Great-West Lifeco Inc. (GWLIF) Q3 2026 Earnings Call Transcript

Thank you for standing by, and welcome to the Great West Third Quarter 2026 Results Conference Call. As a reminder, all participants are in a listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity for analysts to ask questions. To join the question queue, you may press star, then the digit 1 on your telephone keypad. Should you need assistance during the conference call, you may press zero and start. It's now my pleasure to turn the conference over to Mr. Shubha Khan, Senior Vice President and Head of Investor Relations for Great West. Please go ahead, sir.

Thank you, Jim. Hello, everyone, and thank you for joining the call to discuss our third quarter financial results. Before we start, please note that a link to our live webcast and materials for this call have been posted on our website at greatwestlifeco.com under the Investor Relations tab. Turning to slide two, I'd like to draw your attention to the cautionary language regarding the use of forward-looking statements, which form part of today's remarks, and please refer to the appendix for a note on the use of non-IFRS financial measures and important notes on adjustments, terms, and definitions used in this presentation. We will begin with prepared remarks, followed by Q&A. With that, I'll turn the call over to David Harney, President and Chief Executive Officer.

Thank you, Shubha, and good morning, everyone. Please turn to slide four. Great West delivered another strong quarter with base EPS growth of 11% compared to the third quarter of 2025, which is ahead of our medium-term objective. Base earnings reached a record high, surpassing $1.3 billion, driven by double-digit growth at Empower, together with robust capital solutions demand in CRS. Overall earnings growth was partially offset by a continued moderation in insurance experience relative to the record levels seen in 2025. Our results continue to demonstrate our strength in execution and the progress we are making to shift toward a more capital-like business mix. We are pleased to announce that our combined retirement and wealth businesses now comprise more than 50% of the combined base earnings of our operating segments. In addition, Empower Retirement crossed a new milestone, now serving more than 20 million customers with the close of the Milliman transaction. This quarter also highlighted the strength of our balance sheet and our considerable financial flexibility. Year-to-date, we have returned approximately $1.3 billion to our shareholders through share repurchases and ended the quarter with $3.6 billion in cash, of which nearly $800 million has been earmarked for a debt maturity in the fourth quarter. This reflects the strong cash-generative nature of our business, and we expect continued capital deployment through the remainder of the year. Please turn to slide five. As I mentioned, our base EPS growth of 11% year-over-year was led by strong performance across our retirement, wealth, and reinsurance businesses. This drove ROE to a record 19.4% in the quarter, including record-based ROE at Empower. We also continue to strengthen our market-leading position in retirement services and wealth management, with total client assets now at $3.9 trillion. Thank you. Including assets added through the recent Milliman transaction. This acquisition strengthens our defined contribution platform and adds a leading defined benefit capability to our go-to-market offering. Our financial position remains strong with solid capital and leverage ratios underpinned by the robust capital generation of our business. Please turn to slide six. At our Investor Day last year, we reiterated our medium-term objectives for base EPS growth, dividend payout, base capital generation, and base ROE. These objectives are supported by medium-term growth ambitions for each of our segments. Our growth ambitions remain unchanged, and we continue to make solid progress against them. In the US, both our retirement and wealth businesses delivered double-digit base earnings growth, supported by strong operating margins. The growth in both businesses came despite equity market volatility in the third quarter. In Canada, double-digit growth year-to-date in retirement wealth and insurance and annuities was offset by continued moderation in group benefits insurance experience. We continue to make targeted investments in a number of areas to improve health outcomes, enhance the customer and advisor experience, and increase operational efficiency. John will provide further details on the near-term outlook for the business. Europe remains on track to achieve its objective of mid-single-digit plus base earnings growth, supported by strong top-line sales across product lines. Finally, Capital and Risk Solutions continues to deploy capital opportunistically and generate attractive returns, especially in its capital solutions business. Strong global demand for our capital solutions offering drove year-to-date base earnings growth of 30% compared to the first nine months of 2025. Overall, I'm very pleased with the performance so far this year and remain confident in our ability to deliver against our medium-term objectives. I now pass over to John to talk through the broader financial results for the quarter.

