Thank you for standing by, and welcome to the Great-West third quarter 2026 results conference call. As a reminder, all participants are in a listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity for analysts to ask questions. To join the question queue, you may press star, then the digit one on your telephone keypad. Should you need assistance during the conference call, you may press zero and star. It is now my pleasure to turn the conference over to Mr. Shubha Khan, Senior Vice President and Head of Investor Relations for Great-West. Please go ahead, sir.
Thank you, Jim. Hello, everyone, and thank you for joining the call to discuss our third quarter financial results. Before we start, please note that a link to our live webcast and materials for this call have been posted on our website at greatwestlifeco.com under the Investor Relations tab. Turning to slide two, I would like to draw your attention to the cautionary language regarding the use of forward-looking statements, which form part of today's remarks. Please refer to the appendix for a note on the use of non-IFRS financial measures and important notes on adjustments, terms, and definitions used in this presentation. We will begin with prepared remarks, followed by Q&A. With that, I will turn the call over to David Harney, President and Chief Executive Officer.
Thank you, Shubha, and good morning, everyone. Please turn to slide four. Great-West delivered another strong quarter with base EPS growth of 11% compared to the third quarter of 2025, which is ahead of our medium-term objective. Base earnings reached a record high, surpassing CAD 1.3 billion, driven by double-digit growth at Empower, together with robust Capital Solutions demand in CRS. Overall earnings growth was partially offset by a continued moderation in insurance experience relative to the record levels seen in 2025. Our results continue to demonstrate our strength in execution and the progress we are making to shift toward a more capital-light business mix. We are pleased to announce that our combined retirement and wealth businesses now comprise more than 50% of the combined base earnings of our operating segments.
In addition, Empower Retirement crossed a new milestone, now serving more than 20 million customers with the close of the Milliman transaction. This quarter also highlights the strength of our balance sheet and our considerable financial flexibility. Year- to- date, we have returned approximately CAD 1.3 billion to our shareholders through share repurchases and ended the quarter with CAD 3.6 billion in cash, of which nearly CAD 800 million has been earmarked for a debt maturity in the fourth quarter. This reflects the strong cash-generative nature of our business, and we expect continued capital deployment through the remainder of the year. Please turn to slide five. As I mentioned, our base EPS growth of 11% year-over-year was led by strong performance across our retirement, wealth, and reinsurance businesses. This drove ROE to a record 19.4% in the quarter, including record base ROE at Empower.
We also continue to strengthen our market-leading position in retirement services and wealth management, with total client assets now at $3.9 trillion, including assets added through the recent Milliman transaction. This acquisition strengthens our defined contribution platform and adds a leading defined benefit capability to our go-to-market offering. Our financial position remains strong, with solid capital and leverage ratios underpinned by the robust capital generation of our businesses. Please turn to slide six. At our Investor Day last year, we reiterated our medium-term objectives for base EPS growth, dividend payout, base capital generation, and base ROE. These objectives are supported by medium-term growth ambitions for each of our segments. Our growth ambitions remain unchanged, and we continue to make solid progress against them. In the U.S., both our retirement and wealth businesses delivered double-digit base earnings growth, supported by strong operating margins.
The growth in both businesses came despite equity market volatility in the third quarter. In Canada, double-digit growth year-to-date in retirement, wealth, and insurance and annuities was offset by continued moderation in group benefits insurance experience. We continue to make targeted investments in a number of areas to improve health outcomes, enhance the customer and advisor experience, and increase operational efficiency. Jon will provide further details on the near-term outlook for the business. Europe remains on track to achieve its objective of mid-single-digit plus base earnings growth, supported by strong top-line sales across product lines. Finally, Capital and Risk Solutions continues to deploy capital opportunistically and generate attractive returns, especially in its Capital Solutions business. Strong global demand for our Capital Solutions offering drove year-to-date base earnings growth of 30% compared to the first nine months of 2025.
Overall, I'm very pleased with the performance so far this year and remain confident in our ability to deliver against our medium-term objectives. I'll now pass over to Jon to talk through the broader financial results for the quarter.
Thank you, David, and good morning. Please turn to slide eight. Great-West delivered another strong quarter with double-digit base earnings per share growth, driven by continued strength in our retirement and wealth businesses and robust demand for Capital Solutions in our CRS business. These results generated a base ROE of 19.4%, in line with our medium-term objective of 19% + for the third consecutive quarter. This strong performance was achieved despite heightened market volatility and higher interest rates, underscoring the resilience of our business mix. As David mentioned, retirement and wealth now contribute more than 50% of base earnings, while our disciplined capital deployment approach continues to create value. During the quarter, we repurchased approximately $340 million of common shares, supporting the 11% growth in base earnings per share. Since the beginning of 2026, we've repurchased approximately $1.3 billion of common shares. Turning to slide nine.
