AB - Earnings call transcript Q2 2024 | AllianceBernstein Holding L.P.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Thank you for standing by, and welcome to the AllianceBernstein Second Quarter 2024 Earnings Review. [Operator Instructions] As a reminder, this conference is being recorded and will be available for replay on our website shortly after the conclusion of this call.

I would now like to turn the conference over to the host for this call, Head of Investor Relations for AB, Mr. Mark Griffin. Please go ahead.

Mark Griffin

operator. you, Thank and review. everyone, our quarter second Good welcome earnings XXXX morning, to This accompanied of webcast presentation being conference is call and in Investor www.alliancebernstein.com. that's the by Relations website, section our posted slide a

after us Private Seth President Onur Wealth, us are Erzan, will to the Marks, Global of questions and Bernstein, the results join and company's With for our today Client quarter Head Jackie CEO; prepared remarks. CFO. discuss Group for and

subject we'll Some SEC today present to of and disclosure. certain and forward-looking information regarding regulations the rules is

So harbor I'd of the like to point language our out safe X on Slide presentation.

also we we language in filed provide and not in can our substitute distribution the which We our morning. on XX-Q, our addition our base to our You safe a GAAP results. this to as find which MD&A for results, harbor unitholders of adjusted

reconciliation address and ask and press to Our in only may all Under a results GAAP forum, during call. XX-Q. from nature such a appendix, our of standard presentation public in this please release investment so the are questions material GAAP community of management our FD, questions reporting adjusted Regulation

to I'll Now over turn Seth. it

Seth Bernstein

Japan in continued and retail growth, taxable AB's us second joining Good diversified income. fixed U.S. and you income. sustained fixed tax-exempt ex led and market drive today. the gains global Japan further In thank morning, by share for strength both offering to organic quarter, in saw APAC We equities

as private $XX Equitable initial private and Our completed to grew equity billion commitment. driven markets business well, billion credit fundings $XX real estate with by its

and investment And strongest its fixed income. Wealth performance Notably, alternative business had in our improved equities in healthy ever. importantly, remained raise Private

as our margin detail, points AB's up executed plan. adjusted multiyear on Jackie we XX.X%, basis was improvement will As operating XXX margin year-on-year

investing progress the long-term Taking U.S. and of retail distribution from from our step back, we're private strategy in wealth. building benefiting out made in a

in our insurance China despite what in enthusiastic While are what we're has we're markets. and challenging it is good about vehicle seeing local start our early days, been

overview get on into let's firm-wide with X. a Slide Now the specifics starting

quarter a Firm-wide sales X% net billion up $XX.X growth. billion Second ago period. $X.X inflows XX% or were $X.X from were active billion, annualized gross or organic year

year-over-year the billion of Quarter end increased the under XX% first under end of X% second quarter assets from management quarter. $XXX by X% management and XX% up and sequentially. And assets average year-over-year were

$XX.X quarterly trend quarter second channel. both driven Slide Strong net flow XX% by year-over-year, and million. our fixed $XXX X active of Firm-wide, inflows equities. billion shows by retail gross were increased sales income

we $X.X annualized to in were gain as billion fixed and income share X% or continued organic the in Net notably inflows U.S. equities,

channel billion, Our as net of growth. sales outflows outweighed while fixed $X.X $X.X were institutional outflows insurance-led billion, income equity active saw gross

private reflecting performance tax-related gross shown Slide wealth, Investment at X. sales $X.X on outflows selling. net In seasonal slight billion remained with strong is

fixed Aggregate Europe government with and second Bloomberg corporate ] ended Global investment-grade and positive X.X% absolute income. U.S. Starting bond bonds. in the Bond relative quarter in The the Index markets both [ over lower returns by delivered as

healthy with remained High-yield of the the period, over performance investment-grade X-year XX% X-year XX% fixed the and XX% again markets period both outperforming governments. outperformed AB's assets over and yet period. income over X-year

our by double-digit clients. for across now a in translated X retail this growth income to growth including base to week, performance organic leverages quarter client for this institutional growing which our interest encouraged We're fixed annualized we've municipals. asset vehicles Luxembourg which This X% announced and X with mandates taxable factor-based quantitative institutional in launched domiciled segregated in earlier UCITS funds suite, systematic addition in our research

this flows to to should gets that as lowering rates, later we the bond today, on stands reason sidelines With which closer interest the expect $X.X trillion of handsomely cash benefit sitting it Fed year.

