Welcome to the Fourth Quarter and Full Year 2014 Earnings Conference Call. My name is Lorraine, and I will be your operator for today's call. [Operator Instructions] Please note that this conference is being recorded. I will now turn the call over to Ms. Alicia Charity. Ms. Charity, you may begin.

Thank you, and good morning. Welcome to Ameriprise Financial's Fourth Quarter Earnings Call. On the call with me today are Jim Cracchiolo, Chairman and CEO; and Walter Berman, Chief Financial Officer. Following their remarks, we'll be happy to take your questions. During the call, you will hear references to various non-GAAP financial measures, which we believe provide insights into the company's operations. Reconciliation of the non-GAAP numbers to the respective GAAP numbers can be found in today's materials available on our website. Some statements that we make on this call may be forward-looking, reflecting management's expectations about future events and operating plans and performance. These forward-looking statements speak only as of today's date and involve a number of risks and uncertainties. A sample list of factors and risks that could cause actual results to be materially different from forward-looking statements can be found in today's earnings release, our 2013 annual report to shareholders and our 2013 10-K report. We take no obligation to update publicly or revise these forward-looking statements. And with that, I'll turn it over to Jim.

Good morning, and thank you for joining us for today's earnings call. I'll spend my time discussing what I'm seeing in the business. Walter will talk to the numbers, and then we'll be happy to take your questions. In terms of the quarter and 2014 overall, I feel good about Ameriprise and our position. The fourth quarter we delivered was a continuation of a strong year. We're executing our strategy well and generating good results. For the fourth quarter, operating net revenues continued to grow, up 5% with good growth in operating earnings, up 16%, and operating earnings per diluted share, up a very strong 23%. For the full year 2014, operating net revenues grew 7% with good movement in operating earnings of 14% and operating EPS, up a very strong 21%. We also had solid growth in assets under management and administration, which increased 5% to $806 billion. This was driven by continued good advisor/client flows and market appreciation. Our strong growth in earnings allows us to generate significant free cash, so we're able to consistently deliver differentiated shareholder return while maintaining our financial strength, all while investing in the business. In the fourth quarter, we returned $444 million to shareholders. And for the full year, we returned $1.8 billion to shareholders, which is 109% of our operating earnings. In fact, 2014 marked 4 consecutive years that we have returned more than 100% of our operating earnings to shareholders. We expect to continue to return strongly to shareholders and have targeted a 90% to 100% range annually, and we will evaluate based on circumstances. With strong business results and significant capital return, operating return on equity reached another high. Excluding AOCI, we ended the year at 23%, up from 19.7% at the end of 2013. Very few financial services…

Thank you, Jim. Ameriprise delivered strong results at the aggregate level in the fourth quarter, with solid underlying performance in our Advice & Wealth Management, Asset Management, Annuities and Life and Health businesses. We had double-digit growth in earnings and EPS in the quarter. Though Auto & Home reserve increased and the significant business-driven tax benefit were largely neutralized on an EPS basis, we continued to strengthen our balance sheet fundamentals. Our investment portfolio is solid, hedging is effective and we have $2.5 billion of excess capital and strong liquidity. Let's turn to Slide 4. Ameriprise had strong aggregate shareholder performance. Top line performance was good with operating net revenue up 5% to $3 billion. Operating net revenue without investment income was up 7%, which is very strong. Overall, operating EPS was up 23% to $2.30, and our strong earnings, free cash flow generation and capital return drove an operating return on equity of 23%, which is at the upper end of our target range. The operating effective tax rate was 20.3% in the quarter, which is lower than we had anticipated for a couple of business-driven reasons. About half of the benefit was related to the dividends received deduction being higher than expected. The other half of the benefit was state taxes being lower, which reflected a shift in the states where business activities are occurring. Going forward, we expect the higher DRD benefit and lower state taxes to continue, but the impact would be spread across the year rather than being recognized all in 1 quarter. Looking into 2015, we expect taxes to be in the 26% to 28% range, up from 25.4% in 2014. As you can see on Slide 5, the strong financial performance we had in the fourth quarter was consistent with the excellent year…

[Operator Instructions] And our first question comes from John Nadel from Sterne Agee. John M. Nadel - Sterne Agee & Leach Inc., Research Division: A couple of questions. Maybe to start off, for you, Jim. First, obviously, you've had a lot of pressure in the Auto & Home business over the past year or more, and the results are in stark contrast to what we're seeing from most industry participants, where underwriting results really are among the best in history. So I guess, can you help us understand exactly what you're doing to correct this? Do the -- and do the results of this business alter your view on whether this business should reside as part of Ameriprise or be divested to a more traditional operator?

