Earnings call transcript Q1 2023

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Operator

Good morning. And welcome to Voya Financial's First Quarter 2023 Earnings Conference Call. All participants will be in a listen-only mode. [Operator instructions] Please note, this event is being recorded.

I'd now like to turn the conference over to Mike Katz, EVP of Finance. ahead. go Please

Michael Katz

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

call reminder, a on at materials today's As are for our available website investors.voya.com.

supplement of some are release refer call Federal or comments made certain Securities on meaning available of non-GAAP press financials found law. X; may Slide during financial forward-looking reconciliations contain in website. to our and the Turning the GAAP statements to this our measures within

Additionally, comparisons refinements slide period you incorporate. have prior LDTI be the and to I recast include for to earnings for information. adjusted operating refer

Additionally, reported as beginning Solutions be segment. Benefitfocus Health this will part of quarter, the

Templin, we the their are Chief me our take Lavallee, will on Financial joining Now Officer. questions. prepared call After and remarks, Heather our Chief your Don Executive Officer;

For of session, and heads also our Investment invited Grubka, businesses, Workplace the the Management we Hurtsellers, Solutions. Rob Christine Q&A have specifically,

to Slide With call that, to Heather. turn over let's I'd X turn to the like as

Heather Lavallee

Good earnings of our XXXX morning. continue the first targets. exceed we or strong quarter delivered to meet revenue Voya as growth in and results Financial

We three in annual investor over expect target compound period XX% the continue to EPS growth to meet our ending XXXX. to day year XX%

benefits. our Our year that financial we successfully their to maximize plan, focus acquired ensure on remains integrating squarely executing and strategic last on and the businesses that we

will already in are seeing results. we As discuss, benefits we these our

themes. X key with Slide Let's some to move

plans, businesses momentum Voya’s reflect strong all results the and revenue For margins. delivered we our our our operating businesses. across execution $X.XX, first quarter, and commercial of of the profitable of adjusted growth across EPS demonstrating These

the In recurring annualized grew premiums enforced and XX%. Health to outflows quarter continuation Wealth InX XX%. we net nearly of challenging For conditions. deposits Management, the market reflect grew for service, largely fees Solutions, full Investment Solutions,

approximately $XXX global concluded once than at much million cash more diversified conversion free strong our with mix and XX%. capital competition. the of us We the in excess again investment strength outperform our and allowed quarter of flow markets, remains However, strategies to rate of

confidence As half plan dividend macro board to of and strength, XXXX, X% further continued second approval, the subject our the our a capital and yield reflection to conditions. in capital to in business, of of generation approximately we increase our constructive

to We also intend quarter. repurchases the resume in share second

In addition, this that refinance financing $XXX approximately with will $XX cost about month million save us we interest annualized of million will of lower expense. debt

key on we performance. clients, valuable target net shareholders. more We execution, will capital of achieve expansion and and to continue our we results our period on growth, while of relentless returns solutions revenue our share XX% for for ending few strong on over deliver in moments, focus investor on a to three Don margin growth targets EPS execute of our prudent day management will adjusted our the operating year to In XX% track XXXX. and remain our Because

while growth X, to Slide acquisitions the drive well have accretion recent strategy the into future. Turning will that immediate and essential delivering earnings components revenue Voya’s delivered of our

investment strategies it resilient improvement. management's of assets source investment business which even growth. We is catalyst powerful been continue have further and challenging flows This a revenue highly margin macroenvironment, net acquisition in be Voya from growth positive last with benefits to a formerly significant and year's for and a proving see AllianzGI, of will and

Our on, that capability international a capitalizing world distribution Investment already fund we launches planned distribution Management for class with with XXXX. AllianzGI several are international Voya partnership with provides

accelerant savings. with life provide our, and as benefits while and Benefitfocus, of transformative is January, future acquisition as strategy as on drive Voya we acquisition Benefitfocus and strategy. our in across for made savings businesses. their a enhancing essential a Benefitfocus we leading and workplace our engage Benefitfocus point provides strategic with workplace Benefitfocus completed on the is the years. progress putting less brought use its we've app. grow that guidance AllianzGI The building support we enroll to executed benefits in connection a together benefits decisive X, is than Because and can they an which Slide need it their myVoyage a they with to represent workplace in experience strong year, critical customers already components, block being workplace savings great place track in have market and a moments, fully financial Voya strategic key providing at integration we in and to Turning remains our objectives. develop

continues X, that Slide and outcomes are and doing vision our and apart benefiting We're stand us purpose stakeholders. to to by clients communities. and in our customers, Turning health, our while by of drive addressing all investment wealth growing measurable culture and living help marketplace, together, colleagues supporting needs the our our this of the also

for clients, rates participation and employees City increase XX% Milwaukee, our XX%, the we retirement example, one by For of of black respectively. and Hispanic helped plan

also every We companies have several world's as during eligible. been for year of ethical being we including the one XXth quarter, the recognized recognitions notable earned most the consecutive year,

let results. that, Don our me ask and to provide With on Don? details more performance

