Q3 2023 Primerica Inc Earnings Call
Greetings and welcome to the primary cause third quarter 2023 earnings webcast.
At this time all participants are in a listen only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance. During the conference. Please press star zero on your telephone keypad and as a reminder, this conference is being recorded it.
It is now my pleasure to introduce to you Nicole Russell head of Investor Relations. Thank you Nicole you may begin.
And thank you John good morning, everyone.
Welcome to Primerica's third quarter earnings call a copy of our earnings press release, along with other materials relevant to today's call are posted on the Investor Relations section of our website.
Joining our call today are Chief Executive Officer, Glenn Williams, our Chief Financial Officer, Alison Rand.
And our EVP of finance and future CFO Tracy trend.
Our comments. This morning may contain forward looking statements in accordance with the Safe Harbor provisions of the Securities Litigation Reform Act.
We assume no obligation to update these statements to reflect new information and refer you to our most recent Form 10-K filings and may be modified by subsequent Form 10-Q for a list of risks and uncertainties that could cause actual results to materially materially differ from those.
Expressed or implied.
We will also reference certain non-GAAP measures, which we believe provide additional insight into the company's operations.
Reconciliations of non-GAAP measure to their respective GAAP numbers are included at the end of our earnings press release and are available on our Investor Relations website, I would now like to turn the call over to Glenn.
Thank you Nicole and thanks, everyone for joining us today.
Our third quarter results underscore the fundamental strength of our distribution capabilities and the value of our complementary insurance and investment businesses.
<unk> pre tax income is up 7% year over year, while ISP pretax income grew 9% representing the segments first year over year increase since the first quarter of 2022.
We also continued to drive growth in the size of the sales force with a 4% increase since September 32022.
Starting with a quick recap of our financial results adjusted operating revenues of $713 million during the quarter rose, 5% year over year, while adjusted net operating income of $154 million increased 9% and diluted adjusted operating earnings per share of $4.28.
<unk>, 14%.
These results reflect the steady contribution from our large in force book of term life insurance strong term life sales growth in client asset values and the benefit of higher interest rates on our investment portfolio.
Senior Health segment recorded a modest loss as we position the business for the start of the annual enrollment period.
On the capital deployment front, we repurchased $106 million of our common stock during the quarter for a total of $302 million in the first nine months of 2023.
We also paid $23 million in stockholder dividends during the third quarter given.
Given the strength of our capital and liquidity positions. We believe we will meet our targeted repurchases of $375 million for the year.
Turning now to distribution.
Both home office and field leadership remains focused on our common goal of growing the sales force the attractiveness of our entrepreneurial business opportunity continues to fuel recruiting.
During the quarter, we welcomed more than 92000 individuals as new recruits to Prime Erika. We also are also seeing solid progress in licensing with a total of 12311 individuals obtaining a new life license during the quarter pushing the size of the life licensed sales force to over 139000.
We remain confident in our ability to expand the size of our Salesforce and project around 3% year over year growth in the fourth quarter.
Turning next to the term life business.
We issued approximately 88500, new term life policies during the quarter up 9% compared to the adjusted current policy count in the prior year.
We issued $29 $5 billion in new term life protection for our clients, a 13% increase compared to the face amount issued in the prior year period.
The productivity of our Salesforce remained solid at two one policies per life licensed rep per month compared to point to zero in the prior year period.
Looking ahead, we expect fourth quarter policies issued to grow approximately 6% to 7% year over year or around 6% on a full year basis.
Let's look now at our investment and savings products business.
Total sales of $2 $2 billion during the quarter remained largely unchanged compared to the third quarter of 2022 sales of annuity products rose, 17% compared to the prior year period as annuity providers continue to enhanced products, leading to higher investment investor demand for variable annuities and the guarantee features they are.
Offer.
During the quarter. We also transitioned our managed accounts business from TD to Pershing as our custodian. This.
This conversion caused a temporary disruption in sales, which is now behind us.
Changes of this magnitude generally require a period of adjustment as advisers familiarize themselves with new technology and help their clients log in and navigate the new platform.
With the conversion complete we were able to retain 98% of client assets.
Advisors are adjusting sales levels normalized in October.
Finally sales of Canadian segregated funds are down substantially after Canadian insurance regulators, followed the lead of securities regulators and band deferred sales charges on new product sales. We are actively looking at alternative alternate segregated fund solutions for our clients in Canada.
