Q2 2026 IGM Financial Inc Earnings Call

July 30, 2026

Speaker #1: Thank you for standing by. This is a conference operator. Welcome to the IGM Financial Q2 2026 Analyst Call and Webcast. As a reminder, all participants are in listen-only mode, and the conference is being recorded.

Operator 2: Thank you for standing by. This is the conference operator. Welcome to the IGM Financial Q2 2026 Analyst Call and Webcast. As a reminder, all participants are in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. Should you need assistance during the conference call, you may reach an operator by pressing star then zero. I would now like to turn the conference over to Kyle Martens, Senior Vice President, Corporate Development and Investor Relations. Please go ahead.

Operator: Thank you for standing by. This is the conference operator. Welcome to the IGM Financial Q2 2026 Analyst Call and Webcast. As a reminder, all participants are in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. Should you need assistance during the conference call, you may reach an operator by pressing star then zero. I would now like to turn the conference over to Kyle Martens, Senior Vice President, Corporate Development and Investor Relations. Please go ahead.

Speaker #1: After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press * then 1 on your telephone keypad.

Speaker #1: You'll hear a tone acknowledging your request. Should you need assistance during the conference call, you may reach an operator by pressing * then 0.

Speaker #1: I would now like to turn the conference over to Kyle Martens, Senior Vice President, Corporate Development and Investor Relations. Please go ahead.

Speaker #2: Thank you, Jason. Good morning, everyone, and thank you for joining us. On the call today, we have Damon Murchison, President and CEO of IGM Financial and IG Wealth Management; Luke Gould, President and CEO of Mackenzie Investments; and Keith Potter, Executive Vice President and CFO of IGM Financial.

Kyle Martens: Thank you, Jason. Good morning, everyone, and thank you for joining us. On the call today, we have Damon Murchison, President and CEO of IGM Financial and IG Wealth Management, Luke Gould, President and CEO of Mackenzie Investments, and Keith Potter, Executive Vice President and CFO, IGM Financial. Before we get started, I would like to draw your attention to our cautions concerning forward-looking statements on slide three of the presentation. Slides four and five summarize non-IFRS financial measures and other financial measures used in the presentation. On slide six, we provide a list of documents available on our website related to IGM Financial's 2026 Q2 results. With that, I'll turn it over to Damon.

Speaker #2: Before we get started, I would like to draw your attention to our cautions concerning forward-looking statements on slide 3 of the presentation. Slides 4 and 5 summarize non-IFRS financial measures and other financial measures used in the presentation.

Speaker #2: And on slide 6, we provide a list related to IGM Financial's Q2 2026 results. With that, I'll turn it over to Damon.

Speaker #3: Thank you, Kyle, and good morning, everyone. Today is my 24th quarterly earnings call, and my first as President and CEO of IGM Financial. I'm excited and honored to be leading this great organization, and I want to thank James for his leadership and guidance for over the past five-plus years, and I look forward to working together in his new capacity as chair of our board.

Damon Murchison: Thank you, Kyle. Good morning, everyone. Today is my 24th quarterly earnings call and my first as President and CEO of IGM Financial. I'm excited and honored to be leading this great organization, and I want to thank James for his leadership and guidance over the past five-plus years. I look forward to working together in his new capacity as chair of our board. While many of you may know me from Mackenzie Investments and IG Wealth, let me provide a brief background for those of you who may be new to our story. I've been part of IGM's leadership team since 2014, including senior roles at Mackenzie Investments and nearly six years as CEO of IG Wealth. I've also stayed connected to the wealth and asset management businesses that are part of our strategic investments.

Speaker #3: While many of you may know me from McKinsey Investments and IG Wealth, let me provide a brief background for those of you who may be new to our story.

Speaker #3: I've been part of IGM's leadership team since 2014, including senior roles at McKinsey Investments and nearly six years as CEO of IG Wealth. I've also stayed connected to the wealth and asset management businesses that are part of our strategic investments.

Speaker #3: I'm proud of what we've built as a company—of team players united by a commitment to our clients, execution excellence, and shared success. We enter IGM's next chapter from a position of strength and momentum.

Damon Murchison: I'm proud of what we've built as a company of team players united by a commitment to our clients, execution excellence, and shared success. We enter IGM's next chapter from a position of strength and momentum. Today, I will provide my outlook on the opportunities ahead and share my priorities starting on slide nine. Since the planned leadership transition was announced in February, I've spent time meeting with employees, advisors, leaders, and partners. I've also stood back and looked at IGM as a whole. These conversations and reflections reinforce my confidence in our business and the strength of the leadership team across IGM. They also clarified where we can build on our strengths and advantages. To be clear, our strategy is working well. It's focused on the growth of our core asset and wealth management businesses, amplified by our strategic investments, and supported by disciplined capital allocation.

Speaker #3: And today, I will provide my outlook on the opportunities ahead and share my priorities, starting on slide 9. Since the planned leadership transition was announced in February, I've spent time meeting with employees, advisors, leaders, and partners.

Speaker #3: I've also stood back and looked at IGM as a whole. These conversations are reflections reinforced my confidence in our business and the strength of the leadership team across IGM.

Speaker #3: They also clarified where we can build on our strengths and advantages. To be clear, our strategy is working well. It’s focused on the growth of our core asset and wealth management businesses, amplified by our strategic investments, and supported by disciplined capital allocation.

Speaker #3: The markets we operate in are attractive, but also highly competitive. Clients' expectations continue to rise, and fee pressure remains a reality across the industry.

Damon Murchison: The markets we operate in are attractive but also highly competitive. Clients' expectations continue to rise, and fee pressure remains a reality across the industry. That makes differentiation, productivity, and disciplined execution even more important. My role is to sharpen our focus, move faster, and concentrate resources on the opportunity with the greatest potential. That work is already underway. The actions we announced in June show this approach in motion in our trajectory, simplifying how we operate so we can direct more capacity to clients, advisors, and profitable growth. Let me take a few minutes to break that down. Firstly, IG Wealth and Mackenzie are the core of IGM, comprising 75% of our earnings.

Speaker #3: That makes differentiation, productivity, and disciplined execution even more important. My role is to sharpen our focus, move faster, and concentrate resources on the opportunity with the greatest potential.

Speaker #3: That work is already underway. The actions we announced in June show this approach in motion and our trajectory—simplifying how we operate so we can direct more capacity to clients, advisors, and profitable growth.

Speaker #3: Let me take a few minutes to break that down. Firstly, IG Wealth and McKinsey are at the core of IGM. Comprising 75% of our earnings, each has distinct strengths and meaningful room to grow.

Speaker #3: At IG Wealth, our strength is rooted in our national network of financial planners, our deeply embedded financial planning culture, which fosters multi-generational family relationships, and our omnichannel approach to servicing our clients.

Damon Murchison: At IG Wealth, our strength is rooted in our national network of financial planners, our deeply embedded financial planning culture, which fosters multi-generational family relationships, and our omni-channel approach to servicing our clients. These strengths are most relevant to affluent Canadians whose financial lives tend to be more complex. Profitable growth comes from two levers that drive advisor productivity. First is increasing advisor capacity. By leveraging our omni-channel approach and using our industry-leading Planning First technology platform to ensure right client, right channel, and give our advisors more time to service their existing clients and acquire new clients. Second is increasing advisor capabilities by strengthening our value proposition around our key wealth drivers, so our advisors can solve more complex family needs and our clients can benefit from our differentiated financial planning advice across various dimensions.

Speaker #3: These strengths are most relevant to a fluent Canadian whose financial lives tend to be more complex. Profitable growth comes from two levers that drive advisor productivity.

Speaker #3: First, is increasing advisor capacity. By leveraging omnichannel approach and using our industry-leading planning-first technology platform to ensure right client, right channel, and give our advisors more time to service their existing clients, and acquire new clients.

Speaker #3: Second, is increasing advisor capabilities by strengthening our value proposition around our key wealth drivers. So our advisors can solve more complex family needs and our clients can benefit from our differentiated financial planning advice across various dimensions.

Speaker #3: At McKinsey, our advantages come from investment excellence across a multi-butique model: a leading brand known for product innovation, and multi-channel distribution strength. This includes deep relationships with independent Canadian advisors, connections across the power corp ecosystem, and growing global institutional reach.

Damon Murchison: At Mackenzie, our advantages come from investment excellence across a multi-boutique model, a leading brand known for product innovation, and multi-channel distribution strength. This includes deep relationships with independent Canadian advisors, connections across the Power Corp. ecosystem, and growing global institutional reach. Growth comes from continued product innovation and bringing our strongest capabilities to more advisors, more clients, and more institutions. Secondly, our strategic investments expand and diversify IGM's growth opportunity. These ownership interests in attractive wealth and asset management businesses connect us into different business models, client segments, and markets, and also strengthen IG and Mackenzie. Together, IG Wealth, Mackenzie, and our strategic investments give IGM distinct and complementary sources of growth and drivers of shareholder returns. Lastly, our capital allocation priorities remain consistent. We will invest first in our core businesses, where we can strengthen competitive advantages and drive profitable growth.

Speaker #3: Growth comes from continued product innovation and bringing our strongest capabilities to more advisors, more clients, and more institutions. Secondly, our strategic investments expand and diversify IGM's growth-attractive wealth and asset management businesses, connecting us into different business models, client segments, and markets.

Speaker #3: And also strengthen IG and McKinsey. Together, IG Wealth, McKinsey, and our strategic investments give IGM distinct and complementary sources of growth and drivers of shareholder returns.

Speaker #3: Lastly, our capital allocation priorities remain consistent. We'll invest first in our core businesses, where we can strengthen competitive advantages and drive profitable growth. We will maintain financial strength and flexibility as we balance disciplined investment and growth with share repurchases and dividend growth over time.

Damon Murchison: We will maintain financial strength and flexibility as we balance disciplined investment in growth with share repurchases and dividend growth over time. We will continue to concentrate on the wealth and asset management businesses we own today. To be clear, building on our strategy that is working, sharpen our focus, simplify how we operate, and invest with discipline. We will measure this progress in practical terms through better client and advisor outcomes, improved productivity, improved operating efficiency, and ultimately profitable growth and stronger earnings. I know this company well. I strongly believe in our businesses, and I'm ambitious about what comes next. Our leadership team has a strong track record of execution, and our Q2 results are the latest evidence of that. With that, let me turn to slide 11 and talk about our quarterly results.

Speaker #3: And we will continue to concentrate on the wealth and asset management businesses we own today. So, to be clear, we are building on our strategy that is working, sharpening our focus, simplifying how we operate, and investing with discipline.

Speaker #3: We will measure this progress in practical terms. Through better client and advisor outcomes, improved productivity, improved operating efficiency, and ultimately profitable growth and stronger earnings.

Speaker #3: I know this company well. I strongly believe in our businesses, and I'm ambitious about what comes next. Our leadership team has a strong track record of execution, and our second quarter results are the latest evidence of that.

