Good morning, ladies and gentlemen, and welcome to Genworth Financial's Second Quarter 2016 Earnings Conference Call. My name is Sherlan, and I will be your coordinator today. At this time, all participants are in a listen-only mode. We will facilitate a question-and-answer session towards the end of the conference call. As a reminder, the conference is being recorded for replay purposes. Also, we ask that you refrain from using cell phones, speaker phones or headsets during the question-and-answer portion of today's call. I would now like to turn the presentation over to David Rosenbaum, Head of Investor Relations. Mr. Rosenbaum, you may proceed.

Thank you, operator. Good morning, and thank you for joining Genworth's second quarter 2016 earnings call. Our press release and financial supplement were released last night, and this morning our earnings presentation was posted to our website, and will be referenced during our call. We encourage you to review all of these materials. Today, you will hear from our President and Chief Executive Officer, Tom McInerney, followed by Kelly Groh, our Chief Financial Officer. Following our prepared comments, we will open the call up for a question-and-answer period. In addition to our speakers, Kevin Schneider, Chief Operating Officer, and Dan Sheehan, Chief Investment Officer, will be available to take your questions. During the call this morning, we may make various forward-looking statements. Our actual results may differ materially from such statements. We advise you to read the cautionary notes regarding forward-looking statements in our earnings release and related presentation, as well as the risk factors of our most recent Annual Report on Form10-K as filed with the SEC. This morning's discussion also includes non-GAAP financial measures that we believe may be meaningful to investors. In our financial supplement, earnings release and investor materials, non-GAAP measures have been reconciled to GAAP where required in accordance with SEC rules. Also, when we talk about the results of our international businesses, please note that all percentage changes exclude the impact of foreign exchange. And finally, references to statutory results are estimates, due to the timing of the filing of the statutory statements. And now I'll turn the call over to our CEO, Tom McInerney. Thomas J. McInerney - President, Chief Executive Officer & Director: Thank you, David, and good morning, everyone. Today I will briefly discuss five key topics. First, our second quarter financial results; second, the progress we are making to maximize…

We'll have our first question from Ryan Krueger, KBW. Ryan Krueger - Keefe, Bruyette & Woods, Inc.: Tom, you mentioned expecting to unstack a portion of GLAIC from GLIC in the first half of 2017. Can you provide more details on what exactly you're doing there and how big that piece would be? Thomas J. McInerney - President, Chief Executive Officer & Director: So, good morning, Ryan, and thanks for your question. We've had a number of discussions with the primary regulators, and at this point we believe that they're supportive of a partial unstacking. We're still discussing the amount of that but I think the view would be that we would unstack a portion – it would be a meaningful portion upfront – and then as we hopefully continue to make progress in our LTC premium actions, we would be allowed as sales go through and improve GLIC's overall performance and financial condition, they would allow additional percentages of unstacking to go forward over time. Ryan Krueger - Keefe, Bruyette & Woods, Inc.: Would business from GLAIC be moved to a new entity? Is that how it would work? Thomas J. McInerney - President, Chief Executive Officer & Director: No, basically, right now GLIC owns 100% of the stock of GLAIC, so what we would be doing is moving the ownership – partially, the ownership from GLIC to GNA, which is an intermediate holding company. And so then, going forward whether it's dividends from GLAIC or we sold GLAIC as an option, the percentage that is owned by the intermediate holding company, that dividend or proceeds would go directly through to the parent and wouldn't get tied up or trapped in GLIC. Ryan Krueger - Keefe, Bruyette & Woods, Inc.: Okay, thanks. And then on BLAIC, do you have…

We will go next to Geoffrey Dunn, Dowling and Partners. Geoffrey Murray Dunn - Dowling & Partners Securities LLC: Thank you. Good morning. With respect to the partial unstacking on the life side, I guess first, if the process is taking longer than expected, is there any indication that you could also need to move up the $200 million that you've earmarked to help this process or should that be taken care of because you're waiting for the LTC operations to get better over time? Thomas J. McInerney - President, Chief Executive Officer & Director: Good morning, Geoffrey. I don't think the timing of the unstacking is much different. I think what we had said last quarter is we expected to initiate the unstacking by the end of the first half. We're still on that timeline, I think. We now know that it's going to be a partial unstacking and then over time we do the remaining part of that. As part of the discussions with the principal regulators on the unstacking, which are Virginia and Delaware, we have agreed to put up to $175 million of capital to facilitate the unstacking, and that $175 million, as you know, is coming from the tax payment that GLAIC made to the parent. We made that in July – I think Kelly said that in her remarks. That will – that's available to facilitate the unstacking and so we've been telling the regulators that that's about it for the amount of capital that we would put in as part of the unstacking and I think we continue to have discussions with them on that. So that's still – the $175 million that is at the parent now, based at July, so this would be in addition to where we ended June 30…

We will go next to Suneet Kamath, UBS.

