AFL - Earnings call transcript Q1 2024

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Operator

Good day, and welcome to the Aflac Incorporated First Quarter 2024 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to David Young, Vice President, Investor and Rating Agency Relations. Please go ahead.

David Young

Good morning, and welcome. here earlier being start our for time. you a than bit usual Thank Amos, President operations CEO will morning, Chairman, This Dan and the States. overview our and provide of of results Japan and in United an Incorporated, Aflac investors.aflac.com, with and financial also Then of Max's will materials addressed including our results in Aflac on supplement and capital posted CFO and Max the update Vice current update. an our liquidity. These video Incorporated, and Executive financial Broden, on earnings President release provide topics quarterly we are

We also updated and related commercial posted under the same estate Financials to slides site, on middle real details of loans. market investment our

International; For Life Investment Aflac Q&A Lake, Investments. Director, Officer, Brad Chairman Japan; joined by we Aflac and Global also Representative and Chief U.S.; Koide, Director, Representative Virgil Masatoshi Miller, Insurance Dyslin, President Aflac Charles President are President Global and Aflac of of of today, President

this securities the some within teleconference statements forward-looking we Before laws. in begin, are federal of meaning

believe on these to be could Although We to results. prove some materially our can nature. prospective discuss they are those materially assurance because the Actual factors for report we look will statements in no risk you from we we annual that today. could they accurate Form differ that are XX-K encourage reasonable, results of at give various our impact

available hand and includes investors.aflac.com non-U.S. now release reconciliations on measures. I'll over the call As is I to earnings earlier, mentioned certain GAAP Dan. the of

Daniel Amos

hour. Thank glad joined you, you us at David, and this earlier morning, good we're and

and earnings in On adjusted to start younger up were Incorporated were corporate sales. be for per of marked in we but of XXXX, The success agencies delivered launch marketing this to encouraged September X.X% result. proved an Japan, terms the have individuals. $X.XX. share diluted earnings especially insurance product, Aflac good quarter that in a diluted share by year to for earnings independent the the Net the individual quarter basis, had latest are with medical first our $X.XX. Beginning another solid per for challenging earnings,

However, so. through launch however, we through increase Japan channel. final modestly we entered Post better year-over-year April our to Post insurance cancer and of sales progress sales, We Japan insurance better insurance the XXXX saw on year-over-year. significant doing need the new were in make stage channel, and in clearly plan a while cancer of Cancer understandable

cross-sell customers insurance expect improvement We to the Post Aflac our insurance remains fiscal buy start see with new in life along want important the they to year an element strategy where of Being product. with new Japan of the as cancer insurance Japan. growth

optimize of financial Our alliance to partners protection including banks, provide continually broad network to agencies, distribution opportunities and Japanese channels, help consumers.

hard work to to continue support each will We channel.

starting quarter. addition, In in around our sales initiating are we Japan XXth this anniversary campaigns

and not have we XXXX for clear, be our me expect Let sales to lowered still achieve it. outlook

this With the and objective. Koide-san achieving are launch of the team new his quarter, hard policy that working

to XX.X%. In we pretax have expense and of strong underwriting profit margins maintained continue management addition, driving disciplined

Turning U.S. to the

generate first years, As lowest you've quarter of seen year. the tends prior sales to the in the

growth profitable stronger underwriting more by driving on exercising focused have We a discipline.

profitable to deliberately are accounts. certain avoiding sales less opportunities We

continue same policyholders. of While are policies to value which benefits. positive cases will improve We seeing certain this temporary benefits impact and appears to on in in net for the realize earned related customers improve the X.X%. At sales to premium have first quarter, believe results the grew in as a persistency the value their increased we the we growth, have time,

before or Japan States. has improvement XX United we the with in in ever stronger it is and persistency believe both the this We basis quarter. that been are I offer products need strong for points pleased the as than the

sales of end we as momentum to our restore $X.X to aim continue and reinforce position billion leading of the work to by XXXX. our We exceed

We disciplined also our expense have to approach management. continued

We markets scale. to and consumer disability are ratio and expense group our life in progress see grow on continue in to beginning