Don Templin

Thank you, Heather.

quarter. $X.XX first operating quarter. in the in turn share of compares let's to results the $X.XX slide Now earnings our adjusted on This to year delivered prior X.We per

first operating quarter share per XXXX earnings $X.XX. impacts, Excluding was notable adjusted

solutions, operating favorable on Management. and impacts adjusted spread in profitable in underwriting solutions, AllianzGI our health in all wealth net by highlighted reflect Investment favorable results higher Our experience investment growth businesses

GAAP $XX Benefitfocus recent net was integration continued million quarter income This AllianzGI. of from our of included million. impacts approximately and $XX First of acquisition cash

us illustrate navigate conditions. enable revenue results streams businesses diverse how to our through our to complementary economic challenging and continue Overall,

Solutions to Wealth slide on XX. Turning

outcomes cash and value with grow to values. deliver generate supporting long consistent positive is We our customers our over vision to the and this net continuing improve clients turn, In are and for flows and assets our term. ability

net full inflows billion over the As five shown of generated service nearly we past years. have here, $X

case surrenders, basis, deposits we participants to on full Full trailing higher above departure a feel full a continue we service While be growth year XX%. good expect first and XXXX. impacted X.X% to remainder the for our quarter XX-month grew pipeline inflows and were deposit about service by large of recurring

slide $XXX generated Wealth operating Solutions in quarter. million to first adjusted of XX, earnings the Moving

alternative rates more were operating the customers. impact anticipate our earnings environment rate of Net further ex average the raised $XXX on In the million. quarter, rates the crediting unfavorable to block. actions notables higher of spread on equity income, benefit benefits on We are of enforce pass basis. the we part adjusted than reflected revenues, lower markets. XX-month interest to our This Excluding grew rate revenues, trailing based of X.X% higher a offset which on

XX.X% Going on expect we ex spread with trailing forward, quarter. the margin consistent investment to second notables. quarter operating basis XX-month Adjusted a be net first was

were unchanged. While expense in year quarter outlook full expenses administrative due the to elevated our remains and spend, seasonal related timing

plan Solutions diversified targets. across industries codes. diversification Wealth well business tax is revenue Our This and confidence forward us margin sizes, gives and our looking in

XX. of the on Turning has Health enabled pricing and across remain target to enforce XX% discipline long grow above to our service excellent Solutions our us term. over annualized premiums X% focused slide We to business. This

favorable saw premiums the first higher growth Excluding retention. by in quarter lines We Benefitfocus, supported enforced across year-over-year. XX%. all product annualized were

returning underwriting was will further XX-month favorable voluntary. on aggregate in Group was loss a Life pre-COVID a loss tailwind. be and to due XX% Our ratio stop This trailing basis. total levels net primarily to

We than of expect term ratios XX% long full our target to to loss year be lower XX%. range

business grew ex XX. notables operating Health first on Adjusted based XX.X% Moving earnings. basis ex XX- basis. and in notables. growth quarter, of to trailing revenues. results million of trailing slide addition was exceptional net XX.X% a Solutions This month Benefitfocus’s operating revenues from margin adjusted the delivered core on the generating resulted $XX XX-month fee a

gives margins long differentiated XX% full us growth. target year expect our Together to we brand range. within our value to leading wealth confidence ahead, in our workplace and business, be term Looking with our XX% proposition

slide XX. to generating Investment has market record cycles. of a Moving significant our across multi decade for track different clients value Management

to platform, our have a continued global We significantly in player. and invest to our expanded have capabilities become

a reflecting year onboarding ago, Our total management of the nearly AllianzGI XX% increased assets. assets under from

We cash the over of outpaced this quarter industry, term. have growth first has the our consistently flows generated long year. organic meaningful net the And including

net experience flows international by positive we our generated and supported net outflows first the did we While quarter, distribution. retail in

the see institutional channel demand. business strong to insurance continues Additionally,

flows, Although, the challenging continue backdrop to growth start quarter X% slower we expect in to has X% organic first resulted to in a XXXX.

Looking expansion alternative growth the beyond this the opportunities capabilities. private excited and about in year, are and we in distribution international our continued

operating $XX delivered revenues basis. trailing Net interest. addition notables Investment net Management The earnings first XX. XX.X% AllianzGI’s of Turning adjusted operating million XX-month a in the a quarter, on quarter, ex of elevated notables to the from grew benefit margin timing non-controlling slide seasonal macro by In impacts assets and basis, AllianzGI of XX.X%. partly first to adjusted on trailing expenses On XX-month was quarter was impacts. the fees. due were higher offset ex

to there expectations However, change is full on expenses. no our year

We full on at XXXX continue basis basis. by market improve to points margins least a expect XXX to year neutral

Turning to slide XX.

