Hello, and welcome to the Equitable Holdings, Inc. Full-Year and Fourth Quarter Earnings Call. [Operator Instructions] After the speaker's remarks, there will be a question-and-answer session. [Operator Instructions] I would now like to turn the call over to Erik Bass, Head of Investor Relations. Please go ahead.

Thank you. Good morning, and welcome to Equitable Holdings full-year and fourth quarter 2023 earnings call. Materials for today's call can be found on our website at ir.equitableholdings.com. Before we begin, I would like to note that some of the information we present today is forward-looking and subject to certain SEC rules and regulations regarding disclosure. Our results may differ materially from those expressed in or indicated by such forward-looking statements. Please refer to the safe harbor language on Slide 2 of our presentation for additional information. Joining me on today's call is Mark Pearson, President and Chief Executive Officer of Equitable Holdings; Robin Raju, our Chief Financial Officer; Nick Lane, President of Equitable Financial; Bill Siemers, AllianceBernstein's Interim Chief Financial Officer; and Onur Erzan, Head of AllianceBernstein's Global Client Group and Private Wealth business. During this call, we will be discussing certain financial measures that are not based on generally accepted accounting principles, known as non-GAAP measures. Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures and related definitions may be found on the Investor Relations portion of our website in our earnings release, slide presentation and financial supplement. I will now turn the call over to Mark.

Good morning, and thank you for joining today's call. 2023 marked a momentous year for Equitable as we celebrated our fifth anniversary as a public company and hosted an inaugural Investor Day to tell our story and provide updated financial targets. We're very excited about the road ahead for Equitable Holdings. In our Retirement business, higher interest rates and favorable demographic trends while providing the best environment for growth in well over a decade. In Asset Management, AB continues to see strong client demand for private markets investments, and we're optimistic that stabilization of interest rates will lead to a resurgence in fixed income flows. Finally, our Wealth Management is attracting strong client inflows and should continue to benefit from Americans need and desire for financial advice. This morning, I'm going to provide an update on the progress we're making against the strategic initiatives provided at our Investor Day and then turn it over to Nick and Onur to talk about the strong commercial momentum we're seeing at both Equitable and AllianceBernstein. Then Robin will focus on our financial results and outlook for 2024. Turning to slide three. Full-year non-GAAP operating earnings were $1.7 billion or $4.59 per share, which is up 6% year-over-year on a per share basis. 2023's reported results were below our expectations, primarily due to lower returns on alternative investments and elevated mortality claims during the first three quarters of the year. After adjusting for notable items, non-GAAP operating EPS was $5.13, which is up 3% compared to prior year, while short-term headwinds put pressure on earnings this past year. We expect non-GAAP operating EPS growth to accelerate in 2024. Strong equity markets and stabilization in interest rates bode well for improved alternative returns, and we're encouraged that mortality returned to more normal levels in the…

Thanks, Mark. As Mark mentioned, we're seeing good growth momentum in our core retirement business, with record sales and flows in Individual Retirement and strong value of new business. Given the demographic changes with the majority of baby boomers now hitting peak retirement age 65. This is a very good time to be in the Retirement business, and Equitable is well positioned to take advantage given our leadership position in the RILA market and strong distribution platform. We're also making meaningful progress in scaling our wealth management business with both earnings and organic growth running ahead of the plan provided at Investor Day. Wealth Management is our fastest-growing segment, and Equitable advisers is a critical differentiator for our retirement business. We're a top 10 independent broker-dealer with 4,400 advisers and $87 billion of assets under administration. We see continued demand for personal financial advice with 65% of American investors seeking advisers to help them with their financial needs. In 2023, we had advisory net inflows, a 7% annual organic growth rate, which, in combination with market tailwinds resulted in AUA growing 20% year-over-year to $87 billion. A key leading indicator of our ability to grow advisory assets is growth in the number of wealth planners on our platform. These are advisers who focus on reoccurring fee-based investment accounts, and they are 3 times more productive than non-wealth planners. In 2023, we increased the wealth planner count by 7% and to 750. Wealth Management earnings increased 57% year-over-year to nearly $160 million putting the business well ahead of plan to reach $200 million of earnings by 2027. Higher short-term interest rates have provided a nice tailwind driving an increase in revenue from cash sweeps. While we could see some earnings pressure if the Fed cuts rates this year, the strong growth in AUA bodes well for growth in fee income. Now I want to turn to the third pillar of our strategy, which is to seed future growth. We continue to lay the foundation for our institutional in-plan guarantee business, which is reported in Group Retirement. Today, there are $7 trillion of assets in 401(k)s with approximately $3 trillion invested in target date default options. The passage of the SECURE Act 1.0 and 2.0 served as catalysts, providing safe harbor to include annuities within 401(k) target date funds, opening up a substantial new market opportunity for insurers. We're well positioned to capitalize on this through our existing partnership with AllianceBernstein, a first mover in the implanted annuity market over a decade ago and the new offering we developed in partnership with BlackRock. We expect to see initial inflows from BlackRock in 2024 as they work to onboard 11 committed clients. While it will take time, we see potential for significant growth in the market over the next few years. I'll now pass it over to Onur for an update on AllianceBernstein. Onur?