Okay. Very clearly, we have experienced increase in our reserve positions based on developments that have occurred beginning probably in the 2012 period. We have grown the business tremendously over the last number of years. We have expanded in a number of areas. However, we still feel very good about the front end of the business, the affinity relationships, the ability to bring in good clients in a very cost-effective way, but we had to tighten up a number of various areas from the underwriting to more discipline around some particular areas in pricing, et cetera. So we are making those changes. We think that we have the ability to improve that position over time. But we did take the opportunity here to further increase our reserve positions based on some of those earlier trend lines. We don't have perfect information about them. Having said that, clearly, there are opportunities for us to improve. We think that we can make those improvements. We do believe it is -- it continues to be a good differentiated model. And in the future, we -- once we make those improvements and those changes, we can evaluate the business on a go-forward basis. John M. Nadel - Sterne Agee & Leach Inc., Research Division: Okay. So if we looked out and had to -- and you had to peg when does this business generate an underwriting profit, i.e. a combined ratio under 100%, is that within your visibility next couple of years? Or do you think it takes longer?

No, no. It is definitely within our visibility. And we are looking to see some improvements in 2015 and beyond. Again, it'll be gradual improvements as we make these changes and they flow in. But we really do feel that this is something that we can get back to a good level of profitability. And as I said, we'll evaluate as we go along, but we are aggressively focused on it. It's unfortunate that we have -- some of these things have blipped up, but it's something that we think we can definitely correct. John M. Nadel - Sterne Agee & Leach Inc., Research Division: Okay. That was really helpful. And then just overall, on capital return, the slide this year in your presentation is very similar to last year, that your baseline target of returning and 90% to 100%. And obviously, the last several years, you've done above that. Can you just talk, Jim, maybe to the factors that would influence your decision to bring that down toward the 90% to 100%? Or keep it up somewhere well above that 100% level? I mean, what are the some of the factors? I assume M&A would be -- opportunities would be part of that, share price would be part of that. But can you speak to that in a little bit more depth, please?

Yes. I think to the point you referenced, there are always a number of factors and you go into a year and not knowing exactly what all those factors are and how the environment is. So we -- and which is actually is quite good is that I think very few firms target at the beginning of the year to return 90% to 100% of their earnings. John M. Nadel - Sterne Agee & Leach Inc., Research Division: No doubt.

And so we're doing that, even not knowing exactly how the environment plays out. But as you saw in the past number of years, we've increased that over the year based upon those various circumstances. So if there aren't any real good deals that we want to execute on, we up that buyback. If the market gives us even more opportunity, depending on certain circumstances, we can increase the buyback there as well. So we sort of regulate that. We are still committed to returning strongly to shareholders. We will evaluate again a dividend increase as we always do in the first part of this year. So it's a combination of factors, but I think the positive should be that we're probably one of the highest in targeting that at the beginning of the year based on the total of the earnings, and then we regulate it from there. John M. Nadel - Sterne Agee & Leach Inc., Research Division: Totally appreciate that. And then if I can sneak one more quick one in for Walter. If I look at the annuity segment, I generally see declining account values in both the VA and fixed annuity blocks. So in the face of that headwind, is it reasonable for us to expect any real earnings growth from this segment off of the sort of core 2014 results? I think the core number is about $590 million. It seems spreads are about as wide as we can expect, and with the headwind of lower long-term rates, I'm just wondering, without, of course, Walter, giving any specific guidance, directionally, how should we think about this segment's earnings potential?

I think it's certainly with the headwinds that you talked about, it will be muted, especially if you look at facing the fixed annuities coming out of lapse, coming out of surrender. So you would see that we've made the adjustments on the rate, but we will see increased lapses there. And so I would say, yes, it would certainly be less robust, with the factors you referred to.

And our next question comes from Erik Bass from Citigroup.

