Thank you for standing-by. This is the conference operator. Welcome to the Brookfield Asset Management Q1 2016 conference call and webcast. As a reminder all participants are in listen-only mode and the conference is being recorded. After the presentation there will be an opportunity to ask questions. [Operator Instructions] I would now like to turn the conference over to Mr. Andrew Willis, Senior Vice President, Communications. Please go ahead.

Thank you, operator, and good morning. Welcome to Brookfield’s first quarter webcast and conference call. On the call today are Bruce Flatt, our Chief Executive Officer; and Brian Lawson, our Chief Financial Officer. Brian will start this morning discussing the highlights of our financial and operating results in Q1. Bruce will then talk about our market outlook and Brookfield’s approach to investing. After our formal comments, we will turn the call over to the operator and take your questions. In order to accommodate all those who want to ask questions, we ask you refrain from asking multiple questions at one time, in order to provide an opportunity for others in the queue. We will be happy to respond to additional questions later in the call, as time permits. At this time, I would remind you that in responding to questions and in talking about new initiatives and our financial and operating performance, we may make forward-looking statements. These statements are subject to known and unknown risks, and future results may differ materially. For further information, I would encourage you to review our Annual Information Form and our Annual Report, both of which are available on our website. Thank you. And I’ll now turn the call over to Brian.

Thanks, Andy, good morning and thank you for joining us this morning. Year is off to a strong start with a significant growth in our asset management results as well as improvements across number of our businesses. And the success in closing $25 billion of capital for our most recent series of funds has us extremely well positioned for a continued growth. Funds for operations for the quarter totaled $703 million compared to $557 million in the 2015 quarter. Breaking this down we recorded $491 million of FFO from operating activities that’s up 25% over the prior quarter and $212 million from disposition gains and that’s up from $162 million. Net income was $636 million or $0.23 per share, net income benefited from the improved operating results and continued increases in the value of our operating portfolios, which gave rise to $352 million of fair value gains. We did however record a higher level of appraisal gains in 2015, which is the principal reason for the higher level of net income $1.4 billion booked in that quarter. So turning to our asset management results, fee bearing capital was $104 billion at the end of the quarter, up $11 billion over the last 12 months. And subsequent quarter end capital raised in our private funds added an additional $10 billion of fee bearing capital bringing the total to $114 billion, and increased our annualized fee revenues and target carry to nearly $2 billion. The increases in fee bearing capital came from a final close on our $9 billion flagship property fund along with commitments of approximately $12 billion to our latest infrastructure fund and more than $3 billion to our private equity fund. All-in-all our latest series of funds sold $25 billion in capital and that’s the largest amount of investable…

Thank you, Brian, and good morning, everyone. This morning I thought I cover four topics and then Brian and I’d be pleased to take questions. Starting off I’ll briefly highlight our views on the current market environment then give you a little bit of update on fund raising, picking up on the larger trends from where Brian left off and also just mentioned Brookfield business partners. As we all know the first quarter was marked with volatility in the markets. Stock sold off largely on concerns of a slowdown in global growth, but then bounce back as those fears seem to dissipate. It’s understandable for to get caught up in short-term movements in stock prices. But I guess we continue to emphasize and believe that the way to create long-term wealth is to acquire assets at attractive valuations and run them like we are going to own them forever. For all the noise you hear right now both the headwinds for stocks our view is that the markets are pretty good, not great but overall conditions are positive for most companies. Rates remain very low; North American banks have never been in better shape as a result liquidity is excellent with few exceptions in specific industry. Corporate balance sheets across North America again with a few exceptions are very strong and companies are expanding certain sectors. Of course such as commodities are facing challenges or regions such as Brazil and that’s creating opportunities for value investors. Turning to fund raising, as Brian mentioned against the backdrop of low interest rates and the volatility in stock markets we believe our real asset strategies have significant appeal in particular for institutional investors. Property, infrastructure and private equity are excellent places to commit capital for those investors with long liability such as pension…

Thank you. We will now begin the question-and-answer session. [Operator Instructions]. The first question is from Cherilyn Radbourne of TD Securities. Please go ahead.

Thanks very much and good morning. So you’re in the later stages of completing a very successful round of fund raising. And I’m curious if we were to look at the distribution of your private fund capital by geography and by investor type, how has that evolved versus what it look like when you raised your second flagship funds?