Thanks, Nick. We continue to believe the global asset management industry is poised for growth in coming years, and AB is well positioned from a competitive standpoint, given its global platform, diversification across asset classes and distribution channels and solid investment performance. While AB was not immune to slowing institutional demand this past year, we have grown organically by 2% on average over the last five years, well outpacing the peer group. In 2023, we grew strongly in retail and private wealth, driven by market share gains in both U.S. retail and our offshore high-income business. Fixed Income markets, both taxable and municipal who are key sources of strength in 2023, which has continued into the new year. In addition, we saw strong growth in our activity platform, which now has 12 funds with $1.5 billion of total AUM. Looking ahead, our institutional pipeline currently sits at $12 billion with our private markets platform representing over 80% of the fee base. Private markets continues to be an area of strategic growth for AB with AUM up 9% year-over-year to $61 billion as of year-end, supported by capital deployed from Equitable general account. Our private wealth business is also seeing strong demand for private credit and has further headroom for growth. We have historically been successful in raising third-party capital and strategies ceded by Equitable, and we continue to target $90 billion to $100 billion of private market AUM by 2027. Areas of inflows in 2023 included secondary, renewable energy, mortgage loans and European commercial real estate debt sale of this driven by Equitable's commitments. In 2024, we are fundraising in AB CarVal flagship strategy as well as ABPCI, our middle market lending business, including a new NAV lending strategy. As we look to see future growth, our global distribution platform…

Thanks, Onur. On slide seven, I will discuss progress against our enterprise level financial targets that we laid out at Investor Day. Cash generation remains our North Star, and we target producing $2 billion of cash flow to the holding company annually by 2027. In 2023, we up streamed $1.3 billion to the holdings, which is in line with guidance that we provided earlier this year. Our strong free cash flow enables us to consistently return capital to our shareholders. And as Mark noted earlier, in 2023, we returned $1.2 billion through buybacks and dividends. This equates to 72% of reported non-GAAP operating earnings above the high end of our 60% to 70% payout ratio target. Finally, non-GAAP operating earnings per share increased 6% on a reported basis and was up 3% after adjusting for notable items. This is below our target of 12% to 15% non-GAAP EPS growth CAGR through 2027 primarily due to elevated mortality claims and below plan alternative investment returns. We expect both of these headwinds to ease in 2024, which, coupled with strong fourth quarter equity market and our organic growth momentum should drive meaningful improvement in earnings per share. Turning to slide eight. I will touch on results for the fourth quarter. On a consolidated basis, Equitable Holdings reported non-GAAP operating earnings of $476 million in the quarter or $1.33 per share, up 54% year-over-year. After adjusting for $3 million of unfavorable after-tax notable items, non-GAAP operating earnings were $479 million or $1.34 per share, up 20% on a year-over-year basis. We have detailed results by segment in the appendix, but I wanted to briefly touch on a few key drivers. Alternative investment returns were minus 1% in the fourth quarter, resulting in a $0.17 reduction in earnings per share versus our normal expectation,…

Thanks, Robin. In closing, Equitable delivered solid business results in 2023. While non-GAAP operating earnings faced some near-term headwinds, we still achieved our cash generation guidance, and our full year payout ratio was in line with our 60% to 70% target. We also delivered a 20% total shareholder return, helped by the December announcement of our inclusion in the S&P 400 Index. Looking forward, I'm particularly pleased with the growth momentum across our businesses, which shows up in both record retirement and wealth management net flows and, importantly, value of new business. We're also delivering on our strategic actions to improve margins and enhance investment income. I'm excited about the opportunity for Equitable to capitalize on the current favorable growth environment, and we remain confident in our ability to deliver on the financial guidance we outlined at Investor Day. With that, we'll now open the line for questions.