Speaker #3: With that, let me turn to slide 11 and talk about our quarterly results. Adjusted EPS of $1.41 per share was up 32% from a year ago.

Damon Murchison: Adjusted EPS of CAD 1.41 per share was up 32% from a year ago. Higher average AUMA supported earnings reflecting CAD 2.2 billion in net flows and strong investment returns. We paired that growth with disciplined expense management and delivered operating leverage. Beyond adjusted earnings, the fair value of our 25% interest in Wealthsimple increased by 15% during the quarter to CAD 2.6 billion, reflecting continued growth in the business. We also returned record capital to shareholders through dividends and share repurchases. We did that while maintaining financial flexibility with more than CAD 900 million of unallocated capital and a conservative leverage profile. As shown on slide 12, the operating environment was supportive in Q2. Strong financial markets generated average client returns of approximately 9% across IG and Mackenzie. Industry flows remained positive. Markets are at or near record highs, although we've seen periods of volatility this year.

Speaker #3: Higher average AUMA supported earnings, reflecting $2.2 billion in net flows and strong investment returns. We paired that growth with disciplined expense management and delivered operating leverage.

Speaker #3: Beyond adjusted earnings, the fair value of our 25% interest in Wealthsimple increased by 15% during the quarter, to $2.6 billion, reflecting continued growth in the business.

Speaker #3: We also returned record capital to shareholders through dividends and share repurchases. We did that while maintaining financial flexibility, with more than $900 million of unallocated capital and a conservative leverage profile.

Speaker #3: As shown on slide 12, the operating environment was supportive in Q2. Strong financial markets generated average client returns of approximately 9% across IG and McKinsey and industry flows remained positive.

Speaker #3: Markets are at or near record highs, although we've seen periods of volatility this year. We remain prepared for a range of market conditions as we enter the second half.

Damon Murchison: We remain prepared for a range of market conditions as we enter the H2. On slide 13, adjusted earnings increased across all 3 segments, with both wealth management and asset management up more than 30%. Slide 14 shows our asset growth, which was not concentrated in just one or two businesses. Total AUMA increased by 19% year-over-year to CAD 622 billion, with all six of our wealth and asset management businesses higher than a year ago. This brings me back to the actions we announced in June on slide 15. We designed these actions to create more meaningful capacity to invest in the future of our businesses without simply layering on more cost and complexity. That capacity will support the next phase of our AI investment. This investment will be in people, in process, and establishing the AI foundational platforms necessary to make it work.

Speaker #3: On slide 13, adjusted earnings increased across all three segments, with both wealth management and asset management up more than 30%. Slide 14 shows our asset growth, which was not concentrated in just one or two businesses.

Speaker #3: Total AUNA increased by 19% year over year to 622 billion dollars, with all six of our wealth and asset management businesses higher than a year ago.

Speaker #3: This brings me back to the actions we announced in June, on slide 15. We designed these actions to create more meaningful capacity to invest in the future of our businesses without simply layering on more cost and complexity.

Speaker #3: That capacity will support the next phase of our AI investment. This investment will be in people, in process, and establishing the AI foundational platforms necessary to make it work.

Speaker #3: There are two principles guiding this work. Simplification and personalization. Simplification means removing friction points and making it easier for us to work together, for our advisors and clients to work with us, and ensuring that we are working with our clients in the best way that fits their needs.

Damon Murchison: There are two principles guiding this work: simplification and personalization. Simplification means removing friction points and making it easier for us to work together, for our advisors and clients to work with us, and ensuring that we are working with our clients in the best way that fits their needs. Personalization means using better data, technology, and insights to elevate the client experience by enabling advisors to deliver more personalized advice, solutions, and service. AI is a critical enabler of simplification and personalization. At IG, AI at the onset is giving advisors time back to help them deliver a more personalized client experience. One example is how AI is supporting the client meeting flow, surfacing relevant meeting prep insights before meetings, and streamlining follow-up and documentation.

Speaker #3: Personalization means using better data, technology, and insights to elevate the client experience by enabling advisors to deliver more personalized advice, solutions, and service. AI is a critical enabler of simplification and personalization.

Speaker #3: At IG, AI at the onset is giving advisors time back to help them deliver more personalized client experience. One example is how AI is supporting the client meeting flow, servicing relevant meeting prep, insights before meetings, and streamlining follow-up and documentation.

Speaker #3: At McKinsey, AI is already embedded in parts of the investment process, helping teams process complex data and supporting idea generation, research, and client service.

Damon Murchison: At Mackenzie, AI is already embedded in parts of the investment process, helping teams process complex data and supporting idea generation, research, and client service. Across IGM, it can reduce repetitive tasks, eliminate manual work, and give people more time for high-value work that improves both the employee and the advisor experience. Our participation in the Sagard AI Fund complements the work by giving us another source of market intelligence and opportunities to engage with leading AI companies. The objective here is straightforward: better client experience, greater advisor productivity and sales team productivity, improved operating efficiency in support of growth and investment returns. Now with that, let me turn to slide 17 and talk about our wealth management segment's results. IG Wealth delivered another strong record quarter, including record Q2 new client inflows and the eighth consecutive quarter of positive net flows.

Speaker #3: Across IGM, it can reduce repetitive tasks, eliminate manual work, and give people more time for high-value work that improves both the employee and the advisor experience.

Speaker #3: Our participation in the Sagard AI Fund complements the work by giving us another source of market intelligence and opportunities to engage with leading AI companies.

Speaker #3: The objective here is straightforward: better client experience, greater advisor productivity and sales team productivity, and improved operating efficiency in support of growth and investment returns.

Speaker #3: And with that, let me turn to slide 17 and talk about our wealth management segments results. IG Wealth delivered another strong record quarter, including record second quarter, new client inflows, and the eighth consecutive quarter of positive net flows.

Speaker #3: That progress reflects our focus on massive fluid and high net worth Canadians where comprehensive financial planning is most relevant and valuable. IG was also recognized in the quarter by Forbes as being one of Canada's best employers for company culture.

Damon Murchison: That progress reflects our focus on mass affluent and high-net-worth Canadians, where comprehensive financial planning is most relevant and valuable. IG was also recognized in the quarter by Forbes as being one of Canada's best employers for company culture. Turn to slide 18. Gross inflows were CAD 4.5 billion, up 26% from a year ago, and our trailing 12-month net flows rate was 1.5%. Investment performance was also strong, with 97% of our investment solutions rated 3 stars or higher by Morningstar. That performance continues to support client advisor confidence in IGM Managed Solutions, which represented 88% of our assets under advisement. Slide 19 shows that both mass affluent and high-net-worth clients contributed to our new client momentum, reinforcing the strength of our value proposition in the segments we are built to serve. Slide 20 covers mortgages and insurance, two very important parts of our comprehensive financial planning offering.

Speaker #3: Turn to slide 18. Gross inflows were $4.5 billion, up 26% from a year ago, and our trailing 12-month net flows rate was 1.5%.

Speaker #3: Investment performance was also strong. With 97% of our investment solutions rated three stars or higher by Morningstar. That performance continues to support client and advisor confidence in IGM Managed Solutions, which represented 88% of our assets under advisement.

Speaker #3: Slide 19 shows that both massive fluid and high net worth clients contributed to our new client momentum, reinforcing the strength of our value proposition in the segments we are built to serve.

Speaker #3: Slide 20 covers mortgages and insurance, two very important parts of our comprehensive financial planning offering. I'll focus on insurance for a moment, where our new annualized premium has reached $33 million, significantly higher than prior periods.

Damon Murchison: I'll focus on insurance for a moment, where our new annualized premium has reached CAD 33 million, significantly higher than prior periods. This reflects our continued focus on estate planning part of the insurance market, which generally leads to policies with higher face values. Those higher policies are becoming a more meaningful part of the business as we strengthen our insurance capabilities and serve our client segments with more complex needs. While the timing of larger policies can make results uneven from quarter to quarter, our focus on insurance has led not to just larger policies over time, but to higher case count. The direction of the firm is clear. Insurance is becoming more a part of how we serve our clients and grow this business. Turning to slide 21.

Speaker #3: This reflects our continued focus on estate planning part of the insurance market, which generally leads to policies with higher face values. Those higher policies are becoming a more meaningful part of the business as we strengthen our insurance capabilities and serve our client segments with more complex needs.

Speaker #3: While the timing of larger policies can make results uneven from quarter to quarter, our focus on insurance has led not to just larger policies over time, but to higher case count.

Speaker #3: The direction of the firm is clear. Insurance is becoming more a part of how we serve our clients and grow this business. Turn to slide 21.

Speaker #3: These six industry wealth drivers capture the key financial challenges facing our target client segments. And the areas where our advisors can help clients navigate these challenges and add value through financial planning advice.

Damon Murchison: These six industry wealth drivers capture the key financial challenges facing our target client segments and the areas where our advisors can help clients navigate these challenges and add value through financial planning advice. One of those areas is high-net-worth family wealth. During the quarter, we added two new partnerships with Legacy Next and Tamarind Learning to strengthen our capabilities in the family wealth dynamics, education, and governance pillar. Together, these partnerships give our advisors more tools to help families build the confidence, knowledge, and structure needed to manage wealth across generations. Now let's turn to slide 22 and talk about Rockefeller. Rockefeller's client assets increased 31% year over year with market returns, organic growth, and additional new advisor teams all contributing. Its iconic brand and comprehensive high-net-worth platform continue to attract leading advisor teams across the United States. Turn to slide 23 and Wealthsimple.

Speaker #3: One of those areas is high net worth financial wealth. During the quarter, we added two new partnerships with legacy Next and Tamron Learning to strengthen our capabilities in the family wealth dynamics education and governance pillar.

Speaker #3: Together, these partnerships give our advisors more tools to help families build the confidence, knowledge, and structure needed to manage wealth across generations. Now let's turn to slide 22 and talk about Rockefeller.

Speaker #3: Rockefeller's client assets increased 31% year over year, with market returns, organic growth, and additional new advisor teams all contributing. Its iconic brand and comprehensive high-net-worth platform continue to attract leading advisor teams across the United States.

Speaker #3: Turn to slide 23 at Wealthsimple. Wealthsimple's AUA reached $155.6 billion, up 84% year over year, and $30.8 billion during the quarter. Record net flows of approximately $17 billion were the largest contributor.

Damon Murchison: Wealthsimple's AUA reached CAD 155.6 billion, up 84% year over year, and CAD 30.8 billion during the quarter. Record net flows of approximately CAD 17 billion were the largest contributor. Wealthsimple's strong brand, digital-first experience, and pace of innovation continue to drive client and asset growth. With that, I'll turn the call over to Luke to discuss Mackenzie's Q2 results.

Speaker #3: WellSimple's strong brand, digital first experience, and pace of innovation continue to drive client and asset growth. With that, I'll turn the call over to Luke to discuss McKinsey's second quarter results.