Ending client asset values were $88 $4 billion on September 30 were 12% above the prior year period and down approximately three 5% versus June 32023 as market volatility during the quarter pressured equity values net.
Net client inflows of $192 million during the quarter reflected approximately $150 million in redemptions from the 2% acquired assets that did not convert to the new managed account custodial platform.
Based on October trends, we expect fourth quarter ISP sales to grow around 5% year over year.
We've received questions about the Dol's recent fiduciary proposal that came out on October 31.
That proposed rule was subject to a comment period and potential challenges that make it hard to draw any firm conclusions at this time however.
However, due to the nature of our ISP business and process changes. We previously adopted we believe we will be well positioned to deal with any final Dol rule.
Turning next to senior Hill during the third quarter, which is seasonally the most challenging period of the year, we saw stable ltvs for the fourth consecutive quarter.
However contract acquisition costs per approved policy of $263 as well as sales volumes were pressured by a higher mix of newer less productive agents.
Our agent Count has grown we've had higher than expected attrition of experienced agents and new hires were on boarded and trained later in the year than we planned.
We also identified an inefficiency in our use of leads which has now been corrected.
As we make course corrections to further improve our agent recruiting and Onboarding, we are moderating our expectations for fourth quarter in AEP and expect improved applications to be down over 10% from last year.
We believe that primary representatives will continue to be a valuable source of quality leads for he tell a quote and estimate their referral activity will contribute more than 20% of submitted applications hearing this year's AEP.
We remain committed to our senior health business and believe there is room for more improvement our new leadership team established sensor acquisition is fully in place, creating a strong foundation for the future we will not need to provide capital to the subsidiary in 2023, and we do not anticipate the need to provide capital in 2024.
Before turning to Alison to review of our financial results I'd like to comment on our CFO succession process. As you know Allison has announced her retirement effective April one 2024 after nearly 23 years as CFO.
Her leadership has provided tremendous financial discipline and performance, which will continue to build upon.
Allison successor, Tracy Tan has recently joined Primerica Tracy is an accomplished business leader with 20 years of experience as CFO across multiple industries, including financial services, the depth and breadth of her experience and business acumen will enable her to guide prime Erika to continued growth Tracy is working.
Mostly with Allison on the transition Tracy welcome to the primary routine.
Thank you Glenn I appreciate the vote of confidence in him.
Excited to join Primerica, Our company mission to help middle income families.
Aligned with my own personal values.
It is an honor.
Thanks Allison.
Please behind a great legacy.
I'm committed to leveraging my experience.
My primary could continue with growth and value to our stockholders.
Thank you Tracy it's great to have you on board.
Allison also want to thank you for your extraordinary leadership tireless dedication and wise counsel throughout the years, you've been an integral part of <unk> success and you'll be missed after year retirement next April.
Thank you Glenn Thank you Tracy so really that's really kind of work I do appreciate it and good morning, everyone.
Let me expand on our third quarter financial results by taking a closer look at the financial contribution of each segment.
Riding with term life, we continue to benefit from the strong profits generated by this segment.
Pretax operating income of $141 million increased 7% year over year, driven by 6% growth in adjusted direct premiums.
Based on current sales and persistency expectation, we expect ADP to continue to grow by approximately 6% year over year in the fourth quarter.
We also expect the term life segment to continue to be a strong source of free cash flow for the company.
The term life pretax operating margin with 23% in the quarter compared with 22, 8% in the prior year period.
Our term life margin and financial ratios as a percentage of adjusted direct premiums as we believe this is the best revenue basis to evaluate the format.
In doing so we view other ceded premiums which are the amounts paid to our wire T. We incur to lock in mortality costs.
The component of our benefit cost rather than a contra revenue as presented on a GAAP basis.
And our Lv Ti term life margins are expected to be stable and predictable.
Not highly sensitive to changes in persistency and mortality experienced bankers are highly mitigated by reinsurance and partially spread to future periods.
Benefits and claims DAC amortization and insurance expense ratios in the third quarter, but all consistent with the prior year period at 57, 911, 773% respectively.
We expect margins and financial ratios to remain stable in the fourth quarter.
Turning to persistency, we continue to see elevated lapses, most notably on policy sales near the onset of ore during the pandemic when various financial aid programs are widely available to middle income marketplace.