Yes, first on Advice & Wealth. You mentioned a 19% margin for the franchisee channel this quarter, which, I think, is higher than even you were talking about at Investor Day of last year. Do you still see additional upside to this margin excluding any benefit from higher interest rates?

Yes. As we talked about, certainly, as we vintage on the employee channel and certainly, productivity and improve that, we do. If you look at the 2 models, certainly, from that standpoint, it would -- we see employee channel increasing, and it has doubled from last year as we look. And we have seen improvement, and I do anticipate some improvement. But again, interest rate is certainly a factor, and certainly market will influence, but we are getting good productivity improvement.

Okay. But you still see from the point that the 19% can stay at this level or move slightly higher even without rates?

Again, yes, I do. As -- again, we're talking environmental and other things, yes. But those into consideration, yes, we are making progress.

And then is there any sensitivity that you can provide for how changes in interest rate assumptions, or if we are in a low for long environment would affect your balance sheet? Know you obviously do the annual review in the third quarter, but kind of any help in terms of sensitivities to your, I guess, long-term rate assumptions would be helpful?

Yes, I think it's from the standpoint, again, on it's not so much the long-term rate. It's going to be the grading. And so it's a start point where you are then the grading from there, which will be the implication. I think the long-term rate, again, we think are -- we're using is appropriate. But we will then have to assess, just like we will now, the start point of where the rate is. And then, what we do anticipate the long-term grading, depending on which product you're looking at. Obviously, the long-term care has a very long window. Others have less. So and -- so that would be the balance sheet impact. The other thing is the reinvestment, returning over, most of about 25% a year. So as we reinvest, that's going to have a bit of a drag on it.

Got it. And can you just remind us what was the change you made in the third quarter of 2014?

The change from what standpoint?

Sorry, for the interest rate assumption that drove kind of the modest charge that you have in the third quarter?

What we did is basically we reset it, obviously, to the June rate. And then we just basically readjusted the grading and slowed it down. We kept the long-term rate the same, but we readjusted down, which, of course, it did not hit the original target we thought that we set in 2013. So we did take that unlocking. And then we just graded it up basically more looking at, from our standpoint, the situation, which was a little slower on grading up.

And our next question comes from Alex Blostein from Goldman Sachs.

Great. Jim, a couple questions on the asset management business, and just a quick follow-up for Walt after. So when I think about the rebranding initiative between Columbia and Threadneedle and you guys will kind of try to go out and market it is one, help me understand, I guess, a little bit what kind of doors does this sort of approach open up relative to what you guys were doing before? What kind of new client pools are you targeting with that? And maybe just some sort of a tangible way to illustrate how maybe 1 plus 1 could equal 3 in that scenario, if that's the case?

So we've made a number of changes over the last 1.5 years or so, really, to put together a number of capabilities between the Threadneedle business and Columbia and put together both core products that are managed by the capabilities of both to how we're even doing asset allocation on a global basis and some of the managed type of activities we're doing and the new solutions that we're launching. So very clearly, there's the underlying activities that already made some changes to what we're doing today and how we're doing it, including the ability to share research, the ability to use some of the capabilities of Threadneedle and Columbia combined to build various portfolios and global products. So the combination of the brand gives us an ability, a further ability, to market our products across borders. So today, we're already selling Columbia funds as part of Threadneedle and Threadneedle as part of Columbia. But particularly, as I think about -- as an example, I'll give you the first one, institutional. To go to market better as a combined firm makes it easier to work with global clients. It gives us the ability to talk about more of those products using our institutional sales force together. It also gives us the ability to use the combined resources for products that we're putting in the market and to talk about that in a much more appropriate way. So we do see good opportunity coming from the combination, but we did a lot of work behind the brand already, and we will do continued more work to really leverage the combined capabilities of the 2 firms. So we will launch this in the market in the spring more formally. Now the underlying for retail distribution in the U.S. or retail distribution in Threadneedle won't be as much severe -- significantly impacted. It'll start more from a global positioning, an institutional basis and then, over time, take shape and form in the retail segments.