Speaker #1: Great, thanks, Damon. Good morning, everyone. Turn to page 25 and you'll see highlights from McKinsey and the asset management segment for the quarter. We are pleased with continued momentum in the quarter across many dimensions.

Luke Gould: Great. Thanks, Damon. Good morning, everyone. If you turn to page 25, you'll see highlights for Mackenzie and the asset management segment for the quarter. We are pleased with continued momentum in the quarter across many dimensions. Our AUM is up 20% in the last year to CAD 269 billion, and during the quarter, we generated investment returns of 10.5% for clients. Our net sales continue to strong with CAD 1.9 billion in Q2 and CAD 3.6 billion year to date. This was our best Q2 investment fund net sales in five years and was driven by momentum in retail, which was up meaningfully from 2025. We also onboarded CAD 2 billion in previously announced institutional wins during the quarter, and we also had multiple CAD billion of awards in Q2, which we'll fund during the coming quarters. At the top of the page, we've reiterated our strategic priorities at Mackenzie.

Speaker #1: Our AUM is up 20% in the last year to $269 billion, and during the quarter we generated investment returns of 10.5% for clients. Our net sales continue to be strong, with $1.9 billion in Q2 and $3.6 billion year to date.

Speaker #1: This was our best second quarter investment fund net sales in five years, and was driven by momentum in retail, which was up meaningfully from 2025.

Luke Gould: This was our best Q2 investment fund net sales in five years and was driven by momentum in retail, which was up meaningfully from 2025. We also onboarded CAD 2 billion in previously announced institutional wins during the quarter, and we also had multiple CAD billion of awards in Q2, which we'll fund during the coming quarters. At the top of the page, we've reiterated our strategic priorities at Mackenzie.

Speaker #1: We also onboarded 2 billion dollars in previously announced institutional wins during the quarter, and we also had multiple billion dollars awards in Q2, which will fund during the coming quarters.

Speaker #1: At the top of the page, we've reiterated our strategic priorities at McKinsey. Raised the bar on investment excellence. Built better product and deliver a great service experience.

Luke Gould: Raise the bar in investment excellence, build better product, and deliver a great service experience. All of our initiatives to advance the business are focused around these three priorities. In the top right, you'll see that during the quarter, around this priority of raising the bar in investment excellence, we made important changes to our investment management organization that I'll review in a few slides. Also, at the bottom of the slide, you can see that China AMC, Northleaf continue to grow, and I'll speak to both of these on coming slides as well. Turning to page 26, you can see the trend in the history of Mackenzie net sales. On the left, you can see solid flows and continued improvement in our investment fund net sales. This is our best Q2 year and year-to-date result in the last 5 years as mentioned.

Speaker #1: And all of our initiatives to advance the business are focused around these three priorities. In the top right, you'll see that during the quarter, around this priority of raising the bar on investment excellence, we made important changes to our investment management organization that I'll review in a few slides.

Speaker #1: Also, at the bottom of the slide, you can see that China MC North Leaf continued to grow, and I'll speak to both of these on the coming slides as well.

Speaker #1: Turn to page 26. You can see the trend and history of McKinsey's net sales. On the left, you can see solid flows and continued improvement in our investment fund net sales.

Speaker #1: This is our second best this is our best second quarter and year to date results in the last five years. As mentioned, and you can see on the right, it was driven by these improvements in retail.

Luke Gould: You can see on the right, it was driven by these improvements in retail. At the very bottom left, you can see the strong year-to-date overall net sales, which were at the same level as 2025, which was a record high net sales year for us, and this is driven by continuing inflows from institutional investors. We're expecting continued improvement over the coming quarters as we continue to have winning conditions in a number of places within our offerings. On page 27, I'd highlight first in the bottom left that the industry environment remains healthy and the mutual fund net sales rate for the industry peers is around 2%, and we're slightly above this. In the top right, we've highlighted the continued growth in retail with CAD 360 million in improvement year-over-year, as well as CAD 1.8 billion in improvement in institutional separate account net sales.

Speaker #1: And at the very bottom left, you can see the strong year to date overall net sales, which were at the same level as 2025, which was our record high net sales year for us.

Speaker #1: This is driven by continuing inflows from institutional investors. We expect continued improvement over the coming quarters, as we continue to have winning conditions in a number of areas within our offerings.

Speaker #1: On page 27, I'd highlight first in the bottom left that the industry environment remains healthy, and the mutual fund net sales rate for the industry peers is around 2%, and we're slightly above this.

Speaker #1: In the top right, we've highlighted the continued growth in retail, with 360 million in improvement year over year, as well as the 1.8 billion in improvement in institutional separate account net sales.

Speaker #1: Our $1.5 billion in institutional SMA net sales in the quarter included the $2 billion in onboardings referenced earlier, partially offset by some net redemptions from other clients.

Luke Gould: Our CAD 1.5 billion in institutional SMA net sales in the quarter included the CAD 2 billion onboardings referenced earlier, partially offset by some net redemptions from other clients. These onboardings continue to reflect a good mix of some of the largest public pensions globally, as well as some advisory to financial institutions. In the bottom right, overall investment performance continues to be solid, and our share of assets residing in 5-star funds remains at its highest level in 4 years, and we have compelling performance across a range of relevant strategies. Moving to page 28, I have 2 updates related to our strategic priority of raising the bar in investment excellence. First, on the left is a reminder of Mackenzie's boutique approach. We have autonomous teams with their own demonstrable investment edge who leverage a common support platform.

Speaker #1: These onboardings continue to reflect a good mix of some of the largest public pensions globally, as well as some advisory to financial institutions. And in the bottom right, overall investment performance continues to be solid, and our share of assets residing in five-star funds remains at its highest level in four years, and we've compelling performance across a range of relevant strategies.

Speaker #1: Move to page 28. I have two updates related to our strategic priority of raising the bar on investment excellence. First, on the left, is a reminder of McKinsey's boutique approach.

Speaker #1: We have autonomous teams with their own demonstrable investment edge who leverage a common support platform. This approach provides diversity and breadth in our capabilities with no groupthink, while ensuring that our teams have the resources and support that they need to generate alpha and harness the respective investment edges.

Luke Gould: This approach provides diversity and breadth in our capabilities with no groupthink, while ensuring that our teams have the resources and support that they need to generate alpha and harness their respective investment edges. In the middle, you can see that in the quarter, we made a number of changes to bolster investment excellence, enhance talent management, and drive technology enablement. We've reduced our number of teams from 15 to nine through a combination of rationalization and coordination of kindred spirits franchises. Part of this was the rationalization of 3 boutiques and a reassign of their mandates to our global quantitative equity team and our multi-asset strategies team. You can see this on the right, numbers 3 and 4. As well, we brought together a number of teams through coordination of talent and shared resources, and you can see this on the right, numbers 1 and 2.

Speaker #1: In the middle, you can see that in the quarter we made a number of changes to bolster investment excellence, enhance talent management, and drive technology enablement.

Speaker #1: We've reduced our number of teams from 15 to 9 through a combination of rationalization and coordination of kindred spirits franchises. Part of this was a rationalization of three boutiques, and a reassignment of their mandates to our global quantitative equity team and our multi-asset strategies team, and you can see this on the right, numbered three and four, as well we brought together a number of teams through coordination of talent and shared resources, and you can see this on the right, numbered one and two.

Speaker #1: These changes are designed to ensure that all of our capabilities have a clear edge and stand proudly on a world stage, with a clear path to commercial relevance across client segments.

Luke Gould: These changes are designed to ensure that all of our capabilities have a clear edge and stand proudly on a world stage with a clear path to commercial relevance across client segments. The changes are also designed to bolster the scale, talent management, and resources of each team, and to foster AI and technology enablement. Also in the bottom left, you can see that we completed a multi-year initiative during July with the completion of our middle office and data foundation with our partner, BNY Mellon. This middle office platform provides a world-class operating environment for our investment teams to do their best work and also provides a strong foundation for tech and AI enablement. Turning to page 29, you can see the performance and net sales for our retail investment fund by boutique. I'd highlight a few things on this slide.

Speaker #1: The changes are also designed to bolster the scale, talent management, and resources of each team, and to foster AI and technology enablement. Also in the bottom left, you can see that we completed a multi-year initiative during July, with the completion of our middle office and data foundation, with our partner BNY Mellon.

Speaker #1: This middle office platform provides a world-class operating environment for our investment teams to do their best work, and also provides a strong foundation for tech and AI enablement.

Speaker #1: Straight to page 29, you can see the performance and net sales for our retail investment fund by boutique. I'd highlight a few things on this slide.

Speaker #1: First, in the third column from the left, we continued to see noteworthy retail flows into our Global Quant Equity boutique. I’d note that we do not view these flows as being merely potential.

Luke Gould: First, in the third column from the left, we continue to see noteworthy retail flows into our global quant equity boutique. I'd note that we do not view these flows as being near their potential. We have over 15 retail mandates here in large categories, and the track records are exceptional. This holistic quant all-weather approach that marries AI and HI is compelling in terms of both the level of alpha and the consistency of alpha across different market environments. I'd also note in the middle, we reassigned responsibility for our growth mid team to the quant team during the quarter, expanding our quant retail lineup further. As you scan across the top section of the slide, you'll see we have very compelling performance in a number of relevant product categories at the moment where we're leaning in.

Speaker #1: We have over 15 retail mandates here in large categories, and the track records are exceptional. This holistic, quant, all-weather approach that marries AI and HI is compelling in terms of both the level of alpha and the consistency of alpha across different market environments.

Speaker #1: I'd also note in the middle, we reassigned responsibility for our gross mid team, to the quant team during the quarter, expanding our quant retail lineup further.

Speaker #1: And as you scan across the top section of the slide, you'll see we have very compelling performance in a number of relevant product categories at the moment where we're leaning in.

Speaker #1: This includes our multi-asset strategies team, our value team, and our resources and energy evolution greenship team, among others. Straight to page 30, a few comments on the Chinese investment fund industry.

Luke Gould: This includes our multi-asset strategy team, our value team, and our resources and energy evolution Greenchip team, among others. Turning to page three, a few comments on the Chinese investment fund industry. Industry long-term assets were up 10% in the quarter, driven by strong Chinese equity market returns in the quarter. Industry long-term fund net sales were very slightly paused in the quarter. As discussed last quarter, as part of robust equity market improvements, the industry had net outflows of passive ETFs of around CNY 800 billion in the quarter, reflecting activities by the national team. This was offset by net inflows into fixed income products. On the right, I'd highlight China AMC maintained its rank of number two in the industry with a 5.2% market share. On slide 31, China AMC ended the quarter with total AUM of CNY 2.9 trillion, up 3% in the quarter.

Speaker #1: Industry long-term assets were up 10% in the quarter, driven by strong Chinese equity market returns in the quarter. Industry long-term fund net sales were very slightly positive in the quarter.

Speaker #1: And as discussed last quarter, as part of robust equity market improvements, the industry had net outflows of passive ETFs of around 800 billion won in the quarter, reflecting activities by the national team.

