VOYA - Earnings call transcript Q1 2019

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Operator

Good morning and welcome to the Voya Financial's First Quarter 2019 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Michael Katz, Senior Vice President of Investor Relations. ahead. go Please

Michael Katz

good earnings and who to Financial's Voya joined Thank call. morning. We quarter call. conference for you appreciate first us you, this Welcome all have of

are a available investors.voya.com As via webcast. the for materials today's or on Web site reminder, our at call

Slide to Turning X.

Some comments more you refer to this slide for made conference forward-looking may contain I of within securities the law. the information. statements meaning during call of federal the

are reconciliations on We on non-GAAP be financial release will financial our referring certain and GAAP also press to our today measures. Web available supplement found site, investors.voya.com.

call Rod their Executive After Smith, the on me and as Chief Chairman Voya's Voya prepared Chief remarks, Joining as Mike well are, questions. Martin, we Officer. Financial's will Financial Officer; your take

also Retirement; to call Charlie invited as Slide Benefits. businesses, specifically, I Hurtsellers, Christine have With to like of Rob the we our that, to heads session, over Grubka, Nelson, the X, Rod. would Management; Q&A Investment and Employee turn the let's For turn

Rod Martin

Good morning.

on Let's Slide key things. begin with some X

first the long-term progress cost in growth, organic capital made quarter, and further our optimal drive to savings plan deployment. support of we During

first Our of $X.XX up the operating quarter XXXX. first was normalized compared with EPS adjusted XX% for the quarter

full XX% deliver EPS We track are on to growth year for plus the XXXX.

on achieved of mentioned $X.XX. earnings from I normalized our this operating be February, baseline EPS As our call XXXX growth will in adjusted full year

is line targets throughout performance quarter the momentum across first with the Our and we businesses demonstrated Investor shared our that Day. on continued

for the on XXXX. run the In to management, million premiums marked consecutive net increased annual benefits first in quarters and $XXX remain surpassing the rate XXXX total with employee positive $X by now full end quarter we flows. quarter achieved cost achieve grew track of year-over-year $XXX markets. in to our billion. XX We retirement, quarter consecutive investment million compared XX% flows full net of enforced of savings service positive have first XXth institutional recurring XX% deposits And the service For corporate

$XXX beginning million million in repurchase quarter, of We a also $XXX the continue additional share capital. fully $XXX program maintain the an authorization. to excess shares And utilized which of position with our into first in million quarter. the second We approximately entered we repurchased strong existing capital of

announced we Board an yesterday, additional million June for XXXX. which our share $XXX expires As repurchases authorization provided XX, in on

of using to expect capital addition quarter. the to dividend repurchase stock third in X% excess we common In yield increase shares, at to to its our least annual

Investor $X.X we shares repurchased amount the As have noted same At shares of of by investor our have that will we broaden on in that's IPO billion increasing shares our an an to half our remains our the of outstanding approximately help almost Day Since shares. executed equating as and time XXX repurchasing excess we our attractiveness in buybacks at the our believe XXXX, use equal IPO. and cap base the demonstrated our we market capital. million increase to dividend will attractive

at our a to years least remain of Turning of to three and EPS in Slide of growth each confident on XX% we annual in basis. committed next the X, goal normalized

growth expect savings have and cost largely XXXX. in larger we growth, deployment. deployment. role savings organic will and XXXX growth shared combination a be a will XXXX, of In by cost As be and driven play achieved our through previously we capital growth EPS capital EPS Organic to

customers. proposition the to both quarter, our a results evidenced by compelling value and businesses As individually our collectively top-line provide first in our

the of that at on new pipeline, our organic component are Looking well we the our as as plan. the we're strength board in bringing clients of confident growth

of a a the as target to ability achieve years. our growth execution to management commitment and team each our EPS to record track company over Our and next speaks three

character continues the our building to X, and help our brand our success financial Turning drive to performance. support of Slide

to culture brand continue be Our externally. recognized and

companies was World's This sustainable years its XXXX by the go XX% of five year of worldwide on are one was most of ethics a list. financial only that XX%. been one named belief outperformed Companies is Ethical and recognized Most Voya XXX XX% to large performance Each It company again companies Companies XX% only one as since Barron's sustainable ranking in XXXX by more XX% to by earn number This the there hand-in-hand. also of one to year year outperformed the XXX number have and this cap the Voya's World's by recognition Russell and in analysis and services. financial overall the Most a turnover validates over earn companies proud Ethical which about six most six that Ethisphere This XXX S&P with second to index have the to than We Barron's the category. in consecutive According Institute tracks XXXX. services financial years. five the for honor Ethisphere, for

diversity Places XXth America's for quarter, Mogul's employers for were Additionally our we of Equality and we Forbes on by consecutive best Work XXXX to U.S. a the inclusion. large during the the list also as spot and were commitment recognized earned We the year. XXXX Corporate to the named to the Index one in Best of

our that distinguishes and let performance we that, increasingly business on Mike clients our pipelines. the other our do from details financial to our our is are us hearing culture way business me ask impact an With having more from performance. companies provide on and We and