returns. light, that a flow and robust each us healthy with shareholders. through financial high cash will flow that capital supports include cycle position, quality to is well our We a It strong and ratios excess highlights risk sheet Key quarter which high of the capital by with our to facilitates attractive model. model. free have cash high and a provides free A portfolio cash balance adjusted business strong coverage investment capital flexibility the return light, position leverage liquidity replenished continue deliver diversified capital

Turning XX. to slide

diversified account across general Our cycles. well well market should perform

has disciplined of required through expertise. investment risk and balancing specific is Our the process our decades And on focused deep cycle. business team adjusted sector capital investment returns

is illustrating response with in skews significant of investment quality portfolio the greater with real being across X,XXX It estate, commercial have the maturities our fixed diversification we provided asset across over of issuers. industries high quality, interest classes diversified level additional In in appendix the Our book. and details XX% high to grade.

flow we watch fundamental our confident capital remain tail position, limited capital plan. and our out, look and we excess cash list credit current in risk, free signals credit generation As

to slide Turning XX.

a disciplined our capital approach returning to take to continue to We shareholders.

in deployed approximately will of our XX% flow debt. billion $X.X free of months, plus Over cash we generated May, guidance the last redeem and we hybrid capital. capital XX million with In line $XXX

fund utilize this redemption. We facility P-Cap our to will

an in As annual million continued to increase expect subject XXXX interest $XX stock And approval of nearly save to dividend common a half to approximately annualized conditions. additionally, board macro plan we the yield constructive we to X% expense. second of our of and result,

free We are confidence given our cash do so our flow generation. to in looking

share Finally, plan the quarter resume to we repurchase of second XXXX. in activity

Turning XX. to slide

billion we've in the divesting billion, including $X.X $X.X billion repurchases. generated share capital billion capital of form deployed $X.X intensive since capital XXXX. generated, XXXX in and businesses both of have including $X.X XXXX released We Of from we the

by supported capital been Our generate ability has consistent transition the flow and diversity revenue to to over of light more cash time. our the businesses XX% above sources,

Turning to slide XX.

In terms earnings, this expectations not full have of growth, earlier about and capital our XXXX communicated cash generation year, operating we plan outlook, the changed. year adjusted our

In remain XXXX. in XX% our track addition, we achieve year three growth adjusted operating target ending EPS on over the XX% to period, of to

is commercial our half execution dividend we squarely businesses, us repurchase second acquired plans, enables and XXXX. and all the the to a that businesses focus across capital resume activity to continued year. And Our target our in on in the quarter, over our share increase second further momentum our confidence of of in integrate generation driving continuing last the

will so that take can the operator With that, the call questions. turn your back we I to

Operator

[Operator Instructions]

Suneet Kamath Jefferies. with

Suneet Kamath

get capital on just and little a remain to this in technical. market deck constructive unpack wanted morning, assuming But phrase, bit. I to few Good you've I management. the conditions that don’t want a used times Thanks. too just

the equity need you resume make we're question Thanks. all credit looking side, is buybacks to that expectations. level what for Is market You're want I side? it not setting to would to on in on just the happen? Is guess XQ at it see the sure so

Heather Lavallee

Good your question. Don take morning, Suneet. will

Don Templin

we of resuming really headwinds, Sure. in repurchase the I confident about ability really, $XXX confident And to guess really, we excess where macro we we quarter. capital. our there share in quarter, some our statement the one, generate our, would in capital environment feel during generated say second really feel were million an in

Suneet Kamath

And the of any buyback expect for size in we that should XQ? terms

Don Templin

or also guidance, of guided that an EPS year So EPS a assumption at forecast for had it in guidance repurchase. in that included the sort the we sort of around beginning of the guidance, included share earnings year, embedded was and provided

since changed guidance. we around Our expectations not share have original repurchase that provided

targeting resuming a business We share of generate continue it and actually we repurchase light to capital second year. about would And half is gives really us dividend also well very that's performing capital; markets expected confidence do. the in what our increase the as in the

Suneet Kamath

the That the full it just service one is on makes then business. second just sense. And

surrenders little you bit your mentioned think, elevated. were that I in had comments Don, a

you're credit was. Just actions there up I you're are limit curious taking? the going rates you what driver that but going taking think actions And that there that to talked about forward.

Heather Lavallee

Yes, thank question. take we'll your Suneet. Rob, you,

Rob Grubka

Yes.

full feel we numbers is the perspective, of strong overall, full within service full provide plan from left marketplace. and service on really good the a side, you're the perspective. that there that flow during So you exempt, about we the the explains a at what I'd in more a that corporate look in in just most the really story end year from of ’XX tax tax ‘XX call you'll out service it's, to the larger as the delta exempt, even a you going look as see as noted, flow And story reminder, say, which particular really often between as

in is element the And flow and stories call been is quarter-to-quarter, and larger it think it's indicator just part tremendous. in I bit smaller what about and step and the some the move running But the year, term we've balance seeing, But we're what momentum you view But of about But year that to can a have I story record obviously, five something year, so here the I the see And when do when and said, lumpiness accountability back. item years the as five flows, last about feel is the our to tax exempt, tax the the That's That's full of the trailing it us really Last back seeing long and and activity as great mind a been of market, has year. just to Really lumpiness, different. $X part our of think little within sort of way I you we a market. exempt. keep last long where talk you there term going an good corporate for we're forward, they of mid look billion where got good. have again forward will that as to going going, there's much in they our when about hurt an we're cases, is then the is there, very about come activity it's has confidence bit they're good be. they the months go. momentum, we why continue be of feeling noise. good just XX that little