We stronger same management. are and the of I'm addressing Max defend our team led in Bermuda. we strong against growth, to on and half deployable continuing focus establishment year. expense Overall, a proactive our Yen Virgil and our our to see balance of take second with with to to how and XX%. cash expect value optimizing of liquidity a and the curb on time, like very At to this have sales ongoing end maintained has and the our of as the very doing pretax years proposition what in ratio. I'd pleased vision enhance dental policyholders flows platform margin the are I'm his team commitment prudent to profitable capital reinsurance weakening to pleased steps as recent capital well platform the

balanced the to ratios capital and strength the shareholders. We We maintaining is approach As of long-term continue and growth treasure both to efficiencies. the and remain our with record dividend in and $X.XX fulfill driving committed intend set the being policyholders. continue company, strength it. supports dividend record of track share $X.XX. the to first our our to an I increased deployment. capital shares capital investing financial extending our a our of liquidity while managing strong quarter insurance we the million pleased XX% of on to dividend this operating it flows. the a the of consecutive to tactical primary capital We We record, promises on balance and first this This repurchased $XXX in and preserve prudently track Board second responsive continue our repurchase. We of to quarter XXXX the in growth tactical intend to our that and years tactical cash and when responsibility declared dividend path remain make us our of record committed am XX policyholders needs behalf to to quarter

of just our we XXXX, us underpins promised. This supplemental stewards traded to Our our of year goal dedicated in Stock with York our and in New the sales best on the of XXth United business, doing there and company products when the providing need policyholders publicly celebrated Exchange. Japan. employees States be our being year management and as value most, team, in customers a for continue they business XXth in the as we Japan distribution In

complex our healthcare We products the our in We environment ever life to best makes founding our us has Aflac that the insurance that turn are offering on to the work reminded more toward incredible with We promise world, continued like that we It's to results. growth advances well than Max? in the ensuring to and come medical potential program one a of while as in policyholders. I'd partner. has achieving thing cost. markets insurance incredible financial now our more underlying changed to produced approach relevant strengths in the believe partner. deliver believe protect and still our two Max positioned we Families business of to the that long-term important Japan over not company have hardships to since U.S., XXXX. is cover that and from not the growth also largest for details of seek financial our even individuals covers. Today's health themselves

Max Broden

you XXXX. for Incorporated's quarter for first update on joining results I the a Aflac of Thank provide me, financial as

with $XX our these declined For In a quarter. FX ran diluted adjusted from decline totaled or share the million JPY and in X.X%, per negative increased variable the as including foreign earned was quarter for expectations. return billion share, cost currency per losses, negative in per $X.XX this earnings book premiums our policies. results our segment. This and solid. quarter, the to remeasurement spread Adjusted $X.XX and an investment with year-over-year X.X $X.XX below we gains view an reflects $XX from share capital. Overall, gains Starting the ROE million Japan impact translation quarter adjusted acceptable quarter, increased X%. X.X% income value impact paid-up to the XX.X%, Net of long-term

XX.X%, total ratio X.X%. Japan's in time, addition, third year-over-year. In liability. the force flat JPY ratio the expectations. and at from within points profit was JPY billion came is positive impact At And internal approximately somewhat X elevated, basis same there XX% impact benefit year-over-year. transactions sector down benefit deferred were our X.X the Lapses billion a for in reinsurance policies quarter, declined from negative a but XX

and XXX treatment basis be be out some experience experience. expected customers to place, their our to actual basis XX down year-over-year, of experience continue to We ratio is to on leading update underwriting change with but and quarter-over-quarter. We the tend relates coverage. continue lapses favorable block. as of to XX.X%, not to refresh large in-force hospitalization, line which to estimate elevations gains to favorable mature well-priced, rate points benefit trends, We This from of flat expectations. a continued persistency cancer XXXX. in in Persistency remained remeasurement favorable with in it was impact Long-term QX the points as and experience solid in

ratio in was and our by FX extent, as the from income XXXX. in investments expense U.S. impact basis control by terms year-over-year, compared points quarter return by up alternatives higher well down allowance driven Our first XX.X%, Japan to good net mainly costs portfolio from XXX lower investment expense favorable some dollar transactions. our in on hedge to terms expense on as yen and yen of primarily Adjusted reinsurance was XX%,

income. lower a leading in This margin pretax The year-over-year, due result. transfer a for up in to quarter offset by rate reinsurance the good asset and the was year, of was very points floating base basis assets XXX the XX.X%, lower previous Japan to

to persistency Net of categories. quarter Turning Persistency premium and stabilization basis X.X%. year-over-year metric a is points falling This to of U.S. product results. numerous function across increased a was out poor up earned the XX XX.X%.

