Good morning, and welcome to Lazard's Third Quarter and First 9 Months 2025 Earnings Conference Call. This call is being recorded. At this time, I will turn the call over to Alexandra Deignan, Lazard's Head of Investor Relations and Treasury. Please go ahead.

Good morning, and welcome to Lazard's earnings call for the third quarter and first 9 months of 2025. I'm Alexandra Deignan, Head of Investor Relations and Treasury. In addition to today's audio comments, we have posted our earnings release on our website. A replay of this call will also be available on our website later today. Before we begin, let me remind you that we may make forward-looking statements about our business and performance. There are important factors that could cause our actual results, level of activity, performance, achievements or other events to differ materially from those expressed or implied by the forward-looking statements, including, but not limited to, those factors discussed in the company's SEC filings, which you can access on our website. Lazard assumes no responsibility for the accuracy or completeness of these forward-looking statements and assumes no duty to update them. Please note that unless we state otherwise, all financial measures we discuss today are non-GAAP adjusted financial measures. We believe that these non-GAAP financial measures are meaningful when evaluating the company's performance. A reconciliation of these non-GAAP financial measures to the comparable GAAP measures is provided in our earnings release and investor presentation. Hosting our call today are Peter Orszag, Lazard's Chief Executive Officer and Chairman; and Mary Ann Betsch, Lazard's Chief Financial Officer. I'll now turn the call over to Peter.

Thank you, Ale, and thank you to everyone for joining today's call. We are pleased to report another quarter of strong results, reflecting an ongoing focus on our clients and continued momentum behind our long-term growth strategy. For the first 9 months of the year, total firm-wide revenue was $2.1 billion, including record financial advisory revenue of $1.3 billion. Financial Advisory was active during the third quarter with strength in M&A across health care, industrials, and consumer and retail in restructuring and liability management and in primary and secondary fundraising. Our recruiting efforts have resulted in 20 new MDs joining Lazard so far this year with world-class talent attracted to our premier brand and our vision for the future. Overall, financial advisory performance has demonstrated how our commercial and collegial approach is producing results by capturing new business opportunities. Looking ahead, we see an increasingly constructive environment for advisory activity, which I will discuss later. In Asset Management, it is now clear that 2025 is an inflection point for the business. For the first 9 months of the year, revenue totaled $827 million. And in the third quarter, revenue was up 8% year-over-year. Improved investment performance, our increased focus on key products and strategies and more favorable market conditions have resulted in record gross inflows for the third quarter and for the first 9 months of the year. Year-to-date, we have achieved net positive flows of $1.6 billion with total AUM up 17%. We look forward to welcoming Chris Hogbin as our CEO of Lazard Asset Management in December, helping to further accelerate our progress and evolve this business for future growth. Let me now turn the call over to Mary Ann to provide further details on the quarter's results, and then I'll share more on our outlook and the successful execution of our long-term growth strategy, Lazard 2030.