So I’d say over the years and I won’t refer to any specific fund. But over the years, our capital originally mostly started in Canada and in the Middle East. And that was because we didn’t have track records of fund even though we had an investment track record we didn’t have track record of funds. And so I’d say that we now have obviously significant track records in the funds that we have for 10 years. And therefore much more significant amount of our capital comes from U.S. institutional plans than it did in say fund one. And probably the second biggest change over the years has been that our -- it's a Asian institutional investors have continue to put money into real assets and into funds and into investments outside of Asia. And so those commitments have been growing. Probably both because our name is known and our relationships are better, but also because there is more significant amounts of capital coming from those types of groups today.

Great. And my second question is you’ve already invested over 50% of the commitments your latest property fund, which is remarkable so I wonder if you could just comment on some of the larger transactions that have gone into the funds and what that piece of investment implies in terms of when you could start fund raising for a successor fund?

So just in general what we do with a fund is we start fund raising and once we have a first close and sometimes before that we’ll commit to transactions in a fund and we just did the final close and by the time we had done all the fund raising we were about probably 35% or 40% invested and we’re now approximately 50% invested. When you’re at 75% or 80% invested in a fund you can then start fund raising for successor fund and what it’s meant to do is that there is a continuity of investing as oppose to having a period of time when you don’t have capital to investor institutions. So I suspect by mid-2017 we’ll have invested the moneys in that fund. Specifically to transaction that are in the second real estate fund, you will -- I think you will see us do multifamily transaction in the United States, which was a significant transaction that we bought multifamily apartments. We’ve bought a hospitality business in the UK called Center Parcs, we bought 7 office buildings in Rio and Sao Paulo and we bought a self-storage company in the United States recently as well as a land lease business for manufactured home communities in the U.S. So it’s a pretty diverse portfolio on top of that we always have office and retail developments that we’re doing along with our business that go into that fund on a more opportunistic basis. So it’s a pretty broad group of investments we’ve made within the fund.

Thank you; that’s my two.

The next question is from Bert Powell of BMO Capital Markets. Please go ahead.

Hi this is Adel Kanso on behalf of Brook Powell. My first question we have seen certain competitors also being active in fund raising to pursue assets that are backbone to that economy. Would you say there are more competitive pressures today on the type of assets that Brookfield is bidding for? Do you see that impacting the yield or return on investment moving forward for example CPPIB came for Asciano and now bidding for assets in Peru and other regions?

Yeah first I’d start off by saying there is always lots of competition in the world for everything and we have to be good at what we do and try hard every day to accomplish getting the returns we get. So it’s never easy, point number one. Point number two is we try to focus on transactions that we have a competitive advantage with and I guess we try to focus on three things, number one is and often people heard us say that it’s size of capital we have more money than most people to invest in transactions and that just allows us to do things, which a lot of others can’t do just because of the size of transaction and we bought the Columbian Hydro Company recently for $5 billion and they are just weren’t too many people that could fund $5 billion to do that transaction. So size just helps us to eliminate ourselves from the crowd or separate ourselves from the crowd. The second one is we’re in 30 countries in the world and we have operating people and investment people in all of them. And that allows us to move our money in the funds, which are global to the places where there is a lack of capital and that usually helps us get returns and differentiates us from others. And maybe the most important that we see is our operating capabilities is third and it allows us to do types of transactions which might be perceived as something that others can’t do. But we have a lot of people to be able to work on the transaction that words or if we make mistakes to work ourselves out of the issues that we have. And so those operating capabilities of 50,000 people we have in the business, give us tremendous advantage. So I’d say, those three things are all what we’re focused on trying to differentiate ourselves in transaction.

Thank you. And my second question, over the past year Brookfield has been less active in pursuing opportunities in Canada relative to other countries. Given the current economic backdrop in Canada’s resource sector is Brookfield looking to deploy more capital in Canada in the near-term? And are you finding an increasing number of opportunities at attractive valuations? And are those opportunities more so an infrastructure, renewable or property?

So, as most people would know about 10% of our overall business is in investments in Canada. And, so we have a very large businesses in Canada, but just given the scale of company and investments that we have, there is just not as many opportunities in Canada or would be for example in the United States. Despite that, I would say that Canada is a great place to invest and we always would look to find investments in Canada. But there is a lot of money in Canada looking for investments. And therefore it’s always difficult. On the other hand now that the markets have -- are a little bit different for commodity producers, I think there will be more opportunity that will come about and it could be in all of sectors that we -- four sectors that we operate in. So, I would say, I would favor more investments in the next few years than it have been in the last few in Canada.