Got you. That's helpful. And then the recent product launch you guys announced with Blackstone, internal looks pretty interesting given all the kind of chatter around retail liquid alts in the space. Help us understand, I guess, a little bit how this product will be managed and how it will be marketed to clients. And I guess, how long do you think it requires for us to see some sort of traction from an asset gathering perspective? Is that kind of like you're typical, you seed it and then you market it, and a couple years down the road, so it's going to be a few of years until we see some meaningful progress here? Or could that be done sooner?

Well, we do believe that there is an appetite for this type of product in the retail space today. So it's more of a convenience of a traditional mutual fund with daily liquidity and multiple share classes that will give investors access to Blackstone's Advice multi-strategy perspective that leverage in their underlying hedge fund advisers that they select. And it will combine that with alternative beta strategies and nontraditional assets, including commodities, REITs, inflation linked bonds, private equity managed by Columbia. So the combination, we think, of the types of capabilities that we're bringing to bear put into a wrapper of a retail fund with daily liquidity, we think, will have some appetite as advisors look to diversify their portfolios and get some alternative means based on the market conditions. So I think it gives them a greater access to these alternative type of strategies. It has the combination of benefits of the 2 strong firms and the diversification that they can get from alternatives. So we think it will take shape. We don't think it's something that will wait to see flows over the long period of time. We think there's an appetite there over the course of the year. And hopefully, later in the year, we'll be able to report some of the sales that we're seeing from the product.

Got you. And just a follow-up to that one, how are the economics in this product work? So what's kind of the fee split or the sub-advisory fee that goes to Blackstone?

Well, I think, again, based on the combination of the fund and the makeup, there is a fee structure for the -- as part of the alternative side that will go to Blackstone, and then, there's a fee for the other part of that managed fund that we share, so that we have. And so there's a sharing, truly, of the fee structure underneath it. Of course, with the combination and being on the alternative side, there is a higher fee for that type of product than the normal mutual fund fee.

That sounds great. And then, Walter, just one for you, quick, on the -- when we think about the currency fluctuations over the course of last quarter and certainly, continued dollar strength so far in '15. When I think about Ameriprise holistically as an enterprise, from a pretax income perspective, is it fair to assume you guys are pretty currency neutral given expenses and revenues from Threadneedle, obviously, and pounds?

Well, I would say, it's current yes [ph] because obviously, we make a profit. So we'll take a translation there, if that's what you're referring. That's with the translation. That is the majority of the exposures in -- is out of the U.K. Obviously, there are some offsets, but it is certainly -- it would impact a PTI asset.

Any sense on the sensitivity if it does? So like if the dollar strengthened [indiscernible]

Well, the dollar strengthening is, again -- the pound is moved from -- last year, it was somewhere in the $1.60s and now it's in the $1.50s. So on that basis, it -- I think we talked about last year, it has impacts that are certainly manageable at this -- it's in the, I would say, on the translation basis, it's probably in the $10 million, $15 million range if you drop the -- when you dropped it down. Actually, on that drop, you're probably talking in, say, around $20 million.

And our next question comes from Ryan Krueger from KBW.

First, I had a follow-up on the rebranding of Colombia and Threadneedle. I certainly understand the long-term rationale and the benefits that they could have. But in the shorter term, should we expect any meaningful costs associated with that rebranding over the next few quarters?

There'll be and there were some incremental cost in the fourth quarter. There'll be some incremental cost in the first quarter this year. But we're not looking at real sizable amounts here. What we are doing is repurposing some of our current marketing and branding costs for the new brand, but there'll be some incremental as you change the various materials and signage and some other aspects of it. So it's something that we think is very manageable, but it will increase, of course, slightly based upon the rebranding. But again, as I said, we think it's the right thing to do that can be leveraged over time.

Got it. Okay. And then, on -- given the, I guess, the lower interest, lower long-term interest rate environment we're in today, do you have any updated sensitivities you can give us in terms of the earnings headwind that, that gives you in the fixed Annuity and Protection businesses?