and in the We QX basis basis year by points XXXX, ratio Our impacted that than total ratio the lower by estimate remeasurement driven a higher XX XXX remeasurement in came XX.X%, gains ago. product gains points at the mix benefit benefit quarter. than

has our models, incorporate more have recent utilization reserves. stabilized, some as Claims reserve released we into we experience but

the lower in year-over-year, U.S. Our driven XX primarily acquisition and down scale improving was platforms expense ratio expenses. basis by XX.X%, points

total to basis life their points. by decrease disability, vision network this and to Our these going forward as and direct-to-consumer our We scale grow dental and growth businesses expense profitability. and ratio impact initiatives, expect improve would group increased XXX

a X.X%, pretax yields on both was rate solid and growth our investment U.S. the margin investment premiums by driven of improved segment up year-over-year. higher earned primarily driven U.S. with the net and was alternatives by net in Profitability XX%, portfolios. net income Adjusted mainly in fixed income

remains in estate these real watchlist approximately commercial around $X.X million $XXX with total billion, active proceedings. foreclosure of Our

of As this these these quarter. marks, increased by $XX result a current with our associated loans we CECL reserves valuation million low in

resulted also million gain. estate property X in a $X.X which real into We owned, moved

take to reflect distressed why quality not ability to we of true continue them and ownership intrinsic which the confident assets, these portfolio, market cycle We economic our of is the believe through manage the recoveries. value does in are that current maximize our our

assets a corporate line Our net lower continue due income portfolio than of volume on net and million Inc. losses the an first to at to for $XX loans million, purposes of investments credit well the of point GAAP our was credit this credit higher tax lien, below Aflac In investable investment million. at loss associated income year line. volume investment higher a $X to senior U.S. Aflac impacted perform These tax we for tax negatively market REIT by a with in Corporate the investments recorded segment, cycle. our middle pretax $XX last secured expectations Adjusted well with

in these in million impact $X net date, are and our To our well line quarter. expectations. with was to The the positive investments line bottom performing a

build We the I outcome and are out with our reinsurance am and pleased to platform, performance. continuing

our balance. limited strong well external strong X.X leverage we million of Our finalized, And while roughly the capital impact RBC, position expectations above leverage the at we This and a cycles greater an liquidity we to X,XXX% capital which within SMR combined and than XX%. billion ratios, XX% with release earnings a to is estimate low QX. both Unencumbered JPY and $X.X Japan, FSA ended corridor $XX Adjusted are in billion, our holding billion as as our shocks. U.S. stress minimum above manage at it capital. Japan or company stood withstand be impairments at million. to with monitor, not were were and in statutory comfortable $X credit of end and actively of XX.X%, $X remains quarter remains XXX%. impairments to well These our

with tranches JPY quarter, the in coupon X.XX%. issued In of we XXX.X multiple billion an average

program, We terms. good debt dividends of Japan QX, these we value denominated offering million rate. relative protecting As $XXX Aflac stock in $XXX of hold will approximately movements on dollar IRR in economic own is the paid XX% intentional enterprise fluctuate of hedging in repurchased our yen, and million our capital U.S. deployments. our the with in and of leverage part This our of yen/dollar

flexible we drive We order of strong how tactical sheet so will call in capital. I'll that risk-adjusted David in to capital we over now balance Q&A. a and our to can cost the with deploy turn to ROE be continue manage and our meaningful the begin to spread

David Young

Max. you, Thank

I our on calendars coming December mark for more begin, we Before Exchange. analyst Stock York your just everyone, to have briefing the please remind X financial Instructions]. information at New We'll out. [Operator want

Operator

first The with Greenspan Wells Elyse today from Instructions] question comes [Operator Fargo.

