Ladies and gentlemen, thank you for standing by, and welcome to the Prudential Quarterly Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Instructions will be given to you at that time. And as a reminder, today's conference call is being recorded. I would now like to turn the conference over to Mr. Mark Finkelstein. Please go ahead.

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

Thank you, Mark, and good morning, everyone, and thank you for joining us. 2016 was a solid year for Prudential, and we continue to show good momentum across our businesses. I will provide you some higher level observations on our results for the fourth quarter and full year, the underlying fundamental trends in our businesses, capital deployment, and regulation. I'll then hand it over to Mark and Rob to go through the specifics. Fourth quarter operating earnings of $2.43 per share, which excludes a $0.03 benefit from market driven and discrete items, exceeded the $2.07 we reported a year ago. Recall that we typically experience elevated expenses in the fourth quarter, which we estimate to be $0.21 per share in this year's quarter. Otherwise, results for the current quarter benefited from solid core growth across our businesses, good underwriting experience, and favorable spread income, including higher than expected non-coupon investment returns and prepayment income. Net income was $0.65 per share in the quarter or about $1.80 per share below core operating income. A closer alignment of our operating and net income and reducing overall volatility have been key strategic focuses for us over the last couple of years. With the election, we experienced significant movements in Treasury rates, credit spreads, and currencies, which resulted in mark-to-market accounting net losses for the quarter. However, the vast majority of these losses were driven by the component of our variable annuity reserve that we don't deem economic and therefore don't hedge. The net impact to earnings from other derivatives was fairly modest. I will now briefly discuss full-year results. Operating earnings, excluding market driven and discrete items was $9.65 per share for the year, or slightly below the 2016 guidance range which we established in December of 2015. ROE for the full year…

Thank you, John. Good morning, good afternoon, or good evening, and thank you for joining our call today. I'll take you through our results, and then I'll turn it over to Rob Falzon who will cover liquidity, leverage, and capital highlights. I'll start on slide 2. After-tax adjusted operating income amounted to $2.46 per share for the quarter compared to $1.94 a year ago. After adjusting for a $0.03 per share discrete item, EPS amounted to $2.43 for the quarter, up from $2.07 a year ago. Core performance of our businesses was solid in the quarter, with results benefiting from higher fees in our Asset Management and Annuities businesses, greater spread margins, and continued business growth in International Insurance on a constant currency basis. Non-coupon investment returns and prepayment income were about $65 million above our average expectations in the quarter. We estimate that this tailwind, along with the net impact of favorable underwriting results relative to expectations in our Retirement and Life Insurance Protection businesses and updates of reserves and related items in Individual Life benefited current quarter results by about $0.12 per share. In the comparison of results to a year ago, the contribution of these variable items, together with less favorable currency exchange rates had a net favorable impact of about $0.08 per share. In thinking about our earnings pattern, I would also note that we estimate current quarter expenses for items such as technology and business development, annual policy holder communications, advertising, and other variable costs were about $140 million or $0.21 per share above our quarterly average for the year, consistent with the historical pattern we mentioned when we discussed our third quarter results. On a GAAP basis, including amounts categorized as realized investment gains or losses, and results from divested businesses, we reported net…

Thanks, Mark. I'm going to provide an update on key balance sheet items and financial measures starting on slide 18. While statutory results are not yet final, we estimate that our composite RBC for our U.S. insurance subsidiaries on a comprehensive basis will be well above our 400% target as of year-end. Following the recapture of our living benefit risks and the refinements we made to our risk management strategies, most of the contract risks and supporting capital for annuities reside in our PALAC statutory entity. Therefore, we view this composite RBC position as a primary measure of our financial strength. We expect both PALAC and Prudential Insurance to separately report strong RBC positions in relation to our target as well. In Japan, Prudential of Japan and Gibraltar Life reported strong solvency margins of 858% and 975% respectively as of September 30. These solvency margins are comfortably above our targets. Looking at liquidity, leverage, and capital deployment highlights on slide 19, cash and liquid assets at the parent company amounted to $4.5 billion at the end of the quarter, an increase of about $1 billion from September 30. This reflects cash inflows during the quarter, net of the impact of about $900 million returned to shareholders including dividends and $625 million of share repurchases. Capital flows to the parent company in the quarter included roughly $1 billion from PALAC, driven by earnings from the Annuities business over the past year. We are continuing to manage the product risks on an economic basis, including the ability to maintain a CTE 97 threshold through moderate stress scenarios and we are benefiting from greater certainty of cash flows and reduced capital volatility as outcomes of the risk management refinements we implemented. We expect the more stable earnings and capital in our Annuities business to support ongoing distributions. Our financial leverage and total leverage ratios as of year-end remained within our targets. And as John noted, we returned $3.2 billion to shareholders during the year through dividends and share repurchases and announced a 7% increase in our quarterly dividend yesterday. Now, I'll turn it back over to John.

