Ladies and gentlemen, thank you for standing by, and welcome to the Prudential Quarterly Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. Also, as a reminder, this teleconference is being recorded. And at this time, I'll turn the conference over to your host, head of Investor Relations, Mr. Mark Finkelstein. Please go ahead, sir.

Thank you, Tony. Good morning, and thank you for joining our call. Representing Prudential on today's call are John Strangfeld, CEO; Mark Grier, Vice Chairman; Charlie Lowrey, Head of International Businesses; Steve Pelletier, Head of Domestic Businesses; Rob Falzon, Chief Financial Officer; and Rob Axel, Controller and Principal Accounting Officer. We will start with prepared comments by John, Mark and Rob, and then we will answer your questions. Today's presentation may include forward-looking statements. It is possible that actual results may differ materially from the predictions we make today. In addition, this presentation may include references to non-GAAP measures. For a reconciliation of such measures to the comparable GAAP measures and a discussion of factors that could cause actual results to differ materially from those in the forward-looking statements, please see the section titled forward-looking statements and non-GAAP measure of our earnings press release, which can be found on our website at www.investor.prudential.com. John, I'll hand it over to you.

Thank you, Mark. Good morning, everyone, and thank you for joining us. Overall, we delivered solid earnings for the third quarter and we continue to see momentum across our domestic and international businesses. We benefit from a differentiated set of high-quality businesses that fit well together. The balance of our businesses and risks enables us to produce strong overall earnings and also helps weather the normal variability that can occur across segments in any given quarter. Operating earnings per share for the quarter of $2.51 excluding market-driven and discrete items was consistent with our internal expectations and the $2.52 that we produced in the third quarter of 2015. Our annualized return on equity through nine months was healthy at about 13%. And book value per share excluding AOCI and foreign currency re-measurement grew 9% over the prior year. While our overall results were solid and we saw good core growth across many of our businesses, there were a number of factors that influenced the quarter. On the positive side, we reported strong investment results, benefiting from non-coupon investment returns that exceeded our average expectations. While results in this asset class do show variability, we are pleased to see the bounce back in returns following weaker results in the first half of the year. Our annuities business also benefited from a more efficient approach to managing risk, that positively impacted margins, which should have an element of sustainability going forward. On the other hand, our overall underwriting experience was less favorable than our average expectations and this can fluctuate on a quarterly basis. In addition, expenses were elevated in the quarter. Mark will discuss this in more detail, but we experienced a higher than usual level of charges and expenses of items that are inherently variable. I'll now make some high-level…

Thanks, John. Good morning, good afternoon or good evening. Thank you for joining our call today. Special thanks to those of you in Chicago who are participating in our earlier than usual call this morning. I'll take you through our results and then I'll turn it over to Rob Falzon, who will cover liquidity, leverage and capital highlights, and I'll start on slide 2. After-tax adjusted operating income amounted to $2.66 per share for the quarter compared to $2.40 a year ago. Core performance of our businesses remained solid in the quarter, with results benefiting from higher fees in our asset management and annuities businesses and continued business growth and International Insurance on a constant currency basis. After adjusting for market-driven and discrete items, earnings-per-share was essentially flat compared to a year ago, as the year-over-year comparison was affected by fluctuations and a few inherently variable items. I'll mention a few highlights. First, higher current quarter net expenses within our Corporate and Other results and in several businesses, largely driven by higher than typical charges for items such as employee benefit and compensation plans and legal costs. Second, less favorable underwriting experience compared to a contribution more favorable than our average expectations a year ago. And third, more favorable net investment results with current quarter earnings from non-coupon investments and prepayment fees above our average expectation. The items I mentioned together with less favorable currency exchange rates had a negative impact of roughly $0.30 per share on the comparison of our results to a year ago. The net impact of current quarter variances in comparison to our average expectation contributed about $0.05 per-share to earnings related to favorable non-coupon investment income, prepayment fees and net adverse claims experience across businesses together with reserve refinements and higher than typical legal costs…