Elyse Greenspan

reaffirm expected longer-term were question, the guys guidance first you with starting that you in U.S. did the weaker than said sales My but sales, for which in quarter, business.

to how U.S. trend sense a us can you the expect here? just So sales in from give you of

Virgil Miller

This is the U.S. Virgil from

with sales start bit little let how on in more First, me color QX. a performed

little they mentioned, QX. couple drivers a bit you that. A for softer for were As of

That our our with Well, that some we is business happen. business First, let an Normally, life, year, that comparison. did in in the That absence a down doesn't therefore, we last disability of me is so XXXX, process start latter with plans, part year. anomaly. were business. QX, place and have the that takes normally

So line the remainder year. the that continued I of for expect performance business of from again, strong

So a that timing was element.

element the and The involved timing other vision on business. dental

in work that continue his optimizing mentioned on Dan we As opening, to platform.

had sales. we softer So

stronger improvements the out We half year second have continue product. build the those of have make a year. in to platform, a We're and dental expecting to that

and will business we close strong which on we're that, pay underwriting I emphasize, bring a building profitability, will to long-term value claims strengthened us with to over on color also return focus has more the shareholder and allows looking continue discipline. with helps has persistency. believe Last, I long-term -- us on This though, to our that company range. to give To on really

-- persistency in do quarter. points. have had strong we XX% We we an and margin XX% So of profit higher had of the basis earned premium improvement of in of XX X.X% profitability

So manage is to the this the going we way forward. believe company rightly

Elyse Greenspan

to in my Japan. then And shifting follow-up, sales

this The went sales third negative sector quarter.

Japan. of some trend you But you initiatives hoping you to color more highlight did the sales guys to You over on in just the sector specifically could have how improve sales course XXXX. expect provide third

Daniel Amos

think we Aflac to that, me let the most expect objective full year. answer the for is Let attain Japan I but important still thing our

you Koide, taking or So would that mind Yoshizumi.

Koichiro Yoshizumi

hired in and mean to sales I associates' approximately will we This for question. sales enhance [interpreted] XXXX, answering training. Thank your you the be Due we question. sales we are one, recover. that what exceed is we Yoshizumi, I XXXX, increase from our reasons, the sales expecting number following the enhanced planning we Number their agents, to are associates. And will channel recruited -- XXX expecting to of agents new results. is our are expect Starting XXXX have

related new highly the to as well these agent that will in second And Consultation in Yorisou third going their rated be that the product steps has sales successful. And will recruitment cancer ensure new our our sales we our in cancer increase continuing and are and that quarter the expect then point Support, Post Post And are to that of young et of expecting insurance with The point is the we be medical customers. the Japan care nonexclusive type feature that XXX product This ourselves do in been And to as cetera, be my young future productive which quarter. competitors. And to taking our is also to growth through product are June. are against have channel. We our will those second XXXX to commercials, web second effectiveness. and further Japan we consultation promoting we become more furthermore, to is will Cancer been video insurance by leverage to coverage for as and segments middle-aged is bring my differentiate formation will among TV customers measures include launch point large them could customers. customers planning received that has more competitors. value a implement our well nursing significant using fourth differentiate we at from agencies. And product asset service And ads, further plans we and attract

aim sector expect to exceed we to and implementing as and sales XXXX third increase We we by increase to sell concurrent second expect And steadily these additional quarter product also customers new and through sales. follow-on results, these sales. measures, an in

We are our me. That's from steadily targets. aiming for sales increase toward all a XXXX in

Operator

comes question next Gallagher Evercore. with from The Tom

Thomas Gallagher

you're the Japan I sales. of issue, assess back and more When think ask or industry that, that Aflac-specific? I you as underwriting is it you some pricing is Just I I irrational Do in Japan. an on products like. today, try issue? The think features deliberately implies circle think mentioned Is there's that hear not wanted certain don't product it to you you reason

where So on little on? color Is going what's overall, it see that's medical, And you of out? a playing do how that happening? bit just

Daniel Amos

Let's our I pick too. -- on up a little don't and bit it Japanese let that, cover I'll more,

Koichiro Yoshizumi

[interpreted] Yoshizumi again. This once is

Let your questions. me answer

is those a And year-on-year this a medical is agency we insurance and nonexclusive to the especially sales well insurance customers -- under year-on-year in or our large our to below. medical how been this And basis, increasing sales doing. sales XX age benchmark agency significantly XX also, on the sales, increasing nonexclusive sales Regarding on this see have large basis, year.

