Welcome to the IGM Financial First Quarter 2021 Earnings Results Call. 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. Should you need assistance during the conference call, you may signal an operator by pressing Star and zero. I would now like to turn the conference over to Keith Potter, Senior Vice President, Finance. Please go ahead.
Yeah, thank you. And good morning, and welcome to IGM Financial's 2021 first quarter earnings call. Joining me on the call today are James O'Sullivan, President and CEO of IGM Financial, Damon Murchison, President and CEO of IG Wealth Management. We have Barry McInerney, President and CEO of Mackenzie Investments, and Luke Gould, Executive Vice President and CFO of IGM Financial. Before we get started, I would like to draw your attention to our cautions concerning forward-looking statements on slide 3 of the presentation. On slide 4, we summarize non-IFRS measures used in this material. On slide 5, we provide a list of documents that are available to the public on our website related to the first quarter results for IGM Financial. And with that, I'll turn it over to James O'Sullivan.
Okay. Well, good morning, everyone. Q1 2021 was a record-setting quarter for IGM. We achieved record assets under management and advisement in the quarter of CAD 248.5 billion, up 3.6% in the quarter. We also achieved record-high total net flows of CAD 2.2 billion, with strength from IG Wealth Management and record-high Q1 net sales at Mackenzie. IGM's Q1 earnings per share were CAD 0.85, also a record high, up 25% from last year. IGM published its seventh annual sustainability report yesterday. We continue to focus on areas that matter most to our business and stakeholders. Finally, we're thrilled with the growth of Wealthsimple and the value that it has been creating for our shareholders. It's incredible, really, how much the company has grown since the fundraising round in October 2020.
As announced this past Monday, the value of our interest has grown by approximately CAD 900 million, which is equal to CAD 3.78 per IGM share pre-tax. I'll speak more to this in a few moments. Turning to slide 8 on investment returns, we continue to see strong equity market increases across major indices, while fixed income returns turn negative with the sharp increase in interest rates experienced in the quarter. Overall, IGM's average client investment return was 2.7% in the first quarter, and 4.4% year to date, April 30, 2021. To this point, the markets have shrugged off the COVID third wave as governments continue to provide stimulus, and market participants anticipate an economic rebound as vaccines roll out.
While the pandemic is certainly not over as we get hit by the third wave here in Canada, there are reasons to be optimistic as more and more Canadians are vaccinated each day, and we can envision getting back to something more normal in the near future. Turning to slide nine, Q1 long-term mutual fund net sales were CAD 38.8 billion for the total industry, and CAD 18.9 billion for industry asset manager peers. This is the best fund industry Q1 net sales in Canadian history. Turning to slide ten on IGM's results for the first quarter. Average assets under management and advisement of CAD 243.9 billion increased CAD 57.9 billion, or 31.1% year-over-year, including approximately CAD 30 billion related to the acquisition of GLC and Greenchip, which closed in December of last year.
Q1 2021 net earnings per share of CAD 0.85 is a record-high first quarter result for IGM, representing a 25% increase relative to last year. Slide 11 highlights earnings contributions from each of our segments, where we have brought our disclosures down to the net earnings line, as announced in March of this year. IGM's year-over-year increase in net earnings was driven by strong results within wealth management and exceptional growth at Mackenzie and China AMC. Our proportionate share of Great-West Lifeco's earnings also increased meaningfully compared to Q1 2020. Turning to Slide 12, IGM consolidated net flows were CAD 2.2 billion during the first quarter, a record-high result driven by impressive net flows at both IG Wealth and Mackenzie Investments.
I believe this quarter's results demonstrate continued momentum in these businesses that Damon and Barry will speak to in greater detail in a few moments. As I mentioned, we released IGM's 2020 sustainability report yesterday, which can be found on the IGM Financial website. The report includes comprehensive information for you and your colleagues, and has been prepared in accordance with GRI standards. Within the report, we also provide an index aligned to SASB disclosures and a TCFD report. We're focused on the material ESG topics that matter most to IGM and our stakeholders, with our strategy focused on building financial confidence, growing sustainable investing, and accelerating diversity, equity, and inclusion in finance. In 2021, we are also focused on furthering our role in combating climate change and implementation of the TCFD recommendations.
We're proud to be recognized at a leadership level for CDP for the 4th year in a row, and being named to Corporate Knights 2021 Global 100 Most Sustainable Organizations. I'm pleased to be leading a company where sustainability is integral to who we are, and we are continually evolving what we do to make the greatest impact for our company and our stakeholders. Turning to slide 14, Wealthsimple has experienced extraordinary growth over the past six months, with AUA increasing by 54% to CAD 12.7 billion, and clients growing more than twofold to over 1 million. The equity raise has demonstrated the value being created for shareholders, with IGM's interest valued at CAD 1.45 billion, which is a compound annual return on investment of approximately 80% on our investment of CAD 187 million.
As part of the fundraising round, we will be participating in a secondary offering, with proceeds of approximately CAD 295 million pre-tax, and will continue to be the largest shareholder with a 23% fully diluted interest, valued at CAD 1.15 billion. The transaction accomplishes three key things: One, it includes a new funding round that will support Wealthsimple's strong momentum and growth. Two, it provides IGM the ability to monetize value for our shareholders while remaining a significant owner of Wealthsimple and continuing to support the company as it creates additional value. And three, the voting control is maintained by the Power Group, which provides strategic flexibility. Proceeds from the transaction provide us with financial flexibility or dry powder, which could be used for financially attractive acquisitions that bring new capabilities or access to distribution.
We would also look to share buybacks in the context of our overall capital allocation priorities and opportunities. The growth and evolution of Wealthsimple and our other strategic investments further reinforces the importance of applying a sum of the parts approach to valuing IGM. Luke will expand on this in his remarks, but first, I will turn the call over to Damon to review IG Wealth's results.
Thank you, James. Turn to IG Wealth Management's highlights for the first quarter of 2021 on slide 16. AUA increased 3.6% during the quarter to CAD 1.7 billion, driven by a combination of client investment returns of 2.6% and net inflows of CAD 1 billion. Net flows were the best result in over two decades. We saw record high gross inflows with increased client productivity, which was driven by success in the mass affluent and high net worth segments of the market. And net sales into IGM products were CAD 713 million during the quarter, a substantial improvement relative to net redemptions of CAD 36 million during Q1 of last year.
I'll also discuss the strong performance of our profile fee-based program and the recent announced enhancements, including the expanded use of private market investments and alternative investment strategies. Turning to slide 17. This highlights our net flow results at IG over the past decade on the left, and you can see the strong net flows over CAD 1 billion in the quarter. The chart on the bottom left and on the right demonstrates how our momentum, which really started in early 2020, has continued into April, with both net flows and net sales improving relative to recent years. April is typically a seasonally slow month, but we had a record-breaking month this year.
Growth, gross inflows of over CAD 1 billion is an all-time high for the month of April, and net inflows of CAD 131 million is the best in 20 years and the third best all time. Turning to slide 18. Q1 2021 gross inflows increased approximately 21% year-over-year to CAD 3.6 billion, the highest Q1 result in the history of the company. At the same time, our gross outflow rate improved from 11.2% to 10.2%. You can see the substantial improvement on net flows and net sales in the IG Wealth Management Mackenzie products. I'll take a little bit of a deep dive on this on the next slide. So let's turn there to slide 19.