The combination of our ongoing cost of living pressures and the elimination of financial aid for Atlanta, I liked the contributors to the timing of the slack there.
Persistency for both policies issued over the last year I suppose the older policies are generally in line with the historical trend underlining underlying R. L V Ti assumption.
While economic headwinds are likely to continue in the near term, we believe that persistency experienced across all durations will revert to historical levels over time.
During the third quarter, we performed our annual assumption review we.
We did not identify any trends or experience that we believe require us to change our long term assumptions for lapses or aggregate benefit, including both mortality and disability wait for a waiver of premium right.
I can go at it.
We believe the elevated lapses seen in some policy duration will revert to historical levels over time.
In regards to mortality variances are inherently limited by our extensive <unk> reinsurance program claims.
Claims have been modestly favorable to assumptions in 2023, but we believe this is near term experience volatility in their existing L. DTI mortality assumptions continue to reflect the long term best estimate for benefit right there.
We've also seen some variability in disability rates underlying our waiver of premium benefits, which we will continue to monitor.
Turning next to the investment and savings products segment third quarter operating revenues of 219 million and pretax operating income of $64 million were both up 9% year over year.
Sales based revenues and commission expense, both rose 7% in line with revenue generating sales.
Asset based revenues increased 11% consistent with 10% growth in average client asset values.
Total expansion.
Senses on asset based products, including commission expenses and for segregated fund DAC amortization and insurance commissions increased in line with asset based revenue.
With regard to <unk>, we have seen a drop off in sales due to new regulations, but given we earned commissions based on client assets.
Which were only down 3% year over year, the impact to earnings will emerge slowly over time.
And our senior housing segment, we continue.
Excuse me in our senior housing segment, we recognized a $7 6 million loss for the quarter.
LTV per approved policy with $911, 5% increase over the prior year period.
We recorded a $2 $3 million positive Cal adjustment in the quarter to reflect the impact of stabilizing participate on imports policies and annual rate increases.
Marketing development revenues of $2 million were down slightly year over year.
Beginning in the fourth quarter, most marketing development revenues will shift from other net revenues to the commissions and fees revenue line due to a change in our contracts with certain health insurance carriers.
So generally neutral to total revenues the change will result in higher Ltvs and like most marketing development revenue opportunity directly to approved policy.
That's for approved policy of $263 was up significantly year over year based on factors Glenn described earlier.
We expect to recognize a small loss in the fourth quarter that will not need to provide capital to the segment in 2023, nor do we anticipate a need to do so in 2024.
The corporate and other distributed products segment recorded a pre tax operating income of $3 million during the quarter Keith.
A key driver of segment results with adjusted net investment income, which at 35 million for the quarter was up $11 million year over year.
Our average yield on new investment purchases for the quarter was about 6% with an average rating of double a minus and an average duration of about five years.
Parison the average book yield of maturity for the period was under 4% we.
We expect to continue benefiting from higher yields and growth in their portfolio in the fourth quarter.
Our invested asset portfolio ended the period at an unrealized loss of $343 million, which continues to reflect the steep rise in interest rates since the beginning of last year.
We regularly evaluate the portfolio for possible credit impairment and do not believe the large unrealized losses due to significant credit concerns with our holdings.
We continue to have the intent and ability to hold these investments until maturity.
Third quarter consolidated insurance and other operating expenses were $137 million at $6 million or 4% compared to the third quarter of 2022.
The increase is mainly attributable to higher employee related costs and normal growth in our business.
Costs increased less than anticipated in August due to the timing of certain technology projects and pullback in equity market that led to lower ISP asset base operating expenses than expected.
Looking ahead, we expect fourth quarter insurance and other operating expenses to increase around 4 million or 3% year over year with increases coming mainly from higher employee related costs and continued growth in the business.
This would result in full year expense growth of about 3% year over year, which is lower than typical due to heightened expense levels in 2022 from holding an additional sales force leadership event post COVID-19.
With that operator lets open the lineup for questions.
Thank you we will now be conducting a question and answer session.
I'd like to ask a question. Please press star one on your telephone keypad, a confirmation tone will indicate that your line is in the queue. You May press star two to remove your question from the queue for participants using speaker equipment. It may be necessary to pick up your handset before pressing the star keys, one moment, please while we poll for questions.