Total credit losses were within our expected range of 4 basis points-6 basis points for the first nine months, though the third quarter amount was higher than the expected quarterly rate. As a reminder, total credit experience is the aggregate of credit experience shown in our drivers of earnings disclosure, as well as in our retirement and wealth P&L statements, all of which are included in the supplemental information package. We continue to expect full-year credit experience to be within the CAD 80 million-CAD 120 million pre-tax range that we provided at the beginning of the year. Turning now to our results by segment, starting with slide 10. Empower delivered another quarter of double-digit growth, with base earnings up 15% in constant currency, reflecting continued organic growth momentum across our retirement and wealth lines of business.
In retirement, we successfully closed the Milliman transaction, adding $134 billion in client assets and contributing to double-digit growth in average client assets. Net plan inflows remain positive, and we continue to expect positive net plan flows for the full-year and anticipate another strong year of net plan flows in 2027 as we look forward. Third quarter retirement results included approximately $21 million post-tax in one-time administrative service fees, which was offset by credit losses above our run rate expectation for the quarter. Underlying business momentum remains strong. Operating margins improved 370 basis points from a year ago, supported by the significant operating leverage in the business. Empower Wealth continued its growth trajectory, with base earnings up 28% year-over-year in constant currency. Operating margins reached a record 42%, up over 4 percentage points from last year, demonstrating both the attractiveness and scalability of our platform.
We also saw a strong increase in net sales at Empower Wealth of approximately 40% quarter-over-quarter. We expect this strong momentum to continue into the fourth quarter. Overall, strong business momentum drove Empower's base ROE to a record 22.9% on a trailing 12-month basis, reinforcing our confidence in delivering double-digit base earnings growth into 2027. Looking ahead, we intend to continue investing in the business, including for marketing and technology initiatives in the fourth quarter. Beyond this year, we expect pre-tax operating margin to be in the mid-30s% for the retirement business and the high 30s% for the wealth business. Turning to slide 11. Base earnings in Canada decreased 6% year-over-year as continued growth in retirement and wealth was offset by moderated disability experience gains compared to the record levels in 2025.
Long-term disability continues to be a focus for us, and we are taking targeted actions to strengthen early intervention, case management, and return to work support. We expect full-year 2027 experience to be broadly neutral, though experience can fluctuate from quarter-to-quarter. Underlying business fundamentals in our Canadian operations remain strong. Retirement and wealth benefited from higher fee income, group benefit sales more than doubled from a year ago, and insurance and annuity sales increased 17% year-over-year. Please turn to slide 12. In Europe, base earnings increased 3%, driven by higher global equity markets, a strong group benefits in-force book, and growth in trading activity. These were partially offset by moderated insurance experience from the elevated levels seen last year. Business momentum continues to be strong, with sales growth of over 50% across all the retail product lines. Bulk annuities, which tend to be lumpy, moderated sequentially.
We continue to have a positive outlook on this market, but we will act with discipline. For the first nine months of 2026, base earnings grew 6% year-over-year, in line with our medium-term objective of mid-single digits plus growth, reinforcing our confidence in the long-term outlook for the European business. Turning now to slide 13. Capital and Risk Solutions delivered another quarter of strong performance with base earnings growth of 17%. Our Capital Solutions business continues to see strong global demand, driving a 38% year-over-year increase in the run rate insurance result in the quarter. While the pipeline remains robust, we expect mid-single digit plus growth going forward as new business volume and insurance experience normalizes. Turning now to slide 14.
Base capital generation exceeded 80% of base earnings in the third quarter, while free cash flow, inclusive of the Milliman transaction, was largely in line with base earnings. This underscores the strength of our organic capital generation and the benefits of our capital optimization efforts. This high degree of capital fungibility supports continued capital deployment while preserving balance sheet strength. Although investment in our attractive growth opportunities and our more capital-intensive business may influence base capital generation, we expect Great-West to remain highly cash generative over time. Turning to slide 15. The strength of our free cash flow generation continues to support meaningful capital deployment. For the first nine months of 2026, we repurchased approximately $1.3 billion of common shares and closed the acquisition of Milliman's retirement and benefits administration business in the United States.