On our last call, I walked through some of the changing dynamics in IG's offering, our AUA and net flow, flows growth, and how AUA transitions to AUM. Starting on the left part of this slide, in the second column, you can see that Q1 2021 net inflows of CAD 1 billion, which was comprised of CAD 649 million of cash and short-term savings, and CAD 365 million of third party in-kind transfers from other dealers. In the third column, during the same time period, we have seen significant outflow from these categories, resulting in net sales into IG managed solutions and Mackenzie Funds totaling CAD 713 million.
As we move forward, we expect deposit flows and in-kind transfers of third party funds and securities from other dealers to continue to increase, driven by new client acquisition, increased share of wallet from our existing clients, and recruitment of experienced industry advisors. Flow into our managed solutions will also continue as consultants work with their clients to provide comprehensive financial planning and leverage the benefits of utilizing well-constructed managed solutions. Now let's turn to slide 20. I'll touch on the productivity of our consultant network and the key driving factors behind this trend. Both our consultant recruits and our experienced consultant practices delivered significant increases in productivity in Q1 relative to past years.
As we mentioned on prior calls, the success of our consultants are having is related to new client acquisition within the mass affluent and high net worth segments of the market, and increasing our share of assets with our existing clients. This quarter, we have some impressive stats to share with you in this area as we look at our growth inflows through our new lens on the right-hand part of the slide. Inflows from households that have over CAD 500,000 or more with IG rose 30% year-over-year and 76% relative to 2019. And within these figures, flows from new client acquisition nearly doubled over the past two years.
Q1 2021 gross inflows from client relationships with less than 500,000 also increased by approximately 23% relative to two years ago, with the vast majority of this increase coming from the CAD 100,000-CAD 500 ,000 mass affluent segment. These are great results for our consultant network, and I'm very proud of the progress we've made so far. But even with these results, we are clearly still building momentum here as we continue to invest in our platform, our people, and our capabilities. Now let's turn to slide 21. This slide highlights the recent enhancements to our iProfile private portfolios. Where we're building on historically strong performance. For context, iProfile includes a series of fee-based solutions with approximately CAD 22 billion in AUM that is well positioned...
that well positions us for the mass affluent and high net worth segments of the market. Performance of the iProfile program has been quite strong, but these assets have never been captured in our reporting performance information in the past. Starting in Q1, however, this changes, where iProfile performance is now being reported by Morningstar and included our MD&A. As of March 31st, 84% of the AUM in iProfile is rated 4 or 5 stars by Morningstar, and 100% is rated 3 stars or better. We've been continually stepping up our game as it relates to our product capabilities aimed at servicing the mass affluent and the high net worth segments of the market, and iProfile has been a key focus of ours.
During the month of March, we announced the introduction of discretionary model portfolios that will be rebalanced as outlined in our investment policy statement, specific to each client's investment goal. At the same time, we've added 6 new private pools that bring new tools to the program, including expanded use of alternative investment strategies and private market investments. This slide highlights an example of one of the model portfolios. Building on this, in April, we introduced a new private equity mandate within the U.S. equity pool and announced commitments to Northleaf Capital Opportunities Fund. Going forward, the discretionary model portfolios will include active asset allocation, public equity and fixed income securities, liquid alternatives, and a range of private market investments, including private real estate, private credit, and private equity. These solutions will continue to offer access to leading global asset managers, like Mackenzie Investments and Northleaf Capital Partners.
Lastly, let's turn to slide 22. Having excellent products like iProfile is critical to our success, and these products are deployed with one goal in mind, to fulfill the financial plan tailored to meet the needs and the goals of each of our respective clients. As a reminder, at IG, we refer to our financial plans as IG Living Plans, and fulfilling an IG Living Plan requires more than just investment products. Our estate planning, mortgages, cash management, insurance products, and services are equally important. Consultant and client usage of these products was another highlight for this quarter, with our insurance volumes and mortgage fundings increasing 23% and 25%, respectively, from last year. In addition, all-in-one HELOC origination volumes were up 56%.
You will continue to see an emphasis on these areas and growth in these areas, as a part of the business going forward. I'll now turn it over to Barry McInerney.
Thank you, Damon, and good morning, everyone. I'll begin my comments on Mackenzie's Q1 results on slide 24. We reached a new record high total AUM of CAD 191.6 billion at the end of the quarter, driven by strong returns for our clients and all-time high Q1 net sales of CAD 1.5 billion. Our record net sales reflect both strong Canadian retail investment fund industry flows, which also broke records in the quarter, and our continued ability to win market share from our competitors. Q1 marked our eighteenth consecutive quarter of positive retail investment fund sales, and the momentum continues to be broad-based across asset classes and categories for both mutual funds and ETFs. We also achieved several important milestones to further build on the momentum of our sustainable investing offerings.
I'll elaborate on the subsequent slide, along with a few highlights on our strategic relationship with Northleaf Capital Partners. Slide 25 highlights investment fund flows, which include adjustments for large fund allocation changes that can impact the comparability of results over time. The chart on the top left compares Mackenzie's record-breaking quarter to the last decade. You can see that our 2021 net sales results are a multiple of prior years. This pace has continued into April, with record high investment fund net sales of CAD 539 million during the month and CAD 6 billion on a twelve-month trailing basis. Slide 26 presents Mackenzie's Q1 2021 operating results. Total mutual fund gross sales of CAD 4.5 billion were up 23% year-over-year, driven by our retail business.
Mackenzie continues to gain market share, as demonstrated by our long-term investment fund net sales rate, which was 8.1% at the end of April. In terms of Morningstar ratings, 49% of Mackenzie's AUM were in 4- or 5-star rated funds, and 15 of our top 20 funds are rated 4- or 5-star for F series. Turning to slide 27, Mackenzie's results in the retail channel have been very strong, with first quarter investment fund net sales of CAD 1.9 billion, including CAD 1.6 billion from mutual funds and CAD 300 million, primarily from active and strategic beta ETFs. There are a few catalysts for our success. Mackenzie's top-rated sales organization in the country, a wide-ranging suite of investment products and solutions, supported by both strong performance and innovation.
Of our top 20 net selling funds in Q1, five were launched within the last 1- 2.5 years, which means they did not yet have Morningstar ratings, and a very favorable retail operating environment that has only amplified the opportunity for leading players like Mackenzie. Slide 28 outlines the breadth of our retail net sales strength across our investment boutiques and the short-term investment performance dynamics that we've seen in recent months. After an extended period of outperformance of growth-oriented funds, we witnessed strategies which were, with value tilts, beginning to outperform. Our capabilities in the value space are represented by our Cundill and North American equity teams. While their value-oriented products lagged their growth peers previously, the recent shift in market dynamics has led to near-term outperformance by these two boutiques, as measured by the 6-month asset-weighted percentiles.
It's, of course, difficult to say where exactly markets go from here and whether value or growth will outperform in the near term. At Mackenzie, we're focused on being Canada's preferred global asset management solutions provider and business partner, and our multi-investment boutique structure positions us well to have relevant and strong performing investment products through various market cycles. I would also note on this slide that we are seeing exceptional flows into sustainable investing, which leads us to our next slide. Slide 29 highlights Mackenzie's five growth catalysts that are reshaping the global asset management industry. I'd like to highlight a few developments on the sustainable investing and private markets themes today. As we discussed on our last call, we acquired Greenchip Financial during December, bringing in-house the strong capabilities behind our top-performing environmental equity fund.