Sure. So let me break it out. The first one, obviously, is going to be on DAC. And when we set our DAC rates, the rates back down were in the $250 million range. Now you -- the start point is in $170 million as we look at, and we are grading up. So that's going to be one impact we are constantly monitoring and so that will have a noncash impact. When we look at locking in the third quarter or if we see this situation, we have to unlock earlier. As it relates to the long-term book with the fixed annuities, it is more on the -- we reset on the guaranteed minimum rates and so this space is just the earning rate, and the earning rates on both that and life and health would be impacted because of the duration of the situation as we turn it over. So like I said, it's about 20%, 25%. And on that basis, you're talking about 40, 50 basis points in differential as we look at it on average as you go through it. So that's the sort of activity levels they see. The numbers themselves are manageable. It's just we are defensive, and in a defensive posture there, and it will have an impact, but the impact is manageable than the number. But it...

Okay. And then last one on the tax rate. You gave the 26% to 28% tax rate guidance for 2015. As we think about the mix of your earnings shifting over time, specifically your -- seems to have a lower contribution from variable annuities in the DRD benefits that, that provides you. Would you expect your tax rate over a longer period of time to gradually rise as a result of the mix shift?

In the current legislation, that's exactly what happens. We also are deriving the DRD benefits, as you saw. But again, the tax rate's associated with the AWM business and the asset management business don't have some of the benefits that are derived, so therefore, they're at the more marginal, the statutory rate. So yes, it will erode, but again, it's good profitability.

And our next question comes from Yaron Kinar from Deutsche Bank.

I want to go back to the P&C results or the Auto results, specifically. And I guess, one question I still have is, looking at PIS count growth, why are we seeing growth, which I think is above industry average, while there's still turmoil and while you're still kind of trying to clean up the claims experience and the previous legacy premiums?

Okay. So first of all, we did -- we do have good growth. We actually have very strong growth in the home side of it. The Auto side has slowed down a little bit. We've made some adjustments over the course. We'll probably adjust a bit more as we go through and put in some of the tighter underwriting and repricing in certain areas. But we did experience some good growth based upon the expansion on some of our channel activity in the affinity area. So it's one of the things that we're closely monitoring right now. We have slowed down a bit of that growth. We might slow it a little more in certain sections where we have experienced some of the blip-up in the exposure. But we do feel like we can continue to add good new clients based upon the relationships that we have, we just got to be -- we're just going to be a little tighter in that regard.

Okay. And then going back to the Advice & Wealth Management. There was an industry publication, I think, that spoke of Ameriprise as the second largest independent broker by commissions from Alternative Investments sold. I think somebody counted about 20% the segment's total commissions earned coming from Alternative Investments. And just given some of the problems that some of your peers have faced with the high-commission product, I was wondering if you'd be willing to talk about kind of what percentage of the alternative investment commissions come from high-commission products?

Well, right now, it is a small percentage of, obviously, our revenue and profitability. But again, it's coming from REITs, and we've talked about, from our standpoint, it's -- that we have not suffered the same situations, obviously, as certainly looking at the quality and what we bring on and our, basically, compliance processes. So with -- from that standpoint, it is important part of the solution set with our clientele and certainly go through a very elaborate due diligence process to ensure that. And like I said, the revenue contributions is under 5%, it's like 3%. So it's an important solution area and it adds value from that standpoint, and it's about the 3% range.

Yes. And I think if you're talking about, like, the REIT area, it's only a couple percent in our total mix of business across the firm. I mean, of course, we have more alternatives that we offer from hedge funds to other types of activities, commodities, various things like that. But I think if you're referencing more of REITs, it's only a couple percent.

Okay, that's helpful. And quick numbers question. I may have missed it, I apologize. On the $20 billion of brokerage cash balances, can you tell us what the current yield is on those?

Around 20 basis points.

And our next question comes from Suneet Kamath from UBS.

So Walter, in your prepared remarks on Protection, you talked about long-term care and the fact that you're conducting, I think, what you characterize as a non-routine review. Can you just go on to a little more detail in terms of what exactly you will be reviewing? Is it the reserve level? Is it gap versus stat? I mean, just any more color on that would be helpful.

Yes. I think what we're doing right now, we're in contact with Genworth as it relates to their announcements and other things like that because they do all the claims and the administration aspect. They feed the information to us. And obviously, we do -- we're aligned on that information. We certainly are trying to do our own checks on it. But we, based on their reviews, we're cooperating with them to get really the performance aspects they've seen, both from claims and other -- to revalidate. As they looked at what they evaluated for their block, how that is applicable to ours, and so we are working with them just to get the additional information as it allows us to do the actuarial assessment.