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

Certainly. And our first question will come from Erik Bass with Autonomous Research. Your line is open.

Hi. Thank you. John, just a question for you. You've talked about the steps to reduce reported volatility including the changes to yen accounting and the VA captive. I think with the market moves this past quarter, below the line noise has re-emerged as a concern for some insurance investors. So are there any other initiatives you are contemplating to kind of further reduce some of the non-economic noise in PRU's results?

So I think I'm going to suggest, Erik, that Rob take that question. Rob?

So, Erik, this is an ongoing initiative for us. When we look back over the last four, five, six years, we identified that the two primary sources of breakage for us between our reported GAAP results and the operating earnings that we share with you came from the FX remeasurement issue that you alluded to and then from our Annuities business. And so we have undertaken initiatives to solve for the, I'll say the 80% to 85% of the noise that's been created over the last couple of years. Within our Annuities business, we haven't finished, but we've gotten substantially there. So we are continuing to do some work in order to take out some of the remaining volatility, some of which you saw this quarter. And then there's the remaining 15% to 20%, and yes we have identified initiatives there that we think may help to eliminate that. So, we care a lot about cash flow. We also recognize that GAAP matters to investors and it matters to the creation of book value growth, and so we continue to stay on that.

Thank you. And then I think you have also recently made some pricing changes for both the PDI product and VAs and then some Individual Life products. With interest rates now moving somewhat higher, how do you think about the trade-off between higher new business margins and adjusting pricing to make the products more attractive to consumers and drive more sales?

Erik, it's Steve. I'll take that part of your question. We're always looking to strike the right balance between the factors that you mentioned. For example, our – this quarter's sales in Annuities reflected the fact that Mark spoke about. At the end of the third quarter, we had a trimming of the benefit in our PDI product, and that resulted from reduced sales throughout the quarter. However, we have a highly distinctive capability, distinctive in the industry in our Annuities business to reprice both PDI and HDI as often as monthly, and so we do have the ability to respond to market developments and to act nimbly in our balancing of the factors you mentioned. In fact, on PDI, we already took a modest step in that direction at the very end of the year, increasing some of the payout rates. And as and when market conditions allow us to continue that path, we will do so. We're always looking to write business on a sustainable and profitable basis.

Got it. Thank you.

Thank you. Our next question comes from the line of John Nadel with Credit Suisse. Your line is open. John M. Nadel - Credit Suisse Securities (USA) LLC: Good morning, everybody. I guess a broad question, but with the move higher in rates – and I realize we're sort of flat year-over-year, but certainly higher since the election. As you think about where – how much more do we need to go I guess globally to get to sort of a blended stability on your portfolio yield?

So, John, it's Rob. Let me take a stab at that. The way I would think about it is, I'd look at the comparison of our portfolio yield to new money rates and then use that as sort of a metric for – we want to get to the point where the roll-off in the portfolio is not creating further drag on the overall yield by virtue of where we can invest. In the U.S., our new money rates are around 3.5%. The portfolio roll-off in the course of the next couple years is going to be 4% to 4.25%, somewhere in that order of magnitude. So we got about another, call it another 75 basis points of interest rate rise between a combination of underlying Treasuries and credit spreads in order to close the gap between where we're putting new investments on the books and where old investments are rolling off the books. If you look at the Japan portfolio, recognizing that that is a mix of both U.S. and yen liabilities, the portfolio yield there is around 3% and our new money rates are around 2.5%. So we've got a little over 50 basis points of negative yield there that we have to make up. That would come from a combination of both rising rates in the U.S. and rising rates in Japan. John M. Nadel - Credit Suisse Securities (USA) LLC: That's really helpful. Thank you. And then I guess my follow-up question is – and focusing on a couple of the below the line items, the impact from the divested businesses this quarter, would you characterize that impact running through net income as also largely non-economic? And if so, what drove that?