Thank you, Peter. Today, we've reported record third quarter firm-wide revenue of $725 million, up 12% from the same time last year, driven by activity across both our businesses. Financial Advisory revenue totaled $422 million, up 14% from 1 year ago. Lazard participated in several marquee transactions during the third quarter, reflecting collaboration across banking teams and the strength of our global franchise. Completed transactions include Mallinckrodt Pharmaceuticals' $6.7 billion combination with Endo Pharmaceuticals, Ferrero's $3.1 billion acquisition of W.K. Kellogg, Altice France's landmark agreement with creditors, and Sixth Street on its investment together with a consortium led by William Chisholm to acquire a majority controlling interest in the Boston Celtics in a deal valued at $6.1 billion. Recently announced transactions include Keurig Dr. Pepper's $23 billion acquisition of JDE Peet's and planned subsequent separation into 2 independent companies and Caithness Energy on multiple transactions, including the $3.8 billion sale of assets to Talen Energy. In addition, corporate restructuring assignments include company roles with Anthology, CityFibre, and Saks Global. We also engaged in several private equity assignments, including advising Norvestor on a continuation fund, advising on the closing of Nexus Capital Management Fund IV and Pacific Avenues Fund II, and advising on capital structure and capital raises for Morrisons and Tennant Holdings. Turning to Asset Management. For the third quarter, revenue was $294 million, up 8% compared to the third quarter last year and up 10% on a sequential basis. Management fees for the third quarter increased 6% compared to the third quarter last year and increased 8% sequentially. Incentive fees were $9 million in the third quarter compared to $3 million in the third quarter last year. Average AUM for the third quarter of $257 billion was 5% higher than the third quarter of 2024 and up 8% on a sequential basis. As of September 30, we reported AUM of $265 billion, 7% higher than both September 2024 and June 2025. During the quarter, we had market appreciation of $12 billion and net inflows of $4.6 billion, partially offset by foreign exchange depreciation of $400 million. We see ongoing client engagement and demand across our investment platforms, particularly with our quantitative and emerging market strategies. Illustrative examples of this include $3 billion from a Korean institution into Global Equity Advantage, $1 billion from a U.S. public fund into International Equity Advantage and $1 billion from a U.S. financial intermediary client into emerging markets equity. In addition, we received over $1 billion from a Netherlands-based client for a custom U.S. equity mandate and approximately $900 million from a U.S. institutional investor into international quality growth. Now turning to expenses. For the third quarter of 2025, our compensation expense was $475 million, resulting in a ratio of 65.5% compared to 66% for the third quarter 1 year ago. Our non-compensation expense for the third quarter was $149 million, equating to a ratio of 20.5% compared to 21.4% for the third quarter last year. We are maintaining a disciplined approach to our expenses while investing to support long-term growth. This includes substantially expanding our team of financial advisory managing directors and opening new offices in the Middle East and Northern Europe this year. It also includes the build-out of our ETF business in asset management with 6 strategies launched in 2025 and more to come. Shifting to taxes. Our effective tax rate for the third quarter was 21.4% compared to 32.5% for the third quarter of 2024. As an update to our tax guidance, we currently expect our full year 2025 effective tax rate to be around 20%. Turning to capital allocation. In the third quarter of 2025, we returned $60 million to shareholders, including a quarterly dividend of $47 million. In addition, yesterday, we declared a quarterly dividend of $0.50 per share. Now I'll turn the call back to Peter.

Thank you, Mary Ann. Firm-wide client engagement remains strong. While the U.S. government shutdown may temporarily affect the timing of deal approvals among other potential effects, we see an increasingly improving environment for financial advisory activity. In any moment of turbulence, there is also a substantial opportunity for our clients as they navigate shifting geopolitical and macroeconomic landscapes as well as advances in AI. Demand for M&A continues to increase, while restructuring and liability management activity also remains strong as businesses reposition to address evolving market conditions. Our expanded connectivity to private capital positions us well as private equity comes back onto the playing field and demand remains robust for secondary and continuation funds. This is occurring across all our major geographies, including the United States and Europe as well as now the Middle East, further underscoring the diversification of our business. We are also making steady progress toward our long-term growth goals. We remain on track this year to achieve or exceed our 2030 objective of expanding our team of financial advisory MDs by 10 to 15 net per year with significant hiring already this year. On productivity, we achieved average revenue per MD of $8.6 million during 2024, 1 year ahead of schedule. And since then, average revenue per MD has increased to almost $9 million. We remain confident in our ability to continue raising productivity, including beyond our 2028 goal of average revenue per MD of $10 million through our focus on mandate selection, our disciplined fee structure, the quality of our managing directors and our ongoing emphasis on a commercial and collegial culture. Turning to asset management. We have made significant strides in sharpening our focus on the areas of the market where active management is most likely to add value to clients, leading to improved flows this year. Active management plays a particularly valuable role for clients, where information is imperfect and where technology can be applied to generate excess returns. This includes quantitatively driven strategies, emerging markets and customized solutions that are not readily available in the broader market. These strategies have delivered significant outperformance this year and represent especially promising future growth opportunities. At the same time, and as we have emphasized before, our sub-advised funds associated with U.S. multi-manager mandates have different dynamics from the rest of our asset management business. These funds have disproportionately contributed to outflows over the past few years, which we have more than offset in 2025 due to our focus on the areas of the business that represent growth opportunities. With 97% of our asset management revenue already outside of this sub-advised category, our prospects going forward are strong as our efforts to strategically reposition the business take hold. Looking forward, we believe that we can also expand our range of offerings to reach new clients, including through active ETFs. In the third quarter, we launched 2 new active ETFs, the Lazard U.S. Systematic Small Cap and listed infrastructure ETFs, bringing our total to 6 in the United States. Our ETF platform is off to a solid start as we bring our leading strategies to more investors with further global expansion in the coming months. In addition, we are excited to welcome Chris Hogbin as CEO of Lazard Asset Management later this year. His collaborative leadership style and experience in building and growing a global asset management business will help us to meet clients' evolving needs and accelerate progress toward our long-term strategy. Across Lazard, we are focused on key differentiators that support our ability to deliver for our clients and shareholders. Lazard has long been recognized for our unique combination of insight into business and geopolitical trends. Building on the success of our world-class geopolitical advisory group, we are honored that Erik Kurilla, retired Four-star U.S. Army General and former Commander of U.S. Central Command, has joined Lazard as a senior adviser. His expertise is particularly valuable given client interest and ongoing developments in the Middle East and our expansion in that area of the world. Clients turn to Lazard for the most sophisticated advice and investment solutions, and we succeed with the unrivaled collective intellectual capital of our firm. With AI, we have the capability to meaningfully scale this capital while reinforcing the importance of client relationships. Helping to further advance our efforts, we are pleased that Dmitry Shevelenko, Chief Business Officer of Perplexity, has joined Lazard's Board of Directors. She is already contributing to our efforts to become the leading AI-enabled independent financial services firm. Finally, as I've recently completed 2 years as CEO, I wanted to take a moment to reflect on our progress to date and the road ahead. In pursuit of our long-term growth strategy, we set forth several objectives in Financial Advisory to boost revenue by increasing average productivity per MD and by expanding our team of managing directors and in asset management to achieve a more balanced flow picture this year by strengthening our research platform and by focusing our distribution efforts on key products and strategies. We are successfully executing against our plan in achieving these objectives as demonstrated again this quarter. We continue to evaluate our overall success across 3 dimensions: relevance, revenue, and returns. Our goals remain consistent to double firm-wide revenue from 2023 to 2030 and deliver an average annual shareholder return of at least 10% to 15% per year over that same period. While early results are quite promising, what I am most proud of is the degree of cultural change across the firm. Building on our long-standing commitment to excellence, we have meaningfully raised our ambitions and our collaborative approach. We have also transformed our Managing Director group in Financial Advisory through hiring and promotions and with heightened expectations for commercial outcomes and collegial behavior. At Lazard, we are playing to win and playing to win together. We are only at the start of realizing the sustained advantage that our reenergized culture creates, and we are confident that our success in creating very strong organizational health will increasingly pay off in results as we move forward. This early success and momentum are the result of our colleagues' dedication to our clients and commitment to realizing this vision for our future. And to them, I extend my appreciation and respect. Now we'll open the call to questions.