Operator

come of the with Barnidge John next Our questions Sandler. Piper line from

John Barnidge

the being better Thank you perspective. and in know talked new you distribution maybe a earlier very pipeline Can about in for launch morning. Appreciate the talk products Thank worse about I usage from management? you good anticipated much. it's where you. four investment areas ’XX and

Heather Lavallee

Christine, John. take very your Thanks, question. will happily

Christine Hurtsellers

to talk the Certainly, pipeline. love John, about

see, to you a organic challenging now, we're very X%, what still X% macroenvironment XXXX. right rate diverse. affirming strong I that with for And our starting despite call growth So would

to advantage it opportunity right seeing have offerings. credit strength, be, of that like in as, when of And say, do to banking notably, as are a would long to expand we about those borrowers we our the covenant investment want, going is opportunities, you underwriting And as a rockier negative really the product the when we able of the clients manage and the of do gets strong so delivering things some now as we're of little production. notable really run see for clients, where think grade, macroenvironment examples credit and the assurance provide we well I being protection, quality can do, with our the as industry see take as on private

opportunity is we're that that And retail seeing would global shoots in we're stronger certainly of rest the were really our saw be comes the of strengthen cash year, domestically, much Also first we're for just reach So again, one in than and where green you this is as Asia result quarter. of seeing currently example although an our the we diversification positive retail, XX domestically momentum. demand flows the the seeing year. and

of we we with quarter. like a think remember see have first strength turmoil from sediment But organic said. well. were countries we as XXX clients really about product the offerings, in when And to our lot impacted growth deliver about So we globally, be that XX this of confident in we now year overall, the targets the that lot just to a of our our that in opportunity partners, the AllianzGI, you we really salespeople diversification feel market, will talk that despite just

John Barnidge

Thank in interest market near impacts Is And sustainability that seemed a then you Thank light term experienced. strong Can You're term? you. capital talk savings? those of much. that were you expense the generation about very the talking really question maybe near that? of by enhanced challenging some on about of

Heather Lavallee

Don?

Don Templin

Yes, sure, John.

we we have talking we currently. where the in generation very internally actions; has over to what to our think I capital do, been number team very, taken a us wanted management We've been are the of about position years capability. confident

delivered provided real scenarios, during to information confidence I cycles, different that what under plus hopefully market cash you generation. we some about wanted in the in and think do, gave that we we deck have XX% consistently various

business with going historical do And new strong gives capital the perspective forward. us to in ability confidence so that light really the that our

about expense. asked you Now, I interest think also

interest. this number month, X.X% to you'll I debt, so on hit hybrid going hybrid that to was and let hybrid or X.X% was some reset interest approximately that the we just over resetting kind if interest to of on debt, expense that had that take So me that recall going point, could, debt

really business minimize of replacing to that rate, something debt put XXXX scenario. a senior that we to we try impact to X% different a debt type in interest issue interest a increase was was interest prudent it available will to a rate, in code. We we facility the zip X.X% was P-Cap So use really the essentially facility, in for very to But us, do place be into expense. in the that to going will that that felt have hybrid significant of had support

observe expenses. all, managing just I think that was the this our So that hybrid replacing to outstanding we at we change a move debt debt sure senior prudent is also it all we're doing make debt. our new might doesn't really were with that

reduction debt, So to there's deployment capital the the of debt. new no reduction the debt quarter. It's there's really facility funding debt, of reduce no of new this funding the with or just

Heather Lavallee

XXX%, And I is interest maybe John, I talking is bigger in $XX if I of on if our deployment. dividend generation, was to our voice expense the our Don add XX% save our conversion, million free both me, can the but to just flow to the ability in to increase that over as investors’ in and of important. our cash confidence by immediacy cash drive to and can hopefully our announcement intent capital evidenced commercial flow give really think confidence about momentum, But the

Operator

Jimmy Our JPMorgan. from line the question comes Bhullar next with of

Jimmy Bhullar

Hi.

in but if there Don expenses, on in you I implying bit a what Because you or gives versus First, question be drove level more of someone future uptick? you're XQ? consistency the decline significant be give should periods? decline a in quarter. And may they'll that on exactly sort expenses some confidence assume of What just XQ could this the us little the the color for else