Yeah, so – yeah, we would think of that being entirely noneconomic. The divested businesses, the primary drivers are going to be two things. One, our Closed Block Business, and that is entirely non-economic in that the result of that business over time are passed through to the policy holders. So it has no economic impact to the shareholders of the company. The second item in there is our long-term care business, and what you saw in there was actually – from an operating standpoint, it's generating modest profits as you would expect, given when we wrote down the book. It's generating profits that from – from an underwriting standpoint and from the earnings that we get off our surplus that we have in that business. But you have the – there are a certain number of derivatives that are managing – that are helping us to manage the portfolio there, because it's a very long liability and you've got a mark-to-market on those derivatives as interest rates rose. So the entire loss you saw within long-term care in fact is more than attributed to the mark on that derivative offsetting the modest level of profits we are otherwise getting out of it. So we would consider that to be non-economic therefore as well.

Yeah, with no corresponding mark on the liabilities.

Yes, sorry. Thanks, Mark. John M. Nadel - Credit Suisse Securities (USA) LLC: Yeah, understood. And, I mean, I understand that there's some work going on at FASB around that. Is that your understanding as well? And if so, I mean, any guess on how long it takes to get to the point where we get a little bit closer to matching up the impact on the left versus the right side of the balance sheet?

Well, FASB has a proposal out which would go in the right direction. So the initial proposal out by FASB would now include a mark-to-market concept on both the left and the right-hand side of the balance sheet, which I think would be helpful and as I said, a step in the right direction. The concern that we have is that the details matter on how you go about doing that. And so, you don't want to solve for that problem and then create other volatility and non-economic outcomes by virtue of getting the discount rates wrong that you're using on the asset side and the liability side. So there are a number of issues that we have with the FASB proposal, so we think it's generally headed in the right direction. We think it needs some fine-tuning in order to get it quite right so that – so in fact the new proposal is a net good as opposed to trading one level of noise for a different level of noise. John M. Nadel - Credit Suisse Securities (USA) LLC: Thanks very much. I appreciate it.

Thank you. Our next question comes from the line of Suneet Karnath at Citigroup. Your line is open.

Thanks. Good morning. I just wanted to start with the ROE. Going back to the outlook call, where you took the guidance for the near-term down from 13% to 14% to 12% to 13%. I think you had said that the primary driver of that was rates, although there were some other factors. But I'm trying to reconcile that 100 basis point reduction in ROE guidance to the interest rate sensitivity that you show in the same deck where I think you said a 100 basis point increase or swing in ten-year Treasuries is only a $0.15 to $0.20, and that's a pretty modest impact on ROE. So I'm just trying to reconcile the two.

So let me take a stab at that, Suneet. The effect of interest rates is a compounding effect, and so when we first established our 13% to 14% outlook for ROE, it was a point in time where interest rates were about 100 basis – our outlook for interest rates were about a 100 basis points higher than they are today. We've had several years now of rates being below that expectation, and it's the compounding effect of that every year as the portfolio rolls and as we're putting on new business and making new investments, that leads – that created the drag on the ROE. And so, by contrast it will then, therefore, take us a couple of years of interest rates being back up at 100 basis points in order to build back to what we think is that longer term sustainable ROE of 13% to 14 %. Does that help?

Yeah, that does. I just was wondering, is another factor in there this recurring premium products that you sell in Japan just given that rates have had such a big move to the downside in that country?