Speaker #1: This was offset by net inflows into fixed income products. And on the right, I'd highlight China MC maintained its rank of number two in the industry, with a 5.2% market share.

Speaker #1: On slide 31, China MC ended the quarter with total AUM of 2.9 trillion won, up 3% in the quarter. At the bottom, you'll see China MC had 145 billion won and net outflows during the quarter, which, like Q1, reflected participation in these industry passive ETF net outflows for the industry.

Luke Gould: At the bottom, you'll see China AMC had CNY 145 billion in net outflows during the quarter, which like Q1, reflected participation in these industry passive ETF net outflows for the industry. I would remind that China AMC is industry leader in the ETF space. Turning to slide 32. Northleaf continued to deliver strong asset growth, supported by CAD 4.3 billion of new commitments over the last year, this included just under CAD 1 billion in Q2. I do want to make a few special remarks on Northleaf as we've reached an important milestone this quarter as we near the six-year anniversary of our partnership. First, I do want to highlight how very proud we are of Northleaf's development and success over the last five years.

Speaker #1: And I would remind that China MC is an industry leader in the ETF space. Straight to slide 32. Northleaf continued to deliver strong asset growth, supported by $4.3 billion of new commitments over the last year, and this included just under $1 billion in the second quarter.

Speaker #1: I do want to make a few special remarks on Northleaf, as we've reached an important milestone this quarter as we near the six-year anniversary of our partnership.

Speaker #1: First, I do want to highlight how very proud we are of Northleaf's development and success over the last five years. As you can see here, the business has grown at a compound annual rate of approximately 20% over this period, and is now two and a half times the size that it was in 2020, with global investment reach across private equity, private credit, and infrastructure asset classes.

Luke Gould: As you can see here, the business has grown at a compound annual rate of approximately 20% over this period, and is now two and a half times the size that it was in 2020, with global investment reach across private equity, private credit, and infrastructure asset classes. Importantly, it has also expanded its clientele internationally over this time, reaching a milestone of having the majority of its commitments coming from outside Canada in 2024. The partnership is also helping fuel opportunities across IGM and the broader Power Group ecosystem. We view private markets as a very important asset class across so many of our business lines. July of this year marks another important milestone in the partnership. As contemplated in 2020 and communicated publicly at that time, the original arrangements include the rights and obligations relating to additional equity and voting interests after five years.

Speaker #1: Importantly, it has also expanded its clientele internationally over this time, reaching a milestone of having the majority of its commitments coming from outside Canada, in 2024.

Speaker #1: The partnership has also helped fuel opportunities across IGM and the broader Power Group ecosystem, and we view private markets as a very important asset class across so many of our business lines.

Speaker #1: July of this year marks another important milestone in the partnership. As contemplated in 2020, and communicated publicly at that time, the original arrangements include the rights and obligations relating to additional equity and voting interests after five years.

Speaker #1: We could not be more pleased with the series of transactions that we completed in early July, which restructured the original arrangements with two very important outcomes.

Luke Gould: We could not be more pleased with the series of transactions that we completed in early July, which restructured the original arrangements with two very important outcomes. First, the Northleaf management team will continue to have this consistent, meaningful equity participation in the business over the long term, preserving the strong alignment that has been so important to the success of the partnership. Second, Stuart Vaughan and his leadership team will continue managing Northleaf, focused on serving its investors and continue to build the business over the long term. I'll now turn the call over to Keith Potter. Keith will cover the financial results. He will also cover the accounting implications as we start consolidating Northleaf as a consequence of these transactions.

Speaker #1: First, the Northleaf management team will continue to have consistent, meaningful equity participation in the business over the long term, preserving the strong alignment that has been so important to the success of the partnership.

Speaker #1: Second, Stuart Wan is leadership team will continue managing Northleaf, focused on serving its investors and continue to build the business over the long term.

Speaker #1: And I'll now turn the call over to Keith Potter, and Keith will cover the financial results, and he will also cover the accounting implications as we start consolidating Northleaf as a consequence of these transactions.

Speaker #2: Thank you, Luke, and good morning, everyone. Turning to slide 34, the second quarter delivered strong, broad-based results, with adjusted EPS of $1.41, up 32% year over year.

Keith Potter: Thank you, Luke, and good morning, everyone. Turning to slide 34, the Q2 delivered strong, broad-based results with adjusted EPS of CAD 1.41, up 32% year over year. Reported EPS was CAD 1.12. The main adjusting items were the previously announced restructuring charge and the typical adjustment for Great-West Life earnings. Adjustments also include a gain on partial sale of an investment in associate, and a mark-to-market impact of the new Rockefeller management equity program. A few comments on the restructuring charge and our reinvestment priorities. As Damon commented, AI is a foundational technology for the future that will require meaningful investment. We challenged the leadership team to identify structural savings to create capacity for this investment without making it additive to our existing priorities.

Speaker #2: Reported EPS was $1.12. The main adjusting items were the previously announced restructuring charge and the typical adjustment for Great-West Life earnings. Adjustments also include a gain on partial sale of an investment in an associate, and a mark-to-market impact of the new Rockefeller management equity program.

Speaker #2: A few comments on the restructuring charge, and our reinvestment priorities. As Damon commented, AI is a foundational technology for the future that will require meaningful investment.

Speaker #2: We challenged the leadership team to identify structural savings to create capacity for this investment, though making it additive to our existing priorities. These savings will be reinvested in people, process, and technology to build comprehensive enterprise AI foundational capabilities, and deploy AI responsibly and at-scale solutions to make the business stronger and more efficient.

Keith Potter: These savings will be reinvested in people, process, and technology to build comprehensive enterprise AI foundational capabilities and deploy AI responsibly and at scale solutions to make the business stronger and more efficient. The Rockefeller adjusting item related to a new management equity program that aligns management over the long term, which I commented on at a high level during the Q4 call. Under IFRS, the equity program will be expensed based on cash-settled accounting and remeasured quarterly based on their fair value. The impact is CAD 900,000 this quarter. Because RCM is growing rapidly, we believe future expense will be quite volatile. Therefore, are excluding it from adjusted results to improve comparability period-over-period and better reflect performance of the underlying business. This differs from IGM's other option programs where expenses follow equity-settled accounting and are generally expensed on a straight-line basis.

Speaker #2: The Rockefeller adjusting item related to a new management equity program that aligns management over the long term which I commented on at a high level, during the Q4 call.

Speaker #2: Under IFRS, the equity program will be expensed based on cash settled accounting, and remeasured quarterly based on their fair value. The impact is $900,000 this quarter.

Speaker #2: Because RCM is growing rapidly, we believe future expenses will be quite volatile. Therefore, we are excluding it from adjusted results to improve comparability period over period and better reflect the performance of the underlying business.

Speaker #2: And this differs from IGM's other option programs, where expenses follow equity settled accounting and are generally expensed on a straight-line basis. Turning to capital allocation, we returned 345 million dollars to shareholders in the quarter, including 200 million dollars in share repurchases.

Keith Potter: Turning to capital allocation, we returned CAD 345 million to shareholders in the quarter, including CAD 200 million in share repurchases. We also ended the quarter with unallocated capital of CAD 935 million and reduced our gross debt-to-EBITDA ratio to 1.25x, which leaves us with substantial financial flexibility as we continue to return capital to shareholders. Finally, Luke commented on the long-term partnership with Northleaf that we are thrilled with. As discussed, we've restructured the 2020 arrangement to preserve management equity participation while providing the flexibility to recycle ownership over time as part of succession planning. You will see in the financial statements we have subsequent event disclosures related to the transactions that closed in July. If you have any questions on the accounting or other points of clarification, please reach out to the Investor Relations team, including Kyle. There are three things, though, I think you need to know.

Speaker #2: We also ended the quarter with unallocated capital, of 935 million, and reduced our gross debt to EBITDA ratio to 1.25 times, which leaves us with substantial financial flexibility, as we continue to return capital to shareholders.

Speaker #2: Finally, Luke commented on the long-term partnership with Northleaf that we are thrilled with. And as discussed, we've restructured the 2020 arrangement to preserve management equity participation, while providing the flexibility to recycle ownership over time as part of succession planning.

Speaker #2: You will see in the financial statements we have subsequent event disclosures related to the transactions that closed in July. If any questions on the accounting or other points of clarification, please reach out to the investor relations team, including Kyle.

Speaker #2: There are three things that I think you need to know. First, effective July 1st, we will consolidate 100% of Northleaf's revenues, expenses, assets, and liabilities on a line-by-line basis, within the asset management segment.

Keith Potter: First, effective 1 July, we will consolidate 100% of Northleaf's revenues, expenses, assets, and liabilities on a line-by-line basis within the Asset Management segment, with the portion owned by Northleaf Management and Great-West presented as non-controlling interests. As a reference point, we expect our reporting for Northleaf to be similar to how we presented IPC back in 2022, so you can use that as a reference point. Importantly, this is a change in accounting presentation rather than underlying economics or how the business will be managed going forward. Second, as a result of the transaction, Mackenzie's economic interest increased slightly from 56% to 60.9%. Lastly, based on current estimates, we do expect to record a non-cash gain of CAD 187 million or CAD 149 million after non-controlling interest in Q3. This gain stems from moving from equity accounting to Northleaf's consolidation accounting.

Speaker #2: But the portion owned by Northleaf management and Great West presented as non-controlling interests. And as a reference point, we expect our reporting for Northleaf to be similar to how we presented IPC back in 2022, so you can use that as a reference point.

Speaker #2: Importantly, this is a change in accounting presentation rather than underlying economics or how the business will be managed going forward. Second, as a result of the transaction, McKinsey's economic interest increased slightly from 56% to 60.9%.

Speaker #2: And lastly, based on current estimates, we do expect to record a non-cash gain of $187 million, or $149 million after non-controlling interest, in the third quarter. This gain stems from moving from equity accounting to Northleaf's consolidation accounting.

Speaker #2: I'll hit on remaining highlights from the quarter on upcoming slides, including Wealthsimple and capital management transactions. Turning to slide 35, you can see our AUMNA and flow trend.

Keith Potter: I'll hit on remaining highlights from the quarter on upcoming slides, including Wealthsimple and Capital Management transactions. Turning to slide 35, you can see our AUM&A and flow trend. Average AUM&A increased 4.3% relative to Q1. Period-ending assets are up 9.4%, which sets us up well for Q3. On slide 36, higher assets at IGM drove revenue growth of 18.6% year-over-year and adjusted EPS up 31.8%. Results were well diversified across wealth management and asset management and across our core businesses, as well as strategic investments. Turning to operations and support business development expenses, we are maintaining expense growth guidance of 4%. Slide 37 presents key profitability drivers for IG Wealth Management. On the left, you can see average AUM&A was up 3.9% from last quarter. On the right, our advisory fee rate decreased 0.6 basis points in line with guidance provided last quarter.