Thanks, Mark. I'm going to provide an update on key balance sheet items, financial measures and other related areas of interest starting on slide 17. Following the recapture of living benefit risks from our reinsurance captive earlier this year, most of the economics and risks of our variable annuity contracts and the supporting capital are now resident in a single statutory entity we call PALAC, which was a direct writer of many of the contracts. As a result, we now view composite RBC including our U.S. insurance entities on a comprehensive basis as a primary measure of our financial strength in relation to our benchmarks. On that basis, composite RBC at year-end 2015 was 486%, and we estimate that it is well above our 400% target at the end of the third quarter. In Japan, Prudential of Japan and Gibraltar Life reported strong solvency margins of 840% and 987%, respectively, as of June 30. These solvency margins are comfortably above our targets. I'll turn now to an update on the risk management refinements we implemented during the third quarter as part of the strategy to manage all our annuities product risks together within the annuities business. We continue to manage these risks on an economic basis, including the ability to maintain a CTE 97 threshold through moderate stress scenarios. With the current structure, we are now managing the risks with a combination of traditional fixed income investments and derivatives held within our statutory entities. These strategy refinements are beginning to produce earnings benefits, as Mark mentioned, and are simplifying our annuities operation, reducing our capital volatility and increasing the certainty of cash flows from the business. Looking at the liquidity, leverage and capital deployment highlights on slide 18. Cash and liquid assets at the parent company amounted to $3.5 billion at the end of the quarter, a decrease of about $500 million from June 30. This reflects the impact of the return of about $930 million to shareholders, including dividends and $625 million of share repurchases net of cash inflows during the quarter. Our financial and total leverage ratios at September 30 remained within our targets. As we mentioned in our second quarter earnings call, we expect to move the evaluation of our dividend level to the first quarter of 2017 in order to get better aligned with our capital planning cycle. And with that, I'll turn it back over to John.

Thank you, Rob. Thank you, Mark. We'd like to open it up.

Thank you very much. Our first question will come from Jimmy Bhullar with JPMorgan. Please go ahead.

Hi. Good morning. I had a couple of questions. First, if you could discuss the earnings benefit that you're talking about in the annuity business as a result of the captive recapture. What's really driving that? And to what extent can you quantify the ongoing benefit? And then secondly, you mentioned case experience being negative in parts of your retirement business. If you could give us a little bit more detail on which product line you've seen that in and how has the aggregate experience in that product line been over time.

So, Jimmy, it's Rob. I'll take the first of those questions, then I'll turn it over to Steve to take the second. And actually in talking about the annuities piece, it's a good story, so I'm going to actually spend a minute on it, if you don't mind. So recall that we completed this in three phases, the first at the end of last year where we got regulatory approval for the statutory framework that we were undertaking. The second phase completed in the second quarter, where we actually recaptured the living benefit rider. And then what you've seen in this quarter is that we migrated over to our new risk management strategy, and that strategy is what gave rise to the earnings enhancement that you asked about. The outcomes of those three phases have been that, first, we reorganized and simplified the legal entity structure that supports our annuities business. We're managing all the risks associated with that business within the annuities legal entities now, meaning that the internal corporate under hedge, which was a prior contributor to earnings capital and leverage volatility, is no longer in existence. And we're using a more stable statutory framework that reflects the long-term nature of the risks. And we've talked about that before. And as I noted in my remarks, we're using a combination of derivatives and financial assets to fully diffuse (30:34) that liability. The immediate results that you've seen have been a reduced capital sensitivity to market movements. You saw that particularly in the first and second quarters. A release of about $1 billion, which we talked about last quarter. That was the basis for the $0.5 billion increase in the share repurchases that were authorized, a portion of which we executed on during the course of this quarter. And those lower risks that gave rise to that release in capital are leading to lower costs actually than manage the risks. So that resulted in an increase in AOI, about $15 million in the quarter, but we think the run rate number is more like about $20 million. And it also incidentally gave rise to what you saw outside of AOI in the positive DAC unlocking that increased net income for the quarter as well.

And the $20 million is a quarterly number going forward?

