Brookfield Asset Management Ltd.

Ladies and gentlemen, thank you for standing by, and welcome to the Brookfield Asset Management Fourth Quarter 2021 Results Conference Call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Ms. Suzanne Fleming, Managing Partner. Please go ahead.

Suzanne Fleming Thank you, Operator, and good morning, everyone. Welcome to Brookfield's Fourth Quarter and 2021 Full Year Conference Call. On the call today are Bruce Flatt, our Chief Executive Officer, Nick Goodman, our Chief Financial Officer, and Natalie Adame, Managing Director in our Renewable Power and Transition Group. Bruce will start off by giving a business update, followed by Nick, who will discuss our financial and operating results. And finally, Natalie will give an update on our transition strategy. After our formal remarks, we'll turn the call over to the operator and take analyst questions. In order to accommodate all those who want to ask questions, we ask that you refrain from asking more than two questions at a time. If you have additional questions, please rejoin the queue and we'll be happy to take any additional questions at the end as time permits. I'd like to remind you that in today's comments, including in responding to questions and in discussing new initiatives and our financial and operating performance, we may make forward-looking statements, including forward-looking statements within the meaning of applicable Canadian and U.S. securities law. These statements reflect predictions of future events and trends and do not relate to historic events. They're subject to known and unknown risks, and future events and results may differ materially from such statements. For further information on these risks and their potential impacts on our company, please see our filings with the securities regulators in Canada and the U.S. and the information available on our website. And with that, I'll turn the call over to Bruce.

Thank you, Suzanne, and welcome everyone on the call. We reported strong results for the year, with record total net income of $12.4 billion and distributable earnings for common shareholders of $6.3 billion. Results were driven by $71 billion of inflows of capital and associated fee-related earnings, strong performance from our principal investments, and gains in carry received from $42 billion of asset sales where we booked $16 billion of gains, $12 billion for clients, and $4 billion which came to BAM. As we enter 2022, the normalization of central bank monetary policy has caused volatility in the markets, mostly in sectors trading at high multiples. Those did not affect us in any major way. Our general view is that this has been a healthy re-rating and will likely create opportunity. For our business, with interest rates still very low on a relative basis and expected to stay so for some time, combined with the positive inflation of revenues, we are seeing a positive backdrop for most of our businesses. Our asset management business is continuing to attract large amounts of capital, with our product offerings aligned around several positive global investment themes. Our underlying operations continue to strengthen coming out of the recession, and with many of our businesses generating inflation-linked cash flows or positioned to benefit from economic growth, we are well-positioned. Turning now to our strategic initiatives, 2021 was a busy year in that regard. First off, we spun out and paired our reinsurance business, establishing BAM-R. Subsequent to that, we completed a number of reinsurance agreements and committed to acquire American National, which we expect to close in the coming months. American National will give us a U.S. insurance platform and provide us with direct origination capabilities. In total, we are heading towards $50 billion of insurance AUM, and the team is just getting started. Second, we privatized our real estate business. In short, we own one of the highest quality portfolios of prime properties in the world. Real estate securities were and in fact still are, trading in the market at discounts to their fair value. On the other hand, private markets are not. BPY shareholders were offered the ability to participate in BAM, so in our view, a privatization was a win-win. To date, it has turned out to be that way for everyone. In the last year, the tone of the private real estate market has improved dramatically, and liquidity in private markets is now returning to pre-pandemic levels. The recovery started with the growth sectors like industrial and life sciences, followed by multifamily, and has now turned to office with the rest to follow. In accordance with the plans we laid out for you at the time, we recently sold approximately $10 billion of real estate across a variety of sectors, We realized a gain of $2 billion above purchase price last year in these sales, representing a 47% annualized gain on the asset portion of ours. A good example of this is One Manhattan West, which is a phenomenal office tower in New York City we completed in 2019 in a complex where we own five other towers. We recently signed an agreement to sell a stake in it, which values the property at $2.9 billion, representing a 2.5 times multiple of capital and a 25% IRR since we started it. We're also retaining a controlling stake in the property that will continue to provide us with long-term compounding cash flows going forward. So as the recovery continues to gather pace, we are well positioned to strategically monetize further select assets and unlock more value in our real estate to be deployed elsewhere. Our third strategic initiative was to repackage, rebrand, and expand our renewables investing strategy into a fund for transition to net zero. This culminated in a large fund which will close at $15 billion shortly Natalie Adamate is here today to provide more details for you on that. Our last strategic initiative was a review of our overall structure of our asset management business as the financial markets evolved. As noted in our year-end letter, over the past 25 years, we have become one of the largest, fastest-growing, and most diversified managers globally. Combined with the fact that we have very long duration annuity life cash flows, our manager is now the scale that it could be separated out from the rest of our capital. In a market environment that seemingly perverts asset life managers, it may therefore make sense to separate part of the manager and offer investors a security that owns our asset manager separate from our capital. For backdrop, based on comparable multiples for pure play, asset light, alternative investment managers, our managers should be valued in the range of $70 to $100 billion. This is in addition to the $50 billion of net capital that we have invested in our businesses today. If we separate part of the manager... This could increase the simplicity and ease of valuing our asset management business, provide a security for those that wish asset light, and also possibly open up new growth options for the overall business. As you all know, our business has compounded at an annualized return of 20% for 20 years. Our job is always to continue to invest well, take care of our clients, and review our structure from time to time to ensure we unlock value for all shareholders. We will report on this as we move along. As always, thank you for your support. And with that, I'll turn the call over to Nick to tell you about our financial results.