Speaker #2: Average AUMNA increased 4.3% relative to Q1, but period-ending assets are up 9.4%, which sets us up well for the third quarter. On slide 36, higher assets at IGM drove revenue growth of 18.6% year over year, and adjusted EPS is up 31.8%.

Speaker #2: Results were well diversified across wealth management and asset management, and across our core businesses as well as strategic investments. Turning to operations and support business development expenses, we are maintaining expense growth guidance of 4%.

Speaker #2: Slide 37 presents key profitability drivers for IG Wealth Management. On the left, you can see average AUMNA was up 3.9% from last quarter. On the right, our advisory fee rate decreased 0.6 basis points, in line with guidance provided last quarter. As a reminder, the decrease in fee rate was driven by advisors working with clients during the quarter to reinvest cash into long-term investment solutions.

Keith Potter: As a reminder, the decrease in fee rate was driven by advisors working with clients during the quarter to reinvest cash into long-term investment solutions. As a reminder, cash spreads are higher than the standard advisory fee rate. We expect this to continue in Q3 at a more moderate rate and expect fee rates to come down a quarter to half a basis point. The asset-based compensation rate was up slightly in the quarter and expect a modest increase in Q3. On slide 38, IG's overall earnings of CAD 174.7 million is a record quarter and up 32.9% year-over-year on revenue growth of 19%, demonstrating strong growth and positive operating leverage in the business for consecutive quarters. On point two, other financial planning revenue continues to demonstrate growth year-over-year, supported by strength in the mortgage and insurance businesses.

Speaker #2: And as a reminder, cash spreads are higher than the standard advisory fee rate. We expect this to continue in Q3 at a more moderate rate, and expect fee rates to come down a quarter to half a basis point.

Speaker #2: The asset-based compensation rate was up slightly in the quarter and expect a modest increase in Q3. On slide 38, IG's overall earnings of $174.7 million is a record quarter and up 32.9% year over year on revenue growth of 19%, demonstrating strong growth and positive operating leverage in the business for consecutive quarters.

Speaker #2: On point 2, other financial planning revenue continues to demonstrate growth year over year, supported by strength in the mortgage and insurance businesses. Other product commissions is up in line with the growth of insurance sales.

Keith Potter: Other product commissions is up in line with the growth of insurance sales. As we look forward to Q3, we do expect growth to continue in insurance relative to last year, but perhaps not at the same pace we saw in Q2. With respect to expenses, as I mentioned on the last call, Q2 is a seasonally high quarter and expect expenses to come down in Q3 with a seasonal pattern that looks similar to 2024. Moving to Mackenzie on Slide 39, average AUM was up 4.4% versus Q1, and on the right, the third-party rate, excluding Canada Life, decreased 3.9 basis points, which is in line with guidance. As a reminder, we had three main items impacting the rate this quarter. First, the success of our strategic partners in institutional onboarding. Second, the impact of previously announced fee changes that became effective 1 April.

Speaker #2: And as we look forward to Q3, we do expect growth to continue in insurance relative to last year, but perhaps not at the same pace we saw in Q2.

Speaker #2: With respect to expenses, as I mentioned on the last call, Q2 is a seasonally high quarter, and we expect expenses to come down in Q3.

Speaker #2: It's a seasonal pattern that looks similar to 2024. Moving to McKinsey on slide 39, average AUM was up 4.4% versus Q1. And on the right, the third-party rate excluding Canada Life decreased 3.9 basis points, which is in line with guidance.

Speaker #2: As a reminder, we had three main items impacting the rate this quarter. First, the success of our strategic partners and institutional onboarding. Second, the impact of previously announced fee changes that became effective April 1st.

Speaker #2: And third, the non-recurring performance fees earned in Q1 that did not repeat in Q2. As we look to the next quarter, we expect the third-party fee rate excluding Canada Life to decrease approximately 1.5 basis points, and the overall third-party rate to decline approximately 0.7 basis points, primarily due to the continued success of these strategic partnerships and the institutional onboarding.

Keith Potter: Third, the non-recurring performance fees earned in Q1 that did not repeat in Q2. As we look to the next quarter, we expect the third-party fee rate, excluding Canada Life, to decrease approximately 1.5 basis points, and the overall third-party rate to decline approximately 0.7 basis points, primarily due to the continued success of these strategic partnerships and the institutional onboarding. This includes a full quarter of what was onboarded in Q2, as well as new wins we expect to onboard in Q3, which Luke spoke to. Turning to Slide 40, Mackenzie's earnings of CAD 75.3 million are up 30% year over year, and Q2 illustrates the operating leverage in the business with the revenue up 14% and earnings up 30. Operations support and business development expenses growth came in at 3.4%, in line with expectations. Turning to China AMC on Slide 41.

Speaker #2: And this includes a full quarter of what was onboarding and unboarding in Q2, as well as new wins we expect to onboard in Q3, which Luke spoke to.

Speaker #2: Turning to slide 40, McKinsey's earnings of $75.3 million are up 30% year over year, and Q2 illustrates the operating leverage in the business with the revenue up 14% and earnings up 30.

Speaker #2: Operations and support and business development expenses growth came in at 3.4% in line with expectations. Turning to China EMC on slide 41, Luke already commented on AUM.

Keith Potter: Luke already commented on AUM, and earnings were CAD 43.9 million in Q2, up significantly from Q1 and last year. With strong Q2 performance of the Chinese equity markets, the company did benefit from seed capital fair value gains. Excluding the impact of these gains, earnings would've been in line with Q1 results. Slide 42 has earnings contributions from each company. First, Rockefeller earnings are in line with expectations. Northleaf had earnings of CAD 6.2 million net of non-controlling interest for the quarter. As part of the Northleaf July transactions, we did receive a CAD 45 million dividend comprising a customary annual dividend and a special dividend representing distribution of excess cash. On Slide 43, we continue to make progress against our capital allocation priorities.

Speaker #2: Earnings were $43.9 million in Q2, up significantly from Q1 and last year. With strong Q2 performance in the Chinese equity markets, the company did benefit from Seed Capital fair value gains. Excluding the impact of these gains, earnings would have been in line with Q1 results.

Speaker #2: Slide 42 has earnings contributions from each company. First, Rockefeller earnings are in line with expectations. Northleaf had earnings of $6.2 million, net of non-controlling interest for the quarter.

Speaker #2: And as part of the Northleaf July transactions, we did receive a $45 million dividend, comprising a customary annual dividend and a special dividend representing the distribution of excess cash.

Speaker #2: On slide 43, we continue to make progress against our capital allocation priorities. We returned $345 million in capital to shareholders in Q2, which is an all-time high.

Keith Potter: We returned CAD 345 million in capital to shareholders in Q2, which is an all-time high. At the same time, we've maintained CAD 935 million in unallocated capital, and our gross leverage ratio for the quarter is lower at 1.25x. We also saw the cash dividend payout ratio drop to 53%, excluding the special dividend from Northleaf. Finally, in June, we issued CAD 400 million in debentures and subsequently redeemed debentures maturing in January 2027. Because the redemption settled on 2 July, both the new debt and cash from the issuance are recorded on the balance sheet for Q2. We presented our unallocated capital and leverage ratios on the slide net of the redemptions that settle on 2 July, which is the comparable baseline for Q3. Turning to 44, IGM's indicative value is approximately CAD 94 per share.

Speaker #2: And at the same time, we've maintained $935 million in unallocated capital, and our gross leverage ratio for the quarter is lower at 1.25 times.

Speaker #2: We also saw the cash dividend payout ratio drop to 53%, excluding the special dividend from Northleaf. And finally, in June, we issued $400 million in debentures and subsequently redeemed debentures maturing in January 2027.

Speaker #2: Because the redemption settled on July 2nd, both the new debt and cash from the issuance are recorded on the balance sheet for Q2. We presented our unallocated capital and leverage ratios on the slide net of the redemptions that settle on July 2nd, which is the comparable baseline for Q3.

Speaker #2: Turning to 44, IGM's indicative value. It's approximately $94 per share. And as a reminder, we derived the indicative value of our core operating companies using average P/E multiples from a diversified group of wealth managers for IG and asset managers for McKinsey, as of market close on July 24th.

Keith Potter: As a reminder, we derive the indicative value of our core operating companies

Damon Murchison: Using average P/E multiples from a diversified group of wealth managers for IG and asset managers for Mackenzie as of market close on 24 July. In the quarter, we increased the fair value of Wealthsimple from CAD 2.26 billion to CAD 2.59 billion. The company performed exceptionally well, as you've heard, with record net flows of CAD 17 billion in Q2 and AUM growth of over CAD 30 billion. The fair value considers Wealthsimple's business performance, driving upward revisions to revenue expectations, and we also consider public peer valuations, as well as the third-party transactions that closed at the end of last year. The value of Northleaf has been adjusted to reflect the transactions that took place in July at fair market value. That will end our prepared remarks, and we'll open the call for questions.

Speaker #2: In the quarter, we increased the fair value of Wealthsimple, from 2.26 billion to 2.59 billion, the company performed exceptionally well as you've heard with record net flows of $17 billion in Q2, and AUM growth of over $30 billion.

Speaker #2: The fair value considers Wealthsimple's business performance driving upward revisions to revenue expectations and we also consider public peer valuations as well as the third-party transactions that closed in the at the end of last year.

Speaker #2: The value of Northleaf has been adjusted to reflect the transactions that took place in July at fair market value. That will end our prepared remarks, and we'll open the call for questions.

Speaker #1: Thank you. We will now begin the question and answer session. To join the question queue, you may press star then 1 on your telephone keypad.

Operator 2: Thank you. We'll now begin the question and answer session. To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two. We'll pause momentarily as callers join the queue. Thank you for your patience. Our first question comes from John Aiken from Jefferies. Please go ahead.

Operator: Thank you. We'll now begin the question and answer session. To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two. We'll pause momentarily as callers join the queue. Thank you for your patience. Our first question comes from John Aiken from Jefferies. Please go ahead.

Speaker #1: You'll hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then 2.

Speaker #1: We'll pause momentarily as callers join the queue. Thank you for your patience. And our first question comes from John Aiken, from Jefferies. Please go ahead.

Speaker #3: Good morning. Damon, a couple of questions on the AI strategy. I was wondering the Sagard AI fund, you said that has benefits. Is this just being able to take a look at what the company's are doing that Sagard is investing in that you get access to as an investor?

John Aiken: Good morning. Damon, a couple questions on the AI strategy. Was wondering, the Sagard AI Fund, you said that has benefits. Is this just being able to take a look at what the companies are doing that Sagard is investing in, that you get access to as an investor? Is that the theory behind that?

Speaker #3: Is that the theory behind that?

Speaker #4: Yeah, John, that's one of the benefits—to get access to companies that are excelling in the AI field and their leadership, and to learn from them.