Don Templin

question. that for you thank Jimmy, Yes,

experience So expenses. we always seasonal

the by exception, This impacted obviously of things. was the of first quarter no a number was quarter was but increase magnitude

of point position growth increased in proud So are our things One, two of let seasonality the growing also but increase important. we growing and a in are think me kind of that we're our that being business, expenses. the I business business, we're just in impacts the the that

the first a AllianzGI, offers. But to what in of quarter transaction for us. first it So bring the obviously, some I compared to fantastic that's mean, been example expenses be quarter when XXXX, of increased excited XXXX. it We're a really really good would did about seasonality

that about in very customers, talking Rob, in happened being we're both on and expenses were customers, about Christine are we of marketing of thing quarter sort where pipeline, loading our really out this other very, building being confidence are confidence The and by get the is in intentional ourselves. front pipeline, building a front that the focused

what's of So we remainder this in could some incurred intentional, and going that about of that expenses in quarter so happen our very XXXX. we were gain XXXX to confidence the

the around management. investment In both guidance, deck, quarter second for the then provided there's wealth earnings in materials that we solutions the and

second So second about less we investment $XX about for guiding less were quarter and that million $XX $XX would the wealth solutions, in quarter to million expenses million be to for management. for million $XX the

be reduction You have basically on opposed quarter second probably included should in that. of the those through to assume the the year, remainder said that we could for we've will as would continue what reductions beyond and

then you the year. should reduced, will quarter, I the second the flat relatively reduced that So significantly and of think assume remainder expenses be for in

Jimmy Bhullar

Okay. ahead. go And then

Heather Lavallee

just you, you the up ask question, Jimmy. to I'm going have follow do

Jimmy Bhullar

you idea Yes, possibility trying environment confidence I there forward, on part have to the institutional of is sort is assuming comments some asset But just of the guidance fund, about, been going going environment that management, X% this do is was quarter uncertain that your to mandates positive given so the had organic into get that I on the in overall, an just pipeline think the and just negative your well. for ask as flows of I'm a there positive and X% not they're and growth? to

Heather Lavallee

will Thank take you, Christine that.

Christine Hurtsellers

had, situation the quarter. bit do the in addition look negative. a first when of to reasonable the to were flows, and in first a were they our the is have and in macroenvironment, about, on in existing Yes, quarter first Because Europe. off institutional call the in thank unique first of which about a overall relationships that at we explain the what related you quarter, talk clients portion institutional either distribution, ramp we that so Certainly, let so you. ramp of that happened we've me let's that And talked we Japan were in or outflows international

I our that the if thing certainly the from partner strategic really NNIP, away and will, headwind for manifest coming distribution from of second Allianz product have with ramp this when XXXX. we to that you is on think more the is And think new likely So of you natural evolution into is Allianz. to ‘XX, the half itself

flows. a of the strategies North lot we the when it I of point, as goes five some there, rated got we the flows performance is is America, income transaction, well. I'd our that to X% Voya. slowdown So it's But And built have rate. to from retail sort our unique call delivering, that, you demand of just confidence and But sense a something then that some within seen we give particular commercial beyond into organic the growth is our expect, star growth X%, think and that just what real which we in to new estate be deliver yield strategies, of franchise our would into as again, of environment also the credit a it given exceptional attractiveness that we've we're seeing the outperformed But demand factored just overall, of as headwind the institutional quality to in formidable. institutional about strategy onboarded a another and you strengths funds competitors, production, cash that AllianzGI well reference the potential mean, our increasing as seen, you've and of morning to

Operator

question Credit comes from next line Suisse. Andrew with Our the of Kligerman

Andrew Kligerman

Hey, morning. good

as then what going as around the First thinking dividend forward? you made question to going X% the X.X%? about to nice dividend think frame I'm curious or X%. Like, opposed are in to is what the was at up you And X%, the there? move how to it

Heather Lavallee

investors more for good I and getting us follow was we level new with Yes, Andrew, a growth. morning. part and our value peer level we let it on. to let it and me to elaborate. looking I'll attract really on equal of mean Don, that also And a believe believe a the and footing But start maybe Don companies sector, to ask, would in others that put

Don Templin

that that what about I going to then what about question I articulated think we think so trying Yes, are thinking are you Heather backdrop and is the forward. ask accomplish we the

make want that a to then increase to sure have increasing competitive dividend an over And do but are affordable think is we want appropriately we level that on level, to that us biases need not incremental sure increases to that dividend. we to the that So that, and organization. to make be our gets stress what time, X% we put those

we repurchases. future firm. of reducing the by we fund ways, going it one share share fund dividend two are increases then the in growth capacity count So to the through by natural that we're And by secondly, the going to acquired,

put undue on but So in increases the a don't are to stress sure that we that want the organization. make we able grows over time, dividend to have competitive dividend the that

going going number through fund it we're are of shares growth, that to organic a fund reduction we So the through and are to it outstanding. in

Andrew Kligerman

appendix. that question how it's clients. get in mean, I you those you first weighted really with mark the I've X% LTV at I the just an lot of been a from portfolio. have quarter. having, some good office enough XX%, discovery lot LTVs? portfolios I And commercial question the a portfolio you've average sense. the only like that looks commercial loan the In then Makes particular, good in got looking of numbers. and and But of one is, is even LTVs? be of these comfortable accurate this end really are is But at the those Voya to them there beyond suspect slides

is thinking as what So around to I'm curious that. Voya’s

Heather Lavallee

will And Christine question. Great Andrew. thanks, it. address Yes,

Christine Hurtsellers

Yes, absolutely.

see you for commercial portfolio, loan So the their you when look at LTVs Right. XX%.

