iA Financial Corporation Inc.

Thank you for standing by. This is the conference operator. Welcome to the IA Financial Group Second Quarter 2026 Earnings Results Conference Call. As a reminder, all participants are in a listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star then zero. I would now like to turn the conference over to Caroline Drouin, Head of Investor Relations with IA Financial Group. Please go ahead.

Thank you and good morning, everyone. Bonjour à tous. Welcome to IA's second quarter 2026 conference call. This conference call is open to the financial community, the media, and the public. I remind you that the question period is reserved for financial analysts. And before we start, I draw your attention to the forward-looking statements information on slide two. Forward-looking statements made today are subject to risks and uncertainties that could cause actual results to differ materially. These statements are based on certain material factors and assumptions. I also draw your attention to the non-IFRS and additional financial measures on slide 3. Today's commentary will also include adjusted financial measures, which should be considered as a supplement to IFRS measures. For further details, including those factors and assumptions, please refer to our press release and MD&A. I will start by introducing everyone attending on behalf of IA. Denis Ricard, President and CEO, Eric Jobin, Chief Financial Officer and Chief Actuary, Alain Bergeron, Chief Investment Officer, Denis Berthiaume, Chief Growth Officer for our Canadian operations and responsible for IA Auto and Home. Stephane Bourbonnet, responsible for her wealth management operations, Renee Laflamme, responsible for individual insurance, savings and retirement, Sean O'Brien, chief growth officer for our U.S. operations and responsible for dealer services, Louis-Philippe Pouliot, in charge of group benefits and retirement solutions. And with that, I will now turn the call over to Denis Ricard.

Good morning, and thank you for joining us today. We delivered another strong quarter, demonstrating once again the value of our diversified business model. Our ability to generate consistent profitability is supported by multiple sources of earnings and solid growth for the organization. At the same time, wealth management continues to strengthen its contribution to our results and is becoming an increasingly important driver of growth. Across the organization, our focus remains on discipline execution and profitable growth. We continue to make deliberate decisions that prioritize long-term value creation, business quality, and sustainable returns. These priorities are clearly reflected in our second quarter results. Turning to slide eight, the quarter was strong across several dimensions. Earnings, ROE, business growth, Capital and shareholder value. Importantly, the growth was not concentrated in one area. It reflected the strong activity in our distribution platforms, continued wealth management momentum, and disciplined execution across the organization. Let me highlight a few key metrics. Core EPS was $3.68, up 5% year-over-year, and EPS was $4.28, up 25% year-over-year. Our trailing 12-month score reached 17.5%, in line with our 2026 target of 17% or more. Business growth was also strong. Net premiums, premium equivalents, and deposits were $6.3 billion, up 25% year-over-year. Assets under management and administration grew 37% over the last 12 months. This growth reflects solid organic growth from funding flows, favorable markets, and the addition of RF capital. Our financial position remained a clear strength. The solvency ratio stood at 137% at quarter end, and we had $1.1 billion of capital available for deployment. We also generated $188 million of organic capital during the quarter. At the same time, we continued to return capital to shareholders. During the quarter, in addition to our regular dividend, we deployed $347 million to our share buyback program. Finally, book value per common share reached $80.55, up 6% over the last 12 months. Overall, these results reinforce our confidence in the trajectory of our business. We are growing, delivering strong profitability, and maintaining the balance sheet strength needed to create long-term value. Turning now to slide nine. Our insurance Canada segment delivered a good quarter supported by the strength of our distribution platforms, the diversity of our businesses and our continued focus on profitable growth. In individual insurance, sales total $102 million, a result comparable to last year's strong performance. We remain very pleased with the momentum across the business and the strength of our market position. We continue to benefit from our growing distribution network, the effectiveness of our digital tools, and our comprehensive product offering. We also maintain our leading position in Canada for the number of policies issued. The stability of our results reflects our disciplined approach to underwriting and business selection, which supports sustainable profitable growth over time. In group insurance, premium and deposits remain close to the strong level recorded a year ago. Employee plans implemented sales reached $30 million, significantly above the $8 million recorded in the second quarter of 2025. In special markets, sales were affected by lower volumes of international student medical insurance following federal government measures limiting the number of international students entering Canada. We have also taken deliberate actions to optimize the business mix and focus on opportunities that meet our return objectives. This disciplined approach strengthens the quality of future earnings, and we expect the impact of lower international student volumes on sales to remain visible in the second half of the year. Dealer services sales remain good at the $218 million, close to the results from the same period last year, benefiting from our extensive distribution network and comprehensive suite of dealer services products. Finally, at IU Auto and Home, direct written premium increased 5% over a year to $216 million, This growth was driven by higher policy volumes and the favorable impact of price adjustments implemented over the last 12 months. Overall, our insurance Canada businesses continue to demonstrate the beneficial scale, the distribution strength, and disciplined execution, while maintaining a strong focus on profitable growth. Turning to slide 10, wealth management delivered another solid quarter and continues to be an increasingly important contributor to our growth and earnings profile. Momentum remains strong across the platform, with growth sales reaching $4.3 billion and combined net inflows of SEC funds and mutual funds of $934 million. We further strengthened our leadership position in the Canadian SEC fund market, maintaining the number one position for both growth and net sales. Individual SEC fund growth sales increased 52% year-over-year to more than $2 billion, While net sales exceeded $1 billion, this performance reflects the strength of our growing distribution networks, strong advisor engagement, and the attractiveness of our product offering. In mutual funds, gross sales increased 46% year-over-year to $644 million, while net outflows of $73 million were recorded. Sales of other individual savings products reached $449 million, up 5% from last year. And finally, in group savings and retirement, total sales exceeded $1.1 billion, up 35% year-over-year, supported by strong momentum in accumulation products. Total assets under management increased 15% year-over-year. As we continue to build one of Canada's leading independent wealth franchises, we remain well positioned to benefit from long-term wealth accumulation trends and generate sustainable growth in assets, earnings, and shareholder value. Turning now to slide 11, our U.S. operations remain an important growth platform and a valuable contributor to the diversification of our business and earnings profile. The quarter once again demonstrated the benefits of our diversified U.S. presence across both individual insurance and dealer services. In individual insurance, sales reached a quarterly record of $86 million, up 10% from a year ago. This strong performance was driven by continued growth in the final expense and middle market segments, supported by disciplined sales practices, key digital capabilities, and strong engagement across our distribution network. In dealer services, sales totaled $292 million, broadly in line with the same quarter last year, despite less favorable U.S. auto market conditions. The business continues to benefit from the effectiveness and diversity of its distribution channels, as well as the quality of our products and services.