Good morning and welcome to the Voya Financial Fourth Quarter 2014 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Participants are limited to one question and one follow-up. Please note this event is being recorded. I would now like to turn the conference over to Darin Arita, Senior Vice President of Investor Relations. Please go ahead.

Thank you, Emily, and good morning, everyone. Welcome to Voya Financial’s fourth quarter 2014 conference call. A slide presentation for this call is available on our website at investors.voya.com or via the webcast. Turning to Slide 2, on today’s call, we will be making forward-looking statements. Except with respect to historical information, statements made in this conference call constitutes forward-looking statements within the meaning of federal securities laws, including statements relating to trends in the company’s operations and financial results, and the business and the products of the company and its subsidiaries. Voya Financial’s actual results may differ materially from the results anticipated in the forward-looking statements as a result of risks and uncertainties, including those from time-to-time in Voya Financial’s filings with the U.S. Securities and Exchange Commission. Voya Financial specifically disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise. Slide 2 also notes that the call today includes non-GAAP financial measures. In particular, all references on this call to ROE, return on equity; ROC, return on capital; or other measures containing those terms are to ongoing business adjusted operating return on equity or ongoing business adjusted operating return on capital as applicable, which are each non-GAAP financial measures. An explanation of how we calculate these and other non-GAAP financial measures and the reasons we believe they are useful can be found in the quarterly investor supplement available on our website at investors.voya.com. Reconciliations to the most directly comparable GAAP measures are included in the press release and the quarterly investor supplement. Joining me this morning on the call are Rod Martin, Chairman and Chief Executive Officer of Voya Financial; Alain Karaoglan, Chief Operating Officer; and Ewout Steenbergen, Chief Financial Officer. After their prepared remarks, we will take your questions. With that, let’s go to Slide 3, and I will turn the call over to Rod.

Thank you, Darin, and good morning. We’re excited to share with you our 2014 results and our plans for continued growth and value improvement. Let’s begin on Slide 4 with some key developments. First and most noteworthy, we’ve achieved our overall 12% to 13% ROE target two full years ahead of our plan. Our 2014 ROE of 12.1% is 180 basis points higher than 2013 and 380 basis points higher than 2012. The transformation that we’ve achieved in just two years has been quite meaningful. We’re pleased with the financial, cultural and operational improvements that we’ve made and the track record we have established. Our success is due to our talented people, our commitment to executing on our plans and our relentless focus on our customers. We’re now focused on continuing our momentum, raising the bar, and achieving our vision to be America’s retirement company. In connection with this, we are establishing a new run rate ROE target of 13% to 14% for full year 2018. To achieve our new ROE target we will continue to drive improvement in each of our businesses. We also plan to strategically invest an incremental $300 million to $350 million over the next four years to develop next generation customer experiences and solutions. In a moment, Alain will provide you with an initial view of our investments. Briefly, I would like to say, these will ultimately help drive ROE expansion, increase free cash flow, and accelerate earnings growth. With the improved returns that we’ve achieved in our ongoing businesses and the significant excess capital we are generating we are excited about the future. Driving shareholder value is one of our prime objectives. In 2014, we utilized almost $800 million in excess capital to repurchase common stock. This included $175 million in the fourth quarter…

Thank you, Rod, and good morning. Turning to Slide 9, we reached our 2016 return on equity target of 12% to 13% this year. That is two years ahead of our plan. Our return on equity was 12.1% for 2014. That is up 180 basis points from 10.3% in 2013. When you remove items that we do not expect to recur at the same levels, our return on equity improved 190 basis points to 11.7% from 9.8%. Our return on capital reached 9.9% in 2014. That is up 130 basis points from 8.6% in 2013 and very near our 2016 target of 10% to 11%; when you remove items that we do not expect to recur at the same levels, our return on capital increased by 140 basis points to 9.6%. On Slide 10, our margin growth and capital initiatives have contributed to the return on capital improvement since 2012. First, our margin initiatives were the primary drivers contributing 182 basis points. Initiatives here include re-pricing actions, running off less profitable assets and aligning costs with lower levels of sales in certain capital intensive products. Also through 2014, we achieved approximately $70 million in cumulative cost savings as part of our plan to realize $100 million in cost savings by 2016. Second, our growth initiatives contributed 190 basis points. This is primarily due to growth in retirement and in Investment Management. Third, our capital initiatives contributed 55 basis points. These include reinsurance actions and progress with shifting the composition of our portfolio to be less capital intensive. Fourth, the headwind of low interest rates negatively impacted our return on capital by 69 basis points. And as you know, the impact of low interest rates was factored into our plans. Included in the 270 basis points of return on capital improvement,…