in again deteriorated the underperformed to Index Turning rally the stocks, while during equities. market X.X%, with growth technology driven quarter. second equity the cap larger as S&P gaining small breadth by XXX quarter large U.S. caps. Value primarily The markets lagged

Importantly, several domiciled Morningstar now against periods. respectively. we XX% the as peer that including funds groups X-year for foreign performance and large show of equity ranked our assets outperformed funds XX% retail improved X- investment all X-, our outperformed XX%, over and their our periods,

the clients. While have opportunities we and outflows equities are quarter, we see in to seeing with continue outflows slowed, increased in recent

and by across see quarter for both $XXX we value for retail momentum valuation our a European seeing institutional and win given we performance large-cap increased channels. Specifically, is growth, encouraged million strong. U.S. value, global meaningful in spreads interest also the We're which build new relative in to were service for growth

Slide Now channels munis, high up income X. on $XX strong product inflows sales beginning Gross of billion, and billion client reflected by our at breadth robust I'll U.S. year-over-year. our retail XX% $X.X with cap led geographic growth. Net large remained review and

X% ranking for offshore with both X ranking annualized funds, In income large its in in inflows grew mortgage taxable a at category. their first we our high-income and income, second fixed categories net organically

barbell suite, billion that this quarter, with mark mortgage the profile a that rankings strong crossed income, track a short a complements $X strategy duration We're record. across with pleased our XX-year income

Notably, organic inflows quarters. positive with last over up Munis the growth equity net driven inflows $X.X XX large net growth. by were a posted million XX of rate, $XXX billion, active sales U.S. periods cap annualized of both XX% out

see the active week. We launched retail ETFs, equity In converted to strength X last quarter, another in X date. continue to more we active we and July

ETFs, new first billion, which principally billion. now which and XX are rather $X exceeds total $X.X our than services now existing ETF services Our new including wrappers,

Slide on X. Institutional to Turning

versus year by Net was periods. outflows and sales $X.X a $X.X prior of billion $X.X fixed billion billion, up in from quarter income improved ago line active gross growth Insurance-led redemptions. were sequentially. equity Second outweighed

with quarter, program fundings $X.X and markets initial fundings quarter And of in at $XX $X to billion U.S. the our completed AB over mortgage cred. Encouragingly, Equitable our residential from CarVal. this we billion commitment strategy AB in saw pipeline including private its billion CarVal's

and at sequentially. billion private driven $X.X $X.X down were billion wins. was income fixed global short by duration pipeline additions end, quarter $X.X Pipeline plus also billion The placements, primarily

on wealth to Moving Slide private X.

Second sales were up by net quarter net line and tax-related sequentially ETFs direct otherwise consistent quarter included proprietary quarter in and $XXX of million inflows year's billion turned gross selling strong in into with Seasonal outflow. second real with inflowing XX% productivity. adviser last or indexing strategy driven $X.X estate Strategies munis. net year-over-year

for on remain we year organic track Year-to-date, of growth. consecutive fourth our

led a by equity close of fielded we ever of quarter, private with of fund our our largest drove record last which $X.X equity CarVal previewed alternatives and over funds. slate alternative offerings, estate a strong billion. with single Real raises AB additional raise As

our private year-to-date raises On flywheel alternative our year-over-year, XX% strong a catalyzes are strategies. longer-dated effect basis, as business alternatives up the proof wealth growth of private of

it Jackie I'll discuss and the financials Jackie? turn over Now to taking wrap up to before questions.