Yes, it is, Jimmy.

Okay.

Jimmy, it's Steve. I'll address the rest of your question. First of all, on annuities and the ROA. As Mark mentioned, 114 basis points is certainly driven in part by some favorable non-recurring items and some investment lift this quarter. However, the risk management strategy, as Rob just mentioned, it does create some sustainable run rate benefit. Mark mentioned it added about 4 basis points to 5 basis points. So while we'd still say that the average expectation for ROA in this business is between 100 basis points and 105 basis points, it would be fair to say that the new risk management strategy creates some degree of bias towards the upper part of that range. In regard to what you asked about, the retirement and the case experience. As Mark mentioned, that was adverse by about $20 million. However, half of that relates to reserve strengthening on a legacy block of business, GIC. If you look at the pension risk transfer business itself, case experience was very modestly below average expectations in this quarter. But the same cases that result in modest adverse experience this quarter have been cumulatively $100 million positive over the last seven quarters. So results are going to move around a little bit quarter to quarter, but all evidence continues to be that this is a very solid and very well-priced book of business.

Thank you.

Thank you. Our next question in queue will come from John Nadel with Credit Suisse. Please go ahead. John M. Nadel - Credit Suisse Securities (USA) LLC (Broker): Hi. Good morning, everybody. I guess the first one is I just wanted to discuss expenses. Mark, I appreciate your commentary that the fourth quarter tends to see some elevated levels, seasonally and otherwise. But it seems that 3Q results also exhibited some elevated expense levels. How should we think about the expense levels the first nine months of the year so that we can compare the average increase that we typically see in the fourth quarter?

So, John, it's Rob. John M. Nadel - Credit Suisse Securities (USA) LLC (Broker): Hi, Rob.

Let me start with the end question and then maybe I'll tack back to just some further reflections on that. From a seasonality standpoint, we think that the range that we've provided of, call it the $125 million to $175 million in the fourth quarter relative to the average of all four quarters is a trend that will persist. And so we expect to see that this year as well. You saw it in the fourth quarter of 2014. It was at the lower end of that range. And in the fourth quarter of 2015, it was the upper end of that range. Now we think about that against what we think of as sort of the adjusted level of expenses. And so in Mark's opening comments, he called out the $90 million of higher than what we would consider to be – or nonlinear elevated expenses relative to what we would consider to be more normal. About half that was in the businesses, and we called out some of the causes of that. The other half of it was in Corporate and Other, and we also identified the causes there. If you look the higher level of expenses and you look at our Corporate and Other, a lot of it is attributable to that. We're at an unusually high-level this quarter. And, so, if you kind of reflect on a more adjusted level for that, think about last quarter, we had one or two one-time charges that we adjusted for. We had an equity method of investment that we wrote down, and we had some costs associated with the tender offer we tendered for about $0.5 billion worth of debt. That brought that adjusted number down to $335 million last quarter. If you look at the trailing four quarters, so not quite the question you asked about sort of year to date. But if you look at this quarter and go back three, the average for those four quarters is around $350 million on an adjusted basis using what we've called out this quarter and last quarter. So I would think about that as sort as being indicative of a more normalized number, more – kind of a – more of an adjusted number that we would more typically see. And that gives you a sense for then what you would extrapolate against looking into the fourth quarter for measuring the variance against the first three. John M. Nadel - Credit Suisse Securities (USA) LLC (Broker): Okay. That's all really helpful. I wanted to make sure that we should or shouldn't adjust for some of these items that you guys have called out. Okay. The second question, I know it's relatively small, but just added to your portfolio of businesses, and so I'm curious what your thoughts are with protest actions underway and the potential for some pretty significant reform around the Chilean pension system and how that maybe influences your view of AFP Habitat.