Mike Smith

Rod. you, Thank

long-term adjusted DAC unlocking. by mark-to-market $X.XX normalized excludes alternative Let's $X.XX operating begin This income on below affected of private of to favorable fourth investments on equity Slide earnings expectations market Alternative income $X.XX equity X. of quarter, delivered and our In was tax the quarter adjustments performance. related first we share. per after

for $X.XX quarter. most reminder a assets On earnings of the share after on operating on reported three-month per lag. basis As a is these adjusted a performance investment reported tax were

the relation sale transaction of a XXXX Our price purchase true-up adjustments net our first quarter result in This and businesses. the operations. continue We purchase annuities discontinued expect additional income reported view within favorably. to the to included GAAP price is to not material $XX do million

Our as We full operating XX% remain $X.XX. first grow by adjusted XX% in highlighted to XXXX EPS year normalized after at our on track earnings grew quarter least Day. year-over-year tax at from Investor

income unfavorably which Moving quarter Average adjusted long-term was Fourth the reduced in to first Slide was X. Retirement expectations markets quarter unlocking. delivered than excluding fee of by affected turn million operating in $XX This earnings the affected asset were also below $XXX of quarter XXXX. first income. balances alternative million. which equity lower

pension were also Expenses quarters. and in reflected flows the generated associated plans a legal flows strong and higher with as earnings costs quarter. which costs future Net new our expenses of in In will addition, administrative in accrual. of improve service retirement both $XXX investments positive million higher distribution remain reflecting full onboarding

full recurring $XX marks inflows of corporate deposits five in to of first consecutive grew XX XX% over This quarters years billion inflows. in quarter the nearly full net quarter. service consecutive markets XX-month service Trailing

plan first growth track assets lower quarter by a have year service assets, quarter fee of XX% of the termination of both assets finished in We with due approximately the which achieve recurring markets. on quarter. pipeline help income higher XX% client we a strong to target new equity planned XXXX. compared billion helped should to Total second recovery in deposit across and of full were our in record last discussed sales ago to year This $XX keeping a are

a XXXX. delivered $X investment said, of Fees in in Following X% the be a quarter record the compared the the pre-tax of normalized of with earnings XX, That million capital well fees the quarter not roughly was This expect quarter large operating line management as repeat first as in businesses in XXXX, equity of adjusted deliver were year million over to XXXX. earnings in below we On XXXX period we $XX expectations. with long-term ending in did XXXX. private of in retirement confident closing to fund three quarter. results retirement for year performance the CAGR normalized first with X% associated to first earnings a earnings Slide Investment ability with XXXX. lower roughly remain

the balances recovery. legal lower in expenses fees, in our resulted were outflows administrative institutional fourth that a quarter quarter into asset this first retail business in offsetting in partially growth lower the and addition despite turn lower and compensation In reflecting extended variable lower

managing operating returning proactively to quarter flows. margin institutional investment over including a was first by XX.X% quarters operating generated of and our institutional Management to do trailing XX% Our in XX% XX-month growth XX basis organic first expenses. quarter and confident in to inflows on We expect to net remain Investment positive of by the consecutive through XXXX net $X mark margin so capital. billion

strong driven which distribution of capabilities. over $X.X garnered record the months, growing net performance. fixed investment last This success the The core been our includes third-party of XX have and continued track capabilities, specialty has income inflows. we companies strength Over of billion insurance institutional by to our

we mandates. the sales fund Income includes During is assets Strategic sizable Encouragingly in year-over-year, This success top a $X saw XX% surpassed retail outflows the of quarter, its driven quarter last our billion loss Morningstar a of of few and by continuation the the Opportunity gatherer which retail grew asset of category. Fund.

under as XXXX. XXXX see management beginning can a a X% we confidence, ahead, of X% flows us in the remainder net sales of giving for pipeline we Looking assets to healthy of achieve percentage

investment with expect of a X% three-year deliver X% XXXX. to ending management CAGR normalized to the earnings We pre-tax period over

capital million trailing employee first a Slide Return on quarter earnings XX% benefits in remained excluding basis. $XX XX, of to high at unlocking. delivered the on operating XX-month Turning adjusted

billion in XXXX growth quarter operating adjusted this First was few for $X XXXX. strong total premiums, almost XX% reflecting above year-over-year XX% enforced growing in the quarter business premiums XX% supported enforced over the grew the drove last premiums showed from This first higher which we growth had have with years. first Voluntary success consistent earnings time. by

to and driver significant a distribution we strong leverage saw continue historical in-line with of loss expertise Within remain by rates, to more with life while expected we loss, range relationships were return ratios pricing as XX% to stop discipline. relationships. XX%. within of Total strong our year-over-year a the we growth grew growth X% our to our firms. maintain national aggregate Group enforced target premiums driven strength We