Jacqueline Marks

by the Thank with and progress then you, strategic up across wrap summarizing Seth. in our financials the initiatives. our quarter start I'll

As closed first deconsolidated, April you quarter Services venture, on X. reflecting Bernstein joint know, is this our which with the reporting results Research

earnings. Our gains in the net income the and GAAP interest the reflected line equity of and investment revenue now JV losses is in

gains a As to this no earnings. adjusted longer added are back business core or operation, any losses is

Slide Let's XX. start with income on GAAP statement the

to were prior quarter year and both net the exclude billion Research Second a GAAP on X% of periods. revenues in like-for-like by Bernstein from XX% up we period $X.X basis, Services increased were if

the as new $XX first and of to transitioned a share JV investment million included We loss from entities our JV customers quarter operations the of operations. improved results scales. in Revenues as the its anticipate business

by a increased year-over-year GAAP by XX% of driven to EPU XX.X% of sale Bernstein services, increased by benefit year-over-year of and X% million income per XX on in $XXX million GAAP margin points. operating operating a GAAP quarter Research $X.XX $XXX EPU gain results. increased nonoperating of $X.XX the basis the primarily

shown operating Slide our Slide part I'll items the on business. are which shown on remarks remove are XX. of the focus as adjusted our effect XX, I'll my we from These of walk highlights on considered here that not which through P&L results, on touch certain core

Reported were of versus like-for-like revenues flat year basis. increased and XX% million on the $XXX a prior net period

the increased operating Second XX% XXX by prior of year-over-year. by versus year increased quarter period, of million XX.X% basis points operating and adjusted income margin $XXX

of Walking revenue. through components the

driven quarter average higher year increased Second the XX% fees versus period, base by prior AUM. X% by

basis The marginally primarily up long-term quarter, and of XX.X funding by fee points second driven retail of from was the first growth rate alternatives. quarter

lower The and munis fee organic rate declined money X% markets. including fee year-over-year, driven growth rate predominantly asset by mix, and

private quarter credit. full of levels. from We fees up $XX $XX and year see from higher equity slightly Second to prior the performance XXXX million million now due period, performance increased short from long, select fees, XXXX year U.S. by fees primarily

deconsolidation. million expenses. of Moving declined in, to expenses total Services operating adjusted the by second Bernstein quarter our $XXX X% year-over-year, reflecting All Research

compared by driven was quarter compensation X% adjusted expense benefits with Second the of compensation prior revenues year period, net slightly prior XX.X% ratio XX.X% down the period. total versus as in year lower and of a

market to throughout year. plan Given accrue adjust conditions, compensation a XXXX continued we further equity at quarter in third may ratio the the and of strong XX.X%

reflecting we Services promotion of the trade Bernstein decreased significant the As deconsolidation. period, from by and the expenses guided, year and XX% servicing prior reduction from execution costs clearance Research

XX% year calendar year-over-year embeds to For fees. XX% fund mutual basis, on expenses some growth servicing which we XXXX, decline market-related transfer a retail expect by from approximately promotion to and

year-over-year. like-for-like in G&A down slightly the basis, our prior expenses period, quarter the XX% better than by prior was a year On second X% versus declined guidance. G&A

the in high to XXXX and our from year year-over-year American to $XX into continue the We strategy, full relocation G&A single-digit third mid- the anticipate for expense York on North expenses good of pulling to forward We're million building fourth a decline the quarter lease quarter. basis. New legacy expect progress on making range we

X% XX% we prior quarter third G&A the by fourth expect decline to year, G&A will decline by will the from approximately while quarter prior year. Accordingly, versus X%

in quarter than of XXXX, X targeted is now XXX relocation strategy improvement fourth As we basis which points incremental expect from will planned. quarter margin earlier the the year-over-year to commence XXX our such, of

year capital $XXX debt quarter to quarter stemming million payment. was in freed We $XX period. first interest million the expense down second by addition the regulatory up. decreased reduction net from JV in $X debt incremental quarter from That's an paid prior as of equalization the Second the the million in

on from quarter, sale and operating net EPU, Research expense. outweighed acquisition-related expenses, That GAAP gain the earnings was $XX non-GAAP operating $X.XX GAAP were adjusted Services interest the In second the as acquisition-related million expenses. Bernstein due of earnings earnings JV above EPU above said, to

expected, a for tax The tax AB favorable mix earnings which effective of Group. lower across X.X%, filing was second was quarter ABLP rate than reflecting

the guidance in Our of ABLP's from for X% of is X% XXXX tax X%, range down prior to range X.X%. to effective rate now a

Research of This earnings, initiatives Services our JV. foreign the Bernstein finalization savings tax mix reflects and of

our summarize against let's initiatives. Now our XX key turn to progress Slide to