Sure. It's Charlie, John. There have been some continuing albeit smaller demonstrations in Chile around a couple of issues. There's a new issue involved as well. But the first issue revolves around the fact that people perceive their pensions to be low. And to solve this issue, Chile must go back to a defined benefit system. In other words, they'd like the government to fund higher pensions and to guarantee those pensions. So that's the first issue. The second issue that has arisen resolves around the push back on the investment structure used by a couple of foreign companies in their AFP purchases. So with regard to the first issue, the government has said they have no money to fund pensions, but they have suggested that corporations pay an additional 5% into the pension system. And President Bachelet has also suggested perhaps creating a government AFP in addition to the existing AFPs. So with regard to this issue, the situation remains fluid and probably will stay that way for some time as the government sorts out what they'll do. And we think that's going to be in the first half of next year. But there are some suggestions on the table, and we'll see what happens. In terms of Habitat, I'd like to make a couple of observations. First, it's the number two pension administrator with about a 26% market share. But we think that there are four key attributes of the company that are really important. First is that it focuses relentlessly on costs. In fact it's the most efficient AFP and has the lowest fee of any of the four largest players, and that's really important given the context of what's going on. Secondly, this has exceptional fund performance both on a relative and an absolute basis, and that's also really important as people focus on what they're getting for their investments. Third, they have very high quality service; and forth, they're a leading player in the voluntary pension products. In terms of the second issue, we acquired the company with a different structure than others, not amortizing any of the intangibles. And you may recall that it took an awfully long time to gain regulatory approval, in large part due to frankly, welcome scrutiny of our structure to make sure it met all the regulatory requirements. So from our point of view, we wanted to make sure that the agreement not only met the letter but the spirit of the law, and that's why we welcome the regulatory scrutiny in order to make sure that the regulators were very comfortable with the structure that we had. So we're monitoring the situation closely but feel as a company, Habitat is in a really good position within the industry. John M. Nadel - Credit Suisse Securities (USA) LLC (Broker): That's really helpful. Thank you, Charlie.

Thank you. Our next question in queue will be coming from Ryan Krueger with KBW. Please go ahead. Ryan Krueger - Keefe, Bruyette & Woods, Inc.: Hey. Thanks. Good morning. It seems like we started to see some pickup in pension risk transfer activity again. I was hoping for an update there. And I guess are plan sponsors starting to accept the low interest rate environment and kind of be more willing to transact again?

Ryan, it's Steve. Thanks for your question. The low rate environment status – the low rate environment does lower funding status in the aggregate. But as I've mentioned before – and your question reflects this. It's not so much about how rates are today but how rates are today in relation to where plan sponsors expect them to be in the future. And I think there is some degree of acceptance of lower rates for a longer period of time and then readiness to address pension risk. We still see a very robust pipeline. That pipeline is largely populated by plan sponsors who, over the past few years, have taken steps to mitigate their exposure to low rates through liability driven investing including in some cases, doing that LDI with us. So we still see a solid pipeline before us. Ryan Krueger - Keefe, Bruyette & Woods, Inc.: Thanks. And then the tax rate has trended down this year to about 23.5% year-to-date. Do you view that as a sustainable tax rate going forward?

Ryan, it's Rob. Yes. Our estimate for our full-year effective tax rate for the year is right about that number, 23.5%. Ryan Krueger - Keefe, Bruyette & Woods, Inc.: Thank you.

Thank you. Our next question in queue will come from Tom Gallagher with Evercore ISI. Please go ahead.

Good morning. Hey, Rob, I had a question on RBC, considering the impact of the captive recapture. The PALAC 550%, is that a pro forma estimate of RBC, considering the captive or is that before the recapture would have occurred?

It's the latter, Tom. So that is simply the separation of the businesses between the two legal entities but then does not reflect the additional steps that we took subsequent to that. So that is not reflective of what we think the RBC will be for PALAC when you look towards year-end.

And am I thinking about it correctly in that there should be a substantial increase in reported RBC from, whether it's pro forma or we're just talking about the likely impact at year-end. Are we going to see a doubling in the RBC or something directionally that high? I just want to get a sense for – to where that's likely to trend, and I don't need a precise answer but just directionally. And then a related question, is 400% still the right RBC target considering I think you have another measure of CTE that might supersede the way you're evaluating capital adequacy post recapture?