We are happy to report that we expect our share buybacks to be at a similar level as last year. When aggregating with the capital allocated to the Milliman acquisition, we will have deployed nearly CAD 2 billion of capital in 2026. Turning to slide 16. Our LICAT ratio stood at 127%, down slightly from the second quarter, largely driven by interest rate movements. Looking ahead, under normal operating conditions, we expect to maintain a LICAT ratio at or above 125%, even with the seasonality in capital at CRS, which peaks in the fourth quarter. Our leverage ratio increased by 2 percentage points quarter-over-quarter to 29%, while holdco cash rose to CAD 3.6 billion, primarily reflecting the pre-funding of a euro bond issuance of EUR 500 million in July. This funding was completed in advance to refinance an existing euro bond maturing in the fourth quarter.
Excluding the impact of the financing, our leverage ratio was largely unchanged, and holdco cash stood at approximately CAD 2.8 billion, underscoring our strong financial position. Overall, 2026 continues to be a strong year for Great-West, and we are excited about the continued momentum across all of our businesses. With that, I am going to turn it back over to David for concluding remarks and a look ahead.
Thank you, Jon. Please turn to slide 17. As we close out the third quarter, our performance year-to-date has been exceptional, with record base earnings and base ROE in excess of our 19% medium-term target. This reinforces my confidence in the strength of our businesses and our ability to continue delivering against our medium-term objectives. As I look ahead to the coming year, Empower remains a principal growth engine, and we expect to deliver double-digit earnings growth in 2027. In CRS, sustained demand for Capital Solutions provides a strong foundation for continued growth. While 2026 has been an exceptional year and current demand remains favorable, looking ahead, we believe the business will grow at a mid-single digit plus pace.
In Canada, while group benefits experience is expected to remain below the strong levels achieved in 2025, we remain focused on taking the actions needed to strengthen performance over time and expect insurance experience to be neutral overall in 2027. At the portfolio level, our strong capital generation and financial flexibility position us to repurchase at least as many shares in 2027 as we did in 2026. Combined with our strong dividend, this would give Great-West a total payout ratio of over 75% next year, which is leading for the industry. We will remain disciplined in how we put that capital to work, balancing investment in organic growth, strategic opportunities, and continued returns to shareholders. Great-West has a well-diversified portfolio, leading businesses, and experienced teams executing against clear priorities.
I am confident that we can carry our momentum into 2027 and continue creating attractive long-term value for our shareholders. Thank you. With that, I will turn the call over to Shubha to start the question-and-answer portion of the call.
Thank you, David. In order to give everyone a chance to participate in the Q&A, we would ask that you limit yourselves to two questions per person. You can certainly meet you for follow-ups, and we will do our best to accommodate if there is time at the end. Jim, we are ready to take questions now.
Thank you. To our phone audience, we will now begin the analyst question-and-answer session. To join the question queue, you may press star and then one on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone today, please pick up your handset before pressing any keys. To withdraw your question, repeat the steps of pressing star and then one. We will take our first question today from the line of Paul Holden with CIBC.
Thank you. Good morning. First question is with respect to capital deployment. David and Jon, as you both highlighted, highly cash-generative business that continues. You mentioned share buybacks in 2027, expected to be at least as much as 2026. Do I read into that at all in terms of M&A opportunities that you may be looking at? Maybe the market is not really there today, or am I reading too much into that? Is M&A still a priority, and you do see potential opportunities?
Thanks, Paul. We continue to evaluate any and all opportunities in M&A within our existing geographic footprint, and I think we have expressed the past ambitions to continue to grow Empower, particularly in the retirement side. The guidance that we have given around buybacks does not anticipate any major M&A. Obviously, if smaller M&A comes along, we would think of it as incremental to that outlook that we have given with the fourth quarter earnings.
I would not read too much into it, Paul. We remain open to opportunities that come along. If we can get them at the right price, the right returns, or a good strategic fit, or if they add capabilities, we are very keen. We have shown a very good track record in the past, so it is very much just a continued balanced position on opportunities.
Got it. Okay. Second question, I believe it was mentioned that there is a positive outlook for Empower new plan wins in 2027. Just wondering what underpins that expectation.
I think Ed can take that directly.