Thanks. I just wanted to follow up on Geoffrey's question, just so I'm clear. Should we think about that $175 million that you have earmarked for the Life sub to be the actual flow to represent the amount that you unstacked? In other words, if you do a 50% unstacking, then only 50% of the $175 million would be put in or do you need to put it all in order to get any level of unstacking? Thomas J. McInerney - President, Chief Executive Officer & Director: So, Suneet, good question. We had committed to the regulators – Virginia and Delaware – that we would put in that tax payment. We would round-trip it from, GLAIC parent to GLIC. We still intend to do that. Obviously we were originally hopeful that we would get a full unstacking. I think now we think we've gotten to I think a reasonable place with the regulators and I understand their view that let's do a partial now and then over time – because they also, in my remarks I said, the key to GLIC's success in the future is the premium actions. We are making great progress on those. And so I think Delaware, which is the principal regulator here on the unstacking, wants to see us partial upfront and see us achieve those premium increases over time, which is the core to strengthen GLIC, and then they would do additional – we hope additional unstacking over time, but we still – we have earmarked the $175 million to put into GLIC and that's still our expectation.

Okay. Got it. And then I guess on the long-term care assumption review in the third quarter, my recollection and please correct me if I'm wrong is that as we moved over the past few quarters you've talked about the underlying assumptions actually tracking pretty nicely against, or the underlining performance – excuse me – tracking pretty nicely against the assumptions that you made when you did the reserve charges in the past. But based on the comments that you were making in your prepared remarks, it seems like maybe there's some new approaches that are going to be used, so any sense in terms of should we be expecting there to be a charge in either the third quarter or four quarter related to long-term care? Kelly L. Groh - Chief Financial Officer & Executive Vice President: Thanks for the questions, Suneet. Really we're going to go through our regular process; it's probably too early to tell on anything as we're reviewing the assumptions. And the one thing I do want to talk about, we did refine a couple of things this quarter, as you know, we did four small adjustments to our claims reserve just based on emerging experience that we had seen as a part of our enhanced analytics that we've been looking at in our hindsight testing on a quarterly basis, felt it was appropriate to record it in the quarter because we'd finalized that part of our analysis and booked it this quarter. We're still reviewing, like I mentioned in my prepared remarks, we've got an additional year of data. It has fit pretty well. Our hindsight testing has been very helpful as a part of that. But we are trying to improve the fit overall on those assumptions. We'll look at utilization rates. We…

No, that makes sense. And then just the last one for me, on the holding company cash outlook, the $200 million of dividends you expect from the International MIs, I think if I pull out what you've done so far this year and maybe that $52 million or so for the rest of the year, any color or guidance on the other pieces, whether it's the net other items or some of these derivative gains that you are able to use this tax sharing to send cash upstairs. Any color on what are the other elements of the holding company flows that we should expect for the second half? Kelly L. Groh - Chief Financial Officer & Executive Vice President: I appreciate the questions, Suneet. Like Tom mentioned, on the tax payment side, we have already received the $175 million from GLAIC related to the River Lake I and River Lake II transactions. So you will see that coming in next quarter and we've got that earmarked to facilitate the unstacking. On net other items, it's hard to predict individual legal entity taxable income on a quarterly basis. So I don't want to call it on that. We're currently not anticipating anything significant other than the $175 million that we've got coming in. And then related to dividends, you're right on. We're at $148 million on a year-to-date basis from Canada and Australia. And so, if there's additional capital actions that could be above the $200 million but we're currently planning on approximately $200 million from those two platforms. And then on the net other items, I mentioned last quarter that usually they're a little bit seasonal. And in the first quarter, there is more outflows, which then get repaid by the subsidiaries in the second, third and fourth. So that's one way to think a bit of it, but it's generally pretty small.

All right. Thanks.

We'll go next to Jimmy Bhullar, JPMorgan.

Hi. First question just on the holding company cash needs. Could you give us the numbers on what you expect for – I guess, it's the operating expenses at the HoldCo as well as interest expense over the next year? And then I had a couple other questions. Kelly L. Groh - Chief Financial Officer & Executive Vice President: Sure, Jimmy. I'll be happy to. The one thing on interest expense is, absent a significant debt buyback, it runs roughly $60 million a year. We will be resetting – I'm sorry – $60 million a quarter.

Yeah. Kelly L. Groh - Chief Financial Officer & Executive Vice President: But hang on one second. So we will be resetting rates on about half of our hybrids. And so those will go to a LIBOR floating rate, and that will be about $11 million or $12 million benefit to our annual run rate on that. So that's a feeling for interest expense. Related to tax payments, I don't have a forecast on that nor a net forecast on HoldCo expenses. But I don't think absent a large litigation settlement or something like that that we would have anything that would be terribly significant, since we do liquidate most of the holding company expenses to our operating subsidiaries.