Let me take one stab at that, and then if Charlie wants to add any commentary, he can. Obviously the impact on our returns are felt both in the U.S. and in Japan. So, yes, we are seeing lower rates in Japan across our products. So those products where we were more rate sensitive, we view the – done pricing adjustment or we've discontinued sales of that – of those products. I would note, however, that our returns in Japan are actually quite competitive, and so we have a very high ROE out of our Japan business, and therefore the compression that we felt with – as a result of lower rates in Japan, while it's had a negative impact, we still produce very attractive returns there. Charlie, I don't know if you wanted to elaborate on that.

No, I think you do – I guess the only thing I would – I'd kind of add two points to this. I think the real driver of our ROE is our business mix. And there are some factors, interest rates, et cetera, that have some effect over time, but you've seen us when we came out of the financial crisis articulating 13% to 14% and then exceeding that when we had the wind at our backs, but we also – we never raised that goal because we knew we were benefiting from tailwinds. We didn't want to chase returns, so we want to preserve our ability to invest in our business in ways that didn't always have an immediate positive effect on ROE. We have continued to think exactly the same way, and if we find the interest rate environment is a sustainably more favorable one, our business mix is going to drive stronger outcomes. And in the meantime, actually our biggest focus around this also is relative performance. We think our business mix should drive superior performance in relationship to our peers, and that's been historically reflected and we would expect that would continue on from today.

That's helpful, John. Just second question, just a follow up I think on Erik Bass's line of questioning in terms of the below the line noise. Was there any impact from those items on your statutory performance in the quarter, or was it all GAAP?

So the mark-to-market on derivatives will affect both GAAP and statutory. For us, that derivative impact was relatively modest. I'm talking about the portfolio management derivatives. The noise that got created as a result of the Annuities business, the non-economic component of the liability and the NPR that offsets that non-economic component are outside of our statutory construct. So our statutory construct isn't identical to, but largely mirrors the economic construct that we have put together from a GAAP standpoint. So that portion of the noise which dominated the delta between reported operating earnings and GAAP is entirely non-economic in both a GAAP and a statutory context.

Got it. How big was that marked number that you just referenced that will affect stat?

The derivatives piece, I don't know that we have disclosed that, but it was not a particularly material number. Our net derivatives are relatively modest from a duration standpoint. The notional amount we have outstanding there has been substantially decreased over the course of the last several years. In fact, it's like half what it used to be a handful of years ago. We've been encouraging our portfolios as they do their ALM to increasingly utilize cash instruments over derivative instruments, so was not a particularly material impact.

Okay. Thank you.

Thank you. Our next question comes from the line of Ryan Krueger with KBW. Your line is open. Ryan Krueger - Keefe, Bruyette & Woods, Inc.: Hi. Thanks. Good morning. I had a question for Charlie. Can you talk about the potential impact to Japan sales ahead of and following the April discount rate reduction?

Sure. So as you know, in July of last year, the standard valuation interest rate for the yen single premium whole life products decreased to 25 basis points, and we think potentially in April of this year, the discount rate for reserves for recurring premium product will decrease from 1% down to 25 basis points. Our view is that we have adapted in the past in terms of pricing and products and we'll continue to do so in the future. So, we don't anticipate a meaningful impact on our capital levels or solvency margins. For example, we have already discontinued all our Japanese yen single premium whole life offerings through all our channels. We did that last year. And don't forget that this new change in discount rates will only apply to new business. So we should be able to manage the efforts of the new rules. It may involve some repricing of products as we go forward, but we'll take that as it comes. Ryan Krueger - Keefe, Bruyette & Woods, Inc.: And then somewhat related, have you seen any domestic competitors start to offer more U.S. dollar denominated products, or is it more isolated to the international competitors that operate in Japan?