Damon Murchison: Yeah, John, that's one of the benefits, is to get access to companies that are excelling in the AI field and their leadership and learn from them. It's much broader than that when you think of it. It's much like Portage on the fintech side and you take a look at example, IG and the number of commercial partnerships we have with fintech companies, a majority of them stem from Portage. There's an opportunity for both Mackenzie and IG to work with Sagard AI Fund and talk about our strategy and where we want to go and for them to align the companies that they're invested in with where we want to be so that we can ultimately drive both top lines.

Speaker #4: But it's much broader than that. When you think of it, it's much like Portage on the fintech side and you take a look at, example, IG and the number of commercial partnerships we have with fintech companies.

Speaker #4: A majority of them stem from Portage. So there's an opportunity for both McKinsey and IG to work with Sagard AI fund and talk about our strategy and where we want to go.

Speaker #4: And for them to align and organize the companies that they're invested in with where we want to be, so that we can ultimately drive both top lines.

Speaker #3: Thank you. And then you mentioned broader I guess integration in with the power grip of companies. Can you let me know in terms of is this just scaling cost-effectiveness or is there actually learning that you can get from the various companies to import into IGM?

John Aiken: Thank you. You mentioned broader integration in with the Power Corp of companies. Can you let me know in terms of, is this just scalings cost effectiveness or is there actually learning that you can get from the various companies to import into IGM?

Speaker #4: So I just want to confirm your question. So, broader relationship with Power Group of Companies?

Damon Murchison: I just want to confirm your question. Broader relationship with Power Corp group of companies?

Speaker #3: With the AI strategy, yes.

John Aiken: With the AI strategy, yes.

Speaker #4: Oh, gotcha. Okay. Yes. Yeah. So yeah, 100%. So one of the benefits of being in the power ecosystem is that you get to learn from a number of different leadership teams and a number of different organizations.

Damon Murchison: Oh, got you. Okay. Yes. Yeah, 100%. One of the benefits of being in the Power ecosystem is that you get to learn from a number of different leadership teams, a number of different organizations. Whether it's Portage on the fintech side or Diagram on the fintech side, they are two different type of fintech companies under Sagard. Their private asset management arm under Sagard or now under the Sagard AI Fund. We get to benefit from that, both Luke and IG and IGM to work with these companies. The connectivity is thought leadership, it's learning from their leadership teams and how they're thinking about things not just today, but about the future, so that as we envision our future, we can ensure that there's some a little bit of alignment. Then talking about how we can fill our gaps.

Speaker #4: So whether it's Portage on the fintech side or Diagram on the fintech side, there are two different type of fintech companies under Sagard. They're private asset management arm under Sagard or now under the Sagard AI fund.

Speaker #4: We get to benefit from that, both Luke and IG—and IGM—to work with these companies. It's the connectivity, it's thought leadership. It's learning from their leadership teams and how they're thinking about things, not just today, but about the future.

Speaker #4: So that we as we envision our future, we can ensure that there's some a little bit of alignment. And then talking about how we can fill our gaps.

Speaker #4: Ultimately, we come to them with business problems, and they would come back with a fintech or AI solution to help fit that gap.

Damon Murchison: Ultimately, we come to them with business problems, and they would come back with a fintech or AI solution to help fit that gap.

Speaker #3: Fantastic. Thanks, Damon. I'll read you.

John Aiken: Fantastic. Thanks, Damon. I'll recue.

Speaker #1: Our next question comes from Scott Fletcher from CIBC. Please go ahead.

Operator 2: Our next question comes from Scott Fletcher from CIBC. Please go ahead.

Operator: Our next question comes from Scott Fletcher from CIBC. Please go ahead.

Speaker #5: Hi, good morning.

Scott Fletcher [Director of Research: Hi. Good morning. I wanted to ask a question on the institutional awards and the pipeline for what that could look like going forward. I think you've obviously had some great success attracting those assets, curious whether there's more to come there or if this was sort of a good opportunity at the point in time.

Scott Fletcher: Hi. Good morning. I wanted to ask a question on the institutional awards and the pipeline for what that could look like going forward. I think you've obviously had some great success attracting those assets, curious whether there's more to come there or if this was sort of a good opportunity at the point in time.

Speaker #3: I wanted to ask a question on the institutional awards and the pipeline for what that could look like going forward. I think you've obviously had some great success attracting those assets.

Speaker #3: But curious whether there's more to come there or if this is sort of a good opportunity at this point in time.

Speaker #4: Yeah, no, thanks, Scott. This is building momentum. We've had some awards over the past quarter's funding, Q1 and Q2. And now the awards at Q2, we're roughly $5 billion most of it's going to fund during Q4 and Q1.

Damon Murchison: Yeah, no, thanks, Scott. This is building momentum. We've had some awards of the past quarters funding Q1 and Q2, now the awards at Q2 were roughly CAD 5 billion. Most of it's going to fund during Q4 and Q1. The fees are respectable. If you look at slide 39, somewhere between the high number on that page, which is the overall through price fee rate and the low with IG and Canada Life based on their scale. Yeah, the Q2 awards really reflect a lot of what's in the pipe ahead of us that we're working on. The Q2 awards were a function of many clients. A lot of large sovereign wealth funds, public pensions, traditional institutional, some financial institutions. Many clients, many mandates. It reflected awards to four of our teams.

Speaker #4: The fees are respectable. If you look at slide 39, they're somewhere between the high number on that page—which is the overall through-price fee rate—and the low with IG and Candlelight, based on their scale.

Speaker #4: And yeah, the Q2 awards really reflect a lot of what's in the pipeline of us that we're working on. The Q2 awards were a function of many clients.

Speaker #4: A lot of large sovereign wealth funds, public pensions, traditional institutional some financial institutions. So many clients, many mandates. It reflected awards to four of our teams.

Damon Murchison: The largest part of that is obviously quant right now, where we do have a very compelling story. Heading into the back half of the year, the pipeline is feeling very good. We've certainly got enough to fuel us into 2026 and into 2027.

Speaker #4: The largest part of that is obviously Quant right now where we do have a very compelling story. And yeah, so heading into the back half of the year, the pipeline is feeling very good.

Speaker #4: And yeah, we've certainly got enough to fuel us into 2026 and into 2027.

Speaker #1: Okay. That's really helpful color.

Scott Fletcher [Director of Research: Okay. That's really helpful color. Thanks. Staying with the asset management side, on the changes you made at Mackenzie, just wondering if there's potential for additional operating leverage looking forward in that segment, or if this is a case similar to the June announcement where any savings you'd generate there would be reinvested in the sort of AI or other efficiency.

Scott Fletcher: Okay. That's really helpful color. Thanks. Staying with the asset management side, on the changes you made at Mackenzie, just wondering if there's potential for additional operating leverage looking forward in that segment, or if this is a case similar to the June announcement where any savings you'd generate there would be reinvested in the sort of AI or other efficiency.

Speaker #3: Thanks. And then staying with the asset management side, on the changes you made at McKinsey, just wondering if there's potential for additional operating leverage looking forward in that segment or if this is a case similar to the June announcement where.

Speaker #3: Savings you'd have, any savings you'd generate there would be reinvested in this sort of AI or other efficiency tools?

Luke Gould: Tools.

Speaker #4: Thanks, Scott. So, yeah, on page 28 of the change we made—so those changes were made in May. So those are Q2 changes. This is—we have declared a large part of them is really reinvesting in talent and technology to improve our platform over time.

Luke Gould: Yeah, on page 28 on the changes we made. Those changes were made in May, those are Q2 changes. We have declared a large part of them is really reinvesting in talent and technology to improve our platform over time and our competitiveness. On operating leverage, that's one of the features of Mackenzie's P&L. We've got a lot of operating leverage here. You could see that in our Q2 earnings growth of 30% year over year. Yes, as the business scales, there's a lot of leverage in it.

Speaker #4: And our competitiveness. And on offering leverage, that's one of the features of McKinsey's P&L. We've got a lot of offering leverage here. You could see that in our Q2 earnings growth of 30% year over year.

Speaker #4: And so yeah, as the business scales, there's a lot of leverage in it.

Speaker #3: Okay. Thanks. I'll pass along.

Scott Fletcher [Director of Research: Okay, thanks. I'll pass the line.

Scott Fletcher: Okay, thanks. I'll pass the line.

Speaker #1: The next question comes from Tom McKinnon from BMO Capital Markets. Please go ahead.

Operator 2: The next question comes from Tom MacKinnon from BMO Capital Markets. Please go ahead.

Operator: The next question comes from Tom MacKinnon from BMO Capital Markets. Please go ahead.

Speaker #2: Yeah, thanks very much. Good morning here. Just a question with respect to China. AMC. The industry shows 14% growth in last year, in terms of assets, yet China AMC is just up 2%.

Tom MacKinnon: Yeah, thanks very much. Good morning here. Just a question with respect to China AMC. The industry shows 14% growth in last year in terms of assets, yet China AMC is just up 2%. I think you had mentioned strong performance, it's just what's driving all the money coming out of China AMC versus what may not be the same kind of net flow issue with respect to the investment fund industry. Then if you can help me understand the seed gains you got out of China AMC, just given the fact that there hasn't really been a lot of growth in the assets. Is it just really good performance, but everybody's just taken their money out of China AMC? Thanks.

Speaker #2: I think you had mentioned strong performance. So it's just what's driving all the money coming out of China AMC versus what may not be the same kind of net flow issue with respect to the investment fund industry.

Speaker #2: And then, if you can help me understand the seed capital gain, or the seed gains you got out of China AMC—just kind of given the fact that there hasn't really been a lot of growth in the assets—is it just really good performance, but everybody's just taking their money out of China AMC?

Speaker #2: Thanks.

Speaker #4: Yeah, good question. And actually, I'll actually address some of the same referees to the transcript from Q1 as well. So over time, and by time I mean the last three years, it's been reported China's national team has engaged in a market stabilization program.

Luke Gould: Yeah, good question. Actually, I'll address some of the same, referring to the transcript from Q1 as well. Over time, by time I mean the last three years, it's been reported China's national team has engaged in a market stabilization program. The way that they did that was by investing in passive ETFs with a number of providers. China AMC was one of those. What we saw in Q1, again in Q2, is in Q1, based upon the strength of equity markets during Q4, we did see the national team. It was reported the national team removed about half of the investment that they had in passive ETFs. That impacted China AMC, given that they have leading market share and they would've been about 20% to 25% of that activity.

Speaker #4: And the way that they did that was by investing in past VTFs with a number of providers and trying to see was one of those.

Speaker #4: What we saw in Q1, and again in Q2, is in Q1, based upon the strength of equity markets, during the fourth quarter, we did see the national team and it was reported the national team removed about half of the investment that they had in passive ETFs.

Speaker #4: And that impacted China MC. Given that they have leading market share and they would have been about 20 to 25% of that activity. And then once again in Q2, equity markets in China, increased by 10% in the second quarter.