We'll take our first question from Alex Bond with KBW.

Peter, maybe just to start on the hiring environment. It seems like the backdrop and your competition for senior talent appears to be relatively high at the moment. And you've noted that you expect to be at or near the high end of your targeted net MD addition range for the year. Can you just walk us through how you're thinking about balancing bringing on strong talent, who can add to the revenue base while also considering how that impacts the ultimate level of comp leverage moving forward? And then also curious how talent retention fits into this narrative, just given your peers also remain active on the hiring front as well.

We've had significant success attracting talent to the platform, creating a renewed sense of energy at Lazard. There is considerable excitement around our progress in various sectors such as industrials, healthcare, the Nordics, the Middle East, FIG, and private equity, among others. The quality of new hires is impressive, not just in their individual backgrounds but also in their previous affiliations. We're optimistic about this development. On the other hand, we have experienced very few regrettable departures, and our pool of Managing Directors remains robust. An internal survey indicated extremely high engagement scores among MDs in financial advisory, underscoring our organizational health. The rationale behind our hiring is to drive long-term growth and enhance productivity per MD. A key point to emphasize is that a significant portion of compensation leverage comes from increasing productivity. The reason for this is that the costs associated with supporting a more productive partner do not differ significantly from those linked to a less productive partner. Therefore, as we improve productivity per MD, we achieve substantial operating leverage because the proportion of non-MD compensation to revenue decreases. We are committed to bringing in individuals whom we believe will be very productive in the future and have strengthened our hiring process to boost our confidence in this. Early results from recent hires suggest we are on the right track. I am confident that the new team members we are recruiting will contribute to improved productivity over time. This gives me optimism that as we look beyond 2028, we will continue to advance our productivity goals per MD. I believe achieving around $12.5 million by 2030 is very feasible.