Thank you. [Operator Instructions] Your first question comes from the line of Suneet Kamath with Jefferies. Your line is open.

Thanks good morning. Robin, can you maybe just give an update on the Protection solutions that you're considering? I mean, you've given us earnings guidance for that line, but I'm assuming that guidance doesn't include the impact of anything that you guys are considering. So maybe an update in terms of what you're thinking about timing? And then should we expect either an impact on earnings or cash flow to the extent you implement the solution? Thanks.

So 2023 was a challenging year for Protection Solutions. That reflects both excess mortality and also lower alternative returns, the majority of which get allocated to that segment. In the fourth quarter, as you heard in the call, if adjust for notable items, the segment earned $68 million, which is on the upper end of the guidance. Focusing on mortality, we were encouraged by results this quarter as claims were in line with expectations and reinsurance coverage was as well in line. But if you look at the last two quarters and just look at gross claims, both were in line. So growth claims were in line with our expectations last quarter and this quarter. We are optimistic that we've experienced the biggest impact of the pull forward in the older age claims. But that said, as I mentioned on the call, we do expect continued pull forward in 2024, and we're watching in the fourth -- we haven't seen anything yet, but we're watching in the first quarter as mortality tends to be higher due to seasonality from the flu season. So we do expect the $200 million to $300 million guide for 2024 to still exist. Now we are -- as you mentioned, we're encouraged by the mortality in the quarter. But cognizant that results from mortality for the last year has not met our expectations. And Ultimately, this is one of our smallest businesses, comprising of 10% of earnings. Therefore, we are reviewing all options to improve profitability and reduced earnings noise as we think it could be additive to shareholder returns. That being said, we're not going to just rush into anything, we're going to make sure that it provides economic value over the long term and improve cash flow to long-term for shareholders. But all options are on the table for us to improve the returns on this business.

Got it. Okay. And then I just wanted to come back to individual retirement. Obviously, your biggest segment, and I would argue it's getting a pretty low valuation in the market. So given all the changes that you've made, and I think the risk profile is quite a bit different than typical VA companies. I think it would be helpful to just kind of talk a little bit about the tail risk or lack thereof in this business. And what the biggest risks are in the individual retirement business that you've retained? Because I think that's something that's still not getting a lot of attention in the market? Thanks.

Sure. We're really proud of this business. As Nick mentioned on the call on Mark, it's a tremendous time for the retirement business across the board, strong organic growth, $1.5 billion of net flows in the quarter. The biggest shift we made -- I mean, this has been a journey to shift is reducing the tail risk in the portfolio. And that's mostly in the legacy business, and that was gone away over time through the Venerable transaction. This core business, as you see in the appendix slide, it's primarily spread-based earnings. So the biggest risk that we have is the credit risk. And as you know, we manage a more conservative portfolio, but really what we're generating is spread-based earnings from that SCS product. It's short duration, ALM matched, and it's high quality. And over time, this comes through into cash flows. The biggest driver to cash flows for Equitable Holdings is that retirement business. And as we continue to generate strong growth in the business, that will improve cash flows over time.

Your next question comes from the line of Elyse Greenspan with Wells Fargo. Your line is open.

Hi, thanks. My first question, Robin, based on the capital plan that you guys laid out, right, you're still going to end ‘24 with a pretty healthy cushion at the holdco? And I know we've discussed this in the past and you guys just want to be conservative. But as you think out through '24, can anything change that stands, cash to parent is going up, right? And remaining at the same capital return target? Just trying to think what could cause -- you don't want to take down that cushion at some point during this year.