Luke Gould: Once again in Q2, equity markets in China increased by 10% in Q2. As a consequence of that, the national team did reduce its holdings of passive equity ETFs further. I don't have transparency into what's left there. What I would say is we view this as real signs of confidence based upon that activity. It is really a bullish sign, the equity market's improving and really the stabilization money's coming out. On the seed capital, it reflects those same trends. The equity markets were up 10% in the quarter. The seed capital on the balance sheet of China AMC participated in that. Does that make sense?

Speaker #4: And as a consequence of that, the national team did reduce its holdings of passive equity ETFs further. I don't have transparency into what's left there.

Speaker #4: But what I would say is we view this as real signs of confidence based upon that activity it is really a bullish sign. Equity markets improving and really the stabilization money is coming out.

Speaker #4: On the seed capital, it reflects those same trends that equity markets were up 10% in the quarter. And the seed capital on the balance sheet of China MC participated in that.

Speaker #4: Does that make sense? But yeah, as far as the main headline is, because of China MC's leadership in passive ETFs and the participation that they enjoyed as part of this stabilization program, that's what explained the outflow in Q1 and Q2.

Tom MacKinnon: Okay.

Luke Gould: Yeah, as far as the main headline is because of China AMC's leadership in passive ETFs and the participation that they enjoyed as part of the stabilization program, that's what explained the outflow in Q1 and Q2.

Speaker #2: No, that's very helpful. And other question with respect to just any kind of guide as to how the advisory fee rate might you've given kind of what you think it would be at IG Wealth for the next quarter.

Tom MacKinnon: No, that's very helpful. Other question with respect to just any kind of guide as to how the advisory fee rate might. You've given kind of what you think it would be at IG Wealth for the next quarter. How should that be trending over the next 24 months, if you will? Just continued pressure? Same with the third party, excluding Canada Life fee rates, that you've provided a guide just for Q3. How should we be thinking about that line going forward? Thanks.

Speaker #2: How would that how should that be trending over the next 24 months, if you will, just continued pressure? And same with the third-party excluding Candlelight fee rate, that you've provided a guide just for the third quarter.

Speaker #2: But how should we be thinking about that line going forward? Thanks.

Speaker #4: Hi, Tom. It's Keith here. I'll start with the IG advisory fee rate. Really what's been driving the fee rate last quarter and this quarter is the move from cash into long-term investment solutions.

Keith Potter: Hi, Tom, it's Keith here. I'll start with the IG advisory fee rate. Really what's been driving the fee rate last quarter and this quarter is the move from cash into long-term investment solutions. I think we'll see a bit more of that in Q3 and Q4. We have distributions at the end of the year where cash increases again, so you'll see that rise. I'd guide to, as I mentioned, a quarter to half a basis point coming down in Q3 and probably less so in Q4. We also did just adjusted how we manage the advisory fee rate. There was that auto reset that we've moved away from to provide more stability in the rate. We think a lot of that change is going to come from just the change in cash.

Speaker #4: I think we'll see a bit more of that in Q3 and Q4. And then we have distributions at the end of the year where cash increases again.

Speaker #4: So you'll see that rise. I would guide to, as I mentioned, a quarter to half a basis point coming down in Q3, and probably less so in Q4.

Speaker #4: And we also did take some—just adjusted how we manage the advisory fee rate. There was that auto-reset that we've moved away from to provide more stability in the rate.

Speaker #4: So we think a lot of that change is going to come from just the change in cash. But as we do acquire more high net worth clients, they're generally going to have lower fee rates.

Keith Potter: As we do acquire more high net worth clients, they're generally going to have lower fee rates, but I don't think you're going to see as much pressure on that rate as what you've seen over the past couple of years. At Mackenzie, the fee rate that we're seeing in the third party rate, it's really been driven by institutional onboarding. If you just neutralize that, the only other real pressure in the fee rate is the mix between mutual funds and ETFs, where we don't charge an admin fee on the ETFs. As that rate comes down with more institutional onboarding, it's going to come with more revenue.

Speaker #4: But I don't think you're going to see as much pressure on that rate as what you've seen over the past couple of years. At McKinsey, the fee rate that we're seeing in the third-party rate I mean, it's really been driven by institutional onboarding.

Speaker #4: And if you just neutralize that, the only other real pressure in the fee rate is the mix between mutual funds and ETFs. Where we don't charge an advice or sorry, an admin fee on the ETFs.

Speaker #4: But as that rate comes down with more institutional onboarding, it's going to come with more revenue.

Speaker #2: Great. Thanks.

Tom MacKinnon: Great. Thanks.

Speaker #1: The next question comes from Brett Dyarsky from RBC Capital Markets. Please go ahead.

Operator 2: The next question comes from Bart Dziarski from RBC Capital Markets. Please go ahead.

Operator: The next question comes from Bart Dziarski from RBC Capital Markets. Please go ahead.

Speaker #2: Great, thanks for taking my questions and good morning, everyone. I wanted to just ask around capital allocation frameworks. So, you're ramping up the buybacks and the dividends paid.

Bart Dziarski: Great. Thanks for taking my questions, and good morning, everyone. Wanted to just ask around capital allocation framework. You're ramping up the buybacks, the dividends paid, but leverage keeps ticking down, and you're at about 1.25 on the gross basis. Is that the right leverage ratio we should be thinking about maybe longer term, or can we see that leverage ratio continue to tick down or maybe would you look to increase it? Thanks.

Speaker #2: But leverage keeps ticking down and you're at about 1.25 on the growth basis. Is that the right leverage ratio should be thinking about maybe longer term or can we see that leverage ratio continue to tick down or maybe would you look to increase it?

Speaker #2: Thanks.

Speaker #4: Yeah, it's Keith here. And I think we've said in the past we're pretty comfortable with a debt to EBITDA ratio that, in the long term, stays under two times.

Keith Potter: It's Keith here. I think we've said in the past we're pretty comfortable with a debt-to-EBITDA ratio that is in the long term, stays under two times. We have a lot of flexibility here. To the extent there's an opportunity that came up, it does provide us with significant flexibility. I wouldn't say we're at the target. We're not planning to bring it down. It's just happening with the performance of our business and the growth in EBITDA.

Speaker #4: We have a lot of flexibility here. To the extent that an opportunity comes up, it does provide us with significant flexibility. So I wouldn't say where we're at is the target.

Speaker #4: We're not planning to bring it down. It's just happening with the performance of our business and the growth in EBITDA.

Speaker #2: Okay. Thanks, Keith. And then just on Rockefeller. So we're seeing the organic growth kind of decelerating, but then the inorganic growth is accelerating. So could you maybe unpack those trends and with the inorganic advisors you're bringing on, where are you bringing them on from and maybe geographically and I know it's within the US, but maybe you could dive into those details.

Bart Dziarski: Okay. Thanks, Keith. Just on Rockefeller. We're seeing the organic growth kind of decelerating, the inorganic growth is accelerating. Could you maybe unpack those trends? With the inorganic advisors you're bringing on, where are you bringing them on from and maybe geographically. I know it's within the US, but maybe you could dive into those details. Thanks.

Speaker #2: Thanks.

Speaker #4: Yeah, it's David. I'll start. What you'll notice with Rockefeller's business is it's seasonal—Q2 tends to be a slower season for organic growth at that firm, so that was true for this year.

Damon Murchison: It's Damon. I'll start. What you'll notice with Rockefeller is it's seasonal. Q2 tends to be a slower season for organic growth at that firm. That was true for this year. On the inorganic side, they have a very unique offering. In a country where there's a lot of conglomerates that are asking wire house advisors to focus on a lot of different things, Rockefeller brings not just an iconic brand, but a chance for corner office investment advisors to focus on what they do best and then surround them with the services that come from the oldest and the largest family office in, multi-family office in the world. That's quite compelling. They're very targeted on who they select for their offering, and they're focused on staffing up in the offices where they have a presence.

Speaker #4: And on the inorganic side, I mean, they have a very unique offering. In a country where there's a lot of conglomerates that are asking wire house advisors to focus on a lot of different things, Rockefeller brings not just an iconic brand, but a chance for investment corner office investment advisors.

Speaker #4: To focus on what they do best and then surround them with the services that come from with the oldest and the largest family office in multifamily office in the world.

Speaker #4: And that's quite compelling. So, they're very targeted on who they select for their offering, and they're focused on staffing up in the offices where they have a presence.

Speaker #4: And they have a number of offices across the country. Their goal is not to be everywhere; it’s to be very specific as to where they feel like their advisors can truly build the brand and build up a significant amount of ultra-high-net-worth clientele.

Damon Murchison: They have a number of offices across the country. Their goal is not to be everywhere. It's to be very specific as to where they feel like their advisors can truly build the brand and build up a significant amount of ultra-high net worth clientele. That organization is built to service clients from CAD 25 million to CAD 100, CAD 200 million, and that's exactly what they're doing.

Speaker #4: I mean, that organization is built to service clients from 25 million to 100, 200 million dollars. And that's exactly what they're doing.

Speaker #2: Got it. Helpful, Damon. Thanks.

Bart Dziarski: Got it. Helpful, Damon. Thanks.

Speaker #1: The next question comes from Graham Riding from TD Securities. Please go ahead.

Operator 2: The next question comes from Graham Ryding from TD Securities. Please go ahead.

Operator: The next question comes from Graham Ryding from TD Securities. Please go ahead.

Graham Ryding: All right, good morning. Just as a follow on Vincent. Rockefeller have a presence in Canada, and if not, does it make sense to consider this market?

Speaker #5: Good morning. Just as a follow-up, Rockefeller, do you have a presence in Canada? If not, does it make sense to consider this market?

Speaker #4: Oh, so Rockefeller obviously does not have a presence in Canada right now. That is they're clearly focused on continuing to build their footprint in the US.

Damon Murchison: Rockefeller obviously does not have a presence in Canada right now. They are clearly focused on continuing to build their footprint in the US. They do believe they have a long runway there. As I said, they have a number of offices, and they focus on opening an office and then scaling that office one by one. That is what their strategy is focused on right now. I do not see that deviating in the short term. You never say never as it relates to Canada, but I know that they are clearly focused on the US.

Speaker #4: They do believe they have a long runway. As I said, they have a number of offices and they focus on opening an office and then scaling that office.

Speaker #4: One by one. So that's what their strategy is focused on right now. I do not see that deviating in the short term. You never say never as it relates to Canada, but I know that they're clearly focused on the US.

Speaker #5: Okay. Great. Luke, just on the China AMC piece, do you have a visibility on what the flows in the quarter would have been if this government intervention was not a factor?

Graham Ryding: Okay. Great. Luke, just on the China AMC piece. Do you have a visibility on what the flows in the quarter would have been in if this government intervention was not a factor?

Speaker #4: Yeah, I think close to it. Add an extra six or seven hundred billion won to the Q2 result.

Luke Gould: Yeah, I think close to add an extra six or seven hundred billion yuan to the Q2 result.

Speaker #5: Okay. So you would have had positive flows then?