Great. That's helpful. And maybe just switching gears for my next question, but maybe if you can just speak to the recent success you've had driving those inflows in the Asset Management unit. And to the extent these recent inflows are being driven by new client wins. I mean it sounds like the geographic distribution here, there's a pretty good mix. And then also curious as to your confidence level in achieving net neutral flows for the year now that we're a decent way into the fourth quarter.

Sure. Regarding the first part of your question, we are observing significant inflows in certain areas of our business, particularly in our quantitative and systematic strategies, emerging market equities, customized solutions, and global listed infrastructure. Additionally, our sustainable products are gaining interest among European investors. In terms of geographic diversification, most of our current unfunded mandates, around 80% to 95%, are targeted at products and strategies outside the United States. This global reach is advantageous for both our product offerings and distribution. Looking at the year overall, I set a goal for flat or net zero flows, which some might have doubted was achievable. However, the year-to-date results are impressive, especially considering the initial skepticism. As we near the end of the year, we aim to reach that target, and based on current trends, things appear very promising. We've also been successful in winning new mandates, including two I was informed about just this morning. While we are experiencing positive net flows overall, there are notable shifts in the business towards promising areas, such as quantitative equity strategies and customized solutions, indicating a clear preference for active management in those sectors. Although we are seeing some outflows from large sub-advised accounts, the inflows into the more innovative areas of the business highlight our confidence in the effectiveness of active management strategies.

Our next question will come from Jim Mitchell with Seaport Global Securities.

I would like to follow up on the discussion regarding the Asset Management business. You mentioned record gross inflows. Are you noticing any changes in the trends of gross outflows, not just within the sub-advisory group but more broadly? The trends you've disclosed indicate that your gross outflows remain relatively high. Are you seeing any improvement in that area?

Yes. Gross outflows are lower than they were last year. And again, they're disproportionately accounted for by the sub-advised accounts. So if you were to do a net flow picture outside of sub-advised accounts, the trajectory looks even more promising, and I think that may be an important way to consider things given that 97% of our revenue is outside of that category. So that might be a paradigm that's worth continuing to highlight on a going-forward basis.

Okay. When considering Asset Management and its turnaround, there's significant momentum, especially if the markets remain stable heading into next year. It appears that there's increased operating and comp leverage in that business. Does this ease the requirements on the Advisory side to reach the 60% target? How are you feeling about the possibility of achieving that 60% in the intermediate term? Any thoughts on reaching that goal?

I am confident that we will see operating leverage increase further in 2026, which will help us reduce the compensation ratio. I do not want to set a specific timeline as it depends on various factors. Let me explain some elements that will contribute to operating leverage over time. First, there will be ongoing improvement in productivity per managing director. Additionally, there are temporary effects related to our recent large-scale hiring. When we bring in new employees, there is a temporary adjustment period that can lower productivity per managing director or increase the compensation ratio, as they acclimate to the platform. As these new hires gain experience, we expect an improvement in productivity moving forward, even with a high hiring rate, as these are transitional effects from our more aggressive hiring strategy in the past couple of years. On the asset management side, we anticipate operating leverage from inflows and our focus on strategic scaling. While many factors contribute to operating leverage, on the advisory side, much of it comes from revenue per managing director, and on the asset side, it comes from strategic scaling rather than just overall scaling. These are key metrics we are monitoring for operating leverage. Additionally, there are numerous other factors related to finding efficiencies in our processes through advancements like artificial intelligence, but these are two significant drivers on each side of the business.

Our next question will come from Brennan Hawken with BMO Capital Markets.

First, Peter, I'll definitely caught to it. I was one of the doubters in you guys getting and turning around the flows as quickly as you did. So no question there, just tip of the cap.

Thank you for that, much appreciated.

You're welcome. I'm impressed with how well it's gone. And you still have leadership inbound. So actually, I'll turn it into a question. I know we've got new leadership coming in December. When do you think it's realistic for the analyst and investor community to hear Chris' plans for the business? I know he's not started yet, but I also, I'm sure about executive of that caliber I doubt he didn't start hatching plans when going through the whole hiring process and interviewing process. So how long do you think it will be before we'll get an idea or at least a framework of what he's thinking?

I think it will be relatively fast. We do want him to find his way around the hallways and what have you. But to your point, he's a very experienced leader in the space, so comes into this with that advantage. And I think has a very good sense of our business and the opportunities for it. So to be specific, let's say, January, maybe or at least January or February, when we want to get past our fourth quarter results, but sometime in that time frame, it's not going to be 6 months.