Sure. I think let's just focus on 2023 for one second. We paid out on the higher end of our payout guidance, over 70% on a reported basis, 65% on a normalized basis. And we dipped into some of the holdco cash last year to do that. And going in 2024, we continue to guide. We expect cash generation to be strong at $1.4 billion to $1.5 billion and we'll be in that payout ratio of 60% to 70%. And if we see the opportunities to buy more stock in the market and overall tailwinds continue, we'll look to utilize some of that cash. But I think the strong cash flows represent the strength of our business model, coming from non-insurance sources, asset and wealth. And that gives us the opportunity to navigate both uncertain markets, and we can be offensive as well. So it provides us the flexibility that we want at the holdco.

Thanks. And then maybe continuing there, right, you guys have done some large legacy transactions. We've obviously seen transactions build up within the sector. in the back half of last year. Is there any kind of updated thoughts on potentially doing another transaction with your legacy blocks?

The legacy block is small. It's in runoff less than 10% of earnings for us. It will continue to run off and it kicks up good cash for us. Obviously, if something was available, and again, it provides shareholder value. That's our role. We're always looking to maximize shareholder value, and we'll look at it. But our primary focus right now is growth. We see a tremendous opportunity in the U.S. retirement market, that's where we're allocating capital with these type of returns that we see. So that's our primary focus is growing to cash flows. But obviously, we always look to optimize the portfolio if we see something that's attractive for shareholders.

Thank you. Your next question comes from the line of Ryan Krueger with KBW. Your line is open.

First question was on SCS and RILA products generally. Certainly, you've had great growth there and the industry has as well. Just curious to what extent do you think product demand is for RILA product is influenced by the level of interest rates if interest rates do come back down? Or do you think it's not really that sensitive and it's really more just about secular demand for the product at this point?

Yes. This is Nick. Look, I think it's a great time to be in the market driven by both structural forces, and I would highlight the demographic changes we're getting to peak 65 with the majority of baby boomers entering retirement. They're not just living longer. They've got different expectations on average 20 years. So we see that structural shift contributing to the demand that's going on. I would add, that's amplified by, I would say, asset volatility given the geopolitical uncertainty going forward. So it's a great time to be in buffered annuities. As the pioneer in this market that launched the product over 10 years, I think you've seen consistent growth, both in our business and an expansion of the market and low interest rate and high interest rate environments.

And then just a question on the interest rate sensitivity guidance of $40 million to $45 million per 50 basis point change. Are you able to disaggregate short-term interest rates from that? I'm just trying to better understand your -- I understand the short-term rate sensitivity in the wealth business, but just trying to understand what it could be in the rest of the business as we get closer to the Fed starting to cut rates?

Yes. I think primarily, with the Fed rate, that's the cash sweep revenue sensitivity that we gave you. So plus or minus 100 basis points Fed is about 70 basis points of cash sweep yield. That's our primary exposure to the short-term rates. The interest rate sensitivity of plus or minus 50 basis points, $40 million to $45 million of after-tax non-GAAP earnings, that's, I would think the tenure is a better proxy for that sensitivity.

Your next question comes from the line of Alex Scott with Goldman Sachs. Your line is open.

Hi, first question I had was on the ordinary dividends from New York. I heard the comments that a bit more will come from Arizona. This year, it sounds like associated with the New York formula. And I just wanted to check, I mean, is that something that we should think about going forward? Like for the foreseeable future? Or is that something nuanced around the calculation for 2024? I mean certainly, the overall cash flow number still looks very good. So I don't want to discount that, but I just want to understand the underlying dynamics there.

More than 50% of our cash flows come from asset and wealth businesses where we don't have to deal with insurance dividend formulas. The intern over reinsurance transaction moved about 50% of our liabilities to Arizona, and that will be more based on an RBC-based approach. I think since IPO, we've been -- we've always said some years where we've had lower dividends in New York, some years where we've got higher dividends from New York due to the volatility in the formula. I'll remind you though in 2023, we took out actually $1.7 billion from the New York Company $600 million went to the holdco and $1.1 million, we used to capitalize the Arizona company. So we continue to take a lot of cash out and our strategy is -- and that's why you see the cash at the holding company. We want to take as much cash out of the insurance companies as possible, and we prefer to have it as the holding company. And over time, that's -- you've seen that in the consistent cash flow as we generated.