XX% continued of with the adjusted $XX pleased the million period benefits than of X.X% quarter on confident unlocking employee XX, And XX-month first to operating quarter a were over capital XXXX. very earnings three-year was to pre-tax ending deliver on Return $XX normalized first earnings CAGR On XXXX. X% our the success. basis. million are feel in trailing higher ability with excluding individual We Slide in life in a

of end our were In below to income we our First our alternative slightly mortality reduce new was run this business offsetting cost at to expectations results the decision by annual long-term partially rate favorable to with frequency, $XX XXXX, due quarter expectations. lower connection announced to plan cease million.

We have achieved this rate. run now

quarter. million we a administrative be second approximately expenses As result, in $XX expect to the

we We the million. first sales in be process quarter received reported through in also to This XXXX resulted anticipated year-end as of XX XXXX. sales applications

into applications will This second complete. the now reported million the to approximately in quarter. Some additional quarter carried but be sales are over in XX of second result

come at capital next $X continue ahead, redundant for Looking to billion onetime a the quarter. XX, we release additional to positive to XXXX. XXXX Slide EPS. including late five least or over this from have six a reserve related free impact consider Share will repurchases items of we significant on of On to financing expect years to cash early in block second the flow provide

partially In following items the administrative to at expected mortality reserves we normalize individual to expenses to not not quarter. an management addition, investment life recur and to the the in expect items higher second quarter accrued Seasonally offsetting expect legal in in legal recur. first the recovery levels not retirement recur and these same we unfavorable

we stranded to fourth second addition, not stock second costs. Also preferred and semiannual reducing paid losses lower due our quarter In in the quarters. expect dividend on is corporate progress

to help share from warrants appendix, reminder, In a a our will impact include price the given the our likely include you shares current warrants. the sensitivity calculate increased per of the quarterly As we levels. earnings diluted table share

transparency some will there composition be greater consider, our portfolio. On second have to the that factors of Slide into results. items course alternatives provided provide performance other XX, affect quarter and we EPS While of we

is expectations strong and long-term Currently over portfolio billion see, you our generally has with is As performance our our over delivered private investment of alternatives in consistent portfolio time alternatives equity. X.X two-thirds of X%. can invested

quarter First by mark-to-market investments Most lag. quarter are of equity private quarter equity our results private on to a the related were largely reported market fourth equity impacted holdings of performance.

second improve quarter equity expect We income. rebound markets alternative year-to-date in the to

Turning to Slide XX, strong. position remains our capital

XXX% target of of estimated significantly of Our our end exceeded XXX%. ratio RBC at the March

RBC $XXX quarter true-up for million capital earlier. both excess I excess annuities first ratio the of end mentioned the was capital price our adjusted and the are at purchase Our

sheet March of on certain related Our was debt-to-capital below the our our target. importantly an ratio was related unrealized to many XX, Included impact our it increase onetime balance XX% gains. reclassification more on in debt-to-capital XX% deferred our comfortably a reclassification This tax liabilities peers, us assets. with of but of our to value deferred aligns capital does not tax closely ratio

second share are for million quarter additional quarter, Board provided expires also million an the executing which $XXX of end and During of on XXXX. arrangements repurchase we The additional repurchases, share to million the the completed $XXX authorization at of accelerated repurchases $XXX of shares. an

half $XXX million be XXXX, the once utilized second current We guidance ASR the the on will will provide in is of much complete. of how further

we Rod third as we our least further of at stock to earlier, expand plan addition, shareholder which annual common an XXXX, to yield quarter base. increase X% shared In believe our of dividend in will

XX, our free Turning reduce and business risk. few years These flow to generation. the simplify increase deliberate actions to enabled to have cash over we've us our significantly last taken actions Slide

and to to Our to very remain and summary, XX%. now largely peers. of flow our management. free XX% yield savings favorably free in ability cost grow to our least XXXX in pre-annuities level to cash due This flow transaction capital conversion compares nearly at cash projected EPS confident is supporting In XX% our we XX% yield

encouraged are in underlying will sales growth greater our activity believe and organic XXXX and help this beyond. by We generate

your VA capital I the we cash the to position and that back has Our remains that, on high focused turn balance minimal can business exposure strong. risk no would mix and tail minimal is so conversion questions. with With take care operator our sheet and long-term call and

Operator

of We'll Please Instructions] question-and-answer first Barnidge your John the Sandler now [Operator line begin with session. question O'Neill. comes with Our question. from the proceed

John Barnidge

My benefits improved the seeing stop dynamics is Can several on the in of environment the meaningfully in quarters. some competitive Thanks. question ratio, you pricing employee about talk it's last loss the you're there? maybe