Thank you, David, and good morning.

Please turn to slide A. Great West delivered another strong quarter with double-digit base earnings per share growth, driven by continued strength in our retirement and wealth businesses and robust demand for capital solutions in our CRS business. These results generated a base ROE of 19.4%, in line with our medium-term objective of 19% plus for the third consecutive quarter. This strong performance was achieved despite heightened market volatility and higher interest rates, underscoring the resilience of our business mix. As David mentioned, retirement and wealth now contribute more than 50% of base earnings, while our disciplined capital deployment approach continues to create value. During the quarter, we repurchased approximately $340 million of common shares, supporting the 11% growth in base earnings per share. Since the beginning of 2026, we've repurchased approximately $1.3 billion of common shares. Turning to slide nine, total credit losses were within our... Expected range of four to six basis points for the first nine months, though the third quarter amount was higher than the expected quarterly rate. As a reminder, total credit experience is the aggregate of credit experience shown in our drivers of earnings disclosure, as well as in our retirement and wealth P&L statements, all of which are included in the supplemental information package. We continue to expect full-year credit experience to be within the $80 to $120 million pre-tax range that we provided at the beginning of the year. Turning now to our results by segment, starting with slide 10, Empower delivered another quarter of double-digit growth with base earnings up 15% in constant currency, reflecting continued organic growth momentum across our retirement and wealth lines of business. In retirement, we successfully closed the Milliman transaction. Adding 134 billion U.S. dollars in client assets and contributing to double-digit growth in average client assets. Net plan inflows remain positive, and we continue to expect positive net plan flows for the full year and anticipate another strong year of net plan flows in 2027 as we look forward. Third quarter retirement results included approximately 21 million U.S. dollars post-tax and one-time administrative service fees, which was offset by credit losses above our run rate expectation for the quarter. Underlying business momentum remained strong. Operating margins improved 370 basis points from a year ago. Supported by the significant operating leverage in the business. Empower Wealth continued its growth trajectory with base earnings up 28% year-over-year in constant currency. Operating margins reached a record 42%, up over four percentage points from last year, demonstrating both the attractiveness and scalability of our platform. We also saw a strong increase in net sales at Empower Wealth of approximately 40% quarter-over-quarter. We expect this strong momentum to continue into the fourth quarter. Overall, strong business momentum drove Empower's base ROE to a record 22.9% on a trailing 12-month basis. Reinforcing our confidence in delivering double-digit base earnings growth into 2027. Looking ahead, we intend to continue investing in the business, including for marketing and technology initiatives in the fourth quarter. Beyond this year, we expect pre-tax operating margin to be in the mid-30s for the retirement business and the high-30s for the wealth business. Turning to slide 11, base earnings in Canada decreased 6% year-over-year as continued growth in retirement and wealth was offset by moderated disability experience gains compared to the record levels in 2025. Long-term disability continues to be a focus for us. And we are taking targeted actions to strengthen early intervention, case management, and return-to-work support. We expect full-year 2027 experience to be broadly neutral, though experience can fluctuate from quarter to quarter. Underlying business fundamentals in our Canadian operations remain strong. Retirement and wealth benefited from higher fee income. Group benefit sales more than doubled from a year ago, and insurance and annuity sales increased 17% year-over-year. Please turn to slide 12. In Europe, base earnings increased 3%, driven by higher global equity markets, a strong group benefits enforce book, and growth in trading activity. These were partially offset by moderated insurance experience. from the elevated levels seen last year. Business momentum continues to be strong with sales growth of over 50 percent across all the retail product lines. Bulk annuities, which tend to be lumpy, moderated sequentially. We continue to have a positive outlook on this market, but we will act with discipline. For the first nine months of 2026, base earnings grew 6% year-over-year in line with our medium-term objective of mid-single digits plus growth, reinforcing our confidence in the long-term outlook for the European business. Turning now to slide 13. Capital and Risk Solutions delivered another quarter of strong performance with base earnings growth of 17%. Our capital solutions business continues to see strong global demand, driving a 38% year-over-year increase in the run rate insurance result in the quarter. Well, the pipeline remains robust. We expect mid-single-digit plus growth going forward as new business volume and insurance experience normalizes. Turning now to slide 14, base capital generation exceeded 80% of base earnings in the third quarter, while free cash flow, inclusive of the Milliman transaction, was largely in line with base earnings. This underlies Underscores, the strength of our organic capital generation and the benefits of our capital optimization efforts. This high degree of capital fungibility supports continued capital deployment while preserving balance sheet strength. Although investment in our attractive growth opportunities... And our more capital-intensive business may influence base capital generation, we expect Great West to remain highly cash-generative over time. Turning to slide 15, the strength of our free cash flow generation continues to support meaningful capital deployment. For the first nine months of 2026, we repurchased approximately $1.3 billion of common shares and closed the acquisition of Milliman's retirement and benefits administration business in the United States. We are happy to report that we expect our share buybacks to be at a similar level as last year. And when aggregating with the capital allocated to the middleman acquisition, We will have deployed nearly $2 billion of capital in 2026. Turning to slide 16, our LICAT ratio stood at 127 percent, down slightly from the second quarter, largely driven by interest rate movements. Looking ahead. Under normal operating conditions, we expect to maintain a LICAT ratio at or above 125%, even with the seasonality in capital at CRS, which peaks in the fourth quarter. Our leverage ratio increased by two percentage points, quarter over quarter, to 29%, while Holtco Cash rose to $3.6 billion. Primarily reflecting the pre-funding of a euro bond issuance of 500 million euros in July. This funding was completed in advance to refinance an existing euro bond maturing in the fourth quarter. Excluding the impact of the financing, our leverage ratio was largely unchanged, and Holdco Cash stood at approximately $2.8 billion. We're underscoring our strong financial position. Overall, 2026 continues to be a strong year for Great West, and we're excited about the continued momentum across all of our businesses. With that, I'm going to turn it back over to David for concluding remarks and a look ahead.