Okay. But I guess, how should we be thinking about this in terms of a potential risk to the company? I mean, is it that you might have to boost reserves because Genworth is telling you that they're seeing more aggressive claims or utilization? Or -- I just want to get a sense of what the risk factor is.

Okay. I understand that. Yes, we think the risk factor is actually very contained because, again, it's small overall. But the reality is we have our own checks and we've been looking at it from our standpoint. There's different characteristics of our block versus theirs. So we do believe this is a precautionary element to make sure that we are aligned. Again, they're making a major announcement that they did make some changes to their actual assumptions. We felt it was prudent to work with them to get that applicability to our block. They did not do it. And again, it's our block and their block. It's a shared block. So it is really precautionary, but we believe it's very containable, and it's not a significant amount, if any.

And is that something that we're going to learn about sort of in 1Q results because that'll be after they put out their fourth quarter reserve review?

Yes, we're obviously dependent on their time, effort and everything, but yes, we are hoping to have that within that timeframe.

Okay, got it. And then, I guess, for Jim on the retail flows at Columbia, I mean, you've mentioned that it's work in progress and there's all sorts of -- I think you used the word traction that you're gaining. It's just really hard to see from the upside how the strategy is progressing. So is there any more color that you can give us in terms of what is exactly changing there, what's different this time and why we should have some comfort that the flows can start to turn positive?

Yes, I wouldn't think labeling it to get more comfort. I think what we have been saying and what we've actually been seeing is this: we will continue to have some of the type of outflows from some of the things that we've mentioned to you. So as an example, when we made all the pricing changes in the RIA channel, we experienced more of those outflows. That's starting to slow and turn around, and we're starting to see some pickup in the inflow side. For the ex-parent, we experienced more of that, even in retail, initially as things were changed, and now that starting to slow. It'll still be an outflow, but not as material as it was. And we think we can get some new product out there, hopefully, over time, I think, in regard to the intermediary channels, we're actually seeing some pick-up in a few of the areas as we get better penetration in some of the channels and get on some of the platforms. Having said that, I think it's been lumpy. I mean, we saw nice improvement in October and November. We thought it would actually show positive, and then December was a little rough month, I think, for the industry. From a perspective, we still experienced some additional outflows in a particular large fund that we had in the DCO channel that actually sort of masks some of the improvements for some of the other product across the other channels. So I think with the changes we continue to make with the new leadership we have in there, with how we're revamping the way we go to market with our product, with the wholesaling, with the disciplines we're putting in place, we're hoping that we can gain traction with more of our product…

And our last question comes from Tom Gallagher from Crédit Suisse. Thomas G. Gallagher - Crédit Suisse AG, Research Division: A few questions on your Advice & Wealth business. The -- so I guess, the franchisee advisor story has been a really good one. Just want to understand a little about the outlook as you see it. How is the recruiting environment right now? Are you still -- would you still expect to grow that channel over the next year or so? I noticed a little bit of a tick down there in terms of number of franchisee advisors. That's question #1. And then, I guess, the margin, Walter, I think you had said the margin in that channel for this quarter was 19%, which is obviously a pretty robust number. Can you comment a bit about when you are hiring, making the new hires of the experienced advisors, what is sort of the marginal margin you're seeing there? Is it above or below that 19% level?

So let me start with the overall channel, then we'll talk to the margin. Very clearly, we feel very good about our franchise channel and the growth of the productivity of that channel. Now part of it that you're looking at when you just look at the number per se is there is a level of even consolidation going on in our own channel. As advisors hit a certain points in time, they actually don't want to be running the practice as they continue to age at a certain level. And so what they do is make arrangements with other advisors, they sell their practice and then they transition from an advisor to an assistant and then ultimately retire. And we have some of that going on in our channel across the nation that we sort of help foster and develop. So part of our attrition, or so to speak, that we report is part of that activity going on. The assets don't leave. The clients don't leave. But the number on the headcount does adjust. In addition to that, we also have assistants that advisors bring in as junior players in their practice, licensed practitioners, et cetera. And sometimes there is a higher rotation of those people, just like we do, when we bring in new people that we're training and developing in the employee channel. And so part of that turnover is also in those sort of numbers. But we feel that the productivity remains in the channel. The asset growth is good and strong, and we feel very good about that channel continuing to be a growing part of the total. In addition to that, we do have the employee channel. Again, with that same adjustments that are occurring, we have much more productivity in the channel. We're bringing in good people that have much higher productivity than the people who are leaving or left. And the pipeline, so the first part of your question that you asked, is very good. We saw it over the third and fourth quarter. We're bringing in high-quality people that are actually of higher productivities than even previous quarters. And we see that occurring both in the franchise and the employee channel. So we feel like we can continue to recruit on an ongoing basis and see quality people. Walter?