We growth. delivered retail offerings $X Seth investment diversified growth We AB pipeline, globally the net improved diversified institutional organic XX%. over and with driven our performance, CarVal. our periods, flows with fundings As continues for from positive year-to-date funded income, highlighted, at active billion organic in and channel coupled in by base, drive to growing our and at quarter over fixed global client second billion well-balanced, including $X sustained X% municipals saw

commercialize $X.X billion in we suite services. launched Secondly, quarter, scale in ETFs We at active the of AUM. our develop, continue to with now additional standing and X XX

increased Our private AUM by deploying private wealth, CarVal initiatives also We lending AB X% expanding while to $XX year-over-year. alternative interval supported our billion, the in launched NAV up Equitable. markets offerings fund the

on We announced remain Cornell forward. business, insurance us our an operating as focused focal point for the executing important we of hire CIO Jeff margin expansion. on going of targeted Additionally,

quarter margin favorable XX.X%, Bernstein was benefit Our Research year-over-year from Services basis second the points reflecting operating and the XXX markets. up deconsolidation adjusted margin

point that executing target are basis margin to Overall, way you we our XXX our we improvement on operating last XXX year. on multiyear outlined well for to

that, Operator? to answer With we are your questions. pleased

Operator

question with Instructions] Bill TD line [Operator Your from first of the comes Cowen. Katz

William Katz

do day. up. morning is the mixed longer money busy question of you on a thanks again I from comments your companies, duration from for different Seth, hear the asset also I fixed big sort this from? picture think I expect of guess comes appreciate supplement streamlined things where so very pick the income sort down, demand a

Does liquidity from system? the it of from this you do AUM? the see come that How out? longer-dated sort playing other Is in

Seth Bernstein

sitting start some think, is, and the, whatever it want Thanks, whatever, add the Bill, market for to thought certainly, of funds. X.X trillion to on may the of pop in comments. first I'm question. number that's going some Onur comes of of I money My out or and cash And

the it's I are sideline. sitting more said they $X.X certainly But comfortable they that ease next that's on be trillion think, easing I they think getting if particularly retail that week do in investors September. will that

certainly think of and it. I So some it's do we see there, coming

in say as see SMA fully trigger see in continues second as will We pension here think which both it our United I'd now derisking, the benefit in are annuitization quarter. schemes funded will or which defined States near as also some the allocation. that muni I growth, well

And continuing offshore. we demand see

watching that I know it issue But So for well. Onur, the we're is mean a I that's to in it you want for the us the think than I an offshore although I have think obviously less as demand past. don't of was market different if add. anything you continues.

Onur Erzan

No, think any questions I other Seth. the summary, as come was to that I come a good details in. back can

William Katz

conversation. your launching And Jackie, good. maybe a Very ended Okay. the you point for your as of follow-up, just way sort

which so you that. there exited to is the terms of some was in you're overhead bit platform, BRS I I margin, think think when it sitting embedded a moving like quicker, the inside And see. guys great sounds Just little

I was ahead, of already get the to is faster, BRS? about out trying running business coming running the remaining as to end to be we should core I we the think, the like recently, margins an I you in still look wondering, at just have, yourself Day where thinking at opportunity now just overhead how you're towards are and here, relocations think, take in since sort you're at, sooner state for maybe savings some Investor given your

Jacqueline Marks

Seth. Thanks,

market very still remind that you we the are guidance not did gave. to include We I that, that guidance committed performance.

and strategy, specific is Research the improved specific about which talked relocation the that of from to Bernstein performance to we deconsolidation the Services. So

that costs JV, time have Bernstein work already XXX provide that employees the the us with services some to the question, transitional to in will will as We the to to we specific allow off further key those services to that Research the transferred. JV, that we being by done as I roll of say, continue evidenced the services transferred had new agreements resources Services majority under which rationalize future.