So very high quality, very competitive.

portfolio, we our far not as if question, number more out your those as see $XXX terms loan and go at diverse you a regular a lot get loans, take to look on NII a of you do external million. it's And no in basis. it, appraisals, Now have above and of we

and very get practical, every isn't go to of and lots loans, year. expensive very diversified, external lots just be think So ratings

time the at at flows a origination. cash of office them get do do annual and quarterly minimum flows. for we cash So get We

internally, is the the so great team And loans vigor. underwriting with re

feel we we we overall So a have really to another of mention it, loans. lot great amortizing do thing not include, about

you think you're XX% properties when The real I thing so last say delivering. you fact want leave commercial is about So estate. about are debt. to to I that, portfolio naturally the relative the this is about feel not confident with, that LTV, that our would of And I capturing

first, a happens, matter we your are So hit debt if LTV, gets and equity about or what property lender. something dark, no think a goes

story classes more way own of cooking, we're we disclose delivering, you we're portfolio trust we one clients asset our we delinquencies our momentum tell gets the loan but So power you performance rough. about where a portfolio capital what I'm estate statistics, you eat stack. our manage then going for so we along companies We of insurance And clean commercial the well think a very about really over plug, forgive and private and gain call clients. partner, club, our beside the them, that in in assets beyond really manage the I going give the when we and when are assets to of remember, for. And clients, real me on And to no can't invest XX When the them. estate to thank world you real final the no, much, you our for think question external we today. the the goes great and commercial everyone I'm have

in share with delivering is we look see and can come. pay to at that's you are And for and years that our the I when that dividends going the so Voya, to And general we're we're how flows relationship market for building confident think account, clients. you

Operator

Research. of Our coming from next the line question Autonomous Bass with Erik is

Erik Bass

you. Hi. Thank

the First growth one EPS ‘XX on your from your for to to EPS outlook. In point $X.XX. moved starting $X.XX ‘XX, outlook down

for on the impact still the you're guiding to Given of to starting the EPS. Is and it material CAGR. point XX% impact a what LDTI, have movement does implies a XXXX but XX% growth

being should your as goal the the end of growth more So higher think range lower starting we and about now point? given the

Don Templin

sort it's are deal we of to prior a recasting that unfortunate with it's then new And Erik, numbers. periods, so have and LDTI. the from Yes, measurements

let's to if as we you to real you going in increase, But sort changed. has how of feel LDTI reconfirming me, of our and recast, we beginning for the we three about XX% performance and that sort focus were before business. here confidence that of year give year at period in can just XX% the guiding forward, absolute around the allow maybe the So it EPS outlook Nothing the from well. some

has earnings we changed. to deliver So were our around view adjusted operating in going that XXXX not

earnings going operating deliver XXXX were adjusted Our view around to not changed. in that we has the

shares Our view of the capital around changed. were do that we plan, XXXX repurchase going in not has to

around view changed. that not Our has XXXX in

of were some the result a good the of there's dilution of noise priced of that's There's underlying one they the really as been sort know business. So warrant bit little is also really, feel because those month. we And of things the about expiration, is the noise a you in that And LDTI. there because mid-XXs. of expire warrants, happened this

so an dilution, that the about And share had we would about We it's forecasts that's it that mid-XXs calculation. EPS sensitivities our for nothing think it our our increasing A in price, price dilution. beginning very We million to the million because remain share think has guidance relates price But confident of the our you'll business, by historically, in the stock year. that's and We impact provided shares X good gave core really impacted at improved. But have we denominator investors. good. the XX some is of a mid-XXs has as has having shares changed. recall stock price it's of

Erik Bass

the you experience? going XX% margins do what's are to XQ strong favorable is to ratio business. term? running color, benefits I then if XX%? just or just that for the Is the in below guidance about maybe It's asked to exceed expectations related you. outlook think health near to the And just guess That Or that? and helpful your driving Thank come so, to continue