young sales already promotional middle all measures selling we That's for who aged We me. are to to roll have planning customers, successfully. been our out and enhance further to

Masatoshi Koide

in adding be by timely under more sales competitive our meeting products and a I by do in new [interpreted] is customers in becoming sale situation sector launching a by number the we Japan, the and And training. cancer sector. we'd year sales of And Japan as competitive would sales manner now, is be solid the really comments. year-on-year. mentioned channel right This few per way, and strategy like of the third as to to to Aflac should In third very in particularly both In agents, more insurance. are taking like agents these medical regarding this needs but our is increase, have Koide. trying per not earlier, associates the that productivity increase increase sales customers. And through the headcount, we sales increase are increasing to able head strengthen we our Yoshizumi-san only to we also

Another in as alliance Japan across the Japan that Post strength Japan because is of we Aflac very strong entire Japan that Post products. And is taking Yoshizumi-san the mentioned, more has sales have a can our sell bit namely network network a nationwide Japan, network the time. Post recovery

However, Post increasing, Yoshizumi-san activity its just mentioned, especially sales Insurance Japan as is volume. in

not should actual they activities, So their only and and they be will will on they that's we what have also also be increasing association done. us. cancer, from activities increasing all hoping are That's -- only sales the sales to

Thomas Gallagher

anything add? a should ask Or I would follow-up? you Dan,

Daniel Amos

Yes.

Okay.

of ask, glad. to me couple we'll you then be Let else and want make a comments, anything

cancer our through is insurance existing all, doing Post. and of First distribution very Japan channel well, both our

we exposure up. we new, that really then sell. it don't on that currency want more on the We take And thing we our products of customers. that. don't and sell is pass other think competitive, say some just slacked to and our are that to the foreign to continue to nothing I have watch would hasn't it The but products medical That's competitors

And so that. we haven't done

that think Any those had, you real question I created. the differences other Tom? So are are

Thomas Gallagher

Japan. that standpoint? what suspect? product Can other bit on? weaker it is for do that there -- follow-up, about just do of seeing you're a companies, Or and in seeing you cancer persistency it medical it Is to And just Yes. little you're And the lapsing switching a is coverage? talk a from you

Max Broden

let me Tom, that. So take

block One main of that of have aging reasons the is we an obviously in-force.

to natural sales with you block. When block, and So also of new than going surrenders, yes. a lapsation. means higher see overall you That aging lapses the our the then lower overall mortality have associated is our you're that, some have

have higher also -- with a -- natural have we've lapses. we very product in That an you to X, products, aging reissue the and block. bit combination it's you have higher and years, your when you X refresh shorter in that a So block last you moved now lapse When you come into of have that bit cycles. a structural through little little tend

So are now are those a we main now than X you an I ago. we the see persistency did would what why probably X where point environment reasons years have in lower X, slightly structurally

Operator

with next comes The JPMorgan. Bhullar question Jimmy from

Jamminder Bhullar

discussed first mentioned question lines along And press Dan. is just release I your think also, as been Virgil the already. this what's the is well. of This So in

nature Aflac underwriting is people associate your given disciplined not Just pretty products generally margins, business. that of with something high have because your the just

So seems better I'm price pricing for them rates, business -- wondering than you the higher what's it in interest even with like your environment could changed? Because potentially before.

Or not before disciplined, So well, that right? wondering about more weren't before? little Because that, if different about on sort seeing U.S. trying as it's like have a So trying market, be could to anything the of bit you now highlight in especially U.S. you And gotten be outside maybe talked the Japan. competitors just it's you aggressive? factors talk could really you your where than worse? to what's that you're

Virgil Miller

Yes.

that. say add this me to seeing that what business. the Let evolution of is of our you're want block I to Again, is just Virgil.

business that to fierce discipline, there, Our is to you're though business, out there's that we competition see the group If able sure going are we're group the yields making talk has we that to is look we not underwriting only profits. the want when and compete, that. are in at over what that but competition doing several really, benefit past grow most about business voluntary continued And years. where strong to

the right persist. of to books go on course, So business any that, and time everything there the expenses that to we getting want on you the acquisition business we're bring has is in new that sure tendency into make the books, that

business of end absolutely that making a couple up period. profit to years' able on over we're So