Right. Okay. We'll call it at some point in the first quarter.

Okay, that's great. We're happy to set up the appropriate kinds of discussions.

Perfect. Okay. And then thinking about Advisory, right? So you've done a lot of changes. You've spoken to bringing up the productivity number and the productivity numbers that improved really quite well under the new strategic direction. And so all that's really encouraging. I'm guessing this might have changed how we think about the mix within Advisory. So can you give us maybe like a high-level sense of the major buckets within Advisory. And if you want to talk about it on like an LTM basis or like how it's been trending recently versus maybe historical levels, like how does it break down in between like M&A, PCA, like there is a Private Capital Advisory business, your Restructuring business, the major buckets that you would break it into. How does that break down versus the history? And has that changed a lot?

Yes. I would like to highlight a couple of differences compared to historical trends while we discuss this. Firstly, in terms of M&A versus non-M&A activities, over the past year, the split has been approximately 60-40 in favor of M&A. However, this quarter, the mix has shifted closer to 50-50, with noticeable growth in some of our other Advisory Services. Secondly, there is a shift in the balance between public companies and private capital, where we are moving towards a more balanced distribution than what Lazard has experienced historically. This quarter had a slight skew towards public companies, but that is just a normal variation from quarter to quarter. In summary, we should expect substantial growth, not only in the M&A segment of our business but also as we expand our Fundraising, Restructuring, and Liability Management services, which are approaching half of our business. I believe this is a reasonable medium-term goal, while we continue to strengthen our core M&A offerings globally.

Our next question will come from Brendan O'Brien with Wolfe Research.

I guess just following up on one of your remarks you just made, Peter, on the Restructuring business. Concerns on the credit outlook you've been building in recent weeks following comments made by one of the big banks on 2 of the recent defaults, however, at the same time, the Fed as well as other central banks have begun to lower rates, which should help to alleviate the stresses put on corporate balance sheets. So it would be great to get your perspective around whether your Restructuring business is seeing any signs of building stress at this juncture? And how you're thinking about the outlook for the business given these puts and takes?

Sure. Let me share a few thoughts on this topic. First, we don’t consider the recent high-profile bankruptcies as indicators of broader issues in Private Credit. We are currently advising on one such case, so I’ll be cautious with specifics, but that's the general takeaway. Private credit has certainly expanded quickly, and it's reasonable to anticipate some fluctuations in that market, even though it will likely remain a lasting part of the financing landscape. I don’t believe these recent bankruptcies point to any significant downturn just yet. Secondly, there has been a significant shift that may change the timing between Restructuring and Liability Management and its correlation with other Advisory Services, particularly M&A. Traditionally, when Restructuring and Liability Management thrived, M&A tended to decline, and vice versa. However, over the past decade or two, there has been a considerable increase in the disparity in performance among firms. For instance, if you examine return on invested capital and compare the top-performing firms to the median and bottom performers, you can see a striking increase in disparity—much like income inequality charts show a lot of growth at the top while the middle stagnates and the bottom declines. This growing disparity affects our understanding of the cycle, as varied corporate performance allows for a strong drive for M&A alongside significant Restructuring and Liability Management activity. Research from Stanford suggests one reason for M&A is that high-performing firms believe they can acquire lower-performing firms to enhance their operations through better management. As this performance gap widens, that incentive for M&A strengthens. Simultaneously, the number of struggling firms also increases, leading to continued Restructuring and Liability Management efforts. Therefore, we believe the current environment is one where both trends may increasingly occur together, which may not have been the case historically. Finally, regarding the markets, I diverge slightly from conventional wisdom. I believe the markets might be too optimistic about the likelihood of more than one additional rate cut from the Federal Reserve in the coming months. We can delve into why I think that later, but if I'm correct about rates staying a bit higher, especially at the short end of the curve, it would likely affect the Restructuring and Liability Management sector more than M&A. While rates are a factor in M&A, they tend to play a secondary or tertiary role, having a more pronounced impact on Restructuring and Liability Management operations.

That's a really helpful response, Peter. I mean for my follow-up, I just want to touch on Europe a bit. The expectation last quarter was that the pickup in M&A activity would be largely driven by the U.S., which the data suggests has largely played out that way. However, at the same time, it does seem like trends in Europe have been quite strong as well. So I was just hoping you could unpack what you're seeing in Europe relative to the U.S., if there's any notable divergences, and how you think those 2 fee pools will track relative to each other over the near to intermediate term?