We have seen – we have seen some – or we have heard a fair amount of talk about it, and we're beginning to see a little of it. But the way – where we have seen it has been primarily in the bank channel. So we think there will be more competition in the future, but let's – let's review the bank channel for a minute, because I think it's quite interesting. So for us, the bank channel is about – it's less than a quarter of what we sell. Obviously most of what we sell is through our tied agency systems with Life Planners and life plan consultants, and most of what we sell is death protection. So two-thirds of what we sell is death protection. And where we're seeing the competition come in is not so much on the recurring premium product, especially recurring premium U.S. dollar product. We really haven't seen any competition from anyone there yet. We have seen a little bit on the single premium U.S. dollar product, and we have seen some on the recurring premium yen denominated dollar product. But – and we don't sell any more single premium yen denominated products. So we have seen some come in and will probably see a little bit more, but we also think we have a competitive advantage when it comes to selling death protection, either through the bank channel or through our tied agency system. Ryan Krueger - Keefe, Bruyette & Woods, Inc.: Okay. Thanks a lot.

Thank you. Our next question comes from the line of Tom Gallagher with Evercore. Your line is open.

Hi. First, just a follow-up question to Rob. I think you mentioned new money yields related to the Japan portfolio is running at around 2.5%. Is that – can you split that up between how much of your cash flows you're – being invested to back the U.S. dollar portfolio versus how much is being – is backing the yen portfolio? That just seems like a high number relative to at least yen cash flows.

It's a good question, Tom. I don't have those numbers off the top of my head, so it's something we'd have to follow up with you on. I think we do provide that. I just don't have it immediately at my fingertips.

Let me just – let me throw out a couple of numbers. And so if you look at our whole portfolio, about 45% is JGBs, and then there's about another 25% that's probably Japanese corporates, and then you have – then you have U.S. product as well. So when you look at our overall portfolio, it's really high quality. So you have 45% that's JGBs, you have 85% that's fixed income, you have 97% of that is investment grade, and of the other 15%, it's really investment grade surrogates, right. So that's where you get some other U.S. dollar product; you get private placements, you get mortgages, you get other things. So in general, it's – one, it's a very high quality stable portfolio; and two, you have a fair proportion of U.S. dollar product in there. And that's what raises the yield.

So, well, Charlie bought me some time. I was able look up the – look up some numbers for you. So if you look at the total international portfolio, call it around a $175 billion, about $100 billion of that would be in yen products and about $75 billion of that would be in other currencies, primarily in U.S. and Aussie dollar.

But at the margin, more U.S. dollar business is coming in.

Yeah. That's a good point.

You heard the numbers I quoted on the mix of sales, and U.S. dollar sales are now the majority. So we've – you've got like – I think the non-yen denominated sales in the last quarter were over 60% of our sales, and so when you think about the incremental dollar flow it's going to be more heavily influenced by sales because we've got a fairly modest turnover in the existing portfolio, given the very long duration of those liabilities.

Okay. And then how much of the yen cash flows that are coming in are you pivoting more into U.S. dollar investments, like – I don't need precise numbers, but are you – if you've been investing 20%, 50% of yen cash flows into U.S. dollar or non-yen type investments, or is it something much smaller than that?

We have a relatively small portfolio, Tom, that's invested in – where we have taken yen liabilities, invested in dollars, and then swapped back to yen, which I think is the strategy that you're talking about. The aggregate of that portfolio is about $5.5 billion. When we first started that, it was a very attractive trade. We were earning 2%, 2.25% in premium over what we could earn if we invested in Japan. Today, that's more like 1.5%. So we continue to selectively pursue it. But it's a – I think our CIO has referred to it as getting to be a little bit of a crowded trade. So we have some of that, but relatively modest.

Okay. And then just final question. Rob, in response to, I think it was Eric Bass's question, you were talking about an effort to eliminate the below the line noise and strategies. Can you just expand a bit on that? Would it be significant altering of economics, or are we talking about accounting, legal entity type restructuring where you think you can actually optimize the accounting better without changing the underlying economics much?

Yeah, Tom, we seek to do this without compromising on economics. I think what we did with FX remeasurement is a perfect example of that. What we did is we – we created a divisional structure within Japan in order to create three functional currencies which then allowed us to eliminate the FX remeasurement issue that was giving rise to – was occurring as a result of having a single yen denominated functional currency there. So when we look at eliminating that noise, what we're trying to do is look at uneconomic noise and pair that – and figure out – or uneconomic ways – non-economic ways of reducing that noise such that we don't impair the underlying fundamentals of – and economics of our business. And we think there are levers that allow us to do that.