Thank you, Alain, and good morning, everyone. Today, I will highlight some of our key financial metrics for the fourth quarter of 2014. Moving to Slide 18, you can see the items that affected our fourth quarter results relative to the third quarter. In addition, we will discuss business specific drivers. Higher prepayment income partially offset by lower alternative income affected several segments. Retirements benefitted from increased fee income and annuities had favorable mortality. In Investment Management, we have higher performance fees, which helped to offset higher operating expenses. In addition, we recorded lower investment capital results, due to changes in value on certain private equity investments. In Individual Life, there was favorable mortality driven by lower severity. In Employee Benefits, the loss ratio for Stop Loss continued to benefit from favorable claims development. We also had several below the line times. We recorded $1.85 billion release of the tax valuation allowance on our deferred tax asset for the full year 2014. And I will address this in more detail shortly. We also recorded a pre-tax $373 million loss in the fourth quarter related to our pension plans due to lower rates and the impact of updated mortality tables. We will use a fair value methodology to account for our pension plan. This approach recognizes non-operating gains and losses in the current period rather than amortizing over a multi-year timeframe. And in Individual Life the pre-tax impact related to the closing of the RGA reinsurance transaction was $71 million in the fourth quarter. We had already recorded $18 million in the third quarter due to accounting rules. Looking ahead, there are some factors worth nothing that we expect to affect our overall business and our individual segments. All of our segments are impacted by seasonal items in the first quarter…

Thank you. We will now begin the question-and-answer session. [Operator Instructions] As a reminder, participants are limited to one question and one follow-up. At this time we’ll pause momentarily to assemble our roster. Our first question is from Ryan Krueger of KBW. Please go ahead.

Hey, thanks, good morning. Ewout, I want to follow-up on the comments you made regarding the 2015 earnings outlook just to make sure I heard it correctly. You said you would expect the ongoing earnings in 2015 to be similar to 2014 on a pre-tax basis. Is that correct?

Ryan, good morning. So what we have tried to say during the prepared remarks is the following. We have several moving elements in our results. If you look at 2014, ROE of the company, especially if you start to normalize for the alternatives and prepayment income, as well as for the higher performance fees in Investment Management, would expect that to normalize in 2015, which you can say there is an offset to that, because we expect the of the life reinsurance transaction with RGA to come in gradually over time. If you then layer in on top of that, the additional investments on the strategic initiatives that Rod and Alain explained, but also factoring the lower effective which we will start to apply from the first quarter of 2015. Then the ROE year-over-year we expect to be more or less neutral. I hope that helps, so it wasn’t specifically on operating earnings, but it was to give some guidance, some expectation with respect to the - how the ROE might evolve year-over-year if you take all of those elements into account.

Okay. Got it, understood, thank you. And then the 13% to 14% new ROE assumption for 2018 does that also assume 32% operating tax rate?

Yes, that’s included in that underlying assumption.

Okay. And then just last one. You show your excess capital at the subsidiaries to be over $1.5 billion in excess of your target. Can you talk about your expectations for how much of that you think you can send up to the holding company in 2015?

Ryan, great question. So of the excess capital on the statutory basis in our operating entities over the RBC level of 425%, we expect that $1.5 billion, approximately $900 million is available in ordinary dividend capacity, which we’re planning to take out of the operating entities after the filing of the blue book, so probably in the May timeframe. Then the remaining $600 million is not available in ordinary dividend capacity. And after the May timeframe, we will continue to work on solutions to get also debt excess capital to the holding company, and we are confident that we will find ways to do so. So ultimately, the full $1.5 billion we are planning to take to the holiday company, but it will probably be a two-step approach, ordinary dividends of $900 million and then other actions to take the additional $600 million to the holding company. Ryan Krueger - Keefe, Bruyette & Woods: You do think you can get all of that in 2015 up to the holding company with those two combined actions?