So good questions, Tom. So on the first – the latter part of it, yeah. When we think about that annuity as a legal entity, we really think about it as the way in which we manage it economically and we've articulated in the context of the CTE 97. Importantly, I always footnote that with the CTE 97 through moderately stressed scenarios. So it's to maintain that even in more adverse circumstances than we face today. When you manage that way, the actual RBC calculation can get kind of funny on you. So, yes, you could see something like in the order of magnitude of what you described in terms of the impact of our RBC within PALAC and the 400%, therefore, becomes a much less meaningful number to evaluate it against. And it's much better to think about it in the context of where we are against that CTE 97. Back at PICA, which is sort of once you've split PALAC out; we still believe that the 400% is the appropriate way to be looking at the PICA legal entity.

Okay. That's helpful. And then just a follow up on the higher estimated gross profits and variable annuities, spending less on hedging, can you simplify this bid for us? What's happening here that's resulting in higher estimated gross profits, really? Presumably you're buying less of something from a hedge standpoint, willing to take more risk, or just altering the way you hedge; is it that you're buying more bonds that are income producing? Can you provide just a little bit more color as to what's going on behind the scenes on the way you're hedging here?

Yes. So, Tom, I'd highlight the following couple of things; first, when we took the rider and we put it together back with the host, you have a decrease in risk by virtue of doing that because you have offsetting risks that you now are able to manage within the same legal entity. So if you think about our economic liability, it has actually declined by almost $1 billion by virtue of having been able to pull those two entities together. So that's your hedging less risk piece of it, because you have got less risk manifesting as a result of the combination of those two entities. The other part of it is that the way in which we're hedging is a good combination of financial instruments, fixed income instruments, and derivatives is a more efficient way for us to hedge. So the very point that you made, where we are using derivatives, I don't want to get overly technical on this, but you're using the swap curve, swap curve is negative to Treasurys. When you're using fixed income instruments, we are actually getting the full benefit of the yield associated with Treasurys; we're buying a lot of Treasurys for that liability. You're actually getting a better yield on that. So it's a combination of we have less risk and therefore need to hedge less and we're using a hedge strategy, which is more efficient and the combination of those two things results in lower costs to manage the risk. That means we have higher estimated gross profits in the future.

Okay. Thanks.

Thank you. The next question comes from Yaron Kinar with Deutsche Bank. Please go ahead.

Good morning. I actually had one follow-up on the variable annuity capital structure. Just given the Oliver Wyman recommendations that came out this summer, I was curious if you could maybe try to quantify or give us some idea as to what the impact would be if you had managed a CTE 98, both in terms of RBC or maybe actual dollar standpoint.

Yaron, so a couple things. First, let me say more broadly that the terms of our recapture are entirely consistent with the recommendations coming through the OW paper that was prepared for the NAIC. And that is what we anticipated. We went through it and obviously we've been very engaged with our regulators and with the NAIC and OW. With respect to the specific thing that you've identified, the CTE 98, recall that, as I said earlier, we're holding CTE 97 through stressed scenarios. Therefore, we don't view that it's likely that there will be any issue for us with regard to the level of capital that we're holding vis-à-vis a CTE 98 standard.

Okay. Got it. That's helpful. And then this is probably for John, you referenced the comments you made with regard to the Fed's proposal for capital requirements and now liquidity standards. And I think you said you're encouraged by the Fed's view or willingness to maybe make some changes with regards to the insurance business model. But I think in the comments that PRU made, there were also some concerns that were raised regarding the current framework. And if the Fed is less willing to move in the direction of an insurance model, how do you see your capital requirements or adequacy in that situation?