Thank you, John. Please turn to slide 17. As we close out the third quarter, our performance year to date has been exceptional, with record-based earnings and base ROE in excess of our 19% medium-term target. This reinforces my confidence in the strength of our businesses and our ability to continue delivering against our medium-term objectives. As I look ahead to the coming year, Empower remains a principal growth engine, and we expect to deliver double-digit earnings growth in 2027. In CRS, sustained demand for capital solutions provides a strong foundation for continued growth. While 2026 has been an exceptional year and current demand remains favourable looking ahead, we believe the business will grow at a mid-single-digit plus pace. In Canada, while group benefits experience is expected to remain below the strong levels achieved in 2025, we remain focused on taking the actions needed to strengthen performance over time and expect insurance experience to be neutral overall in 2027. At the portfolio level, our strong capital generation and financial flexibility position us to repurchase at least as many shares in 2027 as we did in 2026. Combined with our strong dividend, this would give Great West a total payout ratio of over 75% next year, which is leading for the industry. We will remain disciplined in how we put that capital to work, balancing investment in organic growth, strategic opportunities, and continued returns to shareholders. Great West has a well-diversified portfolio, leading businesses and experienced teams executing against clear priorities. I'm confident that we can carry our momentum into 2027 and continue creating attractive long-term value for our shareholders. Thank you, and with that, I'll turn the call over to Shiba to start the question and answer portion of the call.

Thank you, David. In order to give everyone a chance to participate in the Q&A, we would ask that you limit yourselves to two questions per person. You can certainly re-queue for follow-ups, and we will do our best to accommodate if there is time at the end. Jim, we are ready to take questions now.