Rob Grubka

This to like a John. business we've are we be Grubka. with quarters, sales and well perspective what for of the new feel of that that stop the getting talked growing one as business was the like back repeated loss about in pricing running Rob book very business as good was Thanks of one-one confident of pricing that the around we where all versus range. We going for said is the wanting the of despite that I've On Yes. X-Jan-XX. to in wanted and from range this by from back year seems to been thought it took in book feel stay action last that that that we're the get ratio turn and saw the loss we'd We we in the to at intention, that rebalanced mix a range back We end we that action and growing driven we step took going and very we renewal our perspective. and cycle to sell we 'XX see. a were continue the size sort

John Barnidge

then, last lot but investment And follow-up in know a the of management. the was Okay. year. markets my were quarter, there for first volatility I cooperative questions

quarter? your with maybe on how some pushing fourth the this consumer conversations about or we in talk maybe how if year for they're clients volatility like saw the of kind and answers. Thanks change you can So have after behaviors changed the fees

Rod Martin

will take that. Christine John. Sure,

Christine Hurtsellers

clients. sentiment trickle of really quarter fourth as the business in the that's John. that volatility saw first our impact of mix Certainly Thanks the the result of flows. far quarter a did and in as with some a into as risk-off as sentiment But you the say we more that shift

And really so compression. demand of going slower start that, and in would to the terms asset I but seen because we specifically their got of of or little were a it allocation haven't fee year, impact say people where fee we bit

with of And basis. assets, going we it on so at management do we -- what yields back taking when on look managing at when like XX-month to do and fees trailing look to and is, which what's on look you you would kind we're a and investment at the step like a our

And our mix us. did issue based the so on really fees inflows again, we have business lower on that on four basis a our points more were outflows. the of is fees But for than this

again back some outflows some But mark hit you very Opportunities fund Income points that mix Mike think on last is did comments income more momentum, seeing today. we're now we on billion. issue, Fund growth see seeing out to front. example, Strategic billion and that over the that's and our is by quarter, is billion It say than fund granted and an Then large due Now equity. funding really strong loan in to of business retail what to bank fixed that again, the his mandate have active one retail strong so fixed as the going driven basis how we're side, $X income about mandates more mentioned we $X it risk-off really $X.X as the

we scalable, fees business associated highly more costs the frankly it's team, be typically fixed aggressive the strong we minimal so of very have you deep are accretive. to because that variable that tend so in margin are And so when so have if and with quite infrastructure, income size a type they

of it expect about more is, So as unfunded fee our again pipeline I and It's about to and same the have clients wins or revenue would in don't fee settling think we our team year, the as later in. funds. higher of far and compression. private mandates demanding business landed as real and and overall to credit driving looking mix our in at think just thinking part for about a income it how it, fixed to yield market some debt our in debt are infrastructure -- clients. But, We the coming products of terms added a margin estate team

with to going in as most being likely the year a we're so with early back launching equity. And next fund well XXXX as market in be capability that private

that we're I given strong achieve able we growth that to and and see. again, our targets strong our be to organic margin pipeline, would So say growth strong going earnings the

Operator

from question Please the Our comes with next of question. with Citi. your Kamath proceed line Suneet

Suneet Kamath

us sizing from release business redundant the Good life the can morning. help mentioned you you with Mike, remarks? your to that Thanks. reserves the prepared in

Mike Smith

Sure, Suneet.

I way to it to we've income rough the six the think and is, numbers. the next guidance about year into as $XXX conversion five that's think Think of that given over per cash years. million of on

And up delta plus. you and total so, billion add between to left there's guided that a when a that the billion that we've

will release for I I that the parties, think get not that -- our discussions create reserve still a it. We're a to to the I don't to opportunity want ahead. I expectation to much about of us. in get the with that's close far to ceiling is be want gap. think But way redundant careful third want too little for

Suneet Kamath

the seems Okay. XXX Got your -- through I around XXX then, buyback like pace on guess it been the end maybe the of just has second authorization, it. XXX. And buybacks quarterly second of quarter, the

to change could of second a this expecting we there's buybacks the if new year? the just you in next pace exhaust terms roll Thanks. if for a are that of quarter be one out preparing authorization So you wondering just here or

Mike Smith

question. for again the Thanks

ASR into second in in that the the at time we remained to So ASR. the the we have place an that we're entered clear, that represents -- million quarter XXX authorization for be

for our future that with additional our Board, million. up. expectations So some XXX we We and discuss an authorized use the of

same past. Our plan we've is use the judgment used to that in the

shareholders managers prudent of to can. and way best eye maintaining in an capital careful with As shareholder delivering toward the we value

consistent share another authorization. the exhaust when with seek that. And if will then and we we'll execute So we as XXX on authorization million repurchases