Daniel Amos

sense that you then you about of ratio high a have will you benefit no have it is has and ratio an take plenty account high if minute, make basically and a profit. lapsation, you And -- that it low expense think a

So overall that you write at better looking aspect the our improve -- what a it. we've -- just that's seeing and it the value. benefits business us and and of every then allows by you policies doing been and don't that business when And to other actually increased we've for give move up as

a good ultimately balance So shareholders value that creates we but think it's not for ultimately only well. for policyholder, the the as

Jamminder Bhullar

then, have reinsurance on Okay. Bermuda you an your do potential strategy? overall update impact its capital and And just the Japan Max, ESR on or management

Max Broden

So to track our well. continues ESR Japan in

internal our running a the the on FSA little a the internal would that come FSA on i.e., model. to a difference second between expect for We the ESR on We XXX% relatively not -- material with and north calibration have soon bit our up quarter final based would calibration. our our are impact I model. current in of that, anticipate would

I So that have to expect wouldn't materially. number move

But assess it then based will model detail we on of ESR in more currently, internal December. XXX%. we're on and north will we the a about bit in talk our that, obviously, tracking But

Operator

Hurwitz Joel from comes with question Dowling next Partners. and The

Joel Hurwitz

likely there? more gains. a see of this that talk be continues claim Japan underlying needed? of or see should favorability remeasurement about we would guess you level seeing experience if you're to bigger this Can the strong year I remeasurement gains unlocking So trends pretty the persists, And just

Max Broden

to at to a future a be continues improve these current trends but been the you are as of the be long, we that our the hospitalization then continue main to anticipate to the necessarily wouldn't future but stabilize well. we continued they looking time, that Joe, then if remeasurement that necessarily when why future So don't we true -- do could favorable gains levels, to long lead improve. and see have it driver improvement they The if we you that's current quite frankly period from way experience, have in hospitalization continued you do will up But that will And reserving, -- see levels, to trends that. current experience. see in for

Joel Hurwitz

favorable just then And quarter. expenses, or sense. controls very that was cost How Makes be term in just sustainable could seasonality Okay. came this versus in much timing? that they of longer Japan

Max Broden

ratio Yes. and There's year, timing to expense towards outlook of this full number. in a significant element of XX%. are And both seasonality we the XX% tracking our for

Operator

comes The Josh from of Bank America. Shanker with next question

Joshua Shanker

There's a there now that Japanese mean intervention the out government the some right does of about lot of yen. What news hedging to doing the cost major program? support your for

Max Broden

So less can other all from that -- the pricing of ultimate the of be The has That options. pricing will obviously of option volatility with would level Josh, impact the itself impact together be options. inputs impact of sort to an normal that. into the the main cost those put

frankly, though in it's see I -- the of pricing the volatility the think even low recently. we trending, short-term the to volatility relatively at been quite that point, impact been this options. Quite So limited has yen

been you, obviously an that approach would Japanese trending being using of U.S. been Aflac holding So we dollar weakening. That are we economic significant we our levers this that. impact. all tell and assets do holding ratios. value any company. given it's company that the an the we there's see the also feel we And is protected with of -- statements that forwards that, that very financial being the a in yen impact protect and in account. economic hold has that The though, the That to try FX the and that then debt we we we to yen-denominated the have holding general overall significant issue of a And way Japan been view has we I are that a capital lens. well take we X out to company at move with it because obviously don't the that and

designed mind. this have these moves And well. performing in is program we point, kind of this So with at program very overall the

Joshua Shanker

in want increase lot large were to quarter, the color, bought very they can as your past look, harassing on even well capital than internal I quarter now that end seems willingness the shareholders? a at of back return the as factors your to this better bit a to of lessen of but David are first the ratios a capital higher I've the And model little that dividend you at me it significance end don't in but year. of through the guide to all been the shares gating walk