As of March 31st, this team now manages over CAD 1.4 billion. Building on this success, we launched the Mackenzie Greenchip Global Balanced Fund during April, the first environmentally themed balanced fund available to Canadian retail advisors and investors. This fund brings Greenchip's capabilities to the important balanced category and leverages our fixed income team's established, sustainable investing expertise. We also launched the Mackenzie Global Sustainable Bond Fund, one of just a handful of sustainable fixed income products available in Canada today. Also, in the month of April, we established our second sustainability-focused investment boutique. This new boutique will be led by Andrew Simpson, who has 20 years of experience in investment management and has played a pioneering role in the Canadian sustainable investing space.
Mackenzie's approach to sustainable investing is provide Canadians with the opportunity to invest with impact through funds that are designed to generate long-term competitive returns while supporting positive ESG outcomes. We are working to strengthen the role of sustainability in our culture, corporate practices, and every investment decision we make. Our partnership and equity ownership in Northleaf represents a key part of our strategy in the alternatives and private investment markets. We are excited about the excellent fundraising of CAD 1.5 billion achieved by Northleaf, the Northleaf team, during the first quarter of this year. During March, we officially launched our Mackenzie Private Credit Fund, which brings Northleaf's private credit capabilities to Canadian retail in a new and exciting way, and we have concrete plans to launch additional private markets products in the near term. I will now turn things over to Luke.
Great. Thanks, Barry. Morning, everybody. So I'll turn to page 31, and all I'd highlight on this slide is you'll see the 3.6% growth in assets under management and advisement during the first quarter, bringing our AUM and A up to CAD 248.5 billion, driven by good investment returns, as well as CAD 2.2 billion in net flows. I'd also highlight that on Wednesday, we released our April results, and you can see that April had AUM and A up to CAD 253.1 billion, another 2% increase, driven by record high April net flows of approximately CAD 600 million, as well as continued market performance.
At this level, I'd highlight we're about 3.8% above the average asset balance in Q1, so we have some good growth heading into the second quarter when it comes to earnings and momentum. On page 32, you can see our EBIT and our EBIT margins by quarter. On the right, I'd highlight in the very right column, that we had the full impact of the acquisitions of GLC in Q1 and Greenchip, and the GLC transaction closed on New Year's Eve and delivered us a net CAD 30 billion in additional money to manage. That is at lower weighted average fees, and as a consequence, you can see that the weighted average margin declined during the quarter.
You can see in the top right that we've normalized the margin to exclude the impact of the acquisition, and the margin was 46 basis points on this basis and was in line with last year and was a stable trend. I'd also remind, as you can see in the bottom left, Q1s are seasonally high quarter for expenses, as promotional and processing expenses are higher as a result of the RSP season. I'd also remind that Q1 has seasonal weakness in revenues as our fees are expressed as an annual percentage of assets, and we only have 90 days of revenue this quarter. Turning to page 33. You can see our consolidated statement of earnings and our CAD 0.85 per share result, up 25% from last year and in line with Q4. I have a few quick points I highlight on this slide.
First, would be a reminder. If you look at the top row there, we've indicated the number of days in the period. As mentioned on the last slide, because February had less days, Q1 has a number of peculiarities that affect various line items, and I'm gonna highlight more of that on the coming slide. I would remind that revenues are accrued based upon number of days, so we get 93/65 of the annual revenue rate during this quarter. Second, if you look at the first highlight two in the middle of the page, you'll see that business development expenses of CAD 79 million are unchanged from last year and down CAD 9 million from Q4. I'd note that this is a bit below our full year guidance due to timing of promotional expenses.
I'd also remind that Q4 expenses were elevated by about CAD 10 million due to an increased Mackenzie sales compensation at the very end of the year. As indicated last quarter, we reset the bar on this compensation every year, and we raised the bar for 2021, and as a result, the expense is running at much lower levels. I'd also remind that we've given the guidance, and you can find it in page 42, that shows how this line is gonna vary based upon sales activity and what you can expect if Mackenzie continues to achieve the type of growth it's putting on. Third, if you look at the second highlight two in the middle of the page, you'll see our consolidated operations and support expenses are up CAD 11.4 million or 5.9%.
I'd remind you that this includes CAD 6 million of impact from the GLC acquisition and also includes CAD 1.5 million in higher pension expense that we disclosed last quarter was coming on. Excluding these two items, we're up 2%, which is just a bit better than our full year guidance that we provided. As you can see in call out point 2 on the right, we're keeping our full year expense guidance unchanged, and we've provided that guidance on appendix slide 43. Moving to page 34. A few comments on our results by segment and by component. The first, as indicated by James, this is our first quarter reporting down to net earnings line at the segment and component level.
As mentioned to you on our March eleventh call, when we released this disclosure, we believe this change better reflects the business performance of the segments and enables the use of PE, and it's also intended to encourage a sum of the parts approach to value, as well as making sure we're positioning the different businesses against appropriate global peer groups. I've also called out in point two, a few noteworthy items. First, as a reminder, as mentioned by James, that the Wealthsimple offering and revaluation of our stake is CAD 1.5 billion in value. I'd remind you, we recorded this investment as fair value through other comprehensive income, so there's no contribution to our earnings from Wealthsimple.
Second, our secondary transaction will close in a few days, and we'll receive CAD 295 million in proceeds, and we'll continue to have a $1.2 billion stake in the company. I'd also highlight that ChinaAMC's earnings are up 41% from last year, and we've highlighted here that they declared and we received in April, our annual dividend, which was CAD 26.8 million. This dividend doubled from last year as a result of the earnings growth, as well as an increased dividend payout rate from 40%- 65%. Look at the increase in net earnings by segment. I'd highlight the 49% growth in Mackenzie's earnings, and this was up 42%, excluding the impact of acquisitions.
As you saw in Barry's section, Mackenzie looks poised to continue net selling in retail at a rate of over 10% of assets per year. There's a lot of operating leverage in this business, and we expect continued earnings growth at very healthy levels. At the bottom right, we put a sticker on the value of these investments in strategic investments at CAD 4.2 billion. This is based on the trading value of Great-West Lifeco shares, our entry-level PE of 17.5x China Asset Management earnings, our purchase price for Northleaf, and the carrying value of CAD 1.5 billion on Wealthsimple, and CAD 291 million of excess capital that we hold in very safe and liquid investments. Turning to page 35.
We've reflected consensus analyst, analyst earnings estimates at the time we went to press for IGM Financial of CAD 3.81 for 2021. We've shown the allocation of these earnings estimates by segment and component. Much like we did on March eleventh, we've taken the share price of CAD 44.75 when we went to press on this deck and allocated it to these components by using our CAD 4.2 billion assessment for strategic investments reviewed in the last slide, and allocating the residual to IG Mackenzie proportionate with their earnings. You can see at the bottom, we've circled the implied PE of IG Mackenzie, which on this basis is 8.4 times.