Yes. For the quarter, we noticed a greater shift towards Europe in our revenue mix. These trends will fluctuate for us. One advantage of having a strong presence in both the United States and Europe is our ability to adapt to where activity is strongest. Regarding Europe specifically, it’s important to understand that people often mix up macroeconomic issues with what I would call micro factors. There are many outstanding European companies. Despite some challenging macroeconomic conditions, which are influenced by political polarization in various countries, there remains significant interest among European firms and considerable strength in the corporate sector. For instance, while there has been considerable concern over political unrest in France, most CAP 40 companies have only a small percentage of their operations there. This raises the question of how ongoing activity can persist in the French market despite the political situation. The simple answer is that many French companies operate globally, so while they are impacted by events in France, that is not the sole factor shaping their outlook. Lastly, regarding the M&A cycle, the next phase will involve a resurgence of private equity in M&A, particularly in Europe. The question is when this will happen, and we believe it will become more apparent in 2026, as demand from limited partners for liquidity will not be fully met by secondary or continuation funds alone but will require M&A from private equity firms. We anticipate that this will become increasingly relevant in 2026, and our investments in enhancing our connections to private capital sources will start to yield benefits in that year.

Our next question will come from Ryan Kenny with Morgan Stanley.

Want to follow-up on the earlier comment that the U.S. government shutdown could impact some deals. Could you impact which pieces of Advisory are impacted? And how quickly after the shutdown is lifted, can these deals move forward?

Sure. Many deals require some combination of SEC approval or Department of Justice and FTC approval. Any deal that depends on those approvals or other agencies outside the essential government functions could be delayed. We believe that any backlog caused by that will be resolved relatively quickly, within weeks, not months, after the government fully reopens. It's also worth mentioning that if the government shutdown lasts for a significant amount of time, the administration can change its definition of what is considered essential. If the situation starts to impact the macro economy significantly, like delaying important transactions, they might reconsider that definition. In previous government shutdowns, we haven't observed a substantial impact because the catch-up process has been quick, and we anticipate similar outcomes this time as well.

And then separately on non-comp, different topic. Any color how we should think about the trajectory here? You mentioned your ambitions to be a leader in AI. Is there an upfront investments been needed to get there?

The upfront investments in AI are, I think, modest relative to the scale of other expenditures and the returns are so high that I don't think you should be focused on the upfront investments as a material mover of the non-comp component, but more broadly. Mary Ann, if you want to come in on non-comp trajectories.

Sure. So. I would just maintain the guidance from last quarter, which is we're still expecting a high single-digit increase in dollars year-over-year, high single-digit percentage year-over-year, but in the dollars, not the ratio. And that's driven by the same factors we've been talking about. So continued investments in technology, ongoing increases in business development, some FX headwinds, and then asset servicing fees, which are higher as our AUM has grown. So those are the drivers of the increase there.

Our next question will come from James Yaro with Goldman Sachs.

Maybe just could you help us think a little bit in more detail on the secondary's outlook from here? We've seen a very strong CAGR in this business over the past 3 to 4 years. Is anything slowing down there perhaps this year and more recently?

No, that's a straightforward answer. The trends are positive, and we expect this to continue. Some have wrongly assumed that as mergers and acquisitions and the IPO market open back up, the secondaries business will suffer. We don’t see it that way. We believe the temporary challenges from other exit strategies are just creating a brief pause for this asset class. Market participants anticipate that this will become a lasting part of the environment moving forward. The penetration rate of these products among private equity funds is still relatively low, so there's plenty of growth potential, which we are currently seeing through client engagement. Therefore, we do not expect any slowdown in our business; if anything, we expect the opposite.

Okay. Great. You were very clear about where you expect inflows and outflows to come from in Asset Management. Perhaps you could just comment on the fee rates on these outflows and inflows. And I guess just more broadly, how we should think about your fee rate in Asset Management trending going forward?

There was a small increase in the average fee rate during the quarter. This change is largely due to the fact that the incoming assets have higher fees compared to those that are leaving. Looking ahead, we do not expect any significant changes in the average fee rate. The specifics will depend somewhat on the sources of inflows within the products and strategies where we're seeing the most growth. However, a reasonable expectation is that the fee rate will remain roughly flat, at least in the short term.

This concludes the Q&A portion of today's call, and it also concludes Lazard's third quarter and first 9 months 2025 earnings conference call. You may now disconnect.