Okay, that’s my two questions. Thank you.

The next question is from Alex Avery of CIVC. Please go ahead.

Thank you. Bruce on previous calls you’ve always talked about Brazil in a pretty favorable late have of a lot of confidence there. There is I guess been a new chapter in that saga yesterday with the suspension of the President. Can you I guess give us a sense of whether that’s sort of part of your expectations or if anything has changed there? And also a sense of if, you’ve seen a change in recent months in competition for assets in Brazil?

So, I’ll try to answer your question, I’m not sure where to start. I would say firstly that it’s been a tough market in Brazil over the last couple of years. Economies are under severe stress and on top of that all of the political people has been difficult for business in the country. And so it’s been tough and interest rates are high and foreign investment flows of the country has been low. So, it’s been a tough market. Despite that, I’d say we still believe that it is a great long-term country to invest in. It has an enormous resource backing a big middle class population. It has and it has proven over the last while to have a judiciary that’s separate from the government. And those are good things that we’ll adhere to the long-term value proposition in the country. As a result of that we’ve been putting significant amounts of money into Brazil and will continue to do so. And you will not see a quick turn in Brazil, but we think it’s probably bottomed and it’s getting better in a number of the businesses in particular any business related to exports in the country. And the country’s currency came off and the export businesses are doing very well. And we’ve seen that in the number of a numbers of our businesses in the country. Despite all that it’s not going to turn quickly, but on the other hand the opportunities to invest capital are very attractive and they either fit in two categories. There’re opportunities which would have never become available before, but are now available or second at values which you would have never had before or a combination of the both. So, with it’s a good market, but we will continue to be prudent with how much capital in relation to how much we deploy putting into the country.

Okay. And then just secondly on China, we’ve been sort of studying that market and investing on a selective basis for a little while. There is a lot of capital coming out of China currently. And just wondering how you’d think about China and do you see sort of medium term target in terms of percentage of assets that you might want to put into that market?

So we continue to selectively invest into China and we will and when we find the right opportunity we’ll put money and we never set targets as to how much money we should in any area. We’re more opportunistic than that and therefore we really don’t have any goals. I’d say over the next 10 years odds favor we will have more capital invested in China. But I don’t -- we don’t have any target as to how much it would be. The one thing that we are seeing is very significant amounts of capital being invested from China to other more developed markets. And again the story gets confused because most people interpret that that as people taking money out of China and wanting to have it out of China. And that’s possible some of the money is that. But a lot of it is that the institutions in the country have been encouraged to invest outside of the country. And they’re starting to go from they initially where zero percent outside of the country for example in the insurance companies and over 3% now they’re allowed 15% foreign investment. So a lot of this is just them like North American institutions, which used to have prohibitions that they could invest in their own country for example Canada institutions could only invest in the country. Now they’re I think are totally unrestricted. They can invest 100% outside of the country. China now is going from 0% to 15%. You may never see that 100%, but that will continue to increase overtime. And the size of the amounts of money is very, very significant in these institutions. So I think you’ll -- we will see that for the next 25 years until the life insurance market starts to payout as oppose to moneys coming in and sovereign wealth funds are needed elsewhere.

Okay, that’s great. Thank you.

The next question is from Andrew Kuske of Credit Suisse. Please go ahead.

Thank you good morning. You have a pretty unique business model when we compare to a lot of the other alternative asset managers because you’ve got the public LPs and then obviously the private capital side of things. And so as your private business continues to gain fund raising momentum, which you’ve clearly demonstrated more recently. How do you think about the pace of growth of the public LPs when compared to that private business?

Yeah I think I’d just say that we set those entities opted to only assets that we had on the balance sheet that the assignment of funds are a portion of the growth in LPs going forward. And we can dial up and down the commitment we make to the private funds based on the capital that they have available. And we can also recirculate assets on the balance sheet. So -- and all of the entities with the exception of BBP that isn’t an existence yet, but the three entities that we have are all self-sustaining entities. So they can recirculate capital on their own balance sheet to make commitments to anything that we do. And if we need to go from 40% commitment to 25% because that’s in their own capital needs or sources we can do that on the next fund on the next fund. So we have the flexibility to be able to grow those entities in the fashion we need to with really a goal of their sole objective is to earn decent return on capital and pay relatively high FFO payout to their LP investors. So we continue to do that and I think they’re well situation to build to help us with everything we’re doing.