And then we've compared this 8.4x to the average multiples of global publicly traded large cap wealth managers in the case of IG, and asset managers in the case of Mackenzie. We've disclosed that these peers are trading on average at multiples of 15x earnings, and we obviously would encourage you to look at the strong momentum in IG Mackenzie's earnings that are being put on right now. Turning to page 36. Just a few quick comments. First, you can see that advisory fee and product and program fee rates are in line with expectations and guidance. I would comment on our asset-based comp because of a peculiarity in how it's paid in the industry. Unlike our revenues, asset-based comp at IG Mackenzie is paid at 1/12 the annualized rate each month. What this means-...
is that if someone estimated this compensation by multiplying the annual rate by 90 days over 365 days, they'd understate this expense by about CAD 2.7 million. We presented the rate here in both bases. As actually paid, you can see the rate increase, increased by about 0.6 basis points, and we would expect the rate to be around 47 basis points for the remainder of the year. The reason for the slight increase in this line was there was a greater proportion of AUA subject to this compensation, which means there was less cash, less money market fund, and less interest savings account in the base, which we don't pay asset-based comp on. On page 37, you can see IG's income statement with earnings of CAD 110.5 million in the quarter. I'd make two comments.
First, you can see in other financial planning revenues, we had an increase of 15.8% year-over-year, reflecting higher insurance and mortgage volumes, which Damon reviewed with you a few slides earlier. I'd remind you that insurance is seasonal and our peak sales season is Q4. So we view this year-over-year growth in Q1 as very encouraging. And as Damon mentioned, our comprehensive financial plans are focused, and we see significant opportunities for further increase in the use of insurance, lending, and other banking products within our financial plans. Second, you can see our operations and support expenses are up 2% or CAD 2 million from last year. This is right in line with our guidance of 0.5% growth, plus the CAD 1.5 million per quarter interest expense that came on due to interest rate increases last year.
We've given a footnote at the bottom right, just to give you guidance going forward, that as a result of interest rate increases in the quarter, you'll see in our financial statements that the funded status of our pension improved by just over CAD 100 million pre-tax in the first quarter. I'd let you know that under the accounting requirements, annual pension expense is set at the beginning of each year based upon the rates prevailing and assumptions prevailing at that point in time. But I would let you know that had the current rates been in effect at January first, our 2021 pension expense would have declined by CAD 1 million as opposed to increasing by CAD 6.5 million. We point this out as this is obviously a tailwind for us moving beyond 2021, that you should be aware of.
Moving to page 38, we presented the net asset management fee rates for Mackenzie on the right-hand side. You can see the impact of the GLC acquisition coming on during the quarter, and the 53 basis points is right in line with expectations and guidance. We've also included the fee rate, excluding the impact of the acquisition of 68.7 basis points. And I'd just highlight to you, the rate's down very slightly in the first quarter for a few of the same reasons discussed in the IG section. First, some dealers still continue to sell DSC, and we had an increase in the payment of sales commissions, and these are expenses incurred. This is a CAD 2 million increase from Q4 and is included in this rate.
Second, as mentioned earlier, the asset-based comp is paid at a quarter of the annual rate versus 90/365, and this was worth another basis point in decline. So very stable, fee rates, and these fee rates are obviously being supported by the strength in retail. On page 39, you can see the Mackenzie income statement. CAD 48 million in net earnings was an increase of 49% from last year and 18% from last quarter. As you look through the percent changes, you'll see the operating leverage inherent in the business, given the extent of fixed expenses. In the second point, you can see that operations and support expenses increased by CAD 8.8 million from last year. As guided last quarter, CAD 6 million of the increase was the GLC and Greenchip acquisitions. This does include purchase price amortization.
Excluding this, the expense was up 3.7%, which is the lower full year guidance of 5%. We also mentioned earlier, business development expenses of CAD 20 million are at the same level as Q1 in 2020, and I'd remind you that on page 42 in the appendix, we've given guidance on how this line item will vary based upon different levels of retail sales activity. This concludes my comments. I'll open up to questions.
Thank you. We will 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 are using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two. To join the question queue, please press star then one now. Our first question comes from Nick Priebe of CIBC Capital Markets. Please go ahead.
Hi, good morning. Just wanted to start with a question on investment performance. One of the things that stood out to me was I noticed the proportion of fund assets at Mackenzie ranking above median on a trailing twelve-month basis, moved from the high 70% range in Q4 to 22% in Q1. Just wondering how I should interpret that? Like, would that, would that have been related to a particularly strong period of relative performance in Q1 2020, rolling off that TTM period? Or, how would, how would you attribute that sequential change?
Sure. Great question, Nick, and you're right, actually, it's Barry. So just quickly, so, the short-term performance, you're right, our Q1 2020 was exceptionally strong, and we actually, with all of our boutiques collectively, we, we probably performed best at Mackenzie during down markets and choppy markets, which we certainly had in Q1 2020 and into 2020 Q2 rather. And so we had historically, high, you know, percentage of, of and five star AUM. Double, double-edged sword, obviously, because our, our AUM, our percentages might go up when the markets are choppy and downwards, and therefore consumer confidence is low and therefore flows are low. And our markets are going one way, as they have been mostly, upwards. We might lag a bit, with, with some of our performance.
But overall, if you look at our 4 or 5 star percentages, it's usually 40%-60% in terms of our AUM over the long term. And so we were at the high end, you know, the first couple of quarters last year, and again, we dropped off at Q1 in 2020. We're down about 49-50%, which is actually about average, and we're very comfortable with that level. If I may, though, on the long-term number,
... The percentage of five-star has actually remained relatively consistent the last several quarters. And as you know, the vast majority of preponderance of our flows are going into our five-star funds and, or, and into our no-star funds. I mentioned in, in my remarks because we've had success and launched some really attractive new products that have yet to garner a Morningstar star, because they're less than three years old, and those flows have been very, very strong. You know, there's, there's 5 or 10 of them easily. The top couple, for instance, you probably know the Global Environmental by Greenchip and the Bluewater Global Balanced, they're both under three years old, and they are collectively up to about CAD 2.3 billion in AUM. So obviously, when they come on board with their stars, that numbers will go up.
But I think you've got it about right. The long term is, where we think we are, roughly 46% at the mid-range. The five stars have held. The four stars have come off a bit, obviously, with the math, and someone like an Ivy foreign, a big fund, but it toggles between three and four star. It goes up to four or five star when, again, markets are down, 'cause it's a really downside risk protected type of building block, and then they lag a bit when markets are up. So very explainable. In slide 28, if you recall, you see the all the boutiques that we have.
These aren't all our boutiques, but these are the ones that supply Mackenzie Mutual Funds, and we've got probably the most broad array of, of styles, probably of any manager in Canada. And a particular note on the left, as I mentioned, are value oriented. You can see those numbers where their performances popped last six months, and whereas been lagging, obviously, for quite some time as growth outperformed value. And then you see our growth oriented, which are still holding five-star, amazing, particularly growth in Bluewater. But they have their performance adhering to their style, which they have, has come off a bit the last six months or so. So we just rotate with advisors. We're starting to have a lot of discussions with advisors on value.
You know, most of these teams are fundamental, but our quantitative team, you can see exceptional short-term performance. They're coming back. So it's really advantage to the our model of multi-boutique. We're able to rotate different styles, but really it's important that I stress this, that our wholesalers partner with advisors to help them build more enduring portfolios with building blocks and not pushing a hot product. And we think all of these value growth, quant, fundamental, emerging market, domestic, and now alts, all play in a really strong role collectively in a portfolio. Hope that answers your question. Thank you.