Sure. Yeah, happy to. As we have shared in the past, we expect net plan sales to be positive in Q4. As we shared with you, occasionally you see some lumpiness in the large and mega space. But as we look out to Q1 2027, we expect net plan sales to be north of $20 billion for the quarter in terms of contractual commitments, and we see a very, very strong year ahead. In fact, as I think I have shared in the past, our organic growth rate in terms of net participant growth in the business is very strong. We are going to add close to 950,000 participants this year, excluding the Milliman acquisition. That is all organic growth. That is essentially growing our share at roughly 5% off a base of 20 million, and that would be roughly 2x the rate of the market.
We are continuing to take share away from the subscale competitors. I see that trend continuing in 2027, and we are really energized about the first quarter. The other thing I would say is, we are very focused on the multi-product sale on the retirement side. You know we bought OptionTrax in 2024. We have integrated that capability. Obviously, we have the Milliman acquisition. But increasingly, clients are now hiring Empower on a multi-product basis. We just got a commitment yesterday north of CAD 1 billion , and that commitment came with defined contribution, defined benefit, stock plan services, consumer-directed healthcare, and our executive services offering. Increasingly, we see that type of expansion, that product expansion occurring both with our existing customer base of over 100,000 sponsors, but increasingly, it is part of our pursuit process and our sales process for new business. Very optimistic about the trend in 2027.
Our next question today comes from Bart Dziarski at RBC Capital Markets.
Great. Thanks for taking the question, and good morning, everyone. I wanted to ask your thoughts around the Empower 401(k) opportunity, just given the election outcomes we saw in the U.S. this week. Any change there in outlook and timing as a result? Thanks.
Yeah, Ed, I'm going to let you take that question directly.
Sure. Yeah, a couple thoughts on the election results. First, I'll start off by saying that retirement legislation has been one of the areas where we've seen very strong bipartisan support, if you go back to SECURE 1.0 and then SECURE 2.0. When I look at some of the leadership changes in the new Congress, Congressman Neal from Massachusetts will be the chairman of the House Ways and Means Committee, and he's probably the most astute on retirement legislation. We're very much aligned with his thinking in terms of expansion and trying to drive more plan adoption, particularly at the small corporate level. I'd say in some respects, we're pretty encouraged.
I think the big variable, frankly, will be more on the regulatory side and what we're going to see in terms of oversight and hearings, particularly as it relates to things like the fiduciary rule, private assets inside the defined contribution system. We know that Senator Warren, who will likely take on the Senate Banking Committee chairmanship, has taken a strong stance against private assets. I think there's likely to be some headwinds, but we're not adjusting our plan in 2027. We're sticking to the guidance that we've given. We continue to see very strong, robust growth in the retirement side of the business, and of course, double-digit growth for the earnings growth for the business overall in 2027.
Okay, great. Thanks. That's helpful. Then sticking with Empower, the margin outlook that you provided, maybe a two-parter on retirement, mid-30s%, you're already tracking at mid-30s% year-to-date, so just wondering why would an operating leverage drive a more rosier outlook there? Then on the high 30s% for wealth, it's an incremental step down versus the year-to-date margin, just give us any thoughts on what are driving those dynamics. Thanks.
Sure. More than anything, it's investment. I just called out on the workplace side the investments that we're making to build out our multi-product capabilities. We're expanding distribution there to drive better product penetration with both existing clients and prospective clients. We are continuing to make investments there. We're also making a pretty material investment in our brand. We've upped that spend pretty dramatically over the last several years. We're looking for roughly a 20% increase in total spend in 2027. That I would say more than anything is what's attributable to some of the moderation on the margins. That being said, I do see us continuing to make really strong progress in lowering unit cost. We've shared with you before that we're looking to reduce unit cost by 10%-15%, and we're on track to do that.
I think there's opportunities for us to exceed that as we continue to leverage pretty aggressive AI rollout across the business. Very optimistic about expense discipline and operating leverage from that perspective. But we are clearly investing in the business, both in terms of technology, brand, and distribution capabilities.
Got it. That's helpful color. Thanks for taking the questions.
I would just add, on the wealth side, we are adding distribution there too. We have over 1,000 advisors today. We'll be adding more to meet the demand and the opportunity that we see.
Our next question will come from Gabriel Dechaine at National Bank.
Hey, good morning. I have a question about the, well, I guess similar to the one I had last quarter, but just an update, I guess, on the group business in Canada. You had record positive experience last year. This year, it's still positive, but trending more negative, I guess. You talk about the actions you're going to take, claims management, I suppose, but what about the repricing outlook? Is this something that is addressable fairly near term? I guess it's probably too hopeful to anticipate something beyond a neutral experience next year if you're repricing it by a certain amount.