Okay, that’s very helpful. And maybe a bit more nitpicky question as it relates to the relationships between BAM and one of the LPs. Just on the power marketing business that’s still held within BAM and obviously it’s part of the counterparty relationship with BRAP. Is BRAP at the size now where that business would really make sense to be at BRAP as oppose to sitting on BAM’s balance sheet and just being obviously in the current market environment being a bit loss maker minor, but still a bit of loss maker.

Yeah I would just say we set it up originally the way we set up. Because we wanted to ensure that the BRAP as an LP had a stable source of income and we believe long-term in the power markets. I think given that the power prices have been low on the marginal power that we sell with our contracts and therefore we are taking losses on that right now. It’s probably not the time you would have ever consider that. But what we probably will do longer-term is put a lot of long -- put the rest of the power into long-term contracts and then it’s possible we could just assign those contracts down to the company and get off that trading business. So it’s possible we do that in the future, there is no -- that we don’t have any intention of doing anything today. And we have to make sure that all of our shareholders at BRAP wanted and it was the right thing for them to do. So I guess we are open to it in the future. But I want to make sure it’s right for everyone.

Okay, that’s very helpful. Thank you.

[Operator Instructions] The next question is from Mario Saric of Scotia Bank. Please go ahead.

Thank you and good morning. Bruce, I want to just come back to the discussion on Asia, clearly going from 10% of the kind of LP based to 33% over time is pretty material. I think as Alex kind of mentioned around your committed capital to the region historically hasn’t been overly material while it’s growing, and then only now our LP investors expanding outside of Asia. So you mentioned brand recognition is being important just curious if you kind of elaborate or go through how you think you’ve achieved that brand recognition in Asia and where it might go going forward?

I would just say our brand recognition is still has a long way to go in Asia because we don’t know that many people. It’s a lot more than it was 10 years ago and a lot more than it was five years ago. The second thing I would say is we have relationships with most of the large institutional clients in the region and as we bring the one fund we then have brand recognition to keep coming back for them the second, third and fourth time. So that just builds on itself and I would say we are working on a lot of the institutions there and what’s happening is both the pie is widening meaning there used to be 10 large insurance companies in China and there will eventually be 35 or 50 of them. And therefore you will just have more entities to talk to, but secondly the sums of money that they have to deploy are growing dramatically both in the sovereign plans in each of the countries. But for example in the insurance plans because the insurance plans in Asia and particularly in China have a very -- they didn’t used to have insurance. So they have a very young population who are starting to put money in an insurance plans and they are not paying out yet. So they need money to invest for the next 30 years and start paying out 30 years from now. So we have a big effort on continuing to build up our resources there. On the investment side that’s a separate item, but in particular on the fund raising side.

Got it, okay. And then my second question is just with respect to capital deployment risk you’ve touched on some of the topics already, but clearly you’ve been very successful in ramping up the fund raising business. Your flagship funds are getting twice the amount of capital, the predecessor fund has received, but along with that comes having to deploy $25 billion as to $12.5 billion. So clearly you have a credit advantage in terms of size and global scale, but internally how do you think about the risk on deploying $25 billion versus $12 million out acceptable returns?

I would just say -- I would make the comment and it’s always -- this is all dangerous to say, but I would say that as the company has gotten bigger we built out the systems in the risk management within the organization and we think it’s easier today to deploy larger amount of capital than it was before on smaller amounts of capital and it’s just the competition smaller and when the competition is smaller you can do things which you otherwise wouldn’t be able to do when you are competing in a transaction with 35 people bidding for something. And so I would say we don’t really see any issues in deploying larger amounts of money. In fact I could probably make the opposite argument to you.

Okay, thank you.

This concludes the question-and-answer session. I would like to turn the conference back over to Andrew Willis for closing remarks.

Thank you for being part of the Q1 call and we look forward to updating you at our annual meeting in June and after the next quarter. Thank you.

This concludes today’s conference call. You may now disconnect your lines. Thank you for participating and have a pleasant day.