Okay. And then on the $29 million adjustment to Long Term Care reserves in this quarter, what were the main drivers of that? Kelly L. Groh - Chief Financial Officer & Executive Vice President: Sure. I'd be happy to answer that, Jimmy. There were really four different items that we, I'll say, tweaked. When you've got over a $5 billion claims reserve, any small adjustments, obviously, are going to add up to something. And there were really four items. One was related to a calculation on shared policies for when two people share a benefit pool and really just a refinement of the reserve that we need to have up depending on who uses that benefit pool. Another one related to a change in estimate around reopened claims. So when we close a claim, what's the likelihood that that will be reopened. The third one related to a change in pending claims – that really came out of our hindsight testing and as we saw what percentage of our pending claims actually convert to a real claim. And the last one was just really actually a favorable correction that offset those three items on how we were coding marital status. So we generally see that benefits paid to married couples tend to be lower because one of the members can take care of the other for a period of time and they use less benefits. And so, we adjusted our reserve associated with marital status. So those are the four items.

And then lastly, just the environment for getting price hikes in the LTC business, has it gotten a little bit better because everybody else is doing it or are you reaching a point where you are seeing more pushback given that you've had to go to the regulators several times over the last few years? Thomas J. McInerney - President, Chief Executive Officer & Director: I think, Jimmy, it's getting a lot better. It's driven by – I think there've been a number of public hearings and others that I think more and more regulators are understanding that. I would point out – you may have read about some of this if you read The Washington Post – that the Office of Personnel Management, there's a Federal Employee LTC program and the OPM and Treasury who looked at all of that and they've approved increases of up to 126%. So I think the federal government acknowledging now that that's the case – now, obviously the employees aren't too pleased with that. But I think the Penn Treaty liquidation, again, I would encourage all of you who are interested to read the petition that's been placed before the court from Teresa Miller, the Commissioner of Pennsylvania, for the liquidation of Penn Treaty. They have about 78,000 policies. The net present value of the assets for those policies is about $445 million and the net present available liabilities is over $4 billion. So there's a net shortfall of $3.8 billion. And the principal challenge for Penn Treaty, that went insolvent in 2001, is because they never received any premium increases. So again, I think – and there's various numbers out there. The $3.8 billion shortfall isn't necessarily what the state guarantee funds will be assessed, because not all of those policies will…

Thank you.

Ladies and gentlemen, we have time for one final question. Ken Billingsley, Compass Point. Ken Billingsley - Compass Point Research & Trading LLC: Hi. Good morning. Thanks for taking my questions. I wanted to focus on U.S. MI and kind of future expectations. Given your comments on low interest rate environments and where the banks are in the process of actually making loans, it looks like the FICO score percentage of your business over 735 actually increased. So when you compare available housing, if the banks are reluctant to loan, even in this low interest rate environment, where do you see the housing market over the next 12 months to 18 months? Kevin D. Schneider - Executive Vice President & Chief Operating Officer: Ken, this is Kevin. I think we're very encouraged by the overall housing market and how that translates into the mortgage insurance market. The rates are low. It's really beginning to start kicking in and supporting the purchase market, which is the area of the market where we have a much higher penetration. We do expect there'd be some ongoing refinance volume going on, but overall, this quarter's going to come in at roughly like a $70 billion type quarter for the entire industry. And we think we're going to have a solid year going forward. A lot of pent-up demand in the marketplace is starting to come back into the market. The fact that our FICO has shifted and the mix has shifted has been net positive for us in terms of because the higher FICO business requires less PMIER capital. And so while it's maybe dragged our average price down a little bit, our returns are holding up quite well because you have less capital required for that production that you are writing. I think…

Ladies and gentlemen, I will now turn the call back over to Mr. McInerney for closing remarks. Thomas J. McInerney - President, Chief Executive Officer & Director: Thank you, Sherlan, and thanks to all of you for your time and your questions today. I also want to thank our management team and the thousands of employees that we have for their very hard work in what is a very tough macroeconomic environment in the U.S. and around the world and also for the progress that the employees have allowed us to make. We're very pleased with the overall performance in the quarter and the progress we've made on the U.S. Life restructuring plan, including achieving $150 million cash expense reduction and, of course, the additional steps we've taken to repatriate the Bermuda subsidiary. We continue to work well with our regulators and our plan to separate and isolate the Long Term Care insurance business from our other businesses, while remaining open to other financing and strategic options to address our debt and enhance long-term shareholder value. Finally, I want to thank everyone on the call today for your continued interest in Genworth. And that will conclude the call.

Ladies and gentlemen, this concludes Genworth Financial's second quarter earnings conference call. Thank you for your participation. At this time, the call will end.