Okay. Thanks.

Thank you. Our next question comes from the line of Seth Weiss with Bank of America. Your line is open. Seth M. Weiss - Merrill Lynch, Pierce, Fenner & Smith, Inc.: Hi. Thank you. A question on the Retirement and the Asset Management businesses. If you strip out what you consider trend adjustments, Retirement's quarterly run rate appears right around $260 million. There's a significant step-up than where you've been. You commented on some of the fund flow dynamics earlier in the call. Just curious if you could speak to what you think is a sustainable level of run rate quarterly earnings.

Seth, it's Steve. I'll address your question and talk about how we view trends in core earnings in both of those businesses. First of all, in both businesses, particularly in Retirement, earnings benefited from some items that aren't necessarily trendable as Mark addressed in his review of business results. However, we have seen core progress in the Retirement business, I would say that that core progress very much reflects higher account values in both PRT and Full Service arising from a variety of factors: our sales, our flows, persistency of our business, and in some cases market appreciation. We have seen it reflecting a effective expense management over the course of the year, and we have seen – we have seen it reflect the benefit of portfolio rotation as we onboard PRT transactions. And what I mean by that is, for example, as we onboard these transactions, we're taking in large amounts of public fixed income assets and we're able to rotate some of those to private fixed income, picking up some yield while still matching the liability very well and not increasing any risk. In the Asset Management business, I would say our core growth in earnings reflects two very basic trends. One, obviously the strength of our flows; and, two, our ability to sustain our fee level on an average basis across the entire platform. Now, that's fairly distinctive, and it's encouraging to us in the sense that even while we're in a period where there's secular pressure on asset management fees, the strength and the diversity of our multi-manager structure and our ability to draw flows in some higher yielding parts of the business, higher fee basis parts of the business has on an average basis enabled us to hold our average fee levels pretty steady. So I would say we are encouraged by the trends in core earnings in both of these businesses. At the same time though, I would say that that progress is reflected in the guidance that we issued in December. Seth M. Weiss - Merrill Lynch, Pierce, Fenner & Smith, Inc.: Great. And on Asset Management you specifically commented on fee rate modifications for certain real estate funds. Does that have a notable improvement in the run rate?

It's – it has a double digits impact over the – double digits of dollars over the course of the – over the full year. Seth M. Weiss - Merrill Lynch, Pierce, Fenner & Smith, Inc.: Great. Thank you.

Thank you. Our next question comes from the line of Nigel Dally with Morgan Stanley. Your line is open. Nigel P. Dally - Morgan Stanley & Co. LLC: Great. Thanks. Good morning. I had a question on Annuities. The flows deteriorated a fair amount and you highlighted the reasons why. If that continues, I'm guessing the capital strain will be lighter. Would be that be meaningful enough to add to your available capital? Any color on implications to capital would be helpful.

Nigel, it's Rob. I'll take a stab at that. As a result of – you know what? Let me actually – let me step back a little further. Because I think what this really relates to is the success we had with our restructuring of the Annuities business, and maybe it's worth just going through that real quickly and then it leads to sort of the results that I'll describe to you that will answer your question directly. So remember, we did four things when we undertook this restructuring of our Annuities business. First, we took all of the operations that we had and we consolidated them into a more limited number of legal entities primarily, one being PALAC. Two, we eliminated the corporate underhedge. Three, we migrated toward a statutory construct that we think is more reflective of the long-term nature of the risks, and consistent with where the NAIC is going, consistent with our methodology for managing to the CTE 97 that we – through the cycle that we've historically had in place and consistent with our desire to have AA ratings. And then the fourth thing that we did is we used a combination of derivatives and financial assets to defease the liability, whereas before we were using primarily if not exclusively, derivatives. The immediate results of that were that we have reduced our capital sensitivity to interest rate risk, which has resulted in a stable and higher level of free cash flow – getting to the question you're asking – that enables us to have more confidence around our ability to pay dividends and hence what you saw in the fourth quarter was a $1 billion dividend coming out of our Annuities business. We think that going forward, we have – that is a high cash flow business, and when we have reduced the volatility around the business we have more comfort then in distributing that cash flow out to the parent company and ultimately making it part of our re-deployable capital. That was on top incidentally of, just to remind you, releasing about $1 billion as a result of the combination, $0.5 billion of which we distributed out to shareholders as a special authorization last year. We used the other $0.5 billion to reduce our debt and our leverage. Incidentally, its also led to lower costs. So we have lower risk, lower costs. That's improved AOI coming out of the business as well. So that volatility reduction and capital release and increased earnings all facilitated by the efficiencies coming out of the restructuring, we think enables us to take advantage of what we believe are the very attractive economics in that business, which is high return, high cash flow. The introduction of stability then allows us to translate that into cash flows to the parent company, and as I said, ultimately to shareholders as well.