No, that's helpful. Very thorough. And then just switching gears on the Wealthsimple financing round. Luke, I think you had alluded to the fact that the proceeds from the secondary offering that you participated in will give you greater financial flexibility, but are they earmarked for anything specific, or, you know, are you comfortable holding a greater level of excess capital and balance sheet until you can find a suitable redeployment opportunity?
Did I say-
Yeah, sorry, it's James.
Go ahead, James.
They're not earmarked for anything specific at this point. Nick, M&A is clearly a possibility, as are share buybacks. And as we've said previously on M&A, you know, we're attracted both to wealth management and to asset management. We like wealth management because of its stability, the resiliency of the earnings profile. And any interest we had there would be, you know, that would be Canadian based, and it would be skewed to high net worth. On the asset management side, you know, Barry has spoken regularly about his five growth levers, China, alts, retirement, ETFs, SRI. Those are areas of potential interest. And on share buybacks, what I'd say is we view it as, you know, it's an important tool.
You know, if it's done properly, it can be a driver of EPS and a driver of ROE, and if we wanted to, we could file a normal course issue r bid pretty quickly. So, we don't have specific plans at this time, but we have a fair bit of financial capacity, and I think that's important to point out between unallocated capital, which is pushing CAD 300 million before the secondary, the Wealthsimple proceeds, you know, senior debt capacity and potentially, you know, other stakes that could be that we have that could be monetized. I think we've got a fair bit of dry powder and a lot of optionality in a market that is in an economy that is reflating.
Okay. Thanks for taking the questions.
Our next question comes from Gary Ho of Desjardins Capital Markets. Please go ahead.
Thanks, and good morning. First question, Barry, just want to go back to Nick's question on the performance, and you mentioned the shift from growth to value. You know, if that plays out, are you able to capture that churn? Just notice on slide 28, the performance of your growth funds are quite a bit better than the value. And do advisors look at the six months more or more on the three-year numbers?
Great question. Yeah, so the way we present this with advisors, and more and more, we're having some, I think, very thoughtful discussions with them in that when you're, again, building a portfolio, the well-diversified portfolio really should have a role of both value and growth. Now, as I mentioned in prior calls, in Canada, we don't have style-specific universes. The United States has style-specific universes, so you have a value universe, a growth universe, a core universe. In Canada, it's sometimes difficult to put value in a portfolio when it's underperformed for 10 years, because you're right, they're all the value managers are usually one star. So because it's the growth, the style has been so pronouncedly strong growth versus value, except of course, the last 6 months.
But we've been signaling this for a couple of years now. And to point to the fact that to take some gains off the table to rotate a bit back to value, to have a more diversified portfolio. It has been resonating. So I think it's been an educational process for the last couple of years, and it might take another couple of quarters. But yes, to answer your question, we think we would benefit. By the way, there's not very many value managers left. It's unfortunate. I've been through this for 25 years now when I was in the United States, and you know, the high tech boom of the late 1990s, where value was dead, as they were declaring, which is never dead. It's a wonderful style.
It offsets growth very well. Value is a little different nowadays than it was 20 years ago. But I think that there's a lot of interest in discussions we've had- we're having right now with advisors on the whole side to say, "Listen," they are listing the fact that they should rotate and put some more into value and have a nice balance between value and growth. And we would actually, we believe we're well positioned. We have two very good value managers in our Cundill and our North American Equity side. Not many, as I said, of the value managers left. Ours are good, very good. Stick their style, and you should start to see some flows coming into the value side in Canada in short order. So we'll see. But we're...
That, that's again, our portfolio construction-led sales process. Here's your well-diversified portfolio. Here's how you put these building blocks together. And there's good discussions going on right now, and I think you're right, you'll see some value flows come forth shortly. You can see, for instance, the redemptions have really stopped. There's no redemptions right now out of value. It's just more of a sales issue with coming North American Equities, and we think this is gonna pop relatively soon. Thank you.
Got it. Great. Thanks for the color. And then second question, maybe for, for James. Just when I look at slide 34, one of the bigger discrepancies in carrying value and fair value is your ChinaAMC asset. You know, we've seen the monetization Personal Capital Wealthsimple last week. What alternatives are you looking at on, on the ChinaAMC side?
Sure. Well, that's an investment we're proud of. That investment reflects, to be frank, 50 years of relationship building in China. And we very much view China AMC as a best-in-class asset. It's a—I think it's a clear leader in their field. And so when you bear in mind that China represents, you know, the second largest equity market globally, the second largest bond market, I think Canadians are gonna want exposure as part of a globally diversified portfolio that, you know, satisfies their retirement needs. So, for all of those reasons, we like the asset, and we would, in the fullness of time, consider more if that opportunity presented itself.
Okay. And then my last question, perhaps for Luke. On slide 42, where you gave us the sensitivity of business development expense relative to Mackenzie's growth sales. Just curious, you know, your crystal ball, especially on the right bar charts there, what are you accruing for, given strong sales, and how should we think about this number for the balance of the year?
Great question, and if we continue to pull this growth, there's gonna be some variability from Q1's level, and so we'll be assessing each quarter. If you look at what's being put on, and we've got April, we've now got a few days in May, we're heading to the right-hand side of page 42 there, with the... It's certainly in our sights that full year retail net sales could be CAD 5 billion or even beyond that, as we continue to work through the year. And this variability is what you should expect.
How should we think about your accruing for that? Are you, I guess, for Q1, accruing more on the left-hand side, and then as the year progresses, you'll see the numbers, and then you move more to the... Like, is it gonna be more-
Great, great question. Great question. For Q1, you can think of our accrual being at about the CAD 2.5 billion mark, and as we continue to get closer towards the CAD 5 billion or beyond, we'll be assessing every quarter. But what I wouldn't expect is something like the surprise we had in Q4 2020, where truly it was just remarkable in November and December, and we had to make a significant accrual to reflect the increased sales being put on. This year is just stable, steady growth. We'll be assessing each quarter, and it should be pretty predictable this year.
That's, that's helpful. I was looking for that CAD 2.5 billion number. Okay. Thank you. That's it for me.
Yeah. Welcome.
Our next question comes from Tom MacKinnon of BMO Capital Markets. Please go ahead.
Yeah, thanks very much. Morning, everyone. James, you said in your opening remarks that you were thrilled with the growth that you saw at Wealthsimple. So I guess the question is, if you're thrilled with something, why do you sell it? And then, if the answer is, "Well, that gives us flexibility to invest in, you know, distribution capabilities," then why not look to Wealthsimple? You know, it's had great growth in AUA. So, maybe you can share with us, you know, what you're thinking there was in terms of why you sold down on an investment that you are thrilled with.
Well, we certainly are thrilled with it, and I think anyone in our position would be, would be thrilled to, you know, have the, have the holding in that company that, that we do, Tom. Look at the growth in AUA, look at the growth in clients. I mean, they have proven to be remarkably agile, open-minded about how to compete digitally in financial services in Canada, and they've, I think they've just achieved, an unprecedented, level of success for a company of their type, in this country. So, you know, that's the basis of being thrilled, and of course, the mark on our balance sheet is, I suppose, the ultimate reason to be thrilled, because what was a CAD 187 million investment is now marked prior to the secondary to CAD 1.45 billion.