Operator

Your next of America. call comes Bank from from Craig Siegenthaler

Craig Siegenthaler

you're I you cutting. question out. a this forecast we while, My which like and so flows, if say it think that flows been both But muni bond and is improve waiting businesses. for Fed we've nice the the I in it's actually on to when to starts expect on We feels and this see taxable improving bond handsomely winning agree, to heard you have

of any perspective and bond So timing as period inflows? I the a would think of elevated appreciate size we on

Seth Bernstein

and to issue. Actually, I would particular think mean, but I'll what I hard pass it it's sorry, predict own good Obviously, minister Onur. it's timing institutional their more frame has Onur, responsor Every issues, at time not I'm every add? very and to we're you it. a --

Onur Erzan

Yes.

of franchises fixed we obviously, one, see beneficiary with growth investors think flows. particularly a continue why demand that, with that's to strong net insurance some strong the companies, the of the of annuity I institutional liability-driven income had we like we are and

continue. to trend that expect we So

the money strategies. for case, earlier come taxable the mentioned expectation money retail higher and to play that, into market of of segments, more terms flow in out there In definitely, is yielding conversation, sides more we of some both right? In tax and Seth exempt funds our as

We leading gaining share have franchise. a market

So given we allocation environment, so historic benefit client trend continue, lows from from expect that. income coming demand, fixed we'll a of that combination both yield no to of

of and and high environment, do the kind this yield in internationally, then to strategies, well. both barbell global And typically continue our U.S.,

well strength all or So franchise offshore. across about fixed with but institutional exact feel percent, retail for our start again, continued U.S. to and precise all, in the as as we be confident income quarter

Craig Siegenthaler

it's ultra-high follow-up, on networth. Just my

of higher curious been because wires? offer private have firm. you fee recently a at with tiers, move for and this adjusted with your with options client think cash guys this So rates channel focused I mainly about cash out tiers? sweep especially cash And you are effort that inside never thinking focus what on and wires the sweep the given carved bigger networth several just inside I'm networth, higher recent an of adjusting have been the I But has but Bernstein ultra-high so strategy you the ultra-high has their the recently before, Bernstein,

Onur Erzan

Thanks for that question.

growth networth all, ultra-high of continue we our segments. high and first with family So to office experience

happy of So relative opposed are the strategic we segment value given to growth focus, as with our segments. that lower

to important cash, more it X the fees. revenue advisory comes When and platform for distinction our is our XX% of comes than from service

And So That's I high-quality spread as sensitive to it's a not right? very income, recurring result, it's fee very base. our something think that why a franchise makes predictable. very

to proposition. extremely and rate, cash part be custody client of the clearing, of On is in-house always which taking our competitive, advantage want we our

We rates a the on the X.X% and of Today, clients. for our to our the has to X%, been very are case competitive rates between time. able are long to offer that type depending clients,

offer very to cash clients. competitive our So we rates

So of furthermore, to in in options, offer also Private very a funds, addition we Bernstein our options. then And market Wealth flowing franchise strong we have our are the our business not market some money and terms nervous about net third-party cash we money of recent developments. strong in

all, all been about dependent that any and So has suit. rates very on a, competitive not our high c, in b, we very are dynamics income interest we less worried have we income; given accretive; then, are on

Craig Siegenthaler

And X.X%, pretty those are rates, good. X%

Operator

Jefferies. Our next question comes from Dan Fannon with

Daniel Fannon

is to your wanted on up follow I Seth, still And equities. a obviously, on comments bit challenged. the industry

seeing on outflows up looking at value still But wins some some demand. in pick side, growth about and and performance talked You there. you're the the

headwinds? and/or about potential complex get you the terms on see to overall of in outlook think where equities prospectively, just color So a as and wanted more you momentum the little the bit

Seth Bernstein

for Dan. Thanks of the couple Okay, question. thoughts. A

largest continuing unique. not component of but that, it's active of that, seen Large-cap not but the a in in is have retail. equities unique. it's It's we component strength First, growth

that say the also which beginning think time years the I wider for I been be is interest and value here, U.S. in in I've we quite more can it gauge to the see think are I'd but of pronounced value, in that, X potential Hard to significant. first spread exciting.

I are growth going institutional But to in we've concentrated our concentrated, sustain and on strategies, global we're core see think struggled we strong it's our days, of it's had more particular, very Where early where side and need the performance, course, to and performance. strategy. value historical strategy X appealing

have last so few week-or-so the I'd seeing hope dig helped, than had to while of, redemptions And were higher we we those a hole weeks out and -- strategies. in last say, big would we

tapered bit. Now they a have

And quarter-over-quarter, redemptions year-over-year, of that, But has of performance-driven. institutional, the amount the redemption -- the course, fallen. is

know has been however you if You key treacherous trading be marketplace pretty to And to market. this you concentrated and have better I, it, strategy weren't much was a that concentrated wanted you very the in. a than a long define

relationships We equity think it's and I'm are overall have set long the consultant see quality been we have we very confident have there. I exposure by the strong in improvement encouraged They of And a it the investment of of it. hand, we recognize it our partnerships, to team. problem. in a and and But but continue performance to