And the first question comes from the line of Ryan Krueger with <unk>. Please proceed with your question.
Hey, Ryan.
Hey, Good morning. My first question was just on expenses.
I think Alison you talked about 3% growth for the year I think the guidance last quarter was 5% growth.
One question is just what led to the lower expenses than you were previously anticipating and then what would you view as a more normal growth rate in expenses over time for the company.
Yes.
Great question, Brian Yeah, we did anticipate and I mentioned it in my prepared comments, we had anticipated in the third quarter two things one is starting to kick in on certain technology projects. At this point, we don't think will happen until more so at the beginning of next year and.
And second of all we did see pullback in equity markets. During the third quarter as Glen described and that does correlate with lower operating expenses in that segment as well because quite a bit of art classes come from fees, we pay to providers to do record keeping and the like so.
A lot of those are asset based.
So any way that those are the two big pieces that caused us to have lower expenses than we expected this quarter and we don't see a lot of that turning around or timing wise in the fourth quarter.
I do I think your point about next year on a normalized type of growth rate is in poor and I did highlight and I think we'll continue to highlight that in the 3% growth. We saw this year is a typical a lot. It really had to do with things that we incurred outside of the normal course in 2022.
Good chunk of that came from you know doing to leadership event and a convention all in one year, which is very atypical for us, but we've got backed up because of COVID-19.
So I do look at the future and I think I've said this in the past I think you should look at this business more and lets say the 5% to 7% growth rate in expenses unless you know, let's say something very specific that we have to do.
To drive the business only makes them kind of substantial commitment to two in endeavour.
The caveat around that is a lot of our expenses are really tied directly to a revenue sources. So to the extent, we see any kind of extreme fluctuations in our revenue sources say because of changes in the stock market.
That could change that perspective, but in a normal situation I would expect anywhere from 5% to 7% be the general range.
Great. Thanks, that's really helpful. And then Glenn I just wanted to follow up on the Dol proposal.
Maybe maybe one thing I think that might be helpful. Could you provide some comments on things that you already changed to prepare for the 2016 rule.
As we think about the current proposal and then just.
Just general thoughts on kind of how this proposal look to you relative to what.
Had occurred last time around.
Right well, it's it is very early Ryan as I stated in my prepared comments and lots of time for commentary from the industry and even.
Pushed back after the fact, so it's a little hard to draw an exact beat on but I do think the two things going in our favor is that our business is fairly simple compared to.
Oh.
Others other models as far as our products. It goes it's a little narrower product said it'll more simpler product set than some that are more sophisticated and as we went through this process in the last go round.
We recognized and are building our business around the fact that we are acting as fiduciaries and a number of the recommendations were making particularly around retirement accounts and so we took action at that point that we believe based on what we know today that could change will help us be already in line with some of the proposed changes for the future. So.
Our business model works in our favor to a certain extent in some areas where our product set at least and then also we did make changes.
Last time around our advice around retirement accounts and rollovers.
In anticipation of these types of ongoing changes in the future and we think that positions us for less disruption based on the way that this version of the rule might come out.
Great. Thank you.
Certainly.
And the next question comes from the line of Jeff Schmitt with William Blair. Please proceed with your question.
Hi, good morning.
The pre tax margin term life was fairly high at 23% again.
To be driven by I guess insurance expenses are kind of below historical levels, but is there anything else in that and then and how sustainable I guess would you think that is.
Yeah and to your point about expenses, it's really not that far out of historical level that does fluctuate from quarter to quarter. It was a little bit lower this quarter, but not something that I would say was completely atypical of what you might see in any quarter going forward.
When you look at it in terms of as a percentage of the get to direct premiums because remember as I said earlier a lot of the expenses didn't really move directly with premium growth.
The margin, especially with <unk> are expected to remain very very stable.
Only thing that would truly disrupt that would be is if we had an assumption change or significant assumption change and quite frankly, given the nature of our business. The fact that we so much reinsurance to mitigate exposure on mortality.
We only sell term life and we are very large homogenous book of business that we know how to predict.
And given how GAAP works these days with the straight line basis that it is not nearly as volatile based on persistency.
Really do expect our margins to stay in that relative range, you might see some creep over time, but it will be very modest.
Which I think highlights as I think I believe plant opened in his remarks, the predictability of this particular business and you know you can combine that with the generous cash flow it creates and it really become a key component of our business model and our financial business model.