Understood. So this is something that sounds to me like it's more specific to 2024 dividends?

Correct.

Got it. Okay. follow-up I had is just on the BlackRock clients that are coming on board in 2024. Can you help us think about how impactful that is? And I mean, is that just an initial group of clients, but that will build? I mean, can you help us think about the magnitude of that opportunity and how we should think about it over the next few years?

Sure. This is Nick. First, we see this market as offering significant, I would say, long-term opportunity as we highlighted in the call, the 401(k) market represents over $7 trillion with qualified default options capturing roughly 50% of that. This is the initial stages of that that's emerged over time with the passage of SECURE Act is both the insurance leading asset managers and receivers into solutions. We expect to get flows from BlackRock over this year. They will come in, in a lumpy fashion with large initial deposits but then supported by recurring premium. So overall, we're excited about the long-term prospects and view this as part of the solution to solve the emerging U.S. retirement crisis.

Thank you.

Your next question comes from the line of Tom Gallagher with Evercore ISI. Your line is open.

Good morning, and first is just wanted to get a better directional sense on capital return, how you're thinking about it, the $1.3 billion authorization? How should we think about that? Because if I look at what you're -- if you're just really planning on generating what your free cash flow guidance implies, it would probably suggest your buybacks run at a similar level to what you return this quarter, $240 million or so, at least in that ballpark. Obviously, the $1.3 billion buyback is quite a bit above that level. Can you comment on, are you planning on stepping it up, staying at the $240 million level? Just directionally, can you help bridge that?

I think the most important number to have in mind is the $2 billion of holdco cash that we have. That provides us the flexibility. The authorization itself, it doesn't expire so that will provide us timing. If markets ended up coming higher and earnings were higher, we can have higher share buybacks. But the ultimate guide is the 60% to 70% payout ratio. Since IPO, we've always been consistent in maintaining in the payout ratio guidance we've had. And if we see markets are good and earnings are higher, then we'll return more. And that's what the flexibility of the authorization provides us.

Got you. The -- Robin, the follow-up is the $200 million to $300 million level of protection annual guidance. If we think about you potentially finding a reinsurance solution that reduces the volatility. Is it fair to assume the level of earnings will likely go down because obviously, you're going to have to pay for the protection? Or do you just see the range narrowing? I just want to understand like how to think about dimensioning how you're approaching that?

Yes. I think it's fair to assume that when you do reinsurance, you're giving up some economic cost. That may not translate into earnings now, that may translate into lower earnings in the future. Life businesses are long tailed, so it could be 15 to 20 years. But it's an economic cost trade-off that we're measuring against. But we would expect by -- if we did something that it would lower or narrow the band for the Protection Solutions earnings base. But we're looking at a range of potential options. And what we're trying to find is what provides most economic value for shareholders.

Got you. Thanks. And if I could just sneak in one more. Just on the whole commercial real estate market, we'll call it concern that NYCB has created and you've had some other issues occurring here, they get started with a people were -- have been concerned about office and now it seems to be spreading to multifamily. Just curious if you guys have a broader market view, if you think things are going to get worse from a broader market perspective and what that might mean for your exposure to CRE?

Yes. Maybe quickly on broader market, but I'll use your question to give you some more details on our portfolio as well. Look, the broader market obviously remains challenged across -- mainly on the office space we see primarily across, it could dip into multifamily. But again, just like anything and more specifically on real estate, it's all about where you are, what type of buildings you're in and location really does matter. And the debt and equity structure matter. So you can't always think about the headlines, what the bank zone are sometimes of different quality, what the insurance company owns just by the capital nature of these securities as well. For Equitable, the office portfolio represents about 5% of our total general account. It's a pretty high-quality portfolio with solid operating results. We're on Class A buildings. I think the metric that I looked at, at the end of the year for us internally was our debt-to-service coverage ratio, it actually went up to 2.3 times as of the fourth quarter, which was up from 2.1 times and that reflects improved operating income from the properties that we have. The overall mortgage portfolio LTV was 64%, which bodes well. It's slightly higher than last year, but that's just due to the lower valuations. We successfully resolved all of our 2023 maturities, and we only have five office loans maturing in 2024. We had one delinquent loan at year-end, and that loss was reflected in GAAP CECL and also our year-end statutory results and included in our 2024 capital plan. So we continue to be very comfortable with our overall loan portfolio and our ability to manage through cycles. As you said that, and as I mentioned, the market is challenging, though. But with rates peaking in Q3, Q4 that should help some of the fundamentals in the business going forward.