So not authorizations. definitively to you not should through signal we're trying and timing these

prudent think we've that that's we're do going gotten that's think part what annual and people the away an in of basis. do reason we'll a having the well were ask proceed so we as that time on is from interpreting we're what at to going year, I And to

itself. I track speaks think for our record

Suneet Kamath

you. Thank

Operator

with Our the comes Please your & next question Lee with of Humphrey from line question. Dowling Partners. proceed

Humphrey Lee

is morning there and pipeline was and institutional my impact for so was strong thank in indeed inflows quarter for understanding especially A the you the of and question you investment questions. were in Christine, in wondering issuance just obviously in some the issuance very also management Good can taking and business. coming terms the of size in quarters. potential the I CLO My

Christine Hurtsellers

Certainly.

about they're settled CLO sales as in we But They flows just CLOs, were under or our business last important part far the quarter, you mix. priced our of XXX little year. first of As XX% an million. a gross when think

an example start about overall searches have got But in our seeing the mix products. a only So I you strategies consultants XX have you driven range would to not soft CLO back of an in to just say ratings growth the business but by heard year. CLOs, important of organic point what's as currently kind really and and of the market your reference represented a because semi-finals consultant we're part of one going finals. we Oftentimes our real me driving terms in interest

able key in we week, it market And deal. for CLOs €XXX to were and second outlook the we're to priced euro what doing is, the CLO we're thing to doing, million. still last that However, continue is one our we our price was improve

So, in XXX about dollars. think

both European And bank and so think when interest the invest out to Asian about encouraging very you loan and investors there. well seeing XX% as European grown that's market, it's increasing we're of year-over-year as

a in we're cap. so launching also Euro And June

CLO bank products. see in our building interest again, loan I So good across pipeline and

Humphrey Lee

would normalized you just Appreciate Got with then, clarification with basis so, flattish? the if that be for I expect or Would bit Mike, the of you in mentioned earnings a the keep that a XXXX normalized earnings XXXX. what reported in little it. on are it a think And like XXXX? basis a color. of drivers the realized XXXX line some And be

Mike Smith

I'll clarification answer DAC to a business. more it's is, But, and and start the and unlocking prepays Charlie chance of then normalized and year want Charlie dynamics in the the from some with versus for at to last are talk some business. driving the that's give the alts dynamics maybe short expectations. the that you of normalized share retirement about

Charlie Nelson

you give we're bit I'll Sure. little on XXXX. a seeing in color what more

the Mike had indicated And reserve the categories. overall largely in to comments in increases due As that some were his legal of beyond increase business. and our in coming growth the we've we pension expense, handful retirement business in seeing it's a our

we quarter look year, you year If certainly of and record growth a last keeping quarter [ph] we capability. [month] did acquisition all versus last one Pen-Cal had the the at one

a just of that lot year give committed So the are and last overall color capabilities. we've our seen in the in investing me in in And also sales, but and that activity. a year, let pipeline growth well RFP first process little wasn't we our us then, certainly sales are business of And quarter both that. what some more as in on in this as see and you given in expanded as

plans XX-month Xx first if on -- brought look trailing quarter, lost. through many as you basis a we've Just about at we've as the

in quarter and corporate were Our quarter-to-quarter. first full up our XX% service tax sales XX% in exempt

we've and about good trying in look in been results some really past our us distributors, in that really the sales the we and for and trend corporate think leading saw we where we've how at the that's quarter look expansion sign. to a particular good at drive we talked that first that and distribution indicator distribution expansion from we a future for new market in the that XX% came for good of new So was our advisors

implemented of pipeline last our process higher than XX% are in full that corporate business it was right of and our being in year the service first is now quarter. the for example plans So

on, activity of then, at large at corporate record of market in implementation on XX% large full going increase XX% look have looking strong We we're number in keeping a the see robust we and And in a the in process looking in service equally increase wins. activity a forward -- RFPs keeping. the about and record an and market the we kind

prepare -- are gorgeous help largely we even in for to bring it as the go I and there's expense So investing hitting more us side we're business forward. momentum the business, on think and to

So Day we're target as of we said compound Investor say. to planned to as our rate more achieving X% confident and sales, annual growth the and on our X% in drive should I Mike growth a sales continue

our the as which well range XX% deposits, the Our continues within really retention to be strong as strong higher recurring we in quite quarter which were had this gave guidance.

Rod Martin

plus confident early what percent The call. the Christine part what as is activity early growth rate mentioned the reaffirmation objectives the about, what in of Charlie I from of from said, deployment. and Charlie as and expected, that and Christine, us part on that over planned you are share we of that additive XX be going you we heard Humphrey, EPS with enable capital be heard and committed Rob and the reason by we stages the those sales to comfortable you accomplish and what to heard Rob will both But buyback pipeline this we're driven talk to period. the are the believe

Humphrey Lee

little of a It year Got growth sounds kind up sense. opportunities. That bit like of makes future transitional it. just building

Rod Martin

Indeed.