Okay.
Yes.
And then on the proposed Dol rule I mean do you see your main exposure being on on ship fixed index annuities or.
Variable annuities be affected too.
Obviously, you probably made changes that in the past with regulation.
With the Reg bi but I'm just curious is that exposure really on the fixed index annuities at this stage and how.
How much of flows today are really from 401, K rollovers I mean, I know you do a fair amount.
Yes, Jeff.
It's a good add on to the question Ryan asked earlier, because our business our fixed indexed and fixed annuity business is very small it's about 5% of total sales in the quarter and that's on a pretty high end of the range. It fluctuates from between 2% and 5% of our total sales and that's a combination of both fixed annuities.
And fixed indexed annuities and fixed indexed annuities were called out in some of the discussion around the room. So I think there is some feeling that they may be.
An area of focus in this edition of the room.
Our variable annuity business, which generally runs from about 22% to 26% of sales as the mix shifts over time, obviously in volatile times mix shifts towards <unk> and their guarantees and a less volatile more predictable times it shifts back away from two non guaranteed products like mutual funds and we've seen that for years and so.
It's very common.
And it has.
Moved in a fairly narrow range. So I think I think if there is an annuity focus for us. It's a variable annuity focus which is a lot of the discussion from last time and I think it's it's a lot of what we prepared for an event around the product mix question we.
We do a significant amount of rollover business, where we can get you an exact number after the call but.
That is an area, where we recognized in advising on 401, K and other retirement plan rollovers that was the whole crux of the fiduciary question and that's where we went ahead at the last edition of the rule and made changes to make sure. We were in line with fiduciary advice around those rollovers. So that's where we believe we are.
As we understand it today again with a lot of room for change.
May be in a good position already on the rollover for it.
Okay, great. Thank you.
Certainly.
And the next question comes from the line of <unk> Kamath with Jefferies. Please proceed with your question.
Hey, good morning, guys.
Just wanted to start with the term lapse rate Allison I think on the second quarter call. You gave us some good data in terms of what you saw in the first quarter, I think 3% to 5% and what you saw in the second quarter I think you said, 5% to 7%.
If those numbers are right do you have a comparable number for the third quarter and maybe some color around how lapses trended through the quarter.
Yeah, and it's interesting one of the reasons I didn't put those exact figures first of all the numbers have I don't want to say overly improve but we have seen where the variances are have shrunk in the number of duration towards saying it. So earlier in the year. We really were same things vary across the board, which.
Really was sort of the economic hit what was going on in the marketplace. It's interesting as we've analyzed that now we're seeing it very specifically in a small number of duration as I mentioned in my comments not seeing it on the new business. The new business is really moving in line with our <unk>.
L D Ti assumptions.
And then.
On the outer years say durations five and later, it's very much in line with them with the assumptions, it's really years two through four and when you look when you look at those years you know what.
What jumped out at me is what I highlighted in the call that these were policies that people bought either right before or during the pandemic. These where people I think were real what we saw after the pandemic as we expect that a lot of policies fall off the books pretty quickly a lot.
If people didn't knee jerk purposes during the convert.
Pandemic, and then decided not to keep it post pandemic when they felt fears were forgone I believe these are people and this is my belief I believe these are people that really did want to keep their policies and have held onto those COVID-19 acquired policies for as long as they could but as you're well aware.
All of the stimulus packages that were out for a long period of time are now gone all the aid programs on loan repayments are gone.
And get the economy for a lot of people in our marketplace has been challenging cost of living has been challenging so I see those being the driving factors as to why these particular durations or buckets of policyholders are being a typically impacted so it's one of the reasons why didn't go ahead and give something overall because unlike the earlier.
Where it was really pervasive amongst durations to me. This is a very specific thing, we're seeing with which we do expect to run off and again, which is why we did not go ahead and change any long term assumptions on your LTE Ti.
Okay that makes sense.
And then I guess, maybe on senior health it sounds like there's some incremental challenges I think based on reading the press release.
Some hiring delays and then I think Glenn you had mentioned some higher attrition and then lastly.
I normally think about this business as being sort of profitable in the fourth quarter, but I think youre guiding to a law. So maybe just some color around what you're seeing there just feels like maybe it's not getting kind of back on track like we had kind of hoped it would.