Max Broden

think well. return i.e., X the the driven billion of X, forward. is We over going the capital liquidity sits pool then that unencumbered which look roughly really, to Then company, in in how satisfy capital like on think is as billion $X.X the of about at quarters, we of at frankly, subsidiaries. our subsidiaries, both deploy quite one, overall long number have holding an the about And the thinking next years it's i.e. ratios level. So we us which couple capital the that generation currently helps and what all basis, capital the is we about at can short to capital, X, on term, of minimum look means shareholders next but north $X by, also the then that term, what going

these we where we then can the returns we take guide deploy the have can capital. the of dividend, what get we think helps we capital obviously, that areas best That sort we on of also And et us account in alternatives IRR. when buybacks, to cetera, kind for try expect what into other

Operator

The with Autonomous Research. Carmichael comes from Wes next question

Wesley Carmichael

give talk and estate Max, mentioned I right estate other foreclosing size transitional taking now? on owned. And sheet the on just real watchlist there? think there maybe it In us real loans you the overall on you that the about you're loan an a just update are of Can as balance monitoring portfolio,

Bradley Dyslin

Dyslin. is is we Brad which Sure. this stable. quarter, relatively our watchlist commercial as called out, Wes, overall the has In estate, real the been you've real the saw estate, transitional predominantly

on gain able that able on that, value. book we of small a assets. Generally, book $X.X that underwriting We appraised property. quarter. half in loan the in a where accounting watchlist have a Our good, is one, higher fully about value in loan-to-value it overall the to are we that. quarter. prepared but at active disciplined the are as exceeds things foreclosure proceedings The foreclose workout were is foreclosed mentioned, value, We were you small the billion. did highlight about we're Of actually solid to the maintaining does underlying rules It's number, such if stable it and the pretty our on the value to

signs We bit That different corner liquidity. but on certainly of of seeing outlets, in in the could life quarters. turning raised a be We're optimistic with estate. couple little some headlines about capital focused commercial will early, here early lot are of very It's that a we're a being real the seeing we next help market. in

see impact the to Of now our will significant to that the But in course, have. all right nothing really are eyes watchlist to in happen the Fed all, all on quarter.

Wesley Carmichael

to that outlook just of kind What's Thanks, to there? could you recruiting. given like your the expecting agent are the And employment you just U.S., Brad. And about any turning environment the U.S.? the change in strong maybe in talk

Virgil Miller

Yes.

look So tough for I quarter we're roles QX QX definitely would you Still, at it strong for commission of would a tell there. back it's out us. you, XXXX, if I was environment a say recruiting

we a year, this had comparison. tough knew So we

tell expect And you so to down. we I be slightly would it therefore,

and and tough, not we convert, knowing different to train to I'm on of I'm as throwing just QX. the sure recruit, the we means performance can average make deploying have up this build expected off to to our hit going actually So Again, produce recruit We're year. expecting about us continue forward. environment develop, we is differently. numbers rebound

Operator

from comes question Kamath with next Suneet Jefferies. The

Suneet Kamath

with to wanted having between Japan is nonexclusive exclusive of and the sales. mix issues, you're think, like that the seems channels. I one sales of It I start

nonexclusive is, that what sales behind you of channel? your industry channels? from percentage come And these my So question in mix from relatedly, of the terms are the

Daniel Amos

Hold on there.

Let you hear guys, the me question, Did can hear. all you -- Koide?

Masatoshi Koide

Yes.

question. that to answer will We

Daniel Amos

Hold on, translate. X second, just they'll

Koichiro Yoshizumi

Yoshizumi the I said speaking. questions. [interpreted] about numbers that This I he is clarify Yoshizumi. answering sorry, just will your what I'm be needed is this translator to mentioned.

I Here go.

the are agencies, is XX% exclusive terms which it that That are number in then and it nonexclusive which It's nonexclusive comes XX-XX, In is. of is and it what is nonexclusive it's the [ number XX% ]. terms agencies but agencies, agencies really is exclusive agencies, sales, XX% of not matters, of that exclusive to (sic) and larger, smaller when of XX% but agencies. XX% sales

called channel. channel, about are about In among that addition agency sales. of that agencies for the to explaining nonexclusive X% channel are our agencies agencies our large nonexclusive from sales there nonexclusive particular accounts large And the nonexclusive agency