That is absolutely the objective from us as management. Ryan Krueger - Keefe, Bruyette & Woods: Okay, great. Thank you.

Our next question is from Tom Gallagher of Credit Suisse. Please go ahead.

Good morning. The main question I had is the excess capital versus last quarter, I think it went up by $300 million, what was the, if I add up the excess in the subsidiaries plus the excess of the whole curve. What was the main driver? Was that just statutory earnings?

There are two elements here. If I look at the improvement of the RBC ratio, there was approximately operating statutory earnings of $400 million in the entities, sorry, after tax operating income was $285 million and that includes the hedge losses, net income on a statutory basis was $330 million. We also saw a decline in the required RBC, so the company action level at 425% level of approximately $120 million. So it was both the combination of statutory income and a decline in required capital. Also, please keep in mind that the benefit of the RGA reinsurance transaction, which closed in the fourth quarter, is also reflected in those numbers, and that benefited both income as well as required capital in the same period. The holding company cash position improved, so if we speak about excess capital, we look both at the excess capital in the operating entities, as well as the holding company cash position and that improved based on tax sharing that was done from the operating entities to the holding, ordinary dividends we were able to take out of our Connecticut entity some dividend from our investment and management entity. There were some interest expenses and there was a buyback as you know, so combination of that drove the cash at the holding company up.

Ewout, that’s clear. The tax sharing payments and the utilization of the DTA, I think that had been running at a little over $100 million a year, is that expected to grow or how do you see that playing out in terms of the usage in the cash that’s going to provide?

That’s a very complicated question, because there are many moving parts that will impact the actual tax-sharing payments from the operating entities to the holding, as well as what the holding needs to settle with the IRS. So it’s very hard to give a precise guidance on this. What I can tell you is that the tax-sharing payments during the fourth quarter to the holding were $216 million and that was helped by the closing of the reinsurance transaction, so that triggered an addition of tax-sharing payments to the holding. The holding has to settle a part of debt in 2015, but exactly how those numbers will move around year-over-year, it’s hard to give very precise guidance.

Let me ask you this way then, the net present value update you gave in terms of the value of the DTA, is there a way we can revere engineer it and what are the cash flows that are embedded in that net present value calculation?

Thank you for asking that question, Tom. So we have, indeed, updated those net present value calculations. And you have seen that there is a slight increase of those net present values, that’s based on the increased life deferred losses driven by some hedge loss movements and gains by the CBVA during the year itself. What we also have tried to do is now to spike out the benefit of the dividends received deduction. So one-third of the dividends received deduction relates to the ongoing business. And that’s why we have adjusted the effective tax rate assumption for the ongoing business of 35% to 32%. But then we forget that two-thirds of the DRD benefit relates to the closed-block variable annuity. So that’s why we have separately indicated that in respect to the new net present value calculations for the cash benefits of the usage of the deferred tax assets. So if I look at the best estimate for payment and settlement to the IRS, we have to do in spring of this year. It would be probably somewhere in a $70 million range, that has to do with a gain, we have triggered on that life reinsurance transaction. But, again, that’s offset by higher tax-sharing payments we’ve received from the operating entities and that provided that number already to you that was $262 million. So I hope that gives a bit of guidance about how much do we get up from the operating entities. How much do we need to settle with the IRS and the difference therefore is a benefit for the holding company as an overall net effect of all of those cash tax streams.

Okay. I can follow-up on details later. Thanks.

Our next question is from Erik Bass with Citigroup. Please go ahead.

Hi, thank you. I had a couple of questions on the $300 million to $350 million of investments that you are making. And so what should we be thinking about for the payback period and the P&L impact of the investments? And then also should we think about this as a use of free cash flow?