Heather Lavallee

the Erik. Yes, thanks for that. will question, take Rob

Rob Grubka

what No, driven the XQ. what we below absolutely saw we on guide, expected would the by is have

back you if at step the think look just products. I and

where the on Just experiences ends we're the the get see in as underwriting lot will every the like, pressure competition all market, things future. going year the look market, in ratio to a to a what practice the we put those and reminder, stop loss loss, up

bn, risk, first think of As view. XX perspective where reinsure feel term how what would about reminder, stop But that, a We particular plays in there's we of life we'll quarter, it That's okay, keep In is answer. obviously, answer. see continue I'd says sort good nothing here XX at. of we just as as to of the foundation world, itself obviously, for and a about rest long great XX bulk we life and term year similar don't now that today, disability the the right you it. again, we our a the bn the sit we loss, XX give shouldn't of long out. about to there the think from the disability think again, to we

be a First higher come supplemental we of nuanced mortality to that last life, a more And then well We've good a on more make those for side makes there. think integration that growing consumer think XX end as usage where the to us in then easier, to But the typical and about XQ long and the to again, of still continue bit value just exactly think play a But handful ratio, started. we quarter, into as the continue view, would we we yes, just full And driver as expect the the word. done environment. range not XX claims normalized sense, doing to claims here, Maybe loss cases trying simpler, the term big to we performed to above bit of competition a given you part put trying what we've on experienced established. we to do of revert view, right we're to business. where think XX. job value a little for again, or things and good typical end perspective that benefits up that, improve voluntary from you'd the just is that forward of momentum the of things, is we're to maturing the products, expect market improve that to back want upward years. going we and is that experience, customer from as But to about there be process it and to those a and back have year where really over the health come provide. will products renewal that a

Operator

questions next Joshua America. of Our come with line from Bank of the Shanker

Joshua Shanker

was the Yes. quarter I I'm were just joining wanted of Or investment them transaction? And one And Allianz late, [Inaudible] about expenses. calls down. today. the that to we the conference are Jimmy is to about talked the XQ sorry, clarify the asking about a time management what frontload in need you think expenses? do nature expense going they for in those lot ‘XX? in

Heather Lavallee

offer Thanks, Josh. Don follow will start and some Christine, on.

Don Templin

both expenses sort in Yes, are AllianzGI the actually onetime really of earnings, those expenses. would and the our generally acquisition so to are those That's in related nonoperating Benefitfocus -- be the adjusted expenses. recurring operating

base So bigger. is our

XXXX to next base manifest same when year itself. XQ, in will XQ, you're increase Our XXXX size that comparing

nonoperating, the are relates around stuff earnings. the So the the adjusted in are or below our operating operations acquisitions the that and stuff integration normal line to

Joshua Shanker

seasonality results And time. recurring will so anticipate shouldn't we a feature of be over the your management investment

Don Templin

correct. Right,

Christine Hurtsellers

bit me will, is investment add specifically. little management just And color, this Christine. more if to Josh, you let Yes. a

we've very is sense really the as transactions, domestic that to can of streamline to a really the vigorous managing staff? And And the as mean some occurred Allianz continue consolidate of want where's by impacts, hands And terms so investment are are continue evaluate Don we transaction know, what firmly do I there gone offer. you synergies globally that expenses. we just now capabilities, does focused, we're covered we reduce of have that to when hard, But some very wheel. be I say, So I on products, and to this business Where the investment very in reflect some to think expense mean, result therefore seasonal expenses, to the it about we, of cetera. in overall we it's et given, rather just scaled? front where products make from our we working certainly

to operating that And I know of organic affirming wanted So we we're you strategies that growth is as put as our we're also affirming part And highest margin up our course, behind prudent money free with looking continue a story expansion, target of important to capacity just growth. very being also our our very expenses. opportunities for there, markets. to private our such

Heather Lavallee

Benefitfocus, point, both and expect with it track we're right Don to one the just it look it of I'll integration add toss where our toss AllianzGI as as on back just I'll on give with to second, maybe costs. a forward bit be integrations little Josh, we well to a with then to but for Don, a

Don Templin

the that closing Benefitfocus those quarter expenses million, be expect attributable of number. this less is that AllianzGI. primarily be of next quarter, there. to had this and number about core We expenses both current talked integration half would We in about the we so will of transaction, would seasonal than nonoperating $XX operations and Yes, Benefitfocus the

be and will integrations, of are those So to off reducing sort related recur they the costs, annually. those the seasonal transaction but those will closings, one cost meaningfully,

Operator

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

Ryan Krueger

had on the largely customers? higher I your know second within. I about in from upside through being you it morning. spread should passed guess general, Well, interest flat being income Good about a to pretty I from think that additional rates in here, with thanks. question quarter. we Hey, talked being flat

Rob Grubka

Yes.

expect or dollar on you've right. to zip to of set that code that again, from income. a heard just that spread level be the XQ think to We'd in I XQ, got

insight the much we look when more there's certainly implied view the put are be information. we're adding all one, better market will we've go to a got in and in have of And crediting one, out And but get can tended it We're of place, make our where we those those also those We get factored some where forward and we and understanding feedback decision year around is and the fixed a movement into will time another move started with of for to we has five, the in. just what things that point in we role obviously As and the plays we future. behaving. movement as making money how of rate control portfolio can the in on what control a decisions account decisions, be making that one. as effective sorts competitor move

trying information do strike preservation to XQ that in the share we're So we of thing feel the is to look, have calls further to and movement continue to margin value, will as the future. thinking old good and clear, XQ think balance customer age again from I and about,