Nigel, this is Steve. I'd kind of amplify Rob's remarks and speak to your comment about – kind of implied in your question about how we see future sales. First of all – and I'd address it on a product basis. First of all, as I mentioned, our current products, we have the ability to be very nimble on how we keep those competitive. In terms of our forward-looking product plans, these really stem from our business strategy and not from any particular outcome one way or the other on the DOL rule. Our product plans in 2017 and 2018 are simply a continuation of that strategy that's already been successful in 2015 and 2016. We look to operate broader range of solutions to client needs. For example, in the first half of this year we'll enhance our death benefit in a way that will make us more competitive in legacy planning. We're exploring new fixed index annuity solutions, and we're looking to develop and introduce a highly innovative and simplified income solution into the Group benefits market that will enable us to address a broader market segment. And again, all of these are grounded in our business strategy and aren't sensitive to outcomes one way or the other on the DOL fiduciary rule. Nigel P. Dally - Morgan Stanley & Co. LLC: Very helpful. Thank you.

Cynthia, I think we have time for one more question.

Certainly. And that will be from the line of Yaron Kinar from Deutsche Bank. Your line is open.

Good morning, everybody. I had a question around the U.S. dollar denominated product sales in Japan. How much room do you have to continue to grow that, or is kind of this roughly 60% of overall product sold where you want to be?

No, I don't think – I'll answer that in a couple of ways. The first is, I don't think we have a set goal as to where we want to be. And we try and – just as Steve articulated, in the U.S., we try to provide solutions to our clients, whatever they may be. And that may be in yen product, it may be in dollar product. And also, as Steve said in the very beginning, you look at a balance; you look at a balance between product mix, pricing, and what the consumer wants. So we don't have a goal per se. And the answer is different for the different companies we have there. So in the Life Planner, as an example, U.S. dollar sales increased from 38% this quarter from 27% a year ago. So there's a lot of room to move there. In Gibraltar, we're a little bit higher. So overall, Gibraltar, the U.S. dollar sales are 67% versus 50% a year ago. In Life Consultants, they were 55% so there's room – there's certainly room there. The bank channel, we are higher; we sell mostly U.S. dollar product because we have eliminated the single premium yen denominated product. And so there isn't as much product on the yen side to sell, and that had to do with the profitability and frankly the efficacy of that product. So U.S. dollar product there was in the 80s; so not quite as much room to grow there, although a little bit. And then in the IA channel, we're at about 50%, which is up from about 30% a year ago. So by giving you these numbers, you see a couple of things; one is our ability to pivot products, and two is the creation of new products because one of the reasons why we were able to sell more dollar denominated product is because we created some new products, especially on retirement income and some whole life products. So I think you'll see we have the ability to do more as we go forward through either product creation or just through the absolute percentages.

That's helpful. And do you know what percentage – or do you have handy what percentage of your U.S. dollar denominated products are single premium?

Oh, single premium? I don't offhand. I will tell you that overall in Japan, 86% of our product is recurring premium. Of the other 14%, 11% is the fixed annuities business, and the fixed annuities business is almost all U.S. dollar. So I would say – I'll give you those two percentages. We can get back to you with the actual percentage. But I'll leave it at that.

Okay. Thank you very much.

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