Humphrey Lee

you. Thank

Operator

proceed [Operator Please question. the with Suisse. question Instructions] from of Credit your with line Kligerman Our comes Andrew next

Andrew Kligerman

of give maybe in the I a there sales just color you interest very comment, I'll any you lot that. block at leave considerations appreciate maybe And just around but blocks? is little of on a about these Hey. need the in your Mike, it much. interest Thank business, timing could the in level, reinsurance runoff

Mike Smith

running clear It's Andrew that redundant the in the I'm are reserves business. not you that about transaction the a way reinsurance talking about to thinking financing be a transaction is it. of

ultimately be of the will a down third way We sides. robust entering we're into will and We've with working of and working an had potential both with we a be number narrowing for agreement process our a through attractive think what third-party. parties discussion that

we way So the year. the expect toward working be its that's that done of again to through end

be broader reinsurance that. going opportunities, continue looking to beyond we In have interest opportunity to for any of to open an for terms that's be and us. additional more I color don't

think market long-term efficiently capital quickly just focused right getting unfolds. and the the as on quickly I near now very both and managing over as as as the we we're the out and business as can. But,

Andrew Kligerman

an the freeing redundant up see I up reserves estimated would much capital? free and how in

Mike Smith

range, create range that's it's negotiations XXX-ish need, are the that's to I in a and what structure I going to I a ceiling because a want said on do the don't of in as do the If math, we earlier, say deal? there's really we're still to you but the think broad

Andrew Kligerman

separate Okay. that apart And to… hope you from the billion that's and

Mike Smith

to Andrew us a the billion. solve that's to get

Rod Martin

That's a piece of it.

Andrew Kligerman

Got it.

And Okay. fee then, bps. retirement did calculation q-over-q fourth XX a over about levels. quarter the to just We was it shifting

in fee quarter XX Where there in there do you about non-recurring levels that sense, it get quarter? were dynamics First came were out want going a you the to bps see to just any and retirement?

Rod Martin

Charlie?

Charlie Nelson

Yes. Thanks.

think within particular, In drives what through the also with some the at -- see and may expense peel things drive lower from fees associated look of time. of I savings. think quarter-to-quarter. the you the that noise industry from to of come the I fees, You're as layers but away fee look time change some some We in at examples and to we've pressure managed going

more it fee-based you examples. a see a of the commissions with reduction from approach also a in couple move revenue. expense as quick plans revenue enrolment of switching with We and those more types advisors just and well. may example give show things and auto associated that would commission me reduction this come to will to or lower as e-delivery in more the be second comes But expenses Let A levels. lower

do say So each total plan are and variance come -- to by source from focused the that on back not on we I revenue brings basis revenue us. quarter-to-quarter. creates our the would some of manage But that profitability a really that business individual to

We some both us diversified scale that investments it of and that well mix of spread as talk the market relative I think scale revenue about and a revenues I because So, really and us as served retirement back fee a well. in our markets to breadth bring our the business, fee gives step we of our revenue the -- efficiency of has variances.

So, had it deposit think gives that average in complemented recurring by I it's we've growth strong the -- increase an assets.

I So see achieving this embedded we've go confident we -- at and you any established got as that at we've remain in our in the as forward think this we look targets Investor Day. expectations changes and

Andrew Kligerman

Thank sense. Makes you.

Rod Martin

This Rod. is

said, to Charlie a will Charlie to And to of this in the point, Just deposits advantage is diversity those as reinforce plus think billion these we have year. what we stickiness of dollars real we markets forward. XX recurring assets add of push the

Charlie Nelson

our different XX calling over you stickiness with business out when and in were example and good in years. very our Rod as the and industry. management on see that XXXX look than us full you recurring you point us that's what for typically of asset the service that's at a And very, assets; an full for assets because thank business that those in service deposits our left

Operator

Our ISI. next your question Gallagher from with Tom Evercore with comes of proceed the question. line Please

Tom Gallagher

Good morning.

level as were question specify of higher and a the were retirement you were of expenses on as to well different related levels onboarding the I how to higher question. quarter recur? Can elevated that's there well, those elevated they're expected new my Guess, plans. think pension expense whether expenses Just as in first expenses

Mike Smith

I'll is This by part. enterprise some pension the the over an of the cost, take cover, over well I'll quarter as forward levels driven million for that rest. will asset expectations At part be a largely the going $X I Charlie And pre-tax. is which I'll it about turn that's by then future level prior Tom. as take and to Hi, modifications year returns. will part up Mike. our in for

Retirement to of want color rest to if will pension going retirement by it. business management segments. then, majority the -- then mostly costs So you more that's do the followed add and we will majority investment hit have of and Charlie, to be And benefits. the employee allocate that on various out the

terms that piece. seen in announcements the with other Charlie. also pension of You've