So as we have highlighted $300 million to $350 million, Erik, are going to be investments over the next four years and these will be expenses. So ultimately, it will affect the free cash flow, but you have to tax affect them, take them [indiscernible], but these are expenses. When you - we will talk a little bit more in detail on our Investor Day on our expectations for that. But ultimately, our expectation is to achieve a higher return on equity in 2018 of 13% to 14%, but importantly to enhance our customer experience, simplify our IT, and allow ourselves to grow as fast as we can at this higher return on equity level. And so in terms of the details on how which year is going to affect, as Ewout mentioned in 2015 in his numbers, the assumption was around $50 million this year.

Got it. So we should think about, isn’t it?

Maybe - this is Ewout, if I may react on the second part of your question, so obviously those investments will have an impact on the available free cash flow of the company. Nevertheless, we reaffirm our conversion of GAAP operating earnings to free cash flow of 60% to 70%. So we expect even with those additional investments in those strategic initiatives to still be able to have a conversion of 60% to 70% of our GAAP operating earnings to free cash flow over the few years.

Got it. That’s helpful. And then can you talk about what your plan assumes for interest rates and how to think about the sensitivities if rates were to remain at 2%?

Erik, I can give you some guidance with respect to the baseline of the assumptions. And specific sensitivities and so the sensitivity runs, we have not done at this moment and we will be able to give you more insight to debt during the Investor Day in June. But with respect to the baseline calculation and projections, the assumptions are the following, the main assumption with respect to the equity development is 7.5% annual market depreciation on the equities. And then with respect to the interest rates, we have assumed the forward curve as of the end of 2014, rates have fallen as everyone is aware at the second-half of last year, but also the forward curve has further flattens. And we have seen at the same time a widening of credit spreads, so all of that has been factored in. So we are not pretending to be smaller than what the market is implicitly assuming in terms of what rates will do, and we have assumed the forward curve in respect to rates development as of the end of 2014.

Got it. Thank you.

This is Rod, if I could just add, it’s a similar methodology, obviously the point in time is different than we did when we originally introduced the ROE walk in the beginning of the 2012. So the same fundamental thesis other than what the forward curve was then versus at the end of 2014, is being applied and executed as we implement this, again, details to follow at the Investor Day.

Great. Thank you.

Our next question is from Eric Berg of RBC Capital Markets. Please go ahead.

Thanks very much, and good morning to, everyone. I wanted to go back to your Slide 26 and a little table on the value of the DRD, because most companies - most of the life companies don’t really disaggregate the value of the DRD, it’s just something that they enjoy, but I guess it’s called a permanent difference and that reduces their gap effective tax rate. They typically don’t separate it out or spike it out as somehow a source of value. Can you review with me what you are saying here, is the plus sign meant to sort of communicate the idea that you consider the DRD to be a separate store value apart from the DTA?

Good morning, Eric, this is Ewout.

Good morning.

What we are trying to show here is the following. On the one hand what you see at the top part of the Slide 26 is the effects of our DTAs and the reduction of the tax valuation allowance on our U.S. GAAP balance sheet. So there are - on the U.S. GAAP balance sheet, we have now a release of the valuation allowance and a reflection of deferred tax assets for a total of $2.2 billion, $2.3 billion going forward. But that’s just an accounting reflection on the GAAP balance sheet. What we are trying to show at the bottom of this page is the cash benefit that the company will receive from using those DTAs in the future and the utilization of those DTAs will help to reduce the actual tax payments to the IRS, and those will be relatively minimal for the foreseeable future. The left side is showing the usage of the $3 billion nominal DTAs we have and if you look at the benefit and discount debt with a 10% discount rate, that’s a $1.6 billion number. But that does not reflect that the company will have an economic benefit from use of the DRD, that is dividend received deduction will have a significant economic benefit for the company. So what this tries to show is, if you take an assumption how many years the DRD will stay in place and that’s, of course, an assumption nobody can precisely answer, it will be five more years, it can be 10 more years, it can be 20 more years. This right-hand side on page 26 shows that there is another benefit on the net present value basis adding the DRD staying in place. And, for example, it stays in place another five years, the net present value for five years is $265 million. So you have to add that to the $1.6 million on the left-hand side and get to a total cash benefit for the company in the future.