Thank you, Gabriel, for the question. Fabrice here. Group benefits long-term disability experience, as you said, continues to be below the strong levels that we've seen in the past couple of years, and especially in 2025. As I've mentioned last quarter, the deterioration is due to both higher claims incidents and also lower claims recovery. What we've seen in Q3 is consistent with what we've seen in Q2, but perhaps a bit more incidence pressure and a bit less recovery pressure. So, there's a change in mix, and the incidence pressure based on the industry information we have would be consistent with what the rest of the industry is seeing. On the second part of your question and the actions, of course, we're strengthening our intervention, we're strengthening case management, strengthening return to work support.
This is a business that's cyclical, and we've had very good results historically managing through cycles, and we continue to manage through cycle on what we can control. On the pricing front, it's definitely part of our toolkit, and we take into account the current experience that we see in our pricing posture, but I'm not going to make further comments specifically on pricing. I might say that just technically the way pricing work, this business is annually renewable for the most part.
There's a cycle of 12- 18 months for any pricing action, the time for pricing to be established and negotiated, then to come into force on a rolling 12-month basis. So, that's what you can expect for pricing actions. But I think we've mentioned expectations for neutral experience next year. I think that's a cautious and appropriate view given the experience that we're seeing and the length of cycles that are typical in disability.
Yeah, I guess the pricing thing that comes to mind, simplistically, we can all assume, oh yeah, they can reprice. It's not the only lever, of course, but since other companies are experiencing the same issue, it's going to be a hard market, and repricing is going to be easy. My words, not yours. But you're also dealing with small to medium-sized businesses that are in a low-growth economy, dealing with trade uncertainty, inflation, a whole bunch of other factors. How easy is it to push through higher pricing?
Without getting into the details of our strategies, I might say that one factor you need to add is also where we were in 2025 versus industry historicals. As I mentioned earlier, incidents at the industry level was very low by historical standards in 2025. So in our view, it is unlikely that we and the industry would get back to these very high experience levels, especially as it relates to incidents experience. However, any long-term trend and experience can be and should be reflected in the pricing. We have also seen in the recent past some players being quite aggressive with rate cap guarantees that limit the ability to reprice on an annual basis. We have been cautious on this, and we will continue to be cautious on this, especially in the current environment. So there is multiple levers here on pricing.
Got it. Now, I will sneak another one in on CRS. Apologies, but that business has been massively outperforming your mid-single-digit growth target, which you have maintained for next year. I get that because there is more episodic sales, kind of short-term contracts, goes through that line. But you got to have a pipeline, so there has got to be some visibility. Is that return to mid-single-digit growth just kind of reiterating your Investor Day targets, or do you expect to outperform it based on what you are seeing in the pipeline?
Thanks, Gabe. Thanks for the compliment. I guess we are pretty happy with the year that we are having, and we have been, as mentioned before, very opportunistic. We have seen some great opportunities, we have taken them. I think when you look at our mid-single digit, you probably should look at it on a longer-term basis, like a medium-term basis, as opposed to just year- by- year. I think that this year was a great year. When I look at the pipeline, there is still lots of demand for Capital Solutions, so it is still looking good. I think some of my pipeline versus last year is maybe smaller deals, more deals, but smaller. So, I would say that our mid-single digit is still a good number. We have also had fantastic experience this year, which is harder to count on.
As you can see on the Canadian side, it comes one year and you may not get it the next year. So, I think that when you look at our numbers, I think mid-single digit plus is a good target.
All right, thanks.
Our next question will come from the line of Mike Rizvanovic at Scotiabank.
Okay, good morning. Wanted to stick with CRS, just to get a better sense of I get the mid-single digit plus, and could be mid-single digit, could be plus. It seems like it's been, to Gabe's point, a very strong business lately. I'm just wondering, is this an industry trend more broadly, or is this something that Great-West is just doing better than others? Is this more of a market share capture? I know it's hard to even size the market, I imagine, in terms of addressable market, but is this industry or something that Great-West is just really good at?
Maybe I'll just open. There is certainly an industry dynamic here. We're very focused on capital generation and being efficient on that point. We deal with external reinsurance parties as well. There is very strong demand, I think, across the insurance industry in all different geographies on better capital management and management of their balance sheets. Then we just have fantastic positions over time and relationships with all of the insurance companies, so we're leveraging off that. Jeff, you might add some more color.