Look, as you know, so but you, you asked a good question, if you're thrilled, why, why, why sell? And my answer would be prudence. You know, I, it is, it just struck us as prudent to take some money off the table. I spoke earlier to my view that the world is reflating, that there is a high degree of confidence in boardrooms across this country and, frankly, across North America. And I think we could be in for a period here where there is a very, very significant level of M&A opportunity in wealth management and in asset management. And so, you know, the proceeds of that sale after tax, $260 million, we add those to our unallocated capital and our senior debt capacity.
As I said, this gives us dry powder, and it's gonna give us... I don't worry about our ability to deploy capital. I think if our thesis is right, there's gonna be an opportunity to deploy this and do some great things for our shareholders. So we're deeply proud of Wealthsimple. We've taken a little bit of money off the table. We continue to be the largest shareholder. It continues to be controlled by the group. And that overall, Tom, just struck us as kind of the right balance. But yeah, we're thrilled, and we love it.
To what extent has it been, what do you get out of owning it? Is it just strictly a strategic investment, or it's never really been integrated into your platform? I mean, is it just, do you just listen to secrets, you know, as a result of being on the board? And what is, where does this position... Where does Wealthsimple fit long term, and is it just nothing more than a strategic investment? Will it ever be integrated to any extent?
Yeah, that's a good question. I'll tell you how I think of it, Tom. I think about solving for the problem of incumbency. I think about our management team and, you know, being very, very busy day in, day out, focused on the business at hand. What Wealthsimple has done, what Portage has done, what our fintech relationships generally have done, is really helped our management team not just focus on the business at hand, but focus further out to horizon number one, focus further out still to horizon number two. It gives them relationships in the fintech community. It gives them dialogue in the fintech community. It's created very real partnership opportunities, with some of these, investee companies.
And as I said, the problem of incumbency is a very real one, and that is, why do, why do large, older companies, you know, not see what's coming at them? And the best way I think to solve for incumbency is to make sure that you have something like what we have, which keeps our management team very much kind of current and very much on their front feet as they look at how the industry is going to evolve. So that kind of solving for the problem of incumbency is, is one of the things I like most about it. But there's also, you know, a lot of business done. I mean, we, we are a major investor in Conquest Planning, and we're rapidly rolling that out across the IG Wealth. We've had numerous conversations with KOHO.
Barry has done a significant amount of business with, in the past, with Wealthsimple, and I'll let him speak to that in a moment. But it is... I really view this exposure to fintech as really important in just making sure that IGM is on its front feet and competitive. Barry, do you wanna add some thoughts?
If I could, James, thanks. Just to amplify your first point, and I'll speak on the asset management side second. On the first point, you're right. I think we've always viewed Wealthsimple also as attracting investors into the wealth ecosystem earlier. I mean, you've seen hundreds of thousands of new clients of Wealthsimple come into the, arguably the wealth ecosystem of Canada much earlier than they would, or coming in at all, 'cause you wouldn't see the millennials, in particular those in their twenties, to come in and start to save. It's wonderful that they're starting to save every month, and then it's, we don't know the journey they take. At some point, they might need an advisor once they hit a certain point in their career, certain point in life. So we think that that's always an advantage.
On the asset management side, as James pointed out, we, Mackenzie, as you know, we've got our ETF, very proud of our ETF franchises. It's hitting CAD 10 billion probably next week, so it's growing very, very fast. And so we've been increasingly working with Wealthsimple, with a to design ETFs that they need that we can manufacture for them. So there's a really growing synergy, even within IGM, between Wealthsimple and Mackenzie, that we're quite excited about, actually, because, as you know, a lot, lot, lot of their new businesses within Wealthsimple are growing very fast. But that core financial technology platform is also growing 50%+ a year, and so that's another-...
Connection point, Tom, between IGM and Mackenzie within Wealthsimple that you should see some future growth going forward.
Thanks for the color.
Our next question comes from Geoffrey Kwan of RBC Capital Markets. Please go ahead.
Hi, good morning. My first question was maybe just tagging on some of these questions around the fintech investments. And just was curious, I know that you mentioned, you know, stuff like KOHO and Conquest, but within the Portage III private equity fund, are there other investments that you find really interesting, whether or not it's, you know, potentially very significant financial return type opportunity, or also just ones that may eventually become an attractive entity that you would partner with and incorporate into somewhere within the IGM business?
I'll take that one, Jeff.
Oh, sorry. Go ahead, Luke.
Oh, yeah, yeah. I'd say that there's, there's a variety, and I think most of them right now are, are playing on James, James' theme of incumbency. It's those places where you've got a, a management team who's energized and focused on, on a space that, that's, that's really, synergistic to the rest of what happens in IGM. So there's a few of those on, on the mortgage, side of our business and elsewhere that we, we find very exciting. There, there's nothing that's at the, the level of Wealthsimple right now, where, where this is, it's a true success and something that's just got this, you know, clear, clear momentum. But, but I'd say broadly, we're, we're quite excited about the Portage ecosystem. We've just, been a lead, a lead investor in, in fund three.
And as James says, that ecosystem opens a lot of doors for us to sit at tables we wouldn't otherwise be at, and to leverage management teams that are top of their game and really bring capabilities to IGM that we wouldn't otherwise have.
Okay, thanks. Just the other question I had was a bit more just bigger picture was, with respect to, advisors in Canada and kind of the approach to managing client money, is there anything that you would say has kind of changed in the past decade or two with respect to the types of investment products they're choosing for their clients? You know, has things like having, you know, two major market downturns in, I guess, a little over a decade, whether or not it's the regulatory changes that we've seen, kind of getting rolled out over the past decade, has that changed how they manage money and the implications for what that means, for IG Wealth and Mackenzie?
I'll start this, and I'm sure everyone will have some views. But I would say that on the whole, advisors and how they view portfolio construction has changed simply because the amount of risk that you need to assume now to achieve the same type of return has tripled over the last 25 years. And it's forced advisors to really look at their strategic asset allocation first, and making sure that they have the right setup, they have the right asset classes involved in their portfolio construction, and then that they have them at the right percentages based off of what the client wants to achieve.
So from an IG perspective, that's forced us, rightfully so, and I mentioned iProfile during the presentation, so to really look and make sure that strategically we have an asset allocation that makes sense, and that we do look at all the opportunities out there. There are far more tools available to us than there were 10, 20 years ago, and it's incumbent on us looking at public, private, you know, cap bias. You talk about value growth, you can go on and on and on about the opportunities out there. So that's why, you know, we really employ a model solution or a managed solution type of approach at IG.
We take that off the hands of our advisors because that's something that we are good at, and that we allow them to really focus on the relationship and making sure that not only are they offering the best risk-adjusted return for their clients, but they have enough time to really focus on the aspects of financial planning, and investments are only one of the six aspects of financial planning.
You know, if I could add, Damon's spot on, Jeff. You know, going forward, the advisors, to Damon's point, there are more and more tools in the toolkit that they can now access and they have to access, and it points to this whole, you know, democratization of these types of investment strategies that were solely the domain of the sophisticated institutional investors now that are now coming to the advisor and investors, which is really exciting, but actually necessary, too. Because, again, with low interest rate environment going forward, perhaps more muted equity, public equity returns going forward, you need more in the toolkit to put in that portfolio to get the risk-adjusted returns they need. And as Damon was saying, you see the liquid alts are now in Canada, approved three years ago.