And I have a follow-up question, a separate question regarding growth. I certainly understand, because you’ve been very clear that you have been to a certain extent purposely shrinking your business to remove from your roster underperforming business. I get that you have customers were just not generating the level of profitability that you would like. But at the end of the day, 2014 was a year I think in which the cash flows in a number of your core businesses, retirement, investment management, excluding the items that you disaggregate, fixed annuities were negative, not majorly so, but they were negative. Understanding and again, appreciating the fact that this is in part purposeful by you. I would like to know when we can expect to start seeing real growth in the balance sheet? Thank you. Organic growth that is.

Yes, Eric, thank you for the question. You are exactly right. Our plan is a plan that’s improving the return on equity and return on capital in order to create value to shareholders. We all know the insurance industry can sell unprofitable product if it wants to, but that’s not what we are trying to do. And part of it is adjusting that book of business as we referred to it, existing book of business that’s functioning below its way to get added, to [indiscernible] at it way. And so as we are - as we are renewing the book of business, if we cannot renew it at returns that are meeting our targeted internal rate of return, we’re electing not to renew our business. As we said before, we were in sort of half way through a little bit more than half way through the book of business, so there is a probably a couple of years still to go. But what we are doing in terms of the investments, in terms of the new return on equity target, it is to enable more substantial growth going forward of our businesses. So I would say on the repricing of our book of business, we still have probably a couple of years to go, Erik, where you will keep the noise in terms of repositioning that book of business.

Thank you, Alain.

Our next question is from Suneet Kamath from UBS. Please go ahead.

Thanks, good morning. Just a couple of clean-ups. First, on guidance. The 2018 ROE target of 13% to 14%, I think when you gave us the 2014 to 2015 ROE walk, you said that the impact of the lower tax rate - lower assumed tax rate would be essentially a wash with the impact of the spending for the ongoing business. Can we assume the same is true for the 2018 ROE, in other words the increase in the longer-term target is not driven by the lower tax rate/the expense initiatives or tax rate/the expense initiative?

Suneet, at this point we would not like to give further guidance than what would be the net effects on the 2015 ROE. You might be able to answer your question during the Investor Day in June. But at this point in time, it’s a bit premature to answer that question.

Okay. I mean, we’re just getting the question here, is this really a guide-up in terms of ROE, or is it just a change of the underlying assumptions? So clearly any incremental information you can provide on that would be, I think helpful, clearly any incremental information you can provide on that would be I think helpful to a lot of people. My second question is on the retirement repricing. So Alain, when you say that you are 50% of the way through cleaning up that book, is that repricing that book - is that based on like contracts or is that based on AUM?

It’s really based on the contract. So, they come through the process, I talked about this early as Rod speaking that we wish we could kind of push a button and fast forward through that. They have a natural - just duration that occurs, so it’s really about, it’s just based on that. The other piece that I called your attention is, we’re making substantial improvement in distribution enhancements in a broader product portfolio and increasing efficiency. And so as we get closer to the end of that, it will be a whole lot less about, where we are in that journey, and a lot more about our effectiveness in the implementation of these pieces, and again, we’ll give you far more color on that at the Investor Day meeting.

Okay. And the timing of the remaining 50%, I think, we started with a five-year kind of window back too?

It’s probably a couple of years.

Got it. Okay, great. Thank you.

You’re welcome.

This concludes our question-and-answer session. I’d like to turn the conference call back over to Rod Martin for any closing remarks.

Emily, thank you. We’ve demonstrated our ability to develop aggressive plans, execute them, and achieve great results. We’re focused on the future and on steps that we can take to further harness our strengths. We are excited about Voya’s next chapter and what it will mean for our customers and for our shareholders. We look forward to sharing more details of our plan with you and to discussing how we intend to establish Voya as a new kind of financial services company when it is committed to changing the way people think of retirement. Thank you, and good day.

The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.