Operator

Evercore. come from next is Tom with Gallagher the question of line Our

Tom Gallagher

let’s on charge some and get to certain, return that investments, like it's cases today, can And I spread. north the investment with just on thing have for morning. where your and that a of one you me, a get I assuming is the made out capital I it's of I X% to sense Good guess much to question And that this, a most little much and you just were side, higher get X% income or my allocation a high charge. total XX% can of compare that's say believe asset X% private had I on class, equity question But on a the is side, X%. to look low bit relatively allocation. maybe Voya X% what that when portfolio. of when your assumed risk, you consider investment of can low. fixed lot it your that in the probably is is rates disclosure, capital you at LP not X% equities I capital about your it If stands

But for Like from money considering alternatives? a it does question. charge when long the relative make sorry, you allocation the sense down that, to new and right risk about I'm now, difference perspective, into lead return? the question, my in pivot to that think So winded just shrink to

Heather Lavallee

We'll Christine? our private overall, the Christine But account. actually general very in elaborate. allocation have with comfortable we're

Christine Hurtsellers

has it's think taking a grade look overall at portfolio the when about just our of you level mean, the percentage I assets incredibly you investment investment back is Yes, of that step when grade. strong

that, let's one, we and private long so industry. certainly relative you equity talk diversified underweight have to well in the Number run and we're two, book, as highly And X% primary of strategy. Number the you invest secondary, about so the book, invest creation. allocations, within this value for as allocations

time, so secondary think but for at that point And the is particularly money side. in money drawn down not when you on one time, over deployed, and Pomona us about invest

if just because public classes. a pricing So again, about think asset sold quickly, and great private creation, listen, relative asset it's classes typically outperform there's in classes handily to access public, opportunities, to you public, diversification, private so last demand so as and but duration adjustment value off asset of over priced terms well where year, as time

that So we see don't changing. is

filters portfolio, have that it And to confidence analysis, our with into the and asset we our very comfortable, are just clean, planning reaffirm we thoughts scenario we high very grade all about a we happy saying, were good very allocation. quality. want capital investment we're So

Tom Gallagher

change I no Christine, so what to lower, that is hear, fair? alternatives the to Okay, allocation is

Christine Hurtsellers

would portfolio, That's is thing. fair. dry good I in having terms overall the almost I would when powder we context us in you deploy where generally, I think the put a of of of mean, say this and of could overall, terms

in investor going As Portfolio you sheet an an a investor, clean really love into balance cycles with as opportunities.

Tom Gallagher

guess of know CRE but percent my follow commercial kind look I a loans Voya, is in more CMBS. much gone up, for just little BBB, thing that's bit mortgage And wide. you larger that BBB out I and portfolio. have one is were you tiny your pretty have on flown spreads where a before, The asked they stands at of I exposure the that about out And to and

that we that something portfolio? is be your or help expectation Just perspective have for? on Do of appreciated? there? any outlook Any what on you should curious that would Is be watching losses

Christine Hurtsellers

certainly. Yes,

So good you've in embedded got there. really a questions couple

off start portfolio. me CMBS the let So with

when strong at covenant predominantly to the is as really, you investment higher be I kinds company, in capital you debt exposure about quality slide us BBB. towards say that our I at a BBB's. BBB it's, BBB credit, service and are minus private love BBB BBB and about take you concerning we our coverage we with you we've looking because the real there's can would you're so so only BBB's of there, and it's when would due BBB’s When you not got a we're we've and history, tell for detail Why credit downgrade private and tilt negotiate get quality management, concerns ratios, covenant protection, our intentional, and quality exposure, have you we very of quarter in risk when going And that have, because want think have you all to first. Right? credit than you our our you and what when what way gets think So the a that overall, had a would very the when protection see is be BBB think now, credit to a presentation to in better XX portfolio, some performance home. it, on world gets dark of on we look corporate there world can dark this lot see a

that you very agency broke that we're that, out about think overall portfolios, for level of actually we specifically, confident at of a that, and when overall, with we So lot within And when risk. our look CMBS backed is you. our

in idiosyncratic stand. night, it's we're portfolio that where for overall So in quality, certainly the very high have again, view whether we but can go or generally, confident the portfolio things overall, as we that you bump some

Operator

turn session. Heather back over to question-and-answer our now would I concludes closing call any conference remarks. the This to for like Lavallee

Heather Lavallee

acquisitions, will capital strategy, our will day. our dividend on we on forward drive customers and focus also on our management, progress. on value. yield, look achieving clients momentum. continued our and needs share creating objectives. to you We prudent ahead, shareholder and will our focus increase plans our and on support commercial resume you And repurchases Thank including our to further good updating growth of Looking the continue our The focus our integrate our execute to

Operator

Thank today's has presentation. attending for now conference you The concluded.

You disconnect. may now

Voya Financial (VOYA) 3 May 232023 Q1 Earnings call transcript