Suneet Kamath

towards of here, strategies going my is agencies. these X% share gain in ongoing have an that to you question industry in of is if right? bigger Or these just sense. seems terms do agencies, And are be growth? the terms the only it's It nonexclusive is, The sales that nonexclusive That's large to channel? headwind moving curve like your behind in you

Masatoshi Koide

start me This Aflac speaking. out. is Koide Let from Japan [interpreted]

So these sells channel of agencies in always we clarify Aflac our as our insurance all, dealing cancer mainly structure, exclusive that Ever foundation since we the so-called agency purpose. have plus the me nonexclusive and Japan, And area. agency main first are let in channel have main had our been with. product agencies agency that our just medical our

anymore. other And the that loyal companies as is Because are years. And new agencies strength exclusive are you fact, many their recent this they to know, they Aflac not in this, And into are of to own that means agency just are Aflac. very Japan. there entries, in build entering channel channel are because able

into large sales. to been the So as their go agencies the trying they've to with channel, doing is deal to nonexclusive increase result, a nonexclusive especially what

as overall sales. So words, in is in small the we other sales Aflac's nonexclusive mentioned, large from agencies

have the that then market we customers we insurance it because is aged that own But large channels. is our our our agency mean also large a at time, in nonexclusive strength. any However, fact of is and of the customers. does have young companies behind strength same we not the is customers are main other because middle nonexclusive agencies because This increasing exclusive fact, this

through forward focusing nonexclusive we the exclusive start agencies, we that, result going to as medical insurance. to however, Aflac need Because grow years. our on do new a been And past And Japan medical have that the we large is on product, few more launch to what young year lot result, customers insurance to been to able have what have has aged a we mainly done as middle using agencies. for targeted last strategy So a is and which also not agencies. large of nonexclusive need just sell but we a focus this are who

growth we result insurance in in medical very this, a of had the first quarter our have a as sales large year. So this

Daniel Amos

try Suneet, think let Number isn't one new. because me nonexclusive it's is, the I to this summarize, something in important here. area,

other was business been you this and been back you've long the and phone that major there go you time, They you'll and around we them. up were ended business. them, had selling for was to look, If that over remember independent transferred a the agency insurance selling in cell and competitors for

being dominated We Japan business difference. making made Japan we a found into And the point Again, we've that. on And agencies do different we since a and everything selling is market. do will I business, the But yes, We think going up as had XX in cancer. ended is, the the a of handle was there third we new. inception. have along strategy. are has going wherever Japan And all the it's with is It to yes, that point in the But way a be we that That years the bread really only be being ago. big ready and Post Post butter it's what's leader that nothing now with our all, a to on sector we'll winning. direction. Aflac them. plan up get the product. They is, ended lot But do

Masatoshi Koide

you. to that. to a color more bit little like And [interpreted] I thank would add Dan,

on are really truly now. agency right channel large the We working nonexclusive

Japan However, mentioned, we we have bank partners as as agencies, Post other business as I agencies have have Dan channel and Japan Post, well nonexclusive have and channel. mentioned, exclusive we we as

of sector channels have we this our So third products. variety sell that

we to And and so our sales. going growing that be is increasing how are

Koichiro Yoshizumi

[interpreted] So Yoshizumi this again. is once

is little information nonexclusive your #X of more large to sector medical and are sell main cancer overall product. a we agencies, the products altogether and medical of policies combined, question. number total the and a to the Let customer me cancer first just our in insurance add bit are Japan. And product that added products main Aflac, they The

do increase So our as agencies. our able driver that we other be number think truly will to believe of through will that the we I channels And sales well. exclusive be

Daniel Amos

question. that answered we've think I Right,

we'll a be you follow-up, But David? to do If need that. glad

David Young

our I Betsy, call, correct? think that's last

Operator

David remarks. to over hand any like to closing Correct. I'd for back it Young

David Young

want you for our at if more Thank analyst financial questions you'll us Agency get and have coming Stock Relations. the reach briefing information the follow Yes. months, Rating joining please in X. this out very York any all Investor that much And about you on Exchange morning. up, New you December to And to

a you day. again. We great to will Have talk

Operator

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

on the this You live now of spoken [interpreted] are transcript interpreter may that marked present by an call.] were disconnect. [Portions

Aflac (AFL) 2 May 242024 Q1 Earnings call transcript