

Sure.

being what largest presence at and look providers, it during do than degree retail growing the to - is is that we that some more think have retail than sector, sector retail that I us you money environment when if other disadvantages an fund a larger growth drives institutional. that

do larger start to a institutional in we larger minor back going way then rates ultimately way do to a in increase down fashion itself flows plateau forward, in only that much down market. slow out side we and that We the then expect influence a of expect again, going as in play even role that where

Ken Worthington

Okay. much. Great. you very Thank

Operator

queue to closing that all for any the we be today. that to in remarks. questions going to And the I'm over back management have the hand appears

Raymond Hanley

call. much, that our and concludes Thanks very Thank you today. for joining us

Operator

does today's conclude That everybody. you, conference call. Thank

have and wonderful You Thank disconnect this your you at and day phone time, participation. a your weekend. a may for lines wonderful

Federated Hermes (FHI) 28 Jul 232023 Q2 Earnings call transcript