Now, the private alts are coming, like us, for instance, with our OMs wrappers, with Northleaf. James mentioned China. China, the equity and fixed income markets weren't really accessible by Canadian investors even a couple years ago. Now they are. We ourselves, Mackenzie, as, as we already filed, are launching, a Chinese, a Chinese fixed income mutual fund in June or July to complement our fast-growing equity, Chinese equity mutual fund. So, it's really take a look at your traditional equity portfolio and extend it, into areas such as China and/or extend your fixed income into, again, other types of EMD and Chinese, fixed income and private credit now.
Extend, you know, James' point reflation or inflationary, not that we're going to time that, but put some building blocks in there, like, infrastructure and REITs and gold and precious metals that are natural inflation hedges. It's a real rethinking of the portfolio construction that we're fortunate enough to help Damon and IG, Mackenzie, to do some of that for them. And, you know, that IG iProfile is just an institutional quality product that's forward-looking as to what advisors need going forward. And that's exactly what we're seeing more and more with Mackenzie in our discussions with advisors. Thank you.
Great. Thanks.
Our next question comes from Graham Ryding of TD Securities. Please go ahead.
Hi, good morning. I just wanted to, you know, touch on the operating leverage this quarter and the lack thereof. Just nice lift in revenue quarter-over-quarter, but essentially, you know, the expense growth fully offset. Should we, you know, be not interpreting this quarter as sort of indicative of the operating leverage within IGM? And is this, you know, big picture, was there some seasonality at play this quarter?
Thanks, Graham. Look, I'll take that one. So, we view there as being a tremendous operating leverage. The best comparison is to Q1 of last year. Earnings are, were up 26% consolidated, and at the component level, they're up very, very strong as well. I would highlight that there is seasonality and significant seasonality in our business and our expenses in particular. Because it's RSP season, we've got amplified promotional and processing expenses every Q1. So any comparison to Q4 is not going to be appropriate in the first quarter because of that seasonality.
We view there as being so much operating leverage, and that's what's led to Mackenzie's earnings being up by, you know, over 40%, from last year, when you exclude the acquisitions as well as strong growth at IG. And that's what you should expect from these businesses going forward. There's a lot of fixed costs. We've given good guidance for the full year, and yeah, up year over year, there's going to be tons of operating leverage going forward. And yeah, Q1 is an odd one, not only because of amplified expenses, but because we have fewer days in the quarter.
and so I talked about the peculiarity between asset-based comp, which is, you know, 1/4 of an annualized rate, relative to our revenues that are 93/65 of an annualized rate. So there's two seasonal headwinds, but yeah, we're so proud of the operating leverage put on, and, and we're so excited about the future.
Okay, understood. Jumping to Northleaf, the contribution from Northleaf was lighter than expected, you know, from my perspective. Just, is this quarter indicative of what we should expect from that asset, or was there something sort of weighing on... I think it was just under CAD 1 million.
You're on a really good point. So it's Luke again. The earnings were a bit light for Northleaf on two fronts. One, the commitments, the new business being put on is very strong. You saw Barry refer to the CAD 1.5 billion in new commitments in the quarter. That's CAD 1.5 billion on a base of CAD 15 billion in AUM. So you can think of that as 10% growth in their business in the quarter alone. The way they earn their money though is most of it generates management fees when the money's invested.
Right now, at this time, they've been slower at putting the money to work than expected, given the market that we're in and where some of the valuations are at. So that did create a lag in the revenue that will be put on as the commitments get put to work. And there was also an accounting true-up of about CAD 1 million that hampered them. That was just again a true-up in the results. So we're sticking consistent with our guidance for the full year of CAD 10 million from Northleaf. And I suggest given the growth they're putting on, you know, this is going to be a very high growth business for us going forward.
Okay, that's helpful. And the CAD 1.5 billion raise was, you know, IGM part of that commitment at all, or was this all third party AUM?
It was substantially third party, and you can think of that 1.5 billion being about CAD 1 billion private equity, none of which would have come from IGM, and CAD 250 million to each of infrastructure and private credit. And so we've made active commitments at IG and Mackenzie, but that's just starting and will come on over time.
Okay. Understood. And then just my last question, a bit of a follow-on, but you talked about, you know, Wealthsimple, and there's some, I guess, Mackenzie ETFs within that distribution channel. Is there anything you can quantify there, like how material is Wealthsimple as a distribution channel for Mackenzie ETFs?
Hi, it's Barry again. Our partnership between Mackenzie and Wealthsimple actually has helped in the past helped them to build Wealthsimple-branded ETFs. And so, there are two ESG ETFs, Wealthsimple-branded, been very, very successful in that channel, given you can imagine with the demographics being mostly millennials. So I believe that's at least over CAD 500 million, if not more, between those two ETFs, maybe more, CAD 600 million-CAD 700 million. And then, they're launching a Sharia-compliant ETF, Wealthsimple, that we manufacture for them. So the discussions are going on with them to a combination. Principally, it's been early days of helping them manufacture Wealthsimple brand ETFs, which essentially us as the manager to back office. They're really Mackenzie, but we brand them Wealthsimple for them.
But also ongoing discussions with them, also with some of our new ETF launches at Mackenzie to use Mackenzie ETFs in their portfolio. So it's a combination of both, and we're actually quite excited by that distribution channel with Wealthsimple between the for the Mackenzie ETFs. Thank you.
That's it for me. Thank you.
Our next question comes from Scott Chan of Canaccord Genuity. Please go ahead.
Good morning. Maybe sticking on that, ESG or sustainable theme, on the retail side, we've obviously seen robust growth and into the quarter into Q1. Barry, is there an opportunity to expand that, you know, that theme into the institutional channel? But I know obviously that's been very hot as well, and it's my understanding, I would think Greenchip or, I guess Mackenzie has an institutional assets within that sustainability funds.
Great question. Absolutely. As you know, the interest and the application of ESG actually began in the institutional marketplace, and now it's coming very strongly to the retail marketplace here in Canada, as well as the United States, as we anticipated, and it's coming very, very strongly. I'd like to speak to that in a moment. On the institutional side, though, yeah, so we've been, you know, Greenchip, we onboarded and they're safely at home at Mackenzie's boutique, and we've been actively now bringing them through our institutional sales opportunities in Canada, U.S., and Europe, and actually in China, surprisingly, where ESG is really taking off. And we have a strong interest in all those regions for Greenchip's environmental equity, global environmental equity product and strategy.
You'll probably hear from us shortly in terms of some of the early successes, but, we've been very, very pleased. That's a real huge door opener when you go to these institutional consultants and directly to these large pension plans of sovereign wealth funds to say we have a world-class environmental equity 14-year history, a successful history in terms of performance, and so that's been building very nicely. And that's why I was mentioning the institutional wins. They're lumpy. You know, they come in, if you all recall, last April in 2020, when retail was a little bumpy in Canada, we brought in over CAD 2.5 billion onboarded institutional wins.