Yes, on the second question. From the standpoint of the marginal contribution, from a PTI standpoint, for the experienced advisors in the franchise and actually in the employee channel are higher than, obviously, the 19% and our current margin employee channel. So yes, that is accreting on the -- based on the correlated expenses that we associated with that -- with bringing on experienced advisors. Thomas G. Gallagher - Crédit Suisse AG, Research Division: And so, Walter, from just order of magnitude, so -- and Jim pointed out that the new hires in the franchisee channel are actually more productive than the average advisor. What type of margin are you seeing for those new hires, let's say, by the end of the first year? Is it -- if the average for that channel is 19%, is it 25%, is it 30%? I just want to get a sense for the grade-in of that and how -- what kind of earnings pick you get as you hire people?

So Tom, let me correct that. I think we didn't say -- for instance, in the franchise channel, we're bringing in good people but we have good strong margins, very high productivity in the franchise. So the people we're bringing in aren't necessarily of even higher margin than that. I think they're consistent with the type of productivity that we have in the channel. In the employee channel, what I did say is the people we are bringing in have higher productivities and will, over time, add to that margin and will be higher than the average margin. But as Walter said, a year ago, that margin was in the low single digits. We ended last year with it being now about 10% or so. And as we add even more productive people and utilize the capacity we have in the employee channel for better productive people, that margin will continue to accrete. Thomas G. Gallagher - Crédit Suisse AG, Research Division: Understood. So it's really the employer channel that you're saying is higher, okay.

Yes. Right. And then the franchisee channel, just as we continue to bring in good client flows and good productivity and our advisor productivity increases, then that will help with the margin there because that's a very large channel. It's a very productive channel. Most of that will come from the productivity improvements continuing in that channel and the use of some of our capabilities to help them do that. Thomas G. Gallagher - Crédit Suisse AG, Research Division: Understood. And then -- and just one last one on the Property Casualty business. Can you quantify -- based on the changes that you expect to make, can you give us a little bit of quantification what are the levels of rate you're actually submitting for to regulators in that business? So are we looking at double-digit rate? Or some -- any quantification you can give there? And would you expect that book to shrink as you implement the changes?

Number one, if we reinstate [ph], again, depending on both -- as we do the price risk assessment and then you deal with the states that -- within theirs, that we will certainly -- we are looking then to get that ratio. As we have had -- we filed in '14, we had rate increases on Auto of close to 3%. And this is now being evaluated state-by-state. We're using the models that we're bringing up. So the rate increases are going to be a very off. So I couldn't really give you an average as it relates to, because you're getting into weighting again to everything from that standpoint. So the reality on shrinking the book, I don't think the book is going to shrink. I think we're going to more intelligently manage through the application of the sophisticated models and the other things that we do from an operational standpoint and just extract the better pricing risk return from it. So that takes time, as Jim said. It just doesn't -- it takes time to work through, both the analytics as we roll it, the filings and then the realization of it. Thomas G. Gallagher - Crédit Suisse AG, Research Division: I would hope your rate is going to be significantly above 3% if we're thinking about '15 [indiscernible]

I only gave you 2014. I gave you price in '14. I didn't say what was going to happen in '15. Thomas G. Gallagher - Crédit Suisse AG, Research Division: Okay. But no, can you give us any indication? Or is it too early?

It's too -- because they basically just started through rolling the stage now, and those will progress and they're focusing on Auto and then rolling through on Home. So I can't give you, really, the rate increases that will take place because they have to do the analytics for each one and then evaluate it on that basis, both looking at the new and then the existing block.

Thank you. And thank you, ladies and gentlemen. This concludes today's conference. Thank you for participating. You may now disconnect.