Charlie Nelson

Tom. pointing And Yes. for thanks out

is that my and growth due but that a truly process in up seeing overall what the net to we're plans mentioned really came lot in add in are expenses large -- a question I also business and administrative to business, pipeline. our As just both of our in the growth part the the previous on in

And and accomplished we million scale remainder upside we look think our the and the and the and of but with in be and consolidation, as as we're the XXX we've of for phase our investments that on helping building made efficiencies expense very that digital you lot, if proven have platform more and XXXX. in to the with quarterly the track we've that have a we've expect drive of lower business of And an are automation our million So robotics some at data run to said strong expenses. brought we rate next about I awful admin remainder us of kind also got analytics I what expenses I additional XXX in in year driving certainly for think future. believe record

So it anticipate growth focused and we're I for that expense also ready But, the strong we're and and the look of we're making at disciplined. growth we bringing what sure kind in future. management on as that on remains

Rod Martin

think progress $XXX over made and million me growing the quality that. prepared as that excellent one to get we The about they our stranded XXXX that have growing you costs, and our Tom fact the approaching discussed talked at before piece the recurring Mike add we on an a let to than Mike again pipelines our million we faster as remarks, update revenue. to other have rate is We've will are a And question. expense we in is improvement lead Investor historically, at giving again, made second Day. XXXX in $XXX in

Tom Gallagher

quick the would Thanks. XXXX would you makes pension expenses in of if we -- down a Mike one elevated same? Rod. finish million the remain X That that that sense, follow-up year quarterly on the And to levels, go just year expect or at current

Mike Smith

Tom, did remeasure levels been a of and there clearly as and mind good January. since asset of end that are favorable aspects XX/XX of question. calculation. we the it's in There's that's Keep that the two

of related of starting new affect our there's future done in the right year. rates than I a will the curtailment the interest are I cost that's at liability. event I were end quick to the they So interest haven't pension. check. point other guess because the expected the -- But now value And rate reduction a thing the is the meaningfully environment of lower think

the on we So closer to or be. tally a we don't of guy. get we We'll at be see to going run you where running a good we're guidance year end going we'll whether of the give are as clear it's a where bad

Rod Martin

mean us just the else. Tom are And reinforce to our Mike affect of those both would points make. macro issues. I will they as everyone They

Tom Gallagher

enforced Understood. And was on such up sales explain but then, why you there? Can in growth was more one the enforced one voluntary big muted. just year-over-year, quick benefits substantially growth growth

Rod Martin

am the let the remarks the voluntary mark. We're I'm it very great to leading question. mentioned in answer the pleased the going opening and very happy with business. we on I Rob, of doing hit this, Rob's to to but the focusing group Mike billion benefit the $X growth job him question XX% throw piece. life growth, very both in the stop-loss and a Yes. happened the piece, that employee piece I'm so our we're happy with

Rob Grubka

is. years question that administrative VB what we've of I'd level a back you of is the appreciate and into what's the really how really you execute know a business retain. We've those and what's growing price. around come to at you then that's the aspect service I what's is it's few extremely sales had come difference end that's the remind business overall block and the the credibility tremendous around over to got easy play the the folks maker. of well. to At of effective especially executing portion it times, the the which is But the that and sold where a And it? the last intensity, it and ability marketplace. just of Rod. And that's technology success -- it's service We've big market like? middle deliver. work and to in well build the folks I and -- why efficient How with price, integration upsize look and explainer That's partners, ways, Yes. with the And the handoffs our looks what do the this way

that continue to future. done And to the and so know we that that do we've well expect in

Rod Martin

speak might to about of that listeners? the versus replacing are to want be many the may cases coverages coverages you Rob, how useful new adding

Rob Grubka

Yes.

And retirement workplace and different to we first actually and than of space, of lines not quarter think we think it's somebody about good added the I this something that often whether a taking or it's as than over little our pointing the else other what point the bit more half a Rod's it's -- in out. dynamics benefits business, new saw to were whether whatever other coverage product you're groups in from set.

indemnity growth is Day, by borne or Investor they're demand long-term on with about growth high being accountability at solution. so talked an and decisions benefit and have didn't still have of product they responsibility And accident a growth the to didn't and the product so and hospital to the they health we consumers net of driver for So the years this be a deductible for plans, going think come. today the we just

Rod Martin

integrated administrative business. and it was I'm that both Rob let's nice but more company, just Tom, ask very the going capabilities claim a We we of voluntary awarded, piece to a the And just given to and piece. to name capabilities the particularly one add speak were bit. can't

Rob Grubka

the you across from for connectivity to a perspective and the And the to job. products. end doing voluntary is an further. does market. think, of make perspective. that story the area that the is service a of management from of we that get of and with in think see story How rollout differentiation products think an back where we more we and think seamless time we're leveraging claims that did for This Rob leverage things Thanks and activity products experience connect the of lot We again do about Yes. HSA that's the execution the over ability claim what the again to an opportunity We day. easy to consumer product that the with area other a the medical how at consumer the there