Graham Ryding: Okay. You would have had positive flows then at China AMC.

Luke Gould: You're saying for us or the industry?

Speaker #4: You're saying for us or the industry?

Speaker #5: For you. Yeah, for you.

Graham Ryding: For you. Yeah, for you.

Speaker #4: Oh, actually, yeah. See, it'd be slight net positive. Excluding the government outflows.

Luke Gould: Well, actually, yeah. Say it'd be slight net positive excluding the government outflows.

Speaker #5: Okay. That's helpful. The value that you show for Northleaf and your some of the parts, is that pro forma? The incremental 5% stake that you've acquired?

Graham Ryding: Okay. That's helpful. The value that you show for Northleaf in your sum of the parts, is that pro forma, the incremental 5% stake that you've acquired?

Speaker #4: No, that would be the just the 56% ownership. The so that will be increasing that next quarter to reflect the 60.9%.

Keith Potter: No, that would be just the 56% ownership. We will be increasing that next quarter to reflect the 60.9%.

Speaker #5: Okay. Understood. And then my last question is, Damon, IG Wealth, you're sort of been trending at a 1.5% roughly net flows rate since about the beginning of 2025.

Graham Ryding: Okay. Understood. My last question, just Damon. IG Wealth, you sort of been trending at a 1.5% roughly net flows rate since about the beginning of 2025. Is that an appropriate level for the IG Wealth platform, or would you want to target a growth rate above this?

Speaker #5: Is that an appropriate level for the IG Wealth platform or would you want to target a growth rate above this?

Speaker #4: Yeah. That's a I would say that that is an appropriate level for where we are today, where the markets are. When the markets have been flying for the last three and a half years, in our new client acquisition has been very, very strong.

Damon Murchison: Yeah. I would say that that is an appropriate level for where we are today, where the markets are. When the markets have been flying for the last three and a half years, and our new client acquisition has been very, very strong. Generally, what happens is there's a lot of apathy from advisors and from clients to move because everyone's making money. I think when you look over a normal market cycle, I would expect the 1.5% to increase over time, given the value that we're providing to the marketplace and ultimately the demand for the type of advice that we provide is there. I would say part of the market cycle we're in right now, we're very well-placed, and we'll continue to have this strong momentum, but I expect it to increase over time.

Speaker #4: But generally, what happens is there's a lot of apathy. From advisors and from clients to move because everyone's making money. I think when you look over a normal market cycle, I would expect the 1.5% to increase.

Speaker #4: Over time, given the value that we're providing to the marketplace, and ultimately the demand for the type of advice that we provide is there.

Speaker #4: So I would say for the markets like part of the market cycle we're in right now, we're very well placed and we'll continue to have this strong momentum, but I expect it to increase over time.

Speaker #5: Okay, great. That's it for me. Thank you.

Graham Ryding: Okay, great. That's it for me. Thank you.

Speaker #1: Once again, if you have a question, please press star, then one. And our next question comes from Jamie Gloin from National Bank Capital Markets.

Operator 2: Once again, if you have a question, please press star then one. Our next question comes from Jaeme Gloyn from National Bank Capital Markets. Please go ahead.

Operator: Once again, if you have a question, please press star then one. Our next question comes from Jaeme Gloyn from National Bank Capital Markets. Please go ahead.

Speaker #1: Please go ahead.

Speaker #4: Yeah, thanks.

Jaeme Gloyn: Yeah, thanks. First question, just on the Wealthsimple revaluation. Can you break down the driver of that valuation between the strong performance of Wealthsimple and

Speaker #2: First question, just on the Wealthsimple revaluation. Can you break down the driver of that valuation between the strong performance of Wealthsimple and the valuation of public peers you mentioned?

Jaeme Gloyn: The evaluation of public peers you mentioned, and if you could, who are those public peers that you're focused on when looking at the Wealthsimple valuation marks?

Speaker #2: And if you could, who are those public peers that you're focused on when looking at the wealth simple valuation marks?

Speaker #4: Yeah. Hi, James. It's Keith here. Maybe I'll just kind of step back and a little bit of the broad view of valuation. I mean, the first thing we would look to would be is there a third-party transaction in wealth simple?

Keith Potter: Yeah. Hi, James. It's Keith here. Maybe I'll just step back and a little bit of the broad view of valuation. The first thing we would look to would be, is there a third-party transaction in Wealthsimple? There were two that closed in Q4, and we think it's still a relevant mark to look to. A big driver, I would say, for the reset here is just the performance of Wealthsimple to your question about why the reset here. When you look at Q1, Q2 performance for the business, it does drive to reforecast cash flows. AUA up 25% in the quarter, CAD 30 billion in the quarter with net flows, and really since the last fair value mark, assets are up over CAD 50 billion. That's clearly a key driver. To your point, we do look at peer multiples and how peer multiples are trading.

Speaker #4: And there were two that closed in Q4 and we think it's still a relevant mark to look to. A big driver, I would say, for for the reset here is just the performance of wealth simple.

Speaker #4: To your question about why the reset here—when you look at Q1, Q2 performance for the business, it does drive us to reforecast cash flows. AUA is up 25% in the quarter—$30 billion in the quarter.

Speaker #4: With net flows and really since the last fair value mark, assets are up over 50 billion. So that's clearly a key driver. To your point, we do look at peer multiples and how peer multiples are trading.

Speaker #4: When you look at wealth simple's business, it is unique. It's Canadian-based business. It's a very well diversified business. They have an invest platform. They have a trade platform.

Keith Potter: When you look at Wealthsimple's business, it is unique. It's a Canadian-based business. It's a very well-diversified business. They have an invest platform. They have a trade platform. They have a crypto platform. They have a checking and save platform. They're pretty broad relative to any model line peer group. Just to demonstrate the performance of the company and where they're moving, in Q2, they opened up more new checking accounts than they did investment accounts. That just demonstrates the diversity of Wealthsimple. In the peer group, we would look to a variety. Obviously, a lot of folks point to Robinhood. There's certain similarities there. There's eToro. There's Interactive Brokers, but there's many others as well. We would look at a pretty diverse group of peers.

Speaker #4: They have a crypto platform. They have checking and safe platform. And so they're pretty broad relative to any call it monoline peer group. And just to demonstrate the performance of the company and where they're moving in Q2, they opened up more new checking accounts than they did investment accounts.

Speaker #4: So that just demonstrates the diversity of Wealthsimple. So, in the peer group, we would look to a variety. Obviously, a lot of folks point to Robinhood.

Speaker #4: There are certain similarities there. There's eToro, there's Interactive Brokers, but there are many others as well. So we would look at a pretty diverse group of peers.

Speaker #4: And so when you kind of look at where the business performed, where peer multiples are, you look back to the key metrics that existed at the time of these third-party transactions that really drove the increase in value of 15% this quarter.

Keith Potter: When you look at where the business performed, where peer multiples are, you look back to the key metrics that existed at the time of these third-party transactions that really drove the increase in value of 15% this quarter.

Speaker #5: Okay. Thank you. Very detailed. The second question, just on the unallocated capital, you're continuing to buy back shares aggressively, but that unallocated capital, that close to a billion, and it's been this way the last few quarters.

Jaeme Gloyn: Okay, thank you. Very detailed. The second question, just on the unallocated capital. You're continuing to buy back shares aggressively, that unallocated capital at close to CAD 1 billion, and it's been this way the last few quarters. Elevated versus, I want to say, where you would prefer to have it and where we've seen it in the past. What's the strategy for that? Is it to continue to accelerate buybacks at these levels, or are you just going to be comfortable holding that in that excess cash for other purposes, I guess?

Speaker #5: So elevated versus I want to say where you would prefer to have it and where we've seen it in the past. So what's the strategy for that?

Speaker #5: Is it to continue to accelerate buybacks at these levels or are you just going to be comfortable holding that in that excess cash for other purposes, I guess?

Speaker #4: Yeah, James, it's Keith here again. Yeah, after the first half of the year, we were just under 50% of the NCIB for the total year.

Keith Potter: Yeah, James. It's Keith here again. After the H1 of the year, we were just under 50% of the NCIB for the total year. You can expect us to continue to repurchase shares. When you look at the repurchase level, CAD 200 million this quarter and a dividend of CAD 145 million, that's in excess of the cash flow we're generating. I think you will see excess or the unallocated capital come down over Q3 and Q4, our focus is going to be on repurchasing shares. We do expect to have a pretty reasonable balance of unallocated capital at the end of the year, which gives us flexibility as we head into 2027.

Speaker #4: So, you can expect us to continue to repurchase shares. When you look at the repurchase level—$200 million this quarter—and a dividend of $145 million, that's in excess of the cash flow we're generating.

Speaker #4: So, I think you will see excess, or unallocated, capital come down over Q3 and Q4, but our focus is going to be on repurchasing shares.

Speaker #4: We will have we do expect to have a pretty reasonable balance of unallocated capital at the end of the year, which gives us flexibility as we head into 2027.

Speaker #5: Okay. Thank you.

Jaeme Gloyn: Okay, thank you.

Speaker #1: This concludes the question and answer session. I would like to turn the conference back over to Damon Murchison for any closing remarks.

Operator 2: This concludes the question and answer session. I would like to turn the conference back over to Damon Murchison for any closing remarks.

Operator: This concludes the question-and-answer session. I would like to turn the conference back over to Damon Murchison for any closing remarks.

Speaker #4: Thank you, Jason. Let me close on three points. First off, IG Wealth and McKinsey have distinct strengths, strong momentum, and significant room to grow.

Damon Murchison: Thank you, Jason. Let me close on three points. First off, IG Wealth and Mackenzie have distinct strengths, strong momentum, and significant room to grow. Second, our strategic investments expand and diversify our growth opportunity and add additional sources of long-term value to IGM. Third, our financial strength and cash generation allow us to invest in profitable growth opportunities within our business while continuing to return capital to shareholders. We will judge our progress through better client and advisor engagement and outcomes, profitable growth, and stronger earnings. I want to thank our employees and our advisors for their hard work and our clients for their trust. Thank you for joining us today and for your continued interest in IGM, and I hope you have a nice rest of your summer.

Speaker #4: Second, our strategic investments expand and diversify our growth opportunity and add additional sources of long-term value to IGM. And third, our financial strength and cash generation allow us to invest in profitable growth opportunities within our business while continuing return capital to shareholders.

Speaker #4: We will judge our progress through better client and advisor engagement and outcomes profitable growth and stronger earnings. I want to thank our employees and our advisors for their hard work and our clients for their trust.

Speaker #4: Thanks for joining us today and for your continued interest in IGM, and I hope you have a nice rest of your summer.

Operator 2: This brings to a close today's conference. You may disconnect your lines. Thank you for participating and have a pleasant day.

Operator: This brings to a close today's conference. You may disconnect your lines. Thank you for participating and have a pleasant day.

Q2 2026 IGM Financial Inc Earnings Call

Request DemoDemo

IGM Financial

Earnings