Yes, youre right about the normal cadence of the business. The fourth quarter is normally the during AEP, the most significant quarter and so what we've seen is yes.
It's not mysterious in hindsight now that we see.
Of course.
It was something we were trying to control as we go but we weren't able to totally control. It is we wanted to grow the size of our sales force hiring.
Hiring new and also retaining.
Experienced reps, we got we feel like a good pool of talent out there to hire new but we didn't retain as many of our experienced salespeople as we wanted to and so what that's led to is a larger sales force, but with a newer mix of reps and the reality is the newer mix or perhaps are not as efficient.
They are.
Number of sales per lead or not as high and so that leads to the increase in cash that we saw in the third quarter and we're just anticipating that we'll see some see that again in the fourth quarter and lead to a loss in the fourth quarter small loss in the fourth quarter, rather than a small game. So it's a fairly focused.
Issue, we've taken all the actions or begun to take all the actions to deal with that.
As I mentioned in my prepared remarks, we feel very good about our leadership team. That's in place now having built or rebuilt that since the acquisition and.
And so we do have a lot of positives going on the stability and LTV, we count as <unk>.
Environmental positive that we're gaining from it looks like the the shopping and churn challenge that we had a couple of years ago that the industry had a couple of years ago.
<unk> begun to normalize so that gives us a much better environment to build a business in is just going to take some more work and take a little longer than we anticipated.
Got it maybe just one quick follow up.
Or do you think is driving the attrition of the experienced senior health folks.
I think it's a I think it's a number of factors I think that its general disruption that Allison talked about in the in the marketplace and in the economy I think people were struggling financially and therefore more likely to look for alternative employment that might give them, a more upside and a bigger opportunity.
And.
And we didn't weren't able to put our finger on any one particular item.
Obviously as we look at all of the retention aspects of our opportunity in compensation and other types of benefits. We were looking at all of that to make sure that we're competitive it wasn't any particular, one item that we can lay a finger on and have a quick fix it's just a disrupted environment that we're operating in.
Got it thanks Glenn.
Certainly happy to do that.
And the next question comes from the line of Maxwell Fritcher with <unk> Securities. Please proceed with your question.
Maxwell.
Hi, good morning, I'm, calling in for Mark Hughes.
Kind of a broad question about the recruiting environment.
It seems as though there is some opportunity for growth considering.
The payroll numbers from the Labor Department came in a little cooler than expected. It seems like it should be maybe a catalyst in your thoughts there.
Yeah. It's interesting the response I was given to some neat about senior health was about are employed sales force that he tell a quote.
Which where there is quite calm there's quite a lot of competition for employees.
Interestingly enough.
The economic disruption actually leads toward more people looking for alternatives to people that maybe looking for an alternative to their senior health sales position.
That's true of people looking for alternatives everywhere, which actually helps drive primary because overall independent salesperson recruiting so.
The dissatisfaction that's a headwind for our <unk> business actually is a tailwind for our recruiting of our overall sales force, which is kind of an interesting contradiction.
And so our recruiting is not directly tied to employment remember people are not looking for a job when they come to prime Erika that has a paycheck next Friday, they're looking for an opportunity that they can build over several years and so we don't see direct competition generally based on the tightness of the labor market.
Particularly when that tightness is created by jobs maybe that are.
Not high quality jobs that are often lower paying where people are employed but theyre underemployed, that's the perfect environment for prime Erika to recruit our larger sales force, but those people are frustrated they are unhappy and they are looking for an alternative that they control and thats. The attractiveness I mentioned of our entrepreneurial opportunity. So we're seeing a very high.
Attractiveness in this environment.
Even as the employment market tends to tighten in some months and then ease in other months as long as there are a lot of it frustrated employees, that's what we need to be able to recruit large numbers at primerica and Theres a lot of those out there. So we're not our recruiting of our primary care sales force is not subject to the changes in the labor market quite as directly.
As it might appear.
Yes, that's very helpful. That's all I have thank you.
And if I could circle back around to the questions about rollovers about a third of our U S. Mutual funds sales volume comes from 401, K Rollovers and I believe Ryan had asked that question. So Ryan if that's helpful thought I'd give you that stat about a third of mutual fund volume is four one K rollovers.
And ladies and gentlemen at this time there are no further questions and that concludes today's teleconference. You may disconnect. Your lines at this time. Thank you for your participation.
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