Okay, thanks.

Your next question comes from the line of Jimmy Bhullar with JPMorgan. Your line is open.

I had a question first just on AllianceBernstein flows. Your comments on the pipeline have been pretty upbeat, but flows have been, I think, negative the last three quarters, six of the last 8 quarters and many other asset managers have had similar issues. So what are your views on the strong pipeline materializing into inflows if rates keep moving around? Or should we assume weaker flows until there's some stability in rates?

Onur from Alliance Bernstein. Definitely, we remain confident about our sales prospects. If you break our business into its three components, our retail business continues to net flow consistently. If you look at the larger segments like U.S. retail, they have grown sales for the last eight years. And we have been in organic net flows over the last five years, capturing market share. Similarly, our Asia ex-Japan fixed income franchise had a lot of momentum carrying into the new year. And we have other opportunities as well, such as strong Japanese retail equity franchise. And then on private wealth, although we had some seasonal outflows in the fourth quarter with tax cost harvesting, et cetera, which skews towards high net worth and ultra-high net worth individuals. We have been in organic net flows for the three consecutive years. And structurally, we believe we're going to benefit in terms of our proprietary private wealth business. I think where we had more idiosyncratic challenges partially influenced by some of the recent performance in a few strategies in the institutional space. Again, it's very hard to predict lumpy outflows from individual mandates. So that creates the year-to-year or quarter-to-quarter fluctuations in net flows. But if you take a long-term structural view, we remain confident in our growth engines, both from a distribution perspective, as well as the strength of our pipeline, which skews heavily towards private alts. As you know, that private alts raises the embedded fee rate in the pipeline to 56 basis points. and that's 3 times the underlying channel fees. So we have a lot of embedded revenue growth in the pipeline. We don't expect huge disruptions in terms of deployment of that pipeline, actually, we added to that pipeline in the fourth quarter, more so than we did in the third quarter and the first quarter. But also if you look at the realizations since realizations were nice, our pipeline came down. So it's good to see both the additions as well as realizing the deployments, which turns into fees right away.

Okay. And just following up on individual life. Your margins have been better the last couple of quarters, and they were obviously weaker prior to that. Do you have better confidence in results going forward, like was the early part of 2023 more of an aberration? Or do you still expect results to continue to be volatile in the short-term?

We do expect in the short-term some continued pull forward that's reflected in our $200 million to $300 million guidance for the full-year that we've given. And in Q1, that's seasonally a high flu season, also COVID lingers as well. So you could see some continued experience there. So far, we haven't seen anything, though, but that is generally a high peak season for mortality.

Okay, thank you

Your next question comes from the line of Wilma Burdis with Raymond James. Your line is open

Ye, good morning. Your '24 guide seems to imply EPS of around $6.16. Does that include or assume that interest rates go down? And if so, by how much?

All of our -- when we guide for projections, we take the forward curve as of year-end, the Fed fund rate and interest rates. So I'd point you to the forward curve, if you want to look at guidance as it related to what's embedded in our numbers. And then we also assume an equity return of with a 2% dividend yield as well. And then the sensitivities we provided in the appendix, the equities, interest rates and short-term cash sweeps.

Thank you. And then a quick one, when Equitable is novating policies to Arizona, does the policyholders have to consent to the move? Or can they approve by negative consent? I guess my question is, is there any risk that certain policies won't novate? And if so, what would that look like?

Yes. We -- just overall novation, we expect the novation process to take over two years. It's gone through state approvals now, which can vary by state. Some states do provide allows negative consent. Some states provide consent is needed. We're also undergoing the process of novating policies that were reinsured to Venerable. This has already been approved by the Iowa and New York regulators. So that's in good state. And we think it helps our broader strategy and aligns us to our peers and provides us financial flexibility going forward. So but we're quite comfortable with the process that we have, but it is a cumbersome process, state-by-state, and there are different rules state-by-state.

Just a quick one. I mean, what happens if the policyholders sold improves if they have to?