I equities, to you the to that? we have a it's but wouldn't while. I institutional you over in demand. want be say the transom, certainly am side continue side been but Onur, do anything for to see do retail But it's than coming consultant the on than it's optimistic stronger add more on I

Onur Erzan

institutional we on X the over redemptions I Yes. lowest the had was mean quarters. the last level of redemptions, this

that than still but So it in to definitely the was quarter see institutional, outflow previous pleased there. line are X for good us better I the the much with it's redemptions trend quarters. mean an

that are in an positive competed the obviously, equity in retail is Second, active we and we with active I shop turning quarter. second think, well

strategies. however, aspect of the managed is The other tax it,

have income, into innovator that in tax have We equities. management an and fixed in we been carrying been

Our very equity mark service hit managed called with just $X tax momentum. the billion high

growing and way that So tax of sometimes the interactive will think our is be part play a I active franchise. management we

in fixed but So management I with synergies broad our range pleased clients. and a the of capabilities equities income in bringing them and total, see we as SMA a strategies the our tax there, and of know it's percentage for smaller between momentum

Daniel Fannon

whole. Great. are date I That's as this billion, some to curious, been helpful. or XX you weren't strategy of smaller as but thinking or but I you're think was a And ETF a look think, we the more new active with you at to the it, was ETF historically are XX your sticking several still I $X.X strategies peers products, about, guess, in I think complementary these they've it prospectively seeing get market. who as in -- contribution, market just

so thinking and curious strategy just your And you're longer how about -- it about thinking term?

Onur Erzan

Sure.

of the pleased build-out acceleration are with We the business. and very the

in If you was our first ETF back recall, September XXXX.

have we So than XX have the less in $X.X with we now products years. been billion. for market X And

that's I existing a my strategy, a we're then think, our strategy. terms in we the third . Yes, opinion, So and plays, product X of very, start. to have add good in play basically to going

new obviously can player products is in where enter. First introduce categories we

competitive have products duration money now market a done short first ETF, our which $X is We billion. here, with like above that

was that space opens existing Number where two, to distribution make go So add access conversions using conversions capability. channels. and new white

with was U.S. right? short-duration when the it's high first And much small had have that including we the the than we was it a we fund, a more converted ones converted, yield, seen done base, recent on although have the since flows which X fixed conversions we the income. X mutual had, we We

a these categories, now is fund as mutual harder, an world much well. -- open getting strategy retail in launch the in broader online you space to higher channels ETF, but shelf through the Because you

the been part convergence the So has strategy. second of

markets they over markets, we evolves, in ETF as go active, distribution -- third to framework of in world, those and those now different only Obviously, we parts looking really at particularly as The our from developments of many are we capital passive well. the as time strong the to Asia, is part with the look of markets selectively at regulatory some markets. strategy will so have enter

highlight. important a are to those So areas few

Operator

John Our Evercore ISI. Dunn with next comes from caller

John Dunn

cutting Can for how funds rate cycles out us have Asia? of you kind distributed past for in your frame high-yield played

Seth Bernstein

you repeat question? the sorry, just I'm can

Onur Erzan

I Yes, can get started that.

fixed question the our was how acted cycles? reduction think rate franchise I had income we when Asia previous did

John Dunn

yes. Exactly,

Onur Erzan

Look, size the fast reduction of the day, well. at that and as I of think on the it how the end happens depends

the as barbell So our environment, our well and high-yield our strategies given In rate I think strong. as strategies. it's believe current hard performance to even We should with relative demand remain generalize. cuts,

any And lot if recession, has are there, obviously, comment. in a of been our cetera, expect Seth, et type please based don't variables terms credit the no major there demand the of we of based spreads, But the market run the issues just low. cetera, which including strategies environment, on history, relative the performance but we there's rate or et on the and

Seth Bernstein

thing what I'm didn't is the out only is I the exactly I what other hear factor was, would I sorry The would local add, point question alternatives -- John, are. the

Chinese we've was strong. rate the equity but market quite local where periods declining we've been So environment, a in had

be. would for product it enthusiasm yield might otherwise the So U.S. less been have than

That's in not that low of although today. base local also matter now, valuation an issue a that. around, certainly the determination But alternatives could turn

John Dunn

be And it. attractive of Got an Japan then increasingly seems to interest. area

growth other products any sell there. guys a And how Are focus of U.S. much a equity funds marketing? Japan? is bunch there You you're of

Seth Bernstein

on very on well. for as the not Japan remains historical just and retail side the focus institutional but us side, strong, a

So we've seen we're our fixed success by. in excited which systematic income,

are to But and our other institutionally clients there discussions there relationships with report. meaningful nothing have to in on continue strategies. We

an yield important strategy for be us global continues local high to in retail, In market. the

lesser a to degree, but there AIT those for continuing so there's demand And products.

Onur Erzan

add. market-leading On wrappers, the Yes. mentioned. large-cap things local John, the ITM Japan, I that have One, that growth like we range. product would X ITMs is an are you

pension range to the ITM Japanese is So called actually regulation market. NISA NISA Japan sales expansion been led in accounts strong accounts. in new expansion pretty that has important. There a

our strong an given strong network that's manager, reputation and us. equity for So a favorable active as distribution trend

fixed from actually, on been our institutional, strong for significant income and pension has fixed have in there fundings we leading interest systematic Japan. Japanese And investors, systematic income insurance capabilities Actually, in clients. new seen both

But So hard and word predict. all to word rates there's we if a is The of there hikes of the some have Bank to yen all, there, ways which in multiple Japanese Japan. I caution think play could uncertainty be of is caution. Japan appreciates, obviously, always

Operator

comes question next with Sachs. from Our Blostein Alex Goldman

Alexander Blostein

I question to and see with next around guys institutional a $XX things billion us the bit are your I that progressing deployment and the you And with the a earn? can the one, wanted rate the of broadly, sort the as to that's likely pace rates about strategies -- there. start little guess you it's nice and insurance the guess, Can onto couple from disclosed your pipeline business talk a I you in fee the deck? perhaps of to that of you help frame fee on additional partnership.

Seth Bernstein

in AB our continue With cred. to us, respect it's in or in billion CarVal PCI to institutional, They be funded. business working with yes, the first whether $XX from Equitable U.S. been and has

you continued to So perhaps bit give there. Onur, want color? a participation more

Onur Erzan

sure. Yes,

of quarter, our GBP our funding over this the remains very pipeline, pipeline strong strong terms fund. In despite billion X

pipeline institutional. billion our in -- is know, you around As near the $XX billion still $XX

attributed are rate. And alternatives. fee run current of effective to remains Of significantly higher rate fees that, our than the the XX%

So it's rate for around blended the XX in the pipeline. right basis now points

Alexander Blostein

Great. That's bit helpful. And little bigger then just a picture.

still guys You pieces or private that fixed find credit there in especially pursue sort that insurance comes positioning you made AllianceBernstein a be that serve continue the you think to private significant channel, you when might are progress in to do all have it space to broadly, need necessary player of you pockets income to to and the inorganically?

Seth Bernstein

business. as of are strategies We with we need. a and running think number we in is have the asset-based that of vast the up There picking tools CarVal our majority PCI

I to that to asset -- our there clients [indiscernible] think [indiscernible] look and that at our debate. we are is liability manager also, continue some one areas

were there. And I [indiscernible] nothing their platform -- work that they mean, and just to focusing, build we're those moment we're marketing say at PCI out mostly there's and I So support current would to them of need. and the Cred continuing CarVal

Onur Erzan

Yes.

Onur, -- as added well. we jumping So in here

on progress strong very clients. IG made We've credit. private investment-grade services insurance-specific the insurance for On

NAV that know, you lift Equitable funded We heavy a create the financing infrastructure loans commitment. to terms $XXX in in home the than As a U.S. significant that. with more into million is of residential came obviously

that offer both can to We third-party well clients as cases. on

private As asset-based Seth relationships progress finance, IG, specialty financing the great estate real of and leading mentioned, lot traditional banks, have making with are we a our and debt, then including we on placements.

we of boxes, the I for think insurance all of private think if the as appetite typical credit check general about not So the we boxes. account IG, most

So we believe our complete. platform is pretty

Operator

line question Bill on with have Cowen. TD the Katz from more We X

William Katz

items. Actually, couple cash bit further the allocation, the market? we a what just of of in what's the Could wealth versus today? little cash the platform. housekeeping it's between in portfolio dig on to suite What's sits But back percentage to money in split just a private coming

that dynamics And rather is other and less there that. you pricing and than on X%. that think follow-ups down is have play? after were I here your mentioned X% anything Is competitive X% is, other tiered I And high, yield around than to at the

Onur Erzan

Onur, again. Thanks, Yes.

our comes the fees. majority great mentioned, of fees from service the over XX% I and As advisory

a our So it's revenue huge of sweep overall positive, driver although picture. economics, the cash it's not

be options, cash cash the the terms allocation In tends relatively of to small.

money stays be that in market cash a money third-party would proprietary firm. our either or market it market the accounts, typically, money chunk So to goes good of more that the fund funds, transactional own

and X% the how the of I to cash think, in As to add market be money when that's, so low- assets sweep to in digits, mid-single assets I it comes cash kind balances X% up. those the are of would would our typically

assets flow Remember, relationship, but cetera, so perfect how flows, like not it depending cetera, et on fee assets match, a why it's through advisory some that's et not works. that's sometimes the and the might

William Katz

follow a little competitive Seth, July sort you of Okay. talk offline if just overall on little dynamic. us of trends And you up big on picture a bit the teased date. I'll of the and maybe is out the to flow bit how picture was zoom the about some I could wondering looking?

so X left the last billion those was clarification make tax $XX you I'm that sorry also if the could were $XX And Equitable. questions, I'm pipeline was? counting called driver And part? big in to have then how big you but the separately, frame I wealth want sure ask private point, then not to about side. billion impact just with taxes out separate out mentioned many I and opportunity. wondering Are a you double you that to

Seth Bernstein

has, order, don't things. strategy reverse are it's where The consequential they number and situation a and But of a I built Equitable us on in the So particularly particular think operation. in that's the in institutional scheme pipeline separate. yes, except they already in not mandated

that would NAV So up, I have think, but for but should there's I mandated, overlap terms $XXX Mark shown was X. think mandate, example, the that it think in in an [indiscernible] the between once I clarify million don't -- of

and that going keep private to regard remains of part it. of regard was retail that's with to But seeing think, is And first the and I wealth, part put way trends question second the think institutional, on question to it taxes I'd I trends, second the with just the the mixed, continued. or question. -- strong the In pretty

or Onur I it. want take that? you quite do didn't understand Because to Jackie,

Onur Erzan

didn't clarify I sorry, tax the you tax question. the can On Bill, understand the fully question, question,

William Katz

Yes. on busy I'm a this to sorry [indiscernible] drag day.

Just by was private the impacted in side the [indiscernible] that wealth of quarter second quantify the seasonal that? sizing you had redemption tax-related mentioned

Onur Erzan

Yes. absolutely. Yes,

So apologies.

So XXXX. -- was Bill, quarter on to it second one of similar that very so the

we a than There's million sure. outflows. effect for had of $XXX seasonal less So

sales If you up what the confidence me than has year-over-year, you our is momentum. and that so look been at gives XX% sales more strong shows

or raise private get capital We net through And counted remember, flows until wait start for they It fees fund right? was our raises the all flows, earning to all-time or until funds flows. raises high. not record be net deployed those out capital of channel,

is a positive. So that

third, of you then look And productivity at advisers, strong. the our if it remains

So in if all about anything sales good about materially pipeline, all, sales the think quality wasn't the year. And momentum and tax than of there we outflow about last feel outlook. you different

election high put the people on coming, values action. into market said, That relatively full more of rates with with are bunch kind to the motivated clients keep And super of money the not on equities, still a sites.

think a we're see that sidelines, the on will. you people a bit environment macro I make to So little if going sit will of

Operator

call turn over questions this are Griffin, back All no I further Mr. at you. time. right. to There the

Mark Griffin

answer great have to additional you any Thanks, Okay. contact day. call. our We'd Relations. conference Have joining can everyone, for follow-ups a Investor

AllianceBernstein Holding (AB) 26 Jul 242024 Q2 Earnings call transcript