Well, it's Mark. I guess there are two parts to this. You mentioned the liquidity question and then the capital question. And on liquidity, the issues that we've raised have been around both measurement and reporting with respect to liquidity. And it's too early and I wouldn't want to either anticipate or speak for the Fed, but we think we've made construction recommendations that will be carefully considered. With respect to the capital framework, I think the tone of everything, both orally and in writing, has been very much in the direction of trying to get it right for insurance companies, whether in the context of more of a bottoms-up statutory-based framework, which is reflected in the building block approach, or the items that we expect will be appropriately considered in the GAAP-driven consolidated approach. So I think you have to separate the capital question into two parts. One is the framework and the way in which that works and particularly how it deals with things like marking to market either side of the balance sheet and how that's done, things like margins and reserves, things like separate accounts. So there's a list of framework issues. And then separate from that, there's the question of calibration. And you've heard part of our story around variable annuities and how well protected we are between reserves and capital. And you can extrapolate many of those themes to the entire company, and that's kind of what's behind my chronic comment that we believe that we should be able to meet any reasonable capital standards that are set. So working through the framework, I would say that the tone of everything is very much in the direction of being appropriate for insurance. With respect to calibration, it remains to be seen, but, again, we are extraordinarily strong considering the overall loss absorption capacity of the company.

Thank you.

Thank you. Our next question will come from Humphrey Lee with Dowling and Partners. Please go ahead. Humphrey Hung Fai Lee - Dowling & Partners Securities LLC: Good morning and thank you for taking my questions. Just a follow-up question related to the deferred compensation and the higher expenses in corporate. Can you size the impact for the quarter, specifically for the deferred comp in both corporate and Gibraltar?

Humphrey, it's Rob. Actually, I think we're going to defer on that. I don't think we want to provide that granular a level of visibility into it. There are number of things that go into that. We identified the things that would account for the larger portion of the amount that we provided to you. But since the topic has come up again, let me just take maybe an extra minute on expenses, because I know it's – given that it's been raised twice, it's an area of interest. As a firm, we pay a lot of attention to costs. We've been really disciplined about growing our costs over time. If you look back over the last couple of years, what you would see is that our expenses, excluding the initiatives that we've undertaken, actually since 2013 have only grown around 1%. If you include the initiatives in there, then they've grown at only around 3%. And that compares to our AOI growth that's been in excess of 4%. So we've been very disciplined about costs and, therefore, you haven't seen us having to do large cutbacks in our cost structure as a result of being controlled in the way that we've grown it to begin with. Now having said that, we've also been very strategic in how and where we've chosen to invest our expense dollars. And those are the initiatives that we repeatedly referred to. It's very similar, frankly, to the approach that we took coming through the crisis. It was measured, thoughtful and disciplined. But when we see an opportunity to invest and position ourselves ahead of competition, who are cutting back or going in a different direction, we're going to invest for the future and do that. So if you look at the initiative spending that also gives some basis for the rise in overall expenses that we have, we expect that it will generate long-term sustainable top and bottom-line growth for the company. And you can see some of the benefits of that already manifesting themselves. The total gross level of initiative spending is actually much larger than what you see coming through because we're using savings that we're able to harvest from some of our earlier initiatives to pay for some of the initiatives that we're undertaking now. And you're also seeing some of the investments we've made in places like distribution paying off in the form of very strong, for instance, flows in our asset management business. So we're very focused on our costs, controlled in that, being very strategic about where we're investing. And maybe what I'll ask is actually pivot it over to Steve and ask if he wants to elaborate at all on some of that initiative spending and how it's actually affecting the businesses.

Sure. Thanks, Rob. As Rob mentioned, we're making investments both across our businesses in such areas as our digital properties and data analytics and also within our businesses. And the investments made within our businesses are already starting to pay off. Mark mentioned this in his comments as well. In asset management, we see some of our investments in distribution resulting in significant institutional flows over the past several quarters. In retail asset management, we see our investment in product paying off. In retirement, we see our investment in our business platform paying off in terms of improved sales and improved persistency. And as Rob mentioned, we've been able to largely mitigate the cost of these investments through continued effective management of, if you will, the day-to-day operating costs of our business platforms. So it's a situation where we are both able to invest in the future and deliver solid results today. Humphrey Hung Fai Lee - Dowling & Partners Securities LLC: Thank you for the color. And maybe shifting gears a little bit; for Group Insurance, sales declined by double digits year-over-year. There is some commentary about the pricing in the marketplace getting a little bit irrational, so maybe you can share some of your observations in the marketplace in terms of competition and pricing?