Then some policyholders would stay in New York and to operate like they are today on their internal reinsurance. But we expect the majority of the policyholders should novate over.

Thank you.

Your next question comes from the line of Mark Hughes with Truist Securities. Your line is open.

Yes, thank you. On the SCS product, it seems like you're if I'm looking at the numbers correctly, the RILA market was up about 30%, and you seem to double that. Is that a function of wider distribution, just more productivity. You're already the market leader. So I'm sort of curious whether you can sustain the kind of market share gains you've seen?

Sure. This is Nick. Look, as we articulated on Investor Day, we think we're well positioned to capture a disproportionate share of the value in that space. the reasons that you articulated. We were the pioneer in this market. Over 15 years, we've got a track record our privilege distribution, that's both third-party as well as Equitable advisers that understands how to integrate this into a portfolio. as well as our continuous innovation and thinking through new segments. I would highlight one of the advantages we have is in our innovation is given our Equitable advisers. We get feedback on what new client needs are, what advisers are looking for this drives our innovation on the product to continue to leverage this as part of more portfolios.

Then the Group Retirement, you described a net outflows in non-core channels offset by the inflows in the tax exempt market, does that dynamic continue? Or is there some inflection point where the inflows become more prominent?

Yes, Mike, as you highlight, our Group Retirement is comprised of what I would say is 3 channels, our tax exempt channel or corporate channel institutional. Within our core tax exempt business, we had positive flows for the year, $365 million, and for the quarter, $115 million, driven by new client enrollments and renewal contributions as the #1 provider of supplemental retirement than plans to kindergarten to 12th grade teachers. We benefit from the scale of our 1,000 advisers serving over 9,000 payroll slots. And we're proud that educators that work with advisers contribute 70% more and are better prepared for retirement. As a result, in that, we continue to see consistent flows, organic growth and strong ROAs. In the corporate market, we would expect -- we had good inflows. As you highlighted, we saw outflows in the noncore sort of older 401(k) blocks. I would highlight as a reminder, given our distinct model with Equitable advisers, about 25% of these outflows from this worksite model translate into individual solutions as consumers look to meet their holistic needs. Where we see the step function changes in the institutional channel, which is reported in Group Retirement and as we highlighted in the prepared remarks and some of the questions we've got confidence that we'll start to see flows here in '24. Those will be large, but lumpy.

Okay, thank you.

And your final question comes from the line of Mike Ward with Citi. Your line is open.

Thanks guys. Good morning. I was just wondering what you've been seeing in terms of the demand levels between the different annuity products and individual? I guess, maybe December, January kind of post Fed announcements, just trying to think through how we should think about that going forward?

Yes. Look, we see the demand for buffered annuities continue to grow, both of those structural reasons and the fact that people are looking for protected equity stories they move through their retirement journeys. So overall, we see continued growing demand there, driven by those structural dynamics. Traditional between -- was that also a question?

Yes. Well, yes.

Yes. And then, look, it's part of the broader portfolio we provide. We provide protected equity solutions, income solutions and tax allocation strategies. It's apparent to everyone that people are living longer and having secure income is a critical part of ensuring a secure retirement for the future. So we see structural demand continuing to grow. We continue to focus on value in parts of the market where we bring an edge and can create that sustainable value.

Got it. Thank you. And then maybe for protection, just thinking about the mix between life and non-mortality kind of group benefits. You've been posting pretty good growth. Just wondering how you how you're working on growing that non-mortality side and if you'd ever consider like a bolt-on type add there?

Yes. We love the employee benefits market because it's shorter duration, and lower tail risk as we talked about earlier in our product portfolio. We've grown that to over 800,000 lives covered. So we've seen good growth come through. It's still a small part, a few years away from breakeven. As I mentioned, the capital at the holdco provides us flexibility to be offensive its situation to rise. But again, it's had a high threshold because we need to have accretion to shareholders. So primary focus on capital allocation of the holdco, it was M&A, then it was accretive to shareholder would probably be in Wealth and Asset Management first is those are probably properties that we see more of come through. And -- but again, a high threshold given the accretion levels that we need.

Got it. Thanks, guys.

Thank you. This will conclude today's conference call. We thank you for joining, you may now disconnect your lines.