Yeah. I agree. I mean, if you look at other reinsurers, I think most people are having pretty good years because the experience has been good in reinsurance. I think on the P&C catastrophe side, we didn't see a hurricane until October 1st. That's the first time ever, I think, in the Atlantic that we haven't seen any experience there. So, there has been good experience, so that's a phenomenon. I think that we've explained to you guys how we think that the Capital Solutions we sell are probably better valued than other ways to get capital. I think that there's a wave of people who are thinking that way, so we're riding that wave a little bit. But at the same time, we were the very first one pushing this wave, so we're very well positioned.
We've got the right expertise, the right brand, and certainly the right balance sheet to accommodate our clients. So, it's been a little bit of both.
Are you seeing more competition in that Capital Solution space specifically?
Yeah, that's a good question. There is, as I said, the experience has been good, and there's been more capital invested in reinsurance in the last two or three years than ever before. I think some of it is to go after these asset transactions, which we're not really part of. So you've seen a lot of sidecars and new companies in Bermuda that are set up with this. Then some of the large reinsurers, because of the good experience, have gotten more capital to invest. So there's more capital chasing transactions. So there is a bit of that. There's more competition. But again, we're very well placed, and I think we're a leader in the Capital Solution business and will remain a leader there.
Okay. Thanks for that. Just maybe a quick one for Jon or David, just on the buyback. You sound like you are committed to the CAD 1.6 billion or the same buyback level at least versus what you are going to do in 2026 for next year. What is the parameter if there is no M&A opportunities? Are you looking to potentially increase that buyback?
Yeah. Let me start and add to my comments to Paul. Obviously, the buybacks are now a regular feature of our capital allocation toolset. This is the second year in 2026 that we will have done CAD 1.6 billion or so of buybacks, and we happen to also have an M&A transaction this year, which I would characterize as smaller. We look at that as a number that we are going to take into 2027. In normal market conditions, if there is not a significant M&A transaction that comes our way, we are going to have capacity beyond the CAD 1.6 billion. If you think of our guidance, 8%-10% earnings growth, 80% capital generation, and a dividend payout around 50%, we are generating 30% excess capital a year, and we have a really strong balance sheet with over CAD 2.5 billion of free cash sitting at the holdco.
That could go up and down, but our priority number one, maintain a strong balance sheet. We have a lot of volatility in the world. Number two, continue to grow our organic business, pay out a stable dividend, and then it is the trade-off between any M&A opportunities that come, or we are not going to allow cash to accumulate on our balance sheet in perpetuity. We will continue to push on that buyback, and we think a reasonable place to start next year is the CAD 1.6 billion we have done the last two years.
That is very helpful color . Thank you.
A reminder to our phone audience that it is star and one if you would like to ask a question or if you have a follow-up. We will move next to Tom MacKinnon with BMO Capital Markets.
Yeah. Thanks, and good morning. Appreciate the guide on the Empower, both retirement and wealth margins, and the outlook there. Maybe you could elaborate on what you see for Canada wealth and retirement with respect to those margins. The Canada wealth has been around 20%, and the retirement has been around mid-30s%. How do you see that outlook trending into 2027 and beyond? Thanks.
Thank you, Tom, for your question. As it relates to Canada wealth, we are pleased with the performance of the business. We are investing in the business, as we have mentioned before. Examples of that would be the merger of our wealth dealers following recent acquisitions that was done on October 1st and announced then. We are rolling out new technology tools. All of this will create a little bit of pressure on margin, but that is part of our plan, so you can expect 18%-20% margin as we look forward on the Canada wealth business. On the retirement business, I think the level of margins that you have seen recently are relatively sustainable. We continue to invest in the business. There is significant market and operating leverage in that business, so under normal market conditions, you can expect these margins to persist. Of course, that is sensitive to the market levels.
Very pleased with the performance of the retirement business as well. We are seeing strong growth year-over-year, supported by market, but supported also by investments that we are making in the business, and you are probably seeing some improvement in flows in retirement, which we are quite pleased by.
Thanks for that.
Ladies and gentlemen, that concludes our question- and- answer session for today. I am happy to turn the floor back to you, Mr. Khan, for any additional or closing remarks.
Thanks, everyone, for joining us today. Following the call, a telephone replay will be available for one week, and the webcast will be archived on our website for one year. Our fourth quarter and full-year 2026 results are scheduled to be released after market close on Wednesday, February 10, with the earnings call starting at 9:30 A.M. Eastern the following day. Thank you again, and this concludes your call for today.
This brings to a close today's conference call. You may disconnect your lines, and thank you for participating, and have a pleasant day.