Humphrey, it's Steve. Third quarter results in group sales don't tend to be really all that meaningful. As you're aware, the significant quarter for group sales is the first quarter. But I would say, generally speaking, we see this continuing to be a competitive marketplace, and we have been able to be more competitive in the marketplace while still maintaining a very well controlled sales and well-priced sales. We've been able to be more effective through rigorous expense management and through development of a very strong value proposition in the business. So we're confident in our ability to win new business, but we will do it at the right kind of price and on a well-controlled basis. Humphrey Hung Fai Lee - Dowling & Partners Securities LLC: Thank you for the comment.

Tony, we have time for one more question.

Thank you. That will come from Michael Kovac with Goldman Sachs. Please go ahead. Michael Kovac - Goldman Sachs & Co.: Great. Thanks for taking the question. I wanted to follow up on the cash flow as it relates to the variable annuity recapture. Understanding that we freed up about $1 billion of cash here on sort of a one-time basis, but with the more stable cash flow over time, it sounds like you committed to the 60% cash flow to operating income as sort of still a run rate. Can you give us a sense as to why or why not, why this wouldn't change going forward given the more stable cash flows out of the VA business?

Yes, Michael. So we look at that ratio holistically across the company as opposed to any given business. There are certain businesses which will the above that ratio and other businesses that will be below that ratio. And that's really – I like to describe it as an input, not an output, and the reason for that is we have a very high ROE as a company. And therefore we have opportunities within our businesses to reinvest our free cash flow back into those businesses at those high returns in order to generate growth and returns that are in excess of our cost of capital. So from our standpoint we try to balance the level of reinvestment we are making into our businesses to target where we are producing, where we have the opportunities to grow and where those opportunities grow at sustained high ROEs. And so we could push that cash flow ratio up quite easily, but we would then starve our businesses in the form of organic growth. We think that would have a negative impact on our ROE in the long term and in our market positioning. On the other hand, we can drive it down much lower, but that would then cause us to be investing in things that would have, on the margin, lower ROEs. So it's a balance for us and a targeted number and we are very comfortable with that 60% on a go-forward basis. Michael Kovac - Goldman Sachs & Co.: That's helpful. And if I could, one follow up, on organic growth. Saw it come through across a couple of segments, I kind of wanted to focus on the asset management, investment management segment. One, could you give us an update on what you're seeing from a competitive landscape? And we did see kind of earlier this month that the PGIM along with some others lowered fees on several products, so sort of your thoughts there in terms of those moves and the competitive outlook for organic growth going forward?

Michael, this is Steve. We do see across the industry that there has been some pressure on fees that goes across active and passive strategies for the past few years. The DOL rule will continue to support and possibly accelerate that trend. We still see ourselves as being very, very competitive in that context. While we see different types of flows in different parts of the business, certainly in our equities business, we've not been immune from the shift from active to passive. We've seen that in our equity business, particularly in the traditional U.S. style box strategies. However, we're responding to that through investing in our growth in areas within equities that have shown greater resilience in that active to passive trend; global, international, income oriented and factor-based investing in our quantitative management business. And then also the very nature of the multi-manager business itself. Even as we see some degree of outflows in equity like other active managers, we've seen very robust positive flows in fixed income and real estate and strong origination levels in privates and mortgages. We've had those positive institutional flows for 13 straight years, and that gives us confidence in our prospects. I'd also mention that if you relate kind of equities to fixed income, certainly, equity strategies by and large have a higher fee basis than fixed income. But because of the high margins and the particularly attractive scale economies in our fixed income business, we only need somewhat less than $1.50 of positive fixed income flows to offset the impact of $1 of negative equity flows, despite the lower fees that might be pertinent to fixed income business. So between the multi-manager strategy and our competitiveness across different asset classes, we feel ourselves very well prepared to compete, even as we do see some secular (59:58) downward on fees. Michael Kovac - Goldman Sachs & Co.: Thanks. That's helpful.

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