Since then, it's been a little slow, but that pipeline is back up again, and the two leaders for us in the pipeline are Greenchip's environmental equity product, as well as actually our emerging market product, Quant Team, which has outperformed the index the last year over 1,000 basis points. So, you know, where we lean in where we need to, and, there's been really strong interest there. Now that you've asked about sustainability, this is really a game changer for the industry in Canada, another game changer. There is remarkable interest in sustainability. As we know, capital redeployed in this area, tens of trillions of dollars over the coming decades. And so we've got the, you know, we launched the Greenchip Balanced, we launched a sustainable bond fund.
We have, that was the first balanced environmental themed, and as I mentioned in my comments, we hired one of the pioneers of ESG SRI investing in Canada, Andrew Simpson, and you'll see his team and products being launched, over the next couple of quarters. So, collectively, we're, we're working real hard in that area. It's important, to us as a business, but it's important for the, the climate and the world that we get this right. And so we, we, we're, we're really embracing this hard and get in front of it, as I think we did a couple of years ago, for the advisors who want to continue to be in front of it. Thank you.
Thanks. And maybe just on GLC, you know, that recently closed. Is there any notable updates, you know, with that transaction, since you closed it?
Great question. So, yeah, early days, but really continue to be really excited and pleased. First of all, super teams that we brought in terms of adding to our investment talent across a lot of our boutiques, and then, and as I mentioned, standing up a separate, large, separate Canadian equity boutique that has institutional quality, and at early days, we're having good discussions of Canadian institutional investors with that boutique. And then, of course, probably the other two principal advantages of the GLC Asset Management acquisition, A, was the fact that we, Mackenzie now are gainfully working closer with Canada Life wealth business in Canada, which is growing very nicely, that we can again look for ways that we can grow that with new ideas and products.
That is early days going very well in terms of the dialogue and the planning. And then the group retirement marketplace, which is a growing marketplace in Canada, as we know, and Mackenzie had de minimis exposure there prior to GLC, and now, I would, I would say that the reception has been very positive.
Institutional consultants are the intermediaries for a lot of those clients, but they've been fine with the transaction and a little bit of a wait and see for a couple of quarters, but that's gone very well, and we probably should be proactive in that channel over the coming quarters, once, you know, everything has been settled down in terms of the changes to the organization that the investment consultants saw, and now they're fine with it. So, all green lights right now for us to get going on those two new channels. And again, very happy with the teams coming in and the new investment professionals. They're just, just a terrific team, and they fit very nicely culturally into Mackenzie.
Great. Thank you very much.
You're welcome.
Once again, if you have a question, please press star, then one. Our next question comes from Jaeme Gloyn of National Bank Financial. Please go ahead.
Yeah, thanks, and good morning. My question is on the high net worth segment and mass affluent segment, and the disclosures around the iProfile Managed Solutions. It looks like really solid performance there. Is there anything you can tell us about the growth in that iProfile Solutions product? What's the uptake from high net worth and mass affluent clients in terms of the growth sales that they're generating? And what are you expecting out of this product going forward?
Yeah, so the growth statement, by the way, the growth in the iProfile product has been substantial over the last three or four years. Our approach at IG is to really embrace well-constructed managed solutions. So we have over 80% of our flows directed there. We foresee that continuing. For the mass affluent and high net worth segment, iProfile, which is really a makeup of three different types of solutions. There's the iProfile pools, there's the iProfile portfolios, and then there's the new discretionary iProfile models. The most money is in the pools, well over CAD 20 billion.
The portfolio started last year, and we just we're approaching CAD 2 billion in those. And then the discretionary model portfolios, as I said, just started. So we expect that to continue to grow. We, you know, we fully have made sure that we've designed these things to be very receptive to those types of markets that we want to make sure that we grow our percentages in.
Great. And is it new clients coming to the IG platform that are driving that growth, or is it existing clients shifting some of their money from other funds under the iProfile?
It's actually both. So we've done a great job of working with our existing clients in making sure that they're aware of the benefits of leveraging iProfile. And it's one of the reasons why we've got, we're very excited about our increasing share of wallet with our existing clients. But it's also been a huge driver of our ability to bring in new clients to the organization. So both share of wallet, new client acquisition have been key for us, and they will continue to be key for us going forward. And then it's helped us bring in new advisors, advisors that are experienced in the industry that want to focus on financial planning and want to rely on well-constructed managed solutions to join our firm as well.
Yeah, that's great. Shifting to the comments around China and the attractiveness there, and recycling some of the capital from Wealthsimple. Is the view right now that the most attractive option is the one you have with ChinaAMC, or are there other opportunities in China that we could see that capital get recycled and deployed into?
Yeah, I would—I appreciate the question, but I would say we have not landed on what the optimal deployment of this dry powder is. But I mean, ChinaAMC, as I said, is an asset we very much like and would be open-minded to owning more of. But I think, as I said earlier, I think as the world reflates and confidence in boardrooms builds and builds, we're gonna see a very active M&A environment generally, and I expect a lot of wealth platforms and asset management platforms to potentially become available. So we are very open-minded as to how this capital will get deployed.
Okay, great. And then, last one is just maybe more of a you know macro view. Industry as a whole is obviously doing very well from a net flow perspective, and I think there's some underlying macro currents that are helping to drive that. But you know, what are your overall views on the sustainability of this record industry net flows, you know, at least over the near term?
It's Barry. Great question. So certainly we're seeing record flows in the industry, and that's a good thing, obviously, for all of us, and particularly IGM as we gain market share. It's... We think this can go on for a little while now. I mean, this can't go on forever, as trees can't grow the sky, as they say. But if you see, to your point, the macro forces, first off, interest rates, all the central banks are signaling, particularly in Canada, United States, and Europe and elsewhere, interest rates will be low for quite a while, at least for a couple of years. And the central banks, as we know, are really focused on that economic recovery and jobs and employment, probably more so than they ever have.
They're going to be a little more accommodative, or patient rather, to raising rates until they see those signals come back. Even to James' point, even reflation, as you know, the central banks have changed their posture on inflation, not so much a target, but also more of an average. So as inflation does kick up transitory-wise above those targets, they'll again be patient with it because, you know, just to ensure that economic recovery is there and the jobs are there. So interest rates remaining low. The equity markets, of course, been bolstered by macro forces with fiscal stimulus, but also, obviously, there's a broader way of companies that are thriving in this environment.
Some industries are still not, and that's unfortunate, and as some folks are so disadvantaged with this in COVID environment. But, an increasing amount of companies are thriving, and so the corporate earnings, as you've probably seen coming in, are strong. And there's no reason why you've seen some of the large financial institutions in Canada and United States point to the fact this might go on for a few years going forward. So when you have that environment, plus obviously, you know, the average citizen being a little more careful with their spending and therefore that money going into savings, that is a fertile environment for wealth and asset management industries.
And so we're not gonna put you know a point of prediction as to when that might subside, but it's not a one quarter phenomenon. This could go on for quite some time. So, we're here very focused, all of us, just to take advantage of it, gain market share in a growing market. That's a nice combination. But first and foremost, obviously, just focus on providing great advice and great returns for our clients. But great question. Don't have a crystal ball, but it's certainly a robust environment right now for the industry.
Thank you very much.
This concludes the question and answer session. I would like to turn the conference back over to Mr. Potter for any closing remarks.
Yeah, thank you, everyone, for joining the call today. We certainly appreciate the broad set of engaging questions. And, with that, I hope you all have a good weekend, and we'll end the call. Thank you.
This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.