Kevin Hogan: Thanks, Elyse. So look, one thing I’ll say is we live in a very complex world, complex regulatory environment and part of our responsibility is to be able to master the complexity of that environment. And this DOL ruling is just the most recent ruling that we’re in the process of interpreting and understanding. What I would say is that the words maybe different, but the concepts, many of the concepts in this ruling are similar to the fiduciary rule of 2016 and even some DOL activity earlier in the decade. And as a reminder, both our company as well as the industry actually implemented those regulations until they were overturned by the courts. And so this is territory that is reasonably familiar. It looks like that this ruling is really trying to expand ERISA-type obligations to all retirement-related advice or recommendations, et cetera.
And I’ll remind you that our company kind of grew up in the registered world, whether it’s on the individual retirement side where we primarily work through registered reps of broker dealers or banks or in the retirement services side where our originations are through valid financial advisors, which is a duly registered RIA broker dealer. That is the primary source of business that we have. We are familiar and our distribution channels are familiar with the advisory framework that I think is being reflected in the intention of this DOL ruling. So a very high percentage, probably 90%-ish plus of our individual retirement sales and 100% of the VFA sales are already subject to a high level standard of duty of care. And although it’s a big act, there’s a lot of filings around it.
It’s in early stages. There will be a public comment period, et cetera. We’re not anticipating, it’s going to have a significant impact on our business.
Elyse Greenspan: Thanks. And then my second question, you mentioned, right, that you have $1.7 billion at the Holdco, which exceeds next 12 months’ needs. Is that what you guys are targeting, especially I guess when we get through some of the separation costs and the costs associated with your savings program?
Elias Habayeb: Hey, Elyse, it’s Elias. Our target for the parent liquidity is to cover the next 12-month needs, and right now it’s less than $1.7 billion, and that should come down as we complete the one-time spend on the initiatives we’ve talked about which were relating to Corebridge Forward and the separation from AIG. The first one is $300 million, the second one is $350 million to $450 million, and we’d expect that will be mostly done by the end of this year associated with it. And so we will kind of – what our need is will be coming down, but the position we are in right now is we are in excess of what our need is and that kind of demonstrates the financial flexibility and the strength of our insurance company cash flows.
Our insurance companies have delivered $1.5 billion this year, which is in line with what they’ve distributed in the prior years. And that should be sufficient to get us to the 60% to 65% payout ratio, which we would expect to achieve in 2024. And we feel comfortable we’re on track getting there.
Elyse Greenspan: Thank you.
Kevin Hogan: Thank you.
Operator: Our next question comes from Alex Scott of Goldman Sachs. Alex, your line is open. Please proceed.
Alex Scott: Hi, good morning. First one I have for you is just on potential further strategic action on the business. Certainly, I appreciate the two transactions you already did were quite attractive and interesting. So I hate to ask you so quickly about what next, but I’m going to do it anyway. So, what is the opportunity out there? What do you see in the market around private equity interests, some of the blocks of business you have around fixed, fixed and next annuities? Do you think there’s an opportunity there?