Operator

[Operator Instructions] of Our Please next line your question the UBS. from with proceed Nadel John question. comes with

John Nadel

Thanks. Good everybody. morning

questions and it two don't there's that have market on retirement. opportunity really mouth, I words lot the I to win. One, sounds, very in but guess put activity of sounds lot your mean a of a I I to in actually bullish So want it

a so know record York lines, keeping plan New guys City. won the large you I those recently for And along

billion I think that's in account excess of of $XX value.

like Just high, curious should of more are front when just expenses expenses that sounds board in very it this growth. really but come likely revenue on broadly and is

Rod Martin

affirming we're off John, are forward. of Charlie record let our jump point But, a they're start. go me is, across to we're and to of markets. But The the trying of will a guidance market pipelines year. mix the building robust make in. the And we're part again, sales committed our

record this has characteristics. and that is different of some keeping So

is Some to full Charlie? both. Charlie will of speak this service.

Charlie Nelson

Yes. Thanks.

as first I selling our you the the well our keeping in you sales when and new business. seeing of tax full are number as correct, in in service the and corporate. And and the both activity the my activity terms -- in well in on comments record the service with us interpreting on of advisors, that overall the advisors As as I we're increase both full as in in quarter mentioned in just growth exempt growth

and measure plans and activity, quotes in that coming what we're be looking at pipeline at terms estimating week things. and and will we implementations day in the of every look are every that we new the essentially So it and

our say of is which York, New be up, the the wins, record On XXX,XXX for one large of City and $XX to front participants about keeping you about recognizing close That'll as you right billion. of we we be implementation we're the latter on this would expect of like as period the year as time the to part fourth Each speak. -- part a you later working expect quarter. thank that

is in very, of and and things that the pleased keeping has record we're value the for future. growth full that support very the proposition we're been both our resonating commensurate lot service to that in So and a activity really in hoping

Operator

comes question KBW. line with Krueger proceed the of from Please Our question. with your Ryan next

Ryan Krueger

of low Thanks. on just think parts the in the follow-up talked Good fee and but about a pretty some had institutional quarter. moving morning. for Christine I asset I wins, the you for upward rate. management just know new I some looked trajectory the

So one-off I a factors that about were could talk any there was impacted just if hoping bit that and you that? little

Rod Martin

Christine?

Christine Hurtsellers

Yes, Ryan.

mandates sometimes stages. over year to what's have On come a more are billion funding things three the very year in dollar large the institutional basis to in back than or first into of of last point aside really clients these the and going currently moving late year or two was mandates part as a as started we couple this and large that funding may one

a the fee the CLO we institutional speaks because flow different tend than price deal Also we've for and we really highly had we in to done and it competitively, January deal, CLO really more and accretive. was again, margin that -- level strength those that shorter was in priced and were that market was able deal. a bit Sprint of bit the time because of do that term just to little calls a which it very was a something but lower we the franchise a nuance the it scale first what price to of first a again, quarter, normally little So,

I reinvestment typically do seven was by five shorter just that? what have to This CLOs years. mean one periods year. So,

because we fee had a shorter, was So again, more there. aggressive it

that again, one, So no it is And not the the of think a but side as again, really mix income fixed a mean about business. on really strong. trend, I momentum

of or take are products, that peers that the for XX and investment you'll go for for If assets are years. our our at X look performance, benchmarks XX% the income assets and X, fixed X, managed outperforming you see a

In fact, the X-year number is XXX%.

move launches of you're mentioned anticipate expect to And I good retail the year, going part into see in there. I due and that strength to So continue a referenced, we as as back we to momentum again, the the couple XXXX, higher going that to equity raise. of And product are the then, fund private market new in gets back Pomona, through again new a business our the we're going be with margin. as into that

XXXX. first in to up You the you flows should from in the see or part see expect the saw revenue we'll move what of

Operator

closing Rod time we all for I'd over is remarks. any the for turn back like questions, to to the have call That Martin

Rod Martin

continued Thank in for success. during to And summary, first Voya the quarter future we position you.

growth, and on on our capital to cost deliver deployment. are We savings organic track targets,

be are capital and our institutions on plans our company. to ensuring our achieve remain shareholder our solutions growth needs greater well focus seeking. in as with we Our supports returns high Thank the strong by foothold customer to the to workplace meet pursue vision positioned that deliver and customers high We we good America's businesses our return life both drive anticipate retirement day. and our you to

Operator

for Thank This participation. your teleconference. does today's conclude you

time You disconnect your have at lines may this and wonderful day. a

Voya Financial (VOYA) 8 May 192019 Q1 Earnings call transcript