Thank you. And to our phone audience, we will now begin the analyst question and answer session. To join the question queue, you may press star and then one on your telephone keypad. You will hear a tone acknowledging your request. If you're using a speakerphone today, please pick up your handset before pressing any keys. And also, to withdraw your question, repeat the steps of pressing star and then one. We'll take our first question today from the line of Paul Holden with CIBC.

Thank you.

Good morning. So first question is with respect to capital deployment. David and John, as you both highlighted, highly cash generative business that continues. You mentioned share buybacks in 27, expected to be at least as much as 26. Do I read into that at all in terms of M&A opportunities that you may be looking at? Maybe the market's not really there today, or am I reading too much into that? Is M&A still a priority and you do see potential opportunities?

Thanks, Paul. Yeah, we continue to evaluate any and all opportunities in M&A within our existing geographic footprint, and I think we've expressed, you know, the past ambitions to continue to grow in power, particularly in the retirement side. The guidance... That we've given around buybacks and doesn't anticipate any major M&A. Obviously, if smaller M&A comes along, we would think of it as incremental to that outlook that we've given with the fourth quarter earnings.

Yeah, but I wouldn't read too much into it, Paul. Like, we remain sort of open to opportunities that come along. If we can get them at the right price, the right return, they're a good strategic fit, or the ad capabilities, we're very keen. And, you know, we've shown a very good track record in the past. So, it's very much just a continued, balanced position on opportunities.

Got it. Okay. And then second question, I believe is mentioned that there's a positive outlook for Empower New Plan wins in 2027. Just wondering what underpins that expectation.

I think I just can take that directly.

Sure. Yeah, happy to. Yeah, as we've shared in the past, you know, we expect net plan sales to be positive in Q4. As we shared with you, occasionally you see some lumpiness in the large and mega space. But as we look out to Q127, you know, we expect net plan sales to be... You know, north of $20 billion for the quarter in terms of contractual commitments, and we see a very, very strong year ahead. In fact, you know, as I think I've shared in the past, our organic growth rate in terms of net participant growth in the business is very strong. We're going to add close to 950,000 participants this year, excluding the Milliman acquisition. That's all organic growth. That's essentially growing our share at roughly 5% off a base of $20 million, and that would be roughly two times the rate of the market. So we're continuing to take share away from the subscale competitors. I see that trend continuing in 27, and we're really energized about the first quarter. The other thing I would say is we're very focused on the multi-product sale. On the retirement side. So, you know, we bought option tracks in 2024. We've integrated that capability. Obviously, we have the milliment acquisition. But increasingly, clients are now hiring in power on a multi-product basis. So we just got a commitment yesterday north of a billion dollars, and that commitment came with defined contribution, defined benefit, stock plan services, consumer-directed health care, and our executive services offering. So increasingly, we see that type of expansion, that product expansion occurring, both with our existing customer base of over 100,000 sponsors. But increasingly, it's part of our pursuit process and our sales process for new business. So very optimistic about the trend in 2027.

Our next question today comes from Bart Jarski at RBC Capital Markets.

Great. Thanks for taking the question, and good morning, everyone. I wanted to ask your thoughts around the Empower 401k opportunity, just given the election outcomes we saw in the U.S. this week. Any change there in outlook and timing as a result? Thanks.

Yeah, and again, I'll let you take that question directly.

Sure. Yeah, a couple thoughts on the election results. First, I'll start off by saying that retirement Legislation has been one of the areas where we've seen very strong bipartisan support. If you go back to Secure, 1.0 and then Secure 2.0. When I look at some of the leadership changes in the new Congress, Congressman Neal from Massachusetts will be the chairman of the House Ways and Means Committee, and he's probably the most astute on retirement legislation. We're very much aligned with his thinking in terms of expansion and trying to drive more plan adoption, particularly at the small corporate level. So I'd say in some respects, we're pretty encouraged. I think the big variable, frankly, will be more on the regulatory side and what we're going to see in terms of oversight and hearings, particularly as it relates to things like the fiduciary rule, private assets inside the defined contribution system. We know that Senator Warren. Who will likely take on the Senate Banking Committee chairmanship, has taken a strong stance against private assets. So I think there's likely to be some headwinds, but we're not adjusting our plan in 2027. We're sticking to the guidance that we've given. We continue to see very strong, robust growth in the retirement side of the business and, of course, double-digit growth for the earnings growth for the business overall in 2027.

Okay, great. Thanks. That's helpful. And then sticking with Empower, the margin outlook that you provided, maybe a two-parter. On retirement, mid-30s, you're already tracking at mid-30s year-to-date. So just wondering why would an operating leverage drive a more rolesier outlook there? And then on the high 30s for wealth, it's an incremental step down versus the year-to-date margin. So just give us any thoughts on what are driving those dynamics. Thanks.

Sure. More than anything, it's investment. You know, I just called out on the workplace side the investments that we're making to build out our multi-product capabilities. So we're expanding distribution there to drive better product penetration with both existing clients and prospective clients. So we are continuing to make investments there. We're also making a pretty material investment in our brand. We've upped that spend pretty dramatically over the last several years. We're looking for roughly a 20% increase in total spend in 2027. So that, I would say, more than anything, is what's attributable to some of the moderation on the margins. That being said, I do see us continuing to make really strong progress in lowering unit costs. We've shared with you before that we're looking to reduce unit costs by 10% to 15%, and we're on track to do that, and I think there's opportunities for us to exceed that as we continue to leverage pretty aggressive AI rollout across the business. So, very optimistic about expense discipline and operating leverage from that perspective, but we are clearly investing in the business. Both in terms of technology, brand, and distribution capabilities.

Got it. That's helpful, Culler. Thanks for taking the questions.

I would just add, on the wealth side, we are adding distribution there, too. So, we have over 1,000 advisors today. We'll be adding more to meet the demand and the opportunity that we see.

Our next question will come from Gabriel DeShane at National Bank.

Hey, good morning. I have a question about the, well, I guess similar to the one I had last quarter, but just an update, I guess, on the group business in Canada. You had record positive experience last year. This year, it's still positive, but trending more negative, I guess. And you talk about the actions you're going to take, claims management, I suppose. But what about the repricing outlook? Is this something that is addressable fairly near term? I guess it's probably too hopeful to anticipate something beyond a neutral experience next year if you're repricing it by a certain amount.

Thank you, Gabriel, for the question. Fabrice here. The benefits of long-term disability experience, as you said, continues to be below the strong levels that we've seen in the past couple of years, and especially in 2025. As I've mentioned last quarter, the deterioration is due to both higher claims incidence and also lower claims recovery. And what we've seen in Q3 is consistent with what we've seen in Q2, but perhaps... A bit more incidence pressure and a bit less. Recovery pressure, so there's a change in mix, and the incidence pressure based on the industry information we have would be consistent with what the rest of the industry is seeing. On the second part of your question and the actions, of course, we're strengthening early intervention, we're strengthening case management, strengthening return-to-work support. This is a business that's cyclical, and we've had very good results historically managing through cycles, and we continue to manage through cycle on what we can control. On the pricing front, it's definitely part of our toolkit, and we take into account the current experience that we see in our pricing posture. But I'm not going to make further comments specifically on pricing. I might say that just technically the way pricing works, this business is annually renewable for the most part. And there is a cycle of 12 to 18 months for any pricing action, the time for pricing to be established and negotiated and to come into force on a rolling 12-month basis. So that's what you can expect for pricing action. But I think we've mentioned expectations for neutral experience next year. I think that's a cautious and appropriate view, given the experience that we're seeing and the length of cycles that are typical in disability.

Yeah, I guess the pricing thing that comes to mind, I mean, simplistically, we can all assume, oh, yeah, they can reprice. I mean, it's not the only lever, of course, but, you know, since other companies are experiencing the same issue, it's going to be a hard market and, you know, repricing is going to be easy. My words, not yours. But, you know, you're also dealing with. You know, small to medium-sized businesses that are in a, you know, low-growth economy, dealing with trade uncertainty, inflation, a whole bunch of other factors. Like, how easy is it to push through higher pricing?

Without getting into the details of our strategies, I might say that one factor you need to add is also where we were in 2025 versus industry historicals. And as I mentioned earlier, incidents at the industry level was... Very low by historical standards in 2025. So in our view, it's unlikely that we in the industry would get back to these very high experience levels, especially as it relates to incidence experience. However, any long-term trend and experience can be and should be reflected in the pricing. We've also seen in the recent past... And some players being quite aggressive with right caps guarantees that limit the ability to reprice on an annual basis. We've been cautious on this, and we will continue to be cautious on this, especially in the current environment. So there's multiple levers here on pricing.

Got it. Now, I'll sneak another one in on CRS. Apologies, but our business has been, you know... Massively outperforming your mid-single-digit growth target, which you've maintained for next year. And I get that because there's more episodic sales, kind of short-term contracts, goes through that line. But you've got to have a pipeline, so there's got to be some visibility. Is that return to mid-single-digit growth just... You know, kind of reiterating your investor day targets, or do you expect to perform it based on, you know, what you're seeing in a pipeline?

Thanks, Gabe. Thanks for the compliment. I guess we're pretty happy with the year that we're having, and we've been, as I mentioned before, very opportunistic. We've seen some great opportunities. We've taken them. I think when you look at our mid-single digit, you probably should look at it on a longer-term basis, like a medium-term basis, as opposed to just year by year. I think that this year was a great year. When I look at the pipeline, there's still lots of demand for capital solutions, so it's still looking good. I think some of my pipeline versus last year's, maybe smaller deals, more deals, but smaller. So, I would say that our mid-single bidget is still a good number. We've also had fantastic experience this year, which is harder to count on. And so as you can see on the Canadian side, it comes one year and you may not get it the next year. So I think that when you look at our numbers, I think mid single digit plus is a good target.

All right. Thanks.

Our next question will come from the line of Mike Rizvinovic at Scotiabank.

Hey, good morning. I wanted to stick with CRS just to get a better sense of, you know, I get the mid-single-digit plus, and, you know, it could be mid-single-digit, it could be plus. It seems like it's been, to Gabe's point, a very strong business. I'm just wondering, is this an industry trend more broadly, or is this something that Great West is just doing better than others? Is this more of a market share capture? I know it's hard to even size the market, I imagine, in terms of addressable market, but is this industry or something that Great West is just really good at?

Maybe I'll just open up. There is certainly an industry dynamic here. We're sort of very focused on capital generation and being efficient on that point. So we deal with external reinsurance parties as well. So there is very strong demand, I think, across the insurance industry and in all different geographies on better capital management and management of their balance sheets. And then we just have fantastic positions over time and relationships with all of the insurance companies. So we're leveraging off that.

So Jeff, you might add some more color. Yeah, no, I agree. I mean, if you look at other reinsurers, I think most people are having pretty good years because the experience has been good in reinsurance. I think on the PNC catastrophe side, we didn't see a hurricane until October 1st. That's, first, the... First time ever, I think, in the Atlantic that we haven't seen any experience there. So there is. Good experience. So that's a phenomenon. I think that we've explained to you guys how we think that the capital solutions we sell are probably better value than other ways to get capital. And so I think that there's a wave of people who are thinking that way. And so we're riding that wave a little bit. But at the same time, we were the very first one pushing this wave. And so we're very well positioned. We've got the right expertise, the right brand, and certainly the right balance sheet to accommodate our clients. So it's been a little bit of both.

And are you seeing more competition in that capital solution space specifically?

Yeah, that's a good question. So there is, as I said, the experience has been good. There's been more capital invested in reinsurance in the last two or three years than ever before. I think some of it is to go after these asset transactions, which we're not really part of. You've seen a lot of sidecars and new companies in Bermuda that are set up with this. And then some of the large reinsurers, because of the good experience, have gotten more capital to invest. And so there's more capital chasing transactions. So there is a bit of that. There's more competition. But again, we're very well placed. And I think we're a leader in the capital solution business and will remain a leader there.

Okay, thanks. And then just maybe a quick one for John or David, just on the buyback. It sounds like you're committed to the $1.6 billion or the same buyback level at least versus what you're going to do in 2026 for next year. And what's the parameter if there is no M&A opportunities? Like, are you looking to potentially increase that buyback?

Yeah, so let me start and add to my comments to Paul. You know, obviously the buybacks are now a regular feature of our capital allocation tool set. This is the second year in 2026 that we'll have done $1.6 billion or so buybacks, and we happen to also have an M&A transaction this year, which I'd characterize as. A smaller end. And we look at that as a number that we're going to take into 2027. We're going to have, you know, in normal market conditions, if there isn't a significant M&A transaction that comes our way, we're going to have capacity beyond the $1.6 billion. So if you think of our guidance, you know, 8-10% earnings growth, 80% capital generation, and a dividend payout around 50%, we're generating, you know, 30% excess capital a year. And we have a really strong balance sheet with, you know, over $2.5 billion of free cash sitting at the whole coast. So that could go up and down, but our priority, number one, maintain a strong balance sheet. We have a lot of volatility in the world. Number two, continue to grow our organic business, pay out a stable dividend, and then it's the tradeoff between any M&A opportunities that come or we're not going to allow cash to accumulate on our balance sheet in perpetuity. We'll continue to push on that buyback, and we think a reasonable place to start next year is the $1.6 billion we've done the last two years.

That's a very helpful caller. Thank you.

And a reminder to our phone audience that it is star and one if you would like to ask a question or if you have a follow-up. We'll move next to Tom McKinnon with BMO Capital Markets.

Yeah, thanks and good morning. I appreciate the guide on the M-Power, both retirement and wealth margins, and the outlook there. Maybe you could elaborate on what you see for Canada wealth and retirement with respect to those margins. The Canada wealth's been around 20, and the retirement's been around mid-30s. How do you see that outlook trending into 2027 and beyond? Thanks.

Thank you, Tom, for your question.

As it relates to Canada Wealth, we're pleased with the performance of the business. We're investing in the business, as we've mentioned before. Examples of that would be the merger of our wealth dealers following recent acquisitions that was done on October 1st and announced then. We're rolling out new technology tools. All of this. We'll create a little bit of pressure on margin, but that's part of our plan, so you can expect 18% to 20% margin as we look forward on the Canada Wealth business. On the retirement business, I think the level of margins that you've seen recently are relatively sustainable. We continue to invest in the business. There's significant market and operating leverage in that business. So under normal market conditions, you can expect these margins to persist. Of course, that's sensitive to the market levels. Very pleased with the performance of the retirement business as well. We're seeing strong growth year over year, supported by market, but supported also by investments that we're making in the business, and you're probably seeing some improvement in flows in retirement, which we're quite pleased by.

Thanks for that.

And ladies and gentlemen, that concludes our question and answer session for today. I'm happy to turn the floor back to you, Mr. Kahn, for any additional or closing remarks.

Thanks, everyone, for joining us today. Following the call, a telephone replay will be available for one week, and the webcast will be archived on our website for one year. Our fourth quarter and full year 2026 results are scheduled to be released after market close on Wednesday, February 10th. With the earnings call starting at 9.30 a.m. Eastern the following day. Thank you again, and this concludes our call for today.

This brings to a close today's conference call. You may disconnect your lines, and